RESTATED ARTICLES OF INCORPORATION
OF
PG&E CORPORATION
ROBERT D. GLYNN, JR. and LESLIE H. EVERETT certify that:
1. They are the Chairman of the Board, Chief Executive Officer,
and President, and the Vice President and Corporate Secretary,
respectively, of PG&E Corporation, a California corporation.
2. The Articles of Incorporation of the corporation, as amended
to the date of the filing of this certificate, including the
amendments set forth herein but not separately filed (and with the
omissions required by Section 910 of the California Corporations Code)
are amended and restated as follows:
FIRST: The name of the Corporation shall be
PG&E CORPORATION
SECOND: The purpose of the Corporation is to engage in any
lawful act or activity for which a corporation may be organized under
the General Corporation Law of California other than the banking
business, the trust company business or the practice of a profession
permitted to be incorporated by the California Corporations Code.
THIRD:
I. The Board of Directors of the Corporation shall consist
of such number of directors, not less than seven (7) nor more than
thirteen (13), as shall be prescribed in the Bylaws.
II. The Board of Directors by a vote of two-thirds of the
whole Board may appoint from the directors an Executive Committee,
which Committee may exercise such powers as may lawfully be conferred
upon it by the Bylaws of the Corporation. Such Committee may
prescribe rules for its own government and its meetings may be held at
such places within or without California as said Committee may
determine or authorize.
FOURTH: No shareholder may cumulate votes in the election
of directors. This Article FOURTH shall become effective only when
the Corporation shall have become a "listed corporation" within the
meaning of Section 301.5 of the California Corporations Code.
FIFTH: The liability of the directors of the Corporation
for monetary damages shall be eliminated to the fullest extent
permissible under California law.
SIXTH: The Corporation is authorized to provide
indemnification of agents (as defined in Section 317 of the California
Corporations Code) through bylaws, resolutions, agreements with
agents, vote of shareholders or disinterested directors, or otherwise,
in excess of the indemnification otherwise permitted by Section 317 of
the California Corporations Code, subject only to the applicable
limits set forth in Section 204 of the California Corporations Code.
SEVENTH:
I. The Corporation is authorized to issue two classes of
shares, to be designated respectively Preferred Stock ("Preferred
Stock") and Common Stock ("Common Stock"). The total number of shares
of capital stock that the Corporation is authorized to issue is
885,000,000, of which 85,000,000 shall be Preferred Stock and
800,000,000 shall be Common Stock.
II. The Preferred Stock may be issued from time to time in
one or more series. The Board of Directors of the Corporation is
expressly authorized to provide for the issue of all or any of the
shares of the Preferred Stock in one or more series, and to fix the
designation and number of shares and to determine or alter for each
such series, such voting powers, full or limited, or no voting powers,
and such designations, preferences and relative, participating,
optional or other rights and such qualifications, limitations or
restrictions thereof, as shall be stated and expressed in the
resolution or resolutions adopted by the Board of Directors providing
for the issue of such shares and as may be permitted by the General
Corporation Law of California. The Board of Directors is also
expressly authorized to increase or decrease (but not below the number
of shares of such series then outstanding) the number of shares of any
series subsequent to the issue of shares of that series. If the
number of shares of any such series shall be so decreased, the shares
constituting such decrease shall resume the status that they had prior
to the adoption of the resolution originally fixing the number of
shares of such series.
EIGHTH:
I. The affirmative vote of the holders of not less than a
majority of the outstanding shares of "Voting Stock" (as hereinafter
defined) shall be required to implement or effect any "Business
Combination" (as hereinafter defined) involving the Corporation or any
"Subsidiary" (as hereinafter defined) of the Corporation and any
"Related Person" (as hereinafter defined), or any "Affiliate" or
"Associate" (as hereinafter defined) of a Related Person,
notwithstanding the fact that no vote may be required or that a lesser
percentage may be specified by law, in any agreement with any national
securities exchange or otherwise. In addition, the provisions of
either subparagraph (1) or (2) must be satisfied:
(1) The Business Combination shall have been approved by the
Board of Directors without counting the vote of any director who is
not a "Disinterested Director" (as hereinafter defined); or
(2) All of the following conditions are met:
(i) The cash or "Fair Market Value" (as hereinafter
defined) as of the date of the consummation of the Business
Combination (the "Combination Date") of the property, securities or
other consideration to be received per share by holders of a
particular class or series of capital stock, as the case may be, of
the Corporation in the Business Combination is not less than the
highest of:
(a) the highest per share price (including
brokerage commissions, transfer taxes and soliciting dealers' fees)
paid by or on behalf of the Related Person in acquiring beneficial
ownership of any of its holdings of such class or series of capital
stock of the Corporation (A) within the two-year period immediately
prior to the first public announcement of the proposed Business
Combination (the "Announcement Date") or (B) in the transaction or
series of transactions in which the Related Person became a Related
Person, whichever is higher; or
(b) the highest Fair Market Value per share of the
shares of capital stock being acquired in the Business Combination as
of any date within the one-year period preceding: (A) the Announcement
Date or (B) the date on which the Related Person became a Related
Person, whichever is higher; or
(c) in the case of Common Stock, the highest per
share book value of the Common Stock as reported at the end of the
three fiscal quarters which preceded the Announcement Date, and in the
case of Preferred Stock the highest preferential amount per share to
which the holders of shares of such class or series of Preferred Stock
would be entitled as of the Combination Date in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the
affairs of the Corporation, regardless of whether the Business
Combination to be consummated constitutes such an event.
The provisions of this paragraph I(2)(i) shall be
required to be met with respect to every class or series of
outstanding capital stock, whether or not the Related Person has
previously acquired any shares of a particular class or series of
capital stock. In all of the above instances, appropriate adjustments
shall be made for recapitalizations and for stock dividends, stock
splits and like distributions; and
(ii) The consideration to be received by holders of a
particular class or series of capital stock shall be in cash or in the
same form as previously has been paid by or on behalf of the Related
Person in connection with its direct or indirect acquisition of
beneficial ownership of shares of such class or series of stock. If
the consideration so paid for any such shares varied as to form, the
form of consideration for such shares shall be either cash or the form
used to acquire beneficial ownership of the largest number of shares
of such class or series of capital stock previously acquired by the
Related Person; and
(iii) After such Related Person has become a Related
Person and prior to the consummation of such Business Combination: (a)
except as approved by the Board of Directors without counting the vote
of any director who is not a Disinterested Director, there shall have
been no failure to declare and pay at the regular date therefor any
full quarterly dividends (whether or not cumulative) on the
outstanding Preferred Stock; (b) there shall have been (A) no
reduction in the annual rate of dividends paid on the Common Stock
(except as necessary to reflect any subdivision of the Common Stock)
except as approved by the Board of Directors without counting the vote
of any director who is not a Disinterested Director, and (B) an
increase in such annual rate of dividends as necessary to reflect any
reclassification (including any reverse stock split),
recapitalization, reorganization or any similar transaction which has
the effect of reducing the number of outstanding shares of the Common
Stock, unless the failure so to increase such annual rate is approved
by the Board of Directors without counting the vote of any director
who is not a Disinterested Director; and (c) such Related Person shall
not have become the beneficial owner of any additional shares of
Voting Stock except as part of the transaction which results in such
Related Person becoming a Related Person; and
(iv) After such Related Person has become a Related
Person, the Related Person shall not have received the benefit,
directly or indirectly (except proportionately as a shareholder), of
any loans, advances, guarantees, pledges or other financial assistance
or any tax credits or other tax advantages provided by the
Corporation, whether in anticipation of or in connection with such
Business Combination or otherwise; and
(v) A proxy or information statement describing the
proposed Business Combination and complying with the requirements of
the Securities Exchange Act of 1934 and the rules and regulations
thereunder (or any provisions subsequently replacing such Act, rules
or regulations) shall be mailed to public shareholders of the
Corporation at least 30 days prior to the consummation of such
Business Combination (whether or not such proxy or information
statement is required to be mailed pursuant to such Act or subsequent
provisions).
II. For purpose of this Article EIGHTH:
(1) The term "Business Combination" shall mean any (i)
merger or consolidation of the Corporation or a Subsidiary with a
Related Person or any other person which is or after such merger or
consolidation would be an Affiliate or Associate of a Related Person;
(ii) sale, lease, exchange, mortgage, pledge, transfer or other
disposition or guarantee (in one transaction or a series of
transactions) to or with or for the benefit of any Related Person or
any Affiliate or Associate of any Related Person, of any assets of the
Corporation or of a Subsidiary having an aggregate Fair Market Value
of $100 million or more; (iii) sale, lease, exchange, mortgage,
pledge, transfer or other disposition (in one transaction or a series
of transactions), to the Corporation or a Subsidiary of any assets of
a Related Person or any Affiliate or Associate of any Related Person
having an aggregate Fair Market Value of $100 million or more; (iv)
issuance, pledge or transfer of securities of the Corporation or a
Subsidiary (in one transaction or a series of transactions) to or with
a Related Person or any Affiliate or Associate of any Related Person
in exchange for cash, securities or other property (or a combination
thereof) having an aggregate Fair Market Value of $100 million or
more; (v) reclassification of securities (including any reverse stock
split) or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries or any
other transaction that would have the effect, either directly or
indirectly, of increasing the voting power or the proportionate share
of any class of equity or convertible securities of the Corporation or
any Subsidiary which is directly or indirectly beneficially owned by
any Related Person or any Affiliate or Associate of any Related
Person; and (vi) any merger or consolidation of the Corporation with
any of its Subsidiaries after which the provisions of this Article
EIGHTH of the Articles of Incorporation shall not be contained in the
Articles of Incorporation of the surviving entity.
(2) The term "person" shall mean any individual, firm,
corporation or other entity and shall include any group comprised of
any person and any other person with whom such person or any Affiliate
or Associate of such person has any agreement, arrangement or
understanding, directly or indirectly, for the purpose of acquiring,
holding, voting or disposing of Voting Stock of the Corporation.
(3) The term "Related Person" shall mean any person (other
than the Corporation, or any Subsidiary and other than any dividend
reinvestment plan or profit-sharing, employee stock ownership or other
employee benefit or savings plan of the Corporation or any Subsidiary
or any trustee of or fiduciary with respect to any such plan when
acting in such capacity) who or which:
(i) is the beneficial owner (as hereinafter defined) of
five percent (5%) or more of the Voting Stock;
(ii) is an Affiliate or Associate of the Corporation
and at any time within the two-year period immediately prior to the
date in question was the beneficial owner of five percent (5%) or more
of the then outstanding Voting Stock; or
(iii) is an assignee of or has otherwise succeeded to
the beneficial ownership of any shares of Voting Stock which were at
any time within the two-year period immediately prior to such time
beneficially owned by any Related Person, if such assignment or
succession shall have occurred in the course of a transaction or
series of transactions not involving a public offering within the
meaning of the Securities Act of 1933.
(4) A person shall be a "beneficial owner" of any Voting
Stock:
(i) which such person or any of its Affiliates or
Associates beneficially owns, directly or indirectly;
(ii) which such person or any of its Affiliates or
Associates has, directly or indirectly, (a) the right to acquire
(whether such right is exercisable immediately or only after the
passage of time), pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange
rights, warrants or options, or otherwise, or (b) the right to vote
pursuant to any agreement, arrangement or understanding; or
(iii) which is beneficially owned, directly or
indirectly, by any other person with which such person or any of its
Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of any shares of Voting Stock.
(5) For the purposes of determining whether a person is a
Related Person pursuant to subparagraph (3) of this paragraph II, the
number of shares of Voting Stock deemed to be outstanding shall
include shares deemed owned through application of subparagraph (4) of
this paragraph II but shall not include any other shares of Voting
Stock which may be issuable pursuant to any agreement, arrangement or
understanding, or upon exercise of conversion rights, warrants or
options, or otherwise.
(6) The term "Affiliate," used to indicate a relationship
with a specified person, shall mean a person that directly, or
indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, such specified person.
The term "Associate," used to indicate a relationship with a specified
person, shall mean (i) any person (other than the Corporation or a
Subsidiary) of which such specified person is an officer or partner or
is, directly or indirectly, the beneficial owner of 10% or more of any
class of equity securities, (ii) any trust or other estate in which
such specified person has a substantial beneficial interest or as to
which such specified person serves as trustee or in a similar
fiduciary capacity, (iii) any relative or spouse of such specified
person or any relative of such spouse, who has the same home as such
specified person or who is a director or officer of the Corporation or
any Subsidiary, and (iv) any person who is a director or officer of
such specified person or any of its parents or subsidiaries (other
than the Corporation or a Subsidiary).
(7) The term "Subsidiary" means any corporation or other
entity of which a majority of any class of equity securities is owned,
directly or indirectly, by the Corporation; provided, however, that
for the purposes of the definition of Related Person set forth in
subparagraph (3) of this paragraph II, the term "Subsidiary" shall
mean only a corporation of which a majority of the outstanding shares
of capital stock of such corporation entitled to vote generally in the
election of directors is owned, directly or indirectly, by the
Corporation or, in the case of other entities, the Corporation has the
direct or indirect contractual power to designate a majority of the
individuals or representatives exercising functions similar to those
exercised by directors of a corporation, or the Corporation has the
power to approve a transaction which would otherwise be a Business
Combination involving such entity.
(8) The term "Disinterested Director" means any member of
the Board of Directors, while such person is a member of the Board of
Directors, who is not an Affiliate, Associate or a representative of
the Related Person involved in a proposed Business Combination and was
a member of the Board of Directors immediately prior to the time that
the Related Person became a Related Person, and any successor of a
Disinterested Director, while such successor is a member of the Board
of Directors, who is not an Affiliate, Associate or a representative
of the Related Person and is recommended or elected to succeed a
Disinterested Director by the Board of Directors without counting the
vote of any director who is not a Disinterested Director.
(9) For the purposes of paragraph I(2)(i) of this Article
EIGHTH, the term "other consideration to be received" shall include,
without limitation, capital stock retained by the shareholders.
(10) The term "Voting Stock" shall mean all of the
outstanding shares of capital stock of the Corporation entitled to
vote generally in the election of directors, and each reference to a
proportion of shares of Voting Stock shall refer to such proportion of
the votes entitled to be cast by such shares voting together as one
class.
(11) The term "Fair Market Value" means: (i) in case of
capital stock, the highest closing sale price during the 30-day period
immediately preceding the date in question of a share of such stock on
the Composite Tape for the New York Stock Exchange Listed Stocks, or,
if such stock is not quoted on the Composite Tape, on the New York
Stock Exchange, or if such stock is not listed on such Exchange, on
the principal United States securities exchange registered under the
Securities Exchange Act of 1934 on which such stock is listed, or, if
such stock is not listed on any such stock exchange, the highest
closing bid quotation with respect to a share of such stock during the
30-day period preceding the date in question on the National
Association of Securities Dealers, Inc. Automated Quotations System or
any successor system then in use, or if no such quotations are
available, the fair market value on the date in question of a share of
such stock as determined in good faith by the Board of Directors
without counting the vote of any director who is not a Disinterested
Director; and (ii) in the case of property other than cash or stock,
the fair market value of such property on the date in question as
determined in good faith by the Board of Directors without counting
the vote of any director who is not a Disinterested Director.
(12) A Related Person shall be deemed to have acquired a
share of Voting Stock at the time when such Related Person became the
beneficial owner thereof. If the Board of Directors without counting
the vote of any director who is not a Disinterested Director is not
able to determine the price at which a Related Person has acquired a
share of Voting Stock, such price shall be deemed to be the Fair
Market Value of the shares in question at the time when the Related
Person becomes the beneficial owner thereof. With respect to shares
owned by Affiliates or other persons whose ownership is attributed to
a Related Person under the foregoing definition of Related Person, the
price deemed to be paid therefor by such Related Person shall be the
price paid upon the acquisition thereof by such Affiliate, Associate
or other person, or, if such price is not determinable by the Board of
Directors without counting the vote of any director who is not a
Disinterested Director, the Fair Market Value of the shares in
question at the time when the Affiliate, Associate, or other such
person became the beneficial owner thereof.
III. The fact that any Business Combination complies with
the provisions of paragraph I(2) of this Article EIGHTH shall not be
construed to impose any fiduciary duty, obligation or responsibility
on the Board of Directors, or any member thereof, to approve such
Business Combination or recommend its adoption or approval to the
shareholders of the Corporation, nor shall such compliance limit,
prohibit or otherwise restrict in any manner the Board of Directors,
or any member thereof, with respect to evaluations of or actions and
responses taken with respect to such Business Combination.
IV. The Board of Directors of the Corporation shall have
the power and duty to determine for the purposes of this Article
EIGHTH, on the basis of information known to them after reasonable
inquiry and in accordance with the terms of this Article EIGHTH,
whether a person is a Related Person and whether a director is a
Disinterested Director. Once the Board of Directors has made a
determination pursuant to the preceding sentence that a person is a
Related Person, the Board of Directors of the Corporation, without
counting the vote of any director who is not a Disinterested Director
with respect to such Related Person, shall have the power and duty to
interpret all of the terms and provisions of this Article EIGHTH and
to determine on the basis of the information known to them after
reasonable inquiry all facts necessary to ascertain compliance with
this Article EIGHTH including, without limitation, (1) the number of
shares of Voting Stock beneficially owned by any person, (2) whether a
person is an Affiliate or Associate of another, (3) whether the assets
which are the subject of any Business Combination have, or the
consideration to be received for the issuance or transfer of
securities by the Corporation or any Subsidiary of the Corporation in
any Business Combination has, an aggregate Fair Market Value of
$100 million or more, and (4) whether all of the applicable conditions
set forth in paragraph I(2) of this Article EIGHTH have been met with
respect to any Business Combination. Any determination pursuant to
this Article EIGHTH made in good faith shall be binding and conclusive
on all parties.
V. The directors of the Corporation, when evaluating any
proposal or offer which would involve a Business Combination or the
merger or consolidation of the Corporation or any of its Subsidiaries
with another corporation, the sale of all or substantially all of the
assets of the Corporation or any of its Subsidiaries, a tender offer
or exchange offer for any capital stock of the Corporation or any of
its Subsidiaries or any similar transaction shall give due
consideration to all factors they may consider relevant. Such factors
may include, without limitation, (a) the adequacy, both in amount and
form, of the consideration offered in relation not only to the current
market price of the Corporation's outstanding securities, but also the
current value of the Corporation in a freely negotiated transaction
with other potential acquirers and the Board's estimate of the
Corporation's future value (including the unrealized value of its
properties, assets and prospects) as an independent going concern, (b)
the financial and managerial resources and future prospects of the
acquirer, and (c) the legal, economic, environmental, regulatory and
social effects of the proposed transaction on the Corporation's and
its Subsidiaries' employees, customers, suppliers and other affected
persons and entities and on the communities and geographic areas in
which the Corporation and its Subsidiaries provide utility service or
are located, and in particular, the effect on the Corporation's and
its Subsidiaries' ability to safely and reliably meet any public
utility obligations at reasonable rates.
VI. Nothing herein shall be construed to relieve any
Related Person from any fiduciary obligation imposed by law.
3. The foregoing amendments and restatement of the Articles of
Incorporation have been duly approved by the Board of Directors of the
corporation.
4. The foregoing amendments and restatement of the Articles of
Incorporation (other than the omissions required by Section 910 of the
California Corporations Code) have been duly approved by the required
vote of the shareholders in accordance with Section 902 of the
California Corporations Code. The corporation has only one class of
shares issued and outstanding which is common stock. The number of
outstanding shares entitled to vote with respect to the foregoing
amendments is 361,010,299. The number of shares voted in favor of the
amendments exceeded the vote required. The percentage vote required
for approval of the amendments was more than 50%.
We further declare under penalty of perjury under the laws
of the State of California that the matters set forth in this
certificate are true and correct of our own knowledge.
Date: May 4, 2000
/S/ ROBERT D. GLYNN, JR.
_____________________________________
ROBERT D. GLYNN, JR.
Chairman of the Board,
Chief Executive Officer, and
President
/S/ LESLIE H. EVERETT
_____________________________________
LESLIE H. EVERETT
Vice President and
Corporate Secretary