1
RESTATED CERTIFICATE OF INCORPORATION
OF
NTL INCORPORATED
The undersigned, Richard J. Lubasch, certifies that he is the Senior
Vice President, General Counsel and Secretary of NTL Incorporated, a corporation
organized and existing under the laws of the State of Delaware (the
"Corporation"), and does hereby further certify as follows:
(1) The name of the Corporation is NTL Incorporated.
(2) The name under which the Corporation was originally incorporated
was "CCI/Insight CableTel, Inc.," and the original Certificate of Incorporation
was filed with the Secretary of State of the State of Delaware on April 2, 1993.
(3) This Restated Certificate of Incorporation was duly adopted in
accordance with the provisions of Section 245 of the General Corporation Law of
the State of Delaware (the "GCL").
(4) This Restated Certificate of Incorporation only restates and
integrates and does not further amend the provisions of the Corporation's
Certificate of Incorporation as heretofore amended, restated or supplemented,
and there is no discrepancy between those provisions and the provisions of this
Restated Certificate of Incorporation.
(5) The text of the Restated Certificate of Incorporation of the
Corporation is restated to read in its entirety as follows:
FIRST: The name of the Corporation is NTL Incorporated (hereinafter the
"Corporation").
SECOND: The address of the registered office of the Corporation in the State of
Delaware is 9 Loockerman Street, City of Dover 19901, County of Kent. The name
of its registered agent at that address is National Registered Agents, Inc.
THIRD: The purpose of the Corporation is to engage in any lawful act or activity
for which a corporation may be organized under the General Corporation Law of
the State of Delaware as set forth in Title 8 of the Delaware Code (the "GCL").
FOURTH: A. Authorized Capital. The total number of shares of stock which the
Corporation shall have the authority to issue is 410,000,000 shares, consisting
of 400,000,000 shares of common stock, par value $0.01 per share (the "Common
Stock"), and 10,000,000 shares of preferred stock, par value $0.01 per share
(the "Preferred Stock").
B. Designation of Series. Shares of the Preferred Stock of the Corporation
may be issued from time to time in one or more classes or series, each of which
class or series shall have such distinctive designation or title as shall be
fixed by the Board of Directors of the Corporation (the "Board of Directors")
prior to the issuance of any shares thereof. Each such class or series of
Preferred Stock shall have such voting powers, full or limited, or no voting
powers, and such preferences and relative, participating, optional or other
special rights and such qualifications, limitations or restrictions thereof, as
shall be stated in such resolution or resolutions providing for the issue of
such class or series of Preferred Stock as may be adopted from time to time by
the Board of Directors prior to the issuance of any shares thereof pursuant to
the authority hereby expressly vested in it, all in accordance with the laws of
the State of Delaware.
C. Series A Junior Participating Preferred Stock.
Section 1. Designation and Amount. The shares of this series shall
be designated as "Series A Junior Participating Preferred Stock" and the number
of shares constituting such series shall be 1,000,000.
Section 2. Dividends and Distributions.
(1) 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 A Junior Participating Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Participating Preferred 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 fifteenth day of March, June, September and December 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 A Junior Participating Preferred
Stock, in an amount per share (rounded to the nearest cent) equal to the greater
of (a) $.01 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 A Junior Participating Preferred Stock. In the event the
Corporation shall at any time after September 1, 1993 (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 amount to which holders of shares of Series A 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.
(2) The Corporation shall declare a dividend or distribution on the
Series A 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, 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 $.01 per share on the
Series A Junior Participating Preferred Stock shall nevertheless be payable on
such subsequent Quarterly Dividend Payment Date.
(3) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Junior Participating Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares of Series
A 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 A 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 A 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 A Junior Participating Preferred Stock entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be no more
than 30 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Junior
Participating Preferred Stock shall have the following voting rights:
(1) Subject to the provisions for adjustment hereinafter set forth,
each share of Series A Junior Participating Preferred Stock shall entitle the
holder thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation shall at any time
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 number of votes per share to which holders of shares
of Series A 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.
(2) Except as otherwise provided herein or by law, the holders of
shares of Series A Junior Participating Preferred Stock and the holders of
shares of Common Stock shall vote together as one class on all matters submitted
to a vote of stockholders of the Corporation.
(3) (i) If at any time dividends on any Series A Junior Participating
Preferred Stock shall be in arrears in an amount equal to six (6) quarterly
dividends thereon, the occurrence of such contingency shall mark the beginning
of a period (herein called a "default period") which shall extend until such
time when all accrued and unpaid dividends for all previous quarterly dividend
periods and for the current quarterly dividend period on all shares of Series A
Junior Participating Preferred Stock then outstanding shall have been declared
and paid or set apart for payment. During each default period, all holders of
Preferred Stock (including holders of the Series A Junior Participating
Preferred Stock) with dividends in arrears in an amount equal to six (6)
quarterly dividends thereon, voting as a class, irrespective of series, shall
have the right to elect two (2) Directors.
(1) During any default period, such voting right of the holders of
Series A Junior Participating Preferred Stock may be exercised initially at a
special meeting called pursuant to subparagraph (iii) of this Section 3(C) or at
any annual meeting of stockholders, and thereafter at annual meetings of
stockholders, provided that neither such voting right nor the right of the
holders of any other series of Preferred Stock, if any, to increase, in certain
cases, the authorized number of Directors shall be exercised unless the holders
of ten percent (10%) in number of shares of Preferred Stock outstanding shall be
present in person or by proxy. The absence of a quorum of the holders of Common
Stock shall not affect the exercise by the holders of Preferred Stock of such
voting right. At any meeting at which the holders of Preferred Stock shall
exercise such voting right initially during an existing default period, they
shall have the right, voting as a class, to elect Directors to fill such
vacancies, if any, in the Board of Directors as may then exist up to two (2)
Directors or, if such right is exercised at an annual meeting, to elect two (2)
Directors. If the number which may be so elected at any special meeting does not
amount to the required number, the holders of the Preferred Stock shall have the
right to make such increase in the number of Directors as shall be necessary to
permit the election by them of the required number. After the holders of the
Preferred Stock shall have exercised their right to elect Directors in any
default period and during the continuance of such period, the number of
Directors shall not be increased or decreased except by vote of the holders of
Preferred Stock as herein provided or pursuant to the rights of any equity
securities ranking senior to or pari passu with the Series A Junior
Participating Preferred Stock.
(2) Unless the holders of Preferred Stock shall, during an existing
default period, have previously exercised their right to elect Directors, the
Board of Directors may order, or any stockholder or stockholders owning in the
aggregate not less than ten percent (10%) of the total number of shares of
Preferred Stock outstanding, irrespective of series, may request, the calling of
special meeting of the holders of Preferred Stock, which meeting shall thereupon
be called by the President, a Vice-President or the Secretary of the
Corporation. Notice of such meeting and of any annual meeting at which holders
of Preferred Stock are entitled to vote pursuant to this paragraph (C) (iii)
shall be given to each holder of record of Preferred Stock by mailing a copy of
such notice to him at his last address as the same appears on the books of the
Corporation. Such meeting shall be called for a time not earlier than 20 days
and not later than 60 days after such order or request or in default of the
calling of such meeting within 60 days after such order or request, such meeting
may be called on similar notice by any stockholder or stockholders owning in the
aggregate not less than ten percent (10%) of the total number of shares of
Preferred Stock outstanding. Notwithstanding the provisions of this paragraph
(C) (iii), no such special meeting shall be called during the period within 60
days immediately preceding the date fixed for the next annual meeting of the
stockholders.
(3) In any default period, the holders of Common Stock, and other
classes of stock of the Corporation if applicable, shall continue to be entitled
to elect the whole number of Directors until the holders of Preferred Stock
shall have exercised their right to elect two (2) Directors voting as a class,
after the exercise of which right (x) the Directors so elected by the holders of
Preferred Stock shall continue in office until their successors shall have been
elected by such holders or until the expiration of the default period, and (y)
any vacancy in the Board of Directors may (except as provided in paragraph
(C)(ii) of this Section 3) be filled by vote of a majority of the remaining
Directors theretofore elected by the holders of the class of stock which elected
the Director whose office shall have become vacant. References in this paragraph
(C) to Directors elected by the holders of a particular class of stock shall
include Directors elected by such Directors to fill vacancies as provided in
clause (y) of the foregoing sentence.
(4) Immediately upon the expiration of a default period, (x) the right
of the holders of Preferred Stock as a class to elect Directors shall cease, (y)
the term of any Directors elected by the holders of Preferred Stock as a class
shall terminate, and (z) the number of Directors shall be such number as may be
provided for in the certificate of incorporation or by-laws irrespective of any
increase made pursuant to the provisions of paragraph (C)(ii) of this Section 3
(such number being subject, however, to change thereafter in any manner provided
by law or in the certificate of incorporation or bylaws). Any vacancies in the
Board of Directors effected by the provisions of clauses (y) and (z) in the
preceding sentence may be filled by a majority of the remaining Directors.
(4) Except as set forth herein, holders of Series A 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.
2
Section 4. Certain Restrictions.
(1) Whenever quarterly dividends or other dividends or distributions
payable on the Series A 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 A Junior
Participating Preferred Stock outstanding shall have been paid in full, the
Corporation shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series
A Junior Participating Preferred Stock, except dividends paid ratably on
the Series A 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;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series
A Junior Participating Preferred Stock, provided that the Corporation may
at any time redeem, 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 A Junior Participating Preferred Stock;
(iv) purchase or otherwise acquire for consideration any
shares of Series A Junior Participating Preferred Stock, or any shares of
stock ranking on a parity with the Series A 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.
(2) The Corporation shall not permit any subsidiary of the Corporation
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.
Section 5. Reacquired Shares. Any shares of Series A 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 to be created by resolution or resolutions of
the Board of Directors, subject to the conditions and restrictions on issuance
set forth herein.
Section 6. Liquidation, Dissolution or Winding Up.
(1) 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 A Junior Participating Preferred Stock
unless, prior thereto, the holders of shares of Series A Junior Participating
Preferred Stock shall have received $1 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 A Liquidation Preference"). Following
the payment of the full amount of the Series A Liquidation Preference, no
additional distributions shall be made to the holders of shares of Series A
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 A
Liquidation Preference by (ii) 100 (as appropriately adjusted as set forth in
subparagraph C below to reflect such event 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
A Liquidation Preference and the Common Adjustment in respect of all outstanding
shares of Series A Junior Participating Preferred Stock and Common Stock,
respectively, holders of Series A 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 1 with respect to such Preferred Stock and Common Stock, on a per
share basis, respectively.
(2) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference and
the liquidation preferences of all other series of preferred stock, if any,
which rank on a parity with the Series A 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, however, 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.
(3) In the event the Corporation shall at any time 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.
Section 7. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash/or any other property, then in any such case the shares of
Series A 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 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 amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series A 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.
Section 8. No Redemption. The shares of
Series A Junior Participating Preferred Stock shall not be
redeemable.
Section 9. Ranking. The Series A Junior Participating Preferred
Stock shall 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.
Section 10. Amendment. The Restated Certificate 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 A Junior Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of a majority or more of the
outstanding shares of Series A Junior Participating Preferred Stock, voting
separately as a class.
Section 11. Fractional Shares. Series A Junior Participating
Preferred Stock may be issued in fractions of a share which shall entitle the
holder, in proportion to such holder's fractional shares, to exercise voting
rights, receive dividends, participate in distributions and to have the benefit
of all other rights of holders of Series A Junior Participating Preferred Stock.
D. 13% Senior Redeemable Exchangeable Preferred Stock and 13% Series B
Senior Redeemable Exchangeable Preferred Stock. The powers, preferences and
relative, participating, optional and other special rights, and the
qualifications, limitations and restrictions, of the shares of preferred stock
consisting of the series designated the "13% Senior Redeemable Exchangeable
Preferred Stock" and the series designated the "13% Series B Senior Redeemable
Exchangeable Preferred Stock" are as set forth in this Article FOURTH and in
Exhibit A to this Restated Certificate of Incorporation.
E. 9.90% Non-voting Mandatorily Redeemable Preferred Stock, Series A. The
powers, preferences and relative, participating, optional and other special
rights, and the qualifications, limitations and restrictions, of the shares of
preferred stock designated the "9.90% Non-voting Mandatorily Redeemable
Preferred Stock, Series A" are as set forth in this Article FOURTH and in
Exhibit B to this Restated Certificate of Incorporation.
F. 9.90% Non-voting Mandatorily Redeemable Preferred Stock, Series B. The
powers, preferences and relative, participating, optional and other special
rights, and the qualifications, limitations and restrictions, of the shares of
preferred stock designated the "9.90% Non-voting Mandatorily Redeemable
Preferred Stock, Series B" are as set forth in this Article FOURTH and in
Exhibit C to this Restated Certificate of Incorporation.
G. 5 1/4 Convertible Preferred Stock, Series A. The powers, preferences
and relative, participating, optional and other special rights, and the
qualifications, limitations and restrictions, of the shares of preferred stock
designated the "5 1/4% Convertible Preferred Stock, Series A" are as set forth
in this Article FOURTH and in Exhibit D to this Restated Certificate of
Incorporation.
H. 5 1/4% Convertible Preferred Stock, Series B. The powers, preferences
and relative, participating, optional and other special rights, and the
qualifications, limitations and restrictions, of the shares of preferred stock
designated to the "5 1/4% Convertible Preferred Stock, Series B" are as set
forth in this Article FOURTH and in Exhibit E to this Restated Certificate of
Incorporation.
FIFTH: The business and affairs of the Corporation shall be managed by or under
the direction of the Board of Directors. The number of directors of the
Corporation shall be as from time to time fixed by, or in the manner provided
in, the By-laws of the Corporation. The directors shall be divided into three
classes, designated Class I, Class II and Class III. Each class shall consist,
as nearly as may be possible, of one-third of the total number of directors
constituting the entire Board of Directors. The term of the initial Class I
directors shall terminate on the date of the 1994 annual meeting of
stockholders; the term of the initial Class II directors shall terminate on the
date of the 1995 annual meeting of stockholders and the term of the initial
Class III directors shall terminate on the date of the 1996 annual meeting of
stockholders. At each annual meeting of stockholders beginning in 1994,
successors to the class of directors whose term expires at that annual meeting
shall be elected for a three-year term. If the number of directors is changed,
any increase or decrease shall be apportioned among the classes so as to
maintain the number of directors in each class as nearly equal as possible, and
any additional directors of any class elected to fill a vacancy resulting from
an increase in such class shall hold office for a term that shall coincide with
the remaining term of that class, but in no case will a decrease in the number
of directors shorten the term of any incumbent director. A director shall hold
office until the annual meeting for the year in which his term expires and until
his successor shall be elected and shall qualify, subject, however, to prior
death, resignation, retirement, disqualification or removal from office. Any
vacancy on the Board of Directors, howsoever resulting, may be filled by a
majority of the directors then in office, even if less than a quorum, or by a
sole remaining director. Any director elected to fill a vacancy shall hold
office for a term that shall coincide with the term of the class to which such
director shall have been elected.
Notwithstanding the foregoing, whenever the holders of any one or
more classes or series of Preferred Stock issued by the Corporation shall have
the right, voting separately by class or series, to elect directors at an annual
or special meeting of stockholders, the election, term of office, filling of
vacancies and other features of such directorships shall be governed by the
terms of this Certificate of Incorporation or the resolution or resolutions
adopted by the Board of Directors pursuant to Article FOURTH applicable thereto,
and such directors so elected shall not be divided into classes pursuant to this
Article FIFTH unless expressly provided by such terms.
SIXTH: Subject to the rights, if any, of the holders of shares of Preferred
Stock then outstanding, any or all of the directors of the Corporation may be
removed from office at any time, but only for cause and only by the affirmative
vote of the holders of two-thirds (66 2/3%) of the outstanding shares of the
Corporation then entitled to vote generally in the election of directors,
considered for purposes of this Article SIXTH as one class.
SEVENTH: Any action required or permitted to be taken at any annual or special
meeting of stockholders may be taken only upon the vote of the stockholders at
an annual or special meeting duly noticed and called, as provided in the By-laws
of the Corporation, and may not be taken by a written consent of the
stockholders pursuant to the GCL.
EIGHTH: Special meetings of the stockholders of the Corporation for any purpose
or purposes may be called at any time by the Board of Directors, the Chairman of
the Board of Directors or the President. Special meetings of the stockholders of
the Corporation may not be called by any other person or persons.
NINTH:
A. In addition to any affirmative vote required by law or this Certificate
of Incorporation or the By-laws of the Corporation, and except as otherwise
expressly provided in Section B of this Article NINTH, a Business Combination
(as hereinafter defined) with, or proposed by or on behalf of, any Interested
Stockholder (as hereinafter defined) or any Affiliate or Associate (as
hereinafter defined) of any Interested Stockholder or any person who thereafter
would be an Affiliate or Associate of such Interested Stockholder shall require
the affirmative vote of not less than sixty-six and two-thirds percent (66-2/3%)
of the votes entitled to be cast by the holders of all the then outstanding
shares of Voting Stock (as hereinafter defined), voting together as a single
class, excluding Voting Stock beneficially owned by any Interested Stockholder
or any Affiliate or Associate of such Interested Stockholder. Such affirmative
vote shall be required notwithstanding the fact that no vote may be required, or
that a lesser percentage or separate class vote may be specified, by law or in
any agreement with any national securities exchange or otherwise.
B. The provisions of Section A of this Article NINTH shall not be
applicable to any particular Business Combination, and such Business Combination
shall require only such affirmative vote, if any, as is required by law or any
other provision of this Certificate of Incorporation or the By-laws of the
Corporation, if all of the conditions specified in either of the following
Paragraphs 1 or 2 are met:
1. The Business Combination shall have been approved by a majority
of the Continuing Directors (as hereinafter defined).
2. All of the following conditions shall have been met:
a. the aggregate amount of the cash and the Fair Market Value (as
hereinafter defined) as of the date of the consummation of the Business
Combination of consideration other than cash to be received per share by holders
of Common Stock in such Business Combination shall be at least equal to the
highest amount determined under clauses (i) and (ii) below:
(i) (if applicable) the highest per share price
(including any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid by or on behalf of the Interested Stockholder for any
share of Common Stock in connection with the acquisition by the Interested
Stockholder of beneficial ownership of shares of Common Stock acquired by
it (x) within the two-year period immediately prior to the first public
announcement of the proposed Business Combination (the "Announcement
Date") or (y) in the transaction in which it became an Interested
Stockholder, whichever is higher, in either case as adjusted for any
subsequent stock split, stock dividend, subdivision or reclassification
with respect to the Common Stock; and
(ii) the Fair Market Value per share of Common Stock on
the Announcement Date or on the date on which the Interested Stockholder
became an Interested Stockholder (the "Determination Date"), whichever is
higher, as adjusted for any subsequent stock split, stock dividend,
subdivision or reclassification with respect to the Common Stock.
b. The aggregate amount of the cash and the Fair Market Value as of
the date of the consummation of the Business Combination, of consideration other
than cash to be received per share by holders of shares of any class or series
of outstanding Capital Stock (as hereinafter defined), other than Common Stock,
shall be at least equal to the highest amount determined under clauses (i), (ii)
and (iii) below:
(i) (if applicable) the highest per share price
(including any brokerage commissions, transfer taxes and soliciting
dealers' fees) paid by or on behalf of the Interested Stockholder for any
share of such class or series of Capital Stock in connection with the
acquisition by the Interested Stockholder of beneficial ownership of
shares of such class or series of Capital Stock (x) within the two-year
period immediately prior to the Announcement Date or (y) in the
transaction in which it became an Interested Stockholder, whichever is
higher, in either case as adjusted for any subsequent stock split, stock
dividend, subdivision or reclassification with respect to such class or
series of Capital Stock;
(ii) the Fair Market Value per share of such class or
series of Capital Stock on the Announcement Date or on the Determination
Date, whichever is higher, as adjusted for any subsequent stock split,
stock dividend, subdivision or reclassification with respect to such class
or series of Capital Stock; and
(iii) (if applicable) the highest preferential amount
per share to which the holders of shares of such class or series of
Capital Stock would be entitled in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of the
Corporation regardless of whether the Business Combination to be
consummated constitutes such an event.
The provisions of this Paragraph 2 shall be required to be met with respect to
every class or series of outstanding Capital Stock, whether or not the
Interested Stockholder has previously acquired beneficial ownership of any
shares of a particular class or series of Capital Stock.
c. The consideration to be received by holders of a particular class
or series of outstanding Capital Stock shall be in cash or in the same form as
previously has been paid by or on behalf of the Interested Stockholder in
connection with its direct or indirect acquisition of beneficial ownership of
shares of such class or series of Capital Stock. If the consideration so paid
for shares of any class or series of Capital Stock varied as to form, the form
of consideration for such class or series of Capital Stock shall be either cash
or the form used to acquire beneficial ownership of the largest number of shares
of such class or series of Capital Stock previously acquired by the Interested
Stockholder.
d. After the Determination Date and prior to the consummation of
such Business Combination: (i) except as approved by a majority of the
Continuing Directors, there shall have been no failure to declare and pay at the
regular date therefor any full quarterly dividends (whether or not cumulative)
payable in accordance with the terms of any outstanding Capital Stock; (ii)
there shall have been no reduction in the annual rate of dividends paid on the
Common Stock (except as necessary to reflect any stock split, stock dividend or
subdivision of the Common Stock), except as approved by a majority of the
Continuing Directors; (iii) there shall have been an increase in the annual rate
of dividends paid on the Common Stock as necessary to reflect any
reclassification (including any reverse stock split), recapitalization,
reorganization or any similar transaction that has the effect of reducing the
number of outstanding shares of Common Stock, unless the failure so to increase
such annual rate is approved by a majority of the Continuing Directors; and (iv)
such Interested Stockholder shall not have become the beneficial owner of any
additional shares of Capital Stock except as part of the transaction that result
in such Interested Stockholder becoming an Interested Stockholder and except in
a transaction that, after giving effect thereto, would not result in any
increase in the Interested Stockholder's percentage beneficial ownership of any
class or series of Capital Stock.
e. A proxy or information statement describing the proposed Business
Combination and complying with the requirements of the Securities Exchange Act
of 1934, as amended, and the rules and regulations thereunder (the "Act") (or
any subsequent provisions replacing such Act, rules or regulations) shall be
mailed to all stockholders 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). The proxy or information statement shall contain on the
first page thereof, in a prominent place, any statement as to the advisability
(or inadvisability) of the Business Combination that the Continuing Directors,
or any of them, may choose to make and, if deemed advisable by a majority of the
Continuing Directors, an opinion of an investment banking firm selected by a
majority of the Continuing Directors as to the fairness (or unfairness) of the
terms of the Business Combination from a financial point of view to the holders
of the outstanding shares of Capital Stock other than the Interested Stockholder
and its Affiliates or Associates, such investment banking firm to be paid a
reasonable fee for its services by the Corporation.
f. Such Interested Stockholder shall not have made any major change
in the Corporation's business or equity capital structure without the approval
of a majority of the Continuing Directors.
C. The following definitions shall apply with respect to this Article
NINTH:
1. The term "Business Combination" shall mean:
a. any merger or consolidation of the Corporation or any Subsidiary
(as hereinafter defined) with (i) any Interested Stockholder or (ii) any other
company (whether or not itself an Interested Stockholder) which is or after such
merger or consolidation would be an Affiliate or Associate of an Interested
Stockholder; or
b. any sale, lease, exchange, mortgage, pledge, transfer or other
disposition or security arrangement, investment, loan, advance, guarantee,
agreement to purchase, agreement to pay, extension of credit, joint venture
participation or other arrangement (in one transaction or a series of
transactions) with or for the benefit of any Interested Stockholder or any
Affiliate or Associate of any Interested Stockholder involving any assets,
securities or commitments of the Corporation, any Subsidiary or any Interested
Stockholder or any Affiliate or Associate of any Interested Stockholder (except
for any arrangement, whether as employee, consultant or otherwise, other than as
a director, pursuant to which any Interested Stockholder or any Affiliate or
Associate thereof shall, directly or indirectly, have any control over or
responsibility for the management of any aspect of the business or affairs of
the Corporation, with respect to which arrangements the value tests set forth
below shall not apply), together with all other such arrangements (including all
contemplated future events), has an aggregate Fair Market Value and/or involves
aggregate commitments of $5,000,000 or more or constitutes more than 5 percent
of the book value of the total assets (in the case of transactions involving
assets or commitments other than capital stock) or 5 percent of the
stockholders' equity (in the case of transactions in capital stock) of the
entity in question (the "Substantial Part"), as reflected in the most recent
fiscal year-end consolidated balance sheet of such entity existing at the time
the stockholders of the Corporation would be required to approve or authorize
the Business Combination involving the assets, securities and/or commitments
constituting any Substantial Part; or
c. the adoption of any plan or proposal for the
liquidation or dissolution of the Corporation or for any
amendment to the Corporation's By-laws; or
d. 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 Stockholder)
that has the effect, directly or indirectly, of increasing the proportionate
share of any class or series of Capital Stock, or any securities convertible
into Capital Stock or into equity securities of any Subsidiary, that is
beneficially owned by any Interested Stockholder or any Affiliate or Associate
of any Interested Stockholder; or
e. any agreement, contract or other arrangement providing for any
one or more of the actions specified in the foregoing clauses (a) to (d).
2. The term "Capital Stock" shall mean all capital stock of the
Corporation authorized to be issued from time to time under Article FOURTH of
this Certificate of Incorporation, and the term "Voting Stock" shall mean all
Capital Stock which by its terms may be voted on all matters submitted to
stockholders of the Corporation generally.
3. The term "person" shall mean any individual, firm, company or
other entity and shall include any group comprised of any person and any other
person with whom such person or any Affiliate or Associate of such person has
any agreement, arrangement or understanding, directly or indirectly, for the
purpose of acquiring, holding, voting or disposing of Capital Stock.
4. The term "Interested Stockholder" shall mean any person (other
than the Corporation or any Subsidiary and other than any profit-sharing,
employee stock ownership or other employee benefit plan of the Corporation or
any Subsidiary or any trustee of or fiduciary with respect to any such plan when
acting in such capacity who (a) is or has announced or publicly disclosed a plan
or intention to become the beneficial owner of Voting Stock representing fifteen
percent (15%) or more of the votes entitled to be cast by the holders of all
then outstanding shares of Voting Stock; or (b) is an Affiliate or Associate of
the Corporation and at any time within the two-year period immediately prior to
the date in question was the beneficial owner of Voting Stock representing
fifteen percent (15%) or more of the votes entitled to be cast by the holders of
all then outstanding shares of Voting Stock.
5. A person shall be a "beneficial owner" of any Voting Stock: (a)
which such person or any of its Affiliates or Associates beneficially owns,
directly or indirectly; (b) which such person or any of its Affiliates or
Associates has, directly or indirectly, (i) the right to acquire (whether such
right is exercisable immediately or subject only to the passage of time),
pursuant to any agreement, arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise, or (ii)
the right to vote pursuant to any agreement, arrangement or understanding; or
(c) which is beneficially owned, directly or indirectly, by any other person
with which such person or any of its Affiliates or Associates has any agreement,
arrangement or understanding for the purpose of acquiring, holding, voting or
disposing of any shares of Capital Stock. For the purposes of determining
whether a person is an Interested Stockholder pursuant to Paragraph 4 of this
Section C, the number of shares of Capital Stock deemed to be outstanding shall
include shares deemed beneficially owned by such person through applications of
this Paragraph 5 of Section C, but shall not include any other shares of Capital
Stock that may be issuable pursuant to an agreement, arrangement or
understanding, or upon exercise of conversion rights, warrants or options, or
otherwise.
6. The terms "Affiliate" or "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Act, as in effect on April 2, 1993 (the term "registrant"
in said Rule 12b-2 meaning in this case the Corporation).
7. "Subsidiary" means any company of which a majority of any class
of equity security is beneficially owned by the Corporation; provided, however,
that for the purposes of the definition of Interested Stockholder set forth in
Paragraph 4 of this Section C, the term "Subsidiary" shall mean only a company
of which a majority of each class of equity security is beneficially owned by
the Corporation.
8. The term "Continuing Director" means any member of the Board of
Directors of the Corporation, while such person is a member of the Board of
Directors, who is not an Affiliate or Associate or representative of the
Interested Stockholder and was a member of the Board of Directors prior to the
time that the Interested Stockholder became an Interested Stockholder, and any
successor of a Continuing Director while such successor is a member of the Board
of Directors, who is not an Affiliate or Associate or representative of the
Interested Stockholder and is recommended or elected to succeed the Continuing
Director by a majority of Continuing Directors.
9. The term "Fair Market Value" means: (a) in the case of cash, the
amount of such cash; (b) 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 Composite Tape for New York Stock Exchange-Listed Stocks,
or, if such stock is not quoted on the Composite Tape, on the New York Stock
Exchange, or, if such stock is not listed on such Exchange, on the principal
United States securities exchange registered under the Act on which such stock
is listed or, if such stock is not listed on any such exchange, the highest
closing bid quotation with respect to a share of such stock during the 30-day
period preceding the date in question on the National Association of Securities
Dealers, Inc. Automated Quotations System, in the pink sheets of the National
Quotation Bureau or any similar system then in use, or if no such quotations are
available, the fair market value on the date in question of a share of such
stock as determined by a majority of the Continuing Directors in good faith; and
(c) in the case of property other than cash or stock, the fair market value of
such property on the date in question as determined in good faith by a majority
of the Continuing Directors.
10. In the event of any Business Combination in which the
Corporation survives, the phrase "consideration other than cash to be received"
as used in Paragraphs 2.a. and 2.b. of Section B of this Article NINTH shall
include the shares of Common Stock and/or the shares of any other class or
series of Capital Stock retained by the holders of such shares.
D. A majority of the Continuing Directors shall have the power and duty to
determine for the purpose of this Article NINTH, on the basis of information
known to them after reasonable inquiry, all questions arising under this Article
NINTH, including, without limitation, (a) whether a person is an Interested
Stockholder, (b) the number of shares of Capital Stock or other securities
beneficially owned by any person, (c) whether a person is an Affiliate or
Associate of another, (d) whether a Proposed Action (as hereinafter defined) is
with, or proposed by, or on behalf of an Interested Stockholder or an Affiliate
or Associate of an Interested Stockholder, (e) whether the assets that are the
subject of any Business Combination have, or the consideration to be received
for the issuance or transfer of securities by the Corporation or any Subsidiary
in any Business Combination has, an aggregate Fair Market Value of $5,000,000 or
more, and (f) whether the assets or securities that are the subject of any
Business Combination constitute a Substantial Part. Any such determination made
in good faith shall be binding and conclusive on all parties. The good faith
determination of a majority of the Continuing Directors on such matters shall be
conclusive and binding for all purposes of this Article NINTH.
E0 Nothing contained in this Article NINTH shall be construed to relieve
any Interested Stockholder from any fiduciary obligation imposed by law.
F0 The fact that any Business Combination complies with the provisions of
Section B of this Article NINTH shall not be construed to impose any fiduciary
duty, obligation or responsibility on the Board of Directors, or any member
thereof, to approve such Business Combination or recommend its adoption or
approval to the stockholders of the Corporation, nor shall such compliance
limit, prohibit or otherwise restrict in any manner the Board of Directors, or
any member thereof, with respect to evaluations of or actions and responses
taken with respect to such Business Combination.
G0 For the purposes of this Article NINTH, a Business Combination or any
proposal to amend, repeal or adopt any provision of this Certificate of
Incorporation inconsistent with this Article NINTH (collectively, "Proposed
Action") is presumed to have been proposed by, or on behalf of, an Interested
Stockholder or an Affiliate or Associate of an Interested Stockholder or a
person who thereafter would become such if (1) after the Interested Stockholder
became such, the Proposed Action is proposed following the election of any
director of the Corporation who with respect to such Interested Stockholder,
would not qualify to serve as a Continuing Director or (2) such Interested
Stockholder, Affiliate, Associate or person votes for or consents to the
adoption of any such Proposed Action, unless as to such Interested Stockholder,
Affiliate, Associate or person a majority of the Continuing Directors makes a
good faith determination that such Proposed Action is not proposed by or on
behalf of such Interested Stockholder, Affiliate, Associate or person, based on
information known to them after reasonable inquiry.
H0 Notwithstanding any other provisions of this Certificate of
Incorporation or the By-laws of the Corporation (and notwithstanding the fact
that a lesser percentage or separate class vote may be specified by law, this
Certificate of Incorporation or the By-laws of the Corporation), any proposal to
amend, repeal or adopt any provision of this Certificate of Incorporation
inconsistent with this Article NINTH which is proposed by or on behalf of an
Interested Stockholder or an Affiliate or Associate of an Interested Stockholder
shall require the affirmative vote of the holders of not less than sixty-six and
two-thirds percent (66-2/3%) of the votes entitled to be cast by the holders of
all the then outstanding shares of Voting Stock, voting together as a single
class, excluding Voting Stock beneficially owned by such Interested Stockholder;
provided, however, that this Section H shall not apply to, and such sixty-six
and two-thirds percent (66-2/3%) vote shall not be required for, any amendment,
repeal or adoption unanimously recommended by the Board of Directors if all of
such directors are persons who would be eligible to serve as Continuing
Directors within the meaning of Section C, Paragraph 8 of this Article NINTH.
TENTH: No director of the Corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for any breach of fiduciary
duty by such a director as a director. Notwithstanding the foregoing sentence, a
director shall be liable to the extent provided by applicable law (i) for any
breach of the director's duty of loyalty to the Corporation or its stockholders,
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the
GCL or (iv) for any transaction from which the director derived an improper
personal benefit. No amendment to or repeal to this Article TENTH shall apply to
or have any effect on the liability or alleged liability of any director of the
Corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.
ELEVENTH: In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to adopt, repeal, alter,
amend or rescind the By-laws of the Corporation. In addition, the By-laws of the
Corporation may be adopted, repealed, altered, amended, or rescinded by the
affirmative vote of sixty-six and two-thirds percent (66-2/3%) of the
outstanding stock of the Corporation entitled to vote thereon.
TWELFTH: Notwithstanding anything contained in this Certificate of Incorporation
to the contrary, the affirmative vote of the holders of at least sixty-six and
two-thirds percent (66-2/3%) of the Voting Stock, voting together as a single
class, shall be required to amend, repeal or adopt any provision inconsistent
with Articles FIFTH, SEVENTH, EIGHTH, NINTH, TENTH, and ELEVENTH of this
Certificate of Incorporation.
THIRTEENTH: The Corporation reserves the right to repeal, alter, amend, or
rescind any provision contained in this Restated Certificate of Incorporation,
in the manner now or hereafter prescribed by statute, and all rights conferred
on stockholders herein are granted subject to this reservation.
IN WITNESS WHEREOF, NTL Incorporated has caused this Restated
Certificate of Incorporation to be signed by Richard J. Lubasch, its Senior Vice
President, General Counsel and Secretary, this 29th day of March, 1999.
___
NTL INCORPORATED
/S/ Richard J. Lubasch
By:___________________________________
Richard J. Lubasch
Senior Vice President, General
Counsel and Secretary
3
Exhibit A
13% SENIOR REDEEMABLE EXCHANGEABLE PREFERRED STOCK
AND
13% SERIES B SENIOR REDEEMABLE EXCHANGEABLE
PREFERRED STOCK
a) Designation. There is hereby created out of the authorized and
unissued shares of preferred stock of the Corporation a class of preferred stock
consisting of two series, one designated as the "13% Senior Redeemable
Exchangeable Preferred Stock" (the "Series A Preferred") and the other
designated as the "13% Series B Senior Redeemable Exchangeable Preferred Stock"
(the "Series B Pre ferred"). The number of shares constituting such class shall
be 100,000 plus up to 150,000 shares issued in lieu of cash dividends, and are
referred to as the "Preferred Stock." The liquidation preference of the
Preferred Stock shall be $1,000.00 per share.
b) Rank. The Preferred Stock shall, with respect to dividends and
distributions upon liquidation, winding-up and dissolution of the Corporation,
rank (i) senior to (a) all classes of Common Stock, (b) the Junior Preferred
Stock, (c) the 5% Preferred Stock and (d) each other class of Capital Stock or
series of preferred stock issued by the Corporation after the Issue Date the
terms of which specifically provide that such class or series will rank junior
to the Preferred Stock as to dividend distributions and distributions upon
liquidation, winding-up and dissolution of the Corporation or junior to or on a
parity with any class of common stock of the Corporation or which do not specify
their rank (the securities described in this clause (i), collectively, "Junior
Securities"); (ii) on a parity with each class of Capital Stock or series of
preferred stock issued by the Corporation after the Issue Date the terms of
which specifically provide that such class or series will rank on a parity with
the Preferred Stock as to dividend distributions and distributions upon
liquidation, winding-up and dissolution of the Corporation (the securities
described in this clause (ii), collectively, "Parity Securities"); and (iii)
junior to each other class of Capital Stock or other series of preferred stock
issued by the Corporation after the Issue Date the terms of which specifically
provide that such series will rank senior to the Preferred Stock as to dividend
distributions and distributions upon liquidation, winding-up and dissolution of
the Corporation (the securities described in this clause (iii), collectively,
"Senior Securities").
c) Dividends.
d) Beginning on the Issue Date, the Holders of the outstanding
shares of Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors, out of funds legally available therefor, dividends on
the Preferred Stock at a rate equal to 13% per annum ($130 per share). Dividends
will accrue from
4
the Issue Date and will be payable quarterly in arrears on February 15, May 15,
August 15 and November 15 of each year (each, a "Dividend Payment Date"),
commencing on May 15, 1997. Dividends, whether or not earned or declared, will
accrue without interest until declared and paid, which declaration may be for
all or part of the accrued dividends. Dividends accruing on or prior to February
15, 2004 may, at the option of the Corporation, be paid (i) in cash, (ii) by the
issuance of such number of additional fully paid and nonassessable shares
(including fractional shares) of Preferred Stock equal to the amount of such
dividends then payable divided by $1,000 or (iii) in any combination of the
foregoing. Each dividend shall be payable to the Holders of record as they
appear on the stock books of the Corporation on such record date as may be fixed
by the Board of Directors, which record date will not be less than 10 nor more
than 60 days prior to the applicable Dividend Payment Date. Dividends shall
cease to accrue in respect of the Preferred Stock on the Exchange Date or on the
date of their earlier redemption or repurchase by the Corporation, unless the
Corporation shall have failed to issue the appropriate aggregate principal
amount of Subordinated Debentures in respect of the Preferred Stock on such
Exchange Date or shall have failed to pay the relevant redemption or repurchase
price on the date fixed for redemption or repurchase. All dividends paid with
respect to shares of the Preferred Stock shall be paid pro rata to the Holders
entitled thereto.
e) No full dividends may be declared or paid or funds set
apart for the payment of dividends on any Parity Securities for any period
unless all accrued dividends have been or contemporaneously are declared and
paid in full or declared and, if payable in cash, a sum in cash is set apart
sufficient for such payment on the Preferred Stock. If all accrued dividends
have not been so paid, the Preferred Stock shall share dividends pro rata with
the Parity Securities based upon the relative liquidation preferences of the
outstanding shares of the Preferred Stock and such Parity Securities. No
dividends may be declared or paid, nor may funds be set aside for such payment,
on Junior Securities, except dividends on Junior Securities which are paid in
additional Junior Securities (other than Disqualified Capital Stock), and no
Parity Securities or Junior Securities may be repurchased, redeemed or otherwise
retired, nor may funds be set apart for such payment, if all accrued dividends
have not been paid (or deemed to have been paid) on the Preferred Stock.
f) In the event that (a) the Exchange Offer Registration State
ment is not filed with the Commission on or prior to the 75th day following the
Issue Date, (b) the Exchange Offer Registration Statement is not declared
effective prior to the 120th day following the Issue Date, (c) the Registered
Exchange Offer is not consummated on or prior to the 160th day following the
Issue Date or (d) if the Corporation is obligated to file the Shelf Registration
Statement under the Registration Rights Agreement and the Shelf Registration
Statement is not declared effective on or prior to 160 days after the Issue Date
(in each of cases (b), (c) and (d), as such period may be extended in accordance
with the proviso of Section 2(a) of the Registration Rights Agreement) (each
such event referred to in clauses (a) through (d) above, a "Registration
Default"), dividends will accrue on the Preferred Stock (in addition to the
stated dividends on the Preferred Stock) from and including the next day
following each of (i) such 75-day period in the case of clause (a) above, (ii)
such 120-day period in the case of clause (b) above, (iii) such 160-day period
in the case of clause (c) above and (iv) such 160-day period in the case of
clause (d) above (in each of cases (b), (c) and (d) as such period is extended,
if applicable, in the manner aforesaid) (each such period referred to in clauses
(i) through (iv) above, an "Accrual Period"), at a rate per annum equal to 0.50%
of the liquidation preference of the Preferred Stock (determined daily). The
amount of such additional dividends (the "Special Dividends") will increase by
an additional 0.50% per annum with respect to each subsequent applicable Accrual
Period until all Registration Defaults have been cured, up to a maximum of
Special Dividends of 1.50% per annum of the liquidation preference (determined
daily). In each case, such additional dividends (the "Special Dividends") will
be payable quarterly in arrears each May 15, August 15, November 15 and February
15, commencing May 15, 1997, to Holders of record on the immediately preceding
May 1, August 1, November 1 and February 1, respectively.
In the event that a Shelf Registration Statement is declared effective
pursuant to the Registration Rights Agreement, if the Corporation fails to keep
the Shelf Registration Statement continuously effective for the period required
by the Registration Rights Agreement, then from such time as the Shelf
Registration is no longer effective until the earliest of (i) the date that the
Shelf Registration Statement is again deemed effective, (ii) the date that is
the third anniversary of the Issue Date or (iii) the date as of which all of the
Transfer Restricted Securities are sold pursuant to the Shelf Registration
Statement, Special Dividends shall accrue at a rate per annum equal to 0.50% of
the liquidation preference of the Preferred Stock (1.00% thereof if the Shelf
Registration Statement is no longer effective for 30 days or more) and shall be
payable quarterly in arrears each May 15, August 15, November 15 and February
15, commencing May 15, 1997, to Holders of record on the immediately preceding
May 1, August 1, November 1 and February 1, respectively.
g) Nothing herein contained shall in any way or under any
circumstances be construed or deemed to require the Board of Directors to
declare, or the Corporation to pay or set apart for payment, any dividends on
shares of the Preferred Stock at any time. In the event that the Corporation
fails to pay dividends, the sole remedy available to Holders will be the
election of directors as set forth in paragraph (f)(ii).
h) Accrued dividends may be declared and paid at any time,
without reference to any regular Dividend Payment Date, to Holders of record,
not more than sixty (60) days prior to payment thereof, as may be fixed by the
Board of Directors of the Corporation.
i) Dividends payable on the Preferred Stock for any period
less than a year shall be computed on the basis of a 360-day year of twelve
30-day months and the actual number of days elapsed in the period for which such
dividends are payable.
j) References in this Resolution to "dividends" include
Special Dividends unless the context requires otherwise.
k) Liquidation Preference.
l) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Corporation, the Holders of
shares of Preferred Stock then outstanding shall be entitled to be paid out of
the assets of the Corporation available for distribution to its stockholders, an
amount in cash equal to the liquidation preference for each share outstanding,
plus an amount in cash equal to accrued and unpaid dividends thereon, if any, to
the date fixed for liquidation, dissolution or winding up (including an amount
in cash equal to a prorated dividend for the period from the last Dividend
Payment Date to the date fixed for liquidation, dissolution or winding up),
before any distribution shall be made or any assets distributed to the holders
of any of the Junior Securities including, without limitation, any Common Stock.
Except as provided in the preceding sentence, Holders shall not be entitled to
any distribution in the event of any liquidation, dissolution or winding up of
the affairs of the Corporation. If the assets of the Corporation are not
sufficient to pay in full the liquidation payments payable to the holders of
outstanding shares of the Preferred Stock and all Parity Securities, then the
holders of all such shares shall share equally and ratably in such distribution
of assets of the Corporation in proportion to the full liquidation preference to
which each is entitled. After payment in full of the liquidation preference to
which Holders are entitled, such Holders will not be entitled to any further
participation in any distribution of assets of the Corporation.
m) For the purposes of this paragraph (d), neither the sale,
conveyance, exchange or transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all of the property or assets of the
Corporation nor the consolidation or merger of the Corporation with or into one
or more entities shall be deemed to be a liquidation, dissolution or winding up
of the affairs of the Corporation.
n) Redemption.
o) Optional Redemption. () The Corporation may, at the option
of the Board of Directors, redeem in whole at any time or in part from time to
time, in the manner provided for in paragraph (e)(iii) hereof, any or all of the
shares of Preferred Stock, at the redemption prices (expressed as percentages of
the liquidation preference thereof) set forth below plus all accrued and unpaid
dividends (including an amount in cash equal to a prorated dividend for the
period from the Dividend Payment Date immediately prior to the Redemption Date
to the Redemption Date) (the "Optional Redemption Price") if redeemed during the
12-month period beginning February 15 of each of the years set forth below:
2002 106.500%
- ---------------------------------------------------------
- ---------------------------------------------------------
2003 104.333%
- ---------------------------------------------------------
- ---------------------------------------------------------
2004 102.167%
- ---------------------------------------------------------
- ---------------------------------------------------------
2005 and thereafter 100.000%
p) Upon a Change of Control Call Event, the Corporation will have
the option to redeem all (but not less than all) of the outstanding shares of
Preferred Stock at a redemption price (the "Change of Control Call Price") equal
to 100% of the liquidation preference thereof, plus the Applicable Premium, plus
accrued and unpaid dividends to the date of repurchase; provided, however, no
such redemption shall be consummated except contemporaneously with or after the
merger, consolidation or business combination referred to in the definition of
Change of Control Call Event. Notwithstanding anything to the contrary in
paragraph (e)(iii), notice of any such redemption pursuant to this paragraph
must be given no later than 90 days following the date upon which the Change of
Control Call Event occurred (or no later than 10 days after the date on which a
notice of a Change of Control Offer must be mailed pursuant to paragraph (h) if
the events giving rise to the Change of Control Call Event also give rise to a
Change of Control Triggering Event), and the purchase date must be within 30
days of the date of notice.
q) In the event of a redemption pursuant to paragraph (e)(i)(A) or
(B) hereof of only a portion of the then outstanding shares of the Preferred
Stock, the Corporation shall effect such redemption on a pro rata basis
according to the number of shares held by each Holder of the Preferred Stock,
except that the Corporation may redeem such shares held by Holders of fewer than
10 shares (or all shares held by Holders who would hold less than 10 shares as a
result of such redemption), as may be determined by the Corporation. No partial
redemption of the Preferred Stock may be authorized or made unless prior thereto
all accrued dividends thereon shall have been paid in cash or declared and a sum
set apart for such payment.
r) Mandatory Redemption. On February 15, 2009, the Corpora
tion shall redeem, to the extent of funds legally available therefor, in the
manner provided for in paragraph (e)(iii) hereof, all of the shares of the
Preferred Stock then outstanding at a redemption price equal to 100% of the
liquidation preference per share, plus an amount in cash equal to all accrued
and unpaid dividends per share (including an amount equal to a prorated dividend
for the period from the Dividend Payment Date immediately prior to the
Redemption Date to the Redemption Date) (the "Mandatory Redemption Price").
s) Procedures for Redemption. () At least fifteen (15) days
and not more than sixty (60) days prior to the date fixed for any redemption of
the Preferred Stock, written notice (the "Redemption Notice") shall be given by
first class mail, postage prepaid, to each Holder of record on the record date
fixed for such redemption of the Preferred Stock at such Holder's address as it
appears on the stock books of the Corporation; provided, however, that no
failure to give such notice nor any deficiency therein shall affect the validity
of the procedure for the redemption of any shares of Preferred Stock to be
redeemed except as to the Holder or Holders to whom the Corporation has failed
to give said notice or to whom such notice was defective. If any Preferred Stock
is to be redeemed in part only, the Redemption Notice that relates to such
Preferred Stock will state the number of shares thereof to be redeemed. Shares
of Preferred Stock that have been issued and reacquired in any manner, including
shares purchased or redeemed or exchanged, will (upon compliance with any
applicable provisions of Delaware law) have the status of authorized but
unissued shares of preferred stock of the Corporation undesignated as to series
and may, with any and all other authorized but unissued shares of preferred
stock of the Corporation, be designated or redesignated and issued or reissued,
as the case may be, as part of any series of preferred stock of the Corporation,
except that such shares may not be reissued or sold as shares of the Preferred
Stock (other than in payment of dividends on the Preferred Stock). The
Redemption Notice shall state:
t) whether the redemption is pursuant to
paragraph (e)(i)(A), (e)(i)(B) or (e)(ii) hereof;
u) the Optional Redemption Price, the Change of Control Call Price or the
Mandatory Redemption Price, as the case may be;
v) whether all or less than all the outstanding shares of the Preferred Stock
are to be redeemed and the total number of shares of the Preferred Stock being
redeemed;
w) the date fixed for redemption;
x) that the Holder is to surrender to the Corporation, in the manner, at the
place or places and at the price designated, such Holder's certificate or
certificates representing the shares of Preferred Stock to be redeemed; and
y) that dividends on the shares of the Preferred Stock to be redeemed shall
cease to accrue on such Redemption Date unless the Corporation defaults in the
payment of the Optional Redemption Price, the Change of Control Call Price or
the Mandatory Redemption Price, as the case may be.
z) Each Holder of shares of Preferred Stock shall surrender the
certifi cate or certificates representing such shares to the Corporation, duly
endorsed (or otherwise in proper form for transfer, as determined by the
Corporation), in the manner and at the place designated in the Redemption
Notice, and on the Redemption Date the full Optional Redemption Price, the
Change of Control Call Price or the Mandatory Redemption Price, as the case may
be, for such shares shall be payable in cash to the Person whose name appears on
such certificate or certificates as the owner thereof, and each surrendered
certificate shall be canceled and retired. In the event that less than all of
the shares represented by any such certificate are redeemed, a new certificate
shall be issued representing the unredeemed shares.
aa) On the Redemption Date, unless the Corporation defaults in the
payment in full of the applicable redemption price, dividends on the Preferred
Stock called for redemption shall cease to accrue, and all rights of the Holders
of redeemed shares shall terminate with respect thereto, other than the right to
receive the Optional Redemption Price, the Change of Control Call Price or the
Mandatory Redemption Price, as the case may be, without interest; provided,
however, that if a notice of redemption shall have been given as provided in
paragraph (iii)(A) above and the funds necessary for redemption (including an
amount in respect of all dividends that will accrue to the Redemption Date)
shall have been irrevocably deposited in trust for the equal and ratable benefit
for the Holders of the shares to be redeemed, then, at the close of business on
the day on which such funds are segregated and set aside, the Holders of the
shares to be redeemed shall cease to be stockholders of the Corporation and
shall be entitled only to receive the Optional Redemption Price, the Change of
Control Call Price or the Mandatory Redemption Price, as the case may be,
without interest.
ab) Voting Rights.
ac) The Holders of Preferred Stock, except as otherwise
required under Delaware law or as set forth in this paragraph (f), shall not be
entitled or permitted to vote on any matter required or permitted to be voted
upon by the stockholders of the Corporation.
ad) If (a) dividends on the Preferred Stock are in arrears and
unpaid (after February 15, 2004, in cash) for six quarterly periods (whether or
not consecutive), (b) the Corporation fails to effect a redemption of the
Preferred Stock when required by, and in accordance with, paragraph (e)(ii) or
(c) the Corporation fails to make an offer to purchase all of the outstanding
shares of Preferred Stock following a Change of Control Triggering Event, if
such offer to purchase is required by paragraph (h), or fails to purchase all of
the shares of Preferred Stock validly tendered pursuant thereto (each such event
described in clauses (a) through (c) above being referred to herein as a "Voting
Rights Triggering Event"), then the number of directors constituting the Board
of Directors of the Corporation will be increased by two and the holders of the
majority of the then outstanding shares of Preferred Stock, voting separately as
a class, will be entitled to elect the two additional directors. Such voting
rights will continue until such time as, in the case of a default under clause
(a), all accrued dividends on the Preferred Stock are paid in full and, in all
other cases, any failure, breach or default referred to in clause (b) or (c) is
remedied, at which time the term of any directors elected pursuant to the
provisions of this paragraph shall immediately terminate. Any vacancy occurring
in the office of a director elected by the Holders may be filled by the
remaining director elected by such holders unless and until such vacancy shall
be filled by such holders. Regardless of the number of Voting Rights Triggering
Events, in no event shall the Holders have the right to elect and have serve
more than two members of the Board of Directors of the Corporation at any one
time.
At any time after voting power to elect directors shall have become
vested and be continuing in the Holders of shares of the Preferred Stock
pursuant to this paragraph (f)(ii), or if vacancies shall exist in the offices
of directors elected by the Holders of shares of the Preferred Stock, a proper
officer of the Corporation may, and upon the written request of the Holders of
record of at least 10% of the shares of Preferred Stock then outstanding
addressed to the Secretary of the Corporation shall, call a special meeting of
the Holders of Preferred Stock, for the purpose of electing the directors which
such Holders are entitled to elect. If such meeting shall not be called by the
proper officer of the Corporation within 20 days after personal service of said
written request upon the Secretary of the Corporation, or within 20 days after
mailing the same within the United States by certified mail, addressed to the
Secretary of the Corporation at its principal executive offices, then the
Holders of record of at least 20% of the outstanding shares of the Preferred
Stock may designate in writing one of their number to call such meeting at the
expense of the Corporation, and such meeting may be called by the Person so
designated upon the notice required for the annual meetings of stockholders of
the Corporation and shall be held at the place for holding the annual meetings
of stockholders or such other place in the United States as shall be designated
in such notice. Notwithstanding the foregoing, no such special meeting shall be
called if any such request is received less than 30 days before the date fixed
for the next ensuing annual or special meeting of stockholders of the
Corporation. Any Holder of shares of the Preferred Stock so designated shall
have, and the Corporation shall provide, access to the lists of Holders of
shares of the Preferred Stock for purposes of calling a meeting pursuant to the
provisions of this paragraph (f)(ii).
ae) The Corporation shall not, without the affirmative vote or
consent of Holders of a majority of the shares of Preferred Stock then
outstanding, voting or consenting, as the case may be, separately as one class,
given in person or by proxy, either in writing or by resolution adopted at an
annual or special meeting, (x) create, authorize or issue any class of Senior
Securities or Parity Securities or (y) amend the Certificate of Designation so
as to affect adversely the specified rights, preferences, privileges or voting
rights of holders of Preferred Stock or authorize the issuance of any additional
shares of Preferred Stock (other than in payment of dividends on the Preferred
Stock); provided, however, that the Corporation may, without the approval of any
Holders, issue or have outstanding shares of Parity Securities (other than
Disqualified Capital Stock) issued from time to time in exchange for, or all of
the proceeds of which are used to redeem or repurchase, any or all of the shares
of Preferred Stock. The Holders of a majority of the outstanding shares of
Preferred Stock, voting or consenting, as the case may be, separately as one
class, may waive compliance with any provision of the Certificate of
Designation. Except as set forth in this paragraph (f)(iii), neither (a) the
creation, authorization or issuance of any shares of Junior Securities, Parity
Securities or Senior Securities, including the designation of a series thereof
within the existing class of Preferred Stock, nor (b) the increase or decrease
in the amount of authorized capital stock of any class, including any preferred
stock, shall require the consent of any Holders or shall be deemed to affect
adversely the rights, preferences, privileges or voting rights of shares of
Preferred Stock.
5
af) Without the affirmative vote or consent of Holders of a
majority of the issued and outstanding shares of Preferred Stock, voting or
consenting, as the case may be, as one class, given in person or by proxy,
either in writing or by resolution adopted at an annual or special meeting, the
Corporation shall not, in a single transaction or series of related
transactions, consolidate or merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of its assets to,
another Person or adopt a plan of liquidation unless: (A) either (1) the
Corporation is the surviving or continuing Person or (2) the Person (if other
than the Corporation) formed by such consolidation or into which the Corporation
is merged or the Person that acquires by conveyance, transfer or lease the
properties and assets of the Corporation as an entirety or substantially as an
entirety or in the case of a plan of liquidation, the Person to which assets of
the Corporation have been transferred, shall be a corporation, partnership or
trust organized and existing under the laws of the United States or any State
thereof or the District of Columbia; (B) the Preferred Stock shall be converted
into or exchanged for and shall become shares of such successor, transferee or
resulting Person, having in respect of such successor, transferee or resulting
Person the same powers, preferences and relative, participating, optional or
other special rights and the qualifications, limitations or restrictions thereon
that the Preferred Stock had immediately prior to such transaction, and (C) the
Corporation has delivered to the transfer agent for the Preferred Stock prior to
the consummation of the proposed transaction an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger or transfer
complies with the terms hereof and that all conditions precedent herein relating
to such transaction have been satisfied. For purposes of the foregoing, the
transfer (by lease, assignment, sale or otherwise, in a single transaction or
series of related transactions) of all or substantially all of the properties or
assets of one or more subsidiaries of the Corporation, the Capital Stock of
which constitutes all or substantially all of the properties and assets of the
Corporation shall be deemed to be the transfer of all or substantially all of
the properties and assets of the Corporation.
ag) On or prior to the Exchange Date, the Corporation shall
not amend or modify the form of Indenture (except as expressly provided therein
in respects of amendments without the consent of holders of Subordinated
Debentures) without the affirmative vote or consent of Holders of at least a
majority of the shares of Preferred Stock then outstanding, voting or
consenting, as the case may be, as one class, given in person or by proxy,
either in writing or by resolution adopted at an annual or special meeting.
ah) In any case in which the Holders shall be entitled to vote
as described herein or pursuant to Delaware law, each Holder shall be entitled
to one vote for each share of Preferred Stock held by such Holder.
ai) Exchange.
aj) Requirements. On any Dividend Payment Date, the Corpora
tion may, at its option, exchange the Preferred Stock, in whole but not in part,
for the Subordinated Debentures; provided, however, that any such exchange may
only be made if on or prior to the date of such exchange (i) the Corporation has
paid all accrued dividends on the Preferred Stock (including the dividends
payable on the Exchange Date) and there shall be no contractual impediment to
such exchange; (ii) there shall be funds legally available sufficient therefor;
(iii) the Indenture has been qualified under the Trust Indenture Act of 1939, as
amended, if required at the time of such exchange for public indentures; and
(iv) the Corporation shall have delivered an Officers' Certificate and an
Opinion of Counsel to the effect that all conditions to be satisfied prior to
such exchange have been satisfied. Holders of Preferred Stock so exchanged will
be entitled to receive $1.00 in principal amount of Subordinated Debentures for
each $1.00 of liquidation preference of Preferred Stock held by such holder at
the time of exchange. In connection with any such exchange, dividends on shares
of Preferred Stock exchanged which have accrued on or prior to February 15, 2004
which have not been paid as of the Exchange Date shall be paid, at the
Corporation's option, in cash, in additional Subordinated Debentures in an
equivalent principal amount of such accrued and unpaid dividends or in a
combination of the foregoing. Dividends on any shares of Preferred Stock
accruing after February 15, 2004 which have not been paid as of the Exchange
Date must be paid in cash on the Exchange Date. On the Exchange Date, all
dividends on the Preferred Stock will cease to accrue. Subordinated Debentures
issued in exchange for Preferred Stock will be issued in principal amounts of
$1,000 and integral multiples thereof to the extent possible, and will also be
issued in principal amounts of less than $1,000 so that each holder of Preferred
Stock will receive certificates representing the entire amount of Subordinated
Debentures to which its shares of Preferred Stock entitle it; provided, however,
that the Corporation may, at its option, pay cash in lieu of issuing a
Subordinated Debenture in a principal amount less than $1,000.
6
ak) Procedures. The Corporation shall send by first-class
mail, postage prepaid, to each Holder of record on the record date fixed for
such exchange of Preferred Stock, at such Holder's address as the same appears
on the stock books of the Corporation, written notice (the "Exchange Notice") of
its intention to ex change the Preferred Stock for Subordinated Debentures at
least 30 and not more than 60 days prior to the Exchange Date; provided,
however, that no failure to give such notice nor any deficiency therein shall
affect the validity of the procedure for the exchange of any shares of Preferred
Stock to be exchanged except as to the Holder or Holders to whom the Corporation
has failed to give said notice or to whom such notice was defective. Each
Exchange Notice must state (i) the Exchange Date, (ii) the place or places where
certificates for shares of Preferred Stock are to be surrendered for exchange
into Subordinated Debentures, (iii) that dividends on the shares of Preferred
Stock to be exchanged will cease to accrue on the Exchange Date whether or not
certificates for shares of Preferred Stock are surrendered for exchange on such
Exchange Date unless the Corporation shall default in the delivery of
Subordinated Debentures and (iv) that interest on the Subordinated Debentures
shall accrue from the Exchange Date whether or not certificates for shares of
Preferred Stock are surrendered for exchange on such Exchange Date.
al) On or before the Exchange Date, each Holder shall surrender the
certificate or certificates representing such shares of Preferred Stock, in the
manner and at the place designated in the Exchange Notice. The Corporation shall
cause the Subordinated Debentures to be executed on the Exchange Date and, upon
surrender in accordance with the Exchange Notice of the certificates for any
shares of Preferred Stock so exchanged, duly endorsed (or otherwise in proper
form for transfer, as determined by the Corporation), such shares shall be
exchanged by the Corporation for Subordinated Debentures. The Series A Preferred
shall be exchanged for Series A Debentures and the Series B Preferred shall be
exchanged for Series B Debentures. The Corporation shall pay interest on the
Subordinated Debentures at the rate and on the dates specified therein from the
Exchange Date.
am) If notice has been mailed as aforesaid, and if before the
Exchange Date specified in such notice (1) the Indenture shall have been duly
executed and delivered by the Corporation and the trustee thereunder and (2) all
Subordinated Debentures necessary for such exchange shall have been duly
executed by the Corporation and delivered to the trustee under the Indenture
with irrevocable instructions to authenticate the Subordinated Debentures
necessary for such exchange, then the rights of the Holders of Preferred Stock
so exchanged as stockholders of the Corporation shall cease (except the right to
receive Subordinated Debentures, an amount in cash equal to the amount of
accrued and unpaid dividends to the Exchange Date and, if the Corporation so
elects, cash in lieu of any Subordinated Debenture with a principal amount not
an integral multiple of $1,000), and the Person or Persons entitled to receive
the Subordinated Debentures issuable upon exchange shall be treated for all
purposes as the registered holder or holders of such Subordinated Debentures as
of the Exchange Date.
an) No Exchange in Certain Cases. Notwithstanding the forego
ing provisions of this paragraph (g), the Corporation shall not be entitled to
exchange the Preferred Stock for Subordinated Debentures if such exchange, or
any term or provision of the Indenture or the Subordinated Debentures, or the
performance of the Corporation's obligations under the Indenture or the
Subordinated Debentures, shall violate any applicable law or if, at the time of
such exchange, the Corporation is insolvent or if it would be rendered insolvent
by such exchange.
ao) Change of Control Put.
ap) In the event of a Change of Control Triggering Event, the
Corporation shall notify each Holder in writing of such occurrence and shall
make an offer to purchase (the "Change of Control Offer") such Holder's shares
of Preferred Stock at a purchase price in cash equal to 101% of the liquidation
preference thereof plus accrued and unpaid dividends per share (including an
amount in cash equal to a prorated dividend for the period from the Dividend
Payment Date immediately prior to the Change of Control Payment Date to the
Change of Control Payment Date (as defined herein)).
aq) Not later than 90 days following the date upon which the
Change of Control Triggering Event occurred, the Corporation shall send, by
first class mail, postage prepaid, a notice to each Holder of Preferred Stock at
such Holder's last registered address with a copy to the Registrar, which notice
shall govern the terms of the Change of Control Offer. The notice to the Holders
shall contain all instructions and materials necessary to enable such Holders to
tender Preferred Stock pursuant to the Change of Control Offer. Such notice
shall state:
ar) that a Change of Control has occurred, that the Change of Control Offer is
being made pursuant to this paragraph (h) and that all Preferred Stock validly
tendered and not withdrawn will be accepted for payment;
as) the purchase price (including the amount of accumulated and unpaid
dividends, if any) and the purchase date (which shall be no earlier than 30 days
nor later than 60 days from the date such notice if mailed, other than as may be
required by law) (the "Change of Control Payment Date"); provided, however, that
there shall be no right of any Holder to require the Corporation to purchase
such Holder's shares of Preferred Stock until the earlier of the date on which
all of the Deferred Coupon Notes have been repaid or have matured;
at) that any shares of Preferred Stock not
tendered will continue to accrue dividends;
au) that, unless the Corporation defaults in making payment therefor, any share
of Preferred Stock accepted for payment pursuant to the Change of Control Offer
shall cease to accrue dividends after the Change of Control Payment Date;
av) that Holders electing to have any shares of Preferred Stock purchased
pursuant to a Change of Control Offer will be required to surrender the
certificate or certificates representing such shares, properly endorsed for
transfer together with such customary documents as the Corporation and the
transfer agent may reasonably require, in the manner and at the place specified
in the notice prior to the close of business on the Business Day prior to the
Change of Control Payment Date;
aw) that Holders will be entitled to withdraw their election if the Corporation
receives, not later than five Business Days prior to the Change of Control
Payment Date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the number of shares of Preferred Stock the Holder
delivered for purchase and a statement that such Holder is withdrawing his
election to have such shares of Preferred Stock purchased;
ax) that Holders whose shares of Preferred Stock are purchased only in part will
be issued a new certificate representing the unpurchased shares of Preferred
Stock; and
ay) the circumstances and relevant facts
regarding such Change of Control Triggering Event.
az) Each Change of Control Offer shall remain open for at
least 20 Business Days or such longer period as may be required by law. The
Corporation shall comply with Rules 13e-4 and 14e-4 and 14e-1 under the Exchange
Act and other provisions of state and federal securities laws and regulations,
to the extent such laws and regulations are applicable to the repurchase of the
Preferred Stock in connection with a Change of Control Offer.
ba) On the Change of Control Payment Date the Corporation
shall (A) accept for payment the shares of Preferred Stock validly tendered
pursuant to the Change of Control Offer, (B) pay to the Holders of shares so
accepted the purchase price therefor in cash and (C) cancel and retire each
surrendered certificate. Unless the Corporation defaults in the payment for the
shares of Preferred Stock tendered pursuant to the Change of Control Offer,
dividends will cease to accrue with respect to the shares of Preferred Stock
tendered and all rights of Holders of such tendered shares will terminate,
except for the right to receive payment therefor, on the Change of Control
Payment Date.
bb) Notwithstanding the foregoing, prior to the mailing of the
notice of a Change of Control Offer referred to above, the Corporation shall (i)
within 60 days following a Change of Control Triggering Event, either (a) repay
in full all indebtedness for borrowed money of the Corporation, and terminate
all commitments, under the Potential Credit Facilities, in each case, to the
extent required upon a change of control pursuant to the terms thereof (or offer
to repay in full all such indebtedness and terminate all such commitments and
repay all such indebtedness owed to each lender which has accepted such offer
and terminate all such commitments of each such lender), or (b) obtain the
requisite consents under the Potential Credit Facilities to permit the
repurchase of the Preferred Stock as provided above and (ii) within 90 days
following a Change of Control Triggering Event, purchase all Senior Notes (or
permitted refinancings thereof) which it is required to purchase by reason of
such change of control pursuant to the provisions of the indenture therefor. The
Corporation shall first comply with the covenant described in the immediately
preceding sentence before it shall be required to repurchase Preferred Stock
pursuant to the provisions described above.
bc) Conversion or Exchange. The Holders of shares of Preferred Stock
shall not have any rights hereunder to convert such shares into or exchange such
shares for shares of any other class or classes or of any other series of any
class or classes of Capital Stock of the Corporation.
bd) Preemptive Rights. No shares of Preferred Stock shall have any
rights of preemption whatsoever as to any securities of the Corporation, or any
warrants, rights or options issued or granted with respect thereto, regardless
of how such securities or such warrants, rights or options may be designated,
issued or granted.
be) Reissuance of Preferred Stock. Shares of Preferred Stock that
have been issued and reacquired in any manner, including shares purchased or
redeemed or exchanged, shall (upon compliance with any applicable provisions of
the laws of Delaware) have the status of authorized and unissued shares of
Preferred Stock
undesignated as to series and may be redesignated and reissued as part of any
series of Preferred Stock, provided that any issuance of such shares as
Preferred Stock must be in compliance with the terms hereof.
bf) Business Day. If any payment, redemption, purchase or exchange
shall be required by the terms hereof to be made on a day that is not a Business
Day, such payment, redemption, purchase or exchange shall be made on the
immediately succeeding Business Day.
bg) Reports. Whether or not required by the rules and regulations of
the Commission, so long as any Preferred Stock is outstanding, the Corporation
will file with the Commission and furnish to the Holders of Preferred Stock all
quarterly and annual financial information required to be contained in a filing
with the Commission on Forms 10-Q and 10-K (or the equivalent thereof in the
event the Corporation becomes a corporation organized under the laws of England
and Wales), including a "Management's Discussion and Analysis of Results of
Operations and Financial Condition" and, with respect to the annual information
only, a report thereon by the Corporation's certified independent accountants,
in each case, as required by the rules and regulations of the Commission as in
effect on the Issue Date.
bh) Definitions. As used in this Certificate of Designation, the
following terms shall have the following meanings (with terms defined in the
singular having comparable meanings when used in the plural and vice versa),
unless the context otherwise requires:
"Accrual Period" shall have the meaning ascribed to it
in paragraph (c)(iii).
"Applicable Premium" means, with respect to any share of Preferred Stock,
the greater of (x) 1.0% of the liquidation preference thereof and (y) the
excess, if any, of (a) the present value of dividends accruing until and
including February 15, 2002 (assuming payment thereof in cash on the applicable
Dividend Payment Date) and the liquidation preference and any applicable
optional redemption premium therefor payable on such date for such share (in
each case assuming payment thereof on February 15, 2002), computed using a
discount rate equal to the Treasury Rate plus 100 basis points over (b) the sum
of the liquidation preference of such share plus accrued and unpaid dividends to
the redemption date.
"Board of Directors" shall have the meaning ascribed to it in the first
paragraph of this Resolution.
"Board Resolution" means a copy of a resolution certified pursuant to an
Officers' Certificate to have been duly adopted by the Board of Directors of the
Corporation and to be in full force and effect, and delivered to the Holders.
"Business Day" means any day except a Saturday, a Sunday, or any day on
which banking institutions in New York, New York are required or authorized by
law or other governmental action to be closed.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of the Corporation.
"Certificate of Incorporation" shall have the meaning ascribed to it in
the first paragraph of this Resolution.
"Change of Control" means (i) the sale, lease or transfer of all or
substantially all of the assets of the Corporation to any "person" or "group"
(within the meaning of Sections 13(d)(3) and 14(d)(2) of the Exchange Act or any
successor provision to either of the foregoing, including any group acting for
the purpose of acquiring, holding or disposing of securities within the meaning
of Rule 13d-5(b)(1) under the Exchange Act) (other than any Permitted Holder),
(ii) the approval by the requisite stockholders of the Corporation of a plan of
liquidation or dissolution of the Corporation, (iii) any "person" or "group"
(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act or any
successor provision to either of the foregoing, including any group acting for
the purpose of acquiring, holding or disposing of securities within the meaning
of Rule 13d-5(b)(1) under the Exchange Act), other than any Permitted Holder,
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act)
of more than 50% of the total voting power of all classes of the voting stock of
the Corporation and/or warrants or options to acquire such voting stock,
calculated on a fully diluted basis, unless, as a result of such transaction,
the ultimate direct or indirect ownership of the Corporation is substantially
the same immediately after such transaction as it was immediately prior to such
transaction, or (iv) during any period of two consecutive years, individuals who
at the beginning of such period constituted the Corporation's Board of Directors
(together with any new directors whose election or appointment by such board or
whose nomination for election by the shareholders of the Corporation was
approved by a vote of a majority of the directors then still in office who were
either directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute a
majority of the Corporation's Board of Directors then in office.
"Change of Control Call Event" means the entering by the Corpora tion into
a binding agreement providing for a merger, consolidation or business
combination of the Corporation with another corporation, association or other
entity, which agreement provides that upon consummation thereof that the holders
of the Common Stock will own less than 80% of the voting and economic power of
the entity, if any, in which holders of the Common Stock will hold equity
interests immediately following consummation of any such transaction.
"Change of Control Call Price" shall have the meaning ascribed to it in
paragraph (e)(ii)(B).
"Change of Control Offer" shall have the meaning
ascribed to it in paragraph (h)(i).
"Change of Control Payment Date" shall have the meaning ascribed to it in
paragraph (h)(ii)(B).
"Change of Control Triggering Event" means the occurrence of both a Change
of Control and a Ratings Decline.
"Commission" means the Securities and Exchange
Commission.
"Common Stock" means any and all shares, interests or other participations
in, and other equivalents (however designated and whether voting or non-voting)
of, the Corporation's common stock, whether outstanding on the Issue Date or
issued after the Issue Date, and includes, without limitation, all series and
classes of such common stock.
"Corporation" shall have the meaning ascribed to it in the first para
graph of this Resolution.
"Deferred Coupon Notes" means (i) the Corporation's 10_%
Senior Deferred Coupon Notes Due 2003, (ii) the Corporation's 12 3/4% Senior
Deferred Coupon Notes Due 2005 and (iii) the Corporation's 11 1/2% Senior
Deferred Coupon Notes Due 2006.
"Disqualified Capital Stock" means any Capital Stock which, by its terms
(or by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part, on or prior to February
15, 2009.
"Dividend Payment Date" shall have the meaning ascribed
to it in paragraph (c)(i).
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"Exchange Date" means the date of issuance of the Subordinated Debentures
in accordance with paragraph (g) hereof.
"Exchange Notice" shall have the meaning ascribed to it
in paragraph (g)(ii) hereof.
"Exchange Offer Registration Statement" shall have the meaning ascribed to
it in the Registration Rights Agreement.
"5% Preferred Stock" means the 5% Non-voting Convertible Pre ferred Stock,
Series A, of the Corporation.
"GAAP" means generally accepted accounting principles as in effect in the
United States from time to time.
"Holder" means a holder of shares of Preferred Stock as reflected in the
stock books of the Corporation.
"Indenture" means the indenture governing the Subordinated Deben tures to
be entered into between the Corporation and The Chase Manhattan Bank, as
trustee, on the Exchange Date, substantially in the form on file with the
secretary of the Corporation, which form is available to each Holder without
charge upon request.
"Investment Grade" means BBB- or higher by S&P or Baa3 or higher by
Moody's. In the event that the Corporation shall be permitted to select any
other Rating Agency, the equivalent of such ratings of S&P and Moody's used by
such other Rating Agency shall be used.
7
"Issue Date" means February 12, 1997, the date of original issuance of the
Preferred Stock.
"Junior Preferred Stock" means the 1,000,000 shares of Series A Junior
Participating Preferred Stock designated and reserved for issuance in the
Corporation's Certificate of
Incorporation.
"Junior Securities" shall have the meaning ascribed to
it in paragraph (b) hereof.
"Mandatory Redemption Price" shall have the meaning ascribed to it in
paragraph (e)(ii) hereof.
"Moody's" means Moody's Investors Service, Inc. and its
successors.
"Officers' Certificate" means a certificate signed by two officers or by
an officer and either an Assistant Treasurer or an Assistant Secretary of the
Corporation which certificate shall include a statement that, in the opinion of
such signers all conditions precedent to be performed by the Corporation prior
to the taking of any proposed action have been taken. In addition, such
certificate shall include (i) a statement that the signatories have read the
relevant covenant or condition, (ii) a brief statement of the nature and scope
of such examination or investigation upon which the statements are based, (iii)
a statement that, in the opinion of such signatories, they have made such
examination or investigation as is reasonably necessary to express an informed
opinion and (iv) a statement as to whether or not, in the opinion of the
signatories, such relevant conditions or covenants have been complied with.
"Opinion of Counsel" means an opinion of counsel that, in such counsel's
opinion, all conditions precedent to be performed by the Corporation prior to
the taking of any proposed action have been taken. Such opinion shall also
include the statements called for in the second sentence under the definition of
"Officers' Certificate."
"Optional Redemption Price" shall have the meaning ascribed to it in
paragraph (e)(i)(A) hereof.
8
"Parity Securities" shall have the meaning ascribed to
it in paragraph (b) hereof.
"Permitted Designee" means (i) a spouse or a child of a Permitted Holder,
(ii) trusts for the benefit of a Permitted Holder or a spouse or child of a
Permitted Holder, (iii) in the event of the death or incompetence of a Permitted
Holder, his estate, heirs, executor, administrator, committee or other personal
representative or (iv) any Person so long as a Permitted Holder owns at least
50% of the voting power of all classes of the voting stock of such Person.
"Permitted Holders" means George S. Blumenthal, J.
Barclay Knapp and their Permitted Designees.
"Person" means an individual, partnership, corporation, unincorpo rated
organization, trust or joint venture, or a governmental agency or political
subdivision thereof.
"Potential Credit Facilities" has the meaning ascribed to such term in
Corporation's Offering Memorandum dated February 7, 1997 relating to the
offering of the Senior Notes and the Preferred Stock.
"Preferred Stock" shall have the meaning ascribed to it
in paragraph (a) hereof.
"Rating Agencies" means (i) S&P, (ii) Moody's and (iii) if S&P or Moody's
or both shall not make a rating of the Securities publicly available, a
nationally recognized securities rating agency or agencies, as the case may be,
selected by the Corporation, which shall be substituted for S&P or Moody's or
both, as the case may be.
"Rating Category" means (i) with respect to S&P, any of the follow ing
categories: BB, B, CCC, CC, C and D (or equivalent successor categories), (ii)
with respect to Moody's, and of the following categories: Ba, B, Caa, Ca, C and
D (or equivalent successor categories) and (iii) the equivalent of any such
category of S&P or Moody's used by another Rating Agency. In determining whether
the rating of the Securities has decreased by one or more gradations, gradations
within Rating Categories (+ and - for S&P; 1, 2 and 3 for Moody's; or the
equivalent gradations for another Rating Agency) shall be taken into account
(e.g., with respect to S&P, a decline in a rating from BB to BB-, as well as
from BB- to B+, will constitute a decrease of one gradation).
"Rating Date" means that date which is 90 days prior to the earlier of (x)
a Change of Control and (y) public notice of the occurrence of a Change of
Control or of the intention by the Corporation or any Permitted Holder to effect
a Change of Control.
"Ratings Decline" means the occurrence of any of the following events on,
or within six months after, the date of public notice of the occurrence of a
Change of Control or of the intention of the Corporation or any person to effect
a Change of Control (which period shall be extended so long as the rating of any
of the Corporation's debt securities is under publicly announced consideration
for possible downgrade by any of the Rating Agencies): (a) in the event that any
of the Corporation's debt securities are rated by both of the Rating Agencies on
the Rating Date as Investment Grade, the rating of such debt securities by
either of the Rating Agencies shall be below Investment Grade, (b) in the event
that any of the Corporation's debt securities are rated by either, but not both,
of the Rating Agencies on the Rating Date as Investment Grade, the rating of
such debt securities by both of the Rating Agencies shall be below Investment
Grade, or (c) in the event any of the Corporation's debt securities are rated
below Investment Grade by both of the Rating Agencies on the Rating Date, the
rating of such debt securities by either Rating Agency shall be decreased by one
or more gradations (including gradations within Rating Categories as well as
between Rating Categories).
"Redemption Date," with respect to any shares of Preferred Stock, means
the date on which such shares of Preferred Stock are redeemed by the
Corporation.
"Redemption Notice" shall have the meaning ascribed to it in para graph
(e)(iii) hereof.
"Registered Exchange Offer" shall have the meaning ascribed to such term
in the Registration Rights Agreement.
"Registrar" means Continental Stock Transfer & Trust
Company, as transfer agent and Registrar for the Preferred
Stock.
"Registration Defaults" shall have the meaning ascribed
to it in paragraph (c)(iii).
"Registration Rights Agreement" means the Registration Rights Agreement
relating to the Preferred Stock and the Subordinated Debentures dated as of
February 12, 1997 between the Corporation and Donaldson, Lufkin & Jenrette
Securities Corporation, Chase Securities Inc. and Merrill Lynch, Pierce, Fenner
& Smith Incorporated, a copy of which is available to each Holder without charge
upon request from the secretary of the Corporation.
"S&P" means Standard & Poor's Ratings Group and its
successors.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Senior Notes" means the 10% Senior Notes Due 2007 of the Corpo ration.
"Senior Securities" shall have the meaning ascribed to
it in paragraph (b) hereof.
"Series A Debentures" means the 13% Subordinated Exchange Debentures Due
2009 issuable under the Indenture.
"Series B Debentures" means the 13% Series B Subordinated Ex change
Debentures Due 2009 issuable under the Indenture.
"Series A Preferred" shall have the meaning ascribed to it in para graph
(a) hereof.
"Series B Preferred" shall have the meaning ascribed to it in para graph
(a) hereof.
9
"Shelf Registration Statement" shall have the meaning ascribed to such
term in the Registration Rights Agreement.
"Special Dividends" shall have the meaning ascribed to
it in para graph (c)(iii).
"Subordinated Debentures" means the Series A Debentures
and the Series B Debentures.
"Transfer Agent" means Continental Stock Transfer &
Trust Com pany, as Transfer Agent for the Preferred Stock.
"Transfer Restricted Securities" shall have the meaning ascribed to it in
the Registration Rights Agreement.
"Treasury Rate" means the yield to maturity at the time of computa tion of
United States Treasury securities with a constant maturity (as compiled and
published in the most recent Federal Reserve Statistical Release H.15 (519)
which has become publicly available at least two business days prior to the date
fixed for redemption of the Preferred Stock (or, if such Statistical Release is
no longer published, any publicly available source of similar data)) most nearly
equal to the then remaining period to the date scheduled for the mandatory
redemption of the Preferred Stock; provided, however, that if such period is not
equal to the constant maturity of a United States Treasury security for which a
weekly average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the weekly
average yields of United States Treasury securities for which such yields are
given, except that if the period to the date scheduled for the mandatory
redemption of the Preferred Stock is less than one year, the weekly average
yield on actually traded United States Treasury securities adjusted to a
constant maturity of one year shall be used.
"Voting Rights Triggering Event" shall have the meaning ascribed to it in
paragraph (f)(i) hereof.
0228255.01-New YorkS5A
10
11
Exhibit B
9.90% NON-VOTING MANDATORILY REDEEMABLE
PREFERRED STOCK, SERIES A
(1) Designation; Number of Shares. The designation of the series of
Preferred Stock, par value $.01 per share, of the Company created hereby shall
be "9.90% Non-voting Mandatorily Redeemable Preferred Stock, Series A"
(including, in the case of any reclassification, recapitalization, or other
change to such Preferred Stock or, in the case of a consolidation or merger of
the Company with or into another Person affecting such Preferred Stock, such
capital stock to which a holder of such Preferred Stock shall be entitled upon
the occurrence of such event, the "Mandatorily Redeemable Preferred Stock"). The
authorized number of shares of Mandatorily Redeemable Preferred Stock shall be
125,280, which number may from time to time be increased or decreased (but not
below the number then outstanding). Each share of Mandatorily Redeemable
Preferred Stock shall have a stated value of $1,000 (the "Stated Value").
Any shares of Mandatorily Redeemable Preferred Stock redeemed or
otherwise acquired by the Company shall be retired and shall resume the status
of authorized and unissued shares of Preferred Stock, without designation as to
series, until such shares are once more designated as part of a particular
series of Preferred Stock by the Board of Directors.
(2) Certain Definitions. Unless the context otherwise requires, the
terms defined in this paragraph (2) shall have, for all purposes of this
Certificate of Designations, the meanings herein specified:
"Applicable Price" shall mean the aggregate of (A) in the event of a
Reorganization in which the holders of Common Stock receive cash, the amount of
such cash receivable by the holder of one share of Common Stock (as such share
is in effect immediately prior to the consummation of such Reorganization); and
(B) in the event of a Reorganization in which the holders of Common Stock
receive securities or other property which are traded on an established market
(within the meaning of Treasury Regulation 1.1273-2(f)(1) of the Internal
Revenue Code of 1986, as in effect on September 30, 1990), the average (or if
there be more than one security or item of property the sum of the averages) of
the daily Trading Prices of such securities and/or property receivable by the
holder of one share of Common Stock (as such share is in effect immediately
prior to such consummation) for the period of ten consecutive Trading Days
ending on the Trading Day immediately preceding date of occurrence of the
Reorganization, appropriately adjusted to take into account any stock dividend
on such security or property, or any subdivision, split, combination,
reclassification of such security or property that occurs or the "ex" date for
which occurs on or prior to such date.
B-1
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"Average Market Price" on any Determination Date, shall mean the
average of the daily Closing Prices for the period of 10 consecutive Trading
Days, ending on the Trading Day immediately preceding such Determination Date,
appropriately adjusted to take into account any stock dividend on the Common
Stock or any subdivision, split, combination or reclassification of the Common
Stock that occurs, or the date on which "ex-dividend" trading commences, during
the period following the first Trading Day in such ten-Trading Day period to and
including the Determination Date.
"Board" shall mean the Board of Directors of the Company, and,
unless the context indicates otherwise, shall also mean, to the extent permitted
by law, any committee thereof authorized, with respect to any particular matter,
to exercise the power of the Board of Directors of the Company with respect to
such matter.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in New York, New York and London, England are
authorized to close or not obligated by law or executive order to open.
"Closing Price" shall mean, on any day:
(i) the average between the high and low reported sale price of a
share of Common Stock on and as reported by the Nasdaq Stock Market's National
Market on such day;
(ii) if the primary trading market for the Common Stock on such day
is not the Nasdaq Stock Market's National Market, then the closing sale price
regular way on such day, or, in case no such sale takes place on such day, the
average of the reported closing bid and asked prices regular way on such day, in
either case as reported by the Nasdaq System, the National Quotations Bureau,
Inc. or a compara ble service;
(iii) if the Closing Price on such day is not available pursuant to
one of the methods specified above, then the average of the bid and asked prices
for the Common Stock on such day as furnished by any New York Stock Exchange
member firm selected from time to time by the Board for that purpose; or
(iv) if the Closing Price on such day is not available pursuant to
the method specified in (iii) above, the determination of Closing Price shall be
deter mined in good faith by the Board exercising its reasonable discretion.
B-2
13
"Common Stock" shall mean the shares of common stock, par value
$0.01 per share, of the Company, which term shall include, where appropriate, in
the case of any reclassification, recapitalization or other change in the Common
Stock, or in the case of a consolidation or merger of the Company with or into
another Person affecting the Common Stock, such capital stock to which a holder
of Com mon Stock shall be entitled upon the occurrence of such event.
"Common Stock Dividend Amount" shall have the meaning set forth in
paragraph (3) (c).
"Convertible Preferred Stock" shall mean the series of Preferred
Stock of the Company having the terms set forth in the draft of Convertible
Preferred Stock terms attached hereto, as completed pursuant to paragraph (5)
hereof.
"Convertible Preferred Stock Issue Price" shall have the meaning set
forth in paragraph (3)(d) and shall be computed pursuant to paragraph (5).
"Convertible Securities" shall mean evidences of indebtedness or
shares of stock which are, at the option of the holder hereof, convertible into
or exchangeable for shares of Common Stock.
"Current Market Price" on the Determination Date for any issuance of
Options or Convertible Securities or any distribution in respect of which the
Current Market Price is being calculated, shall mean the average of the daily
Closing Prices of the Common Stock for the period of 10 consecutive Trading Days
ending on the last full Trading Day before such Determination Date.
"Determination Date" shall mean: (i) in the case of a dividend
payment, the record date for such dividend payment, (ii) in the case of a
redemption payment, the date of the notice of the Redemption Date and (iii) in
the case of a Reorganization, the date the Reorganization occurs.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, or any successor statute, and the rules and
regulations promulgated thereunder.
"Fixed Price", on any Determination Date with respect to the Convert
ible Preferred Stock, shall have the meaning assigned to such term in the
Certificate
B-3
14
of Designations relating to, and setting forth the terms of, the Convertible
Preferred Stock.
"Issue Date" shall mean September 22, 1998.
"JPPF" shall mean the Series A Junior Participating Preferred Stock
of the Company issuable upon exercise of the Rights pursuant to the Rights Agree
ment.
"Junior Stock" shall mean:
(i) each class or series of common stock of the Company, including,
without limitation, the Common Stock;
(ii) the JPPF issuable upon exercise of the Rights;
(iii) any other class or series of capital stock of the Company
hereafter created, other than (a) any class or series of Parity Stock (except to
the extent provided under clause (iv) hereof) and (b) any class or series of
Senior Stock, and
(iv) any class or series of Senior Stock or Parity Stock to the
extent that it ranks junior to the Mandatorily Redeemable Preferred Stock as to
dividend rights, rights of redemption or rights on liquidation, as the case may
be. For pur poses of clause (iii) above, a class or series of Senior Stock or
Parity Stock shall rank junior to the Mandatorily Redeemable Preferred Stock as
to dividend rights, rights of redemption or rights on liquidation if the holders
of shares of Mandatorily Redeem able Preferred Stock shall be entitled to
dividend payments, payments on redemption or payments of amounts distributable
upon dissolution, liquidation or winding up of the Company, as the case may be,
in preference or priority to the holders of shares of such class or series of
Senior Stock or Parity Stock.
"Liquidating Payment" shall mean an amount equal to the Liquidation
Preference of a share of Mandatorily Redeemable Preferred Stock or, if less, the
amount payable in respect of one share of Mandatorily Redeemable Preferred Stock
pursuant to paragraph (8)(a) upon the voluntary or involuntary liquidation,
dissolu tion or winding up of the affairs of the Company.
B-4
15
"Liquidating Payment Date" shall mean the date on which the Company
makes the aggregate Liquidating Payment to all holders of outstanding shares of
Mandatorily Redeemable Preferred Stock.
"Liquidation Preference" measured per share of the Mandatorily
Redeemable Preferred Stock, shall mean an amount equal to (a) the Stated Value
per share of Mandatorily Redeemable Preferred Stock, plus (b) for purposes of
determin ing the amount payable pursuant to paragraph (8) only, an amount equal
to all dividends accrued but unpaid on such share, whether or not such unpaid
dividends have been declared or there are funds of the Company legally available
for the payment of dividends, to the Liquidating Payment Date.
"Mandatorily Redeemable Preferred Stock" shall have the meaning set
forth in paragraph (1).
"Mandatory Redemption Price" shall have the meaning set forth in
paragraph (4)(b).
"Option" shall mean any right, option or warrant entitling the
holder thereof to subscribe for, purchase, or otherwise acquire Common Stock in
the Company (other than the Rights).
"Parity Stock" shall mean the Mandatorily Redeemable Preferred Stock
and any class or series of capital stock, whether now existing or hereafter
created, of the Company to the extent ranking on a parity basis with the
Mandatorily Redeemable Preferred Stock as to dividend rights, rights of
redemption or rights on liquidation. Capital stock of any class or series,
whether now or existing or hereafter created, shall rank on a parity as to
dividend, rights of redemption or rights on liquidation with the Mandatorily
Redeemable Preferred Stock, whether or not the dividend rates, dividend payment
dates, redemption or liquidation prices per share or sinking fund or mandatory
redemption provision, if any, are different from those of the Mandatorily
Redeemable Preferred Stock, if the holders of shares of such class or series
shall be entitled to dividend payments, payments on redemption of payments of
amounts distributable upon dissolution, liquidation or winding up of the Com
pany, as the case may be, in proportion to their respective accumulated and
accrued and unpaid dividends, redemption prices or liquidation prices,
respectively, without preference or priority, one over the other, as between the
holders of shares of such class or series and the holders of Mandatorily
Redeemable Preferred Stock. No class or series of capital stock that ranks
junior to the Mandatorily Redeemable Preferred Stock as to rights on liquidation
shall rank or be deemed to rank on a parity basis
B-5
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with the Mandatorily Redeemable Preferred Stock as to dividend rights or rights
of redemption.
"Payment Record Date" shall have the meaning set forth in paragraph
(13).
"Person" shall mean any individual corporation, partnership, joint
venture, association, joint stock company, limited liability company, trust,
unincor porated organization, government or agency or political subdivision
thereof, or other entity, whether acting in an individual, fiduciary or other
capacity.
"Preferred Stock Dividend Amount" shall have the meaning set forth
in paragraph (3)(d).
"Redemption Agent" shall have the meaning set forth under paragraph
(4)(h).
"Redemption Date" as to any share of Mandatorily Redeemable
Preferred Stock, shall mean the date on which such share is redeemed by the Com
pany pursuant to paragraph (4).
"Redemption Notice" shall have the meaning set forth in paragraph
(4)(e).
"Redemption Price" shall have the meaning set forth in paragraph
(4)(a).
"Reorganization" shall mean any of the following events:
(i) any consolidation or merger of the Company with another entity
(other than a merger or consolidation in which the Company is the surviving or
continuing corporation and in which the Common Stock outstanding immediately
prior to the merger or consolidation remains unchanged),
(ii) the sale or other transfer of all or substantially all of its
assets to another entity.
(iii) any reorganization or reclassification of the Common Stock or
other equity securities of the Company, and
B-6
17
(iv) any statutory exchange of any shares of capital stock of the
Company with another corporation (other than a merger or consolidation in which
the Company is the surviving or continuing corporation and in which the Common
Stock outstanding immediately prior to the merger or consolidation remains un
changed).
"Reorganization Unit" means the kind or amount of securities, cash
or other property receivable upon consummation of a Reorganization in
substitution of or in exchange for a share of Common Stock as such share is in
effect immediately prior to such consummation (provided that if the kind or
amount of securities, cash or other property receivable upon consummation of
such Reorganization is not the same with respect to each such share, then the
kind and amount of securities, cash or other property which shall be deemed
receivable upon consummation of such Reorganization with respect to each such
share for purposes hereof shall be the kind and amount so receivable per share
by a plurality of such shares).
"Rights" means the rights issuable pursuant to the Rights Agreement.
"Rights Agreement" means the rights agreement, dated as of October
13, 1993, between the Company and Continental Transfer and Trust Company, as
rights agent.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time, or any successor statute, and the rules and regulations
promul gated thereunder.
"Senior Stock" shall mean any class or series of capital stock of
the Company hereafter created to the extent ranking prior to the Mandatorily
Redeem able Preferred Stock as to dividend rights, rights of redemption or
rights on liquida tion. Capital stock of any class or series shall rank prior to
the Mandatorily Redeem able Preferred Stock as to dividend rights, rights of
redemption or rights on liquida tion if the holders of shares of such class or
series shall be entitled to dividend payments, payments on redemption or
payments of amounts distributable upon dissolution, liquidation or winding up of
the Company, as the case may be, in preference or priority to the holders of
shares of Mandatorily Redeemable Preferred Stock. No class or series of capital
stock than ranks on a parity basis with or junior to the Mandatorily Redeemable
Preferred Stock as to rights on liquidation shall rank or be deemed to rank
prior to the Mandatorily Redeemable Preferred Stock as to dividend rights or
rights of redemption, notwithstanding that the dividend rate, dividend payment
dates, sinking fund provisions, if any, or mandatory redemption
B-7
18
provisions thereof are different from those of the Mandatorily Redeemable
Preferred Stock.
"Stated Value" shall have the meaning set forth in paragraph (1).
"Trading Day" shall mean a day on which the Nasdaq Stock Market's
National Market or, if different, the principal exchange on which the Common
Stock is quoted or traded is each open for the transaction of business.
"Trading Price" of a security or property for any day means the
closing sale price regular way on such day, or, in case no such sale takes place
on such day, the average of the reported closing bid and asked prices of such
security or property on such day on the applicable established market on which
such security or property is traded.
(3) DIVIDENDS.
(a) Payment. The holders of outstanding shares of Mandatorily
Redeemable Preferred Stock shall be entitled to receive, when, as and if
declared by the Board out of funds legally available therefor (without prejudice
to paragraph (3)(b)), cumulative dividends, in preference to dividends on any
Junior Stock, at the rate per annum of 9.90% of the Stated Value per share,
rounded to the nearest cent. Such dividends shall accrue from the Issue Date and
shall be payable on the date the Mandatorily Redeemable Preferred Stock is
redeemed pursuant to paragraph (4).
Dividends on the outstanding shares of Mandatorily Redeemable
Preferred Stock will accrue on a daily basis (without interest or compounding)
whether or not there are funds legally available for the payment of such
dividends and whether or not such dividends are declared. Dividends will cease
to accrue in respect of shares of Mandatorily Redeemable Preferred Stock on the
date of their redemption. No interest, or sum of money in lieu of interest,
shall be payable in respect of any accrued dividend payment.
(b) Declaration and Manner of Payment of Dividends. Any divi dends
may be paid, in the sole discretion of the Board: (i) in cash out of funds
legally available therefor; (ii) through the delivery of shares of Common Stock;
(iii) through the delivery of shares of Convertible Preferred Stock, or (iv)
through any combination of the foregoing forms of consideration elected by the
Board in its sole discretion. If any dividend declared by the Board is to be
paid, in whole or in part, through the delivery of shares of Common Stock or
Convertible Preferred Stock,
B-8
19
each holder of Mandatorily Redeemable Preferred Stock shall receive the same
proportion of cash and/or shares of Common Stock or Convertible Preferred Stock
(except for cash paid in lieu of fractional shares) delivered in payment of such
dividend to other holders of shares of Mandatorily Redeemable Preferred Stock.
(c) Payment of Dividends by Delivery of Common Stock. If the Company
elects to pay any dividend payment, in whole or in part, by delivery of shares
of Common Stock, the amount of such dividend payment to be paid per share of
Mandatorily Redeemable Preferred Stock in shares of Common Stock (the "Common
Stock Dividend Amount") shall be paid through the delivery to the holders of
record for such shares of Mandatorily Redeemable Preferred Stock on the record
date for such dividend payment (which shall be not more than 10 days prior to
the payment date) of a number of shares of Common Stock determined by dividing
the Common Stock Dividend Amount by the Average Market Price. No fractional
shares of Common Stock shall be delivered to a holder of shares of Mandatorily
Redeemable Preferred Stock, but the Company shall instead pay a cash adjustment
determined as provided in paragraph (9).
(d) Payment of Dividends by Delivery of Convertible Preferred Stock.
Subject to compliance with paragraph (5), if the Company elects to pay any
dividend payment, in whole or in part, by delivery of shares of Convertible
Preferred Stock, the amount of such dividend payment to be paid per share of
Mandatorily Redeemable Preferred Stock in shares of Convertible Preferred Stock
(the "Preferred Stock Dividend Amount") shall be paid through the delivery to
the holders of record for such shares of Mandatorily Redeemable Preferred Stock
on the record date for such dividend payment (which shall be not more than 10
days prior to the payment date) of a number of shares of Convertible Preferred
Stock determined by dividing the Preferred Stock Dividend Amount by the issue
price of the Convertible Preferred Stock as determined in accordance with
paragraph (5) (the "Convertible Preferred Stock Issue Price"). No fractional
shares of Convertible Preferred Stock shall be delivered to a holder of shares
of Mandatorily Redeemable Preferred Stock, but the Company shall instead pay a
cash adjustment determined as provided in paragraph (9).
(e) Prohibitions on Cash Dividends. Notwithstanding anything
contained in this Certificate to the contrary, but without effect on the accrual
thereof, no cash dividends on shares of Mandatorily Redeemable Preferred Stock
shall be declared by the Board or paid or set apart for payment by the Company
at such time as the terms and provisions of any agreement of the Company,
including, without limitation, any agreement, contract, indenture, bond, note,
debenture, guarantee or
B-9
20
other instrument relating to or evidencing its indebtedness, prohibits such
declara tion, payment or setting apart for payment or provides that such
declaration, payment or setting apart for payment would constitute a breach
thereof or a default thereun der; provided, however, that nothing contained in
this paragraph (e) shall alter, limit or restrict the Company's obligation to
declare and pay accrued dividends, to the extent permitted by applicable law,
through the delivery of shares of Common Stock or shares of Convertible
Preferred Stock pursuant to paragraph (3)(b), whether permitted by any such
agreement or not.
(f) Pro Rata. All dividends paid with respect to the shares of
Mandatorily Redeemable Preferred Stock shall be paid pro rata (as nearby as may
be practicable) to the shareholders entitled thereto.
(g) Priority. Payment of dividends to the holders of shares of
Mandatorily Redeemable Preferred Stock shall be subject to the prior preferences
and other rights of any Senior Stock and to the provisions of paragraph (7).
(4) REDEMPTION.
(a) Optional Redemption. At any time during the period beginning on
the Issue Date until the Redemption Date, the Company shall have the right to
redeem the outstanding shares of Mandatorily Redeemable Preferred Stock at a
price equal to $1,000 per share, together with an amount equal to all dividends
accrued but unpaid thereon to the date fixed for redemption (the "Redemption
Price").
(b) Mandatory Redemption. All outstanding shares of Mandatorily
Redeemable Preferred Stock shall be mandatorily redeemed by the Company out of
funds legally available therefor on the date that is the tenth anniversary of
Issue Date at a redemption price equal to $1,000 per share, plus an amount equal
to all accrued and unpaid dividends per share (the "Mandatory Redemption
Price").
(c) Early Mandatory Redemption. If the Company has not exercised its
right to optionally redeem the Mandatorily Redeemable Preferred Stock by
December 22, 1999, all outstanding shares of Mandatorily Redeemable Preferred
Stock shall be mandatorily redeemed at the Mandatory Redemption Price.
(d) Company's Right to Elect Manner of Payment of Redemption Price
or Mandatory Redemption Price. The Company may effect the redemption of shares
of Mandatorily Redeemable Preferred Stock at the Redemption Price or the
Mandatory Redemption Price, in the sole discretion of the Board: (i) in cash out
of
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funds legally available therefor, (ii) in exchange for and through the delivery
of shares of Common Stock, (iii) subject to compliance with paragraph (5), in
exchange for and through delivery of shares of Convertible Preferred Stock or
(iv) through any combination of the foregoing forms of consideration elected by
the Board in its sole discretion.
(e) Notice of Redemption. In the event of an offer by the Company to
redeem any shares of Mandatorily Redeemable Preferred Stock pursuant to
paragraph (4)(a) or a redemption of the Mandatorily Redeemable Preferred Stock
pursuant to paragraph (4)(b) or (4)(c), the Company shall provide notice of such
offer to redeem or such redemption to holders of record of Mandatorily
Redeemable Preferred Stock to be redeemed not less than 30 days (not less than
10 days if the Redemption Price or Mandatory Redemption Price is payable in cash
or Common Stock) nor more than 60 days prior to the Redemption Date. Such notice
(a "Re demption Notice") shall, subject to paragraph (4)(h)(z), be provided in
accordance with paragraph (14); provided, however, that neither failure to give
such notice nor any defect therein shall affect the validity of the proceedings
for the redemption of any shares of Mandatorily Redeemable Preferred Stock to be
redeemed.
In addition to any information required by law, the Redemption
Notice shall state, as appropriate, the following (and may contain such other
informa tion as the Company deems advisable):
(A) whether the redemption is pursuant to paragraph (4)(a), (4)(b)
or (4)(c);
(B) the Redemption Date;
(C) the number of shares of Mandatorily Redeemable Preferred Stock
to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of shares to be redeemed
from such holder;
(D) the Redemption Price or Mandatory Redemption Price and the
form or forms of consideration that the Company has elected to
pay and/or deliver upon such redemption and, if more than one
form of consideration has been elected by the Company, the
designated portions of the Redemption Price or Mandatory
Redemption Price to be paid in each form of consideration so
elected;
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(E) if the Company has elected to exchange and deliver shares of
Common Stock in payment of the Redemption Price (or a
designated portion thereof), the Company's computation of the
number of shares of Common Stock exchangeable and deliver able
as provided in paragraph (4)(f);
(F) if the Company has elected to exchange and deliver shares of
Convertible Preferred Stock in payment of the Redemption Price
(or a designated portion thereof), a statement of the
Convertible Preferred Stock Issue Price computed pursuant to
paragraph (5);
(G) the place or places in the United States or England and Wales
where certificates for Mandatorily Redeemable Preferred Stock
to be redeemed are to be surrendered for redemption; and
(H) that dividends on the shares of Mandatorily Redeemable
Preferred Stock to be redeemed shall cease to accrue on the
Redemption Date (unless the Company defaults in making payment
of the Redemption Price).
(f) Redemption by Delivery of Common Stock. If the Company elects to
pay, in whole or in part, the Redemption Price in respect of shares of
Mandatorily Redeemable Preferred Stock in exchange for and through the delivery
of shares of Common Stock, then the Company shall deliver to each holder of
shares of Mandatorily Redeemable Preferred Stock to be redeemed on the
Redemption Date a number of shares of Common Stock equal to the aggregate
Redemption Price (or designated portion thereof) of such shares of Mandatorily
Redeemable Preferred Stock divided by the Average Market Price. No fractional
shares of Common Stock shall be delivered to a holder of shares of Mandatorily
Redeemable Preferred Stock in payment of the Redemption Price, but the Company
shall instead pay a cash adjustment determined as provided in paragraph (9).
(g) Redemption by Delivery of Convertible Preferred Stock. If the
Company elects to pay, in whole or in part, the Redemption Price in respect of
shares of Mandatorily Redeemable Preferred Stock in exchange for and through the
delivery of shares of Convertible Preferred Stock, then the Company shall
deliver to each holder of shares of Mandatorily Redeemable Preferred Stock to be
redeemed on the Redemption Date a number of shares of Convertible Preferred
Stock equal to the
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aggregate Redemption Price (or designated portion thereof) of such shares of
Mandatorily Redeemable Preferred Stock divided by the Convertible Preferred
Stock Issue Price. No fractional shares of Convertible Preferred Stock shall be
delivered to a holder of shares of Mandatorily Redeemable Preferred Stock in
payment of the Redemption Price, but the Company shall instead pay a cash
adjustment as deter mined in paragraph (9).
(h) Deposit of Funds and/or Shares. If on or before the Redemption
Date: (x) the Company shall have deposited with any bank or trust company
organized under the laws of the United States of America or any state thereof
having capital, undivided profits and surplus aggregating at least $250 million
(the "Re demption Agent"), cash (including cash for any adjustment in lieu of
delivering fractional shares) and/or shares of Common Stock or Convertible
Preferred Stock, as applicable, sufficient to pay in full the aggregate
Redemption Price (calculated through the Redemption Date) for such shares of
Mandatorily Redeemable Preferred Stock on such Redemption Date, (y) such cash
and/or shares of Common Stock or Convertible Preferred Stock, as applicable, are
readily available to, but only to, the holders of Mandatorily Redeemable
Preferred Stock in satisfaction of the obligations of the Company with respect
to the payment of the Redemption Price and (z) the Company shall prior to the
Redemption Date have so notified each record holder of Mandatorily Redeemable
Preferred Stock, which notice shall be given to each holder of Mandatorily
Redeemable Preferred Stock by courier and shall identify the Redemption Agent,
its address and telephone and telecopier numbers and the contact person(s) at
the Redemption Agent responsible for administration of the deposit then,
effective as of the close of business on such Redemption Date (and
notwithstanding that any certificate therefor shall not have been surrendered
for cancellation): (i) such shares of Mandatorily Redeemable Preferred Stock
shall no longer be deemed outstanding but any shares of Common Stock or
Convertible Preferred Stock so deposited in accordance with this paragraph (h)
for which such Mandatorily Redeem able Preferred Stock was redeemed shall be
deemed to be outstanding; (ii) the holders thereof shall cease to be holders of
Mandatorily Redeemable Preferred Stock but shall be shown on the records of the
Company as holders of the Common Stock or Convertible Preferred Stock so
deposited in accordance with this paragraph (h) in redemption of such
Mandatorily Redeemable Preferred Stock; (iii) dividends with respect to the
shares so called for redemption shall cease to accrue on the Redemp tion Date
but, subject to paragraph (4)(f), such holders shall be entitled to any
dividends which shall thereafter accrue on, and shall be entitled to exercise
all other rights associated with, any shares of Common Stock or Convertible
Preferred Stock so deposited in accordance with this paragraph (h) in redemption
of such Mandatorily Redeemable Preferred Stock; and (iv) all rights whatsoever
with respect
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to the shares so called for redemption shall forthwith cease and terminate
(except the right of such holders, upon the surrender of certificates evidencing
the shares of Mandatorily Redeemable Preferred Stock so redeemed, to receive the
cash and/or Common Stock or Convertible Preferred Stock, as applicable, payable
or deliverable in payment of the Redemption Price therefor, and the applicable
cash adjustment, if any, in lieu of fractional shares, without interest). Any
cash and/or shares of Com mon Stock or Convertible Preferred Stock so deposited
or set apart which shall remain unclaimed at the end of one year after the
Redemption Date shall be returned or released to the Company, after which time
the holders of shares of Mandatorily Redeemable Preferred Stock called for
redemption on such Redemption Date that remain outstanding after such one-year
period shall look only to the Company for the payment of the Redemption Price
for such shares, without interest.
A deposit made in compliance with the immediately preceding sentence
shall, except to the extent released or returned to the Company, be deemed to
constitute full payment for the shares of Mandatorily Redeemable Preferred Stock
to be redeemed. Any interest accrued on funds so deposited shall be paid by the
Redemption Agent to the Company from time to time.
(i) Surrender of Certificates; Status. Each holder of shares of
Mandatorily Redeemable Preferred Stock to be redeemed shall not be entitled to
receive payment of the Redemption Price for such shares until such holder shall
surrender the certificates evidencing such shares duly endorsed by, or
accompanied by, an instrument of transfer (in form reasonably satisfactory to
the Company) duly executed by, the holder or such holder's duly authorized
attorney-in-fact or, if the shares issuable upon redemption are to be issued in
the same name as the name in which such share of the Mandatorily Redeemable
Preferred Stock is registered, in blank to the Redemption Agent (or to the
Company if there is no Redemption Agent) at the place designated in the
Redemption Notice for such redemption and shall thereupon be entitled to receive
the consideration for such shares specified in the Redemption Notice in an
aggregate amount equal to the Redemption Price for such shares. Holders of
shares of Mandatorily Redeemable Preferred Stock that are redeemed on the
Redemption Date shall not be entitled to receive dividends declared and paid on
any shares of Common Stock or Convertible Preferred Stock exchange able and
deliverable in payment of the Redemption Price (or designated portion thereof)
for such shares of Mandatorily Redeemable Preferred Stock, and such shares of
Common Stock or Convertible Preferred Stock shall not be entitled to vote, until
such shares of Common Stock or Convertible Preferred Stock are delivered upon
the surrender of the certificates representing such shares of Mandatorily
Redeemable Preferred Stock. Upon such surrender, such holders shall be entitled
to receive such
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dividends declared and paid subsequent to such Redemption Date and prior to the
delivery.
(j) Priority. The right of the Company to redeem shares of
Mandatorily Redeemable Preferred Stock pursuant to this paragraph (4) shall be
subject to the prior preferences and other rights of any Senior Stock and to the
provisions of paragraph (7).
(5) DETERMINATION OF CONVERTIBLE PREFERRED
STOCK ISSUE PRICE.
(a) If the Company elects to deliver Convertible Preferred Stock in
payment of the Redemption Price or Mandatory Redemption Price, it must elect (by
notice to the holders of the Mandatorily Redeemable Preferred Stock), at its
discre tion, either to:
(i) deliver to the holder a letter from an independent investment
bank (the "Independent Investment Banker") to the holder to the effect that the
bank believes on the terms and conditions set out in the letter that the
Convertible Pre ferred Stock, when issued, can be distributed at not less than
the Redemption Price of the Mandatorily Redeemable Preferred Stock to be
redeemed by the delivery of such Convertible Preferred Stock (without giving
effect to commissions); such letter shall be based on (A) the marketing efforts
that the management of the Company is committed to make (with dates, schedules,
locations and team being specified), (B) the documentation which the Company has
committed to make available (such documentation to be specified) and (C) the
gross spread as reasonably determined by the holder of the Mandatorily
Redeemable Preferred Stock in accordance with normal market practice; or
(ii) deliver to the holder a "bought" sale relating to the sale of
the Convertible Preferred Stock which will entitle the holder to receive an
amount equal to not less than the Redemption Price of the Mandatorily Redeemable
Preferred Stock to be redeemed by the delivery of the Convertible Preferred
Stock.
(b) A notice pursuant to paragraph (a)(i) must be sent at least one
month prior to the proposed issue date of the Convertible Preferred Stock. A
notice pursuant to clause (a)(ii) must be sent at least one week prior to the
proposed issue date of the Convertible Preferred Stock.
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(c) If the Company elects paragraph (a)(i), it must procure (a) that
its management team will be available for a period of not less than 3 Business
Days to make presentations to potential institutional and other purchasers of
the Convertible Preferred Stock, such presentations to take place within 3 weeks
of the dates speci fied in the letter from the independent investment bank, and
(b) that the documenta tion which it committed to make available pursuant to
paragraph (a)(i)(B) is avail able.
(d) If the Company elects paragraph (a)(i), the Convertible
Preferred Stock Issue Price will be the higher of the Redemption Price of the
Mandatorily Redeemable Preferred Stock and the price at which the Convertible
Preferred Stock can be placed with institutional investors at the end of the
marketing period for such Convertible Preferred Stock (such price to be
evidenced by a "bring-down" letter from the Independent Investment Banker), and
the principal amount of Convertible Preferred Stock shall be reduced
accordingly. The holders will (in case of a distribu tion under paragraph
(a)(i)) pay for the gross spread or discount. All other related costs of the
distribution will be paid by the Company.
(e) If the Company elects clause (a)(ii), the Convertible Preferred
Stock Issue Price shall be at the discretion of the Company. If the Company
elects clause (a)(ii), the Company may also establish the Fixed Price so that it
may be the higher of US$60 per share and 30% above the Average Market Price at
the time of setting of the Fixed Price.
(6) REORGANIZATIONS.
(a) (i) Reorganizations. If there is to occur any Reorganization,
and there is determinable for the entirety of each Reorganization Unit to be
issued in connection with such Reorganization on an Applicable Price, then as a
condition precedent to such Reorganization proper provision shall be made such
that each share of Mandatorily Redeemable Preferred Stock, or each share of
mandatorily redeem able preferred stock of the Company or its successor by
merger or consolidation issuable to each holder of Mandatorily Redeemable
Preferred Stock in exchange or substitution therefor (provided, however, that
such share of mandatorily redeemable preferred stock has the same Stated Value,
subject to the proviso in paragraph (6)(a)(ii), and substantially the same
rights, benefits and privileges as a share of Mandatorily Redeemable Preferred
Stock), shall be redeemable upon and from and after the occurrence of such
Reorganization into, in lieu of Convertible Preferred Stock as provided herein
(and without prejudice to the right of the Company or its
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successor to redeem convertible preferred stock for cash in accordance
herewith), a convertible preferred stock of the successor entity convertible
into Reorganization Units determined by dividing the Stated Value of such share
by the Fixed Price of such successor entity on the date which is 15 months after
the Issue Date.
If there is to occur any Reorganization, and any Reorganization Unit to be
issued in connection with such Reorganization does not have in whole or in part
a determina ble Applicable Price, then prior to the occurrence of such
Reorganization and on a basis such that the holders of Mandatorily Redeemable
Preferred Stock shall be holders of Common Stock for all purposes of such
Reorganization, the Company will redeem all Mandatorily Redeemable Preferred
Stock in accordance herewith. The Company shall not effect any Reorganization
unless prior to or simultaneously with the consummation thereof, the successor
entity resulting from such consolidation or merger or the entity purchasing such
assets or compelling such exchange, as the case may be, shall make provisions in
its certificate or articles of incorporation or other constituent document to
establish such right. The provisions of this paragraph (6)(a)(i) shall similarly
apply to successive Reorganizations.
(ii) Holding Company. Notwithstanding anything herein to the
contrary, if the Company is reorganized such that the Common Stock is exchanged
for the common stock of a new entity ("Holdco") whose common stock is traded on
NASDAQ or another recognized securities exchange, then the Company, by notice to
the holders of the Mandatorily Redeemable Preferred Stock but without any
required consent on their part, may cause the exchange of this Mandatorily
Redeemable Preferred Stock for mandatorily redeemable preferred stock of Holdco
having the same terms and conditions as set forth herein, provided that where
Holdco is not a Delaware company or where the Holdco share structure is not
identical to that of the Company, the rights attaching to the mandatorily
redeemable preferred stock of Holdco may be adjusted so as to comply with the
local law of the country of incorpo ration of Holdco or the new share structure
of Holdco subject to such rights effec tively giving the same economic rights as
the Mandatorily Redeemable Preferred Stock (ignoring for these purposes any
resultant change in the tax treatment for the holders of such stock).
(iii) Other Adjustments. In the event that, as a result of an
adjustment made pursuant to paragraph (6)(a), the holder of any Mandatorily
Redeemable Preferred Stock thereafter surrendered for redemption shall become
entitled to receive any shares of capital stock of the Company other than shares
of its Convert ible Preferred Stock, thereafter the number of such shares
issuable upon redemption of such security shall be subject to adjustment from
time to time in a manner and on
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terms as nearly equivalent as practicable to the provisions with respect to the
Convertible Preferred Stock contained in paragraph (5).
(b) Notices of Corporate Action. If:
(i) the Company or the Board shall approve any Reorganization to
which the Company is a party and for which approval of any stockholders of the
Company is required; or
(ii) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in each case, the Company shall cause to be given to the holders of shares
of the Mandatorily Redeemable Preferred Stock in accordance with paragraph (14),
as promptly as possible, but at least 10 days prior to the applicable date
hereinafter specified, a notice stating the date on which the event giving rise
to an adjustment of the type described in paragraph (6)(a), such a
Reorganization, dissolution, liquidation or winding up may occur, as the case
may be, is expected to become effective or occur, and, if earlier, 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 stock of the Company, securities,
cash or other property deliverable upon such Reorganiza tion, dissolution,
liquidation or winding up. Failure to give or receive such notice or any defect
therein shall not affect the legality or validity of the action or transactions
described in sub-paragraphs (i) or (ii) above.
(c) Listing of Common Stock. The Company will list the shares of
Common Stock required to be delivered as payment of dividends or upon redemption
or conversion of shares of the Mandatorily Redeemable Preferred Stock, prior to
delivery, upon each national securities exchange, the Nasdaq Stock Market's Na
tional Market or any similar system of automated dissemination of securities
prices, if any, upon which the Common Stock is listed at the time of delivery.
(d) Provision of Information. So long as any shares of Mandatorily
Redeemable Preferred Stock remain outstanding, the Company undertakes to provide
without charge to each record holder of such shares copies of each: (i) annual
report of the Company on Form 10-K filed pursuant to Section 13(a) of the
Exchange Act concurrently with such filing; (ii) quarterly reports of the
Company on Form 10-Q and current report of the Company on Form 8-K filed
pursuant to Section 13(a) or 15(d) or the Exchange Act concurrently with such
filing; (iii) definitive proxy or information statement, form of proxy or other
material of the Company filed pursu ant to Section 14(a) of the Exchange Act
concurrently with such filing; and (iv) notice, press release and other
information delivered to holders of Common Stock generally concurrently with
such delivery.
(7) LIMITATIONS ON DIVIDENDS AND REDEMPTIONS IN RESPECT OF COMPANY
STOCK.
(a) Limitations on Junior Stock Dividends. As long as any shares of
Mandatorily Redeemable Preferred Stock are outstanding, no dividends shall be
paid or declared in cash on Junior Stock, nor shall any other distributions be
made on any Junior Stock, unless: (i) full dividends on all Parity Stock have
been paid, or declared and set aside for payment, for all dividend periods
terminating on or prior to the date of such Junior Stock dividend or
distribution payment, to the extent such dividends are cumulative; (ii) the
Company has paid or set aside all amounts, if any, then or therefore required to
be paid or set aside for all purchase, retirement, and sinking funds, if any,
for any Parity Stock; and (iii) the Company is not in default on any of its
obligations to redeem any Parity Stock.
(b) Limitations on Purchase of Junior Stock. As long as any shares
of Mandatorily Redeemable Preferred Stock are outstanding, no shares of any
Junior Stock may be purchased, redeemed, or otherwise acquired by the Company or
any of its Subsidiaries (except in connection with a reclassification of any
Junior Stock through the issuance of other Junior Stock and/or Convertible
Securities for shares of Junior Stock and cash in lieu of fractional shares in
connection therewith or the purchase, redemption or other acquisition of any
Junior Stock from any wholly-owned subsidiary), nor may any funds be set aside
or made available for any sinking fund for the purchase, redemption or other
acquisition of any Junior Stock, unless: (i) full dividends on all Parity Stock
have been paid, or declared and set aside for payment, for all dividend periods
terminating on or prior to the date of such pur chase, redemption or
acquisition, to the extent such dividends are cumulative; (ii) the Company has
paid or set aside all amounts, if any, then or theretofore required to be paid
or set aside for all purchases retirement, and sinking funds, if any, for any
Parity Stock; and (iii) the Company is not in default on any, of its obligations
to redeem any Parity Stock.
(c) Junior Stock Dividends Otherwise Permitted. Subject to the
provisions of paragraphs (7)(a) and 8(b), dividends or distributions (payable in
cash, property or securities) may be declared and paid on the shares of any
Junior Stock from time to time and any Junior Stock may be purchased, redeemed
or otherwise acquired by the Company or any of its subsidiaries from time to
time. In the event of
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the declaration and payment of any such dividends or distributions, the holders
of such Junior Stock will be entitled, to the exclusion of holders of shares of
Convert ible Preferred Stock, to share therein according to their respective
interests.
(d) Limitations on Parity Stock Dividends and Redemptions. As long
as any share of Mandatorily Redeemable Preferred Stock is outstanding, dividends
or other distributions may not be declared or paid on any Parity Stock, and the
Com pany may not purchase, redeem or otherwise acquire any Parity Stock (except
(x) from any wholly owned subsidiaries of the Company or (y) in connection with
a mandatory conversion or exchange of such Parity Stock or a conversion or
exchange of such Parity Stock at the option of the holder for securities other
than Parity Stock or Senior Stock and cash in lieu of fractional shares in
connection therewith) unless either:
(a)(i) full dividends on all Parity Stock have been paid, or
declared and set aside for payment, for all dividend periods terminating
on or prior to the date of such Parity Stock dividend, distribution,
purchase, re demption or other acquisition payment, to the extent such
dividends are cumulative;
(ii)the Company has paid or set aside all amounts, if any, then
or theretofore required to be paid or act aside for all purchase,
retirement, and sinking funds, if any, for any, Parity Stock; and
(iii)the Company is not in default on any of its obligations to
redeem any Parity Stock, or
(b) with respect to the payment of dividends only, any such
dividends are declared and paid pro rata so that the amounts of any
dividends declared and paid per share on shares of Mandatorily Redeemable
Preferred Stock and each other share of such Parity Stock will in all
cases bear to each other the same ratio that accrued and unpaid dividends
(including any accumulation with respect to unpaid dividends for prior
dividend periods, if such dividends are cumulative) per share on shares of
Mandatorily Redeemable Preferred Stock and such other share of Parity
Stock bear to each other.
(e) Certain Permitted Dividends and Redemptions. Nothing contained
in this paragraph (7) shall prevent: (i) the payment of dividends or the making
of distributions on any Junior Stock solely in shares of Junior Stock and/or
Convertible Securities for shares of Junior Stock (together with a cash
adjustment for
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fractional shares, if any) or the redemption, purchase or other acquisition of
Junior Stock solely in exchange for (together with a cash adjustment for
fractional shares, if any), or through the application of the proceeds from the
sale of, shares of Junior Stock and/or Convertible Securities for shares of
Junior Stock; (ii) the payment of dividends or the making of distributions on
any class or series of Parity Stock solely in (together with a cash adjustment
for fractional shares, if any) shares of Junior Stock and/or Convertible
Securities for shares of Junior Stock or the redemption, exchange, purchase or
other acquisition of say class or series of Parity Stock solely in exchange for
(together with a cash adjustment for fractional shares, if any), or through the
application of the proceeds from the sale of shares of Junior Stock and/or
Convertible Securities for shares of Junior Stock or (iii) the conversion or
exchange of Mandatorily Redeemable Preferred Stock into shares of Common Stock
(together with a cash adjustment for fractional shares, if any) and other
securities, assets or property, if any pursuant to the provisions of paragraphs
(4), (5) or (6).
(f) Waiver. The provisions of paragraphs (7)(a), (b) and (d) are for
the sole benefit of the holders of Mandatorily Redeemable Preferred Stock and
any other class or series of Parity Stock having the terms described therein and
accord ingly, at any time when (i) there are no shares of any such other class
or series of Parity Stock outstanding or if the holders of each such other class
or series of Parity Stock have, by such vote or consent of the holders thereof
as may be provided for in the instrument creating or evidencing such class or
series, waived in whole or in part the benefit of such provisions (either
generally or in the specific instance), and (ii) the holders of shares of
Mandatorily Redeemable Preferred Stock shall have waived (as provided in
paragraph (15)) in whole or in part the benefit of such provision (either
generally or in the specific instance), then the provisions of paragraphs
(7)(a), (b) and (d) shall not (to the extent waived, in the case of any partial
waiver) restrict the payment of dividends or the making of distributions on, or
the redemption, purchase or other acquisition of any shares of, Mandatorily
Redeemable Preferred Stock, any other class or series of Parity Steel or any
Junior Stock.
(8) LIQUIDATION RIGHTS.
(a) Payment of Liquidation Preference. If there is any liquidation,
dissolution, or winding up of the Company, whether voluntary or involuntary,
then the holders of shares of Mandatorily Redeemable Preferred Stock then
outstanding, after payment, or provision for payment of the debts and other
liabilities of the Company and the payment or provision for payment of any
distribution on any shares of Senior Stock, and before any distribution to the
holders of Junior Stock, shall be entitled to be paid out of the assets of the
Company available for distribution
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to its stockholders an amount per share of Mandatorily Redeemable Preferred
Stock in cash equal to the Liquidation Preference. If the assets of the Company
available for distribution to the holders of the shares of Mandatorily
Redeemable Preferred Stock upon any dissolution, liquidation or winding up of
the Company shall be insufficient to pay in full the Liquidation Preference
payable to the holders of outstanding shares of Mandatorily Redeemable Preferred
Stock and the liquidation preference payable to all other shares of Parity Stock
(as set forth in the instrument or instruments creating such Parity Stock), then
the holders of shares of Mandatorily Redeemable Preferred Stock and of all other
shares of Parity Stock shall share ratably in such distribution of assets in
proportion to the amount which would be payable on such distribution if the
amounts to which the holders of outstanding shares of Mandatorily Redeemable
Preferred Stock and the holders of outstanding shares of such other Parity Stock
were paid in full. Except as provided in this paragraph (8)(a), holders of
Mandatorily Redeemable Preferred Stock shall not be entitled to any distribution
in the event of the liquidation, dissolution or winding up of the affairs of the
Company.
(b) Certain Events Not Deemed Liquidation, Etc. For the purposes of
this paragraph (8) a Reorganization shall not be deemed to be a voluntary of
involuntary liquidation, dissolution or winding up of the Company.
(9) NO FRACTIONAL SHARES. No fractional shares of Common Stock or
Convertible Preferred Stock or scrip shall be issued in connection with the
delivery of shares of Common Stock or Convertible Preferred Stock in payment, in
whole or in part, of any dividend, Redemption Price or Liquidating Payment.
Whether or not a fractional share would be delivered to a holder of Mandatorily
Redeemable Preferred Stock shall be based upon, in the case of the payment, in
whole or in part, of dividends, a Redemption Price of a Liquidating Payment
pursuant to paragraphs (3), (4) or (8) , respectively, on the total number of
shares of Mandatorily Redeemable Preferred Stock at the time held by such holder
and the total number of shares of Common Stock or Convertible Preferred Stock,
otherwise deliverable in respect thereof. Instead of the issuance of a fraction
of a share of Common Stock or Convertible Preferred Stock or scrip, the Company
shall pay instead an amount in cash (rounded to the nearest whole cent) equal
to, in the case of Common Stock, the same fraction of the Closing Price of a
share of preceding the Determination Date and, in the case of Convertible
Preferred Stock, equal to the same fraction of the Convertible Preferred Stock
Issue Price.
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32
(10) PAYMENT OF TAXES. The Company shall pay any and all
documentary, stamp or similar transfer taxes payable in respect of the delivery
of shares of Common Stock or Convertible Preferred Stock, pursuant to paragraphs
(3), (4), (5), or (8), as applicable; provided, however, the Company shall not
be required to pay any such tax that may be payable because any such shares are
issued in a name other than the name of the holder of such Mandatorily
Redeemable Preferred Stock.
(11) NO PREEMPTIVE RIGHTS. The holders of shares of Mandatorily
Redeemable Preferred Stock shall have no preemptive rights, including preemptive
rights with respect to any shares of capital stock or other securities of the
Company convertible into or carrying rights or options to purchase any such
shares.
(12) VOTING RIGHTS. (a) The holders of shares of Mandatorily
Redeemable Preferred Stock shall have no Voting rights, except as otherwise
required by law and except as set forth in this paragraph (12). When and if the
holders of Mandatorily Redeemable Preferred Stock are entitled to vote by law or
pursuant to this paragraph (12), each holder will be entitled to one vote per
share.
(b) Certain Changes to Charter. For as long as any shares of
Mandatorily Redeemable Preferred Stock remain outstanding, the affirmative vote
of the holders of at least a majority of such outstanding shares (voting
separately as a class) given in Person or by proxy at an annual meeting or a
special meeting called for such purpose, shall be necessary (i) before the
Company may amend any of the provisions of this Certificate of Designations or
the Restated Certificate of Incorpora tion of the Company which would alter or
change the powers, preferences or special rights of the holders of the shares of
Mandatorily Redeemable Preferred Stock then outstanding so as to affect them
adversely; provided, however, that:
(x) any such amendment that would authorize, create or increase the
authorized amount of any additional shares of Junior Stock or shares
of any other class or series of Parity Stock (whether or not already
authorized); and
(y) any such amendment that would increase the number of authorized
shares of Preferred Stock of the Company (but not the number of
authorized shares of Mandatorily Redeemable Preferred Stock) or that
would decrease (but not below the number of shares, then
outstanding) the number of authorized shares of Preferred Stock
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33
(but not the number of authorized shares of Mandatorily Redeemable
Preferred Stock);
shall be deemed not to adversely affect such powers preferences or rights and
shall not be subject to approval by the holders of shares of Mandatorily
Redeemable Preferred Stock; and (ii) before the Company may reclassify the
outstanding shares of Mandatorily Redeemable Preferred Stock into another class
or series of capital stock of the Company; provided further, however, that no
consent described in clause (i) of this paragraph of the holders of the shares
of Mandatorily Redeemable Pre ferred Stock shall be required if, at or prior to
the time when such amendment is to take effect, provision is made for the
redemption of all shares of Mandatorily Redeemable Preferred Stock at the time
outstanding.
(c) Creation of Senior Stock. No consent or vote of the holders of
the shares of Mandatorily Redeemable Preferred Stock shall be necessary before
the Company or the Board may authorize, create or issue any class or series of
Senior Stock.
(d) No Other Vote. Except as otherwise set forth in this paragraph
(12) or as required by law, the holders of Mandatorily Redeemable Preferred
Stock shall not have any relative, participating, optional or other special
voting rights and powers and the consent or vote of such holders shall not be
required for the taking of any corporate action by the Company or the Board. The
provisions of this paragraph (12) are in lieu of, and not in addition to, any
voting rights specified in the Restated Certificate of Incorporation as
applicable to a series of Preferred Stock.
(13) PAYMENTS. Payment of cash amounts due in respect of the
Mandatorily Redeemable Preferred Stock will be paid to the holders of shares of
Mandatorily Redeemable Preferred Stock (or, in the case of joint holders, the
first-named) as appearing in the stock register of the Company for the
Mandatorily Redeemable Preferred Stock as at opening of business (New York time)
on the date specified in this Certificate for the purpose of determining the
holders of Mandatorily Redeemable Preferred Stock entitled to such payments or,
if no such date is speci fied, the fifteenth Business Day before the due date
for such payment (the "Payment Record Date").
Payments of cash amounts due in respect of the Mandatorily Re
deemable Preferred Stock will be made by a check in U.S. dollars drawn on a bank
in New York and mailed to the address (as recorded is the stock register of the
Com pany for the Mandatorily Redeemable Preferred Stock) of the holder thereof
(or, in
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the case of joint holders, the first-named) not later than the relevant date for
payment unless, prior to the relevant Payment Record Date, the Company has
received from the holder thereof (or, in the case of joint holders, the
first-named) written instruc tions for payment to be made by wire transfer to a
specified designated account. If the due date for payment of any cash amount in
respect of the Mandatorily Redeem able Preferred Stock is not a Business Day,
then the holder thereof will not be entitled to payment thereof until the next
following day which is a Business Day and, if such payment is to be made by
transfer to a designated account rather than by check, a day on which commercial
banks and foreign exchange markets settle, payments in U.S. dollars in the place
where the relevant designated account is located.
(14) NOTICES. Any notice or communication by a holder of Mandatorily
Redeemable Preferred Stock to the Company is duly given if in writing and
delivered in person or mailed by first-class mail to the Company at its address
as set forth in its then most recently filed Form 10-K or 10-Q as the case may
be.
Any notice or communications to a holder of Mandatorily Redeem able
Preferred Stock shall be mailed by first-class mail to his address shown on the
stock register of the Company for the Mandatorily Redeemable Preferred Stock or,
if there are more than 20 holders of record of the Mandatorily Redeemable
Preferred Stock and the Company in its sole discretion so elects, in a leading
daily newspaper having general circulation in New York (which is expected to be
the Wall Street Journal) or England and Wales (which is expected to be The
Financial Times). Failure to mail a notice or communication to one holder or any
defect in it shall not affect its sufficiency with respect to other holders.
If a notice or communication is given in the manner provided in this
paragraph (14) within the time prescribed by this Certificate, it shall be
conclusively presumed to have been duly given, whether or not the person
entitled to such notice receives it.
(15) WAIVER. Any provision of this Certificate of Designations
which, for the benefit of the holders of Mandatorily Redeemable Preferred Stock,
prohibits, limits or restricts actions by the Company may be waived in whole or
in part, or the application of all or any part of such provision in any
particular circum stance or generally may be waived, in each case with the
consent of the holders of at least a majority of the number of shares of
Mandatorily Redeemable Preferred Stock then outstanding, either in writing or by
vote at a meeting called for such purpose at
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35
which the holders of Mandatorily Redeemable Preferred Stock shall vote as a
separate class.
(16) REGISTRATION AND NO TRANSFER. The Company will maintain at its
principal executive office a register in which the Company will provide for the
registration of shares of Mandatorily Redeemable Preferred Stock. The shares of
Mandatorily Redeemable Preferred Stock are not transferrable, and any
certificate representing shares of Mandatorily Redeemable Preferred Stock will
be so legended.
(17) EXCLUSION OF OTHER RIGHTS. Except as may otherwise be required
by law, the shares of Mandatorily Redeemable Preferred Stock shall not have any
designations, preferences, limitations or relative rights other than those
specifically set forth in this Certificate of Designations.
(18) SEVERABILITY OF PROVISIONS. Whenever possible, each provision
of this Certificate of Designations shall be interpreted in a manner as to be
effective and valid under applicable law, but if any provision hereof is held to
be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating or otherwise adversely affecting the remaining provisions hereof.
If a court of competent jurisdic tion should determine that a provision hereof
would be valid or enforceable if a period of time were extended or shortened or
a particular percentage were increased or decreased, then such court may make
such change as shall be necessary to render the provision in question effective
and valid under applicable law.
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Draft of Convertible Preferred Stock
CERTIFICATE OF DESIGNATIONS
OF
PREFERRED STOCK
OF
NTL INCORPORATED
-----------------
PURSUANT TO SECTION 151(G) OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
-----------------
The undersigned, Senior Vice President, General Counsel and
Secretary of NTL Incorporated, a Delaware corporation (the "Company"), HEREBY
CERTIFIES that the Board of Directors, in accordance with Article IV, Section B
of the Company's Restated Certificate of Incorporation and Section 151(g) of the
Delaware General Corporation Law (the "DGCL"), has authorized the creation of
the series of Preferred Stock hereafter provided for and has established the
dividend, redemption, conversion and voting rights thereof and has adopted the
following resolution, creating the following new series of the Company's
Preferred Stock:
"BE IT RESOLVED, that pursuant to authority expressly granted to the
Board of Directors by the provisions of Article IV, Section B of the Restated
Certificate of Incorporation of the Company and Section 151(g) of the DGCL,
there is hereby created and authorized the issuance of a new series of the
Company's Preferred Stock, par value $.01 per share ("Preferred Stock"), with
the following powers, designations, dividend rights, voting powers, rights on
liquidation, conver sion rights, redemption rights and other preferences and
relative, participating, optional or other special rights and with the
qualifications, limitations or restrictions
B-26
37
on the shares of such series (in addition to the powers, designations,
preferences and relative, participating, optional or other special rights and
the qualifications, limita tions or restrictions thereof set forth in the
Restated Certificate of Incorporation that are applicable to each series of
Preferred Stock) hereinafter set forth:
(19) Designation; Number of Shares. The designation of the series of
Preferred Stock, par value $.01 per share, of the Company created hereby shall
be " % Non-voting Convertible Preferred Stock, Series A" (including, in the case
of any reclassification, recapitalization, or other change to such Preferred
Stock or, in the case of a consolidation or merger of the Company with or into
another Person affecting such Preferred Stock, such capital stock to which a
holder of such Preferred Stock shall be entitled upon the occurrence of such
event, the "Convertible Preferred Stock"). The authorized number of shares of
Convertible Preferred Stock shall be
, which number may from time to time be increased or decreased (but not
below the number then outstanding). Each share of Convertible Preferred Stock
shall have a stated value of $ (the "Stated Value").
Any shares of Convertible Preferred Stock redeemed or otherwise
acquired by the Company shall be retired and shall resume the status of
authorized and unissued shares of Preferred Stock, without designation as to
series, until such shares are once more designated as part of a particular
series of Preferred Stock by the Board of Directors.
(20) Certain Definitions. Unless the context otherwise requires, the
terms defined in this paragraph (2) shall have, for all purposes of this
Certificate of Designations, the meanings herein specified:
"Applicable Price" shall mean the aggregate of (A) in the event of a
Reorganization in which the holders of Common Stock receive cash, the amount of
such cash receivable by the holder of one share of Common Stock (as such share
is in effect immediately prior to the consummation of such Reorganization); and
(B) in the event of a Reorganization in which the holders of Common Stock
receive securities or other property which are traded on an established market
(within the meaning of Treasury Regulation 1.1273-2(f)(1) of the Internal
Revenue Code of 1986, as in effect on September 30, 1990), the average (or if
there be more than one security or item of property the sum of the averages) of
the daily Trading Prices of such securities and/or property receivable by the
holder of one share of Common Stock (as such share is in effect immediately
prior to such consummation) for the period of ten consecutive Trading Days
ending on the Trading Day immediately preceding the Conversion Date, date of
occurrence of the Reorganization, appropri ately adjusted to take into account
any stock dividend on such security or property, or any subdivision, split,
combination, reclassification of such security or property that occurs or the
"ex" date for which occurs on or prior to such date.
"Average Market Price" on any Determination Date, shall mean the
average of the daily Closing Prices for the period of 10 consecutive Trading
Days, ending on the Trading Day immediately preceding such Determination Date,
appropriately adjusted to take into account any stock dividend on the Common
Stock or any subdivision, split, combination or reclassification of the Common
Stock that occurs, or the Ex-Dividend Date for which occurs, during the period
following the first Trading Day in such ten-Trading Day period to and including
the Determination Date.
"Board" shall mean the Board of Directors of the Company, and,
unless the context indicates otherwise, shall also mean, to the extent permitted
by law, any committee thereof authorized, with respect to any particular matter,
to exercise the power of the Board of Directors of the Company with respect to
such matter.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in New York, New York and London, England are
authorized to close or not obligated by law or executive order to open.
"Closing Price" shall mean, on any day:
(i) the average between the high and low reported sale price of a
share of Common Stock on and as reported by the Nasdaq Stock Market's National
Market on such day;
(ii) if the primary trading market for the Common Stock on such day
is not the Nasdaq Stock Market's National Market, then the closing sale price
regular way on such day, or, in case no such sale takes place on such day, the
average of the reported closing bid and asked prices regular way on such day, in
either case as reported by the Nasdaq System, the National Quotations Bureau,
Inc. or a compara ble service;
(iii) if the Closing Price on such day is not available pursuant to
one of the methods specified above, then the average of the bid and asked prices
for the Common Stock on such day as furnished by any New York Stock Exchange
member firm selected from time to time by the Board for that purpose; or
B-27
38
(iv) if the Closing Price on such day is not available pursuant to
the method specified in (iii) above, the determination of Closing Price shall be
deter mined in good faith by the Board exercising its reasonable discretion.
"Common Stock" shall mean the shares of common stock, par value
$0.01 per share, of the Company, which term shall include, where appropriate, in
the case of any reclassification, recapitalization or other change in the Common
Stock, or in the case of a consolidation or merger of the Company with or into
another Person affecting the Common Stock, such capital stock to which a holder
of Com mon Stock shall be entitled upon the occurrence of such event.
"Common Stock Dividend Amount" shall have the meaning set forth in
paragraph (3) (c).
"Computation Date" shall mean the earlier of (a) the date on which
the Company shall enter into a firm contract or commitment for the issuance of
Options or Convertible Securities or (b) the date of actual issuance of such
Options or Convertible Securities.
"Conversion Date" shall have the meaning set forth in paragraph
(5)(c).
"Convertible Preferred Stock" shall have the meaning set forth in
paragraph (1).
"Convertible Securities" shall mean evidences of indebtedness or
shares of stock which are, at the option of the holder hereof, convertible into
or exchangeable for shares of Common Stock.
"Current Market Price" on the Determination Date for any issuance of
Options or Convertible Securities or any distribution in respect of which the
Current Market Price is being calculated, shall mean the average of the daily
Closing Prices of the Common Stock for the shortest of:
(i) the period of 10 consecutive Trading Days ending on the last
full Trading Day before such Determination Date,
(ii) the period commencing on the date next succeeding the first
public announcement of the issuance of Options or Convertible Securities or the
B-28
39
distribution in respect of which the Current Market Price is being calculated
and ending on the last full Trading Day before such Determination Date, and
(iii) the period, if any, commencing on the date next succeeding the
Ex-Dividend Date with respect to the relevant issuance of Options or Convertible
Securities or the relevant distribution for which an adjustment is required by
the provisions of paragraphs (6)(a)(ii) or (iii), and ending on the last full
Trading Day before such Determination Date.
If multiple events occur which require adjustment pursuant to
paragraph (6)(a), the adjustment required by each such event shall be given
effect in the order of occurrence but without duplication.
"Denominator" shall mean the Fixed Price on the applicable Determi
nation Date.
"Determination Date" shall mean: (i) in the case of a dividend
payment, the date of notice of the Record Date, (ii) in the case of a redemption
payment, the Redemption Date, (iii) in the case of a conversion, the date of
notice of the Conversion Date, (iv) in the case of a Reorganization, the date
the Reorganization occurs and (v) in the case of any issuance of Options or
Convertible Securities or any distribution to which paragraphs (6)(a)(ii) or
(iii) respectively apply, the earlier of (a) the record date for the
determination of stockholders entitled to receive the Options, Convertible
Securities, or the distribution to which such paragraphs apply and (b) the
Ex-Dividend Date for such Options, Convertible Securities or distribution.
"Dividend Non-Payment" shall have the meaning set forth in para
graph (12)(b).
"Dividend Payment Date" shall have the meaning set forth in para
graph (3)(a).
"Dividend Period" for any dividend payable on a Dividend Payment
Date shall mean the period beginning on the immediately preceding Dividend
Payment Date (or on the Issue Date in the case of the first Dividend Period) and
ending on the day preceding such later Dividend Payment Date.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, or any successor statute, and the rules and
regulations promulgated thereunder.
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40
"Ex-Dividend Date" shall mean the date on which "ex-dividend"
trading commences for a dividend, an issuance of Options or Convertible
Securities or a distribution to which paragraph (6)(a) applies in the Nasdaq
Stock Market's National Market or on the principal exchange on which the Common
Stock is then quoted or traded.
"Fixed Price", on any Determination Date, shall mean $ ,* subject to
adjustment as prescribed in paragraph (6)(a).
"Issue Date" shall mean the date on which the Convertible Preferred
Stock is issued as payment of dividends or upon redemption of shares of the
Mandatorily Redeemable Preferred Stock, as set forth in the Certificate of
Designa tions relating to such Mandatorily Redeemable Preferred Stock.
"JPPF" shall mean the Series A Junior Participating Preferred Stock
of the Company issuable upon exercise of the Rights pursuant to the Rights Agree
ment.
"Junior Stock" shall mean:
(i) each class or series of common stock of the Company, including,
without limitation, the Common Stock;
(ii) the JPPF issuable upon exercise of the Rights;
(iii) any other class or series of capital stock of the Company
hereafter created, other than (a) any class or series of Parity Stock (except to
the extent provided under clause (iv) hereof) and (b) any class or series of
Senior Stock, and
(iv) any class or series of Senior Stock or Parity Stock to the
extent that it ranks junior to the Convertible Preferred Stock as to dividend
rights, rights of redemption or rights on liquidation, as the case may be. For
purposes of clause (iii) above, a class or series of Senior Stock or Parity
Stock shall rank junior to the Convertible Preferred Stock as to dividend
rights, rights of redemption or rights on liquidation if the holders of shares
of Convertible Preferred Stock shall be entitled to dividend payments, payments
on redemption or payments of amounts distributable
- --------
* 25% above Average Market Price on Issue Date, subject to adjustment
pursuant to paragraph (5)(e) of the 9.90% Preferred Stock.
B-30
41
upon dissolution, liquidation or winding up of the Company, as the case may be,
in preference or priority to the holders of shares of such class or series of
Senior Stock or Parity Stock.
"Liquidating Payment" shall mean an amount equal to the Liquidation
Preference of a share of Convertible Preferred Stock or, if less, the amount
payable in respect of one share of Convertible Preferred Stock pursuant to
paragraph (9)(a) upon the voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Company.
"Liquidating Payment Date" shall mean the date on which the Company
makes the aggregate Liquidating Payment to all holders of outstanding shares of
Convertible Preferred Stock.
"Liquidation Preference" measured per share of the Convertible
Preferred Stock, shall mean an amount equal to (a) the Stated Value per share of
Convertible Preferred Stock, plus (b) for purposes of determining the amount
payable pursuant to paragraph (8) only, an amount equal to all dividends accrued
but unpaid on such share, whether or not such unpaid dividends have been
declared or there are funds of the Company legally available for the payment of
dividends, to the Liquidating Payment Date.
"Mandatory Redemption Price" shall have the meaning set forth in
paragraph (4)(b).
"Option" shall mean any right, option or warrant entitling the
holder thereof to subscribe for, purchase, or otherwise acquire Common Stock in
the Company (other than the Rights).
"Parity Stock" shall mean the Convertible Preferred Stock and any
class or series of capital stock, whether now existing or hereafter created, of
the Company to the extent ranking on a parity basis with the Convertible
Preferred Stock as to dividend rights, rights of redemption or rights on
liquidation. Capital stock of any class or series, whether now or existing or
hereafter created, shall rank on a parity as to dividend, rights of redemption
or rights on liquidation with the Convert ible Preferred Stock, whether or not
the dividend rates, dividend payment dates, redemption or liquidation prices per
share or sinking fund or mandatory redemption provision, if any, are different
from those of the Convertible Preferred Stock, if the holders of shares of such
class or series shall be entitled to dividend payments, payments on redemption
of payments of amounts distributable upon dissolution,
B-31
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liquidation or winding up of the Company, as the case may be, in proportion to
their respective accumulated and accrued and unpaid dividends, redemption prices
or liquidation prices, respectively, without preference or priority, one over
the other, as between the holders of shares of such class or series and the
holders of Convertible Preferred Stock. No class or series of capital stock that
ranks junior to the Convert ible Preferred Stock as to rights on liquidation
shall rank or be deemed to rank on a parity basis with the Convertible Preferred
Stock as to dividend rights or rights of redemption.
"Payment Record Date" shall have the meaning set forth in paragraph
(13).
"Person" shall mean any individual corporation, partnership, joint
venture, association, joint stock company, limited liability company, trust,
unincor porated organization, government or agency or political subdivision
thereof, or other entity, whether acting in an individual, fiduciary or other
capacity.
"Preferred Stock Director" shall have the meaning set forth in
paragraph (12)(b).
"Preferred Stock Dividend Amount" shall have the meaning set forth
in paragraph (3)(d).
"Record Date" for the dividends payable on the Dividend Payment Date
shall mean the date (not exceeding 45 days preceding the Dividend Payment Date)
fixed by the Board as the record date for the Dividend Payment Date.
"Redemption Agent" shall have the meaning set forth under paragraph
(4)(f).
"Redemption Date" as to any share of Convertible Preferred Stock,
shall mean the date fixed by the Board for the redemption of such share pursuant
to paragraph (4).
"Redemption Notice" shall have the meaning set forth in paragraph
(4)(c).
"Redemption Price" shall have the meaning set forth in paragraph
(4)(a).
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"Reorganization" shall mean any of the following events:
(i) any consolidation or merger of the Company with another entity
(other than a merger or consolidation in which the Company is the surviving or
continuing corporation and in which the Common Stock outstanding immediately
prior to the merger or consolidation remains unchanged),
(ii) the sale or other transfer of all or substantially all of its
assets to another entity.
(iii) any reorganization or reclassification of the Common Stock or
other equity securities of the Company (other than a transaction to which
paragraph (6)(a)(i) applies), and
(iv) any statutory exchange of any shares of capital stock of the
Company with another corporation (other than a merger or consolidation in which
the Company is the surviving or continuing corporation and in which the Common
Stock outstanding immediately prior to the merger or consolidation remains un
changed).
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of , 1998, between the Company and Vision Net works III
B.V., as the same may be amended, supplemented or otherwise modified.
"Reorganization Unit" means the kind or amount of securities, cash
or other property receivable upon consummation of a Reorganization in
substitution of or in exchange for a share of Common Stock as such share is in
effect immediately prior to such consummation (provided that if the kind or
amount of securities, cash or other property receivable upon consummation of
such Reorganization is not the same with respect to each such share, then the
kind and amount of securities, cash or other property which shall be deemed
receivable upon consummation of such Reorganization with respect to each such
share for purposes hereof shall be the kind and amount so receivable per share
by a plurality of such shares).
"Rights" means the rights issuable pursuant to the Rights Agreement.
"Rights Agreement" means the rights agreement, dated as of October
13, 1993, between the Company and Continental Transfer and Trust Company, as
rights agent.
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"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time, or any successor statute, and the rules and regulations
promul gated thereunder.
"Senior Stock" shall mean any class or series of capital stock of
the Company hereafter created to the extent ranking prior to the Convertible
Preferred Stock as to dividend rights, rights of redemption or rights on
liquidation. Capital stock of any class or series shall rank prior to the
Convertible Preferred Stock as to dividend rights, rights of redemption or
rights on liquidation if the holders of shares of such class or series shall be
entitled to dividend payments, payments on redemp tion or payments of amounts
distributable upon dissolution, liquidation or winding up of the Company, as the
case may be, in preference or priority to the holders of shares of Convertible
Preferred Stock. No class or series of capital stock than ranks on a parity
basis with or junior to the Convertible Preferred Stock as to rights on
liquidation shall rank or be deemed to rank prior to the Convertible Preferred
Stock as to dividend rights or rights of redemption, notwithstanding that the
dividend rate, dividend payment dates, sinking fund provisions, if any, or
mandatory redemption provisions thereof are different from those of the
Convertible Preferred Stock.
"Stated Value" shall have the meaning set forth in paragraph (1).
"Trading Day" shall mean a day on which the Nasdaq Stock Market's
National Market or, if different, the principal exchange on which the Common
Stock is quoted or traded is each open for the transaction of business.
"Trading Price" of a security or property for any day means the
closing sale price regular way on such day, or, in case no such sale takes place
on such day, the average of the reported closing bid and asked prices of such
security or property on such day on the applicable established market on which
such security or property is traded.
(21) DIVIDENDS.
(a) Payment. The holders of outstanding shares of Convertible
Preferred Stock shall be entitled to receive, when, as and if declared by the
Board out of funds legally available therefor (without prejudice to paragraph
(3)(b)), cumula tive dividends, in preference to dividends on any Junior Stock,
at the rate per annum of % of the Stated Value per share, rounded to the nearest
cent. Such dividends shall accrue from the Issue Date and shall be payable
semi-annually in arrears, in whole or in part, on [ ] and [ ] of each year
(each, a "Dividend Payment
B-34
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Date") commencing on the second anniversary of the Issue Date; provided,
however, that with respect to any Dividend Period during which a redemption or
conversion occurs, the Board shall declare accrued dividends to, and pay such
dividends on, the related Redemption Date or Conversion Date, respectively, in
which case such dividends shall be payable on such Redemption Date or Conversion
Date, respec tively, to the holders of the shares of Convertible Preferred Stock
as of a special record date (not to exceed 45 days preceding the payment date)
for such dividend payment. Each dividend on the shares of Convertible Preferred
Stock shall be payable to holders of record as they appear on the stock register
of the Company on the Record Date or, as the case may be, the special record
date for such dividend and, for purposes of calculating the accrual of
dividends, dividends will accrue to, but not including, the date fixed for
payment.
Dividends on the outstanding shares of Convertible Preferred Stock
will accrue on a daily basis (without interest or compounding) whether or not
there are funds legally available for the payment of such dividends and whether
or not such dividends are declared. Dividends will cease to accrue in respect of
shares of Convertible Preferred Stock on the date of their redemption or
conversion. No interest, or sum of money in lieu of interest, shall be payable
in respect of any accrued dividend payment.
(b) Declaration and Manner of Payment of Dividends. The Board shall
declare and cause to be paid accrued but unpaid dividends on the Convertible
Preferred Stock at the rates, times and one for the forms described herein to
the maximum extent that the Company has funds legally available therefor;
provided, however, that without prejudice to the accrual thereof, such dividends
need not be declared or paid in cash to the extent the payment thereof is
prohibited by the terms and provision of any agreement of the Company referred
to in paragraph (3)(e). Any dividends may be paid, in the sole discretion of the
Board: (i) in cash out of funds legally available therefor; (ii) through the
delivery of shares of Common Stock; (iii) through the delivery of additional
shares of Convertible Preferred Stock; or (iv) through any combination of the
foregoing forms of consideration elected by the Board in its sole discretion;
provided, however, that if the Board shall fail to declare and cause to be paid
an accrued dividend payment in cash on any Dividend Payment Date (whether or not
there are unrestricted funds legally available for the payment of such dividends
in cash), then the Board shall declare and cause to be paid accrued dividends,
whether or not cumulated, through the delivery of shares of Common Stock or
additional shares of Convertible Preferred Stock to the extent permitted by
applicable law, regardless of the terms and provisions of any agreement of the
Company of the type referred to in paragraph (3)(e) including any agreement
relating
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to any indebtedness of the Company. If any dividend declared by the Board is to
be paid, in whole or in part, through the delivery of shares of Common Stock or
additional shares of Convertible Preferred Stock, each holder of Convertible Pre
ferred Stock shall receive the same proportion of cash and/or shares of Common
Stock and/or additional shares of Convertible Preferred Stock (except for cash
paid in lieu of fractional shares) delivered in payment of such dividend to
other holders of shares of Convertible Preferred Stock.
(c) Payment of Dividends by Delivery of Common Stock. If the Company
elects to pay any dividend payment, in whole or in part, by delivery of shares
of Common Stock, the amount of such dividend payment to be paid per share of
Convertible Preferred Stock in shares of Common Stock (the "Common Stock
Dividend Amount") shall be paid through the delivery to the holders of record
for such shares of Convertible Preferred Stock on the Record Date for such
dividend payment of a number of shares of Common Stock determined by dividing
the Common Stock Dividend Amount by the Average Market Price. No fractional
shares of Common Stock shall be delivered to a holder of shares of Convertible
Preferred Stock, but the Company shall instead pay a cash adjustment determined
as provided in paragraph (9).
(d) Payment of Dividends by Delivery of Additional Convertible
Preferred Stock. If the Company elects to pay any dividend payment, in whole or
in part, by delivery of additional shares of Convertible Preferred Stock, the
amount of such dividend payment to be paid per share of Convertible Preferred
Stock in additional shares of Convertible Preferred Stock (the "Preferred Stock
Dividend Amount") shall be paid through the delivery to the holders of record of
such shares of Convertible Preferred Stock on the Record Date for such dividend
payment of a number of shares of Convertible Preferred Stock determined (i) if
on such date the Fixed Price is higher than the Average Market Price, then by
dividing (A) the product of multiplying the Fixed Price by the Preferred Stock
Dividend Amount by (B) the product of multiplying the Average Market Price of
the Common Stock by the Stated Value, or (ii) if on such date the Fixed Price is
lower than the Average Market Price, then by dividing the Preferred Stock
Dividend Amount by the Stated Value. No fractional shares of Convertible
Preferred Stock shall be delivered to a holder of shares of Convertible
Preferred Stock, but the Company shall instead pay a cash adjustment determined
in accordance with paragraph (9).
(e) Prohibitions on Cash Dividends. Notwithstanding anything
contained in this Certificate to the contrary, but without effect on the accrual
thereof, no cash dividends on shares of Convertible Preferred Stock shall be
declared by the
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Board or paid or set apart for payment by the Company at such time as the terms
and provisions of any agreement of the Company, including, without limitation,
any agreement, contract, indenture, bond, note, debenture, guarantee or other
instrument relating to or evidencing its indebtedness, prohibits such
declaration, payment or setting apart for payment or provides that such
declaration, payment or setting apart for payment would constitute a breach
thereof or a default thereunder; provided, however, that nothing contained in
this paragraph (e) shall alter, limit or restrict the Company's obligation to
declare and pay accrued dividends, to the extent permitted by applicable law,
through the delivery of shares of Common Stock or additional shares of
Convertible Preferred Stock pursuant to the proviso contained in the second
sentence of paragraph (3)(b), whether permitted by any such agreement or not.
(f) Pro Rata. All dividends paid with respect to the shares of Con
vertible Preferred Stock shall be paid pro rata (as nearby as may be
practicable) to the shareholders entitled thereto.
(g) Credit. Any dividend payment made on the shares of Convertible
Preferred Stock shall first be credited against the earliest accrued but unpaid
dividend due with respect to the shares of Convertible Preferred Stock.
(h) Priority. Payment of dividends to the holders of shares of
Convertible Preferred Stock shall be subject to the prior preferences and other
rights of any Senior Stock and to the provisions of paragraph (7).
(22) REDEMPTION.
(a) Optional Redemption. At any time during the period beginning on
the third anniversary of the Issue Date until the Redemption Date, the Company
shall have the right to redeem the outstanding shares of Convertible Preferred
Stock at a price equal to $1,000 per share, together with an amount equal to all
dividends accrued but unpaid thereon to the date fixed for redemption (the
"Redemption Price").
The Company shall not be required to register a transfer of (i) any
shares of Convertible Preferred Stock for a period of 5 Business Days next
preceding any selection of shares of Convertible Preferred Stock to be redeemed
or (ii) any shares of Convertible Preferred Stock called for redemption.
(b) Mandatory Redemption. All outstanding shares of Convertible
Preferred Stock shall be mandatorily redeemed by the Company out of funds
legally
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available therefor on the date that is the tenth anniversary of Issue Date at a
redemp tion price equal to $1,000 per share, plus an amount equal to all accrued
and unpaid dividends per share (the "Mandatory Redemption Price").
(c) Company's Right to Elect Manner of Payment of Redemption Price.
The Company may effect the redemption of shares of Convertible Preferred Stock
at the Redemption Price or the Mandatory Redemption Price, in the sole
discretion of the Board: (i) in cash out of funds legally available therefor,
(ii) in exchange for and through the delivery of shares of Common Stock or (iii)
through any combination of the foregoing forms of consideration elected by the
Board in its sole discretion.
(d) Notice of Redemption. The Company shall provide notice of any
redemption of shares of Convertible Preferred Stock to holders of record of
Convert ible Preferred Stock to be called for redemption not less than 30 days
nor more than 60 days prior to the Redemption Date. Such notice (a "Redemption
Notice") shall, subject to paragraph (4)(e)(z), be provided in accordance with
paragraph (14); provided, however, that neither failure to give such notice nor
any defect therein shall affect the validity of the proceedings for the
redemption of any shares of Convertible Preferred Stock to be redeemed.
In addition to any information required by law, the Redemption
Notice shall state, as appropriate, the following (and may contain such other
informa tion as the Company deems advisable):
(A) the Redemption Date;
(B) the number of shares of Convertible Preferred Stock to be
redeemed and, if less than all the shares held by such holder
are to be redeemed, the number of shares to be redeemed from
such holder;
(C) the then applicable Redemption Price and the form or forms of
consideration that the Company has elected to pay and/or
deliver upon such redemption and, if more than one form of
consideration has been elected by the Company, the desig nated
portions of the Redemption Price to be paid in each form of
consideration so elected;
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(D) if the Company has elected to exchange and deliver shares of
Common Stock in payment of the Redemption Price (or a
designated portion thereof), the Company's computation of the
number of shares of Common Stock exchangeable and deliver able
as provided in paragraph (4)(e) below;
(E) the place or places in the United States or England and Wales
where certificates for Convertible Preferred Stock to be re
deemed are to be surrendered for redemption; and
(F) that dividends on the shares of Convertible Preferred Stock to
be redeemed shall cease to accrue on the Redemption Date
(unless the Company defaults in making payment of the Re
demption Price).
(e) Redemption by Delivery of Common Stock. If the Company elects to
pay, in whole or in part, the Redemption Price in respect of shares of
Convertible Preferred Stock in exchange for and through the delivery of shares
of Common Stock, then the Company shall deliver to each holder of shares of
Convert ible Preferred Stock to be redeemed on the Redemption Date a number of
shares of Common Stock equal to the aggregate Redemption Price or Mandatory
Redemption Price (or designated portion thereof) of such shares of Convertible
Preferred Stock divided by the Average Market Price. No fractional shares of
Common Stock shall be delivered to a holder of shares of Convertible Preferred
Stock in payment of the Redemption Price or Mandatory Redemption Price, but the
Company shall instead pay a cash adjustment determined as provided in paragraph
(9).
(f) Deposit of Funds and/or Shares. If on or before the Redemption
Date: (x) the Company shall have deposited with any bank or trust company
organized under the laws of the United States of America or any state thereof
having capital, undivided profits and surplus aggregating at least $250 million
(the "Re demption Agent"), cash (including cash for any adjustment in lieu of
delivering fractional shares) and/or shares of Common Stock, as applicable,
sufficient to pay in full the aggregate Redemption Price or Mandatory Redemption
Price (calculated through the Redemption Date) for such shares of Convertible
Preferred Stock on such Redemption Date, (y) such cash and/or shares of Common
Stock are readily available to, but only to, the holders of Convertible
Preferred Stock in satisfaction of the obligations of the Company with respect
to the payment of the Redemption Price or the Mandatory Redemption Price and (z)
the Company shall prior to the Redemp tion Date have so notified each record
holder of Convertible Preferred Stock, which
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notice shall be given to each holder of Convertible Preferred Stock by courier
and shall identify the Redemption Agent, its address and telephone and
telecopier numbers and the contact person(s) at the Redemption Agent responsible
for adminis tration of the deposit then, effective as of the close of business
on such Redemption Date (and notwithstanding that any certificate therefor shall
not have been surren dered for cancellation): (i) such shares of Convertible
Preferred Stock shall no longer be deemed outstanding but any shares of Common
Stock so deposited in accordance with this paragraph (e) for which such
Convertible Preferred Stock was redeemed shall be deemed to be outstanding; (ii)
the holders thereof shall cease to be holders of Convertible Preferred Stock but
shall be shown on the records of the Company as holders of the Common Stock so
deposited in accordance with this paragraph (e) in redemption of such
Convertible Preferred Stock; (iii) dividends with respect to the shares so
called for redemption shall cease to accrue on the Redemp tion Date but, subject
to paragraph (4)(f), such holders shall be entitled to any dividends which shall
thereafter accrue on, and shall be entitled to exercise all other rights
associated with, any shares of Common Stock so deposited in accordance with this
paragraph (e) in redemption of such Convertible Preferred Stock; and (iv) all
rights whatsoever with respect to the shares so called for redemption shall
forthwith cease and terminate (except the right of such holders, upon the
surrender of certifi cates evidencing the shares of Convertible Preferred Stock
so redeemed, to receive the cash and/or Common Stock, as applicable, payable or
deliverable in payment of the Redemption Price therefor, and the applicable cash
adjustment, if any, in lieu of fractional shares, without interest). Any cash
and/or shares of Common Stock so deposited or set apart which shall remain
unclaimed at the end of one year after the Redemption Date shall be returned or
released to the Company, after which time the holders of shares of Convertible
Preferred Stock called for redemption on such Redemption Date that remain
outstanding after such one-year period shall look only to the Company for the
payment of the Redemption Price for such shares, without interest.
A deposit made in compliance with the immediately preceding sentence
shall, except to the extent released or returned to the Company, be deemed to
constitute full payment for the shares of Convertible Preferred Stock to be
redeemed. Any interest accrued on funds so deposited shall be paid by the Redemp
tion Agent to the Company from time to time. If any shares of Convertible
Preferred Stock called for redemption on such Redemption Date are converted, in
accordance with paragraph (5), between the date such cash and/or shares of
Common Stock are so deposited with the Redemption Agent and the close of
Business on the Redemp tion Date, then the cash (including cash for any
adjustment in lieu of delivering fractional shares) and/or shares of Common
Stock, as applicable, so deposited for the
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redemption of such shares so covered shall be promptly thereafter returned by
the Redemption Agent to the Company.
(g) Surrender of Certificates; Status. Each holder of shares of
Convertible Preferred Stock to be redeemed shall not be entitled to receive
payment of the Redemption Price for such shares until such holder shall
surrender the certifi cates evidencing such shares duly endorsed by, or
accompanied by, an instrument of transfer (in form reasonably satisfactory to
the Company) duly executed by, the holder or such holder's duly authorized
attorney-in-fact or, if the shares issuable upon redemption are to be issued in
the same name as the name in which such share of the Convertible Preferred Stock
is registered, in blank to the Redemption Agent (or to the Company if there is
no Redemption Agent) at the place designated in the Re demption Notice for such
redemption and shall thereupon be entitled to receive the consideration for such
shares specified in the Redemption Notice in an aggregate amount equal to the
Redemption Price for such shares. Holders of shares of Convert ible Preferred
Stock that are redeemed on the Redemption Date shall not be entitled to receive
dividends declared and paid on any shares of Common Stock exchange able and
deliverable in payment of the Redemption Price (or designated portion thereof)
for such shares of Convertible Preferred Stock, and such shares of Common Stock
shall not be entitled to vote, until such shares of Common Stock are delivered
upon the surrender of the certificates representing such shares of Convertible
Preferred Stock. Upon such surrender, such holders shall be entitled to receive
such dividends declared and paid subsequent to such Redemption Date and prior to
the delivery.
(h) If any shares of Convertible Preferred Stock have been surren
dered for conversion into Common Stock pursuant to paragraph (5), then (i) the
Company shall not be obligated to redeem such shares and (ii) shares of Common
Stock and any funds which shall have been deposited for the payment of the Re
demption Price for such surrendered shares of Convertible Preferred Stock shall
be returned to the Company immediately after such conversion (subject to
declared dividends payable to holders of shares of Convertible Preferred Stock
on the record date for such dividends being so payable, to the extent set forth
in paragraph (5) hereof, regardless of whether such shares are converted
subsequent to such record date and prior to the related Dividend Payment Date).
(i) Priority. The right of the Company to redeem shares of Convert
ible Preferred Stock pursuant to this paragraph (4) shall be subject to the
prior preferences and other rights of any Senior Stock and to the provisions of
paragraph (7).
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(23) CONVERSION.
(a) Optional Conversion. A holder of one or more shares of the
Convertible Preferred Stock shall have the right, exercisable at any time and
from time to time after the Issue Date until the Redemption Date with respect to
the affected shares, at such holder's option, to convert any or all shares of
the Convert ible Preferred Stock into such number of shares of Common Stock as
is equal to the aggregate Stated Value of the shares of Convertible Preferred
Stock surrendered for conversion divided by the Denominator. In the case of
shares of Convertible Preferred Stock called for redemption, conversion rights
will expire at 5:00 p.m. New York City time on the Business Day prior to the
applicable Redemption Date and if not exercised prior to such time, such
conversion right will be lost, unless the Company defaults in making the payment
due upon redemption. Holders of record of shares of the Convertible Preferred
Stock at the close of business on a record date fixed for the payment of a
dividend on such shares shall be entitled to receive the dividend
notwithstanding the conversion of the shares prior to the dividend payment date.
In addition to the right to receive accrued dividends not in arrears as provided
for in paragraph (3)(a), if there is an arrearage of dividends in respect of any
of the shares of Convertible Preferred Stock surrendered for conversion, upon
such conver sion, the Company shall pay to the holder of the Convertible
Preferred Stock so surrendered such arrearage: (i) in cash out of funds legally
available therefor; (ii) through the delivery of shares of Common Stock; or
(iii) through any combination of the foregoing elected by the Board in its sole
discretion, in each case, subject to, and in accordance with, the provisions of
paragraph (3). If the Company elects, or is required by the proviso contained in
paragraph (3)(b), to pay any dividend arrearage on the Convertible Preferred
Stock, in whole or in part, in shares of Common Stock, each holder of the
Convertible Preferred Stock entitled to such dividend payment shall be issued
that number of shares of Common Stock equal to the aggregate amount of such
dividend arrearage to be paid through the delivery of shares of Common Stock
divided by the Average Market Price as of the Conversion Date (with a cash
payment in lieu of the issuance of fractional shares determined in accordance
with paragraph (9)). Except as provided above and in paragraph (3)(a), the
Company shall make no other payment of or allowance for unpaid dividends,
whether or not in arrears, on such Convertible Preferred Stock or for previously
declared dividends or distributions on the shares of Common Stock issued upon
such conversion. Each share surrendered for conversion shall, unless the shares
issuable on conversion are to be issued in the same name as the name in which
such share of the Convertible Preferred Stock is registered, be duly endorsed
by, or be accompa nied by an instrument of transfer (in form reasonably
satisfactory to the Company), duly executed by the holder or such holder's duly
authorized attorney-in-fact.
(b) Conversion Procedure. To exercise the conversion right, the
holder of each share of the Convertible Preferred Stock to be converted shall
surren der the certificate representing such share, duly endorsed or assigned to
the Company or in blank, at any office of any transfer agent for the Convertible
Preferred Stock in New York, New York previously appointed by the Company and
identified in a notice given to the holders of Convertible Preferred Stock in
accordance with paragraph (14), or, if no such transfer agent has been so
appointed and identified, at the office of the Company and (whether or not a
transfer agent has been so appointed and identified) shall give not less than 60
days prior notice to the Company in accordance with paragraph (14) that such
holder elects to convert the shares repre sented by such certificate or a
portion thereof. Such notice shall also state the name or names (with
address(es) in which the certificate or certificates for the shares of Common
Stock which shall be issuable upon such conversion shall be issued, and shall be
accompanied by funds in an amount sufficient to pay any transfer or similar tax
required by the provisions of paragraph (10). Each share surrendered for conver
sion shall, unless the shares issuable on conversion are to be issued in the
same name as the name in which such share of the Convertible Preferred Stock is
registered, be duly endorsed by, or be accompanied by an instrument of transfer
(in form reason ably satisfactory to the Company), duly executed by the holder
or such holder's duly authorized attorney-in-fact.
(c) Issuance of Common Stock. As promptly as practicable after the
surrender of certificates for shares of the Convertible Preferred Stock for
conversion, the giving of the notice and the delivery of the funds, if any,
referred to in paragraph (5)(b) above, the Company shall issue and shall deliver
to such holder, or on such holder's written order: (i) a certificate or
certificates for the number of whole shares of Common Stock issuable upon the
conversion of such shares of Convertible Preferred Stock in accordance with the
provisions of this paragraph (5); (ii) a check or cash in respect of any
fractional interest in respect of a share of Common Stock arising upon such
conversion, as provided in paragraph (9) below; and (iii) in respect of any part
of any share of Convertible Preferred Stock that is surrendered for conversion
in part, a new certificate for a share of Convertible Preferred Stock having a
Stated Value (rounded to the nearest whole cent) equal to the part of the share
surrendered that was not converted into shares of Common Stock. Each conversion
with respect to any shares of the Convertible Preferred Stock shall be deemed to
have been effected (irrespective of whether the Company shall have delivered
certificates representing the Common Stock) on the date on which the
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certificates for shares of the Convertible Preferred Stock shall have been
surrendered (accompanied by the funds, if any, required by paragraph (10)
below), such notice shall have been given and such instruments of transfer, if
any, shall have been delivered to the Company or the transfer agent as
aforesaid, and the person or persons entitled to receive the Common Stock
issuable upon such conversion shall be deemed for all purposes to be the record
holder or holders of such Common Stock upon that date at that time (the
"Conversion Date").
(d) No Fractional Shares of Common Stock. No fractional shares of
Common Stock or scrip representing fractional shares shall be issued upon conver
sion of Shares of the Convertible Preferred Stock. If more than one share of the
Convertible Preferred Stock shall be surrendered for conversion 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 of the Convertible Preferred Stock so surrendered. Instead of any
fractional share of Common Stock otherwise issuable upon conversion of any
shares of the Convertible Preferred Stock, the Company shall pay a cash amount
determined in accordance with paragraph (9) below in respect of such fraction.
(e) Reservation of Shares of Common Stock. The Company shall reserve
out of its authorized but unissued Common Stock or its Common Stock held in
treasury sufficient shares of Common Stock to permit the conversion of all of
the outstanding shares of the Convertible Preferred Stock. The Company shall at
no time permit the authorized but unissued amount of its Common Stock to be
insuffi cient to permit the conversion of all shares of the Convertible
Preferred Stock at the time outstanding. All shares of Common Stock delivered
upon conversion of the shares of the Convertible Preferred Stock will, upon
delivery, be duly authorized and validly issued, fully paid and nonassessable,
free from any adverse claims and preemptive rights with respect thereto.
(6) ADJUSTMENTS.
(a) Common Stock Dividends, Splits, Subdivisions and Combina tions.
The Fixed Price shall be subject to adjustment from time to time as follows:
(i) If, after the Issue Date, the Company shall (A) pay a dividend
or make a distribution on its outstanding Common Stock in shares of its Common
Stock, (B) split or subdivide its outstanding Common Stock into a greater number
of shares or (C) combine its outstanding Common Stock into a smaller number of
shares, then, in each case, the Fixed Price in effect immediately prior to such
action
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shall be adjusted concurrently with the occurrence of such event and without any
action on the part of the Company or any holder of Convertible Preferred Stock
to that price determined by multiplying the Fixed Price in effect immediately
prior to such event by a fraction:
(1) the numerator of which shall be the total number of shares of
Common Stock outstanding immediately prior to such time, and
(2) the denominator of which shall be the total number of shares
of Common Stock outstanding immediately after such time.
An adjustment made pursuant to this paragraph (i) shall become effective immedi
ately after the record date, in the case of a dividend or distribution (except
as provided in paragraph (6)(e) below), and shall become effective immediately
after the effective date in the case of a subdivision, split or combination.
(ii) If, after the Issue Date, the Company issues Options or Convert
ible Securities to substantially all holders of Common Stock entitling them (for
a period commencing no earlier than the record date for the determination of
holders of Common Stock entitled to receive such Options or Convertible
Securities and expiring not more than within 45 days after such record date) to
subscribe for, purchase, otherwise acquire or convert into shares of Common
Stock at a price per share less than the Current Market Price per share of such
shares of Common Stock on such record date, then the Fixed Price in effect
immediately prior to the Computa tion Date shall be adjusted on the Computation
Date (without any action on the part of the Company or any holder of Convertible
Preferred Stock) so that the same shall equal the price determined by
multiplying the Fixed Price in effect immediately prior the such Computation
Price by a fraction:
(1) the numerator of which shall be the number of shares of Com
mon Stock outstanding immediately prior to the Computation
Date plus the number of shares of Common Stock which the
aggregate offering price of the total number of shares of Com
mon Stock issuable pursuant to such Options or pursuant to the
terms of such Convertible Securities would purchase at the
then Current Market Price on such Computation Date, and
(2) the denominator of which shall be the number of shares of
Common Stock outstanding on such Computation Date plus
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the maximum number of additional shares of Common Stock
issuable pursuant to all such Options or necessary to effect
the conversion or exchange of all such Convertible Securities.
To the extent of the expiration unexercised of the right of conversion or
exchange of any Convertible Securities, or to the extent of the expiration,
unexercised, of any Options, or upon any increase in the minimum consideration
receivable by the Company for the issuance of additional shares of Common Stock
pursuant to such Convertible Securities or Options, in either case previously
adjusted as aforesaid, then the number of shares of Common Stock deemed to be
issued and outstanding by reason of the fact that they were issuable upon
conversion or exchange of any such Convertible Securities or upon exercise of
any such Options shall no longer be computed as set forth above, and the Fixed
Price shall forthwith be readjusted and thereafter be the price which it would
have been (but reflecting any other adjustments in the Fixed Price made pursuant
to the provisions of this paragraph (6)(a) after the Issue Date) had the
adjustment of the Fixed Price made upon the issuance or sale of such Convertible
Securities or the issuance of such Options not been made or made upon the basis
of such increased minimum consideration, as the case may be. Such adjustment
shall be made successively wherever any such Options or Convertible Securities
are issued at a price below the Current Market Price therefor as in effect on
the date of issuance. In determining whether any Options or Convertible Securi
ties entitle the holders to subscribe for or purchase shares of Common Stock at
less than the Current Market Price therefor, and in determining the aggregate
offering price of shares of Common Stock, there shall be taken into account any
consideration received by the Company for such Options or Convertible
Securities, the value of such consideration, if other than cash, to be
determined in good faith by the Board. Notwithstanding the foregoing, if the
Options or Convertible Securities are exercis able, convertible or exchangeable
only upon the occurrence of certain triggering events or the arrival of a
specified date, then the Fixed Price will not be adjusted until such triggering
events or specified dates occur.
(iii) If, after the Issue Date, the Company shall distribute, by way
of dividend or otherwise, to all holders of Common Stock shares of any class of
stock other than Common Stock, evidences of indebtedness or other assets (other
than cash dividends out of current or retained earnings), or shall distribute to
substantially all holders of Common Stock, Options (other than those referred to
in paragraph (6)(a)(ii) above, then, in each such case, the Fixed Price shall be
adjusted on the record date (without any action on the part of the Company or
any holder of Convert ible Preferred Stock) so that the same shall equal the
price determined by multiplying
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the Fixed Price in effect immediately prior to the date of such distribution by
a fraction:
(1) the numerator of which shall be the Current Market Price of
the Common Stock on the record date mentioned below less the
then fair market value (as reasonably determined in good faith
by the Board) of the portion of the assets so distributed or
of such subscription Options applicable to one share of Com
mon Stock, and
(2) the denominator of which shall be such Current Market Price of
the Common Stock. Such adjustment shall become effec tive
immediately after the record date for the determination of the
holders of Common Stock entitled to receive such distribu
tion.
In addition to the foregoing, if, upon the occurrence of the Distribution
Date (as defined in the Rights Agreement), the Company shall distribute the
Rights: (x) the record holders of Convertible Preferred Stock on the
Distribution Date (as so defined) shall be deemed to have been holders of Common
Stock issued on or after the Merger (as defined in the Rights Agreement) and
prior to the Distribution Date (as so defined) for purposes of the Rights
Agreement; and (y) the Company shall make lawful and proper provisions so that
each such record holder shall receive, in addition to the shares of Common Stock
which may then be issuable upon conver sion pursuant to the provisions of this
Certificate, the same number of Rights to which a holder of the number of shares
of Common Stock into which the shares of Convertible Preferred Stock held by
such record holder was convertible immediately prior to the Distribution Date
(as so defined) would have been entitled on such Distribution Date pursuant to
the Rights Agreement if all the shares of Convertible Preferred Stock held by
such record holder had been converted pursuant to the provisions of paragraph
(5)(a).
(iv) Without prejudice to paragraph (7)(a) of this Certificate, if
after the Issue Date, the Company shall, by dividend or otherwise, at any time
distribute to all holders of its Common Stock cash (including any distributions
of cash out of current or retained earnings of the Company but excluding any
cash that is distrib uted as part of a distribution requiring an adjustment
pursuant to paragraph (iii) of this paragraph) in an aggregate amount that,
together with the aggregate amount of any other distributions to all holders of
its Common Stock made in cash within the 12 months preceding the date fixed for
determining the stockholders entitled to such
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distribution (the "Distribution Record Date") and in respect of which no
adjustment pursuant to paragraph (iii) of this paragraph (6) or this paragraph
(iv) has made, exceeds 10% of the product of (A) the Current Market Price per
share of the Com mon stock on the Distribution Record Date times (B) the number
of shares of Common Stock outstanding on the Distribution Record Date (excluding
shares held in the treasury of the Company), the Fixed Price shall be reduced on
the Distribution Record Date (without any action on the part of the Company or
any holder of Convertible Preferred Stock) so that the same shall equal the
price determined by multiplying such Fixed Price in effect immediately prior to
the effectiveness of the Fixed Price reduction contemplated by this paragraph
(iv) by a fraction:
(1) the numerator of which shall be the Current Market Price per
share of the Common Stock on the Distribution Record Date less
the amount of such cash and other consideration so dis
tributed applicable to one share (based on the pro rata
portion of the aggregate amount of such cash and other
consideration, divided by the shares of Common Stock
outstanding on the Distribution Record Date) of Common Stock;
and
(2) the denominator of which shall be such Current Market Price
per share of the Common Stock on the Distribution Record Date,
such reduction to become effective immediately prior to the
opening of business on the day following the Distribution
Record Date.
Such adjustment shall become effective immediately after the record date for the
determination of stockholders entitled to receive such distribution, except as
pro vided in paragraph (6)(e) below. Such adjustment shall be made successively
whenever any such dividend or distribution shall be made.
(v) All calculations under this paragraph (6)(a) shall be made to
the nearest cent or nearest 1/1000th of a share of Common Stock.
(vi) Notwithstanding anything to the contrary set forth in this
paragraph (6), no adjustment shall be made to the Fixed Price (A) upon the
issuance or distribution of Options or Convertible Securities (or upon the
exercise of such Options or the conversion of such Convertible Securities)
pursuant to any stock option, restricted stock or other incentive or benefit
plan or stock ownership or purchase plan for the benefit of employees, directors
or officers of the Company and its subsidiaries or any dividend reinvestment
plan of the Company in effect or
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adopted on or before the Issue Date or approved by the stockholders or
compensation committee of the Company after the Issue Date or (B) upon the
deemed issuance of Common Stock (provided, that such issuance does not involve
an actual issuance of Common Stock) by reason of adjustments required pursuant
to anti-dilution provi sions applicable to securities of the Company as in
effect on the Issue Date.
(vii) The Company shall also be entitled to make such deductions, in
addition to those required by paragraph (6)(a)(i), (ii) and (iii), to the Fixed
Price as it considers to be advisable in order to avoid or diminish any tax to
holders of Common Stock, Options or Convertible Securities resulting from any
stock dividends, subdivi sions of shares, distributions of Options or
Convertible Securities (or any transac tions which would be treated as any of
the foregoing transactions pursuant to Section 305 of the Internal Revenue Code
of 1986, as amended) made by the Company. In addition, the Company from time to
time may decrease the Fixed Price by any amount for any period of time if the
period is at least 20 days and if the decrease is irrevocable during the period.
Whenever the Fixed Price is so decreased, the Company shall give holders of
record of shares of Convertible Preferred Stock a notice of the decrease in
accordance with paragraph (14) at least 15 days before the date the decreased
Fixed Price takes effect, and such notice shall state the decreased Fixed Price
and the period it will be in effect. A voluntary adjustment of the Fixed Price
shall not change or adjust the Fixed Price otherwise in effect for purposes of
this paragraph (6).
(viii) If, at any time as a result of an adjustment made pursuant to
paragraph (6)(a)(i), (ii) or (iii), the holder of any share of the Convertible
Preferred Stock thereafter surrendered for conversion or redemption shall become
entitled to receive any securities of the Company other than shares of the
Common Stock, thereafter the number of such other securities so receivable upon
conversion of any share of the Convertible Preferred Stock shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Common Stock contained in
paragraphs (6)(a)(i) through (6)(a)(vii) above, and the other provisions of this
paragraph (6)(a)(viii) with respect to the Common Stock shall apply on like
terms to any such other shares.
(b) (i) Reorganizations. If there is to occur any Reorganization,
and there is determinable for the entirety of each Reorganization Unit to be
issued in connection with such Reorganization on an Applicable Price, then as a
condition precedent to such Reorganization proper provision shall be made such
that each share of Convertible Preferred Stock, or each share of convertible
preferred stock of the Company or its successor by merger or consolidation
issuable to each holder of
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Convertible Preferred Stock in exchange or substitution therefor (provided that
such share of convertible preferred stock has the same Stated Value and, subject
to the proviso in paragraph (6)(b)(ii), substantially the same rights, benefits
and privileges as a share of Convertible Preferred Stock), shall be convertible
or redeemable upon and from and after the occurrence of such Reorganization
into, in lieu of Common Stock as provided herein (and without prejudice to the
right of the Company or its successor to redeem convertible preferred stock for
cash in accordance herewith), a number of Reorganization Units determined by
dividing the Stated Value of such share by the higher of (x) the Fixed Price on
the Conversion Date and (y) the Applicable Price of a Reorganization Unit on the
Conversion Date.
If there is to occur any Reorganization, and any Reorganization Unit to be
issued in connection with such Reorganization does not have in whole or in part
a determina ble Applicable Price, then prior to the occurrence of such
Reorganization and on a basis such that the holders of Convertible Preferred
Stock shall be holders of Common Stock for all purposes of such Reorganization,
the Company will redeem all Convertible Preferred Stock in accordance herewith.
The Company shall not effect any Reorganization unless prior to or
simultaneously with the consummation thereof, the successor entity resulting
from such consolidation or merger or the entity purchasing such assets or
compelling such exchange, as the case may be, shall make provisions in its
certificate or articles of incorporation or other constituent document to
establish such right. The provisions of this paragraph (6)(b) shall similarly
apply to successive Reorganizations.
(ii) Holding Company. Notwithstanding anything herein to the
contrary, if the Company is reorganized such that the Common Stock is exchanged
for the common stock of a new entity ("Holdco") whose common stock is traded on
NASDAQ or another recognized securities exchange, then the Company, by notice to
the holders of the Convertible Preferred Stock but without any required consent
on their part, may cause the exchange of this Convertible Preferred Stock for
convertible preferred stock of Holdco having the same terms and conditions as
set forth herein, provided that where Holdco is not a Delaware company or where
the Holdco share structure is not identical to that of the Company, the rights
attaching to the mandatorily redeemable preferred stock of Holdco may be
adjusted so as to comply with the local law of the country of incorporation of
Holdco or the new share structure of Holdco subject to such rights effectively
giving the same economic rights as the Mandatorily Redeemable Preferred Stock
(ignoring for these purposes any resultant change in the tax treatment for the
holders of such stock).
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(iii) Other Adjustments. In the event that, as a result of an
adjustment made pursuant to paragraphs (6)(a) or (b), the holder of any
Convertible Preferred Stock thereafter surrendered for conversion or redemption
shall become entitled to receive any shares of capital stock of the Company
other than shares of its Common Stock, thereafter the number of such shares
issuable upon conversion or redemption of such security shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to Common Stock contained in such
paragraphs this Article V.
(c) Notices of Corporate Action. If:
(i) the Company shall take any action which would require an
adjustment of the Fixed Price pursuant to paragraph (6)(a); or
(ii) the Company or the Board shall approve any Reorganization to
which the Company is a party and for which approval of any Stockholders of the
Company is required; or
(iii) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in each case, the Company shall cause to be filed with the transfer agent
for the Convertible Preferred Stock, if any, and shall cause to be given to the
holders of shares of the Convertible Preferred Stock in accordance with
paragraph (15), as promptly as possible, but at least 10 days prior to the
applicable date hereinafter specified, a notice stating (A) the date on which a
record is to be taken for the purposes of such dividend or distribution, 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 or distribution are to be determined or
(B) the date on which the event giving rise to an adjustment of the type
described in paragraph (6)(a), such a Reorganization, dissolu tion, liquidation
or winding up may occur, as the case may be, is expected to become effective or
occur, and, if earlier, 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 stock of the Company, securities, cash or other property deliverable
upon such Reorganization, dissolution, liquidation or winding up. Failure to
give or receive such notice or any defect therein shall not affect the legality
or validity of the action or transactions described in sub-paragraphs (i)
through (iii) above.
(d) Notice of Adjustments. Whenever any adjustment is required by
the terms of paragraph (6)(a), the Company shall promptly cause a notice of such
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adjustment and a computation thereof to be mailed to each registered holder of
shares of the Convertible Preferred Stock.
(e) Deferral of Issuance and Payment. In any case in which para
graph (6) shall require an adjustment be made immediately following a record
date, the Company may elect to defer (but only 5 Business Days following the
mailing of the notice referred to in paragraph (6)(d)) issuing to the holder of
any shares of the Convertible Preferred Stock converted after such record date
the additional shares of Common Stock and other capital stock of the Company
issuable upon such conver sion over and above the Common Stock and other capital
stock of the Company issuable upon such conversion only on the basis of the
conversion rate prior to adjustment; provided, however, that in lieu of the
shares the issuance of which is so deferred, the Company shall issue or cause
its transfer agent to issue due bills or other appropriate evidence of the right
to receive such shares and (ii) paying to such holder any amount in cash in lieu
of any fraction pursuant to paragraphs (5)(d) and (9) hereof.
(f) Listing of Common Stock. The Company will list the shares of
Common Stock required to be delivered as any dividend payment or as payment upon
redemption or conversion of shares of the Convertible Preferred Stock, prior to
delivery, upon each national securities exchange, the Nasdaq Stock Market's Na
tional Market or any similar system of automated dissemination of securities
prices, if any, upon which the Common Stock is listed at the time of delivery.
(g) Provision of Information. So long as any shares of Convertible
Preferred Stock remain outstanding, the Company undertakes to provide without
charge to each record holder of such shares copies of each: (i) annual report of
the Company on Form 10-K filed pursuant to Section 13(a) of the Exchange Act
concurrently with such filing; (ii) quarterly reports of the Company on Form
10-Q and current report of the Company on Form 8-K filed pursuant to Section
13(a) or 15(d) or the Exchange Act concurrently with such filing; (iii)
definitive proxy or information statement, form of proxy or other material of
the Company filed pursu ant to Section 14(a) of the Exchange Act concurrently
with such filing; and (iv) notice, press release and other information delivered
to holders of Common Stock generally concurrently with such delivery.
(7) LIMITATIONS ON DIVIDENDS AND REDEMPTIONS IN
RESPECT OF COMPANY STOCK.
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(a) Limitations on Junior Stock Dividends. As long as any shares
Convertible Preferred Stock are outstanding, no dividends shall be paid or
declared in cash on Junior Stock, nor shall any other distributions be made on
any Junior Stock, unless: (i) full dividends on all Parity Stock have been paid,
or declared and set aside for payment, for all dividend periods terminating on
or prior to the date of such Junior Stock dividend or distribution payment, to
the extent such dividends are cumulative and have fallen due; (ii) the Company
has paid or set aside all amounts, if any, then or therefore required to be paid
or set aside for all purchase, retirement, and sinking funds, if any, for any
Parity Stock; and (iii) the Company is not in default on any of its obligations
to redeem any Parity Stock.
(b) Limitations on Purchase of Junior Stock. As long as any shares
of Convertible Preferred Stock are outstanding, no shares of any Junior Stock
may be purchased, redeemed, or otherwise acquired by the Company or any of its
Subsidiar ies (except in connection with a reclassification of any Junior Stock
through the issuance of other Junior Stock and/or Convertible Securities for
shares of Junior Stock and cash in lieu of fractional shares in connection
therewith or the purchase, redemption or other acquisition of any Junior Stock
from any wholly-owned subsid iary), nor may any funds be set aside or made
available for any sinking fund for the purchase, redemption or other acquisition
of any Junior Stock, unless: (i) full dividends on all Parity Stock have been
paid, or declared and set aside for payment, for all dividend periods
terminating on or prior to the date of such purchase, redemp tion or
acquisition, to the extent such dividends are cumulative and have fallen due;
(ii) the Company has paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchases retirement, and sinking
funds, if any, for any Parity Stock; and (iii) the Company is not in default on
any of its obligations to redeem any Parity Stock.
(c) Junior Stock Dividends Otherwise Permitted. Subject to the
provisions of paragraphs (7)(a) and 8(b), dividends or distributions (payable in
cash, property or securities) may be declared and paid on the shares of any
Junior Stock from time to time and any Junior Stock may be purchased, redeemed
or otherwise acquired by the Company or any of its subsidiaries from time to
time. In the event of the declaration and payment of any such dividends or
distributions, the holders of such Junior Stock will be entitled, to the
exclusion of holders of shares of Convert ible Preferred Stock, to share therein
according to their respective interests.
(d) Limitations on Parity Stock Dividends and Redemptions. As long
as any shares of Convertible Preferred Stock are outstanding, dividends or other
distributions may not be declared or paid on any Parity Stock, and the Company
may
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not purchase, redeem or otherwise acquire any Parity Stock (except (x) from any
wholly owned subsidiaries of the Company or (y) in connection with a mandatory
conversion or exchange of such Parity Stock or a conversion or exchange of such
Parity Stock at the option of the holder for securities other than Parity Stock
or Senior Stock and cash in lieu of fractional shares in connection therewith)
unless either:
(a)(i) full dividends on all Parity Stock have been paid, or
declared and set aside for payment, for all dividend periods terminating
on or prior to the date of such Parity Stock dividend, distribution,
purchase, re demption or other acquisition payment, to the extent such
dividends are cumulative and have fallen due;
(ii)the Company has paid or set aside all amounts, if any, then
or theretofore required to be paid or act aside for all purchase,
retirement, and sinking funds, if any, for any, Parity Stock; and
(iii)the Company is not in default on any of its obligations to
redeem any Parity Stock, or
(b) with respect to the payment of dividends only, any such
dividends are declared and paid pro rata so that the amounts of any
dividends declared and paid per share on shares of Convertible Preferred
Stock and each other share of such Parity Stock will in all cases bear to
each other the same ratio that accrued and unpaid dividends (including any
accumulation with respect to unpaid dividends for prior dividend periods,
if such dividends are cumula tive) per share on shares of Convertible
Preferred Stock and such other share of Parity Stock bear to each other.
(e) Certain Permitted Dividends and Redemptions. Nothing contained
in this paragraph (7) shall prevent: (i) the payment of dividends or the making
of distributions on any Junior Stock solely in shares of Junior Stock and/or
Convertible Securities for shares of Junior Stock (together with a cash
adjustment for fractional shares, if any) or the redemption, purchase or other
acquisition of Junior Stock solely in exchange for (together with a cash
adjustment for fractional shares, if any), or through the application of the
proceeds from the sale of, shares of Junior Stock and/or Convertible Securities
for shares of Junior Stock; (ii) the payment of dividends or the making of
distributions on any class or series of Parity Stock solely in (together with a
cash adjustment for fractional shares, if any) shares of Junior Stock and/or
Convertible Securities for shares of Junior Stock or the redemption,
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exchange, purchase or other acquisition of say class or series of Parity Stock
solely in exchange for (together with a cash adjustment for fractional shares,
if any), or through the application of the proceeds from the sale of shares of
Junior Stock and/or Convertible Securities for shares of Junior Stock or (iii)
the conversion or exchange of Convertible Preferred Stock into shares of Common
Stock (together with a cash adjustment for fractional shares, if any) and other
securities, assets or property, if any pursuant to the provisions of paragraphs
(4), (5) or (6).
(f) Waiver. The provisions of paragraphs (7)(a), (b) and (d) are for
the sole benefit of the holders of Convertible Preferred Stock and any other
class or series of Parity Stock having the terms described therein and
accordingly, at any time when (i) there are no shares of any such other class or
series of Parity Stock outstand ing or if the holders of each such other class
or series of Parity Stock have, by such vote or consent of the holders thereof
as may be provided for in the instrument creating or evidencing such class or
series, waived in whole or in part the benefit of such provisions (either
generally or in the specific instance), and (ii) the holders of shares of
Convertible Preferred Stock shall have waived (as provided in paragraph (15)) in
whole or in part the benefit of such provision (either generally or in the
specific instance), then the provisions of paragraphs (7)(a), (b) and (d) shall
not (to the extent waived, in the case of any partial waiver) restrict the
payment of dividends or the making of distributions on, or the redemption,
purchase or other acquisition of any shares of, Convertible Preferred Stock, any
other class or series of Parity Steel or any Junior Stock.
(8) LIQUIDATION RIGHTS.
(a) Payment of Liquidation Preference. If there is any liquidation,
dissolution, or winding up of the Company, whether voluntary or involuntary,
then the holders of shares of Convertible Preferred Stock then outstanding,
after payment, or provision for payment of the debts and other liabilities of
the Company and the payment or provision for payment of any distribution on any
shares of Senior Stock, and before any distribution to the holders of Junior
Stock, shall be entitled to be paid out of the assets of the Company available
for distribution to its stockholders an amount per share of Convertible
Preferred Stock in cash equal to the Liquidation Preference. If the assets of
the Company available for distribution to the holders of the shares of
Convertible Preferred Stock upon any dissolution, liquidation or winding up of
the Company shall be insufficient to pay in full the Liquidation Preference
payable to the holders of outstanding shares of Convertible Preferred Stock and
the liquidation preference payable to all other shares of Parity Stock (as set
forth in the instrument or instruments creating such Parity Stock), then the
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holders of shares of Convertible Preferred Stock and of all other shares of
Parity Stock shall share ratably in such distribution of assets in proportion to
the amount which would be payable on such distribution if the amounts to which
the holders of outstanding shares of Convertible Preferred Stock and the holders
of outstanding shares of such other Parity Stock were paid in full. Except as
provided in this paragraph (9)(a) holders is of Convertible Preferred Stock
shall not be entitled to any distribution in the event of the liquidation,
dissolution or winding up of the affairs of the Company.
(b) Certain Events Not Deemed Liquidation, Etc. For the purposes of
this paragraph (8) a Reorganization shall not be deemed to be a voluntary of
involuntary liquidation, dissolution or winding up of the Company.
(9) NO FRACTIONAL SHARES. No fractional shares of Common Stock or
Convertible Preferred Stock or scrip shall be issued in connection with the
delivery of shares of Common Stock or Convertible Preferred Stock upon
conversion of shares of Convertible Preferred Stock or in payment, in whole or
in part, of any dividend, Redemption Price or Liquidating Payment. Whether or
not a fractional share would be delivered to a holder of Convertible Preferred
Stock shall be based upon, in the case of the payment, in whole or in part, of
dividends, a Redemption Price of a Liquidating Payment pursuant to paragraphs
(3), (4) or (8) , respectively, and, in the case of conversion pursuant to
paragraph (5), through the delivery of shares of Common Stock or Convertible
Preferred Stock, on the total number of shares of Convertible Preferred Stock at
the time held by such holder and the total number of shares of Common Stock or
Convertible Preferred Stock, otherwise deliverable in respect thereof. Instead
of the issuance of a fraction of a share of Common Stock or Convertible
Preferred Stock or scrip, the Company shall pay instead an amount in cash
(rounded to the nearest whole cent) equal to, in the case of Common Stock, the
same fraction of the Closing Price of a share of preceding the Determination
Date.
(10) PAYMENT OF TAXES.
The Company shall pay any and all documentary, stamp or similar
transfer taxes payable in respect of the delivery of shares of Common Stock and
Convertible Preferred Stock, pursuant to paragraphs (3), (4), (5), or (8), as
applica ble; provided, however, the Company shall not be required to pay any
such tax that may be payable because any such shares are issued in a name other
than the name of the holder of such Convertible Preferred Stock.
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(11) NO PREEMPTIVE RIGHTS. The holders of shares of Convert ible
Preferred Stock shall have no preemptive rights, including preemptive rights
with respect to any shares of capital stock or other securities of the Company
convertible into or carrying rights or options to purchase any such shares.
(12) VOTING RIGHTS. (a) The holders of shares of Convertible
Preferred Stock shall have no Voting rights, except as otherwise required by law
and except as set forth in this paragraph (12). When and if the holders of
Convertible Preferred Stock are entitled to vote by law or pursuant to this
paragraph (12), each holder will be entitled to one vote per share.
(b) Dividend Non-Payment. In the event that the Company shall have
failed to pay dividends on the Convertible Preferred Stock for three semi-annual
periods (whether or not consecutive) (such failure, a "Dividend Non-Pay ment"),
the number of directors constituting the Board, without further action, shall be
increased by two and the holders of the majority of the then outstanding shares
of Convertible Preferred Stock shall have the right, voting separately as a
class, to elect such two additional members of the Board, at any annual meeting
of stockholders of the Company or by written consent pursuant to Section 228 of
the DGCL, in each case, who shall continue to serve so long as such dividends on
the Convertible Preferred Stock have not been paid. If and when all such accrued
and unpaid dividends on the Convertible Preferred Stock have been paid or
declared and set apart for payment, the holders of shares of Convertible
Preferred Stock shall be divested of the special voting rights provided for by
this paragraph (12), subject to revesting in the event of every subsequent
Dividend Non-Payment. Upon termina tion of such special voting rights, the term
of office of each director elected pursuant to this paragraph (12) by the
holders of shares of Convertible Preferred Stock (a "Preferred Stock Director")
shall terminate immediately and the number of directors constituting the Board
shall, without further action, be reduced by two, subject always to the increase
of the number of directors pursuant to this paragraph (12) in the case of the
future right of the holders of Convertible Preferred Stock to elect Preferred
Stock Directors. Any Preferred Stock Director may be removed by, and shall not
be removed otherwise than by, the vote of the holders of record of a majority of
the outstanding shares of the Convertible Preferred Stock entitled to vote
thereon present at a meeting called for such purpose at which a quorum is
present or by written consent pursuant to Section 228 of the DGCL. So long as a
Dividend Non-Payment shall continue, any vacancy in the office of a Preferred
Stock Director may be filled by vote of the holders of record of a majority of
the outstanding shares of Convertible Preferred Stock entitled to vote thereon
present at a meeting called for such purpose at which a quorum is present or by
written consent pursuant to Section
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228 of the DGCL. As long as a Dividend Non-Payment shall continue, holders of
shares of Convertible Preferred Stock shall not, as such stockholders, be
entitled to vote on the election or removal of directors other than Preferred
Stock Directors, but shall not be divested of any other voting rights provided
to such stockholders by law or this Certificate of Designations with respect to
any other matter to be acted upon by the stockholders of the Company.
At any meeting held for the purpose of electing directors at which
the holders of outstanding shares of Convertible Preferred Stock shall have the
right to elect directors as provided in this paragraph (12), the presence, in
person or by proxy, of the holders of at least a majority of the then
outstanding shares of Convertible Preferred Stock on which like voting rights
have been conferred and are exercisable shall be required and be sufficient to
constitute a quorum of such class for the election of directors by such class.
At any such meeting or adjournment thereof (i) the absence of a quorum of the
holders of the Convertible Preferred Stock present in person or by proxy shall
not prevent the election of directors other than those to be elected by the
holders of the Convertible Preferred Stock, and the absence of a quorum or
quorums of the holders of any class or classes of any stock or other securities
of the Company other than the Convertible Preferred Stock shall not prevent the
election of directors to be elected by the holders of the Convertible Preferred
Stock and (ii) in the absence of a quorum of the holders of any class of stock
entitled to vote for the election of directors, a majority of the holders
present in person or by proxy of such class shall have the power to adjourn the
meeting for the election of directors which the holders of such class are
entitled to elect, from time to time, without notice (except as required by law)
other than announcement at the meeting, until a quorum shall be present.
(c) Certain Changes to Charter. For as long as any shares of Con
vertible Preferred Stock remain outstanding, the affirmative vote of the holders
of at least a majority of such outstanding shares (voting separately as a class)
given in Person or by proxy at an annual meeting or a special meeting called for
such pur pose, shall be necessary (i) before the Company may amend any of the
provisions of this Certificate of Designations or the Restated Certificate of
Incorporation of the Company which would alter or change the powers, preferences
or special rights of the holders of the shares of Convertible Preferred Stock
then outstanding so as to affect them adversely; provided, however, that:
(x) any such amendment that would authorize, create or increase the
authorized amount of any additional shares of Junior Stock or
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shares of any other class or series of Parity Stock (whether or not
already authorized); and
(y) any such amendment that would increase the number of authorized
shares of Preferred Stock of the Company (but not the number of
authorized shares of Convertible Preferred Stock) or that would
decrease (but not below the number of shares, then outstand ing) the
number of authorized shares of Preferred Stock (but not the number
of authorized shares of Convertible Preferred Stock);
shall be deemed not to adversely affect such powers preferences or rights and
shall not be subject to approval by the holders of shares of Convertible
Preferred Stock; and (ii) before the Company may reclassify the outstanding
shares of Convertible Preferred Stock into another class or series of capital
stock of the Company; provided further, however, that no consent described in
clause (i) of this paragraph of the holders of the shares of Convertible
Preferred Stock shall be required if, at or prior to the time when such
amendment is to take effect, provision is made for the redemp tion of all shares
of Convertible Preferred Stock at the time outstanding.
(d) Creation of Senior Stock. No consent or vote of the holders of
the shares of Convertible Preferred Stock shall be necessary before the Company
or the Board may authorize, create or issue any class or series of Senior Stock.
(e) No Other Vote. Except as otherwise set forth in this paragraph
(12) or as required by law, the holders of Convertible Preferred Stock shall not
have any relative, participating, optional or other special voting rights and
powers and the consent or vote of such holders shall not be required for the
taking of any corporate action by the Company or the Board. The provisions of
this paragraph (12) are in lieu of, and not in addition to, any voting rights
specified in the Restated Certificate of Incorporation as applicable to a series
of Preferred Stock.
(13) PAYMENTS.
Payment of cash amounts due in respect of the Convertible Preferred
Stock will be paid to the holders of shares of Convertible Preferred Stock (or,
in the case of joint holders, the first-named) as appearing in the stock
register of the Company for the Convertible Preferred Stock as at opening of
business (New York time) on the date specified in this Certificate for the
purpose of determining the holders of Convertible Preferred Stock entitled to
such payments or, it no such date
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is specified, the fifteenth Business Day before the due date for such payment
(the "Payment Record Date").
Payments of cash amounts due in respect of the Convertible
Preferred Stock will be made by a check in U.S. dollars drawn on a bank in New
York and mailed to the address (as recorded is the stock register of the Company
for the Convertible Preferred Stock) of the holder thereof (or, in the case of
joint holders, the first-named) not later than the relevant date for payment
unless, prior to the relevant Payment Record Date, the Company has received from
the holder thereof (or, in the case of joint holders, the first-named) written
instructions for payment to be made by wire transfer to a specified designated
account. If the due date for payment of any cash amount in respect of the
Convertible Preferred Stock is not a Business Day, then the holder thereof will
not be entitled to payment thereof until the next following day which is a
Business Day and, if such payment is to be made by transfer to a desig nated
account rather than by check, a day on which commercial banks and foreign
exchange markets settle, payments in U.S. dollars in the place where the
relevant designated account is located.
(14) NOTICES.
Any notice or communication by a holder of Convertible Preferred
Stock to the Company is duly given if in writing and delivered in person or
mailed by first-class mail to the Company at its address as set forth in its
then most recently filed Form 10-K or 10-Q as the case may be.
Any notice or communications to a holder of Convertible Preferred
Stock shall be mailed by first-class mail to his address shown on the stock
register of the Company for the Convertible Preferred Stock or, if there are
more than 20 holders of record of the Convertible Preferred Stock and the
Company in its sole discretion so elects, in a leading daily newspaper having
general circulation in New York (which is expected to be the Wall Street
Journal) or England and Wales (which is expected to be The Financial Times).
Failure to mail a notice or communication to one holder or any defect in it
shall not affect its sufficiency with respect to other holders.
If a notice or communication is given in the manner provided in this
paragraph (14) within the time prescribed by this Certificate, it shall be
conclusively presumed to have been duly given, whether or not the person
entitled to such notice receives it.
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(15) WAIVER.
Any provision of this Certificate of Designations which, for the
benefit of the holders of Convertible Preferred Stock, prohibits, limits or
restricts actions by the Company may be waived in whole or in part, or the
application of all or any part of such provision in any particular circumstance
or generally may be waived, in each case with the consent of the holders of at
least a majority of the number of shares of Convertible Preferred Stock then
outstanding, either in writing or by vote at a meeting called for such purpose
at which the holders of Convertible Preferred Stock shall vote as a separate
class.
(16) REGISTRATION, TRANSFER AND EXCHANGES. (a) The
Company will keep with , the registrar and transfer agent, a register in which
the Company will provide for the registration and transfer of shares of
Convertible Preferred Stock. Any holder of shares of Convertible Preferred Stock
may, at its option, in person or by duly authorized attorney, surrender the
certificate representing the same for exchange at (duly endorsed or accompanied,
if so required by the Company, by a written instrument of transfer duly executed
by such holder or his or her duly authorized attorney), and, within a reasonable
time thereafter and without expense (other than transfer taxes, if any), receive
in exchange therefor one or more duly executed certificate or certificates dated
as of the date to which dividends have been paid on the shares of Convertible
Preferred Stock so surrendered, or if no dividend has yet been so paid, then
dated the date hereof, and registered in such name or names, all as may be
designated by such holder, for the same aggregate number of shares of
Convertible Preferred Stock as represented by the certificate or certificates so
surrendered. The Company covenants and agrees to take and cause to be taken all
action reasonably necessary to effect such registrations, transfers and
exchanges. Each share of Convertible Preferred Stock issued in exchange for any
share shall carry the same rights to unpaid dividends and redemption payments
which were carried by the share so exchanged, so that neither gain nor loss of
any such right shall result from any such transfer or exchange.
(b) The Company and any agent of the Company may treat the person in
whose name any share of Convertible Preferred Stock is registered as the owner
of such share for the purpose of receiving payment of dividends, and amounts
payable on redemption and liquidation in respect of such share and for all other
purposes.
(c) The holders of Convertible Preferred Stock are entitled to
certain rights under the Registration Rights Agreement. The certificates
representing shares
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of Convertible Preferred Stock will bear a legend indicating that they have been
issued in a transaction exempt from the Securities Act and may only be
transferred in accordance therewith or pursuant to an exemption therefrom.
(17) EXCLUSION OF OTHER RIGHTS.
Except as may otherwise be required by law, the shares of
Convertible Preferred Stock shall not have any designations, preferences,
limitations or relative rights other than those specifically set forth in this
Certificate of Designations other than the rights set forth in the Registration
Rights Agreement, the terms of which are incorporated herein by reference.
(18) SEVERABILITY OF PROVISIONS. Whenever possible, each provision
of this Certificate of Designations shall be interpreted in a manner as to be
effective and valid under applicable law, but if any provision hereof is held to
be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating or otherwise adversely affecting the remaining provisions hereof.
If a court of competent jurisdic tion should determine that a provision hereof
would be valid or enforceable if a period of time were extended or shortened or
a particular percentage were increased or decreased, then such court may make
such change as shall be necessary to render the provision in question effective
and valid under applicable law.
0229901.02-New YorkS5A
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73
Exhibit C
9.9% NON-VOTING MANDATORILY REDEEMABLE
PREFERRED STOCK, SERIES B
(1) Designation; Number of Shares. The designation of the series of
Preferred Stock, par value $.01 per share, of the Company created hereby shall
be "9.90% Non-voting Mandatorily Redeemable Preferred Stock, Series B"
(including, in the case of any reclassification, recapitalization, or other
change to such Preferred Stock or, in the case of a consolidation or merger of
the Company with or into another Person affecting such Preferred Stock, such
capital stock to which a holder of such Preferred Stock shall be entitled upon
the occurrence of such event, the "Mandatorily Redeemable Preferred Stock"). The
authorized number of shares of Mandatorily Redeemable Preferred Stock shall be
52,217, which number may from time to time be increased or decreased (but not
below the number then outstanding). Each share of Mandatorily Redeemable
Preferred Stock shall have a stated value of $1,000 (the "Stated Value").
Any shares of Mandatorily Redeemable Preferred Stock redeemed or
otherwise acquired by the Company shall be retired and shall resume the status
of authorized and unissued shares of Preferred Stock, without designation as to
series, until such shares are once more designated as part of a particular
series of Preferred Stock by the Board of Directors.
(2) Certain Definitions. Unless the context otherwise requires, the
terms defined in this paragraph (2) shall have, for all purposes of this
Certificate of Designations, the meanings herein specified:
"Adjustment Date" shall have the meaning set forth in paragraph
(4)(k).
"Affiliate" of any Person shall mean another Person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such first person, where "control" shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management policies of a person, whether through the ownership
of voting securities, by contract, as trustee or executor, or otherwise.
"Applicable Price" shall mean the aggregate of (A) in the event of a
Reorganization in which the holders of Common Stock receive cash, the amount of
such cash receivable by the holder of one share of Common Stock (as such share
is in effect immediately prior to the consummation of such Reorganization); and
(B) in the event of a Reorganization in which the holders of Common Stock
receive securities or other property which are traded on an established market
(within the
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meaning of Treasury Regulation 1.1273-2(f)(1) of the Internal Revenue Code of
1986, as in effect on September 30, 1990), the average (or if there be more than
one security or item of property the sum of the averages) of the daily Trading
Prices of such securities and/or property receivable by the holder of one share
of Common Stock (as such share is in effect immediately prior to such
consummation) for the period of ten consecutive Trading Days ending on the
Trading Day immediately preceding date of occurrence of the Reorganization,
appropriately adjusted to take into account any stock dividend on such security
or property, or any subdivision, split, combination, reclassification of such
security or property that occurs or the "ex" date for which occurs on or prior
to such date.
"Average Market Price" on any Determination Date or Adjustment Date,
as applicable, shall mean the average of the daily Closing Prices for the period
of 10 consecutive Trading Days, ending on the Trading Day immediately preceding
such Determination Date or Adjustment Date, as applicable, appropriately
adjusted to take into account any stock dividend on the Common Stock or any
subdivision, split, combination or reclassification of the Common Stock that
occurs, or the date on which "ex-dividend" trading commences, during the period
following the first Trading Day in such ten-Trading Day period to and including
the Determination Date or Adjustment Date, as applicable.
"Board" shall mean the Board of Directors of the Company, and,
unless the context indicates otherwise, shall also mean, to the extent permitted
by law, any committee thereof authorized, with respect to any particular matter,
to exercise the power of the Board of Directors of the Company with respect to
such matter.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in New York, New York and London, England are
authorized to close or not obligated by law or executive order to open.
"Closing Price" shall mean, on any day:
(i) the average between the high and low reported sale price of a
share of Common Stock on and as reported by the Nasdaq Stock Market's National
Market on such day;
(ii) if the primary trading market for the Common Stock on such day
is not the Nasdaq Stock Market's National Market, then the closing sale price
regular
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way on such day, or, in case no such sale takes place on such day, the average
of the reported closing bid and asked prices regular way on such day, in either
case as reported by the Nasdaq System, the National Quotations Bureau, Inc. or a
compara ble service;
(iii) if the Closing Price on such day is not available pursuant to
one of the methods specified above, then the average of the bid and asked prices
for the Common Stock on such day as furnished by any New York Stock Exchange
member firm selected from time to time by the Board for that purpose; or
(iv) if the Closing Price on such day is not available pursuant to
the method specified in (iii) above, the determination of Closing Price shall be
deter mined in good faith by the Board exercising its reasonable discretion.
"Commission" shall have the meaning set forth in paragraph (4)(k).
"Common Stock" shall mean the shares of common stock, par value
$0.01 per share, of the Company, which term shall include, where appropriate, in
the case of any reclassification, recapitalization or other change in the Common
Stock, or in the case of a consolidation or merger of the Company with or into
another Person affecting the Common Stock, such capital stock to which a holder
of Com mon Stock shall be entitled upon the occurrence of such event.
"Common Stock Dividend Amount" shall have the meaning set forth in
paragraph (3) (c).
"Convertible Securities" shall mean securities, including evidences
of indebtedness or shares of stock, which are, at the option of the holder
thereof, convertible into or exchangeable, directly or indirectly, for shares of
Common Stock.
"Determination Date" shall mean: (i) in the case of a dividend
payment, the record date for such dividend payment, (ii) in the case of a
redemption payment pursuant to paragraph (4)(a), the Redemption Date, (iii) in
the case of a redemption payment pursuant to paragraph (4)(b), the tenth
anniversary of the Issue Date, (iv) in the case of a redemption payment pursuant
to paragraph (4)(d), the Adjustment Date, and (v) in the case of a
Reorganization, the date the Reorganization occurs.
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"Effectiveness Date" shall have the meaning set forth in paragraph
(4)(k).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, or any successor statute, and the rules and
regulations promulgated thereunder.
"Extended Sale Date" shall have the meaning set forth in paragraph
(4)(k).
"Fixed Price", on any Determination Date with respect to any Other
Equity Security, shall have the meaning assigned to such term in the certificate
of designations relating to, and setting forth the terms of, such Other Equity
Security.
"Full Consideration Amount" shall have the meaning set forth in
paragraph (4)(k).
"Issue Date" shall mean December 21, 1998.
"JPPF" shall mean the Series A Junior Participating Preferred Stock
of the Company issuable upon exercise of the Rights pursuant to the Rights Agree
ment.
"Junior Stock" shall mean:
(i) each class or series of common stock of the Company, including,
without limitation, the Common Stock;
(ii) the JPPF issuable upon exercise of the Rights;
(iii) any other class or series of capital stock of the Company
hereafter created, other than (a) any class or series of Parity Stock (except to
the extent provided under clause (iv) hereof) and (b) any class or series of
Senior Stock, and
(iv) any class or series of Senior Stock or Parity Stock to the
extent that it ranks junior to the Mandatorily Redeemable Preferred Stock as to
dividend rights, rights of redemption or rights on liquidation, as the case may
be. For pur poses of clause (iii) above, a class or series of Senior Stock or
Parity Stock shall rank
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junior to the Mandatorily Redeemable Preferred Stock as to dividend rights,
rights of redemption or rights on liquidation if the holders of shares of
Mandatorily Redeem able Preferred Stock shall be entitled to dividend payments,
payments on redemption or payments of amounts distributable upon dissolution,
liquidation or winding up of the Company, as the case may be, in preference or
priority to the holders of shares of such class or series of Senior Stock or
Parity Stock.
"Liquidating Payment" shall mean an amount equal to the Liquidation
Preference of a share of Mandatorily Redeemable Preferred Stock or, if less, the
amount payable in respect of one share of Mandatorily Redeemable Preferred Stock
pursuant to paragraph (7)(a) upon the voluntary or involuntary liquidation,
dissolu tion or winding up of the affairs of the Company.
"Liquidating Payment Date" shall mean the date on which the Company
makes the aggregate Liquidating Payment to all holders of outstanding shares of
Mandatorily Redeemable Preferred Stock.
"Liquidation Preference" measured per share of the Mandatorily
Redeemable Preferred Stock, shall mean an amount equal to (a) the Stated Value
per share of Mandatorily Redeemable Preferred Stock, plus (b) for purposes of
determin ing the amount payable pursuant to paragraph (7) only, an amount equal
to all dividends accrued but unpaid on such share, whether or not such unpaid
dividends have been declared or there are funds of the Company legally available
for the payment of dividends, to the Liquidating Payment Date.
"Mandatorily Redeemable Preferred Stock" shall have the meaning set
forth in paragraph (1).
"Mandatory Redemption Price" shall have the meaning set forth in
paragraph (4)(b).
"Option" shall mean any right, option or warrant entitling the
holder thereof to subscribe for, purchase, or otherwise acquire Convertible
Securities or Common Stock in the Company (other than the Rights).
"Other Equity Security" shall mean any equity security of the Com
pany, other than Common Stock, issued by the Company to provide funds for the
payment in cash of the Redemption Price or Mandatory Redemption Price in
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accordance herewith, with the rights to be determined in the sole discretion of
the Company.
"Parity Stock" shall mean the Mandatorily Redeemable Preferred Stock
and any class or series of capital stock, whether now existing or hereafter
created, of the Company to the extent ranking on a parity basis with the
Mandatorily Redeemable Preferred Stock as to dividend rights, rights of
redemption or rights on liquidation. Capital stock of any class or series,
whether now or existing or hereafter created, shall rank on a parity as to
dividend, rights of redemption or rights on liquidation with the Mandatorily
Redeemable Preferred Stock, whether or not the dividend rates, dividend payment
dates, redemption or liquidation prices per share or sinking fund or mandatory
redemption provision, if any, are different from those of the Mandatorily
Redeemable Preferred Stock, if the holders of shares of such class or series
shall be entitled to dividend payments, payments on redemption or payments of
amounts distributable upon dissolution, liquidation or winding up of the Com
pany, as the case may be, in proportion to their respective accumulated and
accrued and unpaid dividends, redemption prices or liquidation prices,
respectively, without preference or priority, one over the other, as between the
holders of shares of such class or series and the holders of Mandatorily
Redeemable Preferred Stock. No class or series of capital stock that ranks
junior to the Mandatorily Redeemable Preferred Stock as to rights on liquidation
shall rank or be deemed to rank on a parity basis with the Mandatorily
Redeemable Preferred Stock as to dividend rights or rights of redemption.
"Payment Record Date" shall have the meaning set forth in paragraph
(12).
"Permitted Cost" shall mean underwriting costs, brokerage fees and
related costs and expenses not exceeding 3% for Common Stock or 5% for any Other
Equity Security of either the applicable amount of the Redemption Price or
Mandatorily Redemption Price (in the event that any Other Equity Security is
issued in order to provide cash for the redemption), or of gross proceeds (in
any other case).
"Person" shall mean any individual corporation, partnership, joint
venture, association, joint stock company, limited liability company, trust,
unincor porated organization, government or agency or political subdivision
thereof, or other entity, whether acting in an individual, fiduciary or other
capacity.
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"Redemption Agent" shall have the meaning set forth under paragraph
(4)(h).
"Redemption Date" as to any share of Mandatorily Redeemable
Preferred Stock, shall mean the date on which such share is redeemed by the Com
pany pursuant to paragraph (4).
"Redemption Notice" shall have the meaning set forth in paragraph
(4)(f).
"Redemption Price" shall have the meaning set forth in paragraph
(4)(a).
"Registration Statement" shall have the meaning set forth in
paragraph (4)(k).
"Reorganization" shall mean any of the following events:
(i) any consolidation or merger of the Company with another entity
(other than a merger or consolidation in which the Company is the surviving or
continuing corporation and in which the Common Stock outstanding immediately
prior to the merger or consolidation remains unchanged),
(ii) the sale or other transfer of all or substantially all of its
assets to another entity,
(iii) any reorganization or reclassification of the Common Stock or
other equity securities of the Company, and
(iv) any statutory exchange of any shares of capital stock of the
Company for shares of capital stock of another corporation (other than a merger
or consolidation in which the Company is the surviving or continuing corporation
and in which the Common Stock outstanding immediately prior to the merger or
consoli dation remains unchanged).
"Reorganization Unit" means the kind or amount of securities, cash
or other property receivable upon consummation of a Reorganization in
substitution of or in exchange for a share of Common Stock as such share is in
effect immediately
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prior to such consummation (provided that if the kind or amount of securities,
cash or other property receivable upon consummation of such Reorganization is
not the same with respect to each such share, then the kind and amount of
securities, cash or other property which shall be deemed receivable upon
consummation of such Reorganization with respect to each such share for purposes
hereof shall be the kind and amount so receivable per share by a plurality of
such shares).
"Rights" means the rights issuable pursuant to the Rights Agreement.
"Rights Agreement" means the rights agreement, dated as of October
13, 1993, between the Company and Continental Transfer and Trust Company, as
rights agent.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time, or any successor statute, and the rules and regulations
promul gated thereunder.
"Senior Stock" shall mean any class or series of capital stock of
the Company hereafter created to the extent ranking prior to the Mandatorily
Redeem able Preferred Stock as to dividend rights, rights of redemption or
rights on liquida tion. Capital stock of any class or series shall rank prior to
the Mandatorily Redeem able Preferred Stock as to dividend rights, rights of
redemption or rights on liquida tion if the holders of shares of such class or
series shall be entitled to dividend payments, payments on redemption or
payments of amounts distributable upon dissolution, liquidation or winding up of
the Company, as the case may be, in preference or priority to the holders of
shares of Mandatorily Redeemable Preferred Stock. No class or series of capital
stock that ranks on a parity basis with or junior to the Mandatorily Redeemable
Preferred Stock as to rights on liquidation shall rank or be deemed to rank
prior to the Mandatorily Redeemable Preferred Stock as to dividend rights or
rights of redemption, notwithstanding that the dividend rate, dividend payment
dates, sinking fund provisions, if any, or mandatory redemption provisions
thereof are different from those of the Mandatorily Redeemable Preferred Stock.
"Stated Value" shall have the meaning set forth in paragraph (1).
"Trading Day" shall mean a day on which the Nasdaq Stock Market's
National Market or, if different, the principal exchange on which the Common
Stock is quoted or traded is each open for the transaction of business.
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"Trading Price" of a security or property for any day means the
closing sale price regular way on such day, or, in case no such sale takes place
on such day, the average of the reported closing bid and asked prices of such
security or property on such day on the applicable established market on which
such security or property is traded.
(3) DIVIDENDS.
(a) Payment. The holders of outstanding shares of Mandatorily
Redeemable Preferred Stock shall be entitled to receive, when, as and if
declared by the Board out of funds legally available therefor (without prejudice
to paragraph (3)(b)), dividends, in preference to dividends on any Junior Stock,
at the rate per annum of 9.90% of the Stated Value per share, rounded to the
nearest cent. Such dividends shall accrue from the Issue Date and shall be
payable on the date the Mandatorily Redeemable Preferred Stock is redeemed
pursuant to paragraph (4).
Dividends on the outstanding shares of Mandatorily Redeemable
Preferred Stock will accrue on a daily basis (without interest or compounding)
whether or not there are funds legally available for the payment of such
dividends and whether or not such dividends are declared. Dividends will cease
to accrue in respect of shares of Mandatorily Redeemable Preferred Stock on the
date of their redemption. No interest, or sum of money in lieu of interest,
shall be payable in respect of any accrued dividend payment.
(b) Declaration and Manner of Payment of Dividends. Any divi dends
may be paid, in the sole discretion of the Board: (i) in cash out of funds
legally available therefor; (ii) through the delivery of shares of Common Stock;
or (iii) through any combination of the foregoing forms of consideration elected
by the Board in its sole discretion. If any dividend declared by the Board is to
be paid, in whole or in part, through the delivery of shares of Common Stock,
each holder of Mandatorily Redeemable Preferred Stock shall receive the same
proportion of cash and/or shares of Common Stock (except for cash paid in lieu
of fractional shares) delivered in payment of such dividend to other holders of
shares of Mandatorily Redeemable Preferred Stock.
(c) Payment of Dividends by Delivery of Common Stock. If the Company
elects to pay any dividend payment, in whole or in part, by delivery of shares
of Common Stock, the amount of such dividend payment to be paid per share of
Mandatorily Redeemable Preferred Stock in shares of Common Stock (the
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"Common Stock Dividend Amount") shall be paid through the delivery to the
holders of record for such shares of Mandatorily Redeemable Preferred Stock on
the record date for such dividend payment (which shall be not more than 10 days
prior to the payment date) of a number of shares of Common Stock determined by
dividing the Common Stock Dividend Amount by the Average Market Price. No
fractional shares of Common Stock shall be delivered to a holder of shares of
Mandatorily Redeemable Preferred Stock, but the Company shall instead pay a cash
adjustment determined as provided in paragraph (8). Common Stock so payable
shall receive the benefit of customary resale registration rights.
(d) Prohibitions on Cash Dividends. Notwithstanding anything
contained in this Certificate to the contrary, but without effect on the accrual
thereof, no cash dividends on shares of Mandatorily Redeemable Preferred Stock
shall be declared by the Board or paid or set apart for payment by the Company
at such time as the terms and provisions of any agreement of the Company,
including, without limitation, any agreement, contract, indenture, bond, note,
debenture, guarantee or other instrument relating to or evidencing its
indebtedness, prohibits such declara tion, payment or setting apart for payment
or provides that such declaration, payment or setting apart for payment would
constitute a breach thereof or a default thereun der; provided, however, that
nothing contained in this paragraph (d) shall alter, limit or restrict the
Company's obligation to declare and pay accrued dividends, to the extent
permitted by applicable law, through the delivery of shares of Common Stock,
whether permitted by any such agreement or not.
(e) Pro Rata. All dividends paid with respect to the shares of
Mandatorily Redeemable Preferred Stock shall be paid pro rata (as nearly as may
be practicable) to the shareholders entitled thereto.
(f) Priority. Payment of dividends to the holders of shares of
Mandatorily Redeemable Preferred Stock shall be subject to the prior preferences
and other rights of any Senior Stock and to the provisions of paragraph (6).
(4) REDEMPTION.
(a) Optional Redemption. At any time during the period beginning on
the Issue Date until the Redemption Date, the Company shall have the right to
redeem the outstanding shares of Mandatorily Redeemable Preferred Stock at a
price equal to $1,000 per share, together with an amount equal to all dividends
accrued but unpaid thereon to the Redemption Date (the "Redemption Price").
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(b) Mandatory Redemption. All outstanding shares of Mandatorily
Redeemable Preferred Stock shall be mandatorily redeemed by the Company out of
funds legally available therefor on the date that is the tenth anniversary of
the Issue Date at a redemption price equal to $1,000 per share, plus an amount
equal to all accrued and unpaid dividends per share to the Redemption Date (the
"Mandatory Redemption Price").
(c) Event of Reorganization. All outstanding shares of Mandatorily
Redeemable Preferred Stock shall be mandatorily redeemed by the Company at the
Mandatory Redemption Price in the event of a Reorganization, other than a Reorga
nization as set forth in paragraph (5)(a) or any other transaction undertaken
for the bona fide purpose of causing the Common Stock of the Company to be
convertible into or exchangeable for, immediately or over time, equity
securities of a public limited company incorporated in England and/or Wales for
the purpose of listing on the London Stock Exchange.
(d) Early Mandatory Redemption. If by June 15, 2000, the Company has
neither exercised its right to optionally redeem the Mandatorily Redeemable
Preferred Stock pursuant to paragraph (4)(a) nor redeemed the Mandatorily Redeem
able Preferred Stock pursuant to paragraph (4)(c), all outstanding shares of
Mandatorily Redeemable Preferred Stock shall be mandatorily redeemed by the
Company at the Mandatory Redemption Price, less any Permitted Cost. The
Redemption Date for such redemption shall be July 1, 2000.
(e) Company's Right to Elect Manner of Payment of Redemption Price
or Mandatory Redemption Price. The Company may effect the redemption of shares
of Mandatorily Redeemable Preferred Stock at the Redemption Price or the
Mandatory Redemption Price, in the sole discretion of the Board: (i) in cash out
of funds legally available therefor, (ii) subject to compliance with paragraph
(g), in exchange for and through the delivery of shares of Common Stock, or
(iii) through any combination of the foregoing forms of consideration elected by
the Board in its sole discretion.
(f) Notice of Redemption. In the event of an offer by the Company to
redeem any shares of Mandatorily Redeemable Preferred Stock pursuant to para
graph (4)(a) or a redemption of the Mandatorily Redeemable Preferred Stock
pursuant to paragraph (4)(b), (4)(c) or (4)(d), the Company shall provide notice
of such offer to redeem or such redemption to holders of record of Mandatorily
Re deemable Preferred Stock to be redeemed not less than 30 days (not less than
10 days if the Redemption Price or Mandatory Redemption Price is payable in cash
or Common Stock) nor more than 60 days prior to the Redemption Date. Such notice
(a "Redemption Notice") shall, subject to paragraph (4)(h)(z), be provided in
accor dance with paragraph (13); provided, however, that neither failure to give
such notice nor any defect therein shall affect the validity of the proceedings
for the redemption of any shares of Mandatorily Redeemable Preferred Stock to be
redeemed.
In addition to any information required by law, the Redemption
Notice shall state, as appropriate, the following (and may contain such other
informa tion as the Company deems advisable):
(A) whether the redemption is pursuant to paragraph (4)(a),
(4)(b), (4)(c) or (4)(d);
(B) the Redemption Date;
(C) the number of shares of Mandatorily Redeemable Preferred Stock
to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of shares to be redeemed
from such holder;
(D) the Redemption Price or Mandatory Redemption Price and the
form or forms of consideration that the Company has elected to
pay and/or deliver upon such redemption and, if more than one
form of consideration has been elected by the Company, the
designated portions of the Redemption Price or Mandatory
Redemption Price to be paid in each form of consideration so
elected;
(E) the place or places in the United States or England and Wales
where certificates for Mandatorily Redeemable Preferred Stock
to be redeemed are to be surrendered for redemption; and
(F) that dividends on the shares of Mandatorily Redeemable
Preferred Stock to be redeemed shall cease to accrue on the
Redemption Date (unless the Company defaults in making payment
of the Redemption Price).
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(g) Redemption by Delivery of Common Stock. If the Company elects to
pay, in whole or in part, the Redemption Price in respect of shares of
Mandatorily Redeemable Preferred Stock in exchange for and through the delivery
of shares of Common Stock, then the Company shall deliver to each holder of
shares of Mandatorily Redeemable Preferred Stock to be redeemed on the
Redemption Date a number of shares of Common Stock equal to the aggregate
Redemption Price (or designated portion thereof) of such shares of Mandatorily
Redeemable Preferred Stock divided by the Average Market Price. No fractional
shares of Common Stock shall be delivered to a holder of shares of Mandatorily
Redeemable Preferred Stock in payment of the Redemption Price, but the Company
shall instead pay a cash adjustment determined as provided in paragraph (8).
(h) Deposit of Funds and/or Shares. If on or before the Redemption
Date: (x) the Company shall have deposited with any bank or trust company
organized under the laws of the United States of America or any state thereof
having capital, undivided profits and surplus aggregating at least $250 million
(the "Re demption Agent"), cash (including cash for any adjustment in lieu of
delivering fractional shares) and/or shares of Common Stock sufficient to pay in
full the aggregate Redemption Price (calculated through the Redemption Date) for
such shares of Mandatorily Redeemable Preferred Stock on such Redemption Date,
(y) such cash and/or shares of Common Stock are readily available to, but only
to, the holders of Mandatorily Redeemable Preferred Stock in satisfaction of the
obligations of the Company with respect to the payment of the Redemption Price
and (z) the Company shall prior to the Redemption Date have so notified each
record holder of Mandatorily Redeemable Preferred Stock, which notice shall be
given to each holder of Mandatorily Redeemable Preferred Stock by courier and
shall identify the Redemption Agent, its address and telephone and telecopier
numbers and the contact person(s) at the Redemption Agent responsible for
administration of the deposit then, effective as of the close of business on
such Redemption Date (and notwithstanding that any certificate therefor shall
not have been surrendered for cancellation): (i) such shares of Mandatorily
Redeemable Preferred Stock shall no longer be deemed outstanding but any shares
of Common Stock so deposited in accordance with this paragraph (h) for which
such Mandatorily Redeemable Preferred Stock was re deemed shall be deemed to be
outstanding; (ii) the holders thereof shall cease to be holders of Mandatorily
Redeemable Preferred Stock but shall be shown on the records of the Company as
holders of the Common Stock so deposited in accordance with this paragraph (h)
in redemption of such Mandatorily Redeemable Preferred Stock; (iii) dividends
with respect to the shares so called for redemption shall cease to accrue on the
Redemption Date but, subject to paragraph (4)(g), such holders shall
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be entitled to any dividends which shall thereafter accrue on, and shall be
entitled to exercise all other rights associated with, any shares of Common
Stock so deposited in accordance with this paragraph (h) in redemption of such
Mandatorily Redeem able Preferred Stock; and (iv) all rights whatsoever with
respect to the shares so called for redemption shall forthwith cease and
terminate (except the right of such holders, upon the surrender of certificates
evidencing the shares of Mandatorily Redeemable Preferred Stock so redeemed, to
receive the cash and/or Common Stock payable or deliverable in payment of the
Redemption Price therefor, and the applica ble cash adjustment, if any, in lieu
of fractional shares, without interest). Any cash and/or shares of Common Stock
so deposited or set apart which shall remain unclaimed at the end of one year
after the Redemption Date shall be returned or released to the Company, after
which time the holders of shares of Mandatorily Redeemable Preferred Stock
called for redemption on such Redemption Date that remain outstanding after such
one-year period shall look only to the Company for the payment of the Redemption
Price for such shares, without interest.
Subject to compliance with paragraph (4)(k), a deposit made in
compliance with the immediately preceding sentence shall, except to the extent
released or returned to the Company, be deemed to constitute full payment for
the shares of Mandatorily Redeemable Preferred Stock to be redeemed. Any
interest accrued on funds so deposited shall be paid by the Redemption Agent to
the Com pany from time to time.
(i) Surrender of Certificates; Status. Each holder of shares of
Mandatorily Redeemable Preferred Stock to be redeemed shall not be entitled to
receive payment of the Redemption Price or Mandatory Redemption Price for such
shares until such holder shall surrender the certificates evidencing such shares
duly endorsed by, or accompanied by, an instrument of transfer (in form
reasonably satisfactory to the Company) duly executed by, the holder or such
holder's duly authorized attorney-in-fact or, if the shares issuable upon
redemption are to be issued in the same name as the name in which such share of
the Mandatorily Redeemable Preferred Stock is registered, in blank to the
Redemption Agent (or to the Company if there is no Redemption Agent) at the
place designated in the Redemption Notice for such redemption and shall
thereupon be entitled to receive the consideration for such shares specified in
the Redemption Notice in an aggregate amount equal to the Redemption Price or
Mandatory Redemption Price for such shares. Holders of shares of Mandatorily
Redeemable Preferred Stock that are redeemed on the Re demption Date shall not
be entitled to receive dividends declared and paid on any shares of Common Stock
exchangeable and deliverable in payment of the Redemp tion Price or Mandatory
Redemption Price (or designated portion thereof) for such shares of Mandatorily
Redeemable Preferred Stock, and such shares of Common Stock shall not be
entitled to vote, until such shares of Common Stock are delivered upon the
surrender of the certificates representing such shares of Mandatorily Redeemable
Preferred Stock. Upon such surrender, such holders shall be entitled to receive
such dividends declared and paid subsequent to such Redemption Date and prior to
the delivery.
(j) Priority. The right of the Company to redeem shares of
Mandatorily Redeemable Preferred Stock pursuant to this paragraph (4) shall be
subject to the prior preferences and other rights of any Senior Stock and to the
provisions of paragraph (7).
(k) Full Consideration Amount. If the Company elects to exchange and
deliver shares of Common Stock in payment of the Mandatory Redemption Price (or
a designated portion thereof) pursuant to paragraph (e), the Company shall be
obligated to file (on or prior to April 1, 2000) and cause to be declared
effective by the Securities and Exchange Commission (the "Commission") a resale
"shelf" registration statement (the "Registration Statement"), or such other
successor form of registration statement that may be adopted by the Commission
from time to time, on behalf of the holders of such Common Stock. The Company
may deliver shares of Common Stock having a value (equal to the Average Market
Price as of April 1, 2000) to the holders. When the Registration Statement is
declared effective (the "Effectiveness Date"), the holders shall sell at the
time (but no later than the later to occur of June 15, 2000 and ten Business
Days after the Effectiveness Date (the "Extended Sale Date")) and in a bona fide
manner designated by the Company (but shall not sell or transfer in any other
manner until after June 15, 2000 (if the Effec tiveness Date has not theretofore
occurred) and prior to the Effectiveness Date), the shares of Common Stock
received in redemption of the Mandatorily Redeemable Preferred Stock and the
holders shall be required to cooperate fully (including by executing customarily
required documentation) in such process and the holders shall retain the
proceeds of such sale. On or prior to the later to occur of July 1, 2000 and two
Business Days after the Extended Sale Date (either, the "Adjustment Date"), the
Company shall deliver to such holders, on a pro rata per share basis,
consideration (payable as set forth in paragraph (l)) equal to (a) (pound)31
million, together with accrued and unpaid dividends, calculated to the date of
such delivery, as if the Mandatorily Redeemable Preferred Stock had remained
outstanding until the Adjustment Date (the "Full Consideration Amount"), minus
the aggregate of (b) (i) in the event that any such holders have previously sold
all or a portion of their shares of Common
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Stock pursuant to such Registration Statement or otherwise by such date, the
aggregate amount of proceeds from any such sale (without deduction of any custom
ary underwriting costs, brokerage fees and other related costs and expenses not
exceeding the Permitted Cost), plus (ii) in the event that any such holders
still retain (by agreement of the holders and the Company) all or a portion of
their shares of Common Stock on such date, the amount which is equal to the
current market value of such shares of Common Stock, as determined using the
Average Market Price, as of the Adjustment Date, plus (iii) the aggregate amount
of any cash previously delivered in payment of the Redemption Price; provided,
however, that (i) in no event shall any payment be made pursuant to this
paragraph if the amount deter mined pursuant to subparagraph (b) above exceeds
the Full Consideration Amount and (ii) if for any reason (other than agreement
of the holders and the Company) shares of Common Stock are not sold by the
Adjustment Date, the Full Consider ation Amount shall be adjusted to and
calculated as of the date the shares are actually sold.
(l) Payments with Respect to Full Consideration Amount. Any payment
required to be made by the Company pursuant to the preceding paragraph may be
paid, in the sole discretion of the Company, (i) in cash out of funds legally
available therefor, (ii) in exchange for and through the delivery of shares of
Common Stock, valued as of the Adjustment Date, or (iii) through any combination
of the foregoing forms of consideration elected by Company in its sole
discretion. Com mon Stock so payable shall be valued at the Average Market Price
as of the Adjust ment Date and shall promptly receive the benefit of customary
resale registration rights.
(m) Other Equity Security. If the Company elects to sell any Other
Equity Security at any time prior to June 15, 2000 in order to fund the
redemption of the Mandatorily Redeemable Preferred Stock and/or Common Stock
issued in redemption thereof, the holders will deliver such securities to the
Company in exchange for the proceeds of the sale of such Other Equity Security
(less any Permitted Cost).
(5) REORGANIZATIONS.
(a) Holding Company. Notwithstanding anything herein to the
contrary, if the Company is reorganized such that the Common Stock is exchanged
for the common stock of a new entity ("Holdco") whose common stock is traded on
NASDAQ or another recognized securities exchange, then the Company, by notice to
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the holders of the Mandatorily Redeemable Preferred Stock but without any
required consent on their part, may cause the exchange of this Mandatorily
Redeemable Preferred Stock for mandatorily redeemable preferred stock of Holdco
having the same terms and conditions as set forth herein, provided that where
Holdco is not solely incorporated as a Delaware company or where the Holdco
share structure is not identical to that of the Company, the rights attaching to
the mandatorily redeem able preferred stock of Holdco may be adjusted so as to
comply with the local law of the country of incorporation of Holdco or the new
share structure of Holdco subject to such rights effectively giving the same
economic rights as the Mandatorily Redeemable Preferred Stock (ignoring for
these purposes any resultant change in the tax treatment for the holders of such
stock).
(b) Notices of Corporate Action. If:
(i) the Company or the Board shall approve any Reorganization to
which the Company is a party and for which approval of any stockholders of the
Company is required; or
(ii) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in each case, the Company shall cause to be given to the holders of shares
of the Mandatorily Redeemable Preferred Stock in accordance with paragraph (13),
as promptly as possible, but at least 10 days prior to the applicable date
hereinafter specified, a notice stating the date on which the event giving rise
to an adjustment of the type described in paragraph (6)(a), such a
Reorganization, dissolution, liquidation or winding up may occur, as the case
may be, is expected to become effective or occur, and, if earlier, 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 stock of the Company, securities,
cash or other property deliverable upon such Reorganiza tion, dissolution,
liquidation or winding up. Failure to give or receive such notice or any defect
therein shall not affect the legality or validity of the action or transactions
described in sub-paragraphs (i) or (ii) above.
(c) Listing of Common Stock. The Company will list the shares of
Common Stock required to be delivered as payment of dividends or upon redemption
or conversion of shares of the Mandatorily Redeemable Preferred Stock, prior to
delivery, upon each national securities exchange, the Nasdaq Stock Market's Na
tional Market or any similar system of automated dissemination of securities
prices, if any, upon which the Common Stock is listed at the time of delivery.
(d) Provision of Information. So long as any shares of Mandatorily
Redeemable Preferred Stock remain outstanding, the Company undertakes to provide
without charge to each record holder of such shares copies of each: (i) annual
report of the Company on Form 10-K filed pursuant to Section 13(a) of the
Exchange Act concurrently with such filing; (ii) quarterly reports of the
Company on Form 10-Q and current report of the Company on Form 8-K filed
pursuant to Section 13(a) or 15(d) or the Exchange Act concurrently with such
filing; (iii) definitive proxy or information statement, form of proxy or other
material of the Company filed pursu ant to Section 14(a) of the Exchange Act
concurrently with such filing; and (iv) notice, press release and other
information delivered to holders of Common Stock generally concurrently with
such delivery.
(6) LIMITATIONS ON DIVIDENDS AND REDEMPTIONS IN RESPECT OF COMPANY
STOCK.
(a) Limitations on Junior Stock Dividends. As long as any shares of
Mandatorily Redeemable Preferred Stock are outstanding, no dividends shall be
paid or declared in cash on Junior Stock, nor shall any other distributions be
made on any Junior Stock.
(b) Limitations on Purchase of Junior Stock. As long as any shares
of Mandatorily Redeemable Preferred Stock are outstanding, no shares of any
Junior Stock may be purchased, redeemed, or otherwise acquired by the Company or
any of its subsidiaries (except in connection with a reclassification of any
Junior Stock through the issuance of other Junior Stock and/or Convertible
Securities for shares of Junior Stock and cash in lieu of fractional shares in
connection therewith, or the purchase, redemption or other acquisition of any
Junior Stock from any wholly-owned subsidiary), nor may any funds be set aside
or made available for any sinking fund for the purchase, redemption or other
acquisition of any Junior Stock.
(c) Limitations on Parity Stock Dividends and Redemptions. As long
as any share of Mandatorily Redeemable Preferred Stock is outstanding, dividends
or other distributions may not be declared or paid on any Parity Stock, and the
Com pany may not purchase, redeem or otherwise acquire any Parity Stock (other
than any outstanding shares of 9.90% Non-Voting Mandatorily Redeemable Preferred
Stock, Series A, issued pursuant to the Certificate of Designations of the
Company, dated
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September 21, 1998, or outstanding shares of 13% Series B Senior Redeemable
Exchangeable Preferred Stock, issued pursuant to the Certificate of Designations
of the Company, dated February 12, 1997) (except (x) from any wholly-owned
subsid iaries of the Company or (y) in connection with a mandatory conversion or
exchange of such Parity Stock or a conversion or exchange of such Parity Stock
at the option of the holder for securities other than Parity Stock or Senior
Stock and cash in lieu of fractional shares in connection therewith), unless
with respect to the payment of dividends only, any such dividends are declared
and paid pro rata so that the amounts of any dividends declared and paid per
share on shares of Mandatorily Redeemable Preferred Stock and each other share
of such Parity Stock will in all cases bear to each other the same ratio that
accrued and unpaid dividends (including any accumu lation with respect to unpaid
dividends for prior dividend periods, if such dividends are cumulative) per
share on shares of Mandatorily Redeemable Preferred Stock and such other share
of Parity Stock bear to each other.
(d) Certain Permitted Dividends and Redemptions. Nothing contained
in this paragraph (6) shall prevent: (i) the payment of dividends or the making
of distributions on any Junior Stock solely in shares of Junior Stock and/or
Convertible Securities for shares of Junior Stock (together with a cash
adjustment for fractional shares, if any) or the redemption, purchase or other
acquisition of Junior Stock solely in exchange for (together with a cash
adjustment for fractional shares, if any), or through the application of the
proceeds from the sale of, shares of Junior Stock and/or Convertible Securities
for shares of Junior Stock; (ii) the payment of dividends or the making of
distributions on any class or series of Parity Stock solely in (together with a
cash adjustment for fractional shares, if any) shares of Junior Stock and/or
Convertible Securities for shares of Junior Stock or the redemption, exchange,
purchase or other acquisition of any class or series of Parity Stock solely in
exchange for (together with a cash adjustment for fractional shares, if any), or
through the application of the proceeds from the sale of shares of Junior Stock
and/or Convertible Securities for shares of Junior Stock or (iii) the conversion
or exchange of Mandatorily Redeemable Preferred Stock into or for shares of
Common Stock (together with a cash adjustment for fractional shares, if any) and
other securities, assets or property, if any pursuant to the provisions of
paragraphs (3), (4) or (5).
(f) Waiver. The provisions of paragraphs (6)(a), (b) and (d) are for
the sole benefit of the holders of Mandatorily Redeemable Preferred Stock and
any other class or series of Parity Stock having the terms described therein and
accord ingly, at any time when (i) there are no shares of any such other class
or series of Parity Stock outstanding or if the holders of each such other class
or series of Parity
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Stock have, by such vote or consent of the holders thereof as may be provided
for in the instrument creating or evidencing such class or series, waived in
whole or in part the benefit of such provisions (either generally or in the
specific instance), and (ii) the holders of shares of Mandatorily Redeemable
Preferred Stock shall have waived (as provided in paragraph (14)) in whole or in
part the benefit of such provision (either generally or in the specific
instance), then the provisions of paragraphs (6)(a), (b) and (d) shall not (to
the extent waived, in the case of any partial waiver) restrict the payment of
dividends or the making of distributions on, or the redemption, purchase or
other acquisition of any shares of, Mandatorily Redeemable Preferred Stock, any
other class or series of Parity Stock or any Junior Stock.
(7) LIQUIDATION RIGHTS.
(a) Payment of Liquidation Preference. If there is any liquidation,
dissolution, or winding up of the Company, whether voluntary or involuntary,
then the holders of shares of Mandatorily Redeemable Preferred Stock then
outstanding, after payment, or provision for payment of the debts and other
liabilities of the Company and the payment or provision for payment of any
distribution on any shares of Senior Stock, and before any distribution to the
holders of Junior Stock, shall be entitled to be paid out of the assets of the
Company available for distribution to its stockholders an amount per share of
Mandatorily Redeemable Preferred Stock in cash equal to the Liquidation
Preference. If the assets of the Company available for distribution to the
holders of the shares of Mandatorily Redeemable Preferred Stock upon any
dissolution, liquidation or winding up of the Company shall be insufficient to
pay in full the Liquidation Preference payable to the holders of outstanding
shares of Mandatorily Redeemable Preferred Stock and the liquidation preference
payable to all other shares of Parity Stock (as set forth in the instrument or
instruments creating such Parity Stock), then the holders of shares of
Mandatorily Redeemable Preferred Stock and of all other shares of Parity Stock
shall share ratably in such distribution of assets in proportion to the amount
which would be payable on such distribution if the amounts to which the holders
of outstanding shares of Mandatorily Redeemable Preferred Stock and the holders
of outstanding shares of such other Parity Stock were paid in full. Except as
provided in this paragraph (7)(a), holders of Mandatorily Redeemable Preferred
Stock shall not be entitled to any distribution in the event of the liquidation,
dissolution or winding up of the affairs of the Company.
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(b) Certain Events Not Deemed Liquidation, Etc. For the purposes of
this paragraph (7) a Reorganization shall not be deemed to be a voluntary of
involuntary liquidation, dissolution or winding up of the Company.
(8) NO FRACTIONAL SHARES. No fractional shares of Common Stock or
scrip shall be issued in connection with the delivery of shares of Common Stock
in payment, in whole or in part, of any dividend, Redemption Price or Liqui
dating Payment. Whether or not a fractional share would be delivered to a holder
of Mandatorily Redeemable Preferred Stock shall be based upon, in the case of
the payment, in whole or in part, of dividends, a Redemption Price or a
Liquidating Payment pursuant to paragraphs (3), (4) or (7) , respectively, on
the total number of shares of Mandatorily Redeemable Preferred Stock at the time
held by such holder and the total number of shares of Common Stock, otherwise
deliverable in respect thereof. Instead of the issuance of a fraction of a share
of Common Stock or scrip, the Company shall pay instead an amount in cash
(rounded to the nearest whole cent) equal to, in the case of Common Stock, the
same fraction of the Closing Price of a share of preceding the Determination
Date.
(9) PAYMENT OF TAXES. The Company shall pay any and all documentary,
stamp or similar transfer taxes payable in respect of the delivery of shares of
Common Stock, pursuant to paragraphs (3), (4) or (7), as applicable; provided,
however, the Company shall not be required to pay any such tax that may be
payable because any such shares are issued in a name other than the name of the
holder of such Mandatorily Redeemable Preferred Stock.
(10) NO PREEMPTIVE RIGHTS. The holders of shares of Mandatorily
Redeemable Preferred Stock shall have no preemptive rights, including preemptive
rights with respect to any shares of capital stock or other securities of the
Company convertible into or carrying rights or options to purchase any such
shares.
(11) VOTING RIGHTS. (a) The holders of shares of Mandatorily
Redeemable Preferred Stock shall have no Voting rights, except as otherwise
required by law and except as set forth in this paragraph (11). When and if the
holders of Mandatorily Redeemable Preferred Stock are entitled to vote by law or
pursuant to this paragraph (11), each holder will be entitled to one vote per
share.
(b) Certain Changes to Charter. For as long as any shares of
Mandatorily Redeemable Preferred Stock remain outstanding, the affirmative vote
of the holders of at least a majority of such outstanding shares (voting
separately as a
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class) given in Person or by proxy at an annual meeting or a special meeting
called for such purpose, shall be necessary (i) before the Company may amend any
of the provisions of this Certificate of Designations or the Restated
Certificate of Incorpora tion of the Company which would alter or change the
powers, preferences or special rights of the holders of the shares of
Mandatorily Redeemable Preferred Stock then outstanding so as to affect them
adversely; provided, however, that:
(x) any such amendment that would authorize, create or increase the
authorized amount of any additional shares of Junior Stock or shares
of any other class or series of Parity Stock (whether or not already
authorized); and
(y) any such amendment that would increase the number of authorized
shares of Preferred Stock of the Company (but not the number of
authorized shares of Mandatorily Redeemable Preferred Stock) or that
would decrease (but not below the number of shares, then
outstanding) the number of authorized shares of Preferred Stock (but
not the number of authorized shares of Mandatorily Redeemable
Preferred Stock);
shall be deemed not to adversely affect such powers preferences or rights and
shall not be subject to approval by the holders of shares of Mandatorily
Redeemable Preferred Stock; and (ii) before the Company may reclassify the
outstanding shares of Mandatorily Redeemable Preferred Stock into another class
or series of capital stock of the Company; provided further, however, that no
consent described in clause (i) of this paragraph of the holders of the shares
of Mandatorily Redeemable Pre ferred Stock shall be required if, at or prior to
the time when such amendment is to take effect, provision is made for the
redemption of all shares of Mandatorily Redeemable Preferred Stock at the time
outstanding.
(c) Creation of Senior Stock. No consent or vote of the holders of
the shares of Mandatorily Redeemable Preferred Stock shall be necessary before
the Company or the Board may authorize, create or issue any class or series of
Senior Stock.
(d) No Other Vote. Except as otherwise set forth in this paragraph
(11) or as required by law, the holders of Mandatorily Redeemable Preferred
Stock shall not have any relative, participating, optional or other special
voting rights and powers and the consent or vote of such holders shall not be
required for the taking of
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any corporate action by the Company or the Board. The provisions of this
paragraph (11) are in lieu of, and not in addition to, any voting rights
specified in the Restated Certificate of Incorporation as applicable to a series
of Preferred Stock.
(12) PAYMENTS. Payment of cash amounts due in respect of the
Mandatorily Redeemable Preferred Stock will be paid to the holders of shares of
Mandatorily Redeemable Preferred Stock (or, in the case of joint holders, the
first-named) as appearing in the stock register of the Company for the
Mandatorily Redeemable Preferred Stock as at opening of business (New York time)
on the date specified in this Certificate for the purpose of determining the
holders of Mandatorily Redeemable Preferred Stock entitled to such payments or,
if no such date is speci fied, the fifteenth Business Day before the due date
for such payment (the "Payment Record Date").
Payments of cash amounts due in respect of the Mandatorily Re
deemable Preferred Stock will be made by a check in U.S. dollars drawn on a bank
in New York and mailed to the address (as recorded in the stock register of the
Com pany for the Mandatorily Redeemable Preferred Stock) of the holder thereof
(or, in the case of joint holders, the first-named) not later than the relevant
date for payment unless, prior to the relevant Payment Record Date, the Company
has received from the holder thereof (or, in the case of joint holders, the
first-named) written instruc tions for payment to be made by wire transfer to a
specified designated account. If the due date for payment of any cash amount in
respect of the Mandatorily Redeem able Preferred Stock is not a Business Day,
then the holder thereof will not be entitled to payment thereof until the next
following day which is a Business Day and, if such payment is to be made by
transfer to a designated account rather than by check, a day on which commercial
banks and foreign exchange markets settle, payments in U.S. dollars in the place
where the relevant designated account is located.
(13) NOTICES. Any notice or communication by a holder of Mandatorily
Redeemable Preferred Stock to the Company is duly given if in writing and
delivered in person or mailed by first-class mail to the Company at its address
as set forth in its then most recently filed Form 10-K or 10-Q as the case may
be.
Any notice or communications to a holder of Mandatorily Redeem able
Preferred Stock shall be mailed by first-class mail to his address shown on the
stock register of the Company for the Mandatorily Redeemable Preferred Stock or,
if there are more than 200 holders of record of the Mandatorily Redeemable
Preferred
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Stock and the Company in its sole discretion so elects, in a leading daily
newspaper having general circulation in New York (which is expected to be the
Wall Street Journal) or England and Wales (which is expected to be The Financial
Times). Failure to mail a notice or communication to one holder or any defect in
it shall not affect its sufficiency with respect to other holders.
If a notice or communication is given in the manner provided in this
paragraph (13) within the time prescribed by this Certificate, it shall be
conclusively presumed to have been duly given, whether or not the person
entitled to such notice receives it.
(14) WAIVER. Any provision of this Certificate of Designations
which, for the benefit of the holders of Mandatorily Redeemable Preferred Stock,
prohibits, limits or restricts actions by the Company may be waived in whole or
in part, or the application of all or any part of such provision in any
particular circum stance or generally may be waived, in each case with the
consent of the holders of at least a majority of the number of shares of
Mandatorily Redeemable Preferred Stock then outstanding, either in writing or by
vote at a meeting called for such purpose at which the holders of Mandatorily
Redeemable Preferred Stock shall vote as a separate class.
(15) REGISTRATION AND NO TRANSFER. The Company will maintain at its
principal executive office a register in which the Company will provide for the
registration of shares of Mandatorily Redeemable Preferred Stock. The shares of
Mandatorily Redeemable Preferred Stock are not transferrable, except to any
Affiliate of any holder thereof, provided, that such shares shall be reconveyed
to any such holder who transfers to an Affiliate in the event that such
Affiliate ceases to be an Affiliate of such transferring holder, and any
certificate representing shares of Mandatorily Redeemable Preferred Stock will
be so legended.
(16) EXCLUSION OF OTHER RIGHTS. Except as may otherwise be required
by law, the shares of Mandatorily Redeemable Preferred Stock shall not have any
designations, preferences, limitations or relative rights other than those
specifically set forth in this Certificate of Designations.
(17) SEVERABILITY OF PROVISIONS. Whenever possible, each provision
of this Certificate of Designations shall be interpreted in a manner as to be
effective and valid under applicable law, but if any provision hereof is held to
be prohibited by or invalid under applicable law, such provision shall be
ineffective
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only to the extent of such prohibition or invalidity, without invalidating or
otherwise adversely affecting the remaining provisions hereof. If a court of
competent jurisdic tion should determine that a provision hereof would be valid
or enforceable if a period of time were extended or shortened or a particular
percentage were increased or decreased, then such court may make such change as
shall be necessary to render the provision in question effective and valid under
applicable law.
0234756.02-New YorkS5A
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96
Exhibit D
5-1/4% CONVERTIBLE PREFERRED STOCK, SERIES A
(1) Number and Designation. 500,000 shares of the Preferred Stock of
the Corporation shall be designated as 5-1/4% Convertible Preferred Stock,
Series A (the "5-1/4% Preferred Stock") and no other shares of Preferred Stock
shall be designated as 5-1/4% Preferred Stock.
(2) Definitions. For purposes of the 5-1/4% Preferred Stock, the following terms
shall have the meanings indicated:
"Board of Directors" shall mean the board of directors of the
Corporation or the Executive Committee, if any, of such board of directors or
any other committee duly authorized by such board of directors to perform any of
its responsibilities with respect to the 5-1/4% Preferred Stock.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which state or federally chartered banking institutions in New York, New
York are not required to be open.
"Common Stock" shall mean the Corporation's Common Stock, par value
$.01 per share.
"Constituent Person" shall have the meaning set forth
in paragraph (8)(e) hereof.
"Conversion Rate" shall have the meaning set forth in
paragraph (8)(a) hereof.
"Current Market Price" of publicly traded shares of Common Stock or
any other class of capital stock or other security of the Corporation or any
other issuer for any day shall mean (i) if the security is then listed or
admitted to trading on a national securities exchange in the United States, the
last reported sale price, regular way, for the security as reported in the
consolidated transaction or other reporting system for securities listed or
traded on such exchange, or (ii) if the security is quoted on the Nasdaq
National Market, the last reported sale price, regular way, for the security as
reported on such list, or (iii) if the security is not so admitted for trading
on any national securities exchange or the Nasdaq National Market, the average
of the last reported closing bid and asked prices reported by the Nasdaq as
furnished by any member in good standing of the National Association of
Securities Dealers, Inc., selected from time to time by the Company for that
D-1
97
purpose or as quoted by the National Quotation Bureau Incorporated. In the event
that no such quotation is available for such day, the Current Market Price shall
be the average of the quotations for the last five Trading Days for which a
quotation is available within the last 30 Trading Days prior to such day. In the
event that five such quotations are not available within such 30-Trading Day
period, the Board of Directors shall be entitled to determine the Current Market
Price on the basis of such quotations as it reasonably considers appropriate.
"Determination Date" shall have the meaning set forth
in paragraph (8)(d) hereof.
"Dividend Payment Date" shall mean September 30, December 30, March
30 and June 30 of each year, commencing on March 30, 1999; provided, however,
that if any Dividend Payment Date falls on any day other than a Business Day,
the dividend payment due on such Dividend Payment Date shall be paid on the
Business Day immediately following such Dividend Payment Date.
"Dividend Periods" shall mean quarterly dividend periods commencing
on September 30, December 30, March 30 and June 30 of each year and ending on
and including the day preceding the first day of the next succeeding Dividend
Period (other than the initial Dividend Period which shall commence on the Issue
Date and end on and include March 30, 1999).
"Fair Market Value" shall mean the average of the daily Current
Market Prices of a share of Common Stock for the 25 Trading Days immediately
prior to the date for which such value is to be computed.
"5-1/4% Preferred Stock" shall have the meaning set forth in
paragraph (1) hereof.
"Issue Date" shall mean the first date on which shares of 5-1/4%
Preferred Stock are issued.
"Junior Securities" shall have the meaning set forth
in paragraph (3) hereof.
"Junior Securities Distribution" shall have the meaning set forth in
paragraph (4)(e) hereof.
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"Mandatory Redemption Date" shall have the meaning set forth in
paragraph (6)(c) hereof.
"Mandatory Redemption Obligation" shall have the meaning set forth
in paragraph (6)(d) hereof.
"Nasdaq" means the National Association of Securities
Dealers, Inc. Automated Quotations System.
"non-electing share" shall have the meaning set forth
in paragraph (8)(e) hereof.
"NYSE" means the New York Stock Exchange.
"outstanding", when used with reference to shares of stock, shall
mean issued shares, excluding shares held by the Corporation or a subsidiary.
"Parity Securities" shall have the meaning set forth
in paragraph (3) hereof.
"Person" shall mean any individual, a corporation, a partnership, an
association, a joint-stock company, a limited liability company, a trust, any
unincorporated organization, or a government or political subdivision thereof.
"Preferred Stock" shall have the meaning set forth in
the first resolution above.
"Preferred Shares" has the meaning set forth in
paragraph (9)(b).
"Relevant Compounding Factor" shall mean, with respect to each share
of 5-1/4% Preferred Stock, upon initial issuance 1.00, and shall on each
Dividend Payment Date be increased to equal the product of the Relevant
Compounding Factor in effect immediately prior to such Dividend Payment Date
and 1.013125.
"Securities" shall have the meaning set forth in
paragraph (8)(d) hereof.
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"Senior Securities" shall have the meaning set forth
in paragraph (3) hereof.
"set apart for payment" shall be deemed to include, without any
action other than the following, the recording by the Corporation in its
accounting ledgers of any accounting or bookkeeping entry which indicates,
pursuant to a declaration of dividends or other distribution by the Board of
Directors, the allocation of funds to be so paid on any series or class of
capital stock of the Corporation; provided, however, that if any funds for any
class or series of Junior Securities or any class or series of Parity Securities
are placed in a separate account of the Corporation or delivered to a
disbursing, paying or other similar agent, then "set apart for payment" with
respect to the 5-1/4% Preferred Stock shall mean placing such funds in a
separate account or delivering such funds to a disbursing, paying or other
similar agent.
"Trading Day" shall mean any day on which the securities in question
are traded on the NYSE, or if such securities are not listed or admitted for
trading on the NYSE, on the principal national securities exchange on which such
securities are listed or admitted, or if not listed or admitted for trading on
any national securities exchange, on the Nasdaq National Market, or if such
securities are not quoted thereon, in the applicable securities market in which
the securities are traded.
"Transaction" shall have the meaning set forth in
paragraph (8)(e) hereof.
(3) Rank. Any class or series of stock of the Corporation shall be deemed to
rank: (1) prior to the 5-1/4% Preferred Stock, either as to the payment
of dividends or as to distribution of assets upon liquidation, dissolution
or winding up, or both, if the holders of such class or series shall be
entitled by the terms thereof to the receipt of dividends and of amounts
distributable upon liquidation, dissolution or winding up, in preference
or priority to the holders of 5-1/4% Preferred Stock ("Senior
Securities");
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(2) on a parity with the 5-1/4% Preferred Stock, either as to the payment of
dividends or as to distribution of assets upon liquidation, dissolution or
winding up, or both, whether or not the dividend rates, dividend payment
dates or redemption or liquidation prices per share thereof be different
from those of the 5-1/4% Preferred Stock, if the holders of the 5-1/4%
Preferred Stock and of such class of stock or series shall be entitled
by the terms thereof to the receipt of dividends or of amounts
distributable upon liquidation, dissolution or winding up, or both,
in proportion to their respective amounts of accrued and unpaid dividends
per share or liquidation preferences, without preference or priority
one over the other and such class of stock or series is not a class of
Senior Securities (Parity Securities); and
(3) junior to the 5-1/4% Preferred Stock, either as to the payment of
dividends or as to the distribution of assets upon liquidation,
dissolution or winding up, or both, if such stock or series shall be
Common Stock or if the holders of the 5-1/4% Preferred Stock shall be
entitled to receipt of dividends, and of amounts distributable upon
liquidation, dissolution or winding up, in preference or priority to the
holders of shares of such stock or series ("Junior Securities").
The 13% Series B Senior Redeemable Exchangeable Preferred Stock (the "13%
Preferred") is a Senior Security. Each of the 9.9% Non-Voting Mandatory
Redeemable Preferred Stock, Series A ("Series A Preferred"), and 9.9%
Non-Voting Mandatory Redeemable Preferred Stock, Series B ("Series B
Preferred"), is a Junior Security. One or more classes of Additional
Preferred (as defined below) shall be Parity Securities provided, however,
that there shall be no issue of other Parity Securities except as approved
by the holders of the 5-1/4% Preferred Stock pursuant to paragraph 9(d).
The respective definitions of Senior Securities, Junior Securities and
Parity Securities shall also include any rights or options exercisable for
or convertible into any of the Senior Securities, Junior Securities and
Parity Securities, as the case may be. The 5-1/4% Preferred Stock shall be
subject to the creation of Junior Securities, Parity Securities and Senior
Securities as set forth herein.
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(4) Dividends. (a) Subject to paragraph (8)(b)(ii), the holders of shares of
5-1/4% Preferred Stock shall be entitled to receive, when, as and if declared by
the Board of Directors, out of funds legally available for the payment of
dividends, dividends at the quarterly rate of $13.125 per share (assuming a
$1,000.00 face amount) payable in cash, shares of Common Stock equal to $13.125
per share of 5-1/4% Preferred Stock (having a value equal to the Current Market
Price as of the record date for such Dividend Payment Date) or additional shares
of Preferred Stock of a class to be designated by the Board of Directors having
terms substantially identical to the 5-1/4% Preferred Stock except that: (i) the
Conversion Rate (as set forth in Section 8(a)) shall be the product of the
Conversion Rate (as then in effect) and the Relevant Compounding Factor and (ii)
the number of the shares of such Preferred Stock payable as a dividend on any
Dividend Payment Date shall increase for each Dividend Payment Date from the
first Dividend Payment Date by the Relevant Compounding Factor (such classes of
Preferred Stock singularly and collectively, the "Additional Preferred"). Such
dividends shall be payable in arrears quarterly on each Dividend Payment Date.
Dividends on the 5-1/4% Preferred Stock shall be cumulative from the Issue Date
(except that dividends on Additional Shares shall accrue from the date such
Additional Shares are issued or would have been issued in accordance with this
Certificate of Designation if such dividends had been declared), whether or not
in any Dividend Period or Periods there shall be funds of the Corporation
legally available for the payment of such dividends. Each such dividend shall be
payable to the holders of record of shares of the 5-1/4% Preferred Stock, as
they appear on the stock records of the Corporation at the close of business on
the record date for such dividend. Upon the declaration of any such dividend,
the Board of Directors shall fix as such record date on the fifth Business Day
preceding the relevant Dividend Payment Date and shall give notice on or prior
to the record date of the form of payment of such dividend. Accrued and unpaid
dividends for any past Dividend Payment Date may be declared and paid at any
time, without reference to any Dividend Payment Date, to holders of record on
such record date, not more than 45 days nor less than five Business Days
preceding the payment date thereof, as may be fixed by the Board of Directors.
(1) For the purpose of determining the number of Additional Preferred to be
issued pursuant to paragraph (4)(a), each such Additional Preferred shall
be valued at $1,000.00. Holders of such Additional Preferred shall be
entitled to receive dividends payable at the rates specified in paragraph
(4)(a).
(1)
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(2) The dividends payable for the initial Dividend Period, or any other period
shorter than a full Dividend Period, on the 5-1/4% Preferred Stock shall
accrue daily and be computed on the basis of a 360-day year and the actual
number of days in such period. Holders of shares of 5-1/4% Preferred Stock
shall not be entitled to any dividends, whether payable in cash, property
or stock, in excess of cumulative dividends, as herein provided, on the
5-1/4% Preferred Stock except as otherwise provided herein. No interest,
or sum of money in lieu of interest, shall be payable in respect of any
dividend payment or payments on the 5-1/4% Preferred Stock that may be in
arrears except as otherwise provided herein.
(3) So long as any shares of the 5-1/4% Preferred Stock are outstanding, no
dividends, except as described in the next succeeding sentence, shall be
declared or paid or set apart for payment on Parity Securities, for any
period, nor shall any Parity Securities be redeemed, purchased or
otherwise acquired for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any such Parity
Securities) by the Corporation (except for conversion into or exchange
into other Parity Securities) unless, in each case, (i) full cumulative
dividends on all outstanding shares of the 5-1/4% Preferred Stock for all
Dividend Periods terminating on or prior to the date of such redemption,
repurchase or other acquisition shall have been paid or set apart for
payment, (ii) sufficient funds shall have been paid or set apart for the
payment of the dividend for the current Dividend Period with respect to
the 5-1/4% Preferred Stock and (iii) the Corporation is not in default
with respect to any redemption of shares of 5-1/4% Preferred Stock by the
Corporation pursuant to paragraph (6) below. When dividends are not fully
paid in Common Stock or Additional Preferred or are not paid in full in
cash or a sum sufficient for such payment is not set apart, as aforesaid,
all dividends declared upon shares of the 5-1/4% Preferred Stock and all
dividends declared upon Parity Securities shall be declared ratably in
proportion to the respective amounts of dividends accumulated and unpaid
on the 5-1/4% Preferred Stock and accumulated and unpaid on such Parity
Securities.
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(4) So long as any shares of the 5-1/4% Preferred Stock are outstanding, no
dividends (other than (i) any rights issued pursuant to a shareholder
rights plan as provided in paragraph 11 and (ii) dividends or
distributions paid in shares of, or options, warrants or rights to
subscribe for or purchase shares of, Junior Securities) shall be declared
or paid or set apart for payment or other distribution declared or made
upon Junior Securities, nor shall any Junior Securities be redeemed,
purchased or otherwise acquired (other than a redemption, purchase or
other acquisition of shares of Common Stock made for purposes of an
employee incentive or benefit plan of the Corporation or any subsidiary)
(all such dividends, distributions, redemptions or purchases being
hereinafter referred to as "Junior Securities Distributions") for any
consideration (or any moneys be paid to or made available for a sinking
fund for the redemption of any shares of any such stock) by the
Corporation, directly or indirectly (except by conversion into or exchange
for Junior Securities, including pursuant to paragraph 4(c) of the Series
A Preferred and paragraph 4(d) of the Series B Preferred), unless in each
case (i) the full cumulative dividends on all outstanding shares of the
5-1/4% Preferred Stock and any other Parity Securities shall have been
paid or set apart for payment for all past Dividend Periods with respect
to the 5-1/4% Preferred Stock and all past dividend periods with respect
to such Parity Securities and (ii) sufficient funds shall have been paid
or set apart for the payment of the dividend for the current Dividend
Period with respect to the 5-1/4% Preferred Stock and the current dividend
period with respect to such Parity Securities.
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(5) Liquidation Preference. (a) In the event of any liquidation, dissolution or
winding up of the Corporation, whether voluntary or involuntary, before any
payment or distribution of the assets of the Corporation (whether capital or
surplus) shall be made to or set apart for the holders of Junior Securities, the
holders of the shares of 5-1/4% Preferred Stock shall be entitled to receive
$1,000.00 per share of 5-1/4% Preferred Stock plus an amount equal to all
dividends (whether or not earned or declared) accrued and unpaid thereon to the
date of final distribution to such holders; but such holders shall not be
entitled to any further payment. If, upon any liquidation, dissolution or
winding up of the Corporation, the assets of the Corporation, or proceeds
thereof, distributable among the holders of the shares of 5-1/4% Preferred Stock
shall be insufficient to pay in full the preferential amount aforesaid and
liquidating payments on any Parity Securities, then such assets, or the proceeds
thereof, shall be distributed among the holders of shares of 5-1/4% Preferred
Stock and any such other Parity Securities ratably in accordance with the
respective amounts that would be payable on such shares of 5-1/4% Preferred
Stock and any such other stock if all amounts payable thereon were paid in full.
For the purposes of this paragraph (5), (i) a consolidation or merger of the
Corporation with one or more corporations, or (ii) a sale or transfer of all or
substantially all of the Corporation's assets, shall not be deemed to be a
liquidation, dissolution or winding up, voluntary or involuntary, of the
Corporation.
(1) Subject to the rights of the holders of any Parity Securities,
upon any liquidation, dissolution or winding up of the Corporation, after
payment shall have been made in full to the holders of the 5-1/4% Preferred
Stock, as provided in this paragraph (5), any other series or class or
classes of Junior Securities shall, subject to the respective terms and
provisions (if any) applying thereto, be entitled to receive any and all
assets remaining to be paid or distributed, and the holders of the 5-1/4%
Preferred Stock shall not be entitled to share therein.
(6) Redemption. (a) On and after the earlier to occur of (i) the seventh
anniversary of the Issue Date or (ii) the date on which the Current Market Price
of the Common Stock shall have exceeded $120.00 for twenty-five (25) consecutive
Trading Days, to the extent the Corporation shall have funds legally available
for such payment, the Corporation may redeem at its option shares of 5-1/4%
Preferred Stock, in whole or from time to time in part, payable at the option of
the Corporation in (A) cash, at a redemption price of $1,000.00 per share, or
(B) in shares of Common Stock, at a redemption price of $1,025.00 per share in
the case of a redemption permitted by clause (i) or $1,000.00 per share in the
case of a redemption permitted by clause (ii), or (C) in a combination of cash
and Common Stock at a redemption price based on the respective combination of
consideration, together in each case with accrued and unpaid dividends thereon,
whether or not declared, to, but excluding, the date fixed for redemption,
without interest. For purposes of determining the number of shares of the Common
Stock to be issued pursuant to this paragraph (6)(a), the price per share of
Common Stock valued at the Fair Market Value.
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(1) On and after January 28, 2009, each holder of shares of 5-1/4% Preferred
Stock shall have the right to require the Corporation, to the extent the
Corporation shall have funds legally available therefor, to redeem such
holder's shares of 5-1/4% Preferred Stock in whole or from time to time in
part at a redemption price of $1,000.00 per share, payable at the option of
the Corporation in cash, shares of Common Stock or a combination thereof,
together with accrued and unpaid dividends thereon to, but excluding, the
date fixed for redemption, without interest. For purposes of determining
the number of shares of the Common Stock to be issued pursuant to this
paragraph (6)(b), the price per share of Common Stock shall equal the Fair
Market Value. Any holder of shares of 5-1/4% Preferred Stock who elects to
exercise its rights pursuant to this paragraph (6)(b) shall deliver to the
Corporation a written notice of election not less than 20 days prior to
January 28, 2009, as the case may be, which notice shall set forth the name
of the Holder, the number of shares of 5-1/4% Preferred Stock to be
redeemed and a statement that the election to exercise a redemption right
is being made thereby; and shall deliver to the Corporation on or before
the date of redemption certificates evidencing the shares of 5-1/4%
Preferred Stock to be redeemed, duly endorsed for transfer to the
Corporation.
(2) If the Corporation shall not have redeemed all outstanding shares of
5-1/4% Preferred Stock pursuant to paragraphs (6)(a) and (6)(b), on the
twentieth anniversary of the Issue Date (the "Mandatory Redemption Date"),
to the extent the Corporation shall have funds legally available for such
payment, the Corporation shall redeem all outstanding shares of 5-1/4%
Preferred Stock, at a redemption price of $1,000.00 per share, payable at
the option of the Corporation in cash, shares of Common Stock or a
combination thereof, together with accrued and unpaid dividends thereon to,
but excluding, the Mandatory Redemption Date, without interest. For
purposes of determining the number of shares of the Common Stock to be
issued pursuant to this paragraph (6)(c), the price per share of Common
Stock shall be valued at the Fair Market Value.
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(3) If the Corporation is unable or shall fail to discharge its obligation to
redeem all outstanding shares of 5-1/4% Preferred Stock pursuant to
paragraph (6)(c) (the "Mandatory Redemption Obligation"), the Mandatory
Redemption Obligation shall be discharged as soon as the Corporation is
able to discharge such Mandatory Redemption Obligation. If and so long as
any Mandatory Redemption Obligation with respect to the 5-1/4% Preferred
Stock shall not be fully discharged, the Corporation shall not (i)
directly or indirectly, redeem, purchase, or otherwise acquire any Parity
Security or discharge any mandatory or optional redemption, sinking fund
or other similar obligation in respect of any Parity Securities (except in
connection with a redemption, sinking fund or other similar obligation to
be satisfied pro rata with the 5-1/4% Preferred Stock) or (ii) declare or
make any Junior Securities Distribution (other than dividends or
distributions paid in shares of, or options, warrants or rights to
subscribe for or purchase shares of, Junior Securities), or, directly or
indirectly, discharge any mandatory or optional redemption, sinking fund
or other similar obligation in respect of the Junior Securities.
(4) Upon any redemption of 5-1/4% Preferred Stock, the Corporation shall pay
the redemption price and any accrued and unpaid dividends in arrears to,
but excluding, the applicable redemption date.
(5) For purposes of paragraph (6)(a) only, unless full cumulative dividends
(whether or not declared) on all outstanding shares of 5-1/4% Preferred
Stock and any Parity Securities shall have been paid or contemporaneously
are declared and paid or set apart for payment for all Dividend Periods
terminating on or prior to the applicable redemption date, none of the
shares of 5-1/4% Preferred Stock shall be redeemed, and no sum shall be
set aside for such redemption, unless shares of 5-1/4% Preferred Stock are
redeemed pro rata.
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(7) Procedure for Redemption. (a) If the Corporation shall redeem shares of
5-1/4% Preferred Stock pursuant to paragraph 6(a), notice of such redemption
shall be given by certified mail, return receipt requested, postage prepaid,
mailed not less than 30 days nor more than 60 days prior to the redemption date,
to each holder of record of the shares to be redeemed at such holder's address
as the same appears on the stock register of the Corporation and confirmed by
facsimile transmission to each holder of record if the Corporation has been
furnished with such facsimile address by the holder(s); provided that neither
the failure to give such notice nor confirmation nor any defect therein or in
the mailing thereof, to any particular holder, shall affect the sufficiency of
the notice or the validity of the proceedings for redemption with respect to the
other holders. Any notice that was mailed in the manner herein provided shall be
conclusively presumed to have been duly given on the date mailed whether or not
the holder receives the notice. Each such notice shall state: (i) the redemption
date; (ii) the number of shares of 5-1/4% Preferred Stock to be redeemed and, if
fewer than all the shares held by such holder are to be redeemed, the number of
shares to be redeemed from such holder; (iii) the amount payable, whether in
Common Stock or cash and if the payment is in Common Stock an explanation of the
determination of the amount to be paid; (iv) the place or places where
certificates for such shares are to be surrendered for payment of the redemption
price; and (v) that dividends on the shares to be redeemed will cease to accrue
on such redemption date, except as otherwise provided herein.
(1) If notice has been mailed as aforesaid, from and after the redemption date
(unless default shall be made by the Corporation in providing for the
payment of the redemption price of the shares called for redemption and
dividends accrued and unpaid thereon, if any), (i) except as otherwise
provided herein, dividends on the shares of 5-1/4% Preferred Stock so
called for redemption shall cease to accrue, (ii) said shares shall no
longer be deemed to be outstanding, and (iii) all rights of the holders
thereof as holders of the 5-1/4% Preferred Stock shall cease (except the
right to receive from the Corporation the redemption price without
interest thereon, upon surrender and endorsement of their certificates if
so required, and to receive any dividends payable thereon).
(2) Upon surrender in accordance with notice given pursuant to this paragraph
(7) of the certificates for any shares so redeemed (properly endorsed or
assigned for transfer, if the Board of Directors of the Corporation shall
so require and the notice shall so state), such shares shall be redeemed
by the Corporation at the redemption price aforesaid, plus any dividends
payable thereon. If fewer than all the outstanding shares of 5-1/4%
Preferred Stock are to be redeemed, the number of shares to be redeemed
shall be determined by the Board of Directors and the shares to be
redeemed shall be selected pro rata (with any fractional shares being
rounded to the nearest whole share). In case fewer than all the shares
represented by any such certificate are redeemed, a new certificate shall
be issued representing the unredeemed shares without cost to the holder
thereof.
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(8) Conversion. (a) Subject to and upon compliance with the provisions of this
paragraph (8), a holder of shares of 5-1/4% Preferred Stock shall have the
right, at any time and from time to time, at such holder's option, to convert
any or all outstanding shares of 5-1/4% Preferred Stock held by such holder, but
not fractions of shares, into fully paid and non-assessable shares of Common
Stock by surrendering such shares to be converted, such surrender to be made in
the manner provided in paragraph (8)(b) hereof. The number of shares of Common
Stock deliverable upon conversion of each share of 5-1/4% Preferred Stock shall
be equal to $1,000.00 divided by 10.00 (as adjusted as provided herein, the
"Conversion Rate"); provided that the aggregate number of shares of Common Stock
deliverable upon conversion of the 5-1/4% Preferred Stock (together with the
conversion of any Additional Preferred) shall not be greater than 7,590,994
subject to adjustment as provided herein. The Conversion Rate is subject to
adjustment from time to time pursuant to paragraph (8)(d) hereof. The right to
convert shares called for redemption pursuant to paragraph (7) shall terminate
at the close of business on the date immediately preceding the date fixed for
such redemption unless the Corporation shall default in making payment of the
amount payable upon such redemption. Upon conversion of any share of 5-1/4%
Preferred Stock the holder thereof shall continue to be entitled to receive from
the Corporation any accrued but unpaid dividends thereon.
(1) (i) In order to exercise the conversion privilege, the holder of each
share of 5-1/4% Preferred Stock to be converted shall surrender the
certificate representing such share, duly endorsed or assigned to the
Corporation or in blank, at the office of the Corporation, or to any
transfer agent of the Corporation previously designated by the Corporation
to the holders of the 5-1/4% Preferred Stock for such purposes, with a
written notice of election to convert completed and signed, specifying the
number of shares to be converted. Such notice shall state that the holder
has satisfied any legal or regulatory requirement for conversion,
including compliance with the Hart-Scott-Rodino Antitrust Improvements Act
of 1976. Such notice shall also state the name or names (with address and
social security or other taxpayer identification number) in which the
certificate or certificates for Common Stock are to be issued. Unless the
shares issuable on conversion are to be issued in the same name as the
name in which such share of 5-1/4% Preferred Stock is registered, each
share surrendered for conversion shall be accompanied by instruments of
transfer, in form satisfactory to the Corporation, duly executed by the
holder or the holder's duly authorized attorney and an amount sufficient
to pay any transfer or similar tax (or evidence reasonably satisfactory to
the Corporation demonstrating that such taxes have been paid). All
certificates representing shares of 5-1/4% Preferred Stock surrendered for
conversion shall be canceled by the Corporation or the transfer agent. (1)
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(1) Holders of shares of 5-1/4% Preferred Stock at the close of business on a
dividend payment record date shall not be entitled to receive the dividend
payable on such shares on the corresponding Dividend Payment Date if such
holder shall have surrendered for conversion such shares at any time
following the preceding Dividend Payment Date and prior to such Dividend
Payment Date.
(2) As promptly as practicable after the surrender by a holder of the
certificates for shares of 5-1/4% Preferred Stock as aforesaid, the
Corporation shall issue and shall deliver to such holder, or on the
holder's written order, a certificate or certificates (which certificate
or certificates shall have the legend set forth in paragraph 10(c)) for
the whole number of duly authorized, validly issued, fully paid and
non-assessable shares of Common Stock issuable upon the conversion of such
shares in accordance with the provisions of this paragraph (8), and any
fractional interest in respect of a share of Common Stock arising on such
conversion shall be settled as provided in paragraph (8)(c). Upon
conversion of only a portion of the shares of 5-1/4% Preferred Stock
represented by any certificate, a new certificate shall be issued
representing the unconverted portion of the certificate so surrendered
without cost to the holder thereof. Upon the surrender of certificates
representing shares of 5-1/4% Preferred Stock to be converted, such shares
shall no longer be deemed to be outstanding and all rights of a holder
with respect to such shares surrendered for conversion shall immediately
terminate except the right to receive the Common Stock and other amounts
payable pursuant to this paragraph (8).
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(3) Each conversion shall be deemed to have been effected immediately prior
to the close of business on the date on which the certificates for shares
of 5-1/4% Preferred Stock shall have been surrendered and such notice
received by the Corporation as aforesaid, and the Person or Persons in
whose name or names any certificate or certificates for shares of Common
Stock shall be issuable upon such conversion shall be deemed to have
become the holder or holders of record of the shares of Common Stock
represented thereby at such time on such date and such conversion shall be
into a number of shares of Common Stock equal to the product of the number
of shares of 5-1/4% Preferred Stock surrendered times the Conversion Rate
in effect at such time on such date, unless the stock transfer books of
the Corporation shall be closed on that date, in which event such Person
or Persons shall be deemed to have become such holder or holders of record
at the close of business on the next succeeding day on which such stock
transfer books are open, but such conversion shall be based upon the
Conversion Rate in effect on the date upon which such shares shall have
been surrendered and such notice received by the Corporation.
(2) No fractional shares or scrip representing fractions of shares of Common
Stock shall be issued upon conversion of the 5-1/4% Preferred Stock.
Instead of any fractional interest in a share of Common Stock that would
otherwise be deliverable upon the conversion of a share of 5-1/4%
Preferred Stock, the Corporation shall pay to the holder of such share an
amount in cash based upon the Current Market Price of Common Stock on the
Trading Day immediately preceding the date of conversion. If more than one
share shall be surrendered for conversion 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 of 5-1/4%
Preferred Stock surrendered for conversion by such holder.
(3) The Conversion Rate shall be adjusted from time to time as follows:
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(1) If the Corporation shall after the Issue Date (A) declare a dividend or
make a distribution on its Common Stock in shares of its Common Stock, (B)
subdivide its outstanding Common Stock into a greater number of shares or
(C) combine its outstanding Common Stock into a smaller number of shares,
the Conversion Rate in effect on the record date for such dividend or
distribution, or the effective date of such subdivision or combination, as
the case may be, shall be proportionately adjusted so that the holder of
any share of 5-1/4% Preferred Stock thereafter surrendered for conversion
shall be entitled to receive the number and kind of shares of Common Stock
that such holder would have owned or have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the record date in the case of a dividend
or distribution or the effective date in the case of a subdivision or
combination. An adjustment made pursuant to this subparagraph (i) shall
become effective immediately after the opening of business on the Business
Day next following the record date (except as provided in paragraph
(8)(h)) in the case of a dividend or distribution and shall become
effective immediately after the opening of business on the Business Day
next following the effective date in the case of a subdivision,
combination or reclassification. Adjustments in accordance with this
paragraph (8)(d)(i) shall be made whenever any event listed above shall
occur.
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(2) If the Corporation shall after the Issue Date fix a record date for the
issuance of rights or warrants (in each case, other than any rights issued
pursuant to a shareholder rights plan) to all holders of Common Stock
entitling them (for a period expiring within 45 days after such record
date) to subscribe for or purchase Common Stock (or securities convertible
into Common Stock) at a price per share (or, in the case of a right or
warrant to purchase securities convertible into Common Stock, having an
effective exercise price per share of Common Stock, computed on the basis
of the maximum number of shares of Common Stock issuable upon conversion
of such convertible securities, plus the amount of additional
consideration payable, if any, to receive one share of Common Stock upon
conversion of such securities) less than the Fair Market Value per share
of Common Stock on the date on which such issuance was declared or
otherwise announced by the Corporation (the "Determination Date"), then
the Conversion Rate in effect at the opening of business on the Business
Day next following such record date shall be adjusted so that the holder
of each share of 5-1/4% Preferred Stock shall be entitled to receive, upon
the conversion thereof, the number of shares of Common Stock determined by
multiplying (I) the Conversion Rate in effect immediately prior to such
record date by (II) a fraction, the numerator of which shall be the sum of
(A) the number of shares of Common Stock outstanding on the close of
business on the Determination Date and (B) the number of additional shares
of Common Stock offered for subscription or purchase pursuant to such
rights or warrants (or in the case of a right or warrant to purchase
securities convertible into Common Stock, the aggregate number of
additional shares of Common Stock into which the convertible securities so
offered are initially convertible), and the denominator of which shall be
the sum of (A) the number of shares of Common Stock outstanding on the
close of business on the Determination Date and (B) the number of shares
that the aggregate proceeds to the Corporation from the exercise of such
rights or warrants for Common Stock would purchase at such Fair Market
Value on such date (or, in the case of a right or warrant to purchase
securities convertible into Common Stock, the number of shares of Common
Stock obtained by dividing the aggregate exercise price of such rights or
warrants for the maximum number of shares of Common Stock issuable upon
conversion of such convertible securities, plus the aggregate amount of
additional consideration payable, if any, to convert such securities into
Common Stock, by such Fair Market Value). Such adjustment shall become
effective immediately after the opening of business on the Business Day
next following such record date (except as provided in paragraph (8)(h)).
Such adjustment shall be made successively whenever such a record date is
fixed. In the event that after fixing a record date such rights or
warrants are not so issued, the Conversion Rate shall be readjusted to the
Conversion Rate which would then be in effect if such record date had not
been fixed. In determining whether any rights or warrants entitle the
holders of Common Stock to subscribe for or purchase shares of Common
Stock at less than such Fair Market Value, there shall be taken into
account any consideration received by the Corporation upon issuance and
upon exercise of such rights or warrants, the value of such consideration,
if other than cash, to be determined by the Board of Directors in good
faith. In case any rights or warrants referred to in this subparagraph
(ii) shall expire unexercised after the same shall have been distributed
or issued by the Corporation (or, in the case of rights or warrants to
purchase securities convertible into Common Stock once exercised, the
conversion right of such securities shall expire), the Conversion Rate
shall be readjusted at the time of such expiration to the Conversion Rate
that would have been in effect if no adjustment had been made on account
of the distribution or issuance of such expired rights or warrants.
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(3) If the Corporation shall fix a record date for the making of a
distribution to all holders of its Common Stock of evidences of its
indebtedness, shares of its capital stock or assets (excluding regular
cash dividends or distributions declared in the ordinary course by the
Board of Directors and dividends payable in Common Stock for which an
adjustment is made pursuant to paragraph (8)(d)(i)) or rights or warrants
(in each case, other than any rights issued pursuant to a shareholder
rights plan) to subscribe for or purchase any of its securities (excluding
those rights and warrants issued to all holders of Common Stock entitling
them for a period expiring within 45 days after the record date referred
to in subparagraph (ii) above to subscribe for or purchase Common Stock or
securities convertible into shares of Common Stock, which rights and
warrants are referred to in and treated under subparagraph (ii) above)
(any of the foregoing being hereinafter in this subparagraph (iii) called
the "Securities"), then in each such case the Conversion Rate shall be
adjusted so that the holder of each share of 5-1/4% Preferred Stock shall
be entitled to receive, upon the conversion thereof, the number of shares
of Common Stock determined by multiplying (I) the Conversion Rate in
effect immediately prior to the close of business on such record date by
(II) a fraction, the numerator of which shall be the Fair Market Value per
share of the Common Stock on such record date, and the denominator of
which shall be the Fair Market Value per share of the Common Stock on such
record date less the then-fair market value (as determined by the Board of
Directors in good faith, whose determination shall be conclusive) of the
portion of the assets, shares of its capital stock or evidences of
indebtedness so distributed or of such rights or warrants applicable to
one share of Common Stock. Such adjustment shall be made successively
whenever such a record date is fixed; and in the event that after fixing a
record date such distribution is not so made, the Conversion Rate shall be
readjusted to the Conversion Rate which would then be in effect if such
record date had not been fixed. Such adjustment shall become effective
immediately at the opening of business on the Business Day next following
(except as provided in paragraph (8)(h)) the record date for the
determination of shareholders entitled to receive such distribution. For
the purposes of this subparagraph (iii), the distribution of a Security,
which is distributed not only to the holders of the Common Stock on the
date fixed for the determination of shareholders entitled to such
distribution of such Security, but also is distributed with each share of
Common Stock delivered to a Person converting a share of 5-1/4% Preferred
Stock after such determination date, shall not require an adjustment of
the Conversion Rate pursuant to this subparagraph (iii); provided that on
the date, if any, on which a Person converting a share of 5-1/4% Preferred
Stock would no longer be entitled to receive such Security with a share of
Common Stock (other than as a result of the termination of all such
Securities), a distribution of such Securities shall be deemed to have
occurred and the Conversion Rate shall be adjusted as provided in this
subparagraph (iii) (and such day shall be deemed to be "the date fixed for
the determination of shareholders entitled to receive such distribution"
and "the record date" within the meaning of the three preceding
sentences). If any rights or warrants referred to in this subparagraph
(iii) shall expire unexercised after the same shall have been distributed
or issued by the Corporation, the Conversion Rate shall be readjusted at
the time of such expiration to the Conversion Rate that would have been in
effect if no adjustment had been made on account of the distribution or
issuance of such expired rights or warrants.
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(4) In case the Corporation shall, by dividend or otherwise, distribute to
all holders of its Common Stock cash in an amount per share that, together
with the aggregate of the per share amounts of any other cash
distributions to all holders of its Common Stock made within the 12 months
preceding the date of payment of such distribution and in respect of which
no adjustment pursuant to this paragraph (iv) has been made exceeds 5.0%
of the Fair Market Value immediately prior to the date of declaration of
such dividend or distribution (excluding any dividend or distribution in
connection with the liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, and any cash that is
distributed upon a merger, consolidation or other transaction for which an
adjustment pursuant to paragraph 8(e) is made), then, in such case, the
Conversion Rate shall be adjusted so that the same shall equal the rate
determined by multiplying the Conversion Rate in effect immediately prior
to the close of business on the Record Date for the cash dividend or
distribution by a fraction the numerator of which shall be the Current
Market Price of a share of the Common Stock on the Record Date and the
denominator shall be such Current Market Price less the per share amount
of cash so distributed during the 12-month period applicable to one share
of Common Stock, such adjustment to be effective immediately prior to the
opening of business on the Business Day following the Record Date;
provided, however, that in the event the denominator of the foregoing
fraction is zero or negative, in lieu of the foregoing adjustment,
adequate provision shall be made so that each holder of 5-1/4% Preferred
Stock shall have the right to receive upon conversion, in addition to the
shares of Common Stock to which the holder is entitled, the amount of cash
such holder would have received had such holder converted each share of
5-1/4% Preferred Stock at the beginning of the 12-month period. In the
event that such dividend or distribution is not so paid or made, the
Conversion Rate shall again be adjusted to be the Conversion Rate which
would then be in effect if such dividend or distribution had not been
declared. Notwithstanding the foregoing, if any adjustment is required to
be made as set forth in this paragraph (8)(d)(iv), the calculation of any
such adjustment shall include the amount of the quarterly cash dividends
paid during the 12-month reference period only to the extent such
dividends exceed the regular quarterly cash dividends paid during the 12
months preceding the 12-month reference period. For purposes of this
paragraph (8)(d)(iv), "Record Date" shall mean, with respect to any
dividend or distribution in which the holders of Common Stock have the
right to receive cash, the date fixed for determination of shareholders
entitled to receive such cash.
In the event that at any time cash distributions to holders of Common
Stock are not paid equally on all series of Common Stock, the provisions
of this paragraph 8(d)(iv) will apply to any cash dividend or cash
distribution on any series of Common Stock otherwise meeting the
requirements of this paragraph, and shall be deemed amended to the extent
necessary so that any adjustment required will be made on the basis of the
cash dividend or cash distribution made on any such series.
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(5) In case of the consummation of a tender or exchange offer (other than an
odd-lot tender offer) made by the Corporation or any subsidiary of the
Corporation for all or any portion of the outstanding shares of Common
Stock to the extent that the cash and fair market value (as determined in
good faith by the Board of Directors of the Corporation, whose
determination shall be conclusive and shall be described in a resolution
of such Board) of any other consideration included in such payment per
share of Common Stock at the last time (the "Expiration Time") tenders or
exchanges may be made pursuant to such tender or exchange offer (as
amended) exceed by more than 5.0%, with any smaller excess being
disregarded in computing the adjustment to the Conversion Rate provided in
this paragraph (8)(d)(v), the first reported sale price per share of
Common Stock on the Trading Day next succeeding the Expiration Time, then
the Conversion Rate shall be adjusted so that the same shall equal the
rate determined by multiplying the Conversion Rate in effect immediately
prior to the Expiration Time by a fraction the numerator of which shall be
the sum of (x) the fair market value (determined as aforesaid) of the
aggregate consideration payable to shareholders based on the acceptance
(up to any maximum specified in the terms of the tender or exchange offer)
of all shares validly tendered or exchanged and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such maximum,
being referred to as the "Purchased Shares") and (y) the product of the
number of shares of Common Stock outstanding (less any Purchased Shares)
on the Expiration Time and the first reported sale price of the Common
Stock on the Trading Day next succeeding the Expiration Time, and the
denominator of which shall be the number of shares of Common Stock
outstanding (including any tendered or exchanged shares) on the Expiration
Time multiplied by the first reported sale price of the Common Stock on
the Trading Day next succeeding the Expiration Time, such adjustment to
become effective immediately prior to the opening of business on the day
following the Expiration Time.
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(6) No adjustment in the Conversion Rate shall be required unless such
adjustment would require a cumulative increase or decrease of at least 1%
in the Conversion Rate; provided, however, that any adjustments that by
reason of this subparagraph (vi) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment until
made; and provided, further, that any adjustment shall be required and
made in accordance with the provisions of this paragraph (8) (other than
this subparagraph (vi)) not later than such time as may be required in
order to preserve the tax-free nature of a distribution for United States
income tax purposes to the holders of shares of 5-1/4% Preferred Stock or
Common Stock. Notwithstanding any other provisions of this paragraph (8),
the Corporation shall not be required to make any adjustment of the
Conversion Rate for the issuance of any shares of Common Stock pursuant to
any plan providing for the reinvestment of dividends or interest payable
on securities of the Corporation and the investment of additional optional
amounts in shares of Common Stock under such plan. All calculations under
this paragraph (8) shall be made to the nearest dollar or to the nearest
1/1,000 of a share, as the case may be. Anything in this paragraph (8)(d)
to the contrary notwithstanding, the Corporation shall be entitled, to the
extent permitted by law, to make such adjustments in the Conversion Rate,
in addition to those required by this paragraph (8)(d), as it in its
discretion shall determine to be advisable in order that any stock
dividends, subdivision of shares, reclassification or combination of
shares, distribution of rights or warrants to purchase stock or
securities, or a distribution of other assets (other than cash dividends)
hereafter made by the Corporation to its shareholders shall not be
taxable.
(7) In the event that, at any time as a result of shares of any other class of
capital stock becoming issuable in exchange or substitution for or in lieu
of shares of Common Stock or as a result of an adjustment made pursuant to
the provisions of this paragraph (8)(d), the holder of 5-1/4% Preferred
Stock upon subsequent conversion shall become entitled to receive any
shares of capital stock of the Corporation other than Common Stock, the
number of such other shares so receivable upon conversion of any shares of
5-1/4% Preferred Stock shall thereafter be subject to adjustment from time
to time in a manner and on terms as nearly equivalent as practicable to
the provisions contained herein.
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(4) (i) If the Corporation shall be a party to any transaction (including,
without limitation, a merger, consolidation, sale of all or substantially
all of the Corporation's assets or recapitalization of the Common Stock
and excluding any transaction as to which paragraph (8)(d)(i) applies)
(each of the foregoing being referred to herein as a "Transaction"), in
each case as a result of which shares of Common Stock shall be converted
into the right to receive stock, securities or other property (including
cash or any combination thereof), there shall be no adjustment to the
Conversion Rate but each share of 5-1/4% Preferred Stock which is not
converted into the right to receive stock, securities or other property in
connection with such Transaction shall thereafter be convertible into the
kind and amount of shares of stock, securities and other property
(including cash or any combination thereof) receivable upon the
consummation of such Transaction by a holder of that number of shares or
fraction thereof of Common Stock into which one share of 5-1/4% Preferred
Stock was convertible immediately prior to such Transaction, assuming such
holder of Common Stock (i) is not a Person with which the Corporation
consolidated or into which the Corporation merged or which merged into the
Corporation or to which such sale or transfer was made, as the case may be
("Constituent Person"), or an affiliate of a Constituent Person and (ii)
failed to exercise his rights of election, if any, as to the kind or
amount of stock, securities and other property (including cash) receivable
upon such Transaction (provided that if the kind or amount of stock,
securities and other property (including cash) receivable upon such
Transaction is not the same for each share of Common Stock of the
Corporation held immediately prior to such Transaction by other than a
Constituent Person or an affiliate thereof and in respect of which such
rights of election shall not have been exercised ("non-electing share"),
then for the purpose of this paragraph (8)(e) the kind and amount of
stock, securities and other property (including cash) receivable upon such
Transaction by each non-electing share shall be deemed to be the kind and
amount so receivable per share by a plurality of the non-electing shares).
The provisions of this paragraph (8)(e) shall similarly apply to
successive Transactions.
(1) Notwithstanding anything herein to the contrary, if the Company is
reorganized such that the Common Stock is exchanged for the common stock
of a new entity ("Holdco") whose common stock is traded on NASDAQ or
another recognized securities exchange, then the Company, by notice to the
holders of the 5-1/4% Preferred Stock but without any required consent on
their part, may cause the exchange of this 5-1/4% Preferred Stock for
preferred stock of Holdco having the same terms and conditions as set
forth herein, provided that where Holdco is not solely incorporated as a
Delaware company or where the Holdco share structure is not identical to
that of the Company, the rights attaching to the preferred stock of Holdco
may be adjusted so as to comply with the local law of the country of
incorporation of Holdco or the new share structure of Holdco subject to
such rights effectively giving the same economic rights as the 5-1/4%
Preferred Stock (ignoring for these purposes any resultant change in the
tax treatment for the holders of such stock).
(5) If:
(1) the Corporation shall declare a dividend (or any other
distribution) on the Common Stock; or
(2) the Corporation shall authorize the granting to the holders of the Common
Stock of rights or warrants to subscribe for or purchase any shares of any
class or any other rights or warrants; or
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(3) there shall be any subdivision, combination or reclassification of the
Common Stock or any consolidation or merger to which the Corporation is a
party and for which approval of any shareholders of the Corporation is
required, or the sale or transfer of all or substantially all of the
assets of the Corporation as an entirety; or
(4) there shall occur the voluntary or involuntary liquidation, dissolution or
winding up of the Corporation;
then the Corporation shall cause to be filed with any transfer agent designated
by the Corporation pursuant to paragraph (8)(b) and shall cause to be
mailed to the holders of shares of the 5-1/4% Preferred Stock at their
addresses as shown on the stock records of the Corporation, as promptly as
possible, but at least ten days prior to the applicable date hereinafter
specified, a notice stating (A) the date on which a record is to be taken
for the purpose of such dividend (or such other distribution) or rights or
warrants, 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 or warrants are to be determined or (B) the date on
which such subdivision, combination, reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution or winding up or other
action 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, if
any, deliverable upon such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution or winding
up. Failure to give or receive such notice or any defect therein shall not
affect the legality or validity of any distribution, right, warrant,
subdivision, combination, reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution, winding up or other action, or the
vote upon any of the foregoing.
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(6) Whenever the Conversion Rate is adjusted as herein provided, the
Corporation shall prepare an officer's certificate with respect to such
adjustment of the Conversion Rate setting forth the adjusted Conversion
Rate and the effective date of such adjustment and shall mail a copy of
such officer's certificate to the holder of each share of 5-1/4% Preferred
Stock at such holder's last address as shown on the stock records of the
Corporation. If the Corporation shall have designated a transfer agent
pursuant to paragraph (8)(b), it shall also promptly file with such
transfer agent an officer's certificate setting forth the Conversion Rate
after such adjustment and setting forth a brief statement of the facts
requiring such adjustment which certificate shall be conclusive evidence
of the correctness of such adjustment.
(7) In any case in which paragraph (8)(d) provides that an adjustment shall
become effective on the day next following a record date for an event, the
Corporation may defer until the occurrence of such event (i) issuing to
the holder of any share of 5-1/4% Preferred Stock converted after such
record date and before the occurrence of such event the additional shares
of Common Stock issuable upon such conversion by reason of the adjustment
required by such event over and above the Common Stock issuable upon such
conversion before giving effect to such adjustment and (ii) paying to such
holder any amount in cash in lieu of any fraction pursuant to paragraph
(8)(c).
(8) For purposes of this paragraph (8), the number of shares of Common Stock
at any time outstanding shall not include any shares of Common Stock then
owned or held by or for the account of the Corporation. The Corporation
shall not pay a dividend or make any distribution on shares of Common
Stock held in the treasury of the Corporation.
(9) There shall be no adjustment of the Conversion Rate in case of the
issuance of any stock of the Corporation in a reorganization, acquisition
or other similar transaction except as specifically set forth in this
paragraph (8). If any single action would require adjustment of the
Conversion Rate pursuant to more than one subparagraph of this paragraph
(8), only one adjustment shall be made and such adjustment shall be the
amount of adjustment that has the highest absolute value.
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(10) If the Corporation shall take any action affecting the Common Stock,
other than action described in this paragraph (8), that in the opinion of
the Board of Directors materially adversely affects the conversion rights
of the holders of the shares of 5-1/4% Preferred Stock, the Conversion
Rate may be adjusted, to the extent permitted by law, in such manner, if
any, and at such time, as the Board of Directors may determine to be
equitable in the circumstances; provided that the provisions of this
paragraph (8)(k) shall not affect any rights the holders of 5-1/4%
Preferred Stock may have at law or in equity.
(11) (i) The Corporation covenants that it will at all times reserve and keep
available, free from preemptive rights, out of the aggregate of its
authorized but unissued shares of Common Stock or its issued shares of
Common Stock held in its treasury, or both, for the purpose of effecting
conversion of the 5-1/4% Preferred Stock, the full number of shares of
Common Stock deliverable upon the conversion of all outstanding shares of
5-1/4% Preferred Stock not theretofore converted. For purposes of this
paragraph (8)(1) the number of shares of Common Stock that shall be
deliverable upon the conversion of all outstanding shares of 5-1/4%
Preferred Stock shall be computed as if at the time of computation all
such outstanding shares were held by a single holder.
(1) The Corporation covenants that any shares of Common Stock issued upon
conversion of the 5-1/4% Preferred Stock shall be duly authorized, validly
issued, fully paid and non-assessable. Before taking any action that would
cause an adjustment increasing the Conversion Rate such that the quotient
of $1,000.00 and the Conversion Rate (which initially shall be $100.00)
would be reduced below the then-par value of the shares of Common Stock
deliverable upon conversion of the 5-1/4% Preferred Stock, the Corporation
will take any corporate action that, in the opinion of its counsel, may be
necessary in order that the Corporation may validly and legally issue
fully paid and non-assessable shares of Common Stock based upon such
adjusted Conversion Rate.
(2) Prior to the delivery of any securities that the Corporation shall be
obligated to deliver upon conversion of the 5-1/4% Preferred Stock, the
Corporation shall comply with all applicable federal and state laws and
regulations which require action to be taken by the Corporation.
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(12) The Corporation will pay any and all documentary stamp or similar issue or
transfer taxes payable in respect of the issue or delivery of shares of
Common Stock or other securities or property on conversion of the 5-1/4%
Preferred Stock pursuant hereto; provided, however, that the Corporation
shall not be required to pay any tax that may be payable in respect of any
transfer involved in the issue or delivery of shares of Common Stock or
other securities or property in a name other than that of the holder of
the 5-1/4% Preferred Stock to be converted and no such issue or delivery
shall be made unless and until the Person requesting such issue or
delivery has paid to the Corporation the amount of any such tax or
established, to the satisfaction of the Corporation, that such tax has
been paid.
(9) Voting Rights. (a) The holders of record of shares of 5-1/4% Preferred Stock
shall not be entitled to any voting rights except as hereinafter provided in
paragraph (b) or as otherwise provided by law.
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(1) If and whenever six quarterly dividends (whether or not consecutive)
payable on the 5-1/4% Preferred Stock have not been paid in full or if the
Corporation shall have failed to discharge its Mandatory Redemption
Obligation, the number of directors then constituting the Board of
Directors shall be increased by two and the holders of shares of 5-1/4%
Preferred Stock, together with the holders of shares of every other series
of preferred stock (including, without limitation, Additional Preferred)
upon which like rights to vote for the election of two additional
directors have been conferred and are exercisable (resulting from either
the failure to pay dividends or the failure to redeem) (any such other
series is referred to as the "Preferred Shares"), voting as a single class
regardless of series, shall be entitled to elect the two additional
directors to serve on the Board of Directors at any annual meeting of
stockholders or special meeting held in place thereof, or at a special
meeting of the holders of the 5-1/4% Preferred Stock and the Preferred
Shares called as hereinafter provided. Whenever all arrears in dividends
on the 5-1/4% Preferred Stock and the Preferred Shares then outstanding
shall have been paid and dividends thereon for the current quarterly
dividend period shall have been paid or declared and set apart for
payment, or the Corporation shall have fulfilled its Mandatory Redemption
Obligation and any redemption obligation in respect of the Preferred
Shares, as the case may be, then the right of the holders of the 5-1/4%
Preferred Stock and the Preferred Shares to elect such additional two
directors shall cease (but subject always to the same provisions for the
vesting of such voting rights in the case of any similar future arrearages
in six quarterly dividends or failure to fulfill any Mandatory Redemption
Obligation), and the terms of office of all persons elected as directors
by the holders of the 5-1/4% Preferred Stock and the Preferred Shares
shall forthwith terminate and the number of the Board of Directors shall
be reduced accordingly. At any time after such voting power shall have
been so vested in the holders of shares of 5-1/4% Preferred Stock and the
Preferred Shares, the secretary of the Corporation may, and upon the
written request of any holder of 5-1/4% Preferred Stock (addressed to the
secretary at the principal office of the Corporation) shall, call a
special meeting of the holders of the 5-1/4% Preferred Stock and of the
Preferred Shares for the election of the two directors to be elected by
them as herein provided, such call to be made by notice similar to that
provided in the Bylaws of the Corporation for a special meeting of the
stockholders or as required by law. If any such special meeting required
to be called as above provided shall not be called by the secretary within
20 days after receipt of any such request, then any holder of shares of
5-1/4% Preferred Stock may call such meeting, upon the notice above
provided, and for that purpose shall have access to the stock books of the
Corporation. The directors elected at any such special meeting shall hold
office until the next annual meeting of the stockholders or special
meeting held in lieu thereof if such office shall not have previously
terminated as above provided. If any vacancy shall occur among the
directors elected by the holders of the 5-1/4% Preferred Stock and the
Preferred Shares, a successor shall be elected by the Board of Directors,
upon the nomination of the then-remaining director elected by the holders
of the 5-1/4% Preferred Stock and the Preferred Shares or the successor of
such remaining director, to serve until the next annual meeting of the
stockholders or special meeting held in place thereof if such office shall
not have previously terminated as provided above.
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(2) Without the written consent of the holders of at least 66-2/3% in
liquidation preference of the outstanding shares of 5-1/4% Preferred Stock
or the vote of holders of at least 66-2/3% in liquidation preference of
the outstanding shares of 5-1/4% Preferred Stock at a meeting of the
holders of 5-1/4% Preferred Stock called for such purpose, the Corporation
will not amend, alter or repeal any provision of the Certificate of
Incorporation (by merger or otherwise) so as to adversely affect the
preferences, rights or powers of the 5-1/4% Preferred Stock; provided that
any such amendment that changes the dividend payable on, the conversion
rate with respect to, or the liquidation preference of the 5-1/4%
Preferred Stock shall require the affirmative vote at a meeting of holders
of 5-1/4% Preferred Stock called for such purpose or written consent of
the holder of each share of 5-1/4% Preferred Stock.
(3) Without the written consent of the holders of at least 66-2/3% in
liquidation preference of the outstanding shares of 5-1/4% Preferred Stock
or the vote of holders of at least 66-2/3% in liquidation preference of the
outstanding shares of 5-1/4% Preferred Stock at a meeting of such holders
called for such purpose, the Corporation will not issue any additional
5-1/4% Preferred Stock or create, authorize or issue any Parity Securities
or Senior Securities or increase the authorized amount of any such other
class or series; provided that paragraph 9(d) shall not limit the right of
the Corporation to (i) issue Additional Preferred as dividends pursuant to
paragraph 4 or (ii) to issue Parity Securities or Senior Securities in
order to refinance, redeem or refund the 13% Preferred, provided that the
maximum accrual value (i.e., the sum of stated value and maximum amount
payable in kind over the term from issuance to first date of mandatory
redemption or redemption at the option of the holder) of such Parity
Securities may not exceed the maximum accrual value of the 13% Preferred.
(4) In exercising the voting rights set forth in this paragraph 9, each share
of 5-1/4% Preferred Stock shall have one vote per share, except that when
any other series of preferred stock shall have the right to vote with the
5-1/4% Preferred Stock as a single class on any matter, then the 5-1/4%
Preferred Stock and such other series shall have with respect to such
matters one vote per $1,000 of stated liquidation preference. Except as
otherwise required by applicable law or as set forth herein, the shares of
5-1/4% Preferred Stock shall not have any relative, participating,
optional or other special voting rights and powers and the consent of the
holders thereof shall not be required for the taking of any corporate
action.
(10) General Provisions. (a) The headings of the paragraphs, subparagraphs,
clauses and subclauses of this Statement of Designations are for convenience of
reference only and shall not define, limit or affect any of the provisions
hereof.
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(1) If the Corporation shall have failed to declare or pay dividends as
required pursuant to paragraph (4) hereof or shall have failed to
discharge any obligation to redeem shares of 5-1/4% Preferred Stock
pursuant to paragraph (6) hereof, the holders of shares of 5-1/4%
Preferred Stock shall be entitled to receive, in addition to all other
amounts required to be paid hereunder, when, as and if declared by the
Board of Directors, out of funds legally available for the payment of
dividends, cash dividends on the aggregate dividends which the Corporation
shall have failed to declare or pay or the redemption price, together with
accrued and unpaid dividends thereon, as the case may be, at a rate of 2%
per quarter, compounded quarterly, for the period during which the failure
to pay dividends or failure to discharge an obligation to redeem shares of
5-1/4% Preferred Stock shall continue.
(2) The shares of 5-1/4% Preferred Stock shall bear the following
legend:
THE SHARES OF PREFERRED STOCK REPRESENTED BY THIS
CERTIFICATE MAY NOT BE TRANSFERRED OTHER THAN TO AN
AFFILIATE OF THE HOLDER.
The shares of Common Stock issuable upon conversion of the 5-1/4%
Preferred Stock shall bear the following legend:
THE SHARES OF COMMON STOCK, PAR VALUE $.01, OF THE COMPANY (THE "COMMON
STOCK") REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD IN THE
UNITED STATES ABSENT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT") AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
APPLICABLE EXEMPTION FROM REGISTRATION REQUIREMENTS. THE SHARES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED PRIOR TO JANUARY
28, 2001 (OTHER THAN TO AN AFFILIATE OF THE HOLDER) AND THEREAFTER MAY
ONLY BE SOLD IN BROKERS TRANSACTIONS (AS DEFINED IN RULE 144 UNDER THE
ACT) OR TO PERSONS WHO, GIVING EFFECT TO THE SALE OF THE SHARES
REPRESENTED HEREBY, WILL NOT BE THE BENEFICIAL OWNER OF 5% OR MORE OF THE
COMMON STOCK.
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(11) Shareholder Rights Plan. The shares of 5-1/4% Preferred Stock shall be
entitled to the benefits of a number of rights issuable under the Rights
Agreement, dated as of October 13, 1993, between the Company and Continental
Stock Transfer & Trust Company or any successor plan of similar purpose and
effect ("Rights") equal to the number of shares of Common Stock then issuable
upon conversion of the 5-1/4% Preferred Stock at the prevailing Conversion Rate.
Any shares of Common Stock deliverable upon conversion of a share of 5-1/4%
Preferred Stock or upon payment of a dividend shall be accomplished by a Right.
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Exhibit E
5-1/4% CONVERTIBLE PREFERRED STOCK, SERIES B
(1) Number and Designation. 4,447.92 shares of the Preferred
Stock of the Corporation shall be designated as 5-1/4% Convertible Preferred
Stock, Series B (the "5-1/4% Preferred Stock") and no other shares of Preferred
Stock shall be designated as 5-1/4% Preferred Stock.
(2) Definitions. For purposes of the 5-1/4% Preferred
Stock, the following terms shall have the meanings indicated:
"Board of Directors" shall mean the board of directors of the
Corporation or the Executive Committee, if any, of such board of directors or
any other committee duly authorized by such board of directors to perform any of
its responsibilities with respect to the 5-1/4% Preferred Stock.
"Business Day" shall mean any day other than a Saturday,
Sunday or a day on which state or federally chartered banking institutions in
New York, New York are not required to be open.
"Common Stock" shall mean the Corporation's Common Stock, par
value $.01 per share.
"Constituent Person" shall have the meaning set forth in
paragraph (8)(e) hereof.
"Conversion Rate" shall have the meaning set forth in
paragraph (8)(a) hereof.
"Current Market Price" of publicly traded shares of Common
Stock or any other class of capital stock or other security of the Corporation
or any other issuer for any day shall mean (i) if the security is then listed or
admitted to trading on a national securities exchange in the United States, the
last reported sale price, regular way, for the security as reported in the
consolidated transaction or other reporting system for securities listed or
traded on such exchange, or (ii) if the security is quoted on the Nasdaq
National Market, the last reported sale price, regular way, for the security as
reported on such list, or (iii) if the security is not so admitted for trading
on any national securities exchange or the Nasdaq National Market, the average
of the last reported closing bid and asked prices reported by the Nasdaq as
furnished by any member in good standing of the National Association of
Securities Dealers, Inc., selected from time to time by the Company for that
purpose or as
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quoted by the National Quotation Bureau Incorporated. In the event that no such
quotation is available for such day, the Current Market Price shall be the
average of the quotations for the last five Trading Days for which a quotation
is available within the last 30 Trading Days prior to such day. In the event
that five such quotations are not available within such 30-Trading Day period,
the Board of Directors shall be entitled to determine the Current Market Price
on the basis of such quotations as it reasonably considers appropriate.
"Determination Date" shall have the meaning set forth in
paragraph (8)(d) hereof.
"Dividend Payment Date" shall mean September 30, December 30,
March 30 and June 30 of each year, commencing on June 30, 1999; provided,
however, that if any Dividend Payment Date falls on any day other than a
Business Day, the dividend payment due on such Dividend Payment Date shall be
paid on the Business Day immediately following such Dividend Payment Date.
"Dividend Periods" shall mean quarterly dividend periods
commencing on September 30, December 30, March 30 and June 30 of each year and
ending on and including the day preceding the first day of the next succeeding
Dividend Period.
"Fair Market Value" shall mean the average of the daily
Current Market Prices of a share of Common Stock for the 25 Trading Days
immediately prior to the date for which such value is to be computed.
"5-1/4% Preferred Stock" shall have the meaning set forth in
paragraph (1) hereof.
"Issue Date" shall mean the first date on which shares of
5-1/4% Preferred Stock are issued.
"Junior Securities" shall have the meaning set forth in
paragraph (3) hereof.
"Junior Securities Distribution" shall have the meaning set
forth in paragraph (4)(e) hereof.
"Mandatory Redemption Date" shall have the meaning set forth
in paragraph (6)(c) hereof.
"Mandatory Redemption Obligation" shall have the meaning set
forth in paragraph (6)(d) hereof.
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"Nasdaq" means the National Association of Securities Dealers,
Inc. Automated Quotations System.
"non-electing share" shall have the meaning set forth in
paragraph (8)(e) hereof.
"NYSE" means the New York Stock Exchange.
"outstanding", when used with reference to shares of stock,
shall mean issued shares, excluding shares held by the Corporation or a
subsidiary.
"Parity Securities" shall have the meaning set forth in
paragraph (3) hereof.
"Person" shall mean any individual, a corporation, a
partnership, an association, a joint-stock company, a limited liability company,
a trust, any unincorporated organization, or a government or political
subdivision thereof.
"Preferred Stock" shall have the meaning set forth in the
first resolution above.
"Preferred Shares" has the meaning set forth in paragraph
(9)(b).
"Relevant Compounding Factor" shall mean, with respect to each
share of 5-1/4% Preferred Stock, upon initial issuance 1.00, and shall on each
Dividend Payment Date be increased to equal the product of the Relevant
Compounding Factor in effect immediately prior to such Dividend Payment Date and
1.013125.
"Securities" shall have the meaning set forth in paragraph
(8)(d) hereof.
"Senior Securities" shall have the meaning set forth in
paragraph (3) hereof.
"set apart for payment" shall be deemed to include, without
any action other than the following, the recording by the Corporation in its
accounting ledgers of any accounting or bookkeeping entry which indicates,
pursuant to a declaration of dividends or other distribution by the Board of
Directors, the allocation of funds to be so paid on any series or class of
capital stock of the Corporation; provided, however, that if any funds for any
class or series of Junior Securities or any class or series of Parity Securities
are placed in a separate account of the Corporation or delivered to a
disbursing, paying or other similar agent, then "set apart for payment"
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with respect to the 5-1/4% Preferred Stock shall mean placing such funds in a
separate account or delivering such funds to a disbursing, paying or other
similar agent.
"Trading Day" shall mean any day on which the securities in
question are traded on the NYSE, or if such securities are not listed or
admitted for trading on the NYSE, on the principal national securities exchange
on which such securities are listed or admitted, or if not listed or admitted
for trading on any national securities exchange, on the Nasdaq National Market,
or if such securities are not quoted thereon, in the applicable securities
market in which the securities are traded.
"Transaction" shall have the meaning set forth in paragraph
(8)(e) hereof.
(3) Rank. Any class or series of stock of the Corporation
shall be deemed to rank:
(1) prior to the 5-1/4% Preferred Stock, either as to the
payment of dividends or as to distribution of assets upon liquidation,
dissolution or winding up, or both, if the holders of such class or
series shall be entitled by the terms thereof to the receipt of
dividends and of amounts distributable upon liquidation, dissolution or
winding up, in preference or priority to the holders of 5-1/4%
Preferred Stock ("Senior Securities");
(2) on a parity with the 5-1/4% Preferred Stock and the
5-1/4% Convertible Preferred Stock, Series A, either as to the payment
of dividends or as to distribution of assets upon liquidation,
dissolution or winding up, or both, whether or not the dividend rates,
dividend payment dates or redemption or liquidation prices per share
thereof be different from those of the 5-1/4% Preferred Stock, if the
holders of the 5-1/4% Preferred Stock and of such class of stock or
series shall be entitled by the terms thereof to the receipt of
dividends or of amounts distributable upon liquidation, dissolution or
winding up, or both, in proportion to their respective amounts of
accrued and unpaid dividends per share or liquidation preferences,
without preference or priority one over the other and such class of
stock or series is not a class of Senior Securities ("Parity
Securities"); and
(3) junior to the 5-1/4% Preferred Stock, either as to the
payment of dividends or as to the distribution of assets upon
liquidation, dissolution or winding up, or both, if such stock or
series shall be Common Stock or if the holders of the 5-1/4% Preferred
Stock shall be entitled to receipt of dividends, and of amounts
distributable upon liquidation, dissolution or winding up, in
preference or priority to the holders of shares of such stock or series
("Junior Securities").
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The 13% Series B Senior Redeemable Exchangeable Preferred Stock (the
"13% Preferred") is a Senior Security. Each of the 9.9% Non-Voting
Mandatory Redeemable Preferred Stock, Series A ("Series A Preferred"),
and 9.9% Non-Voting Mandatory Redeemable Preferred Stock, Series B
("Series B Preferred"), is a Junior Security. One or more classes of
Additional Preferred (as defined below) shall be Parity Securities
provided, however, that there shall be no issue of other Parity
Securities except as approved by the holders of the 5-1/4% Preferred
Stock pursuant to paragraph 9(d).
The respective definitions of Senior Securities, Junior Securities and
Parity Securities shall also include any rights or options exercisable
for or convertible into any of the Senior Securities, Junior Securities
and Parity Securities, as the case may be. The 5-1/4% Preferred Stock
shall be subject to the creation of Junior Securities, Parity
Securities and Senior Securities as set forth herein.
(4) Dividends. (a) Subject to paragraph (8)(b)(ii), the
holders of shares of 5-1/4% Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors, out of
funds legally available for the payment of dividends, dividends at the
quarterly rate of $13.125 per share (assuming a $1,000.00 face amount)
payable in cash, shares of Common Stock equal to $13.125 per share of
5-1/4% Preferred Stock (having a value equal to the Current Market
Price as of the record date for such Dividend Payment Date) or
additional shares of Preferred Stock of a class to be designated by the
Board of Directors having terms substantially identical to the 5-1/4%
Preferred Stock except that: (i) the Conversion Rate (as set forth in
Section 8(a)) shall be the product of the Conversion Rate (as then in
effect) and the Relevant Compounding Factor and (ii) the number of the
shares of such Preferred Stock payable as a dividend on any Dividend
Payment Date shall increase for each Dividend Payment Date from the
first Dividend Payment Date by the Relevant Compounding Factor (such
classes of Preferred Stock singularly and collectively, the "Additional
Preferred"). Such dividends shall be payable in arrears quarterly on
each Dividend Payment Date. Dividends on the 5-1/4% Preferred Stock
shall be cumulative from the Issue Date (except that dividends on
Additional Shares shall accrue from the date such Additional Shares are
issued or would have been issued in accordance with this Certificate of
Designation if such dividends had been declared), whether or not in any
Dividend Period or Periods there shall be funds of the Corporation
legally available for the payment of such dividends. Each such dividend
shall be payable to the holders of record of shares of the 5-1/4%
Preferred Stock, as they appear on the stock records of the Corporation
at the close of business on the record date for such dividend. Upon the
declaration of any such dividend, the Board of Directors shall fix as
such record date on the fifth Business Day preceding the relevant
Dividend Payment Date and shall give notice on or prior to the record
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date of the form of payment of such dividend. Accrued and unpaid dividends for
any past Dividend Payment Date may be declared and paid at any time, without
reference to any Dividend Payment Date, to holders of record on such record
date, not more than 45 days nor less than five Business Days preceding the
payment date thereof, as may be fixed by the Board of Directors.
(1) For the purpose of determining the number of Additional
Preferred to be issued pursuant to paragraph (4)(a), each such
Additional Preferred shall be valued at $1,000.00. Holders of such
Additional Preferred shall be entitled to receive dividends payable at
the rates specified in paragraph (4)(a).
(2) The dividends payable for any period shorter than a
full Dividend Period, on the 5-1/4% Preferred Stock shall accrue daily
and be computed on the basis of a 360-day year and the actual number of
days in such period. Holders of shares of 5-1/4% Preferred Stock shall
not be entitled to any dividends, whether payable in cash, property or
stock, in excess of cumulative dividends, as herein provided, on the
5-1/4% Preferred Stock except as otherwise provided herein. No
interest, or sum of money in lieu of interest, shall be payable in
respect of any dividend payment or payments on the 5-1/4% Preferred
Stock that may be in arrears except as otherwise provided herein.
(3) So long as any shares of the 5-1/4% Preferred Stock are
outstanding, no dividends, except as described in the next succeeding
sentence, shall be declared or paid or set apart for payment on Parity
Securities, for any period, nor shall any Parity Securities be
redeemed, purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the
redemption of any such Parity Securities) by the Corporation (except
for conversion into or exchange into other Parity Securities) unless,
in each case, (i) full cumulative dividends on all outstanding shares
of the 5-1/4% Preferred Stock for all Dividend Periods terminating on
or prior to the date of such redemption, repurchase or other
acquisition shall have been paid or set apart for payment, (ii)
sufficient funds shall have been paid or set apart for the payment of
the dividend for the current Dividend Period with respect to the 5-1/4%
Preferred Stock and (iii) the Corporation is not in default with
respect to any redemption of shares of 5-1/4% Preferred Stock by the
Corporation pursuant to paragraph (6) below. When dividends are not
fully paid in Common Stock or Additional Preferred or are not paid in
full in cash or a sum sufficient for such payment is not set apart, as
aforesaid, all dividends declared upon shares of the 5-1/4% Preferred
Stock and all dividends declared upon Parity Securities shall be
declared ratably in proportion to the respective amounts of dividends
accumulated and unpaid on
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the 5-1/4% Preferred Stock and accumulated and unpaid on such Parity
Securities.
(4) So long as any shares of the 5-1/4% Preferred Stock are
outstanding, no dividends (other than (i) any rights issued pursuant to
a shareholder rights plan as provided in paragraph 11 and (ii)
dividends or distributions paid in shares of, or options, warrants or
rights to subscribe for or purchase shares of, Junior Securities) shall
be declared or paid or set apart for payment or other distribution
declared or made upon Junior Securities, nor shall any Junior
Securities be redeemed, purchased or otherwise acquired (other than a
redemption, purchase or other acquisition of shares of Common Stock
made for purposes of an employee incentive or benefit plan of the
Corporation or any subsidiary) (all such dividends, distributions,
redemptions or purchases being hereinafter referred to as "Junior
Securities Distributions") for any consideration (or any moneys be paid
to or made available for a sinking fund for the redemption of any
shares of any such stock) by the Corporation, directly or indirectly
(except by conversion into or exchange for Junior Securities, including
pursuant to paragraph 4(c) of the Series A Preferred and paragraph 4(d)
of the Series B Preferred), unless in each case (i) the full cumulative
dividends on all outstanding shares of the 5-1/4% Preferred Stock and
any other Parity Securities shall have been paid or set apart for
payment for all past Dividend Periods with respect to the 5-1/4%
Preferred Stock and all past dividend periods with respect to such
Parity Securities and (ii) sufficient funds shall have been paid or set
apart for the payment of the dividend for the current Dividend Period
with respect to the 5-1/4% Preferred Stock and the current dividend
period with respect to such Parity Securities.
(5) Liquidation Preference. (a) In the event of any
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary, before any payment or distribution of the assets of the Corporation
(whether capital or surplus) shall be made to or set apart for the holders of
Junior Securities, the holders of the shares of 5-1/4% Preferred Stock shall be
entitled to receive $1,000.00 per share of 5-1/4% Preferred Stock plus an amount
equal to all dividends (whether or not earned or declared) accrued and unpaid
thereon to the date of final distribution to such holders; but such holders
shall not be entitled to any further payment. If, upon any liquidation,
dissolution or winding up of the Corporation, the assets of the Corporation, or
proceeds thereof, distributable among the holders of the shares of 5-1/4%
Preferred Stock shall be insufficient to pay in full the preferential amount
aforesaid and liquidating payments on any Parity Securities, then such assets,
or the proceeds thereof, shall be distributed among the holders of shares of
5-1/4% Preferred Stock and any such other Parity Securities ratably in
accordance with the respective amounts that would be payable on such shares of
5-1/4% Preferred Stock and any such other stock if all amounts payable thereon
were paid in full. For the purposes of this
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paragraph (5), (i) a consolidation or merger of the Corporation with one or more
corporations, or (ii) a sale or transfer of all or substantially all of the
Corporation's assets, shall not be deemed to be a liquidation, dissolution or
winding up, voluntary or involuntary, of the Corporation.
(1) Subject to the rights of the holders of any Parity
Securities, upon any liquidation, dissolution or winding up of the
Corporation, after payment shall have been made in full to the holders
of the 5-1/4% Preferred Stock, as provided in this paragraph (5), any
other series or class or classes of Junior Securities shall, subject to
the respective terms and provisions (if any) applying thereto, be
entitled to receive any and all assets remaining to be paid or
distributed, and the holders of the 5-1/4% Preferred Stock shall not be
entitled to share therein.
(6) Redemption. (a) On and after the earlier to occur of (i)
January 28, 2006 or (ii) the date on which the Current Market Price of the
Common Stock shall have exceeded $120.00 for twenty-five (25) consecutive
Trading Days, to the extent the Corporation shall have funds legally available
for such payment, the Corporation may redeem at its option shares of 5-1/4%
Preferred Stock, in whole or from time to time in part, payable at the option of
the Corporation in (A) cash, at a redemption price of $1,000.00 per share, or
(B) in shares of Common Stock, at a redemption price of $1,025.00 per share in
the case of a redemption permitted by clause (i) or $1,000.00 per share in the
case of a redemption permitted by clause (ii), or (C) in a combination of cash
and Common Stock at a redemption price based on the respective combination of
consideration, together in each case with accrued and unpaid dividends thereon,
whether or not declared, to, but excluding, the date fixed for redemption,
without interest. For purposes of determining the number of shares of the Common
Stock to be issued pursuant to this paragraph (6)(a), the price per share of
Common Stock valued at the Fair Market Value.
(1) On and after January 28, 2009, each holder of shares of
5-1/4% Preferred Stock shall have the right to require the Corporation,
to the extent the Corporation shall have funds legally available
therefor, to redeem such holder's shares of 5-1/4% Preferred Stock in
whole or from time to time in part at a redemption price of $1,000.00
per share, payable at the option of the Corporation in cash, shares of
Common Stock or a combination thereof, together with accrued and unpaid
dividends thereon to, but excluding, the date fixed for redemption,
without interest. For purposes of determining the number of shares of
the Common Stock to be issued pursuant to this paragraph (6)(b), the
price per share of Common Stock shall equal the Fair Market Value. Any
holder of shares of 5-1/4% Preferred Stock who elects to exercise its
rights pursuant to this paragraph (6)(b) shall deliver to the
Corporation a written notice of election not less than 20 days prior to
January
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28, 2009, as the case may be, which notice shall set forth the name of
the Holder, the number of shares of 5-1/4% Preferred Stock to be
redeemed and a statement that the election to exercise a redemption
right is being made thereby; and shall deliver to the Corporation on or
before the date of redemption certificates evidencing the shares of
5-1/4% Preferred Stock to be redeemed, duly endorsed for transfer to
the Corporation.
(2) If the Corporation shall not have redeemed all
outstanding shares of 5-1/4% Preferred Stock pursuant to paragraphs
(6)(a) and (6)(b), on January 28, 2019 (the "Mandatory Redemption
Date"), to the extent the Corporation shall have funds legally
available for such payment, the Corporation shall redeem all
outstanding shares of 5-1/4% Preferred Stock, at a redemption price of
$1,000.00 per share, payable at the option of the Corporation in cash,
shares of Common Stock or a combination thereof, together with accrued
and unpaid dividends thereon to, but excluding, the Mandatory
Redemption Date, without interest. For purposes of determining the
number of shares of the Common Stock to be issued pursuant to this
paragraph (6)(c), the price per share of Common Stock shall be valued
at the Fair Market Value.
(3) If the Corporation is unable or shall fail to discharge
its obligation to redeem all outstanding shares of 5-1/4% Preferred
Stock pursuant to paragraph (6)(c) (the "Mandatory Redemption
Obligation"), the Mandatory Redemption Obligation shall be discharged
as soon as the Corporation is able to discharge such Mandatory
Redemption Obligation. If and so long as any Mandatory Redemption
Obligation with respect to the 5-1/4% Preferred Stock shall not be
fully discharged, the Corporation shall not (i) directly or indirectly,
redeem, purchase, or otherwise acquire any Parity Security or discharge
any mandatory or optional redemption, sinking fund or other similar
obligation in respect of any Parity Securities (except in connection
with a redemption, sinking fund or other similar obligation to be
satisfied pro rata with the 5-1/4% Preferred Stock) or (ii) declare or
make any Junior Securities Distribution (other than dividends or
distributions paid in shares of, or options, warrants or rights to
subscribe for or purchase shares of, Junior Securities), or, directly
or indirectly, discharge any mandatory or optional redemption, sinking
fund or other similar obligation in respect of the Junior Securities.
(4) Upon any redemption of 5-1/4% Preferred Stock, the
Corporation shall pay the redemption price and any accrued and unpaid
dividends in arrears to, but excluding, the applicable redemption date.
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(5) For purposes of paragraph (6)(a) only, unless full
cumulative dividends (whether or not declared) on all outstanding
shares of 5-1/4% Preferred Stock and any Parity Securities shall have
been paid or contemporaneously are declared and paid or set apart for
payment for all Dividend Periods terminating on or prior to the
applicable redemption date, none of the shares of 5-1/4% Preferred
Stock shall be redeemed, and no sum shall be set aside for such
redemption, unless shares of 5-1/4% Preferred Stock are redeemed pro
rata.
(7) Procedure for Redemption. (a) If the Corporation shall
redeem shares of 5-1/4% Preferred Stock pursuant to paragraph 6(a), notice of
such redemption shall be given by certified mail, return receipt requested,
postage prepaid, mailed not less than 30 days nor more than 60 days prior to the
redemption date, to each holder of record of the shares to be redeemed at such
holder's address as the same appears on the stock register of the Corporation
and confirmed by facsimile transmission to each holder of record if the
Corporation has been furnished with such facsimile address by the holder(s);
provided that neither the failure to give such notice nor confirmation nor any
defect therein or in the mailing thereof, to any particular holder, shall affect
the sufficiency of the notice or the validity of the proceedings for redemption
with respect to the other holders. Any notice that was mailed in the manner
herein provided shall be conclusively presumed to have been duly given on the
date mailed whether or not the holder receives the notice. Each such notice
shall state: (i) the redemption date; (ii) the number of shares of 5-1/4%
Preferred Stock to be redeemed and, if fewer than all the shares held by such
holder are to be redeemed, the number of shares to be redeemed from such holder;
(iii) the amount payable, whether in Common Stock or cash and if the payment is
in Common Stock an explanation of the determination of the amount to be paid;
(iv) the place or places where certificates for such shares are to be
surrendered for payment of the redemption price; and (v) that dividends on the
shares to be redeemed will cease to accrue on such redemption date, except as
otherwise provided herein.
(1) If notice has been mailed as aforesaid, from and after
the redemption date (unless default shall be made by the Corporation in
providing for the payment of the redemption price of the shares called
for redemption and dividends accrued and unpaid thereon, if any), (i)
except as otherwise provided herein, dividends on the shares of 5-1/4%
Preferred Stock so called for redemption shall cease to accrue, (ii)
said shares shall no longer be deemed to be outstanding, and (iii) all
rights of the holders thereof as holders of the 5-1/4% Preferred Stock
shall cease (except the right to receive from the Corporation the
redemption price without interest thereon, upon surrender and
endorsement of their certificates if so required, and to receive any
dividends payable thereon).
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(2) Upon surrender in accordance with notice given pursuant
to this paragraph (7) of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of Directors
of the Corporation shall so require and the notice shall so state),
such shares shall be redeemed by the Corporation at the redemption
price aforesaid, plus any dividends payable thereon. If fewer than all
the outstanding shares of 5-1/4% Preferred Stock are to be redeemed,
the number of shares to be redeemed shall be determined by the Board of
Directors and the shares to be redeemed shall be selected pro rata
(with any fractional shares being rounded to the nearest whole share).
In case fewer than all the shares represented by any such certificate
are redeemed, a new certificate shall be issued representing the
unredeemed shares without cost to the holder thereof.
(8) Conversion. (a) Subject to and upon compliance with the
provisions of this paragraph (8), a holder of shares of 5-1/4% Preferred Stock
shall have the right, at any time and from time to time, at such holder's
option, to convert any or all outstanding shares of 5-1/4% Preferred Stock held
by such holder, but not fractions of shares, into fully paid and non-assessable
shares of Common Stock by surrendering such shares to be converted, such
surrender to be made in the manner provided in paragraph (8)(b) hereof. The
number of shares of Common Stock deliverable upon conversion of each share of
5-1/4% Preferred Stock shall be equal to 101.3125 (as adjusted as provided
herein, the "Conversion Rate"); provided that the aggregate number of shares of
Common Stock deliverable upon conversion of the 5-1/4% Preferred Stock (together
with the conversion of any 5-1/4% Convertible Preferred Stock, Series A or any
additional preferred stock issued as payment for dividends with respect thereto
and any Additional Preferred) shall not be greater than 7,590,994 subject to
adjustment as provided herein. The Conversion Rate is subject to adjustment from
time to time pursuant to paragraph (8)(d) hereof. The right to convert shares
called for redemption pursuant to paragraph (7) shall terminate at the close of
business on the date immediately preceding the date fixed for such redemption
unless the Corporation shall default in making payment of the amount payable
upon such redemption. Upon conversion of any share of 5-1/4% Preferred Stock the
holder thereof shall continue to be entitled to receive from the Corporation any
accrued but unpaid dividends thereon.
(1) (i) In order to exercise the conversion privilege, the
holder of each share of 5-1/4% Preferred Stock to be converted shall
surrender the certificate representing such share, duly endorsed or
assigned to the Corporation or in blank, at the office of the
Corporation, or to any transfer agent of the Corporation previously
designated by the Corporation to the holders of the 5-1/4% Preferred
Stock for such purposes, with a written notice of election to convert
completed and signed, specifying the number of shares to be converted.
Such notice shall state that the holder has satisfied any legal
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or regulatory requirement for conversion, including compliance with the
Hart-Scott-Rodino Antitrust Improvements Act of 1976. Such notice shall
also state the name or names (with address and social security or other
taxpayer identification number) in which the certificate or
certificates for Common Stock are to be issued. Unless the shares
issuable on conversion are to be issued in the same name as the name in
which such share of 5-1/4% Preferred Stock is registered, each share
surrendered for conversion shall be accompanied by instruments of
transfer, in form satisfactory to the Corporation, duly executed by the
holder or the holder's duly authorized attorney and an amount
sufficient to pay any transfer or similar tax (or evidence reasonably
satisfactory to the Corporation demonstrating that such taxes have been
paid). All certificates representing shares of 5-1/4% Preferred Stock
surrendered for conversion shall be canceled by the Corporation or the
transfer agent.
(1) Holders of shares of 5-1/4% Preferred Stock at the
close of business on a dividend payment record date shall not be
entitled to receive the dividend payable on such shares on the
corresponding Dividend Payment Date if such holder shall have
surrendered for conversion such shares at any time following the
preceding Dividend Payment Date and prior to such Dividend Payment
Date.
(2) As promptly as practicable after the surrender by a
holder of the certificates for shares of 5-1/4% Preferred Stock as
aforesaid, the Corporation shall issue and shall deliver to such
holder, or on the holder's written order, a certificate or certificates
(which certificate or certificates shall have the legend set forth in
paragraph 10(c)) for the whole number of duly authorized, validly
issued, fully paid and non-assessable shares of Common Stock issuable
upon the conversion of such shares in accordance with the provisions of
this paragraph (8), and any fractional interest in respect of a share
of Common Stock arising on such conversion shall be settled as provided
in paragraph (8)(c). Upon conversion of only a portion of the shares of
5-1/4% Preferred Stock represented by any certificate, a new
certificate shall be issued representing the unconverted portion of the
certificate so surrendered without cost to the holder thereof. Upon the
surrender of certificates representing shares of 5-1/4% Preferred Stock
to be converted, such shares shall no longer be deemed to be
outstanding and all rights of a holder with respect to such shares
surrendered for conversion shall immediately terminate except the right
to receive the Common Stock and other amounts payable pursuant to this
paragraph (8).
(3) Each conversion shall be deemed to have been effected
immediately prior to the close of business on the date on which the
certificates for
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shares of 5-1/4% Preferred Stock shall have been surrendered and such
notice received by the Corporation as aforesaid, and the Person or
Persons in whose name or names any certificate or certificates for
shares of Common Stock shall be issuable upon such conversion shall be
deemed to have become the holder or holders of record of the shares of
Common Stock represented thereby at such time on such date and such
conversion shall be into a number of shares of Common Stock equal to
the product of the number of shares of 5-1/4% Preferred Stock
surrendered times the Conversion Rate in effect at such time on such
date, unless the stock transfer books of the Corporation shall be
closed on that date, in which event such Person or Persons shall be
deemed to have become such holder or holders of record at the close of
business on the next succeeding day on which such stock transfer books
are open, but such conversion shall be based upon the Conversion Rate
in effect on the date upon which such shares shall have been
surrendered and such notice received by the Corporation.
(2) No fractional shares or scrip representing fractions of
shares of Common Stock shall be issued upon conversion of the 5-1/4%
Preferred Stock. Instead of any fractional interest in a share of
Common Stock that would otherwise be deliverable upon the conversion of
a share of 5-1/4% Preferred Stock, the Corporation shall pay to the
holder of such share an amount in cash based upon the Current Market
Price of Common Stock on the Trading Day immediately preceding the date
of conversion. If more than one share shall be surrendered for
conversion 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 of 5-1/4% Preferred Stock
surrendered for conversion by such holder.
(3) The Conversion Rate shall be adjusted from time to time as
follows:
(1) If the Corporation shall after the Issue Date (A)
declare a dividend or make a distribution on its Common Stock in shares
of its Common Stock, (B) subdivide its outstanding Common Stock into a
greater number of shares or (C) combine its outstanding Common Stock
into a smaller number of shares, the Conversion Rate in effect on the
record date for such dividend or distribution, or the effective date of
such subdivision or combination, as the case may be, shall be
proportionately adjusted so that the holder of any share of 5-1/4%
Preferred Stock thereafter surrendered for conversion shall be entitled
to receive the number and kind of shares of Common Stock that such
holder would have owned or have been entitled to receive after the
happening of any of the events described above had such share been
converted immediately prior to the record date in the case of a
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dividend or distribution or the effective date in the case of a
subdivision or combination. An adjustment made pursuant to this
subparagraph (i) shall become effective immediately after the opening
of business on the Business Day next following the record date (except
as provided in paragraph (8)(h)) in the case of a dividend or
distribution and shall become effective immediately after the opening
of business on the Business Day next following the effective date in
the case of a subdivision, combination or reclassification. Adjustments
in accordance with this paragraph (8)(d)(i) shall be made whenever any
event listed above shall occur.
(2) If the Corporation shall after the Issue Date fix a
record date for the issuance of rights or warrants (in each case, other
than any rights issued pursuant to a shareholder rights plan) to all
holders of Common Stock entitling them (for a period expiring within 45
days after such record date) to subscribe for or purchase Common Stock
(or securities convertible into Common Stock) at a price per share (or,
in the case of a right or warrant to purchase securities convertible
into Common Stock, having an effective exercise price per share of
Common Stock, computed on the basis of the maximum number of shares of
Common Stock issuable upon conversion of such convertible securities,
plus the amount of additional consideration payable, if any, to receive
one share of Common Stock upon conversion of such securities) less than
the Fair Market Value per share of Common Stock on the date on which
such issuance was declared or otherwise announced by the Corporation
(the "Determination Date"), then the Conversion Rate in effect at the
opening of business on the Business Day next following such record date
shall be adjusted so that the holder of each share of 5-1/4% Preferred
Stock shall be entitled to receive, upon the conversion thereof, the
number of shares of Common Stock determined by multiplying (I) the
Conversion Rate in effect immediately prior to such record date by (II)
a fraction, the numerator of which shall be the sum of (A) the number
of shares of Common Stock outstanding on the close of business on the
Determination Date and (B) the number of additional shares of Common
Stock offered for subscription or purchase pursuant to such rights or
warrants (or in the case of a right or warrant to purchase securities
convertible into Common Stock, the aggregate number of additional
shares of Common Stock into which the convertible securities so offered
are initially convertible), and the denominator of which shall be the
sum of (A) the number of shares of Common Stock outstanding on the
close of business on the Determination Date and (B) the number of
shares that the aggregate proceeds to the Corporation from the exercise
of such rights or warrants for Common Stock would purchase at such Fair
Market Value on such date (or, in the case of a right or warrant to
purchase securities convertible into Common Stock, the number of shares
of Common Stock obtained by dividing the aggregate
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exercise price of such rights or warrants for the maximum number of
shares of Common Stock issuable upon conversion of such convertible
securities, plus the aggregate amount of additional consideration
payable, if any, to convert such securities into Common Stock, by such
Fair Market Value). Such adjustment shall become effective immediately
after the opening of business on the Business Day next following such
record date (except as provided in paragraph (8)(h)). Such adjustment
shall be made successively whenever such a record date is fixed. In the
event that after fixing a record date such rights or warrants are not
so issued, the Conversion Rate shall be readjusted to the Conversion
Rate which would then be in effect if such record date had not been
fixed. In determining whether any rights or warrants entitle the
holders of Common Stock to subscribe for or purchase shares of Common
Stock at less than such Fair Market Value, there shall be taken into
account any consideration received by the Corporation upon issuance and
upon exercise of such rights or warrants, the value of such
consideration, if other than cash, to be determined by the Board of
Directors in good faith. In case any rights or warrants referred to in
this subparagraph (ii) shall expire unexercised after the same shall
have been distributed or issued by the Corporation (or, in the case of
rights or warrants to purchase securities convertible into Common Stock
once exercised, the conversion right of such securities shall expire),
the Conversion Rate shall be readjusted at the time of such expiration
to the Conversion Rate that would have been in effect if no adjustment
had been made on account of the distribution or issuance of such
expired rights or warrants.
(3) If the Corporation shall fix a record date for the
making of a distribution to all holders of its Common Stock of
evidences of its indebtedness, shares of its capital stock or assets
(excluding regular cash dividends or distributions declared in the
ordinary course by the Board of Directors and dividends payable in
Common Stock for which an adjustment is made pursuant to paragraph
(8)(d)(i)) or rights or warrants (in each case, other than any rights
issued pursuant to a shareholder rights plan) to subscribe for or
purchase any of its securities (excluding those rights and warrants
issued to all holders of Common Stock entitling them for a period
expiring within 45 days after the record date referred to in
subparagraph (ii) above to subscribe for or purchase Common Stock or
securities convertible into shares of Common Stock, which rights and
warrants are referred to in and treated under subparagraph (ii) above)
(any of the foregoing being hereinafter in this subparagraph (iii)
called the "Securities"), then in each such case the Conversion Rate
shall be adjusted so that the holder of each share of 5-1/4% Preferred
Stock shall be entitled to receive, upon the conversion thereof, the
number of shares of Common Stock determined by multiplying (I) the
Conversion Rate in effect immediately prior to the close of business on
such record date by (II) a
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fraction, the numerator of which shall be the Fair Market Value per
share of the Common Stock on such record date, and the denominator of
which shall be the Fair Market Value per share of the Common Stock on
such record date less the then-fair market value (as determined by the
Board of Directors in good faith, whose determination shall be
conclusive) of the portion of the assets, shares of its capital stock
or evidences of indebtedness so distributed or of such rights or
warrants applicable to one share of Common Stock. Such adjustment shall
be made successively whenever such a record date is fixed; and in the
event that after fixing a record date such distribution is not so made,
the Conversion Rate shall be readjusted to the Conversion Rate which
would then be in effect if such record date had not been fixed. Such
adjustment shall become effective immediately at the opening of
business on the Business Day next following (except as provided in
paragraph (8)(h)) the record date for the determination of shareholders
entitled to receive such distribution. For the purposes of this
subparagraph (iii), the distribution of a Security, which is
distributed not only to the holders of the Common Stock on the date
fixed for the determination of shareholders entitled to such
distribution of such Security, but also is distributed with each share
of Common Stock delivered to a Person converting a share of 5-1/4%
Preferred Stock after such determination date, shall not require an
adjustment of the Conversion Rate pursuant to this subparagraph (iii);
provided that on the date, if any, on which a Person converting a share
of 5-1/4% Preferred Stock would no longer be entitled to receive such
Security with a share of Common Stock (other than as a result of the
termination of all such Securities), a distribution of such Securities
shall be deemed to have occurred and the Conversion Rate shall be
adjusted as provided in this subparagraph (iii) (and such day shall be
deemed to be "the date fixed for the determination of shareholders
entitled to receive such distribution" and "the record date" within the
meaning of the three preceding sentences). If any rights or warrants
referred to in this subparagraph (iii) shall expire unexercised after
the same shall have been distributed or issued by the Corporation, the
Conversion Rate shall be readjusted at the time of such expiration to
the Conversion Rate that would have been in effect if no adjustment had
been made on account of the distribution or issuance of such expired
rights or warrants.
(4) In case the Corporation shall, by dividend or
otherwise, distribute to all holders of its Common Stock cash in an
amount per share that, together with the aggregate of the per share
amounts of any other cash distributions to all holders of its Common
Stock made within the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to this
paragraph (iv) has been made exceeds 5.0% of the Fair Market Value
immediately prior to the date of declaration of such dividend or
distribution (excluding any dividend or distribution in connection
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with the liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, and any cash that is distributed upon
a merger, consolidation or other transaction for which an adjustment
pursuant to paragraph 8(e) is made), then, in such case, the Conversion
Rate shall be adjusted so that the same shall equal the rate determined
by multiplying the Conversion Rate in effect immediately prior to the
close of business on the Record Date for the cash dividend or
distribution by a fraction the numerator of which shall be the Current
Market Price of a share of the Common Stock on the Record Date and the
denominator shall be such Current Market Price less the per share
amount of cash so distributed during the 12-month period applicable to
one share of Common Stock, such adjustment to be effective immediately
prior to the opening of business on the Business Day following the
Record Date; provided, however, that in the event the denominator of
the foregoing fraction is zero or negative, in lieu of the foregoing
adjustment, adequate provision shall be made so that each holder of
5-1/4% Preferred Stock shall have the right to receive upon conversion,
in addition to the shares of Common Stock to which the holder is
entitled, the amount of cash such holder would have received had such
holder converted each share of 5-1/4% Preferred Stock at the beginning
of the 12-month period. In the event that such dividend or distribution
is not so paid or made, the Conversion Rate shall again be adjusted to
be the Conversion Rate which would then be in effect if such dividend
or distribution had not been declared. Notwithstanding the foregoing,
if any adjustment is required to be made as set forth in this paragraph
(8)(d)(iv), the calculation of any such adjustment shall include the
amount of the quarterly cash dividends paid during the 12-month
reference period only to the extent such dividends exceed the regular
quarterly cash dividends paid during the 12 months preceding the
12-month reference period. For purposes of this paragraph (8)(d)(iv),
"Record Date" shall mean, with respect to any dividend or distribution
in which the holders of Common Stock have the right to receive cash,
the date fixed for determination of shareholders entitled to receive
such cash.
In the event that at any time cash distributions to holders of Common
Stock are not paid equally on all series of Common Stock, the
provisions of this paragraph 8(d)(iv) will apply to any cash dividend
or cash distribution on any series of Common Stock otherwise meeting
the requirements of this paragraph, and shall be deemed amended to the
extent necessary so that any adjustment required will be made on the
basis of the cash dividend or cash distribution made on any such
series.
(5) In case of the consummation of a tender or exchange
offer (other than an odd-lot tender offer) made by the Corporation or
any subsidiary of the Corporation for all or any portion of the
outstanding shares
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of Common Stock to the extent that the cash and fair market value (as
determined in good faith by the Board of Directors of the Corporation,
whose determination shall be conclusive and shall be described in a
resolution of such Board) of any other consideration included in such
payment per share of Common Stock at the last time (the "Expiration
Time") tenders or exchanges may be made pursuant to such tender or
exchange offer (as amended) exceed by more than 5.0%, with any smaller
excess being disregarded in computing the adjustment to the Conversion
Rate provided in this paragraph (8)(d)(v), the first reported sale
price per share of Common Stock on the Trading Day next succeeding the
Expiration Time, then the Conversion Rate shall be adjusted so that the
same shall equal the rate determined by multiplying the Conversion Rate
in effect immediately prior to the Expiration Time by a fraction the
numerator of which shall be the sum of (x) the fair market value
(determined as aforesaid) of the aggregate consideration payable to
shareholders based on the acceptance (up to any maximum specified in
the terms of the tender or exchange offer) of all shares validly
tendered or exchanged and not withdrawn as of the Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to as
the "Purchased Shares") and (y) the product of the number of shares of
Common Stock outstanding (less any Purchased Shares) on the Expiration
Time and the first reported sale price of the Common Stock on the
Trading Day next succeeding the Expiration Time, and the denominator of
which shall be the number of shares of Common Stock outstanding
(including any tendered or exchanged shares) on the Expiration Time
multiplied by the first reported sale price of the Common Stock on the
Trading Day next succeeding the Expiration Time, such adjustment to
become effective immediately prior to the opening of business on the
day following the Expiration Time.
(6) No adjustment in the Conversion Rate shall be required
unless such adjustment would require a cumulative increase or decrease
of at least 1% in the Conversion Rate; provided, however, that any
adjustments that by reason of this subparagraph (vi) are not required
to be made shall be carried forward and taken into account in any
subsequent adjustment until made; and provided, further, that any
adjustment shall be required and made in accordance with the provisions
of this paragraph (8) (other than this subparagraph (vi)) not later
than such time as may be required in order to preserve the tax-free
nature of a distribution for United States income tax purposes to the
holders of shares of 5-1/4% Preferred Stock or Common Stock.
Notwithstanding any other provisions of this paragraph (8), the
Corporation shall not be required to make any adjustment of the
Conversion Rate for the issuance of any shares of Common Stock pursuant
to any plan providing for the reinvestment of dividends or interest
payable on securities of the Corporation and the investment of
additional optional amounts in shares of Common Stock under
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such plan. All calculations under this paragraph (8) shall be made to
the nearest dollar or to the nearest 1/1,000 of a share, as the case
may be. Anything in this paragraph (8)(d) to the contrary
notwithstanding, the Corporation shall be entitled, to the extent
permitted by law, to make such adjustments in the Conversion Rate, in
addition to those required by this paragraph (8)(d), as it in its
discretion shall determine to be advisable in order that any stock
dividends, subdivision of shares, reclassification or combination of
shares, distribution of rights or warrants to purchase stock or
securities, or a distribution of other assets (other than cash
dividends) hereafter made by the Corporation to its shareholders shall
not be taxable.
(7) In the event that, at any time as a result of shares of
any other class of capital stock becoming issuable in exchange or
substitution for or in lieu of shares of Common Stock or as a result of
an adjustment made pursuant to the provisions of this paragraph (8)(d),
the holder of 5-1/4% Preferred Stock upon subsequent conversion shall
become entitled to receive any shares of capital stock of the
Corporation other than Common Stock, the number of such other shares so
receivable upon conversion of any shares of 5-1/4% Preferred Stock
shall thereafter be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions
contained herein.
(4) (i) If the Corporation shall be a party to any
transaction (including, without limitation, a merger, consolidation,
sale of all or substantially all of the Corporation's assets or
recapitalization of the Common Stock and excluding any transaction as
to which paragraph (8)(d)(i) applies) (each of the foregoing being
referred to herein as a "Transaction"), in each case as a result of
which shares of Common Stock shall be converted into the right to
receive stock, securities or other property (including cash or any
combination thereof), there shall be no adjustment to the Conversion
Rate but each share of 5-1/4% Preferred Stock which is not converted
into the right to receive stock, securities or other property in
connection with such Transaction shall thereafter be convertible into
the kind and amount of shares of stock, securities and other property
(including cash or any combination thereof) receivable upon the
consummation of such Transaction by a holder of that number of shares
or fraction thereof of Common Stock into which one share of 5-1/4%
Preferred Stock was convertible immediately prior to such Transaction,
assuming such holder of Common Stock (i) is not a Person with which the
Corporation consolidated or into which the Corporation merged or which
merged into the Corporation or to which such sale or transfer was made,
as the case may be ("Constituent Person"), or an affiliate of a
Constituent Person and (ii) failed to exercise his rights of election,
if any, as to the kind or amount of stock, securities and other
property (including cash)
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receivable upon such Transaction (provided that if the kind or amount
of stock, securities and other property (including cash) receivable
upon such Transaction is not the same for each share of Common Stock of
the Corporation held immediately prior to such Transaction by other
than a Constituent Person or an affiliate thereof and in respect of
which such rights of election shall not have been exercised
("non-electing share"), then for the purpose of this paragraph (8)(e)
the kind and amount of stock, securities and other property (including
cash) receivable upon such Transaction by each non-electing share shall
be deemed to be the kind and amount so receivable per share by a
plurality of the non-electing shares). The provisions of this paragraph
(8)(e) shall similarly apply to successive Transactions.
(1) Notwithstanding anything herein to the contrary, if the
Company is reorganized such that the Common Stock is exchanged for the
common stock of a new entity ("Holdco") whose common stock is traded on
NASDAQ or another recognized securities exchange, then the Company, by
notice to the holders of the 5-1/4% Preferred Stock but without any
required consent on their part, may cause the exchange of this 5-1/4%
Preferred Stock for preferred stock of Holdco having the same terms and
conditions as set forth herein, provided that where Holdco is not
solely incorporated as a Delaware company or where the Holdco share
structure is not identical to that of the Company, the rights attaching
to the preferred stock of Holdco may be adjusted so as to comply with
the local law of the country of incorporation of Holdco or the new
share structure of Holdco subject to such rights effectively giving the
same economic rights as the 5-1/4% Preferred Stock (ignoring for these
purposes any resultant change in the tax treatment for the holders of
such stock).
(5) If:
(1) the Corporation shall declare a dividend (or any other
distribution) on the Common Stock; or
(2) the Corporation shall authorize the granting to the
holders of the Common Stock of rights or warrants to subscribe for or
purchase any shares of any class or any other rights or warrants; or
(3) there shall be any subdivision, combination or
reclassification of the Common Stock or any consolidation or merger to
which the Corporation is a party and for which approval of any
shareholders of the Corporation is required, or the sale or transfer of
all or substantially all of the assets of the Corporation as an
entirety; or
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(4) there shall occur the voluntary or involuntary
liquidation, dissolution or winding up of the Corporation;
then the Corporation shall cause to be filed with any transfer agent
designated by the Corporation pursuant to paragraph (8)(b) and shall
cause to be mailed to the holders of shares of the 5-1/4% Preferred
Stock at their addresses as shown on the stock records of the
Corporation, as promptly as possible, but at least ten days prior to
the applicable date hereinafter specified, a notice stating (A) the
date on which a record is to be taken for the purpose of such dividend
(or such other distribution) or rights or warrants, 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 or
warrants are to be determined or (B) the date on which such
subdivision, combination, reclassification, consolidation, merger,
sale, transfer, liquidation, dissolution or winding up or other action
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,
if any, deliverable upon such subdivision, combination,
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution or winding up. Failure to give or receive such notice or
any defect therein shall not affect the legality or validity of any
distribution, right, warrant, subdivision, combination,
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, winding up or other action, or the vote upon any of the
foregoing.
(6) Whenever the Conversion Rate is adjusted as herein
provided, the Corporation shall prepare an officer's certificate with
respect to such adjustment of the Conversion Rate setting forth the
adjusted Conversion Rate and the effective date of such adjustment and
shall mail a copy of such officer's certificate to the holder of each
share of 5-1/4% Preferred Stock at such holder's last address as shown
on the stock records of the Corporation. If the Corporation shall have
designated a transfer agent pursuant to paragraph (8)(b), it shall also
promptly file with such transfer agent an officer's certificate setting
forth the Conversion Rate after such adjustment and setting forth a
brief statement of the facts requiring such adjustment which
certificate shall be conclusive evidence of the correctness of such
adjustment.
(7) In any case in which paragraph (8)(d) provides that an
adjustment shall become effective on the day next following a record
date for an event, the Corporation may defer until the occurrence of
such event (i) issuing to the holder of any share of 5-1/4% Preferred
Stock converted after such record date and before the occurrence of
such event the additional shares of Common Stock issuable upon such
conversion by reason of the adjustment
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required by such event over and above the Common Stock issuable upon
such conversion before giving effect to such adjustment and (ii) paying
to such holder any amount in cash in lieu of any fraction pursuant to
paragraph (8)(c).
(8) For purposes of this paragraph (8), the number of
shares of Common Stock at any time outstanding shall not include any
shares of Common Stock then owned or held by or for the account of the
Corporation. The Corporation shall not pay a dividend or make any
distribution on shares of Common Stock held in the treasury of the
Corporation.
(9) There shall be no adjustment of the Conversion Rate in
case of the issuance of any stock of the Corporation in a
reorganization, acquisition or other similar transaction except as
specifically set forth in this paragraph (8). If any single action
would require adjustment of the Conversion Rate pursuant to more than
one subparagraph of this paragraph (8), only one adjustment shall be
made and such adjustment shall be the amount of adjustment that has the
highest absolute value.
(10) If the Corporation shall take any action affecting the
Common Stock, other than action described in this paragraph (8), that
in the opinion of the Board of Directors materially adversely affects
the conversion rights of the holders of the shares of 5-1/4% Preferred
Stock, the Conversion Rate may be adjusted, to the extent permitted by
law, in such manner, if any, and at such time, as the Board of
Directors may determine to be equitable in the circumstances; provided
that the provisions of this paragraph (8)(k) shall not affect any
rights the holders of 5-1/4% Preferred Stock may have at law or in
equity.
(11) (i) The Corporation covenants that it will at all
times reserve and keep available, free from preemptive rights, out of
the aggregate of its authorized but unissued shares of Common Stock or
its issued shares of Common Stock held in its treasury, or both, for
the purpose of effecting conversion of the 5-1/4% Preferred Stock, the
full number of shares of Common Stock deliverable upon the conversion
of all outstanding shares of 5-1/4% Preferred Stock not theretofore
converted. For purposes of this paragraph (8)(1) the number of shares
of Common Stock that shall be deliverable upon the conversion of all
outstanding shares of 5-1/4% Preferred Stock shall be computed as if at
the time of computation all such outstanding shares were held by a
single holder.
(1) The Corporation covenants that any shares of Common Stock
issued upon conversion of the 5-1/4% Preferred Stock shall be duly
authorized, validly issued, fully paid and non-assessable. Before
taking any action that
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would cause an adjustment increasing the Conversion Rate such that the
quotient of $1,000.00 and the Conversion Rate (which initially shall be
$100.00) would be reduced below the then-par value of the shares of
Common Stock deliverable upon conversion of the 5-1/4% Preferred Stock,
the Corporation will take any corporate action that, in the opinion of
its counsel, may be necessary in order that the Corporation may validly
and legally issue fully paid and non-assessable shares of Common Stock
based upon such adjusted Conversion Rate.
(2) Prior to the delivery of any securities that the
Corporation shall be obligated to deliver upon conversion of the 5-1/4%
Preferred Stock, the Corporation shall comply with all applicable
federal and state laws and regulations which require action to be taken
by the Corporation.
(12) The Corporation will pay any and all documentary stamp
or similar issue or transfer taxes payable in respect of the issue or
delivery of shares of Common Stock or other securities or property on
conversion of the 5-1/4% Preferred Stock pursuant hereto; provided,
however, that the Corporation shall not be required to pay any tax that
may be payable in respect of any transfer involved in the issue or
delivery of shares of Common Stock or other securities or property in a
name other than that of the holder of the 5-1/4% Preferred Stock to be
converted and no such issue or delivery shall be made unless and until
the Person requesting such issue or delivery has paid to the
Corporation the amount of any such tax or established, to the
satisfaction of the Corporation, that such tax has been paid.
(9) Voting Rights. (a) The holders of record of shares of
5-1/4% Preferred Stock shall not be entitled to any voting rights except as
hereinafter provided in paragraph (b) or as otherwise provided by law.
(1) If and whenever six quarterly dividends (whether or not
consecutive) payable on the 5-1/4% Preferred Stock have not been paid
in full or if the Corporation shall have failed to discharge its
Mandatory Redemption Obligation, the number of directors then
constituting the Board of Directors shall be increased by two and the
holders of shares of 5-1/4% Preferred Stock, together with the holders
of shares of every other series of preferred stock (including, without
limitation, Additional Preferred) upon which like rights to vote for
the election of two additional directors have been conferred and are
exercisable (resulting from either the failure to pay dividends or the
failure to redeem) (any such other series is referred to as the
"Preferred Shares"), voting as a single class regardless of series,
shall be entitled to elect the two additional directors to serve on the
Board of Directors at any annual meeting of stockholders or special
meeting held in place
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thereof, or at a special meeting of the holders of the 5-1/4% Preferred
Stock and the Preferred Shares called as hereinafter provided. Whenever
all arrears in dividends on the 5-1/4% Preferred Stock and the
Preferred Shares then outstanding shall have been paid and dividends
thereon for the current quarterly dividend period shall have been paid
or declared and set apart for payment, or the Corporation shall have
fulfilled its Mandatory Redemption Obligation and any redemption
obligation in respect of the Preferred Shares, as the case may be, then
the right of the holders of the 5-1/4% Preferred Stock and the
Preferred Shares to elect such additional two directors shall cease
(but subject always to the same provisions for the vesting of such
voting rights in the case of any similar future arrearages in six
quarterly dividends or failure to fulfill any Mandatory Redemption
Obligation), and the terms of office of all persons elected as
directors by the holders of the 5-1/4% Preferred Stock and the
Preferred Shares shall forthwith terminate and the number of the Board
of Directors shall be reduced accordingly. At any time after such
voting power shall have been so vested in the holders of shares of
5-1/4% Preferred Stock and the Preferred Shares, the secretary of the
Corporation may, and upon the written request of any holder of 5-1/4%
Preferred Stock (addressed to the secretary at the principal office of
the Corporation) shall, call a special meeting of the holders of the
5-1/4% Preferred Stock and of the Preferred Shares for the election of
the two directors to be elected by them as herein provided, such call
to be made by notice similar to that provided in the Bylaws of the
Corporation for a special meeting of the stockholders or as required by
law. If any such special meeting required to be called as above
provided shall not be called by the secretary within 20 days after
receipt of any such request, then any holder of shares of 5-1/4%
Preferred Stock may call such meeting, upon the notice above provided,
and for that purpose shall have access to the stock books of the
Corporation. The directors elected at any such special meeting shall
hold office until the next annual meeting of the stockholders or
special meeting held in lieu thereof if such office shall not have
previously terminated as above provided. If any vacancy shall occur
among the directors elected by the holders of the 5-1/4% Preferred
Stock and the Preferred Shares, a successor shall be elected by the
Board of Directors, upon the nomination of the then-remaining director
elected by the holders of the 5-1/4% Preferred Stock and the Preferred
Shares or the successor of such remaining director, to serve until the
next annual meeting of the stockholders or special meeting held in
place thereof if such office shall not have previously terminated as
provided above.
(2) Without the written consent of the holders of at least
66-2/3% in liquidation preference of the outstanding shares of 5-1/4%
Preferred Stock or the vote of holders of at least 66-2/3% in
liquidation preference of the outstanding shares of 5-1/4% Preferred
Stock at a meeting of the holders of
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5-1/4% Preferred Stock called for such purpose, the Corporation will
not amend, alter or repeal any provision of the Certificate of
Incorporation (by merger or otherwise) so as to adversely affect the
preferences, rights or powers of the 5-1/4% Preferred Stock; provided
that any such amendment that changes the dividend payable on, the
conversion rate with respect to, or the liquidation preference of the
5-1/4% Preferred Stock shall require the affirmative vote at a meeting
of holders of 5-1/4% Preferred Stock called for such purpose or written
consent of the holder of each share of 5-1/4% Preferred Stock.
(3) Without the written consent of the holders of at least
66 2/3% in liquidation preference of the outstanding shares of 5-1/4%
Preferred Stock or the vote of holders of at least 66 2/3% in
liquidation preference of the outstanding shares of 5-1/4% Preferred
Stock at a meeting of such holders called for such purpose, the
Corporation will not issue any additional 5-1/4% Preferred Stock or
create, authorize or issue any Parity Securities or Senior Securities
or increase the authorized amount of any such other class or series;
provided that paragraph 9(d) shall not limit the right of the
Corporation to (i) issue Additional Preferred as dividends pursuant to
paragraph 4 or (ii) to issue Parity Securities or Senior Securities in
order to refinance, redeem or refund the 13% Preferred, provided that
the maximum accrual value (i.e., the sum of stated value and maximum
amount payable in kind over the term from issuance to first date of
mandatory redemption or redemption at the option of the holder) of such
Parity Securities may not exceed the maximum accrual value of the 13%
Preferred.
(4) In exercising the voting rights set forth in this
paragraph 9, each share of 5-1/4% Preferred Stock shall have one vote
per share, except that when any other series of preferred stock shall
have the right to vote with the 5-1/4% Preferred Stock as a single
class on any matter, then the 5-1/4% Preferred Stock and such other
series shall have with respect to such matters one vote per $1,000 of
stated liquidation preference. Except as otherwise required by
applicable law or as set forth herein, the shares of 5-1/4% Preferred
Stock shall not have any relative, participating, optional or other
special voting rights and powers and the consent of the holders thereof
shall not be required for the taking of any corporate action.
(10) General Provisions. (a) The headings of the paragraphs,
subparagraphs, clauses and subclauses of this Statement of Designations are for
convenience of reference only and shall not define, limit or affect any of the
provisions hereof.
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(1) If the Corporation shall have failed to declare or pay
dividends as required pursuant to paragraph (4) hereof or shall have
failed to discharge any obligation to redeem shares of 5-1/4% Preferred
Stock pursuant to paragraph (6) hereof, the holders of shares of 5-1/4%
Preferred Stock shall be entitled to receive, in addition to all other
amounts required to be paid hereunder, when, as and if declared by the
Board of Directors, out of funds legally available for the payment of
dividends, cash dividends on the aggregate dividends which the
Corporation shall have failed to declare or pay or the redemption
price, together with accrued and unpaid dividends thereon, as the case
may be, at a rate of 2% per quarter, compounded quarterly, for the
period during which the failure to pay dividends or failure to
discharge an obligation to redeem shares of 5-1/4% Preferred Stock
shall continue.
(2) The shares of 5-1/4% Preferred Stock shall bear the
following legend:
THE SHARES OF PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE MAY NOT
BE TRANSFERRED OTHER THAN TO AN AFFILIATE OF THE HOLDER.
The shares of Common Stock issuable upon conversion of the
5-1/4% Preferred Stock shall bear the following legend:
THE SHARES OF COMMON STOCK, PAR VALUE $.01, OF THE COMPANY (THE "COMMON
STOCK") REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD IN
THE UNITED STATES ABSENT REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT") AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
APPLICABLE EXEMPTION FROM REGISTRATION REQUIREMENTS. THE SHARES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED PRIOR TO JANUARY
28, 2001 (OTHER THAN TO AN AFFILIATE OF THE HOLDER) AND THEREAFTER MAY
ONLY BE SOLD IN BROKERS TRANSACTIONS (AS DEFINED IN RULE 144 UNDER THE
ACT) OR TO PERSONS WHO, GIVING EFFECT TO THE SALE OF THE SHARES
REPRESENTED HEREBY, WILL NOT BE THE BENEFICIAL OWNER OF 5% OR MORE OF
THE COMMON STOCK.
(11) Shareholder Rights Plan. The shares of 5-1/4%
Preferred Stock shall be entitled to the benefits of a number of rights
issuable under the Rights Agreement, dated as of October 13, 1993,
between the Company and Continental Stock Transfer & Trust Company or
any successor plan of similar purpose and effect
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("Rights") equal to the number of shares of Common Stock then issuable
upon conversion of the 5-1/4% Preferred Stock at the prevailing
Conversion Rate. Any shares of Common Stock deliverable upon conversion
of a share of 5-1/4% Preferred Stock or upon payment of a dividend
shall be accomplished by a Right.
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