SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
P&L COAL HOLDINGS CORPORATION
P&L COAL HOLDINGS CORPORATION (the "Corporation"), a
corporation organized and existing under the laws of the State of Delaware, DOES
HEREBY CERTIFY:
1. The name of the corporation is P&L Coal Holdings
Corporation. The date of the filing of its original Certificate of Incorporation
with the Secretary of State of the State of Delaware was February 27, 1998 under
the name of P&L Coal Holdings Corporation, and the date of the filing of its
Amended and Restated Certificate of Incorporation with the Secretary of State of
Delaware was May 15, 1998 under the name of P&L Coal Holdings Corporation.
2. This Second Amended and Restated Certificate of
Incorporation has been duly adopted in accordance with Sections 103, 242 and 245
of the General Corporation Law of the State of Delaware. The Corporation has
received payment for its stock.
3. The Board of Directors of the Corporation, pursuant to a
unanimous written action in lieu of a meeting pursuant to Section 141(f) of the
General Corporation Law of the State of Delaware, adopted resolutions proposing
and declaring advisable that the Corporation amend and restate its Amended and
Restated Certificate of Incorporation to read in its entirety as follows:
FIRST: The name of the Corporation is P&L Coal Holdings
Corporation.
SECOND: The registered office and registered agent of the
Corporation is The Corporation Trust Company, 1209 Orange Street, Wilmington,
New Castle County, Delaware 19801.
THIRD: The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
FOURTH: The total number of shares of stock that the
Corporation shall have the authority to issue is 43,000,000 shares, consisting
of 30,000,000 shares of Class A Common Stock, par value $0.01 per share (the
"Class A Common Stock"), 3,000,000 shares of Class B Common Stock, par value
$0.01 per share (the "Class B Common Stock" and, together with the Class A
Common Stock, the "Common Stock"), and 10,000,000 shares of Non-Convertible,
Exchangeable Preferred Stock, par value of $0.01 per share (the "Preferred
Stock"). Set forth below with respect to each type of stock of the Corporation
is a statement of the voting powers and the designations, preferences, rights,
qualifications, limitations and restrictions thereof:
A. Class A Common Stock.
1. Voting Rights. Except as may otherwise be required by law,
each holder of Class A Common Stock (together with the holders of Class
B Common Stock and the holders of Preferred Stock) shall have one vote
in respect of each share of Class A Common Stock held on all matters
voted upon by the stockholders of the Corporation.
2. Dividends. The holders of Class A Common Stock (together
with the holders of Class B Common Stock and the holders of Preferred
Stock) shall be entitled to receive such dividends as may be declared
from time to time by the Board of Directors of the Corporation ratably
in proportion to the number of shares of Class A Common Stock (and
Class B Common Stock and Preferred Stock) held by them.
3. Distributions. Subject to the limitations set forth in
Section C.3 of this Article FOURTH, in the event of any Liquidation
Event, following Payment in Full of the Preference Amount to the
holders of Preferred Stock, the holders of Class A Common Stock shall
be entitled to receive all of the remaining Available Assets ratably in
proportion to the number of shares of Class A Common Stock held by them
until they receive Payment in Full of the Preference Amount. If such
remaining Available Assets shall be insufficient to distribute to the
holders of shares of Class A Common Stock the Payment in Full of the
Preference Amount to which they are entitled (after Payment in Full of
the Preference Amount to the holders of shares of Preferred Stock), the
holders of shares of Class A Common Stock shall share ratably in any
distribution of Available Assets in proportion to the number of shares
of Class A Common Stock held by them. After Payment in Full of the
Preference Amount to the holders of shares of Preferred Stock pursuant
to Section C.3, to the holders of shares of Class A Common Stock
pursuant to this Section A.3 and to the holders of shares of Class B
Common Stock pursuant to Section B.3, the holders of Class A Common
Stock shall be entitled (together with the holders of Class B Common
Stock and the holders of Preferred Stock) to receive any remaining
Available Assets ratably in proportion to the number of shares of Class
A Common Stock (and Class B Common Stock and Preferred Stock) held by
them.
B. Class B Common Stock.
1. Voting Rights. Except as may otherwise be required by law,
each holder of Class B Common Stock (together with the holders of Class
A Common Stock and the holders of Preferred Stock) shall have one vote
in respect of each share of Class B Common Stock held on all matters
voted upon by the stockholders of the Corporation.
2. Dividends. The holders of Class B Common Stock (together
with the holders of the Class A Common Stock and the holders of
Preferred Stock) shall be entitled to receive such dividends as may be
declared from time to time by the Board of Directors of the Corporation
ratably in proportion to the number of shares of Class B Common Stock
(and Class A Common Stock and Preferred Stock) held by them.
3. Distributions. Subject to the limitations set forth in
Sections A.3 and C.3 of this Article FOURTH, in the event of any
Liquidation Event, following Payment in Full of the Preference Amount
to the holders of Preferred Stock and the holders of Class A Common
Stock, the holders of Class B Common Stock shall be entitled to receive
all of the remaining Available Assets ratably in proportion to the
number of shares of Class B Common Stock held by them until they
receive Payment in Full of the Preference Amount. If such remaining
Available Assets shall be insufficient to distribute to the holders of
shares of Class B Common Stock the Payment in Full of the Preference
Amount to which they are entitled (after Payment in Full of the
Preference Amount to the holders of shares of Class A Common Stock and
the holders of Preferred Stock), the holders of shares of Class B
Common Stock shall share ratably in any distribution of Available
Assets in proportion to the number of shares of Class B Common Stock
held by them. After Payment in Full of the Preference Amount to the
holders of shares of Preferred Stock pursuant to Section C.3, to the
holders of shares of Class A Common Stock pursuant to Section A.3 and
to the holders of shares of Class B Common Stock pursuant to this
Section B.3, the holders of Class B Common Stock shall be entitled
(together with the holders of Class A Common Stock and the holders of
Preferred Stock) to receive any remaining Available Assets ratably in
proportion to the number of shares of Class B Common Stock (and Class A
Common Stock and Preferred Stock) held by them.
4. Conversion.
a. Immediately following the earliest of (i) the ninth
anniversary of the initial issuance of shares of Class B Common Stock,
(ii) the consummation of a Change of Control, an Initial Public
Offering or a Recapitalization Event and (iii) the date of an election
by the Board of Directors of the Corporation to convert the outstanding
shares of Class B Common Stock into Class A Common Stock, all of the
shares of Class B Common Stock shall be converted, without action on
the part of any holder thereof, into the same number of shares of Class
A Common Stock.
b. Each conversion of shares of Class B Common Stock into the
same number of shares of Class A Common Stock shall be completed by the
surrender of the certificate or certificates representing the shares
(the "Shares for Conversion") converted at the principal office of the
Corporation (or such other office or agency of the Corporation as the
Corporation may from time to time designate by notice in writing to the
holders of Class B Common Stock) at any time during normal business
hours. Such conversion shall be deemed to have been effected as of the
open of business on the first business day immediately following the
date of the event giving rise to the conversion pursuant to this
Section B.4 (the "Class B Conversion Date"). From and after the Class B
Conversion Date, (i) the rights of the holder of the Shares for
Conversion in respect thereof will cease (other than the right to
receive any dividend or other distribution that has been declared by
the Board of Directors of the Corporation to be payable on or following
the Class B Conversion Date to holders of record of the class of Common
Stock of which the Shares for Conversion are a part on a date prior to
the Class B Conversion Date), (ii) the person or persons in whose name
or names the certificate or certificates for the shares to be issued
(the "Converted Shares") upon such conversion of the Shares for
Conversion shall be deemed to have become the holder or holders of
record of the Converted Shares represented thereby and (iii) any
certificate or certificates representing the Shares for Conversion
shall thereafter, and without any action on the part of holder thereof,
be deemed to represent the shares of Class A Common Stock into which
they are convertible.
c. Promptly after the Class B Conversion Date, the Corporation
will issue and deliver in accordance with the surrendering holder's
instructions the certificate or certificates for the Converted Shares
issuable upon conversion.
d. The Corporation will at all times reserve and keep
available out of its authorized but unissued shares of Class A Common
Stock, solely for the purpose of issuance upon the conversion of Class
B Common Stock as provided herein, the maximum number of shares as
shall then be issuable upon the conversion of all then outstanding
shares of Class B Common Stock.
e. If the Corporation in any manner subdivides or combines the
outstanding shares of Class A Common Stock or Class B Common Stock, the
outstanding shares of the other class will be proportionately
subdivided or combined.
f. The issuance of certificates representing Converted Shares
will be made without charge to the holders of such shares for any
issuance tax in respect thereof or other cost incurred by the
Corporation in connection with such conversion and issuance; provided
that the holder of such Converted Shares shall be responsible for any
transfer taxes due in connection with the conversion thereof. The
Corporation will not close its books against the transfer of its Common
Stock in any manner which would interfere with the timely conversion of
any class of Common Stock.
C. Preferred Stock. Subject to the limitations and modifications set
forth below, each share of Preferred Stock shall have the voting powers and the
designations, preferences, rights, qualifications, limitations and restrictions
of a share of Common Stock.
1. Voting Rights. Each holder of a share of Preferred Stock
shall have the same voting rights as the holder of a share of Common
Stock, and all holders of shares of Preferred Stock shall vote as a
single class with all holders of shares of Common Stock, and not as a
separate class, upon all matters in which the holders of the Common
Stock are entitled to vote.
2. Dividends. The holders of the shares of Preferred Stock
(together with the holders of any Common Stock) shall be entitled to
receive such dividends as may be declared from time to time by the
Board of Directors of the Corporation ratably in proportion to the
number of shares of Preferred Stock (and Common Stock) held by them.
3. Distributions. In the event of any Liquidation Event, the
holders of Preferred Stock shall be entitled to receive all of the
Available Assets ratably in proportion to the number of shares of
Preferred Stock held by them, in priority to any distribution to the
holders of Common Stock, until such holders of Preferred Stock receive
Payment in Full of the Preference Amount. If the Available Assets shall
be insufficient to distribute to the holders of shares of Preferred
Stock the Payment in Full of the Preference Amount to which they are
entitled, the holders of shares of Preferred Stock shall share ratably
in any distribution of Available Assets in proportion to the number of
shares of Preferred Stock held by them. After Payment in Full of the
Preference Amount to the holders of shares of Preferred Stock pursuant
to the foregoing provisions and to the holders of shares of Class A
Common Stock pursuant to Section A.3 and to the holders of shares of
Class B Common Stock pursuant to Section B.3 of this Article FOURTH,
the holders of Preferred Stock shall be entitled (together with the
holders of Common Stock) to receive any remaining Available Assets
ratably in proportion to the number of shares of Preferred Stock (and
Common Stock) held by them.
4. Exchange.
a. At any time and from time to time, the Corporation
may exchange, at the option of the Corporation in its sole
discretion, in whole or in part, the shares of Preferred
Stock, share for share, into shares of Class A Common Stock.
b. The Corporation may exercise the right to exchange
shares of Preferred Stock into shares of Class A Common Stock
by resolution of the Board of Directors to that effect (which
may specify an event or events upon which such exercise and
exchange will be effective).
c. On the date for the exchange of the shares of
Preferred Stock into shares of Class A Common Stock (the
"Exchange Date"), such shares of Preferred Stock (the
"Exchanged Shares") shall be exchanged, share for share, for
shares of Class A Common Stock. As a condition of receipt of
the certificate or certificates representing such Class A
Common Stock, each holder of Exchanged Shares must surrender
the certificate or certificates representing the Exchanged
Shares to the Corporation. Each surrendered certificate shall
be canceled and retired promptly after receipt by the
Corporation and the capital stock evidenced thereby may be
reissued by the Corporation.
d. From and after the Exchange Date, (i) the rights
of the holders of Exchanged Shares in respect thereof will
cease (other than the right to receive any dividend or other
distribution that has been declared by the Board of Directors
of the Corporation to be payable on or following the Exchange
Date to holders of record of Preferred Stock on a date prior
to the Exchange Date), (ii) the person or persons in whose
name or names the certificate or certificates for the
Exchanged Shares were issued shall be deemed to have become
the holder or holders of record of an equivalent number of
shares of Class A Common Stock and (iii) any certificate or
certificates representing Exchanged Shares shall thereafter,
and without any action on the part of the holder thereof, be
deemed to represent an equivalent number of shares of Class A
Common Stock.
e. If the Corporation in any manner subdivides or
combines the outstanding shares of Class A Common Stock or
Preferred Stock, the outstanding shares of the other class
will be proportionately subdivided or combined.
f. The Corporation shall at all times reserve and
keep available out of its authorized and unissued Class A
Common Stock, solely for the purpose of effecting the exchange
of the Preferred Stock, such number of shares of Class A
Common Stock as shall from time to time be sufficient to
effect the exchange of all then outstanding shares of
Preferred Stock. The Corporation shall from time to time,
subject to and in accordance with the laws of Delaware,
increase the authorized amount of Class A Common Stock if at
any time the number of authorized shares of Class A Common
Stock remaining unissued shall not be sufficient to permit the
exchange at such time of all then outstanding shares of
Preferred Stock.
5. Redemption.
a. At any time during the six-month period
immediately following the issuance of shares of Preferred
Stock by the Corporation and from time to time during such
period, the Corporation may redeem, at the option of the
Corporation in its sole discretion, in whole or in part, the
shares of Preferred Stock for a price of $20 per share without
interest thereon (the "Redemption Price").
b. The Corporation may exercise the right to redeem
shares of Preferred Stock by resolution of the Board of
Directors to that effect (which may specify an event or events
upon which such exercise and redemption will be effective).
c. On the date for the redemption of the shares of
Preferred Stock (the "Redemption Date"), the full Redemption
Price shall become payable in cash for the shares of Preferred
Stock being redeemed on such Redemption Date (the "Redeemed
Shares"). As a condition of payment of the Redemption Price,
each holder of Redeemed Shares must surrender the certificate
or certificates representing the Redeemed Shares to the
Corporation. Each surrendered certificate shall be canceled
and retired promptly after receipt by the Corporation and the
capital stock evidenced thereby may be reissued by the
Corporation.
d. On the Redemption Date, unless the Corporation
defaults in the payment in full of the Redemption Price, all
rights of holders of the Redeemed Shares shall terminate
(other than the right to receive any dividend or other
distribution that has been declared by the Board of Directors
of the Corporation to be payable on or following the
Redemption Date to holders of record of Preferred Stock on a
date prior to the Redemption Date and the right to receive the
Redemption Price).
e. If the Corporation in any manner subdivides or
combines the outstanding shares of Preferred Stock, the
Redemption Price will be adjusted proportionately.
D. Certain Definitions. For purposes of this Article FOURTH,
the following terms shall have the following meanings:
"Available Assets" means (i) in the case of a Business
Combination, all cash, securities and other assets to be received by
stockholders of the Corporation pursuant thereto and (ii) in the case
of any other Liquidation Event, all assets of the Corporation, tangible
and intangible, of whatever kind available for distribution to
stockholders.
"Business Combination" means any acquisition of the
Corporation by means of merger or other form of corporate
reorganization in which outstanding shares of the Corporation are
exchanged for cash, securities or other consideration issued or given,
or caused to be issued or given, by the acquiring corporation or its
subsidiary (other than a mere reincorporation transaction).
"Change of Control" shall mean an acquisition of all or
substantially all of the direct and indirect assets of the Company and
its subsidiaries (by merger, consolidation, stock or asset sale or
otherwise), whereby immediately following any such transaction (i) the
Lehman Fund and its affiliates own, in the aggregate less than 50% of
the Corporation's outstanding voting securities that the Lehman Fund
owned in the aggregate immediately following the consummation of the
transactions pursuant to the Purchase Agreement, dated as of March 2,
1998, by and between the Corporation and The Energy Group PLC
(excluding the anticipated sell down of approximately $75 million to
occur subsequent to such consummation) or (ii) any Person individually
owns more of the Corporation's then outstanding voting securities
entitled to vote generally than is owned in the aggregate by the Lehman
Fund and its affiliates.
"Initial Public Offering" shall mean the initial sale of
shares of any class of the Corporation's stock to the public pursuant
to an effective registration statement (other than a registration
statement on Form S-4 or S-8 or any similar or successor form) filed
under the Securities Act of 1933, as amended, which results in an
active trading market of the lesser of 25% of the outstanding shares of
the Corporation's Common Stock and a $250 million float in the
marketplace. There shall be deemed to be an "active trading market" if
the Corporation's Common Stock is listed or quoted on a national
exchange or the NASDAQ National Market.
"Lehman Fund" means Lehman Brothers Merchant Banking Partners
II L.P., Lehman Brothers Offshore Investment Partners II L.P., LB I
Group Inc., Lehman Brothers Capital Partners III, L.P., Lehman Brothers
Capital Partners IV, L.P. and Lehman Brothers MBG Partners 1998 (A)
L.P., collectively.
"Liquidation Event" means any of the following: (i) any
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, (ii) any Business Combination, or (iii) a sale or
disposition by the Corporation or any subsidiary of the Corporation, if
any, of all or substantially all of the assets of the Corporation or
such subsidiary (if, with respect to such subsidiary, the assets so
sold would have constituted all or substantially all of the assets of
the Corporation if the assets were held directly by the Corporation).
"Payment in Full of the Preference Amount" is deemed to have
been made at such time as the holders of the shares of Preferred Stock,
Class A Common Stock or Class B Common Stock, as the case may be, shall
have received in respect of each such share an aggregate amount of
cash, or securities or other assets, or any combination thereof, with a
fair market value equal to $20 in connection with a Liquidation Event
(without giving effect to prior unrelated dividends or distributions),
and in the event that the Corporation in any manner subdivides or
combines the outstanding shares of Class A Common Stock or Preferred
Stock, such Payment in Full of the Preference Amount shall be adjusted
accordingly.
"Person" means an individual, partnership, corporation,
business trust, joint stock company, limited liability company,
unincorporated association, joint venture or other entity of whatever
nature.
"Recapitalization Event" shall mean a recapitalization,
reorganization, stock dividend or other special corporate restructuring
which results in an extraordinary distribution to the stockholders of
cash and/or securities through the use of leveraging or otherwise but
which does not result in a Change of Control.
FIFTH: The Board of Directors of the Corporation, acting by
the affirmative vote of a majority of the directors then in office, may alter,
amend or repeal the Bylaws of the Corporation.
SIXTH: The number of directors of the Corporation shall be
determined in the manner provided in the Bylaws of the Corporation.
SEVENTH: Meetings of stockholders may be held within or
without the State of Delaware, as the Bylaws of the Corporation may provide. The
books of the Corporation may be kept outside the State of Delaware at such place
or places as may be designated by the Board of Directors or in the Bylaws of the
Corporation.
EIGHTH: Unless and except to the extent that the Bylaws of
the Corporation shall so require, the election of the directors of the
Corporation need not be by written ballot.
NINTH: Notwithstanding the provisions of Section 228 of the
General Corporation Law of the State of Delaware, the stockholders of the
Corporation may take action by written consent only if all of the stockholders
entitled to vote on the matter sign such consent. This Article NINTH may not be
amended without the unanimous consent of all stockholders entitled to vote on
the matter.
TENTH: To the fullest extent permitted by the laws of the
State of Delaware:
A. The Corporation shall indemnify any person (and such person's heirs,
executors or administrators) who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding
(brought in the right of the Corporation or otherwise), whether civil, criminal,
administrative or investigative, and whether formal or informal, including
appeals, by reason of the fact that such person is or was a director or officer
of the Corporation or, while a director or officer of the Corporation, is or was
serving at the request of the Corporation as a director, officer, partner,
trustee, employee or agent of another corporation, partnership, joint venture,
trust, limited liability company or other enterprise, for and against all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person or such heirs,
executors or administrators in connection with such action, suit or proceeding,
including appeals. Notwithstanding the preceding sentence, the Corporation shall
be required to indemnify a person described in such sentence in connection with
any action, suit or proceeding (or part thereof) commenced by such person only
if the commencement of such action, suit or proceeding (or part thereof) by such
person was authorized by the Board of Directors of the Corporation. The
Corporation may indemnify any person (and such person's heirs, executors or
administrators) who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding (brought in the
right of the Corporation or otherwise), whether civil, criminal, administrative
or investigative, and whether formal or informal, including appeals, by reason
of the fact that such person is or was an employee or agent of the Corporation
or is or was serving at the request of the Corporation as a director, officer,
partner, trustee, employee or agent of another corporation, partnership, joint
venture, trust, limited liability company or other enterprise, for and against
all expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person or such heirs,
executors or administrators in connection with such action, suit or proceeding,
including appeals.
B. The Corporation shall promptly pay expenses incurred by any person
described in the first sentence of Section A. of this Article TENTH in defending
any action, suit or proceeding in advance of the final disposition of such
action, suit or proceeding, including appeals, upon presentation of appropriate
documentation.
C. The Corporation may purchase and maintain insurance on behalf of any
person described in Section A. of this Article TENTH against any liability
asserted against such person, whether or not the Corporation would have the
power to indemnify such person against such liability under the provisions of
this Article TENTH or otherwise.
D. The provisions of this Article TENTH shall be applicable to all
actions, claims, suits or proceedings made or commenced after the adoption
hereof, whether arising from acts or omissions to act occurring before or after
its adoption. The provisions of this Article TENTH shall be deemed to be a
contract between the Corporation and each director or officer who serves in such
capacity at any time while this Article TENTH and the relevant provisions of the
laws of the State of Delaware and other applicable law, if any, are in effect,
and any repeal or modification hereof shall not affect any rights or obligations
then existing with respect to any state of facts or any action, suit or
proceeding then or theretofore existing, or any action, suit or proceeding
thereafter brought or threatened based in whole or in part on any such state of
facts. If any provision of this Article TENTH shall be found to be invalid or
limited in application by reason of any law or regulation, it shall not affect
the validity of the remaining provisions hereof. The rights of indemnification
provided in this Article TENTH shall neither be exclusive of, nor be deemed in
limitation of, any rights to which an officer, director, employee or agent may
otherwise be entitled or permitted by contract, this Second Amended and Restated
Certificate of Incorporation, vote of stockholders or directors or otherwise, or
as a matter of law, both as to actions in such person's official capacity and
actions in any other capacity while holding such office, it being the policy of
the Corporation that indemnification of any person whom the Corporation is
obligated to indemnify pursuant to the first sentence of Section A. of this
Article TENTH shall be made to the fullest extent permitted by law.
E. For purposes of this Article TENTH, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on a person with respect to an employee
benefit plan; and references to "serving at the request of the corporation"
shall include any service as a director, officer, employee or agent of the
Corporation which imposes duties on, or involves services by, such director,
officer, employee, or agent with respect to an employee benefit plan, its
participants, or beneficiaries.
ELEVENTH: A director of the Corporation shall not be liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except to the extent such exemption from liability or
limitation thereof is not permitted under the General Corporation Law of the
State of Delaware as the same exists or may hereafter be amended. Any amendment,
modification or repeal of the foregoing sentence shall not adversely affect any
right or protection of a director of the Corporation hereunder in respect of any
act or omission occurring prior to the time of such amendment, modification or
repeal.
4. In Lieu of a meeting and vote of the stockholders, the
stockholders have given written consent to such amendment and restatement of the
Amended and Restated Certificate of Incorporation of the Corporation in
accordance with the provisions of Section 228 of the General Corporation Law of
the State of Delaware.
IN WITNESS WHEREOF, the undersigned has executed this Second
Amended and Restated Certificate of Incorporation this 12th day of November
1998.
P&L COAL HOLDINGS CORPORATION
By: /s/ Irl F. Engelhardt
-----------------------------
Name: Irl F. Engelhardt
Title: Chairman and Chief
Executive Officer