L:\secfiles\8-k\1996\6-96cov.doc
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported) June 7, 1996
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GENERAL MOTORS CORPORATION
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(Exact name of registrant as specified in its charter)
STATE OF DELAWARE 1-143 38-0572515
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
767 Fifth Avenue, New York, New York 10153-0075
3044 West Grand Boulevard, Detroit, Michigan 48202-3091
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (313)-556-5000
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<PAGE>
ITEM 5. OTHER EVENTS
On June 7, 1996, General Motors Corporation (GM) issued a news
release announcing that the split-off of Electronic Data Systems
Corporation (EDS) from GM had been approved by GM's common stockholders
and is effective immediately. The content of the news release was as
follows:
EDS SPLIT-OFF FROM GM COMPLETED TODAY
NEW YORK -- General Motors Corporation and EDS (Electronic Data
Systems) announced that the split-off of EDS from General Motors was
completed today after receiving the requisite vote from GM
stockholders. Stockholders also voted to approve the "Amended
Incentive Plan" for EDS.
EDS common stock will begin trading on the New York Stock Exchange on
Monday, June 10, 1996, under the symbol "EDS." The stock will also
trade on the London Stock Exchange beginning on June 11, 1996. GM
Class E common stock will cease trading on the New York Stock Exchange
at the close of business today. Each share of GM Class E common stock
will be exchanged for one share of EDS common stock.
In August 1995, GM announced it was pursuing a split-off of EDS to
holders of GM's Class E common stock in a tax-free transaction. In
December, GM announced that it had received a ruling from the U.S.
Internal Revenue Service stating that the contemplated split-off would
be tax free to GM and its common stockholders for U.S. federal income
tax purposes. In April 1996, GM announced that its Board of Directors
had approved a proposal for the EDS split-off subject to obtaining
consent of GM stockholders.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
Exhibit 3(i) Restated Certificate of Incorporation as amended to June
7, 1996, reflecting amendments to Article Fourth resulting from the
split-off of EDS from GM.
Section Amendment
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Introductory paragraph
to ARTICLE FOURTH Amended to reduce the total authorized
capital stock and common stock of the
Corporation from 3,706,000,000 to
2,706,000,000 shares and from
3,600,000,000 to 2,600,000,000 shares,
respectively, and to delete Class E
Common Stock from the listing of
authorized capital stock.
DIVISION I:
Heading and Introduction Amended to delete reference to the Class
E Common Stock.
DIVISION I: (a)(1)
Dividends on Common Stock Amended to delete references to "paid in
surplus attributable to Class E Common
Stock" and "the portion of earned surplus
of the Corporation attributable to the
Available Separate Consolidated Net
Income of EDS earned since the date of
acquisition by the Corporation of EDS",
and to change the reference of Hughes
Electronics Corporation from "GMHE" to
"Hughes".
- 2 -
DIVISION I: (a)(2)
Dividends on Class E
Common Stock Deleted provisions regarding the payment
of dividends on Class E Common Stock.
DIVISION I: (a)(3)
Dividends on Class H
Common Stock Amended to reflect new reference as
DIVISION I: (a)(2) Dividends on Class H
Common Stock, to delete the reference to
paid in surplus attributable to Class E
Common Stock and to change the "GMHE"
reference to "Hughes".
DIVISION I: (a)(4)
Discrimination Among Common
Stock, Class E Common Stock
and Class H Common Stock Amended to reflect new reference as
Division I: (a) (3) Discrimination
Between Common Stock and Class H Common
Stock, to delete the reference to Class E
Common Stock and change references
regarding "holders of two or more such
classes" to "both such classes".
DIVISION I: (a)(5)
Available Separate Consolidated
Net Income of EDS Amended to reflect new reference as
Division I: (a) (4) Available Separate
Consolidated Net Income of EDS and to
specify that the meaning of Available
Separate Consolidated Net Income of EDS
relates to any period during which EDS
was a direct or indirect wholly-owned
subsidiary of the Corporation.
DIVISION I: (a)(6)
Available Separate Consolidated
Net Income of GMHE Amended to reflect new reference as
Division I: (a) (5) Available Separate
Consolidated Net Income of Hughes and
change "GMHE" references to "Hughes".
DIVISION I: (b)
Voting Rights Amended to delete references relating to
Class E Common Stock; the separate
voting rights of holders of Class E
Common Stock in relation to matters
which adversely affect the rights,
powers or privileges of the Class E
Common Stock; stockholder approval
requirements for increasing the number
of authorized shares of Class E Common
Stock and; Class E Common Stock voting
rights of one quarter (0.25) for each
Share of Class E Common Stock standing
in a holders name on the stock transfer
books of the Corporation and to update
subparagraph references within Division
I: (b) Voting Rights.
DIVISION I: (c)(1) Deleted provisions relating to
exchangeability of Class E Common Stock.
DIVISION I: (c)(2) Amended to reflect new reference as
Division I: (c)(1) and to change "GMHE"
references to "Hughes" and to update
references to other sections of Article
Fourth.
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DIVISION I: (c)(3) Deleted provisions relating to the
Class'E Common Stock pay-out ratio.
DIVISION I: (c)(4) Amended to reflect new reference as
Division I: (c)(2), to reflect that the
Available Separate Consolidated Net
Income of EDS relates to any portion of
a fiscal year during which EDS was a
direct or indirect wholly-owned
subsidiary of the Corporation, and to
change "GMHE" references to "Hughes".
DIVISION I: (c)(5) Deleted provision relating to the
exchange of Class E Common Stock in the
event of a sale, transfer, or other
disposition of the business of EDS.
DIVISION I: (c)(6) Amended to reflect new reference as
Division I: (c)(3) and to change "GMHE"
references to "Hughes" and to update
references to other sections of Article
Fourth.
DIVISION I: (c)(7) Amended to reflect new reference as
Division I: (c)(4) and to delete
references to Class E Common Stock and
to update references to other sections
of Article Fourth.
DIVISION I: (c)(8) Deleted provision relating to the
computation of the Exchange Rate for
Class E Common Stock.
DIVISION I: (c)(9) Amended to reflect new reference as
Division I: (c)(5) and to update
references to other sections of Article
Fourth.
DIVISION I: (c)(10) Amended to reflect new reference as
Division I: (c)(6), to delete references
to Class E Common Stock and to update
references to other sections of Article
Fourth.
DIVISION I: (c)(11) Amended to reflect new reference as
Division I: (c)(7), and to delete
references to Class E Common Stock.
DIVISION I: (c)(12) Amended to reflect new reference as
Division I: (c)(8), to delete references
to Class E Common Stock and to update
references to other sections of Article
Fourth.
DIVISION I: (c)(13) Amended to reflect new reference as
Division I: (c) (9), and to delete
references to Class E Common Stock.
DIVISION I: (c)(14) Amended to reflect new reference as
Division I: (c) (10), to delete
references to Class E Common Stock and
to update references to other sections
of Article Fourth.
DIVISION I: (c)(15) Amended to reflect new reference as
Division I: (c) (11), and to delete
references to Class E Common Stock.
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DIVISION I: (c)(16) Amended to reflect new reference as
Division I: (c) (12), and to delete
references to Class E Common Stock.
DIVISION I: (d)
Liquidation Rights Amended to delete references to Class E
Common Stock and Class E Common Stock
liquidation units of one quarter (0.25)
per share.
DIVISION I: (e)
Subdivision or Combination Amended to delete references to Class E
Common Stock and to delete the first
paragraph following (2) (B) regarding
adjustments to liquidation rights
associated with the first dividend of
Class H Common Stock prior to September
16, 1986.
DIVISION II:
Preferred Stock -
1st paragraph Deleted section referring to "a
statement of the provisions in these
respects of the Preferred Stock - $5
Series and the Preferred Stock - $3.75
Series".
DIVISION II:
Preferred Stock -
2nd paragraph, 3rd
paragraph and 4th
paragraph Deleted references to the Preferred
Stock - $5 Series and the Preferred
Stock - $3.75 Series.
DIVISION II:
Preferred Stock -
7th paragraph Deleted references to Class E Common
Stock.
DIVISION II:
Preferred Stock -
8th paragraph Deleted references to Class E Common
Stock and certain dividend provisions
relating to Preferred Stock.
DIVISION II:
Preferred Stock -
Last two paragraphs Deleted provisions relating to changes
in voting power associated with
Preferred Stock in certain
circumstances.
DIVISION IV:
Miscellaneous -
1st paragraph Deleted references to Class E Common
Stock and the Preferred Stock issuance
restrictions.
DIVISION IV:
Miscellaneous -
2nd paragraph Amended to change the references of the
amount to be paid to holders of
Preferred Stock in the event of any
liquidation or dissolution from $100.00
per share to "the redemption price" and
to delete references to Class E Common
Stock.
DIVISION IV:
Miscellaneous -
Penultimate paragraph Deleted references to Class E Common
Stock
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Exhibit 3(ii) By-Laws as amended to June 7, 1996, reflecting amendments
to Section 3.10 resulting from the split-off of EDS from GM.
Section Amendment
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3.10
Capital Stock Committee Amended to delete reference to Electronic
Data Systems Corporation (EDS), to change
the reference for GM Hughes Electronics
Corporation (GMHE) to Hughes Electronics
Corporation (Hughes) and to delete
reference to business and financial
relationships between EDS and Hughes.
SIGNATURE
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.
GENERAL MOTORS CORPORATION
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(Registrant)
Date June 10, 1996
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By
s/Wallace W. Creek
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(Wallace W. Creek, Comptroller)
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EXHIBIT 3(i)
G E N E R A L M O T O R S C O R P O R A T I O N
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RESTATED
CERTIFICATE OF INCORPORATION
As Amended to
June 7, 1996
i
<PAGE>
GENERAL MOTORS CORPORATION
RESTATED
CERTIFICATE OF INCORPORATION
As Amended
June 7, 1996
INDEX
ARTICLE FIRST........................................................ 1
ARTICLE SECOND....................................................... 1
ARTICLE THIRD........................................................ 1
ARTICLE FOURTH....................................................... 2
DIVISION I: COMMON STOCK AND CLASS H COMMON STOCK........... 3
(a) Dividend Rights.................................... 3
(1) Dividends on Common Stock..................... 3
(2) Dividends on Class H Common Stock............. 3
(3) Discrimination Between Common Stock
and Class H Common Stock...................... 4
(4) Available Separate Consolidated Net
Income of EDS................................. 4
(5) Available Separate Consolidated Net
Income of Hughes.............................. 5
(b) Voting Rights...................................... 5
(c) Exchangeability.................................... 6
(d) Liquidation Rights................................. 9
(e) Subdivision or Combination......................... 9
DIVISION II: PREFERRED STOCK...............................10
DIVISION III: PREFERENCE STOCK..............................12
DIVISION IV: MISCELLANEOUS.................................13
ARTICLE FIFTH........................................................14
ARTICLE SIXTH........................................................14
ARTICLE SEVENTH......................................................14
ARTICLE EIGHTH.......................................................16
ARTICLE NINTH........................................................16
ii
<PAGE>
GENERAL MOTORS CORPORATION
Restated
Certificate of Incorporation
As Amended
June 7, 1996
ARTICLE FIRST
The name of the Corporation is
GENERAL MOTORS CORPORATION
ARTICLE SECOND
The registered office of the Corporation shall be located at 1209 Orange
Street, in the City of Wilmington, County of New Castle, State of Delaware.
The name of its registered agent in charge thereof is The Corporation Trust
Company, 1209 Orange Street, in the City of Wilmington, County of New Castle,
State of Delaware.
ARTICLE THIRD
The nature of the business of the Corporation and the objects and purposes
proposed to be transacted, promoted, or carried on by it, are as follows,
to-wit:
(a) To manufacture, buy, sell and deal in automobiles, trucks, cars, boats,
flying machines and other vehicles, their parts and accessories, and kindred
articles, and generally to conduct an automobile business in all its branches.
(b) To purchase or otherwise acquire, lease, assign, mortgage, pledge or
otherwise dispose of any trade names, trade marks, concessions, inventions,
formulae, improvements, processes of any nature whatsoever, copyrights, and
letters patent of the United States and of foreign countries, and to accept
and grant licenses thereunder.
(c) To subscribe or cause to be subscribed for, and to purchase or otherwise
acquire, hold for investment, sell, assign, transfer, mortgage, pledge,
exchange, distribute or otherwise dispose of the whole or any part of the
shares of the capital stock, bonds, coupons, mortgages, deeds of trust,
debentures, securities, obligations, notes and other evidences of
indebtedness of any corporation, stock company or association, now or
hereafter existing, and whether created by or under the laws of the State of
Delaware, or otherwise; and while owners of any of said shares of capital
stock or bonds or other property to exercise all the rights, powers and
privileges of ownership of every kind and description, including the right to
vote thereon, with power to designate some person for that purpose from time
to time to the same extent as natural persons might or could do.
- 1 -
(d) To purchase, hold, sell and reissue the shares of its own capital stock.
(e) To buy, lease, or otherwise acquire, so far as may be permitted by law,
the whole or any part of the business, good-will, and assets of any person,
firm, association or corporation (either foreign or domestic) engaged in a
business of the same general character as that for which this Corporation is
organized.
(f) To endorse, guarantee and secure the payment and satisfaction of bonds,
coupons, mortgages, deeds of trust, debentures, securities, obligations and
evidences of indebtedness, and also to guarantee and secure the payment or
satisfaction of interest on obligations and of dividends on shares of the
capital stock of other corporations; also to assume the whole or any part of
the liabilities, existing or prospective, of any person, corporation, firm or
association; and to aid in any manner any other person or corporation with
which it has business dealings, or whose stocks, bonds, or other obligations
are held or are in any manner guaranteed by the Corporation, and to do any
other acts and things for the preservation, protection, improvement, or
enhancement of the value of such stocks, bonds, or other obligations.
(g) To engage in any other manufacturing or mercantile business of any kind
or character whatsoever, and to that end to acquire, hold, own and dispose of
any and all property, assets, stocks, bonds and rights of any and every kind.
(h) Without in any particular limiting any of the objects and powers of the
Corporation, it is hereby expressly declared and provided that the
Corporation shall have power to do all things herein before enumerated, and
also to issue or exchange stocks, bonds, and other obligations in payment for
property purchased or acquired by it, or for any other object in or about its
business; to borrow money without limit; to mortgage or pledge its
franchises, real or personal property, income and profits accruing to it, any
stocks, bonds or other obligations, or any property which may be acquired by
it, and to secure any bonds or other obligations by it issued or incurred.
(i) To carry on any business whatsoever which the Corporation may deem proper
or convenient in connection with any of the foregoing purposes or otherwise,
or which may be calculated, directly or indirectly, to promote the interests
of the Corporation or to enhance the value of its property; to conduct its
business in this State, in other States, in the District of Columbia, in the
Territories and Colonies of the United States, and in foreign countries; and
to hold, purchase, mortgage and convey real and personal property, either in
or out of the State of Delaware, and to have and to exercise all the powers
conferred by the laws of Delaware upon corporations formed under the act
pursuant to and under which this Corporation is formed.
ARTICLE FOURTH
The total authorized capital stock of the Corporation is as follows:
2,706,000,000 shares, of which 6,000,000 shares shall be Preferred Stock,
without par value ("Preferred Stock"), 100,000,000 shares shall be Preference
Stock, $0.10 par value ("Preference Stock"), and 2,600,000,000 shares shall
be Common Stock, of which 2,000,000,000 shares shall be Common Stock, $1-2/3
par value ("Common Stock"), and 600,000,000 shares shall be Class H Common
Stock, $0.10 par value ("Class H Common Stock").
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DIVISION I:
COMMON STOCK
AND CLASS H COMMON STOCK.
The Common Stock and the Class H Common Stock shall be identical in all
respects and shall have equal rights and privileges, except as otherwise
provided in this Article FOURTH. The relative rights, privileges and
restrictions of the shares of each class are as follows:
(a) Dividend Rights.
Subject to the express terms of any outstanding series of Preferred Stock
or Preference Stock, dividends may be paid in cash or otherwise upon the
Common Stock and the Class H Common Stock out of the assets of the
Corporation in the relationship and upon the terms provided for below with
respect to each such class:
(1) Dividends on Common Stock.
Dividends on Common Stock may be declared and paid only to the extent of
the assets of the Corporation legally available therefor reduced by an amount
equal to the sum of (A) the paid in surplus attributable to the Class H
Common Stock; and (B) that portion of the earned surplus of the Corporation
attributable to the Available Separate Consolidated Net Income of Hughes (as
defined in subparagraph (a)(5)) earned since the date of the acquisition by
the Corporation of Hughes Electronics Corporation, its subsidiaries and
successors ("Hughes"). Dividends declared and paid with respect to shares of
Common Stock and any adjustments to surplus resulting from either (i) the
repurchase or issuance of any shares of Common Stock or (ii) any other reason
deemed appropriate by the Board of Directors shall be subtracted from or
added to the amounts available for the payment of dividends on Common Stock.
Subject to the foregoing, the declaration and payment of dividends on the
Common Stock, and the amount thereof, shall at all times be solely in the
discretion of the Board of Directors of the Corporation.
(2) Dividends on Class H Common Stock
Dividends on the Class H Common Stock may be declared and paid only to
the extent of the assets of the Corporation legally available therefor
reduced by an amount equal to the sum of (A) the paid in surplus attributable
to the Common Stock; and (B) the earned surplus of the Corporation exclusive
of that portion of such earned surplus attributable to the Available Separate
Consolidated Net Income of Hughes earned since the date of the acquisition of
Hughes by the Corporation. Dividends declared and paid with respect to shares
of Class H Common Stock and any adjustments to surplus resulting from either
(i) the repurchase or issuance of any shares of Class H Common Stock or (ii)
any other reason deemed appropriate by the Board of Directors shall be
subtracted from or added to the amounts available for the payment of
dividends on Class H Common Stock. Subject to the foregoing, the declaration
and payment of dividends on the Class H Common Stock, and the amount thereof,
shall be at all times be solely in the discretion of the Board of Directors
of the Corporation.
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(3) Discrimination Between Common Stock and Class H Common Stock
The Board of Directors, subject to the provisions of subparagraphs (a)(1)
and (a)(2), may, in its sole discretion, declare dividends payable
exclusively to the holders of Common Stock, exclusively to the holders of
Class H Common Stock or to the holders of both such classes in equal or
unequal amounts, notwithstanding the respective amounts of surplus available
for dividends to each class, the respective voting and liquidation rights of
each class, the amount of prior dividends declared on each class or any other
factor.
(4) Available Separate Consolidated Net Income of EDS.
The "Available Separate Consolidated Net Income of EDS" for any period
during which Electronic Data Systems Corporation (together with its
subsidiaries and successors, "EDS") was a direct or indirect wholly-owned
subsidiary of the Corporation shall mean the separate net income of EDS on a
consolidated basis, determined in accordance with generally accepted
accounting principles without giving effect to any adjustment which would
result from accounting for the acquisition of EDS by the Corporation using
the purchase method, calculated for each quarterly accounting period and
multiplied by a fraction, the numerator of which shall be the weighted
average number of shares of Class E Common Stock outstanding during such
accounting period and the denominator of which shall initially be
121,888,889; provided, that such fraction shall in no event be greater than
one. The denominator of the foregoing fraction shall be adjusted from time to
time as deemed appropriate by the Board of Directors of the Corporation (i)
to reflect subdivisions (by stock split or otherwise) and combinations (by
reverse stock split or otherwise) of the Class E Common Stock and stock
dividends payable in shares of Class E Common Stock to holders of Class E
Common Stock, (ii) to reflect the fair market value of contributions of cash
or property by the Corporation to EDS or of cash or property of the
Corporation to, or for the benefit of, employees of EDS in connection with
employee benefit plans or arrangements of the Corporation or any of its
subsidiaries, (iii) to reflect the number of shares of capital stock of the
Corporation contributed to, or for the benefit of, employees of EDS in
connection with benefit plans or arrangements of the Corporation or any of
its subsidiaries, (iv) to reflect payments by EDS to the Corporation of
amounts applied to the repurchase by the Corporation of shares of Class E
Common Stock, and (v) to reflect the number of shares of Class E Common Stock
repurchased by EDS and no longer outstanding; provided, that in the case of
adjustments pursuant to clause (iv) or clause (v) above, adjustments shall be
made only to the extent that the Board of Directors of the Corporation, in
its sole discretion, shall have approved such repurchase of shares by the
Corporation or EDS and, in the case of clause (iv) above, shall declare such
payments by EDS to be applied to such repurchase. Any changes in the
numerator or denominator of the foregoing fraction occurring after the end of
a quarterly accounting period shall not result in an adjustment to the
Available Separate Consolidated Net Income of EDS for such quarterly
accounting period or any prior period. For all purposes, determination of the
Available Separate Consolidated Net Income of EDS shall be in the sole
discretion of the Board of Directors of the Corporation and shall be final
and binding on all stockholders of the Corporation.
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(5) Available Separate Consolidated Net Income of Hughes.
The Available Separate Consolidated Net Income of Hughes shall mean the
separate net income of Hughes on a consolidated basis, determined in
accordance with generally accepted accounting principles without giving
effect to any adjustment which would result from accounting for the
acquisition of Hughes by the Corporation using the purchase method,
calculated for each quarterly accounting period and multiplied by a fraction,
the numerator of which shall be the weighted average number of shares of
Class H Common Stock outstanding during such accounting period and the
denominator of which shall initially be 200,000,000; provided, that such
fraction shall in no event be greater than one. The denominator of the
foregoing fraction shall be adjusted from time to time as deemed appropriate
by the Board of Directors of the Corporation (i) to reflect subdivisions (by
stock split or otherwise) and combinations (by reverse stock split or
otherwise) of the Class H Common Stock and stock dividends payable in shares
of Class H Common Stock to holders of Class H Common Stock, (ii) to reflect
the fair market value of contributions of cash or property by the Corporation
to Hughes or of cash or property of the Corporation to, or for the benefit
of, employees of Hughes in connection with employee benefit plans or
arrangements of the Corporation or any of its subsidiaries, (iii) to reflect
the number of shares of capital stock of the Corporation contributed to, or
for the benefit of, employees of Hughes in connection with benefit plans or
arrangements of the Corporation or any of its subsidiaries, (iv) to reflect
payments by Hughes to the Corporation of amounts applied to the repurchase by
the Corporation of shares of Class H Common Stock, and (v) to reflect the
number of shares of Class H Common Stock repurchased by Hughes and no longer
outstanding; provided, that in the case of adjustments pursuant to clause
(iv) or clause (v) above, adjustments shall be made only to the extent that
the Board of Directors of the Corporation, in its sole discretion, shall have
approved such repurchase of shares by the Corporation or Hughes and, in the
case of clause (iv) above, shall declare such payments by Hughes to be
applied to such repurchase. Any changes in the numerator or denominator of
the foregoing fraction occurring after the end of a quarterly accounting
period shall not result in an adjustment to the Available Separate
Consolidated Net Income of Hughes for such quarterly accounting period or any
prior period. For all purposes, determination of the Available Separate
Consolidated Net Income of Hughes shall be in the sole discretion of the
Board of Directors of the Corporation and shall be final and binding on all
stockholders of the Corporation.
(b) Voting Rights.
The holders of Common Stock and Class H Common Stock shall vote together
as a single class on all matters; provided, however, that (i) the holders of
Common Stock voting separately as a class shall be entitled to approve by the
vote of a majority of the shares of Common Stock then outstanding any
amendment, alteration or repeal of any of the provisions of this Certificate
of Incorporation which adversely affects the rights, powers or privileges of
the Common Stock; (ii) the holders of Class H Common Stock voting separately
as a class shall be entitled to approve by the vote of a majority of the
shares of Class H Common Stock then outstanding any amendment, alteration or
repeal of any of the provisions of this Certificate of Incorporation which
adversely affects the rights, powers or privileges of the Class H Common
Stock; and (iii) any increase in the number of authorized shares of Class H
Common Stock shall be subject to approval by both (A) the holders of a
majority of the shares of Common Stock and Class H Common Stock then
- 5 -
outstanding, voting together as a single class based upon their respective
voting rights, and (B) the holders of a majority of the shares of Class H
Common Stock then outstanding, voting separately as a class. Subject to
adjustment pursuant to paragraph (e) hereof, each holder of Common Stock
shall be entitled to one vote, in person or by proxy, for each share of
Common Stock standing in his name on the stock transfer books of the
Corporation; and each holder of Class H Common Stock shall be entitled to
one-half (0.5) of a vote, in person or by proxy, for each share of Class H
Common Stock standing in his name on the stock transfer books of the
Corporation.
(c) Exchangeability.
(1) After December 31, 1995, the Board of Directors of the Corporation,
in its sole discretion and by a majority vote of the directors then in
office, may at any time effect a recapitalization of the Corporation by
declaring that all of the outstanding shares of Class H Common Stock shall be
exchanged for fully paid and nonassessable shares of Common Stock in
accordance with the Exchange Rate (as defined in subparagraph (c)(4));
provided, that the Board of Directors may effect such recapitalization only
if, during each of the five full fiscal years preceding such
recapitalization, the Board of Directors has declared and paid cash dividends
on the Class H Common Stock equal to or greater than the Class H Payout Ratio
for such year (as defined in subparagraph (c)(2)) multiplied by the Available
Separate Consolidated Net Income of Hughes for the prior fiscal year.
(2) For purposes of this paragraph (c) of Division I of this Article
FOURTH, the term "Class H Payout Ratio" shall mean, for any fiscal year, the
lesser of (A) 0.25 or (B) the quotient of (x) the total cash dividends paid
on the Common Stock in respect of such fiscal year, divided by (y) (i) the
consolidated net income of the Corporation and its subsidiaries for such
fiscal year minus (ii) the Available Separate Consolidated Net Income of EDS
for any portion of such fiscal year during which EDS was a direct or indirect
wholly owned subsidiary of the Corporation, minus (iii) the Available
Separate Consolidated Net Income of Hughes for such fiscal year; provided,
that nothing in this paragraph (c) shall be deemed to limit or restrict the
authority of the Board of Directors of the Corporation to declare and pay
dividends on Class H Common Stock and Common Stock at such times and in such
amounts as the Board of Directors in its sole discretion (subject to
paragraph (a)) may determine.
(3) In the event of the sale, transfer, assignment or other disposition
by the Corporation of substantially all of the business of Hughes Aircraft
Company, its subsidiaries and successors or of substantially all of the other
business of Hughes to a person, entity or group of which the Corporation is
not a majority owner (whether by merger, consolidation, sale of assets or
stock, liquidation, dissolution, winding up or otherwise), effective upon the
consummation of such sale, transfer, assignment or other disposition and
automatically without any action on the part of the Corporation or its Board
of Directors or on the part of the holders of shares of Class H Common Stock,
the Corporation shall be recapitalized and all outstanding shares of Class H
Common Stock shall be exchanged for fully paid and nonassessable shares of
Common Stock at the Exchange Rate (as defined in subparagraph (c)(4)).
(4) For purposes of this paragraph (c) of Division I of this Article
FOURTH, the term "Exchange Rate" applicable to the Class H Common Stock shall
mean the number of shares of Common Stock for which each share of Class H
- 6 -
Common Stock shall be exchangeable pursuant to subparagraphs (c)(1) and
(c)(3), as the case may be, of this paragraph (c) determined as follows: Each
share of Class H Common Stock shall be exchangeable for such number of shares
of Common Stock (calculated to the nearest five decimal places) as is
determined by dividing (A) the product resulting from multiplying (i) the
Average Market Price Per Share (as defined in subparagraph (c)(5)) of such
Class H Common Stock by (ii) 1.2, by (B) the Average Market Price Per Share
of Common Stock.
(5) For purposes of computing the Exchange Rate applicable to the Class H
Common Stock pursuant to this paragraph (c) of Division I of this Article
FOURTH, the Average Market Price Per Share of Common Stock or Class H Common
Stock, as the case may be, shall mean the average of the daily closing prices
per share for such Common Stock or Class H Common Stock for the fifteen (15)
consecutive trading days ending one (1) trading day prior to either (A) in
the case of an exchange pursuant to subparagraph (c)(1), the date the
Exchange Notice (as defined in subparagraph (c)(8)) is mailed or (B) in the
case of an exchange pursuant to subparagraph (c)(3), the date of the public
announcement by the Corporation or one of its subsidiaries of the first to
occur of the following: that the Corporation or one of its subsidiaries (1)
has entered into an agreement in principle with respect to such transaction
or (2) has entered into a definitive agreement with respect thereto. The
closing price for each day shall be the closing sales price as reported in
The Wall Street Journal or, if not reported therein, as reported in another
newspaper of national circulation chosen by the Board of Directors of the
Corporation or, in case no such sale takes place on such day, the average of
the closing bid and asked prices regular way on the New York Stock Exchange,
or if the Common Stock or Class H Common Stock is not then listed or admitted
to trading on the New York Stock Exchange, on the largest principal national
securities exchange on which such stock is then listed or admitted to
trading, or if not listed or admitted to trading on any national securities
exchange, then the last reported sale prices for such shares in the
over-the-counter market, as reported on the National Association of
Securities Dealers Automated Quotation System, or, if such sale prices shall
not be reported thereon, the average of the closing bid and asked prices so
reported, or, if such bid and asked prices shall not be reported thereon, as
the same shall be reported by the National Quotation Bureau Incorporated, or,
in all other cases, an appraised market value furnished by any New York Stock
Exchange member firm selected from time to time by the Board of Directors or
the Finance Committee of the Corporation for that purpose.
(6) No fraction of a share of Common Stock shall be issued in connection
with the exchange of shares of Class H Common Stock into Common Stock, but in
lieu thereof, each holder of Class H Common Stock who would otherwise be
entitled to a fractional interest of a share of Common Stock shall, upon
surrender of such holder's certificate or certificates representing shares of
Class H Common Stock, receive a cash payment (without interest) (the
"Fractional Payment") equal to the product resulting from multiplying (A) the
fraction of a share of Common Stock to which such holder would otherwise have
been entitled by (B) the Average Market Price Per Share of the Common Stock
on the Exchange Date (as defined in subparagraph (c)(8)).
(7) No adjustments in respect of dividends shall be made upon the
exchange of any shares of Class H Common Stock; provided, however, that if
the Exchange Date with respect to Class H Common Stock shall be subsequent to
the record date for the payment of a dividend or other distribution thereon
or with respect thereto but prior to the payment or distribution thereof, the
- 7 -
registered holders of such shares at the close of business on such record
date shall be entitled to receive the dividend or other distribution payable
on such shares on the date set for payment of such dividend or other
distribution notwithstanding the exchange of such shares or the Corporation's
default in payment of the dividend or distribution due on such date.
(8) At such time or times as the Corporation exercises it right to cause
all of the shares of Class H Common Stock to be exchanged for Common Stock in
accordance with subparagraph (c)(1) of this paragraph (c) of Division I of
this Article FOURTH and at such time as the Corporation causes the exchange
of such Class H Common Stock for Common Stock as a result of a sale,
transfer, assignment or other disposition of the type referred to in
subparagraph (c)(3) of this paragraph (c), the Corporation shall give notice
of such exchange to the holders of Class H Common Stock whose shares are to
be exchanged, by mailing by first-class mail a notice of such exchange (the
"Exchange Notice"), in the case of an exchange in accordance with
subparagraph (c)(1) not less than thirty (30) nor more than sixty (60) days
prior to the date fixed for such exchange (the "Exchange Date"), and in the
case of an exchange in accordance with subparagraph (c)(3) as soon as
practicable before or after the Exchange Date, in either case to their last
addresses as they shall appear upon the Corporation's books. Each such
Exchange Notice shall specify the Exchange Date and the Exchange Rate
applicable to such exchange, and shall state that issuance of certificates
representing Common Stock to be received upon exchange of shares of Class H
Common Stock shall be upon surrender of certificates representing such shares
of Class H Common Stock.
(9) Before any holder of shares of Class H Common Stock shall be entitled
to receive certificates representing such shares of Common Stock, he shall
surrender at such office as the Corporation shall specify certificates for
such shares of Class H Common Stock duly endorsed to the Corporation or in
blank or accompanied by proper instruments of transfer to the Corporation or
in blank, unless the Corporation shall waive such requirement. The
Corporation will, as soon as practicable after such surrender of certificates
representing such shares of Class H Common Stock, issue and deliver at the
office of the transfer agent representing the Common Stock to the person for
whose account such shares of Class H Common Stock were so surrendered, or to
his nominee or nominees, certificates representing the number of whole shares
of Common Stock to which he shall be entitled as aforesaid, together with the
Fractional Payment, if any.
(10) From and after the Exchange Date, all rights of a holder of shares
of Class H Common Stock which were exchanged for shares of Common Stock shall
cease except for the right, upon surrender of the certificates representing
such shares of Class H Common Stock, to receive certificates representing
shares of Common Stock together with a Fractional Payment, if any, as
contemplated by subparagraphs (c)(6) and (c)(9) of this paragraph (c) and
rights to dividends as provided in subparagraph (c)(7). No holder of a
certificate which immediately prior to the Exchange Date represented shares
of Class H Common Stock shall be entitled to receive any dividend or other
distribution with respect to shares of Common Stock until surrender of such
holder's certificate for a certificate or certificates representing shares of
Common Stock. Upon such surrender, there shall be paid to the holder the
amount of any dividends or other distributions (without interest) which
theretofore became payable with respect to a record date after the Exchange
Date, but which were not paid by reason of the foregoing, with respect to the
number of whole shares of Common Stock represented by the certificate or
certificates issued upon such surrender. From and after the Exchange Date
- 8 -
applicable to the Class H Common Stock, the Corporation shall, however, be
entitled to treat the certificates for Class H Common Stock which have not
yet been surrendered for exchange as evidencing the ownership of the number
of whole shares of Common Stock for which the shares of Class H Common Stock
represented by such certificates shall have been exchanged, notwithstanding
the failure to surrender such certificates.
(11) If any certificate for shares of Common Stock is to be issued in a
name other than that in which the certificate representing shares of Class H
Common Stock surrendered in exchange therefor is registered, it shall be a
condition of such issuance that the person requesting such issuance shall pay
any transfer or other taxes required by reason of the issuance of
certificates for such shares of Common Stock in a name other than that of the
record holder of the certificate surrendered, or shall establish to the
satisfaction of the Corporation or its agent that such tax has been paid or
is not applicable. Notwithstanding anything to the contrary in this paragraph
(c), the Corporation shall not be liable to a holder of shares of Class H
Common Stock for any shares of Common Stock or dividends or distributions
thereon delivered to a public official pursuant to any applicable abandoned
property, escheat or similar law.
(12) At such time as any Exchange Notice is delivered with respect to any
shares of Class H Common Stock, or at the time of the Exchange Date, if
earlier, the Corporation shall have reserved and kept available, solely for
the purpose of issuance upon exchange of the outstanding shares of Class H
Common Stock, such number of shares of Common Stock as shall be issuable upon
the exchange of the number of shares of Class H Common Stock specified or to
be specified in the Exchange Notice, provided, that nothing contained herein
shall be construed to preclude the Corporation from satisfying its
obligations in respect of the exchange of the outstanding shares of Class H
Common Stock by delivery of purchased shares of Common Stock which are held
in the treasury of the Corporation.
(d) Liquidation Rights.
In the event of the liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, after there shall have been
paid or set apart for the holders of Preferred Stock and Preference Stock the
full preferential amounts to which they are entitled, the holders of Common
Stock and Class H Common Stock shall be entitled to receive the assets of the
Corporation remaining for distribution to its stockholders, on a per share
basis in proportion to the respective per share liquidation units of such
classes. Subject to adjustment pursuant to paragraph (e) hereof, each share
of Common Stock and Class H Common Stock shall initially be entitled to
liquidation units of one (1.0) and one-half (0.5), respectively.
(e) Subdivision or Combination.
(1) If after December 20, 1985, the Corporation shall in any manner
subdivide (by stock split or otherwise) or combine (by reverse stock split or
otherwise) the outstanding shares of the Common Stock or Class H Common
Stock, or pay a stock dividend in shares of any class to holders of that
class, the per share voting rights specified in paragraph (b) and the per
share liquidation units specified in paragraph (d) of Class H Common Stock
relative to Common Stock shall be appropriately adjusted so as to avoid any
dilution in
- 9 -
the aggregate voting or liquidation rights of any class. Distribution by the
Corporation of shares of any class of its common stock as a dividend on any
other class of its common stock shall not require an adjustment pursuant to
this paragraph (e)(1).
(2) If after December 20, 1985, the Corporation shall distribute shares
of Class H Common Stock (such class being hereinafter referred to as the
"Distributed Class") as a dividend (the "Dividend") on Common Stock (such
class being hereinafter referred to as the "Recipient Class"), then the per
share liquidation rights of the classes of common stock set forth in
paragraph (d) above, as they may have been previously adjusted, shall be
adjusted so that:
(A) each holder of shares of any class other than the Recipient Class
shall be entitled to, with respect to such holder's interest in each such
class, the same percentage of the aggregate liquidation units of all
shares of the Corporation's common stock immediately after the Dividend
as such holder was entitled to, with respect to such holder's interest in
such class immediately prior to the Dividend; and
(B) each holder of shares of the Recipient Class shall be entitled to,
with respect to such holder's interest in the Recipient Class and all
shares of the Distributed Class issued with respect to such holder's
shares of the Recipient Class, the same percentage of the aggregate
liquidation units of all shares of the Corporation's common stock
immediately after the Dividend as such holder was entitled to with
respect to such holder's interest in the Recipient Class immediately
prior to the Dividend; provided, that any adjustment pursuant to this
subparagraph (e)(2)(B) shall be made to the liquidation units of the
Recipient Class.
In no event will any adjustments be made pursuant to this subparagraph
(e)(2) if the adjustment called for herein would reduce the liquidation units
of any class of common stock to less than zero.
(3) The determination of any adjustment required under this paragraph (e)
shall be made by the Corporation's Board of Directors; any such determination
shall be binding and conclusive upon all holders of shares of all classes of
the Corporation's common stock. Following any such determination, the
Secretary of the Corporation shall maintain a record of any such adjustment.
DIVISION II:
PREFERRED STOCK.
A statement of the relative rights of the holders of Preferred Stock and
a statement of the limits of variation between each series of Preferred Stock
as to rate of dividends and price of redemption and a statement of the voting
powers and the designations, powers, privileges and rights, and the
qualifications, limits or restrictions thereof of the various series thereof,
except so far as the Board of Directors is expressly authorized to fix the
same by resolution or resolutions for the various series of the Preferred
Stock, are as follows:
Preferred Stock of the Corporation may be issued in various series as may
be determined from time to time by the Board of Directors, each such series
to be distinctly designated. All shares of any one series of Preferred Stock
shall be alike in every particular, and all series shall rank equally and be
identical in all respects except as to the dividend rate and the amount
payable upon the exercise of the right to redeem.
- 10 -
The dividend on the Preferred Stock of each series shall be such rate as
may be fixed by the Board of Directors in the resolution or resolutions
providing for the issuance of the Preferred Stock of such series, and as
shall be stated on the face or back of the certificates of stock therefor.
The amount payable on the exercise of the right to redeem Preferred Stock
of each series shall be an amount as may be fixed by the Board of Directors
in the resolution or resolutions providing for the issuance of the Preferred
Stock of such series, and as shall be stated on the face or back of the
certificates of stock therefor.
All other provisions herein set forth in respect of the Preferred Stock
of the Corporation shall apply to all the Preferred Stock of the Corporation,
irrespective of any variations between the Preferred Stock of the different
series.
The holders of the Preferred Stock shall be entitled to receive
cumulative dividends, when and as declared by the Board of Directors, at the
rates fixed for the respective series in the Certificate of Incorporation or
in the resolution or resolutions of the Board of Directors providing for the
issuance of the respective series, and no more, payable quarterly on the
dates to be fixed by the By-Laws. The periods between such dates commencing
on such dates are herein designated as "dividend periods." Dividends on all
shares of any one series shall commence to accrue and be cumulative from the
first day of the current dividend period within which shares of such series
are first issued, but in the event of the issue of additional shares of such
series subsequent to the date of the first issue of said shares of such
series, all dividends paid on the shares of such series prior to the issue of
such additional shares and all dividends declared payable to holders of
record of shares of such series of a date prior to such issue shall be deemed
to have been paid in respect of the additional shares so issued. Such
dividends on the Preferred Stock shall be in preference and priority to any
payment on any other class of stock of the Corporation.
The dividends on the Preferred Stock shall be cumulative and shall be
payable before any dividend on the Common Stock or Class H Common Stock or
any series of the Preference Stock shall be paid or set apart so that if in
any year dividends a the rates determined for the respective series of the
Preferred Stock shall not be paid thereon, the deficiency shall be payable
before any dividend shall be paid upon or set apart for the Common Stock or
Class H Common Stock or any series of the Preference Stock. Dividends shall
not be declared and paid on the shares of Preferred Stock of any one series
for any dividend period unless dividends have been or are contemporaneously
paid or declared and set apart for payment thereof on the shares of Preferred
Stock of all series, for all the dividend periods terminating on the same or
an earlier date.
Whenever all cumulative dividends on the Preferred Stock outstanding
shall have been paid and a sum sufficient for the payment of the next ensuing
quarterly dividend on the Preferred Stock outstanding shall have been set
aside from the surplus or net profits, the Board of Directors may declare
dividends on the Common Stock or Class H Common Stock or any series of the
Preference Stock, payable then or thereafter, out of any remaining surplus or
net profits, and no holders of any shares of any series of Preferred Stock,
as such, shall be entitled to share therein.
- 11 -
At the option of the Board of Directors, the Preferred Stock shall be
subject to redemption at the amounts fixed for the respective series in the
Certificate of Incorporation or in the resolution or resolutions of the Board
of Directors providing for the issuance of the respective series, together,
in the case of each class or series, with accrued dividends on the shares to
be redeemed, on any dividend paying date in such manner as the Board of
Directors may determine.
The holders of the Preferred Stock shall not have any voting power
whatsoever, except upon the question of selling, conveying, transferring or
otherwise disposing of the property and assets of the Corporation as an
entirety and except as otherwise required by law.
DIVISION III:
PREFERENCE STOCK
The Board of Directors is authorized, subject to limitations prescribed
by law and the provisions of this Article FOURTH, to provide for the issuance
of Preference Stock from time to time in one or more series of any number of
shares, with a distinctive serial designation for each series, provided that
the aggregate number of shares issued and not cancelled of any and all such
series shall not exceed the total number of shares of Preference Stock
authorized by this Article FOURTH, all as shall hereafter be stated and
expressed in the resolution or resolutions providing for the issue of such
Preference Stock from time to time adopted by the Board of Directors. Subject
to said limitations, and provided that each series of Preference Stock shall
rank junior to the Preferred Stock with respect to the payment of dividends
and distributions in liquidation, each series of Preference Stock (a) may
have such voting powers, full or limited, or may be without voting powers;
(b) may be subject to redemption at such time or times and at such prices;
(c) may be entitled to receive dividends (which may be cumulative or
noncumulative) at such rate or rates, on such conditions, and at such times,
and payable in preference to, or in such relation to, the dividends payable
on any other class or classes or series of stock; (d) may have such rights
upon the dissolution of, or upon any distribution of the assets of, the
Corporation; (e) may be made convertible into, or exchangeable for, shares of
any other class or classes of or any other series of the same or any other
class or classes of stock of the Corporation or any other issuer, at such
price or prices or at such rates of exchange, and with such adjustments; (f)
may be entitled to the benefit of a sinking fund to be applied to the
purchase or redemption of shares of such series in such amount or amounts;
(g) may be entitled to the benefit of conditions and restrictions upon the
creation of indebtedness of the Corporation or any subsidiary, upon the issue
of any additional stock (including additional shares of such series or of any
other series) and upon the payment of dividends or the making of other
distributions on, and the purchase, redemption or other acquisition by the
Corporation or any subsidiary of any outstanding stock of the Corporation;
and (h) may have such other relative, participating, optional or other
special rights, qualifications, limitations or restrictions thereof; all as
shall be stated in said resolution or resolutions providing for the issue of
such series of Preference Stock.
- 12 -
Shares of any series of Preference Stock which have been redeemed
(whether through the operation of a sinking fund or otherwise) or which, if
convertible or exchangeable, have been converted into or exchanged for shares
of stock of any other class or classes shall have the status of authorized
and unissued shares of Preference Stock of the same series and may be
reissued as a part of the series of which they were originally a part or may
be reclassified and reissued as part of a new series of Preference Stock to
be created by resolution or resolutions of the Board of Directors or as part
of any other series of Preference Stock, all subject to the conditions or
restrictions on issuance set forth in the resolution or resolutions adopted
by the Board of Directors providing for the issue of any series of Preference
Stock.
DIVISION IV:
MISCELLANEOUS.
From time to time, the Preferred Stock, the Preference Stock, the Common
Stock and the Class H Common Stock may be increased or decreased according to
law, and may be issued in such amounts and proportions as shall be determined
by the Board of Directors, and as may be permitted by law.
In the event of any liquidation or dissolution or winding up, whether
voluntary or otherwise, of the Corporation, the holders of the Preferred
Stock shall be entitled to be paid the redemption price of each series in
full, as aforesaid, out of the assets whether capital or surplus, and, in
every case, the unpaid dividends accrued on such shares, whether or not
earned or declared, before any distribution of the assets to be distributed
shall be made to the holders of Common Stock or Class H Common Stock or any
series of the Preference Stock; but the holders of such shares shall be
entitled to no further participation in such distribution. If the assets
distributable on such liquidation, dissolution or winding up shall be
insufficient to permit the payment to the holders of the Preferred Stock of
the full amount of the redemption price of each series in full as aforesaid
and accrued dividends as aforesaid, the said assets shall be distributed pro
rata among the holders of the respective series of the Preferred Stock. After
all payments are made as aforesaid, any required payments shall be made with
respect to the Preference Stock, if any, outstanding, and the remaining
assets and funds shall be divided among and paid to the holders of Common
Stock and Class H Common Stock pro rata in proportion to the respective per
share liquidation units of such classes. The merger or consolidation of the
Corporation into or with any other corporation shall not be or be deemed to
be a distribution of assets or a dissolution, liquidation or winding up for
the purposes of this paragraph.
Any Preferred Stock, Preference Stock, Common Stock or Class H Common
Stock, authorized hereunder or under any amendment hereof, in the discretion
of the Board of Directors, may be issued, except as herein otherwise
provided, in payment for property or services, or as bonuses to employes of
the Corporation or employes of subsidiary companies, or for other assets or
securities including cash, necessary or desirable, in the judgment of the
Board of Directors, to be purchased or acquired from time to time for the
Corporation, or for any other lawful purpose of the Corporation.
If it seems desirable so to do, the Board of Directors may from time to
time issue scrip for fractional shares of stock. Such scrip shall not confer
upon the holder any right to dividends or any voting or other rights of a
stockholder of the Corporation, but the Corporation shall from time to time,
- 13 -
within such time as the Board of Directors may determine or without limit of
time if the Board of Directors so determines, issue one or more whole shares
of stock upon the surrender of scrip for fractional shares aggregating the
number of whole shares issuable in respect of the scrip so surrendered,
provided that the scrip so surrendered shall be properly endorsed for
transfer if in registered form.
ARTICLE FIFTH
The Corporation is to have perpetual existence.
ARTICLE SIXTH
The private property of the stockholders shall not be subject to the payment
of corporate debts to any extent whatever.
ARTICLE SEVENTH
The number of Directors of the Corporation, not less than three, shall be
fixed from time to time by the By-Laws and the number may be altered as
therein provided. In case of any increase in the number of Directors, the
additional Directors shall be elected as provided by the By-Laws, by the
Directors, or by the stockholders at an annual or special meeting. In case
of any vacancy in the Board of Directors, the remaining Directors, by
affirmative vote of a majority thereof, may elect a successor to hold office
for the unexpired portion of the term of the Director whose place is vacant
and until his successor shall be duly elected and qualified.
No Director shall be personally liable to the Corporation or its stockholders
for monetary damages for breach of fiduciary duty as a Director, except for
liability (i) for any breach of the Director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, (iii)
under Section 174, or any successor provision thereto, of the Delaware
General Corporation Law, or (iv) for any transaction from which the Director
derived an improper personal benefit.
In furtherance, and not in limitation of the powers conferred by law, the
Board of Directors are expressly authorized:
(a) To make, alter, amend and repeal the By-Laws of the Corporation.
(b) To remove at any time any officer elected or appointed by the Board of
Directors but only by the affirmative vote of a majority of the whole Board
of Directors. Any other officer or employee of the Corporation may be
removed at any time by a vote of the Board of Directors, or by any
committee or superior officer upon whom such power of removal may be
conferred by the By-Laws or by the vote of the Board of Directors.
(c) To designate, by resolution passed by a majority of the whole Board,
two or more of their number to constitute an executive committee, who, to the
extent provided in said resolution or in the By-Laws of the Corporation,
shall have and exercise the powers of the Board of Directors in the
management of the business and affairs of the Corporation, and shall have
power to authorize the seal of the Corporation to be affixed to all papers
which may require it. A majority of such committee shall constitute a
quorum for the transaction of business.
- 14 -
To designate any other standing committees by the affirmative vote of a
majority of the whole Board, and such standing committees shall have and may
exercise such powers as shall be conferred or authorized by the By-Laws,
including the power to cause the seal of the Corporation to be affixed to any
papers which may require it.
(c-1) Every right of action by or on behalf of the Corporation or by any
stockholder against any past, present or future member of the Board of
Directors, officer or employee of the Corporation arising out of or in
connection with any bonus, stock option, performance achievement or other
incentive plan at any time approved by the stockholders of the Corporation,
irrespective of the place where action may be brought and irrespective of the
place of residence of any such Director, officer or employee, shall cease and
be barred by the expiration of three years from whichever is the later of (a)
the date of the act or omission in respect of which such right of action
arises or (b) the first date upon which there has been made generally
available to stockholders an annual report of the Corporation and a proxy
statement for the annual meeting of stockholders following the issuance of
such annual report, which annual report and proxy statement alone or together
set forth, for the related period, the amount of any credit to a reserve for
the purpose of any such plan, and the aggregate bonus, performance
achievement or other awards, and the aggregate options or other grants, made
under any such plan; and every right of action by any employee (past, present
or future) against the Corporation arising out of or in connection with any
such plan shall, irrespective of the place where action may be brought, cease
and be barred by the expiration of three years from the date of the act or
omission in respect of which such right of action arises.
(d) From time to time to fix and to vary the sum to be reserved over and
above its capital stock paid in before declaring any dividends; to direct and
determine the use and disposition of any surplus or net profits over and
above the capital stock paid in; to fix the time of declaring and paying any
dividend, and, unless otherwise provided in this Certificate or in the
By-Laws, to determine the amount of any dividend. All sums reserved as
working capital or otherwise may be applied from time to time to the
acquisition or purchase of its bonds or other obligations or shares of its
own capital stock or other property to such extent and in such manner and
upon such terms as the Board of Directors shall deem expedient and neither
the stocks, bonds, or other property so acquired shall be regarded as
accumulated profits for the purpose of declaring or paying dividends unless
otherwise determined by the Board of Directors, but shares of such capital
stock so purchased or acquired may be resold, unless such shares shall have
been retired for the purpose of decreasing the Corporation's capital stock as
provided by law.
(e) From time to time to determine whether and to what extent, and at what
time and places and under what conditions and regulations the accounts and
books of the Corporation (other than the stock ledger), or any of them, shall
be open to the inspection of the stockholders; and no stockholder shall have
any right to inspect any account or book or document of Corporation, except
as conferred by statute or authorized by the Board of Directors or by a
resolution of the stockholders.
- 15 -
(f) With the written assent of the holders of two-thirds of its issued and
outstanding stock of all classes, without a meeting, or pursuant to the
affirmative vote in person or by proxy of the holders of two-thirds of its
issued and outstanding stock of all classes, at any meeting, either annual or
special, called as provided in the By-Laws, the Board of Directors may sell,
convey, assign, transfer or otherwise dispose of, any part or all of the
property, assets, rights and privileges of the Corporation as an entirety,
for the stock, bonds, obligations or other securities of another corporation
of this or of any other State, Territory, Colony or Foreign Country, or for
cash, or partly cash, credit or property, or for such other consideration as
the Board of Directors, in their absolute and uncontrolled discretion, may
determine.
(g) The Corporation may by its By-Laws confer upon the Directors powers and
authorities additional to the foregoing and to those expressly conferred upon
them by statute.
ARTICLE EIGHTH
Both the stockholders and the Directors of the Corporation may hold their
meetings and the Corporation may have an office or offices in such place or
places outside of the State of Delaware as the By-Laws may provide, and the
Corporation may keep its books outside of the State of Delaware except as
otherwise provided by law.
ARTICLE NINTH
The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation in the manner, now
or hereafter prescribed by statute, and all rights conferred on stockholders
herein are granted subject to this reservation.
- 16 -
l:\secfiles\8_k\1996\6-96byla.doc 29
EXHIBIT 3(ii)
G E N E R A L M O T O R S C O R P O R A T I O N
----------------------
BY-LAWS
As Amended to
June 7, 1996
<PAGE>
GENERAL MOTORS CORPORATION
BY-LAWS
INDEX
Page
ARTICLE I -- MEETINGS OF STOCKHOLDERS
1.1. Annual.........................................................1
1.2. Special........................................................1
1.3. Notice of Meetings.............................................1
1.4. List of Stockholders Entitled to Vote..........................1
1.5. Quorum.........................................................2
1.6. Organization...................................................2
1.7. Voting; Proxies................................................2
1.8. Fixing Date for Determination of Stockholders of Record........2
1.9. Adjournments...................................................3
1.10. Judges.........................................................3
ARTICLE II -- BOARD OF DIRECTORS
2.1. Responsibility and Number......................................3
2.2. Election; Resignation; Vacancies...............................3
2.3. Regular Meetings...............................................4
2.4. Special Meetings...............................................4
2.5. Quorum; Vote Required for Action ..............................4
2.6. Organization...................................................4
2.7. Transactions with Corporation..................................5
2.8. Ratification...................................................5
2.9. Informal Action by Directors...................................5
2.10. Telephonic Meetings Permitted..................................6
2.11. Notice of Stockholder Nomination and Stockholder Business......6
2.12. Independent Directors..........................................7
ARTICLE III -- COMMITTEES
3.1. Committees of the Board of Directors...........................8
3.2. Election and Vacancies.........................................8
3.3. Procedure; Quorum..............................................8
3.4. Executive Committee............................................9
3.5. Finance Committee..............................................9
3.6. Audit Committee................................................9
3.7. Executive Compensation Committee...............................9
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3.8. Public Policy Committee........................................10
3.9. Committee on Director Affairs..................................10
3.10. Capital Stock Committee.......................................11
ARTICLE IV -- OFFICERS
4.1. Elected Officers ..............................................11
4.2. Chief Executive Officer........................................11
4.3. President......................................................12
4.4. Treasurer......................................................12
4.5. Secretary......................................................12
4.6. Comptroller....................................................12
4.7. General Counsel................................................12
4.8. General Auditor................................................12
4.9. Chief Tax Officer..............................................13
4.10. Subordinate Officers...........................................13
4.11. Resignation, Removal, Suspension and Vacancies.................13
ARTICLE V -- INDEMNIFICATION
5.1. Right to Indemnification of Directors and Officers ............14
5.2. Advancement of Expenses of Directors and Officers..............14
5.3. Claims by Officers or Directors................................14
5.4. Indemnification of Employees...................................15
5.5. Advancement of Expenses of Employees...........................15
5.6. Non-Exclusivity of Rights......................................15
5.7. Other Indemnification..........................................15
5.8. Insurance......................................................15
5.9. Amendment or Repeal............................................16
ARTICLE VI -- MISCELLANEOUS
6.1. Offices........................................................16
6.2. Stock Certificates.............................................16
6.3. Seal...........................................................16
6.4. Dividends on Preferred Stock...................................17
6.5. Fiscal Year....................................................17
6.6. Annual Report..................................................17
6.7. Notice.........................................................17
6.8. Waiver of Notice...............................................17
6.9. Voting of Stocks Owned by the Corporation......................17
6.10. Form of Records................................................18
6.11. Amendment of By-Laws...........................................18
6.12. Anti-Greenmail.................................................18
6.13. Gender Pronouns................................................19
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DEFINITION OF CERTAIN TERMS USED IN AND GUIDELINES
FOR THE APPLICATION OF BY-LAW 2.12 OF GENERAL MOTORS
CORPORATION..........................................................i
SECURITIES ACT AND EXCHANGE ACT PARAGRAPH 2 OF
INSTRUCTIONS TO PARAGRAPH (b) OF ITEM 404 OF
REGULATION S-K AS IN EFFECT ON JANUARY 7, 1991
(REFERRED TO IN PARAGRAPH (i) OF GUIDELINES FOR
APPLICATION OF BY-LAW 2.12 OF GENERAL MOTORS
CORPORATION).........................................................iv
DEFINITION OF CERTAIN TERMS USED IN BY-LAW 6.12......................v
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GENERAL MOTORS CORPORATION
BY-LAWS
ARTICLE I
MEETINGS OF STOCKHOLDERS
1.1. Annual.
The annual meeting of stockholders for the election of directors,
ratification or rejection of the selection of auditors and the transaction of
such other business as may properly be brought before the meeting shall be
held on the third Friday following the first Monday in May in each year, or
on such other date and at such place and time as the chairman of the board or
the board of directors shall designate.
1.2. Special.
Special meetings of stockholders may be called by the board of directors or
the chairman of the board of directors at such place, date and time and for
such purpose or purposes as shall be set forth in the notice of such meeting.
1.3. Notice of Meetings.
Written notice of each meeting of stockholders shall be given by the chairman
of the board and/or the secretary in compliance with the provisions of
Delaware law.
1.4. List of Stockholders Entitled to Vote.
The secretary shall prepare, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any stockholder,
for any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten days prior to the meeting, either at a place within
the city where the meeting is to be held, which place shall be specified in
the notice of the meeting, or, if not so specified, at the place where the
meeting is to be held. The list shall also be produced and kept at the time
and place of the meeting during the whole time thereof and may be inspected
by any stockholder who is present.
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1.5. Quorum.
At each meeting of stockholders, except where otherwise provided by law or
the certificate of incorporation or these by-laws, the holders of one-third
of the voting power of the outstanding shares of stock entitled to vote at
the meeting, present in person or by proxy, shall constitute a quorum. In the
absence of a quorum, the stockholders so present may, by majority vote,
adjourn the meeting from time to time in the manner provided in Section 1.9
of these by-laws until a quorum shall attend. Shares of its own stock
belonging to the corporation or to another corporation, if a majority of the
shares entitled to vote in the election of directors of such other
corporation is held, directly or indirectly, by the corporation, shall
neither be entitled to vote nor be counted for quorum purposes; provided,
however, that the foregoing shall not limit the right of the corporation to
vote stock, including but not limited to its own stock, held by it in a
fiduciary capacity.
1.6. Organization.
The chairman or, if he so designates or is absent, the chief executive
officer or, in their absence, an executive vice president or vice president
designated by the board of directors, shall preside at meetings of the
stockholders. The secretary of the corporation shall act as secretary, but
in his absence the presiding officer may appoint a secretary.
1.7. Voting; Proxies.
Each stockholder shall be entitled to vote in accordance with the number of
shares and voting powers of the voting shares held of record by him. Each
stockholder entitled to vote at a meeting of stockholders may authorize
another person or persons to act for him by proxy, but such proxy, whether
revocable or irrevocable, shall comply with the requirements of Delaware
law. Voting at meetings of stockholders, on other than the election of
directors, need not be by written ballot unless the holders of a majority of
the outstanding shares of all classes of stock entitled to vote thereon
present in person or by proxy at such meeting shall so determine. At all
meetings of stockholders for the election of directors a plurality of the
voting power of the shares of stock present in person or represented by proxy
and entitled to vote shall be sufficient. All other elections and questions
shall, unless otherwise provided by law or by the certificate of
incorporation or these by-laws, be decided by the vote of the holders of a
majority of the voting power of the shares of stock entitled to vote thereon
present in person or by proxy at the meeting.
1.8. Fixing Date for Determination of Stockholders of Record.
In order that the corporation may determine the stockholders entitled: (a) to
notice of or to vote at any meeting of stockholders or any adjournment
thereof; (b) to express consent to corporate action in writing without a
meeting; (c) to receive payment of any dividend or other distribution or
allotment of any rights; or (d) to exercise any rights in respect of any
change, conversion or exchange of stock or for the purpose of any other
lawful action, the board of directors may fix a record date. The record date
shall not precede the date upon which the resolution fixing the record date
is adopted by the board of directors and which record date: (a) in the case
of
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determination of stockholders entitled to vote at any meeting of stockholders
or adjournment thereof, shall not be more than sixty nor less than ten days
before the date of such meeting; (b) in the case of determination of
stockholders entitled to express consent to corporate action in writing
without a meeting, shall not be more than ten days from the date upon which
the resolution fixing the record date is adopted by the board of directors;
and (c) in the case of any other action, shall not be more than sixty days
prior to such other action. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders shall apply to
any adjournment of the meeting; provided, however, that the board of
directors may fix a new record date for the adjourned meeting.
1.9. Adjournments.
Any meeting of stockholders, annual or special, may adjourn from time to time
to reconvene at the same or some other place, and notice need not be given of
any such adjourned meeting if the time and place thereof are announced at the
meeting at which the adjournment is taken. At the adjourned meeting the
corporation may transact any business which might have been transacted at the
original meeting. If the adjournment is for more than thirty days, or if
after the adjournment a new record date is fixed for the adjourned meeting,
a notice of the adjourned meeting shall be given to each stockholder of
record entitled to vote at the meeting.
1.10. Judges.
All votes by ballot at any meeting of stockholders shall be conducted by two
judges appointed for the purpose, either by the directors or by the chairman
of the meeting. The judges shall decide upon the qualifications of voters,
count the votes and declare the result.
ARTICLE II
BOARD OF DIRECTORS
2.1. Responsibility and Number.
The business and affairs of the corporation shall be managed by or under the
direction of a board of directors. The number of directors shall be
determined from time to time by resolution of the board of directors, but the
total number of directors shall not be less than twelve or more than twenty.
2.2. Election; Resignation; Vacancies.
At each annual meeting of stockholders, the stockholders shall elect
directors each of whom shall hold office for a term commencing on the date of
the annual meeting of stockholders, or such later date as shall be determined
by the board of directors, and ending on the next annual meeting of
stockholders, or until his successor is elected and qualified. Any director
may resign at any time upon written notice to the chairman of the board or to
the secretary.
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Any vacancy occurring in the board of directors for any cause may be filled
by a majority of the remaining members of the board of directors, although
such majority is less than a quorum. Each director so elected shall hold
office concurrent with the term of other directors or until his successor is
elected and qualified.
2.3. Regular Meetings.
Unless otherwise determined by resolution of the board of directors, a
meeting of the board of directors for the election of officers and the
transaction of such other business as may come before it shall be held as
soon as practicable following the annual meeting of stockholders, and other
regular meetings of the board of directors shall be held either on the first
Monday of each month, and if that be a legal holiday, then on the next Monday
not a legal holiday, or such other days as may from time to time be
designated by the chairman of the board of directors.
2.4. Special Meetings.
Special meetings of the board of directors may be called by the chairman of
the board of directors, the chief executive officer, the president or a vice
chairman, and shall be called by the secretary at the request in writing of
one-third of the directors then in office. Notice of a special meeting of
the board of directors shall be given at least twenty-four hours before the
special meeting.
2.5. Quorum; Vote Required for Action.
At all meetings of the board of directors, one-third of the whole board shall
constitute a quorum for the transaction of business. Except in cases in
which applicable law, the certificate of incorporation or these by-laws
otherwise provide, the vote of a majority of the directors present at a
meeting at which a quorum is present shall be the act of the board of
directors.
2.6. Organization.
The board of directors shall annually elect one of its members to be chairman
of the board and shall fill any vacancy in the position of chairman of the
board at such time and in such manner as the board of directors shall
determine. The chairman of the board may but need not be an officer of or
employed in an executive or any other capacity by the corporation.
The chairman of the board of directors shall preside at meetings of the board
of directors and lead the board in fulfilling its responsibilities as defined
in section 2.1 and, in particular, its responsibilities to oversee the
performance of the corporation and of the executive management of the
corporation.
The board of directors may also elect one of its members as vice chairman of
the board of directors who shall have such duties and responsibilities as are
provided by these by-laws or may be directed by the board of directors, the
chairman of the board, or the chairman of the executive committee of the
board of directors.
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In the absence of the chairman of the board of directors, the vice chairman,
or in his absence, the chairman of the executive committee of the board of
directors, or in his absence, a member of the board selected by the members
present, shall preside at meetings of the board. The secretary of the
corporation shall act as secretary of the meetings of the board of directors,
but in his absence, the presiding officer may appoint a secretary for the
meeting.
2.7. Transactions with Corporation.
No contract or transaction between the corporation and one or more of its
directors, or between the corporation and any other corporation, partnership,
association, or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be
void or voidable for this reason, or solely because the director or officer
is present at or participates in the meeting of the board or committee
thereof which authorizes the contract or transaction, or solely because his
or their votes are counted for such purpose: (1) if the material facts as to
his relationship or interest and as to the contract or transaction are
disclosed or are known to the board of directors or the committee, and the
board or committee in good faith authorizes the contract or transaction by
the affirmative votes of a majority of the disinterested directors, even
though the disinterested directors be less than a quorum; or (2) if the
material facts as to his relationship or interest and as to the contract or
transaction are disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in good
faith by vote of the stockholders; or (3) if the contract or transaction is
fair as to the corporation as of the time it is authorized, approved or
ratified, by the board of directors, a committee thereof, or the stockholders.
Common or interested directors may be counted in determining the presence of
a quorum at a meeting of the board of directors or of a committee which
authorizes the contract or transaction.
2.8. Ratification.
Any transaction questioned in any stockholders' derivative suit on the ground
of lack of authority, defective or irregular execution, adverse interest of
director, officer or stockholder, non-disclosure, miscomputation, or the
application of improper principles or practices of accounting may be ratified
before or after judgment, by the board of directors or by the stockholders in
case less than a quorum of directors are qualified; and, if so ratified,
shall have the same force and effect as if the questioned transaction had
been originally duly authorized, and said ratification shall be binding upon
the corporation and its stockholders and shall constitute a bar to any claim
or execution of any judgment in respect of such questioned transaction.
2.9. Informal Action by Directors.
Unless otherwise restricted by the certificate of incorporation or these
by-laws, any action required or permitted to be taken at any meeting of the
board of directors, or of any committee thereof, may be taken without a
meeting if all members of the board or such committee, as the case may be,
consent thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the board or committee.
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2.10. Telephonic Meetings Permitted.
Members of the board of directors, or any committee designated by the board,
may participate in a meeting of such board or committee by means of
conference telephone or similar communications equipment by means of which
all persons participating in the meeting can hear each other, and
participation in a meeting pursuant to this by-law shall constitute presence
in person at such meeting.
2.11. Notice of Stockholder Nomination and Stockholder Business.
At a meeting of the stockholders, only such business shall be conducted as
shall have been properly brought before the meeting. Nominations for the
election of directors may be made by the board of directors or by any
stockholder entitled to vote for the election of directors. Other matters to
be properly brought before the meeting must be: (a) specified in the notice
of meeting (or any supplement thereto) given by or at the direction of the
board of directors, including matters covered by rule 14a-8 of the Securities
and Exchange Commission; (b) otherwise properly brought before the meeting by
or at the direction of the board of directors; or (c) otherwise properly
brought before the meeting by a stockholder.
A notice of the intent of a stockholder to make a nomination or to bring any
other matter before the meeting shall be made in writing and received by the
secretary of the corporation not more than 180 days and not less than 120
days in advance of the annual meeting or, in the event of a special meeting
of stockholders, such notice shall be received by the secretary of the
corporation not later than the close of the fifteenth day following the day
on which notice of the meeting is first mailed to stockholders.
Every such notice by a stockholder shall set forth:
(a) the name and residence address of the stockholder of the corporation who
intends to make a nomination or bring up any other matter;
(b) a representation that the stockholder is a holder of the corporation's
voting stock and intends to appear in person or by proxy at the meeting to
make the nomination or bring up the matter specified in the notice;
(c) with respect to notice of an intent to make a nomination, a description
of all arrangements or understandings among the stockholder and each nominee
and any other person or persons (naming such person or persons) pursuant to
which the nomination or nominations are to be made by the stockholder;
(d) with respect to notice of an intent to make a nomination, such other
information regarding each nominee proposed by such stockholder as would have
been required to be included in a proxy statement filed pursuant to the proxy
rules of the Securities and Exchange Commission had each nominee been
nominated by the board of directors of the corporation; and
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(e) with respect to notice of an intent to bring up any other matter, a
description of the matter, and any material interest of the stockholder in
the matter.
Notice of intent to make a nomination shall be accompanied by the written
consent of each nominee to serve as director of the corporation if so elected.
At the meeting of stockholders, the chairman shall declare out of order and
disregard any nomination or other matter not presented in accordance with
this section.
2.12. Independent Directors.
(a) Majority of Board's Nominees in Annual Proxy Statement for Election to
Board of Directors to be Independent. A majority of the individuals to
constitute the nominees of the board of directors for the election of whom
the board will solicit proxies from the stockholders for use at the
corporation's annual meeting shall consist of individuals who, on the date of
their selection as the nominees of the board of directors, would be
Independent Directors.
(b) Directors Elected by Board of Directors. In the event the board of
directors elects directors between annual meetings of stockholders, the
number of such directors who qualify as Independent Directors on the date of
their nomination shall be such that the majority of all directors holding
office immediately thereafter shall have been Independent Directors on the
date of the first of their nomination or selection as nominees of the board
of directors.
(c) Definition of Independent Director. For purposes of this by-law, the
term "Independent Director" shall mean a director who: (i) is not and has not
been employed by the corporation or its subsidiaries in an executive capacity
within the five years immediately prior to the annual meeting at which the
nominees of the board of directors will be voted upon; (ii) is not (and is
not affiliated with a company or a firm that is) a significant advisor or
consultant to the corporation or its subsidiaries; (iii) is not affiliated
with a significant customer or supplier of the corporation or its
subsidiaries; (iv) does not have significant personal services contract(s)
with the corporation or its subsidiaries; (v) is not affiliated with a
tax-exempt entity that receives significant contributions from the
corporation or its subsidiaries; and (vi) is not a spouse, parent, sibling or
child of any person described by (i) through (v).
(d) Interpretation and Application of This By-Law. The board of directors
shall have the exclusive right and power to interpret and apply the
provisions of this by-law, including, without limitation, the adoption of
written definitions of terms used in and guidelines for the application of
this by-law (any such definitions and guidelines shall be filed with the
Secretary, and such definitions and guidelines as may prevail shall be made
available to any stockholder upon written request); any such definitions or
guidelines and any other interpretation or application of the provisions of
this by-law made in good faith shall be binding and conclusive upon all
holders of GM Equity Securities, provided that, in the case of any
interpretation or application of
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this by-law by the board of directors to a specific person which results in
such person being classified as an Independent Director, the board of
directors shall have determined that such person is independent of management
and free from any relationship that, in the opinion of the board of
directors, would interfere with such person's exercise of independent
judgment as a board member.
ARTICLE III
COMMITTEES
3.1. Committees of the Board of Directors.
The board of directors may, by resolution passed by a majority of the whole
board, designate one or more committees, consisting of one or more of the
directors of the corporation, to be committees of the board of directors
("committees of the board"). All committees of the board may authorize the
seal of the corporation to be affixed to any papers which may require it. To
the extent provided in any resolution of the board of directors or these
by-laws, and to the extent permissible under the laws of the State of
Delaware and the certificate of incorporation, any such committee shall have
and may exercise all the powers and authority of the board of directors in
the management of the business and affairs of the corporation.
The following committees shall be standing committees of the board: the
executive committee, the finance committee, the audit committee, the
executive compensation committee, the public policy committee, the committee
on director affairs and the capital stock committee. The board of directors
may designate, by resolution adopted by a majority of the whole board,
additional committees of the board and may prescribe for each such committee
such powers and authority as may properly be granted to such committees in
the management of the business and affairs of the corporation.
3.2. Election and Vacancies.
The members and chairmen of each standing committee of the board shall be
elected annually by the board of directors at its first meeting after each
annual meeting of stockholders or at any other time the board of directors
shall determine. The members of other committees of the board may be elected
at such time as the board may determine. Vacancies in any committee of the
board may be filled at such time and in such manner as the board of directors
shall determine. No officer or other employee of the corporation shall be a
member of any standing committee of the board, with the exception of the
finance committee.
3.3. Procedure; Quorum.
Except to the extent otherwise provided in these by-laws or any resolution of
the board of directors, each committee of the board and each committee of the
corporation may fix its own rules of procedure.
The members necessary to constitute a quorum of any committee of the board or
committee of the corporation shall be one-third of the members thereof, or
such larger number as shall be set forth in the by-laws, or as shall be
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determined from time to time by resolution of the board of directors. The
vote of a majority of the members present at a meeting of a committee of the
board or committee of the corporation at which meeting a quorum is present
shall be the act of the committee unless the certificate of incorporation,
the by-laws or a resolution of the board of directors shall require the vote
of a greater number.
3.4. Executive Committee.
The members of the executive committee shall be the chairman of the other
standing committees of the board of directors and the chairman of the
executive committee, who shall be a director designated by the board of
directors. The chairman of the executive committee shall not concurrently be
the chairman of any of the standing committees of the board of directors and
shall not be an officer or employee of the corporation. The chairman of the
executive committee shall be an ex officio member of each standing committee
of the board of directors. The executive committee of the board of directors
shall have and may exercise, between meetings of the board of directors, all
of the powers and authority which the board of directors may exercise in the
direction and management of the business and affairs of the corporation,
except as prohibited by the law of the State of Delaware or the certificate
of incorporation.
3.5. Finance Commitee.
The board of directors shall select the members of the finance committee and
shall designate the chairman of the committee. Except for powers hereinafter
assigned to the audit committee and the incentive and compensation committee,
or as otherwise provided by the board of directors, the finance committee
shall have and may exercise the powers, authority and responsibilities of the
board of directors for the determination of the financial policies of the
corporation and the management of the financial affairs of the corporation.
3.6. Audit Committee.
The board of directors shall select the members of the audit committee and
shall designate the chairman of the committee. The members of the audit
committee shall not be eligible to participate in any incentive compensation
plan for employees of the corporation or any of its subsidiaries. The
selection by the committee of accountants for the ensuing calendar year shall
be made annually in advance of the annual meeting of stockholders and shall
be submitted to the stockholders for ratification or rejection at such
meeting. The audit committee shall have and may exercise such powers,
authority and responsibilities as are normally incident to the functions of
an audit committee or as may be determined by the board of directors.
3.7. Executive Compensation Committee.
The board of directors shall select the members of the executive compensation
committee and shall designate the chairman of the committee. No member of
the committee shall be eligible to participate in any plan falling within the
jurisdiction of the committee. The committee shall have and may exercise the
powers and authority granted to it by any incentive compensation plan for
9
employees of the corporation or any of its subsidiaries, and such other
powers, authority and responsibilities as may be determined by the board of
directors.
The committee shall determine the compensation of: (a) employees of the
corporation who are directors of the corporation; and (b) after receiving and
considering the recommendation of the chief executive officer and the
president of the corporation, all other employees of the corporation who are
officers of the corporation or who occupy such other positions as may be
designated by the committee.
Where compensation is payable to an employee of any subsidiary and such
employee is also a director or officer of the corporation or one of its
subsidiaries, or where such employee occupies such other position as may be
designated by the committee and such compensation is determined by or on
behalf of such subsidiary, the amount so determined shall first be submitted
to the committee for its review. No such determination shall be effective if
it would result in compensation which, in the aggregate or with respect to
any one or more of such employees, would exceed amounts or rates established
or approved by the committee.
Where any employee benefit or incentive compensation plan affects employees
of the corporation or its subsidiaries and the compensation of such employees
is determined or subject to review by the committee, such plan shall first be
submitted to the committee for its review. Any such plan or amendment or
modification shall be made effective with respect to such employees only if
and to the extent approved by the committee.
3.8. Public Policy Committee.
The board of directors shall select the members of the public policy
committee, and shall designate the chairman of the committee. The committee
shall, upon its own initiative or otherwise, inquire into all phases of the
corporation's business activities that relate to matters of public policy.
The committee may make recommendations to the board of directors to assist it
in the formulation and adoption of basic policies calculated to promote the
best interests of the corporation and the community. The public policy
committee shall have and may exercise such other powers, authority and
responsibilities as may be determined by the board of directors.
3.9. Committee on Director Affairs.
The board of directors shall select the members of the committee on director
affairs, and shall designate the chairman of the committee. The committee
shall be responsible for matters related to service on the board of directors
of the corporation, and associated issues of corporate governance. The
committee from time to time shall conduct studies of the size and composition
of the board of directors. Prior to each annual meeting of stockholders, the
committee shall recommend to the board the individuals to constitute the
nominees of the board of directors, the election of whom the board will
solicit proxies. The committee shall review the qualifications of
individuals for consideration as director candidates and shall recommend to
the board, for its consideration, the names of individuals for election by
the board. In
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addition, the committee shall from time to time conduct studies and make
recommendations to the board regarding compensation of directors. The
committee shall have and may exercise such other powers, authority and
responsibilities as may be determined by the board of directors.
3.10. Capital Stock Committee.
The board of directors shall select the members of the capital stock
committee and shall designate the chairman of the committee. The committee
shall be responsible for reviewing the policies, programs and practices of
the corporation relating to: (a) the business and financial relationships
between the corporation or any of its units with Hughes Electronics
Corporation; (b) dividends in respect of, disclosures to stockholders and the
public concerning, and transactions by the corporation or any of its
subsidiaries in, shares of Class H Common Stock; and (c) any matters arising
in connection therewith, all to the extent the committee may deem
appropriate, and to recommend such changes in such policies, programs and
practices as the committee may deem appropriate. In performing this
function, the committee's role is not to make decisions concerning matters
referred to its attention, but rather to oversee the process by which
decisions concerning such matters are made. The committee shall have and may
exercise such other powers, authority and responsibilities as may be
determined by the board of directors.
ARTICLE IV
OFFICERS
4.1. Elected Officers.
The officers of the corporation shall be elected by the board of directors.
There shall be a chief executive officer, a president, one or more executive
vice presidents, one or more vice presidents, a secretary, a treasurer, a
comptroller, a general counsel, a general auditor and a chief tax officer.
The chief executive officer and the president shall be members of the board
of directors and shall have the other powers, authority and responsibilities
provided by these by-laws. The officers, other than the chief executive
officer and the president, shall each have, in addition to the powers,
authority and responsibilities of those officers otherwise provided by the
by-laws, such powers, authority and responsibilities as the board of
directors or the chief executive officer may determine. The board of
directors may also elect persons to hold such other offices as the board of
directors shall determine, including one or more vice chairmen of the
board. A person may hold any number of offices. Elected officers shall
hold their offices at the pleasure of the board of directors, or until their
earlier resignation.
4.2. Chief Executive Officer.
The chief executive officer shall have the general executive responsibility
for the conduct of the business and affairs of the corporation. If the
chairman so designates or is absent, the chief executive officer shall
preside at meetings of the stockholders. He shall exercise such other
powers, authority and responsibilities as the board of directors may
determine.
11
In the absence of or during the physical disability of the chief executive
officer, the board of directors shall designate an officer who shall have and
exercise the powers, authority and responsibilities of the chief executive
officer.
4.3. President.
The president shall have and exercise such powers, authority and
responsibilities as the board of directors may determine.
4.4. Treasurer.
The treasurer shall have custody of all funds and securities of the
corporation and shall perform all acts incident to the position of
treasurer. He shall render such accounts and reports as may be required by
the board of directors. The records, books and accounts of the office of the
treasurer shall, during the usual hours for business at the office of the
treasurer, be open to the examination of any director.
4.5. Secretary.
The secretary shall keep the minutes of all meetings of stockholders and
directors and of such committees of the board of directors as to which he may
be so directed. He shall give all required notices and shall have charge of
such books and papers as the board of directors may require. He shall submit
such reports to the board of directors or to any of the committees of the
board or committees of the corporation as the board of directors or any such
committee may require. Any action or duty required to be performed by the
secretary may be performed by an assistant secretary.
4.6. Comptroller.
The comptroller shall be in charge of the accounts of the corporation and
shall perform all acts incident to the position of comptroller. He shall
submit such reports and records to the board of directors or to any of the
committees of the board or committees of the corporation as the board of
directors or any such committee may require.
4.7. General Counsel.
The board of directors shall elect a general counsel who shall be the chief
legal officer of the corporation. He shall have general control of all
matters of legal import concerning the corporation and shall have such other
powers, authority and responsibilities as may be determined by the board of
directors or the chief executive officer.
4.8. General Auditor.
The general auditor shall have such powers, authority and responsibilities as
are incident to the position of general auditor in the performance of an
independent audit activity of the corporation and shall have direct access to
the audit committee.
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4.9. Chief Tax Officer.
The chief tax officer shall have responsibility for all tax matters involving
the corporation, with authority to sign and to delegate to others authority
to sign all returns, reports, agreements and documents involving the
administration of the corporation's tax affairs.
4.10. Subordinate Officers.
The board of directors may from time to time appoint one or more assistant
secretaries, assistant treasurers, assistant comptrollers, and such other
subordinate officers as the board of directors may deem advisable. Such
subordinate officers shall have such powers, authority and responsibilities
as the board of directors may from time to time determine. The board of
directors may grant to any committee of the board or the chief executive
officer the power and authority to appoint subordinate officers and to
prescribe their respective terms of office, powers, authority and
responsibilities. Each subordinate officer shall hold his position at the
pleasure of the board of directors, the committee of the board appointing
him, the chief executive officer and any other officer to whom such
subordinate officer reports.
In the interval between annual organizational meetings of the board of
directors, the chief executive officer shall have the power and authority to
appoint such subordinate officers. Such subordinate officers shall serve
until the first meeting of the board of directors immediately following the
annual meeting of stockholders.
4.11. Resignation, Removal, Suspension and Vacancies.
Any officer may resign at any time by giving written notice to the chief
executive officer, the president or the secretary. Unless stated in the
notice of resignation, the acceptance thereof shall not be necessary to make
it effective. It shall take effect at the time specified therein or, in the
absence of such specification, it shall take effect upon the receipt thereof.
Any officer elected by the board of directors may be suspended or removed at
any time by the affirmative vote of a majority of the whole board. Any
subordinate officer of the corporation appointed by the board of directors or
a committee of the board, or the chief executive officer, may be suspended or
removed at any time by a majority vote of a quorum of the board of directors
or committee appointing such subordinate officer, or by the chief executive
officer or any other officer to whom such subordinate officer reports.
The chief executive officer may suspend the powers, authority,
responsibilities and compensation of any elected officer or appointed
subordinate officer for a period of time sufficient to permit the board or
the appropriate committee of the board a reasonable opportunity to consider
and act upon a resolution relating to the reinstatement, further suspension
or removal of such person.
As appropriate, the board of directors, a committee of the board, and/or the
chief executive officer may fill any vacancy created by the resignation,
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death, retirement or removal of an officer in the same manner as provided for
the election or appointment of such person.
ARTICLE V
INDEMNIFICATION
5.1. Right to Indemnification of Directors and Officers.
Subject to the other provisions of this article, the corporation shall
indemnify and advance expenses to every director and officer (and to such
person's heirs, executors, administrators or other legal representatives) in
the manner and to the full extent permitted by applicable law as it presently
exists, or may hereafter be amended, against any and all amounts (including
judgments, fines, payments in settlement, attorneys' fees and other expenses)
reasonably incurred by or on behalf of such person in connection with any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative ("a proceeding"), in which such
director or officer was or is made or is threatened to be made a party or is
otherwise involved by reason of the fact that such person is or was a
director or officer of the corporation, or is or was serving at the request
of the corporation as a director, officer, employee, fiduciary or member of
any other corporation, partnership, joint venture, trust, organization or
other enterprise. The corporation shall not be required to indemnify a
person in connection with a proceeding initiated by such person if the
proceeding was not authorized by the board of directors of the corporation.
5.2. Advancement of Expenses of Directors and Officers.
The corporation shall pay the expenses of directors and officers incurred in
defending any proceeding in advance of its final disposition ("advancement of
expenses"); provided, however, that the payment of expenses incurred by a
director or officer in advance of the final disposition of the proceeding
shall be made only upon receipt of an undertaking by the director or officer
to repay all amounts advanced if it should be ultimately determined that the
director or officer is not entitled to be indemnified under this article or
otherwise.
5.3. Claims by Officers or Directors.
If a claim for indemnification or advancement of expenses by an officer or
director under this article is not paid in full within ninety days after a
written claim therefor has been received by the corporation, the claimant may
file suit to recover the unpaid amount of such claim and, if successful in
whole or in part, shall be entitled to be paid the expense of prosecuting
such claim. In any such action the corporation shall have the burden of
proving that the claimant was not entitled to the requested indemnification
or advancement of expenses under applicable law.
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5.4. Indemnification of Employees.
Subject to the other provisions of this article, the corporation may
indemnify and advance expenses to every employee who is not a director or
officer (and to such person's heirs, executors, administrators or other legal
representatives) in the manner and to the full extent permitted by applicable
law as it presently exists, or may hereafter be amended against any and all
amounts (including judgments, fines, payments in settlement, attorneys' fees
and other expenses) reasonably incurred by or on behalf of such person in
connection with any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative ("a
proceeding"), in which such employee was or is made or is threatened to be
made a party or is otherwise involved by reason of the fact that such person
is or was an employee of the corporation, or is or was serving at the request
of the corporation as a director, officer, employee, fiduciary or member of
any other corporation, partnership, joint venture, trust, organization or
other enterprise. The ultimate determination of entitlement to
indemnification of employees who are not officers and directors shall be made
in such manner as is provided by applicable law. The corporation shall not
be required to indemnify a person in connection with a proceeding initiated
by such person if the proceeding was not authorized by the board of directors
of the corporation.
5.5. Advancement of Expenses of Employees.
The advancement of expenses of an employee who is not an officer or director
shall be made by or in the manner provided by resolution of the board of
directors or by a committee of the board of directors or of the corporation.
5.6. Non-Exclusivity of Rights.
The rights conferred on any person by this Article V shall not be exclusive
of any other rights which such person may have or hereafter acquire under any
statute, provision of the certificate of incorporation, these by-laws,
agreement, vote of stockholders or disinterested directors or otherwise.
5.7. Other Indemnification.
The corporation's obligation, if any, to indemnify any person who was or is
serving at its request as a director, officer or employee of another
corporation, partnership, joint venture, trust, organization or other
enterprise shall be reduced by any amount such person may collect as
indemnification from such other corporation, partnership, joint venture,
trust, organization or other enterprise.
5.8. Insurance.
The board of directors may, to the full extent permitted by applicable law as
it presently exists, or may hereafter be amended from time to time, authorize
an appropriate officer or officers to purchase and maintain at the
corporation's expense insurance: (a) to indemnify the corporation for any
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obligation which it incurs as a result of the indemnification of directors,
officers and employees under the provisions of this Article V; and (b) to
indemnify or insure directors, officers and employees against liability in
instances in which they may not otherwise be indemnified by the corporation
under the provisions of this Article V.
5.9. Amendment or Repeal.
Any repeal or modification of the foregoing provisions of this Article V
shall not adversely affect any right or protection hereunder of any person in
respect of any act or omission occurring prior to the time of such repeal or
modification.
ARTICLE VI
MISCELLANEOUS
6.1. Offices.
The registered office of the corporation shall be located at 1209 Orange
Street, Wilmington, New Castle County, Delaware, and the name of the
registered agent in charge thereof shall be The Corporation Trust Company.
The corporation may also have other offices without as well as within the
State of Delaware. The books of the corporation may be kept outside the
State of Delaware.
6.2. Stock Certificates.
Every holder of stock shall be entitled to have a certificate signed by or in
the name of the corporation by the chairman or a vice chairman of the board
of directors, or the president or a vice president, and by the treasurer or
an assistant treasurer, or the secretary or an assistant secretary of the
corporation, certifying the number of shares owned by him in the corporation.
The form of such certificates and the signatures thereon shall comply with
the requirements of Delaware law. The corporation shall maintain a record of
the holders of each certificate and transfer stock and issue new certificates
to replace lost, stolen or destroyed certificates only pursuant to the
applicable requirements of Delaware law as they presently exist, or may be
amended from time to time.
6.3. Seal.
The corporate seal shall have inscribed upon it the name of the corporation,
the year of its organization and the words "Corporate Seal," and "Delaware."
The seal shall be in the charge of the secretary. The board of directors or
the finance committee may authorize a duplicate seal to be kept and used by
any other officer.
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6.4. Dividends on Preferred Stock.
All dividends declared upon the preferred stock shall be payable quarterly
upon the first day of February, May, August and November in each year, but if
that is a legal holiday, then on the next day not a legal holiday.
6.5. Fiscal Year.
The fiscal year of the corporation shall begin on January 1st and terminate
on December 31st in each year.
6.6. Annual Report.
At least fifteen days in advance of the annual meeting of stockholders, the
board of directors shall publish and submit to the stockholders consolidated
financial statements for the previous fiscal year. The board of directors
shall also publish consolidated financial statements for each of the first
three quarters of each fiscal year.
6.7. Notice.
Any notice required to be given by these by-laws may be given personally or
in writing by delivery to the United States postal system in a postpaid
envelope directed to such address as appears in the records of the
corporation, or, in default of other address, to the general post office in
Wilmington, New Castle County, Delaware. Such notice shall be deemed to be
given at the time of mailing, except as otherwise provided in these by-laws.
In addition, except as otherwise required by law or these by-laws, notice
need not be given of any adjourned meeting other than by announcement at the
meeting which is being adjourned.
6.8. Waiver of Notice.
Whenever any notice is required to be given, a waiver thereof in writing,
signed by the person or persons entitled to the notice, whether before or
after the time stated therein, shall be deemed equivalent thereto.
Attendance of a person at a meeting shall constitute a waiver of notice of
such meeting, except when the person attends a meeting for the express
purpose of objecting, at the beginning of the meeting, to the transaction of
any business because the meeting is not lawfully called or convened. Neither
the business to be transacted at, nor the purpose of, any regular or special
meeting of the stockholders, directors, or members of a committee of
directors need be specified in any written waiver of notice.
6.9. Voting of Stocks Owned by the Corporation.
The board of directors, the finance committee or the chairman of the board
may authorize any person, and delegate to one or more other officers, the
authority to authorize any person in behalf of the corporation to attend,
vote
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and grant proxies to be used at any meeting of stockholders of any
corporation in which General Motors Corporation may hold stock.
6.10. Form of Records.
Any records maintained by the corporation in the regular course of its
business, including its stock ledger, books of account, and minute books, may
be kept on, or be in the form of, punch cards, magnetic tape, photographs,
microphotographs, or any other information storage device, provided that the
records so kept can be converted into clearly legible form within a
reasonable time. The corporation shall so convert any records so kept upon
the request of any person entitled to inspect the same.
6.11. Amendment of By-Laws.
The board of directors shall have power to adopt, amend or repeal the by-laws
at any regular or special meeting of the directors. The stockholders shall
also have power to adopt, amend or repeal the by-laws at any annual or
special meeting, subject to compliance with the notice provisions provided in
section 2.11.
6.12. Anti-Greenmail.
(a) Vote Required for Certain Acquisitions of Securities. Except as set
forth in Subsection (b) hereof, in addition to any affirmative vote of
stockholders required by any provision of law, the certificate of
incorporation or by-laws of the corporation, or any policy adopted by the
board of directors, neither the corporation nor any subsidiary shall
knowingly effect any direct or indirect purchase or other acquisition of any
GM Equity Security of any class or classes issued by the corporation at a
price which is in excess of the highest Market Price of such GM Equity
Security on the largest principal national securities exchange in the United
States on which such security is listed for trading on the date that the
understanding to effect such transaction is entered into by the corporation
(whether or not such transaction is concluded or a written agreement relating
to such transaction is executed on such date, such date to be conclusively
established by determination of the board of directors), from any Interested
Person (i.e., any person who is the direct or indirect beneficial owner of
more than three percent (3%) of the aggregate voting power of the Voting
Shares of the corporation) who has beneficially owned such GM Equity
Securities for less than two years prior to such date, without the
affirmative vote of the holders of the Voting Shares which represent at least
a majority of the aggregate voting power of the corporation, excluding Voting
Shares beneficially owned by such Interested Person, voting together as a
single class. Such affirmative vote shall be required notwithstanding the
fact that no vote may be required, or that a lesser percentage may be
specified, by law or any agreement with any national securities exchange, or
otherwise.
(b) When A Vote Is Not Required. The provisions of Section (a) hereof shall
not be applicable with respect to:
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(i) any purchase, acquisition, redemption or exchange of GM Equity
Securities, the purchase, acquisition, redemption or exchange of
which, at the time any such transaction is entered into, is provided
for in the corporation's certificate of incorporation (including any
resolution or resolutions of the board of directors providing for
the issuance of Preferred Stock or Preference Stock by the
corporation);
(ii) any purchase or other acquisition of GM Equity Securities made
as part of a tender or exchange offer by the corporation to purchase
securities of the same class made on the same terms to all holders
of such securities and complying with the applicable requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the rules and regulations thereunder (or any successor
provisions to such Act, rules or regulations);
(iii) any purchase or acquisition of GM Equity Securities made
pursuant to an open market purchase program which has been approved
by the board of directors; or
(iv) any purchase or acquisition of GM Equity Securities made from,
or any purchase or acquisition of GM Equity Securities made pursuant
to or on behalf of, an employee benefit plan maintained by the
corporation, or any subsidiary or any trustee of, or fiduciary with
respect to any such plan when acting in such capacity.
(c) Interpretation of This By-Law. The board of directors shall have the
exclusive right and power to interpret the provisions of this by-law,
including, without limitation, the adoption of written definitions of terms
used in this by-law (any such definitions shall be filed with the Secretary,
and such definitions as may prevail shall be made available to any
stockholder upon written request); any such interpretation made in good faith
shall be binding and conclusive upon all holders of GM Equity Securities.
6.13. Gender Pronouns.
Whenever the masculine pronoun is used herein it shall be deemed to refer to
either the masculine or the feminine gender.
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DEFINITIONS OF CERTAIN TERMS
USED IN
AND
GUIDELINES FOR THE APPLICATION
OF
BY-LAW 2.12
OF
GENERAL MOTORS CORPORATION
Certain Definitions.
For the purposes of Section 2.12 of the By-Laws of General Motors
Corporation, (the "Corporation") the board of directors has adopted the
following definitions, effective January 7, 1991.
(i) "Affiliate" of a person, or a person "affiliated with," a
specified person, shall mean a person that directly, or indirectly
through one or more intermediaries, controls, or is controlled by,
or is under common control with, the specified person.
(ii) The term "control" (including the terms "controlling,"
"controlled by" and "under common control with") shall mean the
possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a person, whether
through the ownership of voting securities, by contract, or
otherwise; provided, however, that a person shall not be deemed to
control another person solely because he or she is a director of
such other person.
(iii) "GM Equity Security" shall mean any security described in
Section 3(a)(11) of the Exchange Act, as of the effective date
hereof, which is issued by GM and traded on a national securities
exchange or the NASDAQ National Market System.
(iv) A "subsidiary" of the Corporation shall mean any corporation a
majority of the voting stock of which is owned, directly or
indirectly through one or more other subsidiaries, by the
Corporation.
(v) The employment of a person by the Corporation or its
subsidiaries shall be deemed to be in an "executive capacity" during
the period that such person (A) served as an elected officer of the
Corporation or one of its subsidiaries, or (B) reported directly to
a person who served as an elected officer of the Corporation or one
of its subsidiaries.
(vi) A person shall be deemed to be, or to be affiliated with, a
company or firm that is a "significant advisor or consultant to the
corporation or its subsidiaries" if he, she or it, as the case may
be, received or would receive fees or similar compensation from the
Corporation or a subsidiary of the Corporation in excess of the
lesser of (A) three percent (3%) of the consolidated gross revenues
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which the Corporation and its subsidiaries received for the sale of
their products and services during the last fiscal year of the
Corporation; (B) five percent (5%) of the gross revenues of the
person during the last calendar year, if such person is a
self-employed individual, or (C) five percent (5%) of the
consolidated gross revenues received by such company or firm for the
sale of its products and services during its last fiscal year, if
the person is a company or firm; provided, however, that directors'
fees and expense reimbursements shall not be included in the gross
revenues of an individual for purposes of this determination.
(vii) A "significant customer of the corporation and its
subsidiaries" shall mean a customer from which the Corporation and
its subsidiaries collectively in the last fiscal year of the
Corporation received payments in consideration for the products and
services of the Corporation and its subsidiaries which are in excess
of three percent (3%) of the consolidated gross revenues of the
Corporation and its subsidiaries during such fiscal year.
(viii) A "significant supplier of the corporation and its
subsidiaries" shall mean a supplier to which the Corporation and its
subsidiaries collectively in the last fiscal year of the Corporation
made payments in consideration for the supplier's products and
services in excess of three percent (3%) of the consolidated gross
revenues of the Corporation and its subsidiaries during such fiscal
year.
(ix) The Corporation and its subsidiaries shall be deemed a
"significant customer of a company" if the Corporation and its
subsidiaries collectively were the direct source during such
company's last fiscal year of in excess of five percent (5%) of the
gross revenues which such company received for the sale of its
products and services during that year.
(x) The Corporation and its subsidiaries shall be deemed a
"significant supplier of a company" if the Corporation and its
subsidiaries collectively received in such company's last fiscal
year payments from such company in excess of five percent (5%) of
the gross revenues which such company received during that year for
the sale of its products and services.
(xi) A person shall be deemed to have "significant personal services
contract(s) with the corporation or its subsidiaries" if the fees
and other compensation received by the person pursuant to personal
services contract(s) with the Corporation or its subsidiaries
exceeded or would exceed five percent (5%) of his or her gross
revenues during the last calendar year.
(xii) A tax-exempt entity shall be deemed to receive "significant
contributions" from the Corporation or its subsidiaries if such tax-
exempt entity received during its last fiscal year, or expects to
receive during its current fiscal year, contributions from the
Corporation or its subsidiaries in excess of the lesser of either
(A) three percent (3%) of the consolidated gross revenues of the
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Corporation and its subsidiaries during its last fiscal year, or
(B) five percent (5%) of the contributions received by the
tax-exempt entity during its last fiscal year.
Guidelines for Application.
(i) For purposes of identifying payments for products and services
contemplated by the definitions set forth above, and performing the
related calculations, the board of directors may exclude payments
such as those described in paragraph 2 of the Instructions to
Paragraph (b) of Item 404 of Regulation S-K, as promulgated by the
Securities and Exchange Commission as of the effective date hereof.
(ii) The board of directors shall be entitled to rely upon the
completeness and accuracy of directors' responses to written
questionnaires circulated for the purpose of enabling the board of
directors to make the determinations of independence required by the
provisions of By-Law 2.12.
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SECURITIES ACT AND EXCHANGE ACT
PARAGRAPH 2 OF INSTRUCTIONS TO
PARAGRAPH (b) OF ITEM 404 OF REGULATION S-K
AS IN EFFECT ON JANUARY 7, 1991
(REFERRED TO IN PARAGRAPH (i) OF
GUIDELINES FOR APPLICATION OF BY-LAW 2.12 OF
GENERAL MOTORS CORPORATION)
2. In calculating payments for property and services the following may be
excluded:
A. Payments where the rates or charges involved in the transaction
are determined by competitive bids, or the transaction involves the
rendering of services as a common contract carrier, or public
utility, at rates or charges fixed in conformity with law or
governmental authority;
B. Payments that arise solely from the ownership of securities of
the registrant and no extra or special benefit not shared on a pro
rata basis by all holders of the class of securities is received; or
C. Payments made or received by subsidiaries other than significant
subsidiaries as defined in Rule 1-02(v) of Regulation S-X, provided
that all such subsidiaries making or receiving payments, when
considered in the aggregate as a single subsidiary, would not
constitute a significant subsidiary as defined in Rule 1-02(v).*
- ---------------------------
* The General Motors Legal Staff notes that Rule 1-02(v) of
Regulation S-X provides, generally, that a significant subsidiary of
General Motors Corporation would be one which, together with its
subsidiaries, meets any of the following conditions:
(1) General Motors' and its other subsidiaries' investments in and
advances to the subsidiary exceed ten percent (10%) of the total
assets of General Motors and its consolidated subsidiaries.
(2) General Motors' and its other subsidiaries' proportionate share
of the total assets (after intercompany eliminations) of the
subsidiary exceeds ten percent (10%) of the total assets of General
Motors and its consolidated subsidiaries.
(3) General Motors' and its other subsidiaries' equity in the
income from continuing operations before income taxes, extraordinary
items and cumulative effect of a change in accounting principle of
the subsidiary exceeds ten percent (10%) of such income of General
Motors and its consolidated subsidiaries.
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DEFINITION OF CERTAIN TERMS
USED IN BY-LAW 6.12
OF
GENERAL MOTORS CORPORATION
Certain Definitions.
For the purposes of Section 6.12 of the By-Laws of General Motors
Corporation, the board of directors has adopted the following definitions,
effective March 5, 1990:
(i) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act, as in effect on January 1, 1990.
(ii) "Beneficial Owner" and "Beneficial Ownership" shall have the
meanings ascribed to such terms in Rule 13d-3 and Rule 13d-5 of the
General Rules and Regulations under the Exchange Act, as in effect
on January 1, 1990.
(iii) "GM Equity Security" shall mean any security described in
Section 3(a) (11) of the Exchange Act, as in effect on January 1,
1990, which is issued by GM and traded on a national securities
exchange or the NASDAQ National Market System.
(iv) "Interested Person" shall mean any person (other than the
Corporation or any Subsidiary) that is the direct or indirect
Beneficial Owner of more than three percent (3%) of the aggregate
voting power of the Voting Shares, and any affiliate or associate of
any such person. For the purpose of determining whether a Person is
an Interested Person, the outstanding Voting Shares shall include
unissued shares of voting stock of the corporation of which the
Interested Person is the Beneficial Owner, but shall not include any
other shares of voting stock of the corporation which may be
issuable pursuant to any agreement, arrangement or understanding, or
upon exercise of conversion rights, warrants or options, or
otherwise, to any Person who is not the Interested Person.
(v) "Market Price" of shares of a class of GM Equity Security on any
day shall mean the highest sale price (regular way) of shares of
such class of GM Equity Security on such day, or, if that day is not
a trading day, on the trading day immediately preceding such day, on
the largest principal national securities exchange on which such
class of stock is then listed or admitted to trading, or if not
listed or admitted to trading on any national securities exchange,
then the highest reported sale price for such shares in the
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over-the-counter market as reported on the NASDAQ National Market
System, or if such sale prices shall not be reported thereon, the
highest bid price so reported, or, if such price shall not be
reported thereon, as the same shall be reported by the National
Quotation Bureau Incorporated; in the case of any GM Equity Security
which is the Preferred Stock or Preference Stock of the corporation
(of any series), the Market Price thereof shall be the Market Price,
as hereinabove defined, of the Voting Shares which the holder of
such Preferred Stock or Preference Stock may then acquire by reason
of the redemption, exchange, conversion or exercise of other rights
as may be provided for in the terms of such securities.
(vi) "Person" shall mean any individual, partnership, firm,
corporation, association, trust, unincorporated organization or
other entity, as well as any syndicate or group deemed to be a
person pursuant to Section 13(d)(3) of the Exchange Act, as in
effect on January 1, 1990.
(vii) "Subsidiary" shall mean any company of which the corporation
owns, directly or indirectly, (A) a majority of the outstanding
shares of equity securities, or (B) shares having a majority of the
voting power represented by all of the outstanding voting stock of
such company. For the purpose of determining whether a company is a
Subsidiary, the outstanding voting stock and shares of equity
securities thereof shall include unissued shares of which the
corporation is the Beneficial Owner but, except for the purpose of
determining whether a company is a Subsidiary for purposes of the
definition of Interested Person as used in By-Law Section 6.12,
shall not include any other shares which may be issuable pursuant to
any agreement, arrangement or understanding, or upon the exercise of
conversion rights, warrants or options, or otherwise, to any Person
who is not the corporation.
(viii) "Voting Shares" shall mean the outstanding shares of capital
stock of the corporation entitled to vote generally in the election
of directors.
vi
