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EXHIBIT 3.1
RESTATED
CERTIFICATE OF INCORPORATION
OF
HYDRIL COMPANY
Under Sections 242 and 245 of the
Delaware General Corporation Law
HYDRIL COMPANY (the "Corporation"), a corporation organized and
existing under and by virtue of the General Corporation Law of the State of
Delaware, hereby certifies that:
1. The current name of the Corporation is Hydril Company. The name
under which the Corporation was originally incorporated was The Frank R. Seaver
Company. The original Certificate of Incorporation of the Corporation (as
heretofore amended, the "Certificate of Incorporation") was filed with the
Secretary of State of the State of Delaware on June 26, 1972.
2. The restatement of and amendments to the Certificate of
Incorporation have been duly adopted by a resolution of the Board of Directors
of the Corporation (the "Board of Directors") proposing and declaring advisable
the Restated Certificate of Incorporation, and the Corporation's stockholders
have duly approved and adopted the Restated Certificate of Incorporation, all in
accordance with the provisions of Sections 242 and 245 of the General
Corporation Law of the State of Delaware.
3. This Restated Certificate of Incorporation restates and amends the
Certificate of Incorporation of the Corporation. The amendments to the
Certificate of Incorporation effected by the Restated Certificate of
Incorporation include, but are not limited to, amendments (i) to increase the
number of authorized shares of capital stock that the Corporation shall have the
authority to issue, (ii) to add provisions relating to dividends, liquidation
and voting with respect to the common stock and the Class B common stock of the
Corporation, (iii) to add express provisions regarding the denial of preemptive
rights and cumulative voting, (iv) to provide for the procedure for removal of
members of the Board of Directors and the procedure for filling vacancies on the
Board of Directors, (v) to prohibit the taking of action by the stockholders of
the Corporation by less than unanimous written consent without a stockholders'
meeting, (vi) to limit the liability of a Director of the Corporation to the
Corporation or any of its stockholders to the extent permitted by Section
102(b)(7) of the General Corporation Law of the State of Delaware, (vii) to
require, for certain mergers and other transactions, the affirmative vote of (a)
holders of at least 80% of the outstanding voting stock of the Corporation and
(b) holders of at least 66-2/3% of the outstanding voting stock of the
Corporation, exclusive of voting stock beneficially owned by the party whose
interest in the transaction gives rise to the requirement of the 80% vote,
(viii) to provide for the amendment of the Bylaws of the Corporation by the
Board of Directors and by the stockholders of the
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Corporation and to establish the required vote for such amendment, and (ix) to
require, for certain amendments to the Certificate of Incorporation, the
affirmative vote of holders of at least 66-2/3% of the outstanding voting stock
of the Corporation.
4. The capital of the Corporation shall not be reduced under or by
reason of the foregoing amendments to the Certificate of Incorporation.
5. The Certificate of Incorporation is hereby superseded by the
Restated Certificate of Incorporation, which shall henceforth be the Certificate
of Incorporation of the Corporation.
6. The text of the Certificate of Incorporation is hereby restated and
amended to read in its entirety as follows (hereinafter, the Restated
Certificate of Incorporation, as it may be further amended or restated from time
to time, is referred to the "Restated Certificate of Incorporation").
RESTATED CERTIFICATE OF INCORPORATION
FIRST: The name of the Corporation is Hydril Company.
SECOND: The address of the registered office of the Corporation in the
State of Delaware is 1209 Orange Street, in the City of Wilmington, County of
New Castle. The name of its registered agent at such address is The Corporation
Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful
business, act or activity for which corporations may be organized under the
provisions of the General Corporation Law of the State of Delaware, or any
successor statute (the "DGCL").
FOURTH: The aggregate number of shares of capital stock that the
Corporation shall have authority to issue is 117,000,000, divided into classes
as follows:
(1) 75,000,000 shares of common stock, par value $0.50 per share
("Common Stock"), and
(2) 32,000,000 shares of Class B common stock, par value $0.50 per
share ("Class B Common Stock"); and
(3) 10,000,000 shares of preferred stock, par value $1.00 per share
("Preferred Stock").
Shares of any class or series of capital stock of the Corporation may
be issued for such consideration and for such corporate purposes as the Board of
Directors may from time to time determine. The number of authorized shares of
any class or series of capital stock of the Corporation may be increased or
decreased (but not below the number of shares thereof then outstanding) by the
affirmative vote of holders of at least a majority of the then outstanding
Voting Stock (as defined below), voting as a single class. The term "Voting
Stock" shall mean all outstanding shares of all classes and series of capital
stock of the Corporation entitled to vote generally in the election of Directors
of the Corporation, considered as one class; and, if the
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Corporation shall have outstanding at any time shares of Voting Stock entitled
to more or less than one vote for any such share, each reference in the Restated
Certificate of Incorporation to a proportion or percentage in voting power of
Voting Stock shall be calculated by reference to the portion or percentage of
all votes entitled to be cast by holders of all such shares generally in the
election of Directors of the Corporation.
The following is a statement of the powers, preferences and rights, and
the qualifications, limitations or restrictions, of the Preferred Stock, the
Common Stock and the Class B Common Stock.
SECTION I. PREFERRED STOCK
Shares of Preferred Stock shall be issuable from time to time in one or
more series as may be determined by the Board of Directors. Each series shall be
distinctly designated. The Board of Directors is hereby expressly granted the
authority to fix, by resolution or resolutions adopted prior to and providing
for the issuance of any shares of each particular series of Preferred Stock and
incorporated in a certificate of designations filed with the Secretary of State
of the State of Delaware, the designation, powers (including voting powers and
voting rights, full or limited, or no voting powers) and preferences, and the
relative, participating, optional or other rights, if any, and the
qualifications, limitations or restrictions thereof, if any, of such series,
including, without limiting the generality of the foregoing, the following:
(1) the designation of, and the number of shares of Preferred Stock
which shall constitute, the series, which number may be increased (except as
otherwise fixed by the Board of Directors) or decreased (but not below the
number of shares thereof then outstanding) from time to time by action of the
Board of Directors;
(2) the rate and times at which (or the method of determination
thereof), and the terms and conditions upon which, dividends, if any, payable in
cash, in kind or otherwise on shares of the series shall be paid, the nature of
any preferences or the relative rights of priority of such dividends to the
dividends payable, and the qualifications, limitations or restrictions, if any,
with respect to such dividends payable, on any other shares of class or classes
of capital stock of the Corporation or on any shares of other series of
Preferred Stock, and a statement whether or in what circumstances such dividends
shall be cumulative;
(3) whether shares of the series shall be convertible into or
exchangeable for shares of any class or series of capital stock or other
securities or property of the Corporation or of any other corporation or entity,
and, if so, the terms and conditions of such conversion or exchange, including
any provisions for the adjustment of the conversion or exchange rate in such
events as the Board of Directors shall determine;
(4) whether shares of the series shall be redeemable, and, if so, the
terms and conditions of such redemption (including whether redemption shall be
optional or mandatory), including the date or dates or event or events upon or
after the occurrence of which they shall be redeemable, and the amount and type
of consideration payable in case of redemption, which amount per share may vary
under different conditions and at different redemption dates;
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(5) the rights, if any, of holders of shares of the series upon the
voluntary or involuntary liquidation, merger, consolidation, distribution or
sale of assets, dissolution or winding-up of the Corporation, and the relative
rights of priority, if any, of payment of shares of the series;
(6) whether shares of the series shall have a sinking fund or purchase
account for the redemption or purchase of shares of the series, and if so, the
terms, conditions and amount of such sinking fund or purchase account;
(7) whether shares of the series shall have voting rights in addition
to the voting rights as shall be provided by law and, if so, the terms of such
voting rights, which may, without limiting the generality of the foregoing,
include the right to vote, as a series by itself or together with other series
of Preferred Stock or together with all series of Preferred Stock as a class
and/or with the Common Stock and/or with the Class B Common Stock as a class,
upon such matters, under such circumstances and upon such conditions as the
Board of Directors shall determine, including, without limitation, the right,
voting as a series by itself or together with other series of Preferred Stock or
together with all series of Preferred Stock as a class and/or with the Common
Stock and/or with the Class B Common Stock as a class, to elect one or more
Directors of the Corporation under such circumstances and upon such conditions
as the Board of Directors shall determine; and
(8) any other powers, preferences and relative, participating, optional
or other rights, and qualifications, limitations or restrictions of shares of
that series.
The relative powers, preferences and rights of each series of Preferred
Stock in relation to the powers, preferences and rights of each other series of
Preferred Stock shall, in each case, be as fixed from time to time by the Board
of Directors in the resolution or resolutions adopted pursuant to the authority
granted in this Section I of this Article Fourth, and the consent, by class or
series vote or otherwise, of holders of Preferred Stock of such of the series of
Preferred Stock as are from time to time outstanding shall not be required for
the issuance by the Board of Directors of any other series of Preferred Stock,
whether or not the powers, preferences and rights of such other series shall be
fixed by the Board of Directors as senior to, or on a parity with, the powers,
preferences and rights of such outstanding series, or any of them; provided,
however, that the Board of Directors may provide in such resolution or
resolutions adopted with respect to any series of Preferred Stock that the
consent of holders of at least a majority (or such greater proportion as shall
be therein fixed) of the outstanding shares of such series voting thereon shall
be required for the issuance of shares of any or all other series of Preferred
Stock.
SECTION II. COMMON STOCK
(1) Dividends. Subject to any requirements with respect to preferential
or participating dividends as shall be provided by the express terms of any
outstanding series of Preferred Stock, holders of the Common Stock and the Class
B Common Stock shall be entitled to receive such dividends thereon, if any, as
may be declared from time to time by the Board of Directors. Except as
hereinafter provided with respect to dividends consisting of shares of Common
Stock and Class B Common Stock, all dividends that the Board of Directors may
declare from time to time on the Common Stock and the Class B Common Stock shall
be
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declared and paid in an equal amount per share on all shares of Common Stock and
Class B Common Stock then outstanding. Dividends consisting of shares of Common
Stock and Class B Common Stock, or capital stock or other securities convertible
into or exchangeable for shares of Common Stock and Class B Common Stock, shall
be declared by the Board of Directors and shall be paid by the Corporation only
as follows: (i) dividends consisting of shares of Common Stock or capital stock
or other securities convertible into or exchangeable for shares of Common Stock
shall only be declared and paid to holders of shares of Common Stock and
dividends consisting of shares of Class B Common Stock or capital stock or other
securities convertible into or exchangeable for shares of Class B Common Stock
shall only be declared and paid to holders of shares of Class B Common Stock;
and (ii) the number of shares of Class B Common Stock or capital stock or other
securities convertible into or exchangeable for shares of Class B Common Stock
declared and paid as a dividend with respect to each outstanding share of Class
B Common Stock shall be equal to the number of shares of Common Stock or capital
stock or other securities or other securities convertible or exchangeable for
shares of Common Stock declared and paid as a dividend with respect to each
outstanding share of Common Stock.
(2) Liquidation. In the event of liquidation, dissolution or winding-up
of the Corporation, whether voluntary or involuntary, holders of the Common
Stock and the Class B Common Stock then outstanding shall be entitled to receive
such assets and properties of the Corporation, tangible and intangible, as are
available for distribution to stockholders of the Corporation ratably in
proportion to the number of shares of Common Stock and Class B Common Stock held
by each holder, after there shall have been paid or set apart for payment the
full amounts necessary to satisfy any preferential or participating rights to
which holders of each outstanding series of Preferred Stock are entitled by the
express terms of such series.
(3) Voting.
(a) The holders of shares of Common Stock and the holders of
shares of Class B Common Stock shall be entitled to receive notice of
and to attend all meetings of the stockholders of the Corporation and
to vote together as a single class (subject to any right that may be
conferred upon holders of Preferred Stock to vote together with holders
of Common Stock and/or Class B Common Stock) at all such meetings on
each matter submitted to a vote of stockholders, except as provided by
the Restated Certificate of Incorporation or otherwise provided by
Delaware law with respect to meetings or matters as to which only the
holders of one class or series of shares of the Corporation's capital
stock are entitled to vote separately as a class or series, as the case
may be. At any meeting at which the holders of shares of Common Stock
and the holders of shares of Class B Common Stock are entitled to vote
together, the shares of Common Stock shall carry one vote per share and
the shares of Class B Common Stock shall carry ten votes per share. The
holders of shares of Class B Common Stock shall be entitled to one vote
per share held at any meeting of holders of shares of Class B Common
Stock at which they are entitled to vote separately as a class. The
holders of shares of Common Stock shall be entitled to one vote per
share at any meeting of holders of shares of Common Stock at which they
are entitled to vote separately as a class.
(b) Except as otherwise provided by Delaware law or Article
Ninth hereof, the provisions of the Restated Certificate of
Incorporation shall not be modified,
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revised, altered or amended, repealed or rescinded, in whole or in
part, without the affirmative vote of holders of at least a majority of
the then outstanding Voting Stock, voting together as a single class;
provided, however, that any proposal to modify, revise, alter or amend
the Restated Certificate of Incorporation in any manner that would
alter or change the powers, preferences or special rights of the shares
of either the Common Stock or the Class B Common Stock so as to affect
them adversely also will require the approval of the holders of a
majority of the votes entitled to be cast by the holders of the shares
of the class so affected by the proposed amendment, voting separately
as a class. Any increase in the authorized number of shares of any
class or classes of stock of the Corporation, or the creation,
authorization or issuance of any securities convertible into, or
warrants, options or similar rights to purchase, acquire or receive,
shares of any such class or classes of stock, shall be deemed not to
affect adversely the powers, preferences or special rights of the
shares of either the Common Stock or the Class B Common Stock.
(c) The class voting rights accorded to the Common Stock and
the Class B Common Stock by paragraph 3(b) of this Section II shall not
apply to any modification, revision, alteration or amendment of any of
the provisions of the Restated Certificate of Incorporation effected by
a merger to which the Corporation is a party if the Common Stock and
the Class B Common Stock would in such merger be converted into
(A) a right to receive cash;
(B) any equity security, if that equity security is registered
pursuant to Section 12 of the Securities Exchange Act of
1934, as amended (the "Exchange Act") or was issued by a
corporation that is then subject to the reporting
obligations imposed by Section 15(d) of the Exchange Act
as a result of registration of an offering of that equity
security under the registration provisions of the
Securities Act of 1933, as amended (any such security
being referred to herein as an "Equity Security");
(C) any security immediately convertible into or exchangeable
for an Equity Security;
(D) any option or warrant immediately exercisable with respect
to an Equity Security; or
(E) any combination of any of the foregoing.
(4) Conversion of Shares of Class B Common Stock.
(a) Shares of Common Stock may not be converted into shares of
Class B Common Stock. Each share of Class B Common Stock shall be
convertible at any time at the option of the holder thereof into one
share of fully paid and nonassessable Common Stock as follows:
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(A) such right shall be exercised by the surrender of the
certificate representing such share of Class B Common
Stock to be converted to the Corporation at any time
during normal business hours to the office of the
Secretary of the Corporation at the principal executive
offices of the Corporation, or, if an agent for the
registration of transfer of shares of Class B Common Stock
is then duly appointed and acting (said agent being
hereinafter called the "Transfer Agent"), then at the
office of the Transfer Agent, accompanied by a written
notice of the election by the holder thereof to convert
and (if so required by the Corporation or the Transfer
Agent) by instruments of transfer, in form satisfactory to
the Corporation or the Transfer Agent, duly executed by
such holder or his duly authorized attorney, and transfer
tax stamps or funds therefor, if required pursuant to
subparagraph (C) below;
(B) as promptly as practicable after the surrender for
conversion of a certificate representing shares of Class B
Common Stock in the manner provided in the foregoing
paragraph and the payment in cash of any amount required
by the provisions of subparagraph (A) above and
subparagraph (C) below, the Corporation will deliver or
cause to be delivered at the office of the Corporation or
the Transfer Agent to or upon the written order of the
holder of such certificate, a certificate or certificates
representing the number of full shares of Common Stock
issuable upon such conversion, issued in such name or
names as such holder may direct. Such conversion shall be
deemed to have been made immediately prior to the close of
business on the date of the surrender of the certificate
representing shares of Class B Common Stock, and all
rights of the holder of such shares as such holder shall
cease at such time and the person or persons in whose name
or names the certificate or certificates representing the
shares of Common Stock are to be issued shall be treated
for all purposes as having become the record holder or
holders of such shares of Common Stock at such time;
provided, however, that if any such surrender occurs on
any date when the stock transfer books of the Corporation
shall be closed, the person or persons in whose name or
names the certificate or certificates representing shares
of Common Stock are to be issued shall be treated for all
purposes as having become the record holder or holders
thereof and such conversion shall be deemed to have been
made, immediately prior to the close of business on the
next succeeding day on which such stock transfer books are
open; and
(C) the issuance of certificates for shares of Common Stock
upon conversion of shares of Class B Common Stock shall be
made without charge for any stamp or other similar tax in
respect of such issuance; provided however, that if any
such certificate is to be
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issued in a name other than that of the holder of the
share or shares of Class B Common Stock converted, the
person or persons requesting the issuance thereof shall
pay to the Corporation the amount of any applicable tax
that may be payable in respect of any transfer involved in
such issuance or shall establish to the satisfaction of
the Corporation that such tax has been paid.
(b) Each share of Class B Common Stock will be converted
automatically and without any action on the part of the holder into a
share of Common Stock as of any time at which the number of outstanding
shares of Class B Common Stock shall first fall below 10% of the number
of outstanding shares of Common Stock and Class B Common Stock,
combined. From and after such time, no additional shares of Class B
Common Stock shall be issued by the Corporation, and the authorized
common stock of the Corporation shall thereupon consist of a single
class of 75,000,000 shares of Common Stock.
(c) Each share of Class B Common Stock will be converted
automatically into a share of Common Stock upon any Transfer (as
defined in paragraph (4)(h) of this Section II) thereof, if the
Transfer is not to a Permitted Transferee (as defined in paragraph
(4)(g) of this Section II) and made in accordance with paragraph (4)(f)
of this Section II below, effective immediately prior to the close of
business as of the date on which certificates representing such are
presented for transfer on the books of the Corporation; and the
transferee shall have no rights as a holder of Class B Common Stock or
any other rights against or with respect to the Corporation in respect
of such shares of Class B Common Stock, except the right to have
registered in the name of such transferee the shares of Common Stock
issued on such conversion. Any person who takes shares of Class B
Common Stock in a Transfer may treat the endorsement on the certificate
representing such shares, or the instrument of transfer accompanying
such shares, as authorizing such person on behalf of the transferor, to
surrender such certificates in the manner provided in paragraph (4)(a)
of this Section II for the purpose of registering the Transfer to such
person of the shares of Common Stock issuable upon conversion and
obtaining a certificate representing such shares of Common Stock.
(d) Upon any conversion of shares of Class B Common Stock into
shares of Common Stock pursuant to the provisions of paragraph (4) of
this Section II, any dividend, for which the record date or payment
date is subsequent to the conversion, that has been declared on the
shares of Class B Common Stock so converted shall be deemed to have
been declared, and shall be payable, with respect to the shares of
Common Stock into or for which the shares of Class B Common Stock are
so converted, and any such dividend that is declared on the shares of
Class B Common Stock payable in shares of Class B Common Stock shall be
deemed to have been declared, and shall be payable, in an equal number
of shares of Common Stock.
(e) The Corporation at all times shall reserve and keep
available, out of its authorized but unissued Common Stock, at least
the number of shares of Common Stock that would become issuable upon
the conversion of all shares of Class B Common Stock then outstanding.
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(f) Shares of Class B Common Stock shall be transferred on the
books of the Corporation, and a new stock certificate representing
Class B Common Stock issued therefor, upon presentation to the office
of the Secretary of the Corporation at any time during normal business
hours at the principal executive offices of the Corporation, or at the
office of the Transfer Agent, if any, of the certificate for the shares
of Class B Common Stock, in proper form for transfer and accompanied by
all requisite stock transfer tax stamps, together with an affidavit
from the holder stating that the stock certificate is being presented
to effect a Transfer of the shares to a Permitted Transferee. Such
affidavit shall be verified as of a date not earlier than five days
prior to the date of delivery of the affidavit.
(g) "Permitted Transferee" means:
(A) a natural person, who (i) was or is the holder of any
shares of Class B Common Stock, (ii) is a lineal
descendant of a parent of a natural person who satisfies,
or while living did satisfy, the provisions of (i), or
(iii) is a spouse or surviving spouse of a natural person
who satisfies, or while living did satisfy, the provisions
of either (i) or (ii) (the persons referred to in (i)
through (iii) being referred to herein as "Qualified
Natural Persons");
(B) two or more Qualified Natural Persons;
(C) the estate of a deceased holder of Class B Common Stock
provided that such transfer was pursuant to the deceased
holder's will or the laws of distribution;
(D) the Corporation or any of its subsidiaries;
(E) an employee benefit plan sponsored by the Corporation or
any of its subsidiaries;
(F) a trust (including a voting trust) or trustee of a trust,
and any savings or retirement account, such as an
individual retirement account for purposes of federal
income tax laws, whether or not involving a trust,
principally for the benefit of such transferor and/or any
of his or her Permitted Transferees or Permitted
Transferees thereof, including any trust in respect of
which such transferor and/or his or her Permitted
Transferees, or Permitted Transferees thereof have any
general or special power of appointment or general or
special non-testamentary power or special testamentary
power of appointment limited to any of his or her
Permitted Transferees or Permitted Transferees thereof,
and including any trust that provides that trust assets
may be used to pay taxes and other obligations of the
trust or of the estate of one or more Qualified Natural
Persons payable by reason of the death of such Qualified
National Persons; provided, however, that if for
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any reason, following the Transfer, such trustee, trust or
account would no longer qualify as a Permitted Transferee,
all shares of Class B Common Stock then held by such
trustee, trust or account shall, upon the election of the
Corporation given by written notice mailed to such
trustee, trust or account, without further action, be
converted into a like number of shares of Common Stock
effective upon the date of the mailing of such notice, and
stock certificates formerly representing such shares of
Class B Common Stock shall thereupon and thereafter be
deemed to represent the like number of shares of Common
Stock; and provided further that the Company may treat the
failure of any such trustee, trust or account to provide
such affidavits or other proof as the Corporation may
require, in accordance with subparagraph 4(j) of this
Section II as conclusive evidence of a change by reason of
which such trustee, trust or account no longer qualifies
as a Permitted Transferee;
(G) a transferee as successor trustee or as co-trustee of a
trust of which his immediate transferor was or is a
trustee registered as a holder of such shares of Class B
Common Stock;
(H) any organization contributions to which are deductible for
federal income tax, estate or gift tax purposes (a
"Charitable Organization") that agrees in writing to sell
such shares to the Corporation immediately following the
transfer;
(I) any corporation a majority of the record and beneficial
ownership of outstanding capital stock entitled to vote
for the election of directors of which is owned by, or a
partnership a majority of the record and beneficial
ownership of the partnership interests entitled to
participate in the management of the partnership of which
are held by, the transferor and/or his or her Permitted
Transferees or Permitted Transferees thereof; provided,
however, that if by reason of any change in the ownership
of such stock or partnership interests following the
Transfer, such corporation or partnership would no longer
qualify as a Permitted Transferee, all shares of Class B
Common Stock then held by such corporation or partnership
shall, upon the election of the Corporation given by
written notice mailed to such corporation or partnership,
without further action, be converted into a like number of
shares of Common Stock effective upon the date of the
mailing of such notice, and stock certificates formerly
representing such shares of Class B Common Stock shall
thereupon and thereafter be deemed to represent the like
number of shares of Common Stock; and provided further
that the Corporation may treat the failure of any such
corporation or partnership to provide such affidavits or
other proof at such times as the Corporation may require,
in accordance with subparagraph 4(j) of this Section II,
as conclusive evidence of
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a change in ownership by reason of which such corporation
or partnership no longer qualifies as a Permitted
Transferee;
(J) in the case of a transferor that is the executor,
administrator or personal representative of the estate of
a deceased holder of Class B Common Stock, or that is the
guardian of the estate of a minor or incompetent holder of
Class B Common Stock or that is the estate of a bankrupt
or insolvent holder of Class B Common Stock, which holds
the shares of Class B Common Stock in question, "Permitted
Transferee" also includes a Permitted Transferee of such
deceased, minor, incompetent, bankrupt or insolvent
person;
(K) in the case of a transferor holding the shares of Class B
Common Stock in question that is an employee benefit plan
sponsored by the Corporation or any of its subsidiaries,
"Permitted Transferee" also includes any distributee under
and pursuant to the terms of such plan;
(L) in the case of a transferor holding shares of Class B
Common Stock in question that is a savings or retirement
account, such as an individual retirement account for the
purposes of federal income tax laws, "Permitted
Transferee" also includes the beneficial owner of such
account;
(M) in the case of a transferor holding the shares of Class B
Common Stock in question as a trust (other than a
Charitable Organization) or as a trustee of a trust, that
was irrevocable on the Effective Time (as defined in
paragraph (10)(a) of this Section II), "Permitted
Transferee" also includes (i) any person to whom or for
whose benefit principal of such trust may be distributed,
either during or at the end of the term of such trust,
whether by power of appointment or otherwise and (ii) any
Permitted Transferee of any such person;
(N) in the case of a transferor that is a corporation or
partnership (other than a Charitable Organization) holding
shares of Class B Common Stock in question, "Permitted
Transferee" also includes (1) any person that transferred
such shares of Class B Common Stock to such corporation or
partnership and (2) any Permitted Transferee of any such
transferor;
provided, that, for purposes of this subparagraph 4(g), (i) the
relationship of any person that is derived by or through legal adoption
shall be considered a natural relationship, (ii) each joint owner of
shares, of Class B Common Stock shall be considered a holder of such
shares; (iii) a minor for whom shares of Class B Common Stock are held
pursuant to a Uniform Gifts to Minors Act or similar law shall be
considered a holder of such shares; (iv) unless otherwise specified,
the term "person" includes a natural person, corporation,
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partnership, unincorporated association, firm, joint venture, trustee
or other entity and a personal representative or guardian of an estate,
(v) each reference to a "natural person" or to a "holder" of shares, if
a natural person, shall be deemed to include in his representative
capacity, a guardian, committee, executor, administrator or other legal
representative of such natural person or holder, (vi) without
derogating from the election conferred upon the Corporation pursuant to
subclause (I) of this paragraph (4), each reference to corporation
shall include any successor corporation resulting from merger or
consolidation and each reference to a partnership shall include any
successor partnership resulting from the death or withdrawal of a
partner; and (vi) a "beneficial owner" of any shares or partnership
interest shall mean a person who, or an entity which, possesses the
power, either singly or jointly, to direct the voting or disposition of
such shares or interest and shall have the meanings ascribed to such
terms in the rules promulgated under the Exchange Act.
(h) "Transfer" means any sale, pledge, gift, bequest,
assignment or other transfer or disposition of any ownership or voting
interest in any share of Class B Common Stock, including:
(A) any offer, pledge, sale, contract to sell, sale of any
option or contract to purchase, purchase of any option or
contract to sell, grant of any option, right or warrant to
purchase, loan or other direct or indirect transfer or
disposal of: (i) any shares of Class B Common Stock, or
(ii) any securities convertible into or exercisable or
exchangeable for Class B Common Stock; or
(B) entry into any swap or other arrangement (including by way
of insurance) that transfers to another, in whole or in
part, any of the economic consequences of ownership of any
shares of Class B Common Stock or any shares of Common
Stock into which the shares of Class B Common Stock are
convertible;
whether any transaction described in clause (A) or (B) above is to be
settled by delivery of Class B Common Stock, Common Stock or other
securities, in cash or otherwise. Notwithstanding anything to the
contrary set forth in the Restated Certificate of Incorporation, any
holder of Class B Common Stock may pledge such shares to a pledgee
pursuant to a bona fide pledge of such shares as collateral security
for indebtedness due to the pledgee, provided that such shares may not
be transferred to or registered in the name of the pledgee unless such
pledgee is a Permitted Transferee. In the event of foreclosure or other
similar action by the pledgee, such pledged shares shall automatically,
without any act or deed on the part of the Corporation or any other
person, be converted into shares of Common Stock.
(i) In connection with any Transfer or conversion of any stock
of the Corporation pursuant to or as permitted by the provisions of
paragraph (4) of this Section II:
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(A) the Corporation shall be under no obligation to make any
investigation of facts unless an officer, employee or
agent of the Corporation responsible for making such
Transfer or conversion or determination or issuing Common
Stock or Class B Common Stock pursuant to such Transfer or
conversion has substantial reason to believe, or unless
the Board of Directors (or a committee of the Board of
Directors designated for the purpose) determines that
there is substantial reason to believe, that any affidavit
or other document is incomplete or incorrect in a material
respect, and
(B) neither the Corporation nor any director, officer,
employee or agent of the Corporation shall be liable in
any manner for any action taken or omitted in good faith.
(j) Proof of Status. The Corporation may, in connection with
preparing a list of stockholders entitled to vote at any meeting of
stockholders, or as a condition to the transfer or the registration of
transfer of shares of Class B Common Stock on the Corporation's books,
or at any other time for any reasonable purpose consistent with this
Section II, require the furnishing of such affidavits or other proof as
it deems necessary to establish that any person is the holder to whom
the shares of Class B Common Stock were originally deemed issued
pursuant to paragraph 10 of this Section II or is a Permitted
Transferee.
(5) Prohibition against Reissue. The Corporation shall not reissue or
resell any shares of Class B Common Stock which shall have been converted into
shares of Common Stock pursuant to or as permitted by the provisions of
paragraph 4 of this Section II, or any shares of Class B Common Stock which
shall have been acquired by the Corporation in any other manner. The Corporation
shall, from time to time, take such appropriate action as may be necessary to
retire such shares and to reduce the authorized amount of Class B Common Stock
accordingly.
(6) Subdivision and Consolidation. From and after the first date (the
"Public Status Date") on which the Corporation has outstanding a class of equity
securities registered under the Exchange Act, the Corporation may not
reclassify, combine, subdivide or consolidate the shares of Common Stock or the
shares of Class B Common Stock without at the same time proportionately
reclassifying, combining, subdividing or consolidating the shares of the other
class.
(7) Reorganization or Merger. In case of any reorganization or any
consolidation of the Corporation with one or more other corporations or a merger
of the Corporation with another corporation, each holder of a share of Common
Stock or Class B Common Stock shall be entitled to receive with respect to that
share the same kind and amount of shares of stock and other securities and
property (including cash) receivable upon the reorganization, consolidation or
merger by a holder of a share of the other class.
(8) Legend on Class B Common Stock. The Corporation may require the
certificates representing the shares of Class B Common Stock to bear a legend
noting the
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restrictions on transfer and registration of transfer of Class B Common Stock
imposed by the Restated Certificate of Incorporation.
(9) Common Stock and Class B Common Stock Otherwise Identical. Except
as otherwise set forth in this Article Fourth, the relative powers, preferences
and participating, optional or other special rights, and the qualifications,
limitations or restrictions of the Common Stock and the Class B Common Stock
shall be identical in all respects.
(10) Reclassification.
(a) The Restated Certificate of Incorporation is intended to,
and shall, effect a reclassification of the common stock, par value
$0.50 per share, of the Corporation (the "Old Common Stock") into Class
B Common Stock in accordance with the provisions of this paragraph 10.
Upon the Restated Certificate of Incorporation becoming effective in
accordance with Section 103 of the DGCL (the "Effective Time"), each
share of Old Common Stock that was issued and outstanding immediately
prior to the Effective Time shall automatically and without any action
on the part of the holder thereof or any other person be reclassified
as one share of Class B Common Stock.
(b) From and after the Effective Time, each holder of a
certificate theretofore evidencing shares of the Old Common Stock may
be surrendered by the holder thereof in exchange for a certificate or
certificates evidencing an equivalent number of shares of Class B
Common Stock.
SECTION III. CAPITAL STOCK
(1) Regarding Preemptive Rights. No stockholder of the Corporation
shall by reason of his holding shares of any class or series of capital stock of
the Corporation have any preemptive or preferential right to purchase, acquire,
subscribe for or otherwise receive any additional, unissued or treasury shares
(whether now or hereafter acquired) of any class or series of capital stock of
the Corporation now or hereafter to be authorized, or any notes, debentures,
bonds or other securities convertible into or carrying any right, option or
warrant to purchase, acquire, subscribe for or otherwise receive shares of any
class or series of capital stock of the Corporation now or hereafter to be
authorized, whether or not the issuance of any such shares, or such notes,
debentures, bonds or other securities, would adversely affect the dividends or
voting or other rights of such stockholder, and the Board of Directors may issue
or authorize the issuance of shares of any class or series of capital stock of
the Corporation, or any notes, debentures, bonds or other securities convertible
into or carrying rights, options or warrants to purchase, acquire, subscribe for
or otherwise receive shares of any class or series of capital stock of the
Corporation, without offering any such shares of any such class, either in whole
or in part, to the existing stockholders of any such class.
(2) Cumulative Voting. Cumulative voting of shares of any class or
series of capital stock of the Corporation having voting rights is prohibited.
FIFTH: (1) In General.
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(a) The powers of the Corporation shall be exercised by or
under the authority of, and the business and affairs of the Corporation
shall be managed by or under the direction of, the Board of Directors.
In addition to the authority and powers conferred upon the Board of
Directors by the DGCL, the Restated Certificate of Incorporation or the
Bylaws of the Corporation, the Board of Directors is hereby authorized
and empowered to exercise all such powers and do all such acts and
things as may be exercised or done by the Corporation, subject to the
provisions of the DGCL, the Restated Certificate of Incorporation and
any Bylaw of the Corporation adopted by the stockholders of the
Corporation; provided, however, that no Bylaw of the Corporation
hereafter adopted by the stockholders of the Corporation, nor any
amendment thereto, shall invalidate any prior act of the Board of
Directors that would have been valid if such Bylaw or amendment thereto
had not been adopted.
(b) Except as otherwise provided by the Restated Certificate
of Incorporation or the Bylaws of the Corporation or to the extent
prohibited by Delaware law, the Board of Directors shall have the right
(which, to the extent exercised, shall be exclusive) to establish the
rights, powers, duties, rules and procedures that (i) from time to time
shall govern the Board of Directors, including, without limiting the
generality of the foregoing, the vote required for any action by the
Board of Directors and (ii) from time to time shall affect the
Directors' power to manage the business and affairs of the Corporation;
no Bylaw of the Corporation shall be adopted by the stockholders of the
Corporation that shall impair or impede the implementation of this
paragraph (1)(b) of this Article Fifth.
(3) Number, Election and Terms of Directors.
(a) Subject to such rights of holders of shares of one or more
outstanding series of Preferred Stock to elect one or more Directors of
the Corporation under circumstances as shall be provided by the
Restated Certificate of Incorporation or by any provisions established
pursuant to Article Fourth hereof, the number of Directors of the
Corporation that shall constitute the Board of Directors shall not be
less than five (5) nor more than twelve (12) and shall be fixed from
time to time exclusively by, and may be increased or decreased from
time to time exclusively by the affirmative vote of at least a majority
of the Whole Board. The term "Whole Board" shall mean the total number
of authorized Directors of the Corporation whether or not there exist
any vacancies in previously authorized directorships.
(b) Election of Directors of the Corporation need not be by
written ballot unless the Bylaws of the Corporation shall so provide.
(c) Each Director of the Corporation shall hold office for the
full term for which such Director is elected and until such Director's
successor shall have been duly elected and qualified or until his
earlier death, resignation or removal in accordance with the Restated
Certificate of Incorporation and the Bylaws of the Corporation.
(d) (i) The Directors of the Corporation, other than those who
may be elected by holders of shares of one or more outstanding series
of Preferred Stock
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under circumstances as shall be provided by the Restated Certificate of
Incorporation or by any provisions established pursuant to Article
Fourth hereof, shall be divided into three classes, Class I, Class II
and Class III, the Directors of the Corporation who shall serve in
Class I, Class II and Class III having heretofore been designated by
the stockholders of the Corporation. Such classes shall be as nearly
equal in number of Directors as possible. Each Director of the
Corporation shall serve for a term ending on the third annual meeting
following the annual meeting at which such Director was elected;
provided, however, that the Directors of the Corporation first
designated to Class I shall serve for a term expiring at the annual
meeting next following the date of their designation as Class I
Directors, the Directors of the Corporation first designated to Class
II shall serve for a term expiring at the second annual meeting next
following the date of their designation as Class II Directors, and the
Directors of the Corporation first designated to Class III shall serve
for a term expiring at the third annual meeting next following the date
of their designation as Class III Directors. At each annual election of
Directors of the Corporation, such Directors chosen to succeed those
whose terms then expire shall be of the same class as the Directors of
the Corporation they succeed, unless, by reason of any intervening
changes in the authorized number of Directors of the Corporation, the
Board of Directors shall designate one or more directorships whose term
then expires as directorships of another class in order more nearly to
achieve equality of number of Directors of the Corporation among the
classes.
(ii) Notwithstanding that the three classes of Directors of
the Corporation shall be as nearly equal in number of Directors as
possible, in the event of any change in the authorized number of
Directors of the Corporation, each Director of the Corporation then
continuing to serve as such shall nevertheless continue as a Director
of the class of which he is a member until the expiration of his
current term, or his prior death, resignation or removal in accordance
with the Restated Certificate of Incorporation and the Bylaws of the
Corporation. If any newly created directorship may, consistent with the
provision that the three classes shall be as nearly equal in number of
Directors of the Corporation as possible, be allocated to one or two or
more classes, the Board of Directors shall allocate it to that of the
available classes whose terms of office are due to expire at the
earliest date following such allocation.
(4) Removal of Directors.
(a) No Director of the Corporation shall be removed from such
office by vote or other action of the stockholders of the Corporation
or otherwise, except by the affirmative vote of holders of at least a
majority of the then outstanding Voting Stock, voting together as a
single class. Prior to the Public Status Date, any such removal of a
Director of the Corporation may be with or without cause. No Director
of the Corporation shall be removed from such office by vote or other
action of the stockholders of the Corporation or otherwise, except for
cause, which shall be deemed to exist only if: (i) such Director has
been convicted, or such Director is granted immunity to testify where
another has been convicted, of a felony by a court of competent
jurisdiction (and such conviction is no longer subject to direct
appeal); (ii) such Director has been found by a court of competent
jurisdiction (and such finding is no longer subject to direct appeal)
or by the affirmative vote of at least a majority of the Whole Board at
any regular
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or special meeting of the Board of Directors called for such purpose to
have been grossly negligent or guilty of willful misconduct in the
performance of his duties to the Corporation in a matter of substantial
importance to the Corporation; (iii) such Director has been adjudicated
by a court of competent jurisdiction to be mentally incompetent, which
mental incompetency directly affects his ability to perform as a
Director of the Corporation; (iv) such Director has been found by a
court of competent jurisdiction (and such finding is no longer subject
to direct appeal) or by the affirmative vote of at least a majority of
the Whole Board at any regular or special meeting of the Board of
Directors called for such purpose to have breached such Director's duty
of loyalty to the Corporation or its stockholders or to have engaged in
any transaction with the Corporation from which such Director derived
an improper personal benefit; or (v) "cause" for removal otherwise
exists under Section 141(k)(1) of the DGCL. No Director of the
Corporation so removed may be nominated, re-elected or reinstated as a
Director of the Corporation so long as the cause for removal continues
to exist.
(b) Notwithstanding paragraph 3(a) of this Article Fifth,
whenever holders of shares of one or more outstanding series of
Preferred Stock are entitled to elect one or more Directors of the
Corporation under circumstances as shall be provided by the Restated
Certificate of Incorporation or by any provisions established pursuant
to Article Fourth hereof with respect to the rights of holders of
shares of one or more outstanding series of Preferred Stock, any
Director of the Corporation so elected may be removed in accordance
with such provisions.
(5) Vacancies. Unless otherwise provided by the Restated Certificate of
Incorporation or by any provisions established pursuant to Article Fourth hereof
with respect to the rights of holders of shares of one or more outstanding
series of Preferred Stock, newly created directorships resulting from any
increase in the authorized number of Directors of the Corporation and any
vacancies on the Board of Directors resulting from death, resignation or removal
in accordance with the Restated Certificate of Incorporation and the Bylaws of
the Corporation shall be filled only by the affirmative vote of at least a
majority of the remaining Directors of the Corporation then in office, even if
such remaining Directors constitute less than a quorum of the Board of
Directors. Any Director of the Corporation elected in accordance with the
preceding sentence shall hold office for the remainder of the full term of the
class of Directors of the Corporation in which the new directorship was created
or the vacancy occurred and until such Director's successor shall have been
elected and qualified or until his earlier death, resignation or removal in
accordance with the Restated Certificate of Incorporation and the Bylaws of the
Corporation. Unless otherwise provided by the Restated Certificate of
Incorporation or by any provisions established pursuant to Article Fourth hereof
with respect to the rights of holders of shares of one or more outstanding
series of Preferred Stock, no decrease in the number of Directors of the
Corporation constituting the Board of Directors shall shorten the term of any
incumbent Director of the Corporation.
SIXTH: On and after the Public Status Date, no action required to be
taken or that may be taken at any annual or special meeting of the stockholders
of the Corporation may be taken without a meeting, and the power of the
stockholders of the Corporation to consent in writing to the taking of any
action by written consent without a meeting is specifically denied, except for
action by unanimous written consent, which is expressly allowed. Unless
otherwise
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provided by the DGCL, by the Restated Certificate of Incorporation or by any
provisions established pursuant to Article Fourth hereof with respect to the
rights of holders of one or more outstanding series of Preferred Stock, special
meetings of the stockholders of the Corporation may be called at any time only
by the Chairman of the Board of Directors, the President of the Corporation or
by the Board of Directors pursuant to a resolution approved by the affirmative
vote of at least a majority of the Whole Board, and no such special meeting may
be called by any other person or persons.
SEVENTH: No Director of the Corporation shall be personally liable to
the Corporation or any of its stockholders for monetary damages for breach of
fiduciary duty as a Director of the Corporation involving any act or omission of
any such Director; provided, however, that this Article Seventh shall not
eliminate or limit the liability of such a Director (1) for any breach of such
Director's duty of loyalty to the Corporation or its stockholders, (2) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (3) under Section 174 of the DGCL, as the same exists
or as such provision may hereafter be amended, supplemented or replaced, or (4)
for any transactions from which such Director derived an improper personal
benefit. If the DGCL is amended after the filing of the Restated Certificate of
Incorporation to authorize corporate action further eliminating or limiting the
personal liability of Directors, then the liability of a Director of the
Corporation, in addition to the limitation on personal liability provided
herein, shall be limited to the fullest extent permitted by such law, as so
amended. Any repeal or modification of this Article Seventh by the stockholders
of the Corporation shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a Director of the Corporation existing
at the time of such repeal or modification.
EIGHTH: (1) On and after the Public Status Date, in addition to any
other affirmative vote that may be required by law, the Restated Certificate of
Incorporation or the Bylaws of the Corporation, and except as otherwise
expressly provided by paragraph (2) of this Article Eighth:
(a) any merger, consolidation or share exchange of the
Corporation or any subsidiary of the Corporation with (i) any Related
Person or (ii) any other Person (whether or not itself a Related
Person) which is, or after such merger, consolidation or share exchange
would be, a Related Person or an Affiliate of a Related Person; or
(b) any sale, lease, exchange, mortgage, pledge, transfer or
other disposition by the Corporation or any subsidiary of the
Corporation to, with or for the benefit of any Related Person or any
Affiliate of any Related Person, or by any Related Person or any
Affiliate of any Related Person to the Corporation or any subsidiary of
the Corporation, of any assets or properties having an aggregate Fair
Market Value of $5,000,000 or more; or
(c) any issuance or transfer by the Corporation or any
subsidiary of the Corporation of any securities of the Corporation or
any subsidiary of the Corporation to any Related Person or any
Affiliate of any Related Person (except (i) pursuant to the exercise,
exchange or conversion of securities exercisable for, exchangeable for
or convertible into shares of any class or series of capital stock of
the Corporation or any
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subsidiary of the Corporation, which securities were acquired by the
Related Person prior to becoming a Related Person, or (ii) pursuant to
a dividend or distribution paid or made, or the exercise, exchange or
conversion of securities exercisable for, exchangeable for or
convertible into shares of any class or series of capital stock of the
Corporation or subsidiary of the Corporation, which security is
distributed pro rata to all holders of shares of any class or series of
capital stock of the Corporation subsequent to the time the Related
Person became such, and provided in the case of this clause (ii) that
there is not an increase of more than 1% in the Related Person's
proportionate share of any class or series of capital stock of the
Corporation or of the outstanding Voting Stock as a result of such
dividend or distribution); or
(d) any adoption of any plan or proposal for the liquidation
or dissolution of the Corporation voluntarily caused or proposed by or
on behalf of a Related Person or any Affiliate of any Related Person;
or
(e) any reclassification of securities (including any reverse
stock split) or recapitalization of the Corporation, or any merger,
consolidation or share exchange of the Corporation with any of its
subsidiaries or any other transaction (whether or not with or into or
otherwise involving a Related Person) which has the effect, either
directly or indirectly, of increasing by more than 1% the proportionate
share of any outstanding shares of any class or series of capital stock
of the Corporation, or the securities convertible into shares of any
class or series of capital stock of the Corporation or any subsidiary
of the Corporation, that is Beneficially Owned by any Related Person or
any Affiliate of any Related Person or otherwise increasing the voting
power of any outstanding shares of any class or series of capital stock
of the Corporation or any subsidiary of the Corporation possessed by
any such Related Person or Affiliate; or
(f) any series or combination of transactions having, directly
or indirectly, the same effect as any of the foregoing; or
(g) any agreement, contract or other arrangement providing,
directly or indirectly, for any of the foregoing,
shall require the affirmative vote of holders of (x) at least 80% of the then
outstanding Voting Stock, voting together as a single class and (y) at least
66-2/3% of the then outstanding Voting Stock not Beneficially Owned, directly or
indirectly, by any Related Person with respect to such Business Combination,
voting together as a single class. Such affirmative vote shall be required on
and after the Public Status Date, notwithstanding the fact that no vote may be
required, or that a lesser percentage or separate class vote may be specified,
by law, elsewhere in the Restated Certificate of Incorporation, in the Bylaws of
the Corporation or in any agreement with any national securities exchange or
otherwise.
(2) The provisions of paragraph (1) of this Article Eighth shall not be
applicable to any particular Business Combination, and such Business Combination
shall require only such affirmative vote that may be required by law, any
provision of the Restated Certificate of Incorporation other than this Article
Eighth and the Bylaws of the Corporation, if all of the conditions specified in
either of the following subparagraphs (a) or (b) are met:
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(a) the cash, property, securities or other consideration to
be received per share by holders of shares of each and every
outstanding class or series of capital stock of the Corporation in the
Business Combination is, with respect to each such class or series,
either (i) the same in form and amount per share as that paid by the
Related Person in a tender offer in which such Related Person acquired
at least 50% of the outstanding shares of capital stock of such class
or series and which was consummated not more than one year prior to the
date of such Business Combination or (ii) not less in amount (as to
cash) or Fair Market Value (as to consideration other than cash) as of
the date of the determination of the Highest Per Share Price (as to
property, securities or other consideration) than the Highest Per Share
Price applicable to such class or series of shares; provided, however,
that in the event of any Business Combination in which the Corporation
survives, any shares retained by holders thereof shall constitute
consideration other than cash for purposes of this subparagraph (a); or
(b) at least a majority of all Continuing Directors shall have
expressly approved such Business Combination either in advance of or
subsequent to such Related Person's having become a Related Person.
On and after the Public Status Date, in the case of any Business
Combination with a Related Person to which subparagraph (b) above does not
apply, at least a majority of all Continuing Directors, promptly following the
request of a Related Person, shall determine the Highest Per Share Price for
shares of each class or series of capital stock of the Corporation. Such
determination shall be announced not less than five (5) days prior to the
meeting at which holders of shares vote on the Business Combination. Such
determination shall be final, unless the Related Person becomes the Beneficial
Owner of additional shares after the date of the earlier determination, in which
case at least a majority of all Continuing Directors shall make a new
determination as to the Highest Per Share Price for each class or series of
shares prior to the consummation of the Business Combination.
A Related Person shall be deemed to have acquired a share at the time
that such Related Person became the Beneficial Owner thereof. With respect to
shares owned by Affiliates, Associates and other Persons whose ownership is
attributable to a Related Person, if the price paid by such Related Person for
such shares is not determinable by at least a majority of all Continuing
Directors, the price so paid shall be deemed to be the higher of (i) the price
paid upon the acquisition thereof by the Affiliate, Associate or other Person or
(ii) the share price of the shares in question at the time when the Related
Person became the Beneficial Owner thereof.
(3) For purposes of this Article Eighth:
(a) The term "Affiliate," used to indicate a relationship to a
specified Person, shall mean a Person that directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is
under common control with, such specified Person.
(b) The term "Associate," used to indicate a relationship with
a specified Person, shall mean (i) any corporation, partnership or
other organization (other than the Corporation or any wholly owned
subsidiary of the Corporation) of which such
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specified Person is a director, officer or partner or is, directly or
indirectly, the Beneficial Owner of 10% or more of any class of equity
securities; (ii) any trust or other estate in which such specified
Person has a beneficial interest of 10% or more or as to which such
specified Person serves as trustee or in a similar fiduciary capacity;
(iii) any Person who is a director or officer of such specified Person
or any of its parents or subsidiaries (other than the Corporation or
any wholly owned subsidiary of the Corporation); and (iv) any relative
or spouse of such specified Person or of any of its Associates, or any
relative of any such spouse, who has the same home as such specified
Person or such Associate.
(c) A Person shall be a "Beneficial Owner" of any shares of
any class or series of capital stock of the Corporation (i) which such
Person or any of its Affiliates or Associates beneficially owns,
directly or indirectly; or (ii) which such Person or any of its
Affiliates or Associates has, directly or indirectly, (A) the right to
acquire (whether such right is exercisable immediately or only after
the passage of time), pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange
rights, warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the beneficial owner of any stock tendered
pursuant to a tender or exchange offer made by such Person or any of
such Person's Affiliates or Associates until such tendered stock is
accepted for purchase or exchange, or (B) the right to vote pursuant to
any agreement, arrangement or understanding; provided, however, that a
Person shall not be deemed the beneficial owner of any stock because of
such Person's right to vote such stock if the agreement, arrangement or
understanding to vote such stock arises solely from a revocable proxy
or consent given in response to a proxy or consent solicitation made to
ten (10) or more Persons; or (iii) which is beneficially owned,
directly or indirectly, by any other Person with which such Person or
any of its Affiliates or Associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or
disposing of such stock; or (iv) of which such Person would be the
Beneficial Owner pursuant to the terms of Rule 13d-3 of the Exchange
Act, as in effect on __________ ___, 2000. Stock shall be deemed
"Beneficially Owned" by the Beneficial Owner or Owners thereof.
(d) The term "Business Combination" shall mean any transaction
which is referred to in any one or more of subparagraphs (a) through
(g) of paragraph (1) of this Article Eighth.
(e) The term "Continuing Director" shall mean, with respect to
a Business Combination with any Related Person, any Director of the
Corporation (i) who is unaffiliated with the Related Person, and (ii)
who (A) was a Director of the Corporation on or immediately before the
Public Status Date, or (B) became a Director of the Corporation prior
to the time that the Related Person became a Related Person, or (C) was
recommended or nominated to become a Director of the Corporation by at
least a majority of all then Continuing Directors, acting separately or
as a part of any action taken by the Board of Directors or any
committee thereof. Without limiting the generality of the foregoing, a
Director of the Corporation shall be deemed to be affiliated with a
Related Person if such Director (i) is or at any previous time has been
an officer, director, employee or general partner of such Related
Person; (ii) is or at any previous time has been an Affiliate or
Associate of such Related Person; (iii) is or at any previous
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time has been a relative or spouse of such Related Person or of any
such officer, director, general partner, Affiliate or Associate; (iv)
performs services for, or is a member, employee, greater than 5%
stockholder or other equity owner of any organization (other than the
Corporation and its subsidiaries) that performs services for, such
Related Person or any affiliate of such Related Person, or is a
relative or spouse of any such Person; or (v) was nominated for
election as a Director of the Corporation by such Related Person.
(f) The term "Fair Market Value" shall mean, in the case of
securities, the average of the closing sale prices during the thirty
(30)-day period immediately preceding the date in question of such
security on the principal United States securities exchange registered
under the Exchange Act on which such security is listed (or the
composite tape therefor) or, if such securities are not listed on any
such exchange, the average of the closing bid quotations with respect
to such security during the thirty (30)-day period preceding the date
in question on the Nasdaq National Market or any similar system then in
use or, if no such quotations are available, the fair market value on
the date in question of such security as determined in good faith by at
least a majority of all Continuing Directors; and in the case of
property other than cash or securities, the fair market value of such
property on the date in question as determined in good faith by at
least a majority of all Continuing Directors.
(g) The term "Highest Per Share Price" shall mean (i) as to
shares of any class or series of capital stock of the Corporation of
which the Related Person Beneficially Owns 10% or more of the
outstanding shares, the highest price that can be determined to have
been paid or agreed to be paid for any share or shares of that class or
series by such Related Person in a transaction that either (A) resulted
in such Related Person Beneficially Owning 10% or more thereof or (B)
was effected at a time when such Related Person Beneficially Owned 10%
or more thereof, (ii) as to shares of any class or series of capital
stock of the Corporation of which the Related Person Beneficially Owns
shares, but not 10% or more of the outstanding shares, the highest
price that can be determined to have been paid or agreed to be paid at
any time by such Related Person for any share or shares of that class
or series that are then Beneficially Owned by such Related Person or
(iii) as to shares of any other class or series of capital stock of the
Corporation, the amount determined by at least a majority of all
Continuing Directors, on whatever basis they believe is appropriate, to
be the per share price equivalent of the highest price that can be
determined to have been paid or agreed to be paid at any time by the
Related Person for shares of any such other class or series of capital
stock of the Corporation. In determining the Highest Per Share Price,
all purchases by the Related Person and its Affiliates and Associates
shall be taken into account regardless of whether the shares were
purchased before or after the Related Person became a Related Person
and the Highest Per Share Price will be appropriately adjusted to take
into account (W) distributions paid or payable in stock, (X)
subdivisions of outstanding stock, (Y) combinations of shares of stock
into a smaller number of shares and (Z) similar events.
(h) The term "Person" shall mean any individual, corporation,
association, partnership, joint venture, trust, estate or other entity
or organization.
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(i) The term "Related Person" shall mean any Person (other
than the Corporation or any subsidiary of the Corporation and other
than any profit-sharing, employee stock ownership or other employee
benefit plan of the Corporation or any subsidiary of the Corporation or
any trustee of or fiduciary with respect to any such plan when acting
in such capacity) who or which (i) is the Beneficial Owner of 10% or
more of the aggregate voting power of all outstanding Voting Stock; or
(ii) is an Affiliate of the Corporation and, at any time within the two
(2)-year period immediately prior to the date in question, was the
Beneficial Owner of 10% or more of the aggregate voting power of all
outstanding Voting Stock; or (iii) is an assignee of or has otherwise
succeeded to any shares of any class or series of capital stock of the
Corporation which were at any time within the two (2)-year period
immediately prior to the date in question Beneficially Owned by any
Related Person, if such assignment or succession shall have occurred in
the course of a privately negotiated transaction rather than an open
market transaction. For the purposes of determining whether a Person is
a Related Person, the number of shares of any class or series of
capital stock of the Corporation deemed to be outstanding shall include
shares of such class or series of which the Person is deemed the
Beneficial Owner, but shall not include any other shares which may be
issuable pursuant to any agreement, arrangement or understanding, or
upon exercise of conversion rights, warrants or options.
(4) Nothing contained in this Article Eighth shall be construed to
relieve any Related Person from any fiduciary obligation imposed by law.
NINTH: (1) The Board of Directors is expressly empowered to adopt,
amend or repeal the Bylaws of the Corporation. Any adoption, amendment or repeal
of the Bylaws of the Corporation by the Board of Directors shall require the
affirmative vote of at least a majority of the Whole Board. The stockholders of
the Corporation shall also have the power to adopt, amend or repeal the Bylaws
of the Corporation at any annual or special meeting, by the affirmative vote of
holders of at least 66-2/3% of the then outstanding Voting Stock, voting
together as a single class, in addition to any other affirmative vote that may
be required by law, the Restated Certificate of Incorporation or the Bylaws of
the Corporation.
(2) Notwithstanding any other provision of the Restated Certificate of
Incorporation or the Bylaws of the Corporation (and in addition to any other
affirmative vote that may be required by law, the Restated Certificate of
Incorporation or the Bylaws of the Corporation), there shall be required to
amend, alter, change or repeal, directly or indirectly, or adopt any provision
inconsistent with, the provisions of Article Fifth hereof, Article Sixth hereof,
Article Seventh hereof, Article Eighth hereof or this Article Ninth, the
affirmative vote of holders of at least 66-2/3% of the then outstanding Voting
Stock, voting together as a single class.
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IN WITNESS WHEREOF, the Corporation has caused the Restated
Certificate of Incorporation to be signed and attested by its duly authorized
officers, this ____ day of __________, 2000.
HYDRIL COMPANY
By _____________________________
Name:
Title:
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