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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 22, 1998
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TELEPHONE AND DATA SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-8251 36-2669023
- ---------------------------- ----------- ------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
30 North LaSalle Street, Chicago, Illinois 60602
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 630-1900
Not Applicable
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(Former name or former address, if changed since last report)
<PAGE>
Item 5. OTHER EVENTS.
On May 22, 1998, Telephone and Data Systems, Inc., an Iowa corporation
("TDS Iowa") merged with and into the Registrant, a wholly-owned subsidiary of
TDS Iowa, to effect a reincorporation into Delaware (the "Reincorporation").
The Registrant was the surviving corporation of this merger, and upon its
effectiveness, succeeded to and came to possess all of the assets, properties,
rights, privileges, powers, franchises, immunities and purposes, and became
subject to all the debts, liabilities, obligations, restrictions and duties of
TDS Iowa.
The Reincorporation did not result in any change in the Registrant's
business, assets or liabilities, did not cause Registrant's principal executive
offices to be moved and did not result in any relocation of management or other
employees. Pursuant to the Agreement and Plan of Merger between the Registrant
and TDS Iowa, on the effective date of the merger, (i) each share of TDS Iowa's
Preferred Shares, no par value, was automatically converted into one Preferred
Share, $.01 par value, of the Registrant of a corresponding series, (ii) each
share of TDS Iowa's Common Shares, $1.00 par value, was automatically converted
into one share of the Registrant's Common Shares, $.01 par value, and (iii) each
share of TDS Iowa's Series A Common Shares, $1.00 par value, was automatically
converted into one share of the Registrant's Series A Common Shares, $.01 par
value. Shareholders will not be required to undertake a mandatory exchange of
the Registrant's shares.
This description is a summary only and is qualified by reference in its
entirety to the documents filed.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
EXHIBITS
The exhibits accompanying this report are listed in the accompanying
Exhibit Index.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereto duly authorized.
TELEPHONE AND DATA SYSTEMS, INC.
(Registrant)
Date: May 22, 1998 By: /s/ GREGORY J. WILKINSON
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Gregory J. Wilkinson
Vice President and Controller
(principal accounting officer)
SIGNATURE PAGE TO TDS FORM 8-K DATED MAY 22, 1998
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EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
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2.1 Agreement and Plan of Merger, dated as of March 6, 1998,
between the Registrant and TDS Iowa, is hereby incorporated
by reference to Exhibit A to the Registrant's Prospectus
dated March 24, 1998, which is part of the Registrant's
Registration Statement on Form S-4 (Registration
No. 333-42535).
3.1 Restated Certificate of Incorporation of the Registrant, as
filed with the Secretary of State of the State of Delaware
on May 22, 1998 and currently in effect.
3.2 Restated Bylaws of the Registrant, as adopted on May 22,
1998 and currently in effect.
<PAGE>
EXHIBIT 3.1
RESTATED CERTIFICATE OF INCORPORATION
OF
TELEPHONE AND DATA SYSTEMS, INC.
Telephone and Data Systems, Inc., a corporation organized and existing
under and pursuant to the provisions of the General Corporation Law of the State
of Delaware (the "Corporation"), does hereby certify as follows:
FIRST: The original Certificate of Incorporation of the Corporation was
filed with the Secretary of State of the State of Delaware on December 12, 1997.
The Corporation hereby restates and integrates and further amends the
Certificate of Incorporation of the Corporation by revising such document in its
entirety as follows:
ARTICLE I
The name of the Corporation is Telephone and Data Systems, Inc.
ARTICLE II
The period of its duration is perpetual.
ARTICLE III
The Corporation shall have unlimited power to engage in, and to do any
lawful act concerning, any and all lawful business for which corporations may be
organized under the Delaware General Corporation Law above mentioned.
ARTICLE IV
A. AUTHORIZED SHARES.
1. Subject to paragraph 3 of this Section A and Section B.1, the
aggregate number of shares of capital stock which the Corporation is authorized
to issue is 475,000,000 shares, and the designation of each class or series, the
number of shares of each class or series and the par value of the shares of each
class or series, are as follows:
<TABLE>
<CAPTION>
Class Series No. of Shares Par Value
- ----- ------ ------------- ---------
<S> <C> <C> <C>
Common Shares None 100,000,000 $.01 per share
Series A Common Shares None 25,000,000 $.01 per share
Special Common Shares None 20,000,000 $.01 per share
United States Cellular Group
Common Shares None 140,000,000 $.01 per share
TDS Telecommunications Group
Common Shares None 90,000,000 $.01 par value
Aerial Communications Group
Common Shares None 95,000,000 $.01 par value
Undesignated Shares See Section B.1 4,720,599 $.01 par value
Preferred Shares See below 279,401 $.01 par value
</TABLE>
<PAGE>
THE FOLLOWING SERIES OF PREFERRED SHARES ORIGINALLY ISSUED BY TDS IOWA (AS
DEFINED IN SECTION B.19 OF THIS ARTICLE IV) BEFORE OCTOBER 31, 1981 ARE REFERRED
TO AS THE "PRE-81 PREFERRED SHARES."
<TABLE>
<CAPTION>
SERIES NO. OF SHARES
------ -------------
<S> <C>
A 1,395
B 1,955
D 646
G 1,368
H 1,188
N 2,347
</TABLE>
THE FOLLOWING SERIES OF PREFERRED SHARES ORIGINALLY ISSUED BY TDS IOWA AFTER
OCTOBER 31, 1981 ARE REFERRED TO AS THE "POST-81 PREFERRED SHARES."
<TABLE>
<CAPTION>
SERIES NO. OF SHARES
------ -------------
<S> <C>
O 629
S 1,209
U 1,100
BB 18,500
DD 42,540
EE 8,291
GG 26,919
II 3,746
JJ 1,310
KK 1,403
LL 1,487
QQ 8,368
SS 125,000
TT 30,000
</TABLE>
2. As of the effective date of this Restated Certificate of
Incorporation, the series of Preferred Shares set forth above shall have the
preferences, qualifications, limitations, restrictions and rights set forth in
this Restated Certificate of Incorporation, including Attachment I hereto, which
Attachment is incorporated herein and made a part hereof.
3. The number of authorized Common Shares, Series A Common Shares,
Special Common Shares, Cellular Group Common Shares, Telecom Group Common
Shares, Aerial Group Common Shares or Undesignated Shares may be increased or
decreased at any time or from time-to-time (but not below the number of such
shares then outstanding in such class, respectively) by the affirmative vote of
the holders of a majority of the voting power of shares of capital stock of the
Corporation entitled to vote on all matters (not including shares entitled to
vote only in the election of directors or as otherwise required by law,
including Section 242(b)(2) of the DGCL) pursuant to paragraph 8(c) of Section B
of this Article IV.
4. The Board shall have the authority to designate, prior to the time of
the first issuance of shares of any class or series of Tracking Stock (as
defined in Section B.19), the number of such shares which shall initially
constitute the number of shares which shall represent 100% of the common equity
of the related Tracking Group, the Number of Shares Issuable with Respect to
Retained Interest and the Number of Shares Issuable with Respect to Inter-Group
Interest, if any.
5. As of the first date of issuance of any class of Tracking Stock, the
outstanding series of Preferred Shares shall be attributed entirely to the TDS
Group. After the first date of issuance of any class of Tracking Stock, any
series of Undesignated Shares which are designated and issued, as preferred or
common stock, shall be attributed entirely to one Group or among two or more
Groups, as may be determined by the Board, taking into consideration the use of
proceeds from and purposes for such issuance and other factors.
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6. As of the first date of issuance of any class of Tracking Stock, all
Pre-Distribution Convertible Securities (as defined in Section B.19) shall be
attributed entirely to the TDS Group. After the first date of issuance of any
class of Tracking Stock, any Convertible Securities which are issued shall be
attributed entirely to one Group or among two or more Groups, as may be
determined by the Board, taking into consideration the use of proceeds from and
purposes for such issuance and other factors.
7. As of the first date of issuance of any class of Tracking Stock, any
Committed Acquisition Shares shall be attributed entirely to the TDS Group.
After the first date of issuance of any class of Tracking Stock, any Committed
Acquisition Shares shall be attributed entirely to one Group or among two or
more Groups, as may be determined by the Board, taking into consideration the
use of proceeds from and purposes for such issuance and other factors.
B. PREFERENCES, QUALIFICATIONS, LIMITATIONS, RESTRICTIONS AND RIGHTS OF
SHARES. The preferences, qualifications, limitations, restrictions, and the
special or relative rights of the Common, Series A Common, Special Common,
Cellular Group Common, Telecom Group Common, Aerial Group Common, Undesignated
and Preferred Shares are:
1. ISSUE OF UNDESIGNATED SHARES IN SERIES. Authority is hereby vested in
the Board to divide any or all of the Undesignated Shares into one or more
classes or series of common or preferred stock, and to further divide any of
those classes or series, and to fix and determine by resolution as to each class
or series so established:
(a) the designation of such class or series, the number of shares to
constitute such class or series and par value or stated value thereof;
(b) the rate of dividend and the terms thereof;
(c) the price at and terms and conditions by which shares may be
redeemed;
(d) the amount payable upon shares in event of voluntary or
involuntary liquidation;
(e) sinking fund provisions for the redemption or purchase of shares;
(f) the terms and conditions on which shares may be converted, if the
shares of any series are issued with the privilege of, or subject to
mandatory, conversion;
(g) voting rights, if any, but in no event more than ten votes per
share in connection with any matter; and
(h) such other designations, preferences and relative, participating,
optional or other special rights, and qualifications or restrictions
thereof, as shall be stated and expressed in a resolution or resolutions
providing for the issuance of such stock adopted by the Board. Any of the
voting powers, designations, preferences, rights and qualifications,
limitations or restrictions of any such class or series of stock may be
made dependent upon facts ascertainable outside this Restated Certificate
of Incorporation or of any amendment thereto, or outside the resolution or
resolutions providing for the issue of such stock adopted by the Board
pursuant to the foregoing authority vested in it by this Restated
Certificate of Incorporation, provided that the manner in which such facts
shall operate upon the voting powers, designations, preferences, rights and
qualifications, limitations or restrictions of such class or series is
clearly and expressly set forth in the resolution or resolutions providing
for the issue of such stock adopted by the Board. The term "facts" as used
in this paragraph includes, but is not limited to, the occurrence of any
event, including a determination or action by any person or body, including
the Corporation.
2. DIVIDENDS.
(a) Except as otherwise set forth in Attachment I hereto or as
otherwise provided in any designation of a class or series of Undesignated
Shares at the time that such class or series is originally established:
(i) the holders of Preferred Shares and of each class or series of
Undesignated Shares which has been designated as preferred stock shall be
entitled to receive, when and as declared by the Board, dividends at the
rate fixed for such
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series, and no more, payable in quarterly installments on the first days
of March, June, September and December in each year; (ii) dividends on all
series of Preferred Shares and all classes and series of Undesignated
Shares which have been designated as preferred stock shall be cumulative
from and after the respective dates of issuance; (iii) no dividends
shall be declared on the shares of any series of Preferred Shares or any
class or series of Undesignated Shares which have been designated as
preferred stock for any dividend period unless the full dividend for all
prior dividend periods shall have been declared or shall be declared at
the same time upon all Preferred Shares, and all classes and series of
Undesignated Shares which have been designated as preferred stock,
outstanding during such prior dividend periods; (iv) no dividends shall
be declared on the shares of any series of Preferred Shares, or any
class or series of Undesignated Shares which have been designated as
preferred stock, unless a dividend for the same period shall be declared
at the same time upon all series of Preferred Shares and all classes and
series of Undesignated Shares which have been designated as preferred
stock, outstanding during said period, in like proportion to the
dividend rate upon such shares; and (v) no dividends shall be paid on
any shares of Common Stock unless full dividends on all series of
Preferred Shares, and all classes and series of Undesignated Shares
which have been designated as preferred stock, for all past dividend
periods and for the current dividend period, shall have been declared
and the Corporation shall have paid such dividends or shall have set
apart a sum sufficient for the payment thereof.
(b) Dividends on any class or series of Common Stock may be declared
and paid only out of the lesser of (i) assets of the Company legally
available therefor and (ii) the Available Dividend Amount (as defined in
paragraph 19 of this Section B) with respect to such class or series.
Subject to the foregoing, the Board shall have the authority to declare and
pay dividends on all or less than all of the classes or series of Common
Stock in equal or unequal amounts, notwithstanding the amount of assets
available for dividends on any class or series, the respective voting and
liquidation rights of any class or series, the amount of prior dividends
declared on any class or series or any other factor; PROVIDED, HOWEVER,
that no dividends shall be declared or paid on the Series A Common Shares
unless the same, or greater, dividends, on a per share basis, are declared
and paid at the same time on the Common Shares and the Special Common
Shares, and if dividends shall be declared or paid on the Common Shares or
the Special Common Shares, the same dividends, on a per share basis, shall
be declared and paid at the same time on the Special Common Shares and the
Common Shares, respectively, except, in each case, as otherwise expressly
provided in this Restated Certificate of the Corporation.
3. SHARE DISTRIBUTIONS. Notwithstanding anything to the contrary herein,
if at any time a dividend or other distribution is to be paid in shares of
Common Stock on shares of Common Stock, such dividend or other distribution
shall be paid as only as follows (including, in each case, Convertible
Securities which are exercisable for or convertible or exchangeable into such
shares to be distributed):
(a) Common Shares may be distributed on an equal per share basis to
holders of Common Shares, Series A Common Shares may be distributed on an
equal per share basis to holders of Series A Common Shares, and Special
Common Shares may be distributed on an equal per share basis to holders of
Special Common Shares (if any are then outstanding);
(b) Common Shares may be distributed on an equal per share basis to
holders of Common Shares and Series A Common Shares, and Special Common
Shares may be distributed on an equal per share basis to holders of Special
Common Shares (if any are then outstanding);
(c) Series A Common Shares may be distributed on an equal per share
basis to holders of Common Shares and Series A Common Shares, and Special
Common Shares may be distributed on an equal per share basis to holders of
Special Common Shares (if any are then outstanding);
(d) Special Common Shares may be distributed on an equal per share
basis to holders of Common Shares, Series A Common Shares and Special
Common Shares (if any are then outstanding);
(e) shares of a class or series of Tracking Stock may be distributed
on an equal per share basis to holders of that class or series of Tracking
Stock;
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<PAGE>
(f) shares of a new class or series of capital stock which is
intended to represent a subdivision or new business of a Group, or any
assets attributed by the Board to such Group, may be distributed on an
equal per share basis to holders of common stock representing an interest
in such Group;
(g) shares of any class or series of Tracking Stock of a Tracking
Group may be distributed on an equal per share basis to holders of Common
Shares, Series A Common Shares and Special Common Shares (if any are then
outstanding), but only if the sum of (i) the number of shares of such class
or series of Tracking Stock to be so distributed (or the number of such
shares which would be issuable at such time upon the exercise, conversion
or exchange of any Convertible Securities to be so distributed) and
(ii) the Number of Shares Issuable to Third Parties related to such class
or series of Tracking Stock which are then are attributable to the TDS
Group, is less than or equal to the Number of Shares Issuable with Respect
to Retained Interest in such Tracking Group; and
(h) shares of any class or series of Tracking Stock of a Tracking
Group (for this purpose, the "Issuer Group"), may be distributed on an
equal per share basis to holders of a class or series of Tracking Stock of
any other Tracking Group (for this purpose, the "Investor Group"), but only
if the sum of (i) the number of shares of such class or series of Tracking
Stock of the Issuer Group to be so distributed (or the number of such
shares which would be issuable at such time upon the exercise, conversion
or exchange of any Convertible Securities to be so distributed) and
(ii) the Number of Shares Issuable to Third Parties related to the class or
series of Tracking Stock of the Issuer Group which are then are
attributable to the Investor Group, is less than or equal to the Number of
Shares Issuable with Respect to Inter-Group Interest in the Issuer Group by
the Investor Group.
In the case of any such share dividend the Board may permit the holders of
Common Stock to elect to receive cash in lieu of shares of stock. In any
dividend or distribution of Common Stock, the same number of shares of Common
Stock on a per share basis shall be distributed with respect to Common Shares,
Series A Common Shares and Special Common Shares.
4. DISTRIBUTION OF TDS GROUP SUBSIDIARY IN DIVIDEND. Subject to
paragraph 2(b) of Section B of Article IV, if at any time a distribution is to
be made of shares of capital stock of a subsidiary included in the TDS Group
(for this purpose, a "TDS Group Subsidiary"), such TDS Group Subsidiary shares
may only be distributed to the holders of Series A Common Shares, Common Shares
and any issued Special Common Shares and, in such event, the Board shall, to the
extent practicable, distribute TDS Group Subsidiary shares corresponding to
Series A Common Shares to the holders of Series A Common Shares, distribute TDS
Group Subsidiary shares corresponding to Common Shares to the holders of Common
Shares, and distribute TDS Group Subsidiary shares corresponding to Special
Common Shares to the holders of Special Common Shares, if any are then
outstanding; PROVIDED, HOWEVER, that the same number of shares of common stock
of the TDS Group Subsidiary must be distributed with respect to each Series A
Common Share, Common Share and any issued Special Common Share. If practicable,
the Board shall recapitalize such TDS Group Subsidiary through an amendment to
its charter or otherwise, such that the relative rights, limitations and
preferences of the shares of capital stock of such TDS Group Subsidiary
substantially correspond to the Series A Common Shares, Common Shares and
Special Common Shares of the Corporation and their relative rights, limitations
and preferences, as may be determined to be necessary or appropriate in the sole
discretion of the Board, in order to permit the distribution to be effected in
the foregoing manner; PROVIDED, HOWEVER, that if Special Common Shares are then
outstanding and the TDS Group Subsidiary has or will have shares corresponding
to Series A Common Shares and Common Shares but does not and will not have
shares corresponding to Special Common Shares and the Board determines that it
is impracticable to recapitalize the subsidiary as provided in this sentence to
create shares corresponding to Special Common Shares, the Board shall distribute
TDS Group Subsidiary shares corresponding to Common Shares of such TDS Group
Subsidiary to the holders of Special Common Shares.
5. DISTRIBUTION OF TRACKING GROUP SUBSIDIARY IN DIVIDEND. Subject to
paragraph 2(b) of Section B of Article IV, if at any time a distribution is
to be made of shares of capital stock of a subsidiary (for this purpose, a
Non-Qualifying Subsidiary") included in a Tracking Group (for this purpose,
the "Distributing Group"), other than a Qualifying Subsidiary or Qualifying
Subsidiaries holding all of the assets and liabilities of a Tracking Group,
and if there is a Retained Interest in such Distributing Group, the Board
shall, to the extent practicable, distribute Non-Qualifying Subsidiary shares
corresponding to Special Common Shares to the holders of Tracking Stock of
such Distributing Group equal to the product of the Outstanding Interest
Fraction multiplied by the number of all of the outstanding shares of the
Non-Qualifying Subsidiary owned directly or indirectly by the Corporation, on
a pro rata basis. The Board, in its sole discretion, may cause
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the Corporation to retain the balance of the outstanding shares of the common
stock of the Non-Qualifying Subsidiaries in respect of the Retained Interest
and any Inter-Group Interest in the Distributing Group or, in the sole
discretion of the Board, Non-Qualifying Subsidiary shares may be distributed
to the holders of TDS Group Shares or shares of any other Tracking Stock as
follows: (a) if the Board determines to distribute Non-Qualifying Subsidiary
shares to the holders of TDS Group Shares with respect to the Retained
Interest, it shall, to the extent practicable, distribute Non-Qualifying
Subsidiary shares corresponding to Series A Common Shares to the holders of
Series A Common Shares, subsidiary shares corresponding to Common Shares to
the holders of Common Shares, and subsidiary shares corresponding to Special
Common Shares to the holders of Special Common Shares with respect to any
Retained Interest in such Tracking Group, PROVIDED, that the same number of
shares of Non-Qualifying Subsidiary common stock must be distributed with
respect to each Series A Common Share, Common Share and any issued Special
Common Share and (b) if the Board determines to distribute Non-Qualifying
Subsidiary shares to the holders of any class or series of Tracking Stock of
a Tracking Group other than the Distributing Group with respect to any
Inter-Group Interest by such Tracking Group in the Distributing Group, it
must, to the extent practicable, distribute Non-Qualifying Subsidiary shares
corresponding to Special Common Shares to the holders of Tracking Stock of
such other Tracking Group with respect to any such Inter-Group Interest in
the Distributing Group. If practicable, the Board shall recapitalize such
Non-Qualifying Subsidiary through an amendment to its charter or otherwise,
such that the relative rights, limitations and preferences of the shares of
capital stock of the Non-Qualifying Subsidiary substantially correspond to
the Series A Common Shares, Common Shares and Special Common Shares of the
Corporation and their relative rights, limitations and preferences, as may be
determined to be necessary or appropriate in the sole discretion of the
Board, in order to permit the distribution to be effected in the foregoing
manner; PROVIDED, that if the Non-Qualifying Subsidiary has or will have
shares corresponding to Series A Common Shares and Common Shares but does not
have and will not have shares corresponding to Special Common Shares and the
Board determines that it is impracticable to recapitalize such subsidiary as
provided in this sentence to create shares corresponding to Special Common
Shares, the Board shall distribute Non-Qualifying Subsidiary shares
corresponding to Common Shares to the holders of Special Common Shares and to
holders of any class of Tracking Stock who would otherwise be entitled to
receive subsidiary shares corresponding to Special Common Shares.
6. CERTAIN PROVISIONS RELATING TO LIQUIDATION.
(a) Subject to paragraph 6(b) of this Section B, in the event of a
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, after payment or provision for payment of the
debts and other liabilities of the Corporation and subject to the prior
payment in full of the preferential amounts to which any class or series of
Preferred Shares or Undesignated Shares is entitled, the holders of the
outstanding shares of Common Stock shall be entitled to receive the
remaining assets of the Corporation, regardless of the Group to which such
assets are attributed in accordance with this Article IV, divided among the
holders of Common Stock in accordance with the per share "Liquidation
Units" attributable to each class of Common Stock. Each Series A Common
Share, Common Share and Special Common Share is hereby attributed one
Liquidation Unit, each Cellular Group Common Share is hereby attributed 2.5
Liquidation Units, each Telecom Group Common Share is hereby attributed .9
of a Liquidation Unit and each Aerial Group Common Share is hereby
attributed 1.1 Liquidation Units. The Liquidation Unit of each class or
series of Common Stock shall be adjusted by the Board as appropriate to
reflect equitably any subdivision (by stock split or otherwise) or
combination (by reverse stock split or otherwise) of such class of Common
Stock or any dividend or other distribution of shares or similar
transaction with respect to such class of Common Stock. Whenever a change
in the Liquidation Units with respect to any class or series of Common
Stock occurs, the Corporation shall prepare and file a statement of such
change with the Secretary of the Corporation and distribute a notice of
such change to all holders of shares of such class or series of Common
Stock, together with a notice of such stock split, reverse split,
distribution or other transaction requiring such change.
(b) Prior to the distribution of the remaining assets of the
Corporation as set forth in paragraph 6(a) of this Section B, the Board may
redeem all shares of Tracking Stock of all Tracking Groups in exchange for
shares of a Qualifying Subsidiary or Qualifying Subsidiaries holding all of
the assets and liabilities of the related Tracking Group pursuant to
paragraph 13 of this Section B.
(c) A consolidation, merger, or reorganization of the Corporation
with any other corporation or corporations, or a sale of all or
substantially all of the assets of the Corporation, shall not be considered
a dissolution, liquidation, or winding up of the Corporation within the
meaning of these provisions.
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7. PREEMPTIVE RIGHTS. No holder of shares of any class or series of the
Corporation shall have any preemptive right pursuant to this Restated
Certificate of Incorporation to subscribe for or acquire any unissued or
treasury shares or other securities of the Corporation of the same or any other
class or series, whether such shares or securities be hereby or hereafter
authorized, except that holders of Series A Common Shares shall have a
preemptive right to acquire unissued or treasury Series A Common Shares or
securities convertible into or exchangeable for Series A Common Shares or
carrying a right to subscribe to or acquire Series A Common Shares; PROVIDED,
HOWEVER, that no preemptive right shall exist to acquire any Series A Common
Shares sold otherwise than for cash.
8. VOTING.
(a) With respect to the election of directors, the holders of
(i) Pre-81 Preferred Shares, (ii) Common Shares, (iii) Special Common
Shares, (iv) shares of all classes or series of Tracking Stock and (v) any
series of Undesignated Shares which, at the time such series of
Undesignated Shares was originally established, provided that the holders
of such series shall vote in the election of directors together with the
holders of Pre-81 Preferred Shares, Common Shares, Special Common Shares
and shares of Tracking Stock (for this purpose, the "Public Holders"),
voting together as one group, shall be entitled to elect at each annual
meeting that number of directors which (together with all directors whose
terms do not expire at the time of such meeting and who were previously
elected by such holders) constitutes 25% of the total number of directors
of the Corporation (rounded up to the nearest whole number), plus one
director, and for this purpose the total number of directors of the
Corporation shall be determined without regard to any director(s) whom the
holders of one or more classes or series of Undesignated Shares have
elected or have the right to elect (without regard to this Section B.8),
and in such election each holder of Common Shares and Special Common Shares
shall be entitled to one vote for each share of such stock standing in the
name of the holder on the books of the Corporation, the holders of Tracking
Stock shall have the votes set forth in paragraph 8(d) of this Section B,
the holders of series of Pre-81 Preferred Shares shall have the voting
rights set forth on Attachment I hereto and the holders of any class or
series of Undesignated Shares shall have the voting rights fixed and
determined by the Board at the time such series of Undesignated Shares was
originally established.
(b) The holders of (i) Post-81 Preferred Shares, (ii) Series A Common
Shares and (iii) any class or series of Undesignated Shares which, at the
time such class or series of Undesignated Shares was originally
established, provided that the holders of such class or series shall vote
in the election of directors together with the holders of Post-81 Preferred
Shares and Series A Common Shares (for this purpose, the "Series A
Holders"), voting together as one group, shall be entitled to elect at each
annual meeting that number of directors which (together with all directors
whose terms do not expire at the time of such meeting and who were
previously elected by such holders) are not elected by the Public Holders,
as provided in paragraph 8(a) of this Section B, subject to the rights, if
any, of the holders of any class or series of Undesignated Shares to elect
one or more directors (without regard to this Section B.8), and in such
election each holder of Series A Common Shares shall be entitled to ten
votes for each share of such stock standing in the name of the holder on
the books of the Corporation, the holders of series of Post-81 Preferred
Shares shall have the voting rights set forth on Attachment I hereto and
the holders of any class or series of Undesignated Shares shall have the
voting rights fixed and determined by the Board at the time such class or
series of Undesignated Shares was originally established.
(c) With respect to all matters other than the election of directors,
each holder of a series of Pre-81 Preferred Shares or Post-81 Preferred
Shares shall have the voting rights set forth on Attachment I hereto, each
holder of Common Shares shall be entitled to one vote for each share of
such stock standing in the name of the holder on the books of the
Corporation, each holder of Series A Common Shares shall be entitled to ten
votes for each share of such stock standing in the name of the holder on
the books of the Corporation and the holders of any class or series of
Undesignated Shares shall have the voting rights fixed and determined by
the Board at the time such class or series of Undesignated Shares was
originally established. Neither the holders of Special Common Shares nor
the holders of shares of any class of Tracking Stock shall be entitled to
vote with respect to any matter other than the election of directors as set
forth in subparagraph (a) of this paragraph 8, unless such holders must
vote as required by the DGCL or other applicable law or regulation.
(d) Upon the first issuance of shares of any class or series of
Tracking Stock, each of such shares shall be entitled to one vote per share
in the election of directors elected by the Public Holders; PROVIDED,
HOWEVER,
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if shares of a class of Tracking Stock have been traded on a national
securities exchange or the Nasdaq Stock Market, or traded in the
over-the-counter market, for at least 25 Trading Days immediately prior
to any Adjustment Date (as hereinafter defined), the votes per share
which each share of a class of Tracking Stock shall have in the election
of directors at each annual meeting of shareholders pursuant to
paragraph 8(a) of this Section B shall be equal to the quotient
(calculated to three decimal places) determined by dividing the
Aggregate Votes (as hereinafter defined) of such class of Tracking Stock
on the Adjustment Date for such annual meeting, by the average daily
number of outstanding shares of such class of Tracking Stock during the
Calculation Period (as hereinafter defined) for such Adjustment Date.
The Aggregate Votes of a class of Tracking Stock on an Adjustment Date
shall be equal to the product of the Market Capitalization Percentage
(as hereinafter defined) of such class of Tracking Stock multiplied by
the Aggregate Public Holder Votes (as hereinafter defined) on the
Adjustment Date for such annual meeting. The Aggregate Public Holder
Votes shall be equal to the quotient (calculated to the nearest whole
number) determined by dividing the sum of the average daily number of
outstanding Pre-81 Preferred Shares, Common Shares and Special Common
Shares (the "One-Vote Shares") during the Calculation Period, by the
Market Capitalization Percentage of the One-Vote Shares. The Market
Capitalization Percentage of any class of Tracking Stock and of the
One-Vote Shares shall be equal to the average daily ratio (represented
as a percentage calculated to three decimal places) of the Market
Capitalization of such class of Tracking Stock or the aggregate Market
Capitalization of the One-Vote Shares, as the case may be, to the
aggregate Market Capitalization of all shares held by the Public
Holders, calculated for the twenty-Trading Day period (the "Calculation
Period") ending ten Trading Days prior to the record date for each
annual meeting of shareholders (the "Adjustment Date"). The number of
votes per share to which shares of classes of Tracking Stock shall be
entitled at any time in connection with the election or removal of
directors by the Public Holders shall be such number of votes per share
that were determined on the last preceding Adjustment Date relating to
an annual meeting of shareholders of the Corporation, and such number of
votes per share to which shares of Tracking Stock shall be entitled
shall not be changed until the next succeeding Adjustment Date for the
next succeeding annual meeting of shareholders of the Corporation.
(e) In the event the number of issued and outstanding Series A Common
Shares at any time falls below 500,000, then with respect to the election
of directors at the next annual meeting and at each annual meeting
thereafter, the holders of all outstanding Preferred Shares, Common Shares,
Series A Common Shares, Special Common Shares, Cellular Group Common
Shares, Telecom Group Common Shares and Aerial Group Common Shares, and any
class or series of Undesignated Shares which, at the time such class or
series of Undesignated Shares was originally established, provided that the
holders of such class or series shall vote in the election of directors
with the Public Holders or the Series A Holders, shall be entitled to elect
all of the directors of the Corporation standing for election at any
meeting of shareholders, subject to the rights, if any, of the holders of
one or more classes or series of Undesignated Shares to elect one or more
directors (without regard to this Section B.8), and in each such election
of directors each holder of Pre-81 Preferred Shares or Post-81 Preferred
Shares shall have the voting rights set forth on Attachment I hereto, each
holder of Common Shares and each holder of Special Common Shares shall be
entitled to one vote for each share of such stock standing in the name of
the holder on the books of the Corporation, each holder of Series A Common
Shares shall be entitled to ten votes for each share of such stock standing
in the name of the holder on the books of the Corporation, the holders of
Tracking Stock shall have the votes set forth in paragraph 8(f) of this
Section B and the holders of any class or series of Undesignated Shares
shall have the voting rights fixed and determined by the Board at the time
such class or series of Undesignated Shares was originally established.
(f) In the event the number of issued and outstanding Series A Common
Shares at any time falls below 500,000, the votes per share which each
share of a class of Tracking Stock shall have in the election of directors
at each annual meeting of shareholders shall be equal to the quotient
(calculated to three decimal places) determined by dividing the Adjusted
Aggregate Votes (as hereinafter defined) of such class of Tracking Stock on
the Adjustment Date for such annual meeting by the average daily number of
outstanding shares of such class of Tracking Stock during the Calculation
Period for such Adjustment Date. The Adjusted Aggregate Votes of a class of
Tracking Stock on an Adjustment Date shall be equal to the product of the
Adjusted Market Capitalization Percentage (as hereinafter defined) of such
class of Tracking Stock multiplied by the Aggregate Director Votes (as
hereinafter defined) on the Adjustment Date for such annual meeting. The
Aggregate Director Votes shall be equal to the quotient (calculated to the
nearest whole number) determined by dividing (i) the sum of (A) the average
daily number of One-Vote Shares and Post-81 Preferred Shares and (B) the
product of 10 and the average daily number of Series A Common Shares, in
each case during the Calculation Period, by (ii) the Aggregate Market
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Capitalization Percentage of the One-Vote Shares, Post-81 Preferred Shares
and the Series A Common Shares. The Aggregate Market Capitalization
Percentage of the One-Vote Shares, Post-81 Preferred Shares and the
Series A Common Shares shall be equal to the average daily ratio (expressed
as a percentage calculated to three decimal places) of the aggregate Market
Capitalization of the One-Vote Shares, the Post-81 Preferred Shares and the
Series A Common Shares to the aggregate Market Capitalization of all shares
of capital stock which are entitled to vote in the election of directors
pursuant to paragraph 8(e) of this Section B, calculated during the
Calculation Period ending on the Adjustment Date for an annual meeting. The
Adjusted Market Capitalization Percentage of any class of Tracking Stock
shall be equal to the average daily ratio (expressed as a percentage
calculated to three decimal places) of the Market Capitalization of such
class of Tracking Stock to the aggregate Market Capitalization of all
shares of capital stock which are entitled to vote in the election of
directors pursuant to paragraph 8(e) of this Section B, calculated during
the Calculation Period ending on the Adjustment Date for an annual meeting.
The number of votes per share to which shares of classes of Tracking Stock
shall be entitled at any time in connection with the election or removal of
directors shall be such number of votes per share that were determined on
the last preceding Adjustment Date relating to an annual meeting of
shareholders of the Corporation, and such number of votes per share to
which shares of Tracking Stock shall be entitled shall not be changed until
the next succeeding Adjustment Date for the next succeeding annual meeting
of shareholders of the Corporation.
9. CONVERSION AT THE OPTION OF THE HOLDER. Each outstanding Series A
Common Share shall be convertible into one Common Share or one Special Common
Share at any time at the holder's choice. Any such conversion shall be effected
by the presentation and surrender of the certificates representing the Series A
Common Shares to be converted at the office of the Corporation or at such other
place as may from time to time be designated by the Corporation, in such form
and accompanied by all transfer taxes (or proof of payment thereof), if any, as
shall be required for such transfer, and upon such surrender, the holder of such
stock shall be entitled to receive in exchange therefor certificates for fully
paid and non-assessable Common Shares or Special Common Shares, as the case may
be, of the Corporation at the rate aforesaid, and such holder shall be
registered as the holder of such Common Shares or Special Common Shares, as the
case may be.
10. DISPOSITION OF ASSETS OF A TRACKING GROUP.
(a) If the Corporation disposes of all or substantially all of the
properties and assets of a Tracking Group (defined as 80% or more of the
then current market-value (as determined by the Board) of the properties
and assets of such Tracking Group as of such date), whether by sale,
transfer, assignment, merger, consolidation, contribution of assets or
stock or otherwise (a "Disposition"), in one transaction or a series of
related transactions with any one or more persons, entities or groups,
other than in a transaction referred to in the following sentence, the
Corporation shall take one of the actions listed in paragraph 10(b) of this
Section B on or prior to the 90th Trading Day following the consummation of
a Disposition. This requirement shall not apply to a Disposition (i) in
connection with the disposition by the Corporation of all of the
Corporation's properties and assets in one transaction or a series of
related transactions or in connection with the liquidation, dissolution or
winding up of the Corporation, (ii) by dividend, other distribution or
redemption in accordance with any provision described under paragraphs 2,
3, 4, 5, 6 or 13 of this Section B, (iii) to any person, entity or group
which the Corporation, directly or indirectly, after giving effect to the
Disposition, controls (as determined by the Board) or (iv) in connection
with a Related Business Transaction. For purposes of this paragraph 10, the
Tracking Group affected by the Disposition of its assets is referred to as
the "Affected Tracking Group" and the Tracking Stock of such Affected
Tracking Group is referred to as the "Affected Tracking Stock."
(b) Other than as described in paragraph (a), the Corporation shall
take one of the following actions in the event of a Disposition:
(i) subject to paragraph 2(b) of this Section B, declare and
distribute a special dividend in cash, securities or other property
(other than a dividend or distribution of Common Stock of the
Corporation) or any combination thereof to the holders of the
outstanding shares of the Affected Tracking Stock, in an aggregate
amount equal to the product of the Outstanding Interest Fraction of
the Affected Tracking Group as of the record date for determining the
holders entitled to receive such dividend and the Fair Value of the
Net Proceeds of such Disposition, such dividend to be distributed
equally on a share-for-share basis to all outstanding shares of the
Affected Tracking Stock, except as provided in paragraph 2(d) of this
Section B;
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(ii) provided that there are assets of the Corporation legally
available therefor and the Available Dividend Amount for the Affected
Tracking Stock would have been sufficient to pay a dividend in lieu
thereof as described in subparagraph (i) of this paragraph, then:
(A) if such Disposition involves all (not merely
substantially all) of the properties and assets of the Affected
Tracking Group, redeem all outstanding shares of the Affected
Tracking Stock in exchange for cash, securities or other property
(other than Common Stock of the Corporation) or any combination
thereof on a pro rata basis in an aggregate amount equal to the
product of the Adjusted Outstanding Interest Fraction for the
Affected Tracking Group as of the date of such complete
redemption and the Fair Value of the Net Proceeds of such
Disposition, such aggregate amount to be allocated on a pro rata
basis to all outstanding shares of the Affected Tracking Stock,
except as provided in paragraph 2(d) of this Section B; or
(B) if such Disposition involves substantially all (but not
all) of the properties and assets of the Affected Tracking Group,
apply an aggregate amount of cash, securities or other property
(other than Common Stock of the Corporation) or any combination
thereof equal to the product of the Affected Tracking Group's
Outstanding Interest Fraction as of the date shares are selected
for redemption and the Fair Value of the Net Proceeds of such
Disposition to the redemption of outstanding shares of the
Affected Tracking Stock, such aggregate amount to be allocated on
a pro rata basis or by lot (except as provided in paragraph
2(d) of this Section B) to the shares of the Affected Tracking
Stock to be redeemed in a manner such that there shall be
redeemed the number of whole shares of Affected Tracking Stock
which have in the aggregate an average Market Value during the
forty-Trading Day period beginning on the 11th Trading Day
following the consummation of the Disposition closest to the
product of the Outstanding Interest Fraction as of the date such
shares are selected for redemption multiplied by the Fair Value
of the Net Proceeds of such Disposition (but in no event more
than all of the shares of Affected Tracking Stock then
outstanding); or
(iii) convert each outstanding share of the Affected Tracking
Stock of the Affected Tracking Group into a number (or fraction) of
fully paid and non-assessable Special Common Shares or shares of any
other class or classes of Tracking Stock (or any combination thereof
on a pro rata basis) equal to 110% (the "Disposition Conversion
Percentage") of the average daily ratio (calculated to the nearest
five decimal places) of the Market Value of (y) one share of Affected
Tracking Stock to (z) the Market Value of one Special Common Share or
share of such other class or classes of Tracking Stock (or any
combination thereof on a pro rata basis) during a forty-Trading Day
period beginning on the 11th Trading Day after consummation of the
Disposition.
In the event of the conversion of the Affected Tracking Stock
into Special Common Shares or shares of another class or classes of
Tracking Stock, the Fair Value of the Net Proceeds of such Disposition
shall be attributed to the Group related to the shares which are
issued upon such conversion (on a pro rata basis if a combination of
such shares are issued).
(c) The Corporation may elect to pay the dividend or redemption price
referred to in subparagraph (i) or (ii) of paragraph 10(b) of this
Section B either in the same form as the proceeds of the Disposition were
received or in any other combination of cash or securities or property
(other than Common Stock of the Corporation) that the Board determines will
have an aggregate market value on a fully distributed basis of not less
than the amount equal to:
(i) in the case of subparagraph (i) or clause (B) of
subparagraph (ii) of this paragraph 10(b), the product of the
applicable Outstanding Interest Fraction and the Fair Value of the Net
Proceeds of such Disposition; or
(ii) in the case of clause (A) of subparagraph (ii) of this
paragraph 10(b), the product of the applicable Adjusted Outstanding
Interest Fraction and the Fair Value of the Net Proceeds of such
Disposition.
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(d) If the dividend or redemption referred to in paragraph 10(b) of
Section B is paid in securities of an issuer other than the Corporation
(the "Successor"), and if there is a Retained Interest in the Affected
Tracking Group at such time, the Board shall, to the extent practicable,
distribute Successor shares corresponding to Special Common Shares to the
holders of shares of the Affected Tracking Stock. In the event of a
Disposition, the Corporation shall not be required to make any payment or
other distributions to the holders of TDS Group Shares or shares of any
class of Tracking Stock other than the Affected Tracking Stock. The
Successor shares relating to any Retained Interest or Inter-Group Interest
at the time of the Disposition may be retained by the Corporation and
attributed to the TDS Group or the other Tracking Group, respectively, or
some or all of such shares may be distributed pro rata to the holders of
the TDS Group Shares or the applicable Tracking Stock, respectively, in the
sole discretion of the Board. If the Board determines to distribute
Successor shares with respect to such a Retained Interest or Inter-Group
Interest, it shall, to the extent practicable, distribute Successor shares
corresponding to Special Common Shares to the holders of Tracking Stock of
another Tracking Group with respect to any such Inter-Group Interest, and
distribute Successor shares corresponding to Series A Common Shares to the
holders of Series A Common Shares, Successor shares corresponding to Common
Shares to the holders of Common Shares, and Successor shares corresponding
to Special Common Shares to the holders of Special Common Shares with
respect to any Retained Interest in such Tracking Group; PROVIDED that the
same number of shares of Successor common stock on a combined basis must be
distributed for each Series A Common Share, Common Share and any issued
Special Common Share. If practicable, the Board shall cause such Successor
to be recapitalized through an amendment to its charter or otherwise, such
that the shares of capital stock of such Successor and the relative rights,
limitations and preferences thereof substantially correspond to the
Series A Common Shares, Common Shares and Special Common Shares of the
Corporation and their relative rights, limitations and preferences, as may
be determined to be necessary or appropriate in the sole discretion of the
Board, in order to permit the distribution to be effected in the foregoing
manner.
(e) Subject to the terms of paragraph 10(b) of this Section B, the
Board shall have complete discretion as to which option in paragraph
10(b) to select; PROVIDED, HOWEVER, that once the disposition option
selected by the Board is publicly announced pursuant to paragraph 11 of
this Section B, the selection shall be irrevocable. The Board shall not be
required to select the option which results in the distribution with the
highest value to the holders of the shares of the Affected Tracking Stock
or with the smallest effect on the remaining classes and series of the
Corporation's Common Stock. In the event of a Disposition, the Corporation
shall not be required to make any payment or other distributions to the
holders of Common Shares, Series A Common Shares, Special Common Shares or
shares of any class of Tracking Stock other than the Affected Tracking
Stock; PROVIDED, HOWEVER, the Corporation may, in the sole discretion of
the Board, make a distribution to such other shareholders in respect of any
Retained Interest or any Inter-Group Interest in the Affected Tracking
Group existing at the time of a Disposition; PROVIDED FURTHER, that if the
dividend or redemption referred to in paragraph 10(b) of this Section B is
paid in securities of a Successor, and if there is a Retained Interest in
the Affected Tracking Group at such time, the Board shall make any such
distribution in the manner provided pursuant to paragraph 10(d) of this
Section B.
(f) The Corporation may, in the sole discretion of the Board, at any
time prior to the first anniversary of a dividend on, or partial redemption
of, shares of Affected Tracking Stock following a Disposition, convert each
remaining outstanding share of Affected Tracking Stock into a number (or
fraction) of Special Common Shares or shares of any other class or classes
of Tracking Stock (or combination thereof on a pro rata basis) equal to the
product of the Disposition Conversion Percentage and the average daily
ratio (calculated to the nearest five decimal places) of the Market Value
of one Special Common Share or share of such other class or classes of
Tracking Stock (or any combination thereof on a pro rata basis) during a
twenty-Trading Day period ending on the fifth Trading Day prior to the date
of notice of such conversion.
(g) To the extent that any Shares Issuable to Third Parties are
included in the determination of the Adjusted Outstanding Interest
Fraction, the Corporation's obligations in respect of such securities shall
not be a reduction in the calculation of the Fair Value of the Net
Proceeds. In the event any redemption of Tracking Stock is made in
circumstances in which cash, securities or property are allocated to the
TDS Group in respect of Shares Issuable to Third Parties (such cash,
securities or other property being referred to herein as the "Reserved
Property"), the Corporation shall be permitted to segregate and hold such
property separate (in the case of any Reserved Property other than Special
Common Shares or shares of another class of Tracking Stock). In the event
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the Reserved Property is, for any reason, not delivered with respect to the
obligations relating to such Shares Issuable to Third Parties, such
Reserved Property shall revert to the TDS Group, subject to escheat laws,
and the former holders of the Affected Tracking Stock shall have no
interest in such Reserved Property. In the event of any conversion of
Tracking Stock into Special Common Shares or shares of any other class or
classes of Tracking Stock, the Corporation shall duly reserve Special
Common Shares or shares of such other class or classes of Tracking Stock or
combination thereof issuable with respect to Shares Issuable to Third
Parties of the Affected Tracking Stock.
(h) At the time of any dividend made as a result of a Disposition,
the TDS Group shall be credited, and the Affected Tracking Group shall be
charged (in addition to the charge for the dividend paid in respect of
outstanding shares of Affected Tracking Stock), with an amount equal to the
product of (i) the aggregate amount paid in respect of such dividend times
(ii) a fraction the numerator of which is the Retained Interest Fraction
and the denominator of which is the Outstanding Interest Fraction of such
Tracking Group.
(i) If any Inter-Group Interests in a Tracking Group exists at the
time of any dividend made as a result of a Disposition, each Tracking Group
holding such an Inter-Group Interest in the Affected Tracking Group shall
be credited, and the Affected Tracking Group shall be charged (in addition
to the charge for the dividend paid in respect of outstanding shares of
Affected Tracking Stock) with an amount equal to the product of (i) the
aggregate amount paid in respect of such dividend times (ii) a fraction the
numerator of which is the Inter-Group Interest Fraction and the denominator
of which is the Outstanding Interest Fraction of the Affected Tracking
Group.
(j) In the case of a Disposition in a series of related transactions,
the Disposition shall be deemed to have been consummated upon the
consummation of the last of the series of related transactions.
(k) The Board shall determine the redemption date or conversion date
pursuant to Section B.11 hereof.
11. PROCEDURES RELATING TO DISPOSITION RIGHTS.
(a) Not later than the fifth Trading Day following the consummation
of a Disposition referred to above, the Corporation shall announce publicly
by press release (i) the Fair Value of the Net Proceeds of such
Disposition, (ii) the number of outstanding shares of Affected Tracking
Stock, (iii) information describing and indicating the number of Shares
Issuable to Third Parties of the Affected Tracking Stock, including the
number of such shares which are issuable as Committed Acquisition Shares
and the number of such shares into or for which Convertible Securities are
then convertible, exercisable or exchangeable, and the conversion, exercise
or exchange prices thereof (and stating which, if any, of such Convertible
Securities are Pre-Distribution Convertible Securities), (iv) the
Disposition Conversion Percentage, (v) the Outstanding Interest Fraction
for the Affected Tracking Stock as of a recent date preceding the date of
such notice and (vi) the Adjusted Outstanding Interest Fraction for the
Affected Tracking Stock as of a recent date preceding the date of such
notice. Not earlier than the 51st Trading Day and not later than the 55th
Trading Day following the consummation of such Disposition, the Corporation
shall announce publicly by press release which of the redemption options
thereof described in paragraph 10(b) of this Section B it has irrevocably
determined to take and the kind of capital stock or cash, securities or
other property or combination thereof to be delivered pursuant to the
option selected.
(b) If the Corporation determines to pay a dividend of cash,
securities or other property or combination thereof following a
Disposition, as described in subparagraph (i) of paragraph 10(b) of Section
B, the Corporation shall, not earlier than the 51st Trading Day and not
later than the 55th Trading Day following the consummation of such
Disposition, cause to be sent to each holder of outstanding shares of the
Affected Tracking Stock a notice setting forth (i) the record date for
determining holders entitled to receive such dividend, which shall be not
earlier than the 61st Trading Day and not later than the 65th Trading Day
following the consummation of such Disposition, (ii) the anticipated
payment date of such dividend (which shall not be more than 90 Trading Days
following the consummation of such Disposition), (iii) the kind and amount
of cash, other securities or property or combination thereof to be
distributed in respect of each share of the Affected Tracking Stock,
(iv) the amount of the Fair Value of the Net Proceeds of such Disposition,
(v) the Outstanding Interest Fraction as of a recent date preceding the
date of such notice, and (vi) the number of outstanding shares of the
Affected Tracking Stock subject
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to the Disposition and the Number of Shares Issuable to Third Parties of
the Affected Tracking Stock, including the number of such shares which
are issuable as Committed Acquisition Shares and the number of shares of
the Affected Tracking Stock into or for which outstanding Convertible
Securities are then convertible, exercisable or exchangeable and the
conversion, exercise or exchange prices thereof (and stating which, if
any, are Pre-Distribution Convertible Securities).
(c) If the Corporation determines to undertake a redemption of a
class of Tracking Stock following a Disposition of all (not merely
substantially all) of the properties and assets of the Affected Tracking
Group with respect to the Fair Value of the Net Proceeds, as described in
clause (A) of subparagraph (ii) of paragraph 10(b) of this Section B, the
Corporation shall cause to be given to each holder of outstanding shares of
Tracking Stock of the Affected Tracking Group a notice setting forth (i) a
statement that all of the shares of the Affected Tracking Stock outstanding
on the redemption date shall be redeemed, (ii) the anticipated redemption
date (which shall not be more than 90 Trading Days following the
consummation of such Disposition), (iii) the kind and amount of cash,
securities or property or combination thereof to be paid as a redemption
price in respect of shares of the Affected Tracking Stock outstanding on
the redemption date, (iv) the amount of the Fair Value of the Net Proceeds
of such Disposition, (v) the Adjusted Outstanding Interest Fraction as of a
recent date preceding the date of such notice, (vi) the place or places
where certificates for shares of Affected Tracking Stock, properly endorsed
or assigned for transfer (unless the Corporation waives such requirement),
are to be surrendered for delivery of cash, securities or property, and
(vii) the number of outstanding shares of the Affected Tracking Stock and
the Number of Shares Issuable to Third Parties of the Affected Tracking
Stock, including the number of such shares which are issuable as Committed
Acquisition Shares and the number of shares of the Affected Tracking Stock
into or for which outstanding Convertible Securities are then convertible,
exercisable or exchangeable and the conversion, exercise or exchange prices
thereof (and stating which, if any, of such Convertible Securities are
Pre-Distribution Convertible Securities). Such notice shall be sent not
less than 51 Trading Days nor more than 55 Trading Days following the
consummation of such Disposition and not less than 25 Trading Days prior to
the redemption date.
(d) If the Corporation determines to undertake a partial redemption
of Tracking Stock following a Disposition of substantially all (but not
all) of the properties and assets of the Affected Tracking Group as
described in clause (B) of subparagraph (ii) of paragraph 10(b) of this
Section B, such partial redemption shall be done on a pro rata basis or by
lot. The Corporation shall, not earlier than the 51st Trading Day and not
later than the 55th Trading Day following the consummation of such a
Disposition, cause to be given to each holder of record of outstanding
shares of the Affected Tracking Stock a notice setting forth (i) a
statement that some of the shares of the Affected Tracking Stock
outstanding on the redemption date shall be redeemed, specifying the number
of such shares or how such number shall be determined, (ii) a date not
earlier than the 61st Trading Day and not later than the 65th Trading Day
following the consummation of such Disposition which shall be the date on
which shares of the Affected Tracking Stock then outstanding shall be
selected for redemption, (iii) the anticipated redemption date (which shall
not be more than 90 Trading Days following the consummation of such
Disposition), (iv) the kind and amount of cash, securities or property or
combination thereof to be paid as a redemption price in respect of the
shares of the Affected Tracking Stock, (v) the amount of the Fair Value of
the Net Proceeds of such Disposition, (vi) the Outstanding Interest
Fraction as of a recent date preceding the date of such notice, (vii) the
Number of Shares Issuable to Third Parties of the Affected Tracking Stock,
including the number of such shares which are issuable as Committed
Acquisition Shares and the number of shares of Affected Tracking Stock into
or for which outstanding Convertible Securities are then convertible,
exercisable or exchangeable and the conversion, exercise or exchange prices
thereof (and stating which, if any, of such Convertible Securities are
Pre-Distribution Convertible Securities), and (viii) a statement that the
Corporation shall not be required to register a transfer of any shares of
the Affected Tracking Stock for a period of up to 15 Trading Days next
preceding the date referred to in clause (ii) of this sentence. Promptly
following the date referred to in clause (ii) of the preceding sentence,
but not earlier than the 61st Trading Day and not later than the 65th
Trading Day following the consummation of such Disposition, the Corporation
shall cause to be given to each holder of shares of the Affected Tracking
Stock, a notice setting forth (i) the number of shares of Affected Tracking
Stock held by such holder to be redeemed, (ii) a statement that such shares
of Affected Tracking Stock shall be redeemed, (iii) the anticipated
redemption date (which shall not be more than 90 Trading Days following the
consummation of such Disposition), (iv) the kind and amount of cash, other
securities or property to be received by such holder with respect to each
share of Affected Tracking Stock to be redeemed, including details as to
the calculation thereof, and (v) the place or places where certificates for
such shares of Affected Tracking Stock, properly endorsed or assigned for
transfer (unless the
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Corporation waives such requirement), are to be surrendered for delivery
of such cash, other securities or property or combination thereof.
(e) In the event of any conversion following a Disposition, as
described in subparagraph (iii) of paragraph 10(b) of this Section B, the
Corporation shall cause to be given to each holder of outstanding shares of
the Affected Tracking Stock a notice setting forth (i) a statement that all
of the outstanding shares of the Affected Tracking Stock shall be converted
into a number or fraction of Special Common Shares or shares of any other
class of Tracking Stock or combination thereof on a pro rata basis, and the
calculation pursuant to which such number or fraction was determined or
will be determined, (ii) the anticipated conversion date (which shall not
be more than 90 Trading Days following the consummation of such
Disposition), (iii) the per share number (or fraction) of Special Common
Shares or shares of another class of Tracking Stock or combination thereof,
as applicable, to be received with respect to each share of Affected
Tracking Stock, specifying such number or fraction of shares or combination
thereof, the Disposition Conversion Percentage and other details as to the
calculation thereof, (iv) the place or places where certificates for shares
of the Affected Tracking Stock, properly endorsed or assigned for transfer
(unless the Corporation waives such requirement), are to be surrendered,
and (v) the number of outstanding shares of the Affected Tracking Stock and
the Number of Shares Issuable to Third Parties of the Affected Tracking
Stock, including the number of such shares which are issuable as Committed
Acquisition Shares and the number of shares of the Affected Tracking Stock
into or for which outstanding Convertible Securities are then convertible,
exercisable or exchangeable and the conversion, exercise or exchange prices
thereof (and stating which, if any, are Pre-Distribution Convertible
Securities). Such notice shall be sent not less than 51 Trading Days nor
more than 55 Trading Days following the consummation of the Disposition and
not less than 25 days prior to the conversion date.
(f) Upon the Corporation's decision to convert all of the remaining
outstanding shares of the Affected Tracking Stock as described in paragraph
10(f), the Corporation shall announce publicly by press release (i) the
number of outstanding shares of Affected Tracking Stock to be converted,
(ii) the Number of Shares Issuable to Third Parties of such Tracking Stock,
including the number of such shares which are issuable as Committed
Acquisition Shares and into or for which Convertible Securities are then
convertible, exercisable or exchangeable and the conversion, exercise or
exchange prices thereof (and stating which, if any, of such Convertible
Securities are Pre-Distribution Convertible Securities), (iii) the
Disposition Conversion Percentage and (iv) the Outstanding Interest
Fraction for such Tracking Stock as of a recent date preceding the date of
such notice. The Corporation shall subsequently announce publicly by press
release whether the shares of such Tracking Stock are being converted in
exchange for Special Common Shares, shares of another Tracking Stock or a
combination thereof on a pro rata basis.
(g) In the event of any conversion as described paragraph 10(f) of
this Section B, the Corporation shall cause to be given to each holder of
outstanding shares of the Affected Tracking Stock a notice setting forth
(i) a statement that all of the outstanding shares of the Affected Tracking
Stock shall be converted into a number or fraction of Special Common Shares
or shares of any other class of Tracking Stock or combination thereof on a
pro rata basis, specifying the shares or combination thereof, (ii) the
anticipated conversion date (which shall not be more than 90 Trading Days
following the press release that publicly announces such conversion),
(iii) the per share number (or fraction) of Special Common Shares or shares
of another class of Tracking Stock or combination thereof, as applicable,
to be received with respect to each share of Affected Tracking Stock,
specifying such number or fraction of shares or combination thereof, the
Disposition Conversion Percentage and other details as to the calculation
thereof, (iv) the place or places where certificates for shares of the
Affected Tracking Stock, properly endorsed or assigned for transfer (unless
the Corporation waives such requirement), are to be surrendered, and
(v) the number of outstanding shares of the Affected Tracking Stock and the
Number of Shares Issuable to Third Parties of the Affected Tracking Stock,
including the number of such shares which are issuable as Committed
Acquisition Shares and the number of shares of the Affected Tracking Stock
into or for which outstanding Convertible Securities are then convertible,
exercisable or exchangeable and the conversion, exercise or exchange prices
thereof (and stating which, if any, are Pre-Distribution Convertible
Securities). Such notice shall be sent not less than 25 Trading Days nor
more than 35 Trading Days prior to the conversion date.
12. CONVERSION AT OPTION OF THE CORPORATION. The Corporation may, in the
sole discretion of the Board, at any time convert each outstanding share of any
class of Tracking Stock (the "Converted Tracking Stock") of any Tracking
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Group (the "Converted Tracking Group") into a number (or fraction) of fully
paid and non-assessable Special Common Shares or shares of another class or
classes of Tracking Stock or any combination thereof on a pro rata basis,
equal to the product of the applicable percentage set forth below (the
"Optional Conversion Percentage") on a conversion date selected by the Board
pursuant to Section B.14 hereof, and the average daily ratio (calculated to
the nearest five decimal places) of the Market Value of one share of
Converted Tracking Stock to the Market Value of one Special Common Share or
share of such other class of Tracking Stock or any combination thereof on a
pro rata basis, during a twenty-Trading Day period ending on the fifth
Trading Day prior to the date of notice of such conversion, on a pro rata
basis:
<TABLE>
<CAPTION>
12-MONTH PERIOD PRIOR TO OPTIONAL CONVERSION
ANNIVERSARY OF INITIAL ISSUANCE DATE PERCENTAGE
------------------------------------ -------------------
<S> <C>
First through Fifth. . . . . . . . . . . . . . . . . . 115%
Sixth. . . . . . . . . . . . . . . . . . . . . . . . . 114%
Seventh. . . . . . . . . . . . . . . . . . . . . . . . 113%
Eighth . . . . . . . . . . . . . . . . . . . . . . . . 112%
Ninth. . . . . . . . . . . . . . . . . . . . . . . . . 111%
Thereafter . . . . . . . . . . . . . . . . . . . . . . 110%
</TABLE>
In the event of the conversion of any class of Tracking Stock into Special
Common Shares or shares of another class or classes of Tracking Stock, the
assets and liabilities of the Converted Tracking Group shall be attributed to
the Group related to the shares which are issued upon such conversion (on a pro
rata basis if a combination of such shares are issued).
13. REDEMPTION IN EXCHANGE FOR STOCK OF SUBSIDIARY.
(a) Subject to paragraph 2(b) of this Section B, the Corporation, in
the sole discretion of the Board, may at any time redeem (at no premium)
all of the outstanding shares of any class of Tracking Stock (the "Redeemed
Tracking Stock") of a Tracking Group (the "Redeemed Tracking Group"), for a
number of outstanding shares of common stock of a Qualifying Subsidiary or
Qualifying Subsidiaries holding all of the assets and liabilities
attributed to the Redeemed Tracking Group equal to the product of the
Adjusted Outstanding Interest Fraction of the Redeemed Tracking Group
multiplied by the number of all of the outstanding shares of the Qualifying
Subsidiaries owned directly or indirectly by the Corporation, on a pro rata
basis. The Corporation shall retain the balance of the outstanding shares
of the common stock of the Qualifying Subsidiaries as (i) Reserved Property
with respect to the obligations related to the Number of Shares Issuable to
Third Parties used in calculating such Adjusted Outstanding Interest
Fraction, or (ii) in respect of the Retained Interest and any Inter-Group
Interest in the Converted Tracking Group; PROVIDED, HOWEVER, in the sole
discretion of the Board, shares of common stock of the Qualifying
Subsidiaries retained in respect of the Retained Interest and any
Inter-Group Interest in such Tracking Group may be distributed as provided
in paragraph 13(b) of this Section B.
(b) In the event the Board determines to redeem the shares of any
class of Tracking Stock for shares of a Qualifying Subsidiary, and if there
is a Retained Interest in such Tracking Group, the Board shall, to the
extent practicable, distribute Qualifying Subsidiary shares corresponding
to Special Common Shares to the holders of Tracking Stock of such Tracking
Group with respect to the Adjusted Outstanding Interest Fraction in such
Tracking Group and, if the Board determines to distribute shares of such
Qualifying Subsidiary to other shareholders with respect to any Retained
Interest or Inter-Group Interest shall, to the extent practicable,
distribute Qualifying Subsidiary shares corresponding to Special Common
Shares to the holders of any other Tracking Stock with respect to any such
Inter-Group Interest in such Tracking Group, and distribute Qualifying
Subsidiary shares corresponding to Series A Common Shares to the holders of
Series A Common Shares, Qualifying Subsidiary shares corresponding to
Common Shares to the holders of Common Shares, and Qualifying Subsidiary
shares corresponding to Special Common Shares to the holders of Special
Common Shares with respect to any Retained Interest in such Tracking Group,
provided that the same number of shares of Qualifying Subsidiary common
stock on a combined basis shall be distributed for each Series A Common
Share, Common Share and any issued Special Common Share. If practicable,
the Board shall recapitalize such Qualifying Subsidiary or Qualifying
Subsidiaries through an amendment to its charter or otherwise, such that
the shares of capital stock of such subsidiary and the relative rights,
limitations and preferences thereof substantially correspond to the
Series A Common Shares, Common Shares and Special Common Shares of the
Corporation and their relative rights, limitations and preferences, as may
be determined to be necessary or appropriate in the sole discretion of the
Board, in order to
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<PAGE>
permit the distribution to be effected in the foregoing manner; PROVIDED
that, if the Qualifying Subsidiary has or will have shares corresponding
to Series A Common Shares and Common Shares but does not and will not
have shares corresponding to Special Common Shares and it is
impracticable to recapitalize the subsidiary as provided in this
sentence to create shares corresponding to Special Common Shares, the
Board shall distribute Qualifying Subsidiary shares corresponding to
Common Shares to the holders of Tracking Stock which would otherwise be
entitled to receive Qualifying Subsidiary shares corresponding to
Special Common Shares, and shall distribute Qualifying Subsidiary shares
corresponding to Common Shares to the holders of Special Common Shares
in respect of the Retained Interest.
14. PROCEDURES RELATING TO CONVERSION OR REDEMPTION OF TRACKING STOCK.
(a) Upon the Corporation's decision to convert or redeem all of the
outstanding shares of any class of Tracking Stock as described in
paragraphs 12 or 13 of this Section B, the Corporation shall announce
publicly by press release (i) the number of outstanding shares of the class
of Tracking Stock which will be converted or redeemed, (ii) the Number of
Shares Issuable to Third Parties of such Tracking Stock, including the
number of such shares which are issuable as Committed Acquisition Shares
and into or for which Convertible Securities are then convertible,
exercisable or exchangeable and the conversion, exercise or exchange prices
thereof (and stating which, if any, of such Convertible Securities are
Pre-Distribution Convertible Securities), (iii) the Optional Conversion
Percentage and other details as to the calculation thereof, and (iv) the
Outstanding Interest Fraction and the Adjusted Outstanding Interest
Fraction for such Tracking Stock as of a recent date preceding the date of
such notice. The Corporation shall subsequently announce publicly by press
release whether the shares of such Tracking Stock are being converted in
exchange for Special Common Shares, shares of another Tracking Stock or a
combination thereof on a pro rata basis, or are being redeemed for shares
of a Qualifying Subsidiary. A notice by the Corporation that the
Corporation is considering a conversion or redemption or is seeking a
ruling from the Internal Revenue Service relating to a possible conversion
or redemption shall not constitute an announcement of a decision with
respect to a redemption or conversion pursuant to this paragraph 14.
(b) The Corporation's decision to convert or redeem all of the
outstanding shares of Tracking Stock as described in paragraphs 12 or 13 of
this Section B shall be revocable, and the determination of the Board with
respect to which securities the Corporation shall use to convert or redeem
such Tracking Stock shall be revocable, and any such conversion or
redemption may be abandoned or modified by the Corporation, in the sole
discretion of the Board, at any time prior to the Corporation's delivery of
the replacement securities in exchange for the converted or redeemed shares
of Tracking Stock.
(c) If the Corporation determines to convert the shares of any class
of Tracking Stock into Special Common Shares or shares of any other class
or classes of Tracking Stock or any combination thereof, as described in
paragraph 12 of this Section B, the Corporation shall promptly cause to be
given to each holder of shares of Tracking Stock to be converted a notice
setting forth (i) a statement that all outstanding shares of such class of
Tracking Stock shall be converted in exchange for Special Common Shares or
shares of any other class of Tracking Stock or any combination thereof on a
pro rata basis, specifying the shares or combination thereof, (ii) the
anticipated conversion date (which shall not be more than 90 Trading Days
following the press release that publicly announces such a conversion),
(iii) the per share number (or fraction) of Special Common Shares or shares
of another class of Tracking Stock or combination thereof, as applicable,
to be received with respect to each share of the Converted Tracking Stock,
specifying such number or fraction of shares or combination thereof, the
Optional Conversion Percentage and other details as to the calculation
thereof, (iv) the place or places where certificates for shares of such
Tracking Stock to be redeemed, properly endorsed or assigned for transfer
(unless the Corporation waives such requirement), are to be surrendered for
delivery of certificates for Special Common Shares, shares of another class
of Tracking Stock or both, and (v) the number of outstanding shares of such
Tracking Stock to be redeemed and the Number of Shares Issuable to Third
Parties of such Tracking Stock, including the number of such shares which
are issuable as Committed Acquisition Shares and the number of shares of
such Tracking Stock into or for which outstanding Convertible Securities
are then convertible, exercisable or exchangeable and the conversion,
exercise or exchange prices thereof (and stating which, if any, of such
Convertible Securities are Pre-Distribution Convertible Securities). Such
notice shall be sent not less than 25 Trading Days nor more than 35 Trading
Days prior to the conversion date.
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<PAGE>
(d) If the Corporation determines to redeem the shares of any class
of Tracking Stock Shares into shares of a Qualifying Subsidiary as
described in paragraph 13 of this Section B, the Corporation shall promptly
cause to be given to each holder of shares of Tracking Stock to be redeemed
a notice setting forth (i) a statement that all outstanding shares of such
class of Tracking Stock shall be redeemed in exchange for shares of a
Qualifying Subsidiary, (ii) the anticipated redemption date (which shall
not be more than 90 Trading Days following the press release that publicly
announces such a redemption), (iii) the Adjusted Outstanding Interest
Fraction for such Tracking Stock as of a recent date preceding the date of
such notice, (iv) the place or places where certificates for shares of such
Tracking Stock are to be redeemed, properly endorsed or assigned for
transfer (unless the Corporation waives such requirement), are to be
surrendered for delivery of certificates for shares of common stock of the
Qualifying Subsidiary, and (v) the number of outstanding shares of such
Tracking Stock and the Number of Shares Issuable to Third Parties of such
Tracking Stock, including the number of such shares which are issuable as
Committed Acquisition Shares and the number of shares of such Tracking
Stock into or for which outstanding Convertible Securities are then
convertible, exercisable or exchangeable and the conversion, exercise or
exchange prices thereof (and stating which, if any, of such Convertible
Securities are Pre-Distribution Convertible Securities). Such notice shall
be sent not less than 25 Trading Days nor more than 35 Trading Days prior
to the redemption date.
15. GENERAL PROVISIONS RELATING TO CONVERSIONS AND REDEMPTIONS.
(a) In each case in which a notice is required to be given to holders
of outstanding shares of any class of Tracking Stock in accordance with
paragraphs 11 or 14 (other than a notice to holders of shares selected for
a partial redemption), notice shall also be given, within the required time
period, to each holder of Convertible Securities that are convertible into
or exercisable or exchangeable for shares of such Tracking Stock (unless
provision for such notice is otherwise made pursuant to the terms of such
Convertible Securities), which notice shall include, in addition to all of
the information set forth in the corresponding notice to holders of shares
of such Tracking Stock, a statement to the effect that the holders of such
Convertible Securities shall be entitled to receive the dividend,
participate in the redemption of shares following a Disposition with
respect to such Tracking Stock or in the selection of shares for conversion
or redemption, participate in the conversion of shares or participate in
the redemption of shares in exchange for stock of the Qualifying
Subsidiaries only if such holder appropriately converts, exercises or
exchanges such Convertible Securities on or prior to the record date for
the dividend, redemption date, date fixed for selection of shares to be
redeemed or conversion date, as applicable, set forth in such notice. In
the case of a conversion or redemption of shares of any class of Tracking
Stock, the notice to holders of Convertible Securities shall also state
what, if anything, such holders shall be entitled to receive pursuant to
the terms of such Convertible Securities if such holders convert, exercise
or exchange such Convertible Securities following the conversion date or
redemption date, as applicable.
(b) All notices required to be given in accordance with this
paragraph 15 or paragraphs 11 or 14 shall be sent to a holder by first
class mail, postage prepaid, at the holder's address as the same appears on
the transfer books of the Corporation. Neither the failure to mail any
notice to any particular holder of shares of Tracking Stock or of
Convertible Securities nor any defect therein shall affect the sufficiency
thereof with respect to any other holder of outstanding shares of Tracking
Stock or of Convertible Securities, or the validity of any conversion or
redemption.
(c) The Corporation shall not be required to issue or deliver
fractional shares of any class of capital stock or any fractional
securities to any holder of shares of Tracking Stock upon any conversion or
redemption, dividend or other distribution described in paragraphs 10, 12
or 13 of this Section B. In connection with the determination of the number
of shares of any class of capital stock that is issuable or the amount of
securities that is deliverable to any holder of record upon any conversion
or redemption, dividend or other distribution (including any fractions of
shares or securities), the Corporation may aggregate the number of shares
of Tracking Stock held at the relevant time by such holder of record. If
the number of shares of any class of capital stock or the amount of
securities remaining to be issued or delivered to any holder of shares of
Tracking Stock is a fraction, the Corporation shall, if such fraction is
not issued or delivered to such holder, pay a cash adjustment in respect of
such fraction in an amount equal to the fair market value of such fraction
on the fifth Trading Day prior to the date such payment is to be made
(without interest). For purposes of the preceding sentence, "fair market
value" of any fraction shall be (i) in the case of any fraction of a share
of capital stock of the Corporation, the product of such fraction and
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<PAGE>
the Market Value of one share of such capital stock and (ii) in the case
of any other fractional security, such value as is determined by the
Board.
(d) No adjustments in respect of dividends shall be made upon the
conversion or redemption of any shares of Tracking Stock; PROVIDED,
HOWEVER, that if the conversion or redemption date with respect to a class
of Tracking Stock is subsequent to the record date for the payment of a
dividend or other distribution thereon or with respect thereto, the holders
of shares of such class of Tracking Stock at the close of business on such
record date shall be entitled to receive the dividend or other distribution
payable on or with respect to such shares on the date set for payment of
such dividend or other distribution, notwithstanding a conversion or
redemption by the Corporation of such shares or the Corporation's default
in payment of the dividend or distribution due on such date.
(e) Before any holder of shares of any class of Tracking Stock shall
be entitled to receive certificates representing shares of any kind of
capital stock or cash, securities or other property or combination thereof
to be received by such holder with respect to any conversion or redemption
of such Tracking Stock, such holder shall be required to surrender at such
place as the Corporation shall specify certificates for such shares,
properly endorsed or assigned for transfer (unless the Corporation waives
such requirement). The Corporation shall as soon as practicable after
surrender of certificates representing shares of such Tracking Stock
deliver to the person for whose account such shares were so surrendered, or
to the nominee or nominees of such person, certificates representing the
number of whole shares of the kind of capital stock or cash, securities or
other property or combination thereof to which such person is entitled,
together with any payment for fractional securities referred to above. The
Corporation shall not be required to register (i) a transfer of any shares
of Tracking Stock for a period of up to 15 Trading Days preceding the
conversion date or redemption date or (ii) any shares of Tracking Stock
selected for redemption.
(f) From and after any applicable conversion or redemption date, all
rights of a holder of shares of any class of Tracking Stock that were
converted or redeemed shall cease except for the right, upon surrender of
the certificates representing such Tracking Stock, to receive certificates
representing shares of the kind and amount of capital stock or cash,
securities or other property or combination thereof for which such shares
of Tracking Stock were converted or redeemed, together with any payment for
fractional securities, and such holder shall have no other or further
rights in respect of the Tracking Stock so converted or redeemed,
including, but not limited to, any rights with respect to any shares of
capital stock or cash, securities or other property or combination thereof
which are reserved or otherwise designated by the Corporation as being held
for the satisfaction of the Corporation's obligations to pay or deliver any
shares of capital stock, cash, securities or other property or combination
thereof upon the conversion, exercise or exchange of any outstanding
Convertible Securities or with respect to any other Shares Issuable to
Third Parties related to the conversion or redemption of such Tracking
Stock as of the date of such conversion or redemption. No holder of a
certificate that, immediately prior to the applicable conversion or
redemption date for any class of Tracking Stock, represented shares of
Tracking Stock which were converted or redeemed shall be entitled to
receive any dividend or other distribution with respect to shares of any
kind of capital stock or other securities into or in exchange for which the
shares of such Tracking Stock were converted or redeemed until surrender of
such holder's certificate for a certificate or certificates representing
shares of such kind of capital stock or other securities. Upon such
surrender, there shall be paid to the holder the amount of any dividends or
other distributions (without interest) which theretofore became payable
with respect to a record date after the conversion date or redemption date,
as the case may be, but that were not paid by reason of the foregoing, with
respect to the number of whole shares of the kind of capital stock or other
securities represented by the certificate or certificates issued upon such
surrender.
(g) The Corporation shall pay any and all documentary, stamp or
similar issue or transfer taxes that may be payable in respect of the issue
or delivery of any shares of capital stock or other securities on the
conversion or redemption of any class of Tracking Stock. The Corporation
shall not be required to pay any tax that may be payable in respect of any
transfer involved in the issue and delivery of any shares of capital stock
or other securities in a name other than that in which the shares of
Tracking Stock so converted or redeemed were registered and no such issue
or delivery shall be made unless and until the person requesting such issue
has paid to the Corporation the amount of any such tax, or has established
to the satisfaction of the Corporation that such tax has been paid.
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<PAGE>
16. EFFECTS ON CONVERTIBLE SECURITIES.
(a) The following provisions with respect to Convertible Securities
shall apply only to the extent that the terms of such Convertible
Securities do not provide for adjustments in the event of a conversion or
redemption described in paragraphs 10, 12 or 13 of this Section B.
(b) After any conversion date or redemption date on which all
outstanding shares of any class of Tracking Stock were converted or
redeemed, any share of such class of Tracking Stock that is to be issued on
conversion, exchange or exercise of any Convertible Security shall,
immediately upon such conversion, exchange or exercise and without any
notice or any other action on the part of, the Corporation or its Board or
the holder of such Convertible Security:
(i) in the event the shares of such class of Tracking Stock
outstanding on such conversion date were converted into Special Common
Shares or shares of another class or classes of Tracking Stock or
combination thereof pursuant to the provisions described in
subparagraph (iii) of paragraph 10(b), paragraph 10(f) or paragraph 12
of this Section B, be converted into the number of Special Common
Shares or shares of another class or classes of Tracking Stock or
combination thereof that the number of shares of such class of
Tracking Stock, that were to be issued upon such conversion, exchange
or exercise, would have received had such shares been outstanding on
such conversion date; or
(ii) in the event the shares of such class of Tracking Stock
outstanding on such redemption date were redeemed pursuant to the
provisions described in subparagraph (ii)(A) of paragraph 10(b) of
this Section B or redeemed for shares of capital stock of a Qualifying
Subsidiary or Qualifying Subsidiaries pursuant to paragraph 13 of this
Section B, be redeemed, to the extent of funds of the Corporation
legally available therefor, for the kind and amount of cash,
securities or property or any combination thereof, or shares of
capital stock of a Qualifying Subsidiary or Qualifying Subsidiaries,
that the number of shares of such class of Tracking Stock, that were
to be issued upon such conversion, exchange or exercise, would have
received had such shares been outstanding on such redemption date.
(c) If determined to be appropriate in the sole discretion of the
Board, any such capital stock or cash, securities or property or any
combination thereof to be delivered upon such conversion or redemption may
be irrevocably transferred in trust for the benefit of holders of such
Convertible Securities.
17. OTHER PROVISIONS.
(a) The Board shall have the power to issue or sell any class or
series of stock herein or hereafter authorized, for such consideration as
the Board shall from time to time, in its discretion, determine, whether or
not greater consideration could be received upon the issue or sale of
shares of another class or series, and as otherwise permitted by law.
(b) The Board shall have the power to purchase any class or series of
stock herein or hereafter authorized for such consideration as the Board
shall from time to time, in its discretion, determine, whether or not
lesser consideration could be paid upon the purchase of shares of another
class or series, and as otherwise permitted by law.
(c) If the Corporation shall in any manner split, subdivide or
combine the outstanding Common Shares, Series A Common Shares or Special
Common Shares, all outstanding Common Shares, Series A Common Shares and
Special Common Shares shall be proportionally split, subdivided or combined
in the same manner and on the same basis.
(d) In the event of a merger or consolidation of the Corporation with
or into another entity (whether or not the Corporation is the surviving
entity), the holders of Special Common Shares and Common Shares shall be
entitled to receive the same consideration per share as a result of such
merger or consolidation; provided, that this requirement shall be deemed to
be satisfied if the consideration received by the holders of Special Common
Shares consists of securities which have relative rights, preferences and
limitations vis-a-vis the securities received
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by the holders of Common Shares that, in the judgment of the Board, are
substantially similar in all material respects to the relative rights,
preferences and limitations of the Special Common Shares vis-a-vis the
Common Shares, respectively.
(e) Every reference in this Restated Certificate of Incorporation or
under Delaware law to a majority or other proportion of shares of capital
stock shall, to the extent permitted under Delaware law, refer to a
majority or such other proportion of the votes entitled to be cast by such
shares of capital stock.
(f) In accordance with Section 203(b)(3) of the DGCL, the Corporation
expressly elects not be governed by Section 203 of the DGCL.
(g) Advance notice of shareholder nominations for election of
directors and other business to be brought by shareholders before a meeting
of shareholders shall be given in the manner provided in the Bylaws of the
Corporation.
(h) Any action required to be taken or which may be taken at any
annual or special meeting of stockholders may be taken without a meeting,
without prior notice and without a vote if a consent or consents in
writing, setting forth the action so taken, shall be signed by persons
entitled to vote capital stock of the Corporation representing not less
than 90% of the voting power of the shares that would be necessary to
authorize or take such action at a meeting at which all shares of capital
stock of the Corporation entitled to vote thereon were present and voted.
18. REDEMPTION TO PROTECT LICENSES.
(a) Notwithstanding any other provision of this Restated Certificate
of Incorporation, as amended, to the contrary, any outstanding shares of
stock of the Corporation (other than Series A Common Shares) shall be
subject to redemption by the Corporation, by action of the Board, if in the
judgment of the Board such action should be taken, pursuant to Section
151(b)(2) of the DGCL or any other applicable provision of law, to the
extent necessary to prevent the loss or secure the reinstatement of, or to
prevent the denial of applications for or the renewal of, any license or
franchise from any governmental agency held by the Corporation or any of
its Subsidiaries, or of any person in which the Corporation has any
ownership or voting interest, direct or indirect, to conduct any portion of
the business of the Corporation or any of its Subsidiaries, or any person
in which the Corporation has any ownership or voting interest, direct or
indirect, which license or franchise is conditioned upon some or all of the
holders of the Corporation's stock, or any other person with the right to
vote such stock or on whose behalf such stock is owned or voted, possessing
prescribed qualifications or any other condition. The terms and conditions
of such redemption shall be as follows:
(i) The redemption price of the shares to be redeemed pursuant
to this paragraph 18 shall be equal to the lesser of (A) the Fair
Market Value of such shares or (B) if such shares were purchased by
such Disqualified Holder within one year of the Redemption Date, such
Disqualified Holder's purchase price for such shares;
(ii) The redemption price of such shares may be paid in cash,
Redemption Securities or any combination thereof;
(iii) If less than all the shares held by Disqualified Holders are
to be redeemed, the shares to be redeemed shall be selected in such
manner as shall be determined by the Board, which may include
selection first of the most recently purchased shares thereof,
selection by lot or selection in any other manner determined by the
Board;
(iv) At least 30 days' written notice of the Redemption Date
shall be given to the record holders of the shares selected to be
redeemed (unless waived in writing by any such holder); PROVIDED that
the Redemption Date may be the date on which written notice shall be
given to record holders if the cash or Redemption Securities necessary
to effect the redemption shall have been deposited in trust for the
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benefit of such record holders and subject to immediate withdrawal by
them upon surrender of the stock certificates for their shares to be
redeemed;
(v) From and after the Redemption Date, any and all rights of
whatever nature, which may be held by the owners of shares selected
for redemption (including without limitation any rights to vote or
participate in dividends declared on stock of the same class or series
as such shares), shall cease and terminate and they shall thenceforth
be entitled only to receive the cash or Redemption Securities payable
upon redemption; and
(vi) Such other terms and conditions as the Board shall
determine.
(b) For purposes of this paragraph 18:
"DISQUALIFIED HOLDER" shall mean any holder of shares of stock of the
Corporation whose holding of such stock on behalf of such holder or on
behalf of any other person involving any beneficial or other indirect
ownership interest or voting power with respect to such stock, either
individually or when taken together with the holding or voting of shares of
stock of the Corporation by any other holders or persons entitled to vote
such stock, may result, in the good faith judgment of the Board, in the
loss of, or the failure to secure the reinstatement of, or the denial of
applications for or the renewal of, any license or franchise from any
governmental agency held by the Corporation or any of its Subsidiaries or
of any person in which the Corporation has any ownership or voting interest
to conduct any portion of the business of the Corporation or any of its
Subsidiaries or of any person in which the Corporation has any ownership or
voting interest, direct or indirect.
"FAIR MARKET VALUE" of a share of the Corporation's stock of any class
or series shall mean the average Closing Price for such a share for each of
the 20 most recent days on which shares of stock of such class or series
shall have been traded preceding the day on which notice of redemption
shall be given pursuant to this paragraph 18; PROVIDED, HOWEVER, that if
shares of stock of such class or series are not traded on any securities
exchange or in the over-the-counter market, "Fair Market Value" shall be
determined by the Board in good faith. "Closing Price" on any day means the
reported closing sales price or, in case no such sale takes place, the
average of the reported closing bid and asked prices 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 exchange, the highest closing sales price or bid quotation for
such stock on the Nasdaq Stock Market or any system then in use, or if no
such prices or quotations are available, the fair market value on the day
in question as determined by the Board in good faith.
A "PERSON" shall mean an individual, a corporation, a partnership, a
joint venture, a trust or unincorporated organization, a joint stock
company or similar organization, a government or any political subdivision
thereof, or any other legal entity.
"REDEMPTION DATE" shall mean the date fixed by the Board for the
redemption of shares of stock of the Corporation pursuant to this paragraph
18.
"REDEMPTION SECURITIES" shall mean any debt or equity securities
(other than Series A Common Shares or securities convertible into or
exchangeable for, or carrying a right to subscribe to or acquire, Series A
Common Shares) of the Corporation, any of its Subsidiaries or any other
corporation, or any combination thereof, having such terms and conditions
as shall be approved by the Board and which, together with any cash to be
paid as part of the redemption price, in the opinion of any nationally
recognized investment banking firm selected by the Board (which may be a
firm which provides other investment banking, brokerage or other services
to the Corporation), has a value, at the time notice of redemption is given
pursuant to subparagraph (a)(iv) of this paragraph 18, at least equal to
the price required to be paid pursuant to subparagraph (a)(i) of this
paragraph 18 (assuming, in the case of Redemption Securities to be publicly
traded, such Redemption Securities were fully distributed and subject only
to normal trading activity).
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19. DEFINITIONS. In addition to the definitions set forth above in this
Restated Certificate of Incorporation, unless the context requires otherwise,
the following terms shall have the meanings specified below:
"ADJUSTED OUTSTANDING INTEREST FRACTION," as of any date, shall mean, with
respect to a particular class of Tracking Stock, a fraction the numerator of
which is the aggregate number of shares of such class of Tracking Stock
outstanding on such date and the denominator of which is the sum of (a) such
aggregate number of outstanding shares, (b) the Number of Shares Issuable with
Respect to Retained Interest for such class of Tracking Stock as of such date,
(c) the aggregate Number of Shares Issuable with Respect to Inter-Group Interest
by all other Tracking Groups in such Tracking Stock, if any, as of such date and
(d) the Number of Shares Issuable to Third Parties with respect to such Tracking
Stock as of such date.
"AERIAL" shall mean Aerial Communications, Inc., a Delaware corporation.
"AERIAL GROUP" shall mean, as of any date, that any Aerial Group Common
Shares have been issued and continue to be outstanding:
(a) the interest of the Corporation or any of its subsidiaries in
Aerial and its subsidiaries (including any successor thereto by merger,
consolidation or sale of all or substantially all of its assets, whether or
not in connection with a Related Business Transaction) and their respective
businesses, assets and liabilities, except any of such businesses, assets
or liabilities which have been attributed by the Board to another Group;
(b) all businesses, assets and liabilities of the Corporation or any
of its subsidiaries to the extent attributed to the Aerial Group by the
Board, whether or not such businesses, assets or liabilities are
businesses, assets and liabilities of Aerial or any of its subsidiaries (or
a successor as described in clause (a) of this sentence);
(c) all businesses, assets and liabilities contributed or otherwise
transferred to the Aerial Group from the TDS Group or any of the other
Tracking Groups;
(d) the interest of the Corporation or any of its subsidiaries in the
businesses, assets and liabilities acquired by the Corporation or any of
its subsidiaries for the Aerial Group, as determined by the Board;
(e) a proportionate undivided interest in each and every business,
asset and liability attributed to another Tracking Group equal to the
Inter-Group Interest Fraction, if any, of the Aerial Group in such other
Tracking Group; and
(f) such other businesses, assets and liabilities and such
adjustments to the foregoing as may be contemplated hereby or which may be
determined in good faith by the Board.
If a Retained Interest in the Aerial Group is then existing and if the
Corporation shall pay a dividend or make any other distribution with respect to
Aerial Group Common Shares payable in cash, securities or other property of the
Corporation attributed to the Aerial Group, other than Aerial Group Common
Shares, the TDS Group shall be deemed to hold an amount or fair value thereof
(as determined in good faith by the Board) of such cash, securities or other
property equal to the amount or fair value so distributed multiplied by a
fraction the numerator of which is the Aerial Group's Retained Interest Fraction
and the denominator of which is the Aerial Group's Outstanding Interest Fraction
in effect immediately prior to the record date for such dividend or other
distribution and, to the extent interest or dividends are paid or other
distributions are made on any securities other than Aerial Group Common Shares
so distributed to the holders of Aerial Group Common Shares, the Aerial Group
shall no longer include a corresponding ratable amount or fair value of the kind
of assets paid as such interest or dividends or other distributions in respect
of such securities deemed to be held by the TDS Group.
If an Inter-Group Interest in the Aerial Group is then existing and if the
Corporation shall pay a dividend or make any other distribution with respect to
Aerial Group Common Shares payable in cash, securities or other property of the
Corporation attributed to the Aerial Group other than Aerial Group Common
Shares, the Tracking Group(s) holding the Inter-Group Interest(s) in the Aerial
Group shall be deemed to hold an amount or fair value thereof (as determined in
good faith by the Board) of such cash, securities or other property equal to the
amount or fair value so distributed multiplied by a fraction the numerator of
which is the Inter-Group Interest Fraction in the Aerial Group in effect
immediately prior to the record date for such dividend or other distribution and
the denominator of which is equal to the Aerial Group's Outstanding Interest
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Fraction in effect immediately prior to the record date for such dividend or
other distribution and, to the extent interest or dividends are paid or other
distributions are made on any securities other than Aerial Group Common
Shares so distributed to the holders of Aerial Group Common Shares, the
Aerial Group shall no longer include a corresponding ratable amount or fair
value of the kind of assets paid as such interest or dividends or other
distributions in respect of such securities deemed to be held by the Tracking
Group holding the Inter-Group Interest in the Aerial Group.
From and after any transfer of cash, securities or other property from the
Aerial Group to the TDS Group or to another Tracking Group, the Aerial Group
shall no longer include the cash, securities or other property so transferred
and the TDS Group or such other Tracking Group, as the case may be, shall
include such cash, securities or other property, and from and after any transfer
of cash, securities or other property from the TDS Group or another Tracking
Group to the Aerial Group, the TDS Group or such other Tracking Group, as the
case may be, shall no longer include the cash, securities or other property so
transferred and the Aerial Group shall include such cash, securities or other
property.
"AERIAL GROUP COMMON SHARES," shall mean the Aerial Communications Group
Common Shares, par value $0.01 per share.
"AVAILABLE DIVIDEND AMOUNT," as of any date, shall mean, with respect to
any Tracking Group, the product of the Outstanding Interest Fraction of such
Tracking Group and either (a) the excess of (i) an amount equal to the total
assets of such Tracking Group less the total liabilities (not including
preferred stock) of such Tracking Group as of such date over (ii) the aggregate
par value of, or any greater amount determined to be capital in respect of, all
outstanding shares of such class of Tracking Stock of such Tracking Group and
each class or series of Preferred Shares or Undesignated Shares attributed to
such Tracking Group or (b) in case there is no such excess, an amount equal to
Corporation Earnings (Losses) attributable to such Tracking Group (if positive)
for the fiscal year in which such date occurs and/or the preceding fiscal year.
The Available Dividend Amount for a Tracking Group is intended to be similar to
an amount equal to the product of the Outstanding Interest Fraction and the
amount that would be legally available for the payment of dividends on shares of
Tracking Stock under Delaware law if the related Tracking Group were a separate
Delaware corporation. The "Available Dividend Amount" as of any date, shall
mean, with respect to the TDS Group, the greater of (x) the amount of all
surplus (as defined in the DGCL) of the Corporation or, if there is no surplus,
the net profits (as contemplated by the DGCL) of the Corporation for the fiscal
year in which such date occurs and/or the preceding fiscal year (if positive),
less the sum of the Available Dividend Amounts of all of the Tracking Groups, or
(y) an amount equal to the sum of the Retained Interest Available Dividend
Amounts (if positive) with respect to all of the Tracking Groups, plus, without
duplication, either (a) the excess of (i) an amount equal to the total assets of
the TDS Group less the total liabilities (not including preferred stock) of the
TDS Group as of such date over (ii) the aggregate par value of, or any greater
amount determined to be capital in respect of, all outstanding Series A Common
Shares, Common Shares and any issued Special Common Shares, and each class or
series of Preferred Shares or Undesignated Shares attributed to the TDS Group or
(b) in case there is no such excess, an amount equal to Corporation Earnings
(Losses) attributable to the TDS Group (if positive) for the fiscal year in
which such date occurs and/or the preceding fiscal year.
"BOARD" shall mean the Board of Directors of the Corporation.
"CELLULAR GROUP" shall mean, as of any date, that any shares of Cellular
Group Stock have been issued and continue to be outstanding:
(a) the interest of the Corporation or any of its subsidiaries in
U.S. Cellular and its subsidiaries (including any successor thereto by
merger, consolidation or sale of all or substantially all of its assets,
whether or not in connection with a Related Business Transaction) and their
respective businesses, assets and liabilities, except any of such
businesses, assets or liabilities which have been attributed by the Board
to another Group;
(b) all businesses, assets and liabilities of the Corporation or any
of its subsidiaries to the extent attributed to the Cellular Group by the
Board, whether or not such businesses, assets or liabilities are
businesses, assets and liabilities of U.S. Cellular or any of its
subsidiaries (or a successor as described in clause (a) of this sentence);
(c) all businesses, assets and liabilities contributed or otherwise
transferred to the Cellular Group from the TDS Group or any of the other
Tracking Groups;
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(d) the interest of the Corporation or any of its subsidiaries in the
businesses, assets and liabilities acquired by the Corporation or any of
its subsidiaries for the Cellular Group, as determined by the Board;
(e) a proportionate undivided interest in each and every business,
asset and liability attributed to another Tracking Group equal to the
Inter-Group Interest Fraction, if any, of the Cellular Group in such other
Tracking Group; and
(f) such other businesses, assets and liabilities and such
adjustments to the foregoing as may be contemplated hereby or which may be
determined in good faith by the Board.
If a Retained Interest in the Cellular Group is then existing and if the
Corporation shall pay a dividend or make any other distribution with respect to
Cellular Group Common Shares payable in cash, securities or other property of
the Corporation attributed to the Cellular Group, other than Cellular Group
Common Shares, the TDS Group shall be deemed to hold an amount or fair value
thereof (as determined in good faith by the Board) of such cash, securities or
other property equal to the amount or fair value so distributed multiplied by a
fraction the numerator of which is the Cellular Group's Retained Interest
Fraction and the denominator of which is the Cellular Group's Outstanding
Interest Fraction in effect immediately prior to the record date for such
dividend or other distribution and, to the extent interest or dividends are paid
or other distributions are made on any securities other than Cellular Group
Common Shares so distributed to the holders of Cellular Group Common Shares, the
Cellular Group shall no longer include a corresponding ratable amount or fair
value of the kind of assets paid as such interest or dividends or other
distributions in respect of such securities deemed to be held by the TDS Group.
If an Inter-Group Interest in the Cellular Group is then existing and if
the Corporation shall pay a dividend or make any other distribution with respect
to Cellular Group Common Shares payable in cash, securities or other property of
the Corporation attributed to the Cellular Group other than Cellular Group
Common Shares, the Tracking Group holding the Inter-Group Interest in the
Cellular Group shall be deemed to hold an amount or fair value thereof (as
determined in good faith by the Board) of such cash, securities or other
property equal to the amount or fair value so distributed multiplied by a
fraction the numerator of which is the Inter-Group Interest Fraction in the
Cellular Group in effect immediately prior to the record date for such dividend
or other distribution and the denominator of which is equal to the Cellular
Group's Outstanding Interest Fraction in effect immediately prior to the record
date for such dividend or other distribution and, to the extent interest or
dividends are paid or other distributions are made on any securities other than
Cellular Group Common Shares so distributed to the holders of Cellular Group
Common Shares, the Cellular Group shall no longer include a corresponding
ratable amount or fair value of the kind of assets paid as such interest or
dividends or other distributions in respect of such securities deemed to be held
by the Tracking Group holding the Inter-Group Interest in the Cellular Group.
From and after any transfer of cash, securities or other property from the
Cellular Group to the TDS Group or to another Tracking Group, the Cellular Group
shall no longer include the cash, securities or other property so transferred
and the TDS Group or such other Tracking Group, as the case may be, shall
include such cash, securities or other property, and from and after any transfer
of cash, securities or other property from the TDS Group or another Tracking
Group to the Cellular Group, the TDS Group or such other Tracking Group, as the
case may be, shall no longer include the cash, securities or other property so
transferred and the Cellular Group shall include such cash, securities or other
property.
"CELLULAR GROUP COMMON SHARES" means the United States Cellular Group
Common Shares, par value $0.01 per share.
"COMMITTED ACQUISITION SHARES," as of any date, shall mean (a) Common
Shares that the Corporation had, prior to such date, agreed to issue in
connection with acquisitions, but as of such date had not been issued, and (b)
Common Shares that are issuable upon conversion, exercise or exchange of
Convertible Securities that the Corporation had, prior to such date, agreed to
issue in connection with acquisitions, but as of such date had not been issued,
in each case including obligations of the Corporation to issue Cellular Group
Common Shares, Telecom Group Common Shares and Aerial Group Common Shares as a
result of the Distribution pursuant to anti-dilution provisions in the
acquisition agreements providing for the issuance of Common Shares or
Convertible Securities which are convertible into or exercisable or exchangeable
for Common Shares, without duplication of any Common Shares issuable upon
conversion, exercise or exchange of Convertible Securities.
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"COMMON STOCK" shall mean shares of capital stock of the Corporation
designated as common stock, including Series A Common Shares, Common Shares,
Special Common Shares, Cellular Group Common Shares, Telecom Group Common Shares
and Aerial Group Common Shares.
"CORPORATION EARNINGS (LOSS)" for any period, with respect to any class of
Common Stock, shall mean the net earnings or loss of the related Group for such
period determined on a basis consistent with the determination of the net
earnings or loss of such Group for such period as presented in the combined
financial statements of such Group for such period, including income and
expenses of the Corporation attributed to the operations of such Group on a
substantially consistent basis, including without limitation, corporate, general
and administrative costs, net interest and income taxes.
"CONVERTIBLE SECURITIES" shall mean any securities of the Corporation,
including preferred stock, options and other rights (other than Common Stock),
that are convertible into, exchangeable for or evidence the right to purchase
any shares of any class or series of Common Stock, whether upon conversion,
exercise or exchange, pursuant to anti-dilution provisions of such securities or
otherwise.
"DGCL" shall mean the Delaware General Corporation Law.
"DISTRIBUTION" shall mean the contemplated initial distribution of Cellular
Group Shares, Telecom Group Shares and/or Aerial Group Shares or any part
thereof to be made to the holders of Common Shares and Series A Common Shares.
"FAIR VALUE OF NET PROCEEDS" shall mean, as of any date, with respect to
any Disposition of any of the businesses, assets and liabilities of a Tracking
Group, an amount, if any, equal to the fair value of the gross proceeds of such
Disposition less any payment of, or reasonable provision for, (a) any taxes
related to such Disposition or in respect of any resulting dividend or
redemption, including deferred taxes, but not including any deductions or other
offsets which may be available to the Corporation which are not attributed to
such Tracking Group, (b) any transaction costs, including, without limitation,
any legal, investment banking and accounting fees and expenses and (c) any
liabilities and other obligations (contingent or otherwise) of, or attributed
to, that Tracking Group, including, without limitation, obligations with respect
to committed acquisitions and Convertible Securities attributed to the Tracking
Group, any indemnity or guarantee obligations incurred in connection with the
Disposition or any liabilities for future purchase price adjustments, and any
preferential amounts plus any accumulated and unpaid dividends and other
obligations in respect of any class or series of Preferred Shares or
Undesignated Shares attributed to such Tracking Group (without duplication). For
purposes of this definition, any businesses, assets and liabilities of the
affected Tracking Group which the Board determines to retain after such
Disposition shall be deemed to constitute "reasonable provision" for such amount
of taxes, costs and liabilities (contingent or otherwise). To the extent the
proceeds of any Disposition include any securities or other property other than
cash, the Board shall determine the fair value of such securities or property,
including for the purpose of determining the comparable value thereof if the
Board determines to pay a dividend or redemption price in cash or securities or
other property as provided in this Restated Certificate of Incorporation.
"GROUP" shall mean the Aerial Group, the Cellular Group, the Telecom Group
and the TDS Group and any other Group so designated by the Board.
"INITIAL ISSUANCE DATE" shall mean, with respect to a class of stock, the
initial date of issuance of shares of such class of stock.
"INTER-GROUP INTEREST," as of any date, shall mean that part of the
Corporation's equity interest in a Tracking Group which is deemed to be held (or
subsequently acquired) by the Corporation and attributed to a Group other than
the TDS Group. A Tracking Group may not hold an Inter-Group interest in the TDS
Group.
"INTER-GROUP INTEREST FRACTION," as of any date, with respect to any
Investor Group, shall mean a fraction the numerator of which is the Number of
Shares issuable with Respect to Inter-Group Interest in an Issuer Group by such
Investor Group as of such date and the denominator of which is the sum of
(a) the aggregate Number of Shares Issuable with Respect to Inter-Group Interest
in such Issuer Group by all Investor Groups as of such date, (b) the aggregate
number of shares of Tracking Stock of such Issuer Group outstanding as of such
date and (c) the Number of Shares Issuable with Respect to Retained Interest in
such Issuer Group as of such date.
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"ISSUER GROUP" shall mean a Tracking Group in which there is an Inter-Group
Interest by an Investor Group.
"INVESTOR GROUP" means a Tracking Group which holds an Inter-Group Interest
in an Issuer Group.
"MARKET CAPITALIZATION" of any class or series of capital stock of the
Corporation on any Trading Day shall mean the product of (a) the Market Value of
one share of such class or series on such Trading Day and (b) the number of
shares of such class or series outstanding at the close of business on such
Trading Day.
"MARKET VALUE" of a share of any class or series of capital stock of the
Corporation on any day shall mean the average of the high and low reported sale
prices regular way of a share of such class or series on such day (if such day
is a Trading Day, and if such day is not a Trading Day, on the Trading Day
immediately preceding such day) or in case no such reported sale takes place on
such Trading Day the average of the reported closing bid and asked prices
regular way of a share of such class or series on such Trading Day, in either
case on the American Stock Exchange or such other national securities exchange
or the Nasdaq National Market on which such class or series is listed, or if the
shares of such class or series are not quoted on the American Stock Exchange or
any other national securities exchange or the Nasdaq National Market on such
Trading Day, the average of the closing bid and asked prices of a share of such
class or series in the over-the-counter market on such Trading Day as furnished
by any New York Stock Exchange member firm selected from time to time by the
Corporation, or if such closing bid and asked prices are not made available by
any such New York Stock Exchange member firm on such Trading Day, the market
value of a share of such class or series as determined by the Board; PROVIDED,
that if the Special Common Shares or Series A Common Shares are not trading on a
national securities exchange or the Nasdaq National Market, and if bid and asked
prices are not available for the Special Common Shares or the Series A Common
Shares, the Market Value of a Special Common Share or a Series A Common Share,
as applicable, shall be deemed to be the same as a Common Share for purposes of
determining Market Value under Sections 8, 10 and 12 hereof; and PROVIDED
FURTHER, that for purposes of determining Market Values under Sections 8, 10 and
12 hereof (a) the "Market Value" of a share of any series of Common Stock on any
day prior to the "ex" date or any similar date for any dividend or distribution
paid or to be paid with respect to such series of Common Stock shall be reduced
by the fair market value of the per share amount of such dividend or
distribution as determined by the Board and (b) the "Market Value" of a share of
any series of Common Stock on any day prior to (i) the effective date of any
subdivision (by stock split or otherwise) or combination (by reverse stock split
or otherwise) of outstanding shares of such series of Common Stock or (ii) the
"ex" date or any similar date for any dividend or distribution with respect to
any such series of Common Stock in shares of such series of Common Stock, shall
be appropriately adjusted to reflect such subdivision, combination, dividend or
distribution.
"MERGER," shall mean the merger of TDS Iowa with and into the Corporation.
"NUMBER OF SHARES ISSUABLE WITH RESPECT TO INTER-GROUP INTEREST" shall
mean, with respect to any Tracking Group (for purposes of this definition, the
"Issuer Group"), the number of shares of Tracking Stock of the Issuer Group (the
"Issuer Group Shares") which are attributed to, and that could be issued or sold
by the Corporation for the benefit of, another Tracking Group (for purposes of
this definition, the "Investor Group"). Initially, the Number of Shares Issuable
with Respect to Inter-Group Interest in each Tracking Group shall be zero, and
shall from time to time thereafter, as applicable, be:
(a) adjusted as appropriate to reflect subdivisions (by stock split
or otherwise) and combinations (by reverse stock split or otherwise) of the
Issuer Group Shares and dividends or distributions of Issuer Group Shares
to the holders thereof and other reclassifications of the Issuer Group
Shares or similar transactions;
(b) decreased (but not to less than zero) by (i) the aggregate number
of Issuer Group Shares issued or sold by the Corporation, for cash,
securities or other property, the proceeds of which are attributed to the
Investor Group, (ii) the aggregate number of Issuer Group Shares issued or
delivered upon conversion, exercise or exchange of Convertible Securities,
the proceeds of which are attributed to the Investor Group, (iii) the
aggregate number of Issuer Group Shares issued or delivered by the
Corporation as a dividend or distribution to holders of shares of the
Investor Group, (iv) the aggregate number of Issuer Group Shares issued or
delivered upon the conversion, exercise or exchange of any Convertible
Securities issued or delivered by the Corporation as a dividend or
distribution or by reclassification or exchange to holders of shares of the
Investor Group, and (v) the aggregate number of Issuer Group Shares
(rounded, if necessary, to the nearest whole number), equal to the
aggregate fair value (as determined by the Board) of assets or properties
attributed to the Issuer Group that are transferred from the Issuer Group
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to the Investor Group in consideration of a reduction in the Number of
Shares Issuable with Respect to Inter-Group Interest by the Investor Group
in the Issuer Group, divided by the Market Value of one Issuer Group Share
as of the date of such transfer;
(c) increased by (i) the aggregate number of any Issuer Group Shares
which are retired or otherwise cease to be outstanding following their
purchase with funds attributed to the Investor Group and (ii) a number
(rounded, if necessary, to the nearest whole number), equal to the fair
value (as determined by the Board) of assets or properties theretofore
attributed to the Investor Group that are contributed to the Issuer Group
in consideration of an increase in the Number of Shares Issuable with
Respect to Inter-Group Interest in the Issuer Group by the Investor Group,
divided by the Market Value of one Issuer Group Share as of the date of
such contribution; and
(d) adjusted as may be appropriate to reflect other transactions
between the Issuer Group and the Investor Group, as determined in good
faith by the Board.
Whenever a change in the Number of Shares Issuable with Respect to
Inter-Group Interest with respect to any Group occurs, the Corporation shall
prepare and file a statement of such change with the Secretary of the
Corporation.
"NUMBER OF SHARES ISSUABLE WITH RESPECT TO RETAINED INTEREST" shall mean
the number of shares of a class of Tracking Stock of a Tracking Group (for
purposes of this definition, the "Issuer Group") that are attributed to, and
could be issued or sold by the Corporation for the account of, the TDS Group in
respect of a Retained Interest by the TDS Group in such Issuer Group. The Number
of Shares Issuable with Respect to Retained Interest shall initially be
determined by the Board, and shall from time to time thereafter, as applicable,
be:
(a) adjusted as appropriate to reflect subdivisions (by stock split
or otherwise) and combinations (by reverse stock split or otherwise) of the
Issuer Group Shares, and dividends or distributions of Issuer Group Shares
to the holders thereof and other reclassifications of Issuer Group Shares
or similar transactions;
(b) decreased (but not to less than zero) by (i) the aggregate number
of Issuer Group Shares issued or sold by the Corporation, for cash,
securities or other property, the proceeds of which are attributed to the
TDS Group, (ii) the aggregate number of Issuer Group Shares issued or
delivered upon conversion, exercise or exchange of Convertible Securities
(including Pre-Distribution Convertible Securities), the proceeds of which
are attributed to the TDS Group, (iii) the aggregate number of Issuer Group
Shares issued or delivered by the Corporation as a dividend or distribution
to holders of Common Shares, Series A Common Shares or Special Common
Shares, (iv) the aggregate number of Issuer Group Shares issued or
delivered upon the conversion, exercise or exchange of any Convertible
Securities issued or delivered by the Corporation as a dividend or
distribution or by reclassification or exchange to holders of shares of
Common Shares, Series A Common Shares or Special Common Shares, and (v) the
aggregate number of Issuer Group Shares (rounded, if necessary, to the
nearest whole number), equal to the aggregate fair value (as determined by
the Board) of assets or properties attributed to the Issuer Group that are
transferred from the Issuer Group to the TDS Group in consideration of a
reduction in the Number of Shares Issuable with Respect to Retained
Interest in the Issuer Group, divided by the Market Value of one Issuer
Group Share as of the date of such transfer;
(c) increased by (i) the aggregate number of any Issuer Group Shares
which are retired or otherwise cease to be outstanding following their
purchase with funds attributed to the TDS Group and (ii) a number (rounded,
if necessary, to the nearest whole number), equal to the fair value (as
determined by the Board) of assets or properties theretofore attributed to
the TDS Group that are contributed to the Issuer Group in consideration of
an increase in the Number of Shares Issuable with Respect to Retained
Interest in the Issuer Group, divided by the Market Value of one Issuer
Group Share as of the date of such contribution; and
(d) adjusted as may be appropriate to reflect other transactions
between the Issuer Group and the TDS Group, as determined in good faith by
the Board.
Whenever a change in the Number of Shares Issuable with Respect to
Retained Interest in any Tracking Group occurs, the Corporation shall
prepare and file a statement of such change with the Secretary of the
Corporation.
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"NUMBER OF SHARES ISSUABLE TO THIRD PARTIES" shall mean, as of any date,
the number of shares of any class or series of Common Stock (such shares are
herein referred to as "Shares Issuable to Third Parties") which are issuable
(a) as Committed Acquisition Shares, (b) pursuant to the conversion, exercise or
exchange of Convertible Securities or (c) otherwise, other than shares which are
deemed to be issuable with respect to a Retained Interest or with respect to an
Inter-Group Interest, as may be determined in good faith by the Board
considering any relevant factors, including whether the holders of Convertible
Securities would derive an economic benefit from the conversion, exercise or
exchange of such Convertible Securities which exceeds the economic cost thereof
or the economic benefit of not converting, exercising or exchanging such
Convertible Securities.
"OUTSTANDING INTEREST FRACTION," as of any date, shall mean, with respect
to any class of Tracking Stock, a fraction the numerator of which is the
aggregate number of shares of such class of Tracking Stock outstanding on such
date and the denominator of which is the sum of (a) such aggregate number of
shares, (b) the Number of Shares Issuable with Respect to Retained Interest of
such class of Tracking Stock as of such date and (c) the aggregate Number of
Shares Issuable with Respect to Inter-Group Interest by all other Tracking
Groups in such Tracking Stock, if any, as of such date.
"PRE-81 PREFERRED SHARES," as of any date, shall mean the series of
Preferred Shares of the Corporation which are issued in the Merger in exchange
for series of Preferred Shares of TDS Iowa that were originally issued before
October 31, 1981, as identified in Section A of Article IV.
"PRE-DISTRIBUTION CONVERTIBLE SECURITIES" shall mean Convertible Securities
that are outstanding on the record date for the Distribution and are, prior to
such date, convertible into or exercisable or exchangeable for either Common
Shares or Series A Common Shares; PROVIDED, if the record date for the
Distribution of any of the Cellular Group Shares, Telecom Group Shares or Aerial
Group Shares is not the same date, the Board shall determine which, if any,
Convertible Securities (or proportion thereof) that are issued after the first
record date for any part of the Distribution, shall represent Pre-Distribution
Convertible Securities.
"POST-81 PREFERRED SHARES," as of any date, shall mean the series of
Preferred Shares of the Corporation which are issued in the Merger in exchange
for series of Preferred Shares of TDS Iowa that were originally issued after
October 31, 1981, as identified in Section A of Article IV.
"QUALIFYING SUBSIDIARY" or "QUALIFYING SUBSIDIARIES," as of any date, shall
mean a Subsidiary or Subsidiaries of the Corporation (a) in which (i) the
Corporation's ownership and voting interest is sufficient to satisfy the
requirements of the Internal Revenue Service for a distribution of the
Corporation's interest in such Subsidiary to the holders of Common Stock of the
Corporation that is tax-free to such holders or (ii) the Corporation owns,
directly or indirectly, all of the issued and outstanding capital stock and (b)
which hold(s) all of the assets and liabilities attributed to a Tracking Group.
"RELATED BUSINESS TRANSACTION" shall mean any Disposition of all or
substantially all of the properties and assets of a Tracking Group in which
the Corporation receives as proceeds of such Disposition primarily equity
securities (including, without limitation, capital stock, convertible
securities, partnership or limited partnership interests and other types of
equity securities, without regard to the voting power or contractual or other
management or governance rights related to such equity securities) of the
purchaser or acquiror of such assets and properties of such Tracking Group,
any entity which succeeds (by merger, formation of a joint venture enterprise
or otherwise) to such assets and properties of such Tracking Group or a third
party issuer, which purchaser, acquiror or other issuer is engaged or
proposes to engage primarily in one or more businesses similar or
complementary to the businesses conducted by such Tracking Group prior to
such Disposition, as determined in good faith by the Board.
"RETAINED INTEREST AVAILABLE DIVIDEND AMOUNT," as of any date, shall mean,
with respect to a Tracking Group, an amount (not less than zero) equal to the
product of (a) a fraction, the numerator of which is the Retained Interest
Fraction and the denominator of which is the Outstanding Interest Fraction with
respect to such Tracking Group multiplied by (b) the Available Dividend Amount
of such Tracking Group.
"RETAINED INTEREST FRACTION," as of any date, shall mean, with respect to
any class of Tracking Stock, a fraction the numerator of which is the Number of
Shares Issuable with Respect to Retained Interest of such class of Tracking
Stock as of such date and the denominator of which is the sum of (a) such Number
of Shares Issuable with Respect to Retained Interest as of such date, (b) the
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aggregate Number of Shares Issuable with Respect to Inter-Group Interest by all
other Tracking Groups in such Tracking Stock, if any, as of such date, and
(c) the aggregate number of shares of such class of Tracking Stock outstanding
as of such date.
"SHARES ISSUABLE TO THIRD PARTIES" shall have the meaning set forth in the
definition of "Number of Shares Issuable to Third Parties."
"SUBSIDIARY" shall mean, with respect to any person or entity, any
corporation or partnership 50% or more of whose outstanding voting securities or
partnership interests, as the case may be, are directly or indirectly owned by
such person or entity.
"TDS GROUP" shall mean, as of any date, that any shares of any class or
series of Tracking Stock have been issued and continue to be outstanding:
(a) the interest of the Corporation and all of its subsidiaries,
(including any successors thereto by merger, consolidation or sale of all
or substantially all of its assets) and their respective properties and
assets, other than (except as provided in paragraph (e) of this definition)
the interest of the Corporation and its subsidiaries in Aerial and its
subsidiaries, TDS Telecom and its subsidiaries, U.S. Cellular and its
subsidiaries, and any other subsidiaries attributed by the Board to a Group
other than the TDS Group (including any successors thereto by merger,
consolidation or sale of all or substantially all of its assets, whether or
not in connection with Related Business Transactions) and their respective
businesses, assets and liabilities;
(b) all businesses, assets and liabilities of the Corporation or any
of its subsidiaries to the extent attributed to the TDS Group by the Board,
whether or not such businesses, assets or liabilities are businesses,
assets and liabilities of the TDS Group or any of its subsidiaries (or a
successor as described in clause (a) of this sentence);
(c) all businesses, assets and liabilities contributed or otherwise
transferred to the TDS Group from any of the Tracking Groups;
(d) the interest of the Corporation or any of its subsidiaries in the
businesses, assets and liabilities acquired by the Corporation or any of
its subsidiaries for the TDS Group, as determined by the Board;
(e) a proportionate undivided interest in each and every business,
asset and liability attributed to a Tracking Group equal to the Retained
Interest Fraction of the TDS Group in such other Tracking Group; and
(f) such other businesses, assets and liabilities and such
adjustments to the foregoing as may be contemplated hereby or which may be
determined in good faith by the Board.
If a Retained Interest in any Tracking Group is then existing and if the
Corporation shall pay a dividend or make any other distribution with respect to
holders of Tracking Stock of such Tracking Group payable in cash, securities or
other property of the Corporation attributed to such Tracking Group, other than
shares of Tracking Stock, the TDS Group shall be deemed to hold an amount or
fair value thereof (as determined in good faith by the Board) of such cash,
securities or other property equal to the amount or fair value so distributed
multiplied by a fraction the numerator of which is such Tracking Group's
Retained Interest Fraction and the denominator of which is such Tracking Group's
Outstanding Interest Fraction in effect immediately prior to the record date for
such dividend or other distribution and, to the extent interest or dividends are
paid or other distributions are made on any securities other than shares of
Tracking Stock so distributed to the holders of such shares of Tracking Stock,
such Tracking Group shall no longer include a corresponding ratable amount or
fair value of the kind of assets paid as such interest or dividends or other
distributions in respect of such securities deemed to be held by the TDS Group.
From and after any transfer of cash, securities or other property from a
Tracking Group to the TDS Group, such Tracking Group shall no longer include the
cash, securities or other property so transferred and the TDS Group shall
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include such cash, securities or other property and from and after any transfer
of cash, securities or other property from the TDS Group to a Tracking Group,
the TDS Group shall no longer include the cash, securities or other property so
transferred and such Tracking Group shall include such cash, securities or other
property.
"TDS GROUP SHARES" shall mean the Series A Common Shares, Common Shares and
any issued Special Common Shares of the Corporation and any other shares of
capital stock designated by the Board as TDS Group Shares.
"TDS IOWA" shall mean Telephone and Data Systems, Inc., an Iowa
corporation.
"TDS TELECOM" shall mean TDS Telecommunications Corporation, a Delaware
corporation.
"TELECOM GROUP" shall mean, as of any date, that any shares of Telecom
Group Stock have been issued and continue to be outstanding:
(a) the interest of the Corporation or any of its subsidiaries in TDS
Telecom and its subsidiaries (including any successor thereto by merger,
consolidation or sale of all or substantially all of its assets, whether or
not in connection with a Related Business Transaction) and their respective
businesses, assets and liabilities, except any of such businesses, assets
or liabilities which have been attributed by the Board to another Group;
(b) all businesses, assets and liabilities of the Corporation or any
of its subsidiaries to the extent attributed to the Telecom Group by the
Board, whether or not such businesses, assets or liabilities are
businesses, assets and liabilities of TDS Telecom or any of its
subsidiaries (or a successor as described in clause (a) of this sentence);
(c) all businesses, assets and liabilities contributed or otherwise
transferred to the Telecom Group from the TDS Group or any of the other
Tracking Groups;
(d) the interest of the Corporation or any of its subsidiaries in the
businesses, assets and liabilities acquired by the Corporation or any of
its subsidiaries for the Telecom Group, as determined by the Board;
(e) a proportionate undivided interest in each and every business,
asset and liability attributed to another Tracking Group equal to the
Inter-Group Interest Fraction, if any, of the Telecom Group in such other
Tracking Group; and
(f) such other businesses, assets and liabilities and such
adjustments to the foregoing as may be contemplated hereby or which may be
determined in good faith by the Board.
If a Retained Interest in the Telecom Group is then existing and if the
Corporation shall pay a dividend or make any other distribution with respect to
Telecom Group Common Shares payable in cash, securities or other property of the
Corporation attributed to the Telecom Group, other than Telecom Group Common
Shares, the TDS Group shall be deemed to hold an amount or fair value thereof
(as determined in good faith by the Board) of such cash, securities or other
property equal to the amount or fair value so distributed multiplied by a
fraction the numerator of which is the Telecom Group's Retained Interest
Fraction and the denominator of which is the Telecom Group's Outstanding
Interest Fraction in effect immediately prior to the record date for such
dividend or other distribution and, to the extent interest or dividends are paid
or other distributions are made on any securities other than Telecom Group
Common Shares so distributed to the holders of Telecom Group Common Shares, the
Telecom Group shall no longer include a corresponding ratable amount or fair
value of the kind of assets paid as such interest or dividends or other
distributions in respect of such securities deemed to be held by the TDS Group.
If an Inter-Group Interest in the Telecom Group is then existing and if
the Corporation shall pay a dividend or make any other distribution with
respect to Telecom Group Common Shares payable in cash, securities or other
property of the Corporation attributed to the Telecom Group other than
Telecom Group Common Shares, the Tracking Group holding the Inter-Group
Interest in the Telecom Group shall be deemed to hold an amount or fair value
thereof (as determined in good faith by the Board) of such cash, securities
or other property equal to the amount or fair value so distributed multiplied
by a fraction the numerator of which is the Inter-Group Interest Fraction in
the Telecom Group in effect immediately prior to the record date for such
dividend or other distribution and the denominator of which is equal to the
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Telecom Group's Outstanding Interest Fraction in effect immediately prior to
the record date for such dividend or other distribution and, to the extent
interest or dividends are paid or other distributions are made on any
securities other than Telecom Group Common Shares so distributed to the
holders of Telecom Group Common Shares, the Telecom Group shall no longer
include a corresponding ratable amount or fair value of the kind of assets
paid as such interest or dividends or other distributions in respect of such
securities deemed to be held by the Tracking Group holding the Inter-Group
Interest in the Telecom Group.
From and after any transfer of cash, securities or other property from the
Telecom Group to the TDS Group or to another Tracking Group, the Telecom Group
shall no longer include the cash, securities or other property so transferred
and the TDS Group or such other Tracking Group, as the case may be, shall
include such cash, securities or other property, and from and after any transfer
of cash, securities or other property from the TDS Group or another Tracking
Group to the Telecom Group, the TDS Group or such other Tracking Group, as the
case may be, shall no longer include the cash, securities or other property so
transferred and the Telecom Group shall include such cash, securities or other
property.
"TELECOM GROUP COMMON SHARES" shall mean the TDS Telecommunications Group
Common Shares, par value $0.01 per share.
"TRACKING GROUP" shall mean the Aerial Group, the Cellular Group and the
Telecom Group, and any other business group designated as a Tracking Group by
the Board.
"TRACKING STOCK" shall mean the Aerial Group Common Shares, the Cellular
Group Common Shares and the Telecom Group Common Shares, and any other shares of
capital stock of the Corporation which the Board designates as Tracking Stock.
"TRADING DAY" shall mean each weekday other than a day on which the
relevant class of Common Stock of the Corporation is not traded on any
national securities exchange or quoted on the Nasdaq Stock Market or on the
over-the-counter market.
"U.S. CELLULAR" shall mean United States Cellular Corporation, a Delaware
corporation.
20. DETERMINATIONS BY BOARD. The Board of Directors shall make such
determinations with respect to the businesses, assets and liabilities to be
attributed to the Groups, the items of income and expenses for purposes of
determining the Corporation Earnings (Loss) attributable to the Groups, the
application of the provisions of this Article IV to transactions to be engaged
in by the Corporation and the powers, preferences and relative, participating,
optional and other special rights of the holders of the classes of Common Stock,
and the qualifications and restrictions thereon, provided by the Restated
Certificate of Incorporation of the Corporation, as may be or become necessary
or appropriate to the exercise of such powers, preferences and relative,
participating, optional and other special rights, including, without limiting
the foregoing, the determinations referred to in the following paragraphs of
this paragraph 20. A record of any such determination shall be filed with the
records of the actions of the Board of Directors.
(a) Upon any acquisition by the Corporation or its subsidiaries of
any assets or business, or any assumption of liabilities, outside of the
ordinary course of business of any then existing Group, the Board of
Directors shall determine whether such assets, business and liabilities (or
an interest therein) shall be for the benefit of one Group or that an
interest therein shall be partly for the benefit of one or more Groups.
(b) Upon any issuance of any shares of Tracking Stock at a time when
the Number of Shares Issuable with Respect to Retained Interest or the
Number of Shares Issuable with Respect to Inter-Group Interest is more than
zero, the Board of Directors shall determine, based on the use of the
proceeds of such issuance and any other relevant factors, whether all or
any part of the shares of such Tracking Stock so issued should reduce the
Number of Shares Issuable with Respect to Retained Interest or the Number
of Shares Issuable with Respect to Inter-Group Interest, as the case may
be.
(c) Upon any issuance by the Corporation or any subsidiary thereof of
any Convertible Securities that are convertible into or exchangeable or
exercisable for shares of a class of Tracking Stock, if at the time such
Convertible Securities are issued the Number of Shares Issuable with
Respect to Retained Interest or the Number of Shares Issuable with Respect
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to Inter-Group Interest is greater than zero, the Board of Directors shall
determine whether, upon conversion, exchange or exercise of such
Convertible Securities, the issuance of shares of such Tracking Stock
pursuant thereto shall, in whole or in part, reduce the Number of Shares
Issuable with Respect to Retained Interest or the Number of Shares Issuable
with Respect to Inter-Group Interest, taking into consideration the use of
the proceeds of such issuance of Convertible Securities and any other
relevant factors.
(d) Upon any repurchase by the Corporation or any subsidiary thereof
of shares of any class of Tracking Stock, the Board of Directors shall
determine, based on the source of funds used and any other relevant
factors, whether all or any part of the shares of such Tracking Stock so
purchased shall increase the Number of Shares Issuable with Respect to
Retained Interest or the Number of Shares Issuable with Respect to
Inter-Group Interest, as the case may be.
If the Board designates any new class or series of capital stock, the Board
shall make such determinations under this Restated Certificate of Incorporation
as the Board determines may be necessary or appropriate in connection therewith.
Subject to applicable law, any determinations made in good faith by the
Board under any provision of this Article IV or any certificate of designation
filed pursuant hereto, and any determinations with respect to any Group or the
rights of holders of any class or series of capital stock made pursuant to or in
furtherance of this Article IV, shall be final and binding on all shareholders.
ARTICLE V
The address of the registered office of the Corporation is Corporation
Trust Company, in the County of New Castle, and the name of its registered agent
at such address is Corporation Trust Center, 1209 Orange Street, Wilmington,
Delaware 19801.
ARTICLE VI
A. NUMBER AND CLASSES OF DIRECTORS. The number of directors of the
Corporation shall be fixed by or pursuant to the Bylaws of the Corporation, but
shall not be less than three. The directors shall be divided into three classes
and each class shall be as nearly equal in number as possible. The term of
office of directors of the second class shall expire at the annual meeting of
shareholders in 1998; that of the third class shall expire at the annual meeting
of shareholders in 1999; and that of the first class shall expire at the annual
meeting of shareholders in 2000. At each annual meeting after such
classification, the number of directors equal to the number of the class, the
term of which expired at the time of such meeting, shall be elected to hold
office until the third succeeding annual meeting of shareholders. If the number
of directors fixed by or pursuant to the Bylaws of the Corporation is changed at
any time, any newly created directorships or any decrease in directorships shall
be so apportioned among the classes by the Board so as to make all classes as
nearly equal in number as possible; PROVIDED, HOWEVER, that no decrease in the
number of directors shall shorten the term of any incumbent director.
B. REMOVAL. Any one or more of or all of the directors may be removed
with or without cause only by a vote of the holders of at least a majority of
the voting power of shares then entitled to vote in the election of such
directors.
C. BALLOTS. The election of directors need not be by written ballot
unless the Bylaws of the Corporation so provide.
ARTICLE VII
To the extent permitted by the DGCL or any other applicable law presently
or hereafter in effect, no director of the Corporation shall be personally
liable to the Corporation or its shareholders for monetary damages for breach of
any fiduciary duty owed to the Corporation or its shareholders; PROVIDED that
this provision shall not relieve a director from liability (a) for any breach of
the director's duty of loyalty to the Corporation or its shareholders, (b) for
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (c) for transactions from which the director derives
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an improper personal benefit or (d) under Section 174 of the DGCL. This
Article shall not apply to acts or omissions occurring prior to its
effectiveness. No amendment to, expiration of or repeal of this Article shall
apply to or have any effect on the liability or alleged liability of any
director of the Corporation for or with respect to any acts or omissions of such
director occurring prior to such amendment, expiration or repeal.
ARTICLE VIII
The Board of the Corporation, when evaluating any proposal or offer of
another party to (a) make a tender or exchange offer for any equity security of
the Corporation; (b) merge or consolidate the Corporation with another
corporation; or (c) purchase or otherwise acquire all or substantially all of
the properties and assets of the Corporation may, in connection with the
exercise of its judgment in determining what is in the best interests of the
Corporation and its shareholders, give due consideration to all factors the
directors deem relevant, including without limitation (i) the effects on the
customers of the Corporation or any of its subsidiaries or on such other
constituencies of the Corporation as the Board considers relevant under the
circumstances; (ii) not only the consideration being offered (after taking into
account corporate and shareholder taxes) in relation to the then current market
price for the Corporation's outstanding shares of capital stock, but also the
Board's estimate of the future value of the Corporation (including the
unrealized value of its properties and assets) as an independent going concern;
(iii) the purpose of the Corporation, and any of its subsidiaries, to provide
quality products and services on a long-term basis; and (iv) the long-term as
well as short-term interests of the Corporation and its shareholders, including
the possibility that such interests may be best served by the continued
independence of the Corporation. If, on the basis of such factors, the Board so
determines that a proposal or offer to acquire or merge the Corporation, or to
sell its assets, is not in the best interests of the Corporation, it may reject
the proposal or offer. If the Board determines to reject any such proposal or
offer, the Board shall have no obligation to facilitate, to remove any barriers
to, or to refrain from impeding the proposal or offer except as may be required
by applicable law. Except to the extent required by applicable law, the
consideration of any or all of such factors shall not be a violation of the
business judgment rule or of any duty of the directors to the shareholders or a
group of shareholders, even if the directors reasonably determine that any such
factor or factors outweigh the financial or other benefits to the Corporation or
a shareholder or group of shareholders.
ARTICLE IX
In furtherance and not in limitation of the powers conferred by statute,
the Board of Directors is expressly authorized to adopt, amend or repeal the
Bylaws of the Corporation.
ARTICLE X
Subject to the last sentence of this paragraph, each person who is or
was a director or officer of the Corporation, and each person who serves or
served at the request of the Corporation as a director or officer of another
enterprise, shall be indemnified by the Corporation in accordance with, and to
the fullest extent authorized by, the DGCL as it may be in effect from time to
time. The right of indemnity provided herein shall not be deemed exclusive of
any other rights to which any person may be entitled under any Bylaw, agreement,
vote of shareholders or directors, or otherwise. The Corporation may provide
indemnification to any such person, by agreement or otherwise, on such terms and
conditions as the Board of Directors may approve. Any agreement for
indemnification of any director, officer, employee or other person may provide
indemnification rights which are broader or otherwise differ from those set
forth herein. In furtherance and not in limitation of the powers conferred by
statute, the Board is expressly authorized to adopt, amend or repeal the Bylaws
of the Corporation regarding the manner and conditions under which
indemnification shall be provided hereunder by the Corporation and the extent
thereof from time to time as deemed appropriate by the Board in the best
interests of the Corporation.
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SECOND: The Board of Directors of the Corporation, at a meeting duly
called at which a quorum existed, duly adopted resolutions proposing and
approving and declaring advisable this Restated Certificate of Incorporation of
the Corporation.
THIRD: Pursuant to Section 228 of the DGCL, the adoption of this
Restated Certificate of Incorporation was consented to in writing by the sole
shareholder of the Corporation.
FOURTH: This Restated Certificate of Incorporation was duly adopted in
accordance with the provisions of Sections 242 and 245 of the General
Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, Telephone and Data Systems, Inc. has caused this
Restated Certificate to be signed by its President this 22nd day of May, 1998.
TELEPHONE AND DATA SYSTEMS, INC.
By: /s/ LeRoy T. Carlson, Jr.
-----------------------------
LeRoy T. Carlson, Jr.
PRESIDENT
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ATTACHMENT I
TO
RESTATED CERTIFICATE OF INCORPORATION
OF
TELEPHONE AND DATA SYSTEMS, INC.
INTRODUCTORY NOTE: This Attachment I to the Restated Certificate of
Incorporation of Telephone and Data Systems, Inc., a Delaware corporation ("TDS
Delaware"), describes the designations, rights, privileges and limitations of
the series of Preferred Shares of TDS Delaware which will be issued in the
Merger (as defined in the Restated Certificate of Incorporation) in exchange for
Preferred Shares of Telephone and Data Systems, Inc., an Iowa corporation ("TDS
Iowa"). Unless otherwise required by the context, for purposes of this
Attachment I, (i) references to dates of issuance of any series of Preferred
Shares shall mean the original dates of issuance of the related series of
Preferred Shares of TDS Iowa, (ii) references to conversion rates of any series
of Preferred Shares shall mean the conversion rates included in the original
certificate of designation of such series by TDS Iowa, without giving effect to
stock splits or other events after the original dates of issuance requiring
adjustment to such conversion rates, and (iii) references to all conversion or
redemption dates and periods shall be based on the original issuance date of
each series of Preferred Shares by TDS Iowa.
A. $6.00 CUMULATIVE VOTING SERIES A PREFERRED STOCK, $.01 PAR VALUE,
LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this preferred stock shall be "$6.00
Cumulative Voting Series A Preferred Stock" (hereinafter referred to as
"Series A Preferred Stock").
(b) DIVIDENDS-The holders of the Series A Preferred Stock shall be
entitled to receive, when and as declared by the board of directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of six dollars ($6.00) per annum per share and no more. The dividends, when
payable, shall be paid quarterly on the first days of January, April, July, and
October in each year, before any dividends shall be declared or paid upon or set
apart for the common stock of the Company for that year. Such dividends upon the
preferred stock shall be cumulative from the date of issue thereof so that if
dividends for any past dividend period at the rate of six dollars ($6.00) per
annum shall not have been paid thereon or declared and a sum sufficient for
payment thereof set apart, the deficiency shall be fully paid or set apart but
without interest, before any dividend shall be paid upon or set apart for the
common stock. Whenever the full dividend upon the preferred stock for all past
dividend periods shall have been paid and the full dividend thereon for the then
current dividend period shall have been paid or declared and a sum sufficient
for the payment thereof set apart, dividends upon the common stock may be
declared by the board of directors out of the remainder of the assets available
therefor.
(c) REDEMPTION-The Corporation may, at the option of the board of
directors, redeem the whole or any part of the outstanding Series A Preferred
Stock at any time after January 3, 1974. If such redemption is made, the holders
of any shares of Series A Preferred Stock redeemed shall be entitled to receive:
$105.00 per share if redeemed on or before January 3, 1975;
$104.50 if redeemed after January 3, 1975 but on or before January 3, 1976;
$104.00 if redeemed after January 3, 1976 but on or before January 3, 1977;
$103.50 if redeemed after January 3, 1977 but on or before January 3, 1978;
$103.00 if redeemed after January 3, 1978 but on or before January 3, 1979;
$102.50 if redeemed after January 3, 1979 but on or before January 3, 1980;
$102.00 if redeemed after January 3, 1980 but on or before January 3, 1981;
$101.50 if redeemed after January 3, 1981 but on or before January 3, 1982;
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$101.00 if redeemed after January 3, 1982 but on or before January 3, 1983;
$100.50 if redeemed after January 3, 1983 but on or before January 3, 1984;
$100.00 if redeemed after January 3, 1984;
plus an amount equal to all dividends accrued and unpaid to the redemption date.
Notice of election to redeem shall be mailed to each holder of stock to be
redeemed not less than thirty (30) days prior to the date upon which the stock
is to be redeemed. In case less than all of the outstanding Series A Preferred
Stock is to be redeemed, the amount to be redeemed and the method of effecting
such redemption, whether by lot or pro rata or otherwise, may be determined by
the board of directors. If on or before the redemption date named in such
notice, the funds necessary for such redemption shall have been set aside by the
Corporation so as to be available for payment on demand to the holders of the
preferred stock so called for redemption, then, notwithstanding that any
certificate of the preferred stock so called for redemption shall not have been
surrendered for cancellation, the dividends thereon shall cease to accrue from
and after the date of redemption so designated, and all rights with respect to
such preferred stock so called for redemption, including any right to vote or
otherwise participate in the determination of any proposed corporate action,
shall forthwith after such redemption date cease and determine, except only the
right of the holder to receive the redemption price therefor, but without
interest. Stock redeemed pursuant to the provisions hereof or any Series A
Preferred Stock purchased or otherwise acquired shall not be reissued but shall
be canceled and proceedings shall be taken in the manner prescribed by statute
to reduce the shares accordingly.
(d) VOTING RIGHTS-The holders of the shares of Series A Preferred Stock
shall be entitled to one vote for each share of such stock standing in the name
of the holder on the books of the Corporation and shall vote together with the
holders of the common stock of the Corporation as one class.
(e) PREEMPTIVE RIGHTS-No holder of any shares of Series A Preferred Stock
shall have any preemptive right to subscribe for or acquire additional shares of
the Corporation of the same or any other class, whether such shares be hereby or
hereafter authorized; and no holder of Series A Preferred Stock shall have any
preemptive right to acquire any shares which may be held in the treasury of the
Corporation; all such additional or treasury shares may be sold for such
consideration at such time and to such person or persons as the board of
directors may from time to time determine.
(f) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or involuntary,
the holders of the Series A Preferred Stock shall be entitled, before any assets
of the Corporation shall be distributed among or paid over to the holders of the
common stock, to receive out of the assets of the Company $100.00 per share of
Series A Preferred Stock. If upon any such dissolution, liquidation or winding
up, the assets of the Corporation available for payment to stockholders are not
sufficient to make payment in full to the holders of the Series A Preferred
Stock, payment shall be made to such holders ratably in accordance with the
number of shares held by them and, in case there shall then be more than one
series of the Preferred Stock ratably in accordance with the respective
distributive amount to which such holders shall be entitled.
B. $7.00 CUMULATIVE CONVERTIBLE VOTING SERIES B PREFERRED STOCK, $.01 PAR
VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this preferred stock shall be "$7.00
Cumulative Convertible Voting Series B Preferred Stock" (hereinafter referred to
as "Series B Preferred Stock").
(b) DIVIDENDS-The holders of the Series B Preferred Stock shall be
entitled to receive, when and as declared by the board of directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of seven dollars ($7.00) per annum per share and no more. The dividends,
when payable, shall be paid quarterly on the first days of March, June,
September and December in each year, before any dividends shall be declared or
paid upon or set apart for the common stock of the Company for that year. Such
dividends upon the Series B Preferred Stock shall be cumulative from the date of
issue thereof so that if dividends for any past dividend period at the rate of
seven dollars ($7.00) per annum shall not have been paid thereon or declared and
a sum sufficient for payment thereof set apart, the deficiency shall be fully
paid or set apart but without interest, before any dividend
I-2
<PAGE>
shall be paid upon or set apart for the common stock. Provided, however, that
no dividends shall be declared on the shares of any series of preferred stock
for any dividend period unless the full dividend for all prior dividend
periods shall have been declared or shall be declared at the same time upon
all preferred stock outstanding during such prior dividend periods, and
further provided, that no dividends shall be declared on the shares of any
series of preferred stock unless a dividend for the same period shall be
declared at the same time upon all preferred stock outstanding during said
period in like proportion to the dividend rate upon such shares. Whenever the
full dividend upon all the preferred stock for all past dividend periods
shall have been paid and the full dividend thereon for the then current
dividend period shall have been paid or declared and a sum sufficient for the
payment thereof set apart, dividends upon the common stock may be declared by
the board of directors out of the remainder of the assets available therefor.
(c) REDEMPTION-The Corporation may, at the option of the board of
directors, redeem the whole or any part of the outstanding Series B Preferred
Stock at any time commencing five years after the date of issuance. If such
redemption is made, the holders of any shares of Series B Preferred Stock
redeemed shall be entitled to receive $100 per share plus an amount equal to all
dividends accrued and unpaid to the redemption date.
Notice of election to redeem shall be mailed to each holder of Series B
Preferred Stock to be redeemed not less than thirty (30) days prior to the date
upon which such stock is to be redeemed. In case less than all of the
outstanding Series B Preferred Stock is to be redeemed, the amount to be
redeemed and the method of effecting such redemption, whether by lot or pro rata
or otherwise, may be determined by the board of directors. If on or before the
redemption date named in such notice, the funds necessary for such redemption
shall have been set aside by the Corporation so as to be available for payment
on demand to the holders of the Series B Preferred Stock so called for
redemption, then, notwithstanding that any certificate of the Series B Preferred
Stock so called for redemption shall not have been surrendered for cancellation,
the dividends thereon shall cease to accrue from and after the date of
redemption so designated, and all rights with respect to such Series B Preferred
Stock so called for redemption, including any right to vote or otherwise
participate in the determination of any proposed corporate action, shall
forthwith after such redemption date cease and terminate, except only the right
of the holder to receive the redemption price therefor, but without interest.
Stock redeemed pursuant to the provisions hereof or any Series B Preferred Stock
purchased or otherwise acquired shall not be reissued but shall be canceled and
proceedings shall be taken in the manner prescribed by statute to reduce the
shares accordingly.
(d) VOTING RIGHTS-The holders of the shares of Series B Preferred Stock
shall be entitled to one vote for each share of such stock standing in the name
of the holder on the books of the Corporation and shall vote together with the
holders of the common stock and the holders of other series of the preferred
stock of the Corporation as one class.
(e) PREEMPTIVE RIGHTS-No holder of any shares of Series B Preferred Stock
shall have any preemptive right to subscribe for or acquire additional shares of
the Corporation of the same or any other class or series, whether such shares be
hereby or hereafter authorized; and no holder of Series B Preferred Stock shall
have any preemptive right to acquire any shares which may be held in the
treasury of the Corporation; all such additional or treasury shares may be sold
for such consideration at such time and to such person or persons as the board
of directors may from time to time determine.
(f) CONVERSION-
(1) The Series B Preferred Stock shall be convertible into Common
Stock as hereinafter provided, and, when and as so converted, such Series B
Preferred Stock shall be canceled and retired and shall not be reissued as
such. Any holder of the Series B Preferred Stock may at any time prior to
five years from the date of issuance convert such stock into full shares of
the Common Stock of the Corporation at the rate of ten (10) shares of
Common Stock for each share of Series B Preferred Stock. On presentation
and surrender to the Corporation at its Offices of the certificates for
shares of the Series B Preferred Stock to be converted, the holder of such
stock shall be entitled to receive in exchange therefor certificates for
shares of the fully paid and non-assessable Common Stock of the Corporation
at the rate aforesaid, all under suitable regulations to be prescribed by
the board of directors of the Corporation. Conversion of Series B Preferred
Stock in the manner aforesaid shall not affect the right of the holder of
such stock to receive dividends accrued but unpaid on such shares as of the
dividend payment date immediately prior to conversion.
(2) The number of shares of Common Stock into which each share of
Series B Preferred Stock is convertible, shall be subject to adjustment
from time to time as in clauses (A) and (B) of this subparagraph (2):
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<PAGE>
(A) In case the Corporation shall (i) pay a dividend on its
Common Stock in shares of the Corporation, (ii) subdivide its
outstanding Common Stock, (iii) combine the outstanding Common Stock
into a smaller number of shares, or (iv) issue by reclassification of
its Common Stock (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
share of Series B Preferred Stock shall be entitled to receive upon
the conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective
retroactively with respect to conversions made subsequent to the
record date in the case of a dividend, and shall become effective on
the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth of a common share; provided, however, that
any adjustments which by reason of this clause (B) are not required to
be made shall be carried forward and taken into account in any
subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Stock, solely for the purpose of issue upon
conversion of shares of Series B Preferred Stock as herein provided, such
number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Series B Preferred Stock.
(4) Fractional shares of Common Stock shall not be issued upon
conversion of Series B Preferred Stock nor shall cash adjustments be made
for fractional shares upon such conversion.
(5) For the purposes of this paragraph (f), the term "Common Stock"
shall mean (A) the class of stock designated as the Common Stock of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such Common Stock consisting solely of change in par
value, or from par value to no par value, or from no par value to par
value.
(g) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or
involuntary, the holders of the Series B Preferred Stock shall be entitled,
before any assets of the Corporation shall be distributed among or paid over
to the holders of the common stock, to receive out of the assets of the
Company $100.00 per share of Series B Preferred Stock. If upon any such
dissolution, liquidation or winding up, the assets of the Corporation
available for payment to stockholders are not sufficient to make payment in
full to the holders of the Series B Preferred Stock, payment shall be made to
such holders ratably in accordance with the number of shares held by them
and, in case there shall then be more than one series of the Preferred Stock
outstanding at that time, ratably in accordance with the respective
distributive amount to which such holders shall be entitled.
D. 6.00 CUMULATIVE CONVERTIBLE VOTING SERIES D PREFERRED STOCK, $.01 PAR
VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this preferred stock shall be $6.00
Cumulative Convertible Voting Series D Preferred Stock (hereinafter referred to
as "Series D Preferred Stock").
(b) DIVIDENDS-The holders of the Series D Preferred Stock shall be
entitled to receive, when and as declared by the board of directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of six dollars ($6.00) per annum per share and no more. The dividends, when
payable, shall be paid quarterly on the first days of March, June, September,
and December in each year, before any dividends shall be declared or paid upon
or set apart for the common stock of the Company for that year. Such dividends
upon the Series D Preferred Stock shall be cumulative from the date of issue
thereof so that if dividends for any past dividend period at the rate of six
dollars ($6.00) per annum shall not have been paid thereon or declared and a sum
sufficient for payment thereof set apart, the deficiency shall be fully paid or
set apart but without interest, before any dividend shall be paid upon or set
apart for the common stock. Provided, however, that no dividends shall be
declared on the shares of any series of preferred stock for any dividend period
unless the full dividend for all prior dividend periods shall have been
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<PAGE>
declared or shall be declared at the same time upon all preferred stock
outstanding during said prior dividend periods, and further provided, that no
dividends shall be declared on the shares of any series of preferred stock
unless a dividend for the same period shall be declared at the same time upon
all preferred stock outstanding during said period in like proportion to the
dividend rate upon such shares. Whenever the full dividend upon all the
preferred stock for all past dividend periods shall have been paid and the
full dividend thereon for the then current dividend period shall have been
paid or declared and a sum sufficient for the payment thereof set apart,
dividends upon the common stock may be declared by the board of directors out
of the remainder of the assets available therefor.
(c) REDEMPTION-The Corporation may, at the option of the board of
directors, redeem the whole or any part of the outstanding Series D Preferred
Stock at any time commencing ten years after the date of issuance. If such
redemption is made, the holders of any shares of Series D Preferred Stock
redeemed shall be entitled to receive $100 per share plus an amount equal to all
dividends accrued and unpaid to the redemption date.
Notice of election to redeem shall be mailed to each holder of Series D
Preferred Stock to be redeemed not less than thirty (30) days prior to the date
upon which such stock is to be redeemed. In case less than all of the
outstanding Series D Preferred Stock is to be redeemed, the amount to be
redeemed and the method of effecting such redemption, whether by lot or pro rata
or otherwise, may be determined by the board of directors. If on or before the
redemption date named in such notice, the funds necessary for such redemption
shall have been set aside by the Corporation so as to be available for payment
on demand to the holders of the Series D Preferred Stock so called for
redemption then, notwithstanding that any certificate of the Series D Preferred
Stock so called for redemption shall not have been surrendered for cancellation,
the dividends thereon shall cease to accrue from and after the date of
redemption so designated, and all rights with respect to such Series D Preferred
Stock so called for redemption, including any right to vote or otherwise
participate in the determination of any proposed corporate action, shall
forthwith after such redemption date cease and terminate, except only the right
of the holder to receive the redemption price therefor, but without interest.
Stock redeemed pursuant to the provisions hereof or any Series D Preferred Stock
purchased or otherwise acquired shall not be reissued but shall be canceled and
proceedings shall be taken in the manner prescribed by statute to reduce the
shares accordingly.
(d) VOTING RIGHTS-The holders of the shares of Series D Preferred Stock
shall be entitled to one vote for each share of such stock standing in the name
of the holder on the books of the Corporation and shall vote together with the
holders of the common stock and the holders of other series of the preferred
stock of the Corporation as one class.
(e) PREEMPTIVE RIGHTS-No holder of any shares of Series D Preferred Stock
shall have any preemptive right to subscribe for or acquire additional shares of
the Corporation of the same or any other class or series, whether such shares be
hereby or hereafter authorized; and no holder of Series D Preferred Stock shall
have any preemptive right to acquire any shares which may be held in the
treasury of the Corporation; all such additional or treasury shares may be sold
for such consideration at such time and to such person or persons as the board
of directors may from time to time determine.
(f) CONVERSION-
(1) The Series D Preferred Stock shall be convertible into Common
Stock as hereinafter provided and, when and as so converted, such Series D
Preferred Stock shall be canceled and retired and shall not be reissued as
such. Any holder of the Series D Preferred Stock may at any time
commencing two (2) years and terminating upon the expiration of ten (10)
years from the date of issuance convert such stock into full shares of the
Common Stock of the Corporation at the rate of ten (10) shares of Common
Stock for each share of Series D Preferred Stock. On presentation and
surrender to the Corporation at its offices of the certificates for shares
of the Series D Preferred Stock to be converted, the holder of such stock
shall be entitled to receive in exchange therefor certificates for shares
of the fully paid and non-assessable Common Stock of the Corporation at
the rate aforesaid, all under suitable regulations to be prescribed by the
board of directors of the Corporation. Conversion of Series D Preferred
Stock in the manner aforesaid shall not affect the right of the holder of
such stock to receive dividends accrued but unpaid on such shares as of
the dividend payment date immediately prior to conversion.
(2) The number of shares of Common Stock into which each share of
Series D Preferred Stock is convertible, shall be subject to adjustment
from time to time as in clauses (A) and (B) of this subparagraph (2):
I-5
<PAGE>
(A) In case the Corporation shall (i) pay a dividend on its
Common Stock in shares of the Corporation, (ii) subdivide its
outstanding Common Stock, (iii) combine the outstanding Common Stock
into a smaller number of shares, or (iv) issue by reclassification of
its Common Stock (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
share of Series D Preferred Stock shall be entitled to receive upon
the conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective
retroactively with respect to conversions made subsequent to the
record date in the case of a dividend, and shall become effective on
the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth of a share of Common Stock; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Stock, solely for the purpose of issue upon
conversion of shares of Series D Preferred Stock as herein provided, such
number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Series D Preferred Stock.
(4) Fractional shares of Common Stock shall not be issued upon
conversion of Series D Preferred Stock nor shall cash adjustments be made
for fractional shares upon such conversion.
(5) For the purposes of this paragraph (f), the term "Common Stock"
shall mean (A) the class of stock designated as the Common Stock of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such Common Stock consisting solely of change in par
value, or from par value to no par value, or from no par value to par
value.
(g) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or
involuntary, the holders of the Series D Preferred Stock shall be entitled,
before any assets of the Corporation shall be distributed among or paid over
to the holders of the common stock, to receive out of the assets of the
Company $100.00 per share of Series D Preferred Stock. If upon any such
dissolution, liquidation or winding up, the assets of the Corporation
available for payment to stockholders are not sufficient to make payment in
full to the holders of the Series D Preferred Stock, payment shall be made to
such holders ratably in accordance with the number of shares held by them
and, in case there shall then be more than one series of the Preferred Stock
outstanding at that time, ratably in accordance with the respective
distributive amount to which such holders shall be entitled.
G. $7.00 CUMULATIVE CONVERTIBLE VOTING SERIES G PREFERRED STOCK, $.01 PAR
VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this preferred stock shall be $7.00
Cumulative Convertible Voting Series G Preferred Stock (hereinafter referred to
as "Series G Preferred Stock").
(b) DIVIDENDS-The holders of the Series G Preferred Stock shall be
entitled to receive, when and as declared by the Board of Directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of seven dollars ($7.00) per annum per share. The dividends, when payable,
shall be paid quarterly on the first days of March, June, September and December
in each year, before any dividends shall be declared or paid upon or set apart
for the common stock of the Company for that year. Such dividends upon the
Series G Preferred Stock shall be cumulative from the date of issue thereof so
that if dividends for any past dividend period at the rate of seven dollars
($7.00) per annum shall not have been paid thereon or declared and a sum
sufficient for payment thereof set apart, the deficiency shall be fully paid or
set apart before any dividend shall be paid upon or set apart for the common
stock. Provided however, that no dividends shall be declared on the shares of
any series of preferred stock for any dividend period unless the full dividend
for all prior dividend periods shall have been declared or shall be declared at
the same time upon all preferred stock outstanding during said prior dividend
periods, and further provided, that no dividends shall be declared on the shares
of any series of preferred stock unless a dividend for the same period shall be
declared at the
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<PAGE>
same time upon all preferred stock outstanding during said period in like
proportion to the dividend rate upon such shares. Whenever the full dividend
upon all the preferred stock for all past dividend periods shall have been
paid and the full dividend thereon for the then current dividend period shall
have been paid or declared and a sum sufficient for the payment thereof set
apart, dividends upon the common stock may be declared by the Board of
Directors out of the remainder of the assets available therefor.
(c) REDEMPTION-Commencing ten years after the date of issuance, the
Corporation may, at the option of the Board of Directors, redeem in any one year
all or any part of the outstanding shares of Series G Preferred Stock at a price
of $100.00 per share.
Notice of redemption shall be mailed to each holder of Series G Preferred
Stock to be redeemed not less than thirty (30) days prior to the date upon which
the stock is to be redeemed. In case less than all of the outstanding Series G
Preferred Stock is to be redeemed, the amount to be redeemed and the method of
effecting such redemption, whether by lot or pro rata or otherwise, may be
determined by the Board of Directors. If on or before the redemption date named
in such notice, the funds necessary for such redemption shall have been set
aside by the Corporation so as to be available for payment on demand to the
holders of the Series G Preferred Stock so called for redemption then,
notwithstanding that any certificate of the Series G Preferred Stock so called
for redemption shall not have been surrendered for cancellation, the dividends
thereon shall cease to accrue from and after the date of redemption so
designated and all rights with respect to such Series G Preferred Stock so
called for redemption, including any right to vote or otherwise participate in
the determination of any proposed corporate action, shall forthwith after such
redemption date cease and determine, except only the right of the holder to
receive the redemption price therefor, but with interest on the unpaid dividends
calculated only until the date of redemption and without any further interest
whatsoever. Stock redeemed pursuant to the provisions hereof or any Series G
Preferred Stock purchased or otherwise acquired by the Corporation shall not be
reissued but shall be canceled and proceedings shall be taken in the manner
prescribed by statute to reduce the shares accordingly.
(d) VOTING RIGHTS-The holders of the shares of Series G Preferred Stock
shall be entitled to one vote for each share of such stock standing in the name
of the holder on the books of the Corporation and shall vote together with the
holders of the common stock and the holders of other series of the preferred
stock of the Corporation as one class.
(e) PREEMPTIVE RIGHTS-No holder of any shares of Series G Preferred Stock
shall have any preemptive right to subscribe for or acquire additional shares of
the Corporation of the same or any other class or series, whether such shares be
hereby or hereafter authorized; and no holder of Series G Preferred Stock shall
have any preemptive right to acquire any shares which may be held in the
treasury of the Corporation; all such additional or treasury shares may be sold
for such consideration at such time and to such person or persons as the Board
of Directors may from time to time determine, unless otherwise restricted by the
terms of this statement of designations, powers and preferences.
(f) CONVERSION-
(1) The Series G Preferred Stock shall be convertible into Common
Stock as hereinafter provided and, when and as so converted, such Series G
Preferred Stock shall be canceled and retired and shall not be reissued as
such.
(2) Any holder of the Series G Preferred Stock, at any time
commencing immediately upon the issuance of the Series G Preferred Stock
and terminating upon the expiration of ten years from the date of issuance,
may convert such stock into full shares of the Common Stock of the
Corporation at the rate of nine (9) shares of Common Stock for each share
of Series G Preferred Stock upon 90 days written notice.
(3) On presentation and surrender to the Corporation at its offices
of the certificates for shares of the Series G Preferred Stock to be
converted, the holder of such stock shall be entitled to receive in
exchange therefor certificates for shares of the fully paid and
non-assessable Common Stock of the Corporation at the rate aforesaid, all
under suitable regulations to be prescribed by the Board of Directors of
the Corporation. Conversion of Series G Preferred Stock in the manner
aforesaid shall not affect the right of the holder of such stock to receive
dividends accrued but unpaid on such shares as of the dividend payment date
immediately prior to conversion.
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<PAGE>
(4) The number of shares of Common Stock into which each share of
Series G Preferred Stock is convertible shall be subject to adjustment from
time to time as in clauses (A) and (B) of this subparagraph (4):
(A) In case the Corporation shall (i) pay a dividend on its
Common Stock in shares of the Corporation, (ii) subdivide its
outstanding Common Stock, (iii) combine the outstanding Common Stock
into a smaller number of shares, or (iv) issue by reclassification of
its Common Stock (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
share of Series G Preferred Stock shall be entitled to receive upon
the conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective on
the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth of a common share; provided, however, that
any adjustments which by reason of this clause (B) are not required to
be made shall be carried forward and taken into account by any
subsequent adjustment.
(5) The Corporation shall at all times reserve and keep available out
of its authorized Common Stock solely for the purpose of issue upon
conversion of shares of Series G Preferred Stock as herein provided, such
number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Series G Preferred Stock.
(6) Fractional shares of Common Stock shall not be issued upon
conversion of Series G Preferred Stock nor shall cash adjustments be made
for fractional shares upon such conversion.
(7) For the purpose of this paragraph (f), the term "Common Stock"
shall mean (A) the class of stock designated as the Common Stock of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such Common Stock consisting solely of change in par
value, or from par value to no par value, or from no par value to par
value.
(g) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or
involuntary, the holders of the Series G Preferred Stock shall be entitled,
before any assets of the Corporation shall be distributed among or paid over
to the holders of the common stock, to receive out of the assets of the
Company $100.00 per share of Series G Preferred Stock. If upon any such
dissolution, liquidation or winding up, the assets of the Corporation
available for payment to stockholders are not sufficient to make payment in
full to the holders of the Series G Preferred Stock, payment shall be made to
such holders ratably in accordance with the number of shares held by them
and, in case there shall then be more than one series of the Preferred Stock
outstanding at that time, ratably in accordance with the respective
distributive amount to which such holders shall be entitled.
H. $7.00 CUMULATIVE CONVERTIBLE VOTING SERIES H PREFERRED STOCK, $.01 PAR
VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this preferred stock shall be $7.00
Cumulative Convertible Voting Series H Preferred Stock (hereinafter referred to
as "Series H Preferred Stock").
(b) DIVIDENDS-The holders of the Series H Preferred Stock shall be
entitled to receive, when and as declared by the Board of Directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of seven dollars ($7.00) per annum per share. The dividends, when payable,
shall be paid quarterly on the first days of March, June, September and
December in each year, before any dividends shall be declared or paid upon or
set apart for the common stock of the Company for that year. Such dividends upon
the Series H Preferred Stock shall be cumulative from the date of issue thereof
so that if dividends for any past dividend period at the rate of seven dollars
($7.00) per annum shall not have been paid thereon or declared and a sum
sufficient for payment thereof set apart, the deficiency shall be fully paid or
set apart before any dividend shall be paid upon or set apart for the common
stock. Provided, however, that no dividends shall be declared on the shares of
any series of preferred stock for any
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<PAGE>
dividend period unless the full dividend for all prior dividend periods shall
have been declared or shall be declared at the same time upon all preferred
stock outstanding during said prior dividend periods, and further provided,
that no dividends shall be declared on the shares of any series of preferred
stock unless a dividend for the same period shall be declared at the same
time upon all preferred stock outstanding during said period in like
proportion to the dividend rate upon such shares. Whenever the full dividend
upon all the preferred stock for all past dividend periods shall have been
paid and the full dividend thereon for the then current dividend period shall
have been paid or declared and a sum sufficient for the payment thereof set
apart, dividends upon the common stock may be declared by the Board of
Directors out of the remainder of the assets available therefor.
(c) REDEMPTION-
(1) Unless the holder of Series H Preferred Stock elects not to have
his shares redeemed in any one or more years in accordance with this
subparagraph (c)(1) by so informing the Corporation at any time or times in
writing (which election, if made, shall be irrevocable and shall forever
bar redemption of the Series H Preferred Stock except in accordance with
the provisions of subparagraph (c)(2)), the Corporation will redeem more
than twenty percent of the shares of Series H Preferred Stock then held by
each holder of Series H Preferred Stock at an aggregate price of $119.06
per share on the anniversary of the date of issuance of the Series H
Preferred Stock in the following years: 1981, 1984, 1987 and 1989 through
and including 1995.
(2) Beginning on the twenty-first anniversary of the date of issuance
of the Series H Preferred Stock, the holders of Series H Preferred Stock
shall have the right, at their option, to have the Corporation redeem any
or all of the outstanding shares of Series H Preferred Stock at a price of
$100.00 per share.
(3) If, on or before the applicable redemption date named above, the
funds necessary for such redemption shall have been set aside by the
Corporation so as to be available for payment on demand to the holders of
the Series H Preferred Stock so called for redemption, then,
notwithstanding that any certificate of the Series H Preferred Stock so
called for redemption shall not have been surrendered for cancellation, the
dividends thereon shall cease to accrue from and after the date of
redemption so designated and all rights with respect to such Series H
Preferred Stock so called for redemption, including any right to vote or
otherwise participate in the determination of any proposed corporate
action, shall forthwith after such redemption date cease and determine,
except only the right of the holder to receive the redemption price
therefor, but with interest on the unpaid dividends calculated only until
the date of redemption and without any further interest whatsoever.
(4) Stock redeemed pursuant to any of the provisions of paragraph (c)
or any Series H Preferred Stock purchased or otherwise acquired by the
Corporation shall not be reissued but shall be canceled and proceedings
shall be taken in the manner prescribed by statute to reduce the shares
accordingly.
(d) VOTING RIGHTS-The holders of the shares of Series H Preferred Stock
shall be entitled to one vote for each share of such stock standing in the name
of the holder on the books of the Corporation and shall vote together with the
holders of the common stock and the holders of other series of the preferred
stock of the Corporation as one class.
(e) PREEMPTIVE RIGHTS-No holder of any shares of Series H Preferred Stock
shall have any preemptive right to subscribe for or acquire additional shares of
the Corporation of the same or any other class or series, whether such shares be
hereby or hereafter authorized; and no holder of Series H Preferred Stock shall
have any preemptive right to acquire any shares which may be held in the
treasury of the Corporation; all such additional or treasury shares may be sold
for such consideration at such time and to such person or persons as the Board
of Directors may from time to time determine, unless otherwise restricted by the
terms of this statement of designations, powers and preferences.
(f) CONVERSION-
(1) The Series H Preferred Stock shall be convertible into Common
Stock as hereinafter provided and, when and as so converted, such Series H
Preferred Stock shall be canceled and retired and shall not be reissued as
such.
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<PAGE>
(2) Any holder of the Series H Preferred Stock, at any time
commencing immediately upon the issuance of the Series H Preferred Stock
and terminating upon the expiration of ten years from the date of issuance,
may convert such stock into full shares of the Common Stock of the
Corporation at the rate of nine (9) shares of Common Stock for each share
of Series H Preferred Stock upon 90 days written notice to the Corporation
by the holder of the Series H Preferred Stock. The Corporation, at its
option, may consent to shorter notice.
(3) On presentation and surrender to the Corporation at its offices
of the certificates for shares of the Series H Preferred Stock to be
converted, the holder of such stock shall be entitled to receive in
exchange therefor certificates for shares of the fully paid and
non-assessable Common Stock of the Corporation at the rate aforesaid, all
under suitable regulations to be prescribed by the Board of Directors of
the Corporation. Conversion of Series H Preferred Stock in the manner
aforesaid shall not affect the right of the holder of such stock to
receive dividends accrued but unpaid on such shares as of the dividend
payment date immediately prior to conversion.
(4) The number of shares of Common Stock into which each share of
Series H Preferred Stock is convertible shall be subject to adjustment from
time to time as in clauses (A) and (B) of this subparagraph (4):
(A) In case the Corporation shall (i) pay a dividend on its
Common Stock in shares of the Corporation, (ii) subdivide its
outstanding Common Stock, (iii) combine the outstanding Common Stock
into a smaller number of shares, or (iv) issue by reclassification of
its Common Stock (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
share of Series H Preferred Stock shall be entitled to receive upon
the conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective on
the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth of a common share; provided, however, that
any adjustments which by reason of this clause (B) are not required to
be made shall be carried forward and taken into account by any
subsequent adjustment.
(5) The Corporation shall at all times reserve and keep available out
of its authorized Common Stock solely for the purpose of issue upon
conversion of shares of Series H Preferred Stock as herein provided, such
number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Series H Preferred Stock.
(6) Fractional shares of Common Stock shall not be issued upon
conversion of Series H Preferred Stock nor shall cash adjustments be made
for fractional shares upon such conversion.
(7) For the purposes of this paragraph (f), the term "Common Stock"
shall mean (A) the class of stock designated as the Common Stock of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such Common Stock consisting solely of change in par
value, or from par value to no par value, or from no par value to par
value.
(g) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or
involuntary, the holders of the Series H Preferred Stock shall be entitled,
before any assets of the Corporation shall be distributed among or paid over
to the holders of the Common Stock, to receive out of the assets of the
Company $100.00 per share of Series H Preferred Stock. If upon any such
dissolution, liquidation or winding up, the assets of the Corporation
available for payment to stockholders are not sufficient to make payment in
full to the holders of the Series H Preferred Stock, payment shall be made to
such holders ratably in accordance with the number of shares held by them
and, in case there shall then be more than one series of the Preferred Stock
outstanding at that time, ratably in accordance with the respective
distributive amount to which such holders shall be entitled.
I-10
<PAGE>
N. $8.00 CUMULATIVE CONVERTIBLE AND REDEEMABLE VOTING SERIES N PREFERRED
STOCK, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "$8.00 Cumulative Convertible and Redeemable Voting Series N Preferred
Shares" (hereinafter referred to as the "Series N Preferred Shares").
(b) DIVIDENDS-The holders of the Series N Preferred Shares shall be
entitled to receive, when and as declared by the board of directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of eight dollars ($8.00) per annum per share and no more. The dividends,
when payable, shall be paid quarterly on the first days of March, June,
September and December in each year, before any dividends shall be declared or
paid upon or set apart for the Common Shares or Series A Common Shares of the
Corporation for that quarter. Such dividends upon the Series N Preferred Shares
shall be cumulative from the date of issue thereof so that if dividends for any
past dividend period at the rate of eight dollars ($8.00) per annum shall not
have been paid thereon or declared and a sum sufficient for payment thereof set
apart, the deficiency shall be fully paid or set apart but without interest,
before any dividend shall be paid upon or set apart for the Common Shares or
Series A Common Shares; provided, however, that no dividends shall be declared
on the shares of any series of preferred stock for any dividend period unless
the full dividend for all prior dividend periods shall have been declared or
shall be declared at the same time upon all preferred stock outstanding during
such prior dividend periods, and further provided that no dividends shall be
declared on the shares of any series of preferred stock unless a dividend for
the same period shall be declared at the same time upon all preferred stock
outstanding during said period in like proportion to the dividend rate upon such
shares. Whenever the full dividend upon all the series of the preferred stock
for all past dividend periods shall have been paid and the full dividend thereon
for the then current dividend period shall have been paid or declared and a sum
sufficient for the payment thereof set apart, dividends upon the Common Shares
or Series A Common Shares may be declared by the board of directors out of the
remainder of the assets available therefor.
(c) REDEMPTION-
(1) Unless such shares have been converted pursuant to paragraph
(f) hereof prior to the sixth anniversary of the date of issue thereof, the
Corporation shall, beginning with the seventh anniversary of the date of
issue thereof, and annually thereafter on each subsequent anniversary of
the date of issue thereof, redeem one-fourteenth of the number of Series N
Preferred Shares outstanding on the sixth anniversary of the date of issue
thereof, until all such shares have been redeemed, and the holders thereof
shall be entitled to receive $100.00 per share plus an amount equal to all
dividends accrued and unpaid thereon to the redemption date.
(2) Notice of any redemption shall be mailed to each holder of
Series N Preferred Shares to be redeemed not less than thirty (30) days
prior to the date upon which such stock is to be redeemed. If on or before
the redemption date specified in such notice, the funds necessary for such
redemption shall have been set aside by the Corporation so as to be
available for payment on demand to the holders of Series N Preferred Shares
so called for redemption then, notwithstanding that any certificate
representing Series N Preferred Shares so called for redemption shall not
have been surrendered for cancellation, the dividends thereon shall cease
to accrue from and after the date of such redemption so specified, and all
rights with respect to such Series N Preferred Shares so called for
redemption, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall forthwith after such
redemption date cease and terminate, except only the right of the holder to
receive the redemption price therefor, but without interest. Series N
Preferred Shares redeemed pursuant to the provisions hereof or any such
shares purchased or otherwise acquired shall not be reissued but shall be
canceled and proceedings shall be taken in the manner prescribed by statute
to reduce the number of outstanding Series N Preferred Shares accordingly.
(d) VOTING RIGHTS-The holders of Series N Preferred Shares shall be
entitled to one vote for each share of such stock standing in the name of the
holder on the books of the Corporation and shall vote together with the holders
of the common stock and the holders of other series of the preferred stock of
the Corporation as one class.
(e) PREEMPTIVE RIGHTS-No holder of any Series N Preferred Shares shall
have any preemptive right to subscribe for or acquire additional shares of the
Corporation of the same or any other class or series, whether such shares be
hereby or hereafter authorized; and no holder of Series N Preferred Shares shall
have any preemptive right to acquire any
I-11
<PAGE>
shares which may be held in the treasury of the Corporation; all such
additional or treasury shares may be sold for such consideration at such time
and to such person or persons as the board of directors may from time to time
determine.
(f) CONVERSION-
(1) The Series N Preferred Shares shall be convertible into the
Corporation's Common Shares as hereinafter provided, and when and as so
converted, such Series N Preferred Shares shall be canceled and retired and
shall not be reissued as such. Commencing upon the issuance and terminating
at the close of business on the third anniversary thereof, the Series N
Preferred Shares may be converted, upon thirty (30) days' written notice to
the Corporation into Common Shares of the Corporation at the rate of ten
(10) Common Shares for each Series N Preferred Share. Thereafter, until the
close of business on the sixth anniversary of the date of issue, the
Series N Preferred Shares may be converted, upon thirty (30) days' written
notice to the Corporation, into Common Shares of the Corporation at the
rate of nine (9) Common Shares for each Series N Preferred Share. On
presentation and surrender to the Corporation at its offices of the
certificates representing Series N Preferred Shares to be converted, the
holder thereof shall be entitled to receive in exchange therefor
certificates for the fully paid and non-assessable Common Shares of the
Corporation at the rate aforesaid, all under suitable regulations to be
prescribed by the board of directors of the Corporation. Conversion of
Series N Preferred Shares in the manner aforesaid shall not affect the
right of the converting holder thereof to receive dividends accrued but
unpaid thereon as of the dividend payment date immediately prior to
conversion.
(2) The number of Common Shares into which each Series N Preferred
Shares is convertible shall be subject to adjustment from time to time as
set forth in clauses (A) and (B) of this subparagraph (2):
(A) In case the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation, (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares or (iv) issue by reclassification of
its Common Shares (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
Series N Preferred Share shall be entitled to receive upon the
conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective
retroactively with respect to conversions made subsequent to the
record date in the case of a dividend, and shall become effective on
the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth (1/10) of a Common Shares; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account by any subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series N Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series N Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series N Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For the purposes of this paragraph (f), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such class consisting solely of a change in par value,
or a change from no par value to par value.
(g) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or involuntary,
the holders of the Series N Preferred Shares shall be entitled, before any
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<PAGE>
assets of the Corporation shall be distributed among or paid over to the holders
of Common Shares or Series A Common Shares, to receive out of the assets of the
Corporation $100.00 per Series N Preferred Share. If upon any such dissolution,
liquidation or winding up, the assets of the Corporation available for payment
to stockholders are not sufficient to make payment in full to the holders of the
Series N Preferred Shares, payment shall be made to such holders ratably in
accordance with the number of shares held by them, and in case there shall then
be more than one series of the preferred stock outstanding at that time, ratably
in accordance with the respective distributive amount to which such holders
shall be entitled.
O. $9.00 CUMULATIVE CONVERTIBLE AND REDEEMABLE VOTING SERIES O PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "$9.00 Cumulative Convertible and Redeemable Voting Series O Preferred
Shares" (hereinafter referred to as the "Series O Preferred Shares").
(b) DIVIDENDS-The holders of the Series O Preferred Shares shall be
entitled to receive, when and as declared by the board of directors of the
Corporation, out of any assets of the Corporation available for dividends
pursuant to the laws of the State of Delaware, preferential dividends at the
rate of nine dollars ($9.00) per annum per share and no more. The dividends,
when payable, shall be paid quarterly on the first days of March, June,
September and December in each year (prorated if the period such stock is
outstanding prior to the first quarterly dividend date is less than a calendar
quarter), before any dividends shall be declared or paid upon or set apart for
the Common Shares or Series A Common Shares of the Corporation for that quarter.
Such dividends upon the Series O Preferred Shares shall be cumulative from the
date of issue thereof so that if dividends for any past dividend period at the
rate of nine dollars ($9.00) per annum per share shall not have been paid
thereon or declared and a sum sufficient for payment thereof set apart, the
deficiency shall be fully paid or set apart but without interest, before any
dividend shall be paid upon or set apart for the Common Shares or Series A
Common Shares; provided, however, that no dividends shall be declared on the
shares of any series of preferred stock for any dividend period unless the full
dividend for all prior dividend periods shall have been declared or shall be
declared at the same time upon all preferred stock outstanding during such prior
dividend periods, and further provided that no dividends shall be declared on
the shares of any series of preferred stock unless a dividend for the same
period shall be declared at the same time upon all preferred stock outstanding
during said period in like proportion to the dividend rate upon such shares.
Whenever the full dividend upon all series of preferred stock for all past
dividend periods shall have been paid and the full dividend thereon for the then
current dividend period shall have been paid or declared and a sum sufficient
for the payment thereof set apart, dividends upon the Common Shares or Series A
Common Shares may be declared by the board of directors out of the remainder of
the assets available therefor.
(c) REDEMPTION-
(1) Unless such shares have been converted pursuant to paragraph
(f) hereof prior to January 1, 1990, the Corporation may, at its option
from time to time and in such amounts as it may determine, redeem the
Series O Preferred Shares for $100.00 per share plus an amount equal to all
dividends accrued and unpaid thereon to the redemption date.
(2) Unless such shares have been converted pursuant to paragraph
(f) hereof prior to January 1, 1990, the holder of Series O Preferred
Shares may, at the holder's option, during the period commencing January 1,
1990 and ending December 31, 1999, elect to have redeemed in any one year
as much as one-third (1/3) of the number of Series O Preferred Shares held
by such person on January 1, 1990.
(3) Notice of an election under either of the redemption provisions
in subparagraphs (c)(1) and (c)(2) above shall be mailed (A) in case of a
redemption at the election of the Corporation to each holder of Series O
Preferred Shares to be redeemed or (B) in the case of a redemption at the
election of the holder of Series O Preferred Shares to the Corporation not
less than thirty (30) days prior to the date upon which such stock is to be
redeemed. In case less than all of the outstanding Series O Preferred
Shares are to be redeemed by the Corporation, the amount to be redeemed and
the method of effecting such redemption, whether by lot or pro rata or
otherwise, may be determined by the Board of Directors. If on or before the
redemption date specified in such notice, the funds necessary for such
redemption shall have been set aside by the Corporation so as to be
available for payment on demand to the holders of the Series O Preferred
Shares so called for or requesting redemption, then, notwithstanding that
any certificate representing Series O Preferred Shares so called for or
requesting redemption
I-13
<PAGE>
shall not have been surrendered for cancellation, the dividends thereon
shall cease to accrue from and after the date of such redemption so
specified, and all rights with respect to such Series O Preferred Shares
so called for or requesting redemption, including any right to vote or
otherwise participate in the determination of any proposed corporate
action, shall forthwith after such redemption date cease and terminate,
except only the right of the holder to receive the redemption price
therefor, but without interest. Series O Preferred Shares redeemed
pursuant to the provisions hereof or any such shares purchased or
otherwise acquired shall not be reissued but shall be canceled and
proceedings shall be taken in the manner prescribed by statute to reduce
the number of outstanding Series O Preferred Shares accordingly.
(d) VOTING RIGHTS-
(1) For all purposes, the holders of Series O Preferred Shares shall
be entitled to one vote for each share of such stock standing in the name
of the holder on the books of the Corporation.
(2) Subject to the rights, if any, of the holders of one or more
series of Preferred Shares, voting as a class, to elect one or more
directors, in the election of directors, the holders of Series O Preferred
Shares shall vote together as one class with the Series A Common Shares.
The total number of directors of the Corporation shall be determined
without regard to any director(s) whom the holders of one or more series of
Preferred Shares, voting as a class, have elected or have the right to
elect. In the event the number of issued and outstanding Series A Common
Shares at any time falls below 500,000, then with respect to the election
of directors at the next annual meeting thereafter the holders of Common
Shares, Series A Common Shares and Preferred Shares shall be entitled to
elect all of the directors of the Corporation.
(e) PREEMPTIVE RIGHTS-No holder of any Series O Preferred Shares shall
have any preemptive right to subscribe for or acquire additional shares of the
Corporation of the same or any other class or series, whether such shares be
hereby or hereafter authorized; and no holder of Series O Preferred Shares shall
have any preemptive right to acquire any shares which may be held in the
treasury of the Corporation; all such additional or treasury shares may be sold
for such consideration at such time and to such person or persons as the board
of directors may from time to time determine.
(f) CONVERSION-
(1) (A) The Series O Preferred Shares shall be convertible into the
Corporation's Common Shares as hereinafter provided, and when and as
so converted, such Series O Preferred Shares shall be canceled and
retired and shall not be reissued as such. Commencing upon issuance
and terminating at the close of business on December 31, 1988, the
Series O Preferred Shares may be converted, upon sixty (60) days'
written notice to the Corporation, into Common Shares of the
Corporation at the rate of nine (9) Common Shares for each Series O
Preferred Share. Thereafter, until the close of business on
December 31, 1989, the Series O Preferred Shares may be converted,
upon sixty (60) days' written notice to the Corporation, into Common
Shares of the Corporation at the rate of eight (8) Common Shares for
each Series O Preferred Share. On presentation and surrender to the
Corporation at its offices of the certificates representing the
Series O Preferred Shares to be converted, the holder thereof shall be
entitled to receive in exchange therefor certificates for fully paid
and non-assessable Common Shares of the Corporation at the rate
aforesaid, all under suitable regulations to be prescribed by the
board of directors of the Corporation. Conversion of Series O
Preferred Shares in the manner aforesaid shall not affect the right of
the converting holder thereof to receive dividends accrued but unpaid
thereon as of the dividend payment date immediately prior to
conversion.
(B) Notwithstanding the provisions of clause (A) above, if the
Market Value (as defined below) of a Common Share does not exceed
$12.875 per share on each of five consecutive trading days for at
least two periods of five days each from the date of issuance to
December 31, 1987, then the Corporation will deliver additional Common
Shares to qualified shareholders, in an amount equal to the Price
Differential (as defined below). The payment of additional Common
Shares is limited to those shareholders electing to receive stock in
connection with the acquisition of Chatham Telephone Company and
others who receive such stock from such shareholders through
inheritance or gift, and who complete the conversion of their Series O
Preferred Shares, as provided herein, prior to August 1, 1988, and is
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<PAGE>
further limited to those Common Shares owned by the shareholder on
August 1, 1988 which were (i) issued in the original distribution of
Series O Preferred Shares, or (ii) acquired pursuant to a conversion
of Series O Preferred Shares (the "Qualified Shares"). For purposes
of calculating the number of additional Common Shares to be issued,
the value of each additional Common Share being issued shall be the
highest average Market Value for two periods of five consecutive
trading days from the date of issuance through December 31, 1987.
This value is referred to hereinafter as the "Additional Share Value."
The number of additional Common Shares to be issued shall be
determined by dividing the Price Differential by the Additional Share
Value. No fractional shares will be issued in connection with the
payment of additional shares. An equivalent amount of cash for such
fractional shares shall be distributed based upon the Additional Share
Value.
For purposes hereof:
1. "Market Value" means the high sales price of a Common Share,
as reported in the Wall Street Journal.
2. "Price Differential" means the difference between the
highest average Market Value for five (5) consecutive
trading days during the period from the date of issuance
through December 31, 1987, and $12.875, multiplied by the
number of Qualified Shares.
(2) The number of Common Shares into which each Series O Preferred
Share is convertible shall be subject to adjustment from time to time as
set forth in clauses (A) and (B) of this subparagraph (2):
(A) In case the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation, (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares or (iv) issue by reclassification of
its Common Shares (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
Series O Preferred Share shall be entitled to receive upon the
conversion of such share, the number of shares of the Corporation
which the holder would have owned or would have been entitled to
receive after the happening of any of the events described above had
such share been converted immediately prior to the happening of such
event. An adjustment made pursuant to this provision shall become
effective retroactively with respect to conversions made subsequent to
the record date in the case of a dividend, and shall become effective
on the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth (1/10) of a Common Share; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account by any subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series O Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series O Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series O Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For the purposes of this paragraph (f), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such class consisting solely of a change in par value,
or a change from no par value to par value.
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<PAGE>
(g) LIQUIDATION RIGHTS-In the event of any liquidation, dissolution or
winding up of the affairs of the Corporation, whether voluntary or involuntary,
the holders of the Series O Preferred Shares shall be entitled, before any
assets of the Corporation shall be distributed among or paid over to the holders
of Common Shares or Series A Common Shares, to receive out of the assets of the
Corporation $100.00 per Series O Preferred Share. If upon any such dissolution,
liquidation or winding up, the assets of the Corporation available for payment
to shareholders are not sufficient to make payment in full to the holders of the
Series O Preferred Shares, payment shall be made to such holders ratably in
accordance with the number of shares held by them and, in case there shall then
be more than one series of preferred stock outstanding at that time, ratably in
accordance with the respective distributive amount to which such holders shall
be entitled.
S. $10.50/$7.00 CUMULATIVE AND CONVERTIBLE VOTING SERIES S PREFERRED SHARES,
$.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "$10.50/$7.00 Cumulative and Convertible Voting Series S Preferred Shares"
(hereinafter referred to as the "Series S Preferred Shares").
(b) DIVIDENDS-The rate of dividend payable upon Series S Preferred Shares
shall be ten and 50/100 dollars ($10.50) per share per annum during the first
year after issuance and seven and no/100 dollars ($7.00) per share per annum
thereafter.
(c) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series S Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of
Series S Preferred Shares shall have class voting rights (voting together
with the holders of (A) other Preferred Shares that are entitled to vote
thereon and that were issued after October 31, 1981, and (B) Series A
Common Shares) to the extent provided in Article IV of the Restated
Certificate of Incorporation of the Corporation.
(d) CONVERSION-
(1) The Series S Preferred Shares shall be convertible into the
Corporation's Common Shares as hereinafter provided, and when and as so
converted, such Series S Preferred Shares shall be canceled and retired and
shall not be reissued as such. Commencing upon issuance and terminating
four (4) years thereafter, the Series S Preferred Shares may be converted,
upon written notice to the Corporation, into Common Shares of the
Corporation at the rate of four (4) Common Shares for each Series S
Preferred Share. On presentation and surrender to the Corporation at its
offices of the certificate representing the Series S Preferred Shares to be
converted, the holder thereof shall be entitled to receive in exchange
therefor certificates for the fully paid and non-assessable Common Shares
of the Corporation at the rate aforesaid, all under suitable regulations to
be prescribed by the board of directors of the Corporation. Conversion of
Series S Preferred Shares in the manner aforesaid shall not affect the
right of the converting holder thereof to receive dividends accrued but
unpaid thereon as of the dividend payment date immediately prior to
conversion.
(2) The number of Common Shares into which each Series S Preferred
Share is convertible shall be subject to adjustment from time to time as
set forth in clauses (A) and (B) of this subparagraph (2):
(A) In case the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares or (iv) issue by reclassification of
its Common Shares (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
Series S Preferred Share shall be entitled to receive upon the
conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective
retroactively with
I-16
<PAGE>
respect to conversions made subsequently to the record date in the
case of a dividend, and shall become effective on the effective date
in the case of a subdivision, combination or reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth (1/10) of a Common Share; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account by any subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series S Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series S Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series S Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For the purposes of this paragraph (d), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such class consisting solely of a change in par value,
or a change from no par value to par value.
(e) LIQUIDATION-The amount payable upon each Series S Preferred Share in
the event of either voluntary or involuntary liquidation shall be $100.00, plus
a sum equal to the amount of all accumulated and unpaid dividends thereon.
U. $8.50 CUMULATIVE, NON-CONVERTIBLE, REDEEMABLE AND VOTING SERIES U PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "$8.50 Cumulative, Non-Convertible, Redeemable and Voting Series U Preferred
Shares" (hereinafter referred to as "Series U Preferred Shares").
(b) DIVIDENDS-The rate of dividend payable upon Series U Preferred Shares
shall be eight and 50/100 dollars ($8.50) per share per annum. Such dividends
shall be cumulative from and commence to accrue on the date of issuance.
(c) REDEMPTION-
(1) After the fifth anniversary of the date of issuance, the
Corporation may, at its option, redeem annually up to twenty percent (20%)
of the Series U Preferred Shares outstanding on such fifth anniversary for
$100.00 per share. After the tenth anniversary of their issuance, the
Corporation may at any time redeem, in whole or in part, the then
outstanding Series U Preferred Shares for $100.00 per share. In addition
to the redemption price, the following shall be paid:
(A) any accrued and unpaid dividends with respect to each Series
U Preferred Share redeemed, and
(B) an amount equal to $2.125 for each Series U Preferred Share
redeemed MULTIPLIED BY the number of days between the date fixed for
redemption and the March 1, June 1, September 1, or December 1
immediately preceding the date fixed for redemption and DIVIDED BY 90.
(2) Notice of an election under the redemption provision in
subparagraph (c)(1) above shall be delivered to each holder of Series U
Preferred Shares to be redeemed at the address appearing on the records of
the Corporation not less than thirty (30) days prior to the date upon which
such stock is to be redeemed. If on or before the redemption date
specified in such notice, the funds necessary for such redemption shall
have been set aside by the Corporation so as to be available for payment on
demand to the holder of the Series U Preferred Shares so called
I-17
<PAGE>
for redemption, then, notwithstanding that any certificate representing
Series U Preferred Shares so called for redemption shall not have been
surrendered for cancellation, the dividends thereon shall cease to
accrue from and after the date of such redemption so specified, and all
rights with respect to such Series U Preferred Shares so called for
redemption, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall terminate at the
close of business on such redemption date, except only the right of the
holder to receive the redemption price therefor, but without interest.
The Series U Preferred Shares purchased or otherwise acquired shall not
be reissued but shall be canceled and proceedings shall be taken in the
manner prescribed by statute to reduce the number of Preferred Shares
which the Corporation is authorized to issue by the number of shares
canceled.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series U Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
U Preferred Shares shall have class voting rights (voting together with the
holders of (A) other Preferred Shares that are entitled to vote thereon and
that were issued after October 31, 1981, and (B) Series A Common Shares) to
the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) CONVERSION-The Series U Preferred Shares shall not be convertible.
(f) LIQUIDATION-The amount payable upon each Series U Preferred Share in
the event of either voluntary or involuntary liquidation shall be $100.00, plus
a sum equal to the amount of all accumulated and unpaid dividends thereon.
BB. $9.00 CUMULATIVE AND CONVERTIBLE VOTING SERIES BB PREFERRED SHARES, $.01
PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be $9.00 Cumulative, Convertible and Redeemable Voting Series BB Preferred
Shares" (hereinafter referred to as the "Series BB Preferred Shares").
(b) DIVIDENDS-The rate of dividend payable upon Series BB Preferred Shares
shall be nine and no/100 dollars ($9.00) per share per annum.
(c) REDEMPTION-
(1) Unless the Series BB Preferred Shares have been converted, or
written notice to convert has been received prior to the expiration of the
conversion period set forth in paragraph (e) hereof, then commencing with
the tenth anniversary of the issuance of the Series BB Preferred Shares and
ending ten years thereafter, the Corporation may, at its sole option, at
any time thereafter, redeem up to two thousand (2,000) shares per annum of
the then outstanding Series BB Preferred Shares for $100.00 per share, plus
an amount equal to all dividends accrued and unpaid thereon on the
redemption date.
(2) Notice of an election under the redemption provision in
subparagraph (c)(1) above shall be delivered to the Corporation not less
than thirty (30) days prior to the date upon which such stock is to be
redeemed. If on or before the redemption date specified in such notice,
the funds necessary for such redemption shall have been set aside by the
Corporation so as to be available for payment on demand to the holder of
Series BB Preferred Shares so offered for redemption, then, notwithstanding
that any certificate representing Series BB Preferred Shares so offered for
redemption shall have not been so surrendered for cancellation, the
dividends thereon shall cease to accrue from and after the date of such
redemption so specified, and all rights with respect to such Series BB
Preferred Shares so offered for redemption, including any right to vote or
otherwise participate in the determination of any proposed corporate
action, shall forthwith after such redemption date shall cease and
terminate, except only the right of the holder to receive the redemption
price therefor, but without interest.
I-18
<PAGE>
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series BB Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
BB Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) CONVERSION-
(1) The Series BB Preferred Shares shall be convertible into the
Corporation's Common Shares as hereinafter provided. Commencing upon
issuance and terminating ten (10) years thereafter, the Series BB Preferred
Shares may be converted, upon written notice to the Corporation, into
Common Shares of the Corporation at the rate of six (6) Common Shares for
each Series BB Preferred Share. On presentation and surrender to the
Corporation at its offices of the certificate representing the Series BB
Preferred Shares to be converted, the holder thereof shall be entitled to
receive in exchange therefor certificates for the fully paid and
non-assessable Common Shares of the Corporation at the rate aforesaid, all
under suitable regulations to be prescribed by the board of directors of
the Corporation. Conversion of Series BB Preferred Shares in the manner
aforesaid shall not affect the right of the converting holder thereof to
receive dividends accrued but unpaid thereon as of the dividend payment
date immediately prior to conversion.
(2) The number of Common Shares into which each Series BB Preferred
Share is convertible shall be subject to adjustment from time to time as
set forth in clauses (A) and (B) of this subparagraph (2):
(A) In case the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares, or (iv) issue by reclassification of
its Common Shares (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
Series BB Preferred Share shall be entitled to receive upon the
conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective
retroactively with respect to conversions made subsequent to the
record date in the case of a dividend, and shall become effective on
the effective date in the case of a subdivision, combination or
reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth (1/10) of a Common Share; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series BB Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series BB Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series BB Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For the purposes of this paragraph (e), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation at the date of this Restated Certificate of Incorporation, or
(B) any other class of stock resulting from successive changes or
reclassifications of such class consisting solely of a change in par value,
or a change from no par value to par value.
I-19
<PAGE>
(f) LIQUIDATION-The amount payable upon each Series BB Preferred Share in
the event of either voluntary or involuntary liquidation shall be $100.00, plus
a sum equal to the amount of all accumulated and unpaid dividends thereon.
DD. $7.00 CUMULATIVE, CONVERTIBLE AND REDEEMABLE VOTING SERIES DD PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be $7.00 Cumulative, Convertible and Redeemable Voting Series DD Preferred
Shares (hereinafter referred to as the "Series DD Preferred Shares").
(b) DIVIDENDS-The rate of dividend payable upon Series DD Preferred Shares
shall be seven and no/100 dollars ($7.00) per share per annum.
(c) CONVERTIBILITY-Commencing upon issuance and terminating on the day
before the fifteenth anniversary thereof, the Series DD Preferred Shares shall
be convertible, at the election of the holder of Series DD Preferred Shares and
upon surrender to the Corporation of the certificate or certificates
representing the shares to be converted, into fully paid and non-assessable TDS
Common Shares, $1.00 par value (hereinafter referred to as the "Common Shares"),
at the rate of five and one-quarter (5.25) Common Shares for each Series DD
Preferred Share. Certificates representing any Series DD Preferred Shares
surrendered for conversion shall be delivered to the Corporation duly endorsed,
or accompanied by proper instruments of transfer, to the Corporation or in
blank, together with a written notice to the Corporation of the holder's
election to make the conversion and of the name or names in which the
certificate or certificates for Common Shares shall be issued. The Corporation
shall pay all documentary, stamp, and similar taxes that may be payable in
respect of the issue or delivery of Common Shares upon conversion of any Series
DD Preferred Shares. The Corporation shall at all times reserve and keep
available, free from preemptive rights, out of its authorized but unissued
Common Shares the full number of Common Shares that would be deliverable upon
the conversion of Series DD Preferred Shares then outstanding.
If at any time the Corporation elects to redeem part or all of the
outstanding Series DD Preferred Shares (pursuant to paragraph (e) of this
Statement of Designation, Preferences and Rights), the holders of the Series
DD Preferred Shares that the Corporation elects to redeem shall be entitled
to convert those shares to Common Shares by delivering to the Corporation,
not less than ten (10) days before the redemption date specified in the
Corporation's notice of redemption, a written notice of the holder's election
to convert part or all of his Series DD Preferred Shares to Common Shares,
together with the certificate or certificates representing the Series DD
Preferred Shares to be converted duly endorsed (or accompanied by proper
instruments of transfer) to the Corporation or in blank.
The number of Common Shares into which each Series DD Preferred Share is
convertible shall be subject to adjustment from time to time as set forth
below:
In case the Corporation shall (1) pay a dividend on its Common Shares (in
shares of the Corporation), (2) subdivide its outstanding Common Shares, (3)
combine the outstanding Common Shares into a smaller number of shares or (4)
issue by reclassification of its Common Shares (whether pursuant to a merger or
consolidation or otherwise) any shares of the Corporation, then the holder of
each Series DD Preferred Share shall be entitled to receive upon the conversion
of such share, the number of shares of the Corporation which he or she would
have owned or would have been entitled to receive after the happening of any of
the events described above had such share been converted immediately prior to
the happening of such event. An adjustment made pursuant to this provision
shall become effective retroactively with respect to conversions made subsequent
to the record date in the case of a dividend, and shall become effective on the
effective date in the case of a subdivision, combination or reclassification.
Fractional Common Shares shall not be issued upon conversion of Series DD
Preferred Shares, nor shall cash adjustments be made for fractional shares upon
such conversion.
(d) LIQUIDATION VALUE-Each Series DD Preferred Share shall have a
liquidation value of $100.00.
(e) REDEEMABILITY-The Series DD Preferred Shares shall be redeemable upon
the second anniversary of their issuance, and on each anniversary thereafter
through the sixth such anniversary, at the election of the holder of Series DD
Preferred Shares, which election shall be made not less than ten (10) days
before each such anniversary. The Corporation shall redeem on a pro-rata basis
for each holder, up to twenty percent (20%) of the number of Series DD Preferred
Shares
I-20
<PAGE>
issued and outstanding on each anniversary of their issuance without premium,
upon payment to the holder of Series DD Preferred Shares to be redeemed of
$100.00 per share PLUS
(1) any accrued and unpaid dividends with respect to each Series DD
Preferred Share redeemed, and
(2) an amount equal to $1.75 for each Series DD Preferred Share
redeemed MULTIPLIED BY the number of days between the date fixed for
redemption and the March 1, June 1, September 1, or December 1 immediately
preceding the date fixed for redemption and DIVIDED BY 90.
The right of redemption provided in the preceding sentence shall not be
cumulative. In the event that a holder of Series DD Preferred Shares fails to
exercise its right of redemption during any year, such right of redemption with
respect to the Series DD Preferred Shares eligible for redemption during such
year shall lapse. A holder of Series DD Preferred Shares shall exercise its
right of redemption by mailing to the Corporation written notice of its election
to redeem Series DD Preferred Shares, together with a certificate or
certificates representing the Series DD Preferred Shares to be redeemed, duly
endorsed or accompanied by proper instruments of transfer. The foregoing right
of redemption may only be exercised if the price of the Common Shares at the
time the holder of Series DD Preferred Shares gives notice of his or her desire
to have Series DD Preferred Shares redeemed is below $19.00 per share (or such
equivalent price as may exist as a result of any stock split, stock dividend,
reclassification or similar event).
After the fifteenth anniversary of their issuance, the Series DD Preferred
Shares outstanding may be redeemed at the election of the Corporation from time
to time in whole or in part, without premium, upon payment to the holder of
Series DD Preferred Shares to be redeemed of $100 per share PLUS
(1) any accrued and unpaid dividends with respect to each Series DD
Preferred Share redeemed, and
(2) an amount equal to $1.75 for each Series DD Preferred Share
redeemed MULTIPLIED BY the number of days between the date fixed for
redemption and the March 1, June 1, September 1, or December 1 immediately
preceding the date fixed for redemption and DIVIDED BY 90.
Notice of any redemption shall be mailed to each holder of Series DD Preferred
Shares to be redeemed not less than thirty (30) days prior to the date upon
which such stock is to be redeemed. If on or before the redemption date
specified in such notice, the funds necessary for such redemption shall have
been set aside by the Corporation so as to be available for payment on demand to
the holders of Series DD Preferred Shares so called for redemption then,
notwithstanding that any certificate representing Series DD Preferred Shares so
called for redemption shall not have been surrendered for cancellation, the
dividends thereon shall cease to accrue from and after the date of such
redemption so specified, and all rights with respect to such Series DD Preferred
Shares so called for redemption, including any right to vote or otherwise
participate in the determination of any proposed corporate action, shall
forthwith after such redemption date cease and terminate, except only the right
of the holder to receive the redemption price therefor, but without interest.
(f) VOTING RIGHTS-With respect to all matters, each holder of Series DD
Preferred Shares shall be entitled to one vote for each share of such stock
standing in the name of the holder on the books of the Corporation. With
respect to the election of directors, the holders of Series DD Preferred Shares
shall have class voting rights (voting together with the holders of (1) other
Preferred Shares that are entitled to vote thereon and that were issued after
October 31, 1981, and (2) Series A Common Shares) to the extent provided in
Article IV of the Restated Certificate of Incorporation of the Corporation.
(g) LIQUIDATION PREFERENCE-For purposes of Article IV of this Restated
Certificate of Incorporation, the "fixed amount payable" for the Series DD
Preferred Shares shall be $100.00 per share.
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<PAGE>
EE. $6.00 CUMULATIVE, CONVERTIBLE, REDEEMABLE AND VOTING SERIES EE PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "$6.00 Cumulative, Convertible, Redeemable and Voting Series EE Preferred
Shares" (hereinafter referred to as the "Series EE Preferred Shares").
(b) DIVIDENDS-The rate of dividend payable upon Series EE Preferred Shares
shall be six and no/100 dollars ($6.00) per share per annum. Such dividends
shall be cumulative from and commence to accrue on the date of issuance.
(c) REDEMPTION-
(1) After the twentieth anniversary of the date of issuance, the
Corporation may, at its option, at any time redeem all or a portion of the
then outstanding Series EE Preferred Shares for $100.00 per share, plus an
amount equal to all accumulated and unpaid dividends thereon.
(2) Notice of an election under the redemption provision in
subparagraph (c)(1) above shall be delivered to each holder of Series EE
Preferred Shares to be redeemed at the address appearing on the records of
the Corporation not less than thirty (30) days prior to the date upon which
such stock is to be redeemed. If, on the redemption date specified in such
notice, the funds necessary for such redemption shall have been set aside
by the Corporation so as to be available for payment on demand to the
holder of Series EE Preferred Shares so called for redemption, then
notwithstanding that any certificate representing Series EE Preferred
Shares so called for redemption shall not have been surrendered for
cancellation, the dividends thereon shall cease to accrue from and after
the date of such redemption so specified, and all rights with respect to
such Series EE Preferred Shares so called for redemption, including any
right to vote or otherwise participate in the determination of any proposed
corporate action, shall terminate at the close of business on such
redemption date, except only the right of the holder to receive the
redemption price therefor, but without interest.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series EE Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
EE Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) CONVERSION-
(1) Commencing upon issuance and terminating at the close of business
on the day before the tenth anniversary of the date of issuance, each
outstanding Series EE Preferred Share may be converted, upon fifteen (15)
days' written notice into four and one-half (4.5) Common Shares. On
presentation and surrender to the Corporation at its offices of the
certificate representing the Series EE Preferred Shares to be converted,
the holder thereof shall be entitled to receive in exchange therefor
certificates for the fully paid and non-assessable Common Shares of the
Corporation at the rate aforesaid, all under suitable regulations to be
prescribed by the board of directors of the Corporation. Conversion of
Series EE Preferred Shares in the manner aforesaid shall not affect the
right of the converting holder thereof to receive dividends accrued but
unpaid thereon as of the dividend payment date immediately prior to
conversion.
(2) The number of Common Shares into which each Series EE Preferred
Share is convertible shall be subject to adjustment from time to time. In
the event the Corporation shall (A) pay a dividend on its Common Shares (in
Common Shares of the Corporation) of more than 20% of the number of
outstanding Common Shares, (B) subdivide its outstanding Common Shares, (C)
combine the outstanding Common Shares into a smaller number of shares or
(D) issue by reclassification of its Common Shares (whether pursuant to a
merger or consolidation or otherwise) any shares of the Corporation, then
the holder of each Series EE Preferred Share shall be entitled to
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<PAGE>
receive, upon the conversion of such share, the number of shares of the
Corporation which he would have owned or would have been entitled to
receive after the happening of any of the events described above had
such share been converted immediately prior to the happening of such
event. An adjustment made pursuant to this provision shall become
effective retroactively with respect to conversions made after the
record date in the case of a dividend, and shall become effective on the
effective date in the case of a subdivision, combination or
reclassification.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series EE Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series EE Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series EE Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For the purposes of this paragraph (e), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation on the date this Restated Certificate of Incorporation is filed
with the Delaware Secretary of State, or (B) any other class of stock
resulting from successive changes or reclassifications of such class
consisting solely of a change in par value, or a change from no par value.
(f) LIQUIDATION-The amount payable upon each Series EE Preferred Share in
the event of either voluntary or involuntary liquidation shall be $100.00, plus
a sum equal to the amount of all accumulated and unpaid dividends thereon.
GG. $5.00 CUMULATIVE CONVERTIBLE AND REDEEMABLE VOTING SERIES GG PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "$5.00 Cumulative Convertible and Redeemable Voting Series GG Preferred
Shares" (hereinafter referred to as the "Series GG Preferred Shares").
(b) DIVIDENDS-Each holder of a share of Series GG Preferred Shares
shall be entitled to receive, when, as and if declared by the board of
directs of the Corporation, out of funds of the Corporation legally available
therefor, cumulative dividends during each fiscal quarter that such Series GG
Preferred Shares is outstanding at a per annum dividend rate of five dollars
($5.00) per share. Such dividends shall be cumulative from and commence to
accrue on the date of original issuance of such Series GG Preferred Shares
(the "Issue Date").
(c) REDEMPTION-
(1) Unless the Series GG Preferred Shares have been converted or
the Corporation shall have received prior to the tenth anniversary of
the Issue Date written notice of election to convert in accordance with
paragraph (e) hereof, on or after the tenth anniversary of the Issue
Date, the Series GG Preferred Shares shall be redeemable, in whole or in
part from time-to-time, at the option of the Corporation, upon giving
notice as provided in subparagraph (c)(2) hereof, at a redemption price
(the "Redemption Price") equal to the product of the number of Series GG
Preferred Shares called for redemption times the sum of (A) $100.00 per
Series GG Preferred Share plus (B) all dividends accrued and unpaid
thereon through the date set for redemption (the "Redemption Date");
provided, however, that prior to the twelfth anniversary of the Issue
Date the Corporation shall have redeemed all the Series GG Preferred
Shares outstanding. The Redemption Price payable on any Redemption Date
shall be payable, at the option of Corporation, (x) in cash (by
certified check) or (y) by the issuance of Common Shares of the
Corporation to the record holder of such Series GG Preferred Shares
being redeemed. In the event that the Corporation elects to pay the
Redemption Price by issuing its Common Shares, the number of Common
Shares to be issued shall be calculated based upon the closing price on
the American Stock Exchange (or, if the Corporation's Common Shares are
not listed on the American Stock Exchange on the first trading day
immediately preceding the date notice is given, the closing price of
such Common Shares on (in order if more than one applies) any national
securities exchange, any regional securities exchange, the highest bid
price quoted through the National Association of Securities Dealers
Automated Quotation System or the highest bid price reported by dealers
in the over-the-counter market) of the Corporation's Common Shares on
the first trading day immediately preceding the date that the notice of
redemption is mailed to record holders.
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<PAGE>
(2) Notice of an election under the redemption provision in
subparagraph (c)(1) above shall be mailed (by first class, postage prepaid)
to each holder of Series GG Preferred Shares to be redeemed at the address
appearing on the records of the Corporation not less than thirty (30) days
prior to the Redemption Date. If on or before the Redemption Date
specified in such notice, the funds necessary for such redemption shall
have been set aside by the Corporation so as to be available for payment to
the holder of Series GG Preferred Shares so called for redemption upon such
holder's surrender of such Series GG Preferred Shares to the Corporation,
then, notwithstanding that any certificate representing Series GG Preferred
Shares so called for redemption shall not have been surrendered for
cancellation, the dividends thereon shall cease to accrue from and after
the Redemption Date, and all rights with respect to such Series GG
Preferred Shares so called for redemption, including any right to vote or
otherwise participate, in the determination of any proposed corporate
action, shall terminate at the close of business on such Redemption Date,
except only the right of the holder to receive the Redemption Price
therefor, but without interest.
(d) Each such notice of redemption shall state:
(1) the Redemption Date;
(2) the number of Series GG Preferred Shares to be redeemed and, if
less than all the shares held by such holder are to be redeemed from such
holder, the number of shares to be redeemed from such holder;
(3) whether the Redemption Price will be paid in cash (by certified
check) or by the issuance of Common Shares of the Corporation, and, if
payment is to be made by the issuance of Common Shares, the number of
Common Shares to be issued to such holder;
(4) the place where certificates for such shares are to be
surrendered for payment of the Redemption Price; and
(5) that dividends on the shares to be redeemed shall cease to accrue
on such Redemption Date.
On or after the Redemption Date each holder of shares of Series GG
Preferred Shares to be redeemed shall present and surrender his certificate or
certificates for such shares to the Corporation at the place designated in such
notice and thereupon the Redemption Price of such shares shall be paid to or on
the order of the person whose name appears on such certificate or certificates
as the owner thereof and each surrendered certificate shall be cancelled. In
case fewer than all the shares represented by such certificate are redeemed, a
new certificate shall be issued representing the unredeemed shares. From and
after the Redemption Date (unless the Corporation shall default in payment of
the Redemption Price) all dividends on the shares of Series GG Preferred Shares
designated for redemption in such notice shall cease to accrue, and all rights
of the holders thereof as shareholders of the Corporation, except the right to
receive the Redemption Price thereof, without interest, upon the surrender of
certificates representing the same, shall cease and terminate and such shares
shall not thereafter be transferred (except with the consent of the Corporation)
on the books of the Corporation and such shares shall not be deemed to be
outstanding for any purpose whatsoever.
(e) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series GG Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
GG Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(f) CONVERSION-
(1) Commencing upon the Issue Date and terminating at the close of
business on the day before the tenth anniversary of the Issue Date, the
outstanding Series GG Preferred Shares may be converted at any time, upon
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fifteen (15) days' written notice mailed to the Corporation (by first
class, postage prepaid), into 2.3 Common Shares for each Series GG
Preferred Share. On presentation and surrender of the certificate(s)
representing the Series GG Preferred Shares to be converted to the
Corporation at its offices, the holder thereof shall be entitled to receive
in exchange therefor certificates for the fully paid and non-assessable
Common Shares of the Corporation at the rate aforesaid, all under suitable
regulations to be prescribed by the board of directors of the Corporation.
Conversion of Series GG Preferred Shares in the manner aforesaid shall not
affect the right of the converting holder thereof to receive dividends
accrued but unpaid thereon as of the dividend payment date immediately
prior to the date of conversion (the "Conversion Date").
(2) The number of Common Shares into which each Series GG Preferred
Shares is convertible shall be subject to adjustment from time to time as
set forth in clauses (A) and (B) of this subparagraph (2):
(A) In the event the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation, (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares or (iv) issue by reclassification of
its Common Shares (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
Series GG Preferred Share shall be entitled to receive upon the
conversion of such share, the number of shares of the Corporation
which he would have owned or would have been entitled to receive after
the happening of any of the events described above had such share been
converted immediately prior to the happening of such event. An
adjustment made pursuant to this provision shall become effective
retroactively with respect to conversions made after the record date
in the case of a dividend, and shall become effective on the effective
date in the case of a subdivision, combination or reclassification.
(B) No adjustment in the conversion rate shall be required
unless such adjustment would require an increase or decrease in such
rate of at least one-tenth (1/10) of a Common Share; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series GG Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series GG Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series GG Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For purposes of this paragraph (e), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation on the date this Restated Certificate of Incorporation is filed
with the Delaware Secretary of State, or (B) any other class of stock
resulting from successive changes or reclassifications of such class
consisting solely of a change in par value, or a change from no par value
to par value.
(6) Each such notice of conversion shall state:
(A) The Conversion Date (which shall be at least fifteen (15)
days subsequent to the date of mailing of such notice); and
(B) The number of Series GG Preferred Shares to be converted, if
less than all the shares held by such holder.
The holder shall deliver his certificate(s) representing such Series GG
Preferred Shares to be converted to the Corporation with the notice of
conversion. In case fewer than all the shares represented by such certificate
are converted, a new certificate shall be issued representing the unconverted
shares. From and after the Conversion Date (unless the Corporation shall default
in issuing the Common Shares on the Conversion Date) all dividends on such
shares of Series GG Preferred Shares shall cease to accrue and such shares shall
not be outstanding for any purpose whatsoever.
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<PAGE>
(g) PREFERENCE VALUE IN LIQUIDATION. The amount payable upon each
Series GG Preferred Shares in the event of either voluntary or involuntary
liquidation shall be $100.00, plus a sum equal to the amount of all dividends
accrued and unpaid dividends thereon.
II. REDEEMABLE VOTING SERIES II PREFERRED SHARES, $.01 PAR VALUE, LIQUIDATION
VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "Redeemable Voting Series II Preferred Shares" (hereinafter referred to as
the "Series II Preferred Shares").
(b) DIVIDENDS-Each holder of a Series II Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, out of funds of the Corporation legally available therefor,
cumulative dividends during each fiscal quarter that such Series II Preferred
Shares are outstanding at a per annum dividend rate of six dollars ($6.00) per
share. Such dividends shall be payable as declared and cumulative from and
commence to accrue on the date of original issuance of such Series II Preferred
Shares (the "Issue Date").
(c) REDEMPTION AT ELECTION OF HOLDER-
(1) The Series II Preferred Shares shall be redeemable, in whole or
in part, at the option of the holder thereof, on March 1, 1993, upon
written notice given by such holder, between September 1, 1992 and
December 1, 1992 and on the first day of March in calendar years 1997
through 2012, upon written notice given by such holder between the first
day of September and the first day of December of the immediately preceding
calendar year, of the holder's election to have the Corporation redeem such
shares on March 1st of the next succeeding calendar year (the "Redemption
Date"). Notice of an election under the redemption provision above shall be
mailed (by first class, postage prepaid) to the office or agency maintained
by the Corporation for that purpose and each notice shall state the number
of Series II Preferred Shares to be redeemed, if less than all the shares
held by the holder giving such notice.
(2) Except as provided in the preceding paragraph, the Series II
Preferred Shares shall not be subject to redemption and shall not be
subject to the election by the holder thereof to have the Corporation
redeem such Series II Preferred Shares.
(3) Upon receipt of written notice from the holder of its election to
redeem, the Corporation shall redeem the Series II Preferred Shares to be
redeemed pursuant to such notice of redemption on the Redemption Date. The
redemption price (the "Redemption Price") of the Series II Preferred Shares
shall be equal to the product of the number of Series II Preferred Shares
elected to be redeemed multiplied by the sum of (A) $100.00 per share plus
(B) all dividends accrued and unpaid, whether declared or undeclared,
thereon through the Redemption Date. The Redemption Price payable on any
Redemption Date shall be paid by check mailed to the holder within 30 days
of the Redemption Date.
(4) If on or before the Redemption Date, the funds necessary for such
redemption shall have been set aside by the Corporation so as to be
available for payment to any holder of the Series II Preferred Shares to be
redeemed pursuant to such notice of redemption upon such holder's surrender
of such Series II Preferred Shares to the Corporation, then,
notwithstanding that any certificate representing Series II Preferred
Shares to be so redeemed shall not have been surrendered for cancellation,
the dividends thereon shall cease to accrue from and after the Redemption
Date, and all rights with respect to such Series II Preferred Shares to be
so redeemed, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall terminate at the
close of business on such Redemption Date, except only the right of the
holder to receive the Redemption Price therefor, but without interest.
(5) Each holder who has given notice pursuant to subparagraph (c)(1)
above shall deliver the certificate representing the Series II Preferred
Shares to be redeemed to the Corporation with the notice of the redemption.
In case fewer than all the shares represented by such certificate are to be
redeemed, a new certificate shall be issued representing the shares which
were not so redeemed.
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<PAGE>
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series II Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
II Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) PREFERENCE VALUE IN LIQUIDATION-The amount payable upon each Series II
Preferred Share in the event of either voluntary or involuntary liquidation
shall be $100.00.
JJ. REDEEMABLE VOTING SERIES JJ PREFERRED SHARES, $.01 PAR VALUE, LIQUIDATION
VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "Redeemable Voting Series JJ Preferred Shares" (hereinafter referred to as
the "Series JJ Preferred Shares").
(b) DIVIDENDS-Each holder of a Series JJ Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, out of funds of the Corporation legally available therefor,
cumulative dividends during each fiscal quarter that such Series JJ Preferred
Shares are outstanding at a per annum dividend rate of six dollars ($6.00) per
share. Such dividends shall be payable as declared and cumulative from and
commence to accrue on the date of original issuance of such Series JJ Preferred
Shares (the "Issue Date").
(c) REDEMPTION AT ELECTION OF HOLDER-
(1) The Series JJ Preferred Shares shall be redeemable, in whole or
in part, at the option of the holder thereof, on March 1, 1994, upon
written notice given by such holder, between September 1, 1993 and
December 1, 1993 and on the first day of March in calendar years 1997
through 2012, upon written notice given by such holder between the first
day of September and the first day of December of the immediately preceding
calendar year, of the holder's election to have the Corporation redeem such
shares on March 1st of the next succeeding calendar year (the "Redemption
Date"). Notice of an election under the redemption provision above shall be
mailed (by first class, postage prepaid) to the office or agency maintained
by the Corporation for that purpose and each notice shall state the number
of Series JJ Preferred Shares to be redeemed, if less than all the shares
held by the holder giving such notice.
(2) Except as provided in the preceding paragraph, the Series JJ
Preferred Shares shall not be subject to redemption and shall not be
subject to the election by the holder thereof to have the Corporation
redeem such Series JJ Preferred Shares.
(3) Upon receipt of written notice from the holder of its election to
redeem, the Corporation shall redeem the Series JJ Preferred Shares to be
redeemed pursuant to such notice of redemption on the Redemption Date. The
redemption price (the "Redemption Price") of the Series JJ Preferred Shares
shall be equal to the product of the number of Series JJ Preferred Shares
elected to be redeemed multiplied by the sum of (A) $100.00 per share plus
(B) all dividends accrued and unpaid, whether declared or undeclared,
thereon through the Redemption Date. The Redemption Price payable on any
Redemption Date shall be paid by check mailed to the holder within 30 days
of the Redemption Date.
(4) If on or before the Redemption Date, the funds necessary for such
redemption shall have been set aside by the Corporation so as to be
available for payment to any holder of the Series JJ Preferred Shares to be
redeemed pursuant to such notice of redemption upon such holder's surrender
of such Series JJ Preferred Shares to the Corporation, then,
notwithstanding that any certificate representing Series JJ Preferred
Shares to be so redeemed shall not have been surrendered for cancellation,
the dividends thereon shall cease to accrue from and after the Redemption
Date, and all rights with respect to such Series JJ Preferred Shares to be
so redeemed, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall
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<PAGE>
terminate at the close of business on such Redemption Date, except only
the right of the holder to receive the Redemption Price therefor, but
without interest.
(5) Each holder who has given notice pursuant to subparagraph (c)(1)
above shall deliver the certificate representing the Series JJ Preferred
Shares to be redeemed to the Corporation with the notice of the redemption.
In case fewer than all the shares represented by such certificate are to be
redeemed, a new certificate shall be issued representing the shares which
were not so redeemed.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series JJ Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
JJ Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) PREFERENCE VALUE IN LIQUIDATION-The amount payable upon each Series JJ
Preferred Share in the event of either voluntary or involuntary liquidation
shall be $100.00.
KK. REDEEMABLE VOTING SERIES KK PREFERRED SHARES, $.01 PAR VALUE, LIQUIDATION
VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "Redeemable Voting Series KK Preferred Shares" (hereinafter referred to as
the "Series KK Preferred Shares").
(b) DIVIDENDS-Each holder of a Series KK Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, out of funds of the Corporation legally available therefor,
cumulative dividends during each fiscal quarter that such Series KK Preferred
Shares are outstanding at a per annum dividend rate of six dollars ($6.00) per
share. Such dividends shall be payable as declared and cumulative from and
commence to accrue on the date of original issuance of such Series KK Preferred
Shares (the "Issue Date").
(c) REDEMPTION AT ELECTION OF HOLDER-
(1) The Series KK Preferred Shares shall be redeemable, in whole or
in part, at the option of the holder thereof, on March 1, 1995, upon
written notice given by such holder, between September 1, 1994 and
December 1, 1994 and on the first day of March in calendar years 1997
through 2012, upon written notice given by such holder between the first
day of September and the first day of December of the immediately preceding
calendar year, of the holder's election to have the Corporation redeem such
shares on March 1st of the next succeeding calendar year (the "Redemption
Date"). Notice of an election under the redemption provision above shall be
mailed (by first class, postage prepaid) to the office or agency maintained
by the Corporation for that purpose and each notice shall state the number
of Series KK Preferred Shares to be redeemed, if less than all the shares
held by the holder giving such notice.
(2) Except as provided in the preceding paragraph, the Series KK
Preferred Shares shall not be subject to redemption and shall not be
subject to the election by the holder thereof to have the Corporation
redeem such Series KK Preferred Shares.
(3) Upon receipt of written notice from the holder of its election to
redeem, the Corporation shall redeem the Series KK Preferred Shares to be
redeemed pursuant to such notice of redemption on the Redemption Date. The
redemption price (the "Redemption Price") of the Series KK Preferred Shares
shall be equal to the product of the number of Series KK Preferred Shares
elected to be redeemed multiplied by the sum of (A) $100.00 per share plus
(B) all dividends accrued and unpaid, whether declared or undeclared,
thereon through the Redemption Date. The Redemption Price payable on any
Redemption Date shall be paid by check mailed to the holder within 30 days
of the Redemption Date.
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<PAGE>
(4) If on or before the Redemption Date, the funds necessary for such
redemption shall have been set aside by the Corporation so as to be
available for payment to any holder of the Series KK Preferred Shares to be
redeemed pursuant to such notice of redemption upon such holder's surrender
of such Series KK Preferred Shares to the Corporation, then,
notwithstanding that any certificate representing Series KK Preferred
Shares to be so redeemed shall not have been surrendered for cancellation,
the dividends thereon shall cease to accrue from and after the Redemption
Date, and all rights with respect to such Series KK Preferred Shares to be
so redeemed, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall terminate at the
close of business on such Redemption Date, except only the right of the
holder to receive the Redemption Price therefor, but without interest.
(5) Each holder who has given notice pursuant to subparagraph (c)(1)
above shall deliver the certificate representing the Series KK Preferred
Shares to be redeemed to the Corporation with the notice of the redemption.
In case fewer than all the shares represented by such certificate are to be
redeemed, a new certificate shall be issued representing the shares which
were not so redeemed.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series KK Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
KK Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) PREFERENCE VALUE IN LIQUIDATION-The amount payable upon each Series KK
Preferred Share in the event of either voluntary or involuntary liquidation
shall be $100.00.
LL. REDEEMABLE VOTING SERIES LL PREFERRED SHARES, $.01 PAR VALUE, LIQUIDATION
VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of this series of Preferred Shares shall
be "Redeemable Voting Series LL Preferred Shares" (hereinafter referred to as
the "Series LL Preferred Shares").
(b) DIVIDENDS-Each holder of a Series LL Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, out of funds of the Corporation legally available therefor,
cumulative dividends during each fiscal quarter that such Series LL Preferred
Shares are outstanding at a per annum dividend rate of six dollars ($6.00) per
share. Such dividends shall be payable as declared and cumulative from and
commence to accrue on the date of original issuance of such Series LL Preferred
Shares (the "Issue Date").
(c) REDEMPTION AT ELECTION OF HOLDER-
(1) The Series LL Preferred Shares shall be redeemable, in whole or
in part, at the option of the holder thereof, on March 1, 1996, upon
written notice given by such holder, between September 1, 1995 and
December 1, 1995 and on the first day of March in calendar years 1997
through 2012, upon written notice given by such holder between the first
day of September and the first day of December of the immediately preceding
calendar year, of the holder's election to have the Corporation redeem such
shares on March 1st of the next succeeding calendar year (the "Redemption
Date"). Notice of an election under the redemption provision above shall be
mailed (by first class, postage prepaid) to the office or agency maintained
by the Corporation for that purpose and each notice shall state the number
of Series LL Preferred Shares to be redeemed, if less than all the shares
held by the holder giving such notice.
(2) Except as provided in the preceding paragraph, the Series LL
Preferred Shares shall not be subject to redemption and shall not be
subject to the election by the holder thereof to have the Corporation
redeem such Series LL Preferred Shares.
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<PAGE>
(3) Upon receipt of written notice from the holder of its election to
redeem, the Corporation shall redeem the Series LL Preferred Shares to be
redeemed pursuant to such notice of redemption on the Redemption Date. The
redemption price (the "Redemption Price") of the Series LL Preferred Shares
shall be equal to the product of the number of Series LL Preferred Shares
elected to be redeemed multiplied by the sum of (A) $100.00 per share plus
(B) all dividends accrued and unpaid, whether declared or undeclared,
thereon through the Redemption Date. The Redemption Price payable on any
Redemption Date shall be paid by check mailed to the holder within 30 days
of the Redemption Date.
(4) If on or before the Redemption Date, the funds necessary for such
redemption shall have been set aside by the Corporation so as to be
available for payment to any holder of the Series LL Preferred Shares to be
redeemed pursuant to such notice of redemption upon such holder's surrender
of such Series LL Preferred Shares to the Corporation, then,
notwithstanding that any certificate representing Series LL Preferred
Shares to be so redeemed shall not have been surrendered for cancellation,
the dividends thereon shall cease to accrue from and after the Redemption
Date, and all rights with respect to such Series LL Preferred Shares to be
so redeemed, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall terminate at the
close of business on such Redemption Date, except only the right of the
holder to receive the Redemption Price therefor, but without interest.
(5) Each holder who has given notice pursuant to subparagraph (c)(1)
above shall deliver the certificate representing the Series LL Preferred
Shares to be redeemed to the Corporation with the notice of the redemption.
In case fewer than all the shares represented by such certificate are to be
redeemed, a new certificate shall be issued representing the shares which
were not so redeemed.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series LL Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
LL Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) PREFERENCE VALUE IN LIQUIDATION-The amount payable upon each Series LL
Preferred Share in the event of either voluntary or involuntary liquidation
shall be $100.00.
QQ. REDEEMABLE VOTING SERIES QQ PREFERRED SHARES, $.01 PAR VALUE, LIQUIDATION
VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of the series of Preferred Shares created
by this resolution shall be "Redeemable Voting Series QQ Preferred Shares"
(hereinafter referred to as the "Series QQ Preferred Shares").
(b) DIVIDENDS-Each holder of a Series QQ Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, cumulative dividends during each fiscal quarter to the extent set
forth below. Such dividends shall commence to accrue (whether or not declared),
without interest, with the fiscal quarter ending December 31, 1991, at a per
annum rate of four dollars ($4.00) per share and shall be paid (if and when
declared) in cash on the first business day after the end of the quarter for
which accrued; provided, however, that any dividends accrued with respect to the
first thirteen quarters after September 30, 1991, shall be paid by issuing
additional Series QQ Preferred Shares at the annual rate of .04 of a share for
each outstanding Series QQ Preferred Share; and such dividends shall accrue
thereafter at a per annum rate of six dollars ($6.00) per share. If with respect
to any of the first thirteen quarters after September 30, 1991, any of the
additional Series QQ Preferred Shares to be paid in satisfaction of the dividend
then accrued are not issued, then, for the purpose of determining the cumulative
dividends to which each holder of Series QQ Preferred Shares shall thereafter be
entitled to receive with respect to subsequent fiscal quarters ended on or
before December 31, 1994, the additional Series QQ Preferred Shares not so
issued shall be deemed to have been issued as of the first business day
following the fiscal quarter for which accrued and to accrue dividends
commencing with the quarter in which deemed to be issued.
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<PAGE>
(c) REDEMPTION AT ELECTION OF CORPORATION-
(1) Unless the holder shall have elected to have the Series QQ
Preferred Shares redeemed in accordance with subparagraph (d)(1) hereof,
the Series QQ Preferred Shares shall thereafter be redeemable in whole but
not in part by the Corporation, upon giving notice as provided in
subparagraph (c)(2) hereof, by delivering, at the option of the
Corporation, on any date set for redemption (the "Redemption Date"), for
each Series QQ Share (A) 4.35003 (the "Redemption Ratio") fully paid and
non-assessable Common Shares, par value $1.00 per share ("USCC Common
Shares"), of United States Cellular Corporation, a Delaware corporation
("USCC"), or (B) that number of Common Shares, par value $1.00 per share,
of the Corporation ("TDS Common Shares") having a Market Value equal to the
Market Value of one USCC Common Share multiplied by the Redemption Ratio,
or (C) a combination of USCC Common Shares and TDS Common Shares having an
aggregate Market Value equal to the Market Value of one USCC Common Share
multiplied by the Redemption Ratio, or (D) cash (paid by certified check)
equal to the Market Value of one USCC Common Share multiplied by the
Redemption Ratio.
(2) Notice of an election under the redemption provision in
subparagraph (c)(1) above shall be mailed (by first class, postage prepaid)
to each holder of Series QQ Preferred Shares to be redeemed at the address
appearing on the records of the Corporation not less than thirty (30) days
prior to the Redemption Date. If the Corporation elects to redeem any of
the Series QQ Preferred Shares in cash and, on or before the Redemption
Date specified in such notice, the funds necessary for such redemption
shall have been set aside by the Corporation so as to be available for
payment to the holders of Series QQ Preferred Shares so called for
redemption upon such holders' surrender of such Series QQ Preferred Shares
to the Corporation, then, notwithstanding that any certificate representing
Series QQ Preferred Shares so called for redemption shall not have been
surrendered for cancellation, all rights with respect to such Series QQ
Preferred Shares so called for redemption, including any right to vote or
otherwise participate in the determination of any proposed corporate
action, shall terminate at the close of business on such Redemption Date,
except only the right of the holder to receive the Redemption Price
therefor, but without interest.
(3) Each notice of redemption shall state:
(A) the Redemption Date;
(B) the number of Series QQ Preferred Shares to be redeemed;
(C) whether the Redemption Price will be paid in cash (by
certified check), by the issuance of TDS Common Shares, by the
transfer of USCC Common Shares, or by a combination thereof; and
(D) the place where certificates for the Series QQ Preferred
Shares are to be surrendered for payment of the Redemption Price.
(4) Each holder of Series QQ Preferred Shares to be redeemed shall
present and surrender his certificate for such shares to the Corporation at
the place designated in such notice. Within two business days after the
date of such presentation or, if later, upon the Redemption Date, the
Redemption Price of such shares shall be paid to or on the order of the
person whose name appears on such certificate as the owner thereof and each
surrendered certificate shall be canceled. From and after the Redemption
Date (unless the Corporation shall default in payment of the Redemption
Price), all rights of the holders thereof as shareholders of the
Corporation, except the right to receive the Redemption Price thereof,
without interest, upon the surrender of certificates representing the same,
shall cease and terminate, such shares shall not thereafter be transferred
(except with the consent of the Corporation) on the books of the
Corporation, and such shares shall not be deemed to be outstanding for any
purpose whatsoever.
(5) For purposes of this Statement, (A) the "Market Value" per share
of TDS Common Shares or USCC Common Shares at any time as of which such
value is to be determined shall be deemed to be the average "Closing Price"
(as defined below) for TDS or USCC Common Shares, as the case may be, for
the five trading days ending on the fifth business day preceding the
relevant Redemption Date, Accelerated Redemption Date or effective
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date of a Going Private Transaction of the type referred to in clause
(d)(4)(C) below, (B) a "business day" means a day on which the New York
Stock Exchange or other principal stock exchange or over-the-counter market
on which the TDS or USCC Common Shares, as the case may be, are traded was
open for at least one-half of its normal business day, and (C) the "Closing
Price" on any day shall be the last sale price of such shares, regular way,
as reported in a composite published report of transactions which includes
transactions on the exchange or other principal markets in which such
shares are traded or, if there is no such composite report as to any such
day, the last reported sale price, regular way (or if there is no such
reported sale on such day, the average of the closing reported bid and
asked prices) on the principal United States securities trading market
(whether a stock exchange, National Association of Securities Dealers
Automated Quotation System or otherwise) on which such shares are traded.
(d) REDEMPTION AT ELECTION OF HOLDER-
(1) The Series QQ Preferred Shares outstanding on January 1, 1995,
shall be redeemable in whole or in part at the option of the holder thereof
on January 31, 1995, upon written notice given by such holder at the office
or agency maintained by the Corporation for that purpose.
(2) Each Series QQ Preferred Share tendered to the Corporation for
redemption pursuant to subparagraph (d)(1) above shall be redeemed by the
Corporation on the date specified in the notice (and permitted by this
Statement) referred to in subparagraph (d)(1) above (which shall be the
"Redemption Date" of such shares), by delivering, at the option of the
Corporation, (A) that number of fully paid and non-assessable USCC Common
Shares determined by multiplying one (1) by the Redemption Ratio, or
(B) that number of TDS Common Shares having a Market Value equal to the
Market Value of one USCC Common Share multiplied by the Redemption Ratio,
or (C) a combination of USCC Common Shares and TDS Common Shares having an
aggregate Market Value equal to the Market Value of one USCC Common Share
multiplied by the Redemption Ratio.
(3) Upon presentation and surrender of the certificate representing
the Series QQ Preferred Shares to be redeemed, the holder thereof shall be
entitled to receive in exchange therefor a certificate or certificates
representing the fully paid and non-assessable TDS Common Shares, USCC
Common Shares, or a combination thereof, determined in the manner set forth
in subparagraph (d)(2) above. In addition, if any additional Series QQ
Preferred Shares that were to be issued in payment of dividends accrued
with respect to the first thirteen quarters after September 30, 1991, were
not issued prior to the Redemption Date, then such holder shall also
receive, in satisfaction of such dividends, the additional TDS Common
Shares, USCC Common Shares, or a combination thereof, determined in the
manner set forth in subparagraph (d)(2) above, which such holder would have
received if such additional shares had been issued and had been tendered
for redemption.
(4) The amount and kind of securities or property to be delivered
pursuant to subparagraph (c)(1) or (d)(2) above shall be subject to
adjustment from time to time as follows:
(A) In case USCC shall (i) take a record of the holders of USCC
Common Shares for the purpose of entitling them to receive a dividend
payable in USCC Common Shares, (ii) subdivide the outstanding USCC
Common Shares, or (iii) combine the outstanding USCC Common Shares
into a smaller number of shares, the Redemption Ratio shall be
adjusted (or further adjusted in the case of successive such events)
so that each holder of Series QQ Preferred Shares shall thereafter be
entitled upon the redemption of each share thereof held by him to
receive for each such share the number of USCC Common Shares which he
would have owned or been entitled to receive after the happening of
that one of the events described above which shall have happened had
such Series QQ Preferred Share been redeemed immediately prior to the
happening of such event in exchange for USCC Common Shares, such
entitlement to become effective immediately after the opening of
business on the day next following (x) the record date for such
dividend, or (y) the day upon which such subdivision or combination
shall become effective.
(B) In case USCC shall take a record of the holders of USCC
Common Shares for the purpose of entitling them to receive an
Extraordinary Dividend (as hereinafter defined), the holder of each
Series QQ Preferred Share shall be entitled in each such case to an
additional cash payment upon the
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redemption of such share in an amount equal to the amount of cash
and the fair market value as of such record date of any property
other than cash that such holder would have been entitled to
receive as a result of such Extraordinary Dividend had such Series
QQ Preferred Share been redeemed immediately prior to such record
date in exchange for USCC Common Shares. As used herein the term
"Extraordinary Dividend" means any dividend upon USCC Common Shares
payable in cash and/or in property other than cash if and to the
extent that on the record date thereof the amount of such cash and
the fair market value of such property per USCC Common Share (when
added to all other dividends (other than any dividend referred to
in clause (d)(4)(A) above) previously paid on USCC Common Shares
during the same Payment Period (as hereinafter defined)) exceeds
ten percent of the average Closing Price for USCC Common Shares for
the five trading days ending on such record date; provided,
however, that the term "Extraordinary Dividend" shall not include
any dividend referred to in clause (d)(4)(A) above. As used herein
the term "Payment Period" means each consecutive 12-month period
commencing on October 1, 1991, and each anniversary thereof.
(C) In case USCC shall effect a Going Private Transaction (as
hereinafter defined) in which the consideration to be received by the
holders of USCC Common Shares consists of equity securities of TDS,
then, notwithstanding any provision of this Statement to the contrary,
upon the subsequent redemption of the Series QQ Preferred Shares, each
Series QQ Preferred Share tendered to the Corporation for redemption
pursuant to subparagraph (c)(2) or (d)(1) above shall be redeemed by
the Corporation on the Redemption Date specified in the redemption
notice (and otherwise permitted by this Statement) by delivering that
number of TDS Common Shares having a Market Value as of the effective
date of such Going Private Transaction equal to the Market Value on
such date of that number of USCC Common Shares for which such
Series QQ Preferred Share might have been redeemed immediately prior
to such Going Private Transaction, plus that number of USCC Common
Shares which the holder of such Series QQ Preferred Share would have
been entitled to receive if all of the additional Series QQ Preferred
Shares to be issued in payments of accrued dividends for the first
thirteen quarters after September 30, 1991, pursuant to the proviso in
paragraph (b) above, had been issued and immediately redeemed for USCC
Common Shares on the last business day immediately preceding the
effective date of such Going Private Transaction. The TDS Common
Shares to be delivered pursuant to this clause (d)(4)(C) shall be
subject to adjustment from time to time after the effective date of a
Going Private Transaction of the type referred to in this clause
pursuant to clauses (d)(4)(A) and (B) as if such clauses referred to
TDS and TDS Common Shares rather than USCC and USCC Common Shares,
respectively.
(D) No adjustment in the number of TDS or USCC Common Shares, as
the case may be, to which any holder is entitled pursuant to the
application of clause (d)(4)(A) above shall be required unless such
adjustment would require an increase or decrease of at least 1/10th of
a TDS or USCC Common Share, as the case may be; provided, however,
that any adjustments which by reason of this clause (D) are not
required to be made shall be carried forward and taken into account in
any subsequent adjustment.
(5) Each holder who has given notice pursuant to subparagraph (d)(1)
above shall deliver the certificate representing the Series QQ Preferred
Shares to be redeemed to the Corporation with the notice of the redemption.
In case fewer than all the shares represented by any certificate are
redeemed, a new certificate shall be issued representing the unredeemed
shares.
(e) REDEMPTION IN THE EVENT OF ORGANIC CHANGE-In case USCC shall propose
to effect any reorganization or reclassification of USCC Common Shares,
consolidate or merge with another corporation, or sell to another corporation
all or substantially all of its assets in such a way that holders of its
outstanding USCC Common Shares shall be entitled to receive (either directly or
upon subsequent liquidation) stock, securities, cash or other property with
respect to or in exchange for such USCC Common Shares (collectively, any
"Organic Change"), and immediately after such Organic Change TDS or USCC would
no longer be under common control within the meaning of Rule 405 promulgated by
the Securities and Exchange Commission (the "SEC") under the Securities Act of
1933, as amended (a "Disaffiliation Transaction"), or USCC or TDS shall propose
to effect any transaction or series of transactions of the type described in
paragraph (a)(3)(i) of Rule 13e-3 promulgated by the SEC under the Securities
Exchange Act of 1934, as amended, in which USCC is the "issuer", which has one
of the effects described in paragraph (a)(3)(ii) of such Rule (a "Going Private
Transaction"), and in which
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the consideration to be received by the holders of USCC Common Shares is
something other than equity securities of TDS, then TDS shall deliver a
notice of redemption (as described in subparagraph (c)(3) above) to each
holder of Series QQ Preferred Shares at least ten business days prior to the
earliest date (the "Effective Date") on which holders of USCC Common Shares
shall become entitled to receive stock, securities, cash or other property in
connection with such Disaffiliation Transaction or such Going Private
Transaction. Such notice of redemption shall specify the Effective Date and
each Series QQ Preferred Share shall be redeemed on a date (the "Accelerated
Redemption Date") which is not later than the last business day preceding
such Effective Date by the delivery by the Corporation of that number of USCC
Common Shares for which such Series QQ Preferred Share might have been
redeemed immediately prior to such Disaffiliation Transaction or such Going
Private Transaction, plus that number of USCC Common Shares which the holder
of such Series QQ Preferred Share would have been entitled to receive if all
of the additional Series QQ Preferred Shares to be issued in payment of
accrued dividends for the first thirteen fiscal quarters after September 30,
1991, pursuant to the proviso in paragraph (b) above, had been issued and
immediately redeemed for USCC Common Shares on the Accelerated Redemption
Date.
(f) NO FRACTIONAL SHARES-No fractional TDS Common Shares or USCC Common
Shares shall be issued upon the redemption of Series QQ Preferred Shares, nor
shall cash adjustments be made for fractional shares upon such redemption.
(g) TERMINOLOGY-For purposes of this Statement, the term "TDS Common
Shares" and the term "USCC Common Shares" shall mean (A) the class of stock
designated as the Common Shares of the Corporation and the Common Shares of
USCC, respectively, on the date this Statement is filed with the Delaware
Secretary of State, or (B) any other class of stock resulting from successive
changes or reclassifications of such class consisting solely of a change in par
value, or a change from no par value to par value.
(h) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series QQ Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
QQ Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(i) PREFERENCE VALUE IN LIQUIDATION-The amount payable upon each Series QQ
Preferred Share in the event of either voluntary or involuntary liquidation
shall be $100.00.
SS. $5.50 CUMULATIVE CONVERTIBLE AND REDEEMABLE VOTING SERIES SS PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of the series of Preferred Shares created
by this resolution shall be "$5.50 Cumulative Convertible and Redeemable Voting
Series SS Preferred Shares" (hereinafter referred to as the "Series SS Preferred
Shares").
(b) DIVIDENDS-Each holder of a Series SS Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, out of funds of the Corporation legally available therefor,
cumulative dividends during each fiscal quarter to the extent set forth below.
Such dividends shall be cumulative from and shall commence to accrue (whether or
not declared) on the date of original issuance of such Series SS Preferred
Shares (the "Issue Date"), at a per annum dividend rate of five dollars and
fifty cents ($5.50) per share.
(c) REDEMPTION-
(1) On or after the fifth anniversary of the Issue Date, the
Series SS Preferred Shares shall be redeemable, in whole or in part from
time to time, at the option of the Corporation, on a date (the "Optional
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Redemption Date") which is the first business day after a dividend payment
date, pursuant to a notice as provided in subparagraph (c)(3) hereof, at a
redemption price (the "Optional Redemption Price") equal to the sum of
(A) $100.00 for each Series SS Preferred Share called for redemption plus
(B) all dividends accrued and unpaid thereon through the Optional
Redemption Date. The Optional Redemption Price payable on any Optional
Redemption Date shall be payable (i) in cash (by certified check), or
(ii) in the event that the Average Closing Price (as defined below) for the
Common Shares of the Corporation exceeds $44.44, then, at the option of the
Corporation (to be exercised, if at all, in its notice of redemption) by
(I) the issuance to the record holder of the Series SS Preferred Shares
being redeemed of 2.25 Common Shares (subject to adjustment as set forth in
paragraph (e)(2) hereof) for each Series SS Preferred Share so redeemed
plus (II) the payment in cash of all dividends accrued and unpaid thereon
through the Optional Redemption Date. If a holder, subsequent to receiving
a notice of redemption of less than all of such holder's Series SS
Preferred Shares and at least fifteen (15) days prior to the Redemption
Date, elects to convert any Series SS Preferred Shares, then the number of
shares to be redeemed from such holder on such Redemption Date shall be
reduced by the lesser of (x) the number of Series SS Preferred Shares
called for redemption from such holder and (y) the number of such shares
converted by such holder. For purposes hereof, the term "Average Closing
Price" shall mean the arithmetical average of the closing price on the
American Stock Exchange of the Common Shares of the Corporation for the
five trading days ending on the fifth business day preceding the relevant
Redemption Date and, if the Common Shares of the Corporation are not listed
on the American Stock Exchange then, in order, if more than one applies,
the arithmetical average of the closing price of such Common Shares on any
national securities exchange or on any regional securities exchange, the
highest bid price quoted through the National Association of Securities
Dealers Automated Quotation System, or the highest bid price reported by
dealers in the over-the-counter market.
(2) If an Optional Redemption Date has not occurred by the tenth
anniversary of the Issue Date (the "Mandatory Redemption Date" and,
together with the Optional Redemption Date, the "Redemption Date"), the
Corporation shall, on the Mandatory Redemption Date, redeem all Series SS
Preferred Shares then outstanding at a redemption price (the "Mandatory
Redemption Price" and, together with the Optional Redemption Price, the
"Redemption Price") equal to the sum of (A) $100.00 for each Series SS
Preferred Share outstanding on the Mandatory Redemption Date plus (B) all
dividends accrued and unpaid thereon through the Mandatory Redemption Date.
The Mandatory Redemption Price shall be payable in cash by certified check.
(3) Notice of (A) an election under the redemption provision in
subparagraph (c)(1) above, or (B) the Mandatory Redemption Date, shall be
mailed (by registered mail, return receipt requested) to each holder of
Series SS Preferred Shares to be redeemed at the address appearing on the
records of the Corporation not less than sixty (60) days prior to the
Redemption Date. If, on or before the Redemption Date specified in such
notice, the funds or Common Shares necessary for such redemption shall have
been set aside by the Corporation so as to be available for payment to the
holder of Series SS Preferred Shares so called for redemption upon such
holder's surrender of such Series SS Preferred Shares to the Corporation,
then, notwithstanding that any certificate representing Series SS Preferred
Shares so called for redemption shall not have been surrendered for
cancellation, the dividends thereon shall cease to accrue from and after
the Redemption Date, and all rights with respect to such Series SS
Preferred Shares so called for redemption, including any right to vote or
otherwise participate in the determination of any proposed corporate
action, shall terminate at the close of business on such Redemption Date,
except only the right of the holder to receive the Redemption Price
therefor, but without interest.
(4) Each such notice of redemption shall state:
(A) the Redemption Date;
(B) the number of Series SS Preferred Shares to be redeemed and,
if less than all the shares held by such holder are to be redeemed
from such holder, the number of shares to be redeemed from such holder
(subject in each case to the right of the holder to convert such
shares prior to the Redemption Date);
(C) in the case of an Optional Redemption Date, whether the
Optional Redemption Price will be paid in cash (by certified check)
or, in the event the Average Closing Price exceeds $44.44, by the
issuance of Common Shares of the Corporation;
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(D) the place where certificates for such shares are to be
surrendered for payment of the Redemption Price; and
(E) that dividends on the shares to be redeemed shall cease to
accrue on such Redemption Date.
(5) On or after a Redemption Date, each holder of shares of Series SS
Preferred Shares to be redeemed shall present and surrender the certificate
or certificates for such shares to the Corporation at the place designated
in such notice and thereupon the Redemption Price of such shares shall be
paid to or on the order of the person whose name appears on such
certificate or certificates as the owner thereof and each surrendered
certificate shall be cancelled. In case fewer than all the shares
represented by such certificate are redeemed, a new certificate shall be
issued representing the unredeemed shares. From and after a Redemption Date
(unless the Corporation shall default in payment of the Redemption Price)
all dividends on the Series SS Preferred Shares designated for redemption
in such notice shall cease to accrue, and all rights of the holders thereof
as shareholders of the Corporation, except the right to receive the
Redemption Price thereof, without interest, upon the surrender of
certificates representing the same, shall cease and terminate and such
shares shall not thereafter be transferred (except with the consent of the
Corporation) on the books of the Corporation and such shares shall not be
deemed to be outstanding for any purpose whatsoever.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series SS Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
SS Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) CONVERSION-
(1) At any time and from time to time after the Issue Date, any
holder of Series SS Preferred Shares may convert all or any portion of the
Series SS Preferred Shares held by such holder into Common Shares at a
conversion ratio (subject to adjustment as set forth below) of 2.25 Common
Shares for each Series SS Preferred Share so converted; provided, however,
that, in the case of Series SS Preferred Shares called for redemption or
shares to be redeemed on the Mandatory Redemption Date, the right of the
holder thereof to convert such shares shall expire fifteen (15) days prior
to the Redemption Date. A holder of Series SS Preferred Shares shall be
entitled to receive in exchange therefor certificates for the fully paid
and non-assessable Common Shares of the Corporation at the rate aforesaid
(with the aggregate number of such Common Shares rounded to the nearest
whole share) within fifteen (15) days following presentation and surrender
by such holder to the Corporation at its offices of the certificates
representing the Series SS Preferred Shares to be converted (the
"Conversion Date"), all under suitable regulations (which shall not be
inconsistent with the provisions hereof, which shall not materially impair
the rights of the holder, and of which the holder shall receive advance
notice) to be prescribed by the board of directors of the Corporation.
Conversion of Series SS Preferred Shares in the manner aforesaid shall not
affect the right of the converting holder thereof to receive (on the
Conversion Date if such dividends shall be legally payable by the
Corporation on such date, or as promptly after the Conversion Date as such
dividends shall be legally payable) dividends accrued but unpaid thereon as
of any dividend payment date prior to the Conversion Date.
(2) The number of Common Shares to be exchanged for each Series SS
Preferred Share that is converted pursuant to subparagraph (e)(1) or
redeemed in accordance with subparagraph (c)(1) shall be subject to
adjustment from time to time as set forth in clauses (A) and (B) of this
subparagraph (2):
(A) In the event the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation, (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares or (iv) issue by reclassification of
its Common Shares (whether
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pursuant to a merger or consolidation or otherwise) any shares of
the Corporation, then the holder of each Series SS Preferred Share
shall be entitled to receive in exchange for such share upon the
conversion or redemption thereof the number of shares of the
Corporation which such holder would have owned or would have been
entitled to receive after the happening of any of the events
described above had such share been converted immediately prior to
the happening of such event. The adjustments provided for in this
clause (A) shall be cumulative if more than one event requiring an
adjustment shall occur between the Issue Date and the Conversion
Date or Redemption Date, as the case may be.
(B) No adjustment pursuant to this paragraph (e) shall be
required unless such adjustment would require an increase or decrease
in such rate of at least one-tenth (1/10) of a Common Share; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment.
(C) Promptly after any adjustment pursuant to this paragraph
(e), the Corporation shall give written notice thereof to all holders
of Series SS Preferred Shares, setting forth in reasonable detail and
certifying the calculation of such adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series SS Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series SS Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series SS Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For purposes of this paragraph (e), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation on the date this Statement is filed with the Delaware Secretary
of State, or (B) any other class of stock resulting from successive changes
or reclassification of such class consisting solely of a change in par
value, or a change from no par value to par value.
(6) Each notice of conversion shall state the number of Series SS
Preferred Shares to be converted, if less than all the shares held by such
holder. In case fewer than all the shares represented by such certificate
are converted, a new certificate shall be issued representing the
unconverted shares. From and after the Conversion Date (unless the
Corporation shall default in issuing the Common Shares on the Conversion
Date), all dividends on such converted shares of Series SS Preferred Shares
shall cease to accrue and such shares shall not be outstanding for any
purpose whatsoever.
(f) PREFERENCE VALUE IN LIQUIDATION-The amount payable with respect to
each Series SS Preferred Share in the event of either voluntary or involuntary
liquidation of the Corporation shall be $100.00, plus a sum equal to the amount
of all dividends accrued and unpaid thereon.
TT. $5.00 CUMULATIVE CONVERTIBLE AND REDEEMABLE VOTING SERIES TT PREFERRED
SHARES, $.01 PAR VALUE, LIQUIDATION VALUE $100.00 PER SHARE
(a) DESIGNATION-The designation of the series of Preferred Shares created
by this resolution shall be "$5.00 Cumulative Convertible and Redeemable Voting
Series TT Preferred Shares" (hereinafter referred to as the "Series TT Preferred
Shares").
(b) DIVIDENDS-Each holder of a Series TT Preferred Share shall be entitled
to receive, when, as and if declared by the board of directors of the
Corporation, out of funds of the Corporation legally available therefor,
cumulative dividends during each fiscal quarter to the extent set forth below.
Such dividends shall be cumulative from and shall commence to accrue (whether or
not declared) on the date of original issuance of such Series TT Preferred
Shares (the "Issue Date"), at a per annum dividend rate of five dollars ($5.00)
per share.
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(c) REDEMPTION-
(1) On or after the tenth anniversary of the Issue Date, the
Series TT Preferred Shares shall be redeemable, in whole or in part from
time to time, at the option of the Corporation, on a date (the "Redemption
Date") which is the first business day after a dividend payment date,
pursuant to a notice as provided in subparagraph (c)(2) hereof, at a
redemption price (the "Redemption Price") equal to the sum of (A) $100.00
for each Series TT Preferred Share called for redemption plus (B) all
dividends accrued and unpaid thereon through the Redemption Date. The
Redemption Price payable on any Redemption Date shall be payable (i) in
cash (by certified check), or (ii) by the issuance of Common Shares of the
Corporation to the record holder of such Series TT Preferred Shares being
redeemed. In the event that the Corporation elects to pay the Redemption
Price by issuing its Common Shares, the number of Common Shares to be
issued shall be calculated (and rounded to the nearest whole share) based
upon the arithmetical average of the closing price on the American Stock
Exchange (or, if the Corporation's Common Shares are not listed on the
American Stock Exchange (in order if more than one applies), the closing
price of such Common Shares on any national securities exchange or on any
regional securities exchange, the highest bid price quoted through the
National Association of Securities Dealers Automated Quotation System, or
the highest bid price reported by dealers in the over-the-counter market)
of the Corporation's Common Shares for the thirty (30) trading days ending
on the third trading day prior to the Redemption Date. If a holder,
subsequent to receiving a notice of redemption of such holder's Series TT
Preferred Shares and at least fifteen (15) days prior to the Redemption
Date, properly elects to convert any Series TT Preferred Shares, then the
number of shares to be redeemed from such holder on such Redemption Date
shall be reduced by the lesser of (x) the number of Series TT Preferred
Shares called for redemption from such holder and (y) the number of such
shares converted by such holder.
(2) Notice of an election under the redemption provision in
subparagraph (c)(1) above shall be mailed (by registered mail, return
receipt requested) to each holder of Series TT Preferred Shares to be
redeemed at the address appearing on the records of the Corporation not
less than sixty (60) days prior to the Redemption Date. If, on or before
the Redemption Date specified in such notice, the funds or Common Shares
necessary for such redemption shall have been set aside by the Corporation
so as to be available for payment to the holder of Series TT Preferred
Shares so called for redemption upon such holder's surrender of such
Series TT Preferred Shares to the Corporation, then, notwithstanding that
any certificate representing Series TT Preferred Shares so called for
redemption shall not have been surrendered for cancellation, the dividends
thereon shall cease to accrue from and after the Redemption Date, and all
rights with respect to such Series TT Preferred Shares so called for
redemption, including any right to vote or otherwise participate in the
determination of any proposed corporate action, shall terminate at the
close of business on such Redemption Date, except only the right of the
holder to receive the Redemption Price therefor, but without interest.
(3) Each such notice of redemption shall state:
(A) the Redemption Date;
(B) the number of Series TT Preferred Shares to be redeemed and,
if less than all the shares held by such holder are to be redeemed
from such holder, the number of shares to be redeemed from such holder
(subject, if applicable, to the right of the holder to convert such
shares prior to the Redemption Date);
(C) whether the Redemption Price will be paid in cash (by
certified check) or by the issuance of Common Shares of the
Corporation;
(D) the place where certificates for such shares are to be
surrendered for payment of the Redemption Price; and
(E) that dividends on the shares to be redeemed shall cease to
accrue on such Redemption Date.
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(4) On or after a Redemption Date, each holder of shares of Series TT
Preferred Shares to be redeemed shall present and surrender the certificate
or certificates for such shares to the Corporation at the place designated
in such notice and thereupon the Redemption Price of such shares shall be
paid to or on the order of the person whose name appears on such
certificate or certificates as the owner thereof and each surrendered
certificate shall be canceled. In case fewer than all the shares
represented by such certificate are redeemed, a new certificate shall be
issued representing the unredeemed shares. From and after a Redemption Date
(unless the Corporation shall default in payment of the Redemption Price)
all dividends on the Series TT Preferred Shares designated for redemption
in such notice shall cease to accrue, and all rights of the holders thereof
as shareholders of the Corporation, except the right to receive the
Redemption Price thereof, without interest, upon the surrender of
certificates representing the same, shall cease and terminate and such
shares shall not thereafter be transferred (except with the consent of the
Corporation) on the books of the Corporation and such shares shall not be
deemed to be outstanding for any purpose whatsoever.
(d) VOTING RIGHTS-
(1) With respect to all matters, each holder of Series TT Preferred
Shares shall be entitled to one vote for each share of such stock standing
in the name of the holder on the books of the Corporation.
(2) With respect to the election of directors, the holders of Series
TT Preferred Shares shall have class voting rights (voting together with
the holders of (A) other Preferred Shares that are entitled to vote thereon
and that were issued after October 31, 1981, and (B) Series A Common
Shares) to the extent provided in Article IV of the Restated Certificate of
Incorporation of the Corporation.
(e) CONVERSION-
(1) At any time and from time to time for the period commencing on
the Issue Date and terminating on the tenth anniversary of the Issue Date,
any holder of Series TT Preferred Shares may convert all or any portion of
the Series TT Preferred Shares held by such holder into Common Shares at a
conversion ratio (subject to adjustment as set forth below) of 1.818 Common
Shares for each Series TT Preferred Share so converted; provided, however,
that, in the case of Series TT Preferred Shares called for redemption, the
right of the holder thereof to convert such shares shall expire fifteen
(15) days prior to the Redemption Date. A holder of Series TT Preferred
Shares shall be entitled to receive in exchange therefor certificates for
the fully paid and non-assessable Common Shares of the Corporation at the
rate aforesaid (with the aggregate number of such Common Shares rounded to
the nearest whole share) within fifteen (15) days following presentation
and surrender by such holder to the Corporation at its offices of the
certificates representing the Series TT Preferred Shares to be converted
(the "Conversion Date"), all under suitable regulations (which shall not be
inconsistent with the provisions hereof, which shall not materially impair
the rights of the holder, and of which the holder shall receive advance
notice) to be prescribed by the board of directors of the Corporation.
Conversion of Series TT Preferred Shares in the manner aforesaid shall not
affect the right of the converting holder thereof to receive (on the
Conversion Date if such dividends shall be legally payable by the
Corporation on such date, or as promptly after the Conversion Date as such
dividends shall be legally payable) dividends accrued but unpaid thereon as
of any dividend payment date prior to the Conversion Date.
(2) The number of Common Shares to be exchanged for each Series TT
Preferred Share that is converted pursuant to subparagraph (e)(1) or
redeemed in accordance with subparagraph (c)(1) shall be subject to
adjustment from time to time as set forth in clauses (A) and (B) of this
subparagraph (2):
(A) In the event the Corporation shall (i) pay a dividend on its
Common Shares in shares of the Corporation, (ii) subdivide its
outstanding Common Shares, (iii) combine the outstanding Common Shares
into a smaller number of shares or (iv) issue by reclassification of
its Common Shares (whether pursuant to a merger or consolidation or
otherwise) any shares of the Corporation, then the holder of each
Series TT Preferred Share shall be entitled to receive in exchange for
such share upon the conversion or redemption thereof the number of
shares of the Corporation which such holder would have owned or would
have been entitled to receive after the happening of any of the events
described above had such share been converted immediately prior to the
happening of such event. The adjustments provided for in
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this clause (A) shall be cumulative if more than one event requiring
an adjustment shall occur between the Issue Date and the Conversion
Date or Redemption Date, as the case may be.
(B) No adjustment pursuant to this paragraph (e) shall be
required unless such adjustment would require an increase or decrease
in such rate of at least one-tenth (1/10) of a Common Share; provided,
however, that any adjustments which by reason of this clause (B) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment.
(C) Promptly after any adjustment pursuant to this paragraph
(e), the Corporation shall give written notice thereof to all holders
of Series TT Preferred Shares, setting forth in reasonable detail and
certifying the calculation of such adjustment.
(3) The Corporation shall at all times reserve and keep available out
of its authorized Common Shares, solely for the purpose of issuance upon
conversion of Series TT Preferred Shares as herein provided, such number of
Common Shares as shall then be issuable upon the conversion of all
outstanding Series TT Preferred Shares.
(4) Fractional Common Shares shall not be issued upon conversion of
Series TT Preferred Shares, nor shall cash adjustments be made for
fractional shares upon such conversion.
(5) For purposes of this paragraph (e), the term "Common Shares"
shall mean (A) the class of stock designated as the Common Shares of the
Corporation on the date this Statement is filed with the Delaware Secretary
of State, or (B) any other class of stock resulting from successive changes
or reclassification of such class consisting solely of a change in par
value, or a change from no par value to par value.
(6) Each notice of conversion shall state the number of Series TT
Preferred Shares to be converted, if less than all the shares held by such
holder. In case fewer than all the shares represented by such certificate
are converted, a new certificate shall be issued representing the
unconverted shares. From and after the Conversion Date (unless the
Corporation shall default in issuing the Common Shares on the Conversion
Date), all dividends on such converted shares of Series TT Preferred Shares
shall cease to accrue and such shares shall not be outstanding for any
purpose whatsoever.
(f) PREFERENCE VALUE IN LIQUIDATION-The amount payable with respect to
each Series TT Preferred Share in the event of either voluntary or involuntary
liquidation of the Corporation shall be $100.00, plus a sum equal to the amount
of all dividends accrued and unpaid thereon.
* * * * * * * *
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EXHIBIT 3.2
RESTATED BYLAWS
OF
TELEPHONE AND DATA SYSTEMS, INC.
(a Delaware corporation)
ARTICLE I
STOCKHOLDERS
SECTION 1.1 ANNUAL MEETING. The annual meeting of stockholders
for the election of directors and the transaction of such other business as
may properly come before such meeting shall be held on the first Wednesday of
May of each year, or on such other date, and at such time and place, within
or without the State of Delaware, as shall be determined by resolution of the
Board of Directors. If the day fixed for the annual meeting is a legal
holiday, such meeting shall be held on the next succeeding business day. If
the election of directors shall not be held on the day designated herein for
the annual meeting of stockholders, or at any adjournment thereof, the Board
of Directors shall cause such election to be held at a meeting of
stockholders to be called as soon thereafter as is convenient.
SECTION 1.2 SPECIAL MEETINGS. Special meetings of stockholders
may be called by the Board of Directors, by the Chairman or President and
shall be called by the President or the Secretary at the request in writing,
stating the purpose or purposes thereof, of holders of at least fifty percent
of the voting power of the capital stock of the Corporation issued and
outstanding and entitled to vote thereat. Special meetings of stockholders
may be held at such time and place, within or without the State of Delaware,
as shall be determined by resolution of the Board of Directors or as may be
specified in the call of any such special meeting. If not otherwise
designated, the place of any special meeting shall be the principal office of
the Corporation in the State of Illinois.
SECTION 1.3 NOTICE OF MEETINGS AND ADJOURNED MEETINGS. Written
notice of every meeting of stockholders, stating the place, date, time and
purposes thereof, shall, except when otherwise required by the Restated
Certificate of Incorporation of the Corporation, as it may be amended from
time to time (the "Restated Certificate of Incorporation"), or the laws of
the State of Delaware, be given at least 10 but not more than 60 days prior
to such meeting to each stockholder of record entitled to vote thereat, in
the manner set forth in Section 9.1 of these Bylaws, by or at the direction
of the President or the Secretary or the persons calling such meeting. Any
meeting at which a quorum of stockholders is present, in person or by proxy,
may be adjourned from time to time without notice, other than by announcement
at such meeting, until its business shall be completed. At such adjourned
meeting, any business may be transacted which might have been transacted at
the original meeting. If the adjournment is for more than 30 days, or if
after the adjournment a new record date is fixed for the adjourned meeting,
written notice of the adjourned meeting shall be given to each stockholder of
record entitled to vote thereat as above provided.
SECTION 1.4 QUORUM. Except as otherwise provided by the laws of
the State of Delaware or the Restated Certificate of Incorporation, a majority
of the voting power of shares of capital stock of the Corporation entitled to
vote, represented in person or by proxy, shall constitute a quorum at any
meeting of stockholders, notwithstanding the subsequent withdrawal of enough
stockholders to leave less than a quorum. If at any meeting a quorum shall not
be present, the chairman of such meeting shall, if approved by the affirmative
vote of a majority of the voting power of shares of capital stock of the
Corporation so represented, adjourn such meeting to another time and/or place
without notice other than announcement at such meeting. If the adjournment is
for more than 30 days, or if after the adjournment a new record date is fixed
for the adjourned meeting, written notice of the adjourned meeting shall be
given to each stockholder of record entitled to vote thereat as above provided.
At such adjourned meeting, if a quorum shall be present or represented, any
business may be transacted which might have been transacted at the original
meeting, notwithstanding the subsequent withdrawal of enough stockholders to
leave less than a quorum.
SECTION 1.5 VOTING.
(a) Unless otherwise provided by law, the stockholders entitled
to vote at any meeting of stockholders and the number of votes to which such
stockholders are entitled shall be determined as provided in the Restated
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Certificate of Incorporation. Unless otherwise provided by law or in the
Restated Certificate of Incorporation, directors shall be elected by a
plurality of the votes cast in the election of directors. Each other
question shall, unless otherwise provided by law, the Restated Certificate of
Incorporation or these By-laws, be decided by the vote of the holders of
stock having a majority of the votes which could be cast by the holders of
all stock entitled to vote on such question which are present in person or by
proxy at the meeting.
(b) Where a separate vote by a class or group is required by the
laws of the State of Delaware, the Restated Certificate of Incorporation or
by these Bylaws, a majority of the voting power of the outstanding shares of
each such class or group present in person or represented by proxy, shall
constitute a quorum entitled to take action with respect to the vote on that
matter and the affirmative vote of a majority of the voting power of the
outstanding shares of each class or group present in person or represented by
proxy at the meeting shall be the act of each such class or group.
SECTION 1.6 PROXIES.
(a) At every meeting of stockholders, each stockholder having the
right to vote thereat shall be entitled to vote in person or by proxy. Such
proxy shall be filed with the Secretary before or at the time of the meeting.
No proxy shall be valid after eleven months from its date, unless such proxy
provides for a longer period.
(b) A stockholder may authorize another person or persons to act
for such stockholder as proxy (i) by executing a writing authorizing such
person or persons to act as such, which execution may be accomplished by such
stockholder or such stockholder's authorized officer, director, employee or
agent signing such writing or causing his or her signature to be affixed to
such writing by any reasonable means, including, but not limited to,
facsimile signature, or (ii) by transmitting or authorizing the transmission
of a telegram, cablegram or other means of electronic transmission (a
"Transmission") to the person who will be the holder of the proxy or to a
proxy solicitation firm, proxy support service organization or like agent
duly authorized by the person who will be the holder of the proxy to receive
such Transmission; PROVIDED, HOWEVER, that any such Transmission must either
set forth or be submitted with information from which it can be determined
that such Transmission was authorized by such stockholder. The inspector or
inspectors appointed pursuant to Section 1.10 of these Bylaws shall examine
Transmissions to determine if they are valid. If it is determined that a
Transmission is valid, the person or persons making that determination shall
specify the information upon which such person or persons relied. Any copy,
facsimile telecommunication or other reliable reproduction of such a writing
or such a Transmission may be substituted or used in lieu of the original
writing or Transmission for any and all purposes for which the original
writing or Transmission could be used; PROVIDED, HOWEVER, that such copy,
facsimile telecommunication or other reproduction shall be a complete
reproduction of the entire original writing or Transmission.
SECTION 1.7 FIXING DATE FOR DETERMINATION OF STOCKHOLDERS OF
RECORD.
(a) In order that the Corporation may determine the stockholders
entitled to notice of or to vote at any meeting of stockholders or any
adjournment thereof, the Board of Directors may fix a record date, which record
date shall not precede the date upon which the resolution fixing such record
date shall be adopted by the Board of Directors, and which record date shall not
be more than 60 nor less than 10 days before the date of such meeting. If no
such record date shall have been fixed by the Board of Directors, such record
date shall be at the close of business on the day next preceding the day on
which such notice is given or, if such notice is waived, at the close of
business on the day next preceding the day on which such meeting shall be held.
A determination of stockholders of record entitled to notice of or to vote at
any meeting of stockholders shall apply to any adjournment of such meeting;
PROVIDED, HOWEVER, that the Board of Directors may fix a new record date for the
adjourned meeting.
(b) In order that the Corporation may determine the stockholders
entitled to consent to corporate action in writing without a meeting, the
Board of Directors may fix a record date, which record date shall not precede
the date upon which the resolution fixing such record date shall be adopted
by the Board of Directors, and which record date shall not be more than 10
days after the date upon which such resolution shall be adopted. If no such
record date shall have been fixed by the Board of Directors, such record date
shall be, if no prior action by the Board of Directors shall be required by
the laws of the State of Delaware, the first date on which a signed written
consent setting forth the action taken or proposed to be taken shall be
delivered to the Corporation at its registered office in the State of
Delaware, at its principal place of business or to the Secretary. Delivery
made to the Corporation's registered office shall be by hand or by certified
or registered mail, return receipt requested. If no such record date shall
have been fixed by the Board of Directors and prior
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action by the Board of Directors shall be required by the laws of the State
of Delaware, such record date shall be at the close of business on the day on
which the Board of Directors shall adopt the resolution taking such prior
action.
(c) In order that the Corporation may determine the stockholders
entitled to receive payment of any dividend or other distribution or any
allotment of any rights or the stockholders entitled to exercise any rights
in respect of any change, conversion or exchange of any capital stock, or for
the purpose of any other lawful action, the Board of Directors may fix a
record date, which record date shall not precede the date upon which the
resolution fixing such record date shall be adopted by the Board of
Directors, and which record date shall not be more than 60 days prior to such
payment, allotment or other action. If no such record date shall have been
fixed, such record date shall be at the close of business on the day on which
the Board of Directors shall adopt the resolution relating to such payment,
allotment or other action.
SECTION 1.8 STOCKHOLDER LIST. The Secretary or any other
officer who has charge of the stock ledger of the Corporation shall prepare,
at least 10 days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at such meeting, arranged in alphabetical
order, and showing the address of each stockholder and the number of shares
registered in the name of each stockholder. Such list shall be open to the
examination of any stockholder, for any purpose germane to such meeting,
during ordinary business hours, for a period of at least 10 days prior to
such meeting, either at a place within the city where such meeting is to be
held, which place shall be specified in the notice of such meeting, or, if
not so specified, at the place where such meeting is to be held. The list
shall also be produced and kept at the time and place of such meeting during
the whole time thereof, and may be inspected by any stockholder who is
present. Such stock ledger shall be the only evidence as to who are the
stockholders entitled to examine such stock ledger, such list or the books of
the Corporation or to vote in person or by proxy at any meeting of
stockholders.
SECTION 1.9 VOTING OF SHARES BY CERTAIN HOLDERS. Shares of
capital stock of the Corporation standing in the name of another corporation,
domestic or foreign, and entitled to vote may be voted by such officer, agent
or proxy as the bylaws of such other corporation may prescribe or, in the
absence of such provision, as the Board of Directors of such other
corporation may determine.
Shares of capital stock of the Corporation standing in the name of
a deceased person, a minor, an incompetent or a corporation declared bankrupt
and entitled to vote may be voted by an administrator, executor, guardian,
conservator or trustee, as the case may be, either in person or by proxy,
without transfer of such shares into the name of the official so voting.
A stockholder whose shares of capital stock of the Corporation are
pledged shall be entitled to vote such shares unless on the transfer books of
the Corporation the pledgor has expressly empowered the pledgee to vote such
shares, in which case only the pledgee, or such pledgee's proxy, may
represent such shares and vote thereon.
Shares of capital stock of the Corporation belonging to the
Corporation, or to another corporation if a majority of the shares entitled
to vote in the election of directors of such other corporation shall be held
by the Corporation, shall not be voted at any meeting of stockholders and
shall not be counted in determining the total number of outstanding shares
for the purpose of determining whether a quorum is present. Nothing in this
Section 1.9 shall be construed to limit the right of the Corporation to vote
shares of capital stock of the Corporation held by it in a fiduciary capacity.
SECTION 1.10 VOTING PROCEDURES AND INSPECTORS OF ELECTIONS.
(a) The Board of Directors shall, in advance of any meeting of
stockholders, appoint one or more inspectors (individually an "Inspector,"
and collectively the "Inspectors") to act at such meeting and make a written
report thereof. The Board of Directors may designate one or more persons as
alternate Inspectors to replace any Inspector who shall fail to act. If no
Inspector or alternate shall be able to act at such meeting, the person
presiding at such meeting shall appoint one or more other persons to act as
Inspectors thereat. Each Inspector, before entering upon the discharge of his
or her duties, shall take and sign an oath faithfully to execute the duties
of Inspector with strict impartiality and according to the best of his or her
ability.
(b) The Inspectors shall (i) ascertain the number of shares of
capital stock of the Corporation outstanding and the voting power of each,
(ii) determine the shares of capital stock of the Corporation represented at
such meeting and the validity of proxies and ballots, (iii) count all votes
and ballots, (iv) determine and retain for a reasonable
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period a record of the disposition of any challenges made to any
determination by the Inspectors and (v) certify their determination of the
number of such shares represented at such meeting and their count of all
votes and ballots. The Inspectors may appoint or retain other persons or
entities to assist them in the performance of their duties.
(c) The date and time of the opening and the closing of the polls
for each matter upon which the stockholders will vote at such meeting shall
be announced at such meeting. No ballots, proxies or votes, nor any
revocations thereof or changes thereto, shall be accepted by the Inspectors
after the closing of the polls unless the Court of Chancery of the State of
Delaware upon application by any stockholder shall determine otherwise.
(d) In determining the validity and counting of proxies and
ballots, the Inspectors shall be limited to an examination of the proxies,
any envelopes submitted with such proxies, any information provided in
accordance with the second paragraph of Section 1.6 of these Bylaws, ballots
and the regular books and records of the Corporation, except that the
Inspectors may consider other reliable information for the limited purpose of
reconciling proxies and ballots submitted by or on behalf of banks, brokers,
their nominees or similar persons which represent more votes than the holder
of a proxy is authorized by a stockholder of record to cast or more votes
than such stockholder holds of record. If the Inspectors consider other
reliable information for the limited purpose permitted herein, the
Inspectors, at the time they make their certification pursuant to paragraph
(b) of this Section 1.10, shall specify the precise information considered by
them, including the person or persons from whom they obtained such
information, when the information was obtained, the means by which such
information was obtained and the basis for the Inspectors' belief that such
information is accurate and reliable.
SECTION 1.11 CONSENT OF STOCKHOLDERS IN LIEU OF MEETING. Any
action required to be taken or which may be taken at any annual or special
meeting of stockholders may be taken without a meeting, without prior notice
and without a vote if a consent or consents in writing, setting forth the
action so taken, shall be signed by persons entitled to vote capital stock of
the Corporation representing not less than 90% of the voting power of the
shares that would be necessary to authorize or take such action at a meeting
at which all shares of capital stock of the Corporation entitled to vote
thereon were present and voted. Every written consent shall bear the date of
signature of each stockholder (or his, her or its proxy) who shall sign such
consent. Prompt notice of the taking of corporate action without a meeting
of stockholders by less than unanimous written consent shall be given to
those stockholders who shall not have consented in writing. All such written
consents shall be delivered to the Corporation at its registered office in
the State of Delaware, at its principal place of business or to the
Secretary. Delivery made to the Corporation's registered office shall be by
hand or by certified or registered mail, return receipt requested. No
written consent shall be effective to authorize or take the corporate action
referred to therein unless, within 60 days of the earliest dated written
consent delivered in the manner required by this Section 1.11 to the
Corporation, written consents signed by a sufficient number of persons to
authorize or take such action shall be delivered to the Corporation at its
registered office in the State of Delaware, at its principal place of
business or to the Secretary as aforesaid. All such written consents shall
be filed with the minutes of proceedings of the stockholders and actions
authorized or taken under such written consents shall have the same force and
effect as those adopted by vote of the stockholders at any annual or special
meeting thereof.
SECTION 1.12 INTRODUCTION OF BUSINESS AT A MEETING OF
STOCKHOLDERS. At an annual or special meeting of stockholders, only such
business shall be conducted, and only such proposals shall be acted upon, as
shall have been properly brought before an annual or special meeting of
stockholders. To be properly brought before an annual or special meeting of
stockholders, business must be (a) in the case of a special meeting,
specified in the notice of the special meeting (or any supplement thereto)
given by the Corporation, or (b) in the case of an annual meeting, properly
brought before the meeting by or at the direction of the Board of Directors,
or otherwise properly brought before the annual meeting by a stockholder.
For business to be properly brought before an annual meeting of stockholders
by a stockholder, the stockholder must have given timely notice thereof in
writing to the President or Secretary of the Corporation. To be timely, a
stockholder's notice must be received at the principal executive offices of
the Corporation not earlier than 120 calendar days nor later than 90 calendar
days in advance of the anniversary date of the date of the Corporation's
proxy statement to stockholders in connection with the most recent preceding
annual meeting of stockholders, except that if the date of the current year's
annual meeting has been changed by more than 30 calendar days from the
anniversary date of the most recent preceding annual meeting, a stockholder
proposal shall be received by the Corporation not later than the close of
business on the tenth day following the date of public notice of the date of
the current year's annual meeting; PROVIDED, HOWEVER, that, notwithstanding
the foregoing, for purposes of the annual meeting of stockholders to be held
in 1998, a stockholder's notice shall be timely if received by the
Corporation not later than the close of business on the tenth day following
the effective date of these Restated Bylaws.
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A stockholder's notice shall set forth as to each matter the
stockholder proposes to bring before an annual meeting of stockholders (a) a
brief description of the business desired to be brought before the annual
meeting and the reasons for conducting such business at the annual meeting,
(b) the name and address, as they appear on the Corporation's books, of the
stockholder proposing such business and any other stockholders known by such
stockholder to be supporting such proposal, (c) the class and number of
shares of the Corporation which are beneficially owned by such stockholder on
the date of such stockholder's notice and by any other stockholders known by
such stockholder to be supporting such proposal on the date of such
stockholder's notice and (d) any material interest of the stockholder in such
proposal.
Notwithstanding anything in the Bylaws to the contrary, no business
shall be conducted at a meeting of stockholders except in accordance with the
procedures set forth in this Section 1.12. The chairman of the meeting
shall, if the facts warrant, determine and declare to the meeting that the
business was not properly brought before the meeting in accordance with the
procedures prescribed by the Bylaws, and if he should so determine, he shall
so declare to the meeting and any such business not properly brought before
the meeting shall not be considered.
SECTION 1.13 NOMINATION OF DIRECTORS. Only persons nominated in
accordance with the procedures set forth in this section shall be eligible
for election as directors. Nominations of persons for election to the Board
may be made at a meeting of stockholders (a) by or at the direction of the
Board of Directors, or (b) by any stockholder of the Corporation entitled to
vote for the election of directors at such meeting who complies with the
notice procedures set forth in this Section 1.13. Such nominations, other
than those made by or at the direction of the Board of Directors, shall be
made pursuant to timely notice in writing to the President or Secretary of
the Corporation. To be timely, a stockholder's notice must be received at
the principal executive offices of the Corporation not earlier than 120
calendar days nor later than 90 calendar days in advance of the anniversary
date of the date of the Corporation's proxy statement to stockholders in
connection with the preceding year's annual meeting of stockholders, except
that if the date of the current year's annual meeting has been changed by
more than 30 calendar days from the anniversary date of the most recent
preceding annual meeting, a nomination shall be received by the Corporation
not later than the close of business on the tenth day following the date of
public notice of the date of the current year's annual meeting.
A stockholder's notice shall set forth (a) as to each person whom
the stockholder proposes to nominate for election or reelection as a director
(i) the name, age, business address and residence address of such person,
(ii) the principal occupation or employment of such person, (iii) the class
and number of shares of the Corporation which are beneficially owned by such
person on the date of such stockholder's notice and (iv) any other
information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required,
in each case pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended (including, without limitation, such person's written
consent to being named in the proxy statement as a nominee and to serving as
a director if elected); and (b) as to the stockholder giving the notice (i)
the name and address, as they appear on the Corporation's books, of such
stockholder and any other stockholders known by such stockholder to be
supporting such nominee and (ii) the class and number of shares of the
Corporation which are beneficially owned by such stockholder on the date of
such stockholder's notice and by any other stockholders known by such
stockholder to be supporting such nominee on the date of such stockholder's
notice.
No person shall be eligible for election as a director of the
Corporation unless nominated in accordance with the procedures set forth in
this section. The chairman of the meeting shall, if the facts warrant,
determine and declare to the meeting that a nomination was not made in
accordance with the procedures prescribed by the Bylaws, and if he should so
determine, he shall so declare to the meeting and the defective nomination
shall be disregarded.
This Section 1.13 shall not apply to the election of a director to
a directorship which may be filled by the Board of Directors under the
Delaware General Corporation Law.
ARTICLE II
DIRECTORS
SECTION 2.1 GENERAL POWERS. The business and affairs of the
Corporation shall be managed by or under the direction of the Board of
Directors.
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SECTION 2.2 STAGGERED BOARD. The Board of Directors shall
consist of twelve members, to be divided into three classes and the number of
directors of each class shall be as equal as possible. The term of office of
the second class shall expire at the annual meeting of the stockholders in
1998; the third class shall expire at the annual meeting of the stockholders
in 1999 and the first class shall expire at the annual meeting of the
stockholders in 2000. At each annual election, commencing at the next annual
meeting of stockholders, the successors to the class of directors whose term
expires in that year shall be elected to hold office for the term of three
years to succeed those whose term expires so that the term of office of one
class of directors shall expire in each year. Each director elected or
appointed shall serve until his successor shall be elected and qualify, or
until his earlier death, resignation, removal or disqualification.
SECTION 2.3 RESIGNATION OR REMOVAL. Any director may resign by
giving written notice to the Board of Directors or the President. Any such
resignation shall take effect at the time of receipt of such notice or at any
later time specified therein; and, unless otherwise specified therein,
acceptance of such resignation shall not be necessary to make it effective.
Directors may be removed from office, either with or without cause, only as
provided in the Restated Certificate of Incorporation or the laws of the
State of Delaware.
SECTION 2.4 VACANCIES.
(a) Except as otherwise required by the Restated Certificate of
Incorporation or the laws of the State of Delaware or these Bylaws, any
vacancy occurring in the Board of Directors, including a vacancy created by
an increase in the number of directors provided in Section 2.2 of these
Bylaws, may be filled for the remainder of the unexpired term by the
affirmative vote of a majority of the directors then in office, although less
than a quorum, by a sole remaining director or by the stockholders.
(b) Except as otherwise required by the Restated Certificate of
Incorporation, when one or more directors shall resign from the Board of
Directors, effective at a future date, a majority of the directors then in
office, including those who have so resigned, shall have the power to fill
such vacancy or vacancies, the vote thereon to take effect when such
resignation or resignations shall become effective, and each director so
chosen shall hold office for the remainder of the unexpired term of such
office.
SECTION 2.5 PLACE OF MEETINGS. Meetings of the Board of
Directors may be held at such places, within or without the State of
Delaware, as the Board of Directors may from time to time determine or as may
be specified in the call of any such meeting.
SECTION 2.6 REGULAR MEETINGS. A regular annual meeting of the
Board of Directors shall be held, without call or notice, immediately after
and at the same place as the annual meeting of stockholders, or at such other
time and place as may be fixed by resolution of the Board of Directors or
specified by the Secretary at the direction of the Chairman, for the purpose
of organizing the Board of Directors, electing officers and transacting any
other business that may properly come before such meeting. If the
stockholders shall elect the directors by written consent of stockholders as
permitted by Section 1.11 of these Bylaws, a special meeting of the Board of
Directors shall be called as soon as practicable after such election for the
purposes described in the preceding sentence. Additional regular meetings of
the Board of Directors may be held without call or notice at such times as
shall be fixed by resolution of the Board of Directors or specified by the
Secretary at the direction of the Chairman.
SECTION 2.7 SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by the Chairman, the President or by a majority of
the directors then in office. Notice of each special meeting shall be mailed
by the Secretary to each director at least three days before such meeting, or
be given by the Secretary personally or by telegraph or telecopy or by
electronic mail at least four hours before such meeting, in the manner set
forth in Section 9.1 of these Bylaws. Such notice shall set forth the date,
time and place of such meeting but need not, unless otherwise required by the
laws of the State of Delaware, state the purpose of such meeting.
SECTION 2.8 QUORUM AND VOTING. A majority of the entire Board
of Directors shall constitute a quorum for the transaction of business at any
meeting of the Board of Directors. The act of the majority of the directors
present at any meeting at which a quorum is present shall be the act of the
Board of Directors, unless otherwise provided by the laws of the State of
Delaware, the Restated Certificate of Incorporation or these Bylaws. A
majority of the directors present at
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any meeting at which a quorum shall be present may adjourn such meeting to
any other date, time or place without further notice other than announcement
at such meeting. If at any meeting a quorum shall not be present, a majority
of the directors present may adjourn such meeting to any other date, time or
place upon notice to all directors pursuant to Section 2.7.
SECTION 2.9 TELEPHONIC MEETINGS. Members of the Board of
Directors or of any committee designated by the Board of Directors may
participate in a meeting of the Board of Directors or such committee through
conference telephone or similar communications equipment by means of which
all persons participating in such meeting can hear each other, and
participation in any meeting conducted pursuant to this Section 2.9 shall
constitute presence in person at such meeting.
SECTION 2.10 COMPENSATION. Unless otherwise restricted by the
laws of the State of Delaware or the Restated Certificate of Incorporation,
the Board of Directors shall have the authority to fix the compensation of
directors. The directors shall be paid their reasonable expenses, if any, of
attendance at each meeting of the Board of Directors or a committee thereof
and may be paid a fixed sum for attendance at each such meeting and an annual
retainer or salary for services as a director or committee member. No such
payment shall preclude any director from serving the Corporation in any other
capacity and receiving compensation therefor.
SECTION 2.11 PRESUMPTION OF ASSENT. Unless otherwise provided by
the laws of the State of Delaware, a director who is present at a meeting of
the Board of Directors or a committee thereof at which action is taken on any
corporate matter shall be presumed to have assented to the action taken
unless his or her dissent shall be entered in the minutes of such meeting or
unless he or she shall file his or her written dissent to such action with
the person acting as secretary of such meeting before the adjournment thereof
or shall forward such dissent by registered mail to the Secretary immediately
after the adjournment of such meeting. Such right to dissent shall not apply
to a director who voted in favor of such action.
SECTION 2.12 ACTION WITHOUT MEETING. Unless otherwise restricted
by the laws of the State of Delaware, the Restated Certificate of
Incorporation or these Bylaws, any action required or permitted to be taken
at any meeting of the Board of Directors, or any committee thereof, may be
taken without a meeting if a written consent thereto is signed by all members
of the Board of Directors or of such committee, as the case may be, and such
written consent is filed with the minutes of proceedings of the Board of
Directors or such committee.
SECTION 2.13 PRESIDING OFFICER. The presiding officer at any
meeting of the Board of Directors shall be the Chairman or, in his or her
absence, the President, or in his or her absence, any other director elected
chairman by vote of a majority of the directors present at such meeting.
SECTION 2.14 EXECUTIVE COMMITTEE. The Board of Directors may, in
its discretion, by resolution passed by a majority of the entire Board of
Directors, designate an Executive Committee consisting of such number of
directors as the Board of Directors shall determine. The Executive Committee
shall have and may exercise all of the powers and authority of the Board of
Directors in the management of the business and affairs of the Corporation
with respect to any matter which may require action prior to, or which in the
opinion of the Executive Committee may be inconvenient, inappropriate or
undesirable to be postponed until, the next meeting of the Board of
Directors; PROVIDED, HOWEVER, that the Executive Committee shall not have the
power or authority of the Board of Directors in reference to (a) approving or
adopting, or recommending to the stockholders any action or matter expressly
required by Delaware law to be submitted to the stockholders for approval or
(b) adopting, amending or repealing these Bylaws.
SECTION 2.15 OTHER COMMITTEES. The Board of Directors may from
time to time, in its discretion, by resolution passed by a majority of the
entire Board of Directors, designate other committees of the Board of
Directors consisting of such number of directors as the Board of Directors
shall determine, which shall have and may exercise such lawfully delegable
powers and duties of the Board of Directors as shall be conferred or
authorized by such resolution. The Board of Directors shall have the power
to change at any time the members of any such committee, to fill vacancies
and to dissolve any such committee.
SECTION 2.16 ALTERNATES. The Board of Directors may from time to
time designate from among the directors alternates to serve on any committee
of the Board of Directors to replace any absent or disqualified member at any
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meeting of such committee. Whenever a quorum cannot be secured for any
meeting of any committee from among the regular members thereof and
designated alternates, the member or members, including alternates, of such
committee present at such meeting and not disqualified from voting, whether
or not constituting a quorum, may unanimously appoint another director to act
at such meeting in place of any absent or disqualified member.
SECTION 2.17 QUORUM AND MANNER OF ACTING OF COMMITTEES. A
majority of the members of any committee of the Board of Directors shall
constitute a quorum for the transaction of business at any meeting of such
committee, and the act of a majority of the members present at any meeting at
which a quorum is present shall be the act of such committee.
SECTION 2.18 COMMITTEE CHAIRMAN, BOOKS AND RECORDS, ETC. The
chairman of each committee of the Board of Directors shall be selected from
among the members of such committee by the Board of Directors.
Each committee shall keep a record of its acts and proceedings, and
all actions of each committee shall be reported to the Board of Directors at
its next meeting.
Each committee shall fix its own rules of procedure not
inconsistent with these Bylaws or the resolution of the Board of Directors
designating such committee and shall meet at such times and places and upon
such call or notice as shall be provided by such rules.
SECTION 2.19 RELIANCE UPON RECORDS. Every director, and every
member of any committee of the Board of Directors, shall, in the performance
of his or her duties, be fully protected in relying in good faith upon the
records of the Corporation and upon such information, opinions, reports or
statements presented to the Corporation by any of the Corporation's officers
or employees, or committees of the Board of Directors, or by any other person
as to matters the director or member reasonably believes are within such
other person's professional or expert competence and who has been selected
with reasonable care by or on behalf of the Corporation, including, but not
limited to, such records, information, opinions, reports or statements as to
the value and amount of the assets, liabilities and/or net profits of the
Corporation, or any other facts pertinent to the existence and amount of
surplus or other funds from which dividends might properly be declared and
paid, or with which the Corporation's capital stock might properly be
purchased or redeemed.
SECTION 2.20 INTERESTED DIRECTORS. The presence of a director,
who is directly or indirectly a party in a contract or transaction with the
Corporation, or between the Corporation and any other corporation,
partnership, association or other organization in which such director is a
director or officer or has a financial interest, may be counted in
determining whether a quorum is present at any meeting of the Board of
Directors or a committee thereof at which such contract or transaction is
discussed or authorized, and such director may participate in such meeting to
the extent permitted by applicable law, including Section 144 of the General
Corporation Law of the State of Delaware.
ARTICLE III
OFFICERS
SECTION 3.1 NUMBER AND DESIGNATION. The officers of the
Corporation shall be a Chairman, a President, one or more Vice Presidents, a
Secretary and a Treasurer, and such Assistant Secretaries, Assistant
Treasurers or other officers or agents as may be elected or appointed by the
Board of Directors. Any two or more offices may be held by the same person
unless the Restated Certificate of Incorporation or these Bylaws provide
otherwise.
SECTION 3.2 ELECTION AND TERM OF OFFICE. The officers of the
Corporation shall be elected by the Board of Directors at the first meeting
of the Board of Directors held after the election of directors. If the
election of officers shall not be held at such meeting, such election shall
be held as soon thereafter as may be convenient. Vacancies may be filled or
new offices created and filled at any meeting of the Board of Directors.
Each officer shall hold office until his or her successor shall have been
duly elected and shall have qualified or until his or her earlier death,
resignation, removal or disqualification.
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SECTION 3.3 REMOVAL AND RESIGNATION. Any officer or agent
elected or appointed by the Board of Directors may be removed by the Board of
Directors whenever in its judgment the best interests of the Corporation
would be served thereby, but such removal shall be without prejudice to the
contract rights, if any, of the person so removed. Any officer or agent may
resign at any time by giving written notice to the Board of Directors, to the
Chairman or to the Secretary. Any such resignation shall take effect at the
time of receipt of such notice or at any later time specified therein; and,
unless otherwise specified therein, acceptance of such resignation shall not
be necessary to make it effective.
SECTION 3.4 VACANCIES. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise may be filled by
the Board of Directors for the unexpired portion of the term.
SECTION 3.5 CHAIRMAN. The Chairman shall be the principal
officer of the Corporation. The Chairman may execute, alone or with the
Secretary or any other officer of the Corporation authorized by the Board of
Directors, any deeds, mortgages, bonds, contracts or other instruments which
the Board of Directors or a committee thereof has authorized to be executed,
except in cases where the execution thereof shall be expressly delegated by
the Board of Directors or a committee thereof or by these Bylaws to some
other officer or agent of the Corporation, or shall be required by law to be
otherwise executed, and in general he or she shall perform all duties
incident to the office of Chairman and such other duties as from time to time
may be prescribed by the Board of Directors or a committee thereof. When
present, he or she shall preside at all meetings of the stockholders and of
the Board of Directors.
SECTION 3.6 PRESIDENT. The President shall be the chief
executive officer of the Corporation and shall in general supervise and
control all of the business and affairs of the Corporation. In the absence
of the Chairman or in the event of his or her inability or refusal to act as
Chairman, the President shall perform the duties of the Chairman and, when so
acting, shall have all the powers of, and be subject to all the restrictions
placed upon the Chairman. He or she may execute, alone or with the Secretary
or any other officer of the Corporation authorized by the Board of Directors,
any deeds, mortgages, bonds, contracts or other instruments which the Board
of Directors or a committee thereof has authorized to be executed, except in
cases where the execution thereof shall be expressly delegated by the Board
of Directors or a committee thereof or by these Bylaws to some other officer
or agent of the Corporation, or shall be required by law to be otherwise
executed, and in general he or she shall perform all duties incident to the
office of President and such other duties as from time to time may be
prescribed by the Chairman, the Board of Directors or a committee thereof.
SECTION 3.7 THE VICE PRESIDENTS. In the absence of the
President or in the event of his or her inability or refusal to act, the
Chairman, or in the event of his or her inability or refusal to act, the Vice
President (or in the event there shall be more than one Vice President, the
Vice President determined or elected by the Board of Directors at the time)
shall perform the duties of the President and, when so acting, shall have all
the powers of and be subject to all the restrictions upon the President. The
Board of Directors may also designate certain Vice Presidents as being in
charge of designated divisions, plants or functions of the Corporation's
business and add appropriate descriptions to their titles. In addition, any
Vice President shall perform such duties as from time to time may be assigned
to him or her by the Chairman, the President or the Board of Directors.
SECTION 3.8 THE SECRETARY. The Secretary shall (a) keep the
minutes of proceedings of the stockholders, the Board of Directors and any
committee of the Board of Directors in one or more books provided for that
purpose; (b) see that all notices are duly given in accordance with the
provisions of these Bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the Corporation; (d) affix the seal of
the Corporation or a facsimile thereof, or cause it to be affixed, and, when
so affixed, attest the seal by his or her signature, to all Certificates for
shares of capital stock of the Corporation prior to the issue thereof and to
all other documents the execution of which on behalf of the Corporation under
its seal is duly authorized by the Board of Directors or otherwise in
accordance with the provisions of these Bylaws; (e) keep a register of the
post office address of each stockholder, director or committee member, which
shall be furnished to the Secretary by such stockholder, director or member;
(f) have general charge of the stock transfer books of the Corporation; and
(g) in general perform all duties incident to the office of Secretary and
such other duties as from time to time may be assigned to him or her by the
Chairman, the President or the Board of Directors.
SECTION 3.9 THE TREASURER. The Treasurer shall have charge and
custody of and be responsible for all funds and securities of the
Corporation, receive and give receipts for moneys due and payable to the
Corporation from any source whatsoever, deposit all such moneys in the name
of the Corporation in such banks, trust companies or other
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depositories as shall be selected in accordance with the provisions of
Article IV of these Bylaws, disburse the funds of the Corporation as ordered
by the Board of Directors, the Chairman or the President or as otherwise
required in the conduct of the business of the Corporation and render to the
Chairman, President or the Board of Directors, upon request, an accounting of
all his or her transactions as Treasurer and a report on the financial
condition of the Corporation. The Treasurer shall in general perform all the
duties incident to the office of Treasurer and such other duties as from time
to time may be assigned to him or her by the Chairman, President or the Board
of Directors. If required by the Board of Directors, the Treasurer shall
give a bond (which shall be renewed regularly), in such sum and with such
surety or sureties as the Board of Directors shall determine, for the
faithful discharge of his or her duties and for the restoration to the
Corporation, in case of his or her death, resignation, retirement or removal
from office, of all books, papers, vouchers, money and other property of
whatever kind in his or her possession or under his or her control belonging
to the Corporation.
SECTION 3.10 ASSISTANT TREASURERS AND SECRETARIES. In the
absence of the Secretary or the Treasurer, as the case may be, or in the
event of his or her inability or refusal to act, the Assistant Secretaries
and the Assistant Treasurers, respectively, in the order determined by the
Board of Directors (or if there shall have been no such determination, then
in the order of their election), shall perform the duties and exercise the
powers of the Secretary or the Treasurer, as the case may be. In addition,
the Assistant Secretaries and the Assistant Treasurers shall, in general,
perform such duties as may be assigned to them by the Chairman, the
President, the Secretary, the Treasurer or the Board of Directors. Each
Assistant Treasurer shall, if required by the Board of Directors, give a bond
(which shall be renewed regularly), in such sum and with such surety or
sureties as the Board of Directors shall determine, for the faithful
discharge of his or her duties.
SECTION 3.11 SALARIES. The salaries of the officers and agents
of the Corporation shall be fixed from time to time by the Board of Directors
or by such committee or officer as it shall designate for such purpose. No
officer shall be prevented from receiving such salary by reason of the fact
that he or she is also a director of the Corporation.
ARTICLE IV
CONTRACTS, LOANS, CHECKS, AND DEPOSITS
SECTION 4.1 CONTRACTS. The Board of Directors may authorize any
officer or officers, or agent or agents, to enter into any contract or
execute and deliver any instrument in the name of and on behalf of the
Corporation, and such authority may be general or confined to specific
instances.
SECTION 4.2 LOANS. No loans shall be contracted on behalf of the
Corporation and no evidences of indebtedness shall be issued in the name of the
Corporation unless authorized by or pursuant to a resolution adopted by the
Board of Directors. Such authority may be general or confined to specific
instances.
SECTION 4.3 CHECKS, DRAFTS, ETC. All checks, drafts or other
orders for payment of money issued in the name of the Corporation shall be
signed by such officers, employees or agents of the Corporation as shall from
time to time be designated by the Board of Directors, the Chairman, the
President or the Treasurer.
SECTION 4.4 DEPOSITS. All funds of the Corporation not
otherwise employed shall be deposited from time to time to the credit of the
Corporation in such banks, trust companies or other depositories as shall be
designated from time to time by the Board of Directors, the Chairman, the
President or the Treasurer; and such officers may designate any type of
depository arrangement (including, but not limited to, depository
arrangements resulting in net debits against the Corporation) as may from
time to time be offered or made available.
ARTICLE V
CERTIFICATES OF STOCK AND THEIR TRANSFER
SECTION 5.1 CERTIFICATES OF STOCK. Shares of capital stock of
the Corporation shall be represented by Certificates which shall be in such
form as may be determined by the Board of Directors, shall be numbered and
shall be
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entered on the books of the Corporation as they are issued. Such
Certificates shall indicate the holder's name and the number of shares
evidenced thereby and shall be signed by the Chairman, the President or a
Vice President and by the Secretary or an Assistant Secretary. If any stock
Certificate shall be manually signed (a) by a transfer agent or an assistant
transfer agent or (b) by a transfer clerk acting on behalf of the Corporation
and a registrar, the signature of any officer of the Corporation may be
facsimile. In case any such officer whose facsimile signature has been used
on any such stock Certificate shall cease to be such officer, whether because
of death, resignation, removal or otherwise, before such stock Certificate
shall have been delivered by the Corporation, such stock Certificate may
nevertheless be delivered by the Corporation as though the person whose
facsimile signature has been used thereon had not ceased to be such officer.
SECTION 5.2 LOST, STOLEN OR DESTROYED CERTIFICATES. The Board of
Directors in individual cases, or by general resolution or by delegation to the
transfer agent for the Corporation, may direct that a new stock Certificate or
Certificates for shares of capital stock of the Corporation be issued in place
of any stock Certificate or Certificates theretofore issued by the Corporation
claimed to have been lost, stolen or destroyed, upon the filing of an affidavit
to that effect by the person claiming such loss, theft or destruction. When
authorizing such an issuance of a new stock Certificate or Certificates, the
Board of Directors may, in its discretion and as a condition precedent to such
issuance, require the owner of such lost, stolen or destroyed stock Certificate
or Certificates to advertise the same in such manner as the Corporation shall
require and/or to give the Corporation a bond in such sum as it may direct as
indemnity against any claim that may be made against the Corporation with
respect to the stock Certificate or Certificates claimed to have been lost,
stolen or destroyed.
SECTION 5.3 TRANSFERS OF STOCK. Upon surrender to the
Corporation or the transfer agent of the Corporation of a stock Certificate
for shares of capital stock of the Corporation duly endorsed or accompanied
by proper evidence of succession, assignment or authority to transfer or, if
the relevant stock Certificate for shares of capital stock of the Corporation
is claimed to have been lost, stolen or destroyed, upon compliance with the
provisions of Section 5.2 of these Bylaws, and upon payment of applicable
taxes with respect to such transfer, and in compliance with any restrictions
on transfer applicable to such stock Certificate or the shares represented
thereby of which the Corporation shall have notice and subject to such rules
and regulations as the Board of Directors may from time to time deem
advisable concerning the transfer and registration of stock Certificates for
shares of capital stock of the Corporation, the Corporation shall issue a new
stock Certificate or Certificates for such shares to the person entitled
thereto, cancel the old stock Certificate and record the transaction upon its
books. Transfers of shares shall be made only on the books of the
Corporation by the registered holder thereof or by such holder's attorney or
successor duly authorized as evidenced by documents filed with the Secretary
or transfer agent of the Corporation. Whenever any transfer of shares of
capital stock of the Corporation shall be made for collateral security, and
not absolutely, it shall be so expressed in the entry of transfer if, when
the stock Certificate or Certificates representing such shares are presented
to the Corporation for transfer, both the transferor and transferee request
the Corporation to do so.
SECTION 5.4 STOCKHOLDERS OF RECORD. The Corporation shall be
entitled to treat the holder of record of any share of capital stock of the
Corporation as the holder thereof and shall not be bound to recognize any
equitable or other claim to or interest in such share on the part of any
other person, whether or not it shall have express or other notice thereof,
except as otherwise provided by the laws of the State of Delaware.
ARTICLE VI
GENERAL PROVISIONS
SECTION 6.1 FISCAL YEAR. The fiscal year of the Corporation
shall be the same as the calendar year.
SECTION 6.2 SEAL. The corporate seal of the Corporation shall
have inscribed thereon the name of the Corporation and the words "CORPORATE
SEAL" and "DELAWARE"; and it shall otherwise be in the form approved by the
Board of Directors. Such seal may be used by causing it, or a facsimile
thereof, to be impressed or affixed or otherwise reproduced.
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ARTICLE VII
OFFICES
SECTION 7.1 REGISTERED OFFICE. The registered office of the
Corporation in the State of Delaware shall be located at 1209 Orange Street
in the City of Wilmington, County of New Castle, and the name of its
registered agent is Corporation Trust Company.
SECTION 7.2 OTHER OFFICES. The Corporation may have offices at
such other places, both within or without the State of Delaware, as shall be
determined from time to time by the Board of Directors or as the business of
the Corporation may require.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 GENERAL.
(a) The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the
Corporation), by reason of the fact that he or she is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him or her in
connection with such action, suit or proceeding if he or she acted in good
faith and in a manner he or she reasonably believed to be in or not opposed
to the best interests of the Corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or her conduct
was unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement or conviction, or upon a plea of NOLO CONTENDERE or its
equivalent, shall not, of itself, create a presumption that such person did
not act in good faith and in a manner which he or she reasonably believed to
be in or not opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that his or her conduct was unlawful.
(b) The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he or she is or was a
director, officer, employee or agent of the Corporation, or is or was serving
at the request of the Corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection with the defense or
settlement of such action or suit if he or she acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the best
interests of the Corporation, except that no indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the Corporation unless and only to the extent that
the Court of Chancery of the State of Delaware or the court in which such
action or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which such Court of Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in paragraphs (a) and (b) of this Section
8.1, or in defense of any claim, issue or matter therein, he or she shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him or her in connection therewith.
(d) Any indemnification under paragraphs (a) and (b) of this
Section 8.1 (unless ordered by a court) shall be made by the Corporation only
as authorized in the specific case upon a determination that indemnification
of the director, officer, employee or agent is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in
paragraphs (a) and (b) of this Section 8.1. Such determination shall be made
(i) by the Board of
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Directors by a majority vote of a quorum consisting of directors who were not
parties to such action, suit or proceeding, (ii) if such a quorum is not
obtainable or, even if obtainable, a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion or (iii) by the
stockholders.
(e) Subject to compliance with the other terms and conditions of
this Section 8.1, expenses (including attorneys' fees) incurred by a director
or officer in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount
if it shall ultimately be determined that he or she is not entitled to be
indemnified by the Corporation pursuant to this Section 8.1. Such expenses
(including attorneys' fees) incurred by other employees and agents may be so
paid upon compliance with the terms and conditions set forth in this Section
8.1 or such other terms and conditions as the Board of Directors deems
appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Article VIII shall not be deemed exclusive of any
other rights to which those seeking indemnification or advancement of expenses
may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in an official capacity
and as to action in another capacity while holding such office.
(g) For purposes of this Article VIII, any reference to the
"Corporation" shall include, in addition to the resulting or surviving
corporation, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is
or was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
the provisions of this Article VIII with respect to the resulting or
surviving corporation as he or she would have with respect to such
constituent corporation if its separate existence had continued.
(h) For purposes of this Article VIII, any reference to "other
enterprise" shall include employee benefit plans; any reference to "fines"
shall include any excise taxes assessed on a person with respect to any
employee benefit plan; and any reference 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; and a person who acted in good faith
and in a manner he or she reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner "not opposed to the best interests of the Corporation"
as referred to in this Article VIII.
(i) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Article VIII shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such person.
(j) Notwithstanding any other provisions of this Section 8.1, the
Corporation shall not make any payments pursuant to this Section 8.1 unless the
Corporation shall have first received adequate documentation demonstrating that
such amounts for which payment is requested were actually and reasonably
incurred for the purposes permitted to be reimbursed pursuant to this Section
8.1. Such documentation may include time records, fee and disbursement records
(including hourly rates), description of the work performed, periodic litigation
status reports, the legal basis for the indemnification claim, and other
information reasonably requested by the Corporation. If a written claim has
been made for payment or reimbursement of expenses, the Corporation may require
periodic status reports from the claimant or the counsel handling the defense of
such proceeding as to the status of such proceeding, the matters presented in
the proceeding for which indemnification is sought, the names of any expert
witnesses to be retained, the projected costs for such proceeding and any other
information which is customary to obtain in order to determine whether such
expenses were actually and reasonably incurred for the purposes permitted to be
reimbursed pursuant to this Section 8.1. In the event that the party requesting
indemnification or advancement of expenses has incurred costs in multiple
proceedings, or shared legal counsel with other claimants, or circumstances
exist where some costs are permitted or required to be reimbursed and some are
not, the party submitting the request for payment shall allocate such costs and
explain in sufficient detail a reasonable basis for the allocation of costs. If
the party requesting payment fails to make an allocation when necessary, or to
provide an adequate explanation for any such allocation, the Corporation shall
determine a reasonable basis for allocation based on the written
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information furnished to it. If any information relating to the allocation
of expenses or any other matter is not properly supplied, the Corporation
shall not be required to make payment until such information is fully
supplied. If a claim under this Section 8.1 is not paid in full by the
Corporation within ninety days after a written claim meeting the requirements
of this Section 8.1 has been received by the Corporation, the claimant may at
any time thereafter bring suit against the Corporation to recover the unpaid
amount of the claim, plus any interest required by law to be paid. Such suit
may only be filed in the Circuit Court of Cook County, Illinois, the federal
district court for the Northern District of Illinois, the Superior Court of
Delaware, New Castle County, or the federal district court for Delaware. It
shall be a defense to any such action that the claimant has not met the
requirements of this Section 8.1, including the provisions of this paragraph
(j), or the standards of conduct which make it permissible under the Delaware
General Corporation Law for the Corporation to pay the claimant for the
amount claimed.
(k) Notwithstanding any other provisions of this Section 8.1,
nothing herein shall require the Corporation to make an advance of expenses
at any time. In the event that any written claim for advancement of expenses
is submitted to the Corporation, this Section 8.1 shall apply to such written
claim for advancement of expenses except to the extent expressly required by
the General Corporation Law of the State of Delaware or applicable law. Any
undertaking shall comply with the requirements of paragraph (l) of this
Section 8.1.
(l) If any undertaking is permitted to be delivered by a person
pursuant to this Section 8.1 or the General Corporation Law of the State of
Delaware, the Corporation shall prescribe the form of undertaking. The
Corporation shall be a party to the instrument evidencing the undertaking. In
the event that there is doubt as to the collectibility of any amounts to be
advanced to a claimant which may be required to be repaid, or for other good and
sufficient reason, the Corporation may require adequate security for the
undertaking.
(m) Except to the extent expressly required by the General
Corporation law of the State of Delaware or applicable law or except as
otherwise approved by the Board of Directors, the Corporation does not intend
to provide indemnification or advancement of expenses to any person who (i)
has not acted in good faith or has acted in a manner opposed to the best
interests of the Corporation; (ii) has initiated any action, suit or
proceeding against the Corporation which was not authorized by the Board of
Directors of the Corporation; (iii) has breached any agreement with the
Corporation in any material respect; (iv) has tortiously induced any
director, officer, employee, agent, customer or supplier of the Corporation
or other person or entity to breach his, her or its contractual obligations
to the Corporation; (v) has tortiously interfered with the Corporation's
customers or business relationships; (vi) has committed, threatened or
conspired to commit any acts of dishonesty, embezzlement, misappropriation of
funds, theft of trade secrets, fraud, breach of fiduciary duty or other crime
or tort against the Corporation; or (vii) has engaged in any other unlawful
or tortious conduct against the Corporation or its interests. To the extent
permitted by the General Corporation Law of the State of Delaware and
applicable law, these rules of interpretation shall be applied in construing
all provisions of this Section 8.1.
(n) Notwithstanding anything to the contrary in this Section 8.1,
the Corporation may provide indemnification to a person consistent with the
requirements of Section 145(a) and Section 145(b) of the General Corporation
Law of the State of Delaware and this Section 8.1, and the Corporation shall
provide indemnification to the extent required by Section 145(c) of the
General Corporation Law of the State of Delaware. The provisions of this
Section 8.1 are severable, and if any one or more provisions may be
determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions and any partially enforceable provisions, to the extent
so enforceable, shall nevertheless be binding and enforceable.
SECTION 8.2 INSURANCE. The Corporation may purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against any liability asserted against
him or her and incurred by him or her in any such capacity, or arising out of
his or her status as such, whether or not the Corporation would have the power
to indemnify him or her against such liability under the provisions of Section
145 of the General Corporation Law of the State of Delaware.
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ARTICLE IX
NOTICES
SECTION 9.1 MANNER OF NOTICE. Except as otherwise provided by
law, whenever under the provisions of the laws of the State of Delaware, the
Restated Certificate of Incorporation or these Bylaws notice is required to
be given to any stockholder, director or member of any committee of the Board
of Directors, such notice may be given by personal delivery or by depositing
it, in a sealed envelope, in the United States mails, air mail or first
class, postage prepaid, addressed, or by delivering it to a telegraph
company, charges prepaid, for transmission, or by transmitting it via
telecopier or by electronic mail via the Internet or similar system, to such
stockholder, director or member either at the address of such stockholder,
director or member as it appears on the books of the Corporation or, in the
case of such a director or member, at his or her business address; and such
notice shall be deemed to be given at the time when it is thus personally
delivered, deposited, delivered or transmitted, as the case may be. Such
requirement for notice shall also be deemed satisfied, except in the case of
stockholder meetings with respect to which written notice is required by law,
if actual notice is received orally or by other writing by the person
entitled thereto as far in advance of the event with respect to which notice
is being given as the minimum notice period required by the laws of the State
of Delaware or these Bylaws.
Whenever notice is required to be given under any provision of the
laws of the State of Delaware, the Restated Certificate of Incorporation or
these Bylaws to any stockholder to whom (a) notice of two consecutive annual
meetings of stockholders, and all notices of meetings of stockholders or of
the taking of action by stockholders by written consent without a meeting to
such stockholder during the period between such two consecutive annual
meetings, or (b) all, and at least two, payments (if sent by first class
mail) of dividends or interest on securities of the Corporation during a
12-month period, have been mailed addressed to such stockholder at the
address of such stockholder as shown on the records of the Corporation and
have been returned undeliverable, the giving of such notice to such
stockholder shall not be required. Any action or meeting which shall be
taken or held without notice to such stockholder shall have the same force
and effect as if such notice had been duly given. If any such stockholder
shall deliver to the Corporation a written notice setting forth the then
current address of such stockholder, the requirement that notice be given to
such stockholder shall be reinstated.
SECTION 9.2 WAIVER OF NOTICE. Whenever any notice is required
to be given under any provision of the laws of the State of Delaware, the
Restated Certificate of Incorporation or these Bylaws, a written waiver
thereof, signed by the person or persons entitled to such notice, whether
before or after the time stated therein, shall be deemed equivalent to such
notice. Attendance by a person at a meeting shall constitute a waiver of
notice of such meeting, except when such person attends such meeting for the
express purpose of objecting, at the beginning of such meeting, to the
transaction of any business because such meeting has not been lawfully called
or convened. Neither the business to be transacted at, nor the purpose of,
any regular or special meeting of stockholders, the Board of Directors or a
committee of the Board of Directors need be specified in any written waiver
of notice unless so required by the laws of the State of Delaware, the
Restated Certificate of Incorporation or these Bylaws.
ARTICLE X
DIVIDENDS
The Board of Directors may from time to time declare, and the
Corporation may pay, dividends, in cash, in property or in shares of capital
stock of the Corporation, on its outstanding shares of capital stock in the
manner and upon the terms and conditions provided by law and by the Restated
Certificate of Incorporation.
ARTICLE XI
AMENDMENTS
Except to the extent otherwise provided in the Restated Certificate of
Incorporation or these Bylaws, these Bylaws shall be subject to alteration,
amendment or repeal, and new Bylaws may be adopted (a) by the affirmative vote
of the holders of not less than a majority of the voting power of all
outstanding shares of capital stock of the Corporation entitled
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to vote for matters other than the election of directors or (b) by the
affirmative vote of not less than a majority of the entire Board of Directors
at any meeting of the Board of Directors at which there is a quorum present
and voting; PROVIDED, HOWEVER, that the right to call a special meeting by
holders of at least fifty percent of the voting power of the capital stock of
the Corporation issued and outstanding and entitled to vote at a special
meeting, as provided in Section 1.2 of these Bylaws, shall not be altered,
amended or repealed with respect to any group of shareholders entitled to
call a special meeting, without the approval by the affirmative vote of the
holders of not less than a majority of the voting power of the shares of
capital stock which are held by such shareholders and which are entitled to
vote in such group at such special meeting.
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