InterDigital Communications Corporation
Amended & Restated
Articles of Incorporation
In compliance with the requirements of the Pennsylvania Business
Corporation Law of 1988, as amended, the Articles of Incorporation of
INTERDIGITAL COMMUNICATIONS CORPORATION are hereby amended and restated in their
entirety to read as follows:
First. The name of the Corporation is InterDigital Communications Corporation.
Second. The location and post office address of its registered office is
781 Third Avenue, King of Prussia, Pennsylvania 19406-1409.
Third. The Corporation is incorporated under the Business Corporation Law of the
Commonwealth of Pennsylvania for the purpose or purposes of engaging in or doing
any lawful act concerning any or all lawful business for which corporations may
be incorporated under the Pennsylvania Business Corporation Law, including but
not limited to manufacturing, owning, using, leasing and dealing in personal
property of every class and description, and acquiring, owning, using and
disposing of real property of any nature whatsoever.
Fourth. The term for which the Corporation is to exist is perpetual.
Fifth. The aggregate number of shares of all classes of stock which the
Corporation shall have authority to issue is 75,000,000 shares of Common Stock,
$0.1 par value per share ("Common Stock"), and 14,398,600 shares of Preferred
Stock ("Preferred Stock").
The voting rights, designations, preferences, qualifications,
privileges, limitations, options, conversion rights and other special rights
(the "Rights and Preferences") of the shares of the respective classes of stock
of the Corporation are and will be determined as follows:
A. Preferred Stock
The Board of Directors of the Corporation shall have full and
complete authority, by resolution from time to time, to establish one
or more series and to issue shares of Preferred Stock and to fix,
determine and vary the Rights and Preferences of each series of
Preferred Stock, including, but not limited to, dividend rates and
manner of payment, preferential amounts payable upon voluntary or
involuntary liquidation, voting rights, conversion rights, redemption
prices, terms and conditions and sinking fund and stock purchase
prices, terms and conditions.
B. Common Stock and Class Preferred Stock
The Rights and Preferences of the shares of Common Stock and
Class Preferred Stock, as between themselves only and subject to the
Rights and Preferences of Preferred Stock, are as follows:
(i) Definitions. For the purpose of this Article
Fifth, except as otherwise expressly provided herein or unless
the context otherwise requires, the following words and terms
shall have the following definitions:
(a) "Net Income Per Share" means the net profit
per share of Common Stock for a fiscal year of the
Corporation, excluding items of extraordinary income
and expense, on a fully diluted basis, and after
provision for federal, state and local income taxes,
as determined by the Corporation's independent
certified public accountant, in accordance with
generally accepted accounting principles applied on a
basis consistent with prior periods.
(b) "Average Bid Price" means the average of the
daily reported closing price per share of Common
Stock during any period of 120 consecutive trading
days. If the Common Stock is listed for trading on an
organized stock exchange, the closing price shall be
the closing price as reported on said exchange; and
if the Common Stock is not listed for trading on any
such exchange, the closing price shall be the closing
bid price as reported by NASDAQ, and if not so
reported, the closing bid price as furnished by any
dealer in securities dealing in the Common Stock.
(c) "Conversion Number" means the number of
shares of Common Stock which a holder of Class
Preferred Stock is entitled to receive upon the
conversion of one share of Class Preferred Stock. The
initial Conversion Number shall be fifty (50). The
Conversion Number shall be subject to adjustment from
time to time as set forth in Paragraphs v(d) and
(e) hereof.
(d) "Expiration Date" means December 12, 1986.
(ii) Dividends. Holders of Common Stock shall be
entitled to receive dividends when and as declared by the
Board of Directors of the Corporation. Dividends shall be
payable out of the assets of the Corporation legally available
therefor and not otherwise. Holders of Class Preferred Stock
shall not be entitled to receive dividends, and no dividends
shall be declared or paid thereon.
(iii) Liquidation.
(a) Class Preferred Stock. In the event that the
Corporation shall be liquidated, dissolved or wound
up, whether voluntarily or involuntarily, after all
creditors of the Corporation shall have been paid in
full, the holders of Class Preferred Stock shall be
entitled to receive an amount equal to $.05 per share
before any amount shall be paid to the holders of
Common Stock. If the assets of the Corporation
available for distribution to the holders of Class
Preferred Stock shall be insufficient to permit
payment of an amount equal to $.05 per share to the
holders of Class Preferred Stock, then all such
assets of the Corporation shall be distributed, to
the exclusion of the holders of Common Stock, ratably
among the holders of Class Preferred Stock, according
to the amount which they respectively would be
entitled to receive if such assets were sufficient to
permit the payment in full of said amounts.
(b) Common Stock. The holders of Common Stock
shall be entitled to receive, pro rata, all of the
assets of the Corporation available for distribution
to its shareholders after distribution has been made
as aforesaid to holders of Class Preferred Stock.
(iv) Voting Rights
(a) Except as otherwise required herein or by law
or as may be provided to holders of Preferred Stock,
the holders of Common Stock shall
possess full and exclusive voting power for the
election of directors and for all other purposes.
Every holder of Common Stock shall have the right to
one vote for each share of Common Stock owned. The
holders of Class Preferred Stock shall have no right
to vote at, to participate in, or to receive any
notice of any meeting of the shareholders of the
Corporation, unless and then only to the extent to
which their vote shall be required by law or by
Paragraph B(iv)(b) hereof. On any matter which the
holders of Class Preferred Stock shall be entitled to
vote, they shall be entitled to one vote for each
share of Class Preferred Stock owned.
(b) The Corporation shall not merge into or
consolidate with any other corporation, or sell all
or substantially all of its assets without the
consent, given in writing or by resolution adopted at
a meeting duly called for that purpose, of the
holders of a majority of all outstanding Common Stock
and Class Preferred Stock, voting as a single class,
with each share of Common Stock and Class Preferred
Stock, regardless of class, being entitled to one
vote; provided, however, that no holder of Class
Preferred Stock shall be entitled to vote on such
merger, consolidation or sale if, under the terms
thereof, each such holder of Class Preferred Stock,
in exchange for Class Preferred Stock, will receive
preferred stock of the surviving, resulting or
acquiring entity which shall, in the aggregate,
possess redemption, liquidation, voting and
conversion rights which are at least as favorable as
those possessed by the Class Preferred Stock held
immediately prior to the effective date of the
merger, consolidation or sale.
(v) Conversion into Common Stock. At any time on or
prior to the Expiration Date (and at no time after the
Expiration Date), shares of Class Preferred Stock shall be
convertible into Common Stock as follows:
(a) Class "A" Preferred Stock. If (x) during the
twenty-four (24) months following November 12, 1981,
the Average Bid Price shall be Sixteen and 50/100
($16.50) Dollars per share or more; or (y) after
twenty-four (24) months following November 12, 1981,
the Average Bid Price shall be Twenty-Five ($25.00)
Dollars per share or more (the amount of the Average
Bid Price which must be achieved to permit conversion
pursuant to Subparagraphs (a) (x) and (y) and
Subparagraphs (b) (x) and (y) hereof shall be
hereinafter referred to as the "Conversion Average
Bid Price"); or (z) for any fiscal year of the
Corporation ending on or before December 31, 1985,
the Corporation has net Income Per Share of One
($1.00) Dollar or more, (the amount of net Income Per
Share, which must be achieved in order to permit
conversion pursuant to Subparagraphs (a) (z) and (b)
(z) hereof, shall be hereinafter referred to as the
"Conversion Net Income Per Share"), then the holders
of Class "A" Preferred Stock, at their option, shall
have the right, exercisable at any time on or prior
to the Expiration Date, to convert their shares of
Class "A" Preferred Stock into shares of Common Stock
at the rate of the Conversion Number in effect on the
date the conversion right is exercised.
(b) Class "B" Preferred Stock. If (x) during the
twenty-four (24) months following November 12, 1981,
the Average Bid Price shall be Sixteen and 50/100
($16.50) Dollars per share or more; or (y) after
twenty-four (24) months following November 12, 1981,
the Average Bid Price shall be Twenty-Five ($25.00)
Dollars per share or more; or (z) for any fiscal year
of the Corporation ending on or before December 31,
1985, the corporation has Net Income Per Share of One
and 50/100 ($1.50) Dollars or more, then the holders
of Class "B" Preferred Stock, at their option, shall
have the right, exercisable at any time on or prior
to the Expiration Date, to convert their shares of
Class "B" Preferred Stock
into shares of Common Stock at the rate of the
Conversion Number in effect on the date the
conversion right is exercised.
(c) The holder of any certificate for shares of
Class Preferred Stock desiring to convert any of such
shares pursuant to the provisions of Paragraph (v)
hereof shall surrender the holder's certificate at
the principal office of the Transfer Agent for the
Common Stock, with the form of written notice on the
certificate of such election to convert into Common
Stock duly complete and executed. The holder of the
shares so surrendered for conversion shall be
entitled to receive a certificate or certificates for
the number of shares of Common Stock to which the
holder shall be entitled upon such conversion,
registered in the name of such holder.
The Corporation shall not be required to deliver
certificates for shares of its Common Stock or new
certificates for unconverted shares of Class
Preferred Stock while the stock transfer books for
the respective classes of stock are duly closed for
any purpose, but the right of surrendering such
shares for conversion shall not be suspended during
any period that the stock transfer books of either of
such classes of stock are closed.
The conversion right shall be deemed to have been
exercised and the shares of Common Stock issuable
upon such conversion shall, subject to the provisions
of the first paragraph of this Subparagraph (c), be
deemed to have been issued on the date of the receipt
by the Transfer Agent for the Common Stock of the
certificate representing such shares of Class
Preferred Stock with the requirements for conversion
satisfied, except that if the transfer books for the
Common Stock are closed on the date of such receipt,
the conversion right shall be deemed to have been
exercised on the first date thereafter on which the
transfer books shall be open. The person entitled to
receive the Common Stock issuable upon such
conversion shall, on the date such conversion right
is deemed to have been exercised and thereafter, be
treated for all purposes as the record holder of such
Common Stock, and the record holder of the Class
Preferred Stock being converted shall, on the same
date, cease to be treated for any purpose as the
record holder of such Class Preferred Stock.
(d) The Conversion Number, the Conversion Average
Bid Price and the Conversion Net Income Per Share
shall be subject to adjustment from time to time as
follows:
(x) If the Corporation shall, at any time
prior to the Expiration Date, effect a
subdivision of as Common Stock, by
reclassification or otherwise, or if the
Corporation shall, at any time prior to the
Expiration Date, effect a combination of its
Common Stock, by reclassification or otherwise,
the Conversion Number in effect immediately prior
to such subdivision or combination shall be
increased or decreased, as the case may be, and
the Conversion Average Bid Price and the
Conversion Net Income Per Share shall be
decreased or increased, as the case may be, each
such change to be in proportion to the change in
the number of the then outstanding shares of
Common Stock. In each such case, the adjustment
in the Conversion Number, the Conversion Average
Bid Price and the Conversion Net Income Per Share
shall be effective on the date that such
subdivision or combination becomes effective.
(y) If the Corporation shall at any time,
prior to the Expiration Date, declare a dividend
on Common Stock or make a distribution on Common
Stock payable in Common Stock, then, in each such
case, from and after the record date for
determining the shareholders entitled to receive
such dividend or distribution, the Conversion
Number, the Conversion Average Bid Price and the
Conversion Net Income Per Share in effect
immediately prior to such date shall be increased
or decreased proportionately, as the case may be.
(e) In the case of any reclassification or change
other than as set forth in Subparagraph (d) above of
the outstanding shares of Common Stock prior to the
Expiration Date (other than a change in par value, or
from par value to no par value, or from no par value
to par value, or a change of such shares into a
greater or lesser number of shares of the same or a
different par value or without par value), or in case
of any consolidation or merger of the Corporation
prior to the Expiration Date with or into any other
corporation (other than a merger in which the
Corporation is the surviving or continuing
corporation and which does not result in any
reclassification, conversion or change of the
outstanding shares of Common Stock), or in the case
of any sale or conveyance to another corporation of
all or substantially all the assets of the
Corporation, in connection with which shares or other
securities or cash or other property shall be
issuable, distributable, payable or deliverable for
outstanding shares of Common Stock, provision shall
be made so that holders of Class Preferred Stock
shall thereafter have the right to convert each share
of Class Preferred Stock into the kind and amount of
shares of stock and/or other securities or property
receivable upon such reclassification, change,
consolidation or merger by a holder of the number and
kind of shares of Common Stock into which such share
of Class Preferred Stock might have been converted,
subject to the terms of Paragraphs v(a) and (b)
hereof, immediately prior to such reclassification,
change, consolidation or merger. The foregoing
provisions of this Subparagraph (e) shall similarly
apply to successive reclassifications and changes of
shares of capital stock and to successive
consolidations or mergers.
(f) Whenever the Conversion Number, the
Conversion Average Bid Price and the Conversion Net
Income Per Share are required to be adjusted pursuant
to Paragraphs v(d) and (e) hereof, the Corporation's
independent certified public accountant shall compute
the Conversion Number, the Conversion Average Bid
Price and the Conversion Net Income Per Share are
adjusted, and shall prepare a certificate setting
forth such adjustments and the facts upon which such
adjustments are based, and such certificate shall
forthwith be filed with the Transfer Agent for the
Class Preferred Stock and the Common Stock. The
Corporation shall mail notice of such adjusted
Conversion Number, Conversion Average Bid Price and
Conversion Net Income Per Share to each holder of
Class Preferred Stock.
(g) Within thirty (30) days after conversion
privileges, as set forth in Paragraphs v(a) and/or
(b) hereof shall accrue, the Corporation shall cause
notice thereof to be mailed to the holders of record
of the Class "A" Preferred Stock and/or the Class "B"
Preferred Stock, as the case may be. Such holder
shall thereafter be entitled to receive all notices
mailed by the Corporation to holders of record of
Common Stock.
(h) The Corporation shall at all times prior to
the Expiration Date reserve from the authorized and
unissued shares of its Common Stock a
sufficient number of shares to provide for the
conversion of the Class Preferred Stock. Shares of
Common Stock issued upon the conversion of Class
Preferred Stock shall be fully paid for an
non-assessable. Upon the conversion of any shares of
Class Preferred Stock, the Corporation's Retained
Earnings (Surplus) Account shall be charged with an
amount equal to the difference between the aggregate
par value of the shares of Class Preferred Stock
which are converted and the aggregate par value of
the shares of Common Stock which are issued upon such
conversion.
(i) Any and all issue taxes which may be imposed
in respect of any issue or delivery of stock upon the
conversion of any shares of Class Preferred Stock
into Common Stock, or of stock receivable upon
conversion thereof, shall be paid by the person or
persons surrendering such stock for conversion.
(vi) Redemption. Within six (6) months after the
Expiration Date, the Corporation shall redeem all Class
Preferred Stock then outstanding at a redemption price of $.05
per share. Holders of Class Preferred Stock shall, within
fifteen (15) days of the date fixed by the Corporation for
redemption, return all certificates evidencing said Class
Preferred Stock to the Corporation, and the only rights of
said holders shall be to receive the redemption price.
(vii) Prohibition Against Reissuance. Any shares of
Class Preferred Stock which shall be redeemed or otherwise
acquired by the Corporation, or which shall have been
converted into Common Stock, shall not be reissued, and the
authorized number of shares of Class Preferred Stock of the
Corporation shall be decreased by the number of shares of
Class Preferred Stock redeemed, otherwise acquired by the
Corporation or converted into Common Stock.
(viii) Elimination of Preemptive Rights. No holder of
securities of any class of the Corporation shall be entitled
as such, as a matter of right, to subscribe for or purchase
any part of any new or additional issue of securities of any
class of the Corporation, whether now or hereafter authorized,
except only as may be otherwise expressly provided with
respect to Preferred Stock.
Sixth. Shareholder's cumulative voting rights for the election of directors are
eliminated and denied.
Seventh. (a) The Directors, other than those who may be elected by the holders
of any class or series of stock entitled to elect directors separately, shall be
classified, with respect to the time for which they severally hold office, into
three classes, as nearly equal in number as possible, as shall be provided in
the manner specified in the By-laws of the Corporation, one class to be
originally elected for a term expiring at the annual meeting of shareholders to
be held in 1985, another class to be originally elected for a term expiring at
the annual meeting of shareholders to be held in 1986, and another class to be
originally elected for a term expiring at the annual meeting of shareholders to
be held in 1987, with each class to hold office until its successor is elected
and qualified. At each annual meeting of the shareholders of the Corporation,
the successors of the class of Directors whose term expires at that meeting
shall be elected to hold office for a term expiring at the annual meeting of
shareholders held in the third year following the year of their election.
(b) Except as otherwise provided for or fixed by or pursuant to the
provisions of Article Fifth hereof relating to the rights of the holders of any
class or series of stock entitled to elect Directors separately, newly created
directorships resulting from any increase in the number of Directors and
separately, newly created directorships resulting from any increase in the
number of Directors and any vacancies on the Board of Directors resulting from
death, resignation, disqualification, removal or other cause shall be filled by
the Directors in the manner provided in the By-laws of the Corporation, to hold
office for the remainder of the full term of the class of Directors in which the
new directorship was created or the vacancy occurred and until such Director's
successor shall have been elected and qualified. No decrease in the number of
Directors constituting the Board of Directors shall shorten the term of any
incumbent Director.
(c) Except for the rights of any class or series of stock entitled to
elect Directors separately, any Director may be removed from office, without
assigning any cause, but only by the affirmative vote of the holders of 80
percent of the combined voting power of the then outstanding shares of stock
entitled to vote generally in the election of Directors, voting together as a
single class.
(d) Notwithstanding anything contained in the Articles of Incorporation
or By-laws to the contrary, and subject to the rights of any class or series of
stock entitled to elect Directors separately, the affirmative vote of the
holders of at least 80 percent or more of the combined voting power of the then
outstanding shares of stock entitled to vote generally in the election of
directors, voting together as a single class, shall be required to alter, amend
or repeal this Article Seventh or to adopt any provision inconsistent herewith."
"Eighth. (a) The holders of all the shares outstanding and entitled to vote may,
by a majority vote, in the manner set forth in the By-laws, alter, amend or
repeal the By-laws of the Corporation, provided, however, that the affirmative
vote of the holders of 80 percent or more of the combined voting power of the
then outstanding shares of stock entitled to vote generally in the election of
directors, voting together as a single class, shall be required to alter, amend
or repeal Sections 3.1, 3.4, 3.11 or 8.1 of the By-laws, as set forth in Exhibit
C to the Proxy Statement of April 27, 1984, of the Corporation, or to adopt any
provision inconsistent therewith.
(b) The Board of Directors, by a majority vote of the members thereof,
may make, alter, amend or repeal any provisions of the By-laws, in the manner
set forth in the By-laws. The shareholders shall have the right to change such
action by a majority vote of the shareholders entitled to vote thereon at any
Annual Meeting duly convened after notice to the shareholders of such purpose,
provided, however, that the vote of the holders of at least 80 percent of the
combined voting power of all of the then outstanding shares of stock entitled to
vote generally in the election of directors, voting together as a single class,
shall be required to change such action with respect to Sections 3.1, 3.4, 3.11
or 8.1."
(c) Notwithstanding anything contained in the Articles of Incorporation
to the contrary, and subject to the rights of any class or series of stock
entitled to elect Directors separately, the affirmative vote of the holders of
at least 80 percent of the combined voting power of the then outstanding shares
of stock entitled to vote generally in the election of directors, voting
together as a single class, shall be required to alter, amend or repeal this
Article Eighth or to adopt any provision inconsistent herewith."
Ninth. The vote of shareholders of the Corporation required to approve any
Business Combination shall be as set forth in this Article Ninth. The term
"Business Combination" shall have the meaning ascribed to it in (a)(B) of this
Article; each other capitalized term used in this Article shall have the meaning
ascribed to it in (c) of this Article.
(a)(A) In addition to any affirmative vote required by law or the
Articles of Incorporation or any resolution adopted pursuant to Article Fifth of
the Articles of Incorporation, and except as otherwise expressly provided in (b)
of this Article Ninth, a Business Combination shall not be consummated without
the affirmative vote of the holders of at least 80 percent of the combined
voting power of the then outstanding shares of stock of all classes and series
of the Corporation entitled to vote generally in the election of Directors
("Voting Stock"), in each case voting together as a single class (it being
understood that for purposes of this Article Ninth, each share of the Voting
Stock shall have the number of votes granted to it pursuant to Article Fifth of
the Article of Incorporation). Such affirmative vote shall be required
notwithstanding the fact that no vote may be required, or that a lesser
percentage may be specified, by
law or by the Articles of Incorporation or any resolution or resolutions adopted
pursuant to Article Fifth of the Articles of Incorporation or in any agreement
with any national securities exchange or otherwise.
(B) The term "Business Combination" as used in this Article Ninth shall
mean:
(1) any merger of consolidation of the Corporation or any
Subsidiary with (i) any Interested Shareholder or (ii) any other
corporation or entity (whether or not itself an Interested Shareholder)
which is, or after each merger or consolidation would be, an Affiliate
of an Interested Shareholder; or
(2) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of transactions) to or with
any Interested Shareholder or any Affiliate of any Interested
Shareholder of all or a Substantial Part of the assets of the
Corporation or any Subsidiary; or
(3) the issuance or transfer by the Corporation or any Subsidiary
(in one transaction or a series of transactions) of any securities of
the Corporation or any Subsidiary to any Interested Shareholder or any
Affiliate of any Interested Shareholder in exchange for cash,
securities or other property (or a combination thereof), other than the
issuance of securities upon the conversion of convertible securities of
the Corporation or any Subsidiary which were not acquired by such
interested Shareholder (or such Affiliate) from the Corporation or a
Subsidiary; or
(4) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation proposed by or on behalf of an
Interested Shareholder or any Affiliate of any Interested Shareholder;
or
(5) any reclassification of securities (including any reverse stock
split), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
other transaction (whether or not with or into or otherwise involving
an interested Shareholder) which in any such case has the effect,
directly or indirectly, of increasing the proportionate share of the
outstanding shares of any class or series of stock or securities
convertible into stock of the Corporation or any Subsidiary which is
directly or indirectly beneficially owned by any Interested Shareholder
or any Affiliate of any Interested Shareholder;
(b) The provisions of (a) of this Article Ninth shall not be applicable
to any Business Combination in respect of which all of the conditions specified
in either of the following paragraphs A and B are met, and such Business
Combination shall require only such affirmative vote as is required by law and
any other provision of the Articles of Incorporation and any resolution or
resolutions of the Board of Directors adopted pursuant to Article Fifth of the
Articles of Incorporation.
(A) Such Business Combination shall have been approved by a
majority of the Disinterested Directors, or
(B) Each of the six conditions specified in the following clauses
(1) through (6) shall have been met:
(1) the aggregate amount of the cash and the Fair Market Value
as of the date of the consummation of the Business Combination (the
"Consummation Date") of any consideration other than case to be
received by holders of Common Stock in such Business Combination
shall be at least equal to the higher of the following:
(i) (if applicable) the highest per share price (including
any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid in order to acquire any shares of Common
Stock beneficially owned by the Interested
Shareholder which were acquired beneficially by such Interested
Shareholder (x) within the two-year period immediately prior to
the Announcement Date or (y) in the transaction in which it
became an Interested Shareholder, whichever is higher; or
(ii) the Fair Market Value per share of Common Stock on the
Announcement Date or on the date on which the Interested
Shareholder became an Interested Shareholder (the Determination
Date), whichever is higher; and
(2) the aggregate amount of the cash and the Fair Market Value
as of the Consummation Date of any consideration other than cash to
be received per share by holders of shares of any other class or
series of Voting Stock shall be at least equal to the highest of
the following (it being intended that the requirements of this
clause (B)(2) shall be required to be met with respect to every
class and series of such outstanding Voting Stock, whether or not
the Interested Shareholder beneficially owns any shares of a
particular class or series of Voting Stock):
(i) (if applicable) the highest per share price (including
any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid in order to acquire any shares of such
class or series of Voting Stock beneficially owned by the
Interested Shareholder which were acquired beneficially by such
Interested Shareholder (x) within the two-year period
immediately prior to the Announcement Date or (y) in the
transaction in which it became an interested Shareholder,
whichever is higher;
(ii) (if applicable) the highest preferential amount per
share to which the holders of shares of such class or series of
Voting Stock are entitled in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the
Corporation; and
(iii) the Fair Market Value per share of such class or
series of Voting Stock on the Announcement Date or the
Determination Date, whichever is higher; and
(3) the consideration to be received by holders of a particular
class or series of outstanding Voting Stock (including Common
Stock) shall be in cash or in the same form as was previously paid
in order to acquire beneficially shares of such class or series of
Voting Stock that are beneficially owned by the Interested
Shareholder and if the Interested Shareholder beneficially owns
shares of any class or series of Voting Stock that were acquired
with varying forms of consideration, the form of consideration to
be received by holders of such class or series of Voting Stock
shall be either cash or the form used to acquire beneficially the
largest number of shares of such class or series of Voting Stock
beneficially acquired by it prior to the Announcement Date; and
(4) after such Interested Shareholder has become an Interested
Shareholder and prior to the consummation of such Business
Combination:
(i) except as approved by a majority of the Disinterested
Directors, there shall have been no failure to declare and pay
at the regular dates therefor the full amount of any dividends
(whether or not cumulative) payable on any class or series of
stock having preference over the Common Stock as to dividends
or upon liquidation;
(ii) there shall have been (x) no reduction in the annual
rate of dividends paid on the Common Stock (except as necessary
to reflect any subdivision of the Common Stock), except as
approved by a majority of the Disinterested Directors, and (y)
an increase in such annual rate of dividends (as necessary to
prevent any such reduction) in the event of any
reclassification (including any reverse stock split)
recapitalization, reorganization or any similar transaction
which has the effect of reducing the number of outstanding
shares of the Common Stock, unless the failure so to increase
such annual rate was approved by a majority of the
Disinterested Directors; and
(iii) such Interested Shareholder shall not have become the
beneficial owner of any additional shares of Voting Stock
except as part of the transaction in which it became an
Interested Shareholder; and
(5) after such Interested Shareholder has become an Interested
Shareholder, such Interested Shareholder shall not have received
the benefit, directly or indirectly (except proportionately as a
shareholder), of any loans, advances, guarantees, pledges or other
financial assistance or tax credits or other tax advantages
provided by the Corporation, whether in anticipation of or in
connection with such Business Combination or otherwise; and
(6) a proxy or information statement describing the proposed
Business Combination and complying with the requirements of the
Securities Exchange Act of 1934 and the rules and regulations
thereunder (or any subsequent provisions replacing such Act, rules
or regulations) shall be mailed to public shareholders of the
Corporation at least 30 days prior to the consummation of such
Business Combination (whether or not such proxy or information
statement is required to be mailed pursuant to such Act or
subsequent provisions).
(c) For the purposes of this Article Ninth:
(A) A "person" shall mean any individual, firm, corporation or
other entity.
(B) "Interested Shareholder" shall mean any person (other than
the Corporation or any Subsidiary) who or which:
(1) is the beneficial owner, directly or indirectly, of more
than 20 percent of the combined voting power of the then
outstanding shares of Voting Stock; or
(2) is an Affiliate of the Corporation and at any time within
the two-year period immediately prior to the date in question was
the beneficial owner, directly or indirectly, of 20 percent or more
of the combined voting power of the then outstanding shares of
Voting Stock; or
(3) is an assignee or has otherwise succeeded to the beneficial
ownership of any shares of Voting Stock that were at any time
within the two-year period immediately prior to the date in
question beneficially owned by any Interested Shareholder, if such
assignment or succession shall have occurred in the course of a
transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(C) A person shall be a "beneficial owner" of any Voting Stock:
(1) which such person or any of its Affiliates or Associates
beneficially owns, directly or indirectly; or
(2) which such person or any of its Affiliates or Associates
has (a) the right to acquire (whether such right is exercisable
immediately or only after the passage of time), pursuant to any
agreement, arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or
otherwise, or (b) the right to vote or direct the vote pursuant to
any agreement, arrangement or understanding; or
(3) which are beneficially owned, directly or indirectly, by
any other person with which such person or any of its Affiliates or
Associates has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting or disposing of any shares of
Voting Stock.
(D) For the purposes of determining whether a person is an
Interested Shareholder pursuant to (c)(B) of this Article Ninth, the
number of shares of Voting Stock deemed to be outstanding shall include
shares deemed owned through application of (c)(C) of this Article but
shall not include any other shares of Voting Stock that may be issuable
pursuant to any agreement, arrangement or understanding, or upon
exercise of conversion rights, warrants or options, or otherwise.
(E) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as in effect on
May 25, 1984.
(F) "Subsidiary" means any corporation of which more than 50
percent of the combined voting power of the then outstanding shares of
stock entitled to vote generally in the election of directors is owned,
directly or indirectly, by the Corporation or by a Subsidiary or by the
Corporation and one or more Subsidiaries; provided, however, that for
the purposes of the definition of Interested Shareholder set forth in
(c)(B) of this Article Ninth, the term "Subsidiary" shall mean only a
corporation of which a majority of the combined voting power of the
then outstanding shares of stock entitled to vote generally in the
election of directors is owned, directly or indirectly, by the
Corporation.
(G) "Disinterested Director" means any member of the Board of
Directors of the Corporation who is unaffiliated with, and not a
nominee of, the Interested Shareholder and was a member of the Board
prior to the time that the Interested Shareholder became an Interested
Shareholder, and any successor of a Disinterested Director who is
unaffiliated with, and not a nominee of, the Interested Shareholder and
who is recommended to succeed a Disinterested Director by a majority of
Disinterested Directors then on the Board of Directors.
(H) "Fair Market Value" means: (1) in the case of stock, the
highest closing sale price during the 30-day period immediately
preceding the date in question of a share of such stock on the
principal United States securities exchange registered under the
Securities Exchange Act of 1934 on which such stock is listed, or, if
such stock is not listed on any such exchange, the highest closing
sales price or bid quotation with respect to a share of such stock
during the 30-day period preceding the date in question as quoted by
the National Association of Securities Dealers, Inc. Automated
Quotations Systems or any system then in use, or if no such quotations
are available, the fair market value on the date in question of a share
of such stock as determined by a majority of the Disinterested
Directors in good faith; and (2) in the case of stock of any class or
series which is not traded on any United States registered securities
exchange nor in the over-the-counter market or in the case of property
other than cash or stock, the fair market value of such property on the
date in question as determined by a majority of the Disinterested
Directors in good faith.
(I) In the event of any Business Combination in which the
Corporation survives, the phase "other consideration to be received" as
used in (b)(B)(1) and (2) of this Article Ninth shall include the
shares of the Common Stock and/or the shares of any other class of
outstanding Voting Stock retained by the holders of such shares.
(J) "Announcement Date" means the date of first public announcement
of the proposed Business Combination.
(K) "Determination Date" means the date on which the Interested
Shareholder became an Interested Shareholder.
(L) "Substantial Part" means more than 50 percent of the book value
of the total assets of the entity in question, as of the end of its
most recent fiscal year ending period to the Consummation Date.
(d) A majority of the Disinterested Directors of the Corporation shall
have the right and power to determine, on the basis of information known to them
after reasonable inquiry, all facts necessary to determine compliance with this
Article Ninth, including, without limitation (A) whether a person is an
Interested Shareholder, (B) the number of shares of Voting Stock beneficially
owned by any person, (C) whether a person is an Affiliate or Associate of
another person and (D) whether the requirements of (b) of this Article Ninth
have been met with respect to any Business Combination. The good faith
determination of a majority of the Disinterested Directors on such matters shall
be conclusive and binding for all purposes of this Article Ninth.
(e) Nothing contained in this Article Ninth shall be construed to
relieve any Interested Shareholder from any fiduciary obligation imposed by law.
(f) Notwithstanding anything contained in the Articles of Incorporation
to the contrary, the affirmative vote of the holders of at least 80 percent of
the voting power of the Voting Stock, voting together as a single class, shall
be required to alter, amend, or repeal this Article Ninth or to adopt any
provision inconsistent herewith.