AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
NATIONSBANK (DE) CORPORATION
NationsBank (DE) Corporation, a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), hereby certifies
that (i) the Certificate of Incorporation of the Corporation was originally
filed on July 31, 1998, (ii) this Amended and Restated Certificate of
Incorporation has been duly adopted in accordance with Sections 242 and 245 of
the General Corporation Law of the State of Delaware, and (iii) the Certificate
of Incorporation of the Corporation is hereby amended to read in its entirety as
follows:
1. The name of the Corporation is NationsBank (DE)
Corporation.
2. The purposes for which the Corporation is organized are to
engage in any lawful act or activity for which corporations may be organized and
incorporated under the General Corporation Law of the State of Delaware.
3. The number of shares, par value $.01 per share, the
Corporation is authorized to issue is Five Billion One Hundred Million
(5,100,000,000), divided into the following classes:
Class Number of Shares
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Common.................................................. 5,000,000,000
Preferred............................................... 100,000,000
The class of common ("Common Stock") has unlimited voting rights
and, after satisfaction of claims, if any, of the holders of preferred shares,
is entitled to receive the net assets of the Corporation upon distribution.
The Board of Directors of the Corporation shall have full power and
authority to establish one or more series within the class of preferred shares
(the "Preferred Shares"), to define the designations, preferences, limitations
and relative rights (including conversion rights) of shares within such class
and to determine all variations between series.
The Board of Directors of the Corporation has designated,
established and authorized the following series of Preferred Shares:
(a) 7% Cumulative Redeemable Preferred Stock, Series B.
A. Designation.
The designation of this series is "7% Cumulative Redeemable
Preferred Stock, Series B" (hereinafter referred to as the "Series B Preferred
Stock") and the number of shares constituting such series is Thirty-Five
Thousand Forty-Five (35,045). Shares of Series B Preferred Stock shall have a
stated value of $100.00 per share.
B. Dividends.
The holders of record of the shares of the Series B Preferred Stock
shall be entitled to receive, when and as declared by the Board of Directors of
the Corporation, out of any funds legally available for such purpose, cumulative
cash dividends at an annual dividend rate per share of 7% of the stated value
thereof, which amount is $7.00 per annum, per share, and no more. Such dividends
shall be payable each calendar quarter at the rate of $1.75 per share on such
dates as shall be fixed by resolution of the Board of Directors of the
Corporation. The date from which dividends on such shares shall be cumulative
shall be the first day after said shares are issued. Accumulations of dividends
shall not bear interest. No cash dividend shall be declared, paid or set apart
for any shares of Common Stock unless all dividends on all shares of the Series
B Preferred Stock at the time outstanding for all past dividend periods and for
the then current dividend shall have been paid, or shall have been declared and
a sum sufficient for the payment thereof, shall have been set apart. Subject to
the foregoing provisions of this paragraph B, cash dividends or other cash
distributions as may be determined by the Board of Directors of the Corporation
may be declared and paid upon the shares of the Common Stock of the Corporation
from time to time out of funds legally available therefor, and the shares of the
Series B Preferred Stock shall not be entitled to participate in any such cash
dividend or other such cash distribution so declared and paid or made on such
shares of Common Stock.
C. Redemption.
From and after October 31, 1988, any holder may, by written request,
call upon the Corporation to redeem all or any part of said holder's shares of
said Series B Preferred Stock at a redemption price of $100.00 per share plus
accumulated unpaid dividends to the date said request for redemption is received
by the Corporation and no more (the "Redemption Price"). Any such request for
redemption shall be accompanied by the certificates for which redemption is
requested, duly endorsed or with appropriate stock power attached, in either
case with signature guaranteed. Upon receipt by the Corporation of any such
request for redemption from any holder of the Series B Preferred Stock, the
Corporation shall forthwith redeem said stock at the Redemption Price, provided
that: (i) full cumulative dividends have been paid or declared and set apart for
payment upon all shares of any series of preferred stock ranking superior to the
Series B Preferred Stock as to dividends or other distributions (collectively
the "Superior Stock"); and (ii) the Corporation is not then in default or in
arrears with respect to any sinking or analogous fund or call for tenders
obligation or agreement for the purchase, redemption or retirement of any shares
of Superior Stock. In the event that, upon receipt of a request for redemption,
either or both of the conditions set forth in clauses (i) and (ii) above are not
met, the Corporation shall forthwith return said request to the submitting
shareholder along with a statement that the Corporation is unable to honor such
request and explanation of the reasons therefor. From and after the receipt by
the Corporation of a request for redemption from any holder of said Series B
Preferred Stock, which request may be honored consistent with the foregoing
provisions, all rights of such holder in the Series B Preferred Stock for which
redemption is requested shall cease and terminate, except only the right to
receive the Redemption Price thereof, but without interest.
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D. Liquidation Preference.
In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of the Series B
Preferred Stock shall be entitled to receive, subject to the provisions of
paragraph G and before any payment shall be made to the holders of the shares of
Common Stock, the amount of $100.00 per share, plus accumulated dividends. After
payment to the holders of the Series B Preferred Stock of the full amount as
aforesaid, the holders of the Series B Preferred Stock as such shall have no
right or claim to any of the remaining assets which shall be distributed ratably
to the holders of the Common Stock. If, upon any such liquidation, dissolution
or winding up, the assets available therefor are not sufficient to permit
payments to the holders of Series B Preferred Stock of the full amount as
aforesaid, then subject to the provisions of paragraph G, the holders of the
Series B Preferred Stock then outstanding shall share ratably in the
distribution of assets in accordance with the sums which would be payable if
such holders were to receive the full amounts as aforesaid.
E. Sinking Fund.
There shall be no sinking fund applicable to the shares of Series B
Preferred Stock.
F. Conversion.
The shares of Series B Preferred Stock shall not be convertible into
any shares of Common Stock or any other class of shares, nor exchanged for any
shares of Common Stock or any other class of shares.
G. Superior Stock.
The Corporation may issue stock with preferences superior or equal
to the shares of the Series B Preferred Stock without the consent of the holders
thereof.
H. Voting Rights.
Each share of the Series B Preferred Stock shall be entitled to
equal voting rights, share for share, with each share of the Common Stock.
(b) ESOP Convertible Preferred Stock, Series C.
The shares of the ESOP Convertible Preferred Stock, Series C, of the
Corporation shall be designated "ESOP Convertible Preferred Stock, Series C,"
and the number of shares constituting such series shall be 3,000,000. The ESOP
Convertible Preferred Stock, Series C, shall hereinafter be referred to as the
"ESOP Preferred Stock."
A. Special Purpose Restricted Transfer Issue.
Shares of ESOP Preferred Stock shall be issued only to a trustee
acting on behalf of an employee stock ownership plan or other employee benefit
plan of the Corporation or any subsidiary of the Corporation. In the event of
any transfer of shares of ESOP Preferred Stock to
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any person other than any such plan trustee or the Corporation, the shares of
ESOP Preferred Stock so transferred, upon such transfer and without any further
action by the Corporation or the holder, shall be automatically converted into
shares of Common Stock on the terms otherwise provided for the conversion of
shares of ESOP Preferred Stock into shares of Common Stock pursuant to paragraph
E hereof and no such transferee shall have any of the voting powers, preferences
and relative, participating, optional or special rights ascribed to shares of
ESOP Preferred Stock hereunder but, rather, only the powers and rights
pertaining to the Common Stock into which such shares of ESOP Preferred Stock
shall be so converted. Certificates representing shares of ESOP Preferred Stock
shall be legended to reflect such restrictions on transfer. Notwithstanding the
foregoing provisions of this paragraph A, shares of ESOP Preferred Stock (i) may
be converted into shares of Common Stock as provided by paragraph E hereof and
the shares of Common Stock issued upon such conversion may be transferred by the
holder thereof as permitted by law and (ii) shall be redeemable by the
Corporation upon the terms and conditions provided by paragraphs F, G and H
hereof.
B. Dividends and Distributions.
(1) Subject to the provisions for adjustment hereinafter set forth,
the holders of shares of ESOP Preferred Stock shall be entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available therefor, cash dividends ("Preferred Dividends") in an amount equal to
$3.30 per share per annum, and no more, payable semi-annually, one-half on the
first day of January and one-half on the first day of July of each year (each a
"Dividend Payment Date") to holders of record at the start of business on such
Dividend Payment Date. Preferred Dividends shall accrue on a daily basis whether
or not the Corporation shall have earnings or surplus at the time, but Preferred
Dividends on the shares of ESOP Preferred Stock for any period less than a full
semi-annual period between Dividend Payment Dates shall be computed on the basis
of a 360-day year of 30-day months. Accumulated but unpaid Preferred Dividends
shall accumulate as of the Dividend Payment Date on which they first become
payable, but no interest shall accrue on accumulated but unpaid Preferred
Dividends.
(2) So long as any ESOP Preferred Stock shall be outstanding, no
dividend shall be declared or paid or set apart for payment on any other series
of stock ranking on a parity with the ESOP Preferred Stock as to dividends,
unless there shall also be or have been declared and paid or set apart for
payment on the ESOP Preferred Stock, like dividends for all dividend payment
periods of the ESOP Preferred Stock ending on or before the dividend payment
date of such parity stock, ratably in proportion to the respective amounts of
dividends accumulated and unpaid through such dividend payment period on the
ESOP Preferred Stock and accumulated and unpaid or payable on such parity stock
through the dividend payment period on such parity stock next preceding such
Dividend Payment Date. In the event that full cumulative dividends on the ESOP
Preferred Stock have not been declared and paid or set apart for payment when
due, the Corporation shall not declare or pay or set apart for payment any
dividends or make any other distributions on, or make any payment on account of
the purchase, redemption or other retirement of any other class of stock or
series thereof of the Corporation ranking, as to dividends or as to
distributions in the event of a liquidation, dissolution or winding-up of the
Corporation, junior to the ESOP Preferred Stock until full cumulative dividends
on the ESOP Preferred Stock shall have been paid or declared and provided for;
provided, however, that the foregoing shall not apply to
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(i) any dividend payable solely in any shares of any stock ranking, as to
dividends or as to distributions in the event of the liquidation, dissolution or
winding-up of the Corporation, junior to the ESOP Preferred Stock, or (ii) the
acquisition of shares of any stock ranking, as to dividends or as to
distributions in the event of a liquidation, dissolution or winding-up of the
Corporation, junior to the ESOP Preferred Stock either (A) pursuant to any
employee or director incentive or benefit plan or arrangement (including any
employment, severance or consulting agreement) of the Corporation or any
subsidiary of the Corporation heretofore or hereafter adopted or (B) in exchange
solely for shares of any other stock ranking junior to the ESOP Preferred Stock.
C. Voting Rights.
The holders of shares of ESOP Preferred Stock shall have the
following voting rights:
(1) The holders of ESOP Preferred Stock shall be entitled to vote on
all matters submitted to a vote of the holders of Common Stock of the
Corporation, voting together with the holders of Common Stock as one class. Each
share of the ESOP Preferred Stock shall be entitled to the number of votes equal
to the number of shares of Common Stock into which such share of ESOP Preferred
Stock could be converted on the record date for determining the shareholders
entitled to vote, rounded to the nearest whole vote; it being understood that
whenever the "Conversion Ratio" (as defined in paragraph E hereof) is adjusted
as provided in paragraph I hereof, the voting rights of the ESOP Preferred Stock
shall also be similarly adjusted.
(2) Except as otherwise required by the General Corporation Law of
the State of Delaware or set forth in paragraph C(l), holders of ESOP Preferred
Stock shall have no special voting rights and their consent shall not be
required for the taking of any corporate action.
D. Liquidation, Dissolution or Winding-Up.
(1) Upon any voluntary or involuntary liquidation, dissolution or
winding-up of the Corporation, the holders of ESOP Preferred Stock shall be
entitled to receive out of the assets of the Corporation which remain after
satisfaction in full of all valid claims of creditors of the Corporation and
which are available for payment to shareholders and subject to the rights of the
holders of any stock of the Corporation ranking senior to or on a parity with
the ESOP Preferred Stock in respect of distributions upon liquidation,
dissolution or winding-up of the Corporation, before any amount shall be paid or
distributed among the holders of Common Stock or any other shares ranking junior
to the ESOP Preferred Stock in respect of the distributions upon liquidation,
dissolution or winding-up of the Corporation, liquidating distributions in the
amount of $42.50 per share, plus an amount equal to all accrued and unpaid
dividends thereon to the date fixed for distribution, and no more. If upon any
liquidation, dissolution or winding-up of the Corporation, the amounts payable
with respect to the ESOP Preferred Stock and any other stock ranking as to any
such distribution on a parity with the ESOP Preferred Stock are not paid in
full, the holders of the ESOP Preferred Stock and such other stock shall share
ratably in any distribution of assets in proportion to the full respective
preferential amounts to which they are entitled. After payment of the full
amount to which they are entitled as provided by the foregoing provisions of
this para-
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graph D(l), the holders of shares of ESOP Preferred Stock shall not be
entitled to any further right or claim to any of the remaining assets of the
Corporation.
(2) Neither the merger or consolidation of the Corporation with or
into any other corporation, nor the merger or consolidation of any other
corporation with or into the Corporation, nor the sale, transfer or lease of all
or any portion of the assets of the Corporation, shall be deemed to be a
dissolution, liquidation or winding-up of the affairs of the Corporation for
purposes of this paragraph D, but the holders of ESOP Preferred Stock shall
nevertheless be entitled in the event of any such merger or consolidation to the
rights provided by paragraph H hereof.
(3) Written notice of any voluntary or involuntary liquidation,
dissolution or winding-up of the Corporation, stating the payment date or dates
when, and the place or places where, the amounts distributable to holders of
ESOP Preferred Stock in such circumstances shall be payable, shall be given by
first-class mail, postage prepaid, mailed not less than twenty (20) days prior
to any payment date stated therein, to the holders of ESOP Preferred Stock, at
the address shown on the books of the Corporation or any transfer agent for the
ESOP Preferred Stock.
E. Conversion into Common Stock.
(1) A holder of shares of ESOP Preferred Stock shall be entitled, at
any time prior to the close of business on the date fixed for redemption of such
shares pursuant to paragraph F, G or H hereof, to cause any or all of such
shares to be converted into shares of Common Stock at a conversion rate equal to
the ratio of 1.0 share of ESOP Preferred Stock to 1.68 shares of Common Stock
(as adjusted as hereinafter provided, the "Conversion Ratio"). The Conversion
Ratio set forth above is subject to adjustment pursuant to this Certificate of
Incorporation.
(2) Any holder of shares of ESOP Preferred Stock desiring to convert
such shares into shares of Common Stock shall surrender the certificate or
certificates representing the shares of ESOP Preferred Stock being converted,
duly assigned or endorsed for transfer to the Corporation (or accompanied by
duly executed stock powers relating thereto), at the principal executive office
of the Corporation or the offices of the transfer agent for the ESOP Preferred
Stock or such office or offices in the continental United States of an agent for
conversion as may from time to time be designated by notice to the holders of
the ESOP Preferred Stock by the Corporation or the transfer agent for the ESOP
Preferred Stock, accompanied by written notice of conversion. Such notice of
conversion shall specify (i) the number of shares of ESOP Preferred Stock to be
converted and the name or names in which such holder wishes the certificate or
certificates for Common Stock and for any shares of ESOP Preferred Stock not to
be so converted to be issued, and (ii) the address to which such holder wishes
delivery to be made of such new certificates to be issued upon such conversion.
(3) Upon surrender of a certificate representing a share or shares
of ESOP Preferred Stock for conversion, the Corporation shall issue and send by
hand delivery (with receipt to be acknowledged) or by first-class mail, postage
prepaid, to the holder thereof or to such holder's designee, at the address
designated by such holder, a certificate or certificates for the number of
shares of Common Stock to which such holder shall be entitled upon conversion.
In the event that there shall have been surrendered a certificate or
certificates representing shares of
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ESOP Preferred Stock, only part of which are to be converted, the Corporation
shall issue and deliver to such holder or such holder's designee a new
certificate or certificates representing the number of shares of ESOP Preferred
Stock which shall not have been converted.
(4) The issuance by the Corporation of shares of Common Stock upon a
conversion of shares of ESOP Preferred Stock into shares of Common Stock made at
the option of the holder thereof shall be effective as of the earlier of (i) the
delivery to such holder or such holder's designee of the certificate or
certificates representing the shares of Common Stock issued upon conversion
thereof or (ii) the commencement of business on the second business day after
the surrender of the certificate or certificates for the shares of ESOP
Preferred Stock to be converted, duly assigned or endorsed for transfer to the
corporation (or accompanied by duly executed stock powers relating thereto) as
provided hereby. On and after the effective date of conversion, the person or
persons entitled to receive the Common Stock issuable upon such conversion shall
be treated for all purposes as the record holder or holders of such shares of
Common Stock, but no allowance or adjustment shall be made in respect of
dividends payable to holders of Common Stock in respect of any period prior to
such effective date. The Corporation shall not be obligated to pay any dividends
which shall have been declared and shall be payable to holders of shares of ESOP
Preferred Stock on a Dividend Payment Date if such Dividend Payment Date for
such dividend shall coincide with or be on or subsequent to the effective date
of conversion of such shares.
(5) The Corporation shall not be obligated to deliver to holders of
ESOP Preferred Stock any fractional share or shares of Common Stock issuable
upon any conversion of such shares of ESOP Preferred Stock, but in lieu thereof
may make a cash payment in respect thereof in any manner permitted by law.
(6) The Corporation shall at all times reserve and keep available
out of its authorized and unissued Common Stock, solely for issuance upon
the conversion of shares of ESOP Preferred Stock as herein provided, free from
any preemptive rights, such number of shares of Common Stock as shall from time
to time be issuable upon the conversion of all shares of ESOP Preferred Stock
then outstanding. The Corporation shall prepare and shall use its best efforts
to obtain and keep in force such governmental or regulatory permits or other
authorizations as may be required by law, and shall comply with all requirements
as to registration or qualification of the Common Stock, in order to enable the
Corporation lawfully to issue and deliver to each holder of record of ESOP
Preferred Stock such number of shares of its Common Stock as shall from time to
time be sufficient to effect the conversion of all shares of ESOP Preferred
Stock then outstanding and convertible into shares of Common Stock.
F. Redemption At the Option of the Corporation.
(1) The ESOP Preferred Stock shall be redeemable, in whole or in
part, at the option of the Corporation at any time, at a redemption price per
share (except as to redemption pursuant to paragraph F(3)) of $42.83 prior to
July 1, 1999 and $42.50 thereafter, plus, in each case, an amount equal to all
accrued and unpaid dividends thereon to the date fixed for redemption. Payment
of the redemption price shall be made by the Corporation in cash or shares of
Common Stock, or a combination thereof, as permitted by paragraph F(5). From and
after the
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date fixed for redemption, dividends on shares of ESOP Preferred Stock called
for redemption will cease to accrue, such shares will no longer be deemed to be
outstanding and all rights in respect of such shares of the Corporation shall
cease, except the right to receive the redemption price. If less than all of the
outstanding shares of ESOP Preferred Stock are to be redeemed, the Corporation
shall either redeem a portion of the shares of each holder determined pro rata
based on the number of shares held by each holder or shall select the shares to
be redeemed by lot, as may be determined by the Board of Directors of the
Corporation.
(2) Unless otherwise required by law, notice of redemption will be
sent to the holders of ESOP Preferred Stock at the address shown on the books of
the Corporation or any transfer agent for the ESOP Preferred Stock by
first-class mail, postage prepaid, mailed not less than twenty (20) days nor
more than sixty (60) days prior to the redemption date. Each such notice shall
state: (i) the redemption date; (ii) the total number of shares of the ESOP
Preferred Stock to be redeemed and, if fewer than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed from such
holder; (iii) the redemption price; (iv) the place or places where certificates
for such shares are to be surrendered for payment of the redemption price; (v)
that dividends on the shares to be redeemed will cease to accrue on such
redemption date; and (vi) the conversion rights of the shares to be redeemed,
the period within which conversion rights may be exercised, and the Conversion
Ratio and number of shares of Common Stock issuable upon conversion of a share
of ESOP Preferred Stock at the time. These notice provisions may be supplemented
if necessary in order to comply with optional redemption provisions for
preferred stock which may be required under the Internal Revenue Code of 1986,
as amended, or the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). Upon surrender of the certificates for any shares so called for
redemption and not previously converted (properly endorsed or assigned for
transfer, if the Board of Directors of the Corporation shall so require and the
notice shall so state), such shares shall be redeemed by the Corporation at the
date fixed for redemption and at the applicable redemption price set forth in
this paragraph F.
(3) In the event of a change in the federal tax law of the United
States of America which has the effect of precluding the Corporation from
claiming any of the tax deductions for dividends paid on the ESOP Preferred
Stock when such dividends are used as provided under Section 404(k)(2) of the
Internal Revenue Code of 1986, as amended and in effect on the date shares of
ESOP Preferred Stock are initially issued, the Corporation may, within 180 days
following the effective date of such tax legislation and implementing
regulations of the Internal Revenue Service, if any, in its sole discretion and
notwithstanding anything to the contrary in paragraph F(l), elect to redeem any
or all such shares for the amount payable in respect of the shares upon
liquidation of the Corporation pursuant to paragraph D.
(4) In the event the C&S/Sovran Retirement Savings, ESOP and Profit
Sharing Plan (as amended, together with any successor plan, the "Plan") is
terminated, the Corporation shall, notwithstanding anything to the contrary in
paragraph F(l), redeem all shares of ESOP Preferred Stock for the amount payable
in respect of the shares upon redemption of the ESOP Preferred Stock pursuant to
paragraph F(1) hereof.
(5) The Corporation, at its option, may make payment of the
redemption price required upon redemption of shares of ESOP Preferred Stock in
cash or in shares of Common
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Stock, or in a combination of such shares and cash, any such shares to be valued
for such purpose at their Fair Market Value (as defined in paragraph I(7)
hereof).
G. Other Redemption Rights.
Shares of ESOP Preferred Stock shall be redeemed by the Corporation
at a price which is the greater of the Conversion Value (as defined in paragraph
I) of the ESOP Preferred Stock on the date fixed for redemption or a redemption
price of $42.50 per share plus accrued and unpaid dividends thereon to the date
fixed for redemption, for shares of Common Stock (any such shares of Common
Stock to be valued for such purpose as provided by paragraph F(5) hereof), at
the option of the holder, at any time and from time to time upon notice to the
Corporation given not less than five (5) business days prior to the date fixed
by the Corporation in such notice for such redemption, when and to the extent
necessary (i) to provide for distributions required to be made under, or to
satisfy an investment election provided to participants in accordance with, the
Plan to participants in the Plan or (ii) to make payment of principal, interest
or premium due and payable (whether as scheduled or upon acceleration) on any
indebtedness incurred by the holder or Trustee under the Plan for the benefit of
the Plan.
H. Consolidation, Merger, etc.
(1) In the event that the Corporation shall consummate any
consolidation or merger or similar transaction, however named, pursuant to which
the outstanding shares of Common Stock are by operation of law exchanged solely
for or changed, reclassified or converted solely into stock of any successor or
resulting company (including the Corporation and any company that directly or
indirectly owns all of the outstanding capital stock of such successor or
resulting company) that constitutes "qualifying employer securities" with
respect to a holder of ESOP Preferred Stock within the meaning of Section 409(1)
of the Internal Revenue Code of 1986, as amended, and Section 407(d)(5) of
ERISA, or any successor provisions of law, and, if applicable, for a cash
payment in lieu of fractional shares, if any, the shares of ESOP Preferred Stock
of such holder shall be assumed by and shall become preferred stock of such
successor or resulting company, having in respect of such company insofar as
possible the same powers, preferences and relative, participating, optional or
other special rights (including the redemption rights provided by paragraphs F,
G and H hereof), and the qualifications, limitations or restrictions thereon,
that the ESOP Preferred Stock had immediately prior to such transaction, except
that after such transaction each share of the ESOP Preferred Stock shall be
convertible, otherwise on the terms and conditions provided by paragraph E
hereof, into the qualifying employer securities so receivable by a holder of the
number of shares of Common Stock into which such shares of ESOP Preferred Stock
could have been converted immediately prior to such transaction if such holder
of Common Stock failed to exercise any rights of election to receive any kind or
amount of stock, securities, cash or other property (other than such qualifying
employer securities and a cash payment, if applicable, in lieu of fractional
shares) receivable upon such transaction (provided that, if the kind or amount
of qualifying employer securities receivable upon such transaction is not the
same for each non-electing share, then the kind and amount of qualifying
employer securities receivable upon such transaction for each non-electing share
shall be the kind and amount so receivable per share by a plurality of the
non-electing shares). The rights of the ESOP Preferred Stock as preferred stock
of such successor or resulting company shall successively be subject to
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adjustments pursuant to paragraph I hereof after any such transaction as nearly
equivalent to the adjustments provided for by such paragraph prior to such
transaction. The Corporation shall not consummate any such merger, consolidation
or similar transaction unless all then outstanding shares of the ESOP Preferred
Stock shall be assumed and authorized by the successor or resulting company as
aforesaid.
(2) In the event that the Corporation shall consummate any
consolidation or merger or similar transaction, however named, pursuant to which
the outstanding shares of Common Stock are by operation of law exchanged for or
changed, reclassified or converted into other stock or securities or cash or any
other property, or any combination thereof, other than any such consideration
which is constituted solely of qualifying employer securities (as referred to in
paragraph H(l)) and cash payments, if applicable, in lieu of fractional shares,
all outstanding shares of ESOP Preferred Stock shall, without any action on the
part of the Corporation or any holder thereof (but subject to paragraph H(3)),
be deemed converted by virtue of such merger, consolidation or similar
transaction immediately prior to such consummation into the number of shares of
Common Stock into which such shares of ESOP Preferred Stock could have been
converted at such time, and each share of ESOP Preferred Stock shall, by virtue
of such transaction and on the same terms as apply to the holders of Common
Stock, be converted into or exchanged for the aggregate amount of stock,
securities, cash or other property (payable in like kind) receivable by a holder
of the number of shares of Common Stock into which such shares of ESOP Preferred
Stock could have been converted immediately prior to such transaction if such
holder of Common Stock failed to exercise any rights of election as to the kind
or amount of stock, securities, cash or other property receivable upon such
transaction (provided that, if the kind or amount of stock, securities, cash or
other property receivable upon such transaction is not the same for each
non-electing share, then the kind and amount of stock, securities, cash or other
property receivable upon such transaction for each non-electing share shall be
the kind and amount so receivable per share by a plurality of the non-electing
shares).
(3) In the event the Corporation shall enter into any agreement
providing for any consolidation or merger or similar transaction described in
paragraph H(2), then the Corporation shall as soon as practicable thereafter
(and in any event at least ten (10) business days before consummation of such
transaction) give notice of such agreement and the material terms thereof to
each holder of ESOP Preferred Stock and each such holder shall have the right to
elect, by written notice to the Corporation, to receive, upon consummation of
such transaction (if and when such transaction is consummated), from the
Corporation or the successor of the Corporation, in redemption and retirement of
such ESOP Preferred Stock, a cash payment equal to the amount payable in respect
of shares of ESOP Preferred Stock upon redemption pursuant to paragraph F(l)
hereof. No such notice of redemption shall be effective unless given to the
Corporation prior to the close of business on the second business day prior to
consummation of such transaction, unless the Corporation or the successor of the
Corporation shall waive such prior notice, but any notice of redemption so given
prior to such time may be withdrawn by notice of withdrawal given to the
Corporation prior to the close of business on the second business day prior to
consummation of such transaction.
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I. Anti-dilution Adjustments.
(1) In the event the Corporation shall, at any time or from time to
time while any of the shares of the ESOP Preferred Stock are outstanding, (i)
pay a dividend or make a distribution in respect of the Common Stock in shares
of Common Stock, (ii) subdivide the outstanding shares of Common Stock, or (iii)
combine the outstanding shares of Common Stock into a smaller number of shares,
in each case whether by reclassification of shares, recapitalization of the
Corporation (including a recapitalization effected by a merger or consolidation
to which paragraph H hereof does not apply) or otherwise, the Conversion Ratio
in effect immediately prior to such action shall be adjusted by multiplying such
Conversion Ratio by the fraction the numerator of which is the number of shares
of Common Stock outstanding immediately before such event and the denominator of
which is the number of shares of Common Stock outstanding immediately after such
event. An adjustment made pursuant to this paragraph I(1) shall be given effect,
upon payment of such a dividend or distribution, as of the record date for the
determination of shareholders entitled to receive such dividend or distribution
(on a retroactive basis) and in the case of a subdivision or combination shall
become effective immediately as of the effective date thereof.
(2) In the event that the Corporation shall, at any time or from
time to time while any of the shares of ESOP Preferred Stock are outstanding,
issue to holders of shares of Common Stock as a dividend or distribution,
including by way of a reclassification of shares or a recapitalization of the
Corporation, any right or warrant to purchase shares of Common Stock (but not
including as such a right or warrant any security convertible into or
exchangeable for shares of Common Stock) at a purchase price per share less than
the Fair Market Value (as hereinafter defined) of a share of Common Stock on the
date of issuance of such right or warrant, then, subject to the provisions of
paragraphs I(5) and I(6), the Conversion Ratio shall be adjusted by multiplying
such Conversion Ratio by the fraction the numerator of which shall be the number
of shares of Common Stock outstanding immediately before such issuance of rights
or warrants plus the number of shares of Common Stock which could be purchased
at the Fair Market Value of a share of Common Stock at the time of such issuance
for the maximum aggregate consideration payable upon exercise in full of all
such rights or warrants and the denominator of which shall be the number of
shares of Common Stock outstanding immediately before such issuance of rights or
warrants plus the maximum number of shares of Common Stock that could be
acquired upon exercise in full of all such rights and warrants.
(3) In the event the Corporation shall, at any time and from time to
time while any of the shares of ESOP Preferred Stock are outstanding, issue,
sell or exchange shares of Common Stock (other than pursuant to any right or
warrant to purchase or acquire shares of Common Stock (including as such a right
or warrant any security convertible into or exchangeable for shares of Common
Stock) and other than pursuant to any dividend reinvestment plan or employee or
director incentive or benefit plan or arrangement, including any employment,
severance or consulting agreement, of the Corporation or any subsidiary of the
Corporation heretofore or hereafter adopted) for a consideration having a Fair
Market Value on the date of such issuance, sale or exchange less than the Fair
Market Value of such shares on the date of such issuance, sale or exchange,
then, subject to the provisions of paragraphs I(5) and (6), the Conversion Ratio
shall be adjusted by multiplying such Conversion Ratio by the fraction the
numerator of which shall be the sum of (i) the Fair Market Value of all the
shares of Common Stock outstanding on the day
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immediately preceding the first public announcement of such issuance, sale or
exchange plus (ii) the Fair Market Value of the consideration received by the
Corporation in respect of such issuance, sale or exchange of shares of Common
Stock, and the denominator of which shall be the product of (i) the Fair Market
Value of a share of Common Stock on the day immediately preceding the first
public announcement of such issuance, sale or exchange multiplied by (ii) the
sum of the number of shares of Common Stock outstanding on such day plus the
number of shares of Common Stock so issued, sold or exchanged by the
Corporation. In the event the Corporation shall, at any time or from time to
time while any shares of ESOP Preferred Stock are outstanding, issue, sell or
exchange any right or warrant to purchase or acquire shares of Common Stock
(including as such a right or warrant any security convertible into or
exchangeable for shares of Common Stock), other than any such issuance to
holders of shares of Common Stock as a dividend or distribution (including by
way of a reclassification of shares or a recapitalization of the Corporation)
and other than pursuant to any dividend reinvestment plan or employee or
director incentive or benefit plan or arrangement (including any employment,
severance or consulting agreement) of the Corporation or any subsidiary of the
Corporation heretofore or hereafter adopted, for a consideration having a Fair
Market Value on the date of such issuance, sale or exchange less than the
Non-Dilutive Amount (as hereinafter defined), then, subject to the provisions of
paragraphs I(5) and (6), the Conversion Ratio shall be adjusted by multiplying
such Conversion Ratio by a fraction the numerator of which shall be the sum of
(a) the Fair Market Value of all the shares of Common Stock outstanding on the
day immediately preceding the first public announcement of such issuance, sale
or exchange plus (b) the Fair Market Value of the consideration received by the
Corporation in respect of such issuance, sale or exchange of such right or
warrant plus (c) the Fair Market Value at the time of such issuance of the
consideration which the Corporation would receive upon exercise in full of all
such rights or warrants, and the denominator of which shall be the product of
(a) the Fair Market Value of a share of Common Stock on the day immediately
preceding the first public announcement of such issuance, sale or exchange
multiplied by (b) the sum of the number of shares of Common Stock outstanding on
such day plus the maximum number of shares of Common Stock which could be
acquired pursuant to such right or warrant at the time of the issuance, sale or
exchange of such right or warrant (assuming shares of Common Stock could be
acquired pursuant to such right or warrant at such time).
(4) In the event the Corporation shall, at any time or from time to
time while any of the shares of ESOP Preferred Stock are outstanding, make any
Extraordinary Distribution (as hereinafter defined) in respect of the Common
Stock, whether by dividend, distribution, reclassification of shares or
recapitalization of the Corporation (including a recapitalization or
reclassification effected by a merger or consolidation to which paragraph H
hereof does not apply) or effect a Pro Rata Repurchase (as hereinafter defined)
of Common Stock, the Conversion Ratio in effect immediately prior to such
Extraordinary Distribution or Pro Rata Repurchase shall, subject to paragraphs
I(5) and (6), be adjusted by multiplying such Conversion Ratio by a fraction the
numerator of which shall be (a) the product of (i) the number of shares of
Common Stock outstanding immediately before such Extraordinary Distribution or
Pro Rata Repurchase multiplied by (ii) the Fair Market Value (as herein defined)
of a share of Common Stock on the Valuation Date (as hereinafter defined) with
respect to an Extraordinary Distribution, or on the applicable expiration date
(including all extensions thereof) of any tender offer which is a Pro Rata
Repurchase, or on the date of purchase with respect to any Pro Rata Repurchase
which is not a tender
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offer, as the case may be, minus (b) the Fair Market Value of the Extraordinary
Distribution or the aggregate purchase price of the Pro Rata Repurchase, as the
case may be, and the denominator of which shall be the product of (i) the number
of shares of Common Stock outstanding immediately before such Extraordinary
Distribution or Pro Rata Repurchase minus, in the case of a Pro Rata Repurchase,
the number of shares of Common Stock repurchased by the Corporation multiplied
by (ii) the Fair Market Value of a share of Common Stock on the record date with
respect to an Extraordinary Distribution or on the applicable expiration date
(including all extensions thereof) of any tender offer which is a Pro Rata
Repurchase or on the date of purchase with respect to any Pro Rata Repurchase
which is not a tender offer, as the case may be. The Corporation shall send each
holder of ESOP Preferred Stock (x) notice of its intent to make any
Extraordinary Distribution and (y) notice of any offer by the Corporation to
make a Pro Rata Repurchase, in each case at the same time as, or as soon as
practicable after, such offer is first communicated (including by announcement
of a record date in accordance with the rules of any stock exchange on which the
Common Stock is listed or admitted to trading) to holders of Common Stock. Such
notice shall indicate the intended record date and the amount and nature of such
dividend or distribution, or the number of shares subject to such offer for a
Pro Rata Repurchase and the purchase price payable by the Corporation pursuant
to such offer, as well as the Conversion Ratio and the number of shares of
Common Stock into which a share of ESOP Preferred Stock may be converted at such
time.
(5) Notwithstanding any other provisions of this paragraph I, the
Corporation shall not be required to make any adjustment of the Conversion Ratio
unless such adjustment would require an increase or decrease of at least one
percent (1%) in the Conversion Ratio. Any lesser adjustment shall be carried
forward and shall be made no later than the time of, and together with, the next
subsequent adjustment which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at least one percent
(1%) in the Conversion Ratio.
(6) If the Corporation shall make any dividend or distribution on
the Common Stock or issue any Common Stock, other capital stock or other
security of the Corporation or any rights or warrants to purchase or acquire any
such security, which transaction does not result in an adjustment to the
Conversion Ratio pursuant to the foregoing provisions of this paragraph I, the
Board of Directors of the Corporation shall consider whether such action is of
such a nature that an adjustment to the Conversion Ratio should equitably be
made in respect of such transaction. If in such case the Board of Directors of
the Corporation determines that the adjustment to the Conversion Ratio should be
made, an adjustment shall be made effective as of such date, as determined by
the Board of Directors of the Corporation. The determination of the Board of
Directors of the Corporation as to whether an adjustment to the Conversion Ratio
should be made pursuant to the foregoing provisions of this paragraph I(6), and,
if so, as to what adjustment should be made and when, shall be final and binding
on the Corporation and all shareholders of the Corporation. The Corporation
shall be entitled to make such additional adjustments in the Conversion Ratio,
in addition to those required by the foregoing provisions of this paragraph I,
as shall be necessary in order that any dividend or distribution in shares of
capital stock of the Corporation, subdivision, reclassification or combination
of shares of stock of the Corporation or any recapitalization of the Corporation
shall not be taxable to holders of the Common Stock.
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(7) For purposes of this paragraph I, the following definitions
shall apply:
"Conversion Value" shall mean the Fair Market Value of
the aggregate number of shares of Common Stock into which a share of
ESOP Preferred Stock is convertible.
"Extraordinary Distribution" shall mean any dividend or other
distribution (effected while any of the shares of ESOP Preferred
Stock are outstanding) (a) of cash, where the aggregate amount of
such cash dividend and distribution together with the amount of all
cash dividends and distributions made during the preceding period of
12 months, when combined with the aggregate amount of all Pro Rata
Repurchases (for this purpose, including only that portion of the
aggregate purchase price of such Pro Rata Repurchase which is in
excess of the Fair Market Value of the Common Stock repurchased as
determined on the applicable expiration date (including all
extensions thereof) of any tender offer or exchange offer which is a
Pro Rata Repurchase, or the date of purchase with respect to any
other Pro Rata Repurchase which is not a tender offer or exchange
offer made during such period), exceeds Twelve and One-Half percent
(12.5%) of the aggregate Fair Market Value of all shares of Common
Stock outstanding on the record date for determining the
shareholders entitled to receive such Extraordinary Distribution and
(b) any shares of capital stock of the Corporation (other than
shares of Common Stock), other securities of the Corporation (other
than securities of the type referred to in paragraph I(2)), evidence
of indebtedness of the Corporation or any other person or any other
property (including shares of any subsidiary of the Corporation), or
any combination thereof. The Fair Market Value of an Extraordinary
Distribution for purposes of paragraph I(4) shall be the sum of the
Fair Market Value of such Extraordinary Distribution plus the amount
of any cash dividends which are not Extraordinary Distributions made
during such twelve-month period and not previously included in the
calculation of an adjustment pursuant to paragraph I(4).
"Fair Market Value" shall mean, as to shares of Common Stock
or any other class of capital stock or securities of the Corporation
or any other issuer which are publicly traded, the average of the
Current Market Prices (as hereinafter defined) of such shares or
securities for each day of the Adjustment Period (as hereinafter
defined). "Current Market Price" of publicly traded shares of Common
Stock or any other class of capital stock or other security of the
Corporation or any other issuer for a day shall mean the last
reported sales price, regular way, or, in case no sale takes place
on such day, the average of the reported closing bid and asked
prices, regular way, in either case as reported on the New York
Stock Exchange Composite Tape or, if such security is not listed or
admitted to trading on the New York Stock Exchange, on the principal
national securities exchange on which such security is listed or
admitted to trading or, if not listed or admitted to trading on any
national securities exchange, on The Nasdaq National Market or, if
such security is not quoted on Nasdaq, the average of the closing
bid and asked prices on each such day in the over-the-counter market
as reported by
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Nasdaq or, if bid and asked prices for such security on each
such day shall not have been reported through Nasdaq, the average
of the bid and asked prices for such day as furnished by any
New York Stock Exchange member firm selected for such purpose by the
Board of Directors of the Corporation or a committee thereof on each
trading day during the Adjustment Period. "Adjustment Period" shall
mean the period of five (5) consecutive trading days preceding the
date as of which the Fair Market Value of a security is to be
determined. The "Fair Market Value" of any security which is not
publicly traded or of any other property shall mean the fair value
thereof as determined by an independent investment banking or
appraisal firm experienced in the valuation of such securities or
property selected in good faith by the Board of Directors of the
Corporation or a committee thereof, or, if no such investment
banking or appraisal firm is in the good faith judgment of the Board
of Directors or such committee available to make such determination,
as determined in good faith by the Board of Directors of the
Corporation or such committee.
"Non-Dilutive Amount" in respect of an issuance, sale or
exchange by the Corporation of any right or warrant to purchase or
acquire shares of Common Stock (including any security convertible
into or exchangeable for shares of Common Stock) shall mean the
remainder of (a) the product of the Fair Market Value of a share of
Common Stock on the day preceding the first public announcement of
such issuance, sale or exchange multiplied by the maximum number of
shares of Common Stock which could be acquired on such date upon the
exercise in full of such rights and warrants (including upon the
conversion or exchange of all such convertible or exchangeable
securities), whether or not exercisable (or convertible or
exchangeable) at such date, minus (b) the aggregate amount payable
pursuant to such right or warrant to purchase or acquire such
maximum number of shares of Common Stock; provided, however, that in
no event shall the Non-Dilutive Amount be less than zero. For
purposes of the foregoing sentence, in the case of a security
convertible into or exchangeable for shares of Common Stock, the
amount payable pursuant to a right or warrant to purchase or acquire
shares of Common Stock shall be the Fair Market Value of such
security on the date of the issuance, sale or exchange of such
security by the Corporation.
"Pro Rata Repurchase" shall mean any purchase of shares of
Common Stock by the Corporation or any subsidiary thereof, whether
for cash, shares of capital stock of the Corporation, other
securities of the Corporation, evidences of indebtedness of the
Corporation or any other person or any other property (including
shares of a subsidiary of the Corporation), or any combination
thereof, effected while any of the shares of ESOP Preferred Stock
are outstanding, pursuant to any tender offer or exchange offer
subject to Section 13(e) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or any successor provision of law, or
pursuant to any other offer available to substantially all holders
of Common Stock; provided, however, that no purchase of shares by
the Corporation or any subsidiary thereof made in open market
transactions shall be deemed a
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Pro Rata Repurchase. For purposes of this paragraph I(7),
shares shall be deemed to have been purchased by the Corporation
or any subsidiary thereof "in open market transactions" if
they have been purchased substantially in accordance with
the requirements of Rule 10b-18 as in effect under the
Exchange Act, on the date shares of ESOP Preferred Stock are
initially issued by the Corporation or on such other terms and
conditions as the Board of Directors of the Corporation or a
committee thereof shall have determined are reasonably designed to
prevent such purchases from having a material effect on the trading
market for the Common Stock.
"Valuation Date" with respect to an Extraordinary Distribution
shall mean the date that is five (5) business days prior to the
record date for such Extraordinary Distribution.
(8) Whenever an adjustment to the Conversion Ratio is required
pursuant hereto, the Corporation shall forthwith place on file with the transfer
agent for the Common Stock and the ESOP Preferred Stock if there be one, and
with the Secretary of the Corporation, a statement signed by two officers of the
Corporation, stating the adjusted Conversion Ratio determined as provided herein
and the voting rights (as appropriately adjusted) of the ESOP Preferred Stock.
Such statement shall set forth in reasonable detail such facts as shall be
necessary to show the reason and the manner of computing such adjustment,
including any determination of Fair Market Value involved in such computation.
Promptly after each adjustment to the Conversion Ratio and the related voting
rights of the ESOP Preferred Stock, the Corporation shall mail a notice thereof
to each holder of shares of the ESOP Preferred Stock.
J. Ranking; Retirement of Shares.
(1) The ESOP Preferred Stock shall rank (a) senior to the Common
Stock as to the payment of dividends and the distribution of assets on
liquidation, dissolution and winding-up of the Corporation and (b) unless
otherwise provided in the Articles of Incorporation of the Corporation or an
amendment to such Articles of Incorporation relating to a subsequent series of
Preferred Shares, junior to all other series of Preferred Shares as to the
payment of dividends and the distribution of assets on liquidation, dissolution
or winding-up.
(2) Any shares of ESOP Preferred Stock acquired by the Corporation
by reason of the conversion or redemption of such shares as provided hereby, or
otherwise so acquired, shall be retired as shares of ESOP Preferred Stock and
restored to the status of authorized but unissued shares of Preferred Shares,
undesignated as to series, and may thereafter be reissued as part of a new
series of such Preferred Shares as permitted by law.
K. Miscellaneous.
(1) All notices referred to herein shall be in writing, and all
notices hereunder shall be deemed to have been given upon the earlier of receipt
thereof or three (3) business days after the mailing thereof if sent by
registered mail (unless first-class mail shall be specifically permitted for
such notice under the terms hereof) with postage prepaid, addressed: (a) if to
the Cor-
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poration, to its office at NationsBank Corporate Center, Charlotte, North
Carolina 28255 (Attention: Treasurer) or to the transfer agent for the ESOP
Preferred Stock, or other agent of the Corporation designated as permitted
hereby or (b) if to any holder of the ESOP Preferred Stock or Common Stock, as
the case may be, to such holder at the address of such holder as listed in the
stock record books of the Corporation (which may include the records of any
transfer agent for the ESOP Preferred Stock or Common Stock, as the case may be)
or (c) to such other address as the Corporation or any such holder, as the case
may be, shall have designated by notice similarly given.
(2) The term "Common Stock" as used herein means the Corporation's
Common Stock, as the same existed at the date of filing of the Amendment to the
Corporation's Articles of Incorporation relating to the ESOP Preferred Stock or
any other class of stock resulting from successive changes or reclassification
of such Common Stock consisting solely of changes in par value, or from par
value to no par value. In the event that, at any time as a result of an
adjustment made pursuant to paragraph I hereof, the holder of any share of the
ESOP Preferred Stock upon thereafter surrendering such shares for conversion
shall become entitled to receive any shares or other securities of the
Corporation other than shares of Common Stock, the Conversion Ratio in respect
of such other shares or securities so receivable upon conversion of shares of
ESOP Preferred Stock shall thereafter be adjusted, and shall be subject to
further adjustment from time to time, in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to Common Stock
contained in paragraph I hereof, and the provisions of paragraphs A through H,
J, and K hereof with respect to the Common Stock shall apply on like or similar
terms to any such other shares or securities.
(3) The Corporation shall pay any and all stock transfer and
documentary stamp taxes that may be payable in respect of any issuance or
delivery of shares of ESOP Preferred Stock or shares of Common Stock or other
securities issued on account of ESOP Preferred Stock pursuant hereto or
certificates representing such shares or securities. The Corporation shall not,
however, be required to pay any such tax which may be payable in respect of any
transfer involved in the issuance or delivery of shares of ESOP Preferred Stock
or Common Stock or other securities in a name other than that in which the
shares of ESOP Preferred Stock with respect to which such shares or other
securities are issued or delivered were registered, or in respect of any payment
to any person with respect to any such shares or securities other than a payment
to the registered holder thereof, and shall not be required to make any such
issuance, delivery or payment unless and until the person otherwise entitled to
such issuance, delivery or payment has paid to the Corporation the amount of any
such tax or has established, to the satisfaction of the Corporation, that such
tax has been paid or is not payable.
(4) In the event that a holder of shares of ESOP Preferred Stock
shall not by written notice designate the name in which shares of Common Stock
to be issued upon conversion of such shares should be registered or to whom
payment upon redemption of shares of ESOP Preferred Stock should be made or the
address to which the certificate or certificates representing such shares, or
such payment, should be sent, the Corporation shall be entitled to register such
shares, and make such payment, in the name of the holder of such ESOP Preferred
Stock as shown on the records of the Corporation and to send the certificate or
certificates representing
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such shares, or such payment, to the address of such holder shown on the
records of the Corporation.
(5) The Corporation may appoint, and from time to time discharge and
change, a transfer agent for the ESOP Preferred Stock. Upon any such appointment
or discharge of a transfer agent, the Corporation shall send notice thereof by
first-class mail, postage prepaid, to each holder of record of ESOP Preferred
Stock.
(c) $2.50 Cumulative Convertible Preferred Stock, Series BB.
A. Designation.
The designation of this series is "$2.50 Cumulative Convertible
Preferred Stock, Series BB" (hereinafter referred to as the "Series BB Preferred
Stock"), and the initial number of shares constituting such series shall be
20,000,000, which number may be increased or decreased (but not below the number
of shares then outstanding) from time to time by the Board of Directors. The
Series BB Preferred Stock shall rank prior to each of the Common Stock, the
Series B Preferred Stock and the ESOP Preferred Stock with respect to the
payment of dividends and the distribution of assets.
B. Dividend Rights.
(1) The holders of shares of Series BB Preferred Stock shall be
entitled to receive, when and as declared by the Board of Directors, out of
funds legally available therefor, cumulative preferential cash dividends,
accruing from January 1, 1998, at the annual rate of $2.50 per share, and no
more, payable quarterly on the first day of January, April, July and October of
each year (each of the quarterly periods ending on the last day of March, June,
September and December being hereinafter referred to as a "dividend period").
Dividends on the Series BB Preferred Stock shall first become payable on the
first day of January, April, July or October, as the case may be, next following
the date of issuance; provided, however, that if the first dividend period ends
within 20 days of the date of issuance, such initial dividend shall be payable
at the completion of the first full dividend period.
(2) Dividends on shares of Series BB Preferred Stock shall be
cumulative from January 1, 1998, whether or not there shall be funds legally
available for the payment thereof. Accumulations of dividends on the Series BB
Preferred Stock shall not bear interest. The Corporation shall not (i) declare
or pay or set apart for payment any dividends or distributions on any stock
ranking as to dividends junior to the Series BB Preferred Stock (other than
dividends paid in shares of such junior stock) or (ii) make any purchase or
redemption of, or any sinking fund payment for the purchase or redemption of,
any stock ranking as to dividends junior to the Series BB Preferred Stock (other
than a purchase or redemption made by issue or delivery of such junior stock)
unless all dividends payable on all outstanding shares of Series BB Preferred
Stock for all past dividend periods shall have been paid in full or declared and
a sufficient sum set apart for payment thereof; provided, however, that any
moneys theretofore deposited in any sinking fund with respect to any preferred
stock of the Corporation in compliance with the provisions of such sinking fund
may thereafter be applied to the purchase or redemption of such preferred stock
in
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accordance with the terms of such sinking fund regardless of whether at the
time of such application all dividends payable on all outstanding shares of
Series BB Preferred Stock for all past dividend periods shall have been paid in
full or declared and a sufficient sum set apart for payment thereof.
(3) All dividends declared on shares of Series BB Preferred Stock
and any other class of preferred stock or series thereof ranking on a parity as
to dividends with the Series BB Preferred Stock shall be declared pro rata, so
that the amounts of dividends declared on the Series BB Preferred Stock and such
other preferred stock for the same dividend period, or for the dividend period
of the Series BB Preferred Stock ending within the dividend period of such other
stock, shall, in all cases, bear to each other the same ratio that accrued
dividends on the shares of Series BB Preferred Stock and such other stock bear
to each other.
C. Liquidation Preference.
(1) In the event of any liquidation, dissolution or winding up of
the affairs of the Corporation, whether voluntary or involuntary, the holders of
Series BB Preferred Stock shall be entitled to receive out of the assets of the
Corporation available for distribution to shareholders an amount equal to $25
per share plus an amount equal to accrued and unpaid dividends thereon to and
including the date of such distribution, and no more, before any distribution
shall be made to the holders of any class of stock of the Corporation ranking
junior to the Series BB Preferred Stock as to the distribution of assets.
(2) In the event the assets of the Corporation available for
distribution to shareholders upon any liquidation, dissolution or winding up of
the affairs of the Corporation, whether voluntary or involuntary, shall be
insufficient to pay in full the amounts payable with respect to the Series BB
Preferred Stock and any other shares of preferred stock of the Corporation
ranking on a parity with the Series BB Preferred Stock as to the distribution of
assets, the holders of Series BB Preferred Stock and the holders of such other
preferred stock shall share ratably in any distribution of assets of the
Corporation in proportion to the full respective preferential amounts to which
they are entitled.
(3) The merger or consolidation of the Corporation into or with
any other corporation, the merger or consolidation of any other corporation
into or with the Corporation or the sale of the assets of the Corporation
substantially as an entirety shall not be deemed a liquidation, dissolution or
winding up of the affairs of the Corporation within the meaning of this
paragraph C.
D. Redemption.
(1) The Corporation, at its option, may redeem all or any shares of
the Series BB Preferred Stock at any time at a redemption price (the "Redemption
Price") consisting of the sum of (i) $25 per share and (ii) an amount equal to
accrued and unpaid dividends thereon to and including the date of redemption.
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(2) If less than all the outstanding shares of Series BB Preferred
Stock are to be redeemed, the shares to be redeemed shall be selected pro rata
as nearly as practicable or by lot, as the Board of Directors may determine.
(3) Notice of any redemption shall be given by first class mail,
postage prepaid, mailed not less than 60 nor more than 90 days prior to the date
fixed for redemption to the holders of record of the shares of Series BB
Preferred Stock to be redeemed, at their respective addresses appearing on the
books of the Corporation. Notice so mailed shall be conclusively presumed to
have been duly given whether or not actually received. Such notice shall state:
(1) the date fixed for redemption; (2) the Redemption Price; (3) the right of
the holders of Series BB Preferred Stock to convert such stock into Common Stock
until the close of business on the 15th day prior to the redemption date (or the
next succeeding business day, if the 15th day is not a business day); (4) if
less than all the shares held by such holder are to be redeemed, the number of
shares to be redeemed from such holder; and (5) the place(s) where certificates
for such shares are to be surrendered for payment of the Redemption Price. If
such notice is mailed as aforesaid, and if on or before the date fixed for
redemption funds sufficient to redeem the shares called for redemption are set
aside by the Corporation in trust for the account of the holders of the shares
to be redeemed, notwithstanding the fact that any certificate for shares called
for redemption shall not have been surrendered for cancellation, on and after
the redemption date the shares represented thereby so called for redemption
shall be deemed to be no longer outstanding, dividends thereon shall cease to
accrue, and all rights of the holders of such shares as shareholders of the
corporation shall cease, except the right to receive the Redemption Price,
without interest, upon surrender of the certificate(s) representing such shares.
Upon surrender in accordance with the aforesaid notice of the certificate(s) for
any shares so redeemed (duly endorsed or accompanied by appropriate instruments
of transfer, if so required by the Corporation in such notice), the holders of
record of such shares shall be entitled to receive the Redemption Price, without
interest.
(4) At the option of the Corporation, if notice of redemption is
mailed as aforesaid, and if prior to the date fixed for redemption funds
sufficient to pay in full the Redemption Price are deposited in trust, for the
account of the holders of the shares to be redeemed, with a bank or trust
company named in such notice doing business in the Borough of Manhattan, the
City of New York, State of New York or the City of Charlotte, State of North
Carolina and having capital, surplus and undivided profits of at least $3
million, which bank or trust company also may be the Transfer Agent and/or
Paying Agent for the Series BB Preferred Stock, notwithstanding the fact that
any certificate for shares called for redemption shall not have been surrendered
for cancellation, on and after such date of deposit the shares represented
thereby so called for redemption shall be deemed to be no longer outstanding,
and all rights of the holders of such shares as shareholders of the Corporation
shall cease, except the right of the holders thereof to convert such shares in
accordance with the provisions of paragraph F at any time prior to the close of
business on the 15th day prior to the redemption date (or the next succeeding
business day, if the 15th day is not a business day), and the right of the
holders thereof to receive out of the funds so deposited in trust the Redemption
Price, without interest, upon surrender of the certificate(s) representing such
shares. Any funds so deposited with such bank or trust company in respect of
shares of Series BB Preferred Stock converted before the close of business on
the 15th day prior to the redemption date (or the next succeeding business day,
if the 15th day is not a business day) shall be returned to the Corporation upon
such conversion. Any funds so deposited
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with such a bank or trust company which shall remain unclaimed by the holders of
shares called for redemption at the end of six years after the redemption date
shall be repaid to the Corporation, on demand, and thereafter the holder of any
such shares shall look only to the Corporation for the payment, without
interest, of the Redemption Price.
(5) Any provisions of paragraph D or E to the contrary
notwithstanding, in the event that any quarterly dividend payable on the Series
BB Preferred Stock shall be in arrears and until all such dividends in arrears
shall have been paid or declared and set apart for payment, the Corporation
shall not redeem any shares of Series BB Preferred Stock unless all outstanding
shares of Series BB Preferred Stock are simultaneously redeemed and shall not
purchase or otherwise acquire any shares of Series BB Preferred Stock except in
accordance with a purchase offer made by the Corporation on the same terms to
all holders of record of Series BB Preferred Stock for the purchase of all
outstanding shares thereof.
E. Purchase by the Corporation.
(1) Except as provided in paragraph D(5), the Corporation shall be
obligated to purchase shares of Series BB Preferred Stock tendered by the holder
thereof for purchase hereunder, at a purchase price consisting of the sum of (i)
$25 per share and (ii) an amount equal to accrued and unpaid dividends thereon
to and including the date of purchase. In order to exercise his right to require
the Corporation to purchase his shares of Series BB Preferred Stock, the holder
thereof shall surrender the Certificate(s) therefor duly endorsed if the
Corporation shall so require or accompanied by appropriate instruments of
transfer satisfactory to the Corporation, at the office of the Transfer Agent(s)
for the Series BB Preferred Stock, or at such other office as may be designated
by the Corporation, together with written notice that such holder irrevocably
elects to sell such shares to the Corporation. Shares of Series BB Preferred
Stock shall be deemed to have been purchased by the Corporation immediately
prior to the close of business on the date such shares are tendered for sale to
the Corporation and notice of election to sell the same is received by the
Corporation in accordance with the foregoing provisions. As of such date the
shares so tendered for sale shall be deemed to be no longer outstanding,
dividends thereon shall cease to accrue and all rights of the holder of such
shares as a shareholder of the Corporation shall cease, except the right to
receive the purchase price.
F. Conversion Rights.
The holders of shares of Series BB Preferred Stock shall have the
right, at their option, to convert such shares into shares of Common Stock on
the following terms and conditions:
(1) Shares of Series BB Preferred Stock shall be convertible at any
time into fully paid and nonassessable shares of Common Stock (calculated as to
each conversion to the nearest 1/1,000 of a share) at the initial rate of
6.17215 shares of Common Stock for each share of Series BB Preferred Stock
surrendered for conversion (the "Conversion Rate"). The Conversion Rate shall be
subject to adjustment from time to time as hereinafter provided. No payment or
adjustment shall be made on account of any accrued and unpaid dividends on
shares of Series BB Preferred Stock surrendered for conversion prior to the
record date for the determination of shareholders entitled to such dividends or
on account of any dividends on the Common Stock issued upon such conversion
subsequent to the record date for the determination of
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shareholders entitled to such dividends. If any shares of Series BB Preferred
Stock shall be called for redemption, the right to convert the shares designated
for redemption shall terminate at the close of business on the 15th day prior to
the redemption date (or the next succeeding business day, if the 15th day is not
a business day) unless default be made in the payment of the Redemption Price.
In the event of default in the payment of the Redemption Price, the right to
convert the shares designated for redemption shall terminate at the close of
business on the business day immediately preceding the date that such default is
cured.
(2) In order to convert shares of Series BB Preferred Stock into
Common Stock, the holder thereof shall surrender the certificate(s) therefor,
duly endorsed if the Corporation shall so require, or accompanied by appropriate
instruments of transfer satisfactory to the Corporation, at the office of the
Transfer Agent(s) for the Series BB Preferred Stock, or at such other office as
may be designated by the Corporation, together with written notice that such
holder irrevocably elects to convert such shares. Such notice shall also state
the name(s) and address(es) in which such holder wishes the certificate(s) for
the shares of Common Stock issuable upon conversion to be issued. As soon as
practicable after receipt of the certificate(s) representing the shares of
Series BB Preferred Stock to be converted and the notice of election to convert
the same, the Corporation shall issue and deliver at said office a certificate
or certificates for the number of whole shares of Common Stock issuable upon
conversion of the shares of Series BB Preferred Stock surrendered for
conversion, together with a cash payment in lieu of any fraction of a share, as
hereinafter provided, to the person(s) entitled to receive the same. Shares of
Series BB Preferred Stock shall be deemed to have been converted immediately
prior to the close of business on the date such shares are surrendered for
conversion and notice of election to convert the same is received by the
Corporation in accordance with the foregoing provisions, and the person(s)
entitled to receive the Common Stock issuable upon such conversion shall be
deemed for all purposes as record holder(s) of such Common Stock as of such
date.
(3) No fractional shares of Common Stock shall be issued upon
conversion of any shares of Series BB Preferred Stock. If more than one share of
Series BB Preferred Stock is surrendered at one time by the same holder, the
number of full shares issuable upon conversion thereof shall be computed on the
basis of the aggregate number of shares so surrendered. If the conversion of any
shares of Series BB Preferred Stock results in a fractional share of Common
Stock, the Corporation shall pay cash in lieu thereof in an amount equal to such
fraction multiplied times the closing price of the Common Stock on the date on
which the shares of Series BB Preferred Stock were duly surrendered for
conversion, or if such date is not a trading date, on the next succeeding
trading date. The closing price of the Common Stock for any day shall mean the
last reported sales price regular way on such day or, in case no such sale takes
place on such day, the average of the reported closing bid and asked prices,
regular way, on the New York Stock Exchange, or, if the Common Stock is not then
listed on such Exchange, on the principal national securities exchange on which
the Common Stock is listed for trading, or, if not then listed for trading on
any national securities exchange, the average of the closing bid and asked
prices of the Common Stock as furnished by the National Quotation Bureau, Inc.,
or if the National Quotation Bureau, Inc. ceases to furnish such information, by
a comparable independent securities quotation service.
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(4) In the event the Corporation shall at any time (i) pay a
dividend or make a distribution to holders of Common Stock in shares of Common
Stock, (ii) subdivide its outstanding shares of Common Stock into a larger
number of shares, or (iii) combine its outstanding shares of Common Stock into a
smaller number of shares, the Conversion Rate in effect at the time of the
record date for such dividend or distribution or the effective date of such
subdivision or combination shall be adjusted so that the holder of any shares of
Series BB Preferred Stock surrendered for conversion after such record date or
effective date shall be entitled to receive the number of shares of Common Stock
which he would have owned or have been entitled to receive immediately following
such record date or effective date had such shares of Series BB Preferred Stock
been converted immediately prior thereto.
(5) Whenever the Conversion Rate shall be adjusted as herein
provided (i) the Corporation shall forthwith keep available at the office
of the Transfer Agent(s) for the Series BB Preferred Stock a statement
describing in reasonable detail the adjustment, the facts requiring such
adjustment and the method of calculation used; and (ii) the Corporation shall
cause to be mailed by first class mail, postage prepaid, as soon as practicable
to each holder of record of shares of Series BB Preferred Stock a notice stating
that the Conversion Rate has been adjusted and setting forth the adjusted
Conversion Rate.
(6) In the event of any consolidation of the Corporation with
or merger of the Corporation into any other corporation (other than a merger in
which the Corporation is the surviving corporation) or a sale of the assets of
the Corporation substantially as an entirety, the holder of each share of Series
BB Preferred Stock shall have the right, after such consolidation, merger or
sale to convert such share into the number and kind of shares of stock or other
securities and the amount and kind of property receivable upon such
consolidation, merger or sale by a holder of the number of shares of Common
Stock issuable upon conversion of such share of Series BB Preferred Stock
immediately prior to such consolidation, merger or sale. Provision shall be made
for adjustments in the Conversion Rate which shall be as nearly equivalent as
may be practicable to the adjustments provided for in paragraph F(4). The
provisions of this paragraph F(6) shall similarly apply to successive
consolidations, mergers and sales.
(7) The Corporation shall pay any taxes that may be payable in
respect of the issuance of shares of Common Stock upon conversion of shares of
Series BB Preferred Stock, but the Corporation shall not be required to pay any
taxes which may be payable in respect of any transfer involved in the issuance
of shares of Common Stock in a name other than that in which the shares of
Series BB Preferred Stock so converted are registered, and the Corporation shall
not be required to issue or deliver any such shares unless and until the
person(s) requesting such issuance shall have paid to the Corporation the amount
of any such taxes, or shall have established to the satisfaction of the
Corporation that such taxes have been paid.
(8) The Corporation shall at all times reserve and keep available
out of its authorized but unissued Common Stock the full number of shares of
Common Stock issuable upon the conversion of all shares of Series BB Preferred
Stock then outstanding.
(9) In the event that:
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(i) The Corporation shall declare a dividend or any other
distribution on its Common Stock, payable otherwise than in cash
out of retained earnings; or
(ii) The Corporation shall authorize the granting to the holders
of its Common Stock of rights to subscribe for or purchase any
shares of capital stock of any class or of any other rights; or
(iii) The Corporation shall propose to effect any consolidation
of the Corporation with or merger of the Corporation with or
into any other corporation or a sale of the assets of the
company substantially as an entirety which would result in an
adjustment under paragraph F(6),
the Corporation shall cause to be mailed to the holders of record of Series BB
Preferred Stock at least 20 days prior to the applicable date hereinafter
specified a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution or rights or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights are to be determined or (y) the date on
which such consolidation, merger or sale is expected to become effective, and
the date as of which it is expected that holders of Common Stock of record shall
be entitled to exchange their shares of Common Stock for securities or other
property deliverable upon such consolidation, merger or sale. Failure to give
such notice, or any defect therein, shall not affect the legality or validity of
such dividend, distribution, consolidation, merger or sale.
G. Voting Rights.
Holders of Series BB Preferred Stock shall have no voting rights
except as required by law and as follows: in the event that any quarterly
dividend payable on the Series BB Preferred Stock is in arrears, the holders of
Series BB Preferred Stock shall be entitled to vote together with the holders of
Common Stock at the Corporation's next meeting of shareholders and at each
subsequent meeting of shareholders unless all dividends in arrears have been
paid or declared and set apart for payment prior to the date of such meeting.
For the purpose of this paragraph G, each holder of Series BB Preferred Stock
shall be entitled to cast the number of votes equal to the number of whole
shares of Common Stock into which his Series BB Preferred Stock is then
convertible.
H. Reacquired Shares.
Shares of Series BB Preferred Stock converted, redeemed, or
otherwise purchased or acquired by the Corporation shall be restored to the
status of authorized but unissued shares of preferred stock without designation
as to series.
I. No Sinking Fund.
Shares of Series BB Preferred Stock are not subject to the operation
of a sinking fund.
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4. The address of the Corporation's registered office in the
State of Delaware is Corporation Trust Center, 1209 Orange Street in the City of
Wilmington, County of New Castle. The name of the Corporation's registered agent
at such address is The Corporation Trust Company.
5. No holder of any stock of the Corporation of any class now or
hereafter authorized shall have any preemptive right to purchase, subscribe for,
or otherwise acquire any shares of stock of the Corporation of any class now or
hereafter authorized, or any securities exchangeable for or convertible into any
such shares, or any warrants or other instruments evidencing rights or options
to subscribe for, purchase or otherwise acquire any such shares whether such
shares, securities, warrants or other instruments be unissued, or issued and
thereafter acquired by the Corporation.
6. To the fullest extent permitted by the General Corporation Law of
the State of Delaware, as the same exists or may hereafter be amended, a
director of the Corporation shall not be personally liable to the Corporation,
its shareholders or otherwise for monetary damage for breach of his duty as a
director. Any repeal or modification of this Article shall be prospective only
and shall not adversely affect any limitation on the personal liability of a
director of the Corporation existing at the time of such repeal or modification.
7. In furtherance and not in limitation of the powers conferred by
law, the Board of Directors of the Corporation is expressly authorized and
empowered to make, alter and repeal the By-Laws of the Corporation by a majority
vote at any regular or special meeting of the Board of Directors or by written
consent, subject to the power of the stockholders of the Corporation to alter or
repeal any By-Laws made by the Board of Directors.
8. The Corporation reserves the right at any time from time to time
to amend or repeal any provision contained in this Certificate of Incorporation,
and to add any other provisions authorized by the laws of the State of Delaware
at the time in force; and all rights, preferences and privileges conferred upon
stockholders, directors or any other persons by and pursuant to this Certificate
of Incorporation in its present form or as hereafter amended are granted subject
to the rights reserved in this Article.
9. Unless and except to the extent that the By-Laws of the
Corporation shall so require, the election of directors of the Corporation need
not be by written ballot.
10. Any action required or permitted to be taken by the stockholders
of the Corporation must be effected at a duly called annual or special meeting
of stockholders of the Corporation or may be effected by consent in writing in
lieu of a meeting of such stockholders only if consents are signed by all
stockholders of the Corporation entitled to vote on such action.
IN WITNESS WHEREOF, NationsBank (DE) Corporation has caused this
Restated Certificate of Incorporation to be signed by John E. Mack, its Senior
Vice President, and attested to by James Kiser, its Secretary, this 26th day of
August, 1998.
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NATIONSBANK (DE) CORPORATION
By: /s/ JOHN E. MACK
----------------------
John E. Mack
Senior Vice President
ATTEST:
By: /s/ JAMES KISER
--------------------
James Kiser
Secretary
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