Exhibit 3.4
-----------
CERTIFICATE OF DESIGNATION
OF THE
SERIES B 7 1/2% CUMULATIVE CONVERTIBLE PREFERRED STOCK
OF
WEBSTER FINANCIAL CORPORATION
----------
Pursuant to Section 151(g) of the
General Corporation Law of the State of Delaware
----------
The undersigned DOES HEREBY CERTIFY that the following
resolution was duly adopted on December 21, 1992, by the Board of Directors (the
"Board") of WEBSTER FINANCIAL CORPORATION, a Delaware corporation (the
"Corporation"), acting pursuant to the authority granted to the Board in
accordance with the provisions of Section 151(g) of the General Corporation Law
of the State of Delaware, at a duly convened meeting of the Board at which a
quorum was present and active throughout (the "Authorizing Board Resolution"):
RESOLVED, that pursuant to authority expressly granted to and
vested in the Board by the provisions of the Certificate of Incorporation of the
Corporation (the "Certificate of Incorporation"), there is hereby created a
series of serial preferred stock, par value $.01 per share, which shall consist
of 250,000 of the 3,000,000 shares of serial preferred stock. Such series shall
have the following powers, designations, preferences and relative,
participating, optional and other special rights, and the qualifications,
limitations and restrictions (in addition to the powers, designations,
preferences and relative, participating, optional or other special rights, and
the qualifications, limitations or restrictions thereof, set forth in the
Certificate of Incorporation which may be applicable to the serial preferred
stock) as follows:
I. DESIGNATION AND AMOUNT. The series of serial preferred
stock authorized by this resolution shall be designated the Series B 7 1/2%
Cumulative Convertible Preferred Stock (the "Series B Stock"). The number of
shares of Series B Stock shall be 250,000. The liquidation value of the Series B
Series B Stock shall be issued as full shares and have a par value of $.01 per
share.
II. DIVIDENDS AND DISTRIBUTIONS.
(a) The shares of Series B Stock will be entitled to receive,
when, as and if declared by the Board out of funds of the Corporation legally
available therefor, cumulative cash dividends at an annual rate of 7.50% and no
more, payable in cash on April 1, 1993, with respect to the period commencing on
the date of initial issuance and ending on March 31, 1993, and thereafter
quarterly on each July 1, October 1, January 1, and April 1, commencing July 1,
1993 (each a "Dividend Payment Date") with respect to the quarterly periods
ending on June 30, September 30, December 31, and March 31 of each year.
Dividends on the Series B Stock will be cumulative from the date of initial
issuance of shares of Series B Stock. Dividends will be payable to holders of
record as they appear on the stock books of the Corporation on such record
dates, not more than 30 days nor less than 15 days preceding the payment dates
thereof, as shall be fixed by the Board (each a "Dividend Payment Record Date").
If dividends are not paid in full upon the Series B Stock and any other
preferred stock ranking on a parity as to dividends with the Series B Stock, all
dividends declared upon shares of Series B Stock and such other preferred stock
will be declared pro rata so that in all cases the amount of dividends declared
per share on the Series B Stock and such other preferred stock bear to each
other the same ratio that accumulated and unpaid dividends per share on the
shares of the Series B Stock and such other preferred stock bear to each other.
Unless full cumulative dividends on the Series B Stock shall have been paid,
dividends (other than in Common Stock (as defined in paragraph III below), other
stock ranking junior to the Series B Stock and rights to acquire the foregoing)
may not be paid or declared and set aside for payment and other distributions
may not be made upon the Common Stock or on any other stock of the Corporation
ranking junior to Series B Stock as to dividends. Dividends payable for any
partial dividend period shall be calculated on the basis of a 360-day year of
twelve 30-day months. Accrued but unpaid dividends shall not bear interest.
III. RANK. The shares of Series B Stock shall rank prior to
the shares of the Corporation's common stock, par value $.01 per share (the
"Common Stock") and of any other class or series of stock of the Corporation
ranking junior to the Series B Stock upon liquidation ("Junior Liquidation
Stock"), so that in the event of any liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary, the holders of the Series B
Stock shall be entitled to receive out of the assets of the Corporation
available for distribution to its stockholders before any distribution is made
to holders of shares of Common Stock or any Junior Liquidation Stock, an amount
equal to $100.00 per share (the "Liquidation Preference"), plus an amount equal
to all dividends (whether or not earned or declared) accumulated and unpaid on
the shares of Series B Stock to the date of final distribution. If, upon any
liquidation, dissolution or winding up of the Corporation, the assets of the
Corporation, or proceeds thereof, distributable among the holders of shares of
Series B Stock shall be insufficient to pay in full the preferential amount
described in the preceding sentence, then such assets, or the
-2-
proceeds thereof, shall be distributable among the holders of the Series B Stock
ratably in accordance with the respective amounts which would be payable on such
shares if all amounts payable thereon were paid in full. After payment of the
full amount of the Liquidation Preference and accumulated dividends to which
holders of shares of Series B Stock are entitled, the holders of shares of
Series B Stock will not be entitled to any further participation in any
distribution of assets by the Corporation. For the purposes hereof, neither a
consolidation or merger of the Corporation with or into any other corporation,
nor a sale or transfer of all or any part of the Corporation's assets for cash
or securities, shall be considered a liquidation, dissolution or winding up of
the Corporation.
For purposes of this resolution any stock of any class or
series of the Corporation shall be deemed to rank:
(a) prior to shares of the Series B Stock, either as to
dividends or upon liquidation, if the holders of stock of such class or series
shall be entitled by the terms thereof to the receipt of dividends or of amounts
distributable upon liquidation, dissolution or winding up, as the case may be,
in preference or priority to the holders of shares of the Series B Stock;
(b) on a parity with shares of the Series B Stock, either as
to dividends or upon liquidation, whether or not the dividend rates, dividend
payment dates, or redemption or liquidation prices per share thereof shall be
different from those of the Series B Stock, if the holders of stock of such
class or series shall be entitled by the terms thereof to the receipt of
dividends or of amounts distributable upon liquidation, dissolution or winding
up, as the case may be, in proportion to their respective dividend rates or
liquidation prices, without preference or priority of one over the other between
the holders of such stock and the holders of shares of Series B Stock (the term
"Parity Preferred Stock" being used to refer to the Series A Cumulative
Perpetual Preferred Stock and to any other class or series of stock of the
Corporation ranking on a parity with the shares of Series B Stock, either as to
dividends or upon liquidation; and
(c) junior to shares of the Series B Stock, either as to
dividends or upon liquidation, if such class shall be Common Stock or if the
holders of the Series B Stock shall be entitled to the receipt of dividends or
of amounts distributable upon liquidation, dissolution or winding up, as the
case may be, in preference or priority to the holders of stock of such class or
series.
IV. CONVERSION.
(a) Subject to and upon compliance with the provisions of this
paragraph IV, the holder of any shares of Series B Stock shall have the right,
at his option, at any time prior to the close of business on the third business
day next preceding the date fixed for redemption of such share as herein
provided, unless the
-3-
Corporation has defaulted in making payment due on redemption, to convert the
shares into a number of fully paid and nonassessable shares of Common Stock
(calculated as to each conversion to the nearest 1/100th of a share) equal to
$100.00 for each share surrendered for conversion divided by the Conversion
Price (as defined in subparagraph IV(d) below) by surrendering the shares to be
converted, in the manner provided in subparagraph IV(b) below.
(b) (i) In order to exercise the conversion privilege, the
holder of each share of Series B Stock to be converted shall surrender the
certificate representing such share to the Conversion Agent for the Series B
Stock appointed for such purpose by the Corporation (the "Conversion Agent"),
with the Notice of Election to Convert on the back of such certificate duly
completed and signed, together with funds equal to the Dividend Amount, if any,
required to be paid under subparagraph IV(b)(ii) below, at the principal office
of the Conversion Agent. Unless the shares issuable on conversion are to be
issued in the same name as the name in which the shares of Series B Stock are
registered, each share surrendered for conversion shall be accompanied by an
instrument of transfer, in form satisfactory to the Corporation, duly executed
by the holder or his duly authorized attorney and by funds in an amount
sufficient to pay any transfer or similar tax.
(ii) The holders of shares of Series B Stock at the
close of business on a Dividend Payment Record Date shall be entitled to receive
the dividend payable on those shares on the corresponding Dividend Payment Date
notwithstanding the conversion of the shares after the Dividend Payment Record
Date or the Corporation's default in payment of the dividend due on the Dividend
Payment Date. However, shares of Series B Stock surrendered for conversion
during the period between the close of business on any Dividend Payment Record
Date and the opening of business on the corresponding Dividend Payment Date
(except shares called for redemption on a date fixed for redemption during that
period) must be accompanied by payment of an amount equal to the dividend
payable on the shares on the Dividend Payment Date (the "Dividend Amount"). The
holders of shares of Series B Stock on a Dividend Payment Record Date who (or
whose transferees) convert any of those shares on or after the corresponding
Dividend Payment Date will receive the dividend payable by the Corporation on
those shares of Series B Stock on the Dividend Payment Date, and need not
include payment of the Dividend Amount upon surrender of those shares for
conversion. Except as provided above, the Corporation shall make no payment or
adjustment for accrued and unpaid dividends on shares of Series B Stock, whether
or not in arrears, on conversion of those shares, or for dividends on the shares
of Common Stock issued upon the conversion.
(iii) As promptly as practicable after the surrender
by a holder of the certificates for shares of Series B Stock in accordance with
this subparagraph IV(b), the Corporation shall issue and shall deliver at the
office of the conversion agent to the holder, or on his written order, a
certificate or certificates for the
-4-
number of full shares of Common Stock issuable upon the conversion of those
shares in accordance with the provisions of this paragraph IV, and any
fractional interest in respect of a share of Common Stock arising upon the
conversion shall be settled as provided in subparagraph IV(c) below.
(iv) each conversion shall be deemed to have been
effected immediately prior to the close of business on the date on which all of
the conditions specified in subparagraph IV(b)(i) above shall have been
satisfied, and, the person or persons in whose name or names any certificate or
certificates for shares of Common Stock shall be issuable upon such conversion
shall be deemed to have become the holder or holders of record of the shares of
Common Stock represented by those certificates at such time on such date and
such conversion shall be at the Conversion Price in effect at such time on such
date, unless the stock transfer books of the Corporation shall be closed on that
date, in which event such person or persons shall be deemed to have become such
holder or holders of record at the close of business on the next succeeding day
on which such stock transfer books are open, but such conversion shall be at the
Conversion Price in effect on the date upon which all of the conditions
specified in subparagraph IV(b)(i) above shall have been satisfied. All shares
of Common Stock delivered upon conversion of the Series B Stock will upon
delivery be duly and validly issued and fully paid and non-assessable, free of
all liens and charges and not subject to any preemptive rights. Upon the
surrender of certificates representing shares of Series B Stock to be converted,
the shares shall no longer be deemed to be outstanding and all rights of a
holder with respect to the shares surrendered for conversion shall immediately
terminate except the right to receive the Common Stock or other securities, cash
or other assets as herein provided.
(c) No fractional shares or securities representing fractional
shares of Common Stock shall be issued upon conversion of Series B Stock. Any
fractional interest in a share of Common Stock resulting from conversion of a
share of Series B Stock shall be paid in cash (computed to the nearest cent)
based on the price (as defined in subparagraph IV(d)(iv) below) of the Common
Stock on the Trading Day (as defined in subparagraph IV(d)(iv) below) next
preceding the day of conversion. If more than one share shall be surrendered for
conversion at one time by the same holder, the number of full shares of Common
Stock issuable upon the conversion shall be computed on the basis of the
aggregate Liquidation Preference of the shares of Series B Stock so surrendered.
(d) The "Conversion Price" per share of Series B Stock shall
be $19.17, subject to adjustment from time to time as follows:
(i) In case the Corporation shall (A) pay a dividend
or make a distribution on its Common Stock in shares of its Common Stock, (B)
subdivide its outstanding Common Stock into a greater number of shares, or (C)
combine its outstanding Common Stock into a smaller number of shares, the
Conversion Price
-5-
in effect immediately prior to such event shall be proportionably adjusted so
that the holder of any share of Series B Stock thereafter surrendered for
conversion shall be entitled to receive the number and kind of shares of Common
Stock of the Corporation which he would have been entitled to receive had the
share been converted immediately prior to the happening of such event. An
adjustment made pursuant to this subparagraph IV(d)(i) shall become effective
immediately after the record date in the case of a dividend or distribution
except as provided in subparagraph IV(d)(vii) below, and shall become effective
immediately after the effective date in the case of subdivision or combination.
If any dividend or distribution is not paid or made, the Conversion Price then
in effect shall be appropriately readjusted.
(ii) In case the Corporation shall issue rights or
warrants to all holders of its Common Stock entitling them (for a period
expiring within 45 days after the record date referred to below) to subscribe
for or purchase Common Stock at a price per share less than the Current Market
Price (as defined in subparagraph IV(d)(iv) below) of the Common Stock at the
record date for the determination of stockholders entitled to receive the rights
or warrants, the Conversion Price in effect immediately prior to the issuance of
such rights or warrants shall be adjusted so that it shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the date of issuance of the rights or warrants by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding on the date
of issuance of the rights or warrants plus the number of shares of Common Stock
which the aggregate offering price of the total number of shares of Common Stock
so offered for subscription or purchase would purchase at the Current Market
Price at that record date, and of which the denominator of which shall be the
number of shares of Common Stock outstanding on the date of issuance of the
rights or warrants plus the number of additional shares of Common Stock offered
for subscription or purchase. The adjustment provided for in this subparagraph
IV(d)(ii) shall be made successively whenever any such rights or warrants are
issued, and shall become effective immediately, except as provided in
subparagraph IV(d)(vii) below after such record date. In determining whether any
rights or warrants entitle the holders of the Common Stock to subscribe for or
purchase shares of Common Stock at less than the Current Market Price, and in
determining the aggregate offering price of the shares of Common Stock so
offered, there shall be taken into account any consideration received by the
Corporation for such rights or warrants, the value of such consideration, if
other than cash, to be determined by the Board (whose determination, if made in
good faith, shall be conclusive). If any or all of such rights or warrants are
not so issued or expire or terminate without having been exercised, the
Conversion Price then in effect shall be appropriately readjusted.
(iii) In case the Corporation shall distribute to all
holders of its Common Stock any shares of capital stock of the Corporation
(other than Common Stock) or evidences of indebtedness or assets (excluding cash
dividends or
-6-
distributions paid from retained earnings of the Corporation) or rights or
warrants to subscribe for or purchase any of its securities (excluding those
referred to in subparagraph IV(d)(ii) above) then, in each such case, the
Conversion Price shall be adjusted so that it shall equal the price determined
by multiplying the Conversion Price in effect immediately prior to the date of
the distribution by a fraction of which the numerator shall be the Current
Market Price of the Common Stock on the record date mentioned below less the
then fair market value (as determined by the Board, whose determination, if made
in good faith, shall be conclusive) of the portion of the capital stock or
assets or evidences of indebtedness so distributed, or of the rights or warrants
so distributed, with respect to one share of Common Stock, and of which the
denominator shall be the Current Market Price of the Common Stock on the record
date. Such adjustment shall become effective immediately, except as provided in
subparagraph IV(d) below, after the record date for the determination of
shareholders entitled to receive such distribution. If any such distribution is
not made or if any or all of such rights or warrants expire or terminate without
having been exercised, the Conversion Price then in effect shall be
appropriately readjusted. Notwithstanding the foregoing, in the event that the
Company shall distribute rights or warrants (other than those referred to in
subparagraph IV(d)(ii) above) ("Rights") pro rata to holders of Common Stock,
the Company may, in lieu of making any adjustment pursuant to this Subparagraph
IV(d)(ii), make proper provision so that each holder of Series B Stock who
converts such Series B Stock (or any portion thereof) after the record date for
such distribution and prior to the expiration or redemption of the Rights shall
be entitled to receive upon such conversion, in addition to the shares of Common
Stock issuable upon such conversion (the "Conversion Shares"), a number of
Rights to be determined as follows: (i) if such conversion occurs on or prior to
the date for the distribution to the holders of Rights of separate certificates
evidencing such Rights (the "Distribution Date"), the same number of Rights to
which a holder of a number of shares of Common Stock equal to the number of
Conversion Shares is entitled at the time of such conversion in accordance with
the terms and provisions of and applicable to the Rights; and (ii) if such
conversion occurs after the Distribution Date, the same number of rights to
which a holder of the number of shares of Common Stock into which the number of
shares of Series B Stock so converted was convertible immediately prior to the
Distribution Date would have been entitled on the Distribution Date in
accordance with the terms and provisions of and applicable to the Rights.
(iv) For the purpose of any computation under
subparagraphs IV(d)(ii) and IV(d)(iii) above, the "Current Market Price" of the
Common Stock at any date shall be the average of the last reported sale prices
per share for the ten consecutive Trading Days (as defined below) preceding the
date of such computation. The last reported sale price for each day shall be (A)
the last reported sale price of the Common Stock on the National Market System
of the National Association of Securities Dealers, Inc. Automated Quotation
System (the "NASDAQ National Market System"), or any similar system of automated
dissemination of
-7-
quotations of securities prices then in common use, if so quoted, or (B) if not
quoted as described in clause (A), the mean between the high bid and low asked
quotations for the Common Stock as reported by the National Quotation Bureau
Incorporated if at least two securities dealers have inserted both bid and asked
quotations for the Common Stock on at least five of the ten preceding days, or
(C) if the Common Stock is listed or admitted for trading on any national
securities exchange, the last sale price, or the closing bid price if no sale
occurred, of the Common Stock on the principal securities exchange on which the
Common Stock is listed. If the Common Stock is quoted on a national securities
or central market system in lieu of a market or quotation system described
above, the last reported sale price shall be determined in the manner set forth
in clause (B) of the preceding sentence if bid and asked quotations are reported
but actual transactions are not, and in the manner set forth in clause (C) of
the preceding sentence if actual transactions are reported. If none of the
conditions set forth above is set, the last reported sale price of the Common
Stock on any day or the average of such last reported sale prices for any period
shall be the fair market value of such class of stock as determined by a member
firm of the New York Stock Exchange, Inc. selected by the Corporation. As used
herein the term "Trading Days" means (x) if the Common Stock is quoted on the
NASDAQ National Market System or any similar system of automated dissemination
of quotations of securities prices, days on which trades may be made on such
system, or (y) if not quoted as described in clause (x), days on which
quotations are reported by the National Quotation Bureau Incorporated, or (z) if
the Common Stock is listed or admitted for trading on any national securities
exchange, days on which such national securities exchange is open for business.
(v) No adjustment in the Conversion Price shall be
required unless such adjustment would require a change of at least one percent
in the Conversion Price; provided, however, that any adjustments which by reason
of this subparagraph IV(d)(v) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment; and provided,
further, that adjustment shall be required and made in accordance with the
provisions of this paragraph IV (other than this subparagraph IV(d)(v)) not
later than such time as may be required in order to preserve the tax free nature
of a distribution to the holders of shares of Common Stock. All calculations
under this paragraph IV shall be made to the nearest cent or to the nearest one
hundredth of a share, as the case may be. Anything in this subparagraph IV(d) to
the contrary notwithstanding, the Corporation shall be entitled to make such
reductions in the Conversion Price, in addition to those required by this
subparagraph IV(d), as it in its discretion shall determine to be advisable in
order that any stock dividend, subdivision or combination of shares,
distribution of capital stock or rights or warrants to purchase stock or
securities, or distribution of evidences of indebtedness or assets (other than
cash dividends or distributions paid from retained earnings) hereafter made by
the Corporation to its stockholders shall be a tax free distribution for federal
income tax purposes.
-8-
(vi) Whenever the Conversion Price is adjusted, as
herein provided, the Corporation shall promptly file with the conversion agent
an officers' certificate setting forth the Conversion Price after the adjustment
and setting forth a brief statement of the facts requiring the adjustment, which
certificate shall be conclusive evidence of the correctness of the adjustment.
Promptly after delivery of the certificate, the Corporation shall prepare a
notice of the adjustment of the Conversion Price setting forth the adjusted
Conversion Price and the date on which the adjustment becomes effective and
shall mail the notice of such adjustment of the Conversion Price to the holder
of each share of Series B Stock at his last address as shown on the stock books
of the Corporation.
(vii) In any case in which this paragraph IV(d)
provides that an adjustment shall become effective immediately after a record
date for an event, the Corporation may defer until the occurrence of the event
(i) issuing to the holder of any share of Series B Stock converted after the
record date and before the occurrence of the event the additional shares of
Common Stock issuable upon the conversion by reason of the adjustment required
by the event over and above the Common Stock issuable upon such conversion
before giving effect to the adjustment and (ii) paying to the holder any amount
in cash in lieu of any fractional share pursuant to subparagraph IV(c) above.
(e) If:
(i) the Corporation shall authorize the granting to
the holders of the Common Stock of rights or warrants to subscribe for or
purchase any shares of any class or any other rights or warrants; or
(ii) there shall be any reclassification of the
Common Stock (other than a subdivision or combination of the outstanding Common
Stock and other than a change in the par value, or from par value to no par
value, or from no par value to par value), or any consolidation, merger, or
statutory share exchange to which the Corporation is a party and for which
approval of any stockholders of the Corporation is required, or any sale or
transfer of all or substantially all the assets of the Corporation; or
(iii) there shall be a voluntary or an involuntary
dissolution, liquidation or winding up of the Corporation; then the Corporation
shall cause to be filed with the conversion agent, and shall cause to be mailed
to the holders of shares of the Series B Stock at their addresses as shown on
the stock books of the Corporation, at least 15 days prior to the applicable
date hereinafter specified, a notice stating (A) the date on which a record is
to be taken for the purpose of the dividend, distribution or rights or warrants,
or, if a record is not to be taken, the date as of which the holders of Common
Stock of record to be entitled to the dividend, distribution or rights or
warrants are to be determined or (B) the date on which the reclassification,
consolidation, merger, statutory share exchange, sale,
-9-
transfer, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their shares of Common Stock for
securities or other property deliverable upon the reclassification,
consolidation, merger, statutory share exchange, sale, transfer, dissolution,
liquidation or winding up. Failure to give any such notice or any defect in the
notice shall not affect the legality or validity of' the proceedings described
in this subparagraph IV(e).
(f) (i) The Corporation covenants that it will at all times
reserve and keep available, free from preemptive rights, out of the aggregate of
its authorized but unissued shares of Common Stock or its issued shares of
Common Stock held in its treasury, or both, for the purpose of effecting
conversions of the Series B Stock, the full number of shares of Common Stock
deliverable upon the conversion of all outstanding shares of Series B Stock not
theretofore converted. For purposes of this subparagraph IV(f), the number of
shares of Common Stock which shall be deliverable upon the conversion of all
outstanding shares of Series B Stock shall be computed as if at the time of
computation all the outstanding shares were held by a single holder.
(ii) The Corporation will endeavor to list the shares
of Common Stock required to be delivered upon conversion of the Series B Stock,
prior to the delivery, upon each national securities exchange, if any, upon
which the outstanding Common Stock is listed at the time of delivery.
(iii) Prior to the delivery of any securities which
the Corporation shall be obligated to deliver upon conversion of the Series B
Stock, the Corporation will endeavor, in good faith and as expeditiously as
possible, to comply with all federal and state laws and regulations thereunder
requiring the registration of those securities with, or any approval of or
consent to the delivery thereof by, any governmental authority.
(g) The Corporation will pay any and all documentary stamp or
similar issue or transfer taxes payable in respect of the issue or delivery of
shares of Common Stock on conversion of the Series B Stock; provided, however,
that the Corporation shall not be required to pay any tax which may be payable
in respect of any transfer involved in the issue or delivery of shares of Common
Stock in a name other than that of the holder of the Series B Stock to be
converted and no such issue or delivery shall be made unless and until the
person requesting the issue or delivery has paid to the Corporation the amount
of any such tax or has established, to the satisfaction of the Corporation, that
the tax has been paid.
(h) In case of any reclassification or change of outstanding
shares of Common Stock (other than a change in par value, or as a result of a
subdivision or combination), or in case of any consolidation of the Corporation
with, or merger of the Corporation with or into, any other entity that results
in a reclassification,
-10-
change, conversion, exchange or cancellation of outstanding shares of Common
Stock or any sale or transfer of all or substantially all of the assets of the
Corporation, each holder of shares of Series B Stock then outstanding shall have
the right thereafter to convert the shares of Series B Stock held by the holder
into the kind and amount of securities, cash and other property which the holder
would have been entitled to receive upon such reclassification, change,
consolidation, merger, sale or transfer if the holder had held the Common Stock
issuable upon the conversion of the shares of Series B Stock immediately prior
to the reclassification, change, consolidation, merger, sale or transfer.
(i) In the event that the Corporation shall consummate any
consolidation or merger or similar business combination, pursuant to which the
outstanding shares of Common Stock are by operation of law exchanged solely for
or changed, reclassified or converted into stock, securities or cash or any
other property, or any combination thereof, the Series B Stock shall, in
connection with such consolidation, merger or similar business combination, be
assumed by and shall become preferred stock of such successor or resulting
corporation, having in respect of such corporation, insofar as possible, the
same powers, preferences and relative rights, and the qualifications,
limitations or restrictions thereon, that the Series B Stock had immediately
prior to such transaction, except that after such transaction each share of
Series B Stock shall be convertible, otherwise on the terms and conditions
provided by paragraph (IV) above, into the nature and kind of consideration so
receivable by a holder of the number of shares of Common Stock into which such
shares of Series B Stock could have been converted immediately prior to such
transaction; provided, however, that if, by virtue of the structure of such
transaction, a holder of Common Stock is required to make an election with
respect to the nature and kind of consideration to be received in such
transaction, which election cannot practicably be made by the holder of the
shares of Series B Stock, then the shares of Series B Stock shall, by virtue of
such transaction and on the same terms as apply to the holders of Common Stock,
be converted into or exchanged for the aggregate amount of stock, securities,
cash or other property (payable in kind) receivable by a holder of the number of
shares of Common Stock into which such shares of Series B Stock could have been
converted immediately prior to such transaction if such holder of Common Stock
failed to exercise any rights of election (however, if the kind or amount of
consideration receivable upon such transaction is not the same for each
non-electing share of Common Stock, then the kind and amount so receivable upon
such transaction shall be the kind and amount so receivable per share by the
plurality of the non-electing shares of Common Stock). The rights of the Series
B Stock as preferred stock of such successor or resulting corporation shall
successively be subject to adjustments pursuant to paragraph (VI) and
subparagraph (IV)(d) hereof after any such transaction as nearly equivalent as
practicable to the adjustment provided for by such paragraphs prior to such
transaction. The Corporation shall not consummate any such merger, consolidation
or similar transaction unless all then outstanding
-11-
shares of Series B Stock shall be assumed and authorized by the successor or
resulting corporation as aforesaid.
V. STATUS. Upon any conversion, exchange or redemption of
shares of Series B Stock, the shares of Series B Stock so converted, exchanged
or redeemed shall have the status of authorized and unissued shares of serial
preferred stock, and the number of shares of serial preferred stock which the
Corporation shall have authority to issue shall not be decreased by the
conversion, exchange or redemption of shares of Series B Stock.
VI. VOTING RIGHTS. The holders of shares of Series B Stock
shall have no voting rights whatsoever, except for any voting rights to which
they may be entitled under the laws of the State of Delaware, and except as
follows:
(a) (i) If and whenever at any time or times dividends payable
on the Series B Stock shall have been in arrears and unpaid in an aggregate
amount equal to or exceeding the amount of dividends payable thereon for six
quarterly periods, then the holders of a majority of the outstanding shares of
the Series B Stock shall have the right to name two additional members of the
Board of the Corporation, and such members shall take office at the next meeting
of the Board of the Corporation. If any vacancy shall occur among the directors
named by the holders of the shares of this Series B Stock pursuant to this
subparagraph, such vacancy shall be filled with such person as a majority of
such holders may name in a written notice to the Corporation. Any director named
by the holders of the shares of this Series B Stock pursuant to this paragraph
shall serve until all dividends accumulated on the Series B Stock have been paid
in full. Upon such payment all directors named by the holders of the shares
pursuant to this subparagraph who are then in office shall automatically cease
to be members of the Board of Directors of the Corporation, provided, however,
that the right of the holders of the shares of this Series B Stock to name two
directors shall be reinstated if thereafter the Corporation fails to declare and
pay dividends in cash on the outstanding shares of this Series B Stock with
respect to any six subsequent quarterly periods.
(ii) Whenever the voting rights described in
subparagraph VI(a)(i) above shall have vested and remain in effect, the
Corporation shall not, either directly or indirectly or through merger or
consolidation with or into any other corporation, without the affirmative vote
at a meeting or the written consent with or without a meeting of the holders of
at least a majority of the number of shares of the Series B Stock then
outstanding, create or issue or increase the authorized number of shares of any
class or series of stock ranking prior to the Series B Stock either as to
dividends or upon liquidation.
(b) So long as any shares of the Series B Stock remain
outstanding, the Corporation shall not, either directly or indirectly or through
merger or
-12-
consolidation with or into any other corporation, without the affirmative vote
at a meeting or the written consent with or without a meeting of the holders of
at least two-thirds of the number of shares of the Series B Stock then
outstanding, (i) amend, alter or repeal any of the provisions of the Certificate
of Incorporation (including the Authorizing Board Resolution) so as to affect
adversely the preference or power of the Series B Stock, (ii) authorize any
reclassification of the Series B Stock, or (iii) issue any shares of any class
or series of stock of the Corporation ranking prior to the shares of the Series
B Stock as to dividends or upon liquidation, or reclassify any authorized stock
of the Corporation into any such prior shares or issue any obligation or
security convertible into or evidencing the right to purchase any such prior
shares.
VII. REDEMPTION BY THE CORPORATION.
(a) The shares of Series B Stock may be redeemed for cash at
the option of the Corporation, in whole, or from time to time in part, at any
time on or after January 15, 1997, on at least 15 but not more than 60 days'
prior notice mailed to the holders of the shares to be redeemed, at the
applicable redemption price (as defined below), together in each case with an
amount equal to all dividends (whether or not earned or declared) accumulated
and unpaid to the date fixed for redemption.
The applicable redemption prices per share are as follows:
If Redeemed During
12-month Period Redemption Price
Beginning January 15 Per Share
-------------------- ---------
1997 $104.50
1998 $103.75
1999 $103.00
2000 $102.25
2001 $101.50
2002 $100.75
2003 (or thereafter) $100.00
(b) If full cumulative dividends on the Series B Stock have
not been paid through the most recent Dividend Payment Date, the Series B Stock
may not be redeemed in part and the Corporation may not purchase or acquire any
shares of the Series B Stock otherwise than pursuant to a purchase or exchange
offer made on the same terms to all holders of the Series B Stock. If less than
all the outstanding shares of Series B Stock are to be redeemed, the Corporation
will select those to be redeemed by lot or a substantially equivalent method.
-13-
(c) (i) If a notice of redemption has been given pursuant to
this paragraph VII and if, on or before the date fixed for the redemption, the
funds necessary for the redemption shall have been set aside by the Corporation,
separate and apart from its other funds, in trust for the pro rata benefit of
the holders of the shares so called for redemption, then, notwithstanding that
any certificates for those shares have not been surrendered for cancellation, on
the date fixed for redemption dividends shall cease to accrue on the shares of
Series B Stock to be redeemed, and at the close of business on the date fixed
for redemption the holders of those shares shall cease to be stockholders with
respect to those shares and shall have no interest in or claims against the
Corporation by virtue thereof and shall have no voting or other rights with
respect to the shares, except the right to receive the moneys payable upon such
redemption and the right to accumulated and unpaid dividends, without interest
thereon, upon surrender (and endorsement, if required by the Corporation) of
their certificates, and, unless the Corporation subsequently shall default in
mailing payment of these amounts, the shares evidenced thereby shall no longer
be deemed outstanding for any purpose.
(ii) If on or before the date fixed for redemption
(but not less than 15 days after the date the notice of redemption is mailed to
the holders of the Series B Stock) the Corporation shall deposit, in a trust
fund, with any bank or trust company organized under the laws of the United
States of America or any state thereof having a combined capital and surplus of
at least $5,000,000 (the "Redemption Agent") moneys sufficient to redeem on the
date fixed for redemption the shares of Series B Stock to be redeemed, with
irrevocable instructions and authority to the Redemption Agent, on behalf and at
the expense of the Corporation, to pay, on the date fixed for redemption or
prior to that date, the full amount of the consideration (consisting of the
redemption price plus accrued and unpaid dividends, if any, to the date fixed
for redemption, without interest) payable to the holders of the Series B Stock
upon the redemption, upon surrender (and endorsement, if required by the
Corporation) of their certificates, then, from and after the close of business
on the date of such deposit (although prior to the date fixed for redemption)
(the "Deposit Date"), the deposit shall be deemed to constitute full and final
payment for the shares of Series B Stock to be redeemed to the holders thereof
and, notwithstanding that any certificates for those shares have not been
surrendered for cancellation, on the date fixed for redemption dividends shall
cease to accrue on the shares of Series B Stock to be redeemed, and at the close
of business on the Deposit Date the holders of those shares shall cease to be
stockholders with respect to those shares and shall have no interest in or
claims against the Corporation by virtue thereof and shall have no voting or
other rights with respect to the shares, except the right to receive the moneys
payable upon redemption and the right to accumulated interest thereon, upon
surrender (and endorsement, if required by the Corporation) of their
certificates, and the shares evidenced thereby shall no longer be deemed
outstanding for any purpose.
-14-
(iii) Notwithstanding the foregoing, if notice of
redemption shall have given pursuant to this paragraph VII and any holder of
shares of Series B Stock shall, prior to the close of business on the date three
business days next preceding the date fixed for redemption give written notice
to the Corporation pursuant to paragraph IV above of the conversion of any or
all of the shares held by the holder (accompanied by a certificate or
certificates for such shares, duly endorsed or assigned to the Corporation),
then the redemption shall not become effective as to the shares to be converted
and the conversion shall become effective as provided in paragraph IV above.
(iv) Subject to applicable escheat laws, any moneys
necessary for redemption set aside or deposited by the Corporation and unclaimed
at the end of two years from the date fixed for redemption shall revert to the
general funds of the Corporation, after which reversion the holders of such
shares so called for redemption but not surrendered shall look only to the
general funds of the Corporation for the payment of the amounts payable upon
such redemption. Any interest accrued on funds so set aside or deposited shall
belong to the Corporation and shall be paid to it from time to time. Any funds
which have been deposited by the Corporation, or on its behalf, with a
redemption agent or segregated and held in trust by the Corporation for the
redemption of shares converted into Common Stock on or prior to the date fixed
for such redemption shall (subject to any right of the holder of such shares to
receive the dividend payable thereon as provided in paragraph IV) immediately
upon such conversion be returned to the Corporation or, if then held in trust by
the Corporation, shall be discharged from such trust.
VIII. APPROVAL OF HOLDERS. No approval of the holders of the
Series B Stock shall be required for (a) the creation of any indebtedness of any
kind of the Corporation, (b) the declaration of dividends on any of the
Corporation's capital stock which is not in violation of paragraph II hereof,
(c) the creation or issuance, or increase or decrease in the amount, of any
class or series of stock of the Corporation not ranking prior as to dividends or
upon liquidation to the Series B Stock or, except as provided in subparagraph
VI(b) above, the creation or issuance, or increase or decrease in the amount, of
any class or series of stock of the Corporation ranking prior as to dividends or
upon liquidation to the Series B Stock, (d) any increase or decrease in the
amount of authorized Common Stock or any increase, decrease or change in the par
value thereof or in any other terms thereof, (e) of any increase or decrease in
the authorized amount of preferred stock issuable by the Board of Directors in
series, or (f) any merger, consolidation or pooling of interests of any kind of
the Corporation or any of its subsidiaries which does not adversely affect the
rights or privileges of the holders of Series B Stock.
IX. NUMBER OF SHARES OF CONVERTIBLE PREFERRED STOCK. Subject
to the provisions of paragraph VI above, the Board reserves the right by
subsequent amendment of this resolution from time to time to increase or
decrease the number of shares which constitute the Series B Stock (but not below
the number of shares
-15-
thereof then outstanding) and in other respects to amend this resolution within
the limitations provided by law, the Authorizing Board Resolution and the
Certificate of Incorporation.
X. MISCELLANEOUS.
(a) Except as otherwise expressly provided, whenever in the
Authorizing Board Resolution notices or other communications are required to be
made, delivered or otherwise given to holders of shares of Series B Stock, the
notice or other communication shall be deemed properly given if deposited in the
United States mail, postage prepaid, addressed to the persons shown on the books
of the Corporation as such holders at the addresses as they appear in the books
of the Corporation, as of a record date or dates determined in accordance with
the Corporation's Certificate of Incorporation and By-laws and applicable law,
as in effect from time to time. No failure to mail a notice or any defect
therein or in the mailing thereof shall affect the validity of any proceeding
contemplated by the Authorizing Board Resolution, including without limitation
any exchange pursuant to paragraph VII above, any redemption pursuant to
paragraph VIII above or any Change of Control described in paragraph IX above.
(b) The holders of the Series B Stock will not have any
preemptive right to subscribe for or purchase any shares or any other securities
which may be issued by the Corporation.
(c) Except as may otherwise be required by law, the shares of
Series B Stock shall not have any designations, preferences, limitations or
relative rights, other than those specifically set forth in the Authorizing
Board Resolution (as such Resolution may be amended from time to time) and in
the Certificate of Incorporation.
(d) The headings of the various subdivisions hereof are for
convenience of reference only and shall not affect the interpretation of any of
the provisions hereof.
(e) If any right, preference or limitation of the Series B
Stock set forth in the Authorizing Board Resolution (as such Resolution may be
amended from time to time) is invalid, unlawful or incapable of being enforced
by reason of any rule or law or public policy, all other rights, preferences and
limitations set forth in the Authorizing Board Resolution (as so amended) which
can be given effect without the invalid, unlawful or unenforceable right,
preference or limitation shall, nevertheless, remain in full force and effect,
and no right, preference or limitation herein set forth shall be deemed
dependent upon any other such right, preference or limitation unless so
expressed herein.
-16-
IN WITNESS WHEREOF WEBSTER FINANCIAL CORPORATION has caused
this Certificate of Designation to be made under the seal of the Corporation and
signed by James C. Smith, its President, and attested by Lee A.
Gagnon, its Secretary, this 21st day of December 1992.
WEBSTER FINANCIAL CORPORATION
By: /s/ James C. Smith
------------------------
President
[SEAL]
Attest:
/s/ Lee A. Gagnon
- -----------------------
Secretary
-17-