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Exhibit 3(a)(ii)
HUNTINGTON PREFERRED CAPITAL, INC.
AMENDED AND RESTATED
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ARTICLES OF INCORPORATION
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(adopted [___________], 2001)
ARTICLE I
NAME
The name of the Corporation shall be Huntington Preferred Capital, Inc.
ARTICLE II
PRINCIPAL OFFICE
The place in Ohio where the principal office of the Corporation is to
be located is the City of Columbus, Franklin County, Ohio.
ARTICLE III
PURPOSE
The purposes for which the Corporation is formed are to engage in any
business or activity for which corporations may be formed under Sections 1701.01
to 1701.98, inclusive, of the Revised Code of Ohio.
ARTICLE IV
CAPITAL STOCK
4.1 DEFINITIONS. As used in this Article IV and subsequent Articles:
(a) "Affiliate" of any specified Person means (i) any other Person
which, directly or indirectly, is in control of, is controlled by or is under
common control with such specified Person or (ii) any other Person who is a
director or executive officer (A) of such specified Person, (B) of any
Subsidiary of such specified Person, or (C) of any Person described in clause
(i) above. For purposes of this definition, control of a Person means the power,
direct or indirect, to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise; and the terms
"controlling" and "controlled' have meanings correlative to the foregoing.
(b) The "Bank" means The Huntington National Bank.
(c) "Business Day" means any day other than a Saturday, Sunday, or a
bank holiday in the United States.
(d) "Capital Stock" of the Corporation means the common shares of the
Corporation and the Preferred Shares.
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(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Indebtedness" means any indebtedness for borrowed money or
guarantees of indebtedness for borrowed money.
(g) "Permitted Indebtedness" means (i) any Indebtedness incurred by the
Corporation in an aggregate amount not to exceed 20% of the shareholders' equity
of the Corporation, as determined in accordance with generally accepted
accounting principles in the United States, plus (ii) any additional
Indebtedness related to any and all advances or other financial accommodations
made or granted from time to time by the Federal Home Loan Bank of Cincinnati to
or for the benefit of the Bank, where the Corporation participates as a
co-borrower, guarantor, or in any other capacity where any assets of the
Corporation are pledged as collateral.
(h) "Person" means an individual, corporation, partnership, estate,
trust (including a trust qualified under Sections 401(a) or 501(c)(17) of the
Code), a portion of a trust permanently set aside for or to be used exclusively
for the purposes described in Section 642(c) of the Code, association, private
foundation within the meaning of Section 509(a) of the Code, joint stock
company, or other entity.
(i) "Preferred Shares" of the Corporation means, collectively, the
Class A, Class B, Class C, and Class D Preferred Shares, and the Preferred
Stock.
(j) "REIT" is defined in Section 7.1 hereof.
(k) "Subsidiary" of a Person means any corporation, association,
partnership, or other business entity of which more than 50% of the total voting
power of shares of capital stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers, or trustees thereof is at the time
owned, directly or indirectly, by (i) such Person, (ii) such Person and one or
more Subsidiaries of such Person, or (iii) one or more Subsidiaries of such
Person.
4.2 AUTHORIZED SHARES. The number of shares of Capital Stock which the
Corporation is authorized to issue is 40,501,000, of which:
(i) 14,000,000 shall be common shares, without par value;
(ii) 1,000 shall be Class A Preferred Shares, $1,000 par value per
share;
(iii) 500,000 shall be Class B Preferred Shares, $1,000 par value per
share;
(iv) 2,000,000 shall be Class C Preferred Shares, $25.00 par value per
share;
(v) 14,000,000 shall be Class D Preferred Shares, $25.00 par value
per share; and
(vi) 10,000,000 shall be Preferred Stock, $25.00 par value per share.
The rights and preferences of the Class A, Class B, Class C, and Class D
Preferred Shares and the Preferred Stock shall be as set forth in Sections 4.2
through 4.6 hereof.
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4.3 CLASS A PREFERRED SHARES.
4.3.1 DEFINITIONS. As used herein in reference to the Class A Preferred
Shares:
(a) "Accrued Dividends" shall mean an amount equal to dividends
on the Class A Preferred Shares at the rate specified in Section 4.3.2(a)
hereof, computed from the date on which such dividends began to accrue on such
shares to the date to which dividends are stated to accrue, less the aggregate
amount of dividends previously paid thereon.
(b) "Junior Stock" shall mean the common shares and the Class B
Preferred Shares.
(c) "Parity Stock" shall mean the Class C and Class D
Preferred Shares.
4.3.2 DIVIDENDS.
(a) The dividend rate for the Class A Preferred Shares shall be
$80.00 per share per annum, payable annually in December of each year to holders
thereof of record on the respective record dates fixed for such purpose by the
Board of Directors in advance of payment of such dividend. The holders of Class
A Preferred Shares shall be entitled to receive such cash dividends, and the
Corporation shall be bound to pay the same, but only as and when declared by the
Board of Directors, out of funds legally available for the payment thereof.
(b) No full dividends or other distributions shall be
authorized, declared, or paid or set apart for payment on any Parity Stock or
Junior Stock (other than in common shares or other Junior Stock) for any period
unless full dividends have been or contemporaneously are authorized, declared
and paid or authorized and declared and a sum sufficient for the payment thereof
set apart for such payment on the Class A Preferred Shares for the calendar year
in which such period ends. When dividends are not paid in full (or a sum
sufficient for such full payment is not so set apart) for any calendar year on
the Class A Preferred Shares and for any dividend payment period for any Parity
Stock, dividends authorized and declared on the Class A Preferred Shares and
Parity Stock shall only be authorized and declared pro rata based upon (i) the
sum of any Accrued Dividends on the Class A Preferred Shares plus amounts that
would have been paid on the Class A Preferred Shares had dividends been
authorized and declared in full for the current year, and (ii) the amount that
would have been paid on such Parity Stock had dividends been authorized and
declared in full for the current dividend payment period for such Parity Stock.
4.3.3 LIQUIDATION PREFERENCE. The amount payable on the Class A
Preferred Shares in the event of any voluntary or involuntary liquidation,
dissolution, or winding-up of affairs of the Corporation shall be $1,000 per
share, plus Accrued Dividends to the date fixed for payment of distributable
amounts on the Class A Preferred Shares. Upon any involuntary liquidation,
dissolution, or winding-up of the Corporation, the holders of Class A Preferred
Shares shall be entitled, before any distribution shall be made to the holders
of any shares of any class of Junior Stock, to be paid the full preferential
amount of $1,000 per share, but the holders of Class A Preferred Shares shall
not be entitled to any further payment. Upon any voluntary liquidation,
dissolution, or winding-up of the Corporation, the holders of Class A Preferred
Shares shall be entitled, before any distribution shall be made to the holders
of any shares of any class of Junior Stock, to be paid the full preferential
amount of $1,000 per share and thereafter, to the extent that net assets are
available in the Corporation, the Class A
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Preferred Shares shall share ratably with the common shares in the distribution
of such available net assets. If the amounts available for distribution in
respect of the Class A Preferred Shares and any outstanding Parity Stock upon
any such voluntary or involuntary liquidation, dissolution, or winding up are
not sufficient to satisfy the full liquidation rights of all of the outstanding
Class A Preferred Shares and such Parity Stock, then the holders of such
outstanding shares shall share ratably in any such distribution of assets in
proportion to the full respective preferential amounts to which they are
entitled.
4.3.4 VOTING RIGHTS. The Class A Preferred Shares shall be non-voting,
except as otherwise required by law.
4.3.5 REDEMPTION.
(a) The Class A Preferred Shares shall be redeemable by the
Corporation at any time at $1,000 per share, plus Accrued Dividends to the
redemption date on shares redeemed (the "Redemption Price") with funds legally
available for such purpose. The Corporation, at the option of the Board of
Directors, may at any time redeem the whole, or from time to time may redeem any
part, of the Class A Preferred Shares at such time or times by paying the
Redemption Price, in cash, to the holders thereof; provided, however, that less
than all of the Class A Preferred Shares may be redeemed only after full
cumulative dividends upon the Class A Preferred Shares then outstanding shall
have been paid for all past dividend periods and after or concurrently with
making payment of, or declaring or setting apart for payment, the full dividend
on all outstanding Class A Preferred Shares for the then current dividend
period. If less than all of the outstanding Class A Preferred Shares are to be
called for redemption, the shares to be redeemed shall be selected either by lot
or pro rata, at the option of the Board of Directors, and in such manner as may
be prescribed by resolution of the Board of Directors.
(b) Not more than 60 days and not less than 10 days prior to the
date established for such redemption (the "Redemption Date"), notice of the
proposed redemption shall be mailed to the holders of record of the Class A
Preferred Shares to be redeemed, such notice to be addressed to each such
shareholder at his last known address shown on the records of the Corporation,
and the time of mailing such notice shall be deemed to be the time of the giving
thereof. On or after the Redemption Date, each holder of Class A Preferred
Shares called for redemption shall surrender his certificate(s) for such shares
to the Corporation at the place designated in such notice and shall thereupon be
entitled to receive payment of the Redemption Price. In case less than all the
shares represented by any such surrendered certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares. If such notice
of redemption shall have been given as aforesaid, and if on or before the
Redemption Date the funds necessary for the redemption shall have been set aside
so as to be and continue available therefor, then, notwithstanding that the
certificates representing any Class A Preferred Shares so called for redemption
shall not have been surrendered, the dividends thereon shall cease to accrue
after the Redemption Date and all rights with respect to the shares so called
for redemption shall forthwith after such Redemption Date cease, except only the
right of the holders to receive the Redemption Price, without interest. If such
notice of redemption of all or any part of the Class A Preferred Shares shall
have been mailed as aforesaid and the Corporation shall thereafter deposit money
for the payment of the Redemption Price pursuant thereto with any bank or trust
company (hereinafter referred to as the "depository"), including any Affiliate
of the Corporation, selected by the Board of Directors for that purpose, to be
applied to such redemption, then from and after the making of such deposit, such
shares shall not be deemed to be outstanding for any purpose, and the rights of
the holders thereof shall be limited to the rights to receive payment of the
Redemption Price, without interest but including Accrued Dividends to the
Redemption Date, from the depository upon endorsement, if required, and
surrender of the certificates therefor. The Corporation shall be entitled to
receive, from time to time, from the depository, the interest, if any, allowed
on such moneys deposited with it, and the holders of any shares so redeemed
shall have no claim to any such interest. Any moneys so deposited and remaining
unclaimed at the end of three years from the Redemption Date shall, if
thereafter requested by resolution of the Board of Directors, be repaid to the
Corporation, and in the event of such repayment to the Corporation, such holders
of record of the shares so called for
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redemption as shall not have made claim against such moneys prior to such
repayment to the Corporation shall be deemed to be unsecured creditors of the
Corporation for an amount equivalent to the amount deposited as above stated for
the redemption of such shares and so repaid to the Corporation, but shall in no
event be entitled to any interest.
(c) Subject to the provisions hereof, the Board of Directors
shall have authority to prescribe from time to time the manner in which Class A
Preferred Shares shall be redeemed.
(d) Nothing herein contained shall limit any legal right of the
Corporation to purchase any shares of the Class A Preferred Shares; provided,
however, that, except in accordance with an offer made to all holders of Class A
Preferred Shares, the Corporation shall not purchase or otherwise acquire for a
consideration, or permit any Affiliate to purchase or otherwise acquire for a
consideration, any Class A Preferred Shares unless full dividends shall have
been paid or declared and set apart for payment on the Class A Preferred Shares
for all past dividends periods.
(e) All Class A Preferred Shares redeemed at the option of the
Corporation shall be permanently retired in the manner provided by law.
4.3.6 REPURCHASE OF CLASS A PREFERRED SHARES. Subject to limitations
imposed herein, the Corporation may purchase and sell Class A Preferred Shares
from time to time to such extent, in such manner, and upon such terms as the
Board of Directors may determine; provided, however, that the Corporation shall
not use any of its funds for any such purchase when there are reasonable grounds
to believe that the Corporation is, or by such purchase would be rendered,
insolvent.
4.3.7 RESTRICTIONS ON TRANSFER. The Class A Preferred Shares are
transferable except that the Corporation may deny any proposed transfer of Class
A Preferred Shares which, in the reasonable judgement of the Corporation, may
adversely impact the ability of the Corporation to
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maintain its status as a
corporation qualified for treatment as a REIT under relevant tax laws and
regulations.
4.4 CLASS B PREFERRED SHARES.
4.4.1 DEFINITIONS. As used herein in reference to the Class B Preferred
Shares:
(a) "Accrued Dividends" shall mean an amount equal to dividends
on the Class B Preferred Shares at the rate specified in Section 4.4.2(a)
hereof, if, as, and when declared by the Board of Directors of the Corporation,
computed from the date on which such dividends began to accrue on such shares to
the date to which dividends are stated to accrue, less the aggregate amount of
dividends previously paid thereon.
(b) "Designated LIBOR Page" means the display on the Dow Jones
Telerate Service for the purpose of displaying the London interbank rates of
major banks for U.S. dollars.
(c) "LIBOR" means the rate for three-month deposits in U.S.
dollars that appears on the Designated LIBOR Page as of 11:00 A.M., London time,
on a particular date. If no such rate appears, LIBOR with respect to such date
will be determined as follows: (i) the Bank will request the principal London
offices of each of four major reference banks in the London interbank market, as
selected by the Bank, to provide the Bank with its offered quotation for
three-month deposits in U.S. dollars to prime banks in the London interbank
market at approximately 11:00 A.M., London time, on such date, and in a
principal amount of not less than U.S. $1,000,000, that is representative of a
single transaction in such market at such time; (ii) if at least two such
quotations are provided, LIBOR with respect to such date will be the arithmetic
mean of such quotations; (iii) if fewer than two quotations are provided, LIBOR
with respect to such date will be the arithmetic mean of the rates quoted at
approximately 11:00 A.M., New York City time, on such date, by three major banks
in New York City selected by the Bank for three-month loans in U.S. dollars to
leading European banks, and in a principal amount of not less than U.S.
$1,000,000, that is representative of a single transaction in U.S. dollars in
such market at such time; provided, however, that if the banks so selected by
the Bank are not quoting as mentioned in this sentence, LIBOR for such date will
be the same as LIBOR for the immediately preceding Dividend Payment Period.
(d) "London Banking Day" means a day on which dealings in
deposits in U.S. dollars are transacted in the London interbank market.
4.4.2 DIVIDENDS.
(a) The dividend rate for the Class B Preferred Shares shall be
a variable rate, to be determined quarterly for each calendar quarter during
which any Class B Preferred Shares are outstanding, equal to LIBOR, determined
as of the first day of each such quarter or, if the first day of such quarter is
not a London Banking Day, then on the first London Banking Day of such quarter.
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(b) The Board of Directors may declare dividends on the Class B
Preferred Shares quarterly, and may set apart funds for the payment of such
dividends at the time of such declaration. Any such dividends, when, as, and if
declared by the Board of Directors, shall be payable annually on such date as
may be fixed by the Board of Directors to holders of such shares of record on
the record date fixed for such purpose by the Board of Directors in advance of
the payment of such dividend. Any dividends on the Class B Preferred Shares
shall be payable only out of funds legally available for the payment thereof.
(c) Dividends on the Class B Preferred Shares shall not be
cumulative; however, so long as any Class B Preferred Shares remain outstanding,
no dividend, except a dividend payable in common shares, shall be declared or
paid upon, nor shall any distribution be made or ordered except as aforesaid, in
respect of the common shares, nor shall any moneys be set aside for or applied
to the purchase or redemption (through a sinking fund or otherwise) of common
shares, in a particular calendar year, unless the full dividend on all
outstanding Class B Preferred Shares for all calendar quarters within such year
that have ended prior to the taking of any such action with respect to the
common shares shall have been paid or declared and set apart for payment.
4.4.3 LIQUIDATION PREFERENCE. The amount payable on the outstanding
Class B Preferred Shares in the event of any voluntary or involuntary
liquidation, dissolution, or winding-up of affairs of the Corporation shall be
$1,000 per share, plus the amount of any Accrued Dividends to the date fixed for
payment of distributable amounts on such shares. Upon any such liquidation,
dissolution, or winding-up of the Corporation, the holders of Class B Preferred
Shares shall be entitled, before any distribution shall be made to the holders
of shares of common stock, to be paid the full preferential amount of $1,000 per
share, but the holders of Class B Preferred Shares shall not be entitled to any
further payment with respect to such shares.
4.4.4 VOTING RIGHTS. The Class B Preferred Shares shall be non-voting,
except as otherwise required by law.
4.4.5 REDEMPTION.
(a) The Class B Preferred Shares shall be redeemable by the
Corporation at any time at $1,000 per share, plus the full dividend on all
outstanding Class B Preferred Shares for the then current dividend period to the
redemption date on shares redeemed (the "Redemption Price") with funds legally
available for such purpose. The Corporation, at the option of the Board of
Directors, may at any time redeem the whole, or from time to time may redeem any
part, of the Class B Preferred Shares at such time or times by paying the
Redemption Price, in cash, to the holders thereof; provided, however, that less
than all of the Class B Preferred Shares may be redeemed only after or
concurrently with making payment of, or declaring or setting apart for payment,
the full dividend on all outstanding Class B Preferred Shares for the then
current dividend period. If less than all of the outstanding Class B Preferred
Shares are to be called for redemption, the shares to be redeemed shall be
selected either by lot or pro rata, at the option of the Board of Directors, and
in such manner as may be prescribed by resolution of the Board of Directors.
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(b) Not more than 60 days and not less than 10 days prior to
the date established for such redemption (the "Redemption Date"), notice of the
proposed redemption shall be mailed to the holders of record of the Class B
Preferred Shares to be redeemed, such notice to be addressed to each such
shareholder at his last known address shown on the records of the Corporation,
and the time of mailing such notice shall be deemed to be the time of the giving
thereof. On or after the Redemption Date, each holder of Class B Preferred
Shares called for redemption shall surrender his certificate(s) for such shares
to the Corporation at the place designated in such notice and shall thereupon be
entitled to receive payment of the Redemption Price. In case less than all the
shares represented by any such surrendered certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares. If such notice
of redemption shall have been given as aforesaid, and if on or before the
Redemption Date the funds necessary for the redemption shall have been set aside
so as to be and continue available therefor, then, notwithstanding that the
certificates representing any Class B Preferred Shares so called for redemption
shall not have been surrendered, the dividends thereon shall cease to accrue
after the Redemption Date and all rights with respect to the shares so called
for redemption shall forthwith after such Redemption Date cease, except only the
right of the holders to receive the Redemption Price, without interest. If such
notice of redemption of all or any part of the Class B Preferred Shares shall
have been mailed as aforesaid and the Corporation shall thereafter deposit money
for the payment of the Redemption Price pursuant thereto with any bank or trust
company (hereinafter referred to as the "depository"), including any Affiliate
of the Corporation, selected by the Board of Directors for that purpose, to be
applied to such redemption, then from and after the making of such deposit, such
shares shall not be deemed to be outstanding for any purpose, and the rights of
the holders thereof shall be limited to the rights to receive payment of the
Redemption Price, without interest but including Accrued Dividends to the
Redemption Date, from the depository upon endorsement, if required, and
surrender of the certificates therefor. The Corporation shall be entitled to
receive, from time to time, from the depository, the interest, if any, allowed
on such moneys deposited with it, and the holders of any shares so redeemed
shall have no claim to any such interest. Any moneys so deposited and remaining
unclaimed at the end of three years from the Redemption Date shall, if
thereafter requested by resolution of the Board of Directors, be repaid to the
Corporation, and in the event of such repayment to the Corporation, such holders
of record of the shares so called for redemption as shall not have made claim
against such moneys prior to such repayment to the Corporation shall be deemed
to be unsecured creditors of the Corporation for an amount equivalent to the
amount deposited as above stated for the redemption of such shares and so repaid
to the Corporation, but shall in no event be entitled to any interest.
(c) Subject to the provisions hereof, the Board of Directors
shall have authority to prescribe from time to time the manner in which Class B
Preferred Shares shall be redeemed. All Class B Preferred Shares redeemed at the
option of the Corporation shall be permanently retired in the manner provided by
law.
(d) Nothing herein contained shall limit any legal right of the
Corporation to purchase any shares of the Class B Preferred Shares; provided,
however, that, except in accordance with an offer made to all holders of Class B
Preferred Shares, the Corporation shall not purchase or otherwise acquire for a
consideration, or permit any Affiliate to purchase or otherwise acquire for a
consideration, any Class B Preferred Shares unless the full dividend on
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all outstanding Class B Preferred Shares for the then current dividend period
shall have been paid or declared and set apart for payment.
4.5 CLASS C PREFERRED SHARES.
4.5.1 DEFINITIONS. As used herein in reference to the Class C Preferred
Shares, all terms defined in Section 4.4.1 hereof shall have the meanings
specified in such Section, substituting "Class C Preferred Shares" for "Class B
Preferred Shares" and changing all Section references as appropriate, except as
follows:
(a) "Administrative Action" means any judicial decision,
official administrative pronouncement, published or private ruling, technical
advice memorandum, Chief Counsel Advice (as defined in the Code), regulatory
procedure, notice, or announcement (including any notice or announcement or
intent to adopt such procedures or regulations).
(b) "Bank Class C Preferred Shares" means shares of the
nonvoting Class C Preferred stock of the Bank, $25.00 par value per share.
(c) "Conditional Exchange" means an exchange of all of the
Class C Preferred Shares for Bank Class C Preferred Shares, on a one share for
one share basis, in accordance with the terms, conditions, and procedures
specified in Section 4.5.6 hereof.
(d) "Directive" means a directive issued by the OCC
requiring the Conditional Exchange of all of the Class C Preferred Shares.
(e) "Dividend Payment Date" means March 31, June 30, September
30, and December 31 of each year, with respect to dividends payable for the
Dividend Periods ending on such dates, provided that, if any March 31, June 30,
or September 30 is not a Business Day, then the Dividend Payment Date for the
Dividend Payment Period ending on such date shall be the next Business Day
following such date, and if any December 31 is not a Business Day, then the
Dividend Payment Date for the Dividend Payment Period ending on such date shall
be the Business Day next preceding December 31.
(f) "Dividend Period" (other than the Initial Dividend Period)
means the quarterly period commencing on and including the first day, and ending
on and including the last day, of each calendar quarter.
(g) "Effective Time of Exchange" means 8:00 A.M. Eastern Time
on the effective date of a Conditional Exchange, as set forth in a Directive,
or, if such date is not set forth in a Directive, as of 8:00 A.M. Eastern Time
on the first Business Day immediately following the date of the issuance of the
Directive.
(h) "Exchange Event" means the issuance by the OCC, at any
time following the occurrence of a Supervisory Event, of a Directive.
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(i) "FFO" means funds from operations of the Corporation and is
equal to net income of the Corporation, calculated according to generally
accepted accounting principles in the United States, plus depreciation of real
or personal property used to generate income, less any gain on the sale of real
estate plus any loss on the sale of real estate.
(j) "Independent Directors" is defined in Section 8.1 hereof.
(k) "Initial Dividend Period" means the first Dividend Period
following the issuance of any Class C Shares, which shall commence on and
include the first day upon which a share of Class C Preferred Shares shall be
issued and shall end on and include the last day of the calendar quarter in
which such issuance occurs.
(l) "Investment Company Act" means the Investment Company Act
of 1940, as amended.
(m) "Investment Company Act Event" means the receipt by the
Corporation of an opinion of counsel, rendered by a law firm experienced in such
matters, to the effect that there is a significant risk that the Corporation is
or will be considered an "investment company" that is required to be registered
under the Investment Company Act, as a result of the occurrence of a change in
law or regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency, or regulatory
authority.
(n) "Junior Stock" means the common shares, the Class B
Preferred Shares, and any and all other classes and series of equity securities
of the Corporation now or hereafter authorized, issued, or outstanding, except
Parity Stock and Senior Stock, if any.
(o) "Liquidation Value" means $25.00 per share, plus the amount
of any Accrued Dividends to the date fixed for payment of distributable amounts
on such shares, without interest.
(p) "OCC" means the Office of the Comptroller of the Currency.
(q) "Optional Redemption Date" means [____________], 2021.
(r) "Parity Stock" means the Class A and Class D Preferred
Shares.
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(s) "Preferred Director" means either of the two directors
elected by holders of the Class C Preferred Shares and holders of other Parity
Stock in accordance with Section 4.5.4(b) hereof.
(t) "Rating Agencies" means Moody's Investor Services and
Standard & Poor's.
(u) "Record Date" means the record dates, not more than 45
calendar days nor less than 10 calendar days preceding a Dividend Payment Date
therefor, as determined by the Board of Directors.
(v) "Regulatory Capital Event" means a determination by the
Corporation, based on an opinion of counsel rendered by a law firm experienced
in such matters, that there is a significant risk that the Class C Preferred
Shares will no longer constitute Tier 1 capital of the Bank (other than as a
result of limitations on the portion of Tier 1 capital that may consist of
minority interests in subsidiaries of the Bank) for purposes of the capital
adequacy guidelines or policies of the OCC, or its successor as the Bank's
primary federal banking regulator, as a result of: (i) any amendments to,
clarification of, or change in applicable laws or related regulations or
official interpretations or policies, or (ii) any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations.
(w) "Senior Stock" means any and all classes or series of
equity securities of the Corporation expressly designated as ranking senior to
the Class C Preferred Shares as to dividend rights or rights upon the
liquidation of the Corporation.
(x) "Special Event" means an Investment Company Event, a
Regulatory Capital Event, or a Tax Event.
(y) "Supervisory Event" means the occurrence of any of the
following events: (i) the Bank becomes "undercapitalized" under prompt
corrective action regulations (12 C.F.R. ss.6.4(b)), (ii) the Bank is placed
into conservatorship or receivership, or (iii) the OCC, in its sole discretion,
anticipates the Bank becoming "undercapitalized" in the near term.
(z) "Tax Event" means the receipt by the Corporation of an
opinion of a law firm experienced in such matters, in form and substance
satisfactory to the Corporation, to the effect that there is a significant risk
that (i) dividends paid or to be paid by the Corporation with respect to the
Capital Stock of the Corporation are not, or will not be, fully deductible by
the Corporation for United States federal income tax purposes, or (ii) the
Corporation is, or will be, subject to additional taxes, duties, or other
governmental charges in an amount which the Corporation reasonably determines to
be significant, as a result of (A) any amendment to, clarification of, or change
(including any announced prospective change) in, the laws, treaties, or any
regulations thereunder of the United States or any political subdivision or
taxing authority thereof or therein affecting taxation, or (B) an Administrative
Action, which amendment, clarification, or change is effective, or
Administrative Action is announced, on or after the date of issuance of any of
the Class C Preferred Shares or Class D Shares.
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4.5.2 DIVIDENDS.
(a) PAYMENT OF DIVIDENDS. Holders of Class C Preferred Shares
shall be entitled to receive, if, as, and when authorized and declared by the
Board of Directors, out of assets of the Corporation legally available therefor,
noncumulative cash dividends at an annual rate of [_____]% of the Liquidation
Value, and no more. Such noncumulative cash dividends shall be payable, if and
when authorized and declared, quarterly in arrears on a Dividend Payment Date.
Each authorized and declared dividend shall be payable to holders of record of
the Class C Preferred Shares as they appear on the stock books of the
Corporation at the close of business on a Record Date; provided, however, that
if a redemption date for the Class C Preferred Shares occurs after a dividend is
authorized and declared but before it is paid, such dividend shall be paid as
part of the redemption price to the person to whom the redemption price is paid.
(b) PRORATION OF DIVIDENDS. The amount of dividends payable for
the Initial Dividend Period and for any other Dividend Period which, as to a
share of Class C Preferred Shares (determined by reference to the issuance date
and the redemption or retirement date thereof), is greater or less than a full
Dividend Period shall be computed on the basis of the number of days elapsed in
the period using a 360-day year composed of twelve 30-day months; provided,
however, that in the event of the Conditional Exchange, any accrued and unpaid
dividends on the Class C Preferred Shares as of the Effective Time of Exchange
shall be deemed to be accrued and unpaid dividends on the Bank Class C Preferred
Shares.
(c) NO INTEREST. Holders of Class C Preferred Shares shall not
be entitled to any interest, or any sum of money in lieu of interest, in respect
of any dividend payment or payments on the Class C Preferred Shares authorized
and declared by the Board of Directors which may be unpaid. Any dividend payment
made on the Class C Preferred Shares shall first be credited against the
earliest authorized and declared but unpaid cash dividend with respect to the
Class C Preferred Shares.
(d) DIVIDENDS NOT CUMULATIVE. The right of holders of Class C
Preferred Shares to receive dividends is noncumulative. Accordingly, if the
Board of Directors does not authorize or declare a dividend payable in respect
of any Dividend Period, holders of Class C Preferred Shares shall have no right
to receive a dividend in respect of such Dividend Period, and the Corporation
shall have no obligation to pay a dividend in respect of such Dividend Period,
whether or not dividends are authorized and declared and payable in respect of
any future Dividend Period.
(e) PRIORITY AS TO DIVIDENDS. No full dividends or other
distributions shall be authorized, declared, or paid or set apart for payment on
any Parity Stock or Junior Stock (other than in common shares or other Junior
Stock) for any Dividend Period unless full dividends have been or
contemporaneously are authorized, declared, and paid, or authorized and declared
and a sum sufficient for the payment thereof set apart for such payment, on the
Class C Preferred Shares for such Dividend Period. When dividends are not paid
in full (or a sum sufficient for such full payment is not so set apart) for any
Dividend Period on the Class C Preferred Shares
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and any Parity Stock, dividends authorized and declared on the Class C Preferred
Shares and Parity Stock shall only be authorized and declared pro rata based
upon the respective amounts that would have been paid on the Class C Preferred
Shares and such Parity Stock had dividends been authorized and declared in full.
In addition to the foregoing restriction, the Corporation shall not authorize,
declare, pay, or set apart funds for any dividends or other distributions (other
than in common shares or other Junior Stock) with respect to any common shares
or other Junior Stock of the Corporation or repurchase, redeem, or otherwise
acquire, or set apart funds for repurchase, redemption, or other acquisition of,
any common shares or other Junior Stock through a sinking fund or otherwise,
unless and until (i) the Corporation shall have authorized, declared, and paid
full dividends on the Class C Preferred Shares for the four most recent
preceding Dividend Periods (or such lesser number of Dividend Periods during
which Class C Preferred Shares have been outstanding) or sufficient funds have
been paid over to the dividend disbursing agent of the Corporation for payment
of such dividends, and (ii) the Corporation has authorized and declared a full
dividend on the Class C Preferred Shares for the then-current Dividend Period,
and sufficient funds have been paid over to the dividend disbursing agent for
the Corporation for the payment of such dividend for such then-current Dividend
Period.
(f) PRIORITY OF SENIOR STOCK. No dividend shall be paid or set
aside for holders of Class C Preferred Shares for any Dividend Period unless
full dividends have been paid or set aside for the holders of Senior Stock, if
any, as to dividends for such Dividend Period.
(g) DISTRIBUTIONS ON LIQUIDATION. Any reference to "dividends"
or "distributions" in this Section 4.5.2 shall not be deemed to include any
distribution made in connection with any voluntary or involuntary dissolution,
liquidation, or winding up of the Corporation.
4.5.3 LIQUIDATION PREFERENCE. The amount payable on the
outstanding Class C Preferred Shares in the event of any voluntary or
involuntary liquidation, dissolution, or winding-up of affairs of the
Corporation, out of the assets of the Corporation legally available for
distribution to shareholders under applicable law, or the proceeds thereof,
shall be equal to the Liquidation Value. Upon any such liquidation, dissolution,
or winding-up of the Corporation, the holders of Class C Preferred Shares shall
be entitled, before any distribution shall be made to the holders of common
shares or any other Junior Stock, to be paid the full amount of the Liquidation
Value, but the holders of Class C Preferred Shares shall not be entitled to any
further payment with respect to such shares. If the amounts available for
distribution in respect of the Class C Preferred Shares and any outstanding
Parity Stock upon any such voluntary or involuntary liquidation, dissolution, or
winding up are not sufficient to satisfy the full liquidation rights of all of
the outstanding Class C Preferred Shares and such Parity Stock, then the holders
of such outstanding shares shall share ratably in any such distribution of
assets in proportion to the full respective preferential amounts to which they
are entitled. All distributions made in respect of Class C Preferred Shares in
connection with such a liquidation, dissolution, or winding up of the
Corporation shall be made pro rata to the holders entitled thereto. Neither the
consolidation, merger, or other business combination of the Corporation with or
into any other person, nor the sale of all or substantially all of the assets of
the Corporation, shall be deemed to be a liquidation, dissolution or winding up
of the Corporation for purposes of this Section 4.5.3.
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4.5.4 VOTING RIGHTS.
(a) GENERAL. In addition to the special voting rights specified
in Sections 4.5.4(b) and (c) hereof, the holders of the Class C Preferred Shares
shall be entitled to 1/10th of one vote per share on all matters submitted to a
vote of the holders of the common shares, voting as a single class with the
holders of the common shares and the holders of any other class of shares
entitled to vote as a single class with the holders of the common shares.
(b) RIGHT TO ELECT ADDITIONAL DIRECTORS UNDER CERTAIN
CIRCUMSTANCES. If full dividends on the Class C Preferred Shares shall not have
been paid for six Dividend Periods, the number of directors of the Corporation
shall thereupon be increased by two and, subject to compliance with any
requirement for regulatory approval of (or non-objection to) persons serving as
directors, the holders of Class C Preferred Shares, voting together as a single
class with the holders of any shares of Parity Stock upon which the same voting
rights as those of the Class C Preferred Shares under this Section (b) have been
conferred, shall have the exclusive right to elect the two Preferred Directors
at the Corporation's next annual meeting of shareholders and at each subsequent
annual meeting until full dividends have been authorized, declared, and paid or
authorized and declared and a sum sufficient for payment thereof is set apart
for payment for four consecutive Dividend Periods. The term of each such
Preferred Director elected thereby shall terminate, and the total number of
directors shall be decreased by two, upon the first annual meeting of
stockholders after the payment or the authorization, declaration, and setting
aside for payment of full dividends on the Class C Preferred Shares and any
Parity Stock, as applicable, for four consecutive Dividend Periods. Any
Preferred Director may be removed by, and shall not be removed except by, the
vote of the holders of record of the outstanding Class C Preferred Shares and
Parity Stock entitled to vote, voting together as a single class, at a meeting
of the Corporation's stockholders. As long as dividends on the Class C Preferred
Shares and such Parity Stock, as applicable, shall not have been paid for six
Dividend Periods, (i) any vacancy in the office of a Preferred Director may be
filled (except as provided in the following clause (ii)) by an instrument in
writing signed by the remaining Preferred Director and filed with the
Corporation, and (ii) in the case of the removal of any Preferred Director, the
vacancy may be filled by the vote of the holders of the outstanding Class C
Preferred Shares and Parity Stock entitled to vote, voting together as a single
class, at the same meeting at which such removal shall be voted. Each director
appointed as aforesaid by the remaining Preferred Director shall be deemed, for
all purposes hereof, to be a Preferred Director. Each Preferred Director shall
be deemed to be an "Independent Director" for purposes of approving actions
requiring the approval of a majority of the Independent Directors pursuant to
Article VIII hereof.
(c) OTHER VOTING RIGHTS. So long as any Class C Preferred Shares
are outstanding, the Corporation shall not, without the consent or vote of the
holders of at least two-thirds of the outstanding Class C Preferred Shares,
voting separately as a class:
(i) amend, alter, or repeal or otherwise change any
provision of these Articles of Incorporation if such amendment,
alteration, repeal, or change would materially and adversely affect the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends or other distributions, qualifications, or
terms or conditions of redemption of the Class C Preferred Shares;
provided, however, that the
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creation or issuance of Junior Stock or Parity Stock, or an amendment
that increases the authorized number of any class of Preferred Shares
or any Junior Stock or Parity Stock, shall not be deemed to be a
material and adverse change requiring a vote of the holders of Class C
Preferred Shares pursuant to this Section 4.5.4(c);
(ii) effect a consolidation, conversion, or merger of the
Company with or into, or a share exchange with, another entity except
that the Company may consolidate or merge with or into, or enter into a
share exchange with, another entity if: (A) such entity is an Affiliate
of the Bank; (B) such entity is a corporation, business trust, or other
entity organized under the laws of the United States or a political
subdivision of the United States that is not regulated as an investment
company under the Investment Company Act and that, according to an
opinion of counsel rendered by a firm experienced in such matters, is
qualified as a REIT for United States federal income tax purposes; (C)
such other entity expressly assumes all of the Company's obligations
and commitments pursuant to such consolidation, merger, or share
exchange; (D) the outstanding Class C Preferred Shares are exchanged
for or converted into shares of the surviving entity having
preferences, limitations, and relative voting and other rights
substantially identical to those of the Class C Preferred Shares,
including limitations on personal liability of the holders; (E) after
giving effect to such merger, consolidation, or share exchange, no
breach, or event which, with the giving of notice or passage of time or
both, could become a breach, by the Company of its obligations under
its Articles of Incorporation shall have occurred and be continuing;
and (F) the Company shall have received written notice from each of the
Rating Agencies and delivered a copy of such written notice to the
transfer agent of the Company confirming that such merger,
consolidation, or share exchange will not result in a reduction of the
rating assigned by any of such Rating Agencies to the Class C Preferred
Shares (or the preferred interests of the surviving corporation, trust,
or entity issued in replacement of the Class C Preferred Shares);
(iii) authorize, create, or increase the authorized amount
of or issue any class or series of any equity securities of the
Corporation that would constitute Senior Stock as to the Class C
Preferred Shares, or any warrants, options, or other rights exercisable
or convertible or exchangeable into any class or series of any equity
securities of the Corporation that would constitute Senior Stock as to
the Class C Preferred Shares;
(iv) merge, consolidate, reorganize, or effect any other
business combination involving the Corporation, unless the resulting
corporation will thereafter have no class or series of equity
securities either authorized or outstanding that would constitute
Senior Stock to the Class C Preferred Shares, except the same number of
shares of such equity securities with the same preferences, conversion
or other rights, voting powers, restrictions, limitations as to
dividends or other distributions, qualifications, or terms or
conditions of redemption, as the shares of Senior Stock of the
Corporation that are authorized and outstanding immediately prior to
such transaction, and each holder of Class C Preferred Shares
immediately prior to such transaction shall receive shares with the
same preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends or other distributions,
qualifications, or terms or
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conditions of redemption of the resulting corporation as the Class C
Preferred Shares held by such holder immediately prior thereto;
(v) make or permit to be made any payment to the Bank or
its Affiliates relating to any Indebtedness of the Corporation or
beneficial interests in the Corporation when the Corporation is
precluded, as described under Section 4.5.2(e) hereof, from paying
dividends or making distributions in respect of the common shares of
the Corporation, or make such payment or permit such payment to be made
in anticipation of any liquidation, dissolution, or winding up of the
Corporation;
(vi) incur any Indebtedness other than Permitted
Indebtedness;
(vii) pay any dividends or make any other distributions on
the common shares of the Corporation, except in additional common
shares or other Junior Stock, unless FFO for the four prior fiscal
quarters equals or exceeds 150% of the amount that would be required to
pay full annual dividends on the Class C Preferred Shares as well as
any other Parity Stock, except as may be necessary to maintain the
Corporation's status as a REIT or its exemption under the Investment
Company Act;
(viii) make any payment of interest or principal with
respect to any Indebtedness to the Bank or its Affiliates unless FFO
for the four prior fiscal quarters equals or exceeds 150% of the amount
that would be required to pay full annual dividends on the Class C
Preferred Shares as well as any other Parity Stock;
(ix) amend or otherwise change the Corporation's current
policy on reinvesting the proceeds of its assets in other
interest-earning assets such that FFO over any period of four fiscal
quarters will be anticipated to equal or exceed 150% of the amount that
would be required to pay full annual dividends on the Class C Preferred
Shares as well as any other Parity Stock, except as may be necessary to
maintain the Corporation's status as a REIT or its exemption under the
Investment Company Act; or
(x) issue a sufficient number of additional common
shares of the Corporation to Persons other than the Bank or its
Affiliates such that the Bank and its Affiliates would own less than
100% of the outstanding common shares of the Corporation.
4.5.5 REDEMPTION.
(a) NO MANDATORY REDEMPTION; OPTIONAL REDEMPTION. The Class C
Preferred Shares are not subject to mandatory redemption and, except as
hereinafter provided in Section 4.5.5(c) hereof, are not subject to optional
redemption by the Corporation prior to the Optional Redemption Date. On or after
the Optional Redemption Date, subject to receipt of prior approval of the OCC,
the Class C Preferred Shares may be redeemed in cash by the Corporation or any
successor or acquiring or resulting entity at its option, in whole or in part,
at any time or from time to time, upon notice as provided in Section 4.5.5(d),
at the redemption price of $25.00 per share, plus Accrued Dividends to the date
fixed for redemption, without interest.
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(b) REDEMPTION UPON THE OCCURRENCE OF A SPECIAL EVENT. The
Corporation will have the right, at any time (whether before or after the
Optional Redemption Date) upon the occurrence of a Special Event, to redeem the
Class C Preferred Shares, in whole, but not in part, upon notice as provided in
Section 4.5.5(d) hereof, at a redemption price of $25.00 per share, plus all
Accrued Dividends for the then-current Dividend Period to the date fixed for
redemption, without interest.
(c) PROCEDURES ON REDEMPTION. If less than all of the outstanding
Class C Preferred Shares are to be redeemed, the Corporation will select those
shares to be redeemed pro rata, by lot or by such other methods as the Board of
Directors in its sole discretion determines to be equitable, provided that such
method satisfies any applicable requirements of any securities exchange or
quotation system on which the Class C Preferred Shares are then listed or
quoted. If redemption is being effected by the Corporation, on and after the
date fixed for redemption, dividends shall cease to accrue on the Class C
Preferred Shares called for redemption, and they shall be deemed to cease to be
outstanding, provided that the redemption price (including any Accrued Dividends
to the date fixed for redemption, without interest) has been duly paid or
provided for. If redemption is being effected by an entity other than the
Corporation, on and as of the date fixed for redemption, such entity shall be
deemed to own the Class C Preferred Shares being redeemed for all purposes of
these Articles of Incorporation, provided that the redemption price (including
the amount of any Accrued Dividends to the date fixed for redemption, without
interest) has been duly paid or provided for.
(d) NOTICE OF OPTIONAL REDEMPTION. Notice of any optional
redemption, setting forth (i) the date and place fixed for said redemption, (ii)
the redemption price, and (iii) a statement that dividends on the Class C
Preferred Shares (A) to be redeemed by the Corporation will cease to accrue on
such redemption date, or (B) to be redeemed by an entity other than the
Corporation will thereafter accrue solely for the benefit of such entity, shall
be mailed at least 30 days, but not more than 60 days, prior to said date fixed
for redemption to each holder of record of Class C Preferred Shares to be
redeemed at his or her address as the same shall appear on the stock ledger of
the Corporation. If less than all of the Class C Preferred Shares owned by such
holder are then to be redeemed, such notice shall specify the number of shares
thereof that are to be redeemed and the numbers of the certificates representing
such shares. Notice of any redemption shall be given by first class mail,
postage prepaid. Neither failure to mail such notice, nor any defect therein or
in the mailing thereof, to any particular holder shall affect the sufficiency of
the notice or the validity of the proceedings for redemption with respect to the
other holders. Any notice which was mailed in the manner herein provided shall
be conclusively presumed to have been duly given whether or not the holder
receives such notice.
(e) STATUS OF REDEEMED SHARES. If such notice of redemption
shall have been so mailed, and if, on or before the date fixed for redemption
specified in such notice, all funds necessary for such redemption shall have
been set aside by the Corporation (or other entity as provided in subsection (a)
or (c) of this Section 4.5.5 separate and apart from its other funds in trust
for the account of the holders of Class C Preferred Shares to be redeemed (so as
to be and continue to be available therefor) or delivered to the redemption
agent with irrevocable instructions to effect the redemption in accordance with
the relevant notice of redemption, then,
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on and after said redemption date, notwithstanding that any certificate for
Class C Preferred Shares so called for redemption shall not have been
surrendered for cancellation or transfer, the Class C Preferred Shares (i) so
called for redemption by the Corporation shall be deemed to be no longer
outstanding and all rights with respect to such Class C Preferred Shares so
called for redemption shall forthwith cease and terminate, or (ii) so called for
redemption by an entity other than the Corporation shall be deemed owned for all
purposes of these Articles of Incorporation by such entity, except in each case
for the right of the holders thereof to receive, out of the funds so set aside
in trust, the amount payable on redemption thereof, but without interest, upon
surrender (and endorsement or assignment for transfer, if required by the
Corporation or such other entity) of their certificates. Class C Preferred
Shares redeemed pursuant to this Section 4.5.5, or purchased or otherwise
acquired for value by the Corporation shall, after such acquisition, have the
status of authorized and unissued Preferred Shares and may be reissued by the
Corporation at any time as shares of any series of Preferred Stock other than as
Class C Preferred Shares.
(f) UNCLAIMED FUNDS. In the event that holders of Class C
Preferred Shares that shall have been redeemed shall not within two (2) years
(or any longer period if required by law) after the redemption date claim any
amount deposited in trust with a bank or trust company for the redemption of
such shares, such bank or trust company shall, upon demand and if permitted by
applicable law, pay over to the Corporation (or other entity that redeemed the
shares) any such unclaimed amount so deposited with it, and shall thereupon be
relieved of all responsibility in respect thereof, and thereafter the holders of
such shares shall, subject to applicable escheat laws, look only to the
Corporation (or other entity that redeemed the shares) for payment of the
redemption price thereof, but without interest from the date fixed for
redemption.
4.5.6 CONDITIONAL EXCHANGE.
(a) EXCHANGE EVENT. Upon the occurrence of an Exchange Event,
then, subject to the terms and conditions of this Section 4.5.6, each Class C
Preferred Share will be exchanged for one newly issued Bank Class C Preferred
Share. The issuance of the Bank Class C Preferred Shares has been duly
authorized by the Board of Directors of the Bank. The preferences, conversion or
other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of the Bank Class C Preferred Shares
shall be as set forth in the Amended and Restated Articles of Association of the
Bank, which have been filed with the OCC. All corporate action necessary for the
Bank to issue the Bank Class C Preferred Shares as of the Effective Time of
Exchange was completed prior to or concurrently with issuance of the Class C
Preferred Shares.
(b) SURRENDER OF CERTIFICATES. Upon the Exchange Event, each
holder of Class C Preferred Shares shall be unconditionally obligated to
surrender to the Bank the certificates representing each Class C Preferred Share
held by such holder, and the Bank shall be unconditionally obligated to issue to
such holder in exchange for each such Class C Preferred Share a certificate
representing one Bank Class C Preferred Share.
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(c) PROCEDURES FOR EXCHANGE. The Conditional Exchange shall
occur as of the Effective Time of the Exchange. As of the Effective Time of
Exchange, all of the Class C Preferred Shares will be deemed canceled without
any further action on the part of the Corporation or any other Person, all
rights of the holders of the Class C Preferred Shares as stockholders of the
Corporation shall cease, and such persons shall thereupon and thereafter be
deemed to be and shall be for all purposes the holders of Bank Class C Preferred
Shares. Notice of the occurrence of the Exchange Event shall be given by
first-class mail, postage prepaid, mailed within 30 days of such event, to each
holder of record of the Class C Preferred Shares, at such holder's address as
the same appears on the stock register of the Corporation. Each such notice
shall indicate the place or places where certificates for the Class C Preferred
Shares are to be surrendered by the holders thereof, and the Bank shall deliver
to each such holder certificates for Bank Class C Preferred Shares upon
surrender of certificates for the Class C Preferred Shares. Until such
replacement share certificates are delivered (or in the event such replacement
certificates are not delivered), certificates previously representing the Class
C Preferred Shares shall be deemed for all purposes to represent Bank Class C
Preferred Shares.
(d) STATUS OF REDEEMED SHARES; DIVIDENDS. Any Class C
Preferred Shares purchased or redeemed by the Corporation in accordance with
Section 4.5.5 hereof prior to the Effective Time of Exchange shall not be deemed
outstanding and shall not be subject to the Conditional Exchange. In the event
of a Conditional Exchange, any accrued and unpaid dividends on the Class C
Preferred Shares as of the Effective Time of Exchange shall be deemed to be
accrued and unpaid dividends on the Bank Class C Preferred Shares.
4.5.7 NO CONVERSION RIGHTS. The holders of Class C Preferred
Shares shall not have any rights to convert such shares into shares of any other
class or series of stock or into any other securities of, or any other interest
in, the Corporation.
4.5.8 NO SINKING FUND. No sinking fund shall be established for the
retirement or redemption of the Class C Preferred Shares.
4.5.9 NO OTHER RIGHTS. The Class C Preferred Shares shall not have
any designations, preferences, or relative, participating, optional, or other
special rights, except as set forth in the Articles of Incorporation or as
otherwise required by law.
4.5.10 COMPLIANCE WITH APPLICABLE LAW. Declaration by the Board of
Directors and payment by the Corporation of dividends to holders of the Class C
Preferred Shares and repurchase, redemption, or other acquisition by the
Corporation (or another entity as provided in Section 4.5.5 hereof) of Class C
Preferred Shares shall be subject in all respects to any and all restrictions
and limitations placed on dividends, redemptions, or other distributions by the
Corporation (or any such other entity) under (i) laws, regulations, and
regulatory conditions or limitations applicable to or regarding the Corporation
(or any such other entity) from time to time, and (ii) agreements with federal
banking authorities with respect to the Corporation (or any such other entity)
from time to time in effect.
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4.5.11 AUTHORIZATION AND ISSUANCE OF ADDITIONAL SHARES. The Class C
Preferred Shares shall be subject to the authorization and issuance of Senior
Stock, Parity Stock, and Junior Stock to the extent not expressly prohibited by
the Articles of Incorporation.
4.6 CLASS D PREFERRED SHARES.
4.6.1 DEFINITIONS. As used herein in reference to the Class D
Preferred Shares, all terms defined in Sections 4.4.1 and 4.5.1 hereof shall
have the meanings specified in such Sections, substituting "Class D Preferred
Shares" for "Class B Preferred Shares" and "Class C Preferred Shares," as
appropriate, and changing all Section references as appropriate, except as
follows:
(a) "Bank Class D Preferred Shares" means shares of the
nonvoting Class D preferred stock of the Bank, $25.00 par value per share.
(b) "Conditional Exchange" means an exchange of one Class D
Preferred Share for one Bank Class D Preferred Share in accordance with the
terms, conditions, and procedures specified in Section 4.5.6 hereof.
(c) "Optional Redemption Date" means [____________], 2006.
(d) "Parity Stock" means the Class A and Class C Preferred
Shares.
4.6.2 DIVIDENDS.
(a) DIVIDEND RATE. The annual dividend rate for the Class D
Preferred Shares shall be a variable rate, to be determined quarterly for each
calendar quarter during which any Class D Preferred Shares are outstanding,
equal to (i) LIBOR, determined as of the first day of each such quarter or, if
the first day of such quarter is not a London Banking Day, then on the first
London Banking Day during such quarter, plus (ii) [_____]%.
(b) PAYMENT OF DIVIDENDS. Holders of Class D Preferred
Shares shall be entitled to receive, if, as, and when authorized and declared by
the Board of Directors, out of assets of the Corporation legally available
therefor, noncumulative cash dividends at an annual dividend rate determined
from time to time in accordance with Section 4.6.2(a) hereof on the Liquidation
Value, and no more. Such noncumulative cash dividends shall be payable, if and
when authorized and declared, quarterly in arrears on a Dividend Payment Date.
Each authorized and declared dividend shall be payable to holders of record of
the Class D Preferred Shares as they appear on the stock books of the
Corporation at the close of business on a Record Date; provided, however, that
if a redemption date for the Class D Preferred Shares occurs after a dividend is
authorized and declared but before it is paid, such dividend shall be paid as
part of the redemption price to the person to whom the redemption price is paid.
(c) Proration Of Dividends. The amount of dividends payable
for the Initial Dividend Period and for any other Dividend Period which, as to a
share of Class D Preferred Shares (determined by reference to the issuance date
and the redemption or retirement date thereof), is greater or less than a full
Dividend Period shall be computed on the basis of the
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number of days elapsed in the period using a 360-day year composed of twelve
30-day months; provided, however, that in the event of the Conditional Exchange,
any accrued and unpaid dividends on the Class D Preferred Shares as of the
Effective Time of Exchange shall be deemed to be accrued and unpaid dividends on
the Bank Class D Preferred Shares.
(d) NO INTEREST. Holders of Class D Preferred Shares shall not
be entitled to any interest, or any sum of money in lieu of interest, in respect
of any dividend payment or payments on the Class D Preferred Shares authorized
and declared by the Board of Directors which may be unpaid. Any dividend payment
made on the Class D Preferred Shares shall first be credited against the
earliest authorized and declared but unpaid cash dividend with respect to the
Class D Preferred Shares.
(e) DIVIDENDS NOT CUMULATIVE. The right of holders of
Class D Preferred Shares to receive dividends is noncumulative. Accordingly, if
the Board of Directors does not authorize or declare a dividend payable in
respect of any Dividend Period, holders of Class D Preferred Shares shall have
no right to receive a dividend in respect of such Dividend Period, and the
Corporation shall have no obligation to pay a dividend in respect of such
Dividend Period, whether or not dividends are authorized and declared and
payable in respect of any future Dividend Period.
(f) PRIORITY AS TO DIVIDENDS. No full dividends or
other distributions shall be authorized, declared, or paid or set apart for
payment on any Parity Stock or Junior Stock (other than in common shares or
other Junior Stock) for any Dividend Period unless full dividends have been or
contemporaneously are authorized, declared, and paid, or authorized and declared
and a sum sufficient for the payment thereof set apart for such payment, on the
Class D Preferred Shares for such Dividend Period. When dividends are not paid
in full (or a sum sufficient for such full payment is not so set apart) for any
Dividend Period on the Class D Preferred Shares and any Parity Stock, dividends
authorized and declared on the Class D Preferred Shares and Parity Stock shall
only be authorized and declared pro rata based upon the respective amounts that
would have been paid on the Class D Preferred Shares and such Parity Stock had
dividends been authorized and declared in full. In addition to the foregoing
restriction, the Corporation shall not authorize, declare, pay, or set apart
funds for any dividends or other distributions (other than in common shares or
other Junior Stock) with respect to any common shares or other Junior Stock of
the Corporation or repurchase, redeem, or otherwise acquire, or set apart funds
for repurchase, redemption, or other acquisition of, any common shares or other
Junior Stock through a sinking fund or otherwise, unless and until (i) the
Corporation shall have authorized, declared, and paid full dividends on the
Class D Preferred Shares for the four most recent preceding Dividend Periods (or
such lesser number of Dividend Periods during which Class D Preferred Shares
have been outstanding) or sufficient funds have been paid over to the dividend
disbursing agent of the Corporation for payment of such dividends, and (ii) the
Corporation has authorized and declared a full dividend on the Class D Preferred
Shares for the then-current Dividend Period, and sufficient funds have been paid
over to the dividend disbursing agent for the Corporation for the payment of
such dividend for such then-current Dividend Period.
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(g) PRIORITY OF SENIOR STOCK. No dividend shall be paid
or set aside for holders of Class D Preferred Shares for any Dividend Period
unless full dividends have been paid or set aside for the holders of Senior
Stock, if any, as to dividends for such Dividend Period.
(h) DISTRIBUTIONS ON LIQUIDATION. Any reference to
"dividends" or "distributions" in this Section 4.6.2 shall not be deemed to
include any distribution made in connection with any voluntary or involuntary
dissolution, liquidation, or winding up of the Corporation.
4.6.3 LIQUIDATION PREFERENCE. The amount payable on the outstanding
Class D Preferred Shares in the event of any voluntary or involuntary
liquidation, dissolution, or winding-up of affairs of the Corporation, out of
the assets of the Corporation legally available for distribution to shareholders
under applicable law, or the proceeds thereof, shall be equal to the Liquidation
Value. Upon any such liquidation, dissolution, or winding-up of the Corporation,
the holders of Class D Preferred Shares shall be entitled, before any
distribution shall be made to the holders of common shares or any other Junior
Stock, to be paid the full amount of the Liquidation Value, but the holders of
Class D Preferred Shares shall not be entitled to any further payment with
respect to such shares. If the amounts available for distribution in respect of
the Class D Preferred Shares and any outstanding Parity Stock upon any such
voluntary or involuntary liquidation, dissolution, or winding up are not
sufficient to satisfy the full liquidation rights of all of the outstanding
Class D Preferred Shares and such Parity Stock, then the holders of such
outstanding shares shall share ratably in any such distribution of assets in
proportion to the full respective preferential amounts to which they are
entitled. All distributions made in respect of Class D Preferred Shares in
connection with such a liquidation, dissolution, or winding up of the
Corporation shall be made pro rata to the holders entitled thereto. Neither the
consolidation, merger, or other business combination of the Corporation with or
into any other person, nor the sale of all or substantially all of the assets of
the Corporation, shall be deemed to be a liquidation, dissolution or winding up
of the Corporation for purposes of this Section 4.6.3.
4.6.4 VOTING RIGHTS.
(a) GENERAL. In addition to the special voting rights
specified in Sections 4.6.4(b) and (c) hereof, the holders of the Class D
Preferred Shares shall be entitled to 1/10th of one vote per share on all
matters submitted to a vote of the holders of the common shares, voting as a
single class with the holders of the common shares and the holders of any other
class of shares entitled to vote as a single class with the holders of the
common shares.
(b) RIGHT TO ELECT ADDITIONAL DIRECTORS UNDER CERTAIN
CIRCUMSTANCES. If full dividends on the Class D Preferred Shares shall not have
been paid for six Dividend Periods, the number of directors of the Corporation
shall thereupon be increased by two and, subject to compliance with any
requirement for regulatory approval of (or non-objection to) persons serving as
directors, the holders of Class D Preferred Shares, voting together as a single
class with the holders of any shares of Parity Stock upon which the same voting
rights as those of the Class D Preferred Shares under this Section (b) have been
conferred, shall have the exclusive right to elect the two Preferred Directors
at the Corporation's next annual meeting of shareholders and at each subsequent
annual meeting until full dividends have been authorized,
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declared, and paid or authorized and declared and a sum sufficient for payment
thereof is set apart for payment for four consecutive Dividend Periods. The term
of each such Preferred Director elected thereby shall terminate, and the total
number of directors shall be decreased by two, upon the first annual meeting of
stockholders after the payment or the authorization, declaration, and setting
aside for payment of full dividends on the Class D Preferred Shares and any
Parity Stock, as applicable, for four consecutive Dividend Periods. Any
Preferred Director may be removed by, and shall not be removed except by, the
vote of the holders of record of the outstanding Class D Preferred Shares and
Parity Stock entitled to vote, voting together as a single class, at a meeting
of the Corporation's stockholders. As long as dividends on the Class D Preferred
Shares and such Parity Stock, as applicable, shall not have been paid for six
Dividend Periods, (i) any vacancy in the office of a Preferred Director may be
filled (except as provided in the following clause (ii)) by an instrument in
writing signed by the remaining Preferred Director and filed with the
Corporation, and (ii) in the case of the removal of any Preferred Director, the
vacancy may be filled by the vote of the holders of the outstanding Class D
Preferred Shares and Parity Stock entitled to vote, voting together as a single
class, at the same meeting at which such removal shall be voted. Each director
appointed as aforesaid by the remaining Preferred Director shall be deemed, for
all purposes hereof, to be a Preferred Director. Each Preferred Director shall
be deemed to be an "Independent Director" for purposes of approving actions
requiring the approval of a majority of the Independent Directors pursuant to
Article VIII hereof.
(c) OTHER VOTING RIGHTS. So long as any Class D Preferred
Shares are outstanding, the Corporation shall not, without the consent or vote
of the holders of at least two-thirds of the outstanding Class D Preferred
Shares, voting separately as a class:
(i) amend, alter, or repeal or otherwise change any
provision of these Articles of Incorporation if such amendment,
alteration, repeal, or change would materially and adversely affect the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends or other distributions, qualifications, or
terms or conditions of redemption of the Class D Preferred Shares;
provided, however, that the creation or issuance of Junior Stock or
Parity Stock, or an amendment that increases the authorized number of
any class of Preferred Shares or any Junior Stock or Parity Stock,
shall not be deemed to be a material and adverse change requiring a
vote of the holders of Class D Preferred Shares pursuant to this
Section 4.6.4(c);
(ii) effect a consolidation, conversion, or merger of the
Company with or into, or a share exchange with, another entity except
that the Company may consolidate or merge with or into, or enter into a
share exchange with, another entity if: (A) such entity is an Affiliate
of the Bank; (B) such entity is a corporation, business trust, or other
entity organized under the laws of the United States or a political
subdivision of the United States that is not regulated as an investment
company under the Investment Company Act and that, according to an
opinion of counsel rendered by a firm experienced in such matters, is
qualified as a REIT for United States federal income tax purposes; (C)
such other entity expressly assumes all of the Company's obligations
and commitments pursuant to such consolidation, merger, or share
exchange; (D) the outstanding Class D Preferred Shares are exchanged
for or converted into shares of the surviving entity having
preferences, limitations, and relative voting and other rights
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substantially identical to those of the Class D Preferred Shares,
including limitations on personal liability of the holders; (E) after
giving effect to such merger, consolidation, or share exchange, no
breach, or event which, with the giving of notice or passage of time or
both, could become a breach, by the Company of its obligations under
its Articles of Incorporation shall have occurred and be continuing;
and (F) the Company shall have received written notice from each of the
Rating Agencies and delivered a copy of such written notice to the
transfer agent of the Company confirming that such merger,
consolidation, or share exchange will not result in a reduction of the
rating assigned by any of such Rating Agencies to the Class D Preferred
Shares (or the preferred interests of the surviving corporation, trust,
or entity issued in replacement of the Class D Preferred Shares);
(iii) authorize, create, or increase the authorized amount
of or issue any class or series of any equity securities of the
Corporation that would constitute Senior Stock as to the Class D
Preferred Shares, or any warrants, options, or other rights exercisable
or convertible or exchangeable into any class or series of any equity
securities of the Corporation that would constitute Senior Stock as to
the Class D Preferred Shares;
(iv) merge, consolidate, reorganize, or effect any other
business combination involving the Corporation, unless the resulting
corporation will thereafter have no class or series of equity
securities either authorized or outstanding that would constitute
Senior Stock to the Class D Preferred Shares, except the same number of
shares of such equity securities with the same preferences, conversion
or other rights, voting powers, restrictions, limitations as to
dividends or other distributions, qualifications, or terms or
conditions of redemption, as the shares of Senior Stock of the
Corporation that are authorized and outstanding immediately prior to
such transaction, and each holder of Class D Preferred Shares
immediately prior to such transaction shall receive shares with the
same preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends or other distributions,
qualifications, or terms or conditions of redemption of the resulting
corporation as the Class D Preferred Shares held by such holder
immediately prior thereto;
(v) make or permit to be made any payment to the Bank or
its Affiliates relating to any Indebtedness of the Corporation or
beneficial interests in the Corporation when the Corporation is
precluded, as described under Section 4.6.2(e) hereof, from paying
dividends or making distributions in respect of the common shares of
the Corporation, or make such payment or permit such payment to be made
in anticipation of any liquidation, dissolution, or winding up of the
Corporation;
(vi) incur any Indebtedness other than Permitted
Indebtedness;
(vii) pay any dividends or make any other distributions on
the common shares of the Corporation, except in additional common
shares or other Junior Stock, unless FFO for the four prior fiscal
quarters equals or exceeds 150% of the amount that would be required to
pay full annual dividends on the Class D Preferred Shares as well as
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any other Parity Stock, except as may be necessary to maintain the
Corporation's status as a REIT or its exemption under the Investment
Company Act;
(viii) make any payment of interest or principal with
respect to any Indebtedness to the Bank or its Affiliates unless FFO
for the four prior fiscal quarters equals or exceeds 150% of the amount
that would be required to pay full annual dividends on the Class D
Preferred Shares as well as any other Parity Stock;
(ix) amend or otherwise change the Corporation's current
policy on reinvesting the proceeds of its assets in other
interest-earning assets such that FFO over any period of four fiscal
quarters will be anticipated to equal or exceed 150% of the amount that
would be required to pay full annual dividends on the Class D Preferred
Shares as well as any other Parity Stock, except as may be necessary to
maintain the Corporation's status as a REIT or its exemption under the
Investment Company Act; or
(x) issue a sufficient number of additional common shares
of the Corporation to Persons other than the Bank or its Affiliates
such that the Bank and its Affiliates would own less than 100% of the
outstanding common shares of the Corporation.
4.6.5 REDEMPTION.
(a) NO MANDATORY REDEMPTION; OPTIONAL REDEMPTION. The Class D
Preferred Shares are not subject to mandatory redemption and, except as
hereinafter provided in Section 4.6.5(c) hereof, are not subject to optional
redemption by the Corporation prior to the Optional Redemption Date. On or after
the Optional Redemption Date, subject to receipt of prior approval of the OCC,
the Class D Preferred Shares may be redeemed in cash by the Corporation or any
successor or acquiring or resulting entity at its option, in whole or in part,
at any time or from time to time, upon notice as provided in Section 4.6.5(d),
at the redemption price of $25.00 per share, plus Accrued Dividends to the date
fixed for redemption, without interest.
(b) REDEMPTION UPON THE OCCURRENCE OF A SPECIAL EVENT. The
Corporation will have the right, at any time (whether before or after the
Optional Redemption Date) upon the occurrence of a Special Event, to redeem the
Class D Preferred Shares, in whole, but not in part, upon notice as provided in
Section 4.6.5(d) hereof, at a redemption price of $25.00 per share, plus all
Accrued Dividends for the then-current Dividend Period to the date fixed for
redemption, without interest.
(c) PROCEDURES ON REDEMPTION. If less than all of the
outstanding Class D Preferred Shares are to be redeemed, the Corporation will
select those shares to be redeemed pro rata, by lot or by such other methods as
the Board of Directors in its sole discretion determines to be equitable,
provided that such method satisfies any applicable requirements of any
securities exchange or quotation system on which the Class D Preferred Shares
are then listed or quoted. If redemption is being effected by the Corporation,
on and after the date fixed for redemption, dividends shall cease to accrue on
the Class D Preferred Shares called for redemption, and they shall be deemed to
cease to be outstanding, provided that the redemption price (including any
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Accrued Dividends to the date fixed for redemption, without interest) has been
duly paid or provided for. If redemption is being effected by an entity other
than the Corporation, on and as of the date fixed for redemption, such entity
shall be deemed to own the Class D Preferred Shares being redeemed for all
purposes of these Articles of Incorporation, provided that the redemption price
(including the amount of any Accrued Dividends to the date fixed for redemption,
without interest) has been duly paid or provided for.
(d) NOTICE OF OPTIONAL REDEMPTION. Notice of any optional
redemption, setting forth (i) the date and place fixed for said redemption, (ii)
the redemption price, and (iii) a statement that dividends on the Class D
Preferred Shares (A) to be redeemed by the Corporation will cease to accrue on
such redemption date, or (B) to be redeemed by an entity other than the
Corporation will thereafter accrue solely for the benefit of such entity, shall
be mailed at least 30 days, but not more than 60 days, prior to said date fixed
for redemption to each holder of record of Class D Preferred Shares to be
redeemed at his or her address as the same shall appear on the stock ledger of
the Corporation. If less than all of the Class D Preferred Shares owned by such
holder are then to be redeemed, such notice shall specify the number of shares
thereof that are to be redeemed and the numbers of the certificates representing
such shares. Notice of any redemption shall be given by first class mail,
postage prepaid. Neither failure to mail such notice, nor any defect therein or
in the mailing thereof, to any particular holder shall affect the sufficiency of
the notice or the validity of the proceedings for redemption with respect to the
other holders. Any notice which was mailed in the manner herein provided shall
be conclusively presumed to have been duly given whether or not the holder
receives such notice.
(e) STATUS OF REDEEMED SHARES. If such notice of redemption shall
have been so mailed, and if, on or before the date fixed for redemption
specified in such notice, all funds necessary for such redemption shall have
been set aside by the Corporation (or other entity as provided in subsection (a)
or (c) of this Section 4.6.5) separate and apart from its other funds in trust
for the account of the holders of Class D Preferred Shares to be redeemed (so as
to be and continue to be available therefor) or delivered to the redemption
agent with irrevocable instructions to effect the redemption in accordance with
the relevant notice of redemption, then, on and after said redemption date,
notwithstanding that any certificate for Class D Preferred Shares so called for
redemption shall not have been surrendered for cancellation or transfer, the
Class D Preferred Shares (i) so called for redemption by the Corporation shall
be deemed to be no longer outstanding and all rights with respect to such Class
D Preferred Shares so called for redemption shall forthwith cease and terminate,
or (ii) so called for redemption by an entity other than the Corporation shall
be deemed owned for all purposes of these Articles of Incorporation by such
entity, except in each case for the right of the holders thereof to receive, out
of the funds so set aside in trust, the amount payable on redemption thereof,
but without interest, upon surrender (and endorsement or assignment for
transfer, if required by the Corporation or such other entity) of their
certificates. Class D Preferred Shares redeemed pursuant to this Section 4.6.5,
or purchased or otherwise acquired for value by the Corporation shall, after
such acquisition, have the status of authorized and unissued Preferred Shares
and may be reissued by the Corporation at any time as shares of any series of
Preferred Stock other than as Class D Preferred Shares.
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(f) UNCLAIMED FUNDS. In the event that holders of Class
D Preferred Shares that shall have been redeemed shall not within two (2) years
(or any longer period if required by law) after the redemption date claim any
amount deposited in trust with a bank or trust company for the redemption of
such shares, such bank or trust company shall, upon demand and if permitted by
applicable law, pay over to the Corporation (or other entity that redeemed the
shares) any such unclaimed amount so deposited with it, and shall thereupon be
relieved of all responsibility in respect thereof, and thereafter the holders of
such shares shall, subject to applicable escheat laws, look only to the
Corporation (or other entity that redeemed the shares) for payment of the
redemption price thereof, but without interest from the date fixed for
redemption.
4.6.6 CONDITIONAL EXCHANGE.
(a) EXCHANGE EVENT. Upon the occurrence of an Exchange Event,
then, subject to the terms and conditions of this Section 4.6.6, each Class D
Preferred Share will be exchanged for one newly issued Bank Class D Preferred
Share. The issuance of the Bank Class D Preferred Shares has been duly
authorized by the Board of Directors of the Bank. The preferences, conversion or
other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of the Bank Class D Preferred Shares
shall be as set forth in the Amended and Restated Articles of Association of the
Bank, which have been filed with the OCC. All corporate action necessary for the
Bank to issue the Bank Class D Preferred Shares as of the Effective Time of
Exchange was completed prior to or concurrently with issuance of the Class D
Preferred Shares.
(b) SURRENDER OF CERTIFICATES. Upon the Exchange Event, each
holder of Class D Preferred Shares shall be unconditionally obligated to
surrender to the Bank the certificates representing each Class D Preferred Share
held by such holder, and the Bank shall be unconditionally obligated to issue to
such holder in exchange for each such Class D Preferred Share a certificate
representing one Bank Class D Preferred Share.
(c) PROCEDURES FOR EXCHANGE. The Conditional Exchange shall
occur as of the Effective Time of the Exchange. As of the Effective Time of
Exchange, all of the Class D Preferred Shares will be deemed canceled without
any further action on the part of the Corporation or any other Person, all
rights of the holders of the Class D Preferred Shares as stockholders of the
Corporation shall cease, and such persons shall thereupon and thereafter be
deemed to be and shall be for all purposes the holders of Bank Class D Preferred
Shares. Notice of the occurrence of the Exchange Event shall be given by
first-class mail, postage prepaid, mailed within 30 days of such event, to each
holder of record of the Class D Preferred Shares, at such holder's address as
the same appears on the stock register of the Corporation. Each such notice
shall indicate the place or places where certificates for the Class D Preferred
Shares are to be surrendered by the holders thereof, and the Bank shall deliver
to each such holder certificates for Bank Class D Preferred Shares upon
surrender of certificates for the Class D Preferred Shares. Until such
replacement share certificates are delivered (or in the event such replacement
certificates are not delivered), certificates previously representing the Class
D Preferred Shares shall be deemed for all purposes to represent Bank Class D
Preferred Shares.
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(d) STATUS OF REDEEMED SHARES; DIVIDENDS. Any Class D
Preferred Shares purchased or redeemed by the Corporation in accordance with
Section 4.6.5 hereof prior to the Effective Time of Exchange shall not be deemed
outstanding and shall not be subject to the Conditional Exchange. In the event
of a Conditional Exchange, any accrued and unpaid dividends on the Class D
Preferred Shares as of the Effective Time of Exchange shall be deemed to be
accrued and unpaid dividends on the Bank Class D Preferred Shares.
4.6.7 NO CONVERSION RIGHTS. The holders of Class D Preferred Shares
shall not have any rights to convert such shares into shares of any other class
or series of stock or into any other securities of, or any other interest in,
the Corporation.
4.6.8 NO SINKING FUND. No sinking fund shall be established for the
retirement or redemption of the Class D Preferred Shares.
4.6.9 NO OTHER RIGHTS. The Class D Preferred Shares shall not have
any designations, preferences, or relative, participating, optional, or other
special rights, except as set forth in the Articles of Incorporation or as
otherwise required by law.
4.6.10 COMPLIANCE WITH APPLICABLE LAW. Declaration by the Board of
Directors and payment by the Corporation of dividends to holders of the Class D
Preferred Shares and repurchase, redemption, or other acquisition by the
Corporation (or another entity as provided in Section 4.6.5 hereof) of Class D
Preferred Shares shall be subject in all respects to any and all restrictions
and limitations placed on dividends, redemptions, or other distributions by the
Corporation (or any such other entity) under (i) laws, regulations, and
regulatory conditions or limitations applicable to or regarding the Corporation
(or any such other entity) from time to time, and (ii) agreements with federal
banking authorities with respect to the Corporation (or any such other entity)
from time to time in effect.
4.6.11 AUTHORIZATION AND ISSUANCE OF ADDITIONAL SHARES. The Class D
Preferred Shares shall be subject to the authorization and issuance of Senior
Stock, Parity Stock, and Junior Stock to the extent not expressly prohibited by
the Articles of Incorporation.
4.7 PREFERRED STOCK.
4.7.1 BOARD OF DIRECTORS AUTHORIZED TO ESTABLISH TERMS OF SHARES.
The Board of Directors of the Corporation is hereby expressly authorized to
adopt amendments to the Articles of Incorporation of the Corporation in respect
of any unissued or treasury shares of the Preferred Stock authorized under item
(vi) of Section 4.2 hereof, to provide for the issuance of one or more classes
of Preferred Stock and to fix or change the designation, powers, preferences,
and rights of the shares of each such class, and any qualifications,
limitations, or restrictions thereof, including, without limitation, the
following, and the shares of each such class may vary from the shares of any
other class in the following respects:
(i) the division of such shares into series and the
designation and authorized number of share of each
series;
(ii) the dividend or distribution rate;
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(iii) the dates of payment of dividends or distributions,
whether the dividends will be cumulative and, if so,
the dates from which dividends will accumulate;
(iv) liquidation rights, preferences, and prices, if any;
(v) redemption rights and prices, if any; (vi) sinking fund
requirements, if any;
(vii) conversion rights, if any;
(viii) restrictions on the issuance of shares of any class or
series; and
(ix) any other relative rights, preferences, and limitations.
4.7.2 Voting Rights. The holders of the Preferred Stock shall be
entitled to 1/10th of one vote per share on all matters submitted to a vote of
the holders of the common shares, voting as a single class with the holders of
the common shares and the holders of any other class of shares entitled to vote
as a single class with the holders of the common shares.
ARTICLE V
RESTRICTION ON TRANSFER AND OWNERSHIP OF SHARES
5.1 DEFINITIONS. As used in this Article V:
(a) "Ownership Limit" means no more than 9.2% of the aggregate
liquidation preference (i.e., without Accrued Dividends), of the issued and
outstanding Preferred Shares of the Corporation. The aggregate initial
liquidation preference of the outstanding Preferred Shares shall be determined
by the Board of Directors of the Corporation in good faith, which determination
shall be conclusive for all purposes hereof. The Board of Directors also may
determine that compliance with any restriction or limitation on stock ownership
and transfers set forth in this Article V is no longer required for REIT
qualification and, therefore, may waive compliance with such restriction or
limitation in whole or in part or that, based upon then current law, such
restriction or limitation may be modified.
(b) "Constructive Ownership" means ownership of Capital Stock
by a Person, whether the interest in the shares of Capital Stock is held
directly or indirectly (including by a nominee), and shall include interests
that would be treated as owned through the application of Section 544 of the
Code, as modified by Section 856(h)(1)(B) of the Code. The terms "Constructive
Owner," "Constructively Owns" and "Constructively Owned" shall have the
correlative meanings.
(c) "Charitable Beneficiary" means one or more beneficiaries
of the Trust, as determined pursuant to Section 5.3.3, provided that each such
organization must be described in Section 501(c)(3) of the Code and
contributions to each such organization must be eligible for deduction under
each of Sections 170(b)(1)(A), 2055, and 2522 of the Code.
(d) "Initial Date" means the date upon which the Amended and
Restated Articles of Incorporation containing this Article V are filed with the
Secretary of State of Ohio.
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(e) "Market Price" on a particular date means, with respect to
any class or series of outstanding shares of Capital Stock, the last sale price
for such Capital Stock, regular way or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way, for such
Capital Stock (the "Closing Price"), in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on the principal national securities exchange on which such
Capital Stock is listed or admitted to trading or, if such Capital Stock is not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotation System or, if such system is no
longer in use, the principal other automated quotation system that may then be
in use or, if such Capital Stock is not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in such Capital Stock selected by the Board of
Directors of the Corporation or, in the event that no trading price is available
for such Capital Stock, the fair market value of the Capital Stock, as
determined in good faith by the Board of Directors of the Corporation.
(f) "Prohibited Owner" means, with respect to any purported
Transfer, any Person who, but for the provisions of Section 5.2.1, would own or
Constructively Own Preferred Shares in violation of this Article V and, if
appropriate in the context, shall also mean any Person who would have been the
record owner of the shares that the Prohibited Owner would have so owned.
(g) "Restriction Termination Date" means the first day
after the Initial Date on which the Corporation determines pursuant to Section
7.1 that it is no longer in the best interests of the Corporation to attempt to,
or continue to, qualify as a REIT.
(h) "Transfer" means any issuance, sale, transfer, gift,
assignment, devise, or other disposition, as well as any other event that causes
any Person to acquire Constructive Ownership of any Preferred Shares or the
right to vote or receive dividends on Preferred Shares, or any agreement to take
any such actions or cause any such events, including (i) the granting or
exercise of any option (or any disposition of any option), (ii) any disposition
of any securities or rights convertible into or exchangeable for Preferred Stock
or any interest in Preferred Stock or any exercise of any such conversion or
exchange right, (iii) transfers of interests in other entities that result in
changes in Constructive Ownership of Preferred Stock, and (iv) the transfer of
any Preferred Shares pursuant to a waiver of the Ownership Limit under Section
5.2.7; in each case, whether voluntary or involuntary, whether Constructively
Owned and whether by operation of law or otherwise. The terms "Transferring" and
"Transferred" shall have the correlative meanings.
(i) "Trust" means any trust described in Section 5.3.1.
(j) "Trustee" means the Person, who shall not be an Affiliate
of the Corporation or a Prohibited Owner, who is appointed by the Corporation to
serve as trustee of the Trust.
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5.2 RESTRICTIONS ON TRANSFERS OF CAPITAL STOCK.
5.2.1 OWNERSHIP LIMITATIONS. During the period commencing on the
Initial Date and ending on the Restriction Termination Date:
(a) BASIC RESTRICTIONS.
(i) No Person other than the Bank or an Affiliate of
the Bank shall Constructively Own Preferred Shares in excess of the
Ownership Limit; and
(ii) Notwithstanding any other provisions contained
herein, any Transfer of Preferred Shares that, if effective, would
result in Preferred Shares being beneficially owned by less than 100
Persons (determined under the principles of Section 856(a)(5) of the
Code) shall be void ab initio, and the intended transferee shall
acquire no rights in such Preferred Shares.
(b) TRANSFER IN TRUST. If any proposed Transfer of Preferred
Shares, if effective, would result in any Person Constructively Owning Preferred
Shares in violation of Section 5.2.1(a)(i) hereof, then:
(i) that number of Preferred Shares the Constructive
Ownership of which otherwise would cause such Person to violate Section
5.2(a)(i) (rounded up to the nearest whole share) shall be
automatically transferred to a Trust for the benefit of a Charitable
Beneficiary, as described in Section 5.3 hereof, effective as of the
close of business on the Business Day prior to the date of such
Transfer, and such Person shall acquire no rights in such shares; or
(ii) if the transfer to the Trust described in clause
(i) above would not be effective for any reason to prevent the
violation of Section 5.2(a)(i), then the Transfer of that number of
Preferred Shares that otherwise would cause any Person to violate
Section 5.2(a)(i) shall be void ab initio, and the intended transferee
shall acquire no rights in such Preferred Shares.
5.2.2 REMEDIES FOR BREACH. If the Board of Directors of the
Corporation or any duly authorized committee thereof shall at any time determine
in good faith that a Transfer or other event has taken place that results in a
violation of Section 5.2.1(a) hereof or that a Person intends to acquire or has
attempted to acquire Constructive Ownership of any Preferred Shares in violation
of such Section 5.2.1(a) (whether or not such violation is intended), the Board
of Directors or a committee thereof shall take such action as it deems advisable
to refuse to give effect to or to prevent such Transfer or other event,
including, without limitation, causing the Corporation to redeem shares,
refusing to give effect to such Transfer on the books of the Corporation or
instituting proceedings to enjoin such Transfer or other event; provided,
however, that any Transfers or attempted Transfers or other events in violation
of Section 5.2.1(a) shall, where applicable, automatically result in the
transfer to the Trust described above and shall, where applicable, be void ab
initio, as provided above, irrespective of any action (or non-action) by the
Board of Directors or a committee thereof.
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5.2.3 NOTICE OF RESTRICTED TRANSFER. Any Person who acquires or
attempts or intends to acquire Ownership or Constructive Ownership of Preferred
Shares that will or may violate Section 5.2.1(a) or any Person who would have
owned Preferred Shares that resulted in a transfer to the Trust pursuant to the
provisions of Section 5.2.1(b) shall immediately give written notice to the
Corporation of such event, or in the case of such a proposed or attempted
transaction, give at least 15 days' prior written notice, and shall provide to
the Corporation such other information as the Corporation may request in order
to determine the effect, if any, of such Transfer on the Corporation's status as
a REIT.
5.2.4 OWNERS REQUIRED TO PROVIDE INFORMATION. During the period
commencing on the Initial Date and ending on the Restriction Termination Date:
(a) Each Person who is a Constructive Owner of more than one
percent (or such lower percentage as required by the Code or the Treasury
Regulations promulgated thereunder) of the outstanding shares of Capital Stock,
within 30 days of June 30 and December 31 of each year, shall give written
notice to the Corporation stating the name and address of such owner, the number
of shares of Capital Stock and other shares of the Capital Stock Constructively
Owned by such owner, and a description of the manner in which such shares are
held. Each such owner shall provide to the Corporation such additional
information as the Corporation may request in order to determine the effect, if
any, of such Constructive Ownership on the Corporation's status as a REIT and to
ensure compliance with the Ownership Limit.
(b) Each Person who is a Constructive Owner of any shares of
Capital Stock, and each Person (including the stockholder of record) who is
holding Capital Stock for a Constructive Owner, shall provide to the Corporation
such information as the Corporation may request from time to time, in good
faith, in order to determine the Corporation's status as a REIT and to comply
with requirements of any taxing authority or governmental authority or to
determine such compliance.
5.2.5 REMEDIES NOT LIMITED. Subject to Section 7.1, nothing
contained in this Section 5.2 shall limit the authority of the Board of
Directors of the Corporation to take such other action as it deems necessary or
advisable to protect the Corporation and the interests of its stockholders in
preserving the Corporation's status as a REIT.
5.2.6 AMBIGUITY. In the case of any ambiguity in the application
of any of the provisions of this Section 5.2, Section 5.3 hereof, or any
definition contained in Section 5.1 hereof, the Board of Directors of the
Corporation shall have the power to determine the application of the provisions
of Section 5.2 or 5.3 with respect to any situation based on the facts known to
it. In the event Section 5.2 or 5.3 requires an action by the Board of Directors
and the Articles of Incorporation fail to provide specific guidance with respect
to such action, the Board of Directors shall have the power to determine the
action to be taken so long as such action is not contrary to the provisions of
Section 5.1, 5.2, or 5.3.
5.2.7 EXCEPTIONS.
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(a) Subject to Section 5.2.7(b) hereof, the Board of Directors
of the Corporation, in its sole discretion, may exempt a Person from the
Ownership Limit and may increase an Ownership Limit for such Person if it
receives a ruling from the Internal Revenue Service, or an opinion of counsel,
in either case in form and substance satisfactory to the Board of Directors, in
its sole discretion, as it may deem necessary or advisable in order to determine
or ensure that such exemption or increase will not jeopardize the Corporation's
status as a REIT. Notwithstanding the receipt of any ruling or opinion, the
Board of Directors may impose such conditions or restrictions as it deems
appropriate in connection with granting such exemption or increase.
(b) An underwriter which participates in a public offering or
a private placement of Preferred Stock (or securities convertible into or
exchangeable for Capital Stock) may own or Constructively Own shares of Capital
Stock (or securities convertible into or exchangeable for Capital Stock) in
excess of the Ownership Limit, but only to the extent necessary to facilitate
such public offering or private placement.
5.2.8 LEGEND. Each certificate for Preferred Shares shall bear
substantially the following legend:
The shares represented by this certificate are subject to restrictions
on Constructive Ownership and Transfer for the purpose of the
Corporation's maintenance of its status as a REIT under the Code.
Subject to certain further restrictions and except as expressly
provided in the Corporation's Articles of Incorporation, (i) no Person
may Constructively Own in excess of 9.2% of the aggregate initial
liquidation preference of the issued and outstanding Preferred Shares;
and (ii) no Person may Transfer shares of the Capital Stock of the
Corporation if such Transfer would result in the Capital Stock of the
Corporation being owned (directly or beneficially) by fewer than 100
Persons. Any Person who attempts to Constructively Own shares of
Capital Stock in violation of the above limitations must immediately
notify the Corporation. If any of the restrictions on transfer or
ownership are violated, the shares of Capital Stock represented hereby
may be automatically transferred to a Trust for the benefit of one or
more Charitable Beneficiaries. In addition, upon the occurrence of
certain events, attempted Transfers in violation of the restrictions
described above may be deemed to be void ab initio. All capitalized
terms used in this legend have the meanings defined in the Articles of
Incorporation of the Corporation, as the same may be amended from time
to time, a copy of which, including the restrictions on transfer and
ownership, will be furnished to each holder of shares of Capital Stock
of the Corporation on request and without charge.
Instead of the foregoing legend, the certificate may state that the Corporation
will furnish a full statement about certain restrictions on transferability to a
stockholder on request and without charge.
5.3 TRANSFER OF PREFERRED SHARES TO TRUST.
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5.3.1 OWNERSHIP IN TRUST. Upon any attempted Transfer or other
event that would result in a transfer of Preferred Shares to a Trust, such
Preferred Shares shall be deemed to have been transferred to the Trustee as
trustee of a Trust for the exclusive benefit of one or more Charitable
Beneficiaries. Such transfer to the Trustee shall be deemed to be effective as
of the close of business on the Business Day prior to the purported Transfer or
other event that results in the transfer to the Trust. The Trustee shall be
appointed by the Corporation and shall be a Person unaffiliated with the
Corporation and any Prohibited Owner. Each Charitable Beneficiary shall be
designated by the Corporation as provided in Section 5.3.6.
5.3.2 STATUS OF SHARES HELD BY THE TRUSTEE. Preferred Shares held
by the Trustee shall be issued and outstanding Preferred Shares of the Company.
The Prohibited Owner shall have no rights in the shares held by the Trustee. The
Prohibited Owner shall not benefit economically from ownership of any shares
held in trust by the Trustee, shall have no rights to dividends and shall not
possess any rights to vote or other rights attributable to the shares held in
the Trust.
5.3.3 DIVIDEND AND VOTING RIGHTS. The Trustee shall have all
voting rights and rights to dividends or other distributions with respect to
Preferred Shares held in the Trust, which rights shall be exercised for the
exclusive benefit of the Charitable Beneficiary. Any dividend or other
distribution paid prior to the discovery by the Corporation that the Preferred
Shares have been transferred to the Trustee shall be paid by the recipient of
such dividend or distribution to the Trustee upon demand and any dividend or
other distribution authorized but unpaid shall be paid when due to the Trustee.
Any dividend or distribution so paid to the Trustee shall be held in trust for
the Charitable Beneficiary. The Prohibited Owner shall have no voting rights
with respect to shares held in the Trust and, subject to Ohio law, effective as
of the date that the Preferred Shares have been transferred to the Trustee, the
Trustee shall have the authority (at the Trustee's sole discretion) (i) to
rescind as void any vote cast by a Prohibited Owner prior to the discovery by
the Corporation that the Preferred Shares have been transferred to the Trustee,
and (ii) to recast such vote in accordance with the desires of the Trustee
acting for the benefit of the Charitable Beneficiary; provided, however, that if
the Corporation has already taken irreversible corporate action, then the
Trustee shall not have the authority to rescind and recast such vote.
Notwithstanding the provisions of this Article V, until the Corporation has
received notification that Preferred Shares have been transferred into a Trust,
the Corporation shall be entitled to rely on its share transfer and other
stockholder records for purposes of preparing lists of stockholders entitled to
vote at meetings, determining the validity and authority of proxies and
otherwise conducting votes of stockholders.
5.3.4 SALE OF SHARES BY TRUSTEE. Within 20 days of receiving
notice from the Corporation that Preferred Shares have been transferred to the
Trust, the Trustee of the Trust shall sell the shares held in the Trust to a
Person, designated by the Trustee, whose ownership of the shares will not
violate the ownership limitations set forth in this Article V. Upon such sale,
the interest of the Charitable Beneficiary in the shares sold shall terminate
and the Trustee shall distribute the net proceeds of the sale to the Prohibited
Owner and to the Charitable Beneficiary as provided in this Section 5.3.4. The
Prohibited Owner shall receive the lesser of (i) the price paid by the
Prohibited Owner for the shares or, if the Prohibited Owner did not give value
for the shares in connection with the event causing the shares to be held in the
Trust (e.g., in the case of a gift, devise, or other such transaction), the
Market Price of the shares on the day of the event
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causing the shares to be held in the Trust, and (ii) the price per share
received by the Trustee from the sale or other disposition of the shares held in
the Trust. Any net sales proceeds in excess of the amount payable to the
Prohibited Owner shall be immediately paid to the Charitable Beneficiary. If,
prior to the discovery by the Corporation that Preferred Shares have been
transferred to the Trustee, such shares are sold by a Prohibited Owner, then
such shares shall be deemed to have been sold on behalf of the Trust and, to the
extent that the Prohibited Owner received an amount for such shares that exceeds
the amount that such Prohibited Owner was entitled to receive pursuant to this
Section 5.3.4, such Prohibited Owner shall pay such excess amount to the Trustee
upon demand.
5.3.5 PURCHASE RIGHT IN STOCK TRANSFERRED TO THE TRUSTEE.
Preferred Shares transferred to the Trustee shall be deemed to have been offered
for sale to the Corporation, or its designee, at a price per share equal to the
lesser of (i) the price per share in the transaction that resulted in such
transfer to the Trust (or, in the case of a devise or gift, the Market Price at
the time of such devise or gift), and (ii) the Market Price on the date the
Corporation, or its designee, accepts such offer. The Corporation shall have the
right to accept such offer until the Trustee has sold the shares held in the
Trust pursuant to Section 5.3.4. Upon such a sale to the Corporation, the
interest of the Charitable Beneficiary in the shares sold shall terminate and
the Trustee shall distribute the net proceeds of the sale to the Prohibited
Owner.
5.3.6 DESIGNATION OF CHARITABLE BENEFICIARIES. By written notice
to the Trustee, the Corporation shall designate one or more nonprofit
organizations to be the Charitable Beneficiary or Beneficiaries of the interest
in the Trust such that (i) the shares of Capital Stock held in the Trust would
not violate the restrictions set forth in this Article V in the hands of such
Charitable Beneficiary or Beneficiaries, and (ii) each such organization must be
described in Section 501(c)(3) of the Code and contributions to each such
organization must be eligible for deduction under each of Sections 170(b)(1)(A),
2055, and 2522 of the Code.
5.4 SETTLEMENT OF TRANSACTIONS. Nothing in this Article V shall
preclude the settlement of any transaction entered into through the facilities
of any national securities exchange or automated inter-dealer quotation system.
The fact that the settlement of any transaction is so permitted shall not negate
the effect of any other provision of this Article V and any transferee in such a
transaction shall be subject to all of the provisions and limitations set forth
in this Article V.
5.5 ENFORCEMENT. The Corporation is specifically authorized to seek
equitable relief, including injunctive relief, to enforce the provisions of this
Article V.
5.6 NON-WAIVER. No delay or failure on the part of the
Corporation or the Board of Directors in exercising any right hereunder shall
operate as a waiver of any right of the Corporation or the Board of Directors,
as the case may be, except to the extent specifically waived in writing.
ARTICLE VI
REPURCHASE OF SHARES; SUPERMAJORITY VOTES;
PREEMPTIVE RIGHTS; CUMULATIVE VOTING
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6.1 RIGHT TO REPURCHASE SHARES. In addition to the specific
rights to redeem certain classes of shares upon the happening of certain events
or under certain circumstances, as provided in these Articles of Incorporation,
the Corporation, through its Board of Directors, shall have the right and power
to repurchase any of its outstanding shares at such times, for such
considerations and upon such terms and conditions as may be agreed upon between
the Corporation and the selling shareholder or shareholders.
6.2 NO PREEMPTIVE RIGHTS. No holders of shares of the Corporation
shall have any pre-emptive right to subscribe for or to purchase any shares of
the Corporation of any class, whether now or hereafter authorized.
6.3 LIMITATION ON SUPERMAJORITY VOTES. Notwithstanding any
provision of the Revised Code of Ohio now or hereafter in force requiring for
any purpose the vote or consent of the holders of shares entitling them to
exercise two-thirds, or any other proportion, of the voting power of the
Corporation or of any class or classes of shares thereof, such action, unless
otherwise expressly required by a provision of the Revised Code of Ohio or the
Articles of Incorporation of the Corporation, may be taken by the vote or
consent of the holders of shares entitling them to exercise a majority of the
voting power of the Corporation, or of such class or classes of shares thereof.
6.4 NO CUMULATIVE VOTING. Notwithstanding any provision of the
Revised Code of Ohio now or hereafter in effect, no shareholder shall have the
right to vote cumulatively in the election of directors. Without limiting the
generality of the immediately preceding sentence, no shareholder shall have the
right at any time in the election of directors either to give one candidate as
many votes as the number of directors to be elected multiplied by the number of
his or her votes, or to distribute his or her votes on the same principle among
two or more candidates.
ARTICLE VII
REIT QUALIFICATION; REPORTING COMPANY STATUS
7.1 REIT QUALIFICATION. The Board of Directors shall use its
reasonable best efforts to take such actions as are necessary or appropriate to
qualify and preserve the status of the Corporation as a real estate investment
trust ("REIT") for purposes of the federal income tax laws. Subject to Section
7.3 hereof, if the Board of Directors determines that it is no longer in the
best interests of the Corporation to continue to be qualified as a REIT, the
Board of Directors may revoke or otherwise terminate the Corporation's REIT
election pursuant to Section 856(g) of the Code.
7.2 REPORTING COMPANY STATUS. At all times that any Class C
Preferred Shares or any Class D Preferred Shares are outstanding and are held by
any Person other than the Bank or an Affiliate of the Bank, the Corporation
shall maintain its status as a reporting company under the Securities Exchange
Act of 1934.
ARTICLE VIII
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DIRECTORS
8.1 NUMBER OF DIRECTORS; INDEPENDENT DIRECTORS. At all times
that any Class C Preferred Shares or any Class D Preferred Shares are
outstanding, the Board of Directors of the Corporation shall consist of at least
nine persons, at least three of whom shall be "Independent Directors," which
shall mean that such persons are not at such time either a director, officer, or
employee of the Corporation or any direct or indirect subsidiary of Huntington
Bancshares Incorporated. For purposes of this Article VIII, any Preferred
Directors elected pursuant to Section 4.5.4(b) hereof or Section 4.6.4(b)
hereof, shall be deemed to be additional Independent Directors.
8.2 STANDARD OF REVIEW BY INDEPENDENT DIRECTORS. The Independent
Directors shall consider the interests of the holders of both the common shares
and all classes of Preferred Shares, specifically to include the holders of the
Class C Preferred Shares and the holders of the Class D Preferred Shares, in
determining whether any proposed action requiring the approval of the Board of
Directors or of the Independent Directors is in the best interests of the
Corporation.
8.3 CERTAIN ACTIONS REQUIRING THE APPROVAL OF THE INDEPENDENT
DIRECTORS. At all times that any Class C Preferred Shares or Class D Preferred
Shares are outstanding, none of the following actions may be taken by the
Corporation without the approval of a majority of the Independent Directors:
(i) the issuance of any additional shares of the Corporation
that constitute Parity Stock as to either the Class C
Preferred Shares or the Class D Preferred Shares;
(ii) the incurrence of Indebtedness other than Permitted
Indebtedness;
(iii) the termination or modification of, or the election not
to renew, the Participation Agreement between the
Bank and Huntington Preferred Capital Holdings, Inc.,
dated May 1, 1998, as heretofore amended, the
Subparticipation Agreement between Huntington
Preferred Capital Holdings, Inc. and the Corporation,
dated May 1, 1998, as heretofore amended, or the
subcontracting of any duties under these agreements
to third parties unaffiliated with the Bank;
(iv) a change in the Corporation's policy of limiting
authorized investments which are not mortgages or
other liens on and interests in real estate to no
more than 20% of the value of the total assets of the
Corporation or a change in the Corporation's
investment policy that would be inconsistent with its
exemption under the Investment Company Act of 1940,
as amended;
(v) any consolidation, conversion, merger, or share exchange
that is not tax-free to holders of the Class C
Preferred Shares unless such transaction is required
to be approved by a two-thirds vote of the holders of
the Class C Preferred Shares;
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(vi) the determination to revoke the Corporation's status as
a REIT or any amendment to the REIT-related transfer
restrictions on any shares of the capital stock of
the Corporation; or
(vii) the dissolution, liquidation, or termination of the
Corporation prior to [_____________], 2021.
ARTICLE IX
AMENDMENTS
The Corporation reserves the right from time to time to make any
amendment to its Articles of Incorporation, now or hereafter authorized by law,
including any amendment altering the terms or contract rights, as expressly set
forth in these Articles of Incorporation, of any outstanding shares of the
Corporation. All rights and powers conferred by the Articles of Incorporation on
shareholders, directors, and officers of the Corporation are granted subject to
this reservation. Subject to the rights of the holders of Class C Preferred
Shares set forth in Section 4.5 hereof and the rights of the holders of Class D
Preferred Shares set forth in Section 4.6 hereof, any amendment to the Articles
of Incorporation shall be valid only if approved by the affirmative vote of a
majority of all the votes entitled to be cast on the matter. Any amendment to
Section 4.5 of the Articles of Incorporation shall be valid only if approved as
provided therein and any amendment to Section 4.6 of the Articles of
Incorporation shall be valid only if approved as provided therein.
ARTICLE X
SUPERSESSION
These Amended and Restated Articles of Incorporation take the place of
and supersede the existing Articles of Incorporation of the Corporation, as
heretofore amended.
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