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Exhibit 3.1
ARTICLES OF INCORPORATION
OF
PNC BANK CORP.
[Composite, includes amendments through November 18, 1998.]
FIRST. The name of the Corporation is PNC BANK CORP.
SECOND. The location and post office address of its registered office in
this Commonwealth is 249 Fifth Avenue, One PNC Plaza, Pittsburgh, Pennsylvania
15222-2707.
THIRD. The Corporation is incorporated under the provisions of the Business
Corporation Law, the Act approved May 5, 1933, P. L. 364, as amended. The
purpose of the Corporation is and it shall have unlimited power to engage in and
to do any lawful act concerning any or all lawful business for which
corporations may be incorporated under such Act.
FOURTH. The term of the Corporation's existence is perpetual.
FIFTH. The authority to make, amend and repeal the by-laws of the
Corporation is hereby vested in the Board of Directors, subject to the power of
the shareholders to change any such action.
SIXTH. The aggregate number of shares of capital stock which the Corporation
shall have authority to issue is 470,000,000 shares divided into two classes
consisting of 20,000,000 shares of preferred stock of the par value of $1 each
("Preferred Stock") and 450,000,000 shares of common stock of the par value of
$5 each ("Common Stock").
SEVENTH. The following is a statement of certain of the designations,
preferences, qualifications, privileges, limitations, restrictions, and special
or relative rights in respect of the Preferred Stock and the Common Stock and a
statement of the authority vested in the Board of Directors to fix by resolution
any designations, preferences, privileges, qualifications, limitations,
restrictions and special or relative rights of any series of Preferred Stock
which are not fixed hereby:
PREFERRED STOCK
1. Issuance in series. The shares of Preferred Stock may be issued from time
to time in series. Each series shall be so designated as to distinguish the
shares thereof from the shares of all other series. All shares of any particular
series shall be identical except, if entitled to cumulative dividends, as to the
date or dates from which dividends thereon shall be cumulative. The shares of
any one series need not be identical or rank equally with the shares of any
other series except as required by law or as provided hereby. The Board of
Directors is expressly vested with authority to establish and designate any one
or more series of Preferred Stock and to fix and determine by resolution any
designations, preferences, qualifications, privileges, limitations, restrictions
or special or relative rights of additional series which are not fixed hereby,
including the following:
(a) The number of shares to constitute the series and the distinctive
designation thereof.
(b) The dividend rate, the dates for payment of dividends, whether dividends
shall be cumulative, and, if so, the date or dates from which and the
extent to which dividends shall be cumulative.
(c) The amount or amounts payable upon voluntary or involuntary liquidation
of the Corporation.
(d) The voting rights, if any, of the holders of shares of the series.
(e) The redemption price or prices, if any, and the terms and conditions on
which shares may be redeemed.
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(f) Whether the shares of the series shall be convertible into or
exchangeable for shares of capital stock of the Corporation or other
securities, and, if so, the conversion price or prices or the rate or
rates of conversion or exchange, any adjustments thereof, and any other
terms and conditions of conversion or exchange.
(g) Whether the shares of the series shall be entitled to the benefit of any
retirement or sinking fund to be applied to the purchase or redemption
of such shares, and, if so, the amount thereof and the terms and
conditions relative to the operation thereof.
(h) The rank of the shares of the series, as to dividends and assets, in
relation to the shares of any other class or series of capital stock of
the Corporation.
(i) Such other preferences, qualifications, privileges, limitations,
restrictions or special or relative rights of any series as are not
fixed hereby and as the Board of Directors may deem advisable and state
in such resolutions.
2. Dividends. The holders of shares of each series of Preferred Stock shall
be entitled to receive, when and as declared by the Board of Directors,
dividends at the rate which shall have been fixed hereby or by the Board of
Directors as authorized hereby with respect to such series, and no more except
as shall have been determined by the Board of Directors as authorized hereby. If
dividends on a particular series shall have been determined hereby or by the
Board of Directors as authorized hereby to be cumulative, no dividends shall be
paid or set apart for payment or declared on the Common Stock or on any class or
series of stock of the Corporation ranking as to dividends subordinate to such
series (other than dividends payable in Common Stock or in any class or series
of stock of the Corporation ranking as to dividends and assets subordinate to
such series) and no payment shall be made or set apart for the purchase,
redemption or other acquisition for value of any shares of Common Stock or of
any class or series of stock of the Corporation ranking as to dividends or
assets subordinate to such series, until dividends (to the extent cumulative)
for all past dividend periods on all outstanding shares of such series have been
paid, or declared and set apart for payment, in full. In case dividends for any
dividend period are not paid in full on all shares of Preferred Stock ranking
equally as to dividends, all such shares shall participate ratably in the
payment of dividends for such period in proportion to the full amounts of
dividends to which they are respectively entitled.
3. Liquidation of the Corporation. In the event of voluntary or involuntary
liquidation of the Corporation the holders of shares if each series of Preferred
Stock shall be entitled to receive from the assets of the corporation (whether
capital or surplus), prior to any payment to the holders of Common Stock or of
any class or series of stock of the Corporation ranking as to assets subordinate
to such series, the amount fixed hereby or by the Board of Directors as
authorized hereby for such series, plus, in case dividends on such series shall
have been determined hereby or by the Board of Directors as authorized hereby to
be cumulative, an amount equal to the accrued and unpaid dividends thereon (to
the extent cumulative) computed to the date on which payment thereof is made
available, whether or not earned or declared. After such payment to the holders
of shares of such series, any remaining balance shall be paid to the holders of
Common Stock or of any class or series of stock of the Corporation ranking as to
assets subordinate to such series, as they may be entitled. If, upon liquidation
of the Corporation, its assets are not sufficient to pay in full the amounts so
payable to the holders of shares of all series of Preferred Stock ranking
equally as to assets, all such shares shall participate ratably in the
distribution of assets in proportion to the full amounts to which they are
respectively entitled. Neither a merger nor a consolidation of the Corporation
into or with any other corporation nor a sale, transfer or lease of all or part
of the assets of the Corporation shall be deemed a liquidation of the
Corporation within the meaning of this paragraph.
4. Voting rights.
(a) Except as otherwise required by law, holders of shares of Preferred
Stock shall have only such voting rights, if any, as shall have been
fixed and determined hereby or by the Board of Directors as authorized
hereby. Except as otherwise required by law or as otherwise provided
hereby or by the Board of Directors as authorized hereby, holders of
Preferred Stock having voting rights and holders of Common Stock shall
vote together as one class.
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(b) If the Corporation shall have failed to pay, or declare and set apart
for payment, dividends on all outstanding shares of Preferred Stock in
an amount equal to six quarterly dividends at the rates payable upon
such shares (whether or not such dividends are cumulative), the number
of directors of the Corporation shall be increased by two at the first
annual meeting of the shareholders of the Corporation held thereafter,
and at such meeting and at each subsequent annual meeting until
cumulative dividends payable for all past dividend periods and
continuous noncumulative dividends for at least one year on all
outstanding shares of Preferred Stock entitled thereto shall have been
paid, or declared and set apart for payment, in full, the holders of
shares of Preferred Stock of all series shall have the right, voting as
a class, to elect such two additional members of the Board of Directors
to hold office for a term of one year. Upon such payment, or such
declaration and setting apart for payment, in full, the terms of the two
additional directors so elected shall forthwith terminate, and the
number of directors of the Corporation shall be reduced by two, and such
voting right of the holders of shares of Preferred Stock shall cease,
subject to increase in the number of directors as aforesaid and to
revesting of such voting right in the event of each and every additional
failure in the payment of dividends in an amount equal to six quarterly
dividends as aforesaid.
5. Action by the Corporation requiring approval of Preferred Stock. The
Corporation shall not, without the affirmative vote at a meeting, or at the
written consent with or without a meeting, of the holders of at least two-thirds
of the then outstanding shares of Preferred Stock of all series (a) create or
increase the authorized number of shares of any class of stock ranking as to
dividends or assets prior to the Preferred Stock; or (b) change the preferences,
qualifications, privileges, limitations, restrictions or special or relative
rights granted to or imposed upon the shares of Preferred Stock in any material
respect adverse to the holders thereof, provided that if any such change will
affect any particular series materially and adversely as contrasted with the
effect thereof upon any other series, no such change may be made without, in
addition, such vote or consent of the holders of at least two-thirds of the then
outstanding shares of the particular series which would be so affected.
6. Redemption and acquisition.
(a) Except as otherwise provided by the Board of Directors as authorized
hereby, the Corporation, at its option to be exercised by its Board of
Directors, may redeem the whole or any part of the Preferred Stock or of
any series thereof at such times and at the applicable amount for each
share which shall have been fixed and determined hereby or by the Board
of Directors as authorized hereby with respect thereto, plus, in case
dividends shall have been determined hereby or by the Board of Directors
as authorized hereby to be cumulative, an amount equal to the accrued
and unpaid dividends thereon (to the extent cumulative) computed to the
date fixed for redemption, whether or not earned or declared
(hereinafter collectively called the "redemption price"). If at any time
less than all of the Preferred Stock then outstanding is to be called
for redemption, the Board may select one or more series to be redeemed,
and if less than all the outstanding Preferred Stock of any series is to
be called for redemption, the shares to be redeemed may be selected by
lot or by such other equitable method as the Board in its discretion may
determine. Notice of every redemption, stating the redemption date, the
redemption price, and the place of payment thereof, and, if less than
all of the Preferred Stock then outstanding is called for redemption,
identifying the shares to be redeemed, shall be published at least once
in a newspaper printed in the English language and of general
circulation in the City of Philadelphia, Pennsylvania, or in the Borough
of Manhattan, the City of New York, New York, the first publication to
be not less than 30 nor more than 60 days prior to the date fixed for
redemption. Copies of such notice shall be mailed at least 30 days and
not more than 60 days prior to the date fixed for redemption to the
holders of record of the shares to be redeemed at their addresses as the
same shall appear on the books of the Corporation, but failure to give
such additional notice by mail or any defect therein or failure of any
addressee to receive it shall not affect the validity of the proceedings
for redemption. The Corporation, upon publication of the first notice of
redemption as aforesaid or upon irrevocably authorizing the bank or
trust company hereinafter mentioned to publish such notice as aforesaid,
may deposit or cause to be deposited in trust with a bank or trust
company in the City of Philadelphia, Pennsylvania, or in the Borough of
Manhattan, the City of New York, New York, an amount equal to the
redemption price of the shares to be redeemed, which amount shall be
payable to the holders thereof upon surrender of certificates therefor
on or after
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the date fixed for redemption or prior thereto if so directed by the
Board of Directors. Upon such deposit, or if no such deposit is made
then from and after the date fixed for redemption unless the Corporation
shall default in making payment of the redemption price upon surrender
of the certificates as aforesaid, the shares called for redemption shall
cease to be outstanding and the holders thereof shall cease to be
shareholders with respect to such shares and shall have no interest in
or claim against the Corporation with respect to such shares other than
the right to receive the redemption price from such bank or trust
company or from the Corporation, as the case may be, without interest
thereon, upon surrender of certificates as aforesaid; provided that
conversion rights of shares called for redemption shall terminate at the
close of business on the date fixed for redemption or at such earlier
time as shall have been fixed by the Board of Directors as authorized
hereby. Any funds so deposited which shall not be required for such
redemption because of the exercise of conversion rights subsequent to
the date of such deposit shall be returned to the Corporation. In case
any holder of shares called for redemption shall not, within six years
after the date of such deposit, have claimed the amount deposited with
respect to the redemption thereof, such bank or trust company, upon
demand, shall pay over to the Corporation such unclaimed amount and
shall thereupon be relieved of all responsibility in respect thereof to
such holder, and thereafter such holder shall look only to the
Corporation for payment thereof. Any interest which may accrue on funds
so deposited shall be paid to the Corporation from time to time.
(b) Except as otherwise provided by the Board of Directors as authorized
hereby, the Corporation shall have the right to acquire Preferred Stock
from time to time at such price or prices as the Corporation may
determine, provided that unless dividends (to the extent cumulative)
payable for all past quarterly dividend periods on all outstanding
shares of Preferred Stock entitled to cumulative dividends have been
paid, or declared and set apart for payment, in full, the Corporation
shall not acquire for value any shares of Preferred Stock except in
accordance with an offer (which may vary as to terms offered with
respect to shares of different series but not with respect to shares of
the same series) made in writing or by publication (as determined by the
Board of Directors) to all holders of record of shares of Preferred
Stock.
(c) Except as otherwise provided by the Board of Directors as authorized
hereby, Preferred Stock redeemed or acquired by the Corporation
otherwise than by conversion shall not be canceled or retired except by
action of the Board and shall have the status of authorized and unissued
Preferred Stock which may be reissued by the Board as shares of the same
or any other series until canceled and retired by action of the Board,
but, at the option of the Board, Preferred Stock acquired otherwise than
by redemption or conversion may be held as treasury shares which may be
reissued by the Board until canceled and retired by action of the Board.
$1.80 CUMULATIVE CONVERTIBLE PREFERRED STOCK, SERIES A
7. Designation. A series of Preferred Stock designated $1.80 Cumulative
Convertible Preferred Stock, Series A (Redeemable) (herein called "Series A
Preferred Stock") is hereby established, consisting of 98,583 shares subject to
increase or decrease in the number of shares in accordance with the law.
8. Dividends. The dividend rate of shares of this series shall be $1.80 per
share per year, payable quarterly on the tenth day of each March, June,
September and December. Dividends shall be cumulative from the March 10, June
10, September 10 or December 10 next preceding the date of issue of each share,
unless the date of issue is a quarterly dividend payment date or a date between
the record date for the determination of holders of $1.80 Cumulative Convertible
Preferred Stock of Provident National Corporation, a predecessor of the
Corporation (such stock having been converted into the Series A Preferred
Stock), entitled to receive a quarterly dividend and the date of payment of such
quarterly dividend, in either of which events such dividends shall be cumulative
from such quarterly dividend payment date.
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9. Liquidation. The amount payable upon shares of Series A Preferred Stock
in the event of voluntary or involuntary liquidation of the Corporation, prior
to any payment to the holders of Common Stock or of any class or series of stock
of the Corporation ranking as to assets subordinate to the Series A Preferred
Stock, shall be $40.00 per share plus an amount equal to accrued and unpaid
dividends thereon computed to the date on which payment thereof is made
available, whether or not earned or declared.
10. Redemption. Shares of Series A Preferred Stock shall be redeemable at
any time at $40.00 per share plus an amount equal to accrued and unpaid
dividends thereon computed to the date fixed for redemption, whether or not
earned or declared.
11. Voting rights. Each holder of record of Series A Preferred Stock shall
have the right to a number of votes equal to the number of full shares of Common
Stock into which the share or shares of Series A Preferred Stock standing in his
name on the books of the Corporation are at the time convertible.
12. Conversion provisions.
(a) Shares of Series A Preferred Stock may, at the option of the holder, be
converted into Common Stock of the Corporation (as such stock may be
constituted on the conversion date) at the rate of two shares of Common
Stock for each share of Series A Preferred Stock, subject to adjustment
as provided herein; provided that, as to any shares of Series A
Preferred Stock which shall have been called for redemption, the
conversion right shall terminate at the close of business on the date
fixed for redemption.
(b) The holder of a share or shares of Series A Preferred Stock may exercise
the conversion right as to any thereof by delivering to the Corporation,
during regular business hours, at its principal office or at the office
of any of its transfer agents for the Series A Preferred Stock or at
such other place as may be designated by the Corporation, the
certificate or certificates for the shares to be converted, duly
endorsed or assigned in blank or to the Corporation (if required by it),
accompanied by written notice stating that the holder elects to convert
such shares and stating the name or names (with address) in which the
certificate or certificates for Common Stock are to be issued.
Conversion shall be deemed to have been effected on the date when such
delivery is made, and such date is referred to herein as the "conversion
date". As promptly as practicable thereafter the Corporation shall issue
and deliver to or upon the written order of such holder, at such office
or other place designated by the Corporation, a certificate or
certificates for the number of full shares of Common Stock to which he
is entitled and a check, cash, scrip certificate or other adjustment in
respect of any fraction of a share as provided in section 12(d) below.
The person in whose name the certificate or certificates for Common
Stock are to be issued shall be deemed to have become a holder of such
Common Stock of record on the conversion date unless the transfer books
of the Corporation are closed on that date, in which event he shall be
deemed to have become a holder of such Common Stock of record on the
next succeeding date on which the transfer books are open, but the
conversion rate shall be that in effect on the conversion date.
(c) No payment or adjustment shall be made for dividends accrued on any
shares of Series A Preferred Stock converted or for dividends on any
shares of Common Stock issuable on conversion.
(d) The Corporation shall not be required to issue any fraction of a share
upon conversion of any share or shares of Series A Preferred Stock. If
more than one share of Series A 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 total number of shares of Series A Preferred Stock so
surrendered. If any fractional interest in a share of Common Stock would
be deliverable upon conversion, the Corporation shall make an adjustment
therefor in cash unless its Board of Directors shall have determined to
adjust fractional interests by issuance of scrip certificates or in some
other manner. Adjustment in cash shall be made on the basis of the
current market value of one share of Common Stock, which shall be taken
to be the last reported sale price of the Corporation's Common Stock on
the principal stock exchange on which the Common Stock is then listed on
the last business day before the conversion date or, if there was no
reported sale on that day, the average of the closing bid and asked
quotations on that exchange on that day or, if the Common Stock is not
then listed on any stock exchange, the average of the lowest bid and the
highest asked quotations in the over-the-counter market on that day.
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(e) The issuance of Common Stock on conversion of Series A Preferred Stock
shall be without charge to the converting holder of Series A Preferred
Stock for any tax in respect of the issuance thereof, but the
Corporation shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of shares
in any name other than that of the holder of record on the books of the
Corporation of the shares of Series A Preferred Stock converted, and the
Corporation shall not be required to issue or deliver any certificate
for shares of Common Stock unless and until the person requesting the
issuance thereof shall have paid to the Corporation the amount of such
tax or shall have established to the satisfaction of the Corporation
that such tax has been paid.
(f) The conversion rate provided the section 12(a) shall be subject to the
following adjustments, which shall be made to the nearest one-hundredth
of a share of Common Stock or, if none, to the next lower one-hundredth:
(1) If the Corporation shall pay to the holders of its Common Stock a
dividend in the shares of Common Stock, the conversion rate in effect
immediately prior to the record date fixed for the determination of the
holders of Common Stock entitled to such dividend shall be proportionately
increased, effective at the opening of business on the next following full
business day.
(2) If the Corporation shall split the outstanding shares of its Common
Stock into a greater number of shares or combine the outstanding shares into
a smaller number, the conversion rate in effect immediately prior to such
action shall be proportionately increased in the case of a split or
decreased in the case of a combination, effective at the opening of business
on the full business day next following the day such action becomes
effective.
(3) If the Corporation shall issue to the holders of its Common Stock
rights or warrants to subscribe for or purchase shares of its Common Stock
at a price of less than 90% of the Current Market Price (as defined below in
this paragraph) of the Corporation's Common Stock at the record date fixed
for the determination of the holders of Common Stock entitled to such rights
or warrants, the conversion rate in effect immediately prior to said record
date shall be increased, effective at the opening of business on the next
following full business day, to an amount determined by multiplying such
conversion rate by a fraction the numerator of which is the number of shares
of Common Stock of the Corporation outstanding immediately prior to said
record date plus the number of additional shares of its Common Stock offered
for subscription or purchase and the denominator of which is said number of
shares outstanding immediately prior to said record date plus the number of
shares of Common Stock of the Corporation which the aggregate subscription
or purchase price of the total number of shares so offered would purchase at
the Current Market Price of the Corporation's Common Stock at said record
date. The term "Current Market Price" at said record date shall mean the
average of the daily last reported sale prices per share of the
Corporation's Common Stock on the principal stock exchange on which the
Common Stock is then listed during the 20 consecutive full business days
commencing with the 30th full business day before said record date, provided
that if there was no reported sale on any such day or days there shall be
substituted the average of the closing bid and asked quotations on that
exchange on that day, and provided further that if the Common Stock was not
listed on any stock exchange on any such day or days there shall be
substituted the average of the lowest bid and the highest asked quotations
in the over-the-counter market on that day.
(g) No adjustment of the conversion rate provided in section 12(a) shall be
made by reason of the issuance of Common Stock for cash except as
provided in section 12(f) (3), or by reason of the issuance of Common
Stock for property or services. Whenever the conversion rate is adjusted
pursuant to section 12(f) the Corporation shall (1) promptly place on
file at its principal office and at the office of each of its transfer
agents for the Series A Preferred Stock a statement signed by the
Chairman of the Board, the President or a Vice President of the
Corporation and by its Treasurer or an Assistant Treasurer showing in
detail the facts requiring such adjustment and the conversion rate after
such adjustment, and shall make such statement available for inspection
by shareholders of the Corporation, and (2) cause a notice
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to be published at lease once in a newspaper printed in the English
language and of general circulation in the City of Philadelphia,
Pennsylvania, or in the Borough of Manhattan, the City of New York, New
York, stating that such adjustment has been made and the adjusted
conversion rate.
(h) If the Corporation shall issue to the holders of its Common Stock rights
or warrants to subscribe for or purchase shares of its Common Stock or
any other security, or if the Corporation shall distribute to the
holders of its Common Stock any evidences of indebtedness or any other
assets (excluding dividends and distributions in cash), the Corporation
shall mail to each holder of record of a share or shares of Series A
Preferred Stock, at his address as it shall appear on the books of the
Corporation, a notice stating the record date fixed or to be fixed for
the determination of the holders of Common Stock of record entitled to
such issuance or distribution. Such notice shall be mailed at least 10
days before such record date. Failure to mail such notice or any defect
therein or failure of any addressee to receive it shall not affect the
validity of such issuance or distribution or any vote thereon.
(i) In case of any reclassification or change in the outstanding shares of
Common Stock of the Corporation (except a split or combination of
shares) or in case of any consolidation or merger to which the
Corporation is a party (except a merger in which the Corporation is the
surviving corporation and which does not result in any reclassification
of or change in the outstanding Common Stock of the Corporation except a
split or combination of shares) or in case of any sale or conveyance to
another corporation of all or substantially all of the property of the
Corporation, effective provision shall be made by the Corporation or by
the successor or purchasing corporation (1) that the holder of each
share of Series A Preferred stock then outstanding shall thereafter have
the right to convert such share into the kind and amount of stock and
other securities and property receivable upon such reclassification,
change, consolidation, merger, sale or conveyance by a holder of the
number of shares of Common Stock of the Corporation into which such
share of Series A Preferred Stock might have been converted immediately
prior thereto and (2) that there shall be subsequent adjustments of the
conversion rate which shall be equivalent, as nearly as practicable, to
the adjustments provided for in section 12(f). The provisions of this
section 12(i) shall similarly apply to successive reclassifications,
changes, consolidations, mergers, sales or conveyances.
(j) Shares of Common Stock issued on conversion of shares of Series A
Preferred Stock shall be issued as fully paid shares and shall be
nonassessable by the Corporation. The Corporation shall at all times
reserve and keep available for the purpose of effecting the conversion
of Series A Preferred Stock, such number of its duly authorized shares
of Common Stock as shall be sufficient to effect the conversion of all
outstanding shares of Series A Preferred Stock.
(k) Shares of Series A Preferred Stock converted as provided herein shall
not be reissued.
$1.80 CUMULATIVE CONVERTIBLE PREFERRED STOCK, SERIES B
13. Designation. A series of Preferred Stock designated $1.80 Cumulative
Convertible Preferred Stock, Series B (Nonredeemable) (herein called "Series B
Preferred Stock") is hereby established consisting of 38,542 shares subject to
increase or decrease in the number of shares in accordance with law.
14. Dividends. The dividend rate of shares of Series B Preferred Stock shall
be $1.80 per share per year, payable quarterly on the tenth day of each March,
June, September and December. Dividends shall be cumulative from the March 10,
June 10, September 10 or December 10 next preceding the date of issue of each
share, unless the date if issue is a quarterly dividend payment date or a date
between the record date for the determination of holders of $1.80 Cumulative
Convertible Preferred Stock, 1971 Series, of Provident National Corporation, a
predecessor of the Corporation (such stock having been converted in the Series B
Preferred Stock), entitled to receive a quarterly dividend and the date of
payment of such quarterly dividend, in either of which events such dividends
shall be cumulative from such quarterly dividend payment date.
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15. Liquidation. The amount payable upon shares of Series B Preferred Stock
in the event of voluntary or involuntary liquidation of the Corporation, prior
to any payment to the holders of Common Stock or of any class or series of stock
of the Corporation ranking as to assets subordinate to the Series B Preferred
Stock, shall be $40.00 per share plus an amount equal to accrued and unpaid
dividends thereon computed to the date on which payment thereof is made
available, whether or not earned or declared.
16. Rank. The Series B Preferred Stock shall rank, as to dividends and
assets, equally with the series of Preferred Stock of the Corporation designated
as $1.80 Cumulative Convertible Preferred Stock, Series A (Redeemable).
17. Redemption. Shares of Series B Preferred stock shall not be redeemable.
18. Voting rights. Each holder of record of Series B Preferred Stock shall
have the right to a number of votes equal to the number of full shares of Common
Stock into which the share or shares of Series B Preferred Stock standing in his
name on the books of the Corporation are at the time convertible.
19. Conversion provisions.
(a) Shares of Series B Preferred Stock may, at the option of the holder, be
converted into Common Stock of the Corporation (as such stock may be
constituted on the conversion date) at the rate of two shares of Common
Stock for each share of Series B Preferred Stock, subject to adjustment
as provided herein.
(b) The holder of a share or shares of Series B Preferred Stock may exercise
the conversion right as to any thereof by delivering to the Corporation
during regular business hours, at its principal office or at the office
of any of its transfer agents for the Series B Preferred Stock or at
such other place as may be designated by the Corporation, the
certificate or certificates for the shares to be converted, duly
endorsed or assigned in blank or to the Corporation (if required by it),
accompanied by written notice stating that the holder elects to convert
such shares and stating the name or names (with address) in which the
certificate or certificates for Common Stock are to be issued.
Conversion shall be deemed to have been effected on the date when such
delivery is made, and such date is referred to herein as the "conversion
date". As promptly as practicable thereafter the Corporation shall issue
and deliver to or upon the written order of such holder, at such office
or other place designated by the Corporation, a certificate or
certificates for the number of full shares of Common Stock to which he
is entitled and a check, cash, scrip certificate or other adjustment in
respect of any fraction of a share as provided in section 19(d) below.
The person in whose name the certificate or certificates for Common
Stock are to be issued shall be deemed to have become a holder of such
Common Stock of record on the conversion date unless the transfer books
of the Corporation are closed on that date, in which event he shall be
deemed to have become a holder of such Common Stock of record on the
next succeeding date on which the transfer books are open, but the
conversion rate shall be that in effect on the conversion date.
(c) No payment or adjustment shall be made for dividends accrued on any
shares of Series B Preferred Stock converted or for dividends on any
shares of Common stock issuable on conversion.
(d) The Corporation shall not be required to issue any fraction of a share
upon conversion of any share or shares of Series B Preferred Stock. If
more than one share of Series B 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 total number of shares of Series B Preferred Stock so
surrendered. If any fractional interest in a share of Common Stock would
be deliverable upon conversion, the Corporation shall make an adjustment
therefor in cash unless its Board of Directors shall have determined to
adjust fractional interests by issuance of scrip certificates or in some
other manner. Adjustment in cash shall be made on the basis of the
current market value of one share of Common Stock, which shall be taken
to be the last reported sale price of the Corporation's Common Stock on
the principal stock exchange on which the Common Stock is then listed on
the last business day before the conversion date or, if there was no
reported sale on that day, the average of the closing bid and asked
quotations on that exchange on that day or, if the Common Stock is not
then listed on any stock exchange, the average of the lowest bid and the
highest asked quotations in the over-the-counter market on that day.
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(e) The issuance of Common Stock on conversion of Series B Preferred Stock
shall be without charge to the converting holder of Series B Preferred
Stock for any tax in respect of the issuance thereof, but the
Corporation shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of shares
in any name other than that of the holder or record on the books of the
Corporation of the shares of Series B Preferred Stock converted, and the
Corporation shall not be required to issue or deliver any certificate
for shares of Common Stock unless and until the person requesting the
issuance thereof shall have paid to the Corporation the amount of such
tax or shall have established to the satisfaction of the Corporation
that such tax has been paid.
(f) The conversion rate provided the section 19(a) above shall be subject to
the following adjustments, which shall be made to the nearest
one-hundredth of a share of Common Stock or, if none, to the next lower
one-hundredth:
(1) If the Corporation shall pay to the holders of its Common Stock a
dividend in the shares of Common Stock, the conversion rate in effect
immediately prior to the record date fixed for the determination of the
holders of Common Stock entitled to such dividend shall be proportionately
increased, effective at the opening of business on the next following full
business day.
(2) If the Corporation shall split the outstanding shares of its Common
stock into a greater number of shares of combine the outstanding shares into
a smaller number, the conversion rate in effect immediately prior to such
action shall be proportionately increased in the case of a split or
decreased in the case of a combination, effective at the opening of business
on the full business day next following the day such action becomes
effective.
(3) If the Corporation shall issue to the holders of its Common Stock
rights or warrants to subscribe for or purchase shares of its Common Stock
at a price of less than 90% of the Current Market Price (as defined below in
this paragraph) of the Corporation's Common Stock at the record date fixed
for the determination of the holders of Common Stock entitled to such rights
or warrants, the conversion rate in effect immediately prior to said record
date shall be increased, effective at the opening of business on the next
following full business day, to an amount determined by multiplying such
conversion rate by a fraction the numerator of which is the number of shares
of Common Stock of the Corporation outstanding immediately prior to said
record date plus the number of additional shares of its Common Stock offered
for subscription or purchase and the denominator of which is said number of
shares outstanding immediately prior to said record date plus the number of
shares of Common Stock of the Corporation which the aggregate subscription
or purchase price of the total number of shares so offered would purchase at
the Current Market Price of the Corporation's Common Stock at said record
date. The term "Current Market Price" at said record date shall mean the
average of the daily last reported sale prices per share of the
Corporation's Common Stock on the principal stock exchange on which the
Common Stock is then listed during the 20 consecutive full business days
commencing with the 30th full business day before said record date, provided
that if there was no reported sale on any such day or days there shall be
substituted the average of the closing bid and asked quotations on that
exchange on that day, and provided further that if the Common Stock was not
listed on any stock exchange on any such day or days there shall be
substituted the average of the lowest bid and the highest asked quotations
in the over-the-counter market on that day.
(g) No adjustment of the conversion rate provided in section 19(a) above
shall be made by reason of the issuance of Common Stock for cash except
as provided in section 19(f)(3) above, or by reason of the issuance of
Common Stock for property or services. Whenever the conversion rate is
adjusted pursuant to section 19(f) above the Corporation shall (1)
promptly place on file at its principal office and at the office of each
of its transfer agents for the Series B Preferred Stock a statement
signed by the Chairman of the Board, the President or a Vice President
of the Corporation and by its Treasurer or an Assistant Treasurer
showing in detail the facts requiring such adjustment and the conversion
rate after such adjustment, and shall make such statement available for
inspection by shareholders of the Corporation,
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and (2) cause a notice to be published at least once in a newspaper
printed in the English language and of general circulation in the City
of Philadelphia, Pennsylvania, or in the Borough of Manhattan, the City
of New York, New York, stating that such adjustment has been made and
the adjusted conversion rate.
(h) If the Corporation shall issue to the holders of its Common Stock rights
or warrants to subscribe for or purchase shares of its Common Stock or
any other security, or if the Corporation shall distribute to the
holders of its Common Stock any evidences of indebtedness of any other
assets (excluding dividends and distributions in cash), the Corporation
shall mail to each holder of record of a share or shares of Series B
Preferred Stock, at his address as it shall appear on the books of the
Corporation, a notice stating the record date fixed or to be fixed for
the determination of the holders of Common Stock of record entitled to
such issuance or distribution. Such notice shall be mailed at least 10
days before such record date. Failure to mail such notice or any defect
therein or failure of any addressee to receive it shall not affect the
validity of such issuance or distribution of any vote thereon.
(i) In case of any reclassification or change of the outstanding shares of
Common Stock of the Corporation (except a split or combination of
shares) or in case of any consolidation or merger to which the
Corporation is a party (except a merger in which the Corporation is the
surviving corporation and which does not result in any reclassification
of or change in the outstanding Common Stock of the Corporation except a
split or combination of shares) or in case of any sale or conveyance to
another corporation of all or substantially all of the property of the
Corporation, effective provision shall be made by the Corporation or by
the successor or purchasing corporation (1) that the holder of each
share of Series B Preferred Stock then outstanding shall thereafter have
the right to convert such share into the kind and amount of stock and
other securities and property receivable upon such reclassification,
change, consolidation, merger, sale or conveyance by a holder of the
number of shares of Common Stock of the Corporation into which such
share of Series B Preferred Stock might have been converted immediately
prior thereto, and (2) that there shall be subsequent adjustments of the
conversion rate which shall be equivalent, as nearly as practicable, to
the adjustments provided for in section 19(f) above. The provisions of
this section 19(i) shall similarly apply to successive
reclassifications, changes, consolidations, mergers, sales or
conveyances.
(j) Shares of Common Stock issued on conversion of shares of Series B
Preferred Stock shall be issued as fully paid shares and shall be
nonassessable by the Corporation. The Corporation shall at all times
reserve and keep available for the purpose of effecting the conversion
of Series B Preferred Stock, such number of its duly authorized shares
of Common Stock as shall be sufficient to effect the conversion of all
outstanding shares of Series B Preferred Stock.
(k) Shares of Series B Preferred Stock converted as provided herein shall
not be reissued.
20. Retirement or sinking fund. The shares of Series B Preferred Stock shall
not be entitled to the benefit of any retirement or sinking fund to be applied
to the purchase or redemption of such shares.
COMMON STOCK
21. Each holder of record of Common Stock shall have the right to one vote
for each share of Common Stock standing in his name on the books of the
Corporation.
PROVISIONS APPLICABLE TO ALL CLASSES OF CAPITAL STOCK
22. No holder of any class of capital stock of the Corporation shall be
entitled to cumulate his votes for the election of directors.
23. No holder of any class of capital stock of the Corporation shall have
preemptive rights, and the Corporation shall have the right to issue and to sell
to any person or persons any shares of its capital stock or any option rights or
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any securities having conversion or option rights, without first offering such
shares, rights or securities to any holders of any class of capital stock of the
Corporation.
[The following text contains resolutions of the Corporation's Board of
Directors relating to additional authorized and outstanding series of Preferred
Stock.]
RESOLVED, that a third series of Preferred Stock, par value $1.00 of the
Corporation is hereby established and that the shares of said series shall have,
in addition to the preferences, qualifications, privileges, limitations,
restrictions and special or relative rights in respect of Preferred Stock
granted or created by law and by the Corporation's Articles of Incorporation,
the following preferences, qualifications, privileges, limitations, restrictions
and special or relative rights which are hereby fixed and determined:
1. Designation. A series of Preferred Stock designated "$1.60 Cumulative
Convertible Preferred Stock, Series C" (herein called "Series C Preferred
Stock") is hereby established, consisting of 1,433,935 shares subject to
increase or decrease in the number of shares in accordance with the law.
2. Rank. Series C Preferred Stock shall rank, as to dividends and assets,
equally with the Series A Preferred Stock and the Series B Preferred Stock and
every other share of capital stock from time to time outstanding which is not
Common Stock of the Corporation and which is not specifically made senior or
subordinate to the Series C Preferred Stock as to dividends or assets.
3. Dividends. The dividend rate of shares of this series shall be $1.60 per
share per year, payable in equal quarterly installments on the first day of each
January, April, July and October. Dividends shall be cumulative from the January
1, April 1, July 1 and October 1 next preceding the date of issue of each share,
unless the date of issue is a quarterly dividend payment date or a date between
the record date for the determination of holders of record of Series C Preferred
Stock entitled to receive a quarterly dividend and the date of payment of such
quarterly dividend, in either of which events such dividends shall be cumulative
from such dividend payment date.
4. Liquidation. The amount payable upon shares of Series C Preferred Stock
in the event of voluntary or involuntary liquidation of the Corporation, prior
to any payment to the holders of Common Stock or of any class or series of stock
of the Corporation ranking as to assets subordinate to the Series C Preferred
Stock, shall be $20.00 per share plus an amount equal to accrued and unpaid
dividends thereon computed to the date on which payment thereof is made
available, whether or not earned or declared.
5. Redemption. Shares of Series C Preferred Stock shall be redeemable at any
time after [insert the first day of the month following the fifth anniversary of
the Effective Date of the Merger] at $20.00 per share plus an amount equal to
accrued and unpaid dividends thereon computed to the date fixed for redemption,
whether or not earned or declared.
6. Voting rights. Each holder of record of Series C Preferred Stock shall
have the right to a number of votes equal to the number of full shares of Common
Stock into which the share or shares of Series C Preferred Stock standing in his
name on the books of the Corporation are at the time convertible.
7. Conversion provisions.
(a) Shares of Series C Preferred Stock may, at the option of the holder, be
converted into Common Stock of the Corporation (as such stock may be
constituted on the conversion date) at the conversion price, determined
as hereinafter provided, in effect at the time of conversion, subject to
adjustment as provided herein; provided that, as to any shares of Series
C Preferred Stock which shall have been called for redemption, the
conversion right shall terminate at the close of business on the date
fixed for redemption. The value of each share on Series C Preferred
Stock for the purpose of such conversion shall be $20.00. The price at
which shares of Common Stock of the Corporation shall be delivered upon
conversion (herein called the "conversion price") shall initially be
$48.00 per share of Common Stock of the Corporation.
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(b) The holder of a share or shares of Series C Preferred Stock may exercise
the conversion right as to any thereof by delivering to the Corporation,
during regular business hours, at its principal office or at the office
of any of its transfer agents for the Series C Preferred Stock or at
such other place as may be designated by the Corporation, the
certificate or certificates for the shares to be converted, duly
endorsed or assigned in blank or to the Corporation (if required by it),
accompanied by written notice stating that the holder elects to convert
such shares and stating the name or names (with address) in which the
certificate or certificates for Common Stock are to be issued.
Conversion shall be deemed to have been effected on the date when such
delivery is made, and such date is referred to herein as the "conversion
date". As promptly as is practicable thereafter the Corporation shall
issue and deliver to or upon the written order of such holder, at such
office or other place designated by the Corporation, a certificate or
certificates for the number of full shares of Common Stock to which he
is entitled and cash, scrip certificate or other adjustment in respect
of any fraction of a share as provided in section 7(d) below. The person
in whose name the certificate or certificates for Common Stock are to be
issued shall be deemed to have become a holder of such Common Stock of
record on the conversion date unless the transfer books of the
Corporation are closed on that date, in which event he shall be deemed
to have become a holder of such Common Stock of record on the next
succeeding date on which the transfer books are open, but the conversion
price shall be that in effect on the conversion date.
(c) No payment or adjustment shall be made for dividends accrued on any
shares of Series C Preferred Stock converted or for dividends on any
shares of Common Stock issuable on conversion.
(d) The Corporation shall not be required to issue any fraction of a share
upon conversion of any share or shares of Series C Preferred Stock. If
more than one share of Series C 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 total number of shares of Series C Preferred Stock so
surrendered. If any fractional interest in a share of Common Stock would
be deliverable upon conversion, the Corporation shall make an adjustment
therefor in cash unless its Board of Directors shall have determined to
adjust fractional interests by issuance of scrip certificates or in some
other manner. Adjustment in cash shall be made on the basis of the
current market value of one share of Common Stock, which shall be taken
to be the last reported sale price of the Corporation's Common Stock on
the principal stock exchange on which the Common Stock is then listed
(or if not so listed, on the over-the-counter market) for the last
business day before the conversion date or, if there was no reported
sale on that day, the last reported sales price on the first preceding
day for which such price is available.
(e) The issuance of Common Stock on conversion of Series C Preferred Stock
shall be without charge to the converting holder of Series C Preferred
Stock for any tax in respect of the issuance thereof, but the
Corporation shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of shares
in any name other than that of the holder of record on the books of the
Corporation of the shares of Series C Preferred Stock converted, and the
Corporation shall not be required to issue or deliver any certificate
for shares of Common Stock unless and until the person requesting the
issuance thereof shall have paid to the Corporation the amount of such
tax or shall have established to the satisfaction of the Corporation
that such tax has been paid.
(f) The conversion price provided in section 7(a) shall be subject to the
following adjustments, which shall be made to the nearest cent:
(1) If the Corporation shall pay to the holders of its Common Stock a
dividend in the shares of Common Stock, the conversion rate in effect
immediately prior to the record date fixed for the determination of the
holders of Common Stock entitled to such dividend shall be proportionately
decreased, effective at the opening of business on the next following full
business day.
(2) If the Corporation shall split the outstanding shares of its Common
stock into a greater number of shares or combine the outstanding shares into
a smaller number, the conversion price in effect immediately prior to such
action shall be proportionately decreased in the case of a split or
increased in the case of
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a combination, effective at the opening of business on the full business day
next following the day such action becomes effective.
(3) If the Corporation shall issue to the holders of its Common Stock
rights or warrants to subscribe for or purchase shares of its Common Stock
at a price of less than 90% of the Current Market Price (as defined below in
this paragraph) of the Corporation's Common Stock at the record date fixed
for the determination of the holders of Common Stock entitled to such rights
or warrants, the conversion price in effect immediately prior to said record
date shall be adjusted, effective at the opening of business on the next
following full business day, to an amount determined by multiplying such
conversion rate by a fraction the numerator of which is the number of shares
of Common Stock of the Corporation outstanding immediately prior to said
record date plus the number of shares of Common Stock of the Corporation
which the aggregate subscription or purchase price of the total number of
shares so offered would purchase at the Current Market Price of the
Corporation's Common Stock at said record date and the denominator of which
is said number of shares outstanding immediately prior to said record date
plus the number of additional shares of its Common Stock offered for
subscription or purchase. The term "Current Market Price" at said record
date shall mean the average of the daily last reported sale prices per share
of the Corporation's Common Stock on the principal stock exchange on which
the Common Stock is then listed (or if not so listed, then on the
over-the-counter market) during 20 consecutive full business days commencing
with the 30th full business day before said record date, provided that if
there was no reported sale on any such day or days there shall be
substituted the average of the closing bid and asked quotations on that day
obtained from the market specialist assigned to the Corporation (or a market
maker in the case of the over-the-counter market).
(4) The Corporation may make such reductions in the conversion price,
in addition to those required by the foregoing provisions, as it considers
to be advisable in order that any event treated for federal income tax
purposes as a dividend of stock or stock rights shall not be taxable to the
recipients.
(g) No adjustment of the conversion rate provided in section 7(a) shall be
made by reason of the issuance of Common Stock for cash except as
provided in section 7(f)(3), or by reason of the issuance of Common
Stock for property or services. Whenever the conversion rate is adjusted
pursuant to section 7(f) the Corporation shall (1) promptly place on
file at its principal office and at the office of each of its transfer
agents for the Series C Preferred Stock a statement signed by the
Chairman of the Board, the President or a Vice President of the
Corporation and by its Treasurer or an Assistant Treasurer showing in
detail the facts requiring such adjustment and the conversion price
after such adjustment, and shall make such statement available for
inspection by shareholders on the Corporation, and (2) cause a notice to
be published at least once in a newspaper printed in the English
language and of general circulation in the City of Erie, Pennsylvania,
and in the Borough of Manhattan, the City of New York, New York, stating
that such adjustment has been made and the adjusted conversion price.
(h) If the Corporation shall issue to the holders of its Common Stock rights
or warrants to subscribe for or purchase shares of its Common Stock or
any other security, or if the Corporation shall distribute to the
holders of its Common Stock any evidences of indebtedness of any other
assets (excluding dividends and distributions in cash), the Corporation
shall mail to each holder of record of a share or shares of Series C
Preferred Stock, at his address as it shall appear on the books of the
Corporation, a notice stating the record date fixed or to be fixed for
the determination of the holders of Common Stock of record entitled to
such issuance or distribution. Such notice shall be mailed at least 10
days before such record date. Failure to mail such notice or any defect
therein or failure of any addressee to receive it shall not affect the
validity of such issuance or distribution of any vote thereon.
(i) In case of any reclassification or change of the outstanding shares of
Common Stock of the Corporation (except a split or combination of
shares) or in case of any consolidation or merger to which the
Corporation is a party (except a merger in which the Corporation is the
surviving corporation and which does not result in any reclassification
of or change in the outstanding Common Stock of the Corporation except
an increase in the number of outstanding shares or a split or
combination of shares) or in case of
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any sale or conveyance to another corporation of all or substantially
all of the property of the Corporation, effective provision shall be
made by the Corporation or by the successor or purchasing corporation
(1) that the holder of each share of Series C Preferred Stock then
outstanding shall thereafter have the right to convert such share into
the kind and amount of stock and other securities and property
receivable upon such reclassification, change, consolidation, merger,
sale or conveyance by a holder of the number of shares of Common Stock
of the Corporation into which such share of Series C Preferred Stock
might have been converted immediately prior thereto, and (2) that there
shall be subsequent adjustments of the conversion price which shall be
equivalent, as nearly as practicable, to the adjustments provided for in
section 7(f). The provisions of this section 7(i) shall similarly apply
to successive reclassifications, changes, consolidations, mergers, sales
or conveyances.
(j) Shares of Common Stock issued on conversion of shares of Series C
Preferred Stock shall be issued as fully paid shares and shall be
nonassessable by the Corporation. The Corporation shall at all times
reserve and keep available for the purpose of effecting the conversion
of Series C Preferred Stock, such number of its duly authorized shares
of Common Stock as shall be sufficient to effect the conversion of all
outstanding shares of Series C Preferred Stock.
(k) Shares of Series C Preferred Stock converted as provided herein shall
not be reissued.
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RESOLVED, that a fourth series of Preferred Stock, par value $1.00 of the
Corporation is hereby established and that the shares of said series shall have,
in addition to the preferences, qualifications, privileges, limitations,
restrictions and special or relative rights in respect of Preferred Stock
granted or created by law and by the Corporation's Articles of Incorporation,
the following preferences, qualifications, privileges, limitations, restrictions
and special or relative rights which are hereby fixed and determined.
1. Designation. A series of Preferred Stock designated "$1.80 Cumulative
Convertible Preferred Stock, Series D" (herein called "Series D Preferred
Stock") is hereby established, consisting of 1,766,140 shares subject to
increase or decrease in the number of shares in accordance with the law.
2. Rank. Series D Preferred Stock shall rank, as to dividends and assets,
equally with the Series A Preferred Stock, the Series B Preferred Stock and the
Series C Preferred Stock and every other share of capital stock from time to
time outstanding which is not Common Stock of the Corporation and which is not
specifically made senior or subordinate to the Series D Preferred Stock as to
dividends or assets.
3. Dividends. The dividend rate of shares of this series shall be $1.80 per
share per year, payable in equal quarterly installments on the first day of each
January, April, July and October. Dividends shall be cumulative from the January
1, April 1, July 1 and October 1 next preceding the date of issue of each share,
unless the date of issue is a quarterly dividend payment date or a date between
the record date for the determination of holders of record of the Series D
Preferred Stock entitled to receive a quarterly dividend and the date of payment
of such quarterly dividend, in either of which events such dividends shall be
cumulative from such dividend payment date.
4. Liquidation. The amount payable upon shares of Series D Preferred Stock
in the event of voluntary or involuntary liquidation of the Corporation, prior
to any payment to the holders of Common Stock or of any class or series of stock
of the Corporation ranking as to assets subordinate to the Series D Preferred
Stock, shall be $20.00 per share plus an amount equal to accrued and unpaid
dividends thereon computed to the date on which payment thereof is made
available, whether or not earned or declared.
5. Redemption. Shares of Series D Preferred Stock shall be redeemable at any
time after [insert the first day of the month following the fifth anniversary of
the Effective Date of the Merger] at $20.00 per share plus an amount equal to
the accrued and unpaid dividends thereon computed to the date fixed for
redemption, whether or not earned or declared.
6. Voting rights. Each holder of record of Series D Preferred Stock shall
have the right to a number of votes equal to the number of full shares of Common
Stock into which the share or shares of Series D Preferred Stock standing in his
name on the books of the Corporation are at the time convertible.
7. Conversion provisions.
(a) Shares of Series D Preferred Stock may, at the option of the holder, be
converted into Common Stock of the Corporation (as such stock may be
constituted on the conversion date) at the conversion price, determined
as hereinafter provided, in effect at the time of conversion, subject to
adjustment as provided herein; provided that, as to any shares of Series
D Preferred Stock which shall have been called for redemption, the
conversion right shall terminate at the close of business on the date
fixed for redemption. The value of each share on Series D Preferred
Stock for the purpose of such conversion shall be $20.00. The price at
which shares of Common Stock of the Corporation shall be delivered upon
conversion (herein called the "conversion price") shall initially be
$48.00 per share of Common Stock of the Corporation.
(b) The holder of a share or shares of Series D Preferred Stock may exercise
the conversion right as to any thereof by delivering to the Corporation,
during regular business hours, at its principal office or at the office
of any of its transfer agents for the Series D Preferred Stock or at
such other place as may be designated by the Corporation, the
certificate or certificates for the shares to be converted, duly
endorsed or assigned in blank or to the Corporation (if required by it),
accompanied by written notice stating that the holder elects to convert
such shares and stating the name or names (with address) in which the
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certificate or certificates for Common Stock are to be issued.
Conversion shall be deemed to have been effected on the date when such
delivery is made, and such date is referred to herein as the "conversion
date". As promptly as practicable thereafter the Corporation shall issue
and deliver to or upon the written order of such holder, at such office
or other place designated by the Corporation, a certificate or
certificates for the number of full shares of Common Stock to which he
is entitled and cash, scrip certificate or other adjustment in respect
of any fraction of a share as provided in section 7(d) below. The person
in whose name the certificate or certificates for Common Stock are to be
issued shall be deemed to have become a holder of such Common Stock of
record on the conversion date unless the transfer books of the
Corporation are closed on that date, in which event he shall be deemed
to have become a holder of such Common Stock of record on the next
succeeding date on which the transfer books are open, but the conversion
price shall be that in effect on the conversion date.
(c) No payment or adjustment shall be made for dividends accrued on any
shares of Series D Preferred Stock converted or for dividends on any
shares of Common Stock issuable on conversion.
(d) The Corporation shall not be required to issue any fraction of a share
upon conversion of any share or shares of Series D Preferred Stock. If
more than one share of Series D 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 total number of shares of Series D Preferred Stock so
surrendered. If any fractional interest in a share of Common Stock would
be deliverable upon conversion, the Corporation shall make an adjustment
therefor in cash unless its Board of Directors shall have determined to
adjust fractional interests by issuance of scrip certificates or in some
other manner. Adjustment in cash shall be made on the basis of the
current market value of one share of Common Stock, which shall be taken
to be the last reported sale price of the Corporation's Common Stock on
the principal stock exchange on which the Common Stock is then listed
(or if not so listed, on the over-the-counter market) for the last
business day before the conversion date or, if there was no reported
sale on that day, the last reported sales price on the first preceding
day for which such price is available.
(e) The issuance of Common Stock on conversion of Series D Preferred Stock
shall be without charge to the converting holder of Series D Preferred
Stock for any tax in respect of the issuance thereof, but the
Corporation shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of shares
in any name other than that of the holder of record on the books of the
Corporation of the shares of Series D Preferred Stock converted, and the
Corporation shall not be required to issue or deliver any certificate
for shares of Common Stock unless and until the person requesting the
issuance thereof shall have paid to the Corporation the amount of such
tax or shall have established to the satisfaction of the Corporation
that such tax has been paid.
(f) The conversion price provided the section 7(a) shall be subject to the
following adjustments, which shall be made to the cent:
(1) If the Corporation shall pay to the holders of its Common Stock a
dividend in shares of Common Stock, the conversion price in effect
immediately prior to the record date fixed for the determination of the
holders of Common Stock entitled to such dividend shall be proportionately
decreased, effective at the opening of business on the next following full
business day.
(2) If the Corporation shall split the outstanding shares of its Common
stock into a greater number of shares or combine the outstanding shares into
a smaller number, the conversion price in effect immediately prior to such
action shall be proportionately decreased in the case of a split or
increased in the case of a combination, effective at the opening of business
on the full business day next following the day such action becomes
effective.
(3) If the Corporation shall issue to the holders of its Common Stock
rights or warrants to subscribe for or purchase shares of its Common Stock
at a price of less than 90% of the Current Market Price (as defined below in
this paragraph) of the Corporation's Common Stock at the record date fixed
for the
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determination of the holders of Common Stock entitled to such rights or
warrants, the conversion price in effect immediately prior to said record
date shall be adjusted, effective at the opening of business on the next
following full business day, to an amount determined by multiplying such
conversion price by a fraction the numerator of which is the number of
shares of Common Stock of the Corporation outstanding immediately prior to
said record date plus the number of shares of Common Stock of the
Corporation which the aggregate subscription or purchase price of the total
number of shares so offered would purchase at the Current Market Price of
the Corporation's Common Stock at said record date and the denominator of
which is said number of shares outstanding immediately prior to said record
date plus the number of additional shares of its Common Stock offered for
subscription or purchase. The term "Current Market Price" at said record
date shall mean the average of the daily last reported sale prices per share
of the Corporation's Common Stock on the principal stock exchange on which
the Common Stock is then listed (or if not so listed, then on the
over-the-counter market) during 20 consecutive full business days commencing
with the 30th full business day before said record date, provided that if
there was no reported sale on any such day or days there shall be
substituted the average of the closing bid and asked quotations on that day
obtained from the market specialist assigned to the Corporation (or a market
maker in the case of the over-the-counter market).
(4) The Corporation may make such reductions in the conversion price,
in addition to those required by the foregoing provisions, as it considers
to be advisable in order that any event treated for federal income tax
purposes as a dividend of stock or stock rights shall not be taxable to the
recipients.
(g) No adjustment of the conversion price provided in section 7(a) shall be
made by reason of the issuance of Common Stock for cash except as
provided in section 7(f)(3), or by reason of the issuance of Common
Stock for property or services. Whenever the conversion price is
adjusted pursuant to section 7(f) the Corporation shall (1) promptly
place on file at its principal office and at the office of each of its
transfer agents for the Series D Preferred Stock a statement signed by
the Chairman of the Board, the President or a Vice President of the
Corporation and by its Treasurer or an Assistant Treasurer showing in
detail the facts requiring such adjustment and the conversion price
after such adjustment, and shall make such statement available for
inspection by shareholders of the Corporation, and (2) cause a notice to
be published at least once in a newspaper printed in the English
language and of general circulation in the City of Scranton,
Pennsylvania, and in the Borough of Manhattan, the City of New York, New
York, stating that such adjustment has been made and the adjusted
conversion price.
(h) If the Corporation shall issue to the holders of its Common Stock rights
or warrants to subscribe for or purchase shares of its Common Stock or
any other security, or if the Corporation shall distribute to the
holders of its Common Stock any evidences of indebtedness of any other
assets (excluding dividends and distributions in cash), the Corporation
shall mail to each holder of record of a share or shares of Series D
Preferred Stock, at his address as it shall appear on the books of the
Corporation, a notice stating the record date fixed or to be fixed for
the determination of the holders of Common Stock of record entitled to
such issuance or distribution. Such notice shall be mailed at least 10
days before such record date. Failure to mail such notice or any defect
therein or failure of any addressee to receive it shall not affect the
validity of such issuance or distribution of any vote thereon.
(i) In case of any reclassification or change of the outstanding shares of
Common Stock of the Corporation (except a split or combination of
shares) or in case of any consolidation or merger to which the
Corporation is a party (except a merger in which the Corporation is the
surviving corporation and which does not result in any reclassification
of or change in the outstanding Common Stock of the Corporation except
an increase in the number of outstanding shares or a split or
combination of shares) or in case of any sale or conveyance to another
corporation of all or substantially all of the property of the
Corporation, effective provision shall be made by the Corporation or by
the successor or purchasing corporation (1) that the holder of each
share of Series D Preferred Stock then outstanding shall thereafter have
the right to convert such share into the kind and amount of stock and
other securities and property receivable upon such reclassification,
change, consolidation, merger, sale or conveyance by a holder of the
number of shares of Common Stock of the Corporation into which such
share of Series D Preferred
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Stock might have been converted immediately prior thereto, and (2) that
there shall be subsequent adjustments of the conversion price which
shall be equivalent, as nearly as practicable, to the adjustments
provided for in section 7(f). The provisions of this section 7(i) shall
similarly apply to successive reclassifications, changes,
consolidations, mergers, sales or conveyances.
(j) Shares of Common Stock issued on conversion of shares of Series D
Preferred Stock shall be issued as fully paid shares and shall be
nonassessable by the Corporation. The Corporation shall at all times
reserve and keep available for the purpose of effecting the conversion
of Series D Preferred Stock, such number of its duly authorized shares
of Common Stock as shall be sufficient to effect the conversion of all
outstanding shares of Series D Preferred Stock.
(k) Shares of Series D Preferred Stock converted as provided herein shall
not be reissued.
[References to a former series of Preferred Stock, designated as $2.60
Cumulative Non-Voting Preferred Stock, Series E have been deleted, since all
such shares have been redeemed and restored to the status of authorized but
unissued Preferred Stock.]
RESOLVED, that another series of Preferred Stock, par value $1.00 per share, of
PNC Bank Corp. (the "Corporation") is hereby established and that the shares of
said series shall have, in addition to the preferences, qualifications,
privileges, limitations, restrictions and special or relative rights in respect
of Preferred Stock granted or created by law and by the Corporation's Articles
of Incorporation, the following preferences, qualifications, privileges,
limitations, restrictions and special or relative rights which are hereby fixed
and determined:
1. Designation. A series of Preferred Stock designated "Fixed/Adjustable Rate
Noncumulative Preferred Stock, Series F" (herein called "Series F Preferred
Stock") is hereby established, consisting of 6,000,000 shares subject to
increase or decrease in the number of shares in accordance with law.
2. Rank. Series F Preferred Stock shall rank, as to dividends and assets,
equally with the Series A Preferred Stock, the Series B Preferred Stock, the
Series C Preferred Stock, the Series D Preferred Stock and every other share of
capital stock from time to time outstanding which is not Common Stock of the
Corporation and which is not specifically made senior to or subordinate to the
Series F Preferred Stock as to dividends or assets.
3. Dividends. (a) Through September 29, 2001, the dividend rate per share of
Series F Preferred Stock shall be 6.05% or $3.025 per annum, payable quarterly
on March 31, June 30, September 30 and December 31 of each year (each a
"Dividend Payment Date"), commencing December 31, 1996. The initial dividend for
the dividend period commencing on October 9, 1996 to (but not including)
December 31, 1996, shall be $.6806 per share and shall be payable on December
31, 1996. On and after September 30, 2001, dividends on the Series F Preferred
Stock shall be payable quarterly on each Dividend Payment Date at the Applicable
Rate (as defined in subsection (c) of this Section 3) per share from time to
time in effect. If a Dividend Payment Date is not a business day, dividends (if
declared) on the Series F Preferred Stock shall be paid on the immediately
preceding business day. A dividend period with respect to a Dividend Payment
Date is the period commencing on the immediately preceding Dividend Payment Date
and ending on the day immediately prior to the next succeeding Dividend Payment
Date. Each such dividend shall be payable to holders of record as they appear on
the stock books of the Corporation on such record dates, not more than 30 nor
less than 15 days preceding the payment dates thereof, as will be fixed by the
Corporation's Board of Directors or a duly authorized committee thereof.
(b) Dividends on the Series F Preferred Stock shall not be cumulative and no
rights shall accrue to the holders of the Series F Preferred Stock by reason of
the fact that the Corporation may fail to declare or pay dividends on the Series
F Preferred Stock in any amount in any year, whether or not the earnings of the
Corporation in any year were sufficient to pay such dividends in whole or in
part. (c) Except as provided below in this subsection (c) of this Section 3, the
"Applicable Rate" per annum for any dividend period beginning on or after
September 30, 2001 shall be equal to .35% plus
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the Effective Rate (as hereinafter defined), but not less than 6.55% nor greater
than 12.55% (without taking into account any adjustments as described in
subsection (d) of this Section 3). The "Effective Rate" for any dividend period
beginning on or after September 30, 2001 shall be equal to the highest of the
Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year
Constant Maturity Rate (each as hereinafter defined) for such dividend period.
In the event that the Corporation determines in good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year Constant Maturity Rate or
the Thirty Year Constant Maturity Rate cannot be determined for any dividend
period, then the Effective Rate for such dividend period shall be equal to the
higher of whichever two of such rates can be so determined; (ii) only one of the
Treasury Bill Rate, the Ten Year Constant Maturity Rate or the Thirty Year
Constant Maturity Rate can be determined for any dividend period, then the
Effective Rate for such dividend period shall be equal to whichever such rate
can be so determined; or (iii) none of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity Rate can be
determined for any dividend period, then the Effective Rate for the preceding
dividend period shall be continued for such dividend period.
Except as described in this subsection (c) of this Section 3, the "Treasury Bill
Rate" for each dividend period shall be the arithmetic average of the two most
recent weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate is published during the relevant
Calendar Period (as hereinafter defined)) for three-month U.S. Treasury bills,
as published weekly by the Federal Reserve Board (as hereinafter defined) during
the Calendar Period immediately preceding the last 10 calendar days preceding
the dividend period for which the dividend rate on the Series F Preferred Stock
is being determined. In the event that the Federal Reserve Board does not
publish such a weekly per annum market discount rate during any such Calendar
Period, then the Treasury Bill Rate for such dividend period shall be the
arithmetic average of the two most recent weekly per annum market discount rates
(or the one weekly per annum market discount rate, if only one such rate is
published during the relevant Calendar Period) for three-month U.S. Treasury
bills, as published weekly during such Calendar Period by any Federal Reserve
Bank or by any U.S. Government department or agency selected by the Corporation.
In the event that a per annum market discount rate for three-month U.S. Treasury
bills is not published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U.S. Government department or agency during such Calendar Period,
then the Treasury Bill Rate for such dividend period shall be the arithmetic
average of the two most recent weekly per annum market discount rates (or the
one weekly per annum market discount rate, if only one such rate is published
during the relevant Calendar Period) for all of the U.S. Treasury bills then
having remaining maturities of not less than 80 nor more than 100 days, as
published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board does not publish such rates, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason no
such U.S. Treasury bill rates are published as provided above during such
Calendar Period, then the Treasury Bill Rate for such dividend period shall be
the arithmetic average of the per annum market discount rates based upon the
closing bids during such Calendar Period for each of the issues of marketable
non-interest-bearing U.S. Treasury securities with a remaining maturity of not
less than 80 nor more than 100 days from the date of each such quotation, as
chosen and quoted daily for each business day in New York City (or less
frequently if daily quotations are not generally available) to the Corporation
by at least three recognized dealers in U.S. Government securities selected by
the Corporation. In the event that the Corporation determines in good faith that
for any reason the Corporation cannot determine the Treasury Bill Rate for any
dividend period as provided in this paragraph, the Treasury Bill Rate for such
dividend period shall be the arithmetic average of the per annum market discount
rates based upon the closing bids during such Calendar Period for each of the
issues of marketable interest-bearing U.S. Treasury securities with a remaining
maturity of not less than 80 or more than 100 days, as chosen and quoted daily
for each business day in New York City (or less frequently if daily quotations
are not generally available) to the Corporation by at least three recognized
dealers in U.S. Government securities selected by the Corporation.
Except as described in this subsection (c) of this Section 3, the "Ten Year
Constant Maturity Rate" for each dividend period shall be the arithmetic average
of the two most recent weekly per annum Ten Year Average Yields (as hereinafter
defined) (or the one weekly per annum Ten Year Average Yield, if only one such
yield is published during the relevant Calendar Period), as published weekly by
the Federal Reserve Board during the Calendar Period immediately preceding the
last 10 calendar days preceding the dividend period for which the dividend rate
on the Series F Preferred Stock is being determined. In the event that the
Federal Reserve Board does not publish such a weekly per annum Ten Year Average
Yield during such Calendar Period, then the Ten Year Constant Maturity Rate for
such dividend period shall be the arithmetic average of the two most recent
weekly per annum Ten Year Average Yields (or the one weekly per annum Ten Year
Average Yield, if only one such yield is published during the relevant Calendar
Period), as published weekly during such Calendar Period by any Federal Reserve
Bank or by any U.S. Government department or agency selected by the Corporation.
In the event that a per annum Ten Year Average Yield is not published by the
Federal Reserve Board or by any Federal
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Reserve Bank or by any U.S. Government department or agency during such Calendar
Period, then the Ten Year Constant Maturity Rate for such dividend period shall
be the arithmetic average of the two most recent weekly per annum average yields
to maturity (or the one weekly per annum average yield to maturity, if only one
such yield is published during the relevant Calendar Period) for all of the
actively traded marketable U.S. Treasury fixed interest rate securities (other
than Special Securities (as hereinafter defined)) then having remaining
maturities of not less than eight nor more than 12 years, as published during
such Calendar Period by the Federal Reserve Board or, if the Federal Reserve
Board does not publish such yields, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the event that
the Corporation determines in good faith that for any reason the Corporation
cannot determine the Ten Year Constant Maturity Rate for any dividend period as
provided above in this paragraph, then the Ten Year Constant Maturity Rate for
such dividend period shall be the arithmetic average of the per annum average
yields to maturity based upon the closing bids during such Calendar Period for
each of the issues of actively traded marketable U.S. Treasury fixed interest
rate securities (other than Special Securities) with a final maturity date not
less than eight nor more than 12 years from the date of each such quotation, as
chosen and quoted daily for each business day in New York City (or less
frequently if daily quotations are not generally available) to the Corporation
by at least three recognized dealers in U.S. Government securities selected by
the Corporation.
Except as described in this subsection (c) of this Section 3, the "Thirty Year
Constant Maturity Rate" for each dividend period shall be the arithmetic average
of the two most recent weekly per annum Thirty Year Average Yields (as
hereinafter defined) (or the one weekly per annum Thirty Year Average Yield, if
only one such yield is published during the relevant Calendar Period), as
published weekly by the Federal Reserve Board during the Calendar Period
immediately preceding the last 10 calendar days preceding the dividend period
for which the dividend rate on the Series F Preferred Stock is being determined.
In the event that the Federal Reserve Board does not publish such a weekly per
annum Thirty Year Average Yield during such Calendar Period, then the Thirty
Year Constant Maturity Rate for such dividend period shall be the arithmetic
average of the two most recent weekly per annum Thirty Year Average Yields (or
the one weekly per annum Thirty Year Average Yield, if only one such yield is
published during the relevant Calendar Period), as published weekly during such
Calendar Period by any Federal Reserve Bank or by any U.S. Government department
or agency selected by the Corporation. In the event that a per annum Thirty Year
Average Yield is not published by the Federal Reserve Board or by any Federal
Reserve Bank or by any U.S. Government department or agency during such Calendar
Period, then the Thirty Year Constant Maturity Rate for such dividend period
shall be the arithmetic average of the two most recent weekly per annum average
yields to maturity (or the one weekly per annum average yield to maturity, if
only one such yield is published during the relevant Calendar Period) for all of
the actively traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) then having remaining maturities of not less
than 28 nor more than 30 years, as published during such Calendar Period by the
Federal Reserve Board or, if the Federal Reserve Board does not publish such
yields, by any Federal Reserve Bank or by any U.S. Government department or
agency selected by the Corporation. In the event that the Corporation determines
in good faith that for any reason the Corporation cannot determine the Thirty
Year Constant Maturity Rate for any dividend period as provided above in this
paragraph, then the Thirty Year Constant Maturity Rate for such dividend period
shall be the arithmetic average of the per annum average yields to maturity
based upon the closing bids during such Calendar Period for each of the issues
of actively traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) with a final maturity date not less than 28 nor
more than 30 years from the date of each such quotation, as chosen and quoted
daily for each business day in New York City (or less frequently if daily
quotations are not generally available) to the Corporation by at least three
recognized dealers in U.S. Government securities selected by the Corporation.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year
Constant Maturity Rate shall each be rounded to the nearest five hundredths of a
percent, with .025% being rounded upward.
The Applicable Rate with respect to each dividend period beginning on or after
September 30, 2001 shall be calculated as promptly as practicable by the
Corporation according to the appropriate method described in this subsection (c)
of this Section 3. The Corporation shall cause notice of each Applicable Rate to
be enclosed with the dividend payment checks next mailed to the holders of
Series F Preferred Stock.
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For the purposes of this subsection (c) of this Section 3, the following terms
shall have the following meanings : (i) "Calendar Period" means a period of 14
calendar days; (ii) "Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any successor agency; (iii) "Special Securities" means
securities which can, at the option of the holder, be surrendered at face value
in payment of any Federal estate tax or which provide tax benefits to the holder
and are priced to reflect such tax benefits or which were originally issued at a
deep or substantial discount; (iv) the term "Ten Year Average Yield" means the
average yield to maturity for actively traded marketable U.S. Treasury fixed
interest rate securities (adjusted to constant maturities of 10 years); and (v)
"Thirty Year Average Yield" means the average yield to maturity for actively
traded marketable U.S. Treasury fixed interest rate securities (adjusted to
constant maturities of 30 years).
(d) If one or more amendments to the Internal Revenue Code of 1986, as amended
(the "Code"), are enacted that change the percentage of the dividends received
deduction (70% as of October 4, 1996) as specified in Section 243(a)(1) of the
Code or any successor provision (the "Dividends Received Percentage"), as
applicable to the Series F Preferred Stock, the amount of each dividend payable
per share of the Series F Preferred Stock for dividend payments made on or after
the later of the date of enactment or the effective date of such change shall be
adjusted by multiplying the amount of the dividend payable determined as
described under subsection (a) of this Section 3 (before adjustment) by a
factor, which shall be the number determined in accordance with the following
formula (the "DRD Formula"), and rounding the result to the nearest cent:
1 - [.35 (1 - .70)]
- ----------------------
1 - [.35 (1 - DRP)]
For purposes of the DRD Formula, "DRP" means the Dividends Received Percentage
applicable to the dividend in question. No amendment to the Code, other than a
change in the percentage of the dividends received deduction set forth in
Section 243(a)(1) of the Code or any successor provision, as applicable to the
Series F Preferred Stock, shall give rise to an adjustment. Notwithstanding the
foregoing provisions of this subsection (d) of this Section 3, in the event
that, with respect to any such amendment, the Corporation shall receive an
unqualified opinion of nationally recognized independent tax counsel selected by
the Corporation and approved by Cravath, Swaine & Moore (which approval shall
not be unreasonably withheld) or a private letter ruling or similar form of
authorization from the Internal Revenue Service to the effect that such an
amendment would not apply to dividends payable on the Series F Preferred Stock,
then any such amendment shall not result in the adjustment provided for pursuant
to the DRD Formula. The opinion referenced in the previous sentence shall be
based upon a specific provision in the legislation or upon a published
pronouncement of the Internal Revenue Service addressing such legislation. The
Corporation's calculation of the dividends payable as so adjusted and as
certified accurate as to calculation and reasonable as to method by the
independent certified public accountants then regularly engaged by the
Corporation, shall be final and not subject to review.
If any amendment to the Code which reduces the Dividends Received Percentage, as
applicable to the Series F Preferred Stock, is enacted and becomes effective
after a dividend payable on a Dividend Payment Date has been declared, the
amount of dividend payable on such Dividend Payment Date shall not be increased;
but instead, an amount, equal to the excess of (x) the product of the dividends
paid by the Corporation on such Dividend Payment Date and the DRD Formula (where
the DRP used in the DRD Formula would be equal to the reduced Dividends Received
Percentage) and (y) the dividends paid by the Corporation on such Dividend
Payment Date, shall be payable to holders of record on the next succeeding
Dividend Payment Date in addition to any other amounts payable on such date.
If prior to April 1, 1997, an amendment to the Code is enacted that reduces the
Dividends Received Percentage, as applicable to the Series F Preferred Stock,
and such reduction retroactively applies to a Dividend Payment Date as to which
the Corporation previously paid dividends on the Series F Preferred Stock (each
an "Affected Dividend Payment Date"), the Corporation shall pay (if declared)
additional dividends (the "Additional Dividends") on the next succeeding
Dividend Payment Date (or if such amendment is enacted after the dividend
payable on such Dividend Payment Date has been declared, on the second
succeeding Dividend Payment Date following the date of enactment) to holders of
record on such succeeding Dividend Payment Date in an amount equal to the excess
of (x) the product of the dividends paid by the Corporation on each Affected
Dividend Payment Date and the DRD Formula (where the DRP used in the DRD Formula
would be equal to the Dividends Received Percentage applicable to each Affected
Dividend Payment Date) over (y) the dividends paid by the Corporation on each
Affected Dividend Payment Date.
Additional Dividends shall not be paid in respect of the enactment of any
amendment to the Code on or after April 1, 1997 which retroactively reduces the
Dividends Received Percentage, or if prior to April 1, 1997, such amendment
would not result in an adjustment due to the Corporation having received either
an opinion of counsel or tax ruling referred to in the third preceding
paragraph. The Corporation shall only make one payment of Additional Dividends.
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In the event that the amount of dividend payable per share of the Series F
Preferred Stock shall be adjusted pursuant to the DRD Formula and/or Additional
Dividends are to be paid, the Corporation will cause notice of each such
adjustment and, if applicable, any Additional Dividends, to be sent to the
holders of the Series F Preferred Stock.
In the event that the Dividends Received Percentage, applicable to the Series F
Preferred Stock, is reduced to 40% or less, the Corporation may at its option,
redeem the Series F Preferred Stock as a whole, but not in part, as described in
Section 5 below.
4. Liquidation. The amount payable upon shares of Series F Preferred Stock in
the event of voluntary or involuntary liquidation of the Corporation, prior to
any payment to the holders of Common Stock or of any class or series of stock of
the Corporation ranking as to assets subordinated to the Series F Preferred
Stock, shall be $50.00 per share plus an amount equal to accrued and unpaid
dividends, whether or not earned or declared, computed thereon from the
immediately preceding Dividend Payment Date (but without cumulation for unpaid
dividends for prior dividend periods on the Series F Preferred Stock) to the
date on which payment thereof is made available.
5. Redemption. (a) Prior to September 30, 2001, shares of Series F Preferred
Stock shall not be redeemable, except under the circumstances described in
subsection (b) of this Section 5. Shares of Series F Preferred Stock shall be
redeemable by the Corporation, in whole or in part, at any time and from time to
time on and after September 30, 2001 at $50.00 per share plus an amount equal to
accrued and unpaid dividends, whether or not earned or declared, computed
thereon from the immediately preceding Dividend Payment Date (but without
cumulation for unpaid dividends for prior dividend periods on the Series F
Preferred Stock) to the date fixed for redemption, including any changes in
dividends payable due to changes in the Dividends Received Percentage and
Additional Dividends, if any (each as defined in subsection (d) of Section 3).
(b) Notwithstanding anything to the contrary in subsection (a) of this Section
5, if the Dividends Received Percentage is equal to or less than 40% and, as a
result, the amount of dividends on the Series F Preferred Stock on any Dividend
Payment Date will be or is adjusted upwards as described in subsection (d) of
Section 3 above, the Corporation, at its option, may redeem all, but not less
than all, of the outstanding shares of Series F Preferred Stock; provided,
however, that within 60 days of the date on which an amendment to the Code is
enacted which reduces the Dividends Received Percentage to 40 percent or less,
the Corporation sends notice to the holders of the Series F Preferred Stock of
such redemption. Any redemption of Series F Preferred Stock in accordance with
this Section 5(b) shall take place on the date specified in the notice, which
shall not be less than 30 days nor more than 60 days from the date such notice
is sent to holders of Series F Preferred Stock. Any redemption of Series F
Preferred Stock in accordance with this Section 5(b) shall be on notice as
aforesaid at the applicable redemption price set forth in the following table,
in each case plus accrued and unpaid dividends computed thereon from the
immediately preceding Dividend Payment Date (but without any cumulation for
unpaid dividends for prior dividend periods on Series F Preferred Stock) to the
date fixed for redemption, including any changes in dividends payable due to
changes in the Dividends Received Percentage and Additional Dividends, if any,
whether or not earned or declared.
REDEMPTION PERIOD REDEMPTION PRICE PER SHARE
- ----------------- --------------------------
October 9, 1996 through September 29, 1997 $52.50
September 30, 1997 through September 29, 1998 52.00
September 30, 1998 through September 29, 1999 51.50
September 30, 1999 through September 29, 2000 51.00
September 30, 2000 through September 29, 2001 50.50
On or after September 30, 2001 50.00
(c) Holders of Series F Preferred Stock shall have no right to require the
redemption of shares of Series F Preferred Stock.
6. Voting rights. Holders of shares of Series F Preferred Stock shall have no
voting rights except as set forth in Section 4 and Section 5 of ARTICLE SEVENTH
of the Corporation's Articles of Incorporation or as otherwise required from
time to time by law.
7. Conversion Rights. Shares of Series F Preferred Stock shall not be
convertible into shares of Common Stock or any other security of the
Corporation.
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