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EXHIBIT (3)(a)
CERTIFICATE OF ADOPTION
OF
AMENDED ARTICLES OF INCORPORATION
OF
THE LUBRIZOL CORPORATION
L.E. Coleman, Chairman of the Board of Directors, and
K.H. Hopping, Vice President and Secretary, of The Lubrizol
Corporation, an Ohio corporation (the "Corporation") with its
principal place of business located in Wickliffe, Ohio, do
hereby certify that a meeting of the Board of Directors of the
Corporation was duly called and held on September 23, 1991, at
which meeting a quorum of the directors of the Corporation was
present, and that by the affirmative vote of the majority of
such directors the following resolution was adopted for the
purpose of consolidating the existing Amended Articles of
Incorporation and the amendments to the existing Amended
Articles of Incorporation that previously have been adopted by
the shareholders of the Corporation and filed with the
Secretary of State of Ohio (such consolidation being permitted
by Section 1701.72(B) of the Ohio Revised Code):
RESOLVED, that the Amended Articles of Incorporation
attached hereto as Exhibit A be, and they hereby are,
adopted to supersede the existing Amended Articles of
Incorporation of the Corporation.
IN WITNESS WHEREOF, L.E. Coleman, Chairman of the
Board of Directors, and K.H. Hopping, Vice President and
Secretary, of The Lubrizol Corporation, acting for and on
behalf of the Corporation, have hereunto subscribed their names
this 23rd day of September, 1991.
/s/ [L.E. Coleman]
L.E. Coleman
Chairman of the Board
/s/ [K.H. Hopping]
K.H. Hopping
Vice President and Secretary
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3380P Exhibit A
AMENDED ARTICLES OF INCORPORATION
OF
THE LUBRIZOL CORPORATION
FIRST: The name of the Corporation is The Lubrizol
Corporation.
SECOND: The place in the State of Ohio where its
principal office is located is Wickliffe, Lake County.
THIRD: The purposes of the Corporation are as follows:
To manufacture, produce, process, buy, sell,
develop, acquire, distribute and otherwise deal in
chemicals, chemical products and compositions,
including lubricants, fuels and additives for
lubricants and fuels, and to do all things necessary
or incidental thereto.
To invest in high technology companies and in
companies with substantial growth possibilities and to
acquire such companies.
To engage in any other lawful act or activity for
which corporations may be formed under Section 1701.01
to 1701.98, inclusive, of the Revised Code of Ohio, as
now in effect or hereafter amended.
FOURTH: The authorized number of shares of the
Corporation is 147,000,000, consisting of 2,000,000 shares of
serial preferred stock without par value designated Serial
Preferred Stock ("Serial Preferred Stock"); 25,000,000 shares
of serial preferred stock without par value designated Serial
Preference Shares ("Serial Preference Shares"); and 120,000,000
common shares without par value ("Common Shares").
No holder of any class of shares of the Corporation
shall, as such holder, have any preemptive or preferential
right to purchase or subscribe to any shares of any class of
stock of the Corporation, whether now or hereafter authorized,
whether unissued or in treasury, or to purchase any obligations
convertible into shares of any class of stock of the
Corporation, which at any time may be proposed to be issued by
the Corporation or subjected to rights or options to purchase
granted by the Corporation.
No holder of shares of the Corporation shall be
entitled to vote cumulatively in the election of Directors of
the Corporation.
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The shares of such classes shall have the following
express terms:
DIVISION A
EXPRESS TERMS OF THE SERIAL PREFERRED STOCK
Section 1. The Serial Preferred Stock may be issued
from time to time in one or more series. All shares of Serial
Preferred Stock shall be of equal rank and shall be identical,
except in respect of the matters that may be fixed by the Board
of Directors as hereinafter provided, and each share of each
series shall be identical with all other shares of such series,
except as to the date from which dividends are cumulative.
Subject to the provisions of Sections 2 to 8, both inclusive,
of this Division, which provisions shall apply to all Serial
Preferred Stock, the Board of Directors hereby is authorized to
cause such shares to be issued in one or more series and with
respect to each such series prior to the issuance thereof to
fix:
(a) The designation of the series, which may be
by distinguishing number, letter or title;
(b) The number of shares of the series, which
number the Board of Directors may (except where
otherwise provided in the creation of the series)
increase or decrease (but not below the number of
shares thereof then outstanding);
(c) The annual dividend rate of the series;
(d) The dates at which dividends, if declared,
shall be payable, and the dates from which dividends
shall be cumulative;
(e) The redemption rights and price or prices,
if any, for shares of the series;
(f) The terms and amount of any sinking fund
provided for the purchase or redemption of shares of
the series;
(g) The amounts payable on shares of the series
in the event of any voluntary or involuntary
liquidation, dissolution, or winding up of the affairs
of the Corporation;
(h) Whether the shares of the series shall be
convertible into Common Shares, and, if so, the
conversion price or prices, any adjustments thereof,
and all other terms and conditions upon which such
conversion may be made; and
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(i) Restrictions (in addition to those set forth
in Sections 6(b) and 6(c) of this Division) on the
issuance of shares of the same series or of any other
class or series;
provided, however, that the aggregate amount which the holders
of Serial Preferred Stock at any time outstanding shall be
entitled to receive upon any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation shall
not exceed $50,000,000, plus accrued and unpaid dividends.
The Board of Directors is authorized to adopt from
time to time amendments to the Articles of Incorporation
fixing, with respect to each such series, the matters described
in clauses (a) to (i), both inclusive, of this Section 1.
Section 2. The holders of Serial Preferred Stock of
each series, in preference to the holders of Common Shares and
of any other class of shares ranking junior to the Serial
Preferred Stock, shall be entitled to receive out of any funds
legally available and when and as declared by the Board of
Directors, dividends in cash at the rate for such series fixed
in accordance with the provisions of Section 1 of this
Division, and no more, payable quarterly on the dates fixed for
such series. Such dividends shall be cumulative, in the case
of shares of each particular series, from and after the date or
dates fixed with respect to such series. No dividends may be
paid upon or declared or set apart for any of the Serial
Preferred Stock for any quarterly dividend period unless at the
same time a like proportionate dividend for the same quarterly
dividend period, ratably in proportion to the respective annual
dividend rates fixed therefor, shall be paid upon or declared
or set apart for all Serial Preferred Stock of all series then
issued and outstanding and entitled to receive such dividend.
Section 3. In no event so long as any Serial
Preferred Stock shall be outstanding shall any dividends,
except a dividend payable in Common Shares or other shares
ranking junior to the Serial Preferred Stock, be paid or
declared or any distribution be made except as aforesaid on the
Common Shares or any other shares ranking junior to the Serial
Preferred Stock, nor shall any Common Shares or any other
shares ranking junior to the Serial Preferred Stock be
purchased, retired or otherwise acquired by the Corporation
(except out of the proceeds of the sale of Common Shares or
other shares ranking junior to the Serial Preferred Stock
received by the Corporation subsequent to January 1, 1969):
(a) Unless all accrued and unpaid dividends on
Serial Preferred Stock, including the full dividends
for the current quarterly dividend period, shall have
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been declared and paid or a sum sufficient for payment
thereof set apart; and
(b) Unless there shall be no arrearages with
respect to the redemption of Serial Preferred Stock of
any series from any sinking fund provided for shares
of such series in accordance with the provisions of
Section 1 of this Division.
Section 4.
(a) Subject to the express terms of each series
and to the provisions of Section 6(b)(iii) of this
Division A, the Corporation may from time to time
redeem all or any part of the Serial Preferred Stock
of any series at the time outstanding, (i) at the
option of the Board of Directors at the applicable
redemption price for such series fixed in accordance
with the provisions of Section 1 of this Division, or
(ii) in fulfillment of the requirements of any sinking
fund provided for shares of such series at the
applicable sinking fund redemption price, fixed in
accordance with the provisions of Section 1 of this
Division, together in each case with accrued and
unpaid dividends to the redemption date.
(b) Notice of every such redemption shall be
mailed, postage prepaid, to the holders of record of
the Serial Preferred Stock to be redeemed at their
respective addresses then appearing on the books of
the Corporation, not less than thirty (30) days nor
more than sixty (60) days prior to the date fixed for
such redemption. At any time after notice has been
given as above provided, the Corporation may deposit
the aggregate redemption price of the shares of Serial
Preferred Stock to be redeemed with any bank or trust
company in Cleveland, Ohio, or New York, New York,
having capital and surplus of not less than
Twenty-Five Million Dollars ($25,000,000), named in
such notice, directed to be paid to the respective
holders of the shares of Serial Preferred Stock so to
be redeemed in amounts equal to the redemption price
of all shares of Serial Preferred Stock so to be
redeemed, on surrender of the stock certificate or
certificates held by such holders, and upon the making
of such deposit such holders shall cease to be
shareholders with respect to such shares, and after
such notice shall have been given and such deposit
shall have been made such holders shall have no
interest in or claim against the Corporation with
respect to such shares except only to receive such
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money from such bank or trust company without interest
or the right to exercise, before the redemption date,
any unexpired privileges of conversion. In case less
than all of the outstanding shares of Serial Preferred
Stock are to be redeemed, the Corporation shall select
by lot the shares so to be redeemed in such manner as
shall be prescribed by its Board of Directors.
If the holders of shares of Serial Preferred
Stock which have been called for redemption shall not
within ten years after such deposit, claim the amount
deposited for the redemption thereof, any such bank or
trust company shall, upon demand, pay over to the
Corporation such unclaimed amounts and thereupon such
bank or trust company and the Corporation shall be
relieved of all responsibility in respect thereof and
to such holders.
(c) Any shares of Serial Preferred Stock which
are redeemed by the Corporation pursuant to the
provisions of this Section 4 and any shares of Serial
Preferred Stock which are purchased and delivered in
satisfaction of any sinking fund requirements provided
for shares of such series and any shares of Serial
Preferred Stock which are converted in accordance with
the express terms thereof, shall be cancelled, and not
reissued. Any shares of Serial Preferred Stock
otherwise acquired by the Corporation shall resume the
status of authorized and unissued shares of Serial
Preferred Stock without serial designation.
Section 5.
(a) The holders of Serial Preferred Stock of any
series shall, in case of voluntary or involuntary
liquidation, dissolution or winding up of the affairs
of the Corporation, be entitled to receive in full out
of the assets of the Corporation, including its
capital, before any amount shall be paid or
distributed among the holders of the Common Shares or
any other shares ranking junior to the Serial
Preferred Stock, the amounts fixed with respect to
shares of such series in accordance with Section 1 of
this Division plus an amount equal to all dividends
accrued and unpaid thereon to the date of payment of
the amount due pursuant to such liquidation,
dissolution or winding up of the affairs of the
Corporation. In case the net assets of the
Corporation legally available therefor are
insufficient to permit the payment upon all
outstanding shares of Serial Preferred Stock of the
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full preferential amount to which they are
respectively entitled, then such net assets shall be
distributed ratably upon outstanding shares of Serial
Preferred Stock in proportion to the full preferential
amount to which each such share is entitled.
After payment to holders of Serial Preferred
Stock of the full preferential amounts as aforesaid,
holders of Serial Preferred Stock as such shall have
no right or claim to any of the remaining assets of
the Corporation.
(b) The merger or consolidation of the
Corporation into or with any other corporation, or the
merger of any other corporation into it, or the sale,
lease or conveyance of all or substantially all the
property or business of the Corporation, shall not be
deemed to be a dissolution, liquidation or winding up
for the purposes of this Section 5.
Section 6.
(a) The holders of Serial Preferred Stock shall
be entitled to one vote for each share of such stock
upon all matters presented to the shareholders; and,
except as otherwise provided herein or required by
law, the holders of Serial Preferred Stock and the
holders of Common Shares shall vote together as one
class on all matters.
If, and so often as, the Corporation shall be in
default in the payment of six (6) full quarterly
dividends (whether or not consecutive) on any series
of Serial Preferred Stock at the time outstanding,
whether or not earned or declared, the holders of
Serial Preferred Stock of all series, voting
separately as a class and in addition to all other
rights to vote for directors, shall be entitled to
elect as herein provided, two members of the Board of
Directors of the Corporation; provided, however, that
the holders of shares of Serial Preferred Stock shall
not have or exercise such special class voting rights
except at meetings of the shareholders for the
election of directors at which the holders of not less
than thirty-five percent (35%) of the outstanding
shares of Serial Preferred Stock of all series then
outstanding are present in person or by proxy; and
provided further that the special class voting rights
provided for herein when the same shall have become
vested shall remain so vested until all accrued and
unpaid dividends on the Serial Preferred Stock of all
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series then outstanding shall have been paid,
whereupon the holders of Serial Preferred Stock shall
be divested of their special class voting rights in
respect of subsequent elections of directors, subject
to the revesting of such special class voting rights
in the event hereinabove specified in this paragraph.
In the event of default entitling the holders of
Serial Preferred Stock to elect two directors as above
specified, a special meeting of the shareholders for
the purpose of electing such directors shall be called
by the Secretary of the Corporation upon written
request of, or may be called by, the holders of record
of at least ten percent (10%) of the shares of Serial
Preferred Stock of all series at the time outstanding,
and notice thereof shall be given in the same manner
as that required for the annual meeting of
shareholders; provided, however, that the Corporation
shall not be required to call such special meeting if
the annual meeting of shareholders shall be held
within one hundred twenty (120) days after the date of
receipt of the foregoing written request from the
holders of Serial Preferred Stock. At any meeting at
which the holders of Serial Preferred Stock shall be
entitled to elect directors, the holders of
thirty-five percent (35%) of the then outstanding
shares of Serial Preferred Stock of all series present
in person or by proxy, shall be sufficient to
constitute a quorum, and the vote of the holders of a
majority of such shares so present at any such meeting
at which there shall be such a quorum shall be
sufficient to elect the members of the Board of
Directors which the holders of Serial Preferred Stock
are entitled to elect as hereinabove provided. The
two directors who may be elected by the holders of
Serial Preferred Stock pursuant to the foregoing
provisions shall be in addition to any other directors
then in office or proposed to be elected otherwise
then pursuant to such provisions, and nothing in such
provisions shall prevent any change otherwise
permitted in the total number of directors of the
Corporation or require the resignation of any director
elected otherwise than pursuant to such provisions.
Notwithstanding any classification of the other
directors of the Corporation, the two directors
elected by the holders of Serial Preferred Stock shall
be elected annually for terms expiring at the next
succeeding annual meeting of shareholders.
(b) The affirmative vote of the holders of at
least two-thirds of the shares of Serial Preferred
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Stock at the time outstanding, given in person or by
proxy at a meeting called for the purpose at which the
holders of Serial Preferred Stock shall vote
separately as a class shall be necessary to effect any
one or more of the following (but so far as the
holders of Serial Preferred Stock are concerned, such
action may be effected with such vote):
(i) Any amendment, alteration or repeal of
any of the provisions of the Articles of
Incorporation or of the Regulations of the
Corporation which affects adversely the voting
powers, rights or preferences of the holders of
Serial Preferred Stock; provided, however, that,
for the purpose of this clause (i) only, neither
the amendment of the Articles of Incorporation so
as to authorize or create, or to increase the
authorized or outstanding amount of Serial
Preferred Stock or of any shares of any class
ranking on a parity with or junior to the Serial
Preferred Stock, nor the amendment of the
provisions of the Regulations so as to increase
the number of directors of the Corporation shall
be deemed to affect adversely the voting powers,
rights or preferences of the holders of Serial
Preferred Stock; and provided further, that if
such amendment, alteration or repeal affects
adversely the rights or preferences of one or
more but not all series of Serial Preferred Stock
at the time outstanding only the affirmative vote
of the holders of at least two-thirds of the
number of the shares at the time outstanding of
the series so affected shall be required;
(ii) The authorization or creation of, or the
increase in the authorized amount of, any shares
of any class, or any security convertible into
shares of any class, ranking prior to the Serial
Preferred Stock; or
(iii) The purchase or redemption (for sinking
fund purposes or otherwise) of less than all of
the Serial Preferred Stock then outstanding
except in accordance with a stock purchase offer
made to all holders of record of Serial Preferred
Stock, unless all dividends upon all Serial
Preferred Stock then outstanding for all previous
quarterly dividend periods shall have been
declared and paid or funds therefor set apart and
all accrued sinking fund obligations applicable
thereto shall have been complied with.
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(c) The affirmative vote of the holders of at
least a majority of the shares of Serial Preferred
Stock at the time outstanding, given in person or by
proxy at a meeting called for the purpose at which the
holders of Serial Preferred Stock shall vote
separately as a class, shall be necessary to effect
any one or more of the following (but so far as the
holders of Serial Preferred Stock are concerned, such
action may be effected with such vote):
(i) The sale, lease or conveyance by the
Corporation of all or substantially all of its
property or business, or its consolidation with
or merger into any other corporation unless the
corporation resulting from such consolidation or
merger will have after such consolidation or
merger no class of shares either authorized or
outstanding ranking prior to or on a parity with
the Serial Preferred Stock except the same number
of shares ranking prior to or on a parity with
the Serial Preferred Stock and having the same
rights and preferences as the shares of the
Corporation authorized and outstanding
immediately preceding such consolidation or
merger, and each holder of Serial Preferred Stock
immediately preceding such consolidation or
merger shall receive the same number of shares,
with the same rights and preferences, of the
resulting corporation; or
(ii) The authorization of any shares ranking
on a parity with the Serial Preferred Stock or an
increase in the authorized number of shares of
Serial Preferred Stock.
Section 7. The holders of Serial Preferred Stock
shall have no preemptive right to purchase or have offered to
them for purchase any shares or other securities of the
Corporation, whether now or hereafter authorized.
Section 8. For the purpose of this Division A:
Whenever reference is made to shares "ranking prior to
the Serial Preferred Stock" or "on a parity with the Serial
Preferred Stock," such reference shall mean and include all
shares of the Corporation in respect of which the rights of the
holders thereof as to the payment of dividends or as to
distributions in the event of a voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the
Corporation, are given preference over, or rank on an equality
with (as the case may be) the rights of the holders of Serial
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Preferred Stock; and whenever reference is made to shares
"ranking junior to the Serial Preferred Stock," such reference
shall mean and include all shares of the Corporation in respect
of which the rights of holders thereof as to payment of
dividends and as to distributions in the event of a voluntary
or involuntary liquidation, dissolution or winding up of the
affairs of the Corporation, are junior and subordinate to the
rights of the holders of Serial Preferred Stock.
DIVISION B
EXPRESS TERMS OF THE COMMON SHARES
The Common Shares shall be subject to the express
terms of (i) the Serial Preferred Stock and any series thereof
and (ii) the Serial Preference Shares and any series thereof.
Each Common Share shall be equal to every other Common Share
and the holders thereof shall be entitled to one vote for each
share of such stock on all questions presented to the
shareholders.
DIVISION C
EXPRESS TERMS OF THE SERIAL PREFERRED STOCK, SERIES A
Section 1. Designation and Amount. The shares of
such series shall be designated as "Serial Preferred Stock,
Series A" ("Series A Stock") and the number of shares
constituting such series shall be 2,000,000. No shares of
Series A Stock may be issued except upon the exercise of a
Right, as defined in, and pursuant to the terms of, the Special
Rights Agreement, dated as of October 31, 1988 (as from time to
time amended or supplemented in accordance with the terms
thereof, the "Rights Agreement"), between the Corporation and
National City Bank.
Section 2. Dividends and Distributions.
(A) Except as provided in this Section 2, the holders
of shares of Series A Stock shall not be entitled to receive
dividends or other distributions with respect to any shares of
Series A Stock.
(B) From and after the date on which shares of
Series A Stock are issued and outstanding (the "Dividend
Accrual Commencement Date"), the holders of issued and
outstanding shares of Series A Stock, in preference to the
holders of Common Shares and of any other capital stock of the
Corporation which ranks junior to the Serial Preferred Stock in
respect of dividends or distributions of assets on liquidation
of the Corporation (all of which classes, other than the Serial
Preferred Stock, are hereinafter embraced in the term "Junior
Stock"), shall be entitled to receive as and when declared by
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the Directors out of the assets of the Corporation which are by
law available for the payment of dividends, cumulative cash
dividends, payable quarterly on the last days of March, June,
September and December, and accruing from the applicable
Dividend Accrual Commencement Date, at, but not exceeding, the
rate per share per annum equal to the Dividend Rate (as
hereinafter defined). For purposes of this Division C, the
"Dividend Rate" shall be equal to 8% of the Cash Redemption
Amount (as defined in Section 5(A) of this Division C) as of
the last day of the calendar month immediately preceding the
applicable dividend payment date.
Section 3. Redemption.
(A) From and after (but not before) the Earliest
Redemption Date (as defined in Section 5(C) of this
Division C), the Series A Stock may be redeemed in whole or in
part, at any time or from time to time, at the option of the
Corporation, for a cash redemption price per share equal to the
sum of (x) the then-applicable Cash Redemption Amount plus
$1.00 and (y) an amount equal to the sum of all dividends
accrued to the date fixed for redemption and remaining unpaid,
whether or not declared, together with any applicable Deferred
Payment Entitlement (as defined in Section 5(D) of this
Division C).
(B) So long as any shares of Series A Stock shall be
outstanding, but subject to Section 3(E) of this Division C,
the Corporation shall, as a sinking fund applicable to the
Series A Stock, commencing on the date two years after the
first date on which any shares of Series A Stock are issued,
and annually thereafter, redeem, for a cash redemption price
per share equal to the sum of (x) the then-applicable Cash
Redemption Amount plus $1.00 and (y) an amount equal to the sum
of all dividends accrued to such date and remaining unpaid,
whether or not declared, together with any applicable Deferred
Payment Entitlement, a number of shares of Series A Stock equal
to 25% of the greatest number of shares of Series A Stock at
any time outstanding. The Corporation shall be permitted to
satisfy in whole or in part the requirements of this
Section 3(B) with respect to any year by applying in whole or
in part as a credit in reduction of the obligation of the
Corporation to make redemptions for the sinking fund in such
year shares of Series A Stock purchased by the Corporation and
shares of Series A Stock redeemed otherwise than for the
sinking fund. Shares purchased by the Corporation for
application as a credit as provided above may be purchased in
such manner as the Directors may determine from time to time,
subject to the restrictions on such purchases set forth
elsewhere herein or arising under applicable law.
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(C) On the date five years after the first date on
which any shares of Series A Stock are issued, but subject to
Section 3(E) of this Division C, the Corporation shall redeem
all shares of Series A Stock remaining outstanding for a cash
redemption price per share equal to the sum of (x) the
then-applicable Cash Redemption Amount plus $1.00 and (y) an
amount equal to the sum of all dividends accrued to such date
and remaining unpaid, whether or not declared, together with
any applicable Deferred Payment Entitlement.
(D) Notwithstanding anything contained in this
Division C to the contrary, but subject to Section 3(E) of this
Division C, at the option of any holder of Series A Stock, upon
written notice given by such holder at any time during the
30-calendar day period following the date on which the last
notice was mailed pursuant to the next sentence of this
Section 3(D) the Corporation shall, prior to the filing of a
certificate of dissolution or such other instrument as may then
be prescribed by applicable law to effect the dissolution of
the Corporation, redeem all shares of Series A Stock
outstanding as to which such holder shall have made such
election for a cash redemption price per share equal to the sum
of (x) the then-applicable Cash Redemption Amount plus $1.00
and (y) an amount equal to the sum of all dividends accrued to
such date and remaining unpaid, whether or not declared,
together with any applicable Deferred Payment Entitlement. The
Corporation shall give notice to all holders of Series A Stock
no fewer than 45-calendar days prior to making any filing
referred to in the immediately preceding sentence, which notice
will be so given by first class United States mail and
publication in The Wall Street Journal and any other nationally
recognized publication the Corporation may elect, accompanied
by an appropriate form of election and such other information
as may be required to permit an informed election.
(E) In addition to the limitations that may apply
under applicable Ohio law, the Corporation shall be required to
redeem any shares of Series A Stock under Sections 3(B), 3(C)
or 3(D) of this Division C only to the extent that, after
giving effect to such redemption, the consolidated retained
earnings of the Corporation and the corporations with which it
is consolidated for financial reporting purposes are greater
than zero. For purposes of the foregoing sentence,
consolidated retained earnings shall mean the sum of (1) the
consolidated retained earnings as of September 30, 1988 of the
Corporation and the corporations with which it was then
consolidated for financial reporting purposes and (2) the
consolidated retained earnings accumulated subsequent to
September 30, 1988 of the Corporation and the corporations with
which it is consolidated for financial reporting purposes
determined in accordance with generally accepted accounting
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principles as in effect as of such date (except as otherwise
provided in this sentence) and after giving effect to dividends
or other distributions on, and redemptions and other purchases
of, Serial Preferred Stock, but without giving effect to
dividends or other distributions on, or redemptions or other
purchases of, any Junior Stock, or to any transfers from
retained earnings to additional capital or capital stock
accounts, and including as a credit to retained earnings, in
all events (and notwithstanding any contrary treatment for
financial reporting purposes or otherwise), the amount of the
Recovery then collected. If the Corporation is not required to
redeem shares of Series A Stock in the manner otherwise
provided herein by virtue of the first sentence of this Section
3(E), or if a legal or contractual restriction prevents the
Corporation form effecting the redemption of any shares of
Series A Stock then outstanding in the manner otherwise
provided herein, then (x) to the extent required and not
restricted, payment of redemption amounts shall be made daily
on a pro rata basis or in such other manner as the Directors of
the Corporation may determine in good faith to be fair to the
holders of Series A Stock, (y) in the case of any such legal or
contractual restriction, the Corporation shall use its best
efforts to remove such restriction as soon as possible, and (z)
the Corporation shall give notice to each holder of shares of
Series A Stock of any such restriction and the efforts by the
Corporation to remove it. Postponement of payment of
redemption amounts shall not in any way diminish or restrict
the right or the holders of shares of Series A Stock to have
their shares redeemed as provided in this Section 3. If
amounts payable to retire shares of Serial Preferred Stock are
not paid in full in the case of all series for which a sinking
fund has been fixed, the number of shares to be retired for the
sinking fund of each such series shall be in proportion to the
respective amounts that would be payable if all such amounts
were paid in full.
Section 4. Liquidation Rights.
(A) The provisions of Section 7(F) of this Division C
will apply to any voluntary to involuntary dissolution,
liquidation or winding up of the affairs of the Corporation and
will not be limited or otherwise affected by this Section 4.
(B) In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the
Corporation (all of which are hereinafter embraced in the word
"liquidation") occurring on or after the Earliest Redemption
Date, the holders of Series A Stock who do not exercise their
rights pursuant to Section 3(D) of this Division C, shall be
entitled to receive, subject to the limitations, if any, then
applicable in such event pursuant to Division A, from the
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assets of the Corporation available for distribution to the
shareholders, all amounts (including without limitation any
Deferred Payment Entitlement) which they would be entitled to
receive if on the date of such liquidation the shares of
Series A Stock held by them had been redeemed at the option of
the Corporation in accordance with the provisions of
Section 3(A) of this Division C. In the event of any
liquidation occurring prior to the Earliest Redemption Date,
all rights of the Corporation in respect of the Covered Cases
and any portion of the Recovery (as defined in Section 5(A) of
this Division C) theretofore collected by the Corporation, and
such additional funds or assets as may be required, shall be
placed in trust for the benefit of the holders of the Series A
Stock (and the holders of any other class of capital stock of
the Corporation to the extent hereinafter provided) upon such
terms so that (1) the holders of Series A Stock shall be
entitled to receive, from the assets of the Corporation
available for distribution to shareholders, units of beneficial
interest in such trust which shall as nearly as practicable
entitle them to receive, per share of Series A Stock held, a
fractional undivided interest in the proceeds of the Recovery
equal to the Per Share Allocation Factor, plus $1.00, and (2)
the holders of the other classes of capital stock of the
Corporation shall be entitled to receive out of such assets
available for distribution units of beneficial interest in such
trust which shall as nearly as practicable entitle them to
receive any balance of the proceeds of the Recovery in
accordance with their respective rights upon liquidation. In
the event of any liquidation, the holders of the Serial
Preferred Stock of the respective series shall be entitled to
be paid in full the respective amounts fixed for such series
before any distribution or payment or setting apart for payment
shall be made to or for the holders of the Common Shares or any
other Junior Stock. After such payments shall have been in
full to the holders of the Serial Preferred Stock, the
remaining assets and funds of the Corporation shall be
distributed among the holders of the Junior Stock of the
Corporation according to their respective rights. In the event
that the assets of the Corporation are not sufficient to make
the payments required to be made to the holders of the Serial
Preferred Stock in full, such assets shall be distributed to
the holders of the Serial Preferred Stock of the respective
series pro rata in proportion to the respective amounts fixed
for such series.
Section 5. Amount Payable on Redemption or
Liquidation.
(A) For purposes of this Division C, the following
terms shall have the meanings indicated:
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(1) "Adjusted Value" of any "Assigned Value
Assets" shall mean, initially, the value assigned
thereto as provided in Section 5(B) of this
Division C, and, in the event any such Assigned Value
Assets shall be sold for cash within two years of the
Corporation's receipt thereof, shall mean, thereafter
and in lieu of the value initially assigned, the cash
proceeds of the sale, increased by the amount of any
revenues derived by the Corporation from, and
decreased by any costs and expenses incurred by the
Corporation after receipt of such Assigned Value
Assets in respect of, such Assigned Value Assets
during the period prior to such sale.
(2) "Assigned Value Assets" shall mean any
assets collected as a part of the Recovery to which a
value has been assigned as provided in Section 5(B) of
this Division C and shall also include the proceeds of
any sale or other disposition thereof.
(3) "Cash Redemption Amount" shall mean, at any
time of determination on or after the Dividend Accrual
Commencement Date, the product obtained by multiplying
(a) the sum of (i) the amount of the Recovery which
shall have been collected in the form of cash and (ii)
the Adjusted Value of any Assigned Value Assets, less
(iii) all amounts which shall have been paid by the
Corporation as dividends on, in redemption of, or for
the repurchase (in accordance with the provisions of
Section 3(B) of this Division C) of, shares of
Series A Stock, and all dividends which shall have
accrued but not been paid (whether or not declared),
on shares of Series A Stock by (b) the Per Share
Allocation Factor.
(4) "Covered Cases" shall mean, collectively,
the civil actions captioned The Lubrizol Corporation,
an Ohio corporation vs. Exxon Corporation, a New
Jersey corporation, in the United States District
Court for the Southern District of Texas (Civil Action
Nos. H-84-1627 and H-85-2450), and in the United
States District Court for the Northern District of
Ohio (Civil Action Nos. C84-1064 and C85-3135), and
all civil actions, whether in or before a state,
federal or foreign court or other authority,
designated either specifically or generically, as
Covered Cases by majority vote of the Directors of the
Corporation prior to the first date on which shares of
Series A Stock are issued, and all the right, title
and interest of the Corporation in and under all such
actions, and in and under all actions, suits or
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proceedings determined by majority vote of the
Directors of the Corporation, prior to the first date
on which shares of Series A Stock are issued, to be
directly related thereto or to have arisen therefrom,
and to all claims asserted therein (whether asserted
in such actions or any action to enforce any judgment
or order therein or otherwise).
(5) "Deferred Payment Entitlement" shall have
the meaning referred to in Section 5(D) of this
Division C.
(6) "Recovery" shall mean the collective total
amount which the Corporation (or its successors and
assigns to the extent permitted hereby) shall collect,
whether in cash or other assets and whether collected
in one of more payments or transactions, on account of
favorable judgments in the Covered Cases or settlement
in respect thereof, less the sum of (a) an amount
equal the product of (i) such collective total amount
and (ii) the Corporation's effective income tax rate
disclosed by the Corporation in the notes to the
financial statements of the Corporation last published
and furnished to shareholders immediately prior to the
first issuance of any shares of Series A Stock and (b)
any amount which the Corporation (or its successors
and assigns to the extent permitted hereby) shall
collect in respect of any interest assigned by the
Corporation as a Deferred Payment Entitlement.
(7) "Per Share Allocation Factor" shall mean, at
any time of determination, the fraction which results
from dividing 1 by the sum of (a) the total number of
shares of Series A Stock then outstanding and (b) the
total number of shares of Series A Stock then subject
to issuance upon the proper exercise of outstanding
Rights.
(B) If and whenever the Corporation shall receive any
proceeds of the Recovery in a form other than cash, there shall
be assigned to such assets an amount equal to the fair market
value thereof as determined in good faith by the Directors,
unless the Directors of the Corporation shall determine that it
is not possible to assign a fair market value to such assets
with a reasonable level of confidence. The Directors of the
Corporation shall make such determination at the time such
assets are collected or, if it is determined as aforesaid that
it is not possible to assign a fair market value thereto with a
reasonable level of confidence, at the first opportunity
thereafter when it is possible to make such a determination in
good faith. The assets to which a value has been assigned in
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accordance with this Section 5(B) are referred to therein as
"Assigned Value Assets" and the value so assigned shall be the
initial Adjusted Value of such assets. If a fair market value
cannot reasonably be assigned to any assets, the Corporation
shall use its best efforts to dispose of such assets as
promptly as practicable, subject to the judgment of the
Directors as to the best interests of the holders of Series A
Stock. Pending such disposition the Corporation shall keep
accurate records relating to such assets.
(C) The "Earliest Redemption Date" shall mean the
first date on which the Corporation shall have collected, in
respect of any of the Covered Cases, in the form of cash and/or
assets constituting Assigned Value Assets, aggregate proceeds
of the Recovery having a value (based on the amount of cash to
received together with the Adjusted Value of any Assigned Value
Assets) in excess of $50,000,000.
(D) Whenever the Corporation shall redeem any shares
of Series A Stock when either (1) the prospect remains that
additional amounts will be collected in respect of the Covered
Cases or (2) any portion of the Recovery then collected
consists of assets other than cash or Assigned Value Assets,
the Corporation shall, in connection with such redemption,
assign to the holder of each share of Series A Stock then being
redeemed an undivided fractional interest equal to the Per
Share Allocation Factor then in effect in all the Corporation's
right, title and interest in (x) such additional amounts as may
be collected in respect of the Covered Cases as provided in the
foregoing clause (1) and/or the proceeds thereof and (y) the
proceeds of the sale or other disposition of any assets other
than cash or Assigned Value Assets plus the revenues derived by
the Corporation therefrom. The form and manner of assignment
shall be as determined by the Directors of the Corporation so
as to best convey to the holders of the shares of Series A
Stock being redeemed the benefits contemplated hereby;
provided, however, that such holders shall not by reason of the
assignment of the Corporation's interest in the foregoing
proceeds have any right to control the prosecution of the
Covered Cases, the collection of any amounts recoverable
thereunder of the operation or disposition of the aforesaid
assets, and provided, further, that the Corporation may provide
that the interests as assigned shall be non-transferable. The
interest assigned in accordance with this Section 5(D) in
respect of any share of Series A Stock being redeemed is
referred to herein as a "Deferred Payment Entitlement" in
respect of such share.
Section 6. Voting Rights. The voting rights relating
to the Serial Preferred Stock set forth in Section 6 of
Division A of Article Fourth are applicable to the Series A
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Stock. Except as so provided, and except as required by
applicable law, the holders of shares of Series A Stock shall
have no voting rights with respect to any action by the
Corporation or its shareholders by virtue of being a holder of
shares of Series A Stock.
Section 7. Limitations.
(A) So long as any shares of Series A Stock are
outstanding, no shares of any series of Serial Preferred Stock
or other capital stock of the Corporation other than Common
Shares having the express terms applicable to Common Shares on
the Share Acquisition Date (as defined in Section 8(B) of this
Division C) or the Series A Stock, and no shares of Series A
Stock not issuable pursuant to and in accordance with the
Rights Agreement, may be issued by the Corporation.
(B) So long as any shares of Series A Stock are
outstanding, the Corporation shall not invest any portion of
the proceeds of the Recovery (other than any non-cash assets
collected as a part thereof) in other than "Permitted
Investments." For purposes of this Section 7(C), "Permitted
Investments" shall include the following obligations and
securities:
(a) United States Treasury bonds, notes and
bills;
(b) certificates of deposit issued by major
commercial banks;
(c) Eurodollar time deposits placed with major
commercial banks;
(d) corporate bonds, debentures and notes (none
of which shall be convertible into any equity
security) rated A or better by Moody's Investors
Services and by Standard & Poor's Corporation;
(e) non-convertible preferred stock rated A or
better by Moody's Investors Services and by Standard &
Poor's Corporation; and
(f) commercial paper rated Prime-2 or better by
Moody's Investors Services and A-1 or better by
Standard & Poor's Corporation.
In no event shall any portion of the proceeds of the Recovery
be invested in any obligation or other security of a Prohibited
Transferee.
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(C) So long as any shares of Series A Stock are
outstanding, the Corporation shall not settle or otherwise
compromise the Covered Cases, direct counsel to make any change
in the strategy for conducting the Covered Cases, fail to pay
any costs or expenses of conducting the Covered Cases which
might diminish the likelihood of a favorable result therein or
otherwise adversely affect the conduct of the Covered Cases,
except, in each case, with the approval of the Directors of the
Corporation.
(D) So long as any shares of Series A Stock are
outstanding, the Corporation shall not sell, assign or
otherwise transfer the Covered Cases or any interest therein
unless the Directors of the Corporation shall have previously
determined in good faith that the proceeds to be realized
thereby are fair to the holders of the Series A Stock.
(E) So long as any shares of Series A Stock are
outstanding, the Corporation shall not (i) consolidate with,
(ii) merge with or into, (iii) sell or transfer to, in one or
more transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its
subsidiaries, taken as a whole, any Prohibited Transferee or
any Affiliate or Associate thereof (as such terms are defined
in Section 8(B) of this Division C), or (iv) liquidate,
dissolve or otherwise wind-up the affairs of the Corporation,
if at the time of, after or as a result of such consolidation,
merger, sale, liquidation, dissolution or winding up there
would be any charter or regulation provisions, including
without limitation any provisions of the Corporation's Amended
Articles of Incorporation or Regulations, as from time to time
amended, of any rights, options, warrants or other instruments
or securities outstanding or agreements in effect or any other
actions taken, which would eliminate or otherwise diminish the
benefits intended to be afforded by the Rights of the Series A
Stock, without proper provision being made for the redemption
of the Series A Stock in accordance with Section 7(E) of this
Division C.
Section 8. Contributions and Transfer.
(A) The Series A Stock shall not be transferable to
or by a Prohibited Transferee and any attempt to transfer
shares of Series A Stock to or by a Prohibited Transferee shall
be null and void. The Corporation reserves the right to
require (or to cause any transfer agent of the Corporation to
require) any Person who submits a share of Series A Stock for
transfer on the transfer books of the Corporation or for
redemption pursuant to Section 3 hereof to establish to the
satisfaction of the Corporation that such Person did not
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acquire such shares of Series A Stock while or from a
Prohibited Transferee.
(B) As used in this Division C, the term "Prohibited
Transferee" shall mean, at the time any determination is to be
made, (1) any Person other than the Corporation or any Related
Person (as such terms are hereinafter defined), who or which,
together with all Affiliates and Associates (as such terms are
defined in Rule 12b-2 of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended, and in
effect on the date of first issuance of any shares of Series a
Stock (the "Exchange Act")) of such Person, shall be the
beneficial owner of 20% or more of the Common Shares then
outstanding or (2) any Person (other than the Corporation or
any Related Person) who or which, together with all Affiliates
or Associates of such Person (A) commences or announces its
intention to commence a tender or exchange offer the
consummation of which would result in beneficial ownership by
such Person of 20% or more of the Common Shares then
outstanding, or announces its intention otherwise to purchase
or acquire (b) 20% or more of the Common Shares then
outstanding. The term "Person" shall mean any individual,
firm, corporation, partnership or other entity, and shall
include any successor (by merger or otherwise) of such entity.
The term "Related Person" shall mean (x) any subsidiary of the
Corporation, (y) any employee benefit or stock ownership plan
of the Corporation or any entity holding Common Shares for or
pursuant to the terms of any such plan, or (z) any Person who
acquires Common Shares from the Corporation or any other
Related Person in one or a series of related transactions, each
of which is approved by a majority of the Directors of the
Corporation; provided, however, that if any Person who becomes
a Related Person solely by virtue of subsection (z) above, or
any Affiliate or Associate of such Person, subsequently becomes
the beneficial owner of any additional Common Shares in a
transaction or transactions not approved by a majority of the
Directors of the Corporation, such Person shall no longer be
deemed a "Related Person" with respect to all Common Shares of
which it, or any of its Affiliates or Associates, is the
beneficial owner. The term "Distribution Date" shall mean the
close of business on the fifteenth calendar day (or such other
date as any be specified by a majority vote of the Directors
then in office) after the Share Acquisition Date. The term
"Share Acquisition Date" shall mean the first date of public
announcement by the Corporation or a Prohibited Transferee (by
press release, filing made with the Securities and Exchange
Commission or otherwise) that a Prohibited Transferee has
become such. For the purposes of this Division C, a Person
shall be deemed the "Beneficial Owner" of and shall be deemed
"beneficially to own" any securities: (i) which such Person or
any of such Person's Affiliates or Associates, directly or
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indirectly, has the right to acquire (whether such right is
exercisable immediately or only after the passage of time or
the occurrence or nonoccurrence of an event) pursuant to any
agreement, arrangement or understanding (whether or not in
writing), or upon the exercise of conversion rights, exchange
rights, other rights (other than the Other Rights), warrants,
options or otherwise; provided, however, that a Person shall
not be deemed the Beneficial Owner of, or beneficially to own,
securities tendered pursuant to a tender or exchange offer made
by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are
accepted for purchase or exchange; or (ii) which such Person or
any of such Person's Affiliates or Associates, directly or
indirectly, has the right or power to vote or dispose of, or to
direct the vote or disposition of, including pursuant to any
agreement, arrangement or understanding (whether or not in
writing); or (iii) which any other Person is the beneficial
Owner if such other Person or any of the Affiliates or
Associates of such other Person has any agreement, arrangement
or understanding (whether or not in writing) with the first
Person or the Affiliates or Associates of the first Person with
respect to acquiring, holding, voting or disposing of any
securities of the Company; provided, however, that a Person
shall not be deemed the Beneficial Owner of, or beneficially to
own, any security (A) if such Personal has a right to vote such
security pursuant to an agreement, arrangement or understanding
(whether or not in writing) which (i) arises solely from a
revocable proxy given to such Person in response to a public
proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the
Exchange Act and (2) is not also then reportable on Schedule
13D under the Exchange Act (or any comparable or successor
report), or (B) if such beneficial ownership arises solely as a
result of such Person's status as a "clearing agency," as
defined in Section 3(a)(23) of the Exchange Act; and provided,
further, however, that nothing in this paragraph shall cause a
Person engaged in business as an underwriter of securities to
be the Beneficial Owner of any securities acquired through such
Person's participation in good faith in an underwriting
syndicate pursuant to an agreement to which the Company is a
party until the expiration of 40-calendar days after the date
of such acquisition. The term "Rights" shall mean the rights
to purchase shares of Series A Stock issued pursuant to the
terms of the Rights Agreement. The term "Other Rights" shall
mean the rights to purchase Common Shares of the Corporation
issued pursuant to the terms of the Rights Agreement, dated
October 6, 1987, as from time to time amended or supplemented,
between the Corporation and National City Bank.
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DIVISION D
EXPRESS TERMS OF THE SERIAL PREFERENCE SHARES
Section 1. Serial Preference Shares may be issued
from time to time in one or more series. Subject to the
provisions of this Division D, which apply to all Serial
Preference Shares, the Directors are hereby authorized to adopt
amendments to the Articles of Incorporation in respect of any
unissued or treasury Serial Preference Shares and thereby fix
or change any or all of the express terms of such Serial
Preference Shares as from time to time may be permitted or
required by law, including without limitation the following:
(i) The division of such shares into series and the
designation and authorized number of shares of each series;
(ii) The dividend or distribution rate;
(iii) The dates of payment of dividends or
distributions and the dates from which they are cumulative;
(iv) Liquidation price;
(v) Redemption rights and price;
(vi) Sinking fund requirements;
(vii) Conversion rights; and
(viii) Restrictions on the issuance of shares of any
class or series.
Section 2. The holders of Serial Preference Shares
shall be entitled to one vote for each Serial Preference Share
held by them upon all matters presented to the shareholders
and, except as required by law, the holders of Serial
Preference Shares and the holders of Common Shares (and the
holders of all other shares of voting stock of the Corporation
that vote together as a class with the holders of Common
Shares) shall vote together as one class on all matters.
Section 3. (a) The holders of Serial Preference
Shares shall be entitled to receive dividends, when and as
declared by the Directors, out of the assets of the Corporation
which are by law available for the payment of dividends at the
rate per share per annum as shall have been fixed by the
Directors pursuant to Section 1 of this Division D.
(b) No dividends (other than a dividend payable in
Common Shares) or other distributions shall be paid or declared
on any Common Shares or any other shares ranking junior to the
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Serial Preference Shares (such Common Shares and other shares
ranking junior to the Serial Preference Shares being
hereinafter referred to as "Junior Shares"), nor shall any
Junior Shares be purchased, retired or otherwise acquired by
the Corporation, unless:
(i) all accrued and unpaid dividends on all series
of Serial Preference Shares, including the full dividends
for the current period, shall have been declared and paid
or provision shall have been made for such payment; and
(ii) there shall be no arrearages with respect to the
redemption or sinking fund obligations, if any, of the
Corporation for any series of Serial Preference Shares.
Section 4. In the event of a voluntary or involuntary
dissolution, liquidation or winding up of the affairs of the
Corporation, before any payment shall be made to the holders of
Junior Shares, the holders of the Serial Preference Shares
shall be entitled to be paid from the assets available therefor
the liquidation price fixed by the Directors pursuant to
Section 1 of this Division D and all accrued and unpaid
dividends on the Serial Preference Shares.
Section 5. All Serial Preference Shares shall be
shares "ranking junior to the Serial Preferred Stock" as such
phrase is defined in Division A, Section 8 of the Articles of
Incorporation.
FIFTH: Except as otherwise provided in these Articles
of Incorporation or in the Regulations, the holders of a
majority of the outstanding shares are authorized to take any
action which, but for this provision, would require the vote or
other action of the holders of more than a majority of such
shares.
SIXTH: Except as otherwise provided in these Articles
of Incorporation, the Corporation, by its Board of Directors,
may purchase issued shares, to the extent permitted by law.
SEVENTH:
Section 1. In addition to any affirmative vote
required by law or these Articles of Incorporation, any Related
Party Transaction shall require the affirmative vote of not
less than both a majority of the Corporation's outstanding
Voting Stock and a majority of the portion of the Corporation's
outstanding Voting Stock excluding the Voting Stock owned by
the Related Party involved in the Related Party Transaction.
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Section 2. The provisions of Section 1 of this
Article Seventh shall not be applicable to Related Party
Transactions in which (a) the aggregate amount of the cash and
the fair market value of consideration other than cash received
per share by holders of shares of each class or series of
Voting Stock of the Corporation who receive cash or other
consideration in the Related Party Transaction is not less than
the highest per share price (with appropriate adjustments for
recapitalizations and for stock splits, stock dividends, and
like distributions) paid by the Related Party in acquiring any
of its holdings of each class of series of such Voting Stock,
and (b) the form of consideration received by holders of shares
of each class or series of such Voting Stock is cash or the
same form used by the Related Party to acquire the largest
percentage of each class or series of such Voting Stock owned
by the Related Party.
Section 3. The provisions of Section 1 of this
Article Seventh shall not be applicable if the Continuing
Directors of the Corporation by a majority vote have expressly
approved the Related Party Transaction.
Section 4. For the purpose of this Article Seventh:
(a) The term "Related Party Transaction" shall
mean (i) any merger or consolidation of the
Corporation or a Subsidiary with a Related Party,
irrespective of which party, if either, is the
surviving party, (ii) any sale, purchase, lease,
exchange, transfer, or other transaction (or series of
transactions) between the Corporation or a Subsidiary
and a Related Party involving the acquisition or
disposition of assets for consideration of $10,000,000
or more in value (except for transactions in the
ordinary course of business), (iii) the issuance or
transfer of any securities of the Corporation or of a
Subsidiary to a Related Party (other than an issuance
or transfer of securities which is effected on a pro
rata basis to all shareholders of the Corporation),
(iv) any reclassification of securities of the
Corporation (including any reverse stock split) or any
recapitalization or other transaction involving the
Corporation or its Subsidiaries that would have the
effect of increasing the voting power of a Related
Party, except for any mandatory redemption required by
the terms of outstanding securities, and (v) the
adoption of any plan or proposal for the liquidation
or dissolution of the Corporation in favor of which a
Related Party votes its Voting Stock.
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(b) The term "Related Party" shall mean (i) any
individual, corporation, partnership, or other person,
group or entity which, together with its Affiliates
and Associates, is the beneficial owner of ten percent
(10%) or more but less than ninety percent (90%) of
the Voting Stock of the Corporation or (ii) any such
Affiliate or Associate.
(c) A person shall be a "beneficial owner" of
any shares of Voting Stock:
(i) Which such person or any of its
Affiliates or Associates beneficially owns,
directly or indirectly; or
(ii) Which such person or any of its
Affiliates or Associates has (a) the right to
acquire (whether such right is exercisable
immediately or only after the passage of time)
pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or
otherwise, or (b) the right to vote pursuant to
any agreement, arrangement or understanding; or
(iii) Which are beneficially owned, directly
or indirectly, by any other person with which
such person or any of its Affiliates or
Associates has any agreement, arrangement or
understanding for the purpose of acquiring,
holding, voting or disposing of any shares of
Voting Stock.
(d) The terms "Affiliate" and "Associate" shall
have the respective meanings ascribed to such terms in
Rule 12b-2 of the General Rules and Regulations under
the Securities Act of 1934, as in effect on January 1,
1985 (or any subsequent provisions replacing such Act,
Rules or Regulations).
(e) The term "consideration other than cash" as
used in Section 2(a) of this Article Seventh shall
include, without limitation, Voting Stock of the
Corporation retained by its existing shareholders in
the event of a merger or consolidation with a Related
Party in which the Corporation is the surviving
corporation.
(f) The term "Subsidiary" shall mean any
Affiliate of the Corporation more than fifty percent
(50%) of the outstanding securities of which
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representing the right, other than as affected by
events of default, to vote for the election of
directors is owned by the Corporation or by another
Subsidiary (or both).
(g) The term "Voting Stock" shall mean all
securities of the Corporation entitled to vote
generally in the election of directors.
(h) The term "Continuing Director" shall mean a
director who either (i) was a member of the Board of
Directors of the Corporation immediately prior to the
time that the Related Party involved in a Related
Party Transaction became a Related Party, or (ii) was
designated (before his or her initial election as a
director) as a Continuing Director by a majority of
the then Continuing Directors.
Section 5. A majority of the Continuing Directors
shall have the power and duty to determine conclusively for the
purposes of this Article Seventh, on the basis of information
known to them, (a) whether a person is a Related Party, (b)
whether a person is an Affiliate or Associate of another, (c)
whether a transaction between the Corporation or a Subsidiary
and a Related Party involves the acquisition or disposition of
assets for consideration of $10,000,000 or more in value, (d)
the fair market value of consideration other than cash received
by holders of Voting Stock in a Related Party Transaction, and
(e) such other matters with respect to which a determination or
interpretation is required under this Article Seventh.
Section 6. Nothing contained in this Article Seventh
shall be construed to relieve any related Party from any
fiduciary obligation imposed by law.
Section 7. Notwithstanding any other provisions of
these Articles of Incorporation or the Regulations of the
Corporation or any provision of law which might otherwise
permit a lesser vote, but in addition to any affirmative vote
of the holders of any particular class or series of stock
required by law or these Articles of Incorporation, the
affirmative vote of the holders of at least sixty-six and
two-thirds percent (66-2/3%) of the Corporation's Voting Stock,
voting as a single class, shall be required to alter, amend or
adopt any provision inconsistent with or repeal this Article
Seventh.
EIGHTH:
Section 1. Any direct or indirect purchase or other
acquisition by the Corporation of any shares of Voting Stock
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from any Selling Shareholder who has beneficially owned any of
such shares of Voting Stock for less than two years prior to
the date of such purchase or other acquisition, or any
agreement in respect thereof, shall, except as expressly
provided in Section 2 of this Article Eighth, require the
affirmative vote of the holders of not less than a majority of
the shares of Voting Stock represented in person or by proxy at
a meeting at which a quorum is present, excluding Voting Stock
beneficially owned by such Selling Shareholder, voting together
as a single class. Such affirmative vote shall be required
notwithstanding the fact that no vote may be required, or that
a lesser percentage may be specified by law, or in any
agreement with any national securities exchange or otherwise.
Section 2. The provisions of Section 1 of this
Article Eighth shall not be applicable (a) to any purchase or
other acquisition by the Corporation from a Selling Shareholder
of shares of Voting Stock owned by said Selling Shareholder
which purchase or acquisition is made as part of a tender or
exchange offer by the Corporation to purchase Voting Stock of
the same class or series made on the same terms to all holders
of such Voting Stock and complying with the applicable
requirements of the Securities Exchange Act of 1934 and the
rules and regulations thereunder (or any subsequent provisions
replacing such Act, rules or regulations), or (b) to the
purchase from any Selling Shareholder of shares of Voting Stock
by the Corporation at a price not in excess of the Fair Value
thereof, and any such purchase or acquisition shall require
only such affirmative vote, if any, as is required by law and
any other provisions of these Articles of Incorporation or
otherwise.
Section 3. For the purpose of this Article Eighth:
(a) "Selling Shareholder" shall mean any
individual, firm, partnership, corporation or other
person, group or entity (other than the Corporation or
any corporation of which a majority of its voting
stock is owned, directly or indirectly, by the
Corporation) who or which:
(i) is the beneficial owner of more than
five percent (5%) of the class or series of
Voting Stock to be acquired; or
(ii) is an Affiliate of the Corporation and
at any time within the two-year period
immediately prior to the date in question was the
beneficial owner of more than five percent (5%)
of the class or series of Voting Stock to be
acquired; or
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(iii) is an assignee or has otherwise
succeeded to any shares of the class or series of
Voting Stock to be acquired which were at any
time within the two-year period immediately prior
to the date in question beneficially owned by a
Selling Shareholder, if such assignment or
succession shall have occurred in the course of a
transaction or series of transactions not
involving a public offering within the meaning
of the Securities Act of 1933.
(b) "Affiliate" or "Associate" shall have the
respective meanings ascribed to such terms in Rule
12b-2 of the General Rules and Regulations under the
Securities Act of 1934, as in effect on January 1,
1985 (or any subsequent provisions replacing such Act,
Rules or Regulations).
(c) A person shall be a "beneficial owner" of
any shares of Voting Stock:
(i) Which such person or any of its
Affiliates or Associates beneficially owns,
directly or indirectly; or
(ii) Which such person or any of its
Affiliates or Associates has (a) the right to
acquire (whether such right is exercisable
immediately or only after the passage of time)
pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion
rights, exchange rights, warrants or options, or
otherwise, or (b) the right to vote pursuant to
any agreement, arrangement or understanding; or
(iii) Which are beneficially owned, directly
or indirectly, by any other person with which
such person or any of its Affiliates or
Associates has any agreement, arrangement or
understanding for the purpose of acquiring,
holding, voting or disposing of any shares of
Voting Stock.
(d) For the purpose of determining whether a
person is a Selling Shareholder pursuant to paragraph
(a) of this Section 3, the number of shares of Voting
Stock deemed to be outstanding shall include shares
deemed owned through application of paragraph (c) of
this Section 3, but shall not include any other shares
of Voting Stock which may be issuable pursuant to any
agreement, arrangement or understanding, or upon
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exercise of conversion rights, warrants or options, or
otherwise.
(e) "Voting Stock" shall mean all securities of
the Corporation entitled to vote generally in the
election of directors.
(f) "Fair Value" shall mean the highest closing
sale price of such Voting Stock during the thirty-day
period immediately preceding the date in question, on
the Composite Tape for New York Stock Exchange-Listed
Stocks, or, if such Voting Stock is not quoted on the
Composite Tape, on the New York Stock Exchange, or, if
such Voting Stock is not listed on such Exchange, on
the principal United States securities exchange
registered under the Securities Exchange Act of 1934
on which such Voting Stock is listed, or, if such
Voting Stock is not listed on any such exchange, the
highest closing bid quotation with respect to such
Voting Stock, during the thirty-day period immediately
preceding the date in question, on the National
Association of Securities Dealers, Inc. Automated
Quotations System or any system then in use, or if no
such quotations are available, the Fair Value on the
date in question of such Voting Stock shall be as
determined by a majority of the Board of Directors of
the Corporation in good faith.
Section 4. A majority of the Board of Directors shall
have the power and duty to determine conclusively for the
purposes of this Article Eighth, on the basis of information
known to them, (a) whether a person is a Selling Shareholder,
(b) the Fair Value of Voting Stock owned by a Selling
Shareholder, and (c) such other matters with respect to which a
determination or interpretation is required under this Article
Eighth.
NINTH: No person shall make a Control Share
Acquisition without first obtaining the prior authorization of
the Corporation's shareholders at a special meeting of
shareholders called by the Board of Directors in accordance
with this Article Ninth.
Section 1. PROCEDURE. Any Person who proposes to
make a Control Share Acquisition shall deliver a notice
("Notice") to the Corporation at its principal place of
business that sets forth all of the following information:
(A) The identity of the Person who is giving the
Notice;
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(B) A Statement that the Notice is given
pursuant to this Article Ninth.
(C) The number and class of shares of the
Corporation owned, directly or indirectly, by the
Person who gives the Notice;
(D) The range of voting power (as specified in
Section 6(B)(1)) under which the proposed Control
Share Acquisition would, if consummated, fall;
(E) A description in reasonable detail of the
terms of the proposed Control Share Acquisition; and
(F) Representatives, supported by reasonable
information, that the proposed Control Share
Acquisition would be consummated if shareholder
approval is obtained and, if consummated, would not be
contrary to law and that the Person who is giving the
Notice has the financial capacity to make the proposed
Control Share Acquisition.
Section 2. CALL OF SPECIAL MEETING OF SHAREHOLDERS.
The Board of Directors of the Corporation shall, within ten
(10) days after receipt by the Corporation of a Notice that
complies with Section 1, call a special meeting of shareholders
to be held not later than fifty (50) days after receipt of the
Notice by the Corporation, unless the Person who delivered the
Notice agrees to a later date, to consider the proposed Control
Share Acquisition; provided that the Board of Directors shall
have no obligation to call such a meeting if they make a
determination with ten (10) days after receipt of the Notice
that the proposed Control Share Acquisition could not be
consummated for financial or legal reasons.
The Board of Directors may adjourn such special
meeting of shareholders if prior to such meeting the
Corporation has received a Notice from any other Person and the
Board of Directors has determined that the Control Share
Acquisition proposed by such other Person, or a merger,
consolidation or sale of assets of the Corporation, should be
presented to shareholders at an adjourned meeting or at a
special meeting held at a later date.
For purposes of making a determination that a special
meeting of shareholders should not be allowed pursuant to this
Section 2, no such determination shall be deemed void or
voidable with respect to the Corporation merely because one or
more of its directors or officers who participated in
deliberations regarding such determination may be deemed to be
other than disinterested, if in any such case the material
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facts of the relationship giving rise to a basis for
self-interest are known to the directors and the directors, in
good faith reasonably justified by the facts, make such
determination by the affirmative vote of a majority of the
disinterested directors, even though the disinterested
directors constitute less than a quorum. For purposes of this
paragraph, "disinterested directors" shall mean directors whose
material contacts with the Corporation are limited principally
to activities as a director or shareholder. Persons who have
substantial, recurring business or professional contacts with
the Corporation shall not be deemed to be "disinterested
directors" for purposes of this provision. A director shall
not be deemed to be other than a "disinterested director"
merely because he would no longer be a director if the proposed
Control Share Acquisition were approved and consummated.
Section 3. NOTICE OF SPECIAL MEETING. The
Corporation shall, as promptly as practicable, give notice of
the special meeting of shareholders called pursuant to
Section 2 to all shareholders of record as of the record date
set for such meeting. Such notice shall include or be
accompanied by a copy of the Notice and by a statement of the
Corporation, authorized by the Board of Directors, of its
position or recommendation, or that it is taking no position or
making no recommendation, with respect to the proposed Control
Share Acquisition.
Section 4. REQUIREMENTS FOR APPROVAL. The Person who
delivered the Notice may make the proposed Control Share
Acquisition if both of the following occur:
(A) The Shareholders of the Corporation
authorize such acquisition at the special meeting of
shareholders called pursuant to Section 2, at which
meeting a quorum is present, by the affirmative vote
of a majority of the Voting Stock represented at such
meeting in person or by proxy and by a majority of the
portion of such Voting Stock represented at such
meeting in person or by proxy excluding the votes of
Interested Shares. A quorum shall be deemed to be
present at such special meeting if at least a majority
of the issued and outstanding Voting Stock, and a
majority of such Voting Stock excluding Interested
Shares, are represented at such meeting in person or
by proxy.
(B) Such acquisition is consummated, in
accordance with the terms so authorized, not later
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than three hundred sixty (360) days following
shareholder authorization of the Control Share
Acquisition.
Section 5. VIOLATIONS OF RESTRICTION. Any Voting
Stock issued or transferred to any Person in violation of this
Article Ninth shall hereinafter be called "Excess Shares." In
the event that any Person acquires Excess Shares, then, in
addition to any other remedies which the Corporation may have
at law or in equity as a result of such acquisition, the
Corporation shall have the right to redeem, or to deny voting
rights or other shareholder rights appurtenant to such Excess
Shares. The Corporation additionally shall have the right to
regard the Person who holds Excess Shares as having acted as an
agent on behalf of the Corporation in acquiring the Excess
Shares and to hold such Excess Shares on behalf of the
Corporation. As the equivalent of treasury securities for such
purposes, the Excess Shares shall not be entitled to any voting
rights, shall not be considered to be outstanding for quorum or
voting purposes, and the Person who holds Excess Shares shall
not be entitled to receive dividends, interest or any other
distribution with respect to the Excess Shares. Any Person who
receives dividends, interest or any other distribution with
respect to Excess Shares shall hold the same as agent for the
Corporation and, following a permitted transfer, for the
transferee thereof. Notwithstanding the foregoing, any Person
who holds Excess Shares may transfer the same (together with
any distributions thereon) to any Person who, following such
transfer, would not own shares in violation of this Article
Ninth. Upon such permitted transfer, the Corporation shall pay
or distribute to the transferee any distributions on the Excess
Shares not previously paid or distributed.
Section 6. DEFINITIONS. As used in this Article
Ninth:
(A) "Person" includes, without limitation, an
individual, a corporation (whether nonprofit or for
profit), a partnership, an unincorporated society or
association, and two or more persons having a joint or
common interest.
(B)(1) "Control Share Acquisition" means the
acquisition, directly or indirectly, by any Person, of
shares of the Corporation that, when added to all
other shares of the Corporation in respect of which
such Person, directly or indirectly, may exercise or
direct the exercise of voting power as provided in
this Section 6(B)(1), would entitle such Person,
immediately after such acquisition, directly or
indirectly, to exercise or direct the exercise of
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voting power of the Corporation in the election of
directors within any of the following ranges of such
voting power:
(a) One-fifth or more but less than
one-third of such voting power;
(b) One-third or more but less than a
majority of such voting power; or
(c) A majority or more of such voting power.
A bank, broker, nominee, trustee, or other Person
who acquires shares in the ordinary course of business
for the benefit of others in good faith and not for
the purpose of circumventing this Article Ninth shall,
however, be deemed to have voting power only of shares
in respect of which such Person would be able to
exercise or direct the exercise of votes at a special
meeting of shareholders called pursuant to Section 2
of this Article Ninth without further instruction from
others. For purposes of this Article Ninth, the
acquisition of securities immediately convertible into
shares of the Corporation with voting power in the
election of directors shall be treated as an
acquisition of such shares.
(2) The acquisition of any shares of the
Corporation does not constitute a Control Share
Acquisition for the purposes of this Article Ninth if
the acquisition is consummated in any of the following
circumstances:
(a) By underwriters in good faith and not
for the purpose of circumventing this Article
Ninth in connection with an offering to the
public of securities of the Corporation;
(b) By bequest or inheritance, by operation
of law upon the death of any individual, or by
any other transfer without valuable
consideration, including a gift that is made in
good faith and not for the purpose of
circumventing this Article Ninth;
(c) Pursuant to the satisfaction of a
pledge or other security interest created in good
faith and not for the purpose of circumventing
this Article Ninth;
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(d) Pursuant to a merger, consolidation,
combination or majority share acquisition adopted
or authorized by shareholder vote in compliance
with the provisions of Article Seventh of these
Articles of Incorporation and Section 1701.78 or
1701.83 of the Ohio Revised Code if the
Corporation is the surviving or new corporation
in the merger or consolidation or is the
acquiring corporation in the combination or
majority share acquisition;
(e) Under such circumstances that the
acquisition does not result in the Person
acquiring shares of the Corporation being
entitled, immediately thereafter and for the
first time, directly or indirectly, to exercise
or direct the exercise of voting power of the
Corporation in the election of directors within
the range of one-fifth or more but less than
one-third of such voting power, or within any of
the ranges of voting power specified in Section
6(B)(1)(a), (b) or (c) which is higher than the
range of voting power applicable to such Person
immediately prior to such acquisition;
(f) Prior to [date of the Merger]; or
(g) Pursuant to a contract existing prior
to [date of the Merger].
The acquisition by any Person of shares of the
Corporation in a manner described under this Section
6(B)(2) shall be deemed to be a Control Share
Acquisition authorized pursuant to this Article Ninth
within the range of voting power specified in Section
6(B)(1)(a), (b) or (c) that such Person is entitled to
exercise after such acquisition, provided that, in the
case of an acquisition in a manner described under
Section 6(B)(2)(b) or (c), the transferor of shares to
such Person had previously obtained any authorization
of shareholders required under this Article Ninth in
connection with such transferor's acquisition of
shares of the Corporation.
(3) The acquisition of shares of the Corporation
in good faith and not for the purpose of circumventing
this Article Ninth from any Person whose Control Share
Acquisition had previously been authorized by
shareholders in compliance with this Article Ninth, or
from any Person whose previous acquisition of shares
would have constituted a Control Share Acquisition but
for Section 6(B)(2), does not constitute a Control
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Share Acquisition for the purpose of this Article
Ninth unless such acquisition entitles any Person,
directly or indirectly, alone or with others, to
exercise or direct the exercise of voting power of the
Corporation in the election of directors in excess of
the range of such voting power authorized pursuant to
this Article Ninth, or deemed to be so authorized
under Section 6(B)(2).
(C) "Interested Shares" means Voting Stock with
respect to which any of the following persons may
exercise or direct the exercise of the voting power:
(1) any Person whose Notice prompted the
calling of a special meeting of shareholders
pursuant to Section 2;
(2) any officer of the Corporation elected
or appointed by the directors of the Corporation;
and
(3) any employee of the Corporation who is
also a director of the Corporation.
(D) "Voting Stock" means all securities of the
Corporation entitled to vote generally in the election
of directors, and, for purposes of Section 5 of this
Article Ninth, shall mean securities of the
Corporation immediately convertible into securities
entitled to vote generally in the election of
directors.
Section 7. PROXIES. No proxy appointed for or in
connection with the Shareholder authorization of a Control
Share Acquisition pursuant to this Article Ninth is valid if it
provides that it is irrevocable. No such proxy is valid unless
it is sought, appointed, and received both:
(A) In accordance with all applicable
requirements of law; and
(B) Separate and apart from the sale or
purchase, contract or tender for sale or purchase, or
request or invitation for tender for sale or purchase,
of shares of the Corporation.
Section 8. REVOCABILITY OF PROXIES. Proxies
appointed for or in connection with the shareholder
authorization of a Control Share Acquisition pursuant to this
Article Ninth shall be revocable at all times prior to the
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obtaining of such shareholder authorization, whether or not
coupled with an interest.
Section 9. AMENDMENTS. Notwithstanding any other
provisions of these Articles of Incorporation or the
Regulations of the Corporation or any provision of law that
might otherwise permit a lesser vote, but in addition to any
affirmative vote of the holders of any particular class or
series of stock required by law, the Articles of Incorporation
or the Regulations of the Corporation, the affirmative vote of
the holders of at least sixty-six and two-thirds percent
(66-2/3%) of the Voting Stock, voting as a single class, shall
be required to alter, amend or repeal this Article Ninth or
adopt any provisions in the Articles of Incorporation or
Regulations of the Corporation which are inconsistent with the
provisions of this Article Ninth.
Section 10. LEGEND ON SHARE CERTIFICATES. Each
certificate representing shares of the Corporation's capital
stock shall contain the following legend:
Transfer of the shares represented by this
Certificate is subject to the provisions of Article
Ninth of the Corporation's Articles of Incorporation
as the same may be in effect from time to time. Upon
written request delivered to the Secretary of the
Corporation at its principal place of business, the
Corporation will mail to the holder of this
Certificate a copy of such provisions without charge
within five (5) days after receipt of written request
therefor. By accepting this Certificate the holder
hereof acknowledges that it is accepting same subject
to the provisions of said Article Ninth as the same
may be in effect from time to time and covenants with
the Corporation and each shareholder thereof from time
to time to comply with the provisions of said Article
Ninth as the same may be in effect from time to time.
TENTH: The provisions of Section 1701.831 of the Ohio
Revised Code, as amended from time to time, or any successor
provision or provisions to said Section, shall not apply with
respect to any particular Control Share Acquisition, as such is
defined in said Section, regarding this Corporation so long as
Article Ninth of these Articles of Incorporation, as such
Articles of Incorporation may be amended from time to time,
remains an Article of these Articles of Incorporation and
remains substantially in full force and effect, disregarding
any renumbering of such Article Ninth resulting from any
amendment of these Articles of Incorporation.
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ELEVENTH: These Amended Articles of Incorporation
supersede the existing Amended Articles of Incorporation of the
Corporation.