SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 9, 1997
McDONALD'S CORPORATION
(Exact name of Registrant as specified in its Charter)
Delaware 1-5231 36-2361282
(State of Incorporation) (Commission File No.) (IRS Employer
Identification No.)
One McDonald's Plaza
Oak Brook, Illinois 60521
(630) 623-3000
(Address and Phone Number of Principal Executive Offices)
<PAGE>
Item 5. Other Events
On January 14, 1997, McDonald's Corporation issued $150,000,000 7 1/2%
Subordinated Deferrable Interest Debentures due 2037.
(c) Exhibits
1 Underwriting Agreement dated January 9, 1997, by and among
McDonald's Corporation, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Goldman, Sachs & Co., J. P. Morgan Securities Inc.,
Morgan Stanley & Co. Incorporated, PaineWebber Incorporated,
Prudential Securities Incorporated, Salomon Brothers Inc, and
Smith Barney Inc.
3(i) Corrected Restated Certificate of Incorporation of McDonald's
Corporation effective as of December 13, 1996
3(ii) By-Laws of McDonald's Corporation effective as of January 21,
1997
4(a) Supplemental Indenture No. 2, dated as of January 14, 1997,
supplemental to the Subordinated Debt Securities Indenture dated
as of October 18, 1996, between McDonald's Corporation and First
Union National Bank, as Trustee
4(b) Specimen Debenture
8 Tax Opinion
23 Consent of Paul J. Schaffhausen, Federal Tax Counsel of
McDonald's Corporation, is included in Exhibit 8
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.
McDONALD'S CORPORATION
(Registrant)
By: /s/ G. Lowell Dixon
-------------------------
G. Lowell Dixon
Vice President, Assistant General Counsel
and Assistant Secretary
<PAGE>
Exhibit Index
Exhibit
No. Description of Exhibit
-------- ----------------------
1 Underwriting Agreement dated January 9, 1997, by and among
McDonald's Corporation, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Goldman, Sachs & Co., J.P. Morgan Securities Inc.,
Morgan Stanley & Co. Incorporated, PaineWebber Incorporated,
Prudential Securities Incorporated, Salomon Brothers Inc, and Smith
Barney Inc.
3(i) Corrected Restated Certificate of Incorporation of McDonald's
Corporation effective as of December 13, 1996
3(ii) By-Laws of McDonald's Corporation effective as of January 21, 1997
4(a) Supplemental Indenture No. 2, dated as of January 14, 1997,
supplemental to the Subordinated Debt Securities Indenture dated as
of October 18, 1996, between McDonald's Corporation and First Union
National Bank, as Trustee
4(b) Specimen Debenture
8 Tax Opinion
23 Consent of Paul J. Schaffhausen, Federal Tax Counsel of McDonald's
Corporation, is included in Exhibit 8
EXHIBIT 1
McDONALD'S CORPORATION
UNDERWRITING AGREEMENT
To the Representatives named in Schedule I hereto of
the Underwriters named in Schedule II hereto
Dear Sirs:
1. Introductory. McDonald's Corporation (the ``Company''), a Delaware
corporation, proposes to sell to the underwriters named in Schedule II hereto
(the ``Underwriters''), for whom you are acting as representatives (the
``Representatives'', which term may refer to a single Representative if so
indicated on Schedule I hereto), the principal amount of its securities
identified in Schedule I hereto (the ``Securities''), to be issued under an
Indenture, dated as of October 18, 1996 as supplemented by Supplemental
Indenture No. 2 to be dated as of January 14, 1997 (collectively, the
``Indenture''), between the Company and First Union National Bank, as trustee
(the ``Trustee''). (If the firm or firms listed in Schedule II hereto include
only the firm or firms listed in Schedule I hereto, then the terms
``Underwriters'' and ``Representatives,'' as used herein, shall each be deemed
to refer to such firm or firms.)
2. Representations and Warranties of the Company. The Company represents
and warrants to each of the Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission (the
``Commission'') a registration statement on Form S-3 under the Securities Act
of 1933, as amended (the ``Securities Act '') (File No. 333-14141), which has
become effective, for the registration under the Securities Act of the
Securities. Such registration statement meets the requirements set forth in
Rule 415(a)(1)(i) under the Securities Act and complies in all other material
respects with said Rule. The Company proposes to file with the Commission
pursuant to Rule 424(b)(2) or (b)(5) under the Securities Act a supplement to
the form of prospectus included in registration statement File No. 333-14141
relating to the Securities and the plan of distribution thereof or, if the
Company elects to rely on Rule 434 under the Securities Act, a Term Sheet (as
such term is hereinafter defined) relating to the Securities that shall
contain such information as is required or permitted by Rules 434 and 424(b)
under the Securities Act. The registration statement File No. 333-14141,
including the exhibits thereto, is hereinafter called the ``Registration
Statement;'' the prospectus in the form in which it appears in registration
statement File No. 333-14141, is hereinafter called the ``Basic Prospectus;''
and such supplemented form of prospectus, in the form in which it shall be
filed with the Commission pursuant to Rule 424(b)(2) or (b)(5) (including the
Basic Prospectus as so supplemented) or, if the Company elects to rely on Rule
434 under the Securities Act, in the form of the Term Sheet as first filed
with the Commission pursuant to Rule 424(b)(7) (together with the Basic
Prospectus), is hereinafter called the ``Final Prospectus.'' Any preliminary
form of the Final Prospectus which has heretofore been filed pursuant to Rule
424(b) is hereinafter called the ``Preliminary Final Prospectus." Any
abbreviated term sheet that satisfies the requirements of Rule 434 under the
Securities Act is hereinafter called the ``Term Sheet.'' Any reference herein
to the Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Securities Exchange Act of 1934, as amended (the
``Exchange Act'') on or before the date of this Agreement, or the issue date
of the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus, as the case may be; and any reference herein to the terms
``amend,'' ``amendment'' or ``supplement'' with respect to the Registration
Statement, the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus shall be deemed to refer to and include the filing of any document<PAGE>
under the Exchange Act after the date of this Agreement, or the issue date of
the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus, as the case may be, and deemed to be incorporated therein by
reference.
(b) As of the date hereof, when the Final Prospectus is first filed
pursuant to Rule 424(b) under the Securities Act, when, prior to the Closing
Date (as hereinafter defined), any amendment to the Registration Statement
becomes effective (including the filing of any document incorporated by
reference in the Registration Statement), when any supplement to the Final
Prospectus is filed with the Commission and at the Closing Date (as
hereinafter defined), (i) the Registration Statement, as amended as of any
such time, the Final Prospectus, as amended or supplemented as of any such
time, and the Indenture will comply in all material respects with the
applicable requirements of the Securities Act, the Trust Indenture Act of
1939, as amended (the ``Trust Indenture Act '') and the Exchange Act and the
respective rules and regulations thereunder and (ii) neither the Registration
Statement, as amended as of any such time, nor the Final Prospectus, as
amended or supplemented as of any such time, will contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not misleading;
provided, however, that the Company makes no representations or warranties as
to (i) that part of the Registration Statement which shall constitute the
Statement of Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee, (ii) information, if any, contained in the Registration Statement or
Final Prospectus relating to the Depository Trust Company (``DTC'') and its
book-entry system, or (iii) the information contained in or omitted from the
Registration Statement or the Final Prospectus or any amendment thereof or
supplement thereto in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter through
the Representatives specifically for use in connection with the preparation of
the Registration Statement and the Final Prospectus.
(c) The financial statements of the Company and its consolidated
subsidiaries included in the Registration Statement fairly present the
financial condition of the Company and its consolidated subsidiaries as of the
dates indicated and the results of operations and cash flow for the periods
therein specified; and said financial statements have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis throughout the periods involved, except as otherwise stated
therein. As used herein, ``consolidated subsidiaries '' means each subsidiary
of the Company which is included in the consolidated financial statements of
the Company contained in its annual report to shareholders for 1995 in
accordance with the consolidation policies set forth therein or which would
have been so included if it had been a subsidiary of the Company as of the
date of such consolidated financial statements, and each other subsidiary of
the Company which is included in consolidated financial statements of the
Company prepared from time to time thereafter.
(d) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Final Prospectus and prior to the Closing
Date hereinafter mentioned, except as set forth or contemplated in the Final
Prospectus, (1) neither the Company nor any of its consolidated subsidiaries
has entered into any transaction not in the ordinary course of business which
is material to the Company and its consolidated subsidiaries, considered as a
whole, (2) there has been no material adverse change in the properties,
business, financial condition or results of operations of the Company and its
consolidated subsidiaries, considered as a whole, and (3) no legal or
governmental proceeding, which has or will have materially affected the
Company or any of its consolidated subsidiaries, considered as a whole, or the
transactions contemplated by this Agreement, has been or will have been
instituted or threatened.
(e) The Company and each of its Significant Subsidiaries (herein defined to
mean the list of the Company's domestic and foreign subsidiaries appearing in
Exhibit 21 to the Company's Annual Report on Form 10-K for the year ended
December 31, 1995) have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective states or
jurisdictions of incorporation, with corporate power and authority to own
their properties and to conduct their business as described in the Basic
Prospectus and Final Prospectus. The Company and each of its Significant
Subsidiaries are duly qualified to do business as foreign corporations and are
in good standing in all states or jurisdictions in which the ownership or
lease of real property or the conduct of business requires such
qualifications, except where failure to be so qualified cannot be reasonably
expected to have a material adverse effect on the financial condition of the
Company and its consolidated subsidiaries, considered as a whole. The Company
owns all of the issued and outstanding shares of capital stock of each of the
Significant Subsidiaries, directly or indirectly through one or more
Significant Subsidiaries (except McDonald's Australia Limited and McDonald's
Property Company Limited, of which the Company directly or indirectly owns a
majority of the capital stock), and all of such shares of the Significant
Subsidiaries are owned free and clear of any liens, charges and encumbrances.
(f) The consummation of the transactions herein contemplated and the
fulfillment of the terms hereof will not (i) conflict with or result in a
breach of any of the terms and provisions of, or constitute a default under,
the Restated Certificate of Incorporation or By-Laws of the Company as
presently in effect or (ii) conflict with or result in a breach of any of the
terms and provisions of, or constitute a default under, any indenture,
mortgage, deed of trust or other agreement or instrument to which the Company
is a party, or any order, rule or regulation applicable to the Company of any
court or of any federal or state regulatory body or administrative agency or
other governmental body having jurisdiction over the Company or any of its
properties, except such conflicts, breaches or defaults referred to in this
subclause (ii) which would not materially and adversely affect the Company and
its consolidated subsidiaries considered as a whole.
(g) The Securities have been duly and validly authorized and, when issued,
authenticated and delivered against payment therefor in accordance with the
terms of the Indenture and this Agreement, will constitute valid and legally
binding obligations of the Company entitled to the benefits of the Indenture,
except as enforcement thereof may be limited by applicable bankruptcy,
insolvency, moratorium and other laws affecting the enforceability of
creditors' rights and general principles of equity, and will conform to the
description thereof contained in the Final Prospectus. The Indenture has been
duly authorized by the Company and will be a valid and legal instrument
enforceable in accordance with its terms, except as enforcement thereof may be
limited by applicable bankruptcy, insolvency, moratorium and other laws
affecting the enforceability of creditors' rights and general principles of
equity. The Indenture is duly qualified under the Trust Indenture Act.
3. Sale, Purchase and Delivery of Securities. On the basis of the
representations and warranties herein contained, but subject to the terms and
conditions herein set forth, the Company hereby agrees to sell to the
Underwriters, severally and not jointly, and each Underwriter, severally and
not jointly (unless otherwise indicated on Schedule I hereto), agrees to
purchase from the Company, at the purchase price set forth in Schedule I
hereto, the principal amount of the Securities set forth opposite such
Underwriter's name in Schedule II hereto, except that, if Schedule I hereto
provides for the sale of Securities pursuant to delayed delivery arrangements,
the respective principal amounts of Securities to be purchased by the
Underwriters shall be as set forth in Schedule II hereto, less the respective
amounts of Contract Securities determined as provided below. Securities to be
purchased by the Underwriters are herein sometimes called the ``Underwriters'
Securities'' and Securities to be purchased pursuant to Delayed Delivery
Contracts as hereinafter provided are herein called ``Contract Securities''.<PAGE>
If so provided in Schedule I hereto, the Underwriters are authorized to
solicit offers to purchase Securities from the Company pursuant to delayed
delivery contracts (``Delayed Delivery Contracts''), substantially in the form
of Schedule III hereto but with such changes therein as the Company may
authorize or approve. The Underwriters will endeavor to make such arrangements
and, as compensation therefor, the Company will pay to the Representatives,
for the account of the Underwriters, on the Closing Date, the percentage set
forth in Schedule I hereto of the principal amount of the Securities for which
Delayed Delivery Contracts are made. Delayed Delivery Contracts are to be with
institutional investors, including commercial and savings banks, insurance
companies, pension funds, investment companies and educational and charitable
institutions. The Company will make Delayed Delivery Contracts in all cases
where sales of Contract Securities arranged by the Underwriters have been
approved by the Company but, except as the Company may otherwise agree, each
such Delayed Delivery Contract must be for not less than the minimum principal
amount set forth in Schedule I hereto and the aggregate principal amount of
Contract Securities may not exceed the maximum aggregate principal amount set
forth in Schedule I hereto. The Underwriters will not have any responsibility
in respect of the validity or performance of Delayed Delivery Contracts. The
principal amount of Securities to be purchased by each Underwriter as set
forth in Schedule II hereto shall be reduced by an amount which shall bear the
same proportion to the total principal amount of Contract Securities as the
principal amount of Securities set forth opposite the name of such Underwriter
bears to the aggregate principal amount set forth in Schedule II hereto,
except to the extent that you determine that such reduction shall be otherwise
than in such proportion and so advise the Company in writing; provided,
however, that the total principal amount of Securities to be purchased by all
Underwriters shall be the aggregate principal amount set forth in Schedule II
hereto, less the aggregate principal amount of Contract Securities.
Delivery of and payment for the Underwriters' Securities shall be made at
the office, on the date and at the time specified in Schedule I hereto, which
date and time may be postponed by agreement between the Representatives and
the Company or as provided in Section 9 hereof (such date and time of delivery
and payment for the Underwriters' Securities being herein called the ``Closing
Date"). Delivery of the Underwriters' Securities shall be made to the
Representatives for the respective accounts of the several Underwriters
against payment by the several Underwriters through the Representatives of the
purchase price thereof to or upon the order of the Company in Federal (same
day) funds, or, if so indicated on Schedule I hereto, in New York
Clearinghouse (next day) funds. Certificates for the Underwriters' Securities
shall be registered in such names and in such denominations as the
Representatives may request not less than two full business days in advance of
the Closing Date.
The Company agrees to have the Underwriters' Securities available for
inspection, checking and packaging by the Representatives in New York, New
York, not later than 1:00 PM on the business day prior to the Closing Date.
If so provided in Schedule I hereto, Underwriters' Securities will be
represented by one or more definitive global Securities in book-entry form
which will be deposited by or on behalf of the Company with DTC or DTC's
designated custodian. In such case, (a) delivery of the Underwriters'
Securities shall be made to the Representatives for the respective accounts of
the several Underwriters by causing DTC to credit the Underwriters' Securities
to the account of the Representatives at DTC, and (b) the Company will cause
the certificates representing the Underwriters' Securities to be made
available to the Representatives for inspection not later than 1:00 p.m., New
York City time, on the business day prior to the Closing Date at the office of
DTC or its designated custodian.
4. Covenants of the Company. The Company covenants and agrees with the
Underwriters that:
(a) Prior to the termination of the offering of the Securities, the Company
will not file any amendment to the Registration Statement or supplement
(including the Final Prospectus) to the Basic Prospectus unless the Company
has furnished you a copy for your review prior to filing, and the Company will
not file any such proposed amendment or supplement to which you reasonably
object. Subject to the foregoing sentence, the Company will cause the Final
Prospectus to be filed with the Commission pursuant to Rule 424 and/or Rule
434 under the Securities Act. The Company will promptly advise the
Representatives (i) when the Final Prospectus shall have been filed with the
Commission pursuant to Rule 424 and/or Rule 434 under the Securities Act, (ii)
when any amendment to the Registration Statement relating to the Securities
shall have become effective, (iii) of any request by the Commission for any
amendment of the Registration Statement or amendment of or supplement to the
Final Prospectus or for any additional information, (iv) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding for
that purpose and (v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of any
such stop order and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) The Company will prepare and file with the Commission, promptly upon
the request of the Representatives, any amendments or supplements to the
Registration Statement or Final Prospectus which, in the opinion of counsel
for the Underwriters, may be necessary to enable the several Underwriters to
continue the sale of the Securities, and the Company will use its best efforts
to cause any such amendments to become effective and any such supplements to
be filed with the Commission and approved for use by the Underwriters as
promptly as possible. If at any time when a prospectus relating to the
Securities is required to be delivered under the Securities Act, any event
relating to or affecting the Company occurs as a result of which the Final
Prospectus as then amended or supplemented would include an untrue statement
of a material fact, or omit to state any material fact necessary to make the
statement therein not misleading, or if it is necessary at any time to amend
or supplement the Final Prospectus to comply with the Securities Act or the
Exchange Act or the respective rules thereunder, the Company promptly will
prepare and file with the Commission, subject to the first sentence of
paragraph (a) of this Section 4, an amendment or supplement which will correct
such statement or omission or which will effect such compliance. For the
purposes of this paragraph (b), the Company will furnish such information with
respect to itself as the Representatives may from time to time reasonably
request.
(c) As soon as practicable, but not later than 90 days after the end of the
12-month period beginning at the end of the current fiscal quarter of the
Company, the Company will make generally available to its security holders and
you an earnings statement covering a period of at least twelve months
beginning not earlier than said effective date which shall satisfy the
provisions of Section 11(a) of the Securities Act.
(d) The Company will furnish to the Representatives and counsel for the
Underwriters, without charge, copies of the Registration Statement (including
exhibits thereto and documents incorporated by reference therein) and each
amendment thereto which shall become effective on or prior to the Closing Date
and, so long as delivery of a prospectus by an Underwriter or dealer may be
required by the Securities Act, as many copies of any Preliminary Final
Prospectus and the Final Prospectus and any amendments thereof and supplements
thereto as the Representatives may reasonably request. The Company will pay
the expenses of printing all documents relating to the offering.
(e) The Company will furnish such information and execute such instruments
as may be required to qualify the Securities for sale under the securities or
blue sky laws of such jurisdictions within the United States as you designate,
will continue such qualifications in effect so long as required for
distribution and will arrange for the determination of the legality of the
Securities for purchase by institutional investors. The Company shall not be
required to register or qualify as a foreign corporation nor, except as to
matters and transactions relating to the offer and sale of the Securities,
consent to service of process in any jurisdiction.
(f) So long as the Securities shall be outstanding, the Company will
deliver to you (i) as soon as practicable after the end of each fiscal year,
consolidated balance sheets, statements of income, retained earnings and cash
flows of the Company and its consolidated subsidiaries, as at the end of and
for such year and the last preceding year, all in reasonable detail and
audited by independent public accountants, (ii) as soon as practicable after
the end of each of the first three quarterly periods in each fiscal year,
unaudited consolidated balance sheets, statements of income, retained earnings
and cash flows of the Company and its consolidated subsidiaries, as at the end
of and for such period and for the comparable period of the preceding year,
all in reasonable detail, (iii) as soon as available, all such proxy
statements, financial statements and reports as the Company shall send or make
available to its stockholders generally, and (iv) copies of all such annual,
periodic and current reports as the Company or any subsidiary shall file with
the Commission or any securities exchange.
(g) The Company will apply for the listing of the Securities on the New
York Stock Exchange, Inc. if requested to do so by you.
(h) The Company will pay all costs and expenses in connection with the
transactions herein contemplated, including, but not limited to, the fees and
disbursements of its counsel; the fees, costs and expenses of preparing,
printing and delivering the Indenture and the Securities; the fees, costs and
expenses of the Trustee; accounting fees and disbursements; the costs and
expenses in connection with the qualification or exemption of the Securities
under state securities or blue sky laws, including filing fees and reasonable
fees and disbursements of counsel for the Underwriters in connection therewith
and in connection with any Blue Sky Memorandum; the costs and expenses in
connection with the preparation, printing and filing of the Registration
Statement (including exhibits thereto) and the Basic, Preliminary Final, and
Final Prospectus, the preparation and printing of this Agreement and the
furnishing to the Underwriters of such copies of each prospectus as the
Underwriters may reasonably require; and the fees of rating agencies. It is
understood, however, that, except as provided in this Section and in Sections
7 and 8 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel and any advertising expenses connected
with any offers they may make.
(i) Until the business day following the Closing Date, the Company will
not, without the consent of the Representatives, offer or sell, or announce
the offering of, any debt securities (other than up to $150,000,000 principal
amount of the Company's medium term notes to be issued pursuant to the
Company's Registration Statements on Form S-3 (File Nos. 33-42642 and 33-
60939)) covered by the Registration Statement or any other registration
statement filed under the Securities Act.
5. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Securities shall be
subject to the accuracy of the representations and warranties on the part of
the Company contained herein as of the date hereof, as of the date of the
effectiveness of any amendment to the Registration Statement filed prior to
the Closing Date (including the filing of any document incorporated by
reference therein) and as of the Closing Date, to the accuracy of the written
statements of Company officers made pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following
additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall have been issued and no
proceedings for that purpose shall have been instituted or shall be pending,
or, to the knowledge of the Company, shall be contemplated by the Commission.
(b) No event, nor any material adverse change in the condition of the
Company, financial or otherwise, shall have occurred, nor shall any event
exist which makes untrue or incorrect any material statement or information
contained in the Registration Statement or the Final Prospectus or which is
not reflected in the Registration Statement or the Final Prospectus, but
should be reflected therein in order to make the statements or information
contained therein not misleading.
(c) You shall not have advised the Company that the Registration Statement
or any prospectus, or any amendment or supplement thereto, contains an untrue
statement of fact which, in the opinion of counsel for the Underwriters, is
material, or omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make the
statements therein not misleading.
(d) You shall have received at the Closing Date (or prior thereto as
indicated) the following:
(i) An opinion from Gloria Santona, Vice President, Associate General
Counsel and Secretary, or a Vice President and Assistant General Counsel of
the Company, dated the Closing Date, to the effect that:
(A) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware with
corporate power and authority to own its properties and conduct its business
as described in the Final Prospectus.
(B) The Indenture has been duly authorized, executed and delivered by
the Company and the Trustee, is duly qualified under the Trust Indenture Act,
and is a valid and legally binding obligation of the Company enforceable in
accordance with its terms, except as enforcement thereof may be limited by
applicable bankruptcy, insolvency, moratorium and other laws affecting the
enforceability of creditors' rights and general principles of equity.
(C) The Securities have been duly and validly authorized by all
necessary corporate action and, when duly executed on behalf of the Company,
duly authenticated by the Trustee or the Trustee's authenticating agent, and
duly delivered to the several Underwriters against payment therefor in
accordance with the provisions of this Agreement, in the case of the
Underwriters' Securities, or to the purchasers thereof pursuant to Delayed
Delivery Contracts, in the case of Contract Securities, will constitute legal,
valid and binding obligations of the Company enforceable in accordance with
their terms and entitled to all the benefits of the Indenture, except as
enforcement thereof may be limited by applicable bankruptcy, insolvency,
moratorium and other laws affecting the enforceability of creditors' rights
and general principles of equity.
(D) The Indenture and the Securities conform as to legal matters with
the statements concerning them made in the Final Prospectus, and such
statements accurately set forth the provisions thereof required to be set
forth in the Final Prospectus.
(E) This Agreement and any Delayed Delivery Contracts have been
validly authorized, executed and delivered on behalf of the Company.
(F) The Registration Statement and any amendments thereto have become
effective under the Securities Act, and, to the best of the knowledge of such
counsel, no stop order suspending the effectiveness of the Registration
Statement, as amended, has been issued and no proceedings for that purpose
have been instituted or are pending or contemplated under the Securities Act,
and the Registration Statement, the Final Prospectus, and each amendment
thereof or supplement thereto (except for the financial statements and other
financial data included therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the requirements of
the Securities Act and the Exchange Act and the respective rules thereunder;
such counsel has no reason to believe that either the Registration Statement
or the Final Prospectus, or any such amendment or supplement, contains any
untrue statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; the descriptions in the Registration Statement and Final
Prospectus of statutes, legal and governmental proceedings and contracts and
other documents are accurate and fairly present the information required to be
shown; and such counsel does not know of any legal or governmental proceedings
required to be described in the Final Prospectus which are not described as
required, nor of any contracts or documents of a character required to be
described in the Registration Statement or Final Prospectus or to be filed as
exhibits to the Registration Statement which are not described and filed as
required.
(G) The consummation of the transactions herein contemplated and the
fulfillment of the terms hereof or of any Delayed Delivery Contracts will not
result in a breach of any of the terms and provisions of, or constitute a
default under, any indenture, mortgage, deed of trust or other agreement or
instrument to which, to the knowledge of such counsel, the Company is a party,
or the Restated Certificate of Incorporation or By-Laws of the Company as
presently in effect or, to the knowledge of such counsel, any order, rule or
regulation applicable to the Company of any court or of any federal or state
regulatory body or administrative agency or other governmental body having
jurisdiction over the Company or its properties.
(H) No authorization, approval, consent or other action of any
governmental authority or agency is required in connection with the sale of
the Securities as contemplated by this Agreement or in any Delayed Delivery
Contracts except such as may be required under the Securities Act or under
state securities or blue sky laws.
(ii) Such opinion or opinions of counsel for the Underwriters, dated the
Closing Date, with respect to the sufficiency of all corporate proceedings and
other legal matters relating to this Agreement, any Delayed Delivery
Contracts, the validity of the Securities, the Registration Statement, the
Final Prospectus and other related matters as you may reasonably request. The
Company shall have furnished to such counsel such documents as they may
reasonably request for the purpose of enabling them to render their opinions.
In connection with such opinions, such counsel may rely on representations or
certificates of officers of the Company.
(iii) A certificate of the President or a Vice President, and the Chief
Financial Officer of the Company or its Treasurer, dated the Closing Date, to
the effect that:
(A) The representations and warranties of the Company in Section 2 of
this Agreement are true and correct as of the Closing Date, and the Company
has complied with all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing Date.
(B) No stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the respective signers of
the certificate, are contemplated under the Securities Act.
(C) The signers of the certificate have carefully examined the
Registration Statement and the Final Prospectus; neither the Registration
Statement, the Final Prospectus nor any amendment or supplement thereto
includes, as of the Closing Date, any untrue statement of a material fact or
omits, as of the Closing Date, to state any material fact required to be
stated therein or necessary to make the statements therein not misleading;
since the latest respective dates as of which information is given in the
Registration Statement, there has been no material adverse change in the
financial position, business or results of operations of the Company and its
consolidated subsidiaries, considered as a whole, except as set forth in or
contemplated by the Final Prospectus; and since the effective date of the
Registration Statement, as amended, no event has occurred which is required to
be set forth in the Final Prospectus which has not been so set forth.
(iv) A letter from Ernst & Young LLP, dated the Closing Date, addressed
to you substantially in the form heretofore approved by you.
(v) An opinion from Paul J. Schaffhausen, Assistant Vice President and
Federal Tax Counsel to the Company, as to certain United States federal income
tax considerations in the form reasonably agreed upon.
(e) Prior to the Closing Date, the Company shall have furnished to you such
further certificates and documents as you may reasonably request.
(f) The Company shall have accepted Delayed Delivery Contracts in any case
where sales of Contract Securities arranged by the Underwriters have been
approved by the Company.
If any condition of the Underwriters' obligations hereunder required to be
satisfied prior to the Closing Date is not so satisfied, this Agreement may be
terminated by you by notice in writing or by facsimile transmission to the
Company.
In rendering the opinions described in Sections 5(d)(i) and (ii) above, Ms.
Gloria Santona, other counsel for the Company, and counsel for the
Underwriters may, as to matters involving the laws of any state other than
Illinois, rely upon the opinion or opinions of local counsel satisfactory to
you, but in such case a signed copy of each such opinion shall be furnished to
you.
All such opinions (including opinions, if any, of local counsel) ,
certificates, letters and documents will be in compliance with the provisions
hereof only if they are in all material respects satisfactory to you and to
counsel for the Underwriters, as to which both you and such counsel shall act
reasonably. The Company will furnish you with such conformed copies of such
opinions, certificates, letters and documents as you request.
You, on behalf of the Underwriters, may waive in writing the compliance by
the Company of any one or more of the foregoing conditions or extend the time
for their performance.
6. Representation of the Underwriters. Each of the Underwriters severally
represents and warrants to the Company that the information furnished to the
Company in writing by such Underwriter or by you expressly for use in the
preparation of the Registration Statement or the Final Prospectus does not,
and any amendments thereof or supplements thereto thus furnished will not,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading.
7. Termination of Agreement. This Agreement may be terminated by you on
behalf of the Underwriters by notice in writing delivered to the Company prior
to the Closing Date if prior to such time (i) trading in the Company's common<PAGE>
stock shall have been suspended by the Commission on the New York Stock
Exchange for a period of twenty-four hours or more or trading in securities
generally on the New York Stock Exchange shall have been suspended or
materially limited, in either case to such a degree as would in your judgment
materially adversely affect the market for the Securities; (ii) a general
moratorium on commercial banking activities in the State of New York or the
United States shall have been declared by Federal authorities; or (iii) there
has occurred any material outbreak, or material escalation, of hostilities
involving the United States or other national or international calamity or
crisis, of such magnitude and severity in its effect on the financial markets
of the United States, in your reasonable judgment, as to prevent or materially
impair the marketing, or enforcement of contracts for sale, of the Securities.
If this Agreement shall be terminated by you because of any failure on the
part of the Company to comply with any of the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Company shall be unable
to perform its obligations under this Agreement, the Company shall pay, in
addition to the costs and expenses referred to in Section 4(h), all reasonable
out-of-pocket expenses incurred by the Underwriters in contemplation of the
performance by them of their obligations hereunder, including but not limited
to the reasonable fees and disbursements of counsel for the Underwriters, the
Underwriters' reasonable printing and traveling expenses, and postage and
telephone charges relating directly to the offering contemplated by the Final
Prospectus, and also including advertising expenses incurred after the
effective date of the Registration Statement, it being understood that such
out-of-pocket expenses shall not include any compensation, salaries or wages
of the officers, partners or employees of any of the Underwriters.
The Company shall not in any event be liable to the several Underwriters
for damages on account of loss of anticipated profits arising out of the
transactions contemplated by this Agreement.
8. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of the Securities Act or the Exchange Act
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter or such controlling person may become subject, under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement or any amendment thereof, the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse each Underwriter and each such controlling person for any legal
or other expenses reasonably incurred by such Underwriter or such controlling
person in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf
of any Underwriter through the Representatives specifically for use in the
preparation thereof; and provided, further, that the foregoing indemnification
with respect to the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus shall not inure to the benefit of any Underwriter (or any
person controlling such Underwriter) from whom the person asserting any such
loss, claim, damage or liability purchased the Securities, if such Underwriter
failed to send or give copies of the Final Prospectus, as amended or
supplemented, excluding documents incorporated therein by reference, to such
person at or prior to the written confirmation of the sale of such Securities
to such person in any case where such delivery is required by the Securities
Act and the untrue statement or omission of a material fact contained in the
Basic Prospectus or any Preliminary Final Prospectus was corrected in the
Final Prospectus (or the Final Prospectus as amended or supplemented). This
indemnity agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, each person, if any, who controls the Company either within the
meaning of the Securities Act or the Exchange Act, each of its directors and
each of its officers who has signed the Registration Statement, against any
losses, claims, damages or liabilities to which the Company, any such
controlling person or any such director or officer may become subject, under
the Securities Act, the Exchange Act, or otherwise, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through you specifically for use
in the preparation of the documents referred to in the foregoing indemnity.
This indemnity agreement will be in addition to any liability which any
Underwriter may otherwise have. The Company acknowledges that the statements
set forth in the last paragraph of the cover page of the Final Prospectus and
under the heading "Underwriting" or "Plan of Distribution" and, if Schedule
I hereto provides for sale of Securities pursuant to delayed delivery
arrangements, in the last sentence under the heading ``Delayed Delivery
Arrangements'' in the Final Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for inclusion
in the Final Prospectus, and you confirm that such statements are correct.
This indemnity agreement will be in addition to any liability which each such
Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
this Section, notify the indemnifying party in writing of the commencement
thereof, but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise
than under this Section. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate in and, to the
extent that it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, to
assume the defense thereof, with counsel satisfactory to such indemnified
party; provided, however, that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different from or
in addition to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assume
such legal defenses and to otherwise participate in the defense of such action
on behalf of such indemnified party or parties. Upon receipt by such
indemnified party of notice from the indemnifying party of its election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed such counsel in connection with the
assumption of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel,
approved by the Representatives of the Underwriters in the case of
subparagraph (a), representing the indemnified parties under subparagraph (a)
or (b), as the case may be, who are parties to such action), (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action or (iii) the indemnifying party has
authorized the employment of counsel for the indemnified party at the expense
of the indemnifying party; provided, further, that, with respect to legal and
other expenses incurred by an indemnified party for which an indemnifying
party shall be liable hereunder, all such legal fees and expenses shall be
reimbursed by the indemnifying party as they are incurred.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in paragraph (a) of
this Section 8 is due in accordance with its terms but is for any reason held
by a court to be unavailable from the Company on grounds of policy or
otherwise, the Company and the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to
which the Company and one or more of the Underwriters may be subject in such
proportion so that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount bears to the sum
of such discount and the purchase price of the Securities set forth in
Schedule I hereto and the Company is responsible for the balance; provided,
however, that (i) in no case shall any Underwriter (except as may be provided
in any agreement among underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting
discount applicable to the Securities purchased by such Underwriter hereunder
and (ii) no person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 8, each person who controls an Underwriter within the
meaning of the Securities Act shall have the same rights to contribution as
such Underwriter, and each person who controls the Company within the meaning
of either the Securities Act or the Exchange Act, each officer of the Company
who shall have signed the Registration Statement and each director of the
Company shall have the same rights to contribution as the Company, subject in
each case to clause (i) of this paragraph (d). Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this paragraph
(d), notify such party or parties from whom contribution may be sought, but
the omission to so notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any other obligation it or
they may have hereunder or otherwise than under this paragraph (d).
9. Default by an Underwriter. If the Underwriters' obligations to purchase
Securities pursuant to Section 3 hereof are several and not joint and if any
one or more Underwriters shall fail to purchase and pay for any of the
Securities agreed to be purchased by such Underwriter or Underwriters
hereunder and such failure to purchase shall constitute a default in the
performance of its or their obligations under this Agreement and unless
otherwise provided in Schedule I hereto, the remaining Underwriters shall be
obligated severally to take up and pay for (in the respective proportions
which the amount of Securities set forth opposite their names in Schedule II
hereto bear to the aggregate amount of Securities set opposite the names of
all the remaining Underwriters) the Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase; provided, however,
that in the event that the aggregate amount of Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of
the aggregate amount of Securities set forth in Schedule II hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this Agreement
will terminate without liability to any nondefaulting Underwriter or the
Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
seven days, as the Representatives shall determine in order that the required
changes in the Registration Statement and the Final Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if
any, to the Company and any nondefaulting Underwriter for damages
occasioned by its default hereunder.
10. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations and warranties of the Company and the
several Underwriters, set forth in or made pursuant to this Agreement, will
remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter, the Company or any of its officers or directors or
any controlling person, and will survive delivery of and payment for the
Securities. The provisions of Sections 7 and 8 hereof shall survive the
termination or cancellation of this Agreement.
11. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Representatives, will be mailed,
delivered or sent by facsimile transmission and confirmed to them, at the
address specified in Schedule I hereto; or, if sent to the Company, will be
mailed, delivered or sent by facsimile transmission and confirmed to the
Company at One McDonald's Plaza, Oak Brook, Illinois 60521, Attention of the
Treasurer, with a copy to the Controller.
12. Successors; Governing Law. This Agreement will inure to the benefit of
and be binding upon the parties hereto and the officers and directors and
controlling persons referred to in Section 8 hereof and their respective
successors, assigns, heirs, executors and administrators, and no other persons
will have any right or obligation hereunder. The terms ``successors'' and
``assigns'' as used herein shall not include a purchaser as such from any
Underwriter. This Agreement shall be governed by and construed and enforced in
accordance with, the internal laws of the State of Illinois.
13. Business Day. For purposes of this Agreement, ``business day'' means
any day on which the New York Stock Exchange is open for trading.
If the foregoing is in accordance with your understanding of our agreement,
sign and return to us the enclosed duplicate hereof, whereupon it will become
a binding agreement between the Company and the several Underwriters in
accordance with its terms.
Very truly yours,
McDONALD'S CORPORATION
By:/s/ Carleton Day Pearl
----------------------
The foregoing Underwriting Agreement is hereby confirmed and accepted by us in
Chicago, Illinois, acting on behalf of ourselves, the other Representatives
(if any), and the several Underwriters (if any) named in Schedule II annexed
hereto, as of the date first above written.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By:/s/ Brad Jones
-------------------
Date: January 9, 1997<PAGE>
<PAGE>
SCHEDULE I
Underwriting Agreement dated January 9, 1997
Registration Statement No. 333-14141
Representatives: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Title, Purchase Price and Description of Securities:
Title: 7 1/2% Subordinated Deferrable Interest
Debentures due 2037
Aggregate Principal Amount: $150,000,000
Price to Public: 100%
Purchase Price by Underwriter
(include accrued interest or
amortization if applicable): Retail: 96.85% Institutional: 98.00%
Maturity: January 2, 2037
Interest Rate: 7 1/2%
Interest Payment Dates: March 31, June 30, September 30
and December 31 and at Maturity
Regular Record Dates: March 15, June 15, September 15
and December 15, except as otherwise
described in the Prospectus Supplement
Redemption Provisions: At any time on or after December 31, 2001,
or upon the occurrence of a Tax Event as
described in the Prospectus Supplement, in
each case at 100% of the principal amount
together with accrued interest
Sinking Fund Provisions: None
Other Provisions: Interest may be deferrable at the option of
the Company under circumstances described
in the Prospectus Supplement for up to 20
consecutive quarterly interest payment
periods
Sale and Delivery Provisions under Section 3:
Obligation to Purchase is: several and not joint / /
several and not joint; provided, however
that, notwithstanding the provisions of
Section 9 of the Underwriting Agreement,
the Representative(s) listed above will,
subject to the terms and conditions hereof,
purchase or cause to be purchased any
Securities which any defaulting Underwriter
or Underwriters have agreed but failed or
refused to purchase pursuant to Section 3
hereof /X/
joint and several / /
Payment to Be Made in: New York Clearinghouse (next day) funds / /
or Federal (same day) funds /X/
Delivery of Securities: Physical delivery to Underwriters through
Representatives / /
or delivery to Underwriters through
facilities of DTC by delivery
to DTC of one or more definitive global
securities in book-entry form / /
Closing Date, Time and Location: January 14, 1997, 9:00 a.m.,
Gardner, Carton & Douglas,
321 N. Clark Street, Chicago, IL 60610
Address for Notice to Representatives:
c/o Merrill Lynch, Pierce,
Fenner & Smith Incorporated
World Financial Center
250 Vesey Street<PAGE>
New York, New York 10281
Attn: Capital Markets
<PAGE>
SCHEDULE II
Underwriters Principal Amount
------------ ----------------
Merrill Lynch, Pierce, Fenner & Smith Incorporated $ 16,125,000
Goldman, Sachs & Co. 16,125,000
J.P. Morgan Securities Inc. 16,125,000
Morgan Stanley & Co. Incorporated 16,125,000
PaineWebber Incorporated 16,125,000
Prudential Securities Incorporated 16,125,000
Salomon Brothers Inc 16,125,000
Smith Barney Inc. 16,125,000
Bear, Stearns & Co. Inc. 1,500,000
Alex. Brown & Sons Incorporated 1,500,000
Cowen & Company 1,500,000
Dain Bosworth Incorporated 1,500,000
Dillon, Read & Co. Inc. 1,500,000
Donaldson, Lufkin & Jenrette Securities Corporation 1,500,000
A.G. Edwards & Sons, Inc. 1,500,000
EVEREN Securities, Inc. 1,500,000
The Ohio Company 1,500,000
Oppenheimer & Co., Inc. 1,500,000
Piper Jaffray Inc. 1,500,000
Raymond James & Associates, Inc. 1,500,000
Tucker Anthony Incorporated 1,500,000
Wheat, First Securities, Inc. 1,500,000
-------------
Total $150,000,000
------------
------------
<PAGE>
SCHEDULE III
Delayed Delivery Contract
, 19
[Insert name and address
of lead Representative]
Dear Sirs:
The undersigned hereby agrees to purchase from McDonald's Corporation (the
``Company''), and the Company agrees to sell to the undersigned, on ,
19 , (the ``Delivery Date''),
$
principal amount of the Company's
(the ``Securities'') offered by the Company's Final Prospectus dated
, 19 , receipt of a copy of which is hereby acknowledged, at a
purchase price of % of the principal amount thereof, plus accrued
interest, if any, thereon from , 19 , to the date of payment and
delivery, and on the further terms and conditions set forth in this contract.
Payment for the Securities to be purchased by the undersigned shall be made
on or before 11:00 AM on the Delivery Date to or upon the order of the Company
in New York Clearinghouse (next day) funds or Federal (same day) funds, as
specified in Schedule I to the Underwriting Agreement referred to in the Final
Prospectus mentioned above, at your office or at such other places as shall be
agreed between the Company and the undersigned upon delivery to the
undersigned of the Securities in definitive fully registered form and in such
authorized denominations and registered in such names as the undersigned may
request by written communication addressed to the Company not less than five
full business days prior to the Delivery Date. If no request is received, the
Securities will be registered in the name of the undersigned and issued in a
denomination equal to the aggregate principal amount of Securities to be
purchased by the undersigned on the Delivery Date.
The obligation of the undersigned to take delivery of and make payment for
Securities on the Delivery Date, and the obligation of the Company to sell and
deliver Securities on the Delivery Date, shall be subject to the conditions
(and neither party shall incur any liability by reason of the failure thereof)
and (1) the purchase of Securities to be made by the undersigned, which
purchase the undersigned represents is not prohibited on the date hereof,
shall not on the Delivery Date be prohibited under the laws of the
jurisdiction to which the undersigned is subject, and (2) the Company, on or
before the Delivery Date, shall have sold to certain underwriters (the
``Underwriters'') such principal amount of the Securities as is to be sold to
them pursuant to the Underwriting Agreement referred to in the Final
Prospectus mentioned above. Promptly after completion of such sale to the
Underwriters, the Company will mail or deliver to the undersigned at its
address set forth below notice to such effect, accompanied by a copy of the
opinion of counsel for the Company delivered to the Underwriters in connection
therewith. The obligation of the undersigned to take delivery of and make
payment for the Securities, and the obligation of the Company to cause the
Securities to be sold and delivered, shall not be affected by the failure of
any purchaser to take delivery of and make payment for the Securities pursuant
to other contracts similar to this contract.
This contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that acceptance of this contract and other similar
contracts is in the Company's sole discretion and, without limiting the<PAGE>
foregoing, need not be on a first come, first served basis. If this contract
is acceptable to the Company, it is required that the Company sign the form of
acceptance below and mail or deliver one of the counterparts hereof to the
undersigned at its address set forth below. This will become a binding
contract between the Company and the undersigned, as of the date first above
written, when such counterpart is so mailed or delivered.
This agreement shall be governed by and construed and enforced in
accordance with, the internal laws of the State of Illinois.
Very truly yours,
--------------------------
(Name of Purchaser)
By
-----------------------
(Signature and Title of
Officer)
--------------------------
Accepted:
McDONALD'S CORPORATION
By
----------------------
(Authorized Signature)
EXHIBIT 3(i)
CORRECTED
RESTATED CERTIFICATE OF INCORPORATION
OF
McDONALD'S CORPORATION
(originally incorporated on December 21, 1964
under the name ``Regrub, Inc.'')
FIRST: The name of the corporation is McDONALD'S CORPORATION.
SECOND: Its registered office in the State of Delaware is located
at 1013 Centre Road, Wilmington, New Castle County, Delaware 19805.
The name and address of its registered agent is The Prentice-Hall
Corporation System, Inc., 1013 Centre Road, Wilmington, New Castle County,
Delaware 19805.
THIRD: The nature of the business of the Corporation and the
objects and purposes to be transacted, promoted or carried on are as follows:
1. To obtain by license or otherwise and to grant to others by
license or otherwise the right to the use of drive-in food establishment
systems and food service systems of every kind and character, and to manage
and operate drive-in and other restaurants and eating places of all kinds.
2. To manufacture, construct, lease, purchase and otherwise
acquire; to hold, own, repair, maintain, operate and invest, trade and deal
in; to lien, mortgage, pledge and otherwise encumber, and to let, assign,
transfer, sell and otherwise dispose of goods, wares and merchandise and
personal property of every kind and description and wherever situated.
3. To the same extent as natural persons might or could do, to
purchase or otherwise acquire, hold, own, maintain, work, develop, sell,
lease, sublease, exchange, hire, convey, mortgage or otherwise dispose of and
turn to account and deal in, lands, leaseholds, any interests, estates and
rights in real property, any personal or mixed property, and franchises,
rights, licenses, permits or privileges of every character.
4. To acquire by purchase, exchange or otherwise, all, or any part
of, or any interest in, the properties, assets, business and good will of any
one or more persons, firms, associations, corporations or syndicates engaged
in any business which the Corporation is authorized to engage in; to pay for
the same in cash, property or its own or other securities; to hold, operate,
reorganize, liquidate, sell or in any manner dispose of the whole or any part
thereof; and in connection therewith, to assume or guarantee performance of
any liabilities, obligations or contracts of such persons, firms,
associations, corporations or syndicates, and to conduct in any lawful manner
the whole or any part of any business thus acquired.
5. To acquire by purchase, subscription, contract or otherwise,
and to hold for investment or otherwise, sell, exchange, mortgage, pledge or
otherwise dispose of, or turn to account or realize upon, and generally to
deal in and with, any and all kinds of securities issued or created by, or
interests in, corporations, associations, partnerships, firms, trustees,
syndicates, individuals, municipalities or other political or governmental
divisions or subdivisions, or any thereof, or by any combinations,
organizations or entities whatsoever, irrespective of their form or the name
by which they may be described; and to exercise any and all rights, powers,
and privileges of individual ownership or interest in respect of any and all
such securities and interests, including the right to vote thereon and to<PAGE>
consent and otherwise act with respect thereto; to do any and all acts and
things for the preservation, protection, improvement and enhancement in value
of any and all such securities or interests, and to aid by loan, subsidy,
guaranty or in any other manner permitted by law those issuing, creating, or
responsible for any such securities or interests.
6. To develop, apply for, obtain, register, purchase, lease, take
licenses in respect of or otherwise acquire, and to hold, own, use, operate,
enjoy, turn to account, grant licenses in respect of, manufacture under,
introduce, sell, assign, mortgage, pledge or otherwise dispose of any and all
inventions, devices, formulae, processes, improvements and modifications
thereof, letters patent and all rights connected therewith or appertaining
thereunto, copyrights, trademarks, trade names, trade symbols and other
indications of origin and ownership, franchises, licenses, grants and
concessions granted by or recognized under the laws of the United States of
America or of any state or subdivision thereof or of any other country or
subdivision thereof.
7. To loan money upon the security of real and/or personal
property of whatsoever name, nature or description, or without security.
8. To borrow money for any of the purposes of the Corporation,
from time to time, and without limit as to amount; to issue and sell its own
securities in such amounts, on such terms and conditions, for such purposes
and for such prices, as the Board of Directors shall determine; and to secure
such securities, by mortgage upon, or the pledge of, or the conveyance or
assignment in trust of, the whole or any part of the properties, assets,
business and good will of the Corporation, then owned or thereafter acquired.
It is the intention that the objects and purposes set forth in the
foregoing clauses of this Article Third shall not, unless otherwise specified
herein, be in any wise limited or restricted by reference to, or inference
from, the terms of any other clause of this or any other article in this
Certificate, but that the objects and purposes specified in each of said
clauses shall be regarded as independent objects and purposes.
It is also the intention that the foregoing clauses shall be
construed as powers as well as objects and purposes; that the Corporation
shall be authorized to conduct its business or hold property in any part of
the United States and its possessions, and foreign countries; that the
foregoing enumeration of specific powers shall not be held to limit or
restrict in any manner the general powers of the Corporation; and that
generally the Corporation shall be authorized to exercise and enjoy all other
powers conferred on corporations by the laws of Delaware.
FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is Three Billion Six Hundred Sixty-Five Million
(3,665,000,000), consisting of Three Billion Five Hundred Million
(3,500,000,000) shares of Common Stock with one cent ($.01) par value and One
Hundred Sixty-Five Million (165,000,000) shares of Preferred Stock without par
value.
A. COMMON STOCK
Each share of Common Stock shall be equal to every other share of
Common Stock in every respect. Subject to any exclusive voting rights which
may vest in holders of Preferred Stock under the provisions of any series of
the Preferred Stock established by the Board of Directors pursuant to
authority herein provided, the shares of Common Stock shall entitle the
holders thereof to one vote for each share upon all matters upon which
stockholders have the right to vote.
B. PREFERRED STOCK
(1) Preferred Stock may be issued from time to time in one or more
series, each of such series to have such designations, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations or restrictions thereof, as are stated and expressed in this
Article and in the resolution or resolutions providing for the issuance of
such series adopted by the Board of Directors as hereinafter provided.
(2) Authority is hereby expressly granted to the Board of Directors
subject to the provisions of this Article to authorize the issuance of one or
more series of Preferred Stock and, with respect to each series, to fix by
resolution or resolutions providing for the issuance of such series:
(a) The number of shares to constitute such series and the
distinctive designations thereof;
(b) The dividend rate or rates to which such shares shall be
entitled and the restrictions, limitations and conditions upon the payment of
such dividends, whether dividends shall be cumulative or non-cumulative and,
if cumulative, the date or dates from which dividends shall accumulate, the
dates on which dividends, if declared, shall be payable, and the preferences
or relations to the dividends payable on any other series of Preferred Stock;
(c) Whether or not all or any part of the shares of such
series shall be redeemable, and if so, the limitations and restrictions with
respect to such redemptions, the manner of selecting shares of such series for
redemption if less than all shares are to be redeemed, and the amount, if any,
in addition to any accrued dividends thereon, which the holder of shares of
such series shall be entitled to receive upon the redemption thereof, which
amount may vary at different redemption dates and may be different with
respect to shares redeemed through the operation of any retirement or sinking
fund and with respect to shares otherwise redeemed;
(d) The amount in addition to any accrued dividends thereon
which the holders of shares of such series shall be entitled to receive upon
the voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, which amount may vary depending on whether such liquidation,
dissolution or winding up is voluntary or involuntary and, if voluntary, may
vary at different dates;
(e) Whether or not the shares of such series shall be subject
to the operation of a purchase, retirement or sinking fund, and, if so,
whether such purchase, retirement or sinking fund shall be cumulative or non-
cumulative, the extent and the manner in which such fund shall be applied to
the purchase or redemption of the shares of such series for retirement or to
other corporate purposes and the terms and provisions relative to the
operation thereof;
(f) Whether or not the shares of such series shall be
convertible into, or exchangeable for, shares of stock of any other class or
classes, or of any other series of the same class, and if so convertible or
exchangeable, the price or prices or the rate or rates of conversion or
exchange and the method, if any, of adjusting the same;
(g) The voting powers, if any, of such series in addition to
the voting powers provided by law; except that such powers shall not include
the right to have more than one vote per share;
(h) Any other preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof as shall not be inconsistent with law or with this
Article.
Notwithstanding the fixing of the number of shares constituting a
particular series upon the issuance thereof, the Board of Directors may at any
time thereafter authorize the issuance of additional shares of the same
series, or decrease the number of shares constituting such series (but not
below the number of shares of such series then outstanding).
(3) All shares of any one series of Preferred Stock shall be
identical with all other shares of the same series except that shares of any
one series issued at different times may differ as to the dates from which
dividends thereon shall be cumulative; and all series shall rank equally and
be identical in all respects, except as permitted by the foregoing provisions
of paragraph B. (2).
(4) (a) The holders of Preferred Stock shall be entitled to
receive cash dividends when and as declared by the Board of Directors at such
rate per share per annum, cumulatively if so provided, and with such
preferences, as shall have been fixed by the Board of Directors, before any
dividends shall be paid upon or declared and set apart for the Common Stock or
any other class of stock ranking junior to the Preferred Stock, and such
dividends on each series of the Preferred Stock shall cumulate, if at all,
from and after the dates fixed by the Board of Directors with respect to such
cumulation. Accrued dividends shall bear no interest.
(b) If dividends on the Preferred Stock are not declared in
full then dividends shall be declared ratably on all shares of stock of each
series of equal preference in proportion to the respective unpaid cumulative
dividends, if any, to the end of the then current dividend period. No ratable
distribution shall be declared or set apart for payment with respect to any
series until accumulated dividends in arrears in full have been declared and
paid on any series senior in preference.
(c) Unless dividends on all outstanding shares of series of
the Preferred Stock having cumulative dividend rights shall have been fully
paid for all past dividend periods, and unless all required sinking fund
payments, if any, shall have been made or provided for, no dividend (except a
dividend payable in Common Stock or in any other class of stock ranking junior
to the Preferred Stock) shall be paid upon or declared and set apart for the
Common Stock or any other class of stock ranking junior to the Preferred
Stock.
(d) Subject to the foregoing provisions, the Board of
Directors may declare and pay dividends on the Common Stock and on any class
of stock ranking junior to the Preferred Stock, to the extent permitted by
law. After full dividends for the current dividend period, and, in the case
of Preferred Stock having cumulative dividend rights after all prior dividends
have been paid or declared and set apart for payment, the holders of the
Common Stock shall be entitled, to the exclusion of the holders of the
Preferred Stock, to all further dividends declared and paid in such current
dividend period.
(5) In the event of any liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary, before any payment or
distribution of the assets of the Corporation shall be made to or set apart
for the holders of shares of any class or classes of stock of the Corporation
ranking junior to the Preferred Stock, the holders of the shares of each
series of the Preferred Stock shall be entitled to receive payment of the
amount per share fixed in the resolution or resolutions adopted by the Board
of Directors providing for the issuance of the shares of such series, plus an
amount equal to all dividends accrued thereon to the date of final
distribution to such holders; but they shall be entitled to no further
payment. If, upon any liquidation, dissolution or winding up of the
Corporation, the assets of the Corporation, or proceeds thereof, distributable
among the holders of the shares of the Preferred Stock shall be insufficient
to pay in full the preferential amount aforesaid, then such assets, or the
proceeds thereof, shall be distributed among such holders ratably in
accordance with the respective amount which would be payable on such shares if
all amounts payable thereon were paid in full. For the purposes of this
paragraph B. (5), the sale, conveyance, exchange or transfer (for cash, shares
of stock, securities or other consideration) of all or substantially all of
the property or assets of the Corporation or a consolidation or merger of the
Corporation with one or more corporations shall not be deemed to be a
dissolution, liquidation or winding up, voluntary or involuntary.
(6) Shares of any series of Preferred Stock which have been issued
and reacquired in any manner by the Company (excluding shares purchased and
retired, whether through the operation of a retirement or sinking fund or
otherwise, and shares 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 Preferred Stock 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 Preferred Stock
or as part of any other series of Preferred Stock, all subject to the
conditions or restrictions on issuance fixed by the Board of Directors with
respect to the shares of any other series of Preferred Stock.
(7) Except as otherwise specifically provided herein or in the
authorizing resolutions, none of the shares of any series of Preferred Stock
shall be entitled to any voting rights and the Common Stock shall have the
exclusive right to vote for the election of directors and for all other
purposes. So long as any shares of any series of Preferred Stock are
outstanding, the Corporation shall not, without the consent of the holders of
a majority of the then outstanding shares of Preferred Stock, irrespective of
series, either expressed in writing (to the extent permitted by law) or by
their affirmative vote at a meeting called for that purpose: (i) adopt any
amendment to this Restated Certificate of Incorporation or take any other
action which in any material respect adversely affects any preference, power,
special right, or other term of the Preferred Stock or the holders thereof,
(ii) create or issue any class of stock entitled to any preference over the
Preferred Stock as to the payment of dividends, or the distribution of capital
assets, (iii) increase the aggregate number of shares constituting the
authorized Preferred Stock or (iv) create or issue any other class of stock
entitled to any preference on a parity with the Preferred Stock as to the
payment of dividends or the distribution of capital assets.
(8) If in any case the amounts payable with respect to any
obligations to retire shares of the Preferred Stock are not paid in full in
the case of all series with respect to which such obligations exist, the
number of shares of each of such series to be retired pursuant to any such
obligations shall be in proportion to the respective amounts which would be
payable on account of such obligations if all amounts payable in respect of
such series were discharged in full.
(9) The shares of Preferred Stock may be issued by the Corporation
from time to time for such consideration as may be fixed from time to time by
the Board of Directors. Any and all shares for which the consideration so
fixed shall have been paid or delivered shall be deemed fully paid and
nonassessable.
(10) For the purpose of the provisions of this Article dealing with
Preferred Stock or of any resolution of the Board of Directors providing for
the issuance of any series of Preferred Stock or of any certificate filed with
the Secretary of State of the State of Delaware pursuant to any such
resolution (unless otherwise provided in any such resolution or certificate):
(a) The term "outstanding", when used in reference to shares
of stock, shall mean issued shares, excluding shares held by the Corporation
and shares called for redemption, funds for the redemption of which shall have
been set aside or deposited in trust;
(b) The amount of dividends "accrued" on any share of
Preferred Stock as at any dividend date shall be deemed to be the amount of
any unpaid dividends accumulated thereon to and including such dividend date,
whether or not earned or declared, and the amount of dividends "accrued" on
any share of Preferred Stock as at any date other than a dividend date shall
be calculated as the amount of any unpaid dividends accumulated thereon to and
including the last preceding dividend date, whether or not earned or declared,
plus an amount equivalent to interest on the involuntary liquidation value of
such share at the annual dividend rate fixed for the shares of such series for
the period after such last preceding dividend date to and including the date
as of which the calculation is made;
(c) The term ``class or classes of stock of the corporation
ranking junior to the Preferred Stock'' shall mean the Common Stock of the
Corporation and any other class or classes of stock of the Corporation
hereafter authorized which shall rank junior to the Preferred Stock as to
dividends or upon liquidation.
C. PROVISIONS APPLICABLE TO ALL CAPITAL STOCK
No holder of any share or shares of any class of stock of the
Corporation shall have any preemptive or preferential right to subscribe for
or purchase any shares of stock of any class of the Corporation now or
hereafter authorized or any securities convertible into or carrying any rights
to purchase any shares of stock of any class of the Corporation now or
hereafter authorized, other than such rights, if any, as the Board of
Directors in its discretion from time to time may grant, and at such prices
and upon such other terms and conditions as the Board of Directors in its
discretion may fix.
D. SERIES OF PREFERRED STOCK
Following are the statements of the designations, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations and restrictions thereof, of the series of Preferred Stock that
have been designated by the Board of Directors as authorized herein:
1. Series A Junior Participating Preferred Stock.
RESOLVED, that pursuant to the authority granted to and vested in
the Board of Directors of this Corporation (hereinafter called the ``Board of
Directors'' or the "Board") in accordance with the provisions of the
Restated Certificate of Incorporation, the Board of Directors hereby creates a
series of Preferred Stock, without par value (the ` Preferred Stock''), of the
Corporation and hereby states the designation and number of shares, and fixes
the relative rights, preferences, and limitations thereof as follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The shares of such series shall
be designated as "Series A Junior Participating Preferred Stock" (the "Series
A Preferred Stock") and the number of shares constituting the Series
A Preferred Stock shall be 2,050,000. Such number of shares may be increased
or decreased by resolution of the Board of Directors; provided, that no
decrease shall reduce the number of shares of Series A Preferred Stock to a
number less than the number of shares then outstanding plus the number of
shares reserved for issuance upon the exercise of outstanding options, rights
or warrants or upon the conversion of any outstanding securities issued by the
Corporation convertible into Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and superior to
the Series A Preferred Stock with respect to dividends, the holders of shares
of Series A Preferred Stock, in preference to the holders of Common Stock,
without par value (the "Common Stock"), of the Corporation, and of any other
junior stock, shall be entitled to receive, when, as and if declared by the
Board of Directors out of funds legally available for the purpose, quarterly
dividends payable in cash on the first day of March, June, September and
December in each year (each such date being referred to herein as a
Quarterly Dividend Payment Date "Quarterly Dividend Payment Date"), commencing
on the first Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Series A Preferred Stock, in an amount per
share (rounded to the nearest cent) equal to the greater of (a) $1 or (b)
subject to the provision for adjustment hereinafter set forth, 100 times the
aggregate per share amount of all cash dividends, and 100 times the aggregate
per share amount (payable in kind) of all non-cash dividends or other
distributions, other than a dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock (by reclassification or
otherwise), declared on the Common Stock since the immediately preceding
Quarterly Dividend Payment Date or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series A Preferred Stock. In the event the Corporation shall at any
time declare or pay any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise
than by payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the
Series A Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock); provided that, in
the event no dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date and the
next subsequent Quarterly Dividend Payment Date, a dividend of $1 per share on
the Series A Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares, unless the date
of issue of such shares is prior to the record date for the first Quarterly
Dividend Payment Date, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment Date,
in either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series A
Preferred Stock in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The Board
of Directors may fix a record date for the determination of holders of shares
of Series A Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not more than 60
days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof to one
vote on all matters submitted to a vote of the stockholders of the
Corporation. In the event the Corporation shall at any time declare or pay
any dividend on the Common Stock payable in shares of Common Stock, or effect
a subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a dividend
in shares of Common Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the number of votes per share to which holders
of Series A Preferred Stock were entitled immediately prior to such event
shall be adjusted by multiplying such number by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event, provided that in
no event shall a share of Series A Preferred Stock be entitled to more than
one vote.
(B) Except as otherwise provided herein, in any other Certificate
of Designations creating a series of Preferred Stock or any similar stock, or
by law, the holders of shares of Series A Preferred Stock and the holders of
shares of Common Stock and any other capital stock of the Corporation having
general voting rights shall vote together as one class on all matters
submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock shall have no special voting rights and
their consent shall not be required (except to the extent they are entitled to
vote with holders of Common Stock as set forth herein) for taking any
corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in Section 2
are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions, on
any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on
any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred Stock,
except dividends paid ratably on the Series A Preferred Stock and all such
parity stock on which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Stock,
provided that the Corporation may at any time redeem, purchase or otherwise
acquire shares of any such junior stock in exchange for shares of any stock of
the Corporation ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a parity
with the Series A Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board of Directors) to
all holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative
rights and preferences of the respective series and classes, shall determine
in good faith will result in fair and equitable treatment among the respective
series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (A) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part of a new series
of Preferred Stock subject to the conditions and restrictions on issuance set
forth herein, in the Restated Certificate of Incorporation, or in any other
Certificate of Designations creating a series of Preferred Stock or any
similar stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no distribution
shall be made (1) to the holders of shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, provided that the holders of shares of
Series A Preferred Stock shall be entitled to receive an aggregate amount per
share, subject to the provision for adjustment hereinafter set forth, equal to
100 times the aggregate amount to be distributed per share to holders of
shares of Common Stock, or (2) to the holders of shares of stock ranking on a
parity (either as to dividends or upon liquidation, dissolution or winding up)
with the Series A Preferred Stock, except distributions made ratably on the
Series A Preferred Stock and all such parity stock in proportion to the total
amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the Corporation shall at
any time declare or pay any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount by a fraction
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other transaction
in which the shares of Common stock are exchanged for or changed into other
stock or securities, cash and/or any other property, then in any such case
each share of Series A Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a dividend
in shares of Common Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the amount set forth in the preceding sentence
with respect to the exchange or change of shares of Series A Preferred Stock
shall be adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock
shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of assets, junior to
all series of any other class of the Corporation's Preferred Stock.
Section 10. Amendment. The Restated Certificate of Incorporation
of the Corporation shall not be amended in any manner which would materially
alter or change the powers, preferences or special rights of the Series A
Preferred Stock so as to affect them adversely without the affirmative vote of
the holders of at least two-thirds of the outstanding shares of Series A
Preferred Stock, voting together as a single class.
2. Series D Preferred Stock.
FURTHER RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation (hereinafter called the
``Board of Directors'' or the "Board") in accordance with the provisions of
the Restated Certificate of Incorporation, the Board of Directors hereby
creates a series of Preferred Stock, without par value (the "Preferred
Stock"), of the Corporation and hereby states the designation and number of
shares, and fixes the relative rights, preferences and limitations thereof as
follows:
Series D Preferred Stock:
Section 1. Designation and Amount. The shares of such series shall
be designated as Series D Preferred Stock (the ``Series D Preferred Stock")
and the number of shares constituting the Series D Preferred Stock shall be
three hundred thousand (300,000). Shares of Series D Preferred Stock shall
have a stated value of $100 per share. Such number may be increased or
decreased by resolution of the Board of Directors; provided, however that no
decrease shall reduce the number of shares of Series D Preferred Stock to a
number less than the number of shares then outstanding plus the number of
shares reserved for issuance upon the exercise of outstanding options, rights
or warrants issued by or upon the conversion of any outstanding securities
issued by the Corporation convertible into Series D Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and superior to
the Series D Preferred Stock with respect to dividends, the holders of shares
of Series D Preferred Stock, in preference to the holders of Common Stock and
of any other Junior Stock (as hereinafter defined in Section 4(B)), shall be
entitled to receive a cash dividend payable in an amount per share equal to
$1.25 per quarter and no more (such amount being referred to herein as the
"Dividend Amount"), which dividend shall be payable when and as declared by
the Board of Directors, out of funds legally available for the purpose,
payable quarterly in arrears on the first day of March, June, September and
December in each year (each such date being referred to herein as "Dividend
Payment Date"), subject to Section 2(B) below, commencing on the first
Dividend Payment Date after the first issuance of a share of Series D
Preferred Stock. In the event that any Dividend Payment Date shall occur on
any day other than a "Business Day" (as hereinafter defined), the dividend
payment due on such Dividend Payment Date shall be paid on the Business Day
immediately preceding such Dividend Payment Date. The Board of Directors may
fix a record date for the determination of holders of shares of Series D
Preferred Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than 60 days prior to
the date fixed for the payment thereof. For purposes of these resolutions,
``Business Day'' shall mean each day that is not a Saturday, Sunday or a date
on which federally or state chartered banking institutions in Chicago,
Illinois or New York, New York are required or authorized to be closed.
(B) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series D Preferred Stock from the date of issue of such
shares and shall accrue on a daily basis whether or not declared and whether
or not the Corporation shall have earnings or surplus out of which such
dividends could be paid at the time. Dividends accrued on the shares of Series
D Preferred Stock for any period less than a full quarterly period between
Dividend Payment Dates shall be computed on the basis of a 360-day year of 30-
day months and in lieu of the initial quarterly dividend, such a proportional
dividend shall accrue for the period from the date of issue until the first
Dividend Payment Date after the issuance of any such shares. Accrued but
unpaid dividends shall not bear interest. Accumulated but unpaid dividends
shall cumulate as of the Dividend Payment Date on which they first become
payable, but no interest shall accrue on accumulated but unpaid dividends.
(C) Dividends paid on the shares of Series D Preferred Stock in an
amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding.
Section 3. Voting Rights. The holders of shares of Series D
Preferred Stock shall have the following voting rights:
(A) Each share of Series D Preferred Stock shall entitle the holder
thereof to one vote on all matters submitted to a vote of the stockholders of
the Corporation.
(B) Except as otherwise provided by law or in the Restated
Certificate of Incorporation, the holders of shares of Series D Preferred
Stock and the holders of shares of Common Stock and any other capital stock of
the Corporation having general voting rights shall vote together as one class
on all matters submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law or
in the Restated Certificate of Incorporation, holders of Series D Preferred
Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of
Common stock as set forth herein) for taking any corporate action. Any
increase or decrease in the authorized class of Preferred Stock shall not be
deemed to alter or change the powers, preferences, or special rights of the
shares of Series D Preferred Stock so as to affect them adversely within the
meaning of the General Corporation Law of the State of Delaware and no class
vote shall be required to authorize such increase or decrease.
Section 4. Certain Restrictions.
(A) So long as any Series D Preferred Stock shall be outstanding,
no dividend shall be declared and paid or set apart for payment on any other
series of stock ranking on a parity with the Series D Preferred Stock as to
dividends ("Parity Stock"), unless there shall also be or have been declared
and paid or set apart for payment on the Series D Preferred Stock dividends
for all dividend payment periods of the Series D Preferred Stock ending on or
before the dividend payment date of such Parity Stock, ratably in proportion
to the respective amounts of dividends on the Series D Preferred Stock
accumulated and unpaid through the most recent such dividend payment period,
and accumulated and unpaid on such Parity Stock through the dividend payment
period on such Parity Stock ending on such dividend payment date or such
dividend payment date immediately preceding such dividend payment period.
(B) So long as any Series D Preferred Stock shall be outstanding,
in the event that full cumulative dividends on the Series D Preferred Stock
have not been declared and paid or set apart for payment, the Corporation
shall not declare and pay or set apart for payment any dividends or make any
other distributions on, or make any payment on account of the purchase,
redemption or other retirement of, Common Stock or any other class of stock or
series thereof of the Corporation ranking, as to dividends or as to
distributions in the event of a liquidation, dissolution or winding up of the
Corporation, junior to the Series D Preferred Stock (collectively, "Junior
Stock") until full cumulative and unpaid dividends on the Series D Preferred
Stock shall have been paid or declared and set apart for payment; provided,
however, that the foregoing shall not apply to (i) any dividend payable solely
in any shares of Junior Stock, or (ii) the acquisition of shares of Junior
Stock either (x) pursuant to any employee or director incentive or benefit
plan or arrangement of the Corporation or any subsidiary of the Corporation
heretofore or hereafter adopted or (y) in exchange solely for shares of any
other Junior Stock. Subject to the foregoing provisions of this Section 4,
the Board of Directors may declare and the Corporation may pay or set apart
for payment dividends and other distributions on any Junior Stock or Parity
Stock; and may purchase or otherwise redeem or retire any of the Junior Stock
or Parity Stock or any warrants, rights, or options or other securities
exercisable for or convertible into any of the Junior Stock or Parity Stock
and the holders of shares of the Series D Preferred Stock shall not be
entitled to share therein.
Section 5. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (i) to the holders of shares of
Junior Stock unless, prior thereto, the holders of shares of Series D
Preferred Stock shall have received $100 per share (such amount being referred
to herein as the "Liquidation Preference"), plus an amount equal to accrued
and unpaid dividends and distributions thereon, whether or not declared, as to
the date of such payment, or (ii) to the holders of shares of Parity Stock,
except distributions made ratably on the Series D Preferred Stock and all such
Parity Stock in proportion to the total amounts to which the holders of all
such shares are entitled upon such liquidation, dissolution or winding up.
After payment of the full amount to which they are entitled as provided by the
foregoing provisions of this Section 5(A), the holders of shares of Series D
Preferred Stock shall not be entitled to any further right or claim to any of
the remaining assets of the Corporation.
(B) Neither the merger or consolidation of the Corporation with or
into any other corporation or other entity, nor the merger or consolidation of
any other corporation or other entity with or into the Corporation, nor the
sale, transfer or lease of all or any portion of the assets of the
Corporation, shall be deemed to be a liquidation, dissolution or winding up of
the Corporation for purposes of this Section 5.
(C) Written notice of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, stating the payment date or
dates when, and the place or places where, the amounts distributable to
holders of Series D Preferred Stock in such circumstances shall be payable,
shall be made in accordance with Section 8 below not less than 20 days prior
to any payment date stated therein, to the holders of Series D Preferred
Stock, at their respective addresses shown on the books of the Corporation or
any transfer agent for the Series D Preferred Stock; provided, however, that a
failure to give notice as provided herein or any defect therein shall not
affect the Corporation's ability to consummate a voluntary or involuntary
liquidation, dissolution or winding up of the Corporation.
Section 6. Redemption.
All of the outstanding Series D Preferred Stock shall be redeemed,
by the Corporation, out of funds legally available therefor, on the later of
(i) February 1, 1997 and (ii) the death of Maurice J. Sullivan, an individual
residing in the State of Hawaii, to whom the initial shares of Series D
Preferred Stock will initially be issued (the "Redemption Date"). The
shares shall be redeemed at a price of $100 per share, plus an amount equal to
accrued and unpaid dividends thereon, to the Redemption Date (the "Redemption
Price"). On or subsequent to the Redemption Date, upon surrender of the
certificates for any shares to be redeemed pursuant to the provisions of this
Section 6, the Redemption Price of such shares shall be paid in cash. In the
event that the Redemption Price is either paid or made available for payment,
then, notwithstanding that the certificate or certificates evidencing any of
the shares of the Series D Preferred Stock shall not have been surrendered,
all rights with respect to such shares shall terminate, effective on the
Redemption Date, and any such certificate shall represent only the right to
receive the Redemption Price, without interest, upon surrender. No interest
shall accrue on the Redemption Price after the Redemption Date.
Section 7. Reacquired Shares. Any shares of Series D Preferred
Stock acquired by the Corporation by reason of the redemption of such shares
as provided hereby, or otherwise so acquired, shall be retired and the
Corporation shall take all actions necessary to restore such shares to the
status of authorized but unissued shares of Preferred Stock, without par
value, of the Corporation, which shares may thereafter be reissued as part of
a new series of such Preferred Stock or as Series D Preferred Stock, as
permitted by law.
Section 8. Miscellaneous.
(A) All notices referred to herein shall be in writing, and
delivered personally, sent by courier, or by registered or certified mail
(postage prepaid, return receipt requested) addressed: (i) if to the
Corporation, to its office at McDonald's Plaza, Oak Brook, Illinois 60521
(Attention: Secretary) or to the transfer agent designated by the Corporation
or (ii) if to any holder of the Series D Preferred Stock, to such holder at
the address of such holder as listed in the stock records books of the
Corporation (which may include the records of any transfer agent for the
Series D Preferred Stock or Common Stock, as the case may be) or (iii) to such
other address as the Corporation or any such holder, as the case may be, shall
have designated by notice similarly given.
(B) The Corporation shall pay any and all stock transfer and
documentary stamp taxes that may be payable in respect of any issuance or
delivery or shares of Series D Preferred Stock or certificates representing
such shares. The Corporation shall not, however, be required to pay any such
tax which may be payable in respect of any transfer involved in the issuance
or delivery of shares of Series D Preferred Stock in a name other than the
name in which the shares of Series D Preferred Stock with respect to which
such shares are issued or delivered were registered, or in respect of any
payment to any person with respect to any such shares other than a payment to
the registered holder thereof, and shall not be required to make any such
issuance, delivery or payment unless and until the person otherwise entitled
to such issuance, delivery or payment has paid to the Corporation the amount
of any such tax or has established, to the satisfaction of the Corporation,
that such tax has been paid or is not payable.
(C) Unless otherwise provided in the Certificate of Designations as
the same may be amended, all payments in the form of dividends, distributions
on voluntary or involuntary dissolution, liquidation or winding-up otherwise
made upon the shares of Series D Preferred Stock and any other stock ranking
on a parity with the Series D Preferred Stock with respect to such dividend or
distribution shall be made pro rata, so that amounts paid per share on the
Series D Preferred Stock and such other stock shall in all cases bear to each
other the same ratio that the required dividends, distributions or payments,
as the case may be, then payable per share on the shares of the Series D
Preferred Stock and such other stock bear to each other.
(D) The Corporation may appoint and from time to time discharge and
change, a transfer agent for the Series D Preferred Stock. Upon any such
appointment or discharge of a transfer agent, the Corporation shall send
notice thereof in accordance with Section 8(A) to each holder of record of
Series D Preferred Stock.
3. Series E Preferred Stock.
RESOLVED, That the issuance of a series of Preferred Stock, without
par value, of the Corporation is hereby authorized and the designations,
preferences and privileges, relative, participating, optional and other
special rights and qualifications, limitations and restrictions thereof, in
addition to those set forth in the Restated Certificate of Incorporation of
the Corporation, are hereby fixed as follows:
7.72% Cumulative Preferred Stock, Series E
Section 1. Designation and Amount. The shares of such series
shall be designated as 7.72% Cumulative Preferred Stock, Series E (the
"Series E Preferred Stock"), and the number of shares constituting the
Series E Preferred Stock shall be 7,407. Shares of Series E Preferred Stock
shall have a liquidation preference of $50,000 per share. The number of
shares may be increased or decreased by resolution of the Board of Directors;
provided, however, that no decrease shall reduce the number of shares of
Series E Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the exercise
of outstanding options, rights or warrants issued by or upon the conversion
of any outstanding securities issued by the Corporation convertible into
Series E Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and superior
to Series E Preferred Stock with respect to dividends, the holders of shares
of Series E Preferred Stock, in preference to the holders of Common Stock and
of any other Junior Stock (as hereinafter defined in Section 4(B)), shall be
entitled to receive a cash dividend payable in an amount per share equal to
$965.00 per quarter and no more (such amount being referred to herein as the
"Dividend Amount"), which dividend shall be payable when, as and if
declared by the Board of Directors, out of funds legally available for that
purpose, quarterly in arrears on the first day of March, June, September and
December in each year (each such date being referred to herein as a
"Dividend Payment Date"), commencing on March 1, 1993. In the event that
any Dividend Payment Date shall occur on any day other than a "Business
Day" (as hereinafter defined), the dividend payment due on such Dividend
Payment Date shall be paid on the Business Day immediately preceding such
Dividend Payment Date. The Board of Directors may fix a record date for the
determination of holders of shares of Series E Preferred Stock entitled to
receive payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the payment
thereof. For purposes of these resolutions, "Business Day" shall mean each
day that is not a Saturday, Sunday or a date on which federally or state
chartered banking institutions in Chicago, Illinois or New York, New York are
required or authorized to be closed.
(B) Dividends shall begin to accrue on outstanding shares of
Series E Preferred Stock from the date of original issuance of such shares
and shall accrue on a daily basis whether or not declared and whether or not
the Corporation shall have earnings or surplus out of which such dividends
could be paid at the time. Dividends accrued on the shares of Series E
Preferred Stock for any period greater or less than a full quarterly period
between Dividend Payment Dates shall be computed on the basis of a 360-day
year of twelve 30-day months. Accrued but unpaid dividends shall not bear
interest. Accrued but unpaid dividends shall cumulate as of the Dividend
Payment Date on which they first become payable, but no interest shall accrue
on such accumulated but unpaid dividends.
(C) Dividends paid on the shares of Series E Preferred Stock in an
amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding.
Section 3. Voting Rights.
(A) Except as set forth herein, or as otherwise provided by law or
in the Restated Certificate of Incorporation, holders of Series E Preferred
Stock shall have no special voting rights and their consent shall not be
required for taking any corporate action. On those matters where voting rights
are conferred herein, by law or in the Restated Certificate of Incorporation,
each share of Series E Preferred Stock shall entitle the voter thereof to one
vote. Any increase or decrease in the authorized class of Preferred Stock
shall not be deemed to alter or change the powers, preferences, or special
rights of the shares of Series E Preferred Stock so as to affect them
adversely within the meaning of the General Corporation Law of the State of
Delaware and no class vote shall be required to authorize such increase or
decrease.
(B) If at any time dividends payable on Series E Preferred Stock,
or on any one or more other series of Preferred Stock of the Corporation
entitled to receive cumulative preferred dividends, are in arrears and unpaid
in an amount equal to or exceeding the amount of dividends payable on such
Series E Preferred Stock and/or other series of Preferred Stock entitled to
receive cumulative dividends for six quarterly dividend periods, whether or
not consecutive, the holders of all outstanding shares of Preferred Stock
entitled to receive cumulative preferred dividends will have the exclusive
right, voting separately as a class, to elect two directors to the Board of
Directors of the Corporation at the next annual meeting of stockholders of
the Corporation. The authorized number of Directors shall not be increased
for this purpose. Such voting right will continue for such Preferred Stock
until all dividends on Series E Preferred Stock and on such other series have
been paid in full, at which time such voting right of the holders of such
Preferred Stock will terminate, subject to re-vesting in the event of a
subsequent arrearage. Upon any termination of the aforesaid voting right,
the term of office of those directors elected by holders of Preferred Stock
voting separately as a class will terminate.
Section 4. Certain Restrictions.
(A) So long as any Series E Preferred Stock shall be outstanding,
no dividend shall be declared and paid or set apart for payment on any other
series of stock ranking on a parity with Series E Preferred Stock as to
dividends ("Parity Stock"), unless there shall also be or have been
declared and paid or set apart for payment on Series E Preferred Stock
dividends for all dividend payment periods of Series E Preferred Stock ending
on or before the dividend payment date of such Parity Stock, ratably in
proportion to the respective amounts of dividends on the Series E Preferred
Stock accrued and unpaid through the most recent such dividend payment
period, and accrued and unpaid on such Parity Stock through the dividend
payment period on such Parity Stock ending on such dividend payment date or
such dividend payment date immediately preceding such dividend payment
period.
(B) So long as any Series E Preferred Stock shall be outstanding,
in the event that full cumulative dividends on the Series E Preferred Stock
have not been declared and paid or set apart for payment when due, the
Corporation shall not declare and pay or set apart for payment any dividends
on Common Stock or any other class of stock or series thereof of the
Corporation ranking as to dividends junior to Series E Preferred Stock
(collectively, "Junior Stock") until full cumulative and unpaid dividends
on Series E Preferred Stock shall have been paid or declared and set apart
for payment; provided, however, that the foregoing shall not apply to any
dividend payable solely in any shares of Junior Stock. Subject to the
foregoing provisions of this Section 4, the Board of Directors may declare
and the Corporation may pay or set apart for payment dividends on any Junior
Stock or Parity Stock and the holders of shares of Series E Preferred Stock
shall not be entitled to share therein.
Section 5. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, either voluntary or involuntary, no distribution shall be made
(i) to the holders of shares of stock ranking junior to the Series E
Preferred Stock as to distributions in the event of any liquidation,
dissolution or winding up of the Corporation unless, prior thereto, the
holders of shares of Series E Preferred Stock shall have received $50,000 per
share (such amount being referred to herein as the "Liquidation
Preference"), plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, as to the date of such
payment, or (ii) to the holders of shares of stock ranking on a parity with
the Series E Preferred Stock as to distributions in the event of any
liquidation, dissolution or winding up of the Corporation ("Parity
Liquidation Stock"), except distributions made ratably on Series E Preferred
Stock and all such Parity Liquidation Stock in proportion to the total
amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. After payment of the full amount to
which they are entitled as provided by the foregoing provisions of this
Section 5(A), the holders of shares of Series E Preferred Stock shall not be
entitled to any further right or claim to any of the remaining assets of the
Corporation.
(B) Neither the merger or consolidation of the Corporation with or
into any other corporation or other entity, nor the merger or consolidation
of any other corporation or other entity with or into the Corporation, nor
the sale, lease, exchange or other transfer of all or any portion of the
assets of the Corporation, shall be deemed to be a liquidation, dissolution
or winding up of the Corporation for purposes of this Section 5.
(C) Written notice of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, stating the payment date or
dates when, and the place or places where, the amounts distributable to
holders of Series E Preferred Stock in such circumstances shall be payable,
shall be made in accordance with Section 9 below not less than 20 days prior
to any payment date stated therein, to the holders of Series E Preferred
Stock, at their respective addresses shown on the books of the Corporation or
any transfer agent for the Series E Preferred Stock; provided, however, that
a failure to give notice as provided herein or any defect therein shall not
affect the Corporation's ability to consummate a voluntary or involuntary
liquidation, dissolution or winding up of the Corporation.
Section 6. Redemption. The Series E Preferred Stock will not be
redeemable prior to December 3, 1997. The Series E Preferred Stock will be
redeemable, at the option of the Corporation, in whole or in part, out of
funds legally available therefor, at any time, on or after December 3, 1997,
upon not less than 30 nor more than 90 days' notice, at a redemption price
per share of Series E Preferred Stock equal to the Liquidation Preference,
plus an amount equal to accrued and unpaid dividends to the redemption date.
On or subsequent to the redemption date, upon surrender of the certificates
for any shares to be redeemed pursuant to the provisions of this Section 6,
the redemption price of such shares shall be paid in cash. In the event that
the redemption price is either paid or made available for payment, then,
notwithstanding that the certificate or certificates evidencing any of the
shares of the Series E Preferred Stock shall not have been surrendered, all
rights with respect to such shares shall terminate, effective on the
redemption date, and any such certificate shall represent only the right to
receive the redemption price, without interest, upon surrender. No interest
shall accrue on the redemption price after the redemption date.
Section 7. Reacquired Shares. Any shares of Series E Preferred
Stock acquired by the Corporation by reason of the redemption of such shares
as provided hereby, or otherwise acquired, shall be retired and the
Corporation shall take all actions necessary to restore such shares to the
status of authorized but unissued shares of Preferred Stock, without par
value, of the Corporation, which shares may thereafter be reissued as part of
a new series of such Preferred Stock or as Series E Preferred Stock, as
permitted by law.
Section 8. Ranking. The Series E Preferred Stock will rank on a
parity as to payment of dividends and distribution of assets upon
liquidation, dissolution or winding up, whether voluntary or involuntary, of
the Corporation with the Corporation's Series B ESOP Convertible Preferred
Stock, Series C ESOP Convertible Preferred Stock and Series D Preferred Stock
(which are the only series of Preferred Stock currently outstanding) and
prior to the Corporation's Common Stock. The Series E Preferred Stock will
rank prior to the Corporation's Series A Junior Participating Preferred Stock
(the "Series A Preferred Stock") as to the payment of dividends and on a
parity with the Series A Preferred Stock as to distribution of assets upon
liquidation, dissolution or winding up, whether voluntary or involuntary, if
such Series A Preferred Stock is issued.
Section 9. Miscellaneous.
(A) All notices referred to herein shall be in writing, and
delivered personally, sent by courier, or by registered or certified mail
(postage prepaid, return receipt requested) addressed: (i) if to the
Corporation, to its office at One McDonald's Plaza, Oak Brook, Illinois 60521
(Attention: Secretary) or to the transfer agent designated by the Corporation
or (ii) if to any holder of Series E Preferred Stock, to such holder at the
address of such holder as listed in the stock record books of the Corporation
or (iii) to such other address as the Corporation or any such holder, as the
case may be, shall have designated by notice similarly given.
(B) The Corporation shall pay any and all stock transfer and
documentary stamp taxes that may be payable in respect of any issuance or
delivery of shares of Series E Preferred Stock or certificates representing
such shares. The Corporation shall not, however, be required to pay any such
tax which may be payable in respect of any transfer involved in the issuance
or delivery of shares of Series E Preferred Stock in a name other than the
name in which such shares of Series E Preferred Stock were registered, or in
respect of any payment to any person with respect to any such shares other
than a payment to the registered holder thereof, and shall not be required to
make any such issuance, delivery or payment unless and until the person
otherwise entitled to such issuance, delivery or payment has paid to the
Corporation the amount of any such tax or has established, to the
satisfaction of the Corporation, that such tax has been paid or is not
payable.
(C) Unless otherwise provided in the Certificate of Designations,
Preferences and Rights, as the same may be amended, all payments in the form
of dividends, distributions on voluntary or involuntary dissolution,
liquidation or winding-up otherwise made upon the shares of Series E
Preferred Stock and any other stock ranking on a parity with Series E
Preferred Stock with respect to such dividend or distribution shall be made
pro rata, so that amounts paid per share on Series E Preferred Stock and such
other stock shall in all cases bear to each other the same ratio that the
required dividends, distributions or payments, as the case may be, then
payable per share on the shares of the Series E Preferred Stock and such
other stock bear to each other.
(D) The Corporation may appoint, and from time to time discharge
and change, a transfer agent for Series E Preferred Stock. Upon any such
appointment or discharge of a transfer agent, the Corporation shall send
notice thereof in accordance with Section 9(A) to each holder of record of
Series E Preferred Stock.
FIFTH: The minimum amount of capital with which the Corporation
will commence business is One Thousand Dollars ($1,000).
SIXTH: The Corporation is to have perpetual existence.
SEVENTH: The private property of the stockholders of the
Corporation shall not be subject to the payment of corporate debts to any
extent whatsoever.
EIGHTH: In furtherance and not in limitation of the powers
conferred by the laws of the State of Delaware the Board of Directors is
expressly authorized and empowered:
(a) In the manner provided in the by-laws of the Corporation to
make, alter, amend and repeal the by-laws of the Corporation in any respect
not inconsistent with the laws of the State of Delaware or with the Restated
Certificate of Incorporation of the Corporation;
(b) By a resolution or resolutions passed by a majority of the
whole Board, to designate one or more committees, each committee to consist of
two or more of the directors of the Corporation which, to the extent provided
in said resolution or resolutions or in the by-laws of the Corporation, shall
have and may exercise the powers of the Board of Directors in the management
of the business and affairs of the Corporation, and may have power to
authorize the seal of the Corporation to be affixed to all papers which may
require it. Such committee or committees shall have such name or names as may
be stated in the by-laws of the Corporation or as may be determined from time
to time by resolution adopted by the Board of Directors;
(c) Subject to any applicable provisions of the by-laws of the
Corporation then in effect, to determine from time to time, whether and to
what extent and at what times and places and under what conditions and regula-
tions the accounts and books of the Corporation, 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 the Corporation, except as
conferred by the laws of the State of Delaware, unless and until authorized so
to do by resolution of the Board of Directors or of the stockholders of the
Corporation;
(d) To fix from time to time the amount of the surplus or profits
of the Corporation to be reserved as working capital or for any other lawful
purpose;
(e) Without any action by the stockholders, to authorize the
borrowing of moneys for any of the purposes of the Corporation and, from time
to time without limit as to amount, to authorize and cause the making, execu-
tion, issuance, sale or other disposition of promissory notes, drafts, bonds,
debentures and other negotiable or non-negotiable instruments and evidences of
indebtedness, and the securing of the same by mortgage, pledge, deed of trust
or otherwise.
In addition to the powers and authorities hereinbefore or by statute
expressly conferred upon it, the Board of Directors may exercise all such
powers and do all such acts and things as may be exercised, or done by the
Corporation, subject, nevertheless, to the provisions of the laws of the State
of Delaware, this Restated Certificate of Incorporation and the by-laws of the
Corporation.
Any contract, transaction or act of the Corporation or of the
directors or of any committee, which shall be ratified by the holders of a
majority of the shares of stock of the Corporation present in person or by
proxy and voting at any annual meeting, or at any special meeting called for
such purpose, shall, insofar as permitted by law or by this Restated
Certificate of Incorporation, be as valid and as binding as though ratified by
every stockholder of the Corporation.
The Corporation may enter into contracts or transact business with
one or more of its directors, or with any firm of which one or more of its
directors are members or with any trust, firm, corporation or association in
which any one or more of its directors is a stockholder, director or officer
or otherwise interested, and any such contract or transaction shall not be
invalidated in the absence of fraud because such director or directors have or
may have interests therein which are or might be adverse to the interest of
the Corporation, even though the presence and/or vote of the director or
directors having such adverse interest shall have been necessary to constitute
a quorum and/or to obligate the Corporation upon such contract or transaction,
provided that such interests shall have been disclosed to the other directors
and a majority of the directors voting shall have approved such contract or
transaction; and no director having such adverse interest shall be liable to
this Corporation or to any stockholder or creditor thereof, or to any other
person for any loss incurred by it under or by reason of any such contract or
transaction; nor shall any such director or directors be accountable for any
gains or profits realized thereon.
The Corporation shall have power to indemnify any and all of its
directors or officers or former directors or officers or any person who may
have served at its request as a director or officer of another corporation in
which it owns shares of capital stock or of which it is a creditor against
liabilities and expenses actually and necessarily incurred by them in
connection with the defense of any action, suit or proceeding in which they,
or any of them, are made parties, or a party, by reason of being or having
been directors or officers or a director or officer of the Corporation, or of
such other corporation, except in relation to matters as to which any such
director or officer or former director or officer or person shall be adjudged
in such action, suit or proceeding to be liable for negligence or misconduct
in the performance of duty. Such indemnification shall not be deemed exclusive
of any other rights to which those indemnified may be entitled, under any by-
law, agreement, vote of stockholders or otherwise.
NINTH: Meetings of stockholders may be held outside the State of
Delaware, if the by-laws so provide. The books of the Corporation may be kept
(subject to the laws of the State of Delaware) outside the State of Delaware
at such place or places as may be designated from time to time by the Board of
Directors or in the by-laws of the Corporation. Elections of directors need
not be by ballot unless the by-laws of the Corporation shall so provide.
TENTH: The Corporation reserves the right to amend, alter, change
or repeal any provision contained in this Restated Certificate of
Incorporation, to the extent and in the manner now or hereafter prescribed by
statute, and all rights conferred upon stockholders herein are granted subject
to this reservation.
ELEVENTH: It is hereby declared to be a proper corporate purpose,
reasonably calculated to benefit stockholders, for the Board of Directors to
base the response of the Corporation to any `Acquisition Proposal' on the
Board of Directors' evaluation of what is in the best interests of the
Corporation and for the Board of Directors, in evaluating what is in the best
interests of the Corporation, to consider:
(i) the best interest of the stockholders; for this purpose the
Board shall consider, among other factors, not only the consideration being
offered in the Acquisition Proposal, in relation to the then current market
price, but also in relation to the then current value of the Corporation in a
freely negotiated transaction and in relation to the Board of Directors' then
estimate of the future value of the Corporation as an independent entity; and
(ii) such other factors as the Board of Directors determines to be
relevant, including, among other factors, the social, legal and economic
effects upon franchisees, employees, suppliers, customers and business.
`Acquisition Proposal' means any proposal of any person (a) for a
tender offer or exchange offer for any equity security of the Corporation, (b)
to merge or consolidate the Corporation with another corporation, or (c) to
purchase or otherwise acquire all or substantially all of the properties and
assets of the Corporation.
TWELFTH: Subject to all other applicable provisions of this
Restated Certificate of Incorporation and to all applicable provisions of the
law of Delaware, relating, inter alia, to stockholder approval, the Board of
Directors shall have the power to merge or consolidate the Corporation with
another corporation or to sell, lease or exchange all or substantially all of
the property and assets of the Corporation, including its good will and its
corporate franchises, upon such terms and conditions and for such
consideration, which may be in whole or in part shares of stock in, and/or
other securities of, any corporation or corporations, as the Board of
Directors shall deem expedient and for the best interests of the Corporation,
but, regardless of any other provision of this Restated Certificate of
Incorporation, if any party to any such transaction shall be a person or
entity owning, immediately prior to the consummation of such transaction, of
record or beneficially, 2% or more of the stock of the Corporation issued and
outstanding having voting power, such power of the Board of Directors shall be
exercisable only when and as duly authorized by the affirmative vote of the
holders of not less than 66-2/3% of the stock of the Corporation issued and
outstanding having voting power given at a stockholders' meeting duly called
for that purpose; provided, however, that the Board of Directors shall have
the power to merge the Corporation with another corporation without action by
the stockholders to the extent and in the manner permitted from time to time
by the law of Delaware. In determining whether or not any person or entity
(the `Primary Holder') owns, of record or beneficially, 2% or more of the
stock of the Corporation issued and outstanding having voting power, there
shall be aggregated with all shares of such stock owned of record or
beneficially by the Primary Holder (a) all shares of such stock owned of
record or beneficially by any person or entity who or which would be deemed to
be controlling, controlled by or under common control with the Primary Holder
under the Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, any federal statute enacted to take the place of either or
both such statutes or any regulation promulgated under either of such statutes
or such successor statutes (an `Affiliate') and (b) all shares of such stock
owned of record or beneficially by any person or entity acting in concert with
the Primary Holder and/or with an Affiliate of the Primary Holder. This
Article Twelfth shall not be altered, amended or repealed except by the
affirmative vote of the holders of not less than 66-2/3% of the stock of the
Corporation issued and outstanding having voting power, given at a
stockholders' meeting duly called for that purpose, upon a proposal adopted by
the Board of Directors.
THIRTEENTH: Board of Directors.
(a) Number, Election and Terms. The business and affairs of the
Corporation shall be managed by or under the direction of a Board of Directors
consisting of not less than 11 nor more than 24 persons. The exact number of
directors within the minimum and maximum limitations specified in the
preceding sentence shall be fixed from time to time by the Board of Directors
pursuant to a resolution adopted by a majority of the entire Board of
Directors.
At the 1983 Annual Meeting of Stockholders, the directors shall be
divided into three classes, as nearly equal in number as possible, with the
term of office of the first class to expire at the 1984 annual meeting of
stockholders, the term of office of the second class to expire at the 1985
annual meeting of stockholders and the term of office of the third class to
expire at the 1986 annual meeting of stockholders.
At each annual meeting of stockholders following such initial
classification and election, directors elected to succeed those whose terms
then expire shall be elected for a term of office expiring at the third
succeeding annual meeting of stockholders after their election.
(b) Newly Created Directorships and Vacancies. Subject to the
rights of the holders of any series of Preferred Stock then outstanding, newly
created directorships resulting from any increase in the authorized number of
directors or any vacancies in the Board of Directors resulting from death,
resignation, retirement, disqualification, removal from office or other cause
shall be filled by a majority vote of the directors then in office. Directors
so chosen shall hold office for a term expiring at the annual meeting of
stockholders at which the term of the class to which they have been elected
expires. No decrease in the number of directors constituting the Board of
Directors shall shorten the term of any incumbent director.
(c) Removal. Subject to the rights of the holders of any series of
Preferred Stock then outstanding, any director, or the entire Board of
Directors, may be removed from office at any time, but only for cause and only
by the affirmative votes of the holders of at least 80% of the voting power of
all the shares of the Corporation entitled to vote for the election of
directors.
(d) Amendment, Repeal, Etc. Notwithstanding anything to the
contrary contained in this Restated Certificate of Incorporation, the
affirmative vote of the holders of at least 80% of the voting power of all of
the shares of the Corporation entitled to vote for the election of directors
shall be required to amend, alter or repeal, or to adopt any provision
inconsistent with, this Article Thirteenth.
FOURTEENTH: Stockholder Action. Any action required or permitted
to be taken by the stockholders of the Corporation must be effected at a duly
called annual or special meeting of stockholders of the Corporation and may
not be effected by any consent in writing by such stockholders. Special
meetings of stockholders of the Corporation may be called upon not less than
10 nor more than 60 days' written notice only by the Board of Directors
pursuant to a resolution approved by a majority of the Board of Directors.
Notwithstanding anything contained in this Restated Certificate of
Incorporation to the contrary, the affirmative vote of the holders of at least
80% of the voting power of all of the shares of the Corporation entitled to
vote for the election of directors shall be required to amend, alter or
repeal, or to adopt any provision inconsistent with, this Article Fourteenth.
FIFTEENTH: Elimination of Certain Liability of Directors. To the
fullest extent that the general corporate law of the State of Delaware, as it
exists on the date hereof or as it may hereafter be amended, permits the
limitation or elimination of the liability of directors, no director of the
Corporation shall be liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director. No amendment to
or repeal of this Article Fifteenth shall apply to or have any effect on
liability or alleged liability of any director of the Corporation for or with
respect to any acts or omissions of such director occurring prior to such
amendment or repeal.
EXHIBIT 3(ii)
BY-LAWS OF
McDONALD'S CORPORATION
ARTICLE I - OFFICES
Section 1 - Principal Office - The registered office shall be established and
maintained at the office of The Prentice Hall Corporation System Inc., in the
City of Dover, in the County of New Castle, in the State of Delaware; and said
Corporation shall be the resident agent of this Corporation in charge thereof.
Section 2 - Other Offices - The Corporation may also have an office in the
Village of Oak Brook, State of Illinois, and may also have other offices,
either within or without the State of Delaware, at such place or places as the
Board of Directors may from time to time appoint or the business of the
Corporation may require.
ARTICLE II - MEETINGS OF STOCKHOLDERS
Section 1 - Place of Meetings - The Annual Meeting of Stockholders and any
other meetings of stockholders shall be held at such place as may from time to
time be determined by the Board of Directors and set forth in a notice
thereof.
Section 2 - Annual Election of Directors - The Annual Meeting of Stockholders
for the election of Directors and the transaction of other business shall be
held each year on the date determined by the Board of Directors. If this date
shall fall upon a legal holiday, the meeting shall be held on the next
succeeding business day. At each annual meeting, the stockholders entitled to
vote shall elect Directors to succeed those whose terms then expire and may
transact any other proper business. Any previously scheduled meeting of the
stockholders may be postponed by resolution of the Board of Directors upon
public notice given prior to the date previously scheduled for such meeting of
stockholders.
Section 3 - Voting - Each stockholder entitled to vote in accordance with the
terms of the Certificate of Incorporation and in accordance with the
provisions of these By-Laws shall be entitled to one vote (or such lesser
number of votes as may be provided with respect to holders of any series of
Preferred Stock in a resolution of the Board of Directors adopted pursuant to
the Certificate of Incorporation), in person or by proxy, for each share of
stock entitled to vote held by such stockholder but no proxy shall be voted
after three (3) years from its date unless such proxy provides for a longer
period. Any motion brought before a stockholder meeting must be seconded
before a vote will be taken. All votes by stockholders on proposed amendments
to the Certificate of Incorporation and all elections of Directors, shall be
by written ballot. All elections for Directors shall be decided by a
plurality of the votes of the shares present at the meeting, in person or by
proxy, and entitled to vote on the election of directors; all other questions
shall be decided by majority vote of the shares entitled to vote on the
subject matter and present, in person or by proxy, at the meeting, except as
otherwise provided by the Certificate of Incorporation or the laws of the
State of Delaware; and where a separate vote by class is required, the
affirmative vote of the majority of shares of such class present in person or
represented by proxy at the meeting shall be the act of such class.
Section 4 - Quorum - At all meetings of stockholders, except as otherwise
required by law, by the Certificate of Incorporation, or by these By-Laws, a
majority of the shares entitled to vote, whether present in person or
represented by proxy, shall constitute a quorum. Whether or not there is such
a quorum present at any meeting, the chairman of the meeting or a majority of
the shares so present or represented, shall have power to adjourn the meeting
from time to time. No notice of the time and place of adjourned meetings need
be given except as required by law. At any such adjourned meeting at which
the requisite amount of stock entitled to vote shall be represented, any
business may be transacted which might have been transacted at the meeting as
originally noticed. If the adjournment is for more than thirty (30) 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.
Section 5 - Special Meetings - Special meetings of the stockholders for any
purpose or purposes may be called only by the Board of Directors pursuant to a
resolution approved by a majority of the Board of Directors and shall be
called by the Secretary in accordance with any such resolution.
Section 6 - Notice of Meetings - Written or printed notice stating the place,
date, and hour of the meeting and the purpose or purposes for which the
meeting is called, shall be given by the Secretary to each stockholder
entitled to vote thereat at his address as it appears on the records of the
Corporation not less than ten (l0) nor more than sixty (60) days before the
date of the meeting. Business transacted at any special meeting shall be
confined to the purpose or purposes stated in the notice of such special
meeting.
Section 7 - No Action Without Meeting - Any action required or permitted to be
taken by the stockholders of the Corporation must be effected at a duly called
annual or special meeting of stockholders of the Corporation and may not be
effected by any consent in writing by such stockholders.
Section 8 - Nomination and Stockholder Business -
(A) Annual Meetings of Stockholders - (1) Nominations of persons for
election to the Board of Directors of the Corporation and the proposal of
business to be considered by the stockholders at an annual meeting of
stockholders may be made (a) pursuant to the Corporation's notice of meeting,
(b) by or at the direction of the Board of Directors or (c) by any stockholder
of the Corporation who was a stockholder of record at the time of giving of
notice provided for in this Section 8, who is entitled to vote at the meeting
and who complied with the notice procedures set forth in this Section 8.
(2) For nominations or other business to be properly brought before
an annual meeting by a stockholder pursuant to clause (c) of paragraph (A)(1)
of this Section 8, such business, as determined by the Chairman of the
meeting, must be a proper subject for stockholder action under Delaware
corporation law, and the stockholder must have given timely notice thereof in
writing to the Secretary of the Corporation. To be timely, a stockholder's
notice shall be delivered to the Secretary at the principal executive offices
of the Corporation not less than sixty (60) days nor more than ninety (90)
days prior to the first anniversary of the preceding year's annual meeting;
provided, however, that in the event that the date of the annual meeting is
advanced by more than thirty (30) days or delayed by more than sixty (60) days
from such anniversary date, notice by the stockholder to be timely must be so
delivered not earlier than the ninetieth (90th) day prior to such annual
meeting and not later than the close of business on the later of the sixtieth
(60th) day prior to such annual meeting or the tenth (10th) day following the
date on which public announcement of the date of such meeting is first made.
Such stockholder's notice shall set forth (a) as to each person whom the
stockholder proposes to nominate for election or reelection as a director all
information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required,
in each case pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended (the ``Exchange Act'') (including such person's written
consent to being named in the proxy statement as a nominee and to serving as a
director if elected) and a representation as to whether or not the stockholder
intends to solicit proxies in support of such proposed nominee; (b) as to any
other business that the stockholder proposes to bring before the meeting, a
brief description of the business desired to be brought before the meeting,
the reasons for conducting such business at the meeting, any material interest
in such business of such stockholder and the beneficial owner, if any, on
whose behalf the proposal is made, and a representation as to whether or not
the stockholder intends to solicit proxies in support of such proposal; and
(c) as to the stockholder giving the notice and the beneficial owner, if any,
on whose behalf the nomination or proposal is made (i) the name and address of
such stockholder, as they appear on the Corporation's books, and of such
beneficial owner and (ii) the class and number of shares of the Corporation
which are owned beneficially and of record by such stockholder and such
beneficial owner.
(3) Notwithstanding anything in the second sentence of paragraph
(A)(2) of this Section 8 to the contrary, in the event that the number of
directors to be elected to the Board of Directors of the Corporation is
increased and there is no public announcement naming all of the nominees for
Directors or specifying the size of the increased Board of Directors made by
the Corporation at least seventy (70) days prior to the first anniversary of
the preceding year's annual meeting, a stockholder's notice required by this
Section 8 shall also be considered timely, but only with respect to nominees
for any new positions created by such increase, if it shall be delivered to
the Secretary at the principal executive offices of the Corporation not later
than the close of business on the tenth (10th) day following the day on which
such public announcement is first made by the Corporation.
(B) Special Meetings of Stockholders - Only such business shall be
conducted at a special meeting of stockholders as shall have been brought
before the meeting of stockholders pursuant to the Corporation's notice of
meeting. Nominations of persons for election to the Board of Directors may be
made at a special meeting of stockholders at which directors are to be elected
pursuant to the Corporation's notice of meeting (a) by or at the direction of
the Board of Directors or (b) by any stockholder of the Corporation who is a
stockholder of record at the time of giving of notice provided for in this
Section 8, who shall be entitled to vote at the meeting and who complies with
the notice procedures set forth in this Section 8. Nominations by
stockholders of such persons for election to the Board of Directors may be
made at such a special meeting of stockholders if the stockholder's notice
required by paragraph (A)(2) of this Section 8 shall be delivered to the
Secretary at the principal executive offices of the Corporation not earlier
than the ninetieth (90th) day prior to such special meeting and not later than
the close of business on the later of the sixtieth (60th) day prior to such
special meeting or the tenth (10th) day following the day on which public
announcement is first made of the date of the special meeting and of the
nominees proposed by the Board of Directors to be elected at such meeting.
(C) General - (1) Only such persons who are nominated in accordance
with the procedures set forth in this Section 8 shall be eligible to serve as
directors and only such business shall be conducted at a meeting of
stockholders as shall have been brought before the meeting in accordance with
the procedures set forth in this Section 8. The Chairman of the meeting shall
have the power and duty to determine whether a nomination or any business
proposed to be brought before the meeting was made in accordance with the
procedures set forth in this Section 8 and, if any proposed nomination or
business is not in compliance with this Section 8 or if the stockholder
solicits proxies in support of such stockholder's proposed nomination or
proposed business without such stockholder having made the representation
required by paragraph (A)(2) of this Section 8, to declare that such defective
proposal shall be disregarded.
(2) For purposes of this Section 8, ``public announcement'' shall
mean disclosure in a press release reported by the Dow Jones News Service,
Associated Press or comparable national news service or in a document publicly
filed by the Corporation with the Securities and Exchange Commission pursuant
to Section 13, 14 or 15(d) of the Exchange Act.
(3) Notwithstanding the foregoing provisions of this Section 8, a
stockholder shall also comply with all applicable requirements of the Exchange
Act and the rules and regulations thereunder with respect to the matters set
forth in this Section 8. Nothing in this Section 8 shall be deemed to affect
any rights of stockholders to request inclusion of proposals in the
Corporation's proxy statement pursuant to Rule 14a-8 under the Exchange Act.
ARTICLE III - DIRECTORS
Section 1 - Number and Term - The number of Directors who shall constitute the
whole Board of Directors shall be the number fixed from time to time by the
Board of Directors in accordance with the Certificate of Incorporation and
shall in no event be less than eleven (11) nor more than twenty-four (24). At
the 1983 Annual Meeting of Stockholders, the Directors were divided into three
(3) classes, as nearly equal in number as possible with the term of office of
the first class to expire at the 1984 Annual Meeting of Stockholders, the term
of office of the second class to expire at the 1985 Annual Meeting of Stock-
holders, and the term of office of the third class to expire at the 1986
Annual Meeting of Stockholders. At each Annual Meeting of Stockholders
following such initial classification and election, Directors elected to
succeed those whose terms then expire shall be elected for a term of office
expiring at the third succeeding Annual Meeting of Stockholders after their
election and until their successors shall be elected and shall qualify.
Section 2 - Resignations - Any Director or member of a committee of the Board
of Directors may resign at any time. Such resignation shall be made in
writing and shall take effect at the time specified therein and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.
Section 3 - Newly-Created Directorships and Vacancies - Subject to the rights
of the holders of any series of Preferred Stock then outstanding, newly-
created directorships resulting from any increase in the authorized number of
Directors or any vacancies in the Board of Directors resulting from death,
resignation, retirement, disqualification, removal from office or other cause
shall be filled by a majority vote of the Directors then in office, though
less than a quorum. Directors so chosen shall hold office for a term expiring
at the Annual Meeting of Stockholders at which the term of the class to which
they have been elected expires and until their successors shall be elected and
shall qualify. No decrease in the number of Directors constituting the Board
of Directors shall shorten the term of any incumbent Director.
Section 4 - Removal - Subject to the rights of the holders of any series of
Preferred Stock then outstanding, any Director, or the entire Board of
Directors, may be removed from office at any time but only for cause and only
by the affirmative vote of the holders of eighty percent (80%) of the voting
power of all of the shares of the Corporation entitled to vote for the elec-
tion of Directors.
Section 5 - Powers - The Board of Directors shall exercise all of the powers
of the Corporation, except such as are by law or by the Certificate of
Incorporation of the Corporation or by these By-Laws conferred upon or
reserved to the stockholders.
Section 6 - Committees -
(A) Executive Committee - There shall be an Executive Committee of the
Board of Directors selected from time to time by the Board of Directors from
among its own membership. Except as hereinafter provided, the Executive
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, and may authorize the seal of the Corporation to be affixed to
all papers which may require it. Except as otherwise specified in a
resolution of the Board of Directors, the Executive Committee shall not have
the power or authority of the Board of Directors in reference to:
(i) recommending to the stockholders the sale, lease or exchange of all or
substantially all of the Corporation's property and assets; (ii) recommending
to the stockholders a dissolution of the Corporation or a revocation of a
dissolution; (iii) issuing stock; (iv) appointing or removing an officer or
Director of the Corporation; or (v) fixing the designations and any of the
preferences or rights of shares relating to dividends, redemption, dissolution
any distribution of assets of the Corporation or the conversion into, or the
exchange of such shares for, shares of any other class or classes or any other
series of the same or any other class or classes of stock of the Corporation
or fix the number of shares of any series of stock or authorize the increase
or decrease of the shares of any series.
(B) Other Committees of the Board - The Board of Directors may, by
resolution or resolutions passed by a majority of Directors present at any
meeting at which there is a quorum, designate one or more other committees,
each committee to consist of two or more of the Directors of the Corporation
which, to the extent provided in said resolution or resolutions or in these
By-Laws shall have and may exercise the powers of the Board of Directors in
the management of the business and affairs of the Corporation and may have
power to authorize the seal of the Corporation to be affixed to all papers
which may require it.
(C) Limitation on Committee Authority - No committee shall have the
power or authority of the Board of Directors in reference to (i) approving or
adopting, or recommending to the stockholders, any action or matter expressly
required by the Delaware General Corporation Law to be submitted to
stockholders for approval; or (ii) adopting, amending or repealing the By-Laws
of the Corporation.
(D) Procedural Provisions - A majority of the members of a committee
shall constitute a quorum for the transaction of business, and the act of a
majority of such members present at any meeting at which there is a quorum
shall be the act of such committee. If at any meeting of a committee there
shall be less than a quorum present, a majority of those members present may
adjourn the meeting from time to time until a quorum is obtained, and no
further notice thereof need be given other than by announcement at the meeting
which shall be so adjourned. Notwithstanding the foregoing, (i) any action of
the Executive Committee shall be taken only with the unanimous approval of all
its members; and (ii) at the request of any member of the Executive Committee,
consideration of any action proposed to be taken by the Committee shall be
deferred to the Board of Directors.
The Board of Directors may designate one or more Directors as alternate
members of any committee who may replace any absent or disqualified member at
any meeting of the committee. Such committee or committees shall have such
name or names as may be stated in these By-Laws or as may be determined from
time to time by resolution adopted by the Board of Directors.
Each committee shall keep regular minutes of its proceedings and report its
acts and proceedings to the Board.
Section 7 - Meetings - The newly-elected Directors may hold their first
meeting for the purpose of organization and the transaction of business, if a
quorum be present, immediately after the Annual Meeting of the Stockholders,
or the time and place of such meeting may be fixed by consent in writing of
all the Directors. Commencing in 1984, the Board of Directors may, without
notice, hold its first meeting subsequent to the election of a class of
Directors for the purpose of organization and the transaction of business, if
a quorum be present, immediately after the Annual Meeting of the Stockholders,
or the time and place of such meeting may be fixed by consent in writing of
all the Directors.
Regular meetings of the Board of Directors may be held without notice at such
places, within or without the State of Delaware, and times as shall be
determined from time to time by resolution of the Directors.
Special meetings of the Board of Directors may be called by the Chairman of
the Board or the President and shall be called by the Secretary at the
direction of the Chairman of the Board or the President or on the written
request of any two (2) Directors on notice to each Director sent at least
twenty-four (24) hours prior to each such meeting. Notice of each such
meeting shall be delivered personally to each Director or sent by telegram,
telex, or electronic mail to such a place as designated from time to time by
each Director or, in the absence of any such designation, to the Director's
last known place of business or residence. Any such meeting shall be held at
such place or places, within or without the State of Delaware, and times as
may be determined by the Directors or as shall be stated in the notice.
Section 8 - Quorum - A majority of the Directors shall constitute a quorum for
the transaction of business and the act of a majority of the Directors present
at any meeting at which there is a quorum shall be the act of the Board of
Directors, except as may be otherwise specifically provided by the Certificate
of Incorporation, the laws of the State of Delaware, or these By-Laws. If at
any meeting of the Board of Directors there shall be less than a quorum
present, a majority of those present may adjourn the meeting from time to time
until a quorum is obtained and no further notice thereof need be given other
than by announcement at the meeting which shall be so adjourned.
Section 9 - Compensation - No employee of the Company shall receive any
additional compensation or remuneration for serving as a member of the Board
of Directors. By resolution of the Board of Directors, those members of the
Board of Directors who are not otherwise employed by the Company may receive a
fixed fee, payable quarterly, together with a fee for attendance at each
meeting. For purposes of this Section, members of the Board of Directors who
serve the Company in capacities, such as outside consultants, attorneys, or
business advisors, shall not be considered by virtue of such service as being
employed by the Company. Nothing herein contained shall be construed to
preclude any Director from serving the Corporation in any other capacity as an
officer, agent, or otherwise and receiving compensation therefor.
Section 10 - Action Without Meeting - Unless otherwise restricted by the
Certificate of Incorporation or the 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 of Direc-
tors, or of such committee, as the case may be, consent thereto in writing and
such written consent is filed with the minutes of proceedings of the Board of
Directors or committee.
ARTICLE IV - OFFICERS
Section 1 - Officers - The Corporation shall have such officers with such
titles and duties as shall be stated in these By-Laws. Except as provided in
Article IV, Section 2 of these By-Laws, all of such officers shall be
appointed by the Board of Directors. None of the officers, except the Chief
Executive Officer, Senior Chairman and Chairman of the Board need be
Directors. No person shall hold the office of Secretary who at that time also
holds the office of Senior Chairman, Chairman of the Board or Chief Executive
Officer.
Section 2 - Other Officers - In addition to the officers described in these
By-Laws, the Corporation may have: (i) officers with such titles and duties
as may be determined by any resolution of the Board of Directors which is not
inconsistent with these By-Laws; and (ii) such vice presidents and assistant
vice presidents as may be appointed by the Chief Executive Officer with such
duties as may be determined by the Chief Executive Officer. In addition, the
Chief Executive Officer shall have the right to designate additional titles
(such as, by way of example and not as a limitation, Zone Vice President,
Chief Operations Officer, Chief Marketing Officer) for any officers appointed
in accordance herewith as he or she may determine as necessary or appropriate.
The Chief Executive Officer may also appoint one or more assistant, U.S. and
international controllers; international, assistant, associate and deputy
general counsels; and assistant treasurers as he or she may deem necessary,
who shall hold such office for such term and shall exercise such power and
perform such duties as shall be determined from time to time by the Chief
Executive Officer.
Section 3 - Salaries - The salaries of officers of the Corporation appointed
by the Board of Directors shall be fixed by the Board of Directors.
Section 4 - Term of Office - Each officer of the Corporation shall hold his or
her office until his or her successor is elected and qualified or until his or
her earlier resignation or removal. Any officer may resign at any time upon
written notice to the Corporation. Any officer elected or appointed by the
Board of Directors or the Chief Executive Officer may be removed at any time
by the affirmative vote of a majority of the Board of Directors. Except as
provided in Article IV, Section 2 of these By-Laws, any vacancy occurring in
any office of the Corporation shall be filled by the Board of Directors.
Section 5 - Senior Chairman - The Senior Chairman shall consult with the
Chairman of the Board, Chief Executive Officer, Chairman - U.S.A., President
and Chief Executive Officer - U.S.A., and President and Chief Executive
Officer - International on the management of the Corporation and shall assist
and cooperate with the other officers of the Corporation in carrying out all
orders, resolutions, duties, and policies adopted or established by the Board
of Directors of the Corporation. In the event of the inability of the
Chairman to act, the Senior Chairman shall preside at all meetings of the
stockholders of the Corporation and of the Board of Directors of the
Corporation.
Section 6 - Chairman of the Board - The Chairman of the Board shall preside
at all meetings of the stockholders of the Corporation and of the Board of
Directors; he or she shall see that all orders, resolutions, and policies
adopted or established by the Board of Directors are carried into effect; and
he or she shall do and perform such other duties as from time to time may be
assigned by the Board of Directors of the Corporation.
Section 7 - Chief Executive Officer - The Chief Executive Officer shall have
responsibility for the general and active management of the business of the
Corporation and shall do and perform such other duties as from time to time
may be assigned to the Chief Executive Officer by the Board of Directors.
Section 8 - Vice Chairman of the Board - The Vice Chairman of the Board shall
report to the Chief Executive Officer; he or she shall be responsible for the
implementation of orders, resolutions, and policies adopted or established by
the Board of Directors and the Chief Executive Officer; and he or she shall do
and perform such other duties as from time to time may be assigned by the
Board of Directors or Chief Executive Officer. In addition, in the event of
the inability of the Chairman of the Board or the Senior Chairman to act, he
or she shall preside at all meetings of the stockholders of the Corporation
and of the Board of Directors of the Corporation.
Section 9 - Chairman - U.S.A. - The Chairman - U.S.A. shall report to the
Chief Executive Officer; he or she shall oversee the direction of United
States operations and shall be responsible for the implementation of orders,
resolutions and policies adopted or established by the Board of Directors and
Chief Executive Officer; and he or she shall do and perform such other duties
as from time to time may be assigned by the Board of Directors or the Chief
Executive Officer.
Section 10 - President and Chief Executive Officer - U.S.A. - The President
and Chief Executive Officer - U.S.A. shall report to the Chairman - U.S.A.; he
or she shall direct United States operations and shall be responsible for the
day-to-day activities of the Corporation in the United States; and he or she
shall do and perform such other duties as from time to time may be assigned by
the Board of Directors, the Chief Executive Officer or the Chairman - U.S.A..
Section 11 - President and Chief Executive Officer - International - The
President and Chief Executive Officer - International shall report to the
Chief Executive Officer; he or she shall direct international operations and
shall be responsible for the day-to-day activities of the Corporation in
international markets; and he or she shall do and perform such other duties as
from time to time may be assigned by the Board of Directors or the Chief
Executive Officer.
Section 12 - Other Offices - The following officers shall report to such
person as the Chief Executive Officer may designate and, in addition to the
duties which may be outlined below, shall do and perform such duties as from
time to time may be assigned to such officer by the Board of Directors or the
Chief Executive Officer.
(A) Executive and Senior Vice Presidents - One or more Senior Executive
Vice Presidents, Executive Vice Presidents, and Senior Vice Presidents may be
appointed by the Board of Directors.
(B) Chief Financial Officer - The Chief Financial Officer shall direct
all of the financial activities of the Corporation. The Chief Financial
Officer shall have such power and exercise such authority as deemed necessary
or desirable to maintain the financial integrity of the Corporation.
(C) Controller - The Controller shall be the principal accounting
officer of the Corporation and shall keep or shall cause to be kept a true
account of all transactions and of the assets and liabilities of the
Corporation. The Controller shall prepare and submit to the Chief Financial
Officer or, in the absence of the Chief Financial Officer to the Chief
Executive Officer, such financial statements and schedules as may be required
to keep the Chief Financial Officer and Chief Executive Officer currently
informed of the operations and financial condition of the Corporation.
(D) General Counsel - The General Counsel shall be a licensed attorney
at law and shall be the principal legal officer of the Corporation. The
General Counsel shall have such power, exercise such authority and provide
such counsel to the Corporation as deemed necessary or desirable to enforce
the rights and protect the property and integrity of the Corporation.
(E) Treasurer - The Treasurer shall have custody of the Corporate funds
and securities and shall keep full and accurate account of receipts and
disbursements in books belonging to the Corporation. He or she shall deposit
all monies and other valuables in the name and to the credit of the
Corporation in such depositories as may be designated by the Board of
Directors.
The Treasurer shall disburse the funds of the Corporation as may be
ordered by the Board of Directors or the Chief Executive Officer, taking
proper vouchers for such disbursements. He or she shall render to the
Chairman of the Board, Chief Executive Officer and the Board of Directors, at
the regular meetings of the Board of Directors, or whenever they may request
it, an account of all his or her transactions as Treasurer and of the
financial condition of the Corporation. If required by the Board of
Directors, he or she shall give the Corporation a bond (which shall be renewed
every six (6) years) in such sum and with such surety or sureties as shall be
satisfactory to the Board of Directors for the faithful performance of the
duties of his or her office and for the restoration to the Corporation, in
case of his or her death, resignation, retirement, or removal from office, of
all books, papers, vouchers, money, and other property of whatever kind in his
or her possession or under his or her control belonging to the Corporation.
(F) Secretary - The Secretary shall give, or cause to be given, notice
of all meetings of stockholders and Directors and all other notices required
by law or by these By-Laws; and in the case of his or her absence or refusal
or neglect so to do, any such notice may be given by any person thereunto
directed by the Chairman of the Board or by the Board of Directors or
stockholders upon whose requisition the meeting is called as provided in these
By-Laws. He or she shall record all the proceedings of the meetings of the
Corporation and of the Board of Directors. He or she shall have custody of
the seal of the Corporation and shall have the authority to affix the same to
all instruments requiring it and to attest the same. The Board of Directors
may appoint one or more Assistant Secretaries who, in the order determined by
the Chief Executive Officer, shall, in the absence or disability of the
Secretary, perform the duties of the Secretary; and who shall have the
authority to affix the seal of the Corporation and to attest the same. The
Board of Directors may also give general authority to any other officer to
affix the seal of the Corporation and to attest the same.
ARTICLE V - INDEMNIFICATION AND INSURANCE
Section 1 - Right to Indemnification -
(A) Indemnified Persons - Each person who was or is made a party or is
threatened to be made a party to or is involved in or called as a witness in
any Proceeding because he or she is an Indemnified Person, shall be
indemnified and held harmless by the Corporation to the fullest extent
permitted under the Delaware General Corporation Law (the ``DGCL''), as the
same now exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the Corporation to
provide broader indemnification rights than the DGCL permitted the Corporation
to provide prior to such amendment). Such indemnification shall cover all
expenses incurred by an Indemnified Person (including, but not limited to,
attorneys' fees and other expenses of litigation) and all liabilities and
losses (including, but not limited to, judgments, fines, ERISA or other excise
taxes or penalties and amounts paid or to be paid in settlement) incurred by
such person in connection therewith.
(B) Additional Indemnified Persons - (1) Each Additional Indemnified
Person who was or is made a party or is threatened to be made a party to or is
involved in or called as a witness in any Proceeding (other than an action by
or in the right of the Corporation) because he or she is an Additional
Indemnified Person shall be indemnified and held harmless by the Corporation
against expenses (including, but not limited to, attorneys' fees and other
expenses of litigation) and all liabilities and losses (including, but not
limited to, judgments, fines, ERISA or other excise taxes or penalties and
amounts paid or to be paid in settlement) incurred by such person in
connection therewith if such Additional Indemnified Person acted in Good
Faith. The termination of any Proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent shall not of
itself create a presumption that an Additional Indemnified Person did not act
in Good Faith.
(2) Each Additional Indemnified Person who was or is made a party
or is threatened to be made a party to or is involved in or called as a
witness in any Proceeding brought by or in the right of the Corporation to
procure a judgment in its favor because he or she is an Additional Indemnified
Person shall be indemnified and held harmless by the Corporation against
expenses (including, but not limited to, attorneys' fees and other expenses of
litigation) incurred by such person in connection therewith if such Additional
Indemnified Person acted in Good Faith, except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the
performance of such person's duty to the Corporation unless and only to the
extent that the Court of Chancery of the State of Delaware or the court in
which such Proceeding shall have been brought or is pending shall determine
upon application that despite the adjudication of liability but in view of all
the circumstances of the case, such Additional Indemnified Person is fairly
and reasonably entitled to indemnity for such expenses which such Court of
Chancery or such other court shall deem proper.
(3) Any indemnification under paragraphs (B)(1) or (B)(2) of this
Section 1 (unless ordered by a court) shall be made by the Corporation unless
it is determined that indemnification of the Additional Indemnified Person is
not proper in the circumstances because such person has not met the applicable
standard of conduct set forth in either paragraph (B)(1) or (B)(2) of this
Section 1. Such determination shall be made: (a) by the Board of Directors
of the Corporation by a majority vote of a quorum consisting of Directors who
are not parties to such Proceeding, or (b) if such a quorum is not obtainable,
or, even if obtainable if a quorum of disinterested Directors so directs, by
independent legal counsel in a written opinion. Such determination shall be
made within one hundred twenty (120) days (or such longer period established
as set forth in the next sentence) after receipt by the Board of Directors of
written notice from the Additional Indemnified Person seeking indemnification
setting forth in reasonable detail the facts known to such person concerning
the Proceeding. The period during which the Board of Directors may determine
that indemnification is not proper may be extended to a period established by
the Board of Directors by written notice to the Additional Indemnified Person
delivered to such person within one hundred twenty (120) days after receipt by
the Board of Directors of such person's written notice seeking indemnifi-
cation.
(C) Denial of Authorization for Certain Proceedings - Notwithstanding
anything to the contrary in this Article V, except with respect to
indemnification of Indemnified Persons specified in Section 3 of this Article
V, the Corporation shall indemnify an Indemnified Person or Additional
Indemnified Person in connection with a Proceeding (or part thereof) initiated
by such person only if (i) authorization for such Proceeding (or part thereof)
was not denied by the Board of Directors of the Corporation prior to the
earlier of (x) sixty (60) days after receipt of notice thereof from such
Indemnified Person or one hundred twenty (120) days after receipt of notice
thereof from such Additional Indemnified Person, as the case may be, or (y) a
Change of Control, and (ii) in the case of a Proceeding initiated by an
Additional Indemnified Person, it is not a Proceeding to enforce rights under
this Article V.
(D) Certain Defined Terms - For purposes of this Article V, the
following terms shall have the following means (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
(i) a ``Proceeding'' is any investigation, action, suit or
proceeding, whether civil, criminal, administrative or
investigative, and any appeal therefrom;
(ii) an ``Indemnified Person'' is a person who is, was, or had
agreed to become (A) a Director of the Corporation
(including, in the case of such person seeking indemnifica-
tion while serving as a Director who is or was an officer of
the Corporation, such person in his capacity as an officer)
or (B) an officer, employee or a Delegate, as defined herein,
of the Corporation (but, except as included within clause
(A), with respect to such officers, employees and Delegates
and persons agreeing to become officers, employees or
Delegates only as to Proceedings occurring after a Change of
Control, as defined herein, arising out of acts, events or
omissions occurring prior or subsequent to, or simultaneously
with, such Change of Control), or the legal representative or
any of the foregoing;
(iii) a ``Delegate'' is (A) any employee of the Corporation serving
as a director or officer (or in a substantially similar
capacity) of an entity or enterprise (x) in which the
Corporation owns a l0% or greater equity interest or (y) the
principal function of which is to service or benefit the
Corporation or its licensees; (B) any employee of the
Corporation serving as a trustee or fiduciary of an employee
benefit plan of the Corporation or any entity or enterprise
referred to in clause (A); and (C) any employee serving at
the request of the Corporation in any capacity with any
entity or enterprise other than the Corporation;
(iv) a ``Change of Control'' shall be deemed to have occurred if
(A) any ``Person'' (as that term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) is
or becomes (except in a transaction approved in advance by
the Board of Directors of the Corporation) the beneficial
owner (as defined in Rule 13d-3 under such Act), directly or
indirectly, of securities of the Corporation representing 20%
or more of the combined voting power of the Corporation's
then outstanding securities, or (B) during any period of two
consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of the Corporation
cease for any reason to constitute at least a majority
thereof unless the election of each Director who was not a
Director at the beginning of the period was approved by a
vote of at least two-thirds of the Directors then still in
office who were Directors at the beginning of the period;
(v) an ``Additional Indemnified Person'' is a person who is, was,
or had agreed to become an officer, Delegate or employee of
the Corporation and who is not an Indemnified Person; and
(vi) ``Good Faith'' shall mean with respect to any Additional
Indemnified Person that such person acted in good faith and
in a manner such person reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with
respect to any criminal Proceeding, such person had no
reasonable cause to believe such conduct was unlawful.
Section 2 - Expenses - Expenses, including attorneys' fees, incurred by a
person indemnified pursuant to Section 1 of this Article V in defending or
otherwise being involved in a Proceeding shall be paid by the Corporation in
advance of the final disposition of such Proceeding, including any appeal
therefrom, upon receipt of an undertaking (the ``Undertaking'') by or on
behalf of such person to repay such amount if it shall ultimately be
determined that he or she is not entitled to be indemnified by the
Corporation; provided, that (A) if a Change of Control has occurred, such
person shall be required to deliver to the Corporation the Undertaking only if
such an undertaking is required under the DGCL then in effect, and (B) in
connection with a Proceeding (or part thereof) initiated by such person,
except a Proceeding authorized by Section 3 of this Article V, the Corporation
shall pay said expenses in advance of final disposition only if authorization
for such Proceeding (or part thereof) was not denied by the Board of Directors
of the Corporation prior to the earlier of (i) sixty (60) days in the case of
an Indemnified Person, or one hundred twenty (120) days in the case of an
Additional Indemnified Person, after receipt of a request for such advancement
accompanied by the Undertaking or (ii) a Change of Control. A person to whom
expenses are advanced pursuant hereto shall not be obligated to repay pursuant
to the Undertaking until the final determination of any pending Proceeding in
a court of competent jurisdiction concerning the right of such person to be
indemnified or the obligation of such person to repay such expenses.
Section 3 - Protection of Rights - If a claim by an Indemnified Person under
Section 1 of this Article V is not promptly paid in full by the Corporation
after a written claim has been received by the Corporation or if expenses
pursuant to Section 2 of this Article V have not been promptly advanced after
a written request for such advancement by an Indemnified Person (accompanied
by the Undertaking if required by Section 2 of this Article V) has been
received by the Corporation, the claimant may at any time thereafter bring
suit against the Corporation to recover the unpaid amount of the claim or the
advancement of expenses. If successful, in whole or in part, in such suit,
such claimant shall also be entitled to be paid the reasonable expense
thereof. It shall be a defense to any such action (other than an action
brought to enforce a claim for expenses incurred in defending any Proceeding
in advance of its final disposition where the Undertaking has been tendered to
the Corporation (or, if a Change of Control has occurred, the Undertaking is
not required to be tendered to the Corporation under the DGCL) that
indemnification of the claimant is prohibited by law, but the burden of
proving such defense shall be on the Corporation. If a Change of Control has
occurred, a claimant making a claim under Section 1 of this Article V or
seeking to avoid repayment to the Corporation of expenses advanced pursuant to
Section 2 of this Article V shall have (i) the right, but not the obligation,
to have a determination made by independent legal counsel, at the expense of
the Corporation, as to whether indemnification of the claimant is prohibited
by law; and (ii) shall have the right (A) to select as independent legal
counsel to make such determination any legal counsel designated for such
purpose in a resolution adopted by the Board of Directors that is in full
force and effect immediately prior to the Change of Control or (B), if the
Board of Directors has failed to designate any such legal counsel or all such
counsel refuse to make such a determination, to request the American
Arbitration Association, at the expense of the Corporation, to select an
independent legal counsel familiar with matters of the type in dispute to make
such a determination. If a determination has been made in accordance with the
preceding sentence, no determination inconsistent therewith by other legal
counsel, by the Board of Directors, or by stockholders shall be of any force
or effect. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel, or its stockholders) to have made a
determination, if required, prior to the commencement of such action that
indemnification of the claimant is proper in the circumstances, nor an actual
determination by the Corporation (including its Board of Directors,
independent legal counsel, or its stockholders) that indemnification of the
claimant is prohibited, shall be a defense to the action or create a
presumption that indemnification of the claimant is prohibited.
Section 4 - Miscellaneous -
(A) 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, By-Law, agreement, vote of stockholders or disinterested
Directors or otherwise. The Board of Directors shall have the authority, by
resolution, to provide for such indemnification of agents of the Corporation
or others and for such other indemnification of Directors, officers, Delegates
or employees, of the Corporation as it shall deem appropriate.
(B) Insurance, contracts, and funding - The Corporation may maintain
insurance, at its expense, to protect itself and any Director, officer,
Delegate, employee, or agent of, the Corporation against any expenses,
liabilities or losses, whether or not the Corporation would have the power to
indemnify such person against such expenses, liabilities or losses under the
DGCL. The Corporation hereby agrees that, for a period of six (6) years after
any Change of Control, it shall cause to be maintained policies of directors'
and officers' liability insurance providing coverage at least comparable to
and in the same amounts as that provided by any such policies in effect
immediately prior to such Change of Control. The Corporation may enter into
contracts with any Director, officer, Delegate or employee of the Corporation
in furtherance of the provisions of this Article V and may create a trust
fund, grant a security interest or use other means (including, without
limitation, a letter of credit) to ensure the payment of such amounts as may
be necessary to effect the advancing of expenses and indemnification as
provided in this Article V.
(C) Contractual nature - The provisions of this Article V as amended
effective December 17, 1990 shall be applicable with respect to events, acts
and omissions occurring prior to or subsequent to such Amendment, and shall
continue as to a person who has ceased to be a Director, officer, Delegate or
employee and shall inure to the benefit of the heirs, executors and
administrators of such person. This Article V shall be deemed to be a
contract between the Corporation and each person who, at any time that this
Article V as so amended is in effect, serves or agrees to serve in any
capacity which entitles him to indemnification hereunder and any repeal or
other modification of this Article V or any repeal or modification of the DGCL
or any other applicable law shall not limit any rights of indemnification for
Proceedings then existing or arising out of events, acts or omissions
occurring prior to such repeal or modification, including, without limitation,
the right to indemnification for Proceedings commenced after such repeal or
modification to enforce this Article V with regard to Proceedings arising out
of acts, omissions or events arising prior to such repeal or modification.
(D) Cooperation - Each Indemnified Person and Additional Indemnified
Person shall cooperate with the person, persons or entity making the
determination with respect to such Indemnified Person's or Additional
Indemnified Person's entitlement to indemnification under this Article V,
including providing to such person, persons or entity upon reasonable advance
request any documentation or information which is not privileged or otherwise
protected from disclosure and which is reasonably available to such
Indemnified Person or Additional Indemnified Person and reasonably necessary
to such determination. Any costs or expenses (including attorneys' fees and
disbursements) incurred by such Indemnified Person or Additional Indemnified
Person in so cooperating with the person, persons or entity making such
determination shall be borne by the Corporation (irrespective of the
determination as to such Indemnified Person's or Additional Indemnified
Person's entitlement to indemnification) and the Corporation hereby
indemnifies and agrees to hold such Indemnified Person or Additional Indemni-
fied Person harmless therefrom.
(E) Subrogation - In the event of any payment under this Article V to an
Indemnified Person or Additional Indemnified Person, the Corporation shall be
subrogated to the extent of such payment to all of the rights of recovery of
such Indemnified Person or Additional Indemnified Person, who shall execute
all papers required and take all action necessary to secure such rights,
including execution of such documents as are necessary to enable the
Corporation to bring suit to enforce such rights.
(F) Severability - If this Article V, or any portion hereof shall be
invalidated or held to be unenforceable on any ground by any court of
competent jurisdiction, the decision of which shall not have been reversed on
appeal, this Article V shall be deemed to be modified to the minimum extent
necessary to avoid a violation of law and, as so modified, this Article V and
the remaining provisions hereof shall remain valid and enforceable in
accordance with their terms to the fullest extent permitted by law.
ARTICLE VI - MISCELLANEOUS
Section 1 - Certificates of Stock - Every holder of stock in the Corporation
shall be entitled to have a certificate signed by or in the name of the
Corporation by the Senior Chairman of the Board or the Chairman of the Board,
Chief Executive Officer or a 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. If such certificate is countersigned (l) by a transfer agent or
(2) by a registrar, any other signature on the certificate may be a facsimile.
In case any officer, transfer agent, or registrar who has signed or whose
facsimile signature has been placed upon a certificate shall have ceased to be
such officer, transfer agent, or registrar before such certificate is issued,
it may be issued by the Corporation with the same effect as if he were such
officer, transfer agent, or registrar at the date of issue.
Section 2 - Lost Certificates - A new certificate of stock may be issued in
the place of any certificate theretofore issued by the Corporation alleged to
have been lost, stolen, or destroyed; and the Directors may, in their
discretion, require the owner of the lost, stolen, or destroyed certificate,
or his legal representative, to give the Corporation a bond in such sum as
they may direct not exceeding double the value of the stock to indemnify the
Corporation against any claim that may be made against it on account of the
alleged loss, theft, or destruction of any such certificate, or the issuance
of any such new certificate.
Section 3 - Transfer of Shares - The shares of stock of the Corporation shall
be transferable upon its books by the holders thereof in person or by their
duly authorized attorneys or legal representatives by the surrender of the old
certificates duly endorsed or accompanied by proper evidence of succession,
assignment, or authority to transfer, to the Corporation by the delivery
thereof to the person in charge of the stock and transfer books and ledgers or
to such other person as the Directors may designate, by whom they shall be
canceled; and new certificates shall thereupon be issued. A record shall be
made of each transfer and a duplicate thereof mailed to the Delaware office;
and whenever a transfer shall be made for collateral security, and not
absolutely, it shall be expressed in the entry of the transfer.
Section 4 - Record Date - In order that the Corporation may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or to express consent to Corporate action in
writing without a meeting or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion, or exchange of stock or for the
purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date which shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors and
which shall not be more than sixty (60) nor less than ten (l0) days before the
date of such meeting nor more than sixty (60) days prior to any other action.
Section 5 - Registered Stockholders - The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends and to vote as such owner and to hold liable
for calls and assessments a person registered on its books as the owner of
shares and shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or
not it shall have express or other notice thereof, except as otherwise
provided by the laws of Delaware.
Section 6 - Dividends - Subject to the provisions of the Certificate of
Incorporation, the Board of Directors may, out of funds legally available
therefor at any regular or special meeting, declare dividends upon the capital
stock of the Corporation as and when they deem expedient. Dividends may be
paid in cash, in property, or in shares of the capital stock of the
Corporation; and in the case of a dividend paid in shares of theretofore
unissued capital stock of the Corporation, the Board of Directors shall, by
resolution, direct that there be designated as capital in respect of such
shares an amount not less than the aggregate par value of such shares and, in
the case of shares without par value, such amount as shall be fixed by the
Board of Directors. Before declaring any dividend, there may be set apart out
of any funds of the Corporation available for dividends, such sum or sums as
the Directors from time to time in their discretion deem proper for working
capital or as a reserve fund to meet contingencies or for such other purposes
as the Directors shall deem conducive to the interests of the Corporation.
Section 7 - Seal - The Corporate seal shall be circular in form and shall
contain the name of the Corporation, the year of its creation, and the words,
``CORPORATE SEAL DELAWARE.'' Said seal may be used by causing it, or a
facsimile thereof, to be impressed or affixed or reproduced or otherwise.
Section 8 - Fiscal Year - The fiscal year of the Corporation shall begin on
the first day of January in each year and shall end on the last day of
December in each year.
Section 9 - Checks - All checks, drafts, or other orders for the payment of
money, notes, or other evidences of indebtedness issued in the name of the
Corporation shall be signed by such officer or officers, agent or agents of
the Corporation and in such manner as shall be determined from time to time by
resolution of the Board of Directors.
Section 10 - Notice and Waiver of Notice - Whenever any notice is required by
these By-Laws to be given, personal notice is not meant unless expressly so
stated. If mailed, notice is given when deposited in the United States mail,
postage prepaid, directed to the stockholder at his address as it appears on
the records of the Corporation. Stockholders not entitled to vote shall not
be entitled to receive notice of any meetings except as otherwise provided by
statute.
Whenever any notice whatever is required to be given under the provisions of
any law or under the provisions of the Certificate of Incorporation of the
Corporation or these By-Laws, a waiver thereof in writing signed by the person
or persons entitled to said notice, whether before or after the time stated
therein, shall be deemed equivalent thereto.
Section 11 - Ratification by Stockholders - Any contract, transaction, or act
of the Corporation or of the Directors or of any committee which shall be
ratified by the holders of a majority of the shares of stock of the
Corporation present in person or by proxy and voting at any annual meeting or
at any special meeting called for such purpose, shall, insofar as permitted by
law or under the provisions of the Certificate of Incorporation of the
Corporation or these By-Laws, be as valid and binding as though ratified by
every stockholder of the Corporation.
Section 12 - Interested Directors - No contract or transaction between the
Corporation and one or more of its Directors or officers 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 solely for
this reason or solely because the Director or officer is present at or
participates in the meeting of the Board of Directors or committee thereof
which authorizes the contract or transaction or solely because his or their
votes are counted for such purpose if:
(1) 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) the material facts as to his relationship or interest and as to the
contract or transaction are disclosed or are known to the
shareholders entitled to vote thereon, and the contract or
transaction is specifically approved in good faith by vote of the
shareholders; or
(3) 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 shareholders.
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.
ARTICLE VII - AMENDMENTS
The By-Laws of this Corporation may be made, altered, amended, or repealed by
the affirmative vote of a majority of the Board of Directors at any regular
meeting of the Board of Directors or at any special meeting of the Board of
Directors if notice of the proposed making, alteration, amendment, or repeal
to be made is contained in the Notice of such special meeting provided,
however, that no By-Law shall be made, altered, amended, or repealed so as to
make such By-Law inconsistent with or violative of any provision of the
Certificate of Incorporation.
As amended through January 21, 1997
EXHIBIT 4(a)
--------------------------------------
SUPPLEMENTAL INDENTURE NO. 2
BETWEEN
McDONALD'S CORPORATION
AND
FIRST UNION NATIONAL BANK
Trustee
-----------------------------
Dated as of January 14, 1997
-----------------------------
SUPPLEMENTAL TO SUBORDINATED DEBT SECURITIES INDENTURE
DATED AS OF OCTOBER 18, 1996
--------------------------------------
<PAGE>
McDONALD'S CORPORATION
SUPPLEMENTAL INDENTURE NO. 2
Dated as of January 14, 1997
Series of 7 1/2% Subordinated Deferrable Interest Debentures due 2037
$150,000,000
Supplemental Indenture No. 2, dated as of January 14, 1997, between
McDONALD'S CORPORATION, a corporation organized and existing under the laws
of the State of Delaware (hereinafter sometimes referred to as the
``Company''), and FIRST UNION NATIONAL BANK, a national banking association,
authorized to accept and execute trusts (hereinafter sometimes referred to as
the ``Trustee''),
W I T N E S S E T H :
WHEREAS, The Company and the Trustee have executed and delivered a
Subordinated Debt Securities Indenture dated as of October 18, 1996 (the
``Indenture'').
WHEREAS, Section 10.01 of the Indenture provides for the Company, when
authorized by the Board of Directors, and the Trustee to enter into an
indenture supplemental to the Indenture to establish the form or terms of any
series of Debt Securities as permitted by Sections 2.01 and 2.02 of the
Indenture.
WHEREAS, Sections 2.01 and 2.02 of the Indenture provide for Debt
Securities of any series to be established pursuant to an indenture
supplemental to the Indenture.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the series
of Debt Securities provided for herein, it is mutually covenanted and agreed,
for the equal and proportionate benefit of all Holders of such series of Debt
Securities, as follows:
ARTICLE ONE
RELATION TO INDENTURE; DEFINITIONS.
SECTION 1.01. This Supplemental Indenture No. 2 constitutes an integral
part of the Indenture.
SECTION 1.02. For all purposes of this Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this
Supplemental Indenture No. 2; and
(3) The terms ``hereof'', ``herein'', ``hereto'', ``hereunder'' and
``herewith'' refer to this Supplemental Indenture.
ARTICLE TWO
THE SERIES OF DEBT SECURITIES.
SECTION 2.01. There shall be a series of Debt Securities designated the
``7 1/2% Subordinated Deferrable Interest Debentures due 2037'' (the
``Debentures''). The Debentures shall be limited to $150,000,000 aggregate
principal amount.
SECTION 2.02. The principal amount of the Debentures shall be payable
on January 2, 2037.
SECTION 2.03. The Debentures will be represented by a global security
(the ``Global Security''). The Global Security will be executed by the
Company, authenticated by the Trustee and deposited with, or on behalf of,
The Depository Trust Company (the ``Depositary'') and registered in the name
of a nominee of the Depositary. Except under circumstances described below,
the Debentures will not be issuable in definitive form.
Ownership of beneficial interests in the Global Security will be limited
to persons that have accounts with the Depositary or its nominee
(``participants'') or persons that may hold interests through participants.
Ownership of a beneficial interest in the Global Security will be shown on,
and the transfer of that beneficial interest will only be effected through,
records maintained by the Depositary or its nominee (with respect to
interests of participants) and on the records of participants (with respect
to interests of persons other than participants).
So long as the Depositary or its nominee is the registered owner of the
Global Security, the Depositary or such nominee, as the case may be, will be
considered the sole owner or Holder of the Debentures represented by the
Global Security for all purposes under the Indenture. Except as provided
below, owners of beneficial interests in the Global Security will not be
entitled to have Debentures represented by the Global Security registered in
their names, will not receive or be entitled to receive physical delivery of
Debentures in definitive form and will not be considered the owners or
Holders thereof under the Indenture.
Principal and interest payments on Debentures represented by the Global
Security registered in the name of the Depositary or its nominee will be made
to the Depositary or its nominee, as the case may be, as the registered owner
of the Global Security.
If the Depositary notifies the Company that it is at any time unwilling
or unable to continue as Depositary or if at any time the Depositary shall no
longer be eligible to continue as Depositary, the Company shall appoint a
successor Depositary with respect to the Debentures. If a successor
Depositary for the Debentures is not appointed by the Company within 90 days
from the date the Company receives such notice or becomes aware of such
ineligibility, the Company will execute, and the Trustee will authenticate
and deliver, Debentures in definitive form in exchange for the entire Global
Security. In addition, the Company may at any time and in its sole
discretion determine not to have the Debentures represented by the Global
Security and, in such event, the Company will execute, and the Trustee will
authenticate and deliver, Debentures in definitive form in exchange for the
entire Global Security. In any such instance, an owner of a beneficial
interest in the Global Security will be entitled to physical delivery in
definitive form of Debentures represented by the Global Security equal in
principal amount to such beneficial interest and to have such Debentures
registered in its name. Debentures so issued in definitive form will be
issued as registered Debentures in denominations of $25 and integral
multiples thereof, unless otherwise specified by the Company.
Upon the exchange of a Global Security for individual Debentures, such
Global Security shall be cancelled by the Trustee. Individual Debentures
issued in exchange for a Global Security shall be registered in such names
and in such authorized denominations as the Depositary for such Global
Security, pursuant to instructions from its direct or indirect participants
or otherwise, shall instruct the Trustee. The Trustee shall deliver such
Debentures to, or in accordance with the instructions of the persons in whose
name such Debentures are so registered.
Unless and until it is exchanged in whole or in part for the individual
Debentures represented thereby, a Global Security representing all or a
portion of the Debentures may not be transferred except as a whole by the
Depositary for the Debentures to a nominee of such Depositary or by a nominee
of such Depositary to such Depositary or another nominee of such Depositary
or by the Depositary or any such nominee to a successor Depositary for the
Debentures or a nominee of such successor Depositary.
SECTION 2.04. The Debentures shall bear interest at the rate of 7 1/2%
per annum, payable quarterly, in arrears, on March 31, June 30, September 30
and December 31 of each year, commencing March 31, 1997, with a final interest
payment on January 2, 2037 (each, an ``Interest Payment Date''). The
Debentures shall be dated the date of authentication and interest shall be
payable on the principal represented thereby from the later of January 14,
1997, or the most recent Interest Payment Date to which interest has been
paid or duly provided for. If any date on which interest is payable is not a
business day, the payment of interest due on such date may be made on the
next succeeding business day (and without any interest or other payment in
respect of such delay).
The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date shall be paid to the Holder in whose name any
Debenture is registered in the Debt Security register at the close of
business on the March 15, June 15, September 15 or December 15 (whether or
not a business day) next preceding such Interest Payment Date (each, a
``Regular Record Date''). Interest payable on redemption or maturity will be
payable to the person to whom the principal is paid.
The Company shall have the right at any time during the term of the
Debentures, prior to an Interest Payment Date, so long as the Company is not
in default in the payment of interest on the Debentures, to extend the
interest payment period for an Extension Period (as defined below). Except
as provided in the next succeeding sentence, no interest shall be due and
payable during an Extension Period, but on the Interest Payment Date
occurring at the end of each Extension Period the Company shall pay to the
Holders of record on the Record Date for such Interest Payment Date
(regardless of who the Holders of record may have been on other dates during
the Extension Period) all interest then accrued but unpaid on the Debentures,
together with interest thereon, compounded quarterly, at the rate of 7 1/2%
per annum, to the extent permitted by law; provided that during any such
Extension Period, the Company shall not declare or pay any dividend on, or
repurchase, redeem or otherwise acquire any of its capital stock, as set
forth in this Section 2.04. Prior to the termination of any Extension
Period, the Company may (a) on any Interest Payment Date pay all or any
portion of the interest accrued on the Debentures as provided herein to
Holders of record on the Regular Record Date for such Interest Payment Date
or (b) from time to time further extend the interest payment period as
provided in the last sentence of this paragraph, provided that any such
Extension Period, together with all such previous and further extensions
thereof, may not exceed 20 consecutive quarterly interest payment periods
from the last date to which interest on the Debentures was paid in full. If
the Company shall elect to pay all of the interest accrued on the Debentures
on an Interest Payment Date during an Extension Period, such Extension Period
shall automatically terminate on such Interest Payment Date. Upon the
termination of any Extension Period and the payment of all amounts of
interest then due, the Company may commence a new Extension Period, subject
to the above requirements. The Company shall cause the Trustee to give prior
notice, by public announcement given in accordance with New York Stock
Exchange rules (or the rules of any other applicable self-regulatory
organization) and by mail, first class postage prepaid, to each Holder of
Debentures at his address as it appears in the Debt Security register, of
(x) the Company's election to initiate an Extension Period and the
duration thereof,
(y) the Company's election to extend any Extension Period beyond the
Interest Payment Date on which such Extension Period is then scheduled to
terminate, and the duration of such extension, and
(z) the Company's election to make a full or partial payment of
interest accrued on the Debentures of any Interest Payment Date during any
Extension Period and the amount of such payment.
In no event shall notice be given less than five Business Days prior to
the March 15, June 15, September 15 or December 15 next preceding the
applicable Interest Payment Date.
The term ``Extension Period'' means the period from and including the
Interest Payment Date next following the date of any notice of extension of
the interest payment period on the Debentures given pursuant to the last
sentence of the preceding paragraph (or, in the case of any further extension
of the interest payment period pursuant to the third sentence of the
preceding paragraph before the payment in full of all accrued but unpaid
interest on the Debentures, the Interest Payment Date to which interest was
paid in full) to but excluding the Interest Payment Date to which payment of
interest on the Debentures is so extended, after giving affect to any further
extensions of the interest payment period on the Debentures pursuant to the
third sentence of the preceding paragraph; provided that no Extension Period
shall exceed 20 consecutive quarterly interest payment periods from the last
date to which interest on the Debentures was paid in full; and provided,
further, that any Extension Period shall end on an Interest Payment Date.
Notwithstanding the foregoing, in no event shall any Extension Period exceed
January 2, 2037.
Any interest on any Debenture which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
``Defaulted Interest'') shall forthwith cease to be payable to the registered
Holder on the relevant Regular Record Date by virtue of having been such
Holder; and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clause (1) and Clause (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Debentures are registered at the close of
business on a Special Record Date (as defined below) for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Debenture and the date of the proposed
payment, and at the same time the Company shall deposit with the Trustee an
amount of money equal to the aggregate amount proposed to be paid in respect
of such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Section provided. Thereupon
the Trustee shall fix a Special Record Date (``Special Record Date'') for the
payment of such Defaulted Interest which shall be not more than 15 nor less
than 10 days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed payment.<PAGE>
The Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefore to be mailed, first class postage prepaid, to each Holder of
Debentures at his address as it appears in the Debt Security register, not
less than 10 days prior to such Special Record Date. The Trustee may, in its
discretion, in the name and at the expense of the Company, cause a similar
notice to be published at least once in an authorized newspaper in each Place
of Payment, but such publication shall not be a condition precedent to the
establishment of such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in
whose names the Debentures are registered on such Special Record Date and
shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Debentures may be listed, and upon such notice as may
be required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Clause, such payment shall
be deemed practicable by the Trustee.
The Company covenants and agrees that, if at any time it has failed to
make any payment of interest or principal on the Debentures when due (after
giving effect to any grace period for payment thereof as provided in Section
6.01 of the Indenture), or the Company exercises its option to extend the
interest payment period as provided for above, the Company will not, until all
Defaulted Interest or accrued but unpaid interest, if the Company exercises
its option to extend the interest payment period on the Debentures and all
principal, if any, then due and payable on the Debentures shall have been paid
in full, (a) declare, set aside, or pay any dividend or distribution on any
capital stock of the Company (except for dividends or distributions in shares
of its capital stock or rights to acquire shares of its capital stock); or (b)
repurchase, redeem, or otherwise acquire any shares of its capital stock
(except: (i) by conversion into or exchange for shares of its capital stock;
or (ii) for a redemption, purchase or other acquisition of shares of its
capital stock made for the purpose of any employee incentive plan or benefit
plan of the Company or any of its affiliates).
Subject to the foregoing provisions of this Section, each Debenture
delivered under this Supplemental Indenture No. 2 upon transfer of or in
exchange for or in lieu of any other Debenture shall carry the rights to
interest accrued but unpaid, and to accrue, which were carried by such other
Debenture.
SECTION 2.05. The Place of Payment for the Debentures shall be both the
City of New York, New York, and the City of Charlotte, North Carolina. The
Trustee shall be the paying agent for the Debentures.
SECTION 2.06. The Debentures may, at the option of the Company, be
redeemed in whole or from time to time in part, upon notice as provided in
Section 3.02 of the Indenture, at any time on or after December 31, 2001, or
at any time upon the occurrence of a Tax Event, at a redemption price equal
to 100% of the principal amount of the Debentures redeemed, together with
accrued but unpaid interest to the date of redemption.
``Tax Event'' means that the Company shall have received an opinion of
independent tax counsel (a ``Tax Opinion'') to the effect that, as a result
of (a) any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or
any political subdivision or taxing authority thereof or therein or (b) any<PAGE>
amendment to or change in an interpretation or application of such laws or
regulations by any legislative body, court, governmental agency or regulatory
authority (including the enactment of any legislation and the publication of
any judicial decision or regulatory determination on or after January 9,
1997), in either case on or after January 9, 1997, there is more than an
insubstantial risk that interest payable on the Debentures would not be
deductible, in whole or in part, by the Company for United States federal
income tax purposes.
SECTION 2.07. The Debentures may be issued in denominations of $25 and
any integral multiples thereof.
SECTION 2.08. The Debentures shall be in the form attached as Exhibit A
hereto.
ARTICLE THREE
MISCELLANEOUS.
SECTION 3.01. The recitals of fact herein and in the Debentures shall
be taken as statements of the Company and shall not be construed as made by
the Trustee.
SECTION 3.02. This Supplemental Indenture No. 2 shall be construed in
connection with and as a part of the Indenture.
SECTION 3.03. (a) If any provision of this Supplemental Indenture No. 2
limits, qualifies, or conflicts with another provision of the Indenture
required to be included in indentures qualified under the Trust Indenture Act
of 1939 (as in effect on the date of this Supplemental Indenture No. 2) by
any of the provisions of Sections 310 to 317, inclusive, of said Trust
Indenture Act, such required provisions shall control.
(b) In case any one or more of the provisions contained in this
Supplemental Indenture No. 2 or in the Debentures issued hereunder should be
invalid, illegal, or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected, impaired, prejudiced or disturbed thereby.
SECTION 3.04. Whenever in this Supplemental Indenture No. 2 either of
the parties hereto is named or referred to, this shall be deemed to include
the successors or assigns of such party, and all the covenants and agreements
in this Supplemental Indenture No. 2 contained by or on behalf of the Company
or by or on behalf of the Trustee shall bind and inure to the benefit of the
respective successors and assigns of such parties, whether so expressed or
not.
SECTION 3.05. (a) This Supplemental Indenture No. 2 may be
simultaneously executed in several counterparts, and all said counterparts
executed and delivered, each as an original, shall constitute but one and the
same instrument.
(b) The descriptive headings of the several Articles of this
Supplemental Indenture No. 2 were formulated, used and inserted in this
Supplemental Indenture No. 2 for convenience only and shall not be deemed to
affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, McDONALD'S CORPORATION has caused this Supplemental
Indenture No. 2 to be signed, acknowledged and delivered by its President,
Executive Vice President and Chief Financial Officer or Senior Vice President
and Treasurer and its corporate seal to be affixed hereunto and the same to
be attested by its Secretary or Assistant Secretary, and FIRST UNION NATIONAL<PAGE>
BANK, as Trustee, has caused this Supplemental Indenture No. 2 to be signed,
acknowledged and delivered by one of its Vice Presidents, and its seal to be
affixed hereunto and the same to be attested by one of its Authorized
Officers, all as of the day and year first written above.
McDONALD'S CORPORATION
[CORPORATE SEAL]
By: /s/ Carleton Day Pearl
------------------------------------
Senior Vice President and Treasurer
Attest:
/s/ Gloria Santona
-------------------------
Secretary
FIRST UNION NATIONAL BANK, as Trustee
[CORPORATE SEAL]
By: /s/ John H. Clapham
----------------------------------
Vice President
Attest:
/s/ Terence C. McPoyle
--------------------------
Authorized Officer
<PAGE>
STATE OF ILLINOIS
SS:
COUNTY OF DuPAGE
On the 14th day of January, in the year one thousand nine hundred ninety
seven, before me appeared Carleton D. Pearl to me personally known, who being
by me duly sworn, did say that he resides at McDonald's Corporation, that he
is Senior Vice President and Treasurer of McDONALD'S CORPORATION, one of the
corporations described in and which executed the above instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument
is such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
/s/ Mary Velazquez
---------------------------------
Notary Public
COMMONWEALTH OF PENNSYLVANIA
SS:
COUNTY OF PHILADELPHIA
On the 14th day of January, in the year one thousand nine hundred ninety
seven, before me appeared John H. Clapham to me personally known, who, being
by me duly sworn, did say that he resides at 1052 Signal Hill, Berwyn, that
he is Vice President of FIRST UNION NATIONAL BANK, one of the corporations
described in and which executed the above instrument; that he knows the seal
of said corporation; that the seal affixed to said instrument is such
corporate seal, that it was so affixed by authority of the Board of Directors
of said corporation, and that he signed his name thereto by like authority.
/s/ Aida B. Dales
----------------------------------
Notary Public
EXHIBIT 4(b)
THIS DEBENTURE IS A REGISTERED GLOBAL DEBENTURE AND IS REGISTERED IN THE
NAME OF CEDE & CO., AS NOMINEE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"). UNLESS THE CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO. HAS
AN INTEREST HEREIN. UNLESS AND UNTIL, IT IS EXCHANGED IN WHOLE OR IN PART
FOR DEBENTURES IN DEFINITIVE REGISTERED FORM, THIS REGISTERED GLOBAL
DEBENTURE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY DTC TO A NOMINEE OF
DTC, OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC, OR BY DTC OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.
REGISTERED McDonalds Corporation REGISTERED
Number 7 1/2% SUBORDINATED DEFERRABLE INTEREST DEBENTURE DUE 2037
RU $150,000,000
SEE REVERSE FOR
CERTAIN DEFINITIONS CUSIP 580 135 887
McDonalds Corporation, a corporation organized and existing under the
laws of the State of Delaware (hereinafter called the ``Company,'' which term
includes any successor corporation under the Indenture hereinafter referred
to), for value received, hereby promises to pay to Cede & Co. or registered
assigns, the principal sum of One Hundred Fifty Million Dollars ($150,000,000)
on January 2, 2037 and to pay interest thereon to the registered Holder hereof
from January 14, 1997, or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, quarterly in arrears on March 31,
June 30, September 30 and December 31 in each year, commencing March 31, 1997,
with a final interest payment on January 2, 2037, at the rate of 7 1/2% per
annum until the principal hereof is paid or such payment is duly provided for.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in said Indenture, be paid to the
Person in whose name this Debenture is registered at the close of business on
the Regular Record Date for such interest, which shall be the March 15, June
15, September 15 or December 15 (whether or not a business day) next preceding
an Interest Payment Date. Interest payable on redemption or maturity will be
payable to the person to whom the principal is paid. Payment of the principal
of and interest on this Debenture will be made at the designated office or
agency of the Company maintained for such purpose in the City of New York, New
York, and the City of Charlotte, North Carolina, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts or, at the option of the Company, interest
so payable may be paid by check to the order of said Holder mailed to said
Holders address appearing on the Debenture register or by wire transfer
payable to an account specified by said Holder. Any interest not so
punctually paid or duly provided for shall be payable as provided in the
Indenture.
Reference is hereby made to the further provisions of this Debenture set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth in this place.
Unless the Certificate of Authentication hereon has been executed by the
Trustee referred to on the reverse hereof (or by an Authenticating Agent, as
provided in the Indenture) by manual signature, this Debenture shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
In Witness Whereof, McDonalds Corporation has caused this Instrument to be
signed in its corporate name by the Chairman of the Board or its President or
one of its Vice Presidents manually or in facsimile and a facsimile of its
corporate seal to be imprinted hereon and attested by the manual or facsimile
signature of its Secretary or one of its Assistant Secretaries.
Dated: January 14, 1997
TRUSTEES CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated herein
provided for in the withinmentioned Indenture.
FIRST UNION NATIONAL BANK
as Trustee
By: /s/ Terence C. McPoyle
--------------------------
Authorized Officer
Attest: /s/ Gloria Santona
---------------------
Secretary
McDONALDS CORPORATION
By: /s/ Carleton Day Pearl
--------------------------
Senior Vice President and Treasurer
<PAGE>
McDONALDS CORPORATION
7 1/2% Subordinated Deferrable Interest Debenture due 2037
Indenture. This Debenture is one of a duly authorized issue of Debt
Securities of the Company designated as its 7 1/2% Subordinated Deferrable
Interest Debentures due 2037 (herein called the "Debentures"), limited in
aggregate principal amount to $150,000,000, issued and to be issued under a
Subordinated Debt Securities Indenture, dated as of October 18, 1996 (herein
called the ``Indenture'') between the Company and First Union National Bank,
as Trustee (herein called the ``Trustee,'' which term includes any successor
trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee, the holders of Senior Indebtedness and the Holders
of the Debentures and of the terms upon which the Debentures are, and are to
be, authenticated and delivered. The Debt Securities may be issued in one or
more series, which different series may be issued in various currencies,
various aggregate principal amounts, may mature at different times, may bear
interest (if any) at different rates, may be subject to different sinking,
purchase or analogous funds (if any), may be subject to different covenants
and Events of Default and may otherwise vary as in the Indenture provided.
Interest. The Company promises to pay interest on said principal sum
from January 14, 1997 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, quarterly in arrears on March
31, June 30, September 30 and December 31 in each year commencing March 31,
1997, with a final interest payment on January 2, 2037, at the rate of 7 1/2%
per annum until maturity or earlier redemption. If any date on which interest
is payable on this Debenture is not a business day, the payment of interest
due on such date may be made on the next succeeding business day (and without
any interest or other payment in respect of such delay). The interest so
payable, and punctually paid or duly provided for, on any Interest Payment
Date (other than interest payable on redemption or maturity) will, as provided
in such Indenture, be paid to the Person in whose name this Debenture (or one
or more predecessor Debt Securities) is registered at the close of business on
the Regular Record Date for such interest, which shall be the March 15, June
15, September 15 or December 15 (whether or not a business day), as the case
may be, next preceding such Interest Payment Date. Interest payable on
redemption or maturity will be payable to the Person to whom the principal is
paid. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Debenture (or one or more
predecessor Debt Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Debentures not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which Debentures may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.<PAGE>
Extension of Interest Payment Period. Notwithstanding anything contained
in the Indenture to the contrary, the Company shall have the right upon prior
notice as provided in the last sentence of this paragraph at any time during
the term of the Debentures prior to an Interest Payment Date, so long as the
Company is not in default in the payment of interest on the Debentures, to
extend the interest payment period for an Extension Period (as defined below).
Except as provided in the next succeeding sentence, no interest shall be due
and payable during an Extension Period, but on the Interest Payment Date
occurring at the end of each Extension Period the Company shall pay to the
Holders of record on the Regular Record Date for such Interest Payment Date
(regardless of who the Holders of record may have been on other dates during
the Extension Period) all interest then accrued but unpaid on the Debentures,
together with interest thereon, compounded quarterly, at the rate of 7 1/2%
per annum, to the extent permitted by law; provided that during any such
Extension Period, the Company shall not declare or pay any dividend on (except
for dividends or distributions in shares of its capital stock or rights to
acquire shares of its capital stock), or repurchase, redeem or otherwise
acquire any of its capital stock (except by conversion into or exchange for
shares of its capital stock or for redemption, purchase or other acquisition
of shares of its capital stock made for the purpose of any employee incentive
plan or benefit plan of the Company or any of its affiliates). Prior to the
termination of any Extension Period, the Company may (a) on any Interest
Payment Date pay all or any portion of the interest accrued on the Debentures
as provided on the face hereof to Holders of record on the Regular Record Date
for such Interest Payment Date or (b) from time to time further extend the
interest payment period as provided in the last sentence of this paragraph,
provided that any such Extension Period, together with all such previous and
further extensions thereof, may not exceed 20 consecutive quarterly interest
payment periods from the last date to which interest on the Debentures was
paid in full. If the Company shall elect to pay all of the interest accrued
on the Debentures on an Interest Payment Date during an Extension Period, such
Extension Period shall automatically terminate on such Interest Payment Date.
Upon the termination of any Extension Period and the payment of all amounts of
interest then due, the Company may commence a new Extension Period, subject to
the above requirements. The Company shall cause the Trustee to give prior
notice, by public announcement given in accordance with New York Stock
Exchange rules (or the rules of any other applicable self-regulatory
organization) and by mail to all such holders, of
(x) the Company's election to initiate an Extension Period and the duration
thereof,
(y) the Company's election to extend any Extension Period beyond the
Interest Payment Date on which such Extension Period is then scheduled to
terminate, and the duration of such extension, and
(z) the Companys election to make a full or partial payment of interest
accrued on the Debentures of any Interest Payment Date during any Extension
Period and the amount of such payment.
In no event shall notice be given less than five Business Days prior to the
March 15, June 15, September 15 or December 15 next preceding the applicable
Interest Payment Date.
The term "Extension Period" means the period from and including the Interest
Payment Date next following the date of any notice of extension of the
interest payment period on the Debentures given pursuant to the last sentence
of the preceding paragraph (or, in the case of any further extension of the
interest payment period pursuant to the third sentence of the preceding
paragraph before the payment in full of all accrued but unpaid interest on the
Debentures, the Interest Payment Date to which interest was paid in full) to
but excluding the Interest Payment Date to which payment of interest on the
Debentures is so extended, after giving affect to any further extensions of
the interest payment period on the Debentures pursuant to the third sentence
of the preceding paragraph; provided that no Extension Period shall exceed 20
consecutive quarterly interest payment periods from the last date to which
interest on the Debentures was paid in full; and provided, further, that any
Extension Period shall end on an Interest Payment Date. Notwithstanding the
foregoing, in no event shall any Extension Period exceed January 2, 2037.
Method of Payment. Payment of the principal of and interest on this
Debenture will be made at the office or agency of the Company in the City of
New York, New York and Charlotte, North Carolina, or at any other office or
agency maintained by the Company for such purpose, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts; provided, however, that at the option of
the Company, payment of interest may be made by check mailed to the address of
the Person entitled thereto as such address shall appear in the Debenture
register or by wire transfer payable to an account specified by such Person.
Paying Agent and Debt Security Registrar. Initially, the Trustee will act
as Debt Security registrar through its office at 123 South Broad Street,
Philadelphia, Pennsylvania 19109, and the Company has appointed the Trustee to
act as Paying Agent through its office or agency in New York, New York, and
Charlotte, North Carolina.
Redemption. The Debentures may be redeemed, at the option of the
Company, in whole or in part (in denominations of $25 or integral multiples
thereof), on any date on or after December 31, 2001, or at any time upon the
occurrence of a Tax Event, upon not less than 30 nor more than 60 days notice
mailed to the registered Holder thereof at a Redemption Price of 100% of the
principal amount, together with accrued but unpaid interest to the Redemption
Date; provided, however, that installments of interest whose Interest Payment
Date is on or prior to the Redemption Date will be payable to the Holders of
such Debentures of record at the close of business on the relevant Regular
Record Dates referred to on the face hereof, all as provided in the Indenture.
The term ``Tax Event'' means that the Company shall have received an
opinion of independent tax counsel (a ``Tax Opinion'') to the effect that, as
a result of (a) any amendment to, or change (including any announced
prospective change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision or taxing authority thereof or therein or
(b) any amendment to or change in an interpretation or application of such
laws or regulations by any legislative body, court, governmental agency or
regulatory authority (including the enactment of any legislation and the
publication of any judicial decision or regulatory determination on or after
January 9, 1997), in either case after January 9, 1997, there is more than an
insubstantial risk that interest payable on the Debentures would not be
deductible, in whole or in part, by the Company for United States federal
income tax purposes.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures for the unredeemed portion thereof will be issued in
the name of the Holder thereof upon the cancellation hereof.
Subordination. The Company and each Holder, by acceptance hereof, agree
that the payment of the principal of and interest on the Debentures is
subordinated, to the extent and in the manner provided in the Indenture, to
the prior payment in full of all Senior Indebtedness, and this Debenture is
issued subject to the provisions of the Indenture with respect thereto. Each
Holder of this Debenture, by accepting the same, authorizes and expressly
directs the Trustee on his behalf to take such action as may be necessary or
appropriate in the discretion of the Trustee to effectuate the subordination
so provided and appoints the Trustee his attorney-in-fact for such purpose.
Indebtedness. The Company and, by its acceptance of this Debenture or a
beneficial interest herein, the Holder of, and any Person that acquires a
beneficial interest in, this Debenture agree that for United States federal,
state and local tax purposes it is intended that this Debenture constitute
indebtedness.
Defaults and Remedies. If an Event of Default shall occur and be
continuing, the principal of all the Debentures may be declared due and
payable in the manner and with the effect provided in the Indenture.
Amendments and Waivers. The Indenture contains provisions permitting the
Company and the Trustee, with the consent of the Holders of not less than
66-2/3% in aggregate principal amount of each series of Debt Securities at the
time outstanding (as defined in the Indenture) to be affected (each series
voting as a class), evidenced as in the Indenture provided, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental<PAGE>
indenture or modifying in any manner the rights of the Holders of the Debt
Securities of all such series; provided, however, that no such supplemental
indenture shall, among other things, (i) extend the fixed maturity of any Debt
Security, or reduce the rate or extend the time of payment of interest
thereon, or reduce the principal amount or premium, if any, thereon or make
the principal thereof, or premium, if any, or interest, if any, thereon
payable in any coin or currency other than that hereinabove provided, without
the consent of the Holder of each Debt Security so affected or reduce the
amount of principal of an Original Issue Discount Security that would be due
and payable upon acceleration of maturity thereof, or (ii) reduce the
aforesaid percentage of Debt Securities the Holders of which are required to
consent to any such supplemental indenture, without the consent of the Holders
of each Debt Security so affected. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal amount of the
Debentures at the time Outstanding, as defined in the Indenture, on behalf of
the Holders of all the Debentures, to waive compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Debenture shall be conclusive and binding upon such Holder and upon all
future Holders of this Debenture and of any Debenture issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of
such consent or waiver is made upon this Debenture or upon any Debenture
issued upon the transfer hereof or in exchange therefor or in lieu hereof.
Obligation Absolute. No reference herein to the Indenture and no
provision of this Debenture or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of and interest on this Debenture at the times, place and rate, and
in the coin or currency, herein prescribed.
Denominations. The Debentures are issuable only in registered form
without coupons in denominations of $25 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set
forth, Debentures are exchangeable for a like aggregate principal amount of
Debentures of a different authorized denomination, as requested by the Holder
surrendering the same and upon surrender of the Debenture for registration of
transfer at the office or agency of the Company in New York, New York, or
Charlotte, North Carolina, the Company will execute, and the Trustee will
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Debentures, of authorized denominations and of a
like aggregate principal amount and tenor. Every Debenture surrendered for
registration of transfer or exchange will, if required by the Company, the
Debt Security registrar or the Trustee, be duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company, the Debt
Security registrar and the Trustee duly executed by, the Holder hereof or his
attorney duly authorized in writing. No service charge shall be made for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Persons Deemed Owners. Prior to due presentment of this Debenture for
registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name this Debenture is
registered in the Debt Security register as the owner hereof for all purposes,
whether or not this Debenture is overdue, and neither the Company, the Trustee
nor any such agent shall be affected by notice to the contrary.
No Recourse Against Others. No recourse for the payment of the principal
of or interest on this Debenture, or for any claim based hereon or on the
Indenture and no recourse under or upon any obligation, covenant or agreement
of the Company in the Indenture or any indenture supplemental thereto or in
any Debenture, or because of the creation of any indebtedness represented
hereby, shall be had against any incorporator, stockholder, officer or
director, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or
by the enforcement of any assessment or penalty or otherwise, all such<PAGE>
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.
Governing Law. This Debenture will be governed by and construed and
enforced in accordance with, the internal laws of the State of Illinois.
Terms. All terms used in this Debenture which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
The following abbreviations, when used in the inscription on the face of
this Debenture, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
UNIF GIFT MIN ACT - Custodian
----------------- -----------------
(Cust) (Minor)
under Uniform Gifts to Minors
Act
----------------
(State)
Additional abbreviations may also be used though not in the above list.
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FOR VALUE RECEIVED the undersigned hereby sell(s),
assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
----------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
----------------------------------------------------------------------------
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the within Instrument of McDONALD'S CORPORATION and hereby does irrevocably
constitute and appoint
------------------------------------------------------------------- Attorney
to transfer the said Instrument on the books of the within-named Company, with
full power of substitution in the premises.
Dated:
---------------------------- ----------------------------
NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Instrument in every particular,
without alteration or enlargement or any change whatever.
EXHIBIT 8
January 14, 1997
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Goldman, Sachs & Co.
J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Paine Webber Incorporated
Prudential Securities Incorporated
Salomon Brothers Inc
Smith Barney Inc.
As Representatives of the Several Underwriters
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower
New York, NY 10281
Re: McDonald's Corporation
7 1/2% Subordinated Deferrable Interest
Debentures Due 2037
Ladies and Gentlemen:
You have requested my opinion relating to certain material United States
federal income tax considerations relevant to certain persons who purchase
McDonald's Corporation 7 1/2% Subordinated Deferrable Interest Debentures Due
2037 (the ``Debentures'') upon their original issuance and who hold such
Debentures as capital assets (an ``Original Holder'').
Based upon the representations of the McDonald's Corporation financial
management, certain facts set forth in the Prospectus Supplement dated January
9, 1997 (the ``Prospectus Supplement''), the contents of other documents
related to the issuance of the Debentures and subject to the foregoing, the
statements set forth in the Prospectus Supplement under the heading " Certain
United States Federal Income Tax Considerations," insofar as they relate to
matters of law or legal conclusions with respect to the Federal law of the
United States, accurately reflect, constitute and are consistent with my legal
opinion with respect to the material United States federal income tax
considerations applicable to an Original Holder and as such are correct in all
material respects and are a fair and accurate summary of the material United
States federal income tax considerations concerning an investment by an
Original Holder in the Debentures.
My opinion is based on the Internal Revenue Code of 1986, as amended, Treasury
regulations thereunder and administrative and judicial interpretations
thereof, all as in effect on the date of this opinion, and all of which are
subject to change, possibly on a retroactive basis, or different
interpretations. It does not discuss all of the United States federal income
tax considerations that may be relevant to each Original Holder in light of
such holder's particular facts and circumstances and such opinion is not
intended to be applicable in all respects to all categories of investors. In
particular, my opinion does not address special classes of holders such as
banks, thrifts, real estate investment trusts, regulated investment companies,
insurance companies, dealers in securities or currencies, tax-exempt
investors, persons that have a functional currency other than the U.S. Dollar
or persons who hold the Debentures as part of an integrated transaction
(including a ``straddle'') consisting of the Debentures and one or more other
positions or as other than a capital asset. In addition, my opinion does not<PAGE>
address any state, local or foreign tax consequences to an Original Holder.
As indicated in the Prospectus Supplement, all holders of the Debentures
should consult their own tax advisors concerning the United States federal,
state, local and foreign tax consequences of the purchase, ownership and
disposition of the Debentures in light of their own particular circumstances.
I am furnishing this opinion to you solely for the purpose of providing an
opinion that may be used, circulated, quoted or otherwise referred to by you
only as part of the filing of the above-referenced Prospectus Supplement with
the United States Securities and Exchange Commission, and my opinion is not to
be relied upon or used for any other purpose without my prior written consent.
I am aware that I am named in the Prospectus Supplement as Federal Tax Counsel
to McDonald's Corporation and hereby consent to such use of my name and the
filing of this opinion with the Securities and Exchange Commission. By giving
such consent, I do not admit that I am an "expert" within the meaning of the
Securities Act of 1933 or the rules and regulations of the Commission issued
thereunder with respect to any part of the Prospectus Supplement.
This opinion is rendered on the date hereof and I have no continuing
obligation hereunder to inform you of any changes of law subsequent to the
date hereof.
Very truly yours,
/s/ Paul J. Schaffhausen
--------------------------
Paul J. Schaffhausen
Assistant Vice President,
Federal Tax Counsel
McDonald's Corporation
