1
EXHIBIT 4(A)
[ENGLISH TRANSLATION FROM SPANISH]
CERTIFICATE OF INCORPORATION OF
BANPONCE CORPORATION
FIRST: The name of the Corporation is BanPonce Corporation.
SECOND: The principal office of the Corporation shall be at the Popular
Center Building, 209 Munoz Rivera Avenue, Hato Rey, Puerto Rico 00918 and its
resident agent at such address is Ernesto N. Mayoral Megwinoff.
THIRD: The nature of the business and the purposes of the Corporation are
to engage in, carry out and conduct, for profit, to the extent permitted by law,
the following activities:
1. To purchase, subscribe for, or otherwise acquire and own, hold,
use, sell, assign, transfer, mortgage, pledge, exchange, or otherwise
dispose of, and deal in and with the personal or mixed property of every
kind and description, including shares of stock, bonds, debentures, notes,
evidences of indebtedness and other securities, or other interests in
debentures, notes, mortgages, or other contracts or obligations and any
certificates, receipts or other instruments representing options, rights or
warrants to receive, purchase or subscribe for the same or representing any
other rights or interests therein or in any property or assets of or
created or issued by any person, or persons, corporation or corporations,
association or associations, domestic or foreign, including agencies,
instrumentalities, authorities, administrations, corporations or other
public governmental bodies or subdivisions thereof, and to pay therefor, in
whole or in part, in cash or by exchanging therefor, stock, bonds, or other
evidences of indebtedness or securities of this or any other corporation,
and while the owner or holder of any such personal or mixed property,
stocks, bonds, debentures, notes, evidences of indebtedness or other
securities, contracts or obligations, to receive, collect and dispose of
the interest, dividends, and income arising from such property and to
possess and exercise in respect thereof all the rights, powers and
privileges of ownership, including all voting powers and privileges of
ownership, including all voting powers on any stocks so owned to the same
extent as a natural person might or could do.
2. To purchase or otherwise acquire and own, hold, use, sell, assign,
transfer, exchange and convey, pledge, lease, rent, remodel, improve,
reconstruct, mortgage and otherwise encumber or dispose of real estate
whether improved or unimproved, and any right, privilege or interest of any
kind whatsoever therein, and to manage, operate, own, hold, deal in and
dispose of all or any part of such property and assets whether real,
personal or mixed, as may be necessary or desirable for the successful
conduct and operation of such business and to possess and exercise in
respect thereof all the rights, powers and privileges of ownership, to the
same extent as a natural person might or could do; provided, however, that
the Corporation shall not be authorized, as respects real property located
within the Commonwealth of Puerto Rico, to conduct the business of buying
and selling real estate, and shall in all other respects be subject to the
provisions of Section 14 of Article VI of the Constitution of the
Commonwealth of Puerto Rico.
3. To aid either by loans or by guaranty of securities or in any other
manner, any corporation, domestic or foreign, any shares of stock, or any
bonds, debentures, evidences of indebtedness or other securities whereof
are held by this Corporation or in which it shall have any interest, and to
do any acts designed to protect, preserve, improve, or enhance the value of
any property at any time held or controlled by this Corporation or in which
it at the same time may be interested.
4. To endorse or guarantee the payment of principal, interest, or
dividends on securities and to guarantee the performance of sinking funds
or other obligations of, and to guarantee in any way permitted by law the
performance of any contracts or obligations of every kind and description
with or of any person, firm, association, corporation or of the government
or subdivisions thereof.
5. To lend its surplus or uninvested funds from time to time to such
extent, to such persons, firms, associations, corporations or governmental
bodies or subdivisions, agencies or instrumentalities thereof,
1
2
and on such terms and on such security, if any, as the Board of
Directors of the Corporation may determine.
6. To borrow money for any of the purposes of the Corporation, from
time to time, and without limit as to amount; from time to time, to issue
and sell its own securities in such amounts, on such terms and conditions,
for such purposes and for such consideration, as may now be or hereafter
shall be permitted by the laws of the Commonwealth of Puerto Rico; and to
secure the same by mortgage upon, or the pledge of, or the conveyance or
assignment in trust of, the whole or any part of the properties, assets,
business and good will of the Corporation then owned or thereafter
acquired.
7. To merge into or consolidate with, and to enter into agreements and
cooperative relations, not in contravention of law, with any person, firm,
association or corporation; to purchase or otherwise acquire and to hold,
cancel, reissue, sell, exchange, transfer or otherwise deal in its own
shares of capital stock or other securities from time to time to the extent
and upon such terms as shall be permitted by the laws of the Commonwealth
of Puerto Rico; provided, however, that shares of its own capital stock so
purchased or held shall not be directly or indirectly voted, nor shall they
be entitled to the payment of dividends during such period or periods as
they shall be held by the Corporation.
8. To manufacture, process, purchase, sell and generally to trade and
deal in and with goods, wares and merchandise of every kind, nature and
description, and to engage and participate in any mercantile, industrial or
trading business of any kind or character whatsoever.
9. To apply for, register, obtain, purchase, lease, take licenses in
respect of or otherwise acquire, and to hold, own, use, operate, develop,
enjoy, turn to account, grant licenses and immunities in respect of,
manufacture under and to introduce, sell, assign, mortgage, pledge, or
otherwise dispose of, and, in any manner deal with and contract with
reference to:
(a) inventions, devices, formulas, processes and any improvements
and modifications thereof;
(b) letters patent, patent rights, patented processes, copyrights,
designs, and similar rights, trademarks, trade symbols and other
indications of origin and ownership granted by or recognized under the
laws of the Commonwealth of Puerto Rico, the Government of the United
States of America or of any state or subdivision thereof, or of any
foreign country or subdivision thereof, and all rights connected
therewith or appertaining thereunto;
(c) franchises, licenses, grants and concessions.
10. To acquire by purchase, exchange or otherwise, all or any part of,
or any interest in, the properties, assets, business and good will of any
one or more persons, firms, associations, or corporations heretofore or
hereafter engaged in any business for which a corporation may now or
hereafter be organized under the laws of the Commonwealth of Puerto Rico;
to pay for the same in cash, property or its own or other securities; to
hold, operate, reorganize, liquidate, sell or in any manner dispose of the
whole or any part thereof; and in connection therewith, to assume or
guarantee performance of any liabilities, obligations or contracts of such
persons, firms, associations or corporations, and to conduct the whole or
any part of any business thus acquired.
11. To draw, make, accept, endorse, discount, execute, and issue
promissory notes, drafts, bills of exchange, warrants, bonds, debentures,
and other negotiable or transferable instruments and evidences of
indebtedness whether secured by mortgage or otherwise, as well as to secure
the same by mortgage or otherwise, so far as may be permitted by the laws
of the Commonwealth of Puerto Rico.
12. To the extent permitted by law, and subject to obtaining the
license required under the provisions of Section 9.060 of the Insurance
Code of Puerto Rico (26 LPRA 906), to act as agent for insurance companies
in soliciting and receiving applications for property, marine and
transportation, vehicle, casualty surety and title insurance, and all other
kinds of insurance except life and disability insurance, the collection of
premiums, and doing such other business as may be delegated to agents by
such companies, and to conduct a general insurance agency business.
2
3
13. To organize or cause to be organized under the laws of the
Commonwealth of Puerto Rico, or of any other State of the United States of
America, or of the District of Columbia, or of any territory, dependency,
colony or possession of the United States of America, or of any foreign
country, a corporation or corporations for the purpose of transacting,
promoting or carrying on any or all of the objects or purposes for which
the corporation is organized, and to dissolve, wind up, liquidate, merge or
consolidate any such corporation or corporations or to cause the same to be
dissolved, wound up, liquidated, merged or consolidated.
14. To conduct its business in any and all of its branches and
maintain offices both within and without the Commonwealth of Puerto Rico,
in any and all States of the United States of America, in the District of
Columbia, in any or all territories, dependencies, colonies or possessions
of the United States of America, and in foreign countries.
15. To such extent as a corporation organized under the laws of the
Commonwealth of Puerto Rico may now or hereafter lawfully do, to do, either
as principal or agent and either alone or through subsidiaries or in
connection with other persons, firms, associations or corporations, all and
everything necessary, suitable, convenient or proper for, or in connection
with or incident to, the accomplishment of any of the purposes or the
attainment of any one or more of the objects herein enumerated, or designed
directly or indirectly to promote the interests of the Corporation or to
enhance the value of its properties; and in general to do any and all
things and exercise any and all powers, rights, and privileges which a
corporation may now or hereafter be organized to do or to exercise under
the laws of the Commonwealth of Puerto Rico.
The foregoing provisions of this Article THIRD shall be construed both as
purposes and powers and each as an independent purpose and power. The foregoing
enumeration of specific purposes and powers shall not be held to limit or
restrict in any manner the purposes and powers of the Corporation and the
purposes and powers herein specified shall, except when otherwise provided in
this Article THIRD, be in no way limited or restricted by reference to, or
interference from, the terms of any provisions of this or any other Article of
this Certificate of Incorporation.
FOURTH: The Corporation is to have perpetual existence.
FIFTH: The minimum amount of capital with which the Corporation shall
commence business shall be $1,000.00.
The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue, upon resolutions approved by the
Board of Directors from time to time, is one hundred million shares
(100,000,000), of which ninety million shares (90,000,000) shall be shares of
Common Stock of the par value of $6.00 per share (hereinafter called "Common
Stock"), and ten million shall be shares of Preferred Stock without par value
(hereinafter called "Preferred Stock").
The amount of the authorized capital stock of any class or classes of stock
may be increased or decreased by the affirmative vote of the holders of a
majority of the stock of the Corporation entitled to vote.
The designations and the powers, preferences and rights, and the
qualifications, limitations or restrictions thereof, of the Preferred Stock
shall be as follows:
(1) The Board of Directors is expressly authorized at any time, and
from time to time, to provide for the issuance of shares of Preferred Stock
in one or more series, and with such voting powers, full or limited but not
to exceed one vote per share, or without voting powers, and with such
designations, preferences, and relative, participating, optional or other
special rights, and qualifications, limitations or restrictions thereof, as
shall be expressed in the resolution or resolutions providing for the issue
thereof adopted by the Board of Directors and as are not otherwise
expressed in this Certificate of Incorporation or any amendment thereto,
including (but without limiting the generality of the foregoing) the
following:
(a) the designation of such series;
(b) the purchase price which the Corporation shall receive for each
share of such series;
3
4
(c) the dividend rate of such series, the conditions and dates upon
which such dividends shall be payable, the preference or relation which
such dividends shall bear to the dividends payable on any other class or
classes or on any other series of any class or classes of capital stock
of the Corporation, and whether such dividends shall be cumulative or
non-cumulative;
(d) whether the shares of such series shall be subject to
redemption by the Corporation, and, if made subject to such redemption,
the times, prices and other terms and conditions of such redemption;
(e) the terms and amount of any sinking fund provided for the
purchase or redemption of the shares of such series;
(f) whether the shares of such series shall be convertible into or
exchangeable for shares of any other class or classes or of any other
series of any class or classes of capital stock of the Corporation, and,
if provision be made for conversion or exchange, the times, prices,
rates, adjustments, and other terms and conditions of such conversion or
exchange;
(g) the extent, if any, to which the holders of the shares of such
series shall be entitled to vote as a class or otherwise with respect to
the election of directors or otherwise;
(h) the restrictions and conditions, if any, upon the reissue of
any additional Preferred Stock ranking on a parity with or prior to such
shares as to dividends or upon dissolution;
(i) the rights of the holders of the shares of such series upon the
dissolution of, or upon the distribution of assets of, the Corporation,
which rights may be different in the case of a voluntary dissolution
than in the case of an involuntary dissolution.
(2) Except as otherwise required by law and except for such voting
powers with respect to the election of directors or other matters as may be
stated in the resolutions of the Board of Directors creating any series of
Preferred Stock, the holders of any such series shall have no voting power
whatsoever.
SIXTH: The Board of Directors shall have the power, whenever it may deem
necessary to so act, from time to time, to authorize the issue of new shares of
stock. The common stockholders of record on any date designated by resolution of
the Board of Directors shall have preference for the subscription for common
stock on a pro rata basis unless the Board of Directors unanimously resolves
otherwise, but the stockholders shall have no preference to subscribe therefor
in the event of new issues of shares of stock which may be authorized pursuant
to any Dividend Reinvestment and Stock Purchase Plan of the Corporation or which
may be authorized in order to exchange such new shares of stock for property
which the Board of Directors may consider convenient or necessary for the
Corporation to acquire, nor shall the stockholders have any right of preference
therefore in the event of new issues of stock in payment of services rendered to
the Corporation, or of shares of stock to be issued for sale to officers or
employees, on the basis of options, as an incentive either to commence or to
continue rendering services for the Corporation.
SEVENTH: The name and address of each incorporator is:
NAME ADDRESS
----------------------------------- -----------------------------------
1. Socorro Santiago................ 1395 San Alfonso Avenue
Urb. Altamesa
Rio Piedras, Puerto Rico
2. Annie Serrano................... DH-27 Llanuras Street
Rio Hondo IV
Baymon, Puerto Rico
3. Julie Vazquez................... 31st Street, AE-22
Villas de Loiza
Canovanas, Puerto Rico
4
5
EIGHTH: (1) The Board shall be composed of such number of directors as are
established from time to time by the Board of Directors and approved by an
absolute majority of directors; provided, however, that the total number of
directors shall always be an odd number and not less than nine (9) nor more than
twenty-five (25). The Board of Directors shall be divided into three classes as
nearly equal in number as possible, with each class having at least three
members and with the term of office of one class expiring each year. Each
director shall serve for a term ending on the date of the third annual meeting
of stockholders following the annual meeting at which such director was elected;
provided, however, that each initial director in Class 1 shall hold office until
the annual meeting of stockholders in 1991; each initial director in Class 2
shall hold office until the annual meeting of stockholders in 1992; and each
initial director in Class 3 shall hold office until the annual meeting of
stockholders in 1993. Except as provided in this Article Eighth, a director
shall be elected by the affirmative vote of a majority of the shares of the
class of stock represented at the annual meeting of stockholders for which the
director stands for election and entitled to elect such director.
(2) Any vacancies in the Board of Directors, by reason of an increase in
the number of directors or otherwise, shall be filled solely by the Board of
Directors, by majority vote of the directors then in office, though less than a
quorum, but any such director so elected shall hold office only until the next
succeeding annual meeting of stockholders. At such annual meeting, such director
shall be elected and qualified in the class in which such director is assigned
to hold office for the term or remainder of the term of such class. Directors
shall continue in office until others are chosen and qualified in their stead.
When the number of directors is changed, any newly created directorships or any
decrease in directorships shall be so assigned among the classes by a majority
of the directors then in office, though less than a quorum, so as to make all
classes as nearly equal in number as possible. To the extent of any inequality
within the limits of the foregoing, the class of directorships shall be the
class or classes then having the last date or the later dates for the expiration
of its or their terms. No decrease in the number of directors shall shorten the
term of any incumbent director.
(3) Any director may be removed from office as a director but only for
cause by the affirmative vote of the holders of two-thirds (2/3) of the
combined voting power of the then outstanding shares of stock of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class.
The Board of Directors may, by resolution passed by a majority of the whole
Board, designate one or more committees, each committee to consist of two or
more of the directors of the Corporation, which to the extent provided in the
resolution or in the by-laws of the Corporation, shall have and may exercise the
powers of the Board of Directors (other than the power to remove or elect
officers) in the management of the business and affairs of the Corporation, and
may authorize the seal of the Corporation to be affixed to all papers which may
require it. Such committee or committees shall have such name or names as may be
stated in the by-laws of the Corporation or as may be determined from time to
time by resolution adopted by the Board of Directors.
The Board of Directors may from time to time, in the manner provided for in
the by-laws of the Corporation, hold its regular or extraordinary meetings
outside of Puerto Rico.
NINTH: The Board of Directors may, upon resolution approved by an absolute
majority thereof, from time to time (after adoption of the original by-laws of
the Corporation) adopt, amend or repeal the by-laws of the Corporation;
provided, that any by-laws adopted, amended or repealed by the Board of
Directors may be amended or repealed, and any by-laws may be adopted, by the
stockholders of the Corporation.
TENTH: The affirmative vote of the holders of not less than seventy-five
percent (75%) of the total number of outstanding shares of the Corporation shall
be required (i) to amend this Article TENTH, (ii) to approve any Business
Combination for which stockholder approval is required by applicable law or
(iii) to approve the voluntary dissolution of the Corporation, notwithstanding
that applicable law would otherwise permit any of the above with the approval of
fewer shares or without the approval of any shares.
For purposes of this Article TENTH, the term "Business Combination" shall
mean:
(a) a merger, reorganization or consolidation in which the Corporation
is a constituent corporation; or
5
6
(b) the sale, lease, or hypothecation of substantially all the assets
of the Corporation.
Other than with respect to this Article TENTH, the affirmative vote of the
holders of not less than two-thirds of the total number of outstanding shares of
the Corporation shall be required to amend these Articles of Incorporation,
notwithstanding, that applicable law would otherwise permit such amendment with
the approval of fewer shares or without the approval of any shares.
ELEVENTH: (1) The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the Corporation, or is or was serving at the written request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the Corporation and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
(2) The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent of
the Corporation, or is or was serving at the written request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty to the
Corporation unless and only to the extent that the court in which such action or
suit was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which such court
shall deem proper.
(3) To the extent that a director, officer, employee or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in paragraph 1 or 2 of this Article
ELEVENTH, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(4) Any indemnification under paragraph 1 or 2 of this Article ELEVENTH
(unless ordered by a court) shall be made by the Corporation only as authorized
in the specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he had met the
applicable standard of conduct set forth therein. Such determination shall be
made (a) by the Board of Directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or proceeding, or (b) if
such a quorum is not obtainable, or, even if obtainable a quorum of
disinterested directors so directs, by independent legal counsel in a written
opinion, or (c) by the stockholders.
(5) Expense incurred in defending a civil or criminal action, suit or
proceeding may be paid by the Corporation in advance of the final disposition of
such action, suit or proceeding as authorized by the Board of Directors in the
specific case upon receipt of an undertaking by or on behalf of the director,
officer, employee or agent to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the Corporation as
authorized in this Article ELEVENTH.
6
7
(6) The indemnification provided by this Article ELEVENTH shall not be
deemed exclusive of any other rights to which those seeking indemnification may
be entitled under any statute, by-law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such a person.
(7) By action of its Board of Directors, notwithstanding any interest of
the directors in the action, the Corporation may purchase and maintain
insurance, in such amounts as the Board of Directors deems appropriate, on
behalf of any person who is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the written request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against any liability asserted against him
and incurred by him in any such capacity, or arising out of this status as such,
whether or not the Corporation would have the power or would be required to
indemnify him against such liability under the provisions of this Article
ELEVENTH or of the General Corporation Law of the Commonwealth of Puerto Rico or
of any other state of the United States or foreign country as may be applicable.
The foregoing represents, to the best of my knowledge, a fair and accurate
translation from Spanish of the Certificate of Incorporation of BanPonce
Corporation.
By: /s/ BRUNILDA SANTOS DE ALVAREZ
-------------------------------------
Name: Brunilda Santos de Alvarez
Title: Assistant Secretary
7