Exhibit 3.1
RESTATED
CERTIFICATE OF INCORPORATION
OF
USX HOLDCO, INC.
The undersigned, Robert M. Stanton, certifies that he is the
President of USX HoldCo, Inc., a corporation organized and existing under
the laws of the State of Delaware (the "Corporation"), and does hereby
further certify as follows:
(1) The name of the Corporation is USX HoldCo, Inc.
(2) The name under which the Corporation was originally
incorporated was USX HoldCo, Inc. and the original Certificate of
Incorporation of the Corporation was filed with the Secretary of
State of the State of Delaware on May 30, 2001.
(3) This Restated Certificate of Incorporation was duly
adopted by in accordance with the provisions of Sections 242 and
245 of the General Corpora tion Law of the State of Delaware.
(4) This Restated Certificate of Incorporation shall
become effective at 8:30 a.m. Eastern Daylight Time on July 2,
2001.
(5) The text of the Restated Certificate of Incorporation
of the Corpo ration as amended hereby is restated to read in its
entirety, as follows:
FIRST: The name of the Corporation (which is hereinafter referred to as the
"Corporation") is
USX CORPORATION
SECOND: Its registered office and place of business in the State
of Delaware is located at 2711 Centerville Road, Suite 400,Wilmington, De.
The registered agent in charge thereof upon whom process against the
Corporation may be served is Corporation Service Company.
THIRD: The purposes of the Corporation are to engage in any lawful
act or activity for which corporations may be organized under the General
Corporation Law of Delaware, and without limiting the foregoing to engage
in integrated steel operations and to develop, mine, produce, manufacture,
construct, transport, buy, hold, sell and generally deal in products,
materials, property, both tangible and intangible, and services of all
kinds.
FOURTH: The total number of shares of capital stock which the
Corporation shall have authority to issue is Eight Hundred Forty Million
(840,000,000), of which Forty Million (40,000,000) shares shall be shares
of Preferred Stock, without par value (hereinafter called "Preferred
Stock"), Five Hundred Fifty Million (550,000,000) shares shall be shares of
a class of common stock designated as USX-Marathon Group Common Stock, par
value $1.00 per share ("Marathon Stock"), Two Hundred Million (200,000,000)
shares shall be shares of a class of common stock designated as USX-U.S.
Steel Group Common Stock, par value $1.00 per share ("Steel Stock") and
Fifty Million (50,000,000) shares shall be shares of a class of common
stock designated as USX-Delhi Group Common Stock, par value $1.00 per share
("Delhi Stock"). The Marathon Stock, the Steel Stock and the Delhi Stock
shall hereinafter collectively be called the "Common Stock."
DIVISION I
The powers and rights of the shares of each class of Common Stock,
and the qualifica tions, limitations or restrictions thereof, are as
follows:
1. Dividend Rights. Subject to the express terms of any
outstanding series of Preferred Stock, dividends may be declared
and paid upon each class of the Common Stock upon the terms
provided for below with respect to each such class solely in the
discretion of the Board of Directors:
(a) Dividends on Marathon Stock. Dividends on
the Marathon Stock may be declared and paid out of funds
of the Corporation legally available therefor.
(b) Dividends on Steel Stock. Dividends on the
Steel Stock may be declared and paid out of the lesser of
(i) funds of the Corporation legally available therefor
and (ii) the Available Steel Dividend Amount.
(c) Dividends on Delhi Stock. Dividends on the
Delhi Stock may be declared and paid only out of the
lesser of (i) funds of the Corporation legally available
therefor and (ii) the Available Delhi Dividend Amount.
(d) Discrimination Between Classes of Common
Stock. The Board of Directors, subject to the provisions
of Sections 1(a), 1(b) and 1(c), may, in its sole
discretion, declare and pay dividends exclusively on any
class or classes of Common Stock in equal or unequal
amounts, notwithstanding the amounts of funds available
for dividends on each class, the respective voting and
liquidation rights of each class, the amount of prior
dividends declared on each class or any other factor.
2. Exchange and Redemption. Shares of each class of
Common Stock are subject to exchange or redemption, as the case
may be, upon the terms provided below with respect to each such
class; provided that no such class may be exchanged or redeemed in
its entirety if all of the other classes have been, or are at the
time being, exchanged or redeemed in their entirety:
(a) Exchange and Redemption of Marathon Stock.
(i) At any time on or after the date on
which the Corporation has transferred all of the
assets and liabilities of the Marathon Group to
a wholly owned subsidiary of the Corporation
(the "Marathon Group Sub sidiary"), the Board of
Directors may, in its sole discretion and by a
majority vote of the directors then in office,
provided that there are funds of the Corporation
legally available therefor, declare that all of
the out standing shares of Marathon Stock shall
be exchanged on an Exchange Date set forth in a
notice to holders of Marathon Stock pursuant to
Section 2(d)(i), for all of the outstanding
shares of common stock of the Marathon Group
Subsidiary, on a pro rata basis, each of which
shall, upon such issuance, be fully paid and
nonassessable.
(ii) After any Exchange Date for
Marathon Stock, any share of Marathon Stock that
is issued on conversion or exercise of any
Convert ible Securities shall, to the extent of
funds of the Corporation legally available
therefor, immediately upon issuance pursuant to
such conversion or exercise and without any
notice or any other action on the part of the
Corporation or its Board of Directors or the
holder of such share of Mara thon Stock, be
redeemed for $.01 in cash.
(b) Exchange and Redemption of Steel Stock.
(i) In the event of the Disposition, in
one transaction or a series of related
transactions, by the Corporation of all or
substantially all of the properties and assets
of the U.S. Steel Group (other than in
connection with the Disposition by the
Corporation of all of its properties and assets
in one transaction) to any person, entity or
group (other than (A) the holders of all
outstanding shares of Steel Stock on a pro rata
basis or (B) any person, entity or group in
which the Corporation, directly or indirectly,
owns a majority equity interest), the
Corporation shall, on or prior to the first
Business Day following the 60th day following
the consummation of such Disposition, either:
(A) subject to paragraph 1(b)
above, declare and pay a dividend in
cash and/or in securities or other
property received as proceeds of such
Disposition to the holders of Steel
Stock in an amount equal to the Net
Proceeds of such Disposition; or
(B) to the extent that there
are funds of the Corporation legally
available therefor, redeem the number
of whole shares of outstanding Steel
Stock that has an aggregate average
Market Value, during the ten-Business
Day period beginning on the first
Business Day following such
consummation, closest to the value of
the Net Proceeds of such Disposition,
for cash and/or securities or other
property received as proceeds of such
Disposition in an amount equal to such
Net Proceeds; or
(C) exchange each outstanding
share of Steel Stock for a number of
fully paid and nonassessable shares of
Marathon Stock or, if there are no
shares of Marathon Stock outstanding on
the Exchange Date and shares of Delhi
Stock are then outstanding, of Delhi
Stock equal to 110% of the average
daily ratio (calculated to the nearest
five decimal places) of the Market
Value of one share of Steel Stock to
the Market Value of one share of
Marathon Stock or one share of Delhi
Stock, as the case may be, during such
ten- Business Day period.
For purposes of this Section 2(b)(i):
(x) as of any date, "substantially all
of the properties and assets of the U.S. Steel
Group" shall mean a portion of such properties
and assets that represents at least 80% of
either of the then-current market value of, or
the aggregate revenues for the immediately
preceding twelve fiscal quarterly periods of the
Corporation derived from, the properties and
assets of the U.S. Steel Group as of such date
(excluding the properties and assets of any
person, entity or group in which the
Corporation, directly or indirectly, owns less
than a majority equity interest);
(y) if immediately after any event, the
Corporation, directly or indirectly, owns less
than a majority equity interest in any person,
entity or group in which the Corporation,
directly or indirectly, owned a majority equity
interest immediately prior to the occurrence of
such event, a Dispo sition of all of the
properties and assets of the U.S. Steel Group
owned by such person, entity or group shall be
deemed to have occurred; and
(z) in the case of a Disposition of
properties and assets in a series of related
transactions, such Disposition shall not be
deemed to have been consummated until the
consummation of the last of such transactions.
(ii) The Board of Directors may, by a
majority vote of the direc tors then in office,
at any time after a dividend or redemption
pursuant to clause (A) or (B), respectively, of
Section 2(b)(i), declare that each of the
remaining outstanding shares of Steel Stock
shall be exchanged, on an Exchange Date set
forth in a notice to holders of Steel Stock
pursuant to Section 2(d)(i), for a number of
full paid and nonassessable shares of Marathon
Stock or, if there are no shares of Marathon
Stock outstanding on such Exchange Date and
shares of Delhi Stock are then outstanding, of
Delhi Stock, equal to 110% of the Market Value
Ratio as of the fifth Business Day prior to the
date such notice is mailed to such holders. For
purposes of the preceding sentence, "Market
Value Ratio," as of any date, shall mean the
highest of the following (calculated to the
nearest five decimal places): (A) the average
ratio of S/X for the five-Business Day period
ending on such date, (B) the quotient of (1) the
sum of (w) four times the average ratio of S/X
for the five-Business Day period ending on such
date, (x) three times the average ratio of S/X
for the next preceding five-Business Day Period,
(y) two times the average ratio of S/X for the
next five preceding five-Business Day period and
(z) the average ratio of S/X for the next
preceding five-Business Day period, divided by
(2) ten and (C) if the dividend pursuant to
clause (A) of Section 2(b)(i) was declared and
paid or the redemption pursuant to (B) of
Section 2(b)(i) was made prior to the
commencement of the most recently completed
fiscal quarter of the Corporation, the average
ration of S/X for such fiscal quarter, where S
is the Market Value of one share of Steel Stock
and X is the Market Value of one share of
Marathon Stock or one share of Delhi Stock, as
the case may be.
(iii) At any time on or after the date
on which the Corporation has transferred all of
the assets and liabilities of the U.S. Steel
Group (and no other assets or liabilities) to a
wholly owned subsidiary of the Corpora tion (the
"U.S. Steel Group Subsidiary"), the Board of
Directors may, in its sole discretion and by a
majority vote of the directors then in office,
provided that there are funds of the Corporation
legally available therefor, declare that all of
the outstanding shares of Steel Stock shall be
exchanged on an Exchange Date set forth in a
notice to holders of Steel Stock pursu ant to
Section 2(d)(i), for all of the outstanding
shares of common stock of the U.S. Steel Group
Subsidiary, on a pro rata basis, each of which
shall, upon such issuance, be fully paid and
nonassessable.
(iv) After any Exchange Date or
Redemption Date on which all outstanding Steel
Stock was exchanged or redeemed, any share of
Steel Stock that is issued on conversion or
exercise of any Convertible Securi ties shall,
immediately upon issuance pursuant to such
conversion or exercise and without any notice or
any other action on the part of the Corporation,
its Board of Directors or the holder of such
share of Steel Stock:
(A) in the event the
then-outstanding Steel Stock was
exchanged for Marathon Stock or Delhi
Stock on such Exchange Date pursuant to
Section 2(b)(i) or 2(b)(ii), be
exchanged for the kind and amount of
shares of capital stock and other
securities and property that a holder
of such Convertible Security would have
been entitled to receive pursuant to
the terms of such Convertible Security
had such terms provided that the
conversion privilege in effect
immediately prior to any exchange by
the Corporation of any of its capital
stock for shares of any other capital
stock of the Corporation would be
adjusted so that the holder of any such
Convertible Security thereafter
surrendered for conversion would be
entitled to receive the number of
shares of capital stock of the
Corporation and other securities and
property he would have owned
immediately following such action had
such Convertible Security been
converted immediately prior thereto; or
(B) in the event the
then-outstanding Steel Stock was
redeemed in whole pursuant to clause
(B) of Section 2(b)(i) or exchanged for
common stock of the U.S. Steel Group
Subsidiary pursuant to Section
2(b)(iii), be redeemed, to the extent
of funds of the Corporation legally
available therefor, for $.01 in cash.
The provisions of clause (A) of this
Section 2(b)(iv) shall not apply to the extent
that equivalent adjustments are otherwise made
! pursuant to the provisions of such Convertible
Securities.
(c) Exchange and Redemption of Delhi Stock.
(i) In the event of the Disposition, in
one transaction or a series of related
transactions, by the Corporation of all or
substantially all of the properties and assets
of the Delhi Group (other than in connection
with the Disposition by the Corporation of all
of its properties and assets in one transaction)
to any person, entity or group (other than (A)
the holders of all outstanding shares of Delhi
Stock on a pro rata basis or (B) any person,
entity or group in which the Corporation,
directly or indirectly, owns a majority equity
interest), the Corporation shall, on or prior to
the first Business Day following the 60th day
following the consummation of such Disposition,
either:
(A) subject to paragraph 1(c)
above, declare and pay a dividend in
cash and/or in securities or other
property received as proceeds of such
Disposition to the holders of Delhi
Stock in an amount equal to the product
of the Delhi Fraction and the Net
Proceeds of such Disposition; or
(B) to the extent that there
are funds of the Corporation legally
available therefor, redeem the number
of whole shares of outstanding Delhi
Stock that has an aggregate average
Market Value, during the ten-Business
Day period beginning on the first
Business Day following such
consummation, closest to the value of
the product of the Delhi Fraction and
the Net Proceeds of such Disposition,
for cash and/or securities or other
property received as proceeds of such
Disposition in an amount equal to such
product; or
(C) exchange each outstanding
share of Delhi Stock for a number of
fully paid and nonassessable shares of
Marathon Stock or, if there are no
shares of Marathon Stock outstanding on
such Exchange Date and shares of Steel
Stock are then outstanding, of Steel
Stock, equal to 110% of the average
daily ratio (calculated to the nearest
five decimal places) of the Market
Value of one share of Delhi Stock to
the Market Value of one share of
Marathon Stock or one share of Steel
Stock, as the case may be, during such
ten- Business Day period.
For purposes of this Section 2(c)(i):
(x) as of any date, "substantially all
of the properties and assets of the Delhi Group"
shall mean a portion of such properties and
assets that represents at least 80% of either of
the then-current market value of, or the
aggregate revenues for the immediately preceding
twelve fiscal quarterly periods of the
Corporation derived from, the properties and
assets of the Delhi Group as of such date
(excluding the properties and assets of any
person, entity or group in which the
Corporation, directly or indirectly, owns less
than a majority equity interest);
(y) if immediately after any event, the
Corporation, directly or indirectly, owns less
than a majority equity interest in any person,
entity or group in which the Corporation,
directly or indirectly, owned a majority equity
interest immediately prior to the occurrence of
such event, a Dispo sition of all of the
properties and assets of the Delhi Group owned
by such person, entity or group shall be deemed
to have occurred; and
(z) in the case of a Disposition of
properties and assets in a series of related
transactions, such Disposition shall not be
deemed to have been consummated until the
consummation of the last of such transactions.
(ii) The Board of Directors may, by a
majority vote of the direc tors then in office,
at any time after a dividend or redemption
pursuant to clause (A) or (B), respectively, of
Section 2(c)(i), declare that each of the
remaining outstanding shares of Delhi Stock
shall be exchanged, on an Exchange Date set
forth in a notice to holders of Delhi Stock
pursuant to Section 2(d)(i), for a number of
fully paid and nonassessable shares of Marathon
Stock or, if there are no shares of Marathon
Stock outstanding on such Exchange Date and
shares of Steel Stock are then outstanding, of
Steel Stock equal to 110% of the Market Value
Ratio as of the fifth Business Day prior to the
date such notice is mailed to such holders.
(iii) The Board of Directors may, by a
majority vote of the directors then in office,
at any time declare that each of the outstanding
shares of Delhi Stock shall be exchanged, on an
Exchange Date set forth in a notice to holders
of Delhi Stock pursuant to Section 2(d)(i), for
a number of fully paid and nonassessable shares
of Marathon Stock or, if there are no shares of
Marathon Stock outstanding on such Exchange
Date, of Steel Stock equal to 115% of the Market
Value Ratio as of the fifth Business Day prior
to the date such notice is mailed to such
holders.
(iv) For purposes of Section 2(c)(ii)
and (iii), the "Market Value Ratio," as of any
date, shall mean the highest of the following
(calculated to the nearest five decimal places):
(A) the average ratio of D/X for the
five-Business Day period, (y) two times the
average ratio of D/X for the next preceding
five-Business Day period ending on such date,
(B) the quotient of (1) the sum of (w) four
times the average ratio of D/X for the
five-Business Day period ending on such date,
(x) three times the average ratio of D/X for the
next preceding five Business-Day period and (z)
the average ratio of D/X for the next preceding
five-Business Day period, divided by (2) ten and
(C) if the dividend pursuant to clause (A) of
Section 2(c)(i) was declared and paid or the
redemption pursuant to clause (B) of Section
2(c)(i) was made prior to the commencement of
the most recently completed fiscal quarter of
the Corporation, the average ratio of D/X for
such fiscal quarter, where D is the Market Value
of one share of Delhi Stock and X is the Market
Value of one share of Marathon Stock or one
share of Steel Stock, as the case may be.
(v) At any time on or after the date on
which the Corporation has transferred all of the
assets and liabilities of the Delhi Group (and
no other assets or liabilities) to a wholly
owned subsidiary of the Corporation (the "Delhi
Group Subsidiary"), the Board of Directors may,
in its sole discre tion and by a majority vote
of the directors then in office, provided that
there are funds of the Corporation legally
available therefor, declare that all of the
outstanding shares of Delhi Stock shall be
exchanged on an Exchange Date set forth in a
notice to holders of Delhi Stock pursuant to
Section 2(d)(i), for a number of outstanding
shares of common stock of the Delhi Group
Subsidiary equal to the product of the Delhi
Fraction and the number of all outstanding
shares of common stock of the Delhi Group
Subsidiary, on a pro rata basis, each of which
shall, upon such issuance, be fully paid and
nonassessable.
(vi) After any Exchange Date or
Redemption Date on which all outstanding Delhi
Stock was exchanged or redeemed, any share of
! Delhi Stock that is issued on conversion or
exercise of any Convertible Securi ties shall,
immediately upon issuance pursuant to such
conversion or exercise and without any notice or
any other action on the part of the Corporation
or its Board of Directors or the holder of such
share of Delhi Stock:
(A) in the event the
then-outstanding Delhi Stock was
exchanged for Marathon Stock or Steel
Stock on such Exchange Date pursuant to
Section 2(c)(i), 2(c)(ii) or 2(c)(iii),
be exchanged for the kind and amount of
shares of capital stock and other
securi ties and property that a holder
of such Convertible Security would have
been entitled to receive pursuant to
the terms of such Con vertible Security
had such terms provided that the
conversion privilege in effect
immediately prior to any exchange by
the Cor poration of any of its capital
stock for shares of any other capital
stock of the Corporation would be
adjusted so that the holder of any such
Convertible Security thereafter
surrendered for conver sion would be
entitled to receive the number of
shares of capital stock of the
Corporation and other securities and
property he would have owned
immediately following such action had
such Convertible Security been
converted immediately prior thereto; or
(B) in the event the
then-outstanding Delhi Stock was
redeemed in whole pursuant to clause
(B) of Section 2(c)(i) or exchanged for
common stock of the Delhi Group
Subsidiary pursuant to Section 2(c)(v),
be redeemed, to the extent of funds of
the Corporation legally available
therefor, for $.01 in cash.
The provisions of clause (A) of this
Section 2(c)(vi) shall not apply to the extent
that equivalent adjustments are otherwise made
pursuant to the provisions of such Convertible
Securities.
(d) General Exchange and Redemption Provisions.
(i) In the event of any exchange or
redemption pursuant to this Section 2 (other
than Section 2(a)(ii), 2(b)(iv) or 2(c)(vi), the
Corporation shall cause to be given to each
holder of the class of Common Stock to be so
exchanged or redeemed a notice stating (A) that
shares of such class of Common Stock shall be
exchanged or redeemed, as the case may be, (B)
the Exchange Date or the Redemption Date, (C) in
the event of a partial redemption of Steel Stock
or Delhi Stock, as the case may be, pursuant to
clause (B) of Section 2(b)(i) or clause (B) of
Section 2(c)(i), respectively, the number of
shares of Steel Stock or Delhi Stock, as the
case may be, to be redeemed, (D) the kind and
amount of shares of capital stock or cash and/or
securities or other property to be received by
such holder with respect to each share of such
class of Common Stock held by such holder,
including details as to the calculation thereof,
(E) the place or places where certificates for
shares of such class of Common Stock, properly
endorsed or assigned for transfer (unless the
Corporation shall waive such requirement) are to
be surrendered for delivery of certificates for
shares of such capital stock or cash and/or
securities or other property and (F) that,
subject to Section 2(d)(iv) hereof, dividends on
such shares of Common Stock will cease to be
paid as of such Exchange Date or Re demption
Date. Such notice shall be sent by first-class
mail, postage prepaid, not less than 30 nor more
than 60 days prior to the Exchange Date or
Redemption Date, as the case may be, and in any
case to each holder of the class of Common Stock
to be exchanged or redeemed, at such holder's
address as the same appears on the stock
transfer books of the Corpora tion. Neither the
failure to mail such notice to any particular
holder of such class of Common Stock nor any
defect therein shall affect the suffi ciency
thereof with respect to any other holder of such
class of Common Stock.
(ii) If less than all of the
outstanding shares of Steel Stock or Delhi
Stock, as the case may be, are to be redeemed
pursuant to clause (B) of Section 2(b)(i) or
clause (B) of Section 2(c)(i), respectively,
such shares shall be redeemed by the Corporation
pro rata among the holders of such class of
Common Stock or by such other method as may be
determined by the Board of Directors to be
equitable.
(iii) The Corporation shall not be
required to issue or deliver fractional shares
of any class of capital stock or any fractional
securities to any holder of any class of Common
Stock upon any exchange, redemp tion, dividend
or other distribution pursuant to this Section
2. If more than one share of any class of Common
Stock shall be held at the same time by the same
holder, the Corporation may aggregate the number
of shares of any class of capital stock that
shall be issuable or the amount of securities
that shall be deliverable to such holder upon
any exchange, redemption, dividend or other
distribution (including any fractions of shares
or securi ties). If the number of shares of any
class of capital stock or the amount of
securities remaining to be issued or delivered
to any holder of any class of Common Stock is a
fraction, the Corporation shall, if such
fraction is not issued or delivered to such
holder, pay a cash adjustment in respect of such
fraction in an amount equal to the fair market
value of such fraction on the fifth Business Day
prior to the date such payment is to be made.
For purposes of the preceding sentence, "fair
market value" of any fraction shall be (i) in
the case of any fraction of a share of capital
stock of the Corporation, the product of such
fraction and the Market Value of one share of
such capital stock and (ii) in the case of any
other fractional security, such value as is
determined by the Board of Directors.
(iv) No adjustments in respect of
dividends shall be made upon the exchange or
redemption of any shares of any class of Common
Stock; provided, however, that if the Exchange
Date or Redemption Date with respect to any
class of Common Stock shall be subsequent to the
record date for the payment of a dividend or
other distribution thereon or with respect
thereto, the holders of shares of such class of
Common Stock at the close of business on such
record date shall be entitled to receive the
dividend or other distribution payable on or
with respect to such shares on the date set for
payment of such dividend or other distribution,
notwith standing the exchange or redemption of
such shares or the Corporation's default in
payment of the dividend or distribution due on
such date.
(v) Before any holder of shares of any
class of Common Stock shall be entitled to
receive certificates representing shares of any
capital stock or cash and/or securities or other
property to be received by such holder with
respect to such shares of such class of Common
Stock pursu ant to this Section 2, such holder
shall surrender at such office as the
Corporation shall specify certificates for such
shares of such class of Common Stock, properly
endorsed or assigned for transfer (unless the
Corporation shall waive such requirement). The
Corporation will as soon as practicable after
such surrender of certificates representing such
shares of such class of Common Stock deliver to
the person for whose account such shares of such
class of Common Stock were so surrendered, or to
his nominee or nominees, certificates
representing the number of whole shares of the
kind of capital stock or cash and/or securities
or other property to which he shall be entitled
as aforesaid, together with any fractional pay
ment contemplated by Section 2(d)(iii). If less
than all of the shares of any class of Common
Stock, represented by any one certificate are to
be redeemed, the Corporation shall issue and
deliver a new certificate for the shares of such
class of Common Stock not redeemed.
(vi) From and after any applicable
Exchange Date or Redemption Date, all rights of
a holder of shares of any class of Common Stock
that were exchanged or redeemed shall cease
except for the right, upon surren der of the
certificates representing such shares of Common
Stock, to receive certificates representing
shares of the kind and amount of capital stock
or cash and/or securities or other property for
which such shares were exchanged or redeemed,
together with any fractional payment
contemplated by Section 2(d)(iii) and rights to
dividends as provided in Section 2(d)(iv). No
holder of a certificate, that immediately prior
to the applicable Exchange Date for any class of
Common Stock represented shares of such class of
Common Stock, shall be entitled to receive any
dividend or other distribution with respect to
shares of any kind of capital stock into which
such class of Common Stock was exchanged until
surrender of such holder's certificate for a
certificate or certificates repre senting shares
of such kind of capital stock. Upon such
surrender, there shall be paid to the holder the
amount of any dividends or other distribu tions
(without interest) which theretofore became
payable with respect to a record date after the
Exchange Date, but that were not paid by reason
of the foregoing, with respect to the number of
whole shares of the kind of capital stock
represented by the certificate or certificates
issued upon such surrender. From and after an
Exchange Date for any class of Common Stock, the
Corporation shall, however, be entitled to treat
the certificates for such class of Common Stock
that have not yet been surrendered for exchange
as evidencing the ownership of the number of
whole shares of the kind or kinds of capital
stock for which the shares of such class of
Common Stock represented by such certificates
shall have been ex changed, notwithstanding the
failure to surrender such certificates.
(vii) The Corporation will pay any and
all documentary, stamp or similar issue or
transfer taxes that may be payable in respect of
the issue or delivery of any shares of capital
stock on exchange of shares of any class of
Common Stock pursuant hereto. The Corporation
shall not, however, be required to pay any tax
that may be payable in respect of any transfer
involved in the issue and delivery of any shares
of capital stock in a name other than that in
which the shares of the class of Common Stock so
exchanged were registered, and no such issue or
delivery shall be made unless and until the
person requesting such issue has paid to the
Corpora tion the amount of any such tax, or has
established to the satisfaction of the
Corporation that such tax has been paid.
3. Voting Rights.
(a) Except as provided in clauses (c), (d) or
(e) below, the holder s of all classes of Common Stock
shall vote together as a single class on all matters as
to which holders of Common Stock are entitled to vote. On
all matters to be voted on by the holders of all classes
of Common Stock together as a single class, (i) each
outstanding share of Marathon Stock shall have one vote,
(ii) each outstand ing share of any other class of Common
Stock shall have a number of votes equal to the quotient
(calculated to the nearest three decimal places), as of
the fifth Business Day prior to the applicable record
date or as of any other applicable date, of (A) the sum
of (1) four times the average ratio of X/Y for the
five-Business Day period ending on such fifth Business
Day, (2) three times the average ratio of X/Y for the
next preceding five-Business Day period, (3) two times
the average ratio of X/Y for the next preceding
five-Business Day period and (4) the average ratio of X/Y
for the next preceding five-Business day period, divided
by (B) ten, where X is the Market Value of such class of
Common Stock and Y is the Market Value of the Marathon
Stock or if there are no shares of Marathon Stock
outstand ing on such record or other applicable date or
on any of the twenty-five Business Days prior thereto,
the sum of the Market Values of the Steel Stock and of
the Delhi Stock; provided that until the Delhi Stock has
been traded regular way on the New York Stock Exchange
for at least twenty-five Business Days, each outstanding
share of the Delhi Stock shall have a number of votes
equal to the ratio of A/B (calculated to the nearest
three decimal places), where A is the average of the high
and low reported sales prices of a share of the Delhi
Stock on the New York Stock Exchange, and B is the
average of the high and low reported sales prices of a
share of Marathon Stock or, if there are no shares of
Marathon Stock outstanding, the sum of the average of the
high and low reported sales prices of a share of the
Steel Stock and a share of the Delhi Stock on such Ex
change, in each case on the Effective Date, or on the
first Business Day thereafter on which shares of the
Delhi Stock are traded on such Exchange. If shares of
only one class of Common Stock are outstanding, each
share of that class shall have one vote.
(b) Unless the vote or consent of a greater
number of shares shall then be required by law, the vote
or consent of the holders of a majority of all of the
shares of any class of Common Stock then outstanding,
voting as a separate class, shall be necessary for
authorizing, effecting or validating the merger or
consolida tion of the Corporation into or with any other
corporation if such merger or consolidation would
adversely affect the powers or special rights of such
class of Common Stock either directly by amendment of
this Certificate of Incorporation or indirectly by
requiring the holders of such class to accept or retain,
in such merger or consolidation, anything other than (i)
shares of such class or (ii) shares of the surviving or
resulting corporation having, in either case, powers and
special rights identical to those of such class prior to
such merger or consolidation.
(c) Unless the vote or consent of a greater
number of shares shall then be required by law, the vote
or consent of the holders of at least 66 2/3% of all of
the shares of Steel Stock then outstanding, voting as a
separate class, shall be neces sary for:
(i) the declaration or payment of any
dividend on, or the making of any other payment
or distribution with respect to, any shares of
any other class of Common Stock, if such
dividend, payment or distribution is to be made
with (A) proceeds from the Disposition of any of
the properties and assets of the Marathon Group
or (B) any portion of an equity interest in a
person, entity or group that owns any of the
properties or assets of the Marathon Group; or
(ii) the use, or reservation for use,
of any proceeds from the Disposition of any of
the properties and assets of the U.S. Steel
Group, or any of the properties and assets
acquired with such proceeds, in any business of
the Corporation other than a business of the
U.S. Steel Group;
provided such vote shall not be required to the extent
such proceeds are loaned at a rate or rates
representative of actual borrowings and short-term
investments by the Corporation
(d) Unless the vote or consent of a greater
number of shares shall then be required by law, the vote
or consent of the holders of at least 66 2/3% of all the
shares of Marathon Stock then outstanding, voting as a
separate class, shall be necessary for:
(i) the declaration or payment of any
dividend on, or the making of any other payment
or distribution with respect to, any shares of
any other class of Common Stock, if such
dividend, payment or distribution is to be made
with (A) proceeds from the Disposition of any of
the properties and assets of the U.S. Steel
Group or (B) any portion of an equity interest
in a person, entity or group that owns any of
the properties or assets of the U.S. Steel
Group; or
(ii) the use, or reservation for use,
of any proceeds from the Disposition of any of
the properties and assets of the Marathon Group,
or any of the properties and assets acquired
with such proceeds, in any business of the
Corporation other than a business of the
Marathon Group;
provided such vote shall not be required if such proceeds
are loaned at a rate or rates representative of actual
borrowings and short-terms investment by the Corporation.
(e) Unless the vote or consent of a greater
number of shares shall then be required by law, the vote
or consent of the holders of at least 66 2/3% of all of
the shares of Delhi Stock then outstanding, voting as a
separate class, shall be necessary for:
(i) the declaration or payment of any
dividend on, or the making of any other payment
or distribution with respect to any shares of
any other class of Common Stock, if such
dividend, payment or distribution is to be made
with (A) proceeds from the Disposition of any of
the properties and assets of the Delhi Group or
(B) any portion of an equity interest in a
person, entity or group that owns any of the
properties or assets of the Delhi Group; or
(ii) the use, or reservation for use,
of any proceeds from the Disposition of any of
the properties and assets of the Delhi Group, or
any of the properties and assets acquired with
such proceeds, in any business of the
Corporation other than a business of the Delhi
Group;
provided such vote shall note be required if such
proceeds are loaned at a rate or rates representative of
actual borrowings and short-term investments by the
Corporation.
(f) The number of authorized shares of any class
of Common Stock may be increased or decreased (but not
below the number of shares thereof then outstanding) by
the affirmative vote of the holders of shares of Common
Stock having a majority of the votes entitled to be cast
by the holders of all classes of Common Stock, voting
together as provided for in Section 3(a) and without a
separate vote of the holders of any class.
4. Liquidation Rights. In the event of the dissolution,
liquidation or winding-up of the Corporation, whether voluntary or
involuntary, after there shall have been paid or set apart for the
holders of Preferred Stock the full preferential amounts to which
they are entitled, the holders of the outstanding shares of each
class of Common Stock shall be entitled to receive a fraction of
the funds of the Corporation remaining for distribution to its
stockholders, where such fraction is equal to the quotient of (A)
the sum of (1) four times the average ratio of x/y for the
five-Business Day period ending on the Business Day prior to the
date of the public announcement of (I) a voluntary dissolution,
liquida tion or winding-up by the Corporation or (II) the
institution of the proceeding for the involuntary dissolution,
liquidation or winding-up of the Corporation, (2) three times the
average ratio of x/y for the next preceding five-Business Day
period, (3) two times the average ratio of x/y for the next
preceding five-Business Day period and (4) the average ratio of
x/y for the next preceding five-Business Day period, divided by
(B) ten, where x is the Market Capitalization of such class of
Common Stock, and y is the aggregate Market Capitalization of all
classes of Common Stock. For purposes of the preceding sentence,
"Market Capitalization" of any class of Common Stock on any day
shall mean the product of (i) the Market Value of such class of
Common Stock on such day and (ii) the number of shares of such
class of Common Stock outstanding on such day.
5. Definitions. As used in this Division I, the following
terms shall have the following meanings (with terms defined in the
singular having comparable meaning when used in the plural and
vice versa), unless another definition is provided or the context
otherwise requires:
"Available Delhi Dividend Amount," on any date,
shall mean the product of the Delhi Fraction and either
(a) the greater of (i) an amount equal to (x) $172.9
million, increased or decreased, as appropriate, to
reflect, from June 30, 1992, (A) Delhi Net Income, (B)
any dividends or other distributions declared or paid
with respect to, or repurchases or issuances of, any
shares of Marathon Stock prior to the close of business
on the date Delhi Stock is first issued attributed to the
Delhi Group, (C) any dividends or other distributions
declared or paid with respect to, or repurchases or
issuances of, any shares of Delhi Stock or any shares of
Preferred Stock attributed to the Delhi Group, (D) assets
or properties of the Delhi Group that are no longer
included as part of the Delhi Group as a result of any
such dividend, distribution or repurchase pursuant to the
proviso to the definition of "Delhi Group" and (E) any
other adjustments to stockholders' equity of the Delhi
Group made in accordance with generally accepted
accounting principles, less (y) the sum of the aggregate
stated capital of all outstanding Preferred Stock attrib
uted to the Delhi Group and the quotient of the aggregate
par value of all out standing Delhi Stock divided by the
Delhi Fraction and (ii) the excess of the fair market
value of the net assets of the Delhi Group over the sum
of the aggregate stated capital of all outstanding
Preferred Stock attributed to the Delhi Group, and the
quotient of the aggregate par value of all outstanding
Delhi Stock dividend by the Delhi Fraction, or (b) in
case there shall be no such amount, an amount equal to
Delhi Net Income (if positive) for the fiscal year in
which the dividend is declared and/or the preceding
fiscal year.
"Available Steel Dividend Amount", on any date,
shall mean either (a) the greater of (i) an amount equal
to (x) $2.244 billion, increased or decreased, as
appropriate, to reflect (A) Steel Net Income from the
close of business on Decem ber 31, 1990, (B) any
dividends or other distributions declared or paid with
respect to, or repurchases or issuances of, any shares of
common stock of the Corporation after December 31, 1990
and prior to the close of business on May 6, 1991
attributed to the U.S. Steel Group, (C) any dividends or
other distributions declared or paid with respect to, or
repurchases or issuances of, any shares of Steel Stock or
any shares of Preferred Stock attributed to the U.S.
Steel Group and (D) any other adjustments to
stockholders' equity of the U.S. Steel Group made in
accordance with generally accepted accounting principles,
less (y) the sum of the aggregate par value of all
outstanding Steel Stock and the aggregate stated capital
of all outstanding Preferred Stock attributed to the U.S.
Steel Group and (ii) the excess of the fair market value
of the net assets of the U.S. Steel Group over the sum of
the aggregate par value of all outstanding Steel Stock
and the aggregate stated capital of all outstanding
Preferred Stock attributed to the U.S. Steel Group, in
the case of each of clause (i) and clause (ii) increased
by an amount equal to any effects of the recognition of
the transition obligation upon the adoption of Statement
of Financial Accounting Standards (SFAS) No. 106,
"Employer's Accounting for Postretirement Benefits Other
than Pensions" (including any amendments thereto) and any
cumulative effects of the adoption of SFAS No. 109,
"Accounting for Income Taxes" (including any amendments
thereto) in the year of adoption or (b) in case there
shall be no such amount, an amount equal to Steel Net
Income (if positive) for the fiscal year in which the
dividend is declared and/or the preceding fiscal year.
"Business Day" shall mean each weekday other
than any day on which any relevant class of Common Stock
is not traded on any national securities exchange or the
National Association of Securities Dealers Automated
Quotations National Market System or in the
over-the-counter market.
"Convertible Securities" shall mean any
securities of the Corporation that are convertible into
or evidence the right to purchase any shares of any class
of Common Stock, pursuant to antidilution provisions of
such securities or other wise.
The "Delhi Fraction" as of any date is a
fraction the numerator of which shall be the number of
shares of Delhi Stock outstanding on such date and the
denominator of which shall be initially 14,000,000
provided that such fraction shall in no event be greater
than one. The denominator of the Delhi Fraction shall be
adjusted from time to time as appropriate to reflect (i)
subdivisions (by stock split or otherwise) and
combinations (by reverse stock split or otherwise) of the
Delhi Stock and stock dividends payable in shares of
Delhi Stock to holders of Delhi Stock and other
reclassifications of Delhi Stock, (ii) the issuance of
Delhi Stock, the proceeds of which are attributed to the
Delhi Group and (iii) repur chases by the Corporation of
outstanding shares of Delhi Stock.
"Delhi Group" shall mean, (i) all of the
businesses in which any of Delhi Gas Pipeline
Corporation, The Nueces Company, Delhi Gasmark, Inc.
(previously Texas Gasmark, Inc.), Tonkawa Gas Processing
Company, Delhi Gas Marketing Corp. (previously TXO Gas
Marketing Corp.), Delhi Gas Ventures Corp. (previ ously
TXO Gas Ventures Corp.), Red River Gas Pipeline
Corporation, Ozark Gas Pipeline Corporation, Sweetwater
Pipeline Corporation, Western Gas Transmis sion, Inc.,
and Western Gas Corporation (or any of their predecessors
or succes sors) is or has been engaged, directly or
indirectly, (ii) all assets and liabilities of the
Corporation to the extent attributed to any of such
businesses, whether or not such assets or liabilities are
or were assets and liabilities of such companies, and
(iii) such businesses, assets and liabilities acquired by
the Corporation for the Delhi Group as determined by the
Board of Directors to be included in the Delhi Group;
provided that, from and after any dividend or
distribution with respect to any shares of Delhi Stock,
or any repurchase of shares of Delhi Stock from holders
of Delhi Stock generally, the Delhi Group shall no longer
include an amount of assets or properties of the Delhi
Group equal to the aggregate amount of such kind of
assets or properties so paid in respect of shares of
Delhi Stock multiplied by a fraction, the numerator of
which is equal to one less the Delhi Fraction and the
denominator of which is equal to the Delhi Fraction. From
and after the date on which all of the outstanding shares
of Steel Stock are exchanged for shares of Delhi Stock
pursuant to any provision of Section 2, all of the
businesses, assets and liabilities of the U.S. Steel
Group shall be included in the Delhi Group.
"Delhi Group Subsidiary" shall have the meaning
set forth in Section 2(c)(v).
"Delhi Net Income" shall mean the net income or
loss of the Delhi Group determined in accordance with
generally accepted accounting principles, includ ing
income and expenses of the Corporation attributed to the
operations of the Delhi Group on a substantially
consistent basis, including, without limitation,
corporate administrative costs, net interest and other
financial costs and income taxes.
"Disposition" shall mean the sale, transfer,
assignment or other disposition (whether by merger,
consolidation, sale or contribution of assets or stock or
otherwise) of properties or assets.
"Exchange Date" shall mean any date fixed for an
exchange of shares of any class of Common Stock, as set
forth in a notice to holders of such class of Common
Stock pursuant to Section 2(d)(i).
"Marathon Group" shall mean, at any time, (i)
all of the businesses in which any of the Marathon Oil
Company, Texas Oil & Gas Corp., Carnegie Natural Gas
Company and Apollo Gas Company (or any of their
predecessors or successors) is or has been engaged,
directly or indirectly, other than the businesses of the
Delhi Group after the date of the first issuance of Delhi
Stock, (ii) all assets and liabilities of the Corporation
to the extent attributed to any of such businesses,
whether or not such assets or liabilities are or were
assets and liabilities of such companies, (iii) a
proportionate interest in the business, assets and
liabilities of the Delhi Group equal to one less the
Delhi Fraction, and (iv) such businesses, assets, and
liabilities acquired by the Corporation for the Marathon
Group after May 6, 1991 and as determined by the Board of
Directors to be included in the Marathon Group; provided,
that, from and after any dividend or distribution with
respect to any shares of Delhi Stock, or any repurchase
of shares of Delhi Stock from holders of Delhi Stock
generally, the Marathon Group shall include an amount of
assets or properties of the Delhi Group equal to the
aggregate amount of such kind of assets or properties so
paid in respect of shares of Delhi Stock multiplied by a
fraction, the numerator of which is equal to one less the
Delhi Fraction and the denominator of which is equal to
the Delhi Fraction. From and after the date on which
there are no shares of Steel Stock outstanding (other
than as a result of an exchange for shares of Delhi Stock
pursuant to any provision of Section 2), all of the
businesses, assets and liabilities of the U.S. Steel
Group shall be included in the Marathon Group.
"Marathon Group Subsidiary" shall have the
meaning set forth in Section 2(a)(i).
"Market Value" of any class of capital stock of
the Corporation on any Business Day shall mean the
average of the high and low reported sales prices regular
way of a share of such class on such Business Day or in
case no such reported sale takes place on such Business
Day the average of the reported closing bid and asked
prices regular way of a share of such class on such
Business Day, in either case on the New York Stock
Exchange Composite Tape, or if the shares of such class
are not listed or admitted to trading on such Exchange on
such Busi ness Day, on the principal national securities
exchange in the United States on which the shares of such
class are listed or admitted to trading, or if not listed
or admitted to trading on any national securities
exchange on such Business Day, on the National
Association of Securities Dealers Automated Quotations
National Market System, or if the shares of such class
are not listed or admitted to trading on any national
securities exchange or quoted on such National Market
System on such Business Day, the average of the closing
bid and asked prices of a share of such class in the
over-the-counter market on such Business Day as furnished
by any New York Stock Exchange member firm selected from
time to time by the Corporation, or if such closing bid
and asked prices are not made available by any such New
York Stock Exchange member firm on such Business Day, the
market value of a share of such class as determined by
the Board of Directors; provided that (i) for purposes of
determining the ratios set forth in Sections 2(b)(i),
2(b)(ii), 2(c)(ii), 2(c)(iii), 3(a) and 4, the "Market
Value" of any share of any class of Common Stock on any
day prior to the "ex" date or any similar date for any
dividend or distribution paid or to be paid with respect
to such class of Common Stock (other than a regular
quarterly cash dividend or a dividend or distribution in
shares of such class of Common Stock) shall be reduced by
the fair market value of the per share amount of such
dividend or distribution and (ii) for purposes of
determining the ratios set forth in Sections 2(b)(i),
2(b)(ii), 2(c)(i), 2(c)(ii), 2(c)(iii) and 3(a), the
"Market Value" of any share of any class of Common Stock
on any day prior to (A) the effective date of any
subdivision (by stock split or otherwise) or combination
(by reverse stock split or otherwise) of outstanding
shares of such class of Common Stock or (B) the "ex" date
or any similar date for any dividend or distribution with
respect to either such class of Common Stock in shares of
such class of Common Stock shall be appropriately
adjusted to reflect such subdivision, combination,
dividend or distribution. For the purposes of the
foregoing clause (i), the Board of Directors shall
determine the fair market value of any dividend or
distribution.
"Net Proceeds", as of any date, from any
Disposition of any of the proper ties and assets of the
U.S. Steel Group or the Delhi Group, as the case may be,
shall mean an amount, if any, equal to the gross proceeds
of such Disposition after any payment of, or reasonable
provision for, (i) any taxes payable by the Corpora tion
in respect of such Disposition, (ii) any taxes payable by
the Corporation in respect of any dividend or redemption
pursuant to clause (A) or (B), respectively, of Sections
2(b)(i) or 2(c)(i), respectively, (iii) any transaction
costs, including, without limitation, any legal,
investment banking and accounting fees and expenses and
(iv) any liabilities (contingent or otherwise) of, or
allocated to, the U.S. Steel Group or the Delhi Group, as
the case may be, including, without limitation, any
indemnity obligations incurred in connection with the
Disposition. For purposes of this definition, any
properties and assets of the Steel Group or the Delhi
Group, as the case may be, remaining after such
Disposition shall constitute "reasonable provision" for
such amount of taxes, costs and liabilities (contingent
or otherwise) as can be supported by such properties and
assets. To the extent the proceeds of any Disposition
include any securities or other property other than cash,
the Board of Directors shall determine the value of such
securities or property.
"Redemption Date" shall mean any date fixed for
a redemption of shares of any class of Common Stock, as
set forth in a notice to holders of such class of Common
Stock pursuant to Section 2(d)(i).
"Steel Net Income" shall mean the net income or
loss of the U.S. Steel Group determined in accordance
with generally accepted accounting principles, including
income and expenses of the Corporation attributed to the
operations of the Steel Group on a substantially
consistent basis, including, without limitation,
corporate administrative costs, net interest and other
financial costs and income taxes.
"U.S. Steel Group" shall mean, at any time, all
of the businesses in which the Corporation is or has been
engaged, directly or indirectly, and all assets and
liabilities of the Corporation, other than any
businesses, assets or liabilities of the Marathon Group
or the Delhi Group if any shares of Marathon Stock or
Delhi Stock are outstanding.
"U.S. Steel Group Subsidiary" shall have the
meaning set forth in Section 2(b)(iii).
6. Determinations by the Board of Directors. Any
determinations made by the Board of Directors of the Corporation
under any provision in this Division I of Article Fourth shall be
final and binding on all stockholders of the Corporation.
DIVISION II
A statement of the designations of the Preferred Stock or of any
series thereof, and the powers, preferences and relative, participating,
optional or other special rights, and qualifica tions, limitations or
restrictions thereof, or of the authority of the Board of Directors to fix
by resolution or resolutions such designations and other terms not fixed by
the Certificate of Incorporation, is as follows:
1. The Preferred Stock may be issued in one or more
series, from time to time, with each such series to have such
designation, powers, preferences and relative, partici pating,
optional or other special rights, and qualifications, limitations
or restrictions thereof, as shall be stated and expressed in the
resolution or resolutions providing for the issue of such series
adopted by the Board of Directors of the Corporation, subject to
the limitations prescribed by law and in accordance with the
provisions hereof, the Board of Directors being hereby expressly
vested with authority to adopt any such resolution or resolutions.
The authority of the Board of Directors with respect to each such
series shall include, but not be limited to, the determination or
fixing of the following:
(i) The distinctive designation and
number of shares comprising such series, which
number may (except where otherwise provided by
the Board of Directors in creating such series)
be increased or decreased (but not below the
number of shares then outstanding) from time to
time by like action of the Board of Directors;
(ii) The dividend rate of such series,
the conditions and times upon which such
dividends shall be payable, the relation which
such dividends shall bear to the dividends
payable on any other class or classes of stock
or series thereof, or any other series of the
same class, and whether dividends shall be
cumulative or non-cumulative;
(iii) The conditions upon which the
shares of such series shall be subject to
redemption by the Corporation and the times,
prices and other terms and provisions upon which
the shares of the series may be re deemed;
(iv) Whether or not the shares of the
series shall be subject to the operation of a
retirement or sinking fund to be applied to the
purchase or redemption of such shares and, if
such retirement or sinking fund be established,
the annual amount thereof and the terms and
provisions relative to the operation thereof;
(v) Whether or not the shares of the
series shall be convertible into or exchangeable
for shares of any other class or classes, with
or without par value, or of any other series of
the same class, and, if provi sion is made for
conversion or exchange, the times, prices,
rates, adjust ments, and other terms and
conditions of such conversion or exchange;
(vi) Whether or not the shares of the
series shall have voting rights, in addition to
the voting rights provided by law, and, if so,
subject to the limitation hereinafter set forth,
the terms of such voting rights;
(vii) The rights of the shares of the
series in the event of volun tary or involuntary
liquidation, dissolution, or upon the
distribution of assets of the Corporation;
(viii) Any other powers, preferences
and relative, participating, optional or other
special rights, and qualifications, limitations
or restric tions thereof, of the shares of such
series, as the Board of Directors may deem
advisable and as shall not be inconsistent with
the provisions of this Certificate of
Incorporation.
2. The holders of shares of the Preferred Stock of each
series shall be entitled to receive, when and as declared by the
Board of Directors, out of funds legally available for the payment
of dividends, dividends at the rates fixed by the Board of
Directors for such series, and no more, before any dividends,
other than dividends payable in Common Stock, shall be declared
and paid, or set apart for payment, on the Common Stock with
respect to the same dividend period.
3. Whenever, at any time, dividends on the then
outstanding Preferred Stock as may be required with respect to any
series outstanding shall have been paid or declared and set apart
for payment on the then outstanding Preferred Stock, and after
complying with respect to any retirement or sinking fund or funds
for any series of Preferred Stock, the Board of Directors may,
subject to the provisions of the resolution or resolutions
creating any series of Preferred Stock, declare and pay dividends
on the Common Stock, and the holders of shares of the Preferred
Stock shall not be entitled to share therein.
4. The holders of shares of the Preferred Stock of each
series shall be entitled upon liquidation or dissolution or upon
the distribution of the assets of the Corporation to such
preferences as provided in the resolution or resolutions creating
such series of Preferred Stock, and no more, before any
distribution of the assets of the Corporation shall be made to the
holders of shares of the Common Stock.
5. Except as otherwise provided by a resolution or
resolutions of the Board of Directors creating any series of
Preferred Stock or by the General Corporation Law of Delaware, the
holders of shares of the Common Stock issued and outstanding shall
have and possess the exclusive right to notice of stockholders'
meetings and the exclusive power to vote. The holders of shares of
the Preferred Stock issued and outstanding shall, in no event, be
entitled to more than one vote for each share of Preferred Stock
held by them unless otherwise required by law.
Terms of the Preferred Stocks are as follows:
Series A Junior Preferred Stock
Section 1. Designation and Amount. This resolution shall
provide for a single series of preferred stock, the designation of
which shall be "Series A Junior Preferred Stock", without par
value, and the number of shares constituting such series shall be
Eight Million (8,000,000).
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of
the holders of any shares of any series of Preferred
Stock ranking prior and superior to the shares of Series
A Junior Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Preferred Stock
shall be entitled to receive, when, as and if declared by
the Board of Directors out of funds legally available for
the purpose, quarterly dividends payable in cash on the
first day of March, June, September and Decem ber in each
year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the
first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series A
Junior Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $5.00 or
(b) subject to the provision for adjustment hereinafter
set forth, 100 times the aggregate per share amount of
all cash dividends, and 100 times the aggregate per share
amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend payable in
shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification
or otherwise), to be or being declared on the Common
Stock, par value $1.00 per share, of the Corporation (the
"Common Stock") with respect to the same divi dend
period. If the Quarterly Dividend Payment Date is a
Saturday, Sunday or legal holiday then such Quarterly
Dividend Payment Date shall be the first immediately
preceding calendar day which is not a Saturday, Sunday or
legal holiday. In the event the Corporation shall at any
time after October 10, 1989 (the "Rights Declaration
Date") (i) declare any dividend on Common Stock payable
in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such
case the amount to which holders of shares of Series A
Junior Preferred Stock were entitled immediately prior to
such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares
of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to
such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Junior Preferred Stock as
provided in paragraph (A) above immediately prior to the
time it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common
Stock); provided that, in the event no dividend or
distribution shall be declared on the Common Stock with
respect to a particular dividend period, a dividend of
$5.00 per share on the Series A Junior Preferred Stock
shall nevertheless be payable on such Quarterly Dividend
Pay ment Date with respect to such quarterly period.
(C) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series A Junior
Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares of Series
A Junior Preferred Stock, unless the date of issue of
such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends
on such shares shall begin to accrue from the date of
issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the
record date for the determination of holders of shares of
Series A Junior Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends
shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the
shares of Series A Junior Preferred Stock in an amount
less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro
rata on a share-by-share basis among all such shares at
the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of
Series A Junior Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon,
which record date shall be no more than 30 days prior to
the date fixed for the payment thereof. Dividends in
arrears may be declared and paid at any time, without
reference to any Quarterly Dividend Payment Date, to
holders of record on such date, not exceeding 45 days
preceding the payment date thereof, as may be fixed by
the Board of Directors.
(D) Except as hereinafter provided, no dividends
shall be declared or paid or set apart for payment on the
shares of Series A Junior Preferred Stock for any period
if the Corporation shall be in default in the payment of
any dividends (including cumulative dividends, if
applicable) on any shares of Preferred Stock ranking, as
to dividends, prior to the Series A Junior Preferred
Stock, unless the same shall be contemporaneously
declared and paid.
(E) Dividends payable on the Series A Junior
Preferred Stock for the initial dividend period and for
any period less than a full quarterly period, shall be
computed on the basis of a 360-day year of 30-day months.
Section 3. Voting Rights. The holders of shares of Series
A Junior Preferred Stock shall have the following voting rights:
(A) Each share of Series A Junior Preferred
Stock shall entitle the holder thereof to one vote on all
matters submitted to a vote of the stockholders of the
Corporation. The holders of Series A Junior Preferred
Stock shall be entitled to notice of all meetings of the
stockholders of the Corporation.
(B) Except as otherwise provided herein or by
law, the holders of shares of Series A Junior Preferred
Stock and the holders of shares of Common Stock shall
vote together as one class on all matters submitted to a
vote of stockholders of the Corporation.
(C) If, on the date used to determine
stockholders of record for any meeting of stockholders
for the election of directors, a default in preference
dividends on the Preferred Stock shall exist, the number
of directors constituting the Board of Directors of the
Corporation shall be increased by two, and the holders of
the Preferred Stock of all series (whether or not the
holders of such series of Preferred Stock would be
entitled to vote for the election of directors if such
default in preference dividends did not exist), shall
have the right at such meeting, voting together as a
single class without regard to series, to the exclusion
of the holders of Common Stock, to elect two directors of
the Corporation to fill such newly created directorships.
Each director elected by the holders of shares of
Preferred Stock (herein called a "Preferred Director"),
shall continue to serve as such director for the full
term for which he shall have been elected, notwithstand
ing that prior to the end of such term a default in
preference dividends shall cease to exist. Any Preferred
Director may be removed by, and shall not be removed
except by, the vote of the holders of record of the
outstanding shares of Preferred Stock, voting together as
a single class without regard to series, at a meeting of
the stockholders, or of the holders of shares of
Preferred Stock, called for the purpose. So long as a
default in any preference dividends on the Preferred
Stock shall exist (i) any vacancy in the office of a
Preferred Director may be filled (except as provided in
the following clause (ii)) by an instrument in writing
signed by the remaining Preferred Director and filed with
the Corporation and (ii) in the case of the removal of
any Preferred Director, the vacancy may be filled by the
vote of the holders of the outstanding shares of
Preferred Stock, voting together as a single class
without regard to series, at the same meeting at which
such removal shall be voted. Each director appointed as
aforesaid by the remaining Preferred Director shall be
deemed, for all purposes hereof, to be a Preferred
Director.
Whenever the term of office of the Preferred Directors
shall end and no default in preference dividends shall
exist, the number of directors constituting the Board of
Directors of the Corporation shall be reduced by two. For
the purposes of this paragraph (C), a "default in
preference dividends" on the Preferred Stock shall be
deemed to have occurred whenever the amount of accrued
and unpaid dividends upon any series of the Preferred
Stock shall be equivalent to six full quarterly dividends
or more, and, having so occurred, such default shall be
deemed to exist thereafter until, but only until, all
accrued dividends on all shares of Preferred Stock of
each and every series then outstanding shall have been
paid through the last Quarterly Dividend Payment Date.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other
dividends or distributions payable on the Series A Junior
Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of
Series A Junior Preferred Stock outstanding shall have
been paid in full, the Corporation shall not:
(i) declare or pay dividends on, make
any other distributions on (other than a
dividend in Common Stock or in any other stock
of the Corporation ranking junior to the Series
A Junior Preferred Stock as to dividends and
upon liquidation, dissolution or winding up and
other than as provided in subparagraph (ii) of
this section), or redeem or purchase or
otherwise acquire for consideration (except by
conversion into or ex change for stock of the
Corporation ranking junior to the Series A
Junior Preferred Stock as to dividends and upon
dissolution, liquidation or winding up), any
shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or
winding up) to the Series A Junior Pre ferred
Stock;
(ii) declare or pay dividends on or
! make any other distributions on any shares of
stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or
winding up) with the Series A Junior Preferred
Stock, except dividends paid ratably on the
Series A Junior Preferred Stock and all stock
ranking on a parity with the Series A Junior
Preferred Stock as to dividends on which
dividends are payable or in arrears in
proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise
acquire for consideration shares of any stock
ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up)
with the Series A Junior Preferred
Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire
shares of any such parity stock in exchange for
shares of any stock of the Corporation ranking
junior (as to dividends and upon dissolution,
liquidation or winding up) to the Series A
Junior Preferred Stock;
(iv) purchase or otherwise acquire for
consideration any shares of Series A Junior
Preferred Stock, except in accordance with a
purchase offer made in writing or by publication
(as determined by the Board of Directors) to all
holders of such shares upon such terms as the
Board of Directors, after consideration of the
respective annual dividend rates and other
relative rights and preferences of the
respective series and classes, shall determine
in good faith will result in fair and equitable
treatment among the respective series or
classes.
(B) The Corporation shall not permit any
subsidiary of the Corporation to purchase or otherwise
acquire for consideration any shares of stock of the
Corpo ration unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise
acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Junior Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such shares
shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new
series of Preferred Stock to be created by resolution or resolu
tions of the Board of Directors, subject to the conditions and
restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up.
(A) In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the
Corporation, the holders of the Series A Junior Preferred
Stock shall be entitled to receive the greater of (a)
$100 per share, plus accrued divi dends to the date of
distribution, whether or not earned or declared, or (b)
an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders
of Common Stock (the "Series A Liquidation Preference").
In the event the Corpo ration shall at any time after the
Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock or (iii) combine
the outstanding Common Stock into a smaller number of
shares, then in each such case the amount to which
holders of shares of Series A Junior Preferred Stock were
entitled immediately prior to such event pursuant to
clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which
is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) In the event, however, that there are not
sufficient assets available to permit payment in full of
the Series A Liquidation Preference and the liquidation
preferences of all other series of preferred stock, if
any, which rank on a parity with the Series A Junior
Preferred Stock, then such remaining assets shall be
distributed ratably to the holders of such parity shares
in proportion to their respective liquidation
preferences.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or securities,
cash and/or any other property, then in any such case the shares
of Series A Junior Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to 100
times the aggregate amount of stock, securities, cash and/or any
other property (payable in kind), as the case may be, into which
or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable
in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the amount set
forth in the preceding sentence with respect to the exchange or
change of shares of Series A Junior Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstand ing
immediately prior to such event.
Section 8. Optional Redemption.
(A) The Corporation shall have the option to
redeem the whole or any part of the Series A Junior
Preferred Stock at any time on at least 30 days notice in
accordance with the provisions of paragraph (B) of this
Section 8 at a redemption price equal to, subject to the
provision for adjustment hereinafter set forth, 100 times
the "current per share market price" of the Common Stock
on the date of the mailing of the notice of redemption,
together with unpaid accumulated dividends to the date of
such redemption. In the event the Corporation shall at
any time after October 10, 1989 (i) declare any dividend
on Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock or (iii) combine
the outstanding Common Stock into a smaller number of
shares, then in each such case the amount to which
holders of shares of Series A Junior Preferred
Stock were otherwise entitled immediately prior to such
event under the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which
is the number of shares of Common Stock that were
outstanding immediately prior to such event. The "current
per share market price" on any date shall be deemed to be
the average of the closing price per share of such Common
Stock for the 10 consecutive Trading Days (as such term
is hereinafter defined) immediately prior to such date.
The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place
on such day, the average of the closing bid and asked
prices regular way, in either case as reported in the
principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on
the New York Stock Exchange or, if the Common Stock is
not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated
transac tion reporting system with respect to securities
listed or admitted to trading on the principal national
securities exchange on which the Common Stock is listed
or admitted to trading or, if the Common Stock is not
listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted the
average of the high bid and low asked prices in the
over-the-counter market, as reported by the National
Association of Securities Dealers, Inc. Automated
Quotations System ("NASDAQ") or such other system then in
use or, if on any such date the Common Stock is not
quoted by any such organization, the average of the
closing bid and asked prices as furnished by a
professional market maker making a market in the Common
Stock selected by the Corporation. If on such date no
such market maker is making a market in the Common Stock,
the fair value of the Common Stock on such date as
determined in good faith by the Board of Directors of the
Corporation shall be used. The term "Trading Day" shall
mean a day on which the principal national securities
exchange on which the Common Stock is listed or admitted
to trading is open for the transaction of business or, if
the Common Stock is not listed or admitted to trading on
any national securities exchange, a Monday, Tuesday,
Wednesday, Thursday or Friday on which banking
institutions in the State of New York are not authorized
or obligated by law or executive order to close.
(B) Whenever shares of Series A Junior Preferred
Stock are to be re deemed, the Corporation shall mail a
notice ("Notice of Redemption") by first- class mail,
postage prepaid, to each holder of record of shares of
Series A Junior Preferred Stock to be redeemed and to the
transfer agent for the Series A Junior Preferred Stock.
The Notice of Redemption shall be addressed to the holder
at the address of the holder appearing on the stock
transfer books of the Corporation maintained by the
transfer agent for the Series A Junior Preferred Stock.
The Notice of Redemption shall include a statement of (i)
the redemption date, (ii) the redemption price, (iii) the
number of shares of Series A Junior Preferred Stock to
be redeemed, (iv) the place or places where shares of the
Series A Junior Preferred Stock are to be surrendered for
payment of the redemption price, (v) that the dividends
on the shares to be redeemed will cease to accrue on such
redemption date, and (vi) the provision under which
redemption is made. No defect in the Notice of Redemption
or in the mailing thereof shall affect the validity of
the redemption proceedings, except as required by law.
From the date on which a Notice of Redemption shall have
been given as aforesaid and the Corporation shall have
deposited with the transfer agent for the Series A Junior
Preferred Stock a sum sufficient to redeem the shares of
Series A Junior Preferred Stock as to which Notice of
Redemption has been given, with irrevocable instructions
and authority to pay the redemption price to the holders
thereof, or if no such deposit is made, then upon such
date fixed for redemption (unless the Corporation shall
default in making payment of the redemption price), all
rights of the holders thereof as stockholders of the
Corporation by reason of the ownership of such shares
(except their right to receive the redemption price
thereof, but without interest), shall terminate
including, but not limited to, their right to receive
dividends, and such shares shall no longer be deemed
outstanding. The Corpora tion shall be entitled to
receive, from time to time, from the transfer agent for
Series A Junior Preferred Stock the interest, if any, on
such monies deposited with it and the holders of any
shares so redeemed shall have no claim to any such
interest. In case the holder of any shares so called for
redemption shall not claim the redemption price for his
shares within one year after the date of redemption, the
transfer agent for the Series A Junior Preferred Stock
shall, upon demand, pay over to the Corporation such
amount remaining on deposit and the transfer agent for
the Series A Junior Preferred Stock shall thereupon be
relieved of all responsi bility to the holders of such
shares and such holder of the shares of the Series A
Junior Preferred Stock so called for redemption shall
look only to the corporation for the payment thereof.
(C) In the event that fewer than all the
outstanding shares of the Series A Junior Preferred Stock
are to be redeemed, the number of shares to be redeemed
shall be determined by the Board of Directors and the
shares to be redeemed shall be determined by lot or pro
rata as may be determined by the Board of Directors or by
any other method as may be determined by the Board of
Directors in its sole discretion to be equitable.
(D) If the Corporation shall be in default in
the payment of any dividends (including cumulative
dividends, if applicable) on any shares of Preferred
Stock ranking, as to dividends, prior to the Series A
Junior Preferred Stock, then no shares of the Series A
Junior Preferred Stock shall be redeemed and the Corpora
tion shall not purchase or otherwise acquire any shares
of the Series A Junior Preferred Stock.
Section 9. Ranking.
(A) The Series A Junior Preferred Stock shall
rank junior to all other series of the Corporation's
Preferred Stock as to the payment of dividends and the
distribution of assets upon liquidation, dissolution or
winding up, unless the terms of any such series shall
provide otherwise.
(B) For purposes of this resolution, any stock
of any class or classes of the Corporation shall be
deemed to rank:
(i) prior to the shares of the Series A
Junior Preferred Stock, either as to dividends
or upon liquidation, dissolution or winding up,
if the holders of such class or classes shall be
entitled to the receipt of dividends or of
amounts distributable upon dissolution,
liquidation or winding up of the Corporation,
whether voluntary or involuntary, as the case
may be, in preference or priority to the holders
of shares of the Series A Junior Preferred
Stock. Each holder of any share of the Series A
Junior Preferred Stock, by his acceptance
thereof, expressly covenants and agrees that the
rights of the holders of any shares of any other
series of Preferred Stock of the Corporation to
receive dividends or amounts distributable upon
disso lution, liquidation or winding up of the
Corporation, whether voluntary or involuntary,
shall be and hereby are expressly prior to his
rights unless in the case of any particular
series of Preferred Stock the certificate or
other instrument creating or evidencing the same
expressly provides that the rights of the
holders of such series shall not be prior to the
shares of the Series A Junior Preferred Stock;
and
(ii) on a parity with shares of the
Series A Junior Preferred Stock, either as to
dividends or upon liquidation, whether or not
the dividend rates, dividend payment dates or
redemption or liquidation prices per share or
sinking fund provisions, if any, be different
from those of the Series A Junior Preferred
Stock, if the holders of such stock shall be
entitled to the receipt of dividends or of
amounts distributable upon dissolution,
liquidation or winding up of the Corporation,
whether volun tary or involuntary, as the case
may be, in proportion to their respective
dividend rates or liquidation prices, without
preference or priority, one over the other, as
between the holders of such stock and the
holders of shares of the Series A Junior
Preferred Stock; and
(iii) junior to shares of the Series A
Junior Preferred Stock, either as to dividends
or upon liquidation, if such class or classes
shall be Common Stock or if the holders of
shares of the Series A Junior Preferred Stock
shall be entitled to receipt of dividends or of
amounts distributable upon dissolution,
liquidation or winding up of the Corporation,
whether voluntary or involuntary, as the case
may be, in preference or priority to the holders
of shares of such class or classes.
Section 10. Amendment. Except as otherwise set forth in
this Certificate of Designation, Preferences and Rights with
respect to the Series A Junior Preferred Stock, holders of Series
A Junior Preferred Stock shall not have any special powers and
their consent shall not be required for taking any corporate
action, provided, however, that:
(A) Unless the vote or consent of the holders of
a greater number of shares shall then be required by law,
the consent of the holders of at least 66 2/3% of all of
the shares of the Series A Junior Preferred Stock at the
time outstanding, given in person or by proxy, either in
writing or by a vote at a meeting called for the purpose
at which the holders of shares of the Series A Junior
Preferred Stock shall vote together as a separate class,
shall be necessary for authorizing, effecting or
validating the amendment, alteration or repeal of any of
the provisions of the Certificate of Incorporation or of
any certificate amendatory thereof or supple mental
thereto (including any Certificate of Designation,
Preferences and Rights of any similar document relating
to any series of Preferred Stock) so as to affect
adversely the powers, preferences, or rights, of this
Series A Junior Preferred Stock. The increase of the
authorized amount of the Preferred Stock, or the
creation, authorization or issuance of any shares of any
other class of stock of the Corporation ranking prior to
or on a parity with the shares of the Series A Junior
Preferred Stock as to dividends or upon liquidation, or
the reclassification of any authorized or outstanding
stock of the Corporation into any such prior or parity
shares, or the creation, authorization or issuance of any
obligation or security convertible into or evidencing the
right to purchase any such prior or parity shares shall
not be deemed to affect adversely the powers, preferences
or rights of the Series A Junior Preferred Stock.
Section 11. Fractional Shares. Series A Junior Preferred
Stock may be issued in fractions of a share which shall entitle
the holder, in proportion to such holder's fractional shares, to
exercise voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights or
holders of Series A Junior Preferred Stock.
6.50% Cumulative Convertible Preferred Stock
(Without Par Value)
1. Designation. This resolution shall provide for a
single series of Preferred Stock, the designation of which shall
be "6.50% Cumulative Convertible Preferred Stock", without par
value (hereinafter called this "Series"), and the number of
authorized shares constituting this Series is 3,000,000. Shares of
this Series shall have a stated value of $1.00 per share (which
shall also be the stated capital of each share). The number of
authorized shares of this Series may be reduced by further
resolution adopted by the Board of Directors and by the filing of
a certificate pursuant to the provisions of the General
Corporation Law of the State of Delaware stating that such
reduction has been so authorized, but the number of authorized
shares of this Series shall not be so increased.
2. Dividends.
(a) The holders of shares of this Series shall
be entitled to receive dividends payable in cash at a
rate of 6.50% per annum per share on the initial
liquidation preference of $50.00 per share. Such
dividends shall be cumulative from the date of original
issue of such shares, and shall be payable, when, as and
if declared by the Board of Directors, out of funds
legally available for such purpose, on the last calender
day of March, June, September and December of each year,
commencing June 30, 1993, except that if such date is a
Saturday, Sunday or legal holiday, then such dividend
shall be payable on the first immedi ately preceding
calendar day which is not a Saturday, Sunday or legal
holiday.
(b) Each dividend on shares of this Series shall
be paid to the holders of record of such shares as they
appear on the stock transfer books of the Corpora tion on
such record date, not exceeding 30 days preceding the
payment date thereof, as shall be fixed by the Board of
Directors. Dividends in arrears for any past dividend
period or any part thereof may be declared and paid at
any time, without reference to any regular dividend
payment date, to holders of record on such date, not
exceeding 45 days preceding the payment date thereof, as
may be fixed by the Board of Directors.
(c) Except as hereinafter provided, no dividends
shall be declared or paid or set apart for payment on the
Preferred Stock of any series ranking, as to dividends,
on a parity with or junior to this Series for any period
unless full cumulative dividends have been or
contemporaneously are declared and paid on this Series
for all past dividend periods. When dividends are not
paid in full, as aforesaid, upon the shares of this
Series and any other Preferred Stock ranking on a parity
as to dividends with this Series, all dividends declared
upon shares of this Series and any other Preferred Stock
ranking on a parity as to dividends with this Series
shall be declared pro rata so that the amount of
dividends declared per share on this Series and such
other Preferred Stock shall in all cases bear to each
other the same ratio that accrued dividends per share on
the shares of this Series and such other Preferred Stock
bear to each other. Holders of shares of this Series
shall not be entitled to any dividends, whether payable
in cash, property or stock, in excess of full cumulative
dividends, as herein provided, on this Series. No
interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments on
this Series which may be in arrears.
(d) So long as any shares of this Series are
outstanding, no dividend (other than a dividend in Common
Stock or in any other stock of the Corporation ranking
junior to this Series as to dividends and upon
liquidation and other than as provided in Section 2(c))
shall be declared or paid or set aside for payment or
other distribution declared or made upon the Common Stock
or any other stock of the Corporation ranking junior to
or on a parity with this Series as to dividends or upon
liquidation, nor shall any Common Stock nor any other
stock of the Corpo ration ranking junior to or on a
parity with this Series as to dividends or upon
liquidation be redeemed, purchased or otherwise acquired
for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any
shares of any such stock) by the Corporation (except by
conversion into or exchange for stock of the Corporation
ranking junior to this Series as to dividends and upon
liquidation) unless, in each case, the full cumulative
dividends on all outstanding shares of this Series shall
have been paid or contemporaneously are declared and paid
for all past dividend periods.
(e) Dividends payable on this Series for each
full quarterly dividend period shall be computed by
dividing the annual dividend rate by four and multiplying
by the initial liquidation preference of $50.00 per
share. Dividends payable on this Series for any period
shorter or longer than a full quarterly dividend period,
including for the initial dividend period, shall be
computed on the basis of a 360-day year of twelve 30-day
months.
3. Optional Redemption; Provision for U.S. Steel Group
Special Events; Related Provisions.
(a) Except as provided in Section 3(b), the
shares of this Series shall not be redeemable by the
Corporation prior to April 1 1996. On and after April 1,
1996, shares of this Series may, subject to the
satisfaction of the condition set forth in the last
sentence of this Section 3(a), be redeemed, in whole at
any time or in part from time to time, at the option of
the Corporation, out of funds legally available for such
purpose, for cash in an amount equal to the following
redemp tion prices per share if redeemed during the
twelve-month period beginning April 1 of the year
indicated below, upon giving notice as provided below:
Redemption Price
(As a percentage of initial Dollar Equivalent
Year liquidation preference) Per Share
---- ------------------------- ----------
1996 104.55% $52.275
1997 103.90 51.950
1998 103.25 51.625
1999 102.60 51.300
2000 101.95 50.975
2001 100.30 50.650
2002 100.65 50.325
2003 and 100.00 50.000
thereafter
and thereafter at the initial liquidation preference of
$50.00 per share, plus, in each case, an amount equal to
all accrued and unpaid dividends thereon to the date
fixed for redemption. No shares of this Series may be
redeemed in accordance with this Section 3(a) if the
Corporation shall be advised on or prior to the related
Redemption Date by either Moody's Investors Services,
Inc. ("Moody's") (pro vided that Moody's is then rating
the senior unsecured debt of the Corporation) or Standard
& Poor's Corporation ("S&P") (provided that S&P is then
rating the senior unsecured debt of the Corporation) that
such redemption would result in an immediate lowering by
Moody's or S&P, as the case may be, of the credit rating
on the Corporation's senior unsecured debt from its then
existing level, unless the Corporation shall have
received from the issuance of common stock of the
Corporation, since the date which is two years prior to
the related Redemption Date, net proceeds in an aggregate
amount at least equal to the product of the initial
liquidation preference of $50.00 per share times the
number of shares of this Series to be redeemed.
(b) (i) The shares of this Series shall be
redeemed by the Corporation, in whole, out of funds
legally available for such purpose, for cash in an amount
equal to the Redemption Price if any of the following
events with respect to the U.S. Steel Group occur (such
events, collectively, the "U.S. Steel Group Special
Events");
(A) (1) The Corporation
exchanges all of the outstanding shares
of Steel Stock for all of the
outstanding shares of common stock of
the U.S. Steel Group Subsidiary (as
provided in Section 2(b)(iii) of
Division I of the Certificate of
Incorporation) (the "Steel Group
Subsidiary Exchange") or (2) in the
event of a Dispo sition of all or
substantially all of the properties and
assets of the U.S. Steel Group, the
Corporation either pays a dividend on
the Steel Stock in, or redeems a number
of shares of Steel Stock for, an amount
equal to the Net Proceeds of such
Disposition (as provided in Section
2(b)(i)(A) or Section 2(b)(i)(B),
respectively, of Divi sion I of the
Certificate of Incorporation) (the
"Steel Group Dispo sition Dividend" or
the "Steel Group Disposition
Redemption", respectively ); or
(B) The Corporation pays a
dividend on, or the Corpora tion or any
of its Subsidiaries consummates a
tender offer or exchange offer for,
shares of Steel Stock and the aggregate
amount of such dividend or the
consideration paid in such tender offer
or exchange offer is an amount equal to
all or substantially all of the
properties and assets of the U.S. Steel
Group (the "Steel Group Special
Dividend" or the "Steel Group Tender or
Exchange Offer", respectively);
provided that the calculation of all or
substantially all of the properties and
assets of the U.S. Steel Group shall be
made without giving effect to any money
borrowed by the Corpo ration or any of
its Subsidiaries in connection with
such dividend or tender offer or
exchange offer, as the case may be.
The Redemption Date of shares of this Series pursuant to
this Section 3(b)(i) shall be, if the applicable U.S.
Steel Group Special Event is (I) the Steel Group Subsid
iary Exchange, the date of such exchange, (II) the Steel
Group Disposition Dividend or the Steel Group Special
Dividend, the date such dividend is paid, (III) the Steel
Group Disposition Redemption, the date of such redemption
or (IV) the Steel Group Tender or Exchange Offer, the
date such tender offer or exchange offer is consummated.
Notwithstanding anything to the contrary contained in
this Section 3(b)(i), any redemption pursuant to this
Section 3(b)(i) shall be conditioned upon the actual
exchange of Steel Stock for shares of com mon stock of
the U.S. Steel Group Subsidiary, payment of the Steel
Group Disposition Dividend or the amount due as a result
of the Steel Group Disposition Redemption (in each case
in the required kind of capital stock, cash, securities
and/or other property), payment of the Steel Group
Special Dividend or the consummation of the Steel Group
Tender or Exchange Offer, as the case may be.
(ii) The shares of this Series shall be
redeemed by the Corpora tion, in whole, out of
funds legally available for such purpose, for
cash in an amount equal to the Redemption Price
if following the Disposition of all or
substantially all of the properties and assets
of the U.S. Steel Group, the Corporation
exchanges all of the outstanding shares of Steel
Stock for Marathon Stock (as provided in Section
2(b)(i)(C) of Division I of the Certificate of
Incorporation) and, at any time subsequent to
such exchange, any of the following events with
respect to the Marathon Group occur (such
events, collectively, the "Marathon Group
Special Events"):
(A) The Corporation exchanges
all of the outstanding shares of
Marathon Stock for all of the
outstanding shares of common stock of
the Marathon Group Subsidiary (as
provided in Section 2(a)(i) of Division
I of the Certificate of Incorporation)
(the "Marathon Group Subsidiary
Exchange"); or
(B) The Corporation pays a
dividend on, or the Corpora tion or any
of its Subsidiaries consummates a
tender offer or exchange offer for,
shares of Marathon Stock and the
aggregate amount of such dividend or
the consideration paid in such tender
offer or exchange offer is an amount
equal to all or substantially all of
the properties and assets of the
Marathon Group (the "Marathon Group
Special Dividend" or the "Marathon
Group Tender or Exchange Offer",
respectively); provided that the
calculation of all or substantially all
of the properties and assets of the
Marathon Group shall be made without
giving effect to any money borrowed by
the Corporation or any of its
Subsidiaries in connection with such
dividend or tender offer or exchange
offer, as the case may be; provided,
further, that, at the time of the
payment of such dividend on, or the
consummation of such tender or exchange
offer for, Marathon Stock, there is
another class of common stock, other
than Marathon Stock, of the Corporation
then outstanding.
The Redemption Date of shares of this Series pursuant to
this Section 3(b)(ii) shall be, if the applicable
Marathon Group Special Event is (I) the Marathon Group
Subsidiary Exchange, the date of such exchange, (II) the
Marathon Group Special Dividend, the date such dividend
is paid or (III) the Marathon Group Tender or Exchange
Offer, the date such tender offer or exchange offer is
consum mated. Notwithstanding anything to the contrary
contained in this Section 3(b)(ii), any redemption
pursuant to this Section 3(b)(ii) shall be conditioned
upon the actual exchange of Marathon Stock for shares of
common stock of the Mara thon Group Subsidiary, payment
of the Marathon Group Special Dividend or the
consummation of the Marathon Group Tender or Exchange
Offer, as the case may be.
(c) The following general redemption provisions
shall apply, as the context requires, to any redemption
of any shares of this Series pursuant to this Section 3:
(i) In the event that fewer than all
the outstanding shares of this Series are to be
redeemed, the number of shares to be redeemed
shall be determined by the Board of Directors
and the shares to be redeemed shall be
determined by lot or pro rata as may be
determined by the Board of Directors or by any
other method as may be determined by the Board
of Directors in its sole discretion to be
equitable, provided that the Corpora tion may
redeem any number of shares of this Series owned
by holders whose aggregate holdings of such
shares do not exceed 100 as may be specified, by
the Corporation.
(ii) In the event the Corporation shall
redeem shares of this Series pursuant to this
Section 3, notice of such redemption shall be
given, (x) if such redemption is a result of the
Steel Group Tender or Exchange Offer or the
Marathon Group Tender or Exchange Offer, on the
date of the public announcement of such tender
offer or exchange offer by the Corpo ration or
any of its Subsidiaries, but in any event not
less than 30 days prior to such redemption, and
on the date of the public announcement of any
extension thereof, (y) if such redemption is a
result of the Steel Group Disposition Dividend
or the Steel Group Disposition Redemption, on a
date not less than 45 days prior to the date
selected by the Board of Direc tors for the
payment of such dividend or such redemption and
(z) other wise, on a date at least 30 days but
not more than 60 days prior to the date fixed
for such redemption by the Board of Directors,
in each case to each holder of record of the
shares of this Series to be redeemed. Such
notice shall be given by first class mail,
postage prepaid, at such holder's address as the
same appears on the stock transfer books of the
Corporation. Neither the failure to mail, to any
particular holder, any notice required by this
Section 3(c)(ii) nor any defect therein or in
the mailing thereof, shall affect the
sufficiency of the notice or the validity of the
proceedings for redemption with respect to any
other holder. Any notice which was mailed in the
manner herein provided shall be conclusively
presumed to have been duly given on the date
mailed whether or not the holder receives the
notice. Each such notice shall state, as
appropriate: (A) the Redemp tion Date; (B) the
number of shares of this Series 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; (C) the
Redemp tion Price to be paid in respect of the
redemption; (D) the place or places where
certificates for such shares are to be
surrendered for the payment of the Redemption
Price; (E) the then current Conversion Price
and, if any event then known to the Corporation
will result in an adjustment to the Conversion
Price on or prior to the Redemption Date, such
adjusted Conversion Price and the date of such
adjustment; (F) if such redemption of shares of
this Series is the result of a U.S. Steel Group
Special Event or a Marathon Group Special Event,
that such redemption is conditioned upon the
occurrence of the applicable U.S. Steel Group
Special Event or Marathon Group Special Event
and if that U.S. Steel Group Special Event is
the Steel Group Disposition Dividend or the
Steel Group Disposition Redemption, the last
date on which the shares of this Series may be
converted into shares of Steel Stock, determined
as set forth in Section 4(a); and (G) that
dividends on the shares of this Series to be
redeemed shall cease to accrue on the Redemption
Date, provided that if such redemption of shares
of this Series is the result of a U.S. Steel
Group Special Event or a Marathon Group Special
Event, the conditions to such redemption shall
have been satisfied.
(iii) Notice having been given as
provided in Section 3(c)(ii), from and after the
Redemption Date (unless default shall be made by
the Corporation in providing an adequate amount
of money for the payment of the Redemption Price
necessary to effect such redemption in
accordance with the terms hereof) (A) except if
the redemption is the result of a U.S. Steel
Group Special Event or a Marathon Group Special
Event and the conditions to such redemption
shall not have been satisfied, dividends on the
shares of this Series so called for redemption
shall cease to accrue, (B) such shares shall no
longer be deemed to be outstanding and (C) all
rights of the holders thereof as holders of
shares of this Series shall cease (except the
right to receive from the Corporation the
Redemption Price, without interest thereon, upon
surrender and endorsement of their
certificates). Upon surrender in accordance with
said notice of the certificates for any shares
so redeemed (properly endorsed or assigned for
transfer, unless the Corporation shall waive
such requirement), such shares shall be so re
deemed by the Corporation.
(iv) The Corporation's obligation to
provide an adequate amount of money for the
payment of the Redemption Price necessary to
effect any redemption in accordance with this
Section 3 shall be deemed fulfilled if, on or
before the applicable Redemption Date, the
Corporation shall deposit with a bank or trust
company that has an office in the Borough of
Manhattan, City of New York, and that has, or is
an affiliate of a bank or trust company that
has, a capital and surplus of at least
$50,000,000, an amount of money adequate for the
payment of the aggregate Redemption Price
necessary for such redemption in accordance with
the terms hereof, in trust, with irrevocable
instructions that such money be applied to the
redemption of the shares of this Series so
called for redemption. If such redemption is
conditioned upon the payment of the Steel Group
Disposi tion Dividend or payment of the amount
due as a result of the Steel Group Disposition
Redemption, the Corporation shall deposit such
moneys and give such irrevocable instructions in
respect of such redemption, subject to the
payment of such Steel Group Disposition Dividend
or payment of the amount due as a result of such
Steel Group Disposition Redemption, not later
than the 30th day prior to the date selected by
the Board for the payment of such dividend on,
or the redemption of, Steel Stock, but in any
event prior to the date the Corporation declares
such dividend or gives notice of such
redemption, each in accordance with Section 2 of
Division I of the Certificate of Incorporation.
No interest shall accrue for the benefit of the
holders of shares of this Series to be redeemed
on any money so payable by the Corporation in
respect of any redemption. Subject to applicable
escheat laws, any money unclaimed at the end of
two years from the related Redemption Date shall
revert to the general funds of the Corporation,
after which reversion the holders of such shares
so called for redemption shall look only to the
general funds of the Corporation for the payment
of such money. In case fewer than all the shares
of this Series represented by any such
certificate are redeemed, a new certificate
shall be issued representing the unredeemed
shared without cost to the holder thereof.
(v) Any shares of this Series which
shall at any time have been redeemed shall, upon
the taking of any action required by law, have
the status of authorized but unissued shares of
Preferred Stock, without designation as to
series until such shares are once more
designated as part of a particular series by the
Board of Directors.
(vi) Notwithstanding the foregoing
provisions of this Section 3, unless the full
cumulative dividends on all outstanding shares
of this Series shall have been paid or
contemporaneously are declared and paid for all
past dividend periods, no shares of this Series
shall be redeemed unless all outstanding shares
of this Series are simultaneously redeemed, and
the Corporation shall not purchase or otherwise
acquire any shares of this Series; provided,
however, that the foregoing shall not prevent
the purchase or acquisition of shares of this
Series pursuant to a purchase or exchange offer
made on the same terms to holders of all
outstanding shares of this Series.
4. Conversion or Exchange. Holders of shares of this
Series shall have the right to convert all or a portion of such
shares into shares of Steel Stock, as follows:
(a) Subject to and upon compliance with the
provisions of this Section 4, a holder of shares of this
Series shall have the right, at such holder's option, at
any time, to convert such shares into the number of fully
paid and nonassessable shares of Steel Stock equal to the
quotient of (i) the product of the initial liquida tion
preference for shares of this Series of $50.00 per share
for such shares times the number of shares of this Series
to be converted, divided by (ii) the Conversion Price (as
in effect on the date provided for in the last paragraph
of Section 4(b)) by surrendering the certificates
representing such shares to be converted, such surrender
to be made in the manner provided in accordance with this
Section 4; provided that the right to convert shares of
this Series called for redemption pursuant to Section 3
shall terminate at the close of business on the related
Redemption Date, unless the Corporation shall default in
making payment of any moneys payable upon such redemption
under Section 3 or, if the redemption of shares of this
Series is the result of a Steel Group Special Event or a
Marathon Group Special Event, the conditions to such
redemption shall not have been satisfied; and, provided
further, that if the Corporation has given notice of a
redemption pursuant to Section 3(c) which is conditioned
on the occurrence of the Steel Group Disposition Dividend
or the Steel Group Disposition Redemption, the right to
convert shares of this Series shall terminate on the 31st
day prior to the date selected by the Board of Directors
for such redemption. Any holder of any share or shares of
this Series may only convert whole shares of this Series
and the Corporation shall not be obligated to issue any
fractional shares of this Series.
(b) In order to exercise the conversion right,
the holder of any shares of this Series to be converted
shall surrender the certificate representing such shares,
duly endorsed or assigned to the corporation or in blank,
at the office of the Transfer Agent, accompanied by
written notice to the Corporation that the holder thereof
elects to convert such shares or a specified portion
thereof. Unless the shares issuable on conversion are to
be issued in the same name as the name in which such
shares of this Series are registered, any shares
surrendered for conver sion shall be accompanied by
instruments of transfer, in form satisfactory to the
Corporation, duly executed by the holder or such holder's
duly authorized attorney and an amount sufficient to pay
any transfer or similar tax (or evidence reasonably
satisfactory to the Corporation demonstrating that such
taxes have been paid).
Holders of shares of this Series at the close of
business on a record date for determining stockholders
entitled to receive a dividend shall be entitled to
receive the dividend payable on such shares on the
corresponding dividend payment date (except that holders
of shares called for redemption on a Redemption Date
between such record date and the dividend payment date
shall not be entitled to receive such dividend on such
dividend payment date) notwithstanding the conversion
thereof following such dividend record date and prior to
such dividend payment date. However, shares of this
Series surrendered for conversion during the period
between the close of business on any dividend record date
and the opening of business on the corresponding dividend
payment date (except shares called for redemption on a
Redemption Date during such period) must be accom panied
by payment of an amount equal to the dividend payable on
such shares on such dividend payment date. A holder of
shares of this Series on a dividend record date who (or
whose transferee) tenders any such shares for conversion
into shares of Steel Stock on a dividend payment date
will receive the dividend payable by the Corporation on
such shares of this Series on such date, and the
converting holder need not include payment of the amount
of such dividend upon surrender of such shares for
conversion. Except as provided above, the Corpora tion
shall make no payment or allowance for unpaid dividends,
whether or not in arrears, on converted shares or for
dividends on the shares of Steel Stock issued upon such
conversion.
As promptly as practicable after the surrender
of certificates for shares of this Series as aforesaid,
the Corporation shall issue and shall deliver at such
office to such holder, or on such holder's written order,
a certificate or certificates for the number of full
shares of Steel Stock issuable upon the conversion of
such shares in accordance with the provisions of this
Section 4, and any fractional interest in respect of a
share of Steel Stock arising upon such conversion shall
be settled as provided in Section 4(c).
Each conversion shall be deemed to have been
effected immediately prior to the close of business on
the date on which the certificates for shares of this
Series shall have been surrendered and the notice
referred to in the third preceding paragraph (and, if
applicable, payment of an amount equal to the dividend
payable on such shares as described in the second
preceding paragraph) received by the Corporation as
aforesaid and the person or persons in whose name or
names any certificate or certificates for shares of Steel
Stock shall be issuable upon such conversion shall be
deemed to have become the holder or holders of record of
the shares represented thereby at such time on such date
and such conversion shall be at the Conversion price in
effect at such time on such date.
(c) No fractional shares or scrip representing
fractions of shares of Steel Stock or any other common
stock of the Corporation shall be issued upon conver sion
of any share of this Series. Instead of any fractional
interest in a share of Steel Stock or such other common
stock that would otherwise be deliverable upon the
conversion of a share of this Series, the Corporation
shall pay to the holder of such share an amount in cash
based upon the Closing Price of Steel Stock or such other
common stock on the Trading Day immediately preceding the
date of conversion. If more than one share shall be
surrendered for conversion at one time by the same
holder, the number of full shares of Steel Stock or such
other common stock issuable upon conversion thereof shall
be computed on the basis of the aggregate number of
shares of this Series so surrendered.
(d) The Conversion Price per share of Steel
Stock shall be adjusted from time to time as follows:
(i) If the Corporation shall after the
date on which shares of this Series are
initially issued (A) pay a dividend or make a
distribution on any class of its capital stock
in shares of Steel Stock, (B) subdivide the out
standing Steel Stock into a greater number of
shares or (C) combine the outstanding Steel
Stock into a smaller number of shares, then the
Conver sion Price in effect at the opening of
business on the day next following the date
fixed for the determination of stockholders
entitled to receive such dividend or
distribution or at the opening of business on
the day next following the day on which such
subdivision or combination becomes effective, as
the case may be, shall be adjusted so that the
holder of any share of this Series thereafter
surrendered for conversion shall be entitled to
receive the number of shares of Steel Stock that
such holder would have owned or have been
entitled to receive after the happening of any
of the events described above had such share
been converted immediately prior to the record
date in the case of a dividend or distribution
or the effective date in the case of a
subdivision or combination. An adjustment made
pursuant to this Section 4(d)(i) shall become
effective immediately after the opening of
business on the day next following the record
date (except as provided in Section 4(m)) in the
case of a dividend or distribution and shall
become effective immediately after the opening
of business on the day next following the
effective date in the case of a subdivision or
combination.
(ii) If the Corporation shall issue
after the date on which shares of this Series
are initially issued rights or warrants (other
than any rights or warrants (including the
Rights) referred to in Section 4(d)(iii) below)
to all holders of Steel Stock entitling them
(for a period expiring within 45 days after the
record date mentioned below) to subscribe for or
purchase Steel Stock at a price per share less
than the Current Market Price per share of Steel
Stock on the record date for the determination
of stockholders entitled to receive such rights
or warrants, then the Conversion Price in effect
at the opening of business on the day next
following such record date shall be adjusted to
equal the price determined by multiplying (I)
the Conversion Price in effect immediately prior
to the opening of business on the day next
following the date fixed for such determination
by (II) a fraction, the numerator of which shall
be the sum of (A) the number of shares of Steel
Stock outstanding on the close of business on
the date fixed for such determination and (B)
the number of shares that the aggregate proceeds
to the Corporation from the exercise of such
rights or warrants for Steel Stock would
purchase at such Current Market Price, and the
denominator of which shall be the sum of (A) the
number of shares of Steel Stock outstanding on
the close of business on the date fixed for such
determination and (B) the number of additional
shares of Steel Stock offered for subscription
or purchase pursuant to such rights or warrants.
Such adjustment shall become effective
immediately after the opening of business on the
day next following such record date (except as
provided in Section 4(m)). In determining
whether any rights or warrants entitle the
holders of Steel Stock to subscribe for or
purchase shares of Steel Stock at less than the
Current Market Price thereof, there shall be
taken into ac count any consideration received
by the Corporation upon issuance and upon
exercise of such rights or warrants, the value
of such consideration, if other than cash, to be
determined by the Board of Directors.
(iii) If the Corporation shall
distribute to all holders of the Steel Stock any
shares of capital stock (other than common stock
of the Corpo ration), evidences of indebtedness,
cash or other assets of the Corporation
(including securities, but excluding (w) any
dividend or distribution referred to in Section
4(d)(i), (x) any rights or warrants referred to
in Section 4(d)(ii) or in the second or third
paragraph of this Section 4(d)(iii), (y) any
dividend or distribution paid exclusively in
cash or (z) any stocks, securities or other
property received as a result of a transaction
referred to in Section 4(f)) (any of the
foregoing being hereinafter referred to in this
Section 4(d)(iii) as the "Securities"), then in
each such case the Conversion Price shall be
adjusted so that it shall equal the price
determined by multiplying (I) the Conversion
Price in effect immediately prior to the close
of business on the date fixed for the
determination of stockholders entitled to
receive such distribution by (II) a fraction,
the numerator of which shall be the Current
Market Price per share of the Steel Stock on the
record date mentioned below less the then fair
market value (as deter mined by the Board of
Directors) of the portion of the Securities so
distributed to one share of Steel Stock, and the
denominator of which shall be the Current Market
Price per share of the Steel Stock on the record
date mentioned below. Such adjustment shall
become effective immediately at the opening of
business on the day next following the record
date for the determination of stockholders
entitled to receive such distribution (except as
provided in Section 4(m)).
With respect to the Amended and Restated Rights
Agreement, dated as of October 1, 1992 (as amended or
otherwise modified from time to time, the "Restated
Rights Agreement"), between the Corporation and Mellon
Bank, N.A. (terms used in this paragraph and not
otherwise defined herein having the mean ings set forth
in the Restated Rights Agreement), the Conversion Price
will be adjusted only when the Rights issuable pursuant
thereto become exercisable after the Corporation's right
of redemption thereunder has expired. Subject to the
foregoing, upon the later to occur of the Distribution
Date and a Section 11(a)(ii) Event (the "Adjustment
Date"), the Conversion Price in effect at the opening of
business on the Adjustment Date shall be adjusted to
equal the price determined by multiplying such Conversion
Price by a fraction the numerator of which shall be equal
to the Current Market Price per share of the Steel Stock
on the Trading Day immediately prior to the Adjustment
Date less an amount equal to the quotient of (x) the
aggregate fair market value on the Adjustment Date (as
determined by the Board of Directors) of the Rights
distributed under the Restated Rights Agreement divided
by (y) the number of shares of Steel Stock outstanding on
such day prior to the Adjustment Date and the denominator
of which shall be equal to such Current Market Price per
share of the Steel Stock. Such adjustment shall become
effective immediately after the opening of business on
the day next following such Adjustment Date.
In case the Corporation shall (other than
pursuant to the Restated Rights Agreement) distribute
rights or warrants to purchase Steel Stock pro rata to
all holders of Steel Stock which rights or warrants are
not at such time immediately exercisable but, upon the
occurrence of a specified event or events ("Exercise
Trigger Date") will become exercisable and once they
become exercisable will entitle, or upon the occurrence
of an additional specified event or events ("Price
Trigger Date") will entitle, the holder thereof to
purchase Steel Stock at a price per share of Steel Stock
less than the Current Market Price of the Steel Stock on
the Trading Day next succeeding the later of the Exercise
Trigger Date or the Price Trigger Date ("Adjustment
Trigger Date") and there shall have occurred such
Adjustment Trigger Date, thus permitting the holders of
such rights or warrants irrevocably to exercise any
exchange, subscription or purchase rights conferred by
such rights or warrants at a price per share of Steel
Stock less than such Current Market Price, then the
Conversion Price in effect at the opening of business on
the Adjustment Trigger Date shall be adjusted by
multiplying (I) such Conversion Price by (II) a fraction,
the numerator of which shall be equal to the Current
Market Price per share of the Steel Stock on the Trading
Day immediately prior to the Adjustment Trigger Date less
an amount equal to the quotient of (x) the aggregate fair
market value on the Adjustment Trigger Date of the rights
or warrants so distributed (as determined by the Board of
Directors) divided by (y) the number of shares of Steel
Stock outstanding on such day prior to the Adjustment
Trigger Date and the denominator of which shall be equal
to such Current Market Price per share of the Steel
Stock. Such adjustment shall become effective immediately
after the opening of business on the day next following
such Adjustment Trigger Date.
(iv) If the Corporation shall, by
dividend or otherwise, at any time distribute to
all holders of the Steel Stock cash (excluding
any regular quarterly dividend payable solely in
cash, any cash that is distributed as part of a
distribution requiring a Conversion Price
adjustment pursuant to Section 4(d)(iii) and
cash that is distributed in a merger or
consolidation to which Section 4(f) applies) in
an aggregate amount that, together with (A) the
aggregate amount of any other distributions to
all holders of the Steel Stock made exclusively
in cash (to which this Section 4(d)(iv) would
otherwise apply) within the 12 months preceding
the date of payment of such distribution and in
respect of which no Conversion Price adjustment
has been made and (B) all Excess Purchase
Payments in respect of each tender offer or
exchange offer or other negotiated purchase for
Steel Stock concluded by the Corporation or any
of its Subsidiaries within the 12 months
preceding the date of payment of such
distribution and in respect of which no
Conversion Price adjustment has been made,
exceeds an amount equal to 12 1/2% of the
product of the Current Market Price per share of
Steel Stock on the date fixed for determination
of holders of Steel Stock entitled to receive
such distribution times the number of shares of
Steel Stock outstanding on such date, then the
Conversion Price shall be adjusted so that it
shall equal the price determined by multiplying
(I) such Conversion Price in effect immediately
prior to the Conversion Price adjustment
contemplated by this Section 4(d)(iv) by (II) a
fraction the numerator of which shall be the
Current Market Price per share of the Steel
Stock on the date fixed for determination of
holders of Steel Stock entitled to receive such
distribution less the combined amount of such
cash and such Excess Purchase Payments so
distributed applicable to one share of Steel
Stock and the denominator of which shall be such
Current Market Price per share of the Steel
Stock on such date of determination. Such
adjustment shall become effective immediately
prior to the opening of business on the day next
following the date fixed for such determination.
(v) In case a tender offer or exchange
offer or other negotiated purchase made by the
Corporation or any of its Subsidiaries for all
or any portion of the Steel Stock shall be
consummated, if the aggregate amount of any
Excess Purchase Payment, together with (A) the
aggregate amount of any distributions made to
all holders of Steel Stock made exclusively in
cash (excluding any regular quarterly dividend
payable solely in cash, any cash that is
distributed as part of a distribution requiring
a Conversion Price adjustment pursuant to
Section 4(d)(iii) and cash that is distributed
in a merger or consolidation to which Section
4(f) applies) within the 12 months preceding the
consummation of such tender or exchange offer or
other negotiated purchase and in respect of
which no Conversion Price adjustment has been
made, and (B) all other Excess Purchase Payments
in respect of each tender or exchange offer or
other negotiated purchase for Steel Stock
concluded by the Corporation or any of its
Subsidiaries within the 12 months preceding the
consummation of such tender or exchange offer or
other negotiated purchase and in respect of
which no Conversion Price adjustment has been
made, exceeds an amount equal to 12 1/2% of the
product of the Current Market Price per share of
Steel Stock on the consummation date of such
tender or exchange offer or other negotiated
purchase (any such date, the "Purchase Date")
times the number of shares of Steel Stock
outstanding (including any tendered, exchanged
or pur chased shares) on such Purchase Date,
then the Conversion Price shall be adjusted so
that it shall equal the price determined by
multiplying (I) such Conversion Price in effect
immediately prior to such Purchase Date by (II)
a fraction, the numerator of which shall be the
Current Market Price per share of the Steel
Stock on such Purchase Date less the combined
amount of Excess Purchase Payments and such cash
so distributed applicable to one share of Steel
Stock and the denominator of which shall be such
Current Market Price per share on such Purchase
Date. Such adjustment shall become effective
immediately prior to the opening of business on
the day next following such Purchase Date.
(vi) The Corporation from time to time
may reduce the Conver sion Price by any amount
for any period of at least 20 business days (or
such other period as may then be required by
applicable law), provided that the Board of
Directors shall have determined that such
reduction is in the best interests of the
Corporation. No reduction in the Conversion
! Price pursuant to this Section 4(d)(vi) shall
become effective unless the Corpo ration shall
have mailed a notice, at least 15 days prior to
the date on which such reduction is scheduled to
become effective, to each holder of shares of
this Series. Such notice shall be given by first
class mail, post age prepaid, at such holder's
address as the same appears on the stock
transfer books of the Corporation. Such notice
shall state the amount per share by which the
Conversion Price will be reduced and the period
for which such reduction will be in effect.
(vii) The Corporation may make such
reductions in the Conver sion Price, in addition
to those required by Sections 4(d)(i) through
(v), as the Board determines to be necessary in
order that any event treated for Federal income
tax purposes as a dividend of stock or stock
rights will not be taxable to the recipients;
provided that any such reduction shall not be
effective until written evidence of the action
of the Board authorizing such reduction shall be
filed with the Secretary of the Corporation and
notice thereof shall have been given by first
class mail, postage prepaid, to each holder of
shares of this Series at such holder's address
as the same appears on the stock transfer books
of the Corporation.
(e) No adjustment in the Conversion Price shall
be required unless such adjustment would require a
cumulative increase or decrease of at least 1% in such
price; provided, however, that any adjustments that by
reason of this Section 4(e) are not required to be made
shall be carried forward and taken into account in any
subsequent adjustment until made; and provided, further,
that any adjustment shall be required and made in
accordance with the provisions of this Section 4 (other
than this Section 4(e)) not later than such time as may
be required in order to preserve the tax-free nature of a
distribution to the holders of shares of Steel Stock or
any other common stock into which shares of this Series
! are convertible.
Notwithstanding any other provisions of this Section 4,
the Corporation shall not be required to make any
adjustment of any Conversion Price established hereun der
for the issuance of any shares of common stock of the
Corporation (including Steel Stock) pursuant to any plan
providing for the reinvestment of dividends or interest
payable on securities of the Corporation and the
investment of additional optional amounts in shares of
such common stock under such plan. All calcula tions
under this Section 4 shall be made to the nearest 1/100
of a cent (with $.00005 being rounded upward) or to the
nearest 1/10,000 of a share (with .00005 of a share being
rounded upward), as the case may be.
(f) If the Corporation shall be a party to any
transaction (including without limitation a merger or
consolidation of the Corporation and excluding any
transaction as to which Sections 4(d)(i) through (vi)
apply), in each case as a result of which shares of Steel
Stock shall be converted into the right to receive stock,
securities or other property (including cash or any
combination thereof), (each of the foregoing being
referred to herein as a "Transaction"), each share of
this Series which is not converted into the right to
receive stock, securities or other property in connection
with such Transaction shall thereafter be convertible
into the kind and amount of shares of stock, securities
and other property (includ ing cash or any combination
thereof) receivable upon the consummation of such
Transaction by a holder of that number of shares or
fraction thereof of Steel Stock into which one share of
this Series was convertible immediately prior to such
Transaction, assuming such holder of Steel Stock (i) is
not a person with which the Corporation consolidated or
into which the Corporation merged or which merged into
the Corporation or to which such sale or transfer was
made, as the case may be (a "Constituent Person"), or an
affiliate of a Constituent Person and (ii) failed to
exercise his rights of election, if any, as to the kind
or amount of stock, securities and other property
(including cash) receivable upon such Trans action
(provided that if the kind or amount of stock, securities
and other property (including cash) receivable upon such
Transaction is not the same for each share of Steel Stock
of the Corporation held immediately prior to such
Transaction by other than a Constituent Person or an
affiliate thereof and in respect of which such rights of
election shall not have been exercised ("non-electing
share"), then for the purpose of this Section 4(f) the
kind and amount of stock, securities and other property
(including cash) receivable upon such Transaction by each
non-electing share shall be deemed to be the kind and
amount so receivable per share by a plurality of the
non-electing shares). The Corporation shall not be a
party to any Transaction unless the terms of such
Transaction are consistent with the provi sions of this
Section 4(f) and it shall not consent or agree to the
occurrence of any Transaction until the Corporation has
entered into an agreement with the other party or parties
to such transaction for the benefit of the holders of
shares of this Series that will contain provisions
enabling the holders of such shares that remain
outstanding after such Transaction to convert into the
consideration received by holders of Steel Stock at the
Conversion Price in effect immediately prior to such
Transaction. The provisions of this Section 4(f) shall
similarly apply to succes sive Transactions.
(g) The reclassification of common stock into
which shares of this Series are then convertible into
securities which include securities other than such
common stock (other than any reclassification upon a
consolidation or merger to which Section 4(f) applies),
shall be deemed to involve (i) a distribution of such
securities other than such common stock to all holders of
such common stock (and the effective date of such
reclassification shall be deemed to be "the date fixed
for the determination of stockholders entitled to receive
such distribution") and (ii) a subdivision or
combination, as the case may be, of the number of shares
of such common stock outstanding immediately prior to
such reclassification into the number of shares of such
common stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed
to be the effective date of such subdivision or
combination).
(h) If the Corporation shall, by dividend or
otherwise, distribute to all holders of Steel Stock or
other class of common stock into which shares of this
Series are then convertible shares of common stock other
than Steel Stock or any class of common stock into which
shares of this Series are then convertible, each share of
this Series shall be convertible, in addition to the
number of shares of Steel Stock and/or such other common
stock into which such share is then convertible, into the
number of shares of such other common stock receivable
upon payment of such distribution to a holder of that
number of shares or fraction thereof of Steel Stock or
such other common stock into which one share of this
Series was convertible immediately prior to the record
date fixed for the determi nation of stockholders
entitled to receive such distribution. Shares of this
Series shall become so convertible immediately after the
opening of business on the day next following such record
date (except as provided in Section 4(m)). In addition, a
Conversion Price shall be established with respect to
such common stock in an amount equal to the quotient of
(i) the initial liquidation preference of $50.00 per
share of this Series divided by (ii) the number of shares
or fraction thereof of such common stock that a holder of
one share of Steel Stock or such other common stock into
which shares of this Series are then convertible would be
entitled to receive on the payment date for such
distribution from and after any such date of
determination of stockholders entitled to receive such
distribution and, thereafter, Conversion Price
adjustments as nearly as equivalent in type as may be
practica ble to the adjustments pursuant to Sections 4(d)
through (f) which are to be made in respect of Steel
Stock shall be made in respect of shares of such common
stock. Notwithstanding the foregoing and the provisions
of Section 4(d)(iii), if the Corporation shall make such
a distribution in common stock and, thereafter, all of
the shares of such common stock cease to be outstanding,
on the date such shares of common stock cease to be
outstanding (x) the shares of this Series shall cease to
be convertible into shares of such common stock, (y) a
distribution of shares of such common stock shall be
deemed to have occurred on such date, and (z) the
Conversion Price for the class of common stock upon which
such distribution was made, or if no shares of such class
are then outstanding because shares of such class were
exchanged for shares of another class of common stock, of
such other class of common stock, shall be adjusted in
the manner set forth in Section 4(d)(iii) to the same
extent as if shares of the common stock in which such
distribution was made were within the meaning of the term
"Securities" in Section 4(d)(iii).
(i) After the date, if any, on which all
outstanding shares of Steel Stock or of any other common
stock into which shares of this Series are then
convertible are exchanged for shares of another class of
common stock (as provided in the Certificate of
Incorporation), each share of this Series shall
thereafter be convert ible into the number of shares of
such other class of common stock receivable upon such
exchange by a holder of that number of shares or fraction
thereof of Steel Stock and/or such other common stock
into which shares of this Series are then convertible
into which one share of this Series was convertible
immediately prior to such exchange. From and after any
such exchange, Conversion Price adjustments as nearly
equivalent as may be practicable to the adjustments pursu
ant to Sections 4(d) through 4(h) which, prior to such
exchange, were made in respect of Steel Stock and/or such
other common stock into which shares of this Series are
then convertible shall instead be made pursuant to such
Sections 4(d) through 4(h) in respect of shares of such
other class of common stock.
(j) Subject to the provisions of Section 4(k), if:
(i) the Corporation takes any action
that would require an adjust ment of the
Conversion Price pursuant to Sections 4(d)
through (i); or
(ii) there shall be any consolidation
or merger to which the Corporation is a party
and for which approval of any stockholders of
the Corporation is required, or the sale or
transfer of all or substantially all of the
assets of the Corporation or the U.S. Steel
Group; or
(iii) there shall occur the voluntary
or involuntary liquidation, dissolution or
winding up of the Corporation; or
(iv) the Corporation or any of its
Subsidiaries shall commence a tender offer or
exchange offer for all or a portion of the
outstanding shares of Steel Stock (or shall
amend any such tender or exchange offer), then
the Corporation shall cause to be filed with the
Transfer Agent and shall cause to be mailed to
the holders of shares of this Series at their
addresses as shown on the stock transfer books
of the Corporation, as promptly as possible, but
at least 15 days prior to the earliest
applicable date hereinafter specified, a notice
stating, as applicable, (A) the proposed record
date for a dividend or distribution or the
proposed effective date of a consolidation,
merger, sale, transfer, liquidation, dissolution
or winding up, (B) the date as of which it is
expected that holders of Steel Stock of record
shall be entitled to exchange their shares of
Steel Stock for securi ties or other property,
if any, deliverable upon such consolidation,
merger, sale, transfer, liquidation, dissolution
or winding up or (C) the date on which such
tender or exchange offer commenced, the date on
which such tender or exchange offer is scheduled
to expire unless extended, the consideration
offered and the other material terms thereof (or
the material terms of any amendment thereto).
Failure to give or receive such notice or any
defect therein shall not affect the legality or
validity of the related transaction.
(k) If the Corporation intends:
(i) to effect a U.S. Steel Group
Special Event or a Marathon Group Special Event;
or
(ii) exchange shares of Steel Stock for
Marathon Stock or Delhi Stock following a
Disposition of all or substantially all of the
properties and assets of the U.S. Steel Group,
then the Corporation shall cause to be filed
with the Transfer Agent and shall cause to be
mailed to the holders of shares of this Series
at their addresses as shown on the stock
transfer books of the Corporation, not less than
45 days prior to the Steel Group Disposition
Dividend or the Steel Group Disposition
Redemption and not less than 30 days prior to
any other U.S. Steel Group Special Event, any
Marathon Group Special Event or any such
exchange of Steel Stock for shares of Marathon
Stock or Delhi Stock, a notice stating, as
applicable, (A) the record date for any dividend
that is a U.S. Steel Group Special Event or a
Marathon Group Special Event, (B) the date on
which any redemption or exchange that is a U.S.
Steel Group Special Event, a Marathon Group
Special Event or an ex change of Steel Stock for
shares of Marathon Stock or Delhi Stock is
expected to become effective, and the date as of
which it is expected that holders of record of
Steel Stock or Marathon Stock shall be entitled
to exchange their shares of Steel Stock or
Marathon Stock, respectively, for securities or
other property deliverable upon such redemption
or exchange or (C) the date on which the Steel
Group Tender or Exchange Offer or the Marathon
Group Tender or Exchange Offer commenced, the
consideration offered and the other material
terms thereof (or the material terms of any
amendment thereto). In addition, from and after
any exchange of Steel Stock for Delhi Stock,
effected in accordance with Section 2(b)(i) of
Division I of the Certificate of Incorporation,
the Corporation shall give similar notice of its
intention to exchange Delhi Stock for shares of
the Delhi Group Subsidiary, if Steel Stock has
been exchanged therefor, or to pay a dividend
on, or redeem shares of, Delhi Stock following
the Disposi tion of all or substantially all of
the properties and assets of the Delhi Group.
Failure to give or receive any such notice or
any defect therein shall not affect the legality
or validity of the related transaction. In the
event of any conflict between the notice
provisions of this paragraph (k) and paragraph
(j) above, the notice provisions of this
paragraph (k) shall govern.
(l) Whenever the Conversion Price is adjusted as
herein provided, the Corporation shall promptly file with
the Transfer Agent an officer's certificate setting forth
the Conversion Price after such adjustment and setting
forth a brief statement of the facts requiring such
adjustment, which certificate shall be prima facie
evidence of the correctness of such adjustment. Promptly
after delivery of such certificate, the Corporation shall
prepare a notice of such adjustment of the Conversion
Price setting forth the adjusted Conversion Price and the
effective date of such adjustment and shall send such
notice of such adjustment of the Conversion Price by
first class mail, postage prepaid, to the holder of each
share of this Series at such holder's address as the same
appears on the stock transfer books of the Corporation.
(m) In any case in which Section 4(d) or 4(h)
provides that an adjust ment shall become effective on
the day next following a record date for an event, the
Corporation may defer until the occurrence of such event
(A) issuing to the holder of any share of this Series
converted after such record date and before the
occurrence of such event the additional shares of Steel
Stock or any other com mon stock of the Corporation
issuable upon such conversion by reason of the adjustment
required by such event over and above the number of
shares of Steel Stock or such other common stock issuable
upon such conversion before giving effect to such
adjustment and (B) paying to such holder any amount in
cash in lieu of any fraction thereof pursuant to Section
4(c).
(n) For purposes of this Section 4, the number
of shares of Steel Stock or any other common stock of the
Corporation at any time outstanding shall not include any
shares of Steel Stock or such other common stock then
owned or held by or for the account of Corporation. The
Corporation shall not pay a dividend or make any
distribution on shares of Steel Stock or such other
common stock held in the treasury of the Corporation.
(o) There shall be no adjustment of the
Conversion Price in case of the issuance of any stock of
the Corporation in a reorganization, acquisition or other
similar transaction except as specifically set forth in
this Section 4. If any action or transaction would
require adjustment of any Conversion Price established
hereunder pursuant to more than one paragraph of this
Section 4, only the adjust ment which would result in the
largest reduction of such Conversion Price shall be made.
(p) The Corporation covenants that it will at
all times reserve and keep available, free from
preemptive rights, out of the aggregate of its authorized
but unissued shares of Steel Stock and/or, if the shares
of this Series are then convert ible into other common
stock of the Corporation, such other common stock, or its
issued shares of Steel Stock or such other common stock,
as the case may be, held in its treasury, or both, for
the purpose of effecting conversion of shares of this
series, the full number of shares of Steel Stock or such
other common stock deliverable upon the conversion of all
outstanding shares of this Series not theretofore
converted. For purposes of this Section 4(p), the number
of shares of Steel Stock or such other common stock that
shall be deliverable upon the conversion of all
outstanding shares of this Series shall be computed as if
at the time of computation all such outstanding shares
were held by a single holder.
The Corporation covenants that any shares of Steel Stock
or other common stock of the Corporation issued upon conversion of
shares of this Series shall be validly issued, fully paid and
nonassessable.
The Corporation shall endeavor to list the shares of
Steel Stock or other common stock of the Corporation required to
be delivered upon conversion of shares of this Series, prior to
such delivery, upon each national securities exchange, if any,
upon which the outstanding Steel Stock or such other common stock
is listed at the time of such delivery.
Prior to the delivery of any securities that the
Corporation shall be obligated to deliver upon conversion of
shares of this Series, the Corporation shall endeavor to comply
with all federal and state laws and regulations thereunder
requiring the registra tion of such securities with, or any
approval of or consent to the delivery thereof by, any
governmental authority.
(q) The Corporation will pay any and all
documentary, stamp or similar issue or transfer taxes
payable in respect of the issue or delivery of shares of
Steel Stock or other securities or property on conversion
of shares of this Series pursuant hereto; provided,
however, that the Corporation shall not be required to
pay any tax that may be payable in respect of any
transfer involved in the issue or delivery of shares of
Steel Stock or other securities or property in a name
other than that of the holder of such shares to be
converted and no such issue or delivery shall be made
unless and until the person requesting such issue or
delivery has paid to the Corporation the amount of any
such tax or established, to the reason able satisfaction
of the Corporation, that such tax has been paid.
5. Voting. The shares of this Series shall not have any
voting powers, either general or special, except that:
(a) Unless the vote or consent of the holders of
a greater number of shares shall then be required by law,
the consent of the holders of at least 66 2/3% of all of
the shares of this Series at the time outstanding, given
in person or by proxy, either in writing or by a vote at
a meeting called for the purpose at which the holders of
shares of this Series shall vote together as a separate
class, shall be necessary for authorizing, effecting or
validating the amendment, alteration or repeal of any of
the provisions of the Certificate of Incorporation or of
any certificate amendatory thereof or supplemental
thereto (including any Certificate of Designation and
Terms or any similar document relating to any series of
Preferred Stock) so as to affect adversely the powers,
preferences, or rights, of this Series. The increase of
the authorized amount of the Preferred Stock, or the
creation or authorization of any shares of any other
class of stock of the Corpora tion ranking prior to or on
a parity with the shares of this Series as to dividends
or upon liquidation, or the reclassification of any
authorized stock of the Corporation into any such parity
shares, or the creation or authorization of any
obligation or security convertible into or evidencing the
right to purchase any such prior or parity shares shall
not be deemed to affect adversely the powers, preferences
or rights of this Series.
(b) Unless the vote or consent of the holders of
a greater number of shares shall then be required by law,
the consent of the holders of at least 66 2/3% of all of
the shares of this Series and all other series of
Preferred Stock ranking on a parity with shares of this
Series, either as to dividends or upon liquidation, at
the time outstanding, given in person or by proxy, either
in writing or by a vote at a meeting called for the
purpose at which the holders of shares of this Series and
such other series of Preferred Stock shall vote together
as a single class without regard to series, shall be
necessary for authorizing, effecting or validating the
issuance of any shares of any class of stock of the
Corporation ranking prior to the shares of this Series as
to dividends or upon liquidation, or the reclassification
of any outstanding stock of the Corporation into any such
prior shares, or the issuance of any obligation or
security convertible into or evidencing the right to
purchase any such prior shares.
(c) Unless the vote or consent of the holders of
a greater number of shares shall then be required by law,
the consent of the holders of at least a majority of all
of the shares of this Series and all other series of
Preferred Stock ranking on a parity with this Series,
either as to dividends or upon liquidation, at the time
outstanding, given in person or by proxy, either in
writing or by a vote at a meeting called for the purpose
at which the holders of shares of this Series and such
other series of Preferred Stock shall vote together as a
single class without regard to series, shall be necessary
for authorizing, effecting or validating the merger or
consolidation of the Corporation into or with any other
corporation if such merger or consolidation would
adversely affect the powers, preferences or rights of
this Series or such other series of Preferred Stock or
if, after such merger or consolidation, there shall be
outstanding any shares of any class of stock ranking
prior to the shares of this Series as to dividends or
upon liquidation or any obligation or security
convertible into or evidencing the right to purchase any
such prior shares (except such stock, securities or
obligations of the Corporation as may have been
outstanding immediately preceding such merger or
consolida tion).
(d) If, on the date used to determine
stockholders of record for any meeting of stockholders
for the election of directors, a default in preference
dividends on the Preferred Stock shall exist, the number
of directors constituting the Board of Directors shall be
increased by two, and the holders of the Preferred Stock
of all series (whether or not the holders of such series
of Preferred Stock would be entitled to vote for the
election of directors if such default in preference
dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard
to series, to the exclusion of the holders of Common
Stock of the Corporation, to elect two directors of the
Corporation to fill such newly created directorships.
Each director elected by the holders of shares of
Preferred Stock (herein called a "Preferred Director"),
shall continue to serve as such director for the full
term for which such director shall have been elected,
notwithstanding that prior to the end of such term a
default in preference divi dends shall cease to exist.
Any Preferred Director may be removed without cause by,
and shall not be removed without cause except by, the
vote of the holders of record of the outstanding shares
of Preferred Stock, voting together as a single class
without regard to series, at a meeting of the
stockholders, or of the holders of shares of Preferred
Stock, called for the purpose. So long as a default in
any preference dividends on the Preferred Stock shall
exist (A) any vacancy in the office of a Preferred
Director may be filled (except as provided in the
following clause (B)) by an instrument in writing signed
by the remaining Preferred Director and filled with the
Corporation and (B) in the case of the removal of any
Preferred Director, the vacancy may be filed by the vote
of the holders of the outstanding shares of Preferred
Stock, voting together as a single class without regard
to series, at the same meeting at which such removal
shall be voted. Each director appointed as aforesaid by
the remaining Preferred Director shall be deemed, for all
purposes hereof, to be a Preferred Director. Whenever the
term of office of the Preferred Directors shall end and
no default in preference dividends shall exist, the
number of directors constituting the Board of Directors
shall be reduced by two. For the purposes hereof, a
"default in preference dividends" on the Preferred Stock
shall be deemed to have occurred whenever the amount of
accrued and unpaid dividends upon any series of the
Preferred Stock shall be equivalent to six full quarterly
dividends or more (whether or not consecutive), and,
having so occurred, such default shall be deemed to exist
thereafter until, but only until, all accrued dividends
on all shares of Preferred Stock of each and every series
then outstanding shall have been paid for all past
dividend periods.
6. Liquidation Rights.
(a) Upon the dissolution, liquidation or winding
up of the Corporation, whether voluntary or involuntary,
the holders of the shares of this Series shall be
entitled to receive out of the assets of the Corporation
available for distribution to stockholders, before any
payment or distribution shall be made on any class of the
common stock of the Corporation or on any other class of
stock ranking junior to the Preferred Stock upon
liquidation, the amount of $50 per share, plus a sum
equal to all dividends (whether or not earned or
declared) on such shares accrued and unpaid thereon to
the date of final distribution.
(b) Neither the sale, lease of exchange (for
cash, shares of stock, securi ties or other
consideration) of all or substantially all the property
and assets of the Corporation nor the merger or
consolidation of the Corporation into or with any other
corporation or the merger or consolidation of any other
corporation into or with the Corporation, shall be deemed
to be a dissolution, liquidation or winding up, voluntary
or involuntary, for the purpose of this Section 6.
(c) After the payment to the holders of the
shares of this Series of the full preferential amounts
provided for in this Section 6, the holders of shares of
this Series as such shall have no right or claim to any
of the remaining assets of the Corporation.
(d) In the event the assets of the Corporation
available for distribution to the holders of shares of
this Series upon any dissolution, liquidation or winding
up of the Corporation, whether voluntary or involuntary,
shall be insufficient to pay in full all amounts to which
such holders are entitled pursuant to Section 6(a), no
such distribution shall be made on account of any shares
of any other class or series of Preferred Stock ranking
on a parity with the shares of this Series upon such
dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on
account of the shares of this Series, ratably, in propor
tion to the full distributable amounts for which holders
of all such parity shares are respectively entitled upon
such dissolution, liquidation or winding up.
7. Ranking. For purposes of this resolution, any stock of
any class or classes of the Corporation shall be deemed to rank:
(a) prior to the shares of this Series, either
as to dividends or upon liquidation, if the holders of
such class or classes shall be entitled to the receipt of
dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in
preference or priority to the holders of shares of this
Series;
(b) on a parity with the shares of this Series,
either as to dividends or upon liquidation, whether or
not he dividend rates, dividend payment dates or
redemption or liquidation prices per share or sinking
fund provisions, if any, be different from those of this
Series, if the holders of such stock shall be entitled to
the receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the
case may be, in proportion to their respective dividend
rates or liquidation prices, without preference or
priority, one over the other, as between the holders of
such stock and the holders of shares of this Series; and
(c) junior to shares of this Series, either as
to dividends or upon liquida tion, if such class or
classes shall be the Series A Junior Preferred Stock
issued by the Corporation pursuant to the Restated Rights
Agreement or if such class or classes shall be any class
of common stock of the Corporation or if the holders of
shares of this Series shall be entitled to receipt of
dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in
preference or priority to the holders of shares of such
class or classes.
8. Determinations by the Board of Directors. Any
determinations made by the Board of Directors of the Corporation
under any provision of this Resolution shall be final and binding
on all stockholders (including holders of shares of this Series)
of the Corporation.
9. Definitions. Unless otherwise defined herein, terms
used herein shall have the meanings assigned to them in Division I
of the Certificate of Incorporation and the following terms shall
have the following meanings:
"Board of Directors" or "Board" means, at any time, the
duly elected or acting board of directors (or duly authorized
committee thereof) of the Corporation at such time.
"Certificate of Incorporation" means the Corporation's
Certificate of Incorpora tion, as amended, supplemented or
otherwise modified from time to time.
"Closing Price" of shares of any class of common stock of
the Corporation for any day shall mean the last reported sales
price, regular way on such day, or, if no reported sale takes
place on such day, the average of the reported closing bid and
asked prices on such day, regular way, in either case as reported
on the New York Stock Exchange Composite Tape or, if such common
stock is not listed or admitted to trading on the NYSE, on the
principal national securities exchange on which such common stock
is listed or admitted to trading or, if not listed or admitted to
trading on any national securities exchange, on the National
Market System of NASDAQ or, if such common stock is not quoted on
such National Market System, the average of the closing bid and
asked prices on such day in the over-the-counter market as
reported by NASDAQ, or, if closing bid and asked prices for such
common stock on such day shall not have been reported through
NASDAQ, the average of the closing bid and asked prices on such
day as furnished by any NYSE member firm regularly making a market
in such common stock selected for such purpose by the Board of
Directors.
"Conversion Price" means the conversion price per share
of Steel Stock and/or other shares of common stock of the
Corporation into which shares of this Series are convertible, as
such Conversion Price may be adjusted pursuant to Section 4. The
initial conversion price per share of Steel Stock will be $46.125
(equivalent to a conversion rate of 1.084 shares of Steel Stock
for each share of this Series).
"Current Market Price" shall mean, with respect to any
class of common stock of the Corporation, the average of the daily
Closing Prices of a share of such common stock during the five
consecutive Trading Days selected by the Corporation commencing
not more than 20 Trading Days before, and ending not later than,
the date in question; provided, however, that (i) if the "ex" date
for any event (other than the issuance or distribution requiring
such computation) that requires an adjustment to the Conversion
Price pursuant to Sections 4(d)(ii) through (v) occurs on or after
the 20th Trading Day prior to the day in question and prior to the
"ex" date for the issuance or distribution requiring such
computation, the Closing Price for each Trading Day prior to the
"ex" date for such other event shall be adjusted by multiplying
such Closing Price by the same fraction by which the Conversion
Price is so required to be adjusted as a result of such other
event, (ii) if the "ex" date for any event (other than the
issuance or distribution requiring such computation) that requires
an adjustment to the Conversion Price pursuant to Sections
4(d)(ii) through (v) occurs on or after the "ex" date for the
issuance or distribution requiring such computation and on or
prior to the day in question, the Closing Price for each Trading
Day on and after the "ex" date for such other event shall be
adjusted by multiplying such Closing Price by the reciprocal of
the fraction by which the Conversion Price is so required to be
adjusted as a result of such other event, and (iii) if the "ex"
date for the issuance or distribution requiring such computation
is on or prior to the day in question, after taking into account
any adjustment required pursuant to clause (ii) of this proviso,
the Closing Price for each Trading Day on or after such "ex" date
shall be adjusted by adding thereto the amount of any cash and the
fair market value on the day in question (as determined by the
Board of Directors in a manner consistent with any determination
of such value for purposes of Section 4(d)(iii) or (iv)) of the
evidences of indebtedness, shares of capital stock or assets being
distributed applicable to one share of the applicable class of
common stock of the Corporation as of the close of business on the
day before such "ex" date. For purposes of this definition, the
term "ex" date, with respect to any class of common stock of the
Corporation, (i) when used with respect to any issuance or
distribution, means the first date on which such common stock
trades regular way on such exchange or in the relevant market from
which the Closing Price was obtained without the right to receive
such issuance or distribution, (ii) when used with respect to any
subdivision or combination of shares of such common stock, means
the first date on which such common stock trades regular way on
such exchange or in such market after the time at which such
subdivision or combination becomes effec tive, and (iii) when used
with respect to any tender or exchange offer means the first date
on which such common stock trades regular way on such exchange or
in such market after the expiration time of such tender or
exchange offer.
"Excess Purchase Payment" means the excess, if any, of
(A) the aggregate of the cash and the value (as determined by the
Board of Directors) of all other consideration paid by the
Corporation or any of its Subsidiaries with respect to the shares
of the applicable class of common stock of the Corporation
acquired in a tender or exchange offer or other negotiated
purchase respectively, over (B) the product of the Current Market
Price per share of such common stock times the number of shares of
such common stock acquired in such tender or exchange offer or
purchase.
"NASDAQ" means the National Association of Securities
Dealers, Inc. Auto mated Quotations System or any successor
thereto.
"NYSE" means the New York Stock Exchange, Inc. or any
successor thereto.
"Redemption Date" means any date on which the Corporation
redeems any shares of this Series.
"Redemption Price" means (i) with respect to any
redemption pursuant to Section 3(a), the applicable amount set
forth in such Section and (ii) with respect to any redemp tion
pursuant to Section 3(b), an amount per share equal to the sum of
the initial liquida tion preference of $50.00 per share of this
Series, plus an amount equal to all accrued and unpaid dividends
thereon to the date fixed for redemption.
"Restated Rights Agreement" shall have the meaning given
to it in the second paragraph of Section 4(d)(iii).
"Rights" shall mean the rights of the Corporation which
are issuable under the Corporation's stockholder rights plan
adopted by the Board of Directors, the terms and conditions of
which are set forth in the Restated Rights Agreement, or rights to
purchase any capital stock of the Corporation under any successor
shareholder rights plan or plan adopted in replacement of the
Corporation's stockholder rights plan.
"Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or
indirectly, by the Corporation or by one or more other
Subsidiaries. For the purposes of this definition, "voting stock"
means stock which ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class
of stock has such voting power by reason of any contingency.
"substantially all of the properties and assets of the
U.S. Steel Group" and "substantially all of the properties and
assets for the Marathon Group" shall mean a portion of such
properties and assets that represents at least 80% of either of
the then- current market value of, or the aggregate revenues for
the immediately preceding twelve fiscal quarterly periods of the
Corporation derived from, the properties and assets of the U.S.
Steel Group or the Marathon Group, respectively, as of such date
(excluding the properties and assets of any person, entity or
group in which the Corporation, directly or indirectly, owns less
than a majority interest).
"Trading Day" shall mean, with respect to any class of
common stock of the Corporation, any day on which such common
stock is traded on the NYSE, or if such common stock is not listed
or admitted to trading on the NYSE, on the principal national
securities exchange on which such common stock is listed or
admitted, or if not listed or admitted to trading on any national
securities exchange, on the National Market System of the NASDAQ,
or if such common stock is not quoted on such National Market
System, in the applicable securities market in which such common
stock is traded.
"Transfer Agent" means the Corporation, through its
Shareholder Services Department, or such other agent or agents of
the Corporation as may be designated by the Board of Directors as
the Transfer Agent for shares of this Series.
FIFTH: The existence of the Corporation is to be perpetual.
SIXTH: The private property of the stockholders shall not be
subject to the payment of corporate debts to any extent whatever.
SEVENTH: The number of directors of the Corporation shall be
fixed from time to time by, or in the manner provided in, its by-laws and
may be increased or decreased as therein provided; but the number thereof
shall not be less than three.
The directors of the Corporation shall be divided into three
classes: Class I, Class II and Class III. Each class shall consist, as
nearly as may be possible, of one-third of the whole number of the Board of
Directors. In the election of directors at the 2002 annual meeting of the
stockholders, the Class I directors shall be elected to hold office for a
term to expire at the first annual meeting of the stockholders thereafter;
the Class II directors shall be elected to hold office for a term to expire
at the second annual meeting of the stockholders thereafter; and the Class
IIII directors shall be elected to hold office for a term to expire at the
third annual meeting of the stockholders thereafter, and in the case of
each class, until their respective successors are duly elected and
qualified. At each annual election held after the 2002 annual meeting of
the stockholders the directors elected to succeed those whose terms expire
shall be identified as being of the same class as the directors they
succeed and shall be elected to hold office for a term to expire at the
third annual meeting of the stockholders after their election, and until
their respective successors are duly elected and qualified. If the number
of directors is changed, any increase or decrease in directors shall be
apportioned among the classes so as the maintain all classes as equal in
number as possible, and any additional director elected to any class shall
hold office for a term which shall coincide with the terms of the other
directors in such class and until his successor is duly elected and
qualified.
In the case of any increase in the number of directors of the
Corporation, the additional director or directors shall be elected by the
Board of Directors.
In the case of any vacancy in the Board of Directors from death,
resignation, disqualifica tion or other cause, a successor to hold office
for the unexpired portion of the term of the director whose place shall be
vacant, and until the election of his successor, shall be elected by a
majority of the Board of Directors then in office, though less than a
quorum.
Directors of the Corporation may be removed only for cause.
EIGHTH: The Board of Directors shall have power to adopt, amend
and repeal the by- laws at any regular or special meeting of the Board of
Directors, provided that notice of intention to adopt, amend or repeal the
by-laws in whole or in part shall have been included in the notice of
meeting; or, without any such notice, by a vote of two-thirds of the
directors then in office.
Stockholders may adopt, amend and repeal the by-laws at any
regular or special meeting of the stockholders by an affirmative vote of
two-thirds of the shares outstanding and entitled to vote thereon, provided
that notice of intention to adopt, amend or repeal the by-laws in whole or
in part shall have been included in the notice of the meeting.
Any action required to be taken at any annual or special meeting
of the stockholders of the Corporation, or any action which may be taken at
any annual or special meeting of the stockholders or otherwise, may not be
taken without a meeting, prior notice and a vote, and stockholders may not
act by written consent.
NINTH: The Board of Directors from time to time shall determine
whether and to what extent, and at what times and places, and under what
conditions and regulation, the accounts and books of the Corporation, or
any of them, shall be open to the inspection of the stockholders, and no
stockholder shall have any right to inspect any account or book or document
of the Corpora tion, except as conferred by law or authorized by the Board
of Directors, or by the stockholders.
TENTH: The directors may from time to time declare such dividends
as they shall deem advisable and proper, subject to the provisions of
Article Fourth and to such restrictions as may be imposed by law, and pay
the same to the stockholders at such times as they shall fix.
The Board of Directors shall have power to issue bonds,
debentures, or other obligations, either non-convertible or convertible
into the Corporation's stock, subject to the provisions of Article Fourth
and upon such terms, in such manner and under such conditions in conformity
with law, as may be fixed by the Board of Directors prior to the issue of
such bonds, debentures or other obligations.
ELEVENTH: No director shall be personally liable to the
Corporation or its stockholders for monetary damages for any breach of
fiduciary duty by such director as a director, except (i) for breach of the
director's duty of loyalty to the Corporation or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct
or knowing violation of law, (iii) pursuant to Section 174 of the Delaware
General Corporation Law, or (iv) for any transac tion from which the
director derived an improper personal benefit. No amendment to or repeal of
this Article Twelfth shall apply to or have any effect on the liability or
alleged liability of any director of the Corporation for or with respect to
any acts or omissions of such director occurring prior to such amendment or
repeal.
TWELFTH: The powers and authorities hereinbefore conferred upon
the Board of Directors are in furtherance and not in limitation of those
conferred by the laws of the State of Delaware.
THIRTEENTH: The Corporation reserves the right at any time and
from time to time to amend, alter, change or repeal any provisions
contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by law, and all rights preferences and privileges of
whatso ever nature conferred upon stockholders, directors or any other
persons whomsoever 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.
In Witness Whereof, this Restated Certificate of Incorporation,
which amends and restates the provisions of the Corporation's Certificate
of Incorporation, having been duly adopted by the Corporation in accordance
with the provisions of Section 245 of the General Corporation Law of the
State of Delaware, has been executed on the 2nd day of July, 2001.
USX HOLDCO, INC.
BY:/s/ Robert M. Stanton
-----------------
Robert M. Stanton
President