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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report
November 27, 1996
UNITED COMPANIES FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Louisiana 1-7067 71-0430414
(State or other jurisdiction of (Commission File Number) (IRS Employer
incorporation) Identification No.)
4041 Essen Lane, Baton Rouge, Louisiana 70809
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
(504) 924-6007
Not Applicable
(Former name or former address, if changed since last report)
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of Businesses Acquired
Not applicable.
(b) Pro Forma Financial Information
Not applicable.
(c) Exhibits
3.1 Restatement of the Articles of Incorporation of
United Companies Financial Corporation.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNITED COMPANIES FINANCIAL
CORPORATION
(Registrant)
Date: November 27, 1996 By: /s/ Dale E. Redman
-------------------------- ---------------------------------
Dale E. Redman, Executive Vice
President and Chief Financial
Officer
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UNITED COMPANIES FINANCIAL CORPORATION
EXHIBIT INDEX
Form 8-K
November 27, 1996
<TABLE>
<CAPTION>
Exhibit Number Description
-------------- -----------
<S> <C>
3.1 Restatement of the Articles of Incorporation of United
Companies Financial Corporation
</TABLE>
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<PAGE> 1
EXHIBIT 3.1
RESTATEMENT OF THE
ARTICLES OF INCORPORATION
OF
UNITED COMPANIES FINANCIAL CORPORATION
On November 11, 1996, pursuant to the authority granted to and vested
in the Board of Directors of United Companies Financial Corporation, a
corporation organized and existing under the Louisiana Business Corporation Law
(the "Corporation"), and in accordance with the provisions of Section 34 of the
Louisiana Business Corporation Law, La. R.S. 12:34 the Board of Directors of
the Corporation voted unanimously in favor of restating the Articles of
Incorporation of this Corporation dated May 2, 1972, as amended by Articles of
Amendment dated May 17, 1982; Articles of Amendment dated May 20, 1986;
Articles of Amendment dated May 19, 1987; Articles of Amendment dated May 31,
1988; Articles of Amendment dated February 1, 1989; Articles of Amendment dated
June 28, 1993; Articles of Amendment dated May 12, 1994; Articles of Amendment
dated July 27, 1994; Articles of Amendment dated June 13, 1995; and Articles of
Amendment dated June 19, 1995. The Corporation was incorporated on May 2,
1972. This restatement, dated as of November 11, 1996, accurately copies
(without substantive change) the Articles of Incorporation of this Corporation
and all amendments thereto (each amendment having been effected in conformity
with law) in effect as of the date of this restatement, all as set forth
hereinafter:
ARTICLE I
The name of the Corporation is UNITED COMPANIES FINANCIAL CORPORATION.
ARTICLE II
Section 1. The purposes of the Corporation are to engage in any
and all lawful activities for which corporations may be formed under the
Louisiana Business Corporation Law, as it is now or hereafter amended, and any
other applicable law or laws of the State of Louisiana.
Section 2. In furtherance and not in limitation of the general
powers conferred by the laws of the State of Louisiana, it is expressly
provided that the purposes for which the Corporation is formed are to do any
and all of the things hereinafter set forth to the same extent as natural
persons might or could do in Louisiana and in any other part of the world,
to-wit:
a. To acquire, as a going concern or otherwise, and pay for in
cash, stock or bonds of the Corporation or otherwise, the whole or any part of
the business, goodwill, rights, or other assets and to undertake or assume the
whole or any part of the obligations or liabilities of any person, firm, trust,
association or corporation.
b. To acquire by purchase, subscription or otherwise, and to
invest in, receive, hold, own, guarantee, sell, assign, exchange, transfer,
mortgage, pledge or otherwise dispose of or deal in and with any of the shares
of the capital stock, or any voting trust certificates in respect of the shares
of capital
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stock, scrip, warrants, rights, bonds, debentures, notes, trust receipts and
other securities, obligations, choses in action and evidences of indebtedness
or interest issued or created by any corporations, joint stock companies,
syndicates, associations, firms, trusts or persons, public or private, or by
the government of the United States, or by any foreign government, or by any
state, territory, province, municipality or other political subdivision or by
any government agency; and to issue stocks, bonds or other obligations of the
Corporation in exchange therefor; and as owner thereof to possess and exercise
all the rights, powers and privileges of ownership, including the right to
execute consents and vote thereon, and to do any and all acts and things
necessary or advisable for the preservation, protection, improvement and
enhancement in value thereof.
c. To borrow or raise monies for any of the purposes of the
Corporation and, from time to time without limit as to amount, to draw, make,
accept, endorse, execute and issue promissory notes, drafts, bills of exchange,
warrants, bonds, debentures and other negotiable or non-negotiable instruments
and evidences of indebtedness, and to secure the payment of any thereof and of
the interest thereon by mortgage upon or pledge, conveyance or assignment in
trust of the whole or any part of the property of the Corporation, whether at
the time owned or thereafter acquired, and to sell, pledge or otherwise dispose
of such bonds or other obligations of the Corporation for its corporate
purposes.
d. To purchase, hold, sell and transfer the shares of its own
capital stock; provided it shall not use its funds or property for the purchase
of its own shares of capital stock when such use would cause any impairment of
its capital and provided further that shares of its own capital stock belonging
to it shall not be voted directly or indirectly.
e. To aid by loan, subsidy or otherwise, any corporation, joint
stock company, trust, association or enterprise any obligation of which or any
interest in which is held by the Corporation or in the affairs or prosperity of
which the Corporation has a lawful interest, and to do all acts and things
designed to protect, preserve, improve or enhance the value of such obligations
or interest; to guarantee or become surety in respect to the contract,
dividends, stocks, bonds, notes and other obligations of such corporations,
joint stock companies, trusts, associations or enterprises, and to secure the
performance or payments of the same by mortgage of or lien upon any or all of
the assets of the Corporation.
f. To cause to be organized under the laws of any jurisdiction
corporations, joint stock companies, trusts or associations and to cause the
same to be dissolved, wound up, liquidated, merged or consolidated; and to sell
or lease to any such corporation, joint stock company, trust or association or
to any other corporation, joint stock company, trust or association, the whole
or any part of the property and assets of the Corporation, including its
goodwill, and the right to assume its name and to receive and accept in payment
or exchange therefor, stocks, bonds, securities, or other obligations of the
transferee, or of other corporations, joint stock companies, trusts or
associations; and to consolidate by any lawful method with any other
corporation, joint stock company, trust or association of any jurisdiction.
g. To act as agent or representative, broker or factor, for
governments, corporations, joint stock companies, trusts, associations, firms
or individuals; and to undertake and carry on the business of management.
h. To purchase, receive, take by grant, gift, devise, bequest or
otherwise, lease, or otherwise acquire, own, hold, improve, employ, use and
otherwise deal in and with real or personal property, or any interest therein,
wherever situated, and to sell, convey, lease, exchange, transfer or otherwise
dispose
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of, or mortgage or pledge, all or any of the Corporation's property and assets,
or any interest therein, wherever situated.
i. In general, to possess and exercise all the powers and
privileges granted by the Louisiana Business Corporation Law or by any other
law of Louisiana or by these Articles of Incorporation together with any powers
incidental thereto, so far as such powers and privileges are desirable or
convenient to the conduct, promotion or attainment of the business or purposes
of the Corporation.
Section 3. The business and purposes specified in the foregoing
paragraphs shall, except where otherwise expressed, be in no wise limited or
restricted by reference to, or inference from, the terms of any other paragraph
in this Articles of Incorporation, but the business and purposes specified in
each of the foregoing paragraphs of this Article shall be regarded as
independent business and purposes.
ARTICLE III
Section 1. The total number of shares of capital stock which the
Corporation shall be authorized to issue shall be 100,000,000 shares of common
capital stock with a par value of Two Dollars ($2.00) per share and 20,000,000
shares of preferred stock with a par value of Two Dollars ($2.00) per share.
The Board of Directors is authorized to amend these Articles of Incorporation
to fix and determine the terms, limitations and relative rights and preferences
of the preferred stock including, without limitation, any voting rights
thereof, to divide and issue the preferred stock in series, and to fix and
determine the variations among series to the extent permitted by law.
Section 2. Each share of common capital stock of the Corporation
shall be equal in all respects to each other share of common capital stock.
The holders of shares of common capital stock shall be entitled to vote upon
all matters submitted to a vote of the stockholders of the Corporation and each
holder of the common capital stock shall be entitled to one vote for each share
of common capital stock held of record on the books of the Corporation.
Section 3. Subject to the preferential dividend rights, if any,
applicable to shares of the preferred stock and subject to applicable
requirements, if any, with respect to the setting aside of sums
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for purchase, retirement, or sinking funds for preferred stock, the holders of
shares of the common capital stock shall be entitled to receive, to the extent
permitted by law, such dividends (payable in cash, stock or otherwise) as may
be declared by the Board of Directors at any time or from time to time out of
any funds legally available therefor.
Section 4. In the event of any voluntary or involuntary
liquidation, dissolution, distribution of assets or winding-up of the
Corporation, after distribution in full of the preferential amounts, if any, to
be distributed to the holders of shares of the preferred stock, the holders of
shares of the common capital stock shall be entitled to receive all of the
remaining assets of the Corporation of whatever kind available for distribution
to its stockholders, ratably in proportion to the number of shares of the
common capital stock held by them respectively. A liquidation, dissolution,
distribution of assets or winding up of the Corporation, as such terms are used
in this Section 4, shall not be deemed to be occasioned by or to include any
consolidation or merger of the Corporation or a sale, lease or conveyance of
all or a part of the assets of the Corporation.
Section 5. Series A Junior Participating Preferred Stock.
PARAGRAPH 1. DESIGNATION AND AMOUNT. The shares of such series shall
be designated as "Series A Junior Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting the Series A Preferred
Stock shall be 1,000,000. 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 A 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 Corporation
convertible into Series A Preferred Stock.
PARAGRAPH 2. DIVIDENDS AND DISTRIBUTIONS.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and superior to
the Series A Preferred Stock with respect to dividends, the holders of shares
of Series A Preferred Stock, in preference to the holders of Common Stock, par
value $2.00 per share (the "Common Stock"), of the Corporation, and of any
other junior 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 first day of March, June, September
and December in each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the nearest cent)
equal
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to the greater of (a) $1.00 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
shares of Common Stock or a subdivision of the outstanding shares of Common
Stock (by reclassification or otherwise), declared on the Common Stock since
the immediately preceding Quarterly Dividend Payment Date or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any
share or fraction of a share of Series A Preferred Stock. In the event the
Corporation shall at any time declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount to which holders of shares of Series A 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 shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (A) of this Paragraph 2
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock); provided that, in
the event no dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date and the
next subsequent Quarterly Dividend Payment Date, a dividend of $1.00 per share
on the Series A Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly 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 Quarterly
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
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment Date,
in either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series A
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 A 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.
PARAGRAPH 3. VOTING RIGHTS. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof to 100
votes on all matters submitted to a vote of the shareholders of the
Corporation. In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of
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Common Stock, then in each such case the number of votes per share to which
holders of shares of Series A 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 shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other Articles of
Amendment to the Articles of Incorporation creating a series of Preferred Stock
or any similar stock, or by law, the holders of shares of Series A Preferred
Stock and the holders of shares of Common Stock and any other capital stock of
the Corporation having general voting rights shall vote together as one class
on all matters submitted to a vote of shareholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A 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 Stock as set forth herein) for taking any corporate
action.
PARAGRAPH 4. CERTAIN RESTRICTIONS.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in Paragraph
2 are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except dividends paid ratably on the Series
A 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;
(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 A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such junior
stock in exchange for shares of any stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or
winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any shares of
stock ranking on a parity with the Series A 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.
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(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (A) of
this Paragraph 4, purchase or otherwise acquire such shares at such time and in
such manner.
PARAGRAPH 5. REACQUIRED SHARES. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part of a new series
of Preferred Stock subject to the conditions and restrictions on issuance set
forth herein, in the Articles of Incorporation, or in any other Articles of
Amendment to the Articles of Incorporation creating a series of Preferred Stock
or any similar stock or as otherwise required by law.
PARAGRAPH 6. LIQUIDATION, DISSOLUTION OR WINDING UP. Upon any
liquidation, dissolution or winding up of the Corporation, no distribution
shall be made (1) to the holders of shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock, unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $100.00 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, provided that the holders of shares of
Series A 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 shares
of Common Stock, or (2) to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up) with
the Series A Preferred Stock, except distributions made ratably on the Series A
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 Corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount by a fraction
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
PARAGRAPH 7. CONSOLIDATION, MERGER, ETC. In case the Corporation
shall enter into any consolidation, merger, combination or other transaction in
which the shares of Common Stock are exchanged for or changed into other stock
or securities, cash and/or any other property,then in any such case each share
of Series A Preferred Stock shall at the same time be similarly exchanged 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 share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock), then in each
such case the amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number
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of shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
PARAGRAPH 8. NO REDEMPTION. The shares of Series A Preferred
Stock shall not be redeemable.
PARAGRAPH 9. RANK. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of assets, junior to
all series of any other class of the Corporation's Preferred Stock.
PARAGRAPH 10. AMENDMENT. The Articles of Incorporation shall not
be amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so as to affect
them adversely without, in addition to any other vote of shareholders required
by law, the affirmative vote of the holders of at least eighty percent of the
outstanding shares of Series A Preferred Stock, voting together as a single
class.
Section 6. 6 3/4% PRIDES, Convertible Preferred Stock, par
value $2.00 per share.
PARAGRAPH 1. DESIGNATION AND AMOUNT. The shares of such series
shall be designated as "6 3/4% PRIDES(SM), Convertible Preferred Stock, par
value $2.00 per share" (the "PRIDES"). The PRIDES are Preferred Redeemable
Increased Dividend Equity Securities(SM). The authorized number of shares
constituting the PRIDES shall be 1,955,000.
(SM)Service mark of Merrill Lynch & Co., Inc.
PARAGRAPH 2. DIVIDENDS.
(a) The holders of outstanding shares of PRIDES shall be entitled
to receive, when, as and if declared by the Board of Directors out of funds
legally available therefor, cumulative preferential dividends from June 16,
1995, at the rate per share of $2.97 per annum, and no more, payable quarterly
for each share of PRIDES, payable in arrears on the 1st day of each January,
April, July and October, respectively (each such date being hereinafter
referred to as a "Dividend Payment Date"), or, if any Dividend Payment Date is
not a business day, then the Dividend Payment Date shall be the next succeeding
business day; provided, however, that, with respect to any dividend period
during which a redemption occurs, the Corporation may, at its option, declare
accrued dividends to, and pay such dividends on, the redemption date, in which
case such dividends would be payable on the redemption date in cash to the
holders of the shares of PRIDES as of the record date for such dividend payment
and such accrued dividends would not be included in the calculation of the
related Call Price (as hereinafter defined). Each dividend on the shares of
PRIDES shall be payable to holders of record as they appear on the stock
register of the Corporation on such record date, not less than 10 nor more than
60 days preceding the payment dates thereof, as shall be fixed by the Board of
Directors. The first dividend payment shall be for the period from June 16,
1995 to but excluding July 1, 1995 and the first dividend will be payable on
July 1, 1995. Dividends (or amounts equal to accrued and unpaid dividends)
payable on shares of PRIDES for any period less than a full quarterly dividend
period will be computed on the basis of a 360-day year of twelve 30-day months
and the actual number of days elapsed in any period less than one month.
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Dividends on the shares of PRIDES will accrue whether or not there are
funds legally available for the payment of such dividends and whether or not
such dividends are declared on a daily basis from the previous Dividend Payment
Date. Accumulated unpaid dividends shall not bear interest. Dividends will
cease to accrue in respect of shares of PRIDES on the Mandatory Conversion Date
(as hereinafter defined) or on the date of their earlier conversion or
redemption.
The shares of PRIDES will rank on a parity, both as to payment of
dividends and distribution of assets upon liquidation, with any future
preferred stock issued by the Corporation (the "Preferred Stock") that by its
terms ranks pari passu with the shares of PRIDES.
(b) As long as any shares of PRIDES are outstanding, no dividends
for any dividend period (other than dividends payable in shares of, or
warrants, rights or options exercisable for or convertible into shares of,
Common Stock (as defined below) or any other capital stock of the Corporation
ranking junior to the shares of PRIDES as to the payment of dividends and the
distribution of assets upon liquidation ("Junior Stock") and cash in lieu of
fractional shares of such Junior Stock in connection with any such dividend)
will be paid in cash or otherwise, nor will any other distribution be made
(other than a distribution payable in Junior Stock and cash in lieu of
fractional shares of such Junior Stock in connection with any such
distribution), on any Junior Stock unless: (i) full dividends on all
outstanding shares of Preferred Stock (including the shares of PRIDES), that
does not constitute Junior Stock ("Parity Preferred Stock") have been paid, or
declared and set aside for payment, for all dividend periods terminating on or
prior to the date of such Junior Stock dividend or distribution payment to the
extent such dividends are cumulative; (ii) dividends in full, in the case of a
dividend payment with respect to Junior Stock, for any Parity Preferred Stock
dividend period commencing on or prior to the date of such Junior Stock
dividend payment or, in the case of any other distribution with respect to
Junior Stock, for the current quarterly dividend period, have been paid, or
declared and set aside for payment, on all outstanding shares of Parity
Preferred Stock to the extent such dividends are cumulative; (iii) the
Corporation has paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase, retirement, and sinking
funds, if any, for any outstanding shares of Parity Preferred Stock; and (iv)
the Corporation is not in default on any of its obligations to redeem any
outstanding shares of Parity Preferred Stock.
In addition, as long as any shares of PRIDES are outstanding, no
shares of any Junior Stock may be purchased, redeemed, or otherwise acquired by
the Corporation or any of its subsidiaries (except in connection with a
reclassification or exchange of any Junior Stock through the issuance of other
Junior Stock (and cash in lieu of fractional shares of such Junior Stock in
connection therewith) or the purchase, redemption, or other acquisition of any
Junior Stock with any Junior Stock (and cash in lieu of fractional shares of
such Junior Stock in connection therewith)) nor may any funds be set aside or
made available for any sinking fund for the purchase or redemption of any
Junior Stock unless: (i) full dividends on all outstanding shares of Parity
Preferred Stock have been paid, or declared and set aside for payment, for all
dividend periods terminating on or prior to the date of such purchase,
redemption or acquisition to the extent such dividends are cumulative; (ii) the
Corporation has paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase, retirement, and sinking
funds, if any, for any outstanding shares of Parity Preferred Stock; and (iii)
the Corporation is not in default on any of its obligations to redeem any
outstanding shares of Parity Preferred Stock.
Subject to the provisions described above, such dividends or other
distributions (payable in cash, property, or Junior Stock) as may be determined
by the Board of Directors may be declared and paid on the shares of any Junior
Stock from time to time and Junior Stock may be purchased, redeemed or
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otherwise acquired by the Corporation or any of its subsidiaries from time to
time. In the event of the declaration and payment of any such dividends or
other distributions, the holders of such Junior Stock will be entitled, to the
exclusion of holders of any outstanding Parity Preferred Stock, to share
therein according to their respective interests.
As long as any shares of PRIDES are outstanding, dividends for any
dividend period or other distributions may not be paid on any outstanding
shares of Parity Preferred Stock (other than dividends or other distributions
payable in Junior Stock and cash in lieu of fractional shares of such Junior
Stock in connection therewith), unless either: (a) (i) full dividends on all
outstanding shares of Parity Preferred Stock have been paid, or declared and
set aside for payment, for all dividend periods terminating on or prior to the
date of such Parity Preferred Stock dividend or distribution payment to the
extent such dividends are cumulative; (ii) dividends in full, in the case of a
dividend payment, for any Parity Preferred Stock dividend period commencing on
or prior to the date of such dividend payment or, in the case of any other
distribution, for the current quarterly dividend period, have been paid, or
declared and set aside for payment, on all outstanding shares of Parity
Preferred Stock to the extent such dividends are cumulative: (iii) the
Corporation has paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase, retirement, and sinking
funds, if any, for any outstanding shares of Parity Preferred Stock; and (iv)
the Corporation is not in default on any of its obligations to redeem any
outstanding shares of Parity Preferred Stock; or (b) any such dividends are
declared and paid pro rata so that the amounts of any dividends declared and
paid per share on outstanding shares of PRIDES and each other share of such
Parity Preferred Stock will in all cases bear to each other the same ratio that
accrued and unpaid dividends (including any accumulation with respect to unpaid
dividends for prior dividend periods, if such dividends are cumulative) per
share of outstanding shares of PRIDES and such other outstanding shares of
Parity Preferred Stock bear to each other.
In addition, as long as any shares of PRIDES are outstanding, the
Corporation may not purchase, redeem or otherwise acquire any Parity Preferred
Stock (except with any Junior Stock and cash in lieu of fractional shares of
such Junior Stock in connection therewith) unless: (i) full dividends on Parity
Preferred Stock have been paid, or declared and set aside for payment, for all
dividend periods terminating on or prior to the date of such Parity Preferred
Stock purchase, redemption or other acquisition payment to the extent such
dividends are cumulative; (ii) the Corporation has paid or set aside all
amounts, if any, then or theretofore required to be paid or set aside for all
purchase, retirement, and sinking funds, if any, for any Parity Preferred
Stock; and (iii) the Corporation is not in default on any of its obligations to
redeem any Parity Preferred Stock.
(c) Any dividend payment made on the shares of PRIDES shall first
be credited against the earliest accrued but unpaid dividend due with respect
to the shares of PRIDES.
(d) All dividends paid with respect to the shares of PRIDES shall
be paid pro rata to the holders entitled thereto.
(e) Holders of the shares of PRIDES shall be entitled to receive
dividends in preference to and in priority over any dividends upon any shares
of the Corporation ranking junior to the shares of PRIDES as to dividends, but
subject to the rights of holders of shares of the Corporation having a
preference and a priority over the payment of dividends on the shares of
PRIDES.
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<PAGE> 11
PARAGRAPH 3. REDEMPTIONS AND CONVERSIONS.
(a) Mandatory Conversion. On July 1, 2000 (the "Mandatory
Conversion Date"), each outstanding share of PRIDES shall convert automatically
(the "Mandatory Conversion") into shares of Common Stock at the Common
Equivalent Rate (as hereinafter defined) in effect on the Mandatory Conversion
Date and the right to receive an amount in cash equal to all accrued and unpaid
dividends on such share of PRIDES (other than previously declared dividends
payable to a holder of record on a prior date) to the Mandatory Conversion
Date, whether or not declared, out of funds legally available for the payment
of dividends, subject to the right of the Corporation to redeem the shares of
PRIDES on or after July 1, 1998 (the "Initial Redemption Date") and prior to
the Mandatory Conversion Date, as described below, and subject to the
conversion of the shares of PRIDES at the option of the holder at any time
prior to the Mandatory Conversion Date. The Common Equivalent Rate is
initially one share of Common Stock for each share of PRIDES and is subject to
adjustment as set forth below. Dividends on the shares of PRIDES shall cease
to accrue and such shares shall cease to be outstanding on the Mandatory
Conversion Date. The Corporation shall make such arrangements as it deems
appropriate for the issuance of certificates representing shares of Common
Stock and for the payment of cash in respect of such accrued and unpaid
dividends, if any, or cash in lieu of fractional shares, if any, in exchange
for and contingent upon surrender of certificates representing the shares of
PRIDES, and the Corporation may defer the payment of dividends on such shares
of Common Stock and the voting thereof until, and make such payment and voting
contingent upon, the surrender of such certificates representing the shares of
PRIDES, provided that the Corporation shall give the holders of the shares of
PRIDES such notice of any such actions as the Corporation deems appropriate and
upon such surrender such holders shall be entitled to receive such dividends
declared and paid on such shares of Common Stock subsequent to the Mandatory
Conversion Date. Amounts payable in cash in respect of the shares of PRIDES or
in respect of such shares of Common Stock shall not bear interest.
(b) Redemption by the Corporation.
(i) Right to Redeem. Shares of PRIDES are not redeemable
by the Corporation prior to the Initial Redemption
Date. At any time and from time to time on or after
the Initial Redemption Date and prior to the
Mandatory Conversion Date, the Corporation shall have
the right to redeem, in whole or in part, the
outstanding shares of PRIDES. Upon any such
redemption, the Corporation shall deliver to the
holders of shares of PRIDES, in accordance with the
provisions of this Section 6, in exchange for each
share so redeemed, the greater of (A) a number of
shares of Common Stock equal to the Call Price in
effect on the redemption date, divided by the Current
Market Price (as hereinafter defined) of the Common
Stock determined as of the second trading day
immediately preceding the Notice Date (as hereinafter
defined) or (B) .826 of a share of Common Stock
(subject to adjustment in the same manner as the
Optional Conversion Rate (as hereinafter defined) is
adjusted). The public announcement of any call for
redemption shall be made prior to, or at the time of,
the mailing of the notice of such call to holders of
shares of PRIDES as described below. If fewer than
all the outstanding shares of PRIDES are to be
redeemed, shares of PRIDES to be redeemed shall be
selected by the Corporation from outstanding shares
of PRIDES not previously redeemed by lot or pro rata
(as nearly as may be practicable) or by any other
method determined by the Board of Directors in its
sole discretion to be equitable. As used in this
subparagraph (b), the term
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<PAGE> 12
"Notice Date" with respect to any notice given by the
Corporation in connection with a redemption of shares
of PRIDES means the date on which first occurs either
the public announcement of such redemption or the
commencement of mailing of such notice to the holders
of shares of PRIDES.
(ii) Notice of Redemption. The Corporation shall provide
notice of any redemption of the shares of PRIDES to
holders of record of PRIDES to be called for
redemption not less than 15 nor more than 60 days
prior to the date fixed for such redemption. Such
notice shall be provided by mailing notice of such
redemption first class postage prepaid, to each
holder of record of shares of PRIDES to be redeemed,
at such holder's address as it appears on the stock
register of the Corporation; provided, however, that
neither failure to give such notice nor any defect
therein shall affect the validity of the proceeding
for the redemption of any shares of PRIDES to be
redeemed except as to the holders to whom the
Corporation has failed to give said notice or whose
notice was defective.
Each such notice shall state, as appropriate, the
following and may contain such other information as
the Corporation deems advisable:
(A) the redemption date;
(B) that all outstanding shares of PRIDES are to
be redeemed or, in the case of a call for
redemption of fewer than all outstanding
shares of PRIDES, the number of such shares
held by such holder to be redeemed;
(C) the number of shares of Common Stock
deliverable upon redemption of each share of
PRIDES to be redeemed and, if applicable, the
Call Price and the Current Market Price used
to calculate such number of shares of Common
Stock;
(D) the place or places where certificates for
such shares are to be surrendered for
redemption; and
(E) that dividends on the shares of PRIDES to be
redeemed shall cease to accrue on such
redemption date (except as otherwise provided
herein).
(iii) Deposit of Shares and Funds. The Corporation's
obligation to deliver shares of Common Stock and
provide funds upon redemption in accordance with this
Paragraph 3 shall be deemed fulfilled if, on or
before a redemption date, the Corporation shall
irrevocably deposit, with a bank or trust company, or
an affiliate of a bank or trust company, having an
office or agency in New York City and having a
capital and surplus of at least $50,000,000, or shall
set aside or make other reasonable provision for the
issuance of such number of shares of Common Stock as
are required to be delivered by the Corporation
pursuant to this Paragraph 3 upon the occurrence of
the related redemption (and for the payment of cash
in lieu of the issuance of fractional share amounts
and accrued and unpaid dividends payable in cash on
the shares to be redeemed as and to the
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<PAGE> 13
extent provided by this Paragraph 3). Any interest
accrued on such funds shall be paid to the
Corporation from time to time. Any shares of Common
Stock or funds so deposited and unclaimed at the end
of two years from such redemption date shall be
repaid and released to the Corporation, after which
the holder or holders of such shares of PRIDES so
called for redemption shall look only to the
Corporation for delivery of such shares of Common
Stock or funds.
(iv) Surrender of Certificates; Status. Each holder of
shares of PRIDES to be redeemed shall surrender the
certificates evidencing such shares (properly
endorsed or assigned for transfer, if the Board of
Directors shall so require and the notice shall so
state) to the Corporation at the place designated in
the notice of such redemption and shall thereupon be
entitled to receive certifIcates evidencing shares of
Common Stock and to receive any funds payable
pursuant to this Paragraph 3 following such surrender
and following the date of such redemption. In case
fewer than all the shares represented by any such
surrendered certificate are called for redemption, a
new certificate shall be issued at the expense of the
Corporation representing the unredeemed shares. If
such notice of redemption shall have been given, and
if on the date fixed for redemption, shares of Common
Stock and funds necessary for the redemption shall
have been irrevocably either set aside by the
Corporation separate and apart from its other funds
or assets in trust for the account of the holders of
the shares to be redeemed or converted (and so as to
be and continue to be available therefor) or
deposited with a bank or a trust company or an
affiliate thereof as provided herein or the
Corporation shall have made other reasonable
provision therefor, then, notwithstanding that the
certificates evidencing any shares of PRIDES so
called for redemption or subject to conversion shall
not have been surrendered, the shares represented
thereby so called for redemption shall be deemed no
longer outstanding, dividends with respect to the
shares so called for redemption shall cease to accrue
on the date fixed for redemption (except that holders
of shares of PRIDES at the close of business on a
record date for any payment of dividends shall be
entitled to receive the dividend payable on such
shares on the corresponding Dividend Payment Date
notwithstanding the redemption of such shares
following such record date and prior to such Dividend
Payment Date) and all rights with respect to the
shares so called for redemption shall forthwith after
such date cease and terminate, except for the rights
of the holders to receive the shares of Common Stock
and funds, if any, payable pursuant to this Paragraph
3 without interest upon surrender of their
certificates therefor (unless the Corporation
defaults on the delivery of such shares or the
payment of such funds). Holders of shares of PRIDES
that are redeemed shall not be entitled to receive
dividends declared and paid on such shares of Common
Stock, and such shares of Common Stock shall not be
entitled to vote, until such shares of Common Stock
are issued upon the surrender of the certificates
representing such shares of PRIDES and upon such
surrender such holders shall be entitled to receive
such dividends declared and paid on such shares of
Common Stock subsequent to such redemption date
without interest thereon.
(c) Conversion at Option of Holder. Shares of PRIDES are
convertible, in whole or in part, at the option of the holders thereof, at any
time prior to the Mandatory Conversion Date, unless
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<PAGE> 14
previously redeemed, into shares of Common Stock at a rate of .826 of a share
of Common Stock for each share of PRIDES (the "Optional Conversion Rate")
(equivalent to a conversion price of $53.24 per share of Common Stock), subject
to adjustment as set forth below. The right to convert shares of PRIDES called
for redemption shall terminate immediately prior to the close of business on
the redemption date.
Conversion of shares of PRIDES at the option of the holder may be
effected by delivering certificates evidencing such shares, together with
written notice of conversion and a proper assignment of such certificates to
the Corporation or in blank, to the office or agency to be maintained by the
Corporation for that purpose (and, if applicable, cash payment of an amount
equal to the dividend payable on such shares), and otherwise in accordance with
conversion procedures established by the Corporation. Each optional conversion
shall be deemed to have been effected immediately prior to the close of
business on the date on which the foregoing requirements shall have been
satisfied. The conversion shall be at the Optional Conversion Rate in effect
at such time and on such date.
Holders of shares of PRIDES at the close of business on a record date
for any payment of declared dividends shall be entitled to receive the dividend
payable on such shares on the corresponding Dividend Payment Date
notwithstanding the conversion of such shares following such record date and
prior to the corresponding Dividend Payment Date. However, shares of PRIDES
surrendered for conversion after the close of business on a record date for any
payment of dividends and before the opening of business on the next succeeding
Dividend Payment Date must be accompanied by payment in cash of an amount equal
to the dividend thereon which is to be paid on such Dividend Payment Date
(unless such shares have been called for redemption on a redemption date
between such record date and such Dividend Payment Date). A holder of shares
of PRIDES called for redemption on July 1, 1998 or any other Dividend Payment
Date thereafter will receive the dividend on such shares payable on that date
and will be able to convert such shares after the record date for such dividend
without paying an amount equal to such dividend to the Corporation upon
conversion. Except as provided above, upon any optional conversion of shares
of PRIDES, the Corporation shall make no payment or allowance for unpaid
dividends, whether or not in arrears, on converted shares of PRIDES or for
previously declared dividends or distributions on the shares of Common Stock
issued upon such conversion.
(d) Common Equivalent Rate and Optional Conversion Rate
Adjustments. The Common Equivalent Rate and the Optional Conversion Rate shall
be each subject to adjustment from time to time as provided below in this
subparagraph (d).
(i) If the Corporation shall, after June 16, 1995:
(A) pay a stock dividend or make a distribution
with respect to its Common Stock in shares of
such Common Stock,
(B) subdivide or split its outstanding Common
Stock into a greater number of shares,
(C) combine its outstanding shares of Common
Stock into a smaller number of shares, or
(D) issue by reclassification of its shares of
Common Stock any shares of common stock of
the Corporation,
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<PAGE> 15
then, in any such event, the Common Equivalent Rate
and the Optional Conversion Rate in effect
immediately prior to such event shall each be
adjusted so that the holder of any shares of PRIDES
shall thereafter be entitled to receive, upon
Mandatory Conversion or upon conversion at the option
of the holder, the number of shares of Common Stock
of the Corporation which such holder would have owned
or been entitled to receive immediately following any
event described above had such shares of PRIDES been
converted immediately prior to such event or any
record date with respect thereto. Such adjustment
shall become effective at the opening of business on
the business day next following the record date for
determination of stockholders entitled to receive
such dividend or distribution, in the case of a
dividend or distribution, and shall become effective
immediately after the effective date, in the case of
a subdivision split, combination or reclassification.
Such adjustments shall be made successively.
(ii) If the Corporation shall, after June 16, 1995, issue
rights (other than Rights issued pursuant to the
Rights Plan (as defined below)) or warrants to all
holders of its Common Stock entitling them (for a
period not exceeding 45 days from the date of such
issuance) to subscribe for or purchase shares of
Common Stock at a price per share less than the
Current Market Price of the Common Stock, then, in
any such event unless such rights or warrants are
issued to holder of shares of PRIDES on a pro rata
basis with the shares of Common Stock based on the
Common Equivalent Rate on the date immediately
preceding such issuance, the Common Equivalent Rate
and Optional Conversion Rate shall each be adjusted
by multiplying the Common Equivalent Rate and the
Optional Conversion Rate, in effect immediately prior
to the date of issuance of such rights or warrants,
by a fraction, of which the numerator shall be the
number of shares of Common Stock outstanding on the
date of issuance of such rights or warrants,
immediately prior to such issuance, plus the number
of additional shares of Common Stock offered for
subscription or purchase pursuant to such rights or
warrants, and of which the denominator shall be the
number of shares of Common Stock outstanding on the
date of issuance of such rights or warrants,
immediately prior to such issuance, plus the number
of additional shares of Common Stock which the
aggregate offering price of the total number of
shares of Common Stock so offered for subscription or
purchase pursuant to such rights or warrants would
purchase at such Current Market Price (determined by
multiplying such total number of shares by the
exercise price of such rights or warrants and
dividing the product so obtained by such Current
Market Price). Such adjustment shall become
effective at the opening of business on the business
day next following the record date for the
determination of stockholders entitled to receive
such rights or warrants. To the extent that shares
of Common Stock are not delivered after the
expiration of such rights or warrants, the Common
Equivalent Rate and the Optional Conversion Rate
shall each be readjusted to the Common Equivalent
Rate and the Optional Conversion Rate which would
then be in effect had the adjustments been made upon
the issuance of such rights or warrants upon the
basis of delivery of only the number of shares of
Common Stock actually delivered. Such adjustment
shall be made successively.
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<PAGE> 16
(iii) If the Corporation shall, after June 16, 1995, pay a
dividend or make a distribution to all holders of its
Common Stock of evidences of its indebtedness, cash
or other assets (including capital stock of the
Corporation but excluding any cash dividends or
distributions, other than Extraordinary Cash
Distributions (as hereinafter defined), and dividends
referred to in subparagraph (i) above) or shall issue
to all holders of its Common Stock rights or warrants
to subscribe for or purchase any of its securities
(other than Rights issued pursuant to the Rights Plan
and those referred to in subparagraph (ii) above),
then unless such dividend is paid or distribution is
made to each holder of shares of PRIDES on a pro rata
basis with the shares of Common Stock based on the
Common Equivalent Rate on the date immediately
preceding such payment or distribution, in any such
event, the Common Equivalent Rate and the Optional
Conversion Rate shall each be adjusted by multiplying
the Common Equivalent Rate and the Optional
Conversion Rate in effect on the record date
mentioned below, by a fraction of which the numerator
shall be the Current Market Price per share of the
Common Stock on the record date for the determination
of stockholders entitled to receive such dividend or
distribution, and of which the denominator shall be
such Current Market Price per share of Common Stock
less the fair market value (as determined by the
Board of Directors, whose determination shall be
conclusive, and described in a resolution adopted
with respect thereto) as of such record date of the
portion of the assets or evidences of indebtedness so
distributed or of such subscription rights or
warrants applicable to one share of Common Stock.
Such adjustment shall become effective on the opening
of business on the business day next following the
record date for the determination of stockholders
entitled to receive such dividend or distribution.
Such adjustment shall be made successively. As used
in this subparagraph (d), the term "Extraordinary
Cash Distributions" means, with respect to any cash
dividend or distribution paid on any date, the
amount, if any, by which all cash dividends and cash
distributions on the Common Stock paid during the
consecutive 12-month period ending on and including
such date (other than cash dividends and cash
distributions for which an adjustment to the Common
Equivalent Rate and the Optional Conversion Rate was
previously made) exceeds, on a per share of Common
Stock basis, 10% of the average of the daily Closing
Prices of the Common Stock over such consecutive
12-month period.
(iv) Any shares of Common Stock issuable in payment of a
dividend shall be deemed to have been issued
immediately prior to the close of business on the
record date for such dividend for purposes of
calculating the number of outstanding shares of
Common Stock under subparagraph (ii) above.
(v) The Corporation shall also be entitled to make upward
adjustments in the Common Equivalent Rate, the
Optional Conversion Rate and the Call Price, as it in
its sole discretion shall determine to be advisable,
in order that any stock dividends, subdivisions of
shares, distribution of rights to purchase stock or
securities, or distribution of securities convertible
into or exchangeable for stock (or any transaction
which could be treated as any of the foregoing
transactions pursuant to Section 305 of the Internal
Revenue Code of 1986, as amended)
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<PAGE> 17
made by the Corporation to its stockholders after
June 16, 1995 shall not be taxable.
(vi) In any case in which subparagraph 3(d) shall require
that an adjustment as a result of any event become
effective at the opening of business on the business
day next following a record date and the date fixed
for conversion pursuant to subparagraph 3(a) or
redemption pursuant to subparagraph 3(b) occurs after
such record date, but before the occurrence of such
event, the Corporation may, in its sole discretion,
elect to defer the following until after the
occurrence of such event: (A) issuing to the holder
of any converted or redeemed shares of PRIDES the
additional shares of Common Stock issuable upon such
conversion or redemption over the shares of Common
Stock issuable before giving effect to such
adjustments and (B) paying to such holder any amount
in cash in lieu of a fractional share of Common Stock
pursuant to subparagraph 3(g).
(vii) All adjustments to the Common Equivalent Rate and the
Optional Conversion Rate shall be calculated to the
nearest 1/100th of a share of Common Stock. No
adjustment in the Common Equivalent Rate or the
Optional Conversion Rate shall be required unless
such adjustment would require an increase or decrease
of at least one percent therein; provided, however,
that any adjustment which by reason of this
subparagraph (vii) is not required to be made shall
be carried forward and taken into account in any
subsequent adjustment.
(e) Adjustment for Consolidation or Merger. In case of any
consolidation or merger to which the Corporation is a party (other than a
merger or consolidation in which the Corporation is the surviving or continuing
corporation and in which the Common Stock outstanding immediately prior to the
merger or consolidation remains unchanged), or in case of any sale or transfer
to another corporation of the property of the Corporation as an entirety or
substantially as an entirety, or in case of any statutory exchange of
securities with another corporation (other than in connection with a merger or
acquisition), proper provision shall be made so that each share of PRIDES
shall, after consummation of such transaction, be subject to (i) conversion at
the option of the holder into the kind and amount of securities, cash or other
property receivable upon consummation of such transaction by a holder of the
number of shares of Common Stock into which such share of PRIDES might have
been converted immediately prior to consummation of such transaction, (ii)
conversion on the Mandatory Conversion Date into the kind and amount of
securities, cash or other property receivable upon consummation of such
transaction by a holder of the number of shares of Common Stock into which such
share of PRIDES would have converted if the conversion on the Mandatory
Conversion Date had occurred immediately prior to the date of consummation of
such transaction, plus the right to receive cash in an amount equal to all
accrued and unpaid dividends on such shares of PRIDES (other than previously
declared dividends payable to a holder of record as of a prior date), (iii)
redemption on any redemption date in exchange for the kind and amount of
securities, cash or other property receivable upon consummation of such
transaction by a holder of the number of shares of Common Stock that would have
been issuable at the Call Price in effect on such redemption date upon a
redemption of such share immediately prior to consummation of such transaction,
assuming that, if the Notice Date for such redemption is not prior to such
transaction, the Notice Date had been the date of such transaction and assuming
in each case that such holder of Common Stock failed to exercise rights of
election, if any, as to the kind or amount of securities, cash or other
property receivable upon consummation of such transaction (provided that if the
kind or amount of securities, cash or other property receivable upon
consummation of such transaction is not the same for
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<PAGE> 18
each non-electing share, then the kind and amount of securities, cash or other
property receivable upon consummation of such transaction for each non-electing
share shall be deemed to be the kind and amount so receivable per share by a
plurality of the non-electing shares). The kind and amount of securities into
or for which the shares of PRIDES shall be convertible or redeemable after
consummation of such transaction shall be subject to adjustment as described in
the immediately preceding paragraph following the date of consummation of such
transaction. The Corporation may not become a party to any such transaction
unless the terms thereof are consistent with the foregoing or consistent with
clause (iii) of Paragraph 7(c).
For purposes of the immediately preceding paragraph and subparagraph
3(g)(iii), any sale or transfer to another corporation of property of the
Corporation which did not account for at least 50% of the consolidated net
income of the Corporation for its most recent fiscal year ending prior to the
consummation of such transaction shall not in any event be deemed to be a sale
or transfer of the property of the Corporation as an entirety or substantially
as an entirety.
(f) Notice of Adjustments. Whenever the Common Equivalent Rate
and Optional Conversion Rate are adjusted as herein provided, the Corporation
shall:
(i) forthwith compute the adjusted Common Equivalent Rate
and Optional Conversion Rate in accordance herewith
and prepare a certificate signed by an officer of the
Corporation setting forth the adjusted Common
Equivalent Rate and the Optional Conversion Rate, the
method of calculation thereof in reasonable detail
and the facts requiring such adjustment and upon
which such adjustment is based, which certificate
shall be conclusive, final and binding evidence of
the correctness of the adjustment, and file such
certificate forthwith with the transfer agent for the
shares of PRIDES and the Common Stock; and
(ii) make a prompt public announcement and mail a notice
to the holders of the outstanding shares of PRIDES
stating that the Common Equivalent Rate and the
Optional Conversion Rate have been adjusted, the
facts requiring such adjustment and upon which such
adjustment is based and setting forth the adjusted
Common Equivalent Rate and Optional Conversion Rate,
such notice to be mailed at or prior to the time the
Corporation mails an interim statement to its
stockholders covering the fiscal quarter during which
the facts requiring such adjustment occurred, but in
any event within 45 days of the end of such fiscal
quarter.
(g) Notices. In case, at any time while any of the shares of
PRIDES are outstanding,
(i) the Corporation shall declare a dividend (or any
other distribution) on its Common Stock, excluding
any cash dividends; or
(ii) the Corporation shall authorize the issuance to all
holders of its Common Stock of rights or warrants to
subscribe for or purchase shares of its Common Stock
or of any other subscription rights or warrants; or
(iii) the Corporation shall authorize any reclassification
of its Common Stock (other than a subdivision or
combination thereof) or of any consolidation or
merger to which the Corporation is a party and for
which approval of any stockholders of
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<PAGE> 19
the Corporation is required (except for a merger of
the Corporation into one of its subsidiaries solely
for the purpose of changing the corporate domicile of
the Corporation to another state of the United States
and in connection with which there is no substantive
change in the rights or privileges of any securities
of the Corporation other than changes resulting from
differences in the corporate statutes of the then
existing and the new state of domicile), or of the
sale or transfer to another corporation of the
property of the Corporation as an entirety or
substantially as an entirety; or
(iv) the Corporation shall authorize the voluntary or
involuntary dissolution, liquidation or winding up of
the Corporation;
then the Corporation shall cause to be filed at each office or agency
maintained for the purpose of conversion of the shares of PRIDES, and shall
cause to be mailed to the holders of shares of PRIDES at their last addresses
as they shall appear on the stock register, at least 10 days before the date
hereinafter specified (or the earlier of the dates hereinafter specified, in
the event that more than one date is specified), a notice stating (A) the date
on which a record is to be taken for the purpose of such dividend,
distribution, rights or warrants, or, if a record is not to be taken, the date
as of which the holders of Common Stock of record to be entitled to such
dividend, distribution, rights or warrants are to be determined, or (B) the
date on which any such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their Common Stock for securities or other property
(including cash), if any, deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding up.
The failure to give or receive the notice required by this subparagraph (g) or
any defect therein shall not affect the legality or validity of any such
dividend, distribution, right or warrant or other action.
(h) Effect of Conversions and Redemptions. The person or persons
in whose name or names any certificate or certificates for shares of Common
Stock shall be issuable upon any conversion or redemption shall be deemed to
have become on the date of any such conversion or redemption the holder or
holders of record of the shares represented thereby; provided, however, that
any such surrender on any date when the stock transfer books of the Corporation
shall be closed shall constitute the person or persons in whose name or names
the certificate or certificates for such shares are to be issued as the record
holder or holders thereof for all purposes at the opening of business on the
next succeeding day on which such stock transfer books are open.
(i) No Fractional Shares. No fractional shares or script
representing fractional shares of Common Stock shall be issued upon the
redemption or conversion of any shares of PRIDES. In lieu of any fractional
share otherwise issuable in respect of the aggregate number of shares of PRIDES
of any holder which are redeemed or converted on any redemption date or upon
Mandatory Conversion or any optional conversion, such holder shall be entitled
to receive an amount in cash (computed to the nearest cent) equal to the same
fraction of the (i) Current Market Price as of the second trading day
immediately preceding the Notice Date, in the case of redemption, or (ii)
Closing Price of the Common Stock determined (A) as of the fifth Trading Date
immediately preceding the Mandatory Conversion Date, in the case of Mandatory
Conversion, or (B) as of the second Trading Date immediately preceding the
effective date of conversion, in the case of an optional conversion by a
holder. If more than one share shall be surrendered for conversion or
redemption at one time by or for the same holder, the number of
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full shares of Common Stock issuable upon conversion thereof shall be computed
on the basis of the aggregate number of shares of PRIDES so surrendered or
redeemed.
(j) Reissuance. Shares of PRIDES that have been issued and
reacquired in any manner, including shares purchased, exchanged, redeemed or
converted, shall not be reissued as part of PRIDES and shall (upon compliance
with any applicable provisions of the laws of the State of Louisiana) have the
status of authorized and unissued shares of the Preferred Stock undesignated as
to series and may be redesignated and reissued as part of any series of
Preferred Stock.
(k) Definitions. As used in this Section 6:
(i) the term "business day" shall mean any day other than
a Saturday, Sunday, or a day on which banking
institutions in the State of Louisiana are authorized
or obligated by law or executive order to close or
are closed because of a banking moratorium or
otherwise;
(ii) the term "Call Price" of each share of PRIDES shall
be the sum of (x) $45.188 on and after July 1, 1998,
to and including September 30, 1998, $45.040 on and
after October 1, 1998, to and including December 31,
1998, $44.891 on and after January 1, 1999, to and
including March 31, 1999, $44.743 on and after April
1, 1999, to and including June 30, 1999, $ 44.594 on
and after July 1, 1999, to and including September
30, 1999, $44.446 on and after October 1, 1999, to
and including December 31, 1999, $44.297 on and after
January 1, 2000, to and including March 31, 2000,
$44.149 on and after April 1, 2000, to and including
May 31, 2000, and $44.00 on and after June 1, 2000,
through July 1, 2000 and (y) all accrued and unpaid
dividends thereon to but not including the redemption
date (other than previously declared dividends
payable to a holder of record as of a prior date);
(iii) the term "Closing Price" on any day shall mean the
last reported sales price on such day or, in case no
such sale takes place on such day, the average of the
reported closing high and low quotations, in each
case on the Nasdaq National Market, or, if the Common
Stock is not listed on the Nasdaq National Market, 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, the average of the high
bid and low-asked quotations of the Common Stock in
the over-the-counter market on the day in question as
reported by the National Quotation Bureau
Incorporated, or a similarly generally accepted
reporting service, or, if no such quotations are
available, the fair market value of the Common Stock
as determined by any New York Stock Exchange member
firm selected from time to time by the Board of
Directors for such purpose;
(iv) the term "Current Market Price" price per share of
Common Stock at any date shall be deemed to be the
lesser of (x) the average of the daily Closing Prices
for the fifteen consecutive Trading Dates ending on
and including the date in question or (y) the Closing
Price of the Common Stock for such date of
determination; provided, however, if any event that
results in an adjustment of
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the Common Equivalent Rate occurs during such
fifteen-day period, the Current Market Price as
determined pursuant to the foregoing shall be
appropriately adjusted to reflect the occurrence of
such event; and
(v) the term "Trading Date" shall mean a date on which
the Nasdaq National Market (or any successor thereto)
is open for the transaction of business.
(l) Payment of Taxes. The Corporation shall pay any and all
documentary, stamp or similar issue or transfer taxes payable in respect of the
issue or delivery of shares of Common Stock on the redemption or conversion of
shares of PRIDES pursuant to this Paragraph 3; provided, however, that the
Corporation shall not be required to pay any tax which may be payable in
respect of any registration of transfer involved in the issue or delivery of
shares of Common Stock in a name other than that of the registered holder of
shares of PRIDES redeemed or converted or to be redeemed or converted, 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.
(m) Reservation of Common Stock. The Corporation shall at all
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock and/or its issued Common
Stock held in its treasury, for the purpose of effecting any Mandatory
Conversion of the shares of PRIDES or any conversion of the shares of PRIDES at
the option of the holder, the full number of shares of Common Stock then
deliverable upon any such conversion of all outstanding shares of PRIDES.
(n) Rights. Holders of the PRIDES whose shares of PRIDES are
converted into shares of Common Stock may be entitled to receive Rights (as
defined in that certain Rights Agreement dated as of July 27, 1994 between the
Corporation and Chemical Bank, as Rights Agent, a copy of which along with the
statement of the Corporation pursuant to Section 51C of the Louisiana Business
Corporation Law, was filed in the offices of the Secretary of State of the
State of Louisiana on August 1, 1994 (the "Rights Plan")) in accordance with
the terms and conditions of the Rights Plan. Holders of PRIDES who do not
convert their shares of PRIDES into Common Stock prior to a Distribution Date
(as defined in the Rights Plan) will not receive any Rights and therefore will
not be entitled to participate in the Rights Plan.
PARAGRAPH 4. LIQUIDATION RIGHTS.
(a) In the event of the liquidation, dissolution, or winding up of
the business of the Corporation, whether voluntary or involuntary, the holders
of shares of PRIDES then outstanding, after payment or provision for payment of
the debts and other liabilities of the Corporation and the payment or provision
for payment of any distribution on any shares of the Corporation having a
preference and a priority over the shares of PRIDES on liquidation, and before
any distribution to the holders of Junior Stock, shall be entitled to be paid
out of the assets of the Corporation available for distribution to its
stockholders an amount per share of PRIDES in cash equal to the sum of (i)
$44.00 plus (ii) all accrued and unpaid dividends thereon. In the event the
assets of the Corporation available for distribution to the holders of the
shares of PRIDES upon any dissolution, liquidation or winding up of the
Corporation shall be insufficient to pay in full the liquidation payments
payable to the holders of outstanding shares of PRIDES and of all other series
of Parity Preferred Stock, the holders of shares of PRIDES and of all other
series of Parity Preferred Stock shall share ratably in such distribution of
assets in proportion to
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the amount which would be payable on such distribution if the amounts to which
the holders of outstanding shares of PRIDES and the holders of outstanding
shares of such Parity Preferred Stock were paid in full. Except as provided in
this Paragraph 4, holders of PRIDES shall not be entitled to any distribution
in the event of liquidation, dissolution or winding up of the affairs of the
Corporation.
(b) For the purposes of this Paragraph 4, none of the following
shall be deemed to be a voluntary or involuntary liquidation, dissolution or
winding up of the Corporation:
(i) the sale, lease, transfer or exchange of all or
substantially all of the assets of the Corporation;
or
(ii) the consolidation or merger of the Corporation with
one or more other corporations (whether or not the
Corporation is the corporation surviving such
consolidation or merger).
PARAGRAPH 5. DEFINITION. As used in this Section 6, the term
"Common Stock" shall mean any stock of any class of the Corporation which has
no preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation and which is not subject to redemption by the Corporation.
However, shares of Common Stock issuable upon conversion of shares of PRIDES
shall include only shares of the class designated as Common Stock as of June
16, 1995, or shares of the Corporation of any class or classes resulting from
any reclassification or reclassification thereof and which have no preference
in respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation and which
are not subject to redemption by the Corporation; provided, however, that, if
at any time there shall be more than one such resulting class, the shares of
each such class then so issuable shall be substantially in the proportion which
the total number of shares of such class resulting from such reclassification
bears to the total number of shares of all classes resulting from all such
reclassification.
PARAGRAPH 6. NO PREEMPTIVE RIGHTS. The holders of shares of
PRIDES shall have no preemptive rights, including preemptive rights with
respect to any shares of capital stock or other securities of the Corporation
convertible into or carrying rights or options to purchase any such shares.
PARAGRAPH 7. VOTING RIGHTS.
(a) The holders of shares of PRIDES shall have the right with the
holders of Common Stock to vote in the election of directors and upon each
other matter coming before any meeting of the stockholders on the basis of 4/5
of a vote for each share held. The holders of shares of PRIDES and the holders
of Common Stock shall vote together as one class except as otherwise set forth
herein or as otherwise provided by law or by the Articles of Incorporation of
the Corporation.
(b) If at any time dividends payable on the shares of PRIDES or
any other series of Preferred Stock are in arrears and unpaid in an aggregate
amount equal to or exceeding the aggregate amount of dividends payable thereon
for six quarterly dividend periods, or if any other series of Preferred Stock
shall be entitled for any other reason to exercise voting rights, separate from
the Common Stock, to elect any Directors of the Corporation ("Preferred Stock
Directors"), the holders of the shares of PRIDES, voting separately as a class
with the holders of all other series of Preferred Stock upon which like voting
rights have been conferred and are exercisable, with each share of PRIDES
entitled to vote on this and
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other matters upon which Preferred Stock votes as a group, shall have the right
to vote for the election of two Preferred Stock Directors of the Corporation,
such Directors to be in addition to the number of Directors constituting the
Board of Directors immediately prior to the accrual of such right. Such right
of the holders of shares of PRIDES to elect two Preferred Stock Directors
shall, when vested, continue until all dividends in arrears on the shares of
PRIDES and such other series of Preferred Stock shall have been paid in full
and the right of any other series of Preferred Stock to exercise voting rights,
separate from the Common Stock, to elect Preferred Stock Directors shall
terminate or have terminated and, when so paid, and any such termination occurs
or has occurred, such right of the holders of shares of PRIDES to elect two
Preferred Stock Directors separately as a class shall cease, subject always to
the same provisions for the vesting of such right of the holders of the shares
of PRIDES to elect two Preferred Stock Directors in the case of future dividend
defaults.
The term of office of each Director elected pursuant to the preceding
paragraph shall terminate on the earlier of (i) the next annual meeting of
stockholders at which a successor shall have been elected and qualified or (ii)
the termination of the right of the holders of shares of PRIDES and such other
series of Preferred Stock to vote for Directors pursuant to the preceding
paragraph. Vacancies on the Board of Directors resulting from the death,
resignation or other cause of any such Director shall be filled exclusively by
no less than two-thirds of the remaining Directors and the Director so elected
shall hold office until a successor is elected and qualified.
(c) For as long as any shares of PRIDES remain outstanding, the
affirmative consent of the holders of at least two-thirds thereof actually
voting (voting separately as a class) given in person or by proxy, at any
annual meeting or special meeting of the shareholders called for such purpose,
shall be necessary to (i) amend, alter or repeal any of the provisions of the
Articles of Incorporation of the Corporation which would adversely affect the
powers, preferences or rights of the holders of the shares of PRIDES then
outstanding or reduce the minimum time required for any notice to which holders
of shares of PRIDES then outstanding may be entitled; provided, however, that
any such amendment, alteration or repeal that would authorize, create or
increase the authorized amount of any additional shares of Junior Stock or any
other shares of stock (whether or not already authorized) ranking on a parity
with the shares of PRIDES shall be deemed not to adversely affect such powers,
preferences or rights and shall not be subject to approval by the holders of
shares of PRIDES; and provided further that clause (i) shall not be applicable
to the amendment, alteration or repeal of any provisions of the Articles of
Incorporation of the Corporation approved at a meeting of the shareholders the
record date of which is prior to the issuance of any shares of PRIDES; (ii)
authorize or create, or increase the authorized amount of, any capital stock,
or any security convertible into capital stock, of any class ranking senior to
PRIDES as to payment of dividends or the distribution of assets upon
liquidation, dissolution or winding up of the Corporation; or (iii) merge or
consolidate with or into any other corporation, unless each holder of the
shares of PRIDES immediately preceding such merger or consolidation shall have
the right either to (A) receive or continue to hold in the resulting
corporation the same number of shares, with substantially the same rights and
preferences, as correspond to the shares of PRIDES so held or (B) convert into
shares of Common Stock at the Common Equivalent Rate in effect on the date
immediately preceding the announcement of any such merger or consolidation.
There is no limitation on the issuance by the Corporation of Parity
Preferred Stock or of any class ranking junior to the shares of PRIDES.
Notwithstanding the provisions summarized in the preceding two
paragraphs, however, no such approval described therein of the holders of the
shares of PRIDES shall be required to authorize an
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increase in the number of authorized shares of Preferred Stock or if, at or
prior to the time when such amendment, alteration, or repeal is to take effect
or when the authorization, creation or increase of any such senior stock or
security is to be made, or when such consolidation or merger, liquidation,
dissolution or winding up is to take effect, as the case may be, provision is
made for the redemption of all shares of PRIDES at the time outstanding.
ARTICLE IV
No shareholder of this Corporation shall by reason of his holding
shares of any class have any pre-emptive or preferential right to subscribe to
or to purchase any additional or increased stock of any class of this
Corporation, whether now or hereafter authorized, or obligations convertible
into any other class or classes, or obligations, stock or other securities
carrying warrants or rights to subscribe to stock of this Corporation of any
class or classes (whether now or hereafter authorized); and any and all shares
of stock, bonds, debentures, notes, or other securities or obligations of this
Corporation, whether or not convertible into stock or carrying warrants or
options entitling its holders to subscribe to stock, may be issued, sold and
disposed of from time to time by the Board of Directors to such persons, firms
or corporations, and for such consideration as it shall from time to time in
its absolute discretion, determine, without offering any of the increased or
additional stock, bonds, debentures, notes, or other securities or obligations
of any class to existing shareholders of any class or to existing holders of
warrants or options entitling the holders to subscribe to stock of any class or
to obligations which may be converted into stock of any class.
ARTICLE V
Section 1. All the corporate powers of the Corporation shall be
vested in and exercised by a Board of Directors consisting of the number of
directors specified in, or determined in the manner prescribed in, the by-laws
of the Corporation.
Section 2. The Board of Directors may provide in the by-laws of
the Corporation, or by resolution, for the appointment by it of an Executive
Committee which shall have all of the powers of the Board. Whenever the Board
of Directors is not in session, the Executive Committee shall have
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complete authority to manage the business and affairs of this Corporation and
any action taken by the Executive Committee shall be valid and binding as
though decided by the Board of Directors, subject only to such limitations as
may be fixed in the by-laws or resolution.
Section 3. The by-laws of the Corporation may be made, altered,
amended, changed, waived or repealed, and new by-laws may be adopted, by the
Board of Directors at any regular or special meeting by the affirmative vote of
a majority of those directors present at any meeting of the directors; subject,
however, to the right of the shareholders to alter, amend, change, waive or
repeal any by-laws made or amended by the directors. The by-laws may contain
any provision relating to the business of the Corporation, the conduct of its
affairs, its rights or powers, or the rights or powers of its shareholders,
directors or officers, not inconsistent with law or these Articles of
Incorporation, as heretofore or hereafter amended. Notwithstanding the
foregoing, Sections 2.2, 2.3, 2.8, 4.1, 4.13 and 4.16 and Subsection 4.9.2 of
the Corporation's by-laws, as amended by the Board of Directors on and
effective as of January 31, 1995, may not be amended, altered, changed, waived
or repealed, directly or indirectly, nor may any provision inconsistent with
such Sections be adopted, except by the affirmative vote of the holders of no
less than 80% of the total voting power of all shares of the Corporation
entitled to vote generally in the election of directors, voting together as a
single class. Further, any other provisions of these Articles of Incorporation
or the by-laws notwithstanding (and in addition to any other vote that may be
required by law, these Articles of Incorporation or the by-laws), there shall
be required to amend, alter, change, waive or repeal, directly or indirectly,
or to adopt any provision inconsistent with, this Section 3 of Article V the
affirmative vote of the holders of no less than 80% of the total voting power
of all shares of the Corporation entitled to vote generally in the election of
directors, voting together as a single class.
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ARTICLE VI
Section 1. Except as may be otherwise required by statute, these
Articles may be amended by a majority vote of the shares present or
represented, taken at an annual or special meeting of shareholders, the notice
of which shall set forth the proposed amendment or a summary of the changes to
be made thereby.
ARTICLE VII
Section 1. Notwithstanding any other provisions of these
Articles of Incorporation and except as set forth in Section 5 of this Article
VII, the affirmative vote or consent of the holders of at least 80% of the
outstanding shares of all stock of the Corporation, considered for the purposes
of this Article VII as one class and hereinafter in this Article VII embraced
in the term "voting stock", shall be required for:
(i) a merger or consolidation of the Corporation with or
into any other corporation;
(ii) any sale or lease of all or substantially all of the
assets of the Corporation to any other corporation, person or other
entity;
(iii) any sale or lease to the Corporation or any
subsidiary thereof of any assets (except assets having an aggregate
fair market value of less than $1,000,000) in exchange for voting
stock (or securities convertible into or exchangeable for voting stock
or options, warrants or rights to purchase voting stock or securities
convertible into voting stock) of the Corporation or any subsidiary of
the Corporation by any other corporation, person or entity, if, as of
the record date for the determination of stockholders entitled to
notice thereof and to vote thereon or consent thereto, or as of the
time the Board of Directors shall have approved a memorandum of
understanding, or the Corporation shall have entered into any
agreement,with respect to any such transaction for which the vote or
consent of the holders of any class of stock of the Corporation is
otherwise required by law, these Articles of Incorporation or any
other contract or agreement, such other corporation, person or entity
which is a party to such a transaction is the beneficial owner,
directly or indirectly, of 10% or more of the outstanding shares of
the voting stock. Such affirmative vote or consent shall be in
addition to the vote or consent of the holders of any class of stock
of the Corporation otherwise required by law or these Articles of
Incorporation or the resolution, or resolutions providing for the
issuance of such class which have been adopted by the Board of
Directors or any agreement between the Corporation and any securities
exchange.
Section 2. In the event that the holders of the voting stock are
entitled to vote on any reclassification of securities, recapitalization or
other transaction (except redemptions permitted by the terms of the security
redeemed or repurchases of the securities for cancellation or the Corporation's
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treasury) designed to decrease the number of holders of the Corporation's
common stock remaining after any person has acquired 10% or more of the voting
stock of the Corporation, the favorable vote or consent of the holders of not
less than 80% of the voting stock shall be required for the approval of any
such action. Such affirmative vote or consent shall be in addition to the vote
or consent of the holders of any class of stock of the Corporation otherwise
required by law or these Articles of Incorporation or the resolution or
resolutions providing for the issuance of such class which have been adopted by
the Board of Directors or any agreement between the Corporation and any
securities exchange.
Section 3. Solely for the purpose of determining whether any
other corporation, person or entity is a party to or is the beneficial owner of
10% or more of the outstanding shares of voting stock, that corporation, person
or other entity shall be deemed to be the beneficial owner of any shares of
voting stock:
(i) which it owns directly, whether or not of record;
(ii) which it has the right to acquire pursuant to any
agreement or understanding or upon exercise of conversion rights,
exchange rights, warrants or options or otherwise;
(iii) which are beneficially owned, directly or indirectly
(including shares deemed to be owned through application of clause
(ii) above), by any "affiliate" or "associate" as those terms are
defined in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934 as in effect on May 17, 1982; or
(iv) which are beneficially owned, directly or indirectly
(including shares deemed to be owned through application of clause
(ii) above), by any other corporation, person or entity with which it
or its "affiliate" or "associate" has any agreement or understanding
for the purpose of acquiring, holding, voting or disposing of voting
stock.
Solely for the purpose of determining whether such other corporation,
person or entity which is a party to such a transaction is the beneficial owner
of 10% or more of the outstanding shares of voting stock, the outstanding
shares of voting stock shall be deemed to include shares deemed to be
beneficially owned by such other corporation, person or entity pursuant to the
provisions of the immediately preceding paragraph.
As used in this Article VII, the term "subsidiary" shall mean a
corporation a majority of the voting power of the capital stock (that is,
voting power entitled to be exercised in the election of directors, but
excluding voting power entitled so to be exercised only upon the happening of
some
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contingency unless such contingency shall have occurred and is continuing) of
which shall be owned by the Corporation or by one or more subsidiaries or by
the Corporation and one or more subsidiaries.
Section 4. For the purposes of this Article VII, the Board of
Directors shall have the power and duty to determine, on the basis of
information known to the Corporation at the time of such determination, whether
(i) such other corporation, person or other entity
beneficially owned 10% or more of the outstanding shares of the voting
stock;
(ii) a corporation, person or entity is an "affiliate" or
"associate" (as defined in Paragraph C above) of another;
(iii) the assets being acquired by the Corporation, or any
subsidiary thereof, have an aggregate fair market value of less than
$1,000,000; and
(iv) the memorandum of understanding referred to in
Section 5 below is substantially consistent with the transaction
covered thereby.
Any such determination shall be conclusive and binding for all purposes of this
Article VII.
Section 5. The provisions of Section 1 of this Article VII shall
not apply to:
(i) any merger or consolidation of the Corporation with
or into any other corporation, or any sale or lease to the Corporation
or any subsidiary thereof of any assets of, or any sale or lease by
the Corporation or any subsidiary thereof of any of its assets to, any
other corporation, person or entity, if the Board of Directors of the
Corporation has approved a memorandum of understanding with such other
corporation, person or entity with respect to such transaction prior
to the time that such other corporation, person or entity shall have
become a beneficial owner of 10% or more of the outstanding shares of
voting stock; or
(ii) any merger or consolidation of the Corporation with
or into, or any sale or lease to the Corporation or any subsidiary
thereof of any assets of, or any sale or lease by the Corporation or
any subsidiary thereof of any of its assets to, any corporation 50% or
more of the outstanding stock of which is beneficially owned, directly
or indirectly, by the Corporation.
Section 6. The Corporation shall have the right, subject to any
express provisions or restrictions contained in these Articles of Incorporation
or the by-laws, from time to time to amend the Articles of Incorporation or any
provision thereof in any manner now or hereafter provided by law, and all
rights and powers at any time conferred upon the directors or shareholders of
the Corporation by these Articles of Incorporation or any amendment thereof are
subject to such right of the Corporation.
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Section 7. Notwithstanding any other provision of these Articles
of Incorporation or the by-laws (and in addition to any other vote that may be
required by law, these Articles of Incorporation or the by-laws), there shall
be required to amend, alter, change or repeal, directly or indirectly, this
Article VII the affirmative vote or consent of the holders of 80% of the voting
stock of the Corporation.
Section 8. Except as otherwise required by statute or these
Articles of Incorporation, an agreement of merger or consolidation may be
approved by a majority vote of the shares present or represented taken at a
meeting called for the purpose of such approval.
ARTICLE VIII
Section 1. Cash, property or share dividends, shares issuable to
shareholders in connection with a reclassification of stock, and the redemption
price of redeemed shares, which are not claimed by the shareholders entitled
thereto within one year after the dividend or redemption price became payable
or the shares became issuable, despite reasonable efforts by the Corporation to
pay the dividend or redemption price or deliver the certificates for the shares
to such shareholders within said one year, shall, at the expiration of said one
year, revert in full ownership to the Corporation, and the Corporation's
obligation to pay such dividend or redemption price or issue such shares, as
the case may be, shall thereupon cease; provided that the Board of Directors
may, at any time, for any reason satisfactory to it, but need not, authorize
(a) the payment of the amount of such redemption price or any cash or property
dividend or (b) the issuance of any shares, ownership of which has reverted to
the Corporation pursuant to this Article, to the entity that would be entitled
thereto had such reversion not occurred.
ARTICLE IX
The Corporation is to have perpetual existence.
ARTICLE X
The private property of the shareholders shall not be subject to the
payment of corporate debts to any extent whatsoever.
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ARTICLE XI
The Corporation reserves the right to amend, alter, change or repeal
any provision contained in these Articles of Incorporation, in the manner now
or hereafter prescribed by the Louisiana Business Corporation Law, as it may be
amended, or any other applicable law, and all rights conferred upon
shareholders herein are granted subject to this reservation.
ARTICLE XII
No action shall be taken by the shareholders of the Corporation except
at an annual or special meeting of shareholders of the Corporation. A special
meeting of the shareholders of the Corporation may be called by the
shareholders, but only by a written request therefor, stating the purpose or
purposes thereof, delivered to the secretary of the Corporation and signed by
the holders of no less than 66 2/3% of the total voting power of all shares of
the Corporation entitled to vote generally in the election of directors, voting
together as a single class. Notwithstanding any other provision of these
Articles of Incorporation or the by-laws (and in addition to any other vote
that may be required by law, these Articles of Incorporation or the by-laws),
there shall be required to amend, alter, change, waive or repeal, directly or
indirectly, or to adopt any provision inconsistent with, this Article XII the
affirmative vote of the holders of no less than 80% of the total voting power
of all shares of the Corporation entitled to vote generally in the election of
directors, voting together as a single class.
ARTICLE XIII
Section 1. This Corporation shall indemnify to the full extent
from time to time permitted by law any person who was or is a party or is
threatened to be made a party to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (including any action by or in the
right of the Corporation) by reason of the fact that he is or was a director or
officer of this Corporation, or is or was, while a director or officer of this
Corporation, serving at the request of this Corporation as a director, officer,
employee or agent of another business, foreign or non-profit corporation,
partnership,
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joint venture or other enterprise ("Related Entity"), including indemnification
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with each
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of this
Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful; provided that in case of
actions by or in the right of this Corporation, the indemnity shall be limited
to expenses (including attorneys' fees and amounts paid in settlement not
exceeding in the judgment of the Board of Directors, the estimated expense of
litigating the action to conclusion) actually and reasonably incurred in
connection with the defense or settlement of such action and 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 negligence or misconduct in the
performance of his duty to this Corporation unless and only to the extent that
the court shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, he is fairly and
reasonably entitled to indemnity for such expenses which the court shall deem
proper. 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 reasonably believed to be in or not opposed to
the best interests of this Corporation, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that his conduct was
unlawful. The foregoing right of indemnification shall inure to each such
director or officer, whether or not he is such director or officer at the time
such costs or expenses are imposed or incurred, and whether or not the claim
asserted against him is based on matters which antedate the adoption of this
Article. With respect to the indemnification provided herein to a person who
is or was an officer or director of this Corporation and who is or was serving
at the request of this Corporation as a director, officer, employee or agent of
a Related Entity, the amount of expenses, judgments, fines, and settlement
payments payable hereunder shall be reduced
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by and to the extent of any amounts which may be collected by him from such
Related Entity. The foregoing provisions of this Section 1 shall be deemed to
be a contract between this Corporation and each officer and director who serves
in such capacity at any time while this Article is in effect, and any repeal or
modification thereof shall not affect any rights or obligations then existing,
with respect to any state of facts then or theretofore existing, or any action,
suit, or proceeding theretofore or thereafter brought or threatened based in
whole or in part upon any such state of facts.
Section 2. To the extent that a director or officer of this
Corporation has been successful on the merits or otherwise in defense of any
such action, suit or proceeding, or in defense of any claim, issue or matter
therein, he shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection therewith.
Section 3. Any indemnification under Section 1 of this Article
(unless ordered by the Court) shall be made by this Corporation only as
authorized in a specific case upon a determination that the applicable standard
of conduct has been met. Such determination shall be made in good faith and
promptly upon request by the person seeking indemnification (1) 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 (2) if such a quorum is not
obtainable or a quorum of disinterested directors so directs, by independent
legal counsel, or (3) by the shareholders.
Section 4. Expenses incurred in defending such an action, suit
or proceeding shall be paid by this Corporation in advance of the final
disposition thereof if authorized by the Board of Directors in the manner
provided in Section 3 of this Article, upon receipt of an undertaking by or on
behalf of the director or officer to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by this
Corporation as authorized in this Section. Such authorization shall be
provided promptly upon receipt of the said undertaking from the person seeking
payment of such expenses.
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Section 5. This Corporation may indemnify to the full extent
from time to time permitted by law any person who was or is a party or is
threatened to be made a party to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (including any action by or in the
right of the Corporation) by reason of the fact that he is or was an employee
or agent of this Corporation, or is or was serving at the request of this
Corporation as an employee or agent of another business, foreign or non-profit
corporation, partnership, joint venture or other enterprise.
Section 6. The indemnification provided by this Article shall
not be deemed exclusive of any other rights to which the person indemnified may
be entitled under any by-law, agreement, authorization of shareholders or
disinterested director or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of his heirs and legal representatives.
Section 7. This Corporation shall have power to procure
insurance on behalf of any person who is or was a director, officer, employee
or agent of this Corporation, or is or was serving at the request of this
Corporation as a director, officer, employee or agent of a Related Entity
against any liability asserted against or incurred by him in any such capacity,
or arising out of his status as such, whether or not this Corporation would
have the power to indemnify him against such liability under the provisions of
this Article.
ARTICLE XIV
Section 1. It is hereby declared to be a proper corporate
purpose, reasonably calculated to benefit shareholders, for the Board of
Directors to base the response of the Corporation to any "Acquisition Proposal"
on the Board of Directors' evaluation of what is in the best interests of the
Corporation, and in making such evaluation to consider:
(i) the best interests of the shareholders, including
among other factors, not only the value of the consideration being
offered in the Acquisition Proposal, in relation to the then
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current value of the Corporation in a freely negotiated transaction
and in relation to the Board of Directors' then estimate of the future
value of the Corporation as an independent entity;
(ii) such other factors as the Board of Directors
determines to be relevant, including, among other factors, the social,
legal and economic effects upon the franchisees, employees, suppliers,
customers, creditors and business of the Corporation and its
subsidiaries;
(iii) the financial condition and earnings prospects of the
party making the Acquisition Proposal, including, but not limited to,
debt service and other existing or likely financial obligations of the
party making the Acquisition Proposal, and the possible effect of such
condition upon the Corporation and its subsidiaries and the
communities in which the Corporation and its subsidiaries operate or
are located; and
(iv) the competence, experience and integrity of the party
making the Acquisition Proposal.
"Acquisition Proposal" means any proposal of any person (a) to tender for or
exchange cash or securities for any equity security of the Corporation, (b) to
merge or consolidate the Corporation with another corporation, and (c) to
purchase or otherwise acquire all or substantially all of the properties and
assets of the Corporation.
Section 2. Notwithstanding any other provision of these Articles
of Incorporation or the by-laws (and in addition to any other vote that may be
required by law, these Articles of Incorporation or the by-laws), there shall
be required to amend, alter, change or repeal, directly or indirectly, this
Article XIV the affirmative vote or consent of the holders of 80% of the voting
stock of the Corporation.
ARTICLE XV
No director of officer of this Corporation shall be personally liable
to this Corporation or its shareholders for monetary damages for breach of
fiduciary duty as a director or officer, except for liability (i) for breach of
the director's or officer's duty of loyalty to this Corporation or its
shareholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 92(D)
of the Louisiana Business Corporation Law, or (iv) for any transaction from
which the director or officer derives an improper personal benefit. If the
Louisiana Business Corporation Law is hereafter amended to authorize corporate
action further limiting or eliminating the personal liability of directors and
officers, then the liability of each director and officer of this
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Corporation shall be limited or eliminated to the full extent permitted by the
Louisiana Business Corporation Law as so amended from time to time. Neither
the amendment nor repeal of this Article XV, nor the adoption of any provision
of this Corporation's Articles of Incorporation inconsistent with this Article
XV shall eliminate or reduce the effect of this Article XV, in respect of any
matter occurring, or any cause of action, suit or claim that, but for this
Article XV, would accrue or arise, prior to such amendment, repeal or adoption
of an inconsistent provision.
This Restatement of the Articles of Incorporation of United Companies
Financial Corporation is executed as of this 11th day of November, 1996, by the
undersigned duly authorized officers of the Corporation in the presence of the
undersigned competent witnesses.
UNITED COMPANIES FINANCIAL
WITNESSES: CORPORATION
/s/ JOHNETTE DRAGO By: /s/ JOHN D. DIENES
- ----------------------------- ---------------------------------
John D. Dienes, President and
Chief Operating Officer
/s/ ANNE YAUBE
- -----------------------------
By: /s/ SHERRY E. ANDERSON
---------------------------------
Sherry E. Anderson, Secretary
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STATE OF LOUISIANA
PARISH OF EAST BATON ROUGE
The undersigned, a Notary Public duly qualified and commissioned in
and for the Parish and State aforesaid, do hereby certify that on the 19th day
of November, 1996, personally appeared before me, John D. Dienes and Sherry E.
Anderson, who, being first duly sworn by me declared that they are the
President and Secretary respectively, of United Companies Financial
Corporation; that they signed this document as President and Secretary of that
Corporation and that the statements contained therein are true.
/s/ J. MICHAEL ROBINSON, JR.
-----------------------------------
Notary Public
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