<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 23, 1998
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
NORTHWEST AIRLINES CORPORATION
(FORMERLY NEWBRIDGE PARENT CORPORATION)
(Exact name of registrant as specified in its charter)
------------------------------
<TABLE>
<S> <C>
DELAWARE 41-1905580
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
2700 LONE OAK PARKWAY
EAGAN, MINNESOTA 55121
(612) 726-2111
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
------------------------------
DOUGLAS M. STEENLAND, ESQ.
EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
NORTHWEST AIRLINES CORPORATION
2700 LONE OAK PARKWAY
EAGAN, MINNESOTA 55121
(612) 726-2111
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
------------------------------
COPIES TO:
ROBERT L. FRIEDMAN, ESQ.
SIMPSON THACHER & BARTLETT
425 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017-3954
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement number of the earlier effective registration
statement for the same offering. / / ______
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / ______
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SHARES AMOUNT TO AGGREGATE PRICE AGGREGATE REGISTRATION
TO BE REGISTERED BE REGISTERED PER UNIT (1) OFFERING PRICE(1) FEE
<S> <C> <C> <C> <C>
Common Stock, par value $.01 (2).................. 2,631,784 shares $22.38 $58,899,325.92 $16,374.01
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933, as amended.
(2) Includes Preferred Share Purchase Rights which prior to the occurrence of
certain events will not be exercisable or evidenced separately from the
Common Stock.
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION, DATED DECEMBER 23, 1998
PROSPECTUS
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING STOCKHOLDERS MAY NOT SELL THESE SECURITIES UNTIL A REGISTRATION
STATEMENT COVERING THESE SECURITIES IS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION AND DECLARED EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE
SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY
STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
NORTHWEST AIRLINES CORPORATION
2,631,784 SHARES OF COMMON STOCK
(PAR VALUE $.01 PER SHARE)
------------------------
This Prospectus relates to the 2,631,784 shares of Common Stock of Northwest
Airlines Corporation (formerly Newbridge Parent Corporation) to be sold from
time to time by and for the account of the Selling Stockholders named in
this Prospectus.
Northwest Airlines Corporation will not receive any of the proceeds from the
sale of the Common Stock offered by the Selling Stockholders.
In addition to acquiring Common Stock, each purchaser of Common Stock will
acquire one Right to purchase one one-hundredth of a share of Series D
Junior Participating Preferred Stock for each share of Common Stock
purchased. This Right is exercisable in certain circumstances which may
arise in connection with a hostile takeover attempt, but prior to the
occurrence of such event, this Right will not be exercisable or evidenced
separately from the Common Stock.
The Common Stock of Northwest Airlines Corporation is quoted on the Nasdaq
National Market under the symbol "NWAC". On December 18, 1998, the closing
price of the Common Stock was $23.25 per share.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED THAT THIS
PROSPECTUS IS ACCURATE AND COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is December 23, 1998.
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<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
About this Prospectus.................................................................. 2
Where You Can Find More Information.................................................... 2
The Company............................................................................ 3
Use of Proceeds........................................................................ 4
Selling Stockholders................................................................... 4
Description of NWA Corp. Capital Stock................................................. 4
Plan of Distribution................................................................... 9
Legal Matters.......................................................................... 11
Experts................................................................................ 11
</TABLE>
ABOUT THIS PROSPECTUS
This prospectus ("Prospectus") is part of a registration statement (the
"Registration Statement") that we filed with the Securities and Exchange
Commission (the "Commission") utilizing a "shelf" registration process. Under
this shelf registration process, the selling stockholders named herein (the
"Selling Stockholders") may sell up to an aggregate of 2,631,784 shares of the
Common Stock, par value $0.01 per share (the "Common Stock"), of Northwest
Airlines Corporation ("NWA Corp.") described in this Prospectus in one or more
offerings. This Prospectus provides you with a general description of NWA Corp.
and the Common Stock to be offered by the Selling Stockholders. From time to
time, we may provide a prospectus supplement that will contain specific
information about the terms of certain offerings by the Selling Stockholders. A
prospectus supplement may also add, update or change information contained in
this Prospectus. You should read both this Prospectus and any prospectus
supplement together with additional information described under the next heading
"Where You Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Commission. You can inspect and copy any document filed by
us or our predecessor corporation, Northwest Airlines Holdings Corporation,
which was formerly known as Northwest Airlines Corporation ("Old NWA Corp.") at
the public reference facilities maintained by the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549. Please call the Commission at
1-800-SEC-0330 for further information on the operation of such public reference
room. Our Commission filings are also available on the Commission's Website at
"http://www.sec.gov."
The Commission allows us to "incorporate by reference" information from
other documents that we file with them, which means that we can disclose
important information by referring to those documents. The information
incorporated by reference is an important part of this Prospectus, and
information that we file later with the Commission will automatically update and
supersede this information. We incorporate by reference the following documents
filed by Old NWA Corp. and NWA Corp. pursuant to the Securities Exchange Act of
1934, as amended (the "Exchange Act"):
- Annual Report of Old NWA Corp. on Form 10-K for the fiscal year ended
December 31, 1997, as amended;
- Quarterly Reports of Old NWA Corp. on Form 10-Q for the fiscal quarters
ended March 31, 1998, June 30, 1998, and September 30, 1998;
- Current Reports of Old NWA Corp. on Form 8-K dated as January 25, 1998,
February 19, 1998, March 2, 1998, April 3, 1998, June 25, 1998 and August
28, 1998 and Current Report of NWA Corp. on Form 8-K dated as of November
20, 1998; and
- all documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this Prospectus and prior to the
termination of the offering made by this Prospectus.
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You may request a copy of these filings at no cost, by writing or
telephoning us at the following address:
Northwest Airlines Corporation
Attn: Secretary
Department A1180
5101 Northwest Drive
St. Paul, Minnesota 55111
(612) 726-2111
You should rely only on the information contained in this document or that
we have referred to you. We have not authorized anyone else to provide you with
different information.
3
<PAGE>
THE COMPANY
We operate the world's fourth largest airline (as measured by 1997 revenue
passenger miles ("RPMs")) through our principal indirect wholly-owned
subsidiary, Northwest Airlines, Inc. ("Northwest"). Northwest is engaged
principally in commercial transportation of passengers and cargo. Its business
focuses on developing a global airline network through the optimization of its
domestic hubs at Detroit, Minneapolis/St. Paul and Memphis, an extensive Pacific
route system with hubs at Tokyo and Osaka, a trans-Atlantic alliance with KLM
Royal Dutch Airlines ("KLM"), which operates through a hub in Amsterdam and a
global alliance with Continental Airlines, Inc. ("Continental"), which will
result in a domestic presence as large as any other U.S. airline, access to
Latin America and an increased Pacific presence.
Northwest operates substantial domestic and international route networks and
directly serves 143 cities in 19 countries on the continents of North America,
Asia and Europe. Northwest had more than 54 million enplanements and flew over
72 billion RPMs in 1997.
Our company was incorporated in Delaware in 1998. Our principal executive
offices are located at 2700 Lone Oak Parkway, Eagan, Minnesota 55121, and our
telephone number is (612) 726-2111.
HOLDING COMPANY REORGANIZATION
NWA Corp. succeeded Old NWA Corp. in a reorganization effected on November
20, 1998 (the "Closing Date"), as a result of which NWA Corp. became a public
holding company. On the Closing Date, pursuant to Section 251(g) of the Delaware
General Corporation Law and the Amended and Restated Agreement and Plan of
Merger, dated as of October 30, 1998, among NWA Corp., Old NWA Corp. and
Newbridge Merger Corporation, a Delaware corporation and at such date a
wholly-owned subsidiary of NWA Corp. ("Merger Sub"), Merger Sub merged (the
"Merger") with and into Old NWA Corp., which was the surviving corporation in
the Merger, and ceased to exist. Pursuant to the Merger,
(i) each share of Common Stock, par value $.01 per share, of Merger Sub
issued and outstanding prior to the effective time of the Merger (the
"Effective Time"), including each share that was owned by NWA Corp., was
converted into one share of Common Stock, par value $.01 per share, of
Old NWA Corp.;
(ii) each share of Common Stock, par value $.01 per share, of Old NWA Corp.
issued and outstanding or held in its treasury immediately prior to the
Effective Time was converted into one share of Common Stock, par value
$.01 per share, of NWA Corp.; and
(iii) each share of Series C Preferred Stock, par value $.01 per share of Old
NWA Corp. issued and outstanding or held in its treasury immediately
prior to the Effective Time was converted into one share of Series C
Preferred Stock, par value $.01 per share, of NWA Corp.
As a result of the Merger, Old NWA Corp. became a direct wholly-owned
subsidiary of NWA Corp., and NWA Corp. became the publicly traded holding
company for Old NWA Corp. and the holding and operating subsidiaries of Old NWA
Corp.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the Common Stock
offered by the Selling Stockholders.
SELLING STOCKHOLDERS
The Common Stock to which this Prospectus relates is being offered by the
Selling Stockholders. NWA Corp., Old NWA Corp., Air Partners, L.P., a Texas
limited partnership (the "Partnership"), the
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partners of the Partnership signatory thereto (the "Partners"), 1998 CAI
Partners, L.P., a Texas limited partnership, Bonderman Family Limited
Partnership, a Texas limited partnership ("Transferor I"), 1992 Air, Inc., a
Texas corporation ("Transferor II"), and Air Saipan, Inc., a corporation
organized under the laws of the Commonwealth of the Northern Marianas Islands
("Transferor III", and, collectively with "Transferor I" and "Transferor II",
the "Transferors") are parties to an Investment Agreement dated as of January
25, 1998, as amended by Amendment No. 1 dated as of February 27, 1998 and
Amendment No. 2 dated as of November 20, 1998 (as amended, the "Investment
Agreement"). Pursuant to the Investment Agreement, on the Closing Date, NWA
Corp. and Old NWA Corp. acquired from the Partners the interests in the
Partnership held by them and from the Transferors the shares of Class A Common
Stock, par value $.01 per share of Continental ("Continental Class A Common
Stock") owned by them, in exchange for shares of Common Stock and cash (the
"Exchange"). An aggregate of 2,631,784 shares of Common Stock were issued to the
Selling Stockholders in the Exchange (the "Offered Shares"), and all such shares
are being offered hereby. For a description of certain restrictions on sales by
the Selling Stockholders, see "Plan of Distribution--Certain Restrictions on
Sales by the Selling Stockholders".
The following table states the number of shares of the outstanding Common
Stock owned by each Selling Stockholder as of the Closing Date, the number of
such shares which may be sold for the account of each Selling Stockholder, and
the number of such shares that will be owned by each Selling Stockholder
assuming the sale of all the Offered Shares.
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF SHARES NUMBER OF SHARES
OF COMMON STOCK OF COMMON STOCK OF COMMON STOCK
SELLING STOCKHOLDER OWNED TO BE SOLD OWNED AFTER SALE
- --------------------------------------------------------- ----------------- ----------------- -----------------
<S> <C> <C> <C>
David Bonderman.......................................... 308,736 308,736 0
Bonderman Family Limited Partnership..................... 104,363 104,363 0
Lectair Partners......................................... 483,333 483,333 0
Eli Broad................................................ 179,011 179,011 0
Donald Sturm............................................. 447,533 447,533 0
1992 Air GP.............................................. 1,108,808 1,108,808 0
</TABLE>
DESCRIPTION OF NWA CORP. CAPITAL STOCK
The summary of the terms of the capital stock of NWA Corp. set forth below
is not intended to be complete and is qualified by reference to the restated
certificate of incorporation, as amended, of NWA Corp. (the "NWA Corp. Charter")
and the restated bylaws of NWA Corp. (the "NWA Corp. Bylaws"), copies of which
have been filed as exhibits to the Registration Statement. References to "Common
Stock" and "Series C Preferred Stock" (as defined below) for time periods prior
to November 20, 1998, refer to the Common Stock and Series C Preferred Stock of
Old NWA Corp. See "The Company-- Holding Company Reorganization."
AUTHORIZED CAPITAL STOCK
Under the NWA Corp. Charter, NWA Corp.'s authorized capital stock consists
of 315,000,000 shares of Common Stock, and 45,020,000 shares of preferred stock,
par value $0.01 per share (the "Preferred Stock"). Of such authorized shares of
Preferred Stock, 25,000,000 shares have been designated Series C Preferred
Stock, par value $0.01 per share (the "Series C Preferred Stock"), 3,000,000
shares have been designated Series D Junior Participating Preferred Stock, par
value $0.01 per share (the "Series D Junior Participating Preferred Stock"), and
17,020,000 shares are undesignated.
5
<PAGE>
There are currently no shares of Series D Junior Participating Preferred
Stock outstanding. The Series D Junior Participating Preferred Stock is issuable
upon exercise of Preferred Share Purchase Rights (the "Rights"). Each share of
Common Stock has one Right attached thereto.
The Preferred Stock has preference over the Common Stock with respect to the
payment of dividends and the distribution of assets in the event of a
liquidation or dissolution of NWA Corp. In addition, the Board of Directors of
NWA Corp. has the authority to issue additional shares of Preferred Stock in one
or more series and to fix the voting and other powers, designations, dividends,
preferences and relative, participating, optional, conversion, exchange,
redemption and other special rights and qualifications, limitations or
restrictions thereon of any such series of Preferred Stock.
NWA CORP. COMMON STOCK
As of October 31, 1998, 81,288,206 shares of Common Stock were issued and
outstanding.
Each share of Common Stock is entitled to one vote at all meetings of
stockholders of NWA Corp. for the election of directors (other than directors
elected by holders of the Series C Preferred Stock) and all matters submitted to
stockholder vote.
Holders of the Common Stock participate equally as to any dividends or other
distributions, including dividends payable in shares of Common Stock (or
securities having rights to acquire Common Stock). Upon any liquidation,
dissolution or winding up of NWA Corp., holders of the Common Stock are entitled
to share equally and ratably in the assets of NWA Corp., if any, remaining after
the payment of all debts and liabilities of NWA Corp. and the liquidation
preference of any outstanding Preferred Stock. Holders of Common Stock have no
preemptive, subscription or redemption rights and are not subject to further
calls or assessments. Holders of Common Stock have no right to cumulate their
votes in the election of directors. The outstanding shares of Common Stock are
duly authorized, validly issued, fully paid and nonassessable. The Common Stock
is quoted on the Nasdaq National Market.
NWA CORP. PREFERRED STOCK
Series C Preferred Stock
As of October 31, 1998, 5,650,633 shares of Series C Preferred Stock were
issued and outstanding.
CONVERSION RIGHTS
Each share of Series C Preferred Stock is convertible at any time at the
option of the holder thereof into 1.364 shares of Common Stock.
Each share of Series C Preferred Stock automatically converts into 1.364
shares of the Common Stock upon the sale, transfer, exchange or other
disposition of record or beneficial ownership of such share to (or with) any
person who is not an employee trust or other "Qualified Holder" (a
"Non-Qualified Sale").
PUT RIGHT
During the 60-day period ending ten years after August 1, 1993 (the "Put
Date"), the employee trusts and other "Qualified Holders" of the Series C
Preferred Stock (generally consisting of current and former NWA Corp. employees
and their spouses, children and heirs) will have the right to put such stock to
NWA Corp. Prior to the commencement of such 60-day period, NWA Corp. will have
the right to elect either of the following:
(i) to repurchase such Series C Preferred Stock with cash equal to the Put
Price (defined below) or with shares of Common Stock having an aggregate
trading value (based on the average
6
<PAGE>
closing prices for Common Stock during the 30-day period ending on the
Put Date) equal to the Put Price; or
(ii) to permit the relevant trust or Qualified Holder either (A) to receive
the number of shares of Common Stock into which such Series C Preferred
Stock would otherwise then be convertible plus the "Excess Amount" (as
defined below) in cash, or (B) to have such number of shares of Common
Stock otherwise issuable upon conversion sold by NWA Corp., whereupon
the relevant trust or Qualified Holder would receive in cash the
proceeds realized upon such sale plus the Excess Amount.
Notwithstanding the foregoing, any election by NWA Corp. to provide those
exercising put rights with shares of Common Stock in lieu of cash (as described
in clause (i) of the preceding paragraph) would require the approval of a
majority of the Series C Directors (such directors being described under "Voting
Rights" below). Any decision by NWA Corp. not to repurchase any shares of Series
C Preferred Stock as described above requires the consent of a majority of the
Series C Directors.
The "Put Price" in 2003 of the Series C Preferred Stock will be equal to a
pro rata portion of the actual savings resulting from labor cost savings
agreements entered into in 1993 ($266.3 million as of September 30, 1998). The
actual labor cost savings is calculated as the excess of the amount NWA Corp.
would have paid its employees in basic hourly wages during the period covered by
the labor cost savings absent the labor cost savings over the amount actually
paid, together with certain savings in respect of reduced vacation accruals and
certain work rule changes.
The "Excess Amount" for each share of Series C Preferred Stock as to which
the put right is exercised (which Excess Amount may be payable when NWA Corp.
has elected the mechanism described in clause (ii) of the third preceding
paragraph) is equal to the excess of (i) the Put Price over (ii) the specified
market price per share of the Common Stock received pursuant to such clause
(ii), multiplied by the number of shares of Common Stock into which one share of
Series C Preferred Stock may then be converted.
In the event NWA Corp. fails to fulfill its mandatory redemption obligations
as described above, on a quarterly basis thereafter NWA Corp. must use all cash
held by NWA Corp. (or available under revolving credit agreements) in excess of
all the requirements within one year of such determination date ("Available
Cash") to make partial pro rata redemptions, provided such redemptions are not
prohibited under applicable credit agreements. Cash held by NWA Corp.'s
subsidiaries will be included in the calculation of Available Cash only to the
extent such cash is made available to NWA Corp. pursuant to applicable law or
any loan agreements or instruments to which NWA Corp. or any of its subsidiaries
is a party or is subject.
DIVIDENDS
The "Dividend Date" for the Series C Preferred Stock is August 1 of each
year. If the Common Stock is listed on the New York or American Stock Exchange
or quoted on the Nasdaq National Market on the business day preceding a Dividend
Date, no dividend will accrue on the Series C Preferred Stock in respect of the
year then ended. If the Common Stock is not so listed or quoted on such business
day, on the following Dividend Date each share of Series C Preferred Stock will
accrue a cumulative dividend for the year then ended equal to 5% of (i) the
actual labor cost savings realized by NWA Corp. from August 1, 1993 to such
Dividend Date plus the aggregate amount of previously accrued dividends on such
Series C Preferred Stock, divided by (ii) the total number of shares of Series C
Preferred Stock issued by NWA Corp. Because the Common Stock is approved for
quotation on the Nasdaq National Market, no dividends have accrued on the Series
C Preferred Stock.
In the event NWA Corp. fails to fulfill its mandatory redemption obligations
described above, as of the Put Date the Series C Preferred Stock will begin to
accrue a cumulative dividend payable quarterly
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<PAGE>
at a rate equal to the greater of 12% per annum or the highest default dividend
rate then payable on any series of Preferred Stock of NWA Corp.
VOTING RIGHTS
The Series C Preferred Stock votes with the Common Stock on all matters
submitted to stockholders for a vote, except with respect to the election of
directors. When voting with the Common Stock, each share of Series C Preferred
Stock has a number of votes equal to 1.364.
With respect to the election of directors, the Series C Preferred Stock
voting as a separate class is entitled to elect a slate of three Series C
Directors, one of whom is to be nominated by the International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers of America ("IBT"), one by the
International Association of Machinists and Aerospace Workers ("IAM") and one by
the Northwest Master Executive Council (the "Northwest MEC") of the Air Line
Pilots Association, International ("ALPA"). Until July 31, 2003, the number of
Series C Directors will be the greater of three or the number that represents at
least 15% of NWA Corp.'s directors.
In the event NWA Corp. fails to fulfill its mandatory redemption obligation
described above, the number of Series C Directors will be increased to the
greater of (i) three more than the number of Series C Directors then serving on
NWA Corp.'s Board, and (ii) the number of directors that would cause the
proportion of Series C Directors to the total number of directors to be equal to
the proportion of the total voting power of all shares of Series C Preferred
Stock then outstanding to the total voting power of all shares of all voting
capital stock of NWA Corp. then outstanding.
If the holders of Series C Preferred Stock are entitled to elect more than
three directors, the Northwest MEC, the IBT and the IAM will each be entitled to
nominate one-third of the Series C Directors, and if the total number of Series
C Directors is not a multiple of three, any remaining Series C Directors will be
nominated by a unanimous vote of the existing Series C Directors designated by
these three unions.
Holders of Series C Preferred Stock are not entitled to vote such stock for
the election of any directors other than the Series C Directors. The entitlement
of the holders of Series C Preferred Stock to elect the Series C Directors will
expire on the first date on which no shares of Series C Preferred Stock are
outstanding, whether as a result of conversions, exchanges, repurchases or
redemptions.
OPTIONAL REDEMPTION
NWA Corp. may redeem the Series C Preferred Stock in whole or in part at the
Put Price at any time on 60 days' prior notice. Notwithstanding NWA Corp.'s
right to redeem the Series C Preferred Stock in whole, until August 1, 2003,
each trust may retain one share of Series C Preferred Stock for purposes of
exercising the right to elect Series C Directors, as described above.
LIQUIDATION PREFERENCE
The Series C Preferred Stock has a liquidation preference per share equal to
the Put Price. The issuance by NWA Corp. of a new series of Preferred Stock that
ranks, as to both preference in liquidation and bankruptcy and the receipt of
dividends and repayment, senior to or PARI PASSU with the Series C Preferred
Stock, does not require the consent of the holders of the Series C Preferred
Stock.
Series D Junior Participating Preferred Stock
On November 20, 1998, the Board of Directors of NWA Corp. authorized and
declared a dividend of one right ("Right") for each outstanding share of Common
Stock. The dividend is payable to the stockholders of record as of the Effective
Time of the Merger (the "Record Date"). Each Right entitles the registered
holder to purchase from NWA Corp. one one-hundredth of a share of Series D
Junior
8
<PAGE>
Participating Preferred Stock at a price of $150 per one one-hundredth of a
share of Series D Junior Participating Preferred Stock (as the same may be
adjusted, the "Purchase Price"). The description and terms of the Rights are set
forth in a Rights Agreement dated as of November 20, 1998, as the same may be
amended from time to time (the "Rights Agreement"), between NWA Corp. and
Norwest Bank Minnesota, N.A., as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") have acquired Beneficial Ownership (as such term is defined in the
Rights Agreement) of a number of shares of Common Stock equal to 19% or more
(25% or more in the case of certain Institutional Investors (as such term is
defined in the Rights Agreement)) of the number of the shares of Common Stock
then issued and outstanding; provided, however, that if a person or group would
be deemed an Acquiring Person upon the adoption of the Rights Agreement, such
person or group will not be deemed an "Acquiring Person" for any purposes of the
Rights Agreement unless and until such person or group acquires Beneficial
Ownership of any additional shares of Common Stock after the date of the
adoption of the Rights Agreement unless upon the consummation of the acquisition
of such additional shares of Common Stock such person or group does not
beneficially own a number of shares of Common Stock equal to 19% or more (25% or
more in the case of certain Institutional Investors) of the number of the shares
of Common Stock then issued and outstanding or (ii) 10 business days (or such
later date as may be determined by action of the Board of Directors of NWA Corp.
prior to such time as any person or group of affiliated persons becomes an
Acquiring Person) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group of a number of shares of Common
Stock equal to 19% or more of the number of shares of Common Stock then issued
and outstanding (the earlier of such dates being called the "Distribution
Date"), the Rights will be evidenced, with respect to any of the certificates
for shares of Common Stock outstanding as of the Record Date, by such
certificate together with a copy of the Summary of Rights sent to the holders of
the shares of Common Stock as of the Record Date. The phrase "then outstanding",
when used with reference to a person or group's Beneficial Ownership of shares
of Common Stock, means the number of shares of Common Stock then issued and
outstanding together with the sum of (i) all the shares of Common Stock issuable
upon conversion of all the shares of Series C Preferred Stock issued and
outstanding as of the date of the Rights Agreement, (ii) all the shares of
Common Stock issuable upon the exercise of all employee stock options then
issued and outstanding as of November 16, 1995 and (iii) any other shares of
Common Stock not then actually issued and outstanding but which such person or
group would be deemed to beneficially own thereunder (together, the "outstanding
Common Stock")
The Rights Agreement provides that, until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights will be transferred with and
only with the shares of Common Stock. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Stock certificates issued
after the Record Date upon transfer or new issuances of Common Stock (including
pursuant to the conversion of Series C Preferred Stock) will contain a notation
incorporating the Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender for transfer of
any certificates for Common Stock outstanding as of the Record Date, even
without such notation or a copy of the Summary of Rights, will also constitute
the transfer of the Rights associated with the Common Stock represented by such
certificate. As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common Stock as of the close of business on the
Distribution Date and such separate Right Certificates alone will evidence the
Rights.
The Rights are not exercisable until the Distribution Date. The Rights will
expire on November 16, 2005 (the "Final Expiration Date"), unless the Final
Expiration Date is extended or unless the Rights are earlier redeemed or
exchanged by NWA Corp., in each case as described below.
9
<PAGE>
The Purchase Price payable, and the number of shares of Series D Junior
Participating Preferred Stock or other securities or property issuable, upon
exercise of the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a subdivision, combination
or reclassification of, the Series D Junior Participating Preferred Stock, (ii)
upon the grant to holders of the Series D Junior Participating Preferred Stock
of certain rights or warrants to subscribe for or purchase Series D Junior
Participating Preferred Stock at a price, or securities convertible into Series
D Junior Participating Preferred Stock with a conversion price, less than the
then-current market price of the Series D Junior Participating Preferred Stock
or (iii) upon the distribution to holders of the Series D Junior Participating
Preferred Stock of evidences of indebtedness or assets (excluding regular
periodic cash dividends or dividends payable in Series D Junior Participating
Preferred Stock) or of subscription rights or warrants (other than those
referred to above).
The number of outstanding Rights are also subject to adjustment in the event
of a stock split of the Common Stock or a stock dividend on the Common Stock
payable in Common Stock or subdivisions, consolidations or combinations of the
Common Stock occurring, in any such case, prior to the Distribution Date.
Shares of Series D Junior Participating Preferred Stock purchasable upon
exercise of the Rights will not be redeemable. Each share of Series D Junior
Participating Preferred Stock will be entitled, when, as and if declared, to a
minimum preferential quarterly dividend payment of $1 per share but will be
entitled to an aggregate dividend of 100 times the dividend declared per share
of Common Stock. In the event of liquidation, the holders of the Series D Junior
Participating Preferred Stock will be entitled to a minimum preferential
liquidation payment of $100 per share (plus any accrued but unpaid dividends)
but will be entitled to an aggregate payment of 100 times the payment made per
share of Common Stock. Each share of Series D Junior Participating Preferred
Stock will have 100 votes, voting together with the Common Stock. Finally, in
the event of any merger, consolidation or other transaction in which shares of
Common Stock are converted or exchanged, each share of Series D Junior
Participating Preferred Stock will be entitled to receive 100 times the amount
received per share of Common Stock. These rights are protected by customary
antidilution provisions.
In the event that any person or group of affiliated or associated persons
becomes an Acquiring Person, each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereupon become void),
will thereafter have the right to receive upon exercise of a Right at the then
current exercise price of the Right, that number of shares of Common Stock (or
one one-hundredths of a share of Series D Junior Participating Preferred Stock)
having a market value of two times the exercise price of the Right.
In the event that, after a person or group has become an Acquiring Person,
NWA Corp. is acquired in a merger or other business combination transaction or
50% or more of its consolidated assets or earning power are sold, proper
provision will be made so that each holder of a Right (other than Rights
beneficially owned by an Acquiring Person which will have become void) will
thereafter have the right to receive, upon the exercise thereof at the then
current exercise price of the Right, that number of shares of common stock of
the person with whom NWA Corp. has engaged in the foregoing transaction (or its
publicly traded parent), which number of shares at the time of such transaction
will have a market value of two times the exercise price of the Right.
At any time after any person or group becomes an Acquiring Person and prior
to the acquisition by such person or group of beneficial ownership of a number
of shares of Common Stock equal to 50% or more of the number of shares of
outstanding Common Stock, the Board of Directors of NWA Corp. may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or one one-hundredth of a share of Series D Junior Participating Preferred Stock
(or of a share of a class or series of NWA
10
<PAGE>
Corp.'s preferred stock having equivalent rights, preferences and privileges),
per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional shares of Series D Junior Participating
Preferred Stock will be issued (other than fractions which are integral
multiples of one one-hundredth of a share of Series D Junior Participating
Preferred Stock, which may, at the election of NWA Corp., be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Series D Junior Participating Preferred Stock
on the last trading day prior to the date of exercise.
At any time prior to the time an Acquiring Person becomes such, the Board of
Directors of NWA Corp. may redeem the Rights in whole, but not in part, at a
price of $.01 per Right (the "Redemption Price"). Immediately upon any
redemption of the Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
For so long as the Rights are then redeemable, NWA Corp. may, except with
respect to the Redemption Price, amend the Rights in any manner. After the
Rights are no longer redeemable NWA Corp. may, except with respect to the
Redemption Price, amend the Rights in any manner that does not adversely affect
the interests of holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no rights
as a stockholder of NWA Corp., including, without limitation, the right to vote
or to receive dividends.
A copy of the Rights Agreement is available free of charge from NWA Corp.
This summary description of the Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement, as the same may
be amended from time to time, which is hereby incorporated herein by reference.
TRANSFER AGENT AND REGISTRAR
Norwest Bank Minnesota, National Association is the transfer agent and
registrar for the Common Stock.
PLAN OF DISTRIBUTION
The Selling Stockholders have advised us that they may distribute the
Offered Shares from time to time in one or more transactions (which may involve
block transactions):
(i) on the Nasdaq National Market or such other quotation system or national
security exchanges on which NWA Corp.'s Common Stock is quoted or
listed, in transactions that may include special offerings and exchange
distributions pursuant to and in accordance with the rules of such
exchanges,
(ii) in the over-the-counter market, or
(iii) in transactions otherwise than on such exchanges or in the
over-the-counter market, or in a combination of any such transactions.
The Selling Stockholders may effect such transactions at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices, at negotiated prices or at fixed prices. The Selling Stockholders may
effect such transactions by selling the Offered Shares to or through broker-
dealers and such broker-dealers will receive compensation in the form of
discounts or commissions from the Selling Stockholders and may receive
commissions from the purchasers of the Offered Shares for whom they may act as
agent (which discounts or commissions from the Selling Stockholders or such
purchasers will not exceed those customary in the type of transactions
involved).
11
<PAGE>
Any broker-dealers that participate with the Selling Stockholders in the
distribution of the Offered Shares may be deemed to be "underwriters" within the
meaning of the Securities Act of 1933, as amended (the "Securities Act"), and
any commissions or discounts received by such broker-dealers and any profit on
the resale of the Offered Shares by such broker-dealers might be deemed to be
underwriting discounts and commissions under such act.
Upon our being notified by any Selling Stockholder that any material
arrangement has been entered into with a broker or dealer for the sale of any of
the Offered Shares through a secondary distribution, or a purchase by a broker
or dealer, a supplemented prospectus will be filed, if required, pursuant to
Rule 424(b) under the Securities Act, disclosing the following:
(a) the names of such broker-dealers;
(b) the number of shares involved;
(c) the price at which such shares are being sold;
(d) the commission paid or the discounts or concessions allowed to such
broker-dealers;
(e) where applicable, that such broker-dealers did not conduct any
investigation to verify the information set out or incorporated by
reference in this Prospectus, as supplemented; and
(f) other facts material to the transaction.
CERTAIN RESTRICTIONS ON SALES BY THE SELLING STOCKHOLDERS
Under the Investment Agreement, the Selling Stockholders have agreed, among
other things, that until the earlier of (i) the date that is two years after the
Closing Date and (ii) such time as NWA Corp. has failed to ensure that a
designee of 1992 Air, Inc. is elected to the Board of Directors of NWA Corp.
when the right of 1992 Air, Inc. to designate a director to the Board of
Directors of NWA Corp. (A) remains in effect, (B) has been terminated by virtue
of a written instrument executed by 1992 Air, Inc. or its assignee and NWA Corp.
in connection with an order, ruling, decision, judgment, consent decree or other
decree of a court or Governmental Authority (a "Government Order"), or (C) would
violate a Government Order, each of the Selling Stockholders will not, directly
or indirectly, offer, sell, transfer, tender, pledge or encumber, assign or
otherwise dispose of any Offered Shares other than in connection with bona fide
pledges of such Offered Shares to secure bona fide borrowings or in connection
with bona fide hedging transactions executed by registered broker-dealers;
provided, however, that the Selling Stockholders will be permitted to offer,
sell, transfer, tender, pledge or encumber, assign or otherwise dispose of,
during such two-year period, the following:
(i) in the aggregate, such percentage of the aggregate number of Offered
Shares issued to the Selling Stockholders at the Closing as is equal to
the percentage of the aggregate shares of Common Stock beneficially
owned by Alfred Checchi, Gary Wilson and Richard Blum (collectively, the
"Principals") on the Closing Date that are sold, transferred, assigned
or otherwise actually disposed of by the Principals in the aggregate
during such two-year period;
(ii) in the event that the Selling Stockholders acquire Continental Class A
Common Stock from NWA Corp. pursuant to a right of first offer granted
in the Investment Agreement ("Reoffered Securities"), in the aggregate,
such percentage of the aggregate number of Offered Shares as is
represented by the percentage such Reoffered Securities bears to the
total number of shares of Continental Class A Common Stock the
beneficial ownership of which is acquired by NWA Corp. and Old NWA
Corp. at the Closing; and
(iii) Offered Shares to one or more of its affiliates that is directly or
indirectly controlled by it.
In addition, under the Standstill Agreement dated as of November 20, 1998
(the "Standstill Agreement"), between NWA Corp. and the persons identified on
the signature pages thereof, the
12
<PAGE>
Selling Stockholders have agreed, among other things, that they will not, and
will cause their affiliates not to, directly or indirectly, sell, transfer any
beneficial interest in, pledge, hypothecate or otherwise dispose of any voting
securities of NWA Corp. in any transaction that to the knowledge of such Selling
Stockholder would result in a transfer, pledge, hypothecation or other
disposition to any person or group that would have, upon consummation of such
sale, transfer, pledge, hypothecation or other disposition, directly or
indirectly, beneficial ownership of or the right to acquire beneficial ownership
of such number of NWA Corp. voting securities as represent more than 5% of the
total number of votes which could be cast in an election of members of the NWA
Corp. Board of Directors ("NWA Corp. Combined Voting Power"); PROVIDED, that
each Selling Stockholder will be permitted to sell, transfer or otherwise
dispose of NWA Corp. voting securities:
(a) to one or more of its affiliates that is directly or indirectly
controlled by it;
(b) to any one or more of the Principals;
(c) to certain institutional investors;
(d) pursuant to a tender or exchange offer for NWA Corp. voting securities
which is not opposed by the NWA Corp. Board of Directors;
(e) in a merger transaction; or
(f) by testamentary devise;
PROVIDED, that in the case of clauses (a) and (f) the transferee agrees in
writing to be bound by the terms of the Standstill Agreement; PROVIDED, FURTHER,
that no sales, transfers or other dispositions to any person or group pursuant
to clause (c) may occur if to the knowledge of such Selling Stockholder such
person or group would have, upon consummation of such sale, transfer or other
disposition, directly or indirectly, beneficial ownership of or the right to
acquire beneficial ownership of such number of NWA Corp. voting securities as
represent more than 14.9% of the NWA Corp. Combined Voting Power.
LEGAL MATTERS
Simpson Thacher & Bartlett, New York, New York, our special counsel, will
issue a legal opinion regarding the Offered Shares.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our (Old NWA Corp.)
consolidated financial statements and schedule included in our Annual Report on
Form 10-K for the year ended December 31, 1997, as set forth in their report,
which is incorporated in this Prospectus and Registration Statement by
reference. Our consolidated financial statements are incorporated by reference
in reliance on their report, given on their authority as experts in accounting
and auditing.
13
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.The estimated expenses payable
by NWA Corp. in connection with the offering described in this Registration
Statement are as follows:
<TABLE>
<S> <C>
Registration Fee............................................... $16,374.01
Legal fees and expenses........................................ 50,000.00*
Accounting fees and expenses................................... 30,000.00*
Printing and duplicating expenses.............................. 25,000.00*
Miscellaneous expenses......................................... 92,500.00*
----------
Total.......................................................... $213,874.01
----------
----------
*Estimates
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware (the
"Delaware Law") empowers a Delaware corporation to indemnify any persons who
are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation), by reason of the fact that such person is or was an officer,
director, employee or agent of such corporation, or is or was serving at the
request of such corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise. The
indemnity may include expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding, provided that such officer,
director, employee or agent acted in good faith and in a manner he reasonably
believed to be in or not opposed to the corporation's best interests, and, for
criminal proceedings, had no reasonable cause to believe his conduct was
unlawful. A Delaware corporation may indemnity officers and directors in an
action by or in the right of the corporation under the same conditions, except
that no indemnification is permitted without judicial approval if the officer or
director is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in the defense of any action
referred to above, the corporation must indemnify him against the expenses which
such officer or director actually and reasonably incurred.
In accordance with Section 102(b)(7) of the Delaware Law, the NWA Corp.
Charter provides that the directors of NWA Corp. shall not be personally liable
to NWA Corp. or its stockholders for monetary damages for violations of their
fiduciary duty.
Article VIII of the NWA Corp. Bylaws provides for indemnification of the
officers and directors of NWA Corp. to the fullest extent permitted by
applicable law.
ITEM 16.
EXHIBITS.
<TABLE>
<C> <C> <S>
4.1...... Restated Certificate of Incorporation of Northwest Airlines Corporation (the
-- "Company").
4.2...... -- Restated Bylaws of the Company.
5.1...... -- Opinion of Simpson Thacher & Bartlett as to the validity of the Common Stock.
23.1..... -- Consent of Ernst & Young LLP.
23.2..... -- Consent of Simpson Thacher & Bartlett (included in Exhibit 5.1).
</TABLE>
II-1
<PAGE>
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities
Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the estimated
maximum offering range may be reflected on the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraph (1)(i) and (1)(ii) above do not apply if
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial BONA FIDE offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions set forth in response to Item 15, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Eagan, State of Minnesota, on December 23, 1998.
NORTHWEST AIRLINES CORPORATION
BY: /S/ DOUGLAS M. STEENLAND
-----------------------------------------
Douglas M. Steenland
EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL
AND SECRETARY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature appears
below constitutes and appoints Douglas M. Steenland and Mickey P. Foret and each
of them individually, his true and lawful agent, proxy and attorney-in-fact,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to (i) act on, sign and file with
the Securities and Exchange Commission any and all amendments (including
post-effective amendments) to this Registration Statement together with all
schedules and exhibits thereto, (ii) act on, sign and file with the Securities
and Exchange Commission any registration statement relating to this offering
that is to be effective upon filing pursuant to Rule 462(b) under the Securities
Act of 1933, as amended, (iii) act on, sign and file with the Securities and
Exchange Commission any exhibits to this Registration Statement or any such
registration statement or amendments (including post-effective amendments), (iv)
act on, sign and file such certificates, instruments, agreements and other
documents as may be necessary or appropriate in connection therewith, (v) act on
and file any supplement to any prospectus included in this Registration
Statement or any such registration statement or amendment and (vi) take any and
all actions which may be necessary, or appropriate in connection therewith,
granting unto such agents, proxies and attorneys-in-fact, and each of them
individually, full power and authority to do and perform each and every act and
thing necessary or appropriate to be done, as fully for all intents and purposes
as he might or could do in person, hereby approving, ratifying and confirming
all that such agents, proxies and attorneys-in-fact, any of them or any of his
or their substitute or substitutes may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------ --------------------------- -------------------
<C> <S> <C>
President, Chief Executive
/s/ JOHN H. DASBURG Officer and Director
- ------------------------------ (Principal Executive December 23, 1998
John H. Dasburg Officer)
Executive Vice President
/s/ MIKEY P. FORET and Chief Financial
- ------------------------------ Officer (Principal December 23, 1998
Mikey P. Foret Financial Officer)
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------ --------------------------- -------------------
<C> <S> <C>
Vice President--Finance and
/s/ ROLF S. ANDERSEN Chief Accounting Officer
- ------------------------------ (Principal Accounting December 23, 1998
Rolf S. Andersen Officer)
/s/ GARY L. WILSON Chairman of the Board of
- ------------------------------ Directors December 23, 1998
Gary L. Wilson
/s/ RICHARD C. BLUM Director
- ------------------------------ December 23, 1998
Richard C. Blum
/s/ ALFRED A. CHECCHI Director
- ------------------------------ December 23, 1998
Alfred A. Checchi
/s/ DORIS KEARNS GOODWIN Director
- ------------------------------ December 23, 1998
Doris Kearns Goodwin
/s/ MARVIN L. GRISWOLD Director
- ------------------------------ December 23, 1998
Marvin L. Griswold
Director
- ------------------------------ December , 1998
Dennis F. Hightower
/s/ GEORGE J. KOURPIAS Director
- ------------------------------ December 23, 1998
George J. Kourpias
Director
- ------------------------------ December , 1998
Frederic V. Malek
/s/ WALTER F. MONDALE Director
- ------------------------------ December 23, 1998
Walter F. Mondale
/s/ V.A. RAVINDRAN Director
- ------------------------------ December 23, 1998
V.a. Ravindran
Director
- ------------------------------ December , 1998
Leo M. Van Wijk
/s/ DUANE E. WOERTH Director
- ------------------------------ December 23, 1998
Duane E. Woerth
</TABLE>
II-4
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION OF EXHIBITS PAGES
- --------- ------------------------------------------------------------------------------------------- -----------------
<C> <S> <C>
4.1 - Restated Certificate of Incorporation of Northwest Airlines Corporation (the "Company").
4.2 - Restated Bylaws of the Company.
5.1 - Opinion of Simpson Thacher & Bartlett as to the validity of the Common Stock.
23.1 - Consent of Ernst & Young LLP
23.2 - Consent of Simpson Thacher & Bartlett (included in Exhibit 5.1)
</TABLE>
<PAGE>
Exhibit 4.1
RESTATED CERTIFICATE OF INCORPORATION
OF
NEWBRIDGE PARENT CORPORATION
Newbridge Parent Corporation, a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), hereby certifies as follows:
1. The original Certificate of Incorporation of the
Corporation was filed with the Secretary of State of the State of Delaware on
January 21, 1998 under the name Newbridge Parent Corporation.
2. This Restated Certificate of Incorporation restates,
integrates and further amends the Certificate of Incorporation of the
Corporation.
3. This Restated Certificate of Incorporation and the
amendments to the Certificate of Incorporation contained herein were declared
advisable and adopted by the Board of Directors of the Corporation on November
20, 1998, and were approved by the unanimous written consent of the sole
stockholder of the Corporation in accordance with Section 228 of the General
Corporation Law of the State of Delaware, and have been duly adopted in
accordance with the provisions of Section 242(b) and 245 of the General
Corporation Law of the State of Delaware.
4. The Certificate of Incorporation of the Corporation is
hereby restated, integrated and further amended to read in its entirety as
follows:
FIRST: The name of the Corporation is Northwest
Airlines Corporation.
SECOND: The address of the registered office of the
Corporation in the State of Delaware is The Corporation Trust
Company, Corporation Trust Center, 1209 Orange Street,
Wilmington, New Castle County, Delaware 19801. The name of its
registered agent at the address is The Corporation Trust
Company.
THIRD: The purpose of the Corporation is to engage in
any lawful act or activity for which a corporation may be
organized under the General Corporation Law of the State of
Delaware (the "Delaware General Corporation Law").
FOURTH: The total number of shares of stock which the
Corporation has authority to issue is 360,020,000 shares,
consisting of: (i) 315,000,000 shares of Common Stock, par
value $.01 per share (the "Common Stock"); and
<PAGE>
(ii) 45,020,000 shares of preferred stock, par value $.01 per
share (the "Preferred Stock").
Preferred Stock. Pursuant to Section 151 of the
Delaware General Corporation Law, the Board of Directors of
the Corporation is authorized to fix by resolution or
resolutions the designation of each series of Preferred Stock
and the powers, preferences and relative participating,
optional or other special rights and qualifications,
limitations or restrictions thereof, including, without
limiting the generality of the foregoing, such provisions as
may be desired concerning voting, redemption, dividends,
dissolution or the distribution of assets, conversion or
exchange, and such other subjects or matters as may be fixed
by resolution or resolutions of the Board of Directors under
the Delaware General Corporation Law.
FIFTH: (a) Limitation of Voting Rights.
Notwithstanding anything to the contrary contained in this
Restated Certificate of Incorporation, at no time shall Alien
Owned Shares be voted, unless such shares are registered on
the Foreign Stock Record, as defined in the Bylaws, maintained
by the Corporation. The Bylaws may contain provisions to
implement this provision.
(b) Bylaws, Legends. Etc. (i) The Bylaws of the
Corporation may make appropriate provisions to effect the
requirements of this Article FIFTH.
(ii) All certificates representing Common or
any other voting stock of the Corporation are subject to the
restrictions set forth in this Article FIFTH.
(iii) A majority of the directors of the
Corporation shall have the exclusive power to determine all
matters necessary to determine compliance with this Article
FIFTH, and the good faith determination of a majority of the
directors on such matters shall be conclusive and binding for
all the purposes of this Article FIFTH.
(c) Beneficial Ownership Inquiry. (i) The Corporation
may by notice in writing (which may be included in the form of
proxy or ballot distributed to stockholders of the Corporation
in connection with the annual meeting (or any special meeting)
of the stockholders of the Corporation, or otherwise) require
a Person that is a holder of record of equity securities of
the Corporation or that the Corporation knows to have, or has
reasonable cause to believe has, Beneficial Ownership of
equity securities of the Corporation to certify in such manner
as the Corporation shall deem appropriate (including by way of
execution of any form of proxy or ballot by such Person) that,
to the knowledge of such Person:
(A) all equity securities of the Corporation as to
which such Person has record ownership or Beneficial Ownership
are owned and controlled only by U.S. Citizens; or
2
<PAGE>
(B) the number and class or series of equity
securities of the Corporation owned of record or Beneficially
Owned by such Person that are owned or controlled by Persons
who are not U.S. Citizens are as set forth in such
certificate.
(ii) With respect to any equity securities
identified by such Person in response to Section (c)(i) of
this Article FIFTH, the Corporation may require such Person to
provide such further information as the Corporation may
reasonably require in order to implement the provisions of
this Article FIFTH.
(iii) For purposes of applying the
provisions of this Article FIFTH with respect to any equity
securities of the Corporation, in the event of the failure of
any Person to provide the certificate or other information to
which the Corporation is entitled pursuant to this Section
(c), the Corporation shall presume that the equity securities
in question are owned or controlled by Persons who are not
U.S. Citizens.
SIXTH: The following provisions are inserted for the
management of the business and the conduct of the affairs of
the Corporation, and for further definition, limitation and
regulation of the powers of the Corporation and of its
directors and stockholders:
(1) The Board of Directors shall have
concurrent power with the stockholders to make,
alter, amend, change, add to or repeal the Bylaws of
the Corporation.
(2) The number of directors of the
Corporation shall be as from time to time fixed by,
or in the manner provided in, the Bylaws of the
Corporation. Election of directors need not be by
written ballot unless the Bylaws so provide.
SEVENTH: Meetings of stockholders may be held within
or without the State of Delaware, as the Bylaws may provide.
Any action required or permitted to be taken by the
stockholders of the Corporation must be effected at a duly
called annual or special meeting of such stockholders and may
not be effected by any consent in writing by such
stockholders. The books of the Corporation may be kept
(subject to any provision contained in the Delaware General
Corporation Law) outside the State of Delaware at such place
or places as may be designated from time to time by the Board
of Directors or in the Bylaws of the Corporation.
EIGHTH: To the fullest extent permitted by the
Delaware General Corporation Law (including the provisions
thereof regarding advancement of expenses), the Corporation
shall indemnify any current or former director or officer of
the Corporation and may, at the discretion of the Board of
Directors, indemnify any current or former employee or agent
of the Corporation against all expenses, judgments, fines,
ERISA excise taxes or penalties and amounts paid in
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settlement actually and reasonably incurred by him or her in
connection with any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative, brought by or in the right of the Corporation
or otherwise, to which he or she was or is a party or is
threatened to be made a party by reason of his or her current
or former position with the Corporation or by reason of the
fact that he or she is or was serving, at the request of the
Corporation, as a director, officer, partner, trustee,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise (including, without
limitation, any employee benefit plan). Except as otherwise
provided by the Delaware General Corporation Law, no director
of the Corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director. Any repeal or
modification of this Article EIGHTH shall not adversely affect
any right or protection of an officer or a director of the
Corporation existing at the time of such repeal or
modification. To the fullest extent permitted by the Delaware
General Corporation Law, the foregoing rights in this Article
EIGHTH shall be deemed to be a contract between the
Corporation and each director who served or serves at any time
while this Article EIGHTH is in effect. Any right or
protection of an officer or a director of the Corporation
under this Article EIGHTH shall inure to the benefit of the
indemnitee's heirs, executors, and administrators.
NINTH: Attached hereto as Exhibit C are the terms and
provisions of the Series C Preferred Stock (the "Certificate
of Designation for Series C Preferred Stock"), which terms and
provisions are incorporated herein and made a part hereof.
TENTH: Attached hereto as Exhibit D are the terms and
provisions of the Series D Preferred Stock (the "Certificate
of Designation for Series D Preferred Stock"), which terms and
provisions are incorporated herein and made a part hereof.
ELEVENTH: The following terms shall have the
following meaning for the purpose of this Restated Certificate
of Incorporation:
"Alien Owned Shares" shall mean any shares of any
class of outstanding voting stock of the Corporation which are
owned, of record or beneficially, or otherwise controlled, by
any Person or Persons who are not United States Citizens.
"Beneficial Ownership," "Beneficially Owned," or
"Owned Beneficially" refers to beneficial ownership as defined
in Rule 13d-3 (without regard to the 60-day provision in
paragraph (d)(l)(i) thereof) under the Exchange Act.
"DOT" shall mean the United States Department of
Transportation or any other federal department or agency at
the time administering the Federal Aviation Act.
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"Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
"Permitted Percentage" shall mean 25% of the voting
interest in the Corporation, or such other percentage of the
voting interest in the Corporation as hereafter may be owned
or controlled by persons who are not United States Citizens
without loss, under Section 1301(16) of Title 49 of the United
States Code or any successor or other applicable law or
regulation, of the United States Citizen status of the
Corporation or any Subsidiary.
"Person" shall mean any individual, corporation,
partnership, trust or other entity of any nature whatsoever.
"Qualified Holder" shall mean with respect to a share
of Common Stock any person who (a) is the current or former
employee of the Corporation or one of its subsidiaries (a
"Corporation Employee") to whom such stock is allocated under
the Northwest Airlines Corporation Employee Stock Plan (the
"Plan") or under any separate arrangements (other than the
Plan) ("Separate Arrangements") under which Series C Preferred
Stock is issued pursuant to the Letter Agreements, as defined
in the Certificate of Designation of such preferred stock, in
respect of the Plan, and to whom such stock is distributed
from the trusts for the benefit of Corporation Employees in
respect of the Plan or pursuant to the Separate Arrangements,
(b) is a trustee or custodian under the Plan, any Separate
Arrangement, any other qualified plan maintained by the
Corporation or an individual retirement account of a
Corporation Employee referred to in clause (a) above or such
employee's death beneficiary, (c) is the spouse or child of a
Corporation Employee referred to in clause (a) above, or a
trust for the benefit of such spouse or child, to whom such
stock is transferred by such employee, or (d) in the event of
the death of a Corporation Employee referred to in clause (a)
above, is an heir, executor, administrator, testamentary
trustee or legatee of such employee by operation of such
employee's will or the laws of intestacy.
"Retained Earnings" shall mean retained earnings of
the Corporation as calculated in accordance with generally
accepted accounting principles in the United States, on a
consolidated basis.
"Stockholders' Agreement" shall mean the Investor
Stockholders' Agreement dated as of July 21, 1989, as amended,
among the Corporation and certain other Persons, a copy of
which shall be maintained by the Corporation at its registered
office in Delaware or at its principal place of business.
"Subsidiary" shall mean any corporation of which a
majority of any class of equity security is owned, directly or
indirectly, by the Corporation.
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"Transfer" shall mean any transfer, sale, assignment,
exchange, mortgage, pledge, hypothecation or other disposition
of any Common Stock or any interest therein.
"United States Citizen" shall mean any person who is
a Citizen of the United States as defined in Section 1301(16)
of Title 49 of the United States Code, as in effect on the
date in question, or any successor statute or regulation.
TWELFTH: The Corporation reserves the right to amend,
alter, change or repeal any provisions contained in this
Restated Certificate of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
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EXHIBIT C
CERTIFICATE OF DESIGNATIONS
OF
SERIES C VOTING PREFERRED STOCK
OF
NEWBRIDGE PARENT CORPORATION
(which shall be renamed Northwest Airlines Corporation)
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
-------------------
Newbridge Parent Corporation, a corporation organized and
existing under the General Corporation Law of the State of Delaware (hereinafter
called the "Corporation"; it being understood that such term, with respect to
all times prior to the merger of Newbridge Merger Corporation, a Delaware
corporation, with and into Northwest Airlines Corporation, a Delaware
corporation ("Old Northwest"), shall refer to Old Northwest), hereby certifies
that the following resolution was duly adopted by the Board of Directors of the
Corporation as required by Section 151 of the General Corporation Law of the
State of Delaware by written consent in lieu of a meeting on November 20, 1998:
RESOLVED, that pursuant to the authority granted to and vested
in the Board of Directors of the Corporation (hereinafter called the "Board of
Directors" or the "Board") in accordance with the provisions of the
Corporation's Restated Certificate of Incorporation, as amended to date
(hereinafter called the "Certificate of Incorporation"), the Board of Directors
hereby creates a series of Preferred Stock, par value $.01 per share (the
"Preferred Stock"), of the Corporation and hereby states the designation and
number of shares, and fixes the relative rights, powers and preferences thereof,
and the limitations thereof, as follows:
(1) Designation. The designation of the series of Preferred
Stock authorized by this resolution shall be Series C Voting Preferred Stock,
par value $0.01 per share" (the "Series C Voting Preferred Stock"), consisting
of 25,000,000 shares.
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(2) Rank. The Series C Voting Preferred Stock shall, with
respect to dividend, repurchase, repayment and redemption rights and rights on
any liquidation, winding up or dissolution of the Corporation, rank junior to
the series A preferred stock, par value $0.01 per share (the "Series A Preferred
Stock") of the Corporation and the series B preferred stock, par value $0.01 per
share (the "Series B Preferred Stock"), of the Corporation. The Series C Voting
Preferred Stock shall, with respect to dividend, repurchase, repayment and
redemption rights and rights on any liquidation, winding up or dissolution of
the Corporation, rank prior to all classes of the common stock, par value $0.01
per share, of the Corporation. All equity securities of the Corporation to which
the Series C Voting Preferred Stock may rank prior with respect to dividends and
upon liquidation, dissolution, winding up or otherwise are collectively referred
to herein as the "Junior Securities"; all equity securities of the Corporation
as to which the Series C Voting Preferred Stock may rank on a parity as to any
one of dividends or upon liquidation, dissolution, winding up or otherwise and
does not rank senior as to any of the same are collectively referred to herein
as the "Parity Securities"; and all equity securities of the Corporation to
which the Series C Voting Preferred Stock may rank junior, whether with respect
to dividends or upon liquidation, dissolution, winding up or otherwise, are
collectively referred to herein as the "Senior Securities". The Series C Voting
Preferred Stock shall be subject to the creation of Junior Securities, Parity
Securities and Senior Securities.
(3) Dividends. (i) The holders of the shares of Series C
Voting Preferred Stock shall be entitled to receive, when, as and if declared by
the Board of Directors, out of funds legally available for the payment of
dividends, cumulative dividends at the annual rate described in paragraph
(3)(ii) (the "Dividend Rate"). Such dividends shall accrue annually in arrears.
The first dividend shall accrue on August 1, 1994 (unless the Common Stock, par
value $.01 per share, of the Corporation (the "Common Stock") is Publicly Traded
prior to August 1, 1994, in which event no dividend shall accrue) and
thereafter, dividends shall accrue on each August 1 (each date on which
dividends are scheduled to accrue being a "Dividend Date"); provided, however,
that if the Common Stock becomes Publicly Traded during the twelve-month period
from one Dividend Date to the next Dividend Date (each such period, a "Dividend
Year"), then no dividend shall accrue for such Dividend Year or any Dividend
Year thereafter, provided, further, that if thereafter during such Dividend Year
or during any succeeding Dividend Year, the Common Stock should not be Publicly
Traded on the business day immediately preceding the Dividend Date for such
Dividend Year, the dividend shall commence accruing in full once again, in the
manner described herein, commencing on the Dividend Date occurring at the end of
such Dividend Year. Such dividends shall accrue to those parties who hold the
Series C Voting Preferred Stock of record, or who are deemed pursuant to Section
2.2 of the Letter Agreements to hold such Series C Voting Preferred Stock, at
the close of business on the fifteenth day of the month immediately preceding
each Dividend Date (each of such dates being a "Record Date"). Each of such
annual dividends shall be fully cumulative and shall accrue (whether or not
declared), without interest, from the first day of the twelve-month period at
the end of which such dividend may be accrued as herein provided.
(ii) (a) The Dividend Rate per share of Series C Voting
Preferred Stock shall be 5% per annum of (i) the aggregate Actual Savings
realized by the Corporation for all holders of Series C Voting Preferred Stock
from the Wage Savings Date to the Dividend Date, increased by the aggregate
amount of the previously accrued dividends, divided by (ii) the total number of
shares of Series C Voting Preferred Stock issued (or deemed, pursuant to Section
2.2
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of the Letter Agreements, to have been issued by the Corporation), without
taking into account any exercise of the Special Conversion Option; provided,
however, that dividends shall cease to accrue with respect to any share of the
Series C Voting Preferred Stock upon either the conversion or repurchase of such
share.
(b) In the event that the Corporation fails to take such
action with respect to all of the Series C Voting Preferred Stock with respect
to which the Put Right is exercisable pursuant to the terms of paragraphs 9(i)
or 9 (iii) upon exercise of such Put Right, effective as of the Put Date each
outstanding share of Series C Voting Preferred Stock shall start to accrue a
quarterly dividend at a rate equal to the greater of (x) 12% per annum or (y)
the highest dividend rate payable on any then outstanding series or class of the
Corporation's preferred stock in the event of a default by the Corporation in
the redemption or payment of dividends on such series or class of preferred
stock, in each case of the amount per share specified in Section 3 (ii)(a)
above, until such shares are repurchased in accordance with paragraphs 9(i) or 9
(iii).
(iii) All dividends accrued with respect to shares of the
Series C Voting Preferred Stock pursuant to paragraph (3)(i) shall accrue pro
rata to the holders entitled thereto.
(iv) Subject to the foregoing provisions of this paragraph
(3) and the provisions of paragraph 9(iv), the Board of Directors may declare,
and the Corporation may pay or set apart for payment, dividends and other
distributions on any of the Junior Securities or Parity Securities, and may
repurchase or otherwise redeem any of the Junior Securities or Parity Securities
or any warrants, rights, options or other securities exercisable for or
convertible into any of the Junior Securities or Parity Securities, and the
holders of the shares of the Series C Voting Preferred Stock shall not be
entitled to share therein.
(4) Liquidation Preference. (i) In the event of any voluntary
or involuntary liquidation, dissolution or winding up of the affairs of the
Corporation, the holders of shares of Series C Voting Preferred Stock then
outstanding shall be entitled to be paid out of the assets of the Corporation
available for distribution to its stockholders an amount in cash equal to the
Put Price for each such share outstanding on the date of liquidation,
dissolution or winding up before any payment shall be made or any assets
distributed to the holders of any of the Junior Securities.
Except as provided in the preceding sentence, holders of
Series C Voting Preferred Stock shall not be entitled to any distribution in the
event of liquidation, dissolution or winding up of the affairs of the
Corporation. If the assets of the Corporation are not sufficient to pay in full
the liquidation payments payable to the holders of outstanding shares of the
Series C Voting Preferred Stock and any Parity Securities, after payment in full
of any liquidation preference on any Senior Securities, then the holders of all
such shares shall share ratably in such distribution of assets in accordance
with the amount which would be payable on such distribution if the amounts to
which the holders of outstanding shares of Series C Voting Preferred Stock and
the holders of outstanding shares of such Parity Securities are entitled were
paid in full.
(ii) For the purposes of this paragraph 4, neither the
voluntary sale, conveyance, exchange or transfer (for cash, shares of stock,
securities or other consideration) of all or substantially all the property or
assets of the Corporation nor the consolidation or merger of the Corporation
with one or more other corporations shall be deemed to be a voluntary or
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involuntary liquidation, dissolution or winding up; provided, however, in the
event that the Corporation or Northwest Airlines, Inc. ("Northwest") is sold as
an entirety (whether pursuant to a sale of stock, merger, asset sale or
otherwise) prior to the end of the Wage Savings Period, either (a) the issuance
of any Series C Voting Preferred Stock which is required to be issued in the
future by the Corporation pursuant to the Letter Agreements in respect of the
remainder of the Wage Savings Period but which has not yet been so issued
("Unissued Series C Voting Preferred Stock"), and the issuance of any common
stock of the Corporation which is required to be issued in lieu of Unissued
Series C Voting Preferred Stock following the exercise of the Special Conversion
Option, shall be accelerated to the time of such sale or to a time prior to such
sale sufficient to ensure the holders of such stock shall be entitled to
participate in such transaction or (b) other arrangements reasonably acceptable
to the Unions shall be made so that the holders of the Series C Voting Preferred
Stock or persons entitled to receive such common stock shall receive the value
of such shares of Series C Voting Preferred Stock or common stock (as the case
may be) as if such shares had been fully issued at the time of such sale.
(5) Optional Redemption. (i) Notwithstanding Section 3.1(d) of
the Letter Agreements, and subject to Sections 2, 6(iv) and 6(v) hereof, the
Corporation may redeem at its option the Series C Voting Preferred Stock, at any
time and from time to time following August 1, 1996, in whole or in part, at a
redemption price equal to the Put Price per share without interest, to the
extent the Corporation shall have funds legally available for such payment;
provided, however, that the Corporation shall not redeem any shares of Series C
Preferred Stock prior to the redemption in full of the Series A Preferred Stock
and Series B Preferred Stock.
(ii) Shares of Series C Voting Preferred Stock which have
been issued and reacquired in any manner, including shares purchased or redeemed
or exchanged, shall (upon compliance with any applicable provisions of the laws
of the State of Delaware) have the status of authorized and unissued shares of
Preferred Stock undesignated as to series and may be redesignated and reissued
as part of any series of the Preferred Stock.
(6) Procedure for Redemption. (i) In the event the Corporation
shall redeem shares of Series C Voting Preferred Stock, written notice of such
redemption shall be given by first class mail, postage prepaid, mailed not less
than 60 days prior to the redemption date, to each holder of record of the
shares to be redeemed at such holder's address as the same appears on the stock
register of the Corporation; provided, however, that no failure to give such
notice nor any defect thereon shall affect the validity of the proceeding for
the redemption of any shares of Series C Voting Preferred Stock to be redeemed
except as to any holder to whom the Corporation has failed to give said notice
and any holder whose notice was defective. Each such notice shall state: (v) the
redemption date; (w) the number of shares of Series C Voting Preferred Stock to
be redeemed and, if less than all the shares held by such holder are to be
redeemed from such holder pursuant to paragraph 5(i), the number of shares to be
redeemed or exchanged from such holder; (x) the redemption price; (y) the place
or places where certificates for such shares are to be surrendered for payment
of the redemption price; and (z) that dividends on the shares to be redeemed
shall cease to accrue on such redemption date.
(ii) Notice having been mailed as aforesaid, from and after
the redemption date (unless default shall be made by the Corporation in
providing money for the payment of the redemption price of the shares called for
redemption) dividends on the shares of Series C Voting
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Preferred Stock so called for redemption shall cease to accrue and said shares
shall no longer be deemed to be outstanding and shall have the status of
authorized but unissued shares of Preferred Stock, unclassified as to series,
and shall not be reissued as shares of Series C Voting Preferred Stock, and all
rights of the holders thereof as stockholders of the Corporation (except the
right to receive from the Corporation the redemption price and the rights
provided in paragraph 6 (iii)) shall cease. Upon surrender in accordance with
said notice of the certificates for any shares so redeemed (properly endorsed or
assigned for transfer, if the Board of Directors of the Corporation shall so
require and the notice shall so state), such shares shall be redeemed by the
Corporation at the redemption price aforesaid. In case fewer than all the shares
represented by any such certificate are redeemed or exchanged, a new certificate
shall be issued representing the unredeemed shares without cost to the holder
thereof.
(iii) Holders of Series C Voting Preferred Stock to be
redeemed shall be permitted to convert such shares of Series C Voting Preferred
Stock in accordance with the terms set forth in Section 8 hereof during the
60-day notice period.
(iv) In the event that fewer than all the outstanding
shares of Series C Voting Preferred Stock are to be redeemed pursuant to
paragraph 5(i), the number of shares to be redeemed shall be determined by the
Board of Directors, and the shares shall be redeemed pro rata among the holders
thereof, including the Trusts and Separate Arrangements (as each such term is
defined in paragraph (4)(iv)), and, within each Trust or Separate Arrangement,
shall be redeemed among the employees who are the beneficiaries of such Trust or
Separate Arrangement in accordance with the terms of such Trust or Separate
Arrangement.
(v) Notwithstanding any other provision of this Section
(6), each trust and separate arrangement to which Series C Voting Preferred
Stock was issued pursuant to the Letter Agreements for the benefit of members of
the Unions or management employees (the "Trusts" and "Separate Arrangements")
may retain, for purposes of exercising the corporate governance rights provided
herein and in the By-laws of the Corporation, at least one share of Series C
Voting Preferred Stock, which shall not be subject to optional redemption
pursuant to paragraph 5 prior to the earlier of (x) August 1, 2003 and (y) the
date on which the number of outstanding shares of Employee Stock constitutes
less than 25% of the shares of Employee Stock outstanding on August 1, 1996;
provided, however, that a minimum number of shares shall be retained by such
Trusts and Separate Arrangements so that the proportion of voting rights held by
such Trusts and Separate Arrangements in respect of the Series C Voting
Preferred Stock immediately prior to any optional redemption shall be maintained
subsequent to any optional redemption.
(7) Voting Rights. (i) The Series C Voting Preferred Stock
shall be entitled to vote in parity with all voting common stock of the
Corporation on all matters submitted to stockholders for vote, except as set
forth below with respect to the election of directors. The per share vote of
each share of Series C Voting Preferred Stock at any time shall be equal to (a)
(1) the total number of shares of Series C Voting Preferred Stock issued or to
be issued pursuant to the Letter Agreements either to the Trusts or pursuant to
any Separate Arrangements (assuming no exercise of the Special Conversion
Option) or, if greater, the number of shares of Common Stock into which all such
shares of Series C Voting Preferred Stock (including any shares of Series C
Voting Preferred Stock (x) not yet issued, (y) already converted or (z) with
respect to which the Special Conversion Option has been exercised) would be
convertible at such time
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hereunder, minus (2) the total number of shares of Series C Voting Preferred
Stock which, prior to such time, have been converted into shares of common
stock, or, if greater, the number of shares of Common Stock into which those
shares would be convertible at such time if they had not previously been
converted, divided by (b) the total number of shares of Series C Voting
Preferred Stock then outstanding.
(ii) (a) So long as any shares of the Series C Voting
Preferred Stock are outstanding, the Series C Voting Preferred Stock shall be
entitled to elect three directors, each of whom shall be an individual who is at
that time of his election an eligible candidate by virtue of satisfying the
qualifications described in paragraph 7(ii)(b) below and who thereafter
continues to satisfy such qualifications; shall be elected exclusively by the
holders of the Series C Voting Preferred Stock as set forth in paragraph 7 (ii)
(c) below. Prior to August 1, 1996, the number of Series C Directors shall
constitute not less than 20% of the number of directors sitting on the Board of
Directors. After August 1, 1996 the number of Series C Directors shall be the
greater of (i) three or (ii) 15% of the total number of directors then setting
on the Board of Directors. Subject to the foregoing provisions, the Corporation
may increase the size of the Board of Directors at any time. Holders of Series C
Voting Preferred Stock shall not be entitled to vote such stock for the election
of any directors of the Corporation other than the Series C Directors.
(b) Of the three directors that the holders of Series C Voting
Preferred Stock shall be entitled to elect, one shall be qualified to serve as a
Series C Director by virtue of being nominated by the President of the IBT, one
by virtue of being nominated by the President of the IAM and one by virtue of
being nominated by the Northwest Airlines, Inc. Master Executive Council of
ALPA. If the holders of Series C Voting Preferred Stock are entitled under the
terms hereof to elect more than three directors, ALPA, the IBT, and the IAM,
each acting through its President or the Northwest Airlines, Inc. Master
Executive Council of ALPA, shall each be entitled to nominate one-third of the
Series C Directors and if the total number of Series C Directors is not a
multiple of three, any remaining Series C Directors shall be nominated by a
unanimous vote of the existing Series C Directors designated by the three
unions. Only those individuals who are nominated in accordance with this
paragraph 7(ii)(b) shall be qualified to serve as Series C Directors.
(c) The holders of Series C Voting Preferred Stock shall be
entitled to vote on the slate of Series C Directors nominated in accordance with
the provisions set forth herein or, to the extent not inconsistent with the
provisions herein, in the bylaws of the Corporation, and shall not have the
right to vote on the election of any single Series C Director individually.
(d) In the event that the Corporation fails to repurchase all
of the Series C Voting Preferred Stock with respect to which the Put Right is
exercisable pursuant to paragraphs 9(i) or 9 (iii), effective as of the Put
Date, the number of Series C Directors shall be increased to the greater of (x)
three more than the number of Series C Directors then serving on the
Corporation's Board of Directors or (y) the number of directors that would cause
the proportion of Series C Directors to the total number of directors to be
equal to the proportion of the total voting power of all shares of Series C
Voting Preferred Stock then outstanding to the total voting power of all shares
of all voting capital stock of the Corporation then outstanding.
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(iii) The entitlement of the Series C Voting Preferred Stock
to elect the Series C Directors shall expire on the first date on which no
shares of Series C Voting Preferred Stock are outstanding, whether as a result
of conversions, exchanges, repurchases or redemptions.
(8) Conversion Rights. (i) The Series C Voting Preferred Stock
shall be convertible at any time into common stock of the Corporation on the
basis set forth below. Except to the extent otherwise provided in this paragraph
8, each share of Series C Voting Preferred Stock shall be convertible into 1.364
shares of Common Stock.
(ii) On or before the earlier of (a) April 30, 1994 (or, if
later, 30 days after the audited consolidated financial statements of the
Corporation for the fiscal year ended December 31, 1993 have been made available
to the Unions) or (b) 10 days after the filing with the Securities and Exchange
Commission of a registration statement relating to an underwritten initial
public offering of the Common Stock representing not less than 10% of the Common
Stock outstanding on a fully diluted basis after giving effect to such offering,
each of (x) the Trustees of the Trusts and Separate Arrangements, (except for
those Trusts and Separate Arrangements for the benefit of ALPA employees who are
members of the Air Line Pilots Association International ("ALPA"), or the trust
beneficiaries to the extent specified below); and (y) ALPA with respect to the
Trusts and Separate Arrangements for the benefit of ALPA employees, shall have
the right (A) to convert each share of Series C Voting Preferred Stock held by
such Trust or Separate Arrangement into 1.909 shares of Common Stock and (B) to
receive, in respect of all future contributions to such Trust or Separate
Arrangement, Common Stock in lieu of Series C Voting Preferred Stock, at the
same conversion rate specified in clause (A) above; provided, however, that such
right may be exercised with respect to some or all of the shares of Series C
Voting Preferred Stock held or to be received by such Trust or Separate
Arrangement but may be exercised not more than once. The right set forth in this
paragraph 8(ii) is referred to herein as the "Special Conversion Option." The
Special Conversion Option may be exercised by the trust beneficiaries with
respect to stock allocated to their accounts only if the Corporation has
previously filed a registration statement with the Securities and Exchange
Commission with respect to the Common Stock to be received upon exercise of such
option.
(iii) [DELETED]
(iv) [DELETED]
(v) Each share of Series C Voting Preferred Stock shall
automatically convert into 1.364 shares of the Common Stock upon the sale,
transfer, exchange or other disposition of record or beneficial ownership of
such share to (or with) any person who is not a Qualified Holder (a
"Non-Qualified Sale").
(vi) The shares of Series C Voting Preferred Stock shall be
convertible at the main office of the Corporation, and at such other office or
offices, if any, as the Board of Directors may designate, into fully paid and
non-assessable shares (calculated as to each conversion to the nearest
one-hundredth of a share) of Common Stock, at the Conversion Ratio in effect at
the time of conversion set forth above. As used herein, "Conversion Ratio" shall
mean a fraction of which the numerator shall be one and the denominator shall be
the number of shares
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of Common Stock into which each share of Series C Voting Preferred Stock is
convertible as provided herein. The Conversion Ratio shall be subject to
adjustment from time to time as set forth below. In order to convert shares of
Series C Voting Preferred Stock into Common Stock the holder thereof shall
surrender at any office hereinabove mentioned the certificate or certificates
therefor, duly endorsed or assigned to the Corporation or in blank, and give
written notice to the Corporation at such office that he or she elects to
convert such shares. No payment or adjustment shall be made upon any conversion
on account of any dividends accrued on the shares of Series C Voting Preferred
Stock surrendered for conversion or on account of any dividends on the Common
Stock issued upon conversion.
(vii) Shares of Series C Voting Preferred Stock shall be
deemed to have been converted immediately prior to the close of business on the
day of the surrender of such shares for conversion in accordance with the
foregoing provisions, and the person or persons entitled to receive the Common
Stock issuable upon such conversion shall be treated for all purposes as the
record holder or holders of such Common Stock at such time. As promptly as
practicable on or after the conversion date, the Corporation shall issue and
shall deliver at such office a certificate or certificates for the number of
full shares of Common Stock issuable upon such conversion, together with payment
at the Trading Price in lieu of any fraction of a share, as hereinafter
provided, to the person or persons entitled to receive the same.
(viii) In case at any time after the issuance of the Series C
Voting Preferred Stock, the Corporation shall pay or make a dividend or other
distribution on any class of capital stock of the Corporation in shares of its
Common Stock, the Conversion Ratio in effect at the opening of business on the
day following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be adjusted so that the same
shall equal the ratio determined by multiplying such Conversion Ratio by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
and the denominator shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution, such
reduction to become effective immediately after the opening of business on the
day following the date fixed for such determination. For the purposes of this
paragraph 8(viii), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Corporation but shall
include shares issuable in respect of scrip certificates issued in lieu of
fractions of shares of Common Stock. The Corporation shall not pay any dividend
or make any distribution on shares of Common Stock held in the treasury of the
Corporation.
(ix) In case at any time after the issuance of the Series C
Voting Preferred Stock, the Corporation shall issue rights or warrants (other
than those referred to in paragraph 8(xii) or stock options granted to
Corporation Employees) to all holders of its Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share less than
the Trading Price per share of the Common Stock on the date fixed for the
determination of shareholders entitled to receive such rights or warrants, the
Conversion Ratio in effect at the opening of business on the day following the
date fixed for such determination shall be adjusted so that the same shall equal
the ratio determined by multiplying such Conversion Ratio by a fraction of which
the numerator shall be the number of shares of Common Stock outstanding at the
close of business on the date fixed for such determination plus the number of
shares of Common Stock which the aggregate of the offering price of the total
number of shares of
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Common Stock so offered for subscription or purchase would purchase at such
Trading Price and the denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock so offered for subscription or
purchase, such reduction to become effective immediately after the opening of
business on the day following the date fixed for such determination. For the
purposes of this paragraph 8(ix), the number of shares of Common Stock at any
time outstanding shall not include shares held in the treasury of the
Corporation but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The Corporation shall not
issue any rights or warrants in respect of shares of Common Stock held in the
treasury of the Corporation.
(x) In case at any time after the issuance of the Series C
Voting Preferred Stock, outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Conversion Ratio in effect
at the opening of business on the day following the day upon which such
subdivision becomes effective shall be proportionately reduced, and, conversely,
in case at any time after the issuance of the Series C Voting Preferred Stock,
outstanding shares of Common Stock shall each be combined into a smaller number
of shares of Common Stock, the Conversion Ratio in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately increased, such increase or reduction, as the
case may be, to become effective immediately after the opening of business on
the day following the day upon which such subdivision or combination becomes
effective.
(xi) In case at any time after the issuance of the Series C
Voting Preferred Stock, the Corporation shall, by dividend or otherwise,
distribute to all holders of its Common Stock (a) any rights or warrants to
subscribe for or purchase any security of the Corporation (other than those
referred to in paragraphs 8(ix) and 8(xii) or stock options granted to
Corporation Employees) or any evidence of indebtedness or other securities of
the Corporation (other than Common Stock), or (b) cash or other assets (other
than any regular quarterly dividend payable solely in cash out of retained
earnings of the Corporation that may from time to time be fixed by the Board of
Directors of the Corporation), having a fair market value (as determined in a
resolution adopted by the Board of Directors, which shall be conclusive evidence
of such fair market value) in an amount during any 12-month period equal to 10%
or more of an amount determined by multiplying the number of shares of Common
Stock outstanding on the record date for the determination of holders of Common
Stock entitled to receive such distribution, by the Trading Price per share of
the Common Stock on such record date, then in each such case the Conversion
Ratio shall be adjusted so that the same shall equal the ratio determined by
multiplying the Conversion Ratio in effect immediately prior to the close of
business on the date fixed for the determination of shareholders entitled to
receive such distribution by a fraction of which the numerator shall be the
Trading Price per share of the Common Stock on the date fixed for such
determination less the then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a
resolution) of the portion of the assets or evidences of indebtedness so
distributed applicable to one share of Common Stock and the denominator shall be
such Trading Price per share of the Common Stock, such adjustment to become
effective immediately prior to the opening of business on the day following the
date fixed for the determination of shareholders entitled to receive such
distribution.
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(xii) (a) In case the Corporation shall, at any time after
the issuance of the Series C Voting Preferred Stock, distribute rights or
warrants, other than rights or warrants to purchase Common Stock at a price per
share equal to or greater than the Trading Price of the Common Stock on the day
next preceding the Trigger Date (as defined below) in respect thereof which are
not exercisable until the occurrence of such Trigger Date, pro rata to all
holders of Common Stock ("Rights") and the date triggering the exercisability of
such Rights (the "Trigger Date") shall have occurred, thus permitting the
holders of such Rights irrevocably to exercise any exchange, subscription or
purchase rights conferred by such Rights, the Conversion Ratio in effect at the
opening of business on the Trigger Date shall be adjusted so that the same shall
equal the ratio determined by multiplying the Conversion Ratio in effect
immediately prior to the close of business on the day prior to the Trigger Date
by a fraction of which the numerator shall be the Trading Price per share of the
Common Stock on the day prior to the Trigger Date less the fair market value of
the Rights so distributed applicable to one share of Common Stock on the Trigger
Date (as determined by the Board of Directors, whose determination shall be
conclusive and described in a resolution) and the denominator shall be such
current Trading Price per share of the Common Stock.
(b) Prior to any Trigger Date, the holder of shares of Series
C Voting Preferred Stock shall be entitled to receive upon conversion of such
shares, in addition to the shares of Common Stock issuable upon conversion of
such shares of Series C Voting Preferred Stock (the "Conversion Shares"), the
maximum number of the relevant Rights that any holder of a number of shares of
Common Stock equal to the number of Conversion Shares owns or is entitled to
receive at the time of such conversion in accordance with the terms of and
provisions applicable to such Rights.
(c) Notwithstanding the foregoing, in the event that the
Corporation shall distribute Rights pro rata to all holders of Common Stock, the
Corporation may, in lieu of making any adjustment pursuant to this Section, make
proper provision so that each holder of shares of Series C Voting Preferred
Stock who converts such shares (or any portion thereof) after the date fixed for
the determination of shareholders entitled to receive such Rights and prior to
the redemption, expiration, or other termination of the Rights shall be entitled
to receive upon such conversion, in addition to the Conversion Shares, a number
of Rights to be determined as follows: (1) if such conversion occurs on or prior
to the relevant Trigger Date for such Rights, the maximum number of Rights to
which any holder of a number of shares of Common Stock equal to the number of
Conversion Shares has received or is entitled to receive at the time of such
conversion in accordance with the terms and provisions of and applicable to such
Rights; and (2) if such conversion occurs after such Trigger Date, the maximum
number of Rights to which any holder of the number of shares of Common Stock
into which the shares of Series C Voting Preferred Stock so converted were
convertible immediately prior to such Trigger Date would have been entitled on
such Trigger Date in accordance with the terms and provisions of and applicable
to the Rights.
(xiii) The reclassification of Common Stock into securities
including other than Common Stock (other than any reclassification upon a
consolidation or merger) shall be deemed to involve (a) a distribution of such
securities other than Common Stock to all holders of Common Stock (and the
effective date of such reclassification shall be deemed to be "the date fixed
for the determination of stockholders entitled to receive such distribution" and
"the date
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fixed for such determination" within the meaning of paragraph 8(xi)), and (b) a
subdivision or combination, as the case may be, of the number of shares of
Common Stock outstanding immediately prior to such reclassification into the
number of shares of Common Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed to be "the day upon
which such subdivision becomes effective" or "the day upon which such
combination becomes effective", as the case may be, and "the day upon which such
subdivision or combination becomes effective" within the meaning of paragraph
8(x)).
(xiv) The Corporation may make such adjustments in the
Conversion Ratio, in addition to those required by paragraphs 8 (viii), 8(ix),
8(x), 8(xi), 8(xii) and 8(xiii), as it considers to be advisable in order that
any event treated for United States federal income tax purposes as a dividend of
stock or stock rights shall not be taxable to the holders of Common Stock.
(xv) No adjustment in the Conversion Ratio shall be required
unless such adjustment would require an increase or decrease of at least one
percent in such ratio; provided, however, that any adjustments which by reason
of this paragraph 8(xv) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this
paragraph 8 shall be made to the nearest one-hundredth of a share.
(xvi) Whenever the Conversion Ratio is adjusted as herein
provided, the Corporation shall compute the adjusted Conversion Ratio in
accordance with this paragraph 8 and shall prepare a notice stating that the
Conversion Ratio has been adjusted and setting forth the adjusted Conversion
Ratio that shall forthwith be required, and such notice shall be provided by the
Corporation to all holders of Series C Voting Preferred Stock.
(xvii) The Corporation shall at all times reserve and keep
available, free from preemptive rights, out of its authorized but unissued
Common Stock, for the purpose of effecting the conversion of shares of Series C
Voting Preferred Stock, the full number of shares of Common Stock then
deliverable upon the conversion of all shares of Series C Voting Preferred Stock
then outstanding.
(xviii) The Corporation shall pay any and all taxes that may
be payable in respect of the issue or delivery of shares of Common Stock on
conversion of shares of the Series C Voting Preferred Stock; provided, however,
that the Corporation shall not pay any state or federal income taxes owed by any
holder of the Series C Voting Preferred Stock. In addition, the Corporation
shall not be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of shares of Common Stock in a name
other than that in which the shares of Series C Voting Preferred Stock so
converted 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.
(9) Put Right. (i) During the 60-day period ending on the Put
Date, each Qualified Holder, including Trusts and Separate Arrangements for the
benefit of employees of the Unions and members of management, of Series C Voting
Preferred Stock shall have the right to put such holder's Series C Voting
Preferred Stock to the Corporation, in which event the
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Corporation shall be required to elect (the "Put Election") either (a) to
repurchase for either cash equal to the Put Price or shares of Common Stock
having a Trading Price per share on the Put Date equal to the Put Price, each of
such holder's shares of Series C Voting Preferred Stock at the Put Price, or (b)
to permit each such holder to elect either (x) to receive the number of shares
of Common Stock into which such holder's shares of Series C Voting Preferred
Stock are convertible, plus the Excess Amount multiplied by the number of such
holder's shares of Series C Voting Preferred Stock which are so converted, or
(y) to have a number of shares of Common Stock equal to the number of shares of
Common Stock into which such holder's shares of Series C Voting Preferred Stock
are convertible sold on such holder's behalf by the Sales Agent or pursuant to
an underwritten public offering and to receive a cash amount equal to (1) the
Offering Price per share of Common Stock sold plus (2) the Excess Amount
multiplied by the number of such holder's shares of Series C Voting Preferred
Stock which have been so converted.
(ii) The Corporation shall be required to make the Put
Election on or before the sixtieth day prior to the Put Date, to issue a public
announcement of its election no later than the sixtieth day prior to the Put
Date and, if it has made the election set forth in paragraph 9(i)(b), to deliver
promptly to the holders of Series C Voting Preferred Stock an election form for
such holders to make either the election set forth in paragraph 9(i)(b)(x) or
the election set forth in paragraph 9(i)(b)(y) with respect to their shares of
Series C Voting Preferred Stock, which such election may be made with respect to
all or a portion of the Series C Voting Preferred Stock held by such holder.
Such election form shall be returnable to the Trustees by the Put Date.
(iii) Payment by the Corporation to the holders of Series C
Voting Preferred Stock of any cash due to them in respect of their exercise of
the Put Right shall be made on the Put Payment Date. If the Corporation elects
to issue new shares of Common Stock to such holders pursuant to paragraph
9(i)(a), promptly following such election, but not later than the Put Date, the
Corporation shall commence efforts to register such new shares under the
Securities Act of 1933 (the "1933 Act") and shall use its best efforts to cause
such registration to become effective as soon as practicable thereafter.
Delivery of such shares to the holders of Series C Voting Preferred Stock shall
be made seven days after the effective date of such registration or, if later
and the Common Stock is not then Publicly Traded, seven days after delivery to
the Corporation of the investment banker's valuation of the Common Stock in
accordance with the Letter Agreement. Shares of Series C Voting Preferred Stock
with respect to which the Put Right is exercised shall cease to be outstanding
for any purpose and shall be retired upon satisfaction of such Put Right.
(iv) If on the Put Date, the Board of Directors of the
Corporation decides not to repurchase all of the Series C Voting Preferred Stock
with respect to which the Put Right has been exercised either (A) for cash or
for shares of Common Stock pursuant to paragraph 9(i)(a), or (b) pursuant to the
procedures set forth in paragraph 9(i)(b), then on such date and at the end of
each succeeding calendar quarter until all of such Series C Voting Preferred
Stock shall have been repurchased (collectively, "Partial Repurchase Dates"),
the Board of Directors of the Corporation shall use all Available Cash on each
such date to repurchase a portion of the Series C Voting Preferred Stock
entirely for cash (a "Partial Repurchase") in accordance with paragraph 9(i)(a),
but only if and to the extent that the Corporation is not prohibited from making
such repurchase under Delaware law or any loan agreement or other instrument to
which it is a party
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or is subject. Any such partial repurchase shall be made pro rata from among
each holder of Series C Voting Preferred Stock (including the Trusts and
Separate Arrangements) and within each Trust and Separate Arrangement shall be
made among the employees who are beneficiaries of such Trust or Separate
Arrangement in accordance with the terms of such Trust or Separate Arrangement.
(v) The right of a Qualified Holder to put shares of Series C
Voting Preferred to the Corporation as specified herein (the "Put Right") may
only be exercised by a holder of Series C Voting Preferred Stock. The Put Right
shall therefore expire as to any shares of Series C Voting Preferred Stock upon
their conversion into shares of Common Stock prior to exercise of the Put Right.
(10) Definitions. As used herein the following terms shall
have the following definitions:
(i) "Actual Savings" shall mean: (a) for all holders of the
Series C Voting Preferred Stock, other than holders who are members of ALPA, or
trusts or other arrangements for the benefit of members of ALPA, or their
respective transferees who are Qualified Holders, the aggregate amount of (1)
the basic hourly rate of pay in gross dollars which would have been paid, but
for the agreements contained in the Compensation Plan Letters, less the basic
hourly rate of pay in gross dollars which was paid during the Wage Savings
Period, plus (2) the vacation liability which would have been accrued prior to
use but for the agreements contained in the Compensation Plan Letters, other
than the ALPA Compensation Plan Letter, less the vacation rate which has been
accrued prior to use during the Wage Savings Period, in each case for each
employee employed at any time during the Wage Savings Period; and (b) for all
holders of the Series C Voting Preferred Stock who are members of ALPA, or
trusts or other arrangements for the benefit of members of ALPA, or their
respective transferees who are Qualified Holders, the aggregate amount of (1)
the basic hourly rate of pay in gross dollars which would have been paid, but
for the agreements contained in the ALPA Compensation Plan Letters, less the
basic hourly rate of pay in gross dollars which was paid during the Wage Savings
Period, plus (2) $60.250 million, such amount to be allocated monthly pro rata
over the Wage Savings Period.
(ii) "Available Cash" shall mean, on any given date, cash held
by the Corporation and its subsidiaries, or available under existing revolving
credit agreements, which is in excess of all of their then currently anticipated
needs to use such cash for operating and capital requirements, including service
of debt, budgeted capital expenditures and all other obligations, within a
period of one year from such date, taking into account reasonably anticipated
sources of cash during such one-year period, but any of such cash held by a
subsidiary of the Corporation shall be included in the foregoing determination
of Available Cash only if and to the extent that such cash may be made available
to the Corporation pursuant to applicable law or any loan agreements or
instruments to which the Corporation or any of its subsidiaries is a party or is
subject.
(iii) "Corporation Employee" shall mean any person who is the
current or former employee of the Corporation or one of its subsidiaries to whom
Employee Stock is allocated under the Plans or under any Separate Arrangements.
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(iv) "Compensation Plan Letters" shall mean the letter
agreements by and among the Corporation, Northwest and each of the Unions,
entered into July and/or August 1993, providing for the reduction of the basic
hourly rate of pay and vacation accrual of the employees represented by such
Unions.
(v) "Currently Outstanding Common Stock" shall mean (a) the
80,000 shares of the Common Stock held by the Existing Common Stockholders as of
August 1, 1993 and (b) at such time as such shares are issued, the shares of
Common Stock to be issued to holders of the Series A Preferred Stock and Series
B Preferred Stock of the Corporation as contemplated by the Letter Agreements.
(vi) "Employee Stock" shall mean the shares of (i) Series C
Voting Preferred Stock and (following any exercise of the Special Conversion
Option, Common Stock) to be issued pursuant to the Letter Agreements and (ii)
Common Stock issued upon conversion of Series C Voting Preferred Stock, in each
case excluding any shares not held by a Qualified Holder.
(vii) "Excess Amount" shall mean a cash amount per share of
Series C Voting Preferred Stock equal to the excess of (i) the Put Price over
(ii) the Offering Price multiplied by the number of shares of Common Stock into
which one share of Series C Voting Preferred Stock may then be converted upon
the exercise by a holder of the election described in paragraph 9(i)(b)(y).
(viii) "Existing Common Stockholders" shall mean the holders
of the Common Stock as of the date of the Letter Agreements.
(ix) "Letter Agreements" shall mean the Letter Agreements by
and among the Corporation, Northwest and each of the Unions.
(x) "Offering Price" shall mean (a) in the event the Common
Stock is Publicly Traded and holders of less than 10% of the outstanding Series
C Voting Preferred Stock elect to have their shares of Common Stock sold
pursuant to paragraph 9(i)(b)(y), the average of the net prices received by the
Sales Agent for the sale of all such shares in open market transactions at
prevailing market prices during the period from the 10th through the 80th day
following the Put Date (the "Sales Period"); (b) in the event that the Common
Stock is not Publicly Traded and holders of less than 10% of the outstanding
Series C Voting Preferred Stock elect to have their shares of Common Stock sold
pursuant to paragraph 9(i)(b)(y), the value per share determined by an
investment banking firm in accordance with the procedures specified in the last
four sentences of paragraph 10(xviii); and (c) whether or not the Common Stock
is Publicly Traded, in the event that holders of greater than 10% of the then
outstanding Series C Voting Preferred Stock elect to have their shares of Common
Stock publicly sold pursuant to paragraph 9(i)(b)(y), the net price per share
received by such holders for the sale of such shares by means of a single
underwritten public offering, such underwritten public offering to be conducted
by the Corporation during the Sales Period in accordance with the terms of the
Registration Rights Agreement dated as of July 21, 1989, as amended, by and
among the Corporation and the then existing common stock holders of the
Corporation, it being understood that the Corporation shall use its best efforts
to cause such underwritten public offering to take place no later than the 80th
day following the Put
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Date. The Sales Agent, in the event clause (a) of the preceding sentence is
applicable, or the underwriters, in the event clause (c) of the preceding
sentence is applicable, shall be required to (1) obtain the highest practicable
price per share for all shares of Common Stock sold by them, (2) use their best
efforts to obtain a wide distribution of such shares, and (3) refrain from
knowingly selling shares constituting more than 2% of the then outstanding
voting capital stock of the Corporation to (A) any one person, entity or related
group of persons or entities or (B) any person, entity or related group of
persons or entities which, after such sale, would own shares constituting in the
aggregate more than 3% of the then outstanding voting capital stock of the
Corporation.
(xi) "Publicly Traded" shall mean that, with respect to any
class of stock, shares of such class of stock are listed on the New York Stock
Exchange or the American Stock Exchange or quoted on the National Market System
of the National Association of Securities Dealers, Inc. Automated Quotation
System ("NASDAQ"); provided, however, that such stock shall continue to be
deemed to be Publicly Traded notwithstanding any temporary suspension of trading
of not more than five business days on such stock exchange or quotation system
due to general economic or market conditions, limited distribution or trading of
such stock or other factors.
(xii) "Put Date" shall mean August 1, 2003.
(xiii) "Put Payment Date" shall mean the 90th day following
the Put Date or, if later and the provisions of paragraph 10(ix)(c) are
applicable, the closing date for the underwritten public offering referred to in
paragraph 10 (ix)(c).
(xiv) "Put Price" shall mean, with respect to the shares of
Series C Voting Preferred Stock held by, or for the benefit of, the employees of
any Union, or held by, or for the benefit of, the management employees, an
amount in cash equal to (a) the quotient of (x) the Actual Savings realized by
the Corporation pursuant to the Compensation Plan Letters, or with respect to
the management employees, during the Wage Savings Period divided by (y) the
total number of such shares of Series C Voting Preferred Stock to be issued by
the Corporation, without taking into account the conversion of any shares of the
Series C Voting Preferred Stock, plus (b) an amount in cash equal to all accrued
but unpaid dividends per share of such stock.
(xv) "Qualified Holder" shall mean with respect to a share of
Employee Stock any person who (a) is the Corporation Employee to whom such stock
is distributed from the Trusts or pursuant to the Separate Arrangements, (b) is
a trustee or custodian under any Separate Arrangement, a qualified plan
maintained by the Corporation or an individual retirement account of a
Corporation Employee referred to in clause (a) above or such employee's death
beneficiary, (c) is the spouse or child of a Corporation Employee referred to in
clause (a) above, or a trust for the benefit of such spouse or child, to whom
such stock is transferred by such employee, or (d) in the event of the death of
a Corporation Employee referred to in clause (a) above, is an heir, executor,
administrator, testamentary trustee or legatee of such employee by operation of
such employee's will or the laws of intestacy.
(xvi) "Sales Agent" shall mean a member firm of the New York
Stock Exchange to be selected by the Corporation to conduct sales of Common
Stock on behalf of
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holders of Series C Voting Preferred Stock in accordance with the procedures set
forth in paragraph 10(ix)(a).
(xvii) "Series C Directors" shall mean the directors of the
Corporation elected by the holders of the Series C Voting Preferred Stock
pursuant to paragraph 7(ii).
(xviii) "Trading Price" shall mean for any date the average of
the daily closing prices of the Common Stock (1) for purposes of paragraph 9(i),
during the 30 calendar days beginning on the Put Date and (2) for all other
purposes, during the 30 calendar days ending on such date. The closing price for
each day shall be the reported last sales price, regular way, or, in case no
sale takes place on such day, the average of the reported closing bid and asked
prices, regular way, in either case as reported on the New York Stock Exchange
Composite Tape or, if the Common Stock is not listed or admitted to trading on
the New York Stock Exchange at such time, on the principal national securities
exchange on which the Common Stock is listed or admitted to trading or, if not
listed or admitted to trading on any national securities exchange, on NASDAQ. In
the event the Common Stock is not Publicly Traded, the Series C Directors shall
select a nationally recognized investment banking firm from a list of five such
firms to be provided by the chief executive officer of the Corporation on the
Put Date, to value such stock. Any fees and expenses associated with such
valuation shall be borne by the Corporation. Such firm shall deliver such
valuation to the Corporation within 60 days after it has been retained, and the
value per share so determined by such firm shall constitute the Trading Price
for purposes hereof. For purposes of its valuation in connection with clause (a)
or (b) of paragraph 9(i), such firm shall assume that the shares of Common Stock
to be issued pursuant to clauses (a) or (b) of paragraph 9(i) have been fully
distributed.
(xix) "Unions" shall mean ALPA, the International Brotherhood
of Teamsters (the "IBT"), the International Association of Machinists and
Aerospace Workers (the "IAM"), the Transport Workers Union of America ("TWU"),
the Airline Technical Support Association ("ATSA") and the Northwest Airlines
Meteorologists Association ("NAMA") (individually, each a "Union").
(xx) "Wage Savings Date" shall mean August 1, 1993.
(xxi) "Wage Savings Period" shall mean with respect to those
shares held by, or for the benefit of, (a) members of the IAM, the 38-month
period commencing on the Wage Savings Date, (b) members of ATSA, the 40-month
period commencing on the Wage Savings Date, and (c) members of each other Union
and the management employees, the 36-month period commencing on the Wage Savings
Date.
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EXHIBIT D
CERTIFICATE OF DESIGNATIONS
OF
SERIES D JUNIOR PARTICIPATING PREFERRED STOCK
OF
NEWBRIDGE PARENT CORPORATION
(which shall be renamed Northwest Airlines Corporation)
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
-------------------
Newbridge Parent Corporation, a corporation organized and
existing under the General Corporation Law of the State of Delaware (hereinafter
called the "Company"), hereby certifies that the following resolution was duly
adopted by the Board of Directors of the Company as required by Section 151 of
the General Corporation Law of the State of Delaware by written consent in lieu
of a meeting on November 20, 1998:
RESOLVED, that pursuant to the authority granted to and vested
in the Board of Directors of the Company (hereinafter called the "Board of
Directors" or the "Board") in accordance with the provisions of the Company's
Certificate of Incorporation, as amended to date (hereinafter called the
"Certificate of Incorporation"), the Board of Directors hereby creates a series
of Preferred Stock, par value $.01 per share (the "Preferred Stock"), of the
Company and hereby states the designation and number of shares, and fixes the
relative rights, powers and preferences thereof, and the limitations thereof, as
follows:
Section 1. Designation and Amount. The shares of such series
shall be designated as "Series D Junior Participating Preferred Stock" (the
"Series D Preferred Stock") and the number of shares constituting the Series D
Preferred Stock shall be 3,000,000. Such number of shares may be increased or
decreased by resolution of the Board of Directors; provided, that no decrease
shall reduce the number of shares of Series D Preferred Stock to a number less
than the number of shares then outstanding plus the number of shares reserved
for issuance upon the exercise of outstanding options, rights or warrants or
upon the conversion of any outstanding securities issued by the Company
convertible into Series D Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock of the Company (the "Preferred Stock") (or any similar
stock) ranking prior and superior to the Series D Preferred Stock with respect
to dividends, the holders of shares of Series D
<PAGE>
Preferred Stock, in preference to the holders of Common Stock, par value $.01
per share of the Company (the "Common Shares") and of any other stock of the
Company ranking junior to the Series D Preferred Stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on the last day
of January, April, July, and October in each year (each such date being referred
to herein as a "Dividend Payment Date"), commencing on the first Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series D Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions other than a dividend payable in
Common Shares, declared on the Common Shares since the immediately preceding
Dividend Payment Date or, with respect to the first Dividend Payment Date, since
the first issuance of any share or fraction of a share of Series D Preferred
Stock. In the event the Company shall at any time after November 20, 1998,
declare or pay any dividend on the Common Shares payable in Common Shares, or
effect a subdivision or combination or consolidation of the outstanding Common
Shares (by reclassification or otherwise than by payment of a dividend in Common
Shares) into a greater or lesser number of Common Shares, then in each such case
the amount to which holders of shares of Series D Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence shall
be adjusted by multiplying such amount by a fraction, the numerator of which is
the number of Common Shares outstanding immediately after such event and the
denominator of which is the number of Common Shares that were outstanding
immediately prior to such event.
(B) The Company shall declare a dividend or distribution on
the Series D Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common Shares
(other than a dividend payable in shares of Common Shares); provided that, in
the event no dividend or distribution shall have been declared on the Common
Shares during the period between any Dividend Payment Date and the next
subsequent Dividend Payment Date, a dividend of $1 per share on the Series D
Preferred Stock shall nevertheless be payable, when, as and if declared, on such
subsequent Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative, whether
or not earned or declared, on outstanding shares of Series D Preferred Stock
from the Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for the
first Dividend Payment Date, in which case dividends on such shares shall begin
to accrue from the date of issue of such shares, or unless the date of issue is
a Dividend Payment Date or is a date after the record date for the determination
of holders of shares of Series D Preferred Stock entitled to receive a quarterly
dividend and before such Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Dividend Payment
Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on
the shares of Series D Preferred Stock in an amount less than the total amount
of such dividends at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the determination
of holders of shares of Series D Preferred Stock entitled to receive payment of
a dividend or distribution declared thereon, which record date shall be not more
than 60 days prior to the date fixed for the payment thereof.
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Section 3. Voting Rights. The holders of shares of Series D
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth and except as otherwise provided in the Certificate of
Incorporation or required by law, each share of Series D Preferred
Stock shall entitle the holder thereof to 100 votes on all matters upon
which the holders of the Common Shares of the Company are entitled to
vote. In the event the Company shall at any time after November 20,
1998, declare or pay any dividend on the Common Shares payable in
Common Shares, or effect a subdivision or combination or consolidation
of the outstanding Common Shares (by reclassification or otherwise than
by payment of a dividend in Common Shares) into a greater or lesser
number of Common Shares, then in each such case the number of votes per
share to which holders of shares of Series D Preferred Stock were
entitled immediately prior to such event shall be adjusted by
multiplying such number by a fraction, the numerator of which is the
number of Common Shares outstanding immediately after such event and
the denominator of which is the number of Common Shares that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in the Certificate of
Incorporation or in any other Certificate of Designations creating a
series of Preferred Stock or any similar stock, and except as otherwise
required by law, the holders of shares of Series D Preferred Stock and
the holders of Common Shares and any other capital stock of the Company
having general voting rights shall vote together as one class on all
matters submitted to a vote of stockholders of the Company.
(C) Except as set forth herein, or as otherwise provided by
law, holders of Series D Preferred Stock shall have no special voting
rights and their consent shall not be required (except to the extent
they are entitled to vote with holders of Common Shares as set forth
herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series D Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not earned or declared, on
shares of Series D Preferred Stock outstanding shall have been paid in
full, the Company shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (as to
dividends) to the Series D Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (as
to dividends) with the Series D Preferred Stock, except
dividends paid ratably on the Series D Preferred Stock and all
such parity stock on which dividends are payable or in arrears
in proportion to the total amounts to which the holders of all
such shares are then entitled;
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(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to
the Series D Preferred Stock, provided that the Company may at
any time redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock of the
Company ranking junior (as to dividends and upon dissolution,
liquidation or winding up) to the Series D Preferred Stock or
rights, warrants or options to acquire such junior stock;
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series D Preferred Stock, or any
shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series D
Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board
of Directors) to all holders of such shares upon such terms as
the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and
preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable
treatment among the respective series or classes.
(B) The Company shall not permit any subsidiary of the Company
to purchase or otherwise acquire for consideration any shares of stock
of the Company unless the Company could, under paragraph (A) of this
Section 4, purchase or otherwise acquire such shares at such time and
in such manner.
Section 5. Reacquired Shares. Any shares of Series D Preferred
Stock purchased or otherwise acquired by the Company in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Company, no distribution shall be
made (A) to the holders of the Common Shares or of shares of any other stock of
the Company ranking junior, upon liquidation, dissolution or winding up, to the
Series D Preferred Stock unless, prior thereto, the holders of shares of Series
D Preferred Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not earned or
declared, to the date of such payment, provided that the holders of shares of
Series D Preferred Stock shall be entitled to receive an aggregate amount per
share, subject to the provision for adjustment hereinafter set forth, equal to
100 times the aggregate amount to be distributed per share to holders of Common
Shares, or (B) to the holders of shares of stock ranking on a parity upon
liquidation, dissolution or winding up with the Series D Preferred Stock, except
distributions made ratably on the Series D Preferred Stock and all such parity
stock in proportion to the total amounts to which the holders of all such shares
are entitled upon such liquidation, dissolution or winding up. In the event the
Company shall at any time after November 20, 1998 declare or pay any dividend on
the Common Shares payable in Common Shares, or effect a subdivision or
combination or consolidation of the outstanding Common Shares (by
reclassification or otherwise than by payment of a dividend in Common Shares)
into a greater or lesser number of Common Shares, then in each such case the
aggregate amount to which holders of shares of Series D Preferred Stock were
entitled immediately prior to such event under the proviso in clause (A) of the
preceding sentence shall be adjusted by multiplying such amount by a fraction
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the numerator of which is the number of Common Shares outstanding immediately
after such event and the denominator of which is the number of Common Shares
that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Company
shall enter into any consolidation, merger, combination or other transaction in
which the Common Shares are converted into, exchanged for or changed into other
stock or securities, cash and/or any other property, then in any such case each
share of Series D Preferred Stock shall at the same time be similarly converted
into, exchanged for or changed into an amount per share (subject to the
provision for adjustment hereinafter set forth) equal to 100 times the aggregate
amount of stock, securities, cash and/or any other property (payable in kind),
as the case may be, into which or for which each Common Share is converted,
exchanged or converted. In the event the Company shall at any time after
November 20, 1998 declare or pay any dividend on the Common Shares payable in
Common Shares, or effect a subdivision or combination or consolidation of the
outstanding Common Shares (by reclassification or otherwise than by payment of a
dividend in Common Shares) into a greater or lesser number of Common Shares,
then in each such case the amount set forth in the preceding sentence with
respect to the conversion, exchange or change of shares of Series D Preferred
Stock shall be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of Common Shares outstanding immediately after such event
and the denominator of which is the number of Common Shares that were
outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series D Preferred
Stock shall not be redeemable from any holder.
Section 9. Rank. The Series D Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of assets upon
liquidation, dissolution or winding up of the Company, junior to all other
series of Preferred Stock and senior to the Common Shares.
Section 10. Amendment. If any proposed amendment to the
Certificate of Incorporation (including this Certificate of Designations) would
alter, change or repeal any of the preferences, powers or special rights given
to the Series D Preferred Stock so as to affect the Series D Preferred Stock
adversely, then the holders of the Series D Preferred Stock shall be entitled to
vote separately as a class upon such amendment, and the affirmative vote of
two-thirds of the outstanding shares of the Series D Preferred Stock, voting
separately as a class, shall be necessary for the adoption thereof, in addition
to such other vote as may be required by the General Corporation Law of the
State of Delaware.
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Exhibit 4.2
RESTATED BYLAWS OF
NEWBRIDGE PARENT CORPORATION
(hereinafter called the "Corporation")
ARTICLE I
OFFICES
-------
Section 1. Registered Office. The registered office of the
office of the Corporation shall be in Wilmington, New Castle County, State of
Delaware.
Section 2. Other Offices. The Corporation may also have
offices at such other places both within and without the State of Delaware as
the Board of Directors may from time to time determine.
ARTICLE II
MEETING OF STOCKHOLDERS
-----------------------
Section 1. Place of Meetings. Meetings of the stockholders for
the election of directors or for any other purpose shall be held at such time
and place, either within or without the State of Delaware, as shall be
designated from time to time by the Board of Directors and stated in the notice
of the meeting or in a duly executed waiver of notice thereof.
Section 2. Annual Meetings. The Annual Meeting of Stockholders
shall be held on such date and at such time as shall be designated from time to
time by the Board of Directors and stated in the notice of the meeting, at which
meeting the stockholders shall elect by a plurality vote a Board of Directors,
and transact such other business as may properly be brought before the meeting.
Section 3. Special Meetings. Special Meetings of Stockholders,
for any purpose or purposes, may be called only by the Chairman of the Board,
and shall be called by the Chairman of the Board at the request in writing of a
majority of the Board of Directors. Such request shall state the purpose or
purposes of the proposed meeting.
Section 4. Notice of Meetings. Written notice of an Annual
Meeting or Special Meeting stating the place, date and hour of the meeting and
in the case of a Special Meeting, the purpose or purposes for which the meeting
is called, shall be given not less than ten nor more
<PAGE>
than sixty days before the date of the meeting to each stockholder entitled to
vote at such meeting.
Section 5. Quorum. Except as otherwise provided by law or by
the Certificate of Incorporation, the holders of a majority of the capital stock
issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business. If, however, such quorum shall not
be present or represented at any meeting of the stockholders, the stockholders
entitled to vote thereat, present in person or represented by proxy, shall have
power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present or represented. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally noticed. If the adjournment is for more than thirty days, or if after
the adjournment a new record date is fixed for the adjourned meeting, a notice
of the adjourned meeting shall be given to each stockholder entitled to vote at
the meeting.
Section 6. Voting. Except as otherwise provided by the
Certificate of Incorporation or these Bylaws, any questions brought before any
meeting of stockholders shall be decided by a majority vote of the number of
shares present in person or represented by proxy and entitled to vote on the
subject matter. Such votes may be cast in person or by proxy but no proxy shall
be voted on after three years from its date, unless such proxy provides for a
longer period. The Board of Directors, in its discretion, or the officer of the
Corporation presiding at a meeting of stockholders, in his discretion, may
require that any votes cast at such meeting shall be cast by written ballot.
Section 7. Special Voting Requirements. Notwithstanding
anything in Section 6 above, any plan of merger or consolidation with or into
another person or entity in one or a series of related transactions that is not
approved by the Board of Directors in accordance with the provisions of these
Bylaws and which is brought before any meeting of stockholders shall require the
vote of not less than two-thirds of the shares of stock entitled to vote
thereon. Any amendment to this Section 7 of Article II of these Bylaws shall
require the approval of not less than two-thirds of the shares of stock entitled
to vote thereon or a two-thirds vote of the Board of Directors.
Section 8. List of Stockholders Entitled to Vote. The officer
of the Corporation who has charge of the stock ledger of the Corporation shall
prepare and make, at least ten days before every meeting of stockholders, a
complete list of the stockholders entitled to vote at the 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 the meeting,
during ordinary business hours, for a period of at least ten days prior to the
meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall also be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder of the Corporation who is
present.
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Section 9. Stockholder Ledger. Except as otherwise provided in
the Certificate of Incorporation or in Article IX of these Bylaws, the stock
ledger of the Corporation shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list required by Section
8 of this Article II or the books of the Corporation, or to vote in person or by
proxy at any meeting of stockholders.
ARTICLE III
DIRECTORS
---------
Section 1. Number and Election of Directors. (a) The Board of
Directors shall consist of 15 members. Except as provided in Sections 1 and 2 of
this Article, directors shall be elected by a plurality of the votes cast at
Annual Meetings of Stockholders, and each director so elected shall hold office
until the next Annual Meeting and until his successor is duly elected and
qualified, or until his earlier resignation or removal.
(b) Notwithstanding anything in this Section 1 or in Section 2
of this Article III to the contrary, each of the holders of the series C
preferred stock, par value $0.01 per share (the "Series C Preferred Stock"), of
the Corporation may vote to elect directors to the Board of Directors, and to
fill vacancies on the Board of Directors, in accordance with the terms of the
certificate of designation for such stock; provided, however, that each director
elected by holders of the Series C Preferred Stock (a "Series C Director") must
be a citizen of the United States.
(c) Subject to the exclusive rights of holders of any class or
series of stock having a preference over the Common Stock as to dividends or
upon liquidation to elect Series C Directors or directors of the Corporation
upon the happening of certain events (including as referred to in Section 1(b)),
nominations of candidates for election as directors of the Corporation at any
meeting of stockholders of the Corporation may be made by the Chairman of the
Board of Directors or by any stockholder entitled to vote at such meeting who
complies with the provisions of this Section 1(c). Not less than 60 days prior
to the date of the anniversary of the annual meeting held in the prior year, in
the case of an annual meeting, or, in the case of a special meeting called by
the Chairman of the Board for the purpose of electing directors, not more than
10 days following the earlier of the date of notice of such special meeting or
the date on which a public announcement of such meeting is made, any stockholder
who intends to make a nomination at the meeting shall deliver written notice to
the Secretary of the Corporation setting forth (i) the name and address of the
stockholder who intends to make the nomination and of the person or persons to
be nominated; (ii) a representation that the stockholder (A) is a United States
Citizen (as such term is defined in the Certificate of Incorporation), (B) is a
holder of record of stock of the Corporation specified in such notice, (C) is or
will be entitled to vote at such meeting, and (D) intends to appear in person or
by proxy at the meeting to nominate the person or persons specified in the
notice; (iii) a statement that the nominee (or nominees) is a United States
Citizen (as defined above) and is willing to be nominated; and (iv) such other
information concerning each such nominee as would be required under the rules of
the Securities and Exchange Commission in a proxy statement soliciting proxies
for the election of such nominee and in a Schedule 14B (or other comparable
required filing then in effect) under the
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Securities Exchange Act of 1934. In the event that a person is validly
designated as a proposed nominee in accordance with this Section l(c) (including
a bona fide statement that the nominee is willing to be nominated) and shall
thereafter become unable or unwilling to stand for election to the Board of
Directors, the stockholder who made such designation may designate promptly in
the manner set forth above a substitute proposed nominee, notwithstanding the
minimum time period set forth in this Section 1(c). No person may be elected as
a director at a meeting of stockholders unless nominated in accordance with this
Section l(c), and any purported nomination or purported election not made in
accordance with the procedures as set forth in this Section 1(c) shall be void.
In addition to any other requirements relating to amendments to these Bylaws, no
proposal by any stockholder to repeal or amend this Section l(c) shall be
brought before any meeting of the stockholders of the Corporation unless written
notice is given of (i) such proposed repeal or the substance of such proposed
amendment; (ii) the name and address of the stockholder who intends to propose
such repeal or amendment; and (iii) a representation that the stockholder is a
holder of record of stock of the Corporation specified in such notice, is or
will be entitled to vote at such meeting and intends to appear in person or by
proxy at the meeting to make the proposal. Such notice shall be given in the
manner and at the time specified above in this Section 1(c). Any proposal to
repeal or amend or any such purported repeal or purported amendment of this
Section 1(c) not made or adopted in accordance with the procedures set forth in
this Section 1(c) shall be void. Any amendment to this Section l(c) shall
require the vote of holders of not less than two-thirds of the shares of stock
entitled to vote thereon.
Section 2. Vacancies. Vacancies and newly created
directorships resulting from any increase in the authorized number of directors
shall be filled by a majority vote of all directors, including the Series C
Directors, as defined in Section 1 of this Article III, or by a sole remaining
director, and the directors so chosen shall hold office until the next annual
election and until their successors are duly elected and qualified, or until
their earlier resignation or removal; provided, however, that:
(a) Any interim vacancy among the Series C Directors, whether
such vacancy occurs as a result of death, removal or otherwise, shall
be filled, effective at the beginning of the next meeting of the Board
of Directors, by a designee nominated by the Union, as defined in the
Certificate of Designation for the Series C Preferred Stock (the
"Series C Certificate of Designation"), that nominated the previous
holder of the vacant position pursuant to the terms of the Letter
Agreements (as defined below); provided, however, that for any vacancy
among the Series C Directors created by an increase in the size of the
Board of Directors pursuant to the provisions of paragraph 7(ii)(a) or
7(ii)(b) of the Series C Certificate of Designation, the Air Line
Pilots Association, the International Brotherhood of Teamsters and the
International Association of Machinists and Aerospace Workers, each
acting through its President or, in the case of Airline Pilots
Association, the Northwest Airlines, Inc. Master Executive Council,
shall each be entitled to nominate one-third of the Series C Directors
and if the total number of Series C Directors is not a multiple of
three, any remaining Series C Directors shall be nominated by a
unanimous vote of the existing Series C Directors designated by such
three Unions.
(b) In the event that, in connection with the redemption of
Series C Preferred Stock pursuant to paragraph 9(i)(a) of the Series C
Certificate of Designation, the
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Corporation issues additional shares of Common Stock to the exchanging
holders of Series C Preferred Stock and, following such issuance, the
number of shares of Common Stock held by Qualified Holders of Employee
Stock, as such terms are defined in the Series C Certificate of
Designation, after such redemption is greater than 50% of the number of
shares of voting capital stock of the Corporation then outstanding, the
terms of all sitting members of the Board of Directors of the
Corporation, other than the Series C Directors, shall thereupon
terminate and the Series C Directors shall appoint the successors of
such directors. Any director may resign at any time upon notice to the
Corporation. Directors need not be stockholders.
Section 3. Committees. The Board of Directors may designate
one or more committees, which committees shall, to the extent provided in the
resolution of the Board of Directors establishing such a committee, have all
authority and may exercise all the powers of the Board of Directors in the
management of the business and affairs of the Corporation to the extent lawful
under the General Corporation Law of the State of Delaware, provided, however,
to the extent that directors serve as members of a committee designated by the
Board of Directors, at least one of such directors shall be a Series C Director
as long as any Series C Directors sit on the Board of Directors.
Section 4. Duties and Powers. The business of the Corporation
shall be managed by or under the direction of the Board of Directors which may
exercise all such powers of the Corporation and do all such lawful acts and
things as are not by statute or by the Certificate of Incorporation or by these
Bylaws directed or required to be exercised or done by the stockholders.
Section 5. Meetings. The Board of Directors of the Corporation
may hold meetings, both regular and special, either within or without the State
of Delaware. Regular meetings of the Board of Directors may be held without
notice at such time and at such place as may from time to time be determined by
the Board of Directors. Special meetings of the Board of Directors may be called
by the Chairman, if there be one, the President, or any two directors. Notice
thereof stating the place, date and hour of the meeting shall be given to each
director either by mail not less than forty-eight (48) hours before the date of
the meeting, by telephone or telegram on twenty-four (24) hours' notice, or on
such shorter notice as the person or persons calling such meeting may deem
necessary or appropriate in the circumstances.
Section 6. Quorum; Board Action. (a) Except as may be
otherwise specifically provided by law, the Certificate of Incorporation or
these Bylaws, at all meetings of the Board of Directors, a majority of the
entire Board of Directors shall constitute a quorum for the transaction of
business and the act of a majority of the entire Board of Directors shall be the
act of the Board of Directors. If a quorum shall not be present at any meeting
of the Board of Directors, the directors present thereat may adjourn the meeting
from time to time, without notice other than announcement at the meeting, until
a quorum shall be present.
(b) [Deleted]
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(c) Notwithstanding anything in Section 6(a) to the contrary,
the Corporation's Certificate of Incorporation or these Bylaws may not be
amended to abrogate any of the terms or rights or powers of the Series C
Preferred Stock in a manner inconsistent with the terms of the Letter
Agreements, or the Common Stock into which such Series C Preferred Stock may be
converted, without the affirmative vote of a majority of the Series C Directors.
(d) The following term shall have the following meaning for
the purpose of this Article III:
"Letter Agreements" shall mean the equity letter agreements entered
into in 1993 between the Corporation and Northwest on the one hand and
the Air Line Pilots Association, the International Brotherhood of
Teamsters, the International Association of Machinists and Aerospace
Workers, the Transport Workers Union of America, the Airline Technical
Support Association and the Northwest Airlines
Meteorologists Association on the other hand.
Section 7. Actions of Board. Unless otherwise provided by the
Certificate of Incorporation or these Bylaws, any action required or permitted
to be taken at any meeting of the Board of Directors or of any committee thereof
may be taken without a meeting, if all the members of the Board of Directors or
committee, as the case may be, consent thereto in writing, and the writing or
writings are filed with the minutes of proceedings of the Board of Directors or
committee.
Section 8. Meetings by Means of Conference Telephone. Members
of the Board of Directors of the Corporation, or any committee designated by the
Board of Directors, may participate in a meeting of the Board of Directors or
such committee by means of a conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in a meeting pursuant to this Section 8 shall
constitute presence in person at such meeting.
Section 9. Compensation. The directors may be paid their
expenses, if any, of attendance at each meeting of the Board of Directors and
may be paid a fixed sum for attendance at each meeting of the Board of Directors
or a stated salary as director or both. No such payment shall preclude any
director from serving the Corporation in any other capacity and receiving
compensation therefor. Members of special or standing committees may be allowed
like compensation for attending committee meetings.
ARTICLE IV
OFFICERS
Section 1. General. The officers of the Corporation shall be
chosen by the Board of Directors and shall be a President, a Secretary and a
Treasurer. The Board of Directors, in its discretion, may also choose a Chairman
of the Board of Directors (who must be a director) and one or more Vice
Presidents, Assistant Secretaries, Assistant Treasurers and other officers. Any
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<PAGE>
number of offices may be held by the same person. The officers of Corporation
need not be stockholders of the Corporation nor, except in the case of the
Chairman of the Board of Directors, need such officers be directors of the
Corporation.
Section 2. Election. The Board of Directors at its first
meeting held after each Annual Meeting of Stockholders shall elect the officers
of the Corporation who shall hold their offices for such terms and shall
exercise such powers and perform such duties as shall be determined from time to
time by the Board of Directors; and all officers of the Corporation shall hold
office until their successors are chosen and qualified, or until their earlier
resignation or removal. Any officer may be removed at any time by the Board of
Directors. Any vacancy occurring in any office of the Corporation shall be
filled by the Board of Directors. The salaries of all officers of the
Corporation shall be fixed by the Board of Directors.
Section 3. Voting Securities Owned by the Corporation.
Notwithstanding anything to the contrary contained herein, powers of attorney,
proxies, waivers of notice of meeting, consents and other instruments relating
to securities owned by the Corporation may be executed in the name of and on
behalf of and such securities, if voting securities, may be voted on behalf of,
the Corporation (i) by such officer or officers as are specifically delegated to
do so in any particular instance by the Board of Directors of the Corporation
and (ii) the President or any Vice President, in any other case, and any such
officer may, in the name of and on behalf of the Corporation, take all such
action as such officer may deem advisable to vote such securities in person or
by proxy at any meeting of security holders of any corporation in which the
Corporation may own securities and at any such meeting shall possess and may
exercise any and all rights and power incident to the ownership of such
securities and which, as the owner thereof, the Corporation might have exercised
and possessed if present. The Board of Directors may, by resolution, from time
to time confer like powers upon any other person or persons.
Section 4. Chairman of the Board of Directors. The Chairman of
the Board of Directors, if there be one, shall preside at all meetings of the
stockholders and of the Board of Directors. He or she shall be the Chief
Executive Officer of the Corporation, and except where by law the signature of
the President is required, the Chairman of the Board of Directors shall possess
the same power as the President to sign all contracts, certificates and other
instruments of the Corporation which may be authorized by the Board of
Directors. During the absence or disability of the President, the Chairman of
the Board of Directors shall exercise all the powers and discharge all the
duties of the President. The Chairman of the Board of Directors shall also
perform such other duties and may exercise such other powers as from time to
time may be assigned to him or her by these Bylaws or by the Board of Directors.
Section 5. President. The President shall be subject to the
control of the Board of Directors and, if there be one, the Chairman of the
Board of Directors. He or she shall execute all bonds, mortgages, contracts and
other instruments of the Corporation requiring a seal, under the seal of the
Corporation, except where required or permitted by law to be otherwise signed
and executed and except that the other officers of the Corporation may sign and
execute documents when so authorized by these Bylaws, the Board of Directors,
the President or, if there be one, the Chairman of the Board of Directors. In
the absence of disability of the Chairman of the Board of Directors, or if there
be none, the President shall preside at all meetings of the stockholders and
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the Board of Directors. If there be no Chairman of the Board of Directors, the
President shall be the Chief Executive Officer of the Corporation. The President
shall also perform such other duties and may exercise such other powers as from
time to time may be assigned to him or her by these Bylaws or by the Board of
Directors.
Section 6. Vice Presidents. At the request of the President or
in his or her absence or in the event of his or her inability or refusal to act
(and if there be no Chairman of the Board of Directors), the Vice President or
the Vice Presidents if there is more than one (in the order designated by the
Board of Directors) shall perform the duties of the Chief Executive Officer of
the Corporation, and when so acting, shall have all the powers of and be subject
to all the restrictions upon the President. Each Vice President shall perform
such other duties and have such other powers as the Board of Directors from time
to time may prescribe. If there be no Chairman of the Board of Directors and no
Vice President, the Board of Directors shall designate the officer of the
Corporation who, in the absence of the President or in the event of the
inability or refusal of the President to act, shall perform the duties of the
Chief Executive Officer of the Corporation, and when so acting, shall have all
the powers of and be subject to all the restrictions upon such Chief Executive
Officer.
Section 7. Secretary. The Secretary shall attend all meetings
of the Board of Directors and all meetings of stockholders and record all the
proceedings thereat in a book or books to be kept for that purpose; the
Secretary shall also perform like duties for the standing committees when
required. The Secretary shall give, or cause to be given, notice of all meetings
of the stockholders and special meetings of the Board of Directors, and shall
perform such other duties as may be prescribed by the Board of Directors or the
Chief Executive Officer of the Corporation, under whose supervision he or she
shall be. If the Secretary shall be unable or shall refuse to cause to be given
notice of all meetings of the stockholders and special meetings of the Board of
Directors, and if there be no Assistant Secretary, then either the Board of
Directors or the Chief Executive Officer of the Corporation may choose another
officer to cause such notice to be given. The Secretary shall have custody of
the seal of the Corporation and the Secretary or any Assistant Secretary, if
there be one, shall have authority to affix the same to any instrument requiring
it and when so affixed, it may be attested by the signature of the Secretary or
by the signature of any such Assistant Secretary. The Board of Directors may
give general authority to any other officer to affix the seal of the Corporation
and to attest the affixing by his signature. The Secretary shall see that all
books, reports, statements, certificates and other documents and records
required by law to be kept or filed are properly kept or filed, as the case may
be.
Section 8. Treasurer. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Corporation and shall
deposit all moneys and other valuable effects in the name and to the credit of
the Corporation in such depositories as may be designated by the Board of
Directors. The Treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the Chief Executive Officer of the
Corporation and the Board of Directors, at its regular meetings, or when the
Board of Directors so requires, an account of all his or her transactions as
Treasurer and of the financial condition of the Corporation. If required by the
Board of Directors, the Treasurer shall give the Corporation a bond in such sum
and with such surety or sureties as shall be
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satisfactory to the Board of Directors for the faithful performance of the
duties of his or her office 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
possession or under his or her control belonging to the Corporation.
Section 9. Assistant Secretaries. Except as may be otherwise
provided in these Bylaws, Assistant Secretaries, if there be any, shall perform
such duties and have such powers as from time to time may be assigned to them by
the Board of . Directors, the Chairman of the Board of Directors, the President,
any Vice President, if there be one, or the Secretary, and in the absence of the
Secretary or in the event of his disability or refusal to act, shall perform the
duties of the Secretary, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the Secretary.
Section 10. Assistant Treasurers. Assistant Treasurers, if
there be any, shall perform such duties and have such powers as from time to
time may be assigned to them by the Board of Directors, the Chairman of the
Board of Directors, the President, any Vice President, if there be one, or the
Treasurer, and in the absence of the Treasurer or in the event of his or her
disability or refusal to act, shall perform the duties of the Treasurer, and
when so acting, shall have all the powers of and be subject to all the
restrictions upon the Treasurer. If required by the Board of Directors, an
Assistant Treasurer shall give the Corporation a bond in such sum and with such
surety or sureties as shall be satisfactory to the Board of Directors for the
faithful performance of the duties of his or her office 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 possession or under his or her control belonging to the
Corporation.
Section 11. Other Officers. Such other officers as the Board
of Directors may choose shall perform such duties and have such powers as from
time to time may be assigned to them by the Board of Directors. The Board of
Directors may delegate to any other officer of the Corporation the power to
choose such other officers and to prescribe their respective duties and powers.
ARTICLE V
STOCK
-----
Section 1. Form of Certificates. Every holder of stock in the
Corporation shall be entitled to have a certificate signed, in the name of the
Corporation (i) by the Chairman of the Board of Directors, the President or a
Vice President and (ii) by the Treasurer or an Assistant Treasurer, or the
Secretary or an Assistant Secretary of the Corporation, certifying the number of
shares owned by him or her in the Corporation.
Section 2. Signatures. Where a certificate is countersigned by
(i) a transfer agent other than the Corporation or its employee, or (ii) a
register other than the Corporation or its employee, any other signature on the
certificate may be a facsimile. In case any officer, transfer
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agent or registrar who has signed or whose facsimile signature has been placed
upon a certificate shall have ceased to be such officer, transfer agent or
registrar before such certificate is issued, it may be issued by the Corporation
with the same effect as if he or she were such officer, transfer agent or
registrar at the date of issue.
Section 3. Lost Certificates. The Board of Directors may
direct a new certificate to be issued in place of any certificate theretofore
issued by the Corporation alleged to have been lost, stolen or destroyed, upon
the making of an affidavit of that fact by the person claiming the certificate
of stock to be lost, stolen or destroyed. When authorizing such issue of a new
certificate, the Board of Directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, stolen or
destroyed certificate, or his or her legal representative, to advertise the same
in such manner as the Board of Directors 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 certificate alleged
to have been lost, stolen and destroyed.
Section 4. Transfers. Stock of the Corporation shall be
transferable in the manner prescribed by law and in these Bylaws. Transfers to
stock shall be made on the books of the Corporation only by the person named in
the certificate or by his or her attorney lawfully constituted in writing and
upon the surrender of the certificate therefor, which shall be canceled before a
new certificate shall be issued.
Section 5. Record Date. 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, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock,
or for the purpose of any other lawful action, the Board of Directors may fix,
in advance, a record date, which shall not be more than sixty days nor less than
ten days before the date of such meeting, nor more than sixty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
Section 6. Beneficial owners. The Corporation shall be
entitled to recognize the exclusive right of a person registered on its books as
the owner of shares to receive dividends and to vote as such owner, and to hold
liable for calls and assessments a person registered on its books as the owner
of shares, and shall not be bound to recognize any equitable or other claim to
or interest in such share or shares on the part of any other person, whether or
not it shall have express or other notice thereof, except as otherwise provided
by law.
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ARTICLE VI
NOTICES
Section 1. Notices. Whenever written notice is required by
law, the Certificate of Incorporation or these Bylaws, to be given to any
director, member of a committee or stockholder, such notice may be given by
mail, addressed to such director, member of a committee or stockholder, at his
address as it appears on the records of the Corporation, with postage thereon
prepaid, and such notice shall be deemed to be given at the time when the same
shall be deposited in the United States mail. Written notice may also be given
personally or by telegram, telex, cable or telecopy (facsimile).
Section 2. Waivers of Notice. Whenever any notice is required
by law, the Certificate of Incorporation or these Bylaws, to be given to any
director, member of a committee or stockholder, a waiver thereof in writing,
signed by the person entitled to notice, whether before or after the time stated
therein, shall be deemed equivalent to notice. Attendance of a person at a
meeting shall constitute a waiver of notice of such meeting, except when the
person attends a meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting or the stockholders, directors, or
members of a committee of directors need be specified in any written notice
unless so required by the Certificate of Incorporation or these Bylaws.
ARTICLE VII
GENERAL PROVISIONS
------------------
Section 1. Dividends. Dividends upon the capital stock of the
Corporation, subject to the provisions of the Certificate of Incorporation, may
be declared by the Board of Directors at any regular or special meeting, and may
be paid in cash, in property or in shares of the capital stock. Before payment
of any dividend, there may be set aside out of any funds of the Corporation
available for dividends such sum or sums as the Board of Directors from time to
time, in its absolute discretion, deems proper as a reserve or reserves to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the Corporation, or for any proper purpose, and the Board of
Directors may modify or abolish any such reserve.
Section 2. Disbursements. All checks or demands for money and
notes of the Corporation shall be signed by the Treasurer or such officer or
officers or such other person or persons as the Board of Directors may from time
to time designate.
Section 3. Fiscal Year. The fiscal year of the Corporation
shall be fixed by resolution of the Board of Directors.
Section 4. Corporate Seal. The corporate seal shall have
inscribed thereon the name of the Corporation, the year of its organization and
the words "Corporate Seal, Delaware".
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The seal may be used by causing it or a facsimile thereof to be impressed or
affixed or reproduced or otherwise.
Section 5. [Deleted]
Section 6. Certain Repurchases of Series C Preferred Stock.
(a) Any decision by the Board of Directors either (i) not to repurchase all of
the Series C Preferred Stock with respect to which holders have exercised the
Put Right, as defined in the Series C Certificate of Designation, either (x)
with cash pursuant to paragraph 9(i)(a) of the Series C Certificate of
Designation or (y) pursuant to the procedures set forth in paragraph 9(i)(b) of
the Series C Certificate of Designation, but instead to redeem such Series C
Preferred Stock with shares of Common Stock pursuant to paragraph 9(i)(a) of the
Series C Certificate of Designation, or (ii) not to redeem any of the Series C
Preferred Stock in accordance with the requirements of paragraph 9(i) of the
Series C Certificate of Designation, may only be made if a majority of the
Series C Directors consent to such decision.
(b) Any decision by the Board of Directors of the Corporation
on any Partial Repurchase Date, as defined in the Series C Certificate of
Designation, not to use all Available Cash as defined in the Series C
Certificate of Designation, to effect a Partial Repurchase, as defined in the
Series C Certificate of Designation, may only be made if a majority of the
Series C Directors consent to such decision.
ARTICLE VIII
INDEMNIFICATION
---------------
Section 1. Power to Indemnify in Actions, Suits or Proceedings
Other than Those by or in the Right of the Corporation. Subject to Section 4 of
this Article VIII, 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, conviction or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the 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.
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Section 2. Power to Indemnify in Actions, Suits or Proceedings
by or in the Right of the Corporation. Subject to Section 4 of this Article
VIII, 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 for gross negligence or willful misconduct to the
Corporation unless and only to the extent that the Court of Chancery 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 the Court of Chancery or such other court shall deem proper.
Section 3. Notwithstanding the other provisions of this
Article VIII, to the extent that a director, officer, employee or agent of the
Corporation has been successful on the merits or otherwise, including without
limitation the dismissal of an action without prejudice, in the defense of any
action, suit or proceeding referred to in Sections 2 and 3 above, or in the
defense of any claim, issue or matter therein, that person shall be indemnified
against all costs, charges and expenses (including attorneys' fees) actually and
reasonably incurred by that person or on that person's behalf in connection
therewith.
Section 4. Authorization of Indemnification. Any
indemnification under this Article VIII (unless ordered by a court) shall be
made by the Corporation unless a determination is made (i) by the Board of
Directors by a majority vote of a quorum consisting of directors who were not
parties to such action, suit or proceeding, or (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, that indemnification of the director, officer, employee or agent
is not proper because that person has not met the applicable standards of
conduct set forth in Sections 1 and 2 above.
Section 5. Good Faith Defined. For purposes of any
determination under this Article VIII, a person shall be deemed to have 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, or, with respect to any criminal
action or proceeding, to have had no reasonable cause to believe his or her
conduct was unlawful, if his or her action is based on the records or books of
account of this Corporation or another enterprise, or on information supplied to
him or her by the officers of the Corporation or another enterprise in the
course of their duties, or on the advice of legal counsel for the Corporation or
another enterprise or on information or record given or reports made to the
Corporation or another enterprise by an independent certified public accountant
or by an appraiser or other expert selected with reasonable care by the
Corporation or another enterprise. The term "another enterprise" as used in this
Section 5 shall mean any other
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corporation or any partnership, joint venture, trust or other enterprise of
which such person is or was serving at the request of the Corporation as a
director, officer, employee or agent. The provisions of this Section 5 shall not
be deemed to be exclusive or to limit in any way the circumstances in which a
person may be deemed to have met the applicable standard of conduct set forth in
Sections 1 and 2 of this Article VIII, as the case may be.
Section 6. Indemnification by a Court. Notwithstanding any
contrary determination in the specific case under Section 4 of this Article
VIII, and notwithstanding the absence of any determination thereunder, any
director, officer, employee or agent may apply to any court of competent
jurisdiction in the State of Delaware for indemnification to the extent
otherwise permissible under Sections 1 and 2 of this Article VIII. The basis of
such indemnification by a court shall be a determination by such court that
indemnification of the director, officer, employee or agent is proper in the
circumstances because he or she has met the applicable standards of conduct set
forth in Sections 1 and 2 of this Article VIII, as the case may be. Notice of
any application for indemnification pursuant to this Section 6 shall be given to
the Corporation promptly upon the filing of such application.
Section 7. Advance of Costs, Charges and Expenses. Costs,
charges and expenses (including attorneys' fees) incurred by a person referred
to in Sections 1 and 2 above in defending a civil or criminal action, suit or
proceeding (including investigations by any government agency and all costs,
charges and expenses incurred in preparing for any threatened action, suit or
proceeding) shall be paid by the Corporation in advance of the final disposition
of such action, suit or proceeding; provided however, that the payment of such
costs, charges and expenses incurred by a director or officer in that person's
capacity as a director or officer (and not in any other capacity in which
service was or is rendered by such person while a director or officer) in
advance of the final disposition of such action, suit or proceeding shall be
made only upon receipt of an undertaking by or on behalf of the director or
officer to repay all amounts so advanced in the event that it shall ultimately
be determined that such director or officer is not entitled to be indemnified by
the Corporation as authorized in this Article VIII. No security be required for
such undertaking and such undertaking shall be accepted without reference to the
recipient's financial ability to make repayment. The repayment of such charges
and expenses incurred by other employees and agents of the Corporation which are
paid by the Corporation in advance of the final disposition of such action, suit
or proceeding as permitted by this Section 7 may be required upon such terms and
conditions, if any, as the Board of Directors deems appropriate. The Board of
Directors may, in the manner set forth above, and subject to the approval of
such director, officer, employee or agent of the Corporation, authorize the
Corporation's counsel to represent such person, in any action, suit or
proceeding, whether or not the Corporation is party to such action, suit or
proceeding.
Section 8. Procedure for Indemnification. Any indemnification
under Sections 1, 2 or 3 or advance of costs, charges and expenses under Section
7 of this Article VIII shall be made promptly, and in any event, within sixty
(60) days, upon the written request of the director, officer, employer or agent
directed to the Secretary of the Corporation. The right to indemnification or
advances granted in this Article VIII shall be enforceable by the director,
officer, employer or agent in any court of competent jurisdiction if the
Corporation denies such request, in whole or part, or if no disposition thereof
is made within sixty (60) days. Such
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person's costs and expenses incurred in connection with successfully
establishing that person's right to indemnification or advances, in whole or in
part, in any such action shall also be indemnified by the Corporation. It shall
be a defense to any such action (other than an action brought to enforce a claim
for advance costs, charges and expenses under Section 7 of this Article VIII
where the required undertaking, if any, has been received by the Corporation)
that the claimant has not met the standard of conduct set forth in Sections 1 or
2 of this Article VIII, but the burden of proving such standard of conduct has
not been met shall be on the Corporation. Neither the failure of the Corporation
(including its Board of Directors, its independent legal counsel and its
stockholders) to have made such a determination prior to the commencement of
such action that indemnification of the claimant is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in
Sections 1 and 2 of this Article VIII, nor the fact that there has been an
actual determination by the Corporation (including its Board of Directors, its
independent legal counsel and its stockholders) that the claimant has not met
such applicable standard, shall be a defense to the action or create a
presumption that the claimant has not met the applicable standard of conduct.
Section 9. Non-Exclusivity of Indemnification and Advancement
of Expenses. 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, contract, vote of stockholders or
disinterested directors or pursuant to the direction (howsoever embodied) of any
court of competent jurisdiction or otherwise, both as to action in his or her
official capacity and as to action in another capacity while holding such
office, it being the policy of the Corporation that indemnification of the
persons specified in Sections 1 and 2 of this Article VIII shall be made to the
fullest extent permitted by law. The provisions of this Article VIII shall not
be deemed to preclude the indemnification of any person who is not specified in
Sections 1 or 2 of this Article VIII but whom the Corporation has the power or
obligation to indemnify under the provisions of the General Corporation Law of
the State of Delaware, or otherwise.
Section 10. 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 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 or the obligation to indemnify him or her against such liability
under the provisions of this Article VIII.
Section 11. Meaning of "Corporation" for Purposes of Article
VIII. For purposes of this Article VIII, references to "the Corporation" shall
include, in addition to the resulting 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 and 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 for 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
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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.
Section 12. Survival of Indemnification and Advancement of
Expenses. The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, 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 a person.
ARTICLE IX
OWNERSHIP BY FOREIGN PERSONS
----------------------------
Section 1. Foreign Stock Record. There shall be maintained a
separate stock record, designated the "Foreign Stock Record", for the
registration of Alien Owned Shares. The Beneficial Ownership by Persons of Alien
Owned Shares shall be determined in conformity with regulations prescribed by
the Board of Directors.
Section 2. Permitted Percentage. At no time shall ownership of
shares representing more than the Permitted Percentage be registered on the
Foreign Stock Record.
Section 3. Registration of Shares. If at any time there exist
Alien Owned Shares that are not registered on the Foreign Stock Record, the
Beneficial Owner thereof may request, in writing, that the Corporation register
ownership of such shares on the Foreign Stock Record and the Corporation shall
comply with such request, subject to the limitation set forth in Section 2. The
order in which Alien Owned Shares shall be registered on the Foreign Stock
Record shall be chronological, based on the date the Corporation received a
written request to so register such shares of Alien Owned Shares; provided, that
any Person who is not a U.S. Citizen who purchases or otherwise acquires Alien
Owned Shares that are registered on the Foreign Stock Record, may register such
shares in its own name within thirty days of such acquisition, in which event
such Person will assume the position of the seller of such shares in the
chronological order of shares registered on the Foreign Stock Record. If at any
time the Corporation shall find that the combined voting power of Alien Owned
Shares then registered on the Foreign Stock Record exceeds the Permitted
Percentage, there shall be removed from the Foreign Stock Record the
registration of such number of shares so registered as is sufficient to reduce
the combined voting power of the shares so registered to an amount not in excess
of the Permitted Percentage. The order in which such shares shall be removed
shall be reverse chronological order based upon the date the Corporation
received a written request to so register such shares of Alien Owned Shares.
Section 4. Definitions. Capitalized terms used in this Article
IX and not defined herein shall have the meaning ascribed to them in the
Certificate of Incorporation.
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ARTICLE X
AMENDMENTS
----------
Section 1. Subject to the voting requirements of Section 7 of
Article II and Sections 1(c) and 6 of Article III hereof, these Bylaws may be
altered, amended or repealed, in whole or in part, or new Bylaws may be adopted,
by the vote of the stockholders or the Board of Directors.
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EXHIBIT 5.1
[Letterhead of Simpson Thacher & Bartlett]
December 22, 1998
Northwest Airlines Corporation
2700 Lone Oak Parkway
Hagan, Minnesota 55121
Ladies and Gentlemen:
We have acted as your counsel in connection with the Registration
Statement on Form S-3 (the "Registration Statement") of Northwest Airlines
Corporation (formerly Newbridge Parent Corporation), a Delaware corporation
(the "Company"), which the Company intends to file with the Securities and
Exchange Commission under the Securities Act of 1933, as amended (the "Act"),
relating to, among other things, 2,631,784 shares of the Company's common
stock, par value $.01 per share (the "Shares"), issued pursuant to an
Investment Agreement dated as of January 25, 1998, as amended by Amendment
No. 1 dated as of February 27, 1998 and Amendment No. 2 dated as of November
20, 1998 among the Company, Northwest Airlines Holding Corporation, Air
Partners, L.P. (the "Partnership"), the partners of the Partnership signatory
thereto, 1998 CAI Partners, L.P., Bonderman Family Limited Partnership, 1992
Air, Inc. and Air Saipan, Inc.
We have examined a copy of the Registration Statement (including the
exhibits thereto) and originals, or duplicates or certified or conformed
copies, of such corporate records, documents or other instruments of the
Company and have made such other and further investigations as we deemed
necessary to enable us to express the opinion hereinafter set forth.
In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as duplicates or certified or conformed copies, and
the authenticity of the originals of such documents.
Based upon the foregoing, and subject to the qualifications and
limitations stated herein, we are of the opinion that the Shares have been
duly authorized by the Company and are validly issued, fully paid and
nonassessable.
We are members of the Bar of the State of New York, and we do not
express any opinion herein concerning any law other than the law of the State
of New York, the federal law of the United States of America and the Delaware
General Corporation Law.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference of this firm appearing in the
Registration Statement under the caption "Legal Matters".
Very truly yours,
SIMPSON THACHER & BARTLETT
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form S-3) and related Prospectus of Northwest
Airlines Corporation for the registration of 2,631,784 shares of its Common
Stock and to the incorporation by reference therein of our report dated
January 25, 1998 with respect to the consolidated financial statements and
schedule of Old NWA Corp. (as defined in the Registration Statement) included
in its Annual Report (Form 10-K) for the year ended December 31, 1997, filed
with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Minneapolis, Minnesota
December 21, 1998
