1
EXHIBIT 3
RESTATED ARTICLES OF INCORPORATION
OF
SPRINGS INDUSTRIES, INC.
The following Articles of Incorporation are the restated
Articles of Incorporation as of April 18, 1994, and supersede and take the
place of the existing Articles of Incorporation of Springs Industries, Inc. and
all amendments thereto.
1. NAME. The name of the corporation shall be Springs
Industries, Inc.
2. GENERAL NATURE OF BUSINESS. The general nature of the
business of the corporation is to manufacture and sell textile products and
other fabrics of all kinds made from cotton and other natural fibers and
synthetic materials. In addition, the corporation shall be authorized to
engage in business for the following objects and purposes:
(a) to manufacture, buy, sell, import, export, lease, or
otherwise acquire, hold, manage, convey, mortgage, or otherwise dispose of and
deal and trade in, either as principal, broker, or agent of others, cloths and
fabrics of all kinds and all articles made from cotton, wool, silk, or
synthetic materials, or any other kind of fabric or materials or substances and
their products and waste and by-products; to manufacture, purchase, or
otherwise acquire, construct, repair, operate and maintain, trade and deal in
any and all kinds of machinery, and any and all kinds of mechanical apparatus,
and any and all kinds of fixtures and supplies; and to engage in the business
of spinning, weaving, bleaching, dyeing, printing, finishing, processing,
manufacturing, buying, selling, and otherwise dealing in any and all kinds of
fabrics and textile goods;
(b) to undertake and carry on any lawful business
anywhere and generally to institute, enter into, carry on, assist, promote, and
participate in commercial, mercantile, engineering, construction, industrial or
financial enterprises, and other businesses, works, contracts, syndicates,
underwritings, and other financial operations, to deal in real estate, and to
act as brokers and financial agents of any individual, firm, corporation, or
association; and to aid in any manner any corporation, association, or
enterprise whose bonds or stock or other obligations are held by this
corporation or in which this corporation is any way interested; and to merge or
consolidate with any corporation in such manner as may be permitted by law; and
(c) to do all and everything necessary, suitable,
convenient, or proper for the accomplishment of any of the purposes or the
attainment of any one or more of the objects herein enumerated or incidental to
the powers herein named or which shall at any time appear for the benefit or
protection of the corporation, to the same extent and as fully as natural
persons might or could do, with all the powers now or hereinafter conferred by
the laws of the State of South Carolina upon corporations incorporated under
the laws thereof.
The foregoing clauses shall be construed both as objects and
powers; and it is hereby expressly provided that the foregoing enumeration of
specific powers shall not be held to limit or restrict in any manner the powers
of the corporation.
3. PERIOD OF DURATION. The period of duration of the corporation
shall be perpetual.
4. DIRECTORS. The number of directors may be increased or
decreased by an amendment to the by-laws duly adopted by the shareholders or by
action of the Board of Directors pursuant to authorization in the by-laws duly
adopted by the shareholders.
5. MINIMUM CAPITAL REQUIREMENTS. Before beginning business the
corporation received more than one thousand dollars in cash as consideration
for the issuance of its shares.
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6. CAPITALIZATION. The corporation shall be authorized to issue
40,000,000 shares of Common Stock, par value $.25 Per share (the "Common
Stock"). Effective April 30, 1987, each issued share of common stock, of the
par value of $.50 Per share, of the corporation, including any shares of common
stock held in treasury by the corporation, shall be converted into two shares
of Common Stock. The corporation shall also be authorized to issue 40,000,000
shares of Class A Common Stock, par value $.25 Per share (the "Class A Common
Stock"), and 20,000,000 shares of Class B Common Stock, par value $.25 Per
share (the "Class B Common Stock"), upon the declaration of the Effective Date
(as hereinafter defined) by the Board of Directors of the corporation as
provided in paragraph (c) of this Article 6. The corporation shall also be
authorized to issue 1,000,000 shares of voting preferred stock of the par value
of $1.00 Per share with an aggregate involuntary liquidation value of not in
excess of $50,000,000.
The relative rights, preferences, and limitations of the
shares of each class of stock are as follows:
(a) IN GENERAL. No holders of shares of stock of the
corporation of any class or series shall be entitled, as a matter of right, to
any pre-emptive rights to subscribe for, or purchase, any shares of stock of
any class or series, whether now or hereafter authorized, or any bonds,
debentures or other securities of the corporation.
In any election of directors of the corporation, including the
election of the additional two directors hereinafter provided to be elected by
the holders of the voting preferred stock voting as a class under certain
circumstances, each shareholder entitled to vote in such election shall be
entitled to cumulate his votes either
(i) by giving to one candidate as many votes as shall
equal the number of directors who are to be elected and for those
whose election he has a right to vote multiplied by the number of
shares owned by such holder, or
(ii) by distributing the total number of his votes,
computed as set out above, among any number of candidates.
(1)(b) COMMON STOCK. Unless and until the Effective Date is
declared by the Board of Directors as provided in paragraph (c) below, (1) all
shares of Common Stock are of one and the same class and when issued shall have
equal rights of participation in dividends and assets of the corporation and
shall be non-assessable and (2) the holders of Common Stock shall be entitled
to one vote for each of the shares of such stock held by them of record at any
meeting of shareholders, except that there shall be cumulative voting rights in
the election of directors.
(1)(c) DECLARATION OF EFFECTIVE DATE AND REDESIGNATION OF
COMMON STOCK AS CLASS A COMMON STOCK. At any time prior to April 1, 1990, the
Board of Directors of the corporation, in its discretion and after its
determination that the issuance of Class A Common Stock and Class B Common
Stock would be in compliance with applicable federal securities laws and the
rules and regulations of the Securities and Exchange Commission, and that an
active trading market would exist for the Class A Common Stock, may declare the
Effective Date (the "Effective Date"). As of the Effective Date, each issued
share of Common Stock, including any shares of Common Stock held in treasury by
the corporation, automatically shall be redesignated as, and become one share
of, Class A Common Stock.
(1)(d) EXCHANGE OF CLASS A COMMON STOCK FOR CLASS B COMMON
STOCK. During the ninety (90) calendar days following the declaration of the
Effective Date by the Board of Directors (the "Exchange Period"), each share of
Class A Common Stock may be exchanged for one share of
- - --------------------------------------------------------------------------------
(1) (Note: The Effective Date was declared June 28, 1988, and the Exchange
Period ended September 26, 1988.)
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Class B Common Stock. The Board of Directors may authorize by resolution the
manner in which shareholders may exchange shares of Class A Common Stock for
Class B Common Stock during the Exchange Period. In connection with a
declaration of the Effective Date, the corporation shall forward to each
shareholder instructions for exchanging Class A Common Stock for shares of
Class B Common Stock during the Exchange Period. Except for Class B Common
Stock issued in exchange for Class A Common Stock during the Exchange Period,
the Board of Directors may not issue shares of Class B Common Stock except in
the form of a distribution or distributions pursuant to a stock dividend on or
stock split of the shares of the Class B Common Stock and only to the then
holders of outstanding shares of the Class B Common Stock in conjunction with,
and at the same rate as, a stock dividend on or stock split of the shares of
Class A Common Stock in such a manner as to retain the relative voting and
dividend rights of each such class of common stock.
(e) VOTING RIGHTS AND POWERS OF CLASS A COMMON STOCK AND
CLASS B COMMON STOCK.
(i) With respect to all matters upon which shareholders
are entitled to vote or to which shareholders are entitled to give
consent:
(A) the holders of outstanding shares of Class A
Common Stock and Class B Common Stock shall, except as
hereinafter provided, vote together without regard to class;
(B) every holder of outstanding shares of Class A
Common Stock shall be entitled to cast thereon one vote, in
person or by proxy, for each share of Class A Common Stock
held by him of record, with cumulative voting rights in the
election of directors; and
(C) every holder of outstanding shares of Class B
Common Stock shall be entitled to cast thereon four votes, in
person or by proxy, for each share of Class B Common Stock
held by him of record, except as provided in sub-paragraph
(e)(ii) of this Article 6, with cumulative voting rights in
the election of directors.
(ii) For any matter upon which shareholders are entitled
to vote, such percentage as may be required by applicable law or these
Articles of Incorporation of the votes which may be cast by the
holders of shares of Class A Common Stock and Class B Common Stock
[and voting preferred stock to the extent required by sub-paragraph
(m)(iii)] voting together without regard to class, must be cast in
favor of such matter; provided, however, that:
(A) in the case of a Business Combination [as
defined in paragraph (b) of Article 7] involving a person or
an entity "controlling" or "under common control with" the
corporation, a holder of the Class B Common Stock shall be
entitled to cast only one vote for each share of Class B
Common Stock held by him of record; and
(B) as to Class A Common Stock and Class B Common
Stock, with respect to any proposed amendment to these
Articles of Incorporation which would (1) increase or decrease
the number of authorized shares of either Class A Common Stock
or Class B Common Stock, (2) increase or decrease the par
value of the shares of Class A Common Stock or Class B Common
Stock, (3) adversely alter or change the powers, preferences,
relative voting power or special rights of the shares of Class
A Common Stock or Class B Common Stock, or (4) require class
voting under the South Carolina Business Corporation Act, as
in effect on the date of such vote, a majority of the votes
entitled
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to be cast by the holders of the class so affected by the
proposed amendment, voting separately as a class, must also be
cast in favor of such matter.
For purposes of sub-paragraph (e)(ii)(A) of this
Article 6, "controlling" or "under common control with" means
the possession, direct or indirect, of the power to direct or
cause the direction of the policies of the corporation.
(f) CONVERSION OF THE CLASS B COMMON STOCK. Each share
of the Class B Common Stock may at any time be converted, at the election of
the holder thereof, into one fully paid and non-assessable share of Class A
Common Stock. Any holder of shares of Class B Common Stock may elect to
convert any or all of such shares held by such holder at one time or at various
times in the holder's discretion. This right shall be exercised by the
surrender of the certificate representing each share of Class B Common Stock to
be converted to the corporation at its principal executive offices or at such
other location as the corporation shall designate, accompanied by a written
notice of the election by the holder thereof to convert and (if required by the
corporation) by instruments of transfer, in form satisfactory to the
corporation, duly executed by such holder or his duly authorized attorney. The
issuance of a certificate or certificates for shares of Class A Common Stock
upon conversion of shares of Class B Common Stock shall be made without charge
for any stamp or other similar tax in respect of such issuance; provided,
however, that if any certificate or certificates is or are to be issued in a
name other than that of the holder of record of the share or shares of the
Class B Common Stock converted, the person or persons requesting the issuance
thereof shall pay to the corporation the amount of any tax which may be payable
in respect of any such transfer, or shall establish to the satisfaction of the
corporation that any such tax has been paid. As promptly as practicable after
the surrender for conversion of a certificate or certificates representing
shares of Class B Common Stock and the payment of any tax as hereinbefore
provided, the corporation will deliver to the holder of the certificate or
certificates, a certificate or certificates representing the number of shares
of Class A Common Stock issuable upon such conversion, issued in such name or
names as such holder may direct. The conversion shall be deemed to have been
made immediately prior to the close of business on the date of the surrender of
the certificate or certificates representing the shares of the Class B Common
Stock, or if on such date the transfer books of the corporation shall be
closed, then immediately prior to the close of business on the first day
thereafter that said books shall be open, and all rights of such holder arising
from ownership of shares of Class B Common Stock shall cease at such time, and
the person or persons in whose name or names the certificate or certificates
representing shares of Class A Common Stock are to be issued shall be treated
for all purposes as having become the record holder or holders of such shares
of Class A Common Stock at such time and shall have and may exercise all the
rights and powers appertaining thereto.
No adjustments in respect of past cash dividends shall be made
upon the conversion of any share of Class B Common Stock; provided, however,
that if any shares of Class B Common Stock shall be converted subsequent to the
record date for the payment of a cash or stock dividend or other distribution
on shares of Class B Common Stock but prior to such payment, the registered
holder of such shares at the close of business on such record date shall be
entitled to receive the cash or stock dividend or other distribution payable to
holders of Class A Common Stock.
The corporation shall at all times reserve and keep available,
solely for the purpose of issue upon conversion of outstanding shares of Class
B Stock, such number of shares of Class A Common Stock as may be issuable upon
conversion of all such outstanding shares of Class B Common Stock, provided the
corporation may deliver shares of Class A Common Stock which have previously
been exchanged for shares of Class B Common Stock.
(g) DURATION OF CLASS RIGHTS AND POWERS OF CLASS A COMMON
STOCK AND CLASS B COMMON STOCK. At any time when less than sixteen and
sixty-six one-hundredth per cent (16.66%) Of the aggregate number of all
outstanding shares of Class A Common Stock and Class B Common Stock
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is represented by outstanding shares of Class B Common Stock, any shares of the
Class B Common Stock which are then outstanding shall, without any action by
the Board of Directors or the holder or holders thereof, automatically convert
into, and become for all purposes, shares of Class A Common Stock, and the
provisions of these articles of incorporation which provide for different
voting or cash dividend rights for the Class A Common Stock and the Class B
Common Stock shall not be of any effect. All shares of Class A Common Stock
(including those shares resulting from the automatic conversion of Class B
Common Stock referred to above) which are then outstanding shall have equal and
general voting power in the election of directors and in all other matters upon
which shareholders of the corporation are entitled to vote or give consent,
subject to the provisions of paragraph (m) of this article 6, even if at such
time there shall have been fixed by the Board of Directors a record date for
voting at any meeting of shareholders. If any cash dividends shall have been
declared at such time but not paid, holders of the automatically converted
Class B Common Stock shall be entitled to the same cash dividend per share as
that payable to holders of Class A Common Stock and future cash dividends as
and when declared, shall be payable at the same rate for all shares of Class A
Common Stock which shall be the only class of Common Stock then outstanding.
The Board of Directors is hereby authorized to take such actions, consistent
with the south carolina business corporation act, as it deems appropriate or
advisable with respect to the replacement of certificates then outstanding,
evidencing ownership of the automatically converted Class B Common Stock, or
otherwise, in order to carry into effect the foregoing provisions.
(h) DIVIDENDS AND DISTRIBUTIONS ON CLASS A COMMON STOCK
AND CLASS B COMMON STOCK.
(i) Cash dividends. At any time shares of Class B Common
Stock are outstanding, if any cash dividends are declared by the Board
of Directors on Class B Common Stock, a cash dividend shall be
declared on shares of Class A Common Stock. Cash dividends per share
declared on Class A Common Stock shall equal at least one hundred and
ten per cent (110%) of the cash dividends per share on Class B Common
Stock.
(ii) Other Dividends and Distributions. Each share of
Class A Common Stock and each share of Class B Common Stock shall be
equal in respect of rights to dividends (other than cash dividends)
and distributions, when and as declared, in the form of stock or other
property of the corporation and in respect of distributions payable
upon liquidation of the corporation, except that in case of dividends
or other distributions payable in stock of the corporation, including
distributions pursuant to stock splits or divisions, which occur after
the date shares of Class B Common Stock are first issued by the
corporation, only shares of Class A Common Stock shall be distributed
with respect to Class A Common Stock and only shares of Class B Common
Stock shall be distributed with respect to Class B Common Stock. At
any time shares of Class B Common Stock are outstanding, neither the
Class A Common Stock nor the Class B Common Stock shall be split,
divided or combined, nor may stock dividends be distributed on either
thereof, unless the Class A Common Stock and the Class B Common Stock
are both split, divided or combined, or a stock dividend is
distributed upon each such class of common stock, at a rate per share
and in such manner as will maintain the same relative dividend rate
and voting and other rights of each such class of common stock.
(i) ISSUANCE OF CLASS A COMMON STOCK. The Board of
Directors of the corporation may from time to time authorize by resolution the
issuance of any or all shares of Class A Common Stock herein authorized in
accordance with the terms and conditions set forth in these articles of
incorporation for such purposes, in such amounts, to such persons,
corporations, or entities, and for such consideration, all as the Board OF
Directors in its discretion may determine and without any vote or other action
by the shareholders, except as otherwise required by law or as provided herein
in respect of a merger.
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(J) RESTRICTIONS ON TRANSFER OF CLASS B COMMON STOCK. Class B
Common Stock may be transferred only (i) to another Beneficial Owner [as
defined in sub-paragraph (d)(iii) of Article 7] of Class B Common Stock or (ii)
to any person at the death of the holder pursuant to a will or intestate
succession (such transferees being hereinafter referred to as "Permitted
Transferees"). Each certificate representing shares of Class B Common Stock
shall bear prominently a legend stating that restrictions on transfer and the
registration of transfer of the Class B Common Stock are provided in these
Articles of Incorporation. As a condition of any transfer of Class B Common
Stock, the corporation may require the record holder of the Class B Common
Stock to establish to the satisfaction of the corporation, by filing with the
corporation an appropriate certificate or affidavit, that any person to whom
the shares are being transferred is a Permitted Transferee. Should any
transferee or purported transferee of Class B Common Stock wish to contest any
decision of the corporation as to whether the transferee or purported
transferee is eligible to be registered as a transferee of Class B Common
Stock, then the Board of Directors in its sole discretion shall make the final
determination.
A holder of Class B Common Stock may pledge shares of Class B
Common Stock to a pledgee pursuant to a bona fide pledge as collateral security
for indebtedness due to the pledgee, provided that the shares may not be
transferred to, or registered in the name of, the pledgee unless the pledgee is
a Permitted Transferee. Upon any foreclosure or similar action of the pledge,
the pledged shares shall be automatically deemed to be converted into shares of
Class A Common Stock whether or not certificates representing the shares are
presented for transfer to the transfer agent, unless within five (5) business
days after the foreclosure or similar action the pledged shares are returned to
the pledging shareholder or transferred to a Permitted Transferee.
(k) FAILURE TO DECLARE AN EFFECTIVE DATE. If the Board
of Directors does not declare the Effective Date prior to April 1, 1990, then
the corporation shall not have the authority to issue shares of Class A Common
Stock or Class B Common Stock, and the corporation shall be authorized only to
issue 40,000,000 shares of Common Stock, par value $.25 per share, with the
relative rights, preferences and limitations set forth in paragraphs (a) and
(b) of this Article 6, and 1,000,000 shares of voting preferred stock as
provided in this Article 6.
(l) DIVIDENDS SUBJECT TO PAYMENT OF DIVIDENDS ON VOTING
PREFERRED STOCK. In no event, so long as any of the voting preferred stock
shall be outstanding, shall any dividends whatsoever, whether in cash, stock or
otherwise, be paid or declared, nor shall any distribution be made on the
Common Stock, or if the Effective Date is declared, Class A Common Stock, or
Class B Common Stock, unless full dividends on all outstanding shares of voting
preferred stock of all series for all past quarterly dividend periods and for
the current quarter shall have been paid or declared and set apart for payment.
(m) VOTING PREFERRED STOCK.
(i) The Board of Directors is hereby authorized to issue
the voting preferred stock from time to time in one or more series,
which voting preferred stock shall be preferred to the Common Stock
(or if applicable, as a result of the declaration of the Effective
Date, Class A Common Stock and Class B Common Stock) as to dividends
and distribution of assets of the corporation on dissolution and shall
have such distinctive designations as may be stated in the resolution
or resolutions providing for the issue of such stock adopted by the
Board of Directors. In such resolution or resolutions providing for
the issuance of shares of each particular series, the Board of
Directors is expressly authorized to fix the number of shares
constituting such series and to fix the relative rights and
preferences of the shares of the series so established to the full
extent allowable by law except insofar as such rights and preferences
are fixed herein. Such authorization in the Board of Directors shall
expressly include the authority to fix and determine the relative
rights and preferences of such shares in the following respects:
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(A) the annual dividend rate on such shares and
the date from which dividends shall be accumulated;
(B) whether such shares may be redeemed and, if
so, the redemption price, which may vary at different dates,
and the terms and conditions of the redemption, including
possible differences with respect to any purchase, retirement
or sinking fund;
(C) the amount payable upon such shares in event
of voluntary and involuntary liquidation, provided that the
aggregate amount payable upon involuntary liquidation on all
shares of voting preferred stock of all series may not exceed
$50,000,000.00, plus any accumulated dividends;
(D) purchase, retirement or sinking fund
provisions, if any, for the redemption or purchase of such
shares; and
(E) the terms and conditions, if any, on which
such shares may be convertible into, or exchangeable for,
shares of Common Stock (or if applicable, as a result of the
declaration of the Effective Date, Class A Common Stock) or
shares of any other series or class.
All shares of voting preferred stock shall be of equal rank
and shall be identical, except in respect to the particulars that may be fixed
by the Board of Directors as hereinabove provided in this sub-paragraph and
which may vary among the series.
(ii) The holders of the voting preferred stock of each
series, in preference to the holders of the Common Stock (or if
applicable, as a result of the declaration of the Effective Date,
Class A Common Stock and Class B Common Stock), shall be entitled to
receive, as and when declared by the Board of Directors, cumulative
cash dividends at the rate for such series fixed in accordance with
the resolution or resolutions of the Board of Directors establishing
such series, payable quarterly on dates as may be fixed in such
resolution or resolutions. No dividends shall be paid upon, or
declared on, any share of voting preferred stock for any quarterly
dividend period unless at the same time dividends for the same
quarterly dividend period shall be paid upon, or declared on, all
shares of voting preferred stock of all series then issued and
outstanding ratably in proportion to the respective annual dividend
rates fixed therefor as hereinabove provided. Cash dividends upon
each series of voting preferred stock shall commence to accrue and
shall be cumulative,
(A) if issued on or prior to the record date for
the first dividend on shares of such series, then from the
date fixed for the purpose by the Board of Directors in its
resolutions establishing such series;
(B) if issued during the period commencing
immediately after the record date for a dividend on shares of
such series and ending at the close of the payment date for
such dividend, then from such last mentioned dividend payment
date; and
(C) otherwise from the dividend payment date next
succeeding the date of issue of such shares.
(iii) The holders of voting preferred stock of all
series shall be entitled to one vote for each of the shares of such
stock held by them of record at any meeting of the shareholders,
except that there shall be cumulative voting in the election of the
directors.
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The Common Stock (or if applicable, as a result of the declaration of
the Effective Date, Class A Common Stock and Class B Common Stock) and
the voting preferred stock shall vote together as one class, except
with respect to matters which are required by law or by the provisions
of sub-paragraph (m)(viii) of this Article 6 to be voted upon
separately and except that while the holders of the voting preferred
stock, voting as a class, are entitled to elect an additional two
directors as hereinafter provided, they shall not be entitled to
participate with the holders of the Common Stock (or if applicable, as
a result of the declaration of the Effective Date, Class A Common
Stock and Class B Common Stock) in the election of any other
directors.
(iv) If and whenever six (6) quarterly dividends
on the shares of the voting preferred stock, whether or not
consecutive, shall be unpaid, in whole or in part, then the number of
directors of the corporation shall be increased by two (2), and the
voting preferred stock, voting separately as a class, shall be
entitled to elect such additional two members of the Board of
Directors at any annual meeting or at a special meeting of
shareholders called as hereinafter provided. Such additional voting
power shall continue to vest in the voting preferred stock until all
arrears in payment of quarterly dividends thereon shall have been paid
and the dividends thereon for the current quarter shall have been
declared and funds sufficient therefor set aside, and when so paid or
provided for, the voting preferred stock shall be divested of such
additional voting power, but subject always to the same provisions for
the vesting of such additional voting power in the voting preferred
stock in case of any similar future dividend default or defaults.
(v) At any time when such additional voting power
shall be so vested in the voting preferred stock, the Secretary of the
corporation may, and upon the written request of the holders of record
of ten per cent (10%) or more in amount of the voting preferred stock
then outstanding addressed to him at the principal office of the
corporation shall, call a special meeting of the holders of the voting
preferred stock for the purpose of electing such additional two
directors; provided, however, that the Secretary shall not be required
to call such special meeting if such request is received less than
ninety (90) days before the date fixed for the annual meeting of
shareholders. Any such special meeting shall be held at the earliest
practicable date after receipt of such request.
(vi) At any annual meeting at which the voting
preferred stock shall be entitled to elect such additional two
directors or at any special meeting called as provided above for such
purpose, the holders of the majority in amount of the then outstanding
voting preferred stock shall be sufficient to constitute a quorum,
whether present in person or by proxy. Voting by the holders of the
voting preferred stock shall be cumulative as provided in paragraph
(a) of this Article 6, and the two candidates who receive the greatest
number of votes cast by the holders of the voting preferred stock at
the meeting shall be elected as such additional directors even though
not receiving a majority of the votes cast. The directors so elected
shall serve until the next annual meeting or until their respective
successors shall be elected and shall qualify; provided, however,
that, if the holders of the voting preferred stock shall be divested
of their additional voting power as above provided, then the persons
elected as directors by the holders of the voting preferred stock
voting as a class shall continue in office as directors until the next
annual meeting of the shareholders at which time the terms of office
of such persons shall terminate and the number of the Board of
Directors shall be reduced accordingly.
(vii) If, at any time while the holders of the voting
preferred stock shall be entitled to elect such additional two
directors as above provided, the number of directors who have been
elected by the holders of the voting
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preferred stock voting as a class shall, by reason of resignation,
death or removal, be reduced to less than two, such vacancy shall be
filled by the remaining director elected by the holders of the voting
preferred stock then in office, if any, or if no such director is then
in office, of if such vacancy is not filled by such director within
forty (40) days after the creation of such vacancy, the Secretary of
the corporation shall call a special meeting of the holders of the
voting preferred stock to fill such vacancy or vacancies. Any
director elected by the holders of the voting preferred stock or
elected to fill any vacancy by the remaining director then in office
may be removed from office by the holders of the voting preferred
stock at an annual meeting or at a special meeting called for such
purpose. A special meeting of the holders of the voting preferred
stock may be called by the Board of Directors and shall be called by
the Secretary of the corporation upon the written request of the
holders of record of ten per cent (10%) or more in amount of the
voting preferred stock then outstanding addressed to him at the
principal office of the corporation for the purpose of removing such
director; provided, however, that the Secretary shall not be required
to call such special meeting if such request is received less than
ninety (90) days before the date fixed for the annual meeting of
shareholders. Such special meetings of the holders of the voting
preferred stock for the purpose of removing such a director shall be
held within forty (40) days after the receipt of such request. At any
special meeting of the holders of the voting preferred stock to fill
such vacancy or vacancies or to remove a director elected by the
remaining director to fill such a vacancy, the provisions above
provided as to the quorum and vote required for the holders of the
voting preferred stock to elect directors shall apply.
(viii) So long as any shares of voting preferred
stock are outstanding, without the affirmative vote of the holders of
at least two-thirds of the voting preferred stock at the time
outstanding voting as a class, given in person or by proxy at any
meeting called for the purpose, the corporation shall not, by an
amendment to the Articles of Incorporation or the by-laws, effect any
one or more of the following:
(A) increase or decrease the aggregate number of
authorized shares of the voting preferred stock; or
(B) increase or decrease the par value of the
shares of voting preferred stock; or
(C) effect an exchange, or create a right of
exchange, of all or any part of the shares of the Common Stock
(or if applicable, as a result of the declaration of the
Effective Date, Class A Common Stock or Class B Common Stock)
or of another class ranking as to payment of dividends and
distributions of assets junior to the voting preferred stock
into shares of the voting preferred stock; or
(D) change the shares of the voting preferred
stock into the same or a different number of shares of Common
Stock (or if applicable, as a result of the declaration of the
Effective Date, Class A Common Stock or Class B Common Stock)
or of another class of stock except pursuant to such terms and
conditions with respect to the conversion or exchange of the
shares of voting preferred stock as may have been fixed by the
Board of Directors pursuant to the authorization hereinabove
granted; or
(E) authorize any class of stock ranking either
as to payment of dividends or distribution of assets prior to
the voting preferred stock; or
(F) change in any material way the voting powers,
rights or preferences of the voting preferred stock to the
prejudice of the holders thereof; provided, however, that if
any proposed action would change in
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any material way the voting powers, rights or preferences of
one or more but not all series of the voting preferred stock
at the time outstanding, or would unequally so change such
powers, rights or preferences of two or more series of such
class, in each case to the prejudice of the holders of shares
of such series, then the affirmative vote of the holders of at
least two-thirds of the shares of each such series so changed
shall be required in addition to the affirmative vote of the
holders of two-thirds of the voting preferred stock at the
time outstanding voting as a class; provided, further,
however, that none of the following actions shall be deemed to
change in any material way the voting powers, rights or
preferences of the voting preferred stock, or any series
thereof, to the prejudice of the holders thereof:
(1) the creation or authorization of a
new class of stock ranking as to the payment of
dividends and the distribution of assets junior to
the voting preferred stock; or
(2) an increase in the authorized amount
of the Common Stock (or if applicable, as a result of
the declaration of the Effective Date, Class A Common
Stock or Class B Common Stock) or of any class of
stock ranking junior to the voting preferred stock;
or
(3) an increase in the number of
directors of the corporation; or
(4) the fixing of the relative rights
and preferences of the shares of other series by the
Board of Directors pursuant to the authorization
hereinabove granted.
7. MINIMUM PRICE AND PROCEDURAL REQUIREMENTS IN CONNECTION WITH
CERTAIN BUSINESS TRANSACTIONS. The following provisions concerning certain
actions and transactions are established:
(a) In addition to any affirmative vote required by law
or any other provision of these articles of incorporation, and except as
otherwise expressly provided in paragraph (c) of this article 7:
(i) any merger or consolidation of the corporation or any
Subsidiary (as hereinafter defined) with (A) any Interested
Shareholder (as hereinafter defined) or (B) any person (whether or not
itself an Interested Shareholder) which is, or after such merger or
consolidation would be, an Affiliate (as hereinafter defined) of any
Interested Shareholder; or
(ii) any sale, lease, exchange, mortgage, pledge, transfer
or other disposition (in one transaction or in a series of related
transactions) to or with any Interested Shareholder or any Affiliate
of any Interested Shareholder of any assets of the corporation or any
Subsidiary having an aggregate Fair Market Value (as hereinafter
defined) as of the Announcement Date (as hereinafter defined) in an
amount which is more than five per cent (5%) of the total value of the
assets of the corporation and its consolidated subsidiaries as
reflected on the most recent Balance Sheet (as hereinafter defined) of
the corporation; or
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(iii) the issuance or transfer by the corporation or any
Subsidiary (in one transaction or in a series of related transactions)
of any securities of the corporation or any Subsidiary to any
Interested Shareholder or any Affiliate of any Interested Shareholder
in exchange for cash, securities or other property (or a combination
thereof) having an aggregate Fair Market Value as of the Announcement
Date in an amount which is more than five per cent (5%) of the total
value of the assets of the corporation and its consolidated
subsidiaries as reflected on the most recent Balance Sheet of the
corporation; or
(iv) the adoption of any plan or proposal for the
liquidation or dissolution of the corporation proposed by or on behalf
of any Interested Shareholder or any Affiliate of any Interested
Shareholder; or
(v) any reclassification of securities (including any
reverse stock split), or recapitalization of the corporation, or any
merger or consolidation of the corporation with any Subsidiary, or any
other transaction (whether or not with or into or otherwise involving
any Interested Shareholder) which has the effect, directly or
indirectly, of increasing the proportionate share of the outstanding
shares of any class of Equity Security (as hereinafter defined) of the
corporation or any Subsidiary which is directly or indirectly owned by
any Interested Shareholder or any Affiliate of any Interested
Shareholder;
shall require the affirmative vote of the holders of at least seventy-five per
cent (75%) of the voting power of the outstanding shares of capital stock of
the corporation entitled to vote in the election of directors (the "Voting
Stock"), voting together as a single class. Such affirmative vote shall be
required notwithstanding the fact that no vote may be required, or that a
lesser percentage may be specified, by law or in any agreement with any
national securities exchange or otherwise.
(b) The term "Business Combination" means any transaction
described in sub-paragraphs (a)(i) through (v) of this Article 7.
(c) The provisions of paragraph (a) of this Article 7
shall not be applicable to a Business Combination, and the Business Combination
shall require only the affirmative vote required by law and any other provision
of these Articles of Incorporation, if all of the conditions specified in
either of the following sub-paragraphs (c)(i) or (ii) are met:
(i) the Business Combination shall have been approved by
a majority of the Continuing Directors (as hereinafter defined); or
(ii) all of the following conditions shall have been met:
(A) the amount of cash to be received per share
by holders of Common Stock (or if applicable, as a result of
the declaration of the Effective Date, Class A Common Stock
and Class B Common Stock) in the Business Combination is at
least equal to the highest of the following:
(1) (if applicable) the highest Fair
Market Value of the consideration per share
(including any brokerage commissions, transfer taxes
and soliciting dealers' fees) paid by the Interested
Shareholder in question for any shares of Common
Stock (or if applicable, as a result of the
declaration of the Effective Date, Class A Common
Stock or Class B Common Stock) acquired by it within
the two-year period immediately prior to the first
public announcement of the
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terms of the proposed Business Combination (the
"Announcement Date"); or
(2) the Fair Market Value per share of
Common Stock (or if applicable, as a result of the
declaration of the Effective Date, Class A Common
Stock or Class B Common Stock) on the Announcement
Date.
(B) the amount of cash to be received per share
by holders of any other class of outstanding Voting Stock is
at least equal to the highest of the following:
(1) (if applicable) the highest Fair
Market Value of the consideration per share
(including any brokerage commissions, transfer taxes
and soliciting dealers' fees) paid by the Interested
Shareholder in question for any shares of such class
of Voting Stock acquired by it within the two-year
period immediately prior to the Announcement Date; or
(2) (if applicable) the highest
preferential amount per share to which the holders of
such class of Voting Stock are entitled in the event
of any voluntary or involuntary liquidation or
dissolution of the corporation; or
(3) the Fair Market Value per share of
such class of Voting Stock on the Announcement Date.
(C) the consideration to be received by holders
of each class of outstanding Voting Stock must be paid in
cash. The price determined in accordance with sub-paragraphs
(c)(ii)(A) through (B) of this Article 7 shall be subject to
appropriate adjustment in the event of any stock dividend,
stock split, combination of shares or similar event.
(D) after the Interested Shareholder in question
has become an Interested Shareholder and prior to the
consummation of such Business Combination:
(1) except as approved by a majority of
the Continuing Directors, there shall have been no
failure to declare and pay, in whole or in part, at
the regular date therefor any dividends (whether or
not cumulative) on any outstanding stock having
preference over the Common Stock (or if applicable,
as a result of the declaration of the Effective Date,
Class A Common Stock and Class B Common Stock) as to
dividends or upon liquidation;
(2) there shall have been (x) no
reduction in the annual rate of dividends paid on
Common Stock (or if applicable, as a result of the
declaration of the Effective Date, Class A Common
Stock or Class B Common Stock) [except as necessary
to reflect any subdivision of the Common Stock (or if
applicable, as a
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13
result of the declaration of the Effective Date,
Class A Common Stock and Class B Common Stock)],
except as approved by a majority of the Continuing
Directors, and (y) no increase in such annual rate of
dividends [except as necessary to reflect any
reclassification, including any reverse stock split,
recapitalization, reorganization or any similar
transaction which has the effect of reducing the
number of outstanding shares of Common Stock (or if
applicable, as a result of the declaration of the
Effective Date, Class A Common Stock or Class B
Common Stock)], except as approved by a majority of
the Continuing Directors; and
(3) such Interested Shareholder shall
not have become the beneficial owner of any
additional shares of Voting Stock subsequent to the
transaction in which it became an Interested
Shareholder.
(E) after the Interested Shareholder in question
has become an Interested Shareholder, it shall not have
received the benefit, directly or indirectly (except
proportionately with all other shareholders of the
corporation), of any loans, advances, guarantees, pledges or
other financial assistance or any tax credits or other tax
advantages provided by the corporation, whether in
anticipation of or in connection with such Business
Combination or otherwise.
(F) A proxy or information statement describing
the proposed Business Combination and complying with the
requirements of the Securities Exchange Act of 1934 (the
"Act") and the rules and regulations thereunder (or any
subsequent provisions replacing the Act and the rules and
regulations thereunder) shall be mailed to the shareholders of
the corporation at least thirty (30) days prior to the
consummation of such Business Combination (whether or not such
proxy or information statement is required to be mailed
pursuant to the Act or subsequent provisions).
(d) For purposes of this Article 7:
(i) a "person" means any individual, proprietorship,
partnership, corporation or other entity, or any group of two or more
of the foregoing acting together.
(ii) "Interested Shareholder" means any person (other than
the corporation or any Subsidiary) who or which:
(A) is the beneficial owner, directly or
indirectly, of shares of Voting Stock having ten per cent
(10%) or more of the voting power of the outstanding Voting
Stock; or
(B) is an Affiliate of the corporation and at any
time within the two-year period immediately prior to the date
in question was the beneficial owner, directly or indirectly,
of shares of Voting Stock having ten per cent (10%) or more of
the voting power of the then outstanding Voting Stock; or
(C) is an assignee of, or has otherwise succeeded
to, any shares of Voting Stock which were at any time within
the two-year period
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immediately prior to the date in question beneficially owned
by an Interested Shareholder, if such assignment or succession
occurred in the course of a transaction or series of
transactions not involving a public offering within the
meaning of the Securities Act of 1933 and the rules and
regulations thereunder.
(iii) A person is a "beneficial owner" of any Voting Stock:
(A) that such person or any of its Affiliates or
Associates (as hereinafter defined) beneficially owns directly
or indirectly; or
(B) that such person or any of its Affiliates or
Associates has (1) the right to acquire (whether such right is
exercisable immediately or only after the passage of time or
upon the occurrence of an event, or both), pursuant to any
agreement, arrangement or understanding or upon the exercise
of conversion rights, exchange rights, warrants or options, or
otherwise, or (2) the right to vote pursuant to any agreement,
arrangement or understanding; or
(C) that is beneficially owned, directly or
indirectly, by any other person with which such person or any
of its Affiliates or Associates has any agreement, arrangement
or understanding for the purpose of acquiring, holding, voting
or disposing of any shares of Voting Stock.
(iv) For the purpose of determining whether a person is an
Interested Shareholder pursuant to sub- paragraph (d)(ii) of this
Article 7, the number of shares of Voting Stock deemed to be
outstanding shall include shares deemed owned through application of
sub-paragraph (d)(iii) of this Article 7, but shall not include any
other shares of Voting Stock that may be issuable pursuant to any
agreement, arrangement or understanding, or upon exercise of
conversion rights, warrants or options, or otherwise.
(v) "Affiliate" and "Associate" have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Act as in effect on March 1, 1987.
(vi) "Subsidiary" means any corporation of which a
majority of any class of Equity Security is owned, directly or
indirectly, by the corporation, provided that for the purposes of the
definition of Interested Shareholder set forth in sub-paragraph
(d)(ii) of this Article 7, the term "Subsidiary" shall mean only a
corporation of which a majority of each class of Equity Security is
owned, directly or indirectly, by the corporation.
(vii) "Continuing Director" means:
(A) any member of the Board of Directors who was
a member of the Board on March 1, 1987,
(B) any member of the Board of Directors who is
unaffiliated with the Interested Shareholder in question and
who was a member of the Board prior to the time that such
Interested Shareholder became an Interested Shareholder, and
(C) any member of the Board of Directors who was
nominated or elected by a majority of Continuing Directors
then on the Board of Directors.
(viii) "Fair Market Value" means:
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(A) in the case of stock, the highest closing
sale price during the 30-day period immediately preceding the
date in question of a share of such stock on the Composite
Tape for New York Stock Exchange-Listed Stocks, or, if such
stock is not quoted on the Composite Tape, on the New York
Stock Exchange, or, if such stock is not listed on such
Exchange, on the principal United States securities exchange
registered under the Act on which such stock is listed, or, if
such stock is not listed on any such exchange, the highest
closing bid quotation with respect to a share of such stock
during the 30-day period immediately preceding the date in
question on the National Association of Securities Dealers,
Inc. Automated Quotations System or any system then in use, or
if no such quotations are available, the fair market value on
the date in question of a share of such stock as determined by
the Board of Directors in good faith; and (B) in the case of
property other than cash or stock, the fair market value of
such property on the date in question as determined by the
Board of Directors in good faith.
(ix) "Equity Security" has the meaning ascribed to such
term in Section 3(a)(11) of the Act, as in effect on March 1, 1987.
(x) "Balance Sheet" as of any particular time means the
most recent publicly available consolidated balance sheet of the
corporation and its consolidated subsidiaries audited by the
corporation's independent public accountants.
(e) A majority of the entire Board of Directors shall
have the power and duty to determine for purposes of this Article 7, on the
basis of information known to the directors after reasonable inquiry,
(i) whether a person is an Interested Shareholder,
(ii) the number of shares of Voting Stock beneficially
owned by any person,
(iii) whether a person is an Affiliate or Associate of
another, and
(iv) whether the assets that are the subject of any
Business Combination have, or the consideration to be received for the
issuance or transfer of securities by the corporation or any
Subsidiary in any Business Combination has, an aggregate Fair Market
Value as of the Announcement Date in an amount which is more than five
per cent (5%) of the total value of the assets of the corporation and
its consolidated subsidiaries as reflected on the most recent Balance
Sheet of the corporation. A majority of the entire Board of Directors
shall have the further power to interpret all of the terms and
provisions of this Article 7.
(f) Notwithstanding any other provision of these Articles
of Incorporation or the by-laws of the corporation (and notwithstanding the
fact that a lesser percentage may be specified by law, these Articles of
Incorporation or the by-laws of the corporation), the affirmative vote of the
holders of at least seventy-five per cent (75%) of the voting power of the
outstanding Voting Stock, voting together as a single class, shall be required
to alter, amend, adopt any provision inconsistent with, or repeal this Article
7.
8. LIMITATION ON PERSONAL LIABILITY OF DIRECTORS. No director of
the corporation shall have personal liability to the corporation or its
shareholders for monetary damages for breach of fiduciary duty as a director
unless and to the extent that such elimination or limitation of personal
liability is prohibited by the laws of the State of South Carolina.
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9. AMENDMENT. The corporation reserves the right to amend,
alter, change or repeal any provision contained in these Restated Articles of
Incorporation in the manner now or hereafter prescribed by law, and all rights
and powers herein conferred on shareholders, directors and officers are subject
to this reserved power.
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