Exhibit 3.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
CHICAGO MERCANTILE EXCHANGE HOLDINGS INC.
Pursuant to Sections 242 and 245 of the
Delaware General Corporation Law
Chicago Mercantile Exchange Holdings Inc. (the
"Corporation"), a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "GCL"), does hereby certify as
follows:
(1) The name of the Corporation is Chicago Mercantile
Exchange Holdings Inc. The Corporation was originally incorporated under the
name Chicago Mercantile Exchange Holdings Inc. The original certificate of
incorporation of the Corporation was filed with the office of the Secretary of
State of the State of Delaware on August 2, 2001.
(2) This Restated Certificate of Incorporation was duly
adopted by the Board of Directors of the Corporation and by the sole
stockholder of the Corporation in accordance with Sections 228, 242 and 245 of
the GCL.
(3) This Restated Certificate of Incorporation restates and
integrates and further amends the certificate of incorporation of the
Corporation, as heretofore amended or supplemented.
(4) The text of the Certificate of Incorporation is amended
and restated in its entirety as follows:
ARTICLE ONE: The name of the corporation is CHICAGO MERCANTILE
EXCHANGE HOLDINGS INC.
ARTICLE TWO: The address of the corporation's registered office in
the State of Delaware is 1209 Orange Street, City of Wilmington, County of New
Castle, Delaware 19801. The name of the corporation's registered agent at such
address is The Corporation Trust Company.
ARTICLE THREE: The purpose of the corporation shall be to engage in
any lawful act or activity for which corporations may be organized under the
General Corporation Law of the State of Delaware, as set forth in Title 8 of
the Delaware Code (the "DGCL").
ARTICLE FOUR: The total number of shares of all classes of capital
stock that the corporation is authorized to issue is 148,003,138 shares, of
which:
10,000,000 shares shall be shares of Preferred Stock, par value $.01
per share (the "Preferred Stock"), including 140,000 authorized
shares of Series A Junior Participating Preferred Stock (the "Series
A Junior Participating Preferred Stock");
100,000,000 shares shall be shares of Class A Common Stock, par value
$.01 per share (the "Class A Common Stock");
9,500,000 shares shall be shares of Class A-1 Common Stock, par value
$.01 per share (the "Class A-1 Common Stock");
9,500,000 shares shall be shares of Class A-2 Common Stock, par value
$.01 per share (the "Class A-2 Common Stock");
9,500,000 shares shall be shares of Class A-3 Common Stock, par value
$.01 per share (the "Class A-3 Common Stock");
9,500,000 shares shall be shares of Class A-4 Common Stock, par value
$.01 per share (the "Class A-4 Common Stock");
625 shares shall be shares of Class B-1 Common Stock, par value $.01
per share (the "Class B-1 Common Stock");
813 shares shall be shares of Class B-2 Common Stock, par value $.01
per share (the "Class B-2 Common Stock");
1,287 shares shall be shares of Class B-3 Common Stock, par value
$.01 per share (the "Class B-3 Common Stock"); and
413 shares shall be shares of Class B-4 Common Stock, par value $.01
per share (the "Class B-4 Common Stock").
The term "Common Stock" shall mean, collectively, the Class A Common
Stock, the Class A-1 Common Stock, the Class A-2 Common Stock, the Class A-3
Common Stock, the Class A-4 Common Stock, the Class B-1 Common Stock, the
Class B-2 Common Stock, the Class B-3 Common Stock and the Class B-4 Common
Stock. The board of directors is expressly authorized to designate and issue
any number of authorized but unissued shares of Class A Common Stock as Class
A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common Stock or Class A-4
Common Stock. The designations, voting powers, optional or other special
rights and the qualifications, limitations or restrictions thereof, of the
above classes shall be as follows:
DIVISION A
PREFERRED STOCK
The rights, preferences and privileges and qualifications,
limitations and restrictions granted to and imposed on the shares of Preferred
Stock of the corporation shall be as set forth below in this Division A.
Shares of Preferred Stock may be issued in one or more series at such
time or times, and for such consideration or considerations, as the board of
directors shall determine. The board of directors is hereby authorized to fix,
state and establish, in the resolution or resolutions providing for the
issuance of any wholly unissued series of Preferred Stock, the relative
powers, rights, designations, preferences, qualifications, limitations and
restrictions of such series in relation to any other series of Preferred Stock
at the time outstanding. The board of directors is also expressly authorized
to fix the number of shares of each such series, but not below the number of
shares thereof then outstanding. The authority of the board of directors with
respect to each series of Preferred Stock shall include (without limitation)
the determination of the following:
(a) the dividend rate on the shares of such series,
whether dividends shall be cumulative, and, if so, from which date or
dates, and the rights of priority, if any, with respect to the payment of
dividends on the shares of such series relative to other series of
Preferred Stock or classes of stock;
(b) whether the shares of such series shall have voting
rights (other than the voting rights provided by law) and, if so, the terms
and extent of such voting rights;
(c) whether the shares of such series shall have
conversion privileges, and, if so, the terms and conditions of such
conversion, including provision for adjustment of the conversion rate upon
the occurrence of such events as the board of directors may prescribe;
(d) whether the shares of such series shall be subject to
redemption by the corporation or at the request of the holder(s) thereof,
and, if so, the terms and conditions of any such redemption;
(e) the rights of the shares of such series in the event
of voluntary or involuntary liquidation, dissolution or winding up of the
corporation, and the rights of priority, if any, with respect to the
distribution of assets on the shares of such series relative to other
series of Preferred Stock or classes of stock; and
(f) any other preferences, privileges and powers, and
relative, participating, optional or other special rights, and
qualifications, limitations or restrictions 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, as the same may be amended
from time to time.
* * * *
Pursuant to the above stated authority, the board of
directors has designated the following series of Preferred Stock:
SECTION 1. DESIGNATION AND AMOUNT.
The shares of such series shall be designated as "Series A
Junior Participating Preferred Stock" and the number of shares constituting
such series shall be 140,000.
SECTION 2. DIVIDENDS AND DISTRIBUTIONS.
(a) The holders of shares of Series A Junior Participating
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 last day of March, June, September and
December 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 Participating Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (x) $.01 or (y) subject to the provision
for adjustment hereinafter set forth, 1,000 times the aggregate per share
amount of all cash dividends, and 1,000 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 Class A Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Class A Common Stock, since the immediately preceding
Quarterly Dividend Payment Date, or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series A Junior Participating Preferred Stock. In the event the
corporation shall at any time after the date of consummation of the merger of
CME Merger Subsidiary Inc. with and into the Exchange (as defined below) (the
"Rights Declaration Date") (i) declare any dividend on Class A Common Stock
payable in shares of Class A Common Stock, (ii) subdivide the outstanding
Class A Common Stock, or (iii) combine the outstanding Class A Common Stock
into a smaller number of shares, then in each such case the amount to which
holders of shares of Series A Junior Participating Preferred Stock were
entitled immediately prior to such event under clause (y) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Class A Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Class A Common Stock that were outstanding immediately prior to such
event.
(b) The corporation shall declare a dividend or distribution
on the Series A Junior Participating Preferred Stock as provided in Paragraph
(a) above immediately after it declares a dividend or distribution on the
Class A Common Stock (other than a dividend payable in shares of Class A
Common Stock); provided that, in the event no dividend or distribution shall
have been declared on the Class A Common Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend
Payment Date, a dividend of $.01 per share on the Series A Junior
Participating Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Junior Participating Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of issue of such
shares of Series A Junior Participating 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 Participating 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 Participating 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 Participating 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.
SECTION 3. VOTING RIGHTS.
The holders of shares of Series A Junior Participating
Preferred Stock shall have the following voting rights:
(a) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Junior Participating Preferred Stock shall
entitle the holder thereof to 1,000 votes on all matters submitted to a vote
of the shareholders of the corporation. In the event the corporation shall at
any time after the Rights Declaration Date (i) declare any dividend on Class A
Common Stock payable in shares of Class A Common Stock, (ii) subdivide the
outstanding Class A Common Stock, or (iii) combine the outstanding Class A
Common Stock into a smaller number of shares, then in each such case the
number of votes per share to which holders of shares of Series A Junior
Participating Preferred Stock were entitled immediately prior to such event
shall be adjusted by multiplying such number by a fraction the numerator of
which is the number of shares of Class A Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of Class
A Common Stock that were outstanding immediately prior to such event.
(b) Except as otherwise provided herein or by law, the
holders of shares of Series A Junior Participating Preferred Stock and the
holders of shares of Class A Common Stock and Class B Common Stock shall vote
together as one class on all matters submitted to a vote of shareholders of
the corporation.
(c) (i) If at any time dividends on any Series A
Junior Participating Preferred Stock shall be in arrears in an amount
equal to six quarterly dividends thereon, the occurrence of such
contingency shall mark the beginning of a period (herein called a
"default period") which shall extend until such time when all accrued
and unpaid dividends for all previous quarterly dividend periods and
for the current quarterly dividend period on all shares of Series A
Junior Participating Preferred Stock then outstanding shall have been
declared and paid or set apart for payment. During each default
period, all holders of Preferred Stock (including holders of the
Series A Junior Participating Preferred Stock) with dividends in
arrears in an amount equal to six quarterly dividends thereon, voting
as a class, irrespective of series, shall have the right to elect two
directors.
(ii) During any default period, such voting
right of the holders of Series A Junior Participating Preferred Stock
may be exercised initially at a special meeting called pursuant to
Paragraph (c)(iii) of this Section 3 or at any annual meeting of
shareholders, and thereafter at annual meetings of shareholders,
provided that such voting right shall not be exercised unless the
holders of 10% in number of shares of Preferred Stock outstanding
shall be present in person or by proxy. The absence of a quorum of
the holders of Common Stock shall not affect the exercise by the
holders of Preferred Stock of such voting right. At any meeting at
which the holders of Preferred Stock shall exercise such voting right
initially during an existing default period, they shall have the
right, voting as a class, to elect directors to fill such vacancies,
if any, in the board of directors as may then exist up to two
directors or, if such right is exercised at an annual meeting, to
elect two directors. If the number which may be so elected at any
special meeting does not amount to the required number, the holders
of the Preferred Stock shall have the right to make such increase in
the number of directors as shall be necessary to permit the election
by them of the required number. After the holders of the Preferred
Stock shall have exercised their right to elect directors in any
default period and during the continuance of such period, the number
of directors shall not be increased or decreased except by vote of
the holders of Preferred Stock as herein provided or pursuant to the
rights of any equity securities ranking senior to or pari passu with
the Series A Junior Participating Preferred Stock.
(iii) Unless the holders of Preferred Stock
shall, during an existing default period, have previously exercised
their right to elect directors, the board of directors may order, or
any shareholder or shareholders owning in the aggregate not less than
10% of the total number of shares of Preferred Stock outstanding,
irrespective of series, may request, the calling of a special meeting
of the holders of Preferred Stock, which meeting shall thereupon be
called by the Chairman of the Board, the President, any Managing
Director or the Secretary of the corporation. Notice of such meeting
and of any annual meeting at which holders of Preferred Stock are
entitled to vote pursuant to this Paragraph (c)(iii) shall be given
to each holder of record of Preferred Stock by mailing a copy of such
notice to him or her at his or her last address as the same appears
on the books of the corporation. Such meeting shall be called for a
time not earlier than 20 days and not later than 60 days after such
order or request or in default of the calling of such meeting within
60 days after such order or request, such meeting may be called on
similar notice by any shareholder or shareholders owning in the
aggregate not less than 10% of the total number of shares of
Preferred Stock outstanding. Notwithstanding the provisions of this
Paragraph (c)(iii), no such special meeting shall be called during
the period within 60 days immediately preceding the date fixed for
the next annual meeting of the shareholders.
(iv) In any default period, the holders of
Common Stock, and other classes of stock of the corporation if
applicable, shall continue to be entitled to elect the whole number
of directors until the holders of Preferred Stock shall have
exercised their right to elect two directors voting as a class, after
the exercise of which right (x) the directors so elected by the
holders of Preferred Stock shall continue in office until their
successors shall have been elected by such holders or until the
expiration of the default period, and (y) any vacancy in the board of
directors may (except as provided in Paragraph (c)(ii) of this
Section 3) be filled by vote of a majority of the remaining directors
theretofore elected by the holders of the class of stock which
elected the director whose office shall have become vacant.
References in this Paragraph (c) to directors elected by the holders
of a particular class of stock shall include directors elected by
such directors to fill vacancies as provided in clause (y) of the
foregoing sentence.
(v) Immediately upon the expiration of a default
period, (x) the right of the holders of Preferred Stock as a class to
elect directors shall cease, (y) the term of any directors elected by
the holders of Preferred Stock as a class shall terminate, and (z)
the number of directors shall be such number as may be provided for
in the certificate of incorporation or bylaws irrespective of any
increase made pursuant to the provisions of Paragraph (c)(ii) of this
Section 3 (such number being subject, however, to change thereafter
in any manner provided by law or in the certificate of incorporation
or bylaws). Any vacancies in the board of directors effected by the
provisions of clauses (y) and (z) in the preceding sentence may be
filled by a majority of the remaining directors.
(d) Except as set forth herein, holders of Series A Junior
Participating Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to vote
with holders of Common Stock as set forth herein) for taking any corporate
action.
SECTION 4. CERTAIN RESTRICTIONS.
(a) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Junior Participating 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 Participating Preferred Stock outstanding shall have been paid
in full, the corporation shall not:
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Junior Participating Preferred 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 Participating Preferred Stock, except
dividends paid ratably on the Series A Junior Participating Preferred
Stock and all such parity stock 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 Participating 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 (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Junior
Participating Preferred Stock; or
(iv) purchase or otherwise acquire for
consideration any shares of Series A Junior Participating Preferred
Stock, or any shares of stock ranking on a parity with the Series A
Junior Participating 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 corporation 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 Participating 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 resolutions of the board of
directors, subject to the conditions and restrictions on issuance set forth
herein.
SECTION 6. LIQUIDATION, DISSOLUTION OR WINDING UP.
(a) Upon any liquidation (voluntary or otherwise),
dissolution or winding up of the corporation, no distribution shall be made to
the holders of shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior Participating
Preferred Stock unless, prior thereto, the holders of shares of Series A
Junior Participating Preferred Stock shall have received an amount equal to
1,000 times the Exercise Price, plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date of
such payment (the "Series A Liquidation Preference"). Following the payment of
the full amount of the Series A Liquidation Preference, no additional
distributions shall be made to the holders of shares of Series A Junior
Participating Preferred Stock unless, prior thereto, the holders of shares of
Common Stock shall have received an amount per share (the "Common Adjustment")
equal to the quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 1,000 (as appropriately adjusted as set forth in Paragraph
(c) of this Section 6 to reflect such events as stock splits, stock dividends
and recapitalizations with respect to the Common Stock) (such number in clause
(ii), the "Adjustment Number"). Following the payment of the full amount of
the Series A Liquidation Preference and the Common Adjustment in respect of
all outstanding shares of Series A Junior Participating Preferred Stock and
Common Stock, respectively, holders of Series A Junior Participating Preferred
Stock and holders of shares of both classes of Common Stock shall receive
their ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with respect to such
Preferred Stock and Common Stock, on a per share basis, respectively.
(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 Participating
Preferred Stock, then such remaining assets shall be distributed ratably to
the holders of such parity shares in proportion to their respective
liquidation preferences. In the event, however, that there are not sufficient
assets available to permit payment in full of the Common Adjustment, then such
remaining assets shall be distributed ratably to the holders of both classes
of Common Stock.
(c) In the event the corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on Class A Common Stock
payable in shares of Class A Common Stock, (ii) subdivide the outstanding
Class A Common Stock, or (iii) combine the outstanding Class A Common Stock
into a smaller number of shares, then in each such case the Adjustment Number
in effect immediately prior to such event shall be adjusted by multiplying
such Adjustment Number by a fraction the numerator of which is the number of
shares of Class A Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Class A Common Stock that
were outstanding immediately prior to such event.
SECTION 7. CONSOLIDATION, MERGER, ETC.
In case the corporation shall enter into any consolidation,
merger, combination or other transaction in which the shares of Class A 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
Participating 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 1,000 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 Class A 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 Class A Common Stock payable in
shares of Class A Common Stock, (ii) subdivide the outstanding Class A Common
Stock, or (iii) combine the outstanding Class A 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
Participating Preferred Stock shall be adjusted by multiplying such amount by
a fraction the numerator of which is the number of shares of Class A Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Class A Common Stock that were outstanding immediately
prior to such event.
SECTION 8. NO REDEMPTION.
The shares of Series A Junior Participating Preferred Stock
shall not be redeemable.
SECTION 9. AMENDMENT.
The Certificate of Incorporation of the corporation shall
not be further amended in any manner which would materially alter or change
the powers, preferences or special rights of the Series A Junior Participating
Preferred Stock so as to affect them adversely without the affirmative vote of
the holders of a majority or more of the outstanding shares of Series A Junior
Participating Preferred Stock, voting separately as a class.
SECTION 10. FRACTIONAL SHARES.
Series A Junior Participating Preferred Stock may be issued
in fractions of a share which shall entitle the holder, in proportion to such
holders fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Junior Participating Preferred Stock.
* * * *
DIVISION B
COMMON STOCK
SUBDIVISION 1: GENERAL PROVISIONS
The rights, preferences and privileges, and qualifications,
limitations and restrictions granted to and imposed on the classes of Common
Stock shall be as set forth in this Division B.
SECTION 1. DEFINITIONS.
In addition to the terms defined elsewhere, the following
terms shall have the respective meanings set forth below:
"Class B Common Stock" shall mean, collectively, Class B-1
Common Stock, Class B-2 Common Stock, Class B-3 Common Stock and
Class B-4 Common Stock.
"Conversion Transfers" shall mean any of the following:
(1) Transfers to the corporation;
(2) Transfers in a Secondary Sale Process or in an IPO;
(3) Transfers to satisfy Exchange claims or the claims of
other members as permitted or required under Exchange rules; and
(4) Transfers approved as Conversion Transfers by the board
of directors of the corporation.
"Core Rights" shall mean:
(1) the divisional product allocation rules applicable to
each membership class as set forth in the rules of the Exchange;
(2) the trading floor access rights and privileges granted
to members of the Exchange;
(3) the number of authorized and issued shares of any class
of Class B Common Stock; or
(4) the eligibility requirements for any Person to exercise
any of the trading rights or privileges of members in the Exchange.
"Effectiveness Date" shall mean the date of acceptance by
the Delaware Secretary of State of the filing of this Certificate of
Incorporation.
"Exchange" shall mean Chicago Mercantile Exchange Inc., the
subsidiary of the corporation conducting its exchange operations.
"IPO" shall mean an initial public offering of Class A
Common Stock that has been underwritten by one or more nationally
recognized underwriting firms, following which shares of the Class A
Common Stock are listed on a securities exchange such as the New York
Stock Exchange or the Nasdaq National Market.
"IPO Date" shall mean the date on which the corporation
shall have closed an IPO.
"Non-Conversion Transfers" shall mean any of the following:
(1) Transfers of Restricted Class A Shares with a share of
Class B Common Stock; provided that, in order to qualify as a
Non-Conversion Transfer, a share of Class B Common Stock must be
transferred (in accordance with the rules of the Exchange) as a
bundle with the following shares of Class A-1 Common Stock, Class A-2
Common Stock, Class A-3 Common Stock and Class A-4 Common Stock:
Class B-1 Common Stock -- 4,500 shares each of Class A-1 Common
Stock, Class A-2 Common Stock and Class A-3 Common Stock and 4,499
shares of Class A-4 Common Stock; Class B-2 Common Stock -- 3,000
shares each of Class A-1 Common Stock, Class A-2 Common Stock and
Class A-3 Common Stock and 2,999 shares of Class A-4 Common Stock;
Class B-3 Common Stock -- 1,500 shares each of Class A-1 Common
Stock, Class A-2 Common Stock and Class A-3 Common Stock and 1,499
shares of Class A-4 Common Stock; and Class B-4 Common Stock -- 25
shares each of Class A-1 Common Stock, Class A-2 Common Stock and
Class A-3 Common Stock and 24 shares of Class A-4 Common Stock;
provided further, that the Transfer of Class A-1 Common Stock, Class
A-2 Common Stock, Class A-3 Common Stock or Class A-4 Common Stock as
specified above shall not be required to be transferred with a share
of Class B Common Stock, if any such shares are no longer Restricted
Class A Shares;
(2) Transfers of Restricted Class A Shares to:
(A) the transferor's spouse or child, provided that
the transferor was a holder on the Effective Date of the
shares being transferred, or the transferor is a member of
the Exchange;
(B) a trust for the sole benefit of the transferor
or the transferor's spouse or child, provided that the
transferor was a holder on the Effective Date of the shares
being transferred, or the transferor is a member of the
Exchange;
(C) the beneficial owner of an individual
retirement account, provided that the transferor is such
individual retirement account;
(D) the estate of a deceased holder of shares
provided that either (1) the deceased holder was a holder on
the Effective Date of the shares being transferred; or (2)
the deceased holder was a member of the Exchange on the date
of death; and such transfer was pursuant to the deceased
holder's will or the laws of descent and distribution; or
(E) the beneficiary of an estate referred to in
clause (D) above, provided that the transferor is such
estate and such beneficiary is the spouse or child of the
deceased holder or a trust for the sole benefit of such
spouse or child;
(3) Bona fide pledges to a commercial bank, a savings and
loan institution or any other lending or financial institution or any
member or clearing member as security for indebtedness of the holder
incurred to acquire a membership interest in the Exchange;
(4) Pledges as collateral to or assignment for the benefit
of clearing members as permitted or required under Exchange rules;
and
(5) Transfers approved as Non-Conversion Transfers by the
board of directors of the corporation.
"Notice of Secondary Sale Opportunity" shall mean a written
notice given by the corporation, at least 60 days prior to the
expiration of the applicable transfer restriction period, to each
then registered holder of Restricted Class A Shares to the effect
that the corporation intends to guide a secondary sales opportunity,
which may be a secondary offering of shares underwritten by one or
more nationally recognized underwriting firms, a sale of shares to
one or more purchasers in a limited offering or sales process, a
repurchase of shares by the corporation or such other process or
means as the board of directors may determine.
A "Permitted Transfer" means Conversion Transfers and
Non-Conversion Transfers.
"Person" shall mean any individual, corporation,
partnership, trust or other entity.
"Restricted Class A Shares" shall mean all issued and
outstanding shares of Class A-1 Common Stock, Class A-2 Common Stock,
Class A-3 Common Stock and Class A-4 Common Stock prior to the time
any such shares have converted into Unrestricted Class A Shares
pursuant to this Certificate of Incorporation.
"Secondary Sale Process" shall mean a sale process guided by
the corporation pursuant to Paragraphs (a)(ii) or (iii) of Section 1
of Subdivision 3 as provided in the Notice of Secondary Sale
Opportunity.
A "Transfer" (and the related term "Transferred") shall mean
any sale, pledge, gift, assignment or other transfer of any ownership
in any share of Class A-1 Common Stock, Class A-2 Common Stock, Class
A-3 Common Stock, Class A-4 Common Stock or Class B Common Stock.
"Unrestricted Class A Shares" shall mean shares of Class A
Common Stock.
SECTION 2. GENERAL.
Except as otherwise set forth in this Division B, the
relative powers, preferences and participating, optional or other special
rights, and the qualifications, limitations or restrictions of each class of
Common Stock shall be identical in all respects.
SECTION 3. DIVIDENDS.
Subject to the rights of the holders of Preferred Stock,
holders of Common Stock shall be entitled to receive such dividends and other
distributions in cash, stock of any corporation or property of the corporation
as may be declared thereon by the board of directors from time to time out of
assets or funds of the corporation legally available therefore, and shall
share equally on a per share basis in all such dividends and other
distributions.
SECTION 4. VOTING RIGHTS.
Subject to the rights of holders of Class B Common Stock set
forth in this Division B, at every meeting of the shareholders of the
corporation in connection with the election of Equity Directors (as defined
below) and all other matters submitted to a vote of shareholders, every holder
of Common Stock shall be entitled to one vote in person or by proxy for each
share of Common Stock registered in his or her name on the transfer books of
the corporation. Except as otherwise required by law or by this Division B,
the holders of each class of Common Stock shall vote together as a single
class, subject to any right that may be conferred upon holders of Preferred
Stock to vote together with holders of Common Stock on all matters submitted
to a vote of shareholders of the corporation.
SECTION 5. LIQUIDATION RIGHTS.
Upon the liquidation, dissolution or winding up of the
corporation, holders of Common Stock shall be entitled to receive any amounts
available for distribution to holders of Common Stock after the payment of, or
provision for, obligations of the corporation and any preferential amounts
payable to holders of any outstanding shares of Preferred Stock.
SECTION 6. REORGANIZATION, CONSOLIDATION OR MERGER.
In case of any reorganization or any consolidation of the
corporation with one or more other corporations or a merger of the corporation
with another corporation, each holder of a share of Class A Common Stock,
Class A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common Stock and
Class A-4 Common Stock shall be entitled to receive with respect to that share
the same kind and amount of shares of stock and other securities and property
(including cash) receivable upon the reorganization, consolidation or merger
by a holder of a share of any of them.
SUBDIVISION 2: CLASS B COMMON STOCK
The rights, preferences and privileges, and qualifications,
limitations and restrictions granted to and imposed on the shares of Class B
Common Stock of the corporation shall be as set forth in Subdivision 1 and
this Subdivision 2 of this Division B.
SECTION 1. SPECIAL VOTING RIGHTS.
In addition to the voting rights set forth in Subdivision 1
of this Division B, the holders of shares of Class B Common Stock shall,
subject to Paragraph (c) of this Section 1, have the following additional
voting rights:
(a) ELECTION OF CLASS B DIRECTORS. Subject to and in
accordance with Article Five, Holders of shares of Class B-1 Common Stock
shall have the sole right to elect three directors to the corporation's board
of directors (the "Class B-1 Directors"), and each holder of Class B-1 Common
Stock shall have one vote per share in any such election. Holders of shares of
Class B-2 Common Stock shall have the sole right to elect two directors to the
corporation's board of directors (the "Class B-2 Directors"), and each holder
of Class B-2 Common Stock shall have one vote per share in any such election.
Holders of shares of Class B-3 Common Stock shall have the sole right to elect
one director to the corporation's board of directors (the "Class B-3
Director"), and each holder of Class B-3 Common Stock shall have one vote per
share in any such election.
(b) CORE RIGHTS. Any change, amendment or modification of
the Core Rights or of the terms of Section 3 of this Subdivision 2 shall be
submitted to a vote of the holders of the Class B Common Stock for their
consideration and approval. In any such vote, holders of Class B-1 Common
Stock shall be entitled to six votes for each share of Class B-1 Common Stock
held, holders of Class B-2 Common Stock shall be entitled to two votes for
each share of Class B-2 Common Stock held, holders of Class B-3 Common Stock
shall be entitled to one vote for each share of Class B-3 Common Stock held
and holders of Class B-4 Common Stock shall be entitled to one-sixth of one
vote for each share of Class B-4 Common Stock held. Any such change, amendment
or modification must be approved by a majority of the aggregate votes cast by
the holders of the Class B Common Stock present (in person or by proxy) and
voting at the meeting of holders of Class B Common Stock called for the
purpose of voting on the proposed change, amendment or modification; provided
that holders of at least a majority of the aggregate number of votes entitled
to vote on the matter shall be present, in person or by proxy, at such
meeting. The absence of a quorum of the holders of Common Stock shall not
effect the exercise by the holders of Class B Common Stock of the voting
rights granted pursuant to this Paragraph (b).
(c) LIMITATION ON VOTING RIGHTS. Notwithstanding anything to
the contrary contained in this Section 1 of this Subdivision 2, for so long as
any Person or group of Persons acting in concert beneficially own (as defined
below) 15% or more of the outstanding shares of any class of Class B Common
Stock, then in any election of directors elected by that class or other
exercise of voting rights with respect to Core Rights or with respect to the
election or removal of directors elected by that class, such Person or group
shall only be entitled to vote (or otherwise exercise voting rights with
respect to a number of shares of that class of Class B Common Stock that
constitutes a percentage of the total number of shares of that class of Class
B Common Stock then outstanding which is less than or equal to such Person or
group's Entitled Voting Percentage (as defined below). For the purposes
hereof, a Person or group's "Entitled Voting Percentage" at any time shall
mean the percentage of the then outstanding shares of Class A Common Stock,
Class A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common Stock and
Class A-4 Common Stock in the aggregate, beneficially owned by such Person or
group at such time. For purposes of this Paragraph (c), a "beneficial owner"
of Common Stock includes any Person or group of Persons who, directly or
indirectly, including through any contract, arrangement, understanding,
relationship or otherwise, written or oral, formal or informal, control the
voting power (which includes the power to vote or to direct the voting) of
such Common Stock.
SECTION 2. LIMITATION ON OWNERSHIP AND TRANSFER
RESTRICTIONS.
(a) Shares of Class B Common Stock may not be Transferred at
any time except as follows and subject to the following limitations:
(i) No person may own a share of Class B-1 Common
Stock unless that person is recognized on the books and
records of the Exchange as the owner of a Chicago Mercantile
Exchange Division membership ("CME Membership") in the
Exchange as governed by the rules of the Exchange; provided
that each holder shall not be permitted to own more than one
share of Class B-1 Common Stock for each CME Membership;
(ii) No person may own a share of Class B-2 Common
Stock unless that person is recognized on the books and
records of the Exchange as the owner of an International
Monetary Market Division membership ("IMM Membership") in
the Exchange as governed by the rules of the Exchange;
provided that each holder shall not be permitted to own more
than one share of Class B-2 Common Stock for each IMM
Membership;
(iii) No person may own a share of Class B-3 Common
Stock unless that person is recognized on the books and
records of the Exchange as the owner of an Index and Option
Market Division membership ("IOM Membership") in the
Exchange as governed by the rules of the Exchange; provided
that each holder shall not be permitted to own more than one
share of Class B-3 Common Stock for each IOM Membership;
(iv) No person may own a share of Class B-4 Common
Stock unless that person is recognized on the books and
records of the Exchange as an owner of a Growth and Emerging
Markets Division membership ("GEM Membership") as governed
by the rules of the Exchange; provided that each holder
shall not be permitted to own more than one share of Class
B-4 Common Stock for each GEM Membership;
(b) No share of Class B-1 Common Stock may be Transferred
other than in connection with the Transfer of a CME Membership made in
accordance with the rules of the Exchange; provided that no more than one
share of Class B-1 Common Stock may be Transferred with a CME Membership;
(c) No share of Class B-2 Common Stock may be Transferred
other than in connection with the Transfer of an IMM Membership made in
accordance with the rules of the Exchange; provided that no more than one
share of Class B-2 Common Stock may be Transferred with an IMM Membership;
(d) No share of Class B-3 Common Stock may be Transferred
other than in connection with the Transfer of an IOM Membership made in
accordance with the rules of the Exchange; provided that no more than one
share of Class B-3 Common Stock may be Transferred with an IOM Membership;
(e) No share of Class B-4 Common Stock may be Transferred
other than in connection with the Transfer of a GEM Membership made in
accordance with the rules of the Exchange; provided that no more than one
share of Class B-4 Common Stock may be Transferred with a GEM Membership;
(f) Every certificate for shares of Class B-1 Common Stock,
Class B-2 Common Stock, Class B-3 Common Stock and Class B-4 Common Stock
shall bear a legend on its face reading as follows:
"The shares of Common Stock represented by this
certificate may not be Transferred to any person in
connection with a Transfer that does not meet the rules of
Chicago Mercantile Exchange Inc. or the terms of the
Certificate of Incorporation of this corporation until the
transfer restrictions applicable to the shares represented
by this certificate expire, and no person who receives the
shares represented by this certificate in connection with a
Transfer that does not satisfy the rules of Chicago
Mercantile Exchange Inc. or the terms of the Certificate of
Incorporation of this corporation prior to such time is
entitled to own or to be registered as the record holder of
the shares of Common Stock represented by this certificate.
Each holder of this certificate, by accepting the
certificate, accepts and agrees to all of the foregoing."
(g) Except as permitted by this Section 2 of this
Subdivision 2, any proposed Transfer of shares of Class B-1 Common Stock,
Class B-2 Common Stock, Class B-3 Common Stock or Class B-4 Common Stock shall
be void.
SECTION 3. COMMITMENT TO MAINTAIN FLOOR TRADING.
The corporation shall cause the Exchange, (i) as long as an
open outcry market is liquid (as defined below), to maintain for such open
outcry market a facility for conducting business, for the dissemination of
price information, for clearing and delivery and (ii) to provide reasonable
financial support (consistent with the calendar year 1999 budget levels
established by Chicago Mercantile Exchange, an Illinois not-for-profit
corporation, the predecessor of the Exchange) for technology, marketing and
research for open outcry markets. If an open outcry market is not liquid, as
determined by the board of directors, the board may determine, in its sole
discretion, whether such obligations will continue, and for how long, in
respect of such market. For purposes of this Section, an open outcry market
will be deemed "liquid" if it meets any of the following tests on a quarterly
basis:
(a) if a comparable exchange-traded product exists,
including electronic trading at the Exchange, the Exchange's open outcry
market has maintained at least 30% of the average daily volume of such
comparable product (including, for calculation purposes, volume from
exchange-for-physical transactions in such open outcry market); or
(b) if a comparable exchange-traded product exists and the
product trades exclusively by open outcry at the Exchange, the Exchange's open
outcry market has maintained at least 30% of the open interest of such
comparable product; or
(c) if no comparable exchange-traded product exists, the
open outcry market has maintained at least 40% of the average quarterly volume
in that market during 1999 at Chicago Mercantile Exchange, an Illinois
not-for-profit corporation, the predecessor of the Exchange (including, for
calculation purposes, volume from exchange-for-physical transactions in such
open outcry market); or
(d) if no comparable exchange-traded product exists and the
product trades exclusively by open outcry, the open outcry market has
maintained at least 40% of the average open interest in that market during
1999 at Chicago Mercantile Exchange, an Illinois not-for-profit corporation,
the predecessor of the Exchange.
SUBDIVISION 3: CLASS A COMMON STOCK
The rights, preferences and privileges, and qualifications,
limitations and restrictions granted to and imposed on the shares of Class A
Common Stock of the corporation shall be as set forth in Subdivision 1 and
this Subdivision 3 of this Division B.
SECTION 1. TRANSFER RESTRICTIONS; CONVERSION INTO CLASS A
COMMON STOCK.
(a) In the event that an IPO Date is on or prior to December
15, 2002, then, no Restricted Class A Shares may be Transferred other than in
a Permitted Transfer, except as follows:
(i) During the period commencing on the
Effectiveness Date and ending on the date occurring 180 days after
the IPO Date, Restricted Class A Shares may only be Transferred in a
Permitted Transfer.
(ii) On the 181st day after the IPO Date the
restrictions on Transfer applicable to the Class A-1 Common Stock
shall expire and all issued and outstanding Class A-1 Common Stock
shall automatically convert (without any action by the holder) into
Unrestricted Class A Shares; PROVIDED, HOWEVER, if the corporation
shall give, on or before the 120th day after the IPO Date, a Notice
of Secondary Sale Opportunity, then (x) the corporation shall have
until the 240th day after the IPO Date in order to complete the
Secondary Sale Process contemplated in said notice, and (y) the Class
A-1 Common Stock shall not convert into Unrestricted Class A Shares
on such 181st day and such shares may not be Transferred (other than
in a Permitted Transfer); PROVIDED FURTHER, HOWEVER:
(A) if (x) the Secondary Sale Process is
completed on or before the 240th day after the IPO Date and
(y) not less than the lesser of all of the issued and
outstanding shares of Class A-1 Common Stock or the number
of such shares of Class A-1 Common Stock requested to be
included in such sale process are sold, no shares of Class
A-1 Common Stock shall convert into Unrestricted Class A
Shares and such shares may not be Transferred other than in
a Permitted Transfer (other than the shares sold in such
Secondary Sale Process); or
(B) if (x) the Secondary Sale Process is
so completed on or before the 240th day after the IPO Date
and (y) less than the lesser of all of the issued and
outstanding shares of Class A-1 Common Stock or the number
of such shares of Class A-1 Common Stock requested to be
included in such sale process are sold, then on the 241st
day after the IPO Date the shares of Class A-1 Common Stock
requested by holders to be included in the Secondary Sale
Process and not sold in such sale process shall
automatically convert (without any action by the holder)
into Unrestricted Class A Shares. Any shares of Class A-1
Common Stock not requested to be included in such sale
process shall not convert into Unrestricted Class A Shares
and may not be Transferred other than in a Permitted
Transfer; or
(C) if the Secondary Sale Process is not
completed on or before the 240th day after the IPO Date,
then on the 241st day after the IPO Date all issued and
outstanding shares of Class A-1 Common Stock shall
automatically convert into Unrestricted Class A Shares.
(iii) On the 361st day after the IPO Date the
restrictions on Transfer applicable to the Class A-2 Common Stock
shall expire and all issued and outstanding Class A-2 Common Stock
shall automatically convert (without any action by the holder) into
Unrestricted Class A Shares; PROVIDED, HOWEVER, if the corporation
shall give, on or before the 300th day after the IPO Date, a Notice
of Secondary Sale Opportunity, then (x) the corporation shall have
until the 420th day after the IPO Date in order to complete the
Secondary Sale Process contemplated in said notice, and (y) the Class
A-2 Common Stock shall not convert into Unrestricted Class A Shares
on such 361st day and such shares may not be Transferred (other than
in a Permitted Transfers); PROVIDED FURTHER, HOWEVER:
(A) if (x) the Secondary Sale Process is
so completed on or before the 420th day after the IPO Date
and (y) not less than the lesser of all of the issued and
outstanding shares of Class A-2 Common Stock or the number
of such shares of Class A-2 Common Stock requested to be
included in such sale process are sold, no shares of Class
A-1 Common Stock or Class A-2 Common Stock shall convert
into Unrestricted Class A Shares and such shares may not be
Transferred other than in a Permitted Transfer (other than
the shares sold in such Secondary Sale Process); or
(B) if (x) the Secondary Sale Process is
so completed on or before the 420th day after the IPO Date
and (y) less than the lesser of all of the issued and
outstanding shares of Class A-2 Common Stock or the number
of such shares of Class A-2 Common Stock requested to be
included in such sale process are sold, then on the 421st
day after the IPO Date all issued and outstanding shares of
Class A-1 Common Stock and all shares of Class A-2 Common
Stock requested to be included in such sale and not sold in
such sale shall automatically convert (without any action by
the holder) into Unrestricted Class A Shares. Any shares of
Class A-2 Common Stock not requested to be included in such
sale process shall not convert into Unrestricted Class A
Shares and may not be Transferred other than in a Permitted
Transfer; or
(C) if the Secondary Sale Process is not
completed on or before the 420th day after the IPO Date,
then on the 421st day after the IPO Date all issued and
outstanding shares of Class A-1 Common Stock and Class A-2
Common Stock shall automatically convert (without any action
by the holder) into Unrestricted Class A Shares.
(iv) On the 541st day after the IPO Date, all
remaining Restricted Class A Shares shall automatically convert
(without any action by the holder) into Unrestricted Class A Shares.
(v) Following each Notice of Secondary Sale
Opportunity, each holder of Restricted Class A Shares may elect to
include any or all of such holder's Restricted Class A Shares in the
Secondary Sales Process contemplated by such notice by providing
written notice of such election (a "Shareholder Election Notice"),
including the number and class of shares elected to be included in
such sale, to the secretary of the corporation within 20 days after
the receipt of the Notice of Secondary Sale Opportunity. In the event
that a Shareholder Election Notice is not received from a holder
prior to such twentieth day, then such holder shall be deemed to have
elected not to include any of such holder's shares in such Secondary
Sale Process. Any Notice of Secondary Sale Opportunity shall be
deemed to have been received by a holder three business days after
deposited into the United States mail, if sent first class mail and
addressed to the holder at such holder's address as it appears on the
books and records of the corporation. Any Shareholder Election Notice
shall be deemed received by the corporation when actually received by
the secretary of the corporation at the principal place of business
of the corporation in Chicago, Illinois or as otherwise provided in a
notice by the corporation to holders of Restricted Class A Shares.
Each shareholder shall be responsible for insuring that such holder's
notice has been received by the corporation within the 20-day time
period specified above. In the event that holders request to include
more shares in the Secondary Sale Process than the board of directors
determines in its sole discretion should be included in such sale,
the board of directors shall develop, in its sole discretion, a
mechanism for determining the Restricted Class A Shares that may be
included in such sale; provided that preference shall be given to the
class of Class A Common Stock that is scheduled to convert into
Unrestricted Class A Shares in connection with the Secondary Sale
Process. Each Shareholder Election Notice shall be irrevocable. Each
holder's right to participate in a Secondary Sale Process is
conditioned on such holder executing such agreements, including
without limitation, underwriting agreements, placement agreements,
agency agreements, custody agreements and powers of attorney, and
providing such information as are required to complete the Secondary
Sale Process. In the event that a holder fails to deliver such
agreements and provide such information by the deadline specified in
the Notice of Secondary Sale Opportunity, such holder shall be deemed
to have elected not to participate in the Secondary Sale Process. The
corporation shall not be responsible for the fees and expenses of any
holder, including without limitation, broker commissions, agency fees
and underwriting discounts and commissions which shall be the sole
responsibility of each holder participating in the Secondary Sale
Process. Nothing contained in this Subdivision 3 shall require the
corporation to complete any Secondary Sales Process described in a
Notice of Secondary Sale Opportunity, it being understood that the
decision at any time to proceed shall be made in the sole discretion
of the board of directors and that the board of directors may abandon
any such Secondary Sales Process at any time.
(b) If, and only if, the IPO Date is not on or prior to
December 15, 2002, then the provisions of Paragraph (a) shall cease to apply
and shares of Class A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common
Stock and Class A-4 Common Stock may not be Transferred (other than in a
Permitted Transfer) until such shares convert into Unrestricted Class A Shares
on the following dates:
Date of Conversion
Class into Unrestricted Class A Shares
Class A-1 Common Stock December 16, 2002
Class A-2 Common Stock March 16, 2003
Class A-3 Common Stock June 16, 2003
Class A-4 Common Stock September 16, 2003
(c) CONVERSION OF RESTRICTED CLASS A SHARES. Each share of
Class A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common Stock and
Class A-4 Common Stock shall automatically convert (without any action by the
holder) into one Unrestricted Class A Share upon a Conversion Transfer or when
the transfer restrictions applicable to such share shall expire and such share
converts into an Unrestricted Class A Share as described in this Subdivision
3. Unrestricted Shares are not subject to restrictions on Transfer. Restricted
Class A Shares shall not convert into Unrestricted Class A Shares upon a
Non-Conversion Transfer.
(d) Any Person who takes shares of Class A-1 Common Stock,
Class A-2 Common Stock, Class A-3 Common Stock or Class A-4 Common Stock in a
Transfer that complies with the provisions of this Section 1 may treat the
endorsement on the certificate representing such shares, or the instrument of
Transfer accompanying such shares, or the written instrument specified in the
bylaws of the corporation with respect to uncertificated shares, as
authorizing such Person on behalf of the transferor to convert the shares for
the purpose of registering the Transfer to such Person of the shares of Class
A Common Stock issuable upon conversion, and may convert such shares of Class
A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common Stock and Class A-4
Common Stock accordingly.
(e) Every certificate for shares of Class A-1 Common Stock,
Class A-2 Common Stock, Class A-3 Common Stock and Class A-4 Common Stock
shall bear a legend on its face reading as follows:
"The shares of Common Stock represented by this
certificate may not be Transferred to any person in
connection with a Transfer that does not meet the
qualifications set forth in the definition of "Permitted
Transfers" of the Certificate of Incorporation of this
corporation until the transfer restrictions applicable to
the shares represented by this certificate expire, and no
person who receives the shares represented by this
certificate in connection with a Transfer that does not meet
the qualifications prescribed by the definition of
"Permitted Transfers" of the Certificate of Incorporation of
this corporation prior to such time is entitled to own or to
be registered as the record holder of the shares of Common
Stock represented by this certificate. Each holder of this
certificate, by accepting the certificate, accepts and
agrees to all of the foregoing."
(f) Upon any conversion of shares of Class A-1 Common Stock,
Class A-2 Common Stock, Class A-3 Common Stock and Class A-4 Common Stock into
shares of Unrestricted Class A Shares, any dividend, for which the record date
or payment date is subsequent to the conversion, that has been declared on the
shares of Class A-1 Common Stock, Class A-2 Common Stock, Class A-3 Common
Stock or Class A-4 Common Stock so converted shall be deemed to have been
declared, and shall be payable, with respect to the Unrestricted Class A
Shares into or for which the shares of Class A-1 Common Stock, Class A-2
Common Stock, Class A-3 Common Stock or Class A-4 Common Stock are so
converted, and any such dividend that is declared on the shares of Class A-1
Common Stock, Class A-2 Common Stock, Class A-3 Common Stock and Class A-4
Common Stock payable in shares of Class A-1 Common Stock, Class A-2 Common
Stock, Class A-3 Common Stock and Class A-4 Common Stock shall be deemed to
have been declared, and shall be payable, in Unrestricted Class A Shares.
(g) Any shares of Class A-1 Common Stock, Class A-2 Common
Stock, Class A-3 Common Stock or Class A-4 Common Stock that have been
converted into Unrestricted Class A Shares will be retired with no further
action by the corporation, and will become authorized and unissued shares of
Class A Common Stock.
(h) The corporation at all times shall reserve and keep
available, out of its authorized but unissued Class A Common Stock, at least
the number of shares of Class A Common Stock that would become issuable upon
the conversion of all shares of Class A-1 Common Stock, Class A-2 Common
Stock, Class A-3 Common Stock and Class A-4 Common Stock then outstanding.
(i) In connection with any Transfer or conversion of any
shares of any class of Common Stock pursuant to or as permitted by the
provisions of this Section 1, or in connection with the making of any
determination referred to in this Section 1, neither the corporation nor any
director, officer, employee or agent of the corporation shall be liable in any
manner for any action taken or omitted in good faith.
(j) Except as permitted by this Section 1 of this
Subdivision 3, any proposed Transfer of shares of Class A-1 Common Stock,
Class A-2 Common Stock, Class A-3 Common Stock or Class A-4 Common Stock shall
be void.
ARTICLE FIVE:
(A) The initial board of directors of the corporation shall
consist of 29 members, including 26 Equity Directors, one Class B-1
Director, one Class B-2 Director and one Class B-3 Director. The
terms of 20 Equity Directors shall expire at the annual meeting of
shareholders to be held in April 2002 (the "April 2002 Annual
Meeting"). The terms of the remaining six Equity Directors, one Class
B-1 Director, one Class B-2 Director and one Class B-3 Director shall
expire at the annual meeting of shareholders to be held in April
2003.
(B) At the April 2002 Annual Meeting, the size of the board
of directors of the corporation shall be reduced to 19 members by
eliminating 10 Equity Director memberships. At the 2002 Annual
Meeting, 10 directors shall be elected to serve two-year terms as
follows:
(i) Seven directors shall be elected as Equity
Directors;
(ii) Two directors shall be elected as Class B-1
Directors; and
(iii) One director shall be elected as a Class B-2
Director.
Of the nine directors whose terms expire at the annual
meeting of shareholders to be held in April 2003:
(i) Six directors shall be elected as Equity
Directors;
(ii) One director shall be elected as a Class B-1
Director;
(iii) One director shall be elected as a Class B-2
Director; and
(iv) One director shall be elected as a Class B-3
Director.
(C) At each succeeding annual meeting of shareholders, the
successors of the Class B-1 Directors, the Class B-2 Directors, any
Class B-3 Director and the Equity Directors whose terms expire at
that meeting shall be elected by the holders of the Class B-1 Common
Stock, the Class B-2 Common Stock, the Class B-3 Common Stock, and
the Common Stock voting as a single class, respectively. The
directors so elected shall be elected for a term expiring at the
annual meeting of shareholders held in the second year following the
year of their election, and until their successors are duly elected
and qualified and have accepted office, subject to death, resignation
or removal from office. Any vacancy occurring in a directorship may
be filled by the board of directors; PROVIDED, HOWEVER, that any
vacancy occurring with respect to a Class B-1 Director, a Class B-2
Director or a Class B-3 Director shall be filled from the candidates
who lost for such position from the most recent election, with the
candidates being selected to fill such vacancy in the order of the
aggregate number of votes received in such previous election. Any
persons so elected shall serve for the remaining term of his or her
predecessor in office.
(D) No person shall be eligible for election as a Class B-1
Director, a Class B-2 Director or a Class B-3 Director unless he or
she shall own, or be recognized as the owner for the purposes of the
Exchange of, at least one share of the class of Class B Common Stock
entitled to elect such director.
(E) Any director may be removed from office at any time, but
only for cause and only by the affirmative vote of the holders of at
least two-thirds of the voting power of the shares entitled to elect
such person as a director.
(F) The Equity Directors shall include two non-voting
members until the April 2002 Annual Meeting at which time such
directorships will be eliminated.
ARTICLE SIX: The board of directors is hereby authorized to create
and issue, whether or not in connection with the issuance and sale of any of
its stock or other securities or property, rights entitling the holders
thereof to purchase from the corporation shares of Preferred Stock, Class A
Common Stock or securities of any other corporation. The times at which and
the terms upon which such rights are to be issued will be determined by the
board of directors and set forth in the contracts or instruments that evidence
such rights. The authority of the board of directors with respect to such
rights shall include, without limitation, determination of the following:
(A) The initial purchase price per share or other unit of
the stock or other securities or property to be purchased upon
exercise of such rights;
(B) Provisions relating to the times at which and the
circumstances under which such rights may be exercised or sold or
otherwise transferred, either together with or separately from, any
other stock or other securities of the corporation;
(C) Provisions which adjust the number or exercise price of
such rights or amount or nature of the stock or other securities or
property receivable upon exercise of such rights in the event of a
combination, split or recapitalization of any stock of the
corporation, a change in ownership of the corporation's stock or
other securities or a reorganization, merger, consolidation, sale of
assets or other occurrence relating to the corporation or any stock
of the corporation, and provisions restricting the ability of the
corporation to enter into any such transaction absent an assumption
by the other party or parties thereto of the obligations of the
corporation under such rights;
(D) Provisions which deny the holder of a specified
percentage of the outstanding stock or other securities of the
corporation the right to exercise such rights and/or cause the rights
held by such holder to become void;
(E) Provisions which permit the corporation to redeem or to
exchange such rights; and
(F) The appointment of a rights agent with respect to such
rights.
ARTICLE SEVEN:
(A) In furtherance of and not in limitation of the powers
conferred by law, the board of directors is expressly authorized and
empowered to adopt, amend or repeal the bylaws of the corporation;
PROVIDED, HOWEVER, that the bylaws may also be altered, amended or
repealed by the affirmative vote of the holders of two-thirds of the
voting power of the then outstanding Common Stock, voting together as
a single class.
(B) Unless and except to the extent that the bylaws of the
corporation shall so require, the election of directors of the
corporation need not be by written ballot.
ARTICLE EIGHT: No shareholder shall have any preemptive right to
subscribe to an additional issue of any class or series of the corporation's
capital stock or to any securities of the corporation convertible into such
stock.
ARTICLE NINE: Notwithstanding anything contained in this Certificate
of Incorporation to the contrary, the affirmative vote of at least two-thirds
of the voting power of the then outstanding Common Stock, voting together as a
single class, shall be required to amend, repeal or adopt any provisions
inconsistent with Paragraph (E) of Article Five or Articles Six, Nine, Ten,
Eleven, Twelve, Thirteen or Fourteen of this Certificate of Incorporation.
ARTICLE TEN: No director of the corporation shall be personally
liable to the corporation or its shareholders for monetary damages for breach
of fiduciary duty as a director, except for liability (i) for any breach of
the director's duty of loyalty to the corporation or its shareholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL,
or (iv) for any transaction from which the director derived an improper
personal benefit. Any amendment or repeal of this Article by the shareholders
shall not adversely affect any right or protection of a director of the
corporation existing hereunder in respect of any act or omission occurring
prior to such amendment or repeal.
ARTICLE ELEVEN: The corporation shall indemnify its directors and
officers to the fullest extent authorized or permitted by law, as now or
hereafter in effect, and such right to indemnification shall continue as to a
person who has ceased to be a director or officer of the corporation and shall
inure to the benefit of his or her heirs, executors and personal and legal
representatives; PROVIDED, HOWEVER, that, except for proceedings to enforce
rights to indemnification, the corporation shall not be obligated to indemnify
any director or officer (or his or her heirs, executors or personal or legal
representatives) in connection with a proceeding (or part thereof) initiated
by such person unless such proceeding (or part thereof) was authorized or
consented to by the board of directors. The right to indemnification conferred
by this Article Eleven shall include the right to be paid by the corporation
the expenses incurred in defending or otherwise participating in any
proceeding in advance of its final disposition.
The corporation may, to the extent authorized from time to time by
the board of directors, provide rights to indemnification and to the
advancement of expenses to employees and agents of the corporation similar to
those conferred in this Article Eleven to directors and officers of the
corporation.
The rights to indemnification and to the advance of expenses
conferred in this Article Eleven shall not be exclusive of any other right
which any person may have or hereafter acquire under this Certificate of
Incorporation, the bylaws of the corporation, any statute, agreement, vote of
shareholders or disinterested directors or otherwise.
Any repeal or modification of this Article Eleven by the shareholders
of the corporation shall not adversely affect any rights to indemnification
and to the advancement of expenses of a director or officer of the corporation
existing at the time of such repeal or modification with respect to any acts
or omissions occurring prior to such repeal or modification.
ARTICLE TWELVE: In furtherance and not in limitation of the powers
conferred by law or in this Certificate of Incorporation, the board of
directors (and any committee of the board of directors) is expressly
authorized, to the extent permitted by law, to take such action or actions as
the board of directors or such committee may determine to be reasonably
necessary or desirable to (A) encourage any person to enter into negotiations
with the board of directors and management of the corporation with respect to
any transaction which may result in a change in control of the corporation
which is proposed or initiated by such Person or (B) contest or oppose any
such transaction which the board of directors or such committee determines to
be unfair, abusive or otherwise undesirable with respect to the corporation
and its business, assets or properties or the shareholders of the corporation,
including, without limitation, the adoption of such plans or the issuance of
such rights, options, capital stock, notes, debentures or other evidences of
indebtedness or other securities of the corporation, which rights, options,
capital stock, notes, debentures or other evidences of indebtedness and other
securities (i) may be exchangeable for or convertible into cash or other
securities on such terms and conditions as may be determined by the board of
directors or such committee and (ii) may provide for the treatment of any
holder or class of holders thereof designated by the board of directors or any
such committee in respect of the terms, conditions, provisions and rights of
such securities which is different from, and unequal to, the terms,
conditions, provisions and rights applicable to all other holders thereof.
ARTICLE THIRTEEN: No action required to, or which may, be taken at an
annual or special meeting of shareholders of the corporation may be taken
without a meeting, and the power of the shareholders of the corporation to act
by written consent, whether pursuant to Section 228 of the DGCL or otherwise,
is specifically denied.
ARTICLE FOURTEEN: Special meetings of the shareholders, for any
purpose or purposes, unless otherwise prescribed by statute or by this
Certificate of Incorporation, may be called by the Chairman of the Board, in
his discretion, and shall be called by the Chairman of the Board or the
Secretary at the request in writing of a majority of the directors then
holding office. Any such written request shall state the purpose or purposes
of the proposed meeting.
IN WITNESS WHEREOF, the Corporation has caused this Amended and
Restated Certificate of Incorporation to be executed on its behalf as of the
3rd day of December, 2001.
CHICAGO MERCANTILE EXCHANGE
HOLDINGS INC.
By: /s/ C.S. Donohue
-----------------------------------
Name: Craig S. Donohue
Title: Managing Director and Chief
Administrative Officer