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EXHIBIT 99.1
RESTATED ARTICLES OF ORGANIZATION
Federal Identification
Number: 06-1047163
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THE COMMONWEALTH OF MASSACHUSETTS
William Francis Galvin
Secretary of the Commonwealth
One Ashburton Place, Boston, Massachusetts 02108-1512
RESTATED ARTICLES OF ORGANIZATION
(GENERAL LAWS, CHAPTER 156B, SECTION 74)
We, MICHAEL S. WYZGA, *Senior Vice-President and PETER WIRTH, *Clerk of
Genzyme Corporation located at One Kendall Square, Cambridge, MA 02139
do hereby certify that the following Restatement of the Articles of
Organization was duly adopted at a meeting held on March 5, 2000 and
May 25, 2000 and December 18, 2000 by a vote of the directors/or:
59,927,251 votes of all series of Genzyme common stock of 99,103,359
votes outstanding,
9,007,794 shares of Genzyme Surgical Products Division Common
Stock of 14,998,985 shares outstanding, and
16,175,534 shares of Genzyme Tissue Repair Division Common Stock
of 28,868,052 shares outstanding,
**being at least a majority of each type, class or series outstanding
and entitled to vote thereon and of each type, class or series of stock
whose rights are adversely affected thereby:
ARTICLE I
The name of the corporation is:
GENZYME CORPORATION
ARTICLE II
The purpose of the corporation is to engage in the following business
activities:
TO DEVELOP, MANUFACTURE AND SELL HUMAN HEALTH CARE PRODUCTS AND TO
ENGAGE GENERALLY IN ANY BUSINESS THAT MAY LAWFULLY BE CARRIED ON BY A
CORPORATION FORMED UNDER CHAPTER 156B OF THE GENERAL LAWS OF
MASSACHUSETTS.
*Delete the inapplicable words. **Delete the inapplicable clause.
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ARTICLE III
State the total number of shares and par value, if any, of each class
of stock which the corporation is authorized to issue:
<TABLE>
<CAPTION>
<S><C>
WITHOUT PAR VALUE WITH PAR VALUE
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TYPE NUMBER OF SHARES TYPE NUMBER OF PAR VALUE
SHARES
------
Common: COMMON: 390,000,000* $.01
------- ------------ ----
Preferred: PREFERRED: 10,000,000*** $.01
---------- ------------- ----
</TABLE>
* of which 200,000,000 shares have been designated Genzyme General
Division Common Stock, 40,000,000 shares have been designated Genzyme
Molecular Oncology Division Common Stock and 100,000,000 share have
been designated Genzyme Biosurgery Division Common Stock.
*** of which 2,000,000 shares have been designated Series A Junior
Participating Preferred Stock, 1,000,000 shares have been designated
Series B Junior Participating Preferred Stock, and 400,000 shares
have been designated Series C Junior Participating Preferred Stock.
ARTICLE IV
If more than one class of stock is authorized, state a distinguishing
designation for each class. Prior to the issuance of any shares of a
class, if shares of another class are outstanding, the corporation must
provide a description of the preferences, voting powers,
qualifications, and special or relative rights or privileges of that
class and of each other class of which shares are outstanding and of
each series then established within any class.
2
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DESCRIPTION OF CAPITAL STOCK
A. AUTHORIZED CAPITAL STOCK
The total number of shares of all classes of capital stock which the
Corporation shall be authorized to issue is four hundred million (400,000,000)
shares, consisting of three hundred ninety million (390,000,000) shares of
Common Stock, $.01 par value per share (the "Common Stock") and ten million
(10,000,000) shares of Preferred Stock, $.01 par value per share (the "Preferred
Stock").
B. UNDESIGNATED COMMON STOCK
Shares of Common Stock not at the time designated as shares of a
particular series pursuant to this Section IV.B. or any other provision of these
Articles of Organization may be issued from time to time in one or more
additional series. The Board of Directors may determine, in whole or in part,
the preferences, voting powers, qualifications and special or relative rights or
privileges of any such series before the issuance of any shares of that series,
PROVIDED that in no event shall the holder of a share of any series of Common
Stock be entitled to more than one vote per share at the time that shares of
such series are first issued. The Board of Directors shall determine the number
of shares constituting each series of Common Stock and each series shall have a
distinguishing designation.
C. GENZYME GENERAL DIVISION COMMON STOCK
1. Authorized Amounts. Two hundred million (200,000,000)
shares of Common Stock are designated as a series of Common Stock with the
following designation: Genzyme General Division Common Stock (the "GGD Stock").
To the extent legally permitted, such number of shares may be increased or
decreased by vote of the Board of Directors, provided that no decrease shall
reduce the number of shares of GGD Stock to a number less than the number of
shares of such series then outstanding plus the number of shares of such series
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 such series of Common Stock. A description of the
GGD Stock and a statement of its preferences, voting powers, qualifications and
special or relative rights or privileges is as follows:
2. Dividends And Distributions. Subject to the express terms
of any outstanding series of Preferred Stock, dividends may be declared and paid
upon the GGD Stock, in such amounts and at such times as the Board of Directors
may determine, only out of the lesser of (a) funds of the Corporation legally
available therefor and (b) the Available GGD Dividend Amount.
3. Voting Rights. The holders of GGD Stock, voting together
with the holders of shares of all other series of Common Stock as a single class
of stock, shall have the exclusive right to vote for the election of directors
and on all other matters requiring action by the stockholders or submitted to
the stockholders for action, except as may be determined by the
Continuation Sheet - 4
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Board of Directors in establishing any series of Common or Preferred Stock or as
may otherwise be required by law. Each share of the GGD Stock shall entitle the
holder thereof to one vote.
4. Liquidation, Dissolution Or Winding Up. Upon any voluntary
or involuntary liquidation, dissolution or winding up of the Corporation, the
rights of the holders of GGD Stock shall be as follows:
(a) After the Corporation has satisfied or made
provision for its debts and obligations and for the payment to the holders of
shares of any class or series of capital stock having preferential rights to
receive distributions of the net assets of the Corporation (including any
accumulated and unpaid dividends), the holders of GGD Stock shall be entitled to
receive the net assets of the Corporation remaining for distribution, on a per
share basis in proportion to the respective liquidation units per share of all
series of Common Stock. Each share of GGD Stock shall have one hundred (100)
liquidation units.
(b) For the purposes of Section IV.C.4(a), any merger
or business combination involving the Corporation or any sale of all or
substantially all of the assets of the Corporation shall not be treated as a
liquidation.
5. Special Voting Rights. The Corporation shall not, without
approval by the holders of the GGD Stock at a meeting at which a quorum is
present and the votes cast in favor of the proposal exceed those cast against:
(a) allow any proceeds from the Disposition of the
properties or assets allocated to Genzyme General Division to be used in the
business of any other Division without fair compensation being allocated to
Genzyme General Division as determined by the Board of Directors;
(b) allow any properties or assets allocated to
Genzyme General Division to be used in the business of any other Division or for
the declaration or payment of any dividend or distribution on any series of
Common Stock other than the GGD Stock without fair compensation being allocated
to Genzyme General Division as determined by the Board of Directors;
(c) issue, sell or otherwise distribute shares of GGD
Stock without allocating the proceeds or other benefits of such issuance, sale
or distribution to Genzyme General Division;
(d) change the rights or preferences of the GGD Stock
so as to affect the GGD Stock adversely; or
(e) effect any merger or business combination
involving the Corporation as a result of which (a) the holders of all series of
Common Stock of the Corporation shall no longer own, directly or indirectly, at
least fifty percent (50%) of the voting power of the surviving corporation and
(b) the holders of all series of Common Stock of the Corporation do not receive
the same form of consideration, distributed among such holders in proportion to
the Market Capitalization of each series of Common Stock as of the date of the
first public announcement of such merger or business combination.
Continuation Sheet - 5
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6. Definitions. As used in this Section IV.C., the following
terms shall have the following meanings (with terms defined in the singular
having comparable meaning when used in the plural and vice versa), unless
another definition is provided or the context otherwise requires:
(a) "Available GGD Dividend Amount," on any date,
shall mean the greater of:
(1) the excess of
(A) the greater of (x) the fair
value on such date of the net assets of Genzyme General Division and (y) an
amount equal to $335,378,000 (stockholders' equity allocated to Genzyme General
Division at June 30, 1994), such dollar amount to be increased or decreased, as
appropriate, to reflect, after June 30, 1994, (A) the Earnings Attributable to
Genzyme General Division, (B) any dividends or other distributions (including by
reclassification or exchange) declared or paid with respect to, or repurchases
or issuances of, any shares of GGD Stock or any other class of capital stock
attributed to Genzyme General Division, but excluding dividends or other
distributions paid in shares of GGD Stock to the holders thereof or in shares of
any other class of capital stock attributed to Genzyme General Division to the
holders thereof, and (C) any other adjustments to the stockholders' equity of
Genzyme General Division made in accordance with generally accepted accounting
principles, over
(B) the sum of (x) the aggregate par
value of all outstanding shares of GGD Stock and any other class of capital
stock attributed to Genzyme General Division and (y) unless these Articles of
Organization permit otherwise, the aggregate amount that would be needed to
satisfy any preferential rights to which holders of all outstanding Preferred
Stock attributed to Genzyme General Division are entitled upon dissolution of
the Corporation in excess of the aggregate par value of such Preferred Stock,
provided that such excess shall be reduced by any amount necessary to enable
Genzyme General Division to pay its debts as they become due, and
(2) the amount legally available for the
payment of dividends determined in accordance with Massachusetts law applied as
if Genzyme General Division were a separate corporation.
(b) "Earnings Attributable" to Genzyme General
Division for any period, shall mean the net income or loss of Genzyme General
Division for such period (or for the fiscal periods of the Corporation
commencing prior to the GTR Effective Date and after June 30, 1994, pro forma
net income or loss of Genzyme General Division as if the GTR Effective Date were
June 30, 1994) determined in accordance with generally accepted accounting
principles, with all income and expenses of the Corporation being allocated
between Divisions in a reasonable and consistent manner in accordance with
policies adopted by the Board of Directors; provided, however, that as of the
end of any fiscal quarter of the Corporation, any projected annual tax benefit
attributable to any Division that cannot be utilized by such Division to offset
or reduce its allocated tax liability may be allocated to any other Division
without any compensating payment or allocation.
Continuation Sheet - 6
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(c) "Genzyme General Division" shall mean, at any
time, the Corporation's interest in (i) all of the businesses, products, or
development or research programs in which the Corporation or any of its
subsidiaries (or any of their predecessors or successors) is or has been
engaged, directly or indirectly, other than those allocated to any division of
the Corporation represented by a series of Common Stock (any "Division") other
than the GGD Stock; and (ii) all assets and liabilities of the Corporation to
the extent allocated to any such businesses, products, or development or
research programs in accordance with generally accepted accounting principles
consistently applied for all of the Corporation's business units. From and after
the date on which all of the outstanding shares of any series of Common Stock
are exchanged for shares of GGD Stock, other securities, cash, other property or
a combination thereof, all of the businesses, products, development or research
programs, assets and liabilities of the Division represented by such series of
Common Stock shall be included in Genzyme General Division. Genzyme General
Division shall be represented by the GGD Stock.
D. GENZYME MOLECULAR ONCOLOGY COMMON STOCK
1. Authorized Amounts And Designations. Forty million
(40,000,000) shares of Common Stock are designated as a series of Common Stock
with the following designation: Genzyme Molecular Oncology Division Common Stock
(the "GMO Stock"). To the extent legally permitted, such number of shares may be
increased or decreased by vote of the Board of Directors, provided that no
decrease shall reduce the number of shares of GMO Stock to a number less than
the number of shares of such series then outstanding plus the number of shares
of such series 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 such series of Common Stock.
2. Dividends And Distributions. Subject to the express terms
of any outstanding series of Preferred Stock, dividends may be declared and paid
upon the GMO Stock, in such amounts and at such times as the Board of Directors
may determine, only out of the lesser of (a) funds of the Corporation legally
available therefor and (b) the Available GMO Dividend Amount.
3. Voting Rights. The holders of GMO Stock, voting together
with the holders of shares of all other series of Common Stock as a single class
of stock, shall have the exclusive right to vote for the election of directors
and on all other matters requiring action by the stockholders or submitted to
the stockholders for action, except as may be determined by the Board of
Directors in establishing any series of Common or Preferred Stock or as may
otherwise be required by law. Each share of GMO Stock shall entitle the holder
thereof to .08 vote through December 31, 2000. On January 1, 2001 and on each
January 1 every two years thereafter, the number of votes to which the holder of
each share of GMO Stock shall be entitled shall be adjusted and fixed for
two-year periods to equal the quotient (expressed as a decimal and rounded to
the nearest two decimal places) obtained by dividing (i) the Fair Market Value
of one share of GMO Stock by (ii) Fair Market Value of one share of GGD Stock as
of such date. If no shares of GGD Stock are outstanding on such date, then all
other series of voting Common Stock outstanding on such date shall have a number
of votes such that each share of the series of outstanding Common Stock that has
the highest Fair Market Value per share on such date (the "Base Series") shall
have one vote and each share of each other series of outstanding Common
Continuation Sheet - 7
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Stock shall have the number of votes determined according to the immediately
preceding sentence, treating, for such purpose, the Base Series as the GGD Stock
in such sentence. If shares of GMO Stock are entitled to vote separately as a
class, each share of GMO Stock shall have one vote.
4. Liquidation, Dissolution Or Winding Up. Upon any voluntary
or involuntary liquidation, dissolution or winding up of the Corporation, the
rights of the holders of GMO Stock shall be as follows:
(a) After the Corporation has satisfied or made
provision for its debts and obligations and for the payment to the holders of
shares of any class or series of capital stock having preferential rights to
receive distributions of the net assets of the Corporation (including any
accumulated and unpaid dividends), the holders of GMO Stock shall be entitled to
receive the net assets of the Corporation remaining for distribution, on a per
share basis in proportion to the respective liquidation units per share of all
series of Common Stock. Each share of GMO Stock shall, subject to Section
IV.F.4., have 25 liquidation units.
(b) For the purposes of Section IV.D.4(a) any merger
or business combination involving the Corporation or any sale of all or
substantially all of the assets of the Corporation shall not be treated as a
liquidation.
5. Special Voting Rights. The Corporation shall not, without
approval by the holders of the GMO Stock at a meeting at which a quorum is
present and the votes cast in favor of the proposal exceed those cast against:
(a) allow any proceeds from the Disposition of the
properties or assets allocated to Genzyme Molecular Oncology Division to be used
in the business of any other Division without fair compensation being allocated
to Genzyme Molecular Oncology Division as determined by the Board of Directors;
(b) allow any properties or assets allocated to
Genzyme Molecular Oncology Division to be used in the business of any other
Division or for the declaration or payment of any dividend or distribution on
any series of Common Stock other than the GMO Stock without fair compensation
being allocated to Genzyme Molecular Oncology Division as determined by the
Board of Directors;
(c) issue, sell or otherwise distribute shares of GMO
Stock without allocating the proceeds or other benefits of such issuance, sale
or distribution to Genzyme Molecular Oncology Division; provided, however, that
the Corporation may without such approval issue GMO Designated Shares;
(d) change the rights or preferences of the GMO Stock
so as to affect the GMO Stock adversely; or
(e) effect any merger or business combination
involving the Corporation as a result of which (i) the holders of all series of
Common Stock of the Corporation shall no longer own, directly or indirectly, at
least fifty percent (50%) of the voting power of the surviving corporation and
(ii) the holders of all series of Common Stock of the Corporation do
Continuation Sheet - 8
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not receive the same form of consideration, distributed among such holders in
proportion to the Market Capitalization of each series of Common Stock as of the
date of the first public announcement of such merger or business combination.
Notwithstanding the foregoing, if the Corporation receives an opinion
of Qualified Tax Counsel that, by reason of any Tax Law Change, the special
voting rights of the GMO Stock set forth in this subsection 5 would cause a Tax
Event absent the termination of such rights, then the Corporation may, by vote
of a majority of the stock outstanding and entitled to vote thereon, voting
together as a single class, authorize an amendment to these Articles of
Organization to effect the termination of such rights in order to avoid the
occurrence of such Tax Event. Any such amendment shall not be deemed to change
the rights or preferences of the GMO Stock so as to affect the GMO Stock
adversely as contemplated by either Section IV.D.5(d) or Section 77 of the
Massachusetts Business Corporation Law.
6. Exchange or Redemption of GMO Stock. Shares of GMO Stock
are subject to exchange or redemption upon the terms and conditions set forth
below:
(a) Optional Exchange of GMO Stock.
(1) The Board of Directors may at any time,
including without limitation in the event of the reallocation, in one
transaction or a series of related transactions, by the Corporation and/or its
subsidiaries of all or substantially all of the properties and assets allocated
to Genzyme Molecular Oncology Division to any other Division of Genzyme, declare
that each of the outstanding shares of GMO Stock shall be exchanged, on an
Exchange Date, as determined by the Board of Directors, for (a) a number of
fully paid and nonassessable shares of GGD Stock (calculated to the nearest five
decimal places) equal to (1) 130% of the Fair Market Value of one share of the
GMO Stock (the "GMO Optional Exchange Amount") as of the date of the first
public announcement by the Corporation (the "GMO Optional Exchange Announcement
Date") of such exchange divided by (2) the Fair Market Value of one share of GGD
Stock as of such GMO Optional Exchange Announcement Date or (b) cash equal to
the GMO Optional Exchange Amount, or (c) any combination of GGD Stock and cash
equal to the GMO Optional Exchange Amount as determined by the Board of
Directors.
(2) If the Corporation receives an opinion
of Qualified Tax Counsel that a Tax Event has occurred by reason of any Tax Law
Change, then the Board of Directors may at any time declare that each of the
outstanding shares of GMO Stock shall be exchanged, on an Exchange Date, as
determined by the Board of Directors, for a number of fully paid and
nonassessable shares of GGD Stock (calculated to the nearest five decimal
places) equal to (1) the Fair Market Value of one share of the GMO Stock as of
the date of the first public announcement by the Corporation of such exchange
divided by (2) the Fair Market Value of one share of GGD Stock as of such date.
(3) At any time at which all of the assets
and liabilities attributed to Genzyme Molecular Oncology Division (and no other
assets or liabilities of the Corporation or any subsidiary thereof) are held
directly or indirectly by one or more wholly-owned subsidiaries of the
Corporation (each, a "GMO Subsidiary"), the Board of Directors may, provided
that there are funds of the Corporation legally available therefor, exchange on
an
Continuation Sheet - 9
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Exchange Date, as determined by the Board of Directors, all of the outstanding
shares of GMO Stock for that number of the shares of common stock of each GMO
Subsidiary equal to the number of such GMO Subsidiary shares outstanding
immediately prior to such exchange multiplied by the GMO Allocation Ratio, such
shares of common stock of each GMO Subsidiary to be delivered to the holders of
shares of GMO Stock on the Exchange Date either directly or indirectly through
the delivery of shares of another GMO Subsidiary that owns directly or
indirectly all such shares, and to be divided among the holders of GMO Stock on
a pro rata basis in accordance with the number of shares of GMO Stock held by
each such holder, each of which shares of common stock of such GMO Subsidiary
shall be, upon such delivery, fully paid and nonassessable; provided, however,
that upon any such exchange, any existing GMO Designated Shares shall be
cancelled in exchange for the allocation to Genzyme General of the direct or
indirect interest of the Corporation in any remaining outstanding shares of each
such GMO Subsidiary that are not transferred to the holders of GMO Stock in such
exchange.
(b) Mandatory Exchange or Redemption of or Payment of
Dividend on GMO Stock.
(1) GMO Mandatory Payment. In the event of
the Disposition, in one transaction or a series of related transactions, by the
Corporation and/or its subsidiaries of all or substantially all of the
properties and assets allocated to Genzyme Molecular Oncology Division to any
person, entity or group (other than a Disposition of a type set forth in
subsection (2) of this subsection (b)), on or prior to the 60th Business Day, or
such earlier date required under this Section IV.D.6, following the date of the
GMO Mandatory Payment Announcement (as defined in Section IV.D.6(d)(2)), the
Corporation shall select one of the following alternatives, as determined by the
Board of Directors in its discretion:
(A) provided that there are funds of
the Corporation legally available therefor, pay to the holders of the shares of
GMO Stock a dividend on a pro rata basis in accordance with the number of shares
of GMO Stock held by each such holder in cash, securities (other than shares of
a series of Common Stock) and/or other property having a Fair Market Value as of
the date of the Disposition in the aggregate equal to the Fair Market Value as
of the date of the Disposition of the GMO Net Proceeds of such Disposition; or
(B) provided that there are funds of
the Corporation legally available therefor,
(1) if such Disposition
involves all (not merely substantially all) of the properties and assets
attributed to Genzyme Molecular Oncology Division, redeem or exchange as of a
Redemption Date determined by the Board of Directors, all outstanding shares of
GMO Stock in exchange for, on a pro rata basis, cash, securities (other than
shares of a series of Common Stock) and/or other property having a Fair Market
Value as of the date of the Disposition in the aggregate equal to the Fair
Market Value as of the date of the Disposition of the GMO Net Proceeds of such
Disposition; or
(2) if such Disposition
involves substantially all (but not all) of the properties and assets attributed
to Genzyme Molecular Oncology Division, redeem or exchange as of a Redemption
Date as determined by the Board of Directors such
Continuation Sheet - 10
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number of whole shares of GMO Stock (which may be all, but not more than all, of
such shares outstanding) as have in the aggregate an average Closing Price
during the period of ten (10) consecutive Business Days beginning on the first
Business Day immediately following the date of the Estimated GMO Net Proceeds
Announcement (as defined in Section IV.D.6(d)(2)) closest to the Fair Market
Value as of the date of the Disposition of the GMO Net Proceeds of such
Disposition in consideration for, on a pro rata basis, cash securities (other
than shares of a series of Common Stock) and/or other property having a Fair
Market Value as of the date of the Disposition in the aggregate equal to such
Fair Market Value of the GMO Net Proceeds; or
(C) declare that each outstanding
share of GMO Stock shall be exchanged as of an Exchange Date as determined by
the Board of Directors into a number of fully paid and nonassessable shares of
GGD Stock equal to 110% of the ratio (calculated to the nearest five decimal
places) of the average Closing Price of one share of GMO Stock over the period
of ten (10) consecutive Business Days beginning on the first Business Day
immediately following the date of the Estimated GMO Net Proceeds Announcement
(as defined in Section IV.D.6(d)(2)) to the average Closing Price of one share
of GGD Stock over the same ten Business Day period.
Any redemption or exchange of or dividend payment on GMO Stock made pursuant to
this Section IV.D.6(b)(1) or Section IV.D.6(c)(3) is hereinafter referred to as
a "GMO Mandatory Payment." Notwithstanding the foregoing provisions of this
Section IV.D.6.(b), the Corporation shall redeem GMO Stock as provided by
Section IV.D.(b)(1)(B) only if the amount to be paid pursuant to such redemption
is less than or equal to the Available GMO Dividend Amount as of the Redemption
Date.
(2) Exceptions to Mandatory Payment.
Notwithstanding the foregoing Section IV.D.6(b)(1) or Section IV.D.6(c)(3), a
GMO Mandatory Payment shall not be required by the occurrence of a Disposition:
(A) by the Corporation of all or
substantially all of the Corporation's properties and assets in one transaction
or a series of related transactions, including such Disposition in connection
with the dissolution, liquidation or winding up of the Corporation and the
distribution of assets to stockholders as referred to in Section IV.D.4;
(B) of the properties and assets
attributed to Genzyme Molecular Oncology Division as contemplated by Section
IV.D.6(a)(3) or otherwise to all holders of GMO Stock divided among such holders
on a pro rata basis in accordance with the number of shares GMO Stock
outstanding;
(C) to any person or entity
controlled (as determined by the Board of Directors) by the Corporation;
(D) in connection with a Related
Business Transaction in respect of Genzyme Molecular Oncology Division; or
(E) that is conditioned upon the
affirmative vote of the holders of GMO Stock, voting as a separate class.
Continuation Sheet - 11
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(c) Termination of Cash Exchange Right. If the
Corporation receives an opinion of Qualified Tax Counsel that, by reason of any
Tax Law Change, the right or obligation of the Corporation to exchange GMO Stock
for cash, securities or other property pursuant to Section IV.D.6(a)(1) or (3)
or IV.D.6(b) (each, a "GMO Cash Exchange Right") would cause a Tax Event if not
terminated, then the Board of Directors may at any time, by a vote of a majority
of the directors then in office, elect to terminate any or all such GMO Cash
Exchange Rights, with the result that the Corporation shall thereafter have,
depending on which GMO Cash Exchange Right(s) is (are) so terminated:
(1) under Section IV.D.6(a)(1) only the
right to cause the exchange of GMO Stock for GGD Stock and not for cash,
securities or other property other than capital stock of the Corporation,
(2) no right to effect an exchange under
Section IV.D.6(a)(3), and/or
(3) no right or obligation to effect a GMO
Mandatory Payment under Section IV.D.6(b), provided that if the Board shall no
longer have the right or obligation to effect a GMO Mandatory Payment under
Section IV.D.6(b), then if a GMO Mandatory Payment thereunder shall otherwise be
or have been required, the Corporation instead shall have the obligation to
effect on or prior to the first Business Day after the 90th day following the
consummation of such Disposition, a GMO Mandatory Payment pursuant to which it
shall exchange each outstanding share of GMO Stock for a number of fully paid
and nonassessable shares of GGD Stock (calculated to the nearest five decimal
places) equal to (i) the Fair Market Value of one share of the GMO Stock as of
the date of the first public announcement of such Disposition by the Corporation
by press release divided by (ii) the Fair Market Value of one share of GGD Stock
as of such date.
Notwithstanding the foregoing, the Board of Directors may not terminate
any GMO Cash Exchange Right during the period commencing on the date of a
Disposition requiring a GMO Mandatory Payment until the date upon which the
related Mandatory Payment is effected by the Corporation.
(d) Exchange and Redemption Procedures.
(1) If the Corporation determines to
exchange shares of GMO Stock pursuant to Section IV.D.6(a), the Corporation
shall cause notice to be sent not less than 30 nor more than 60 days prior to
the Exchange Date in the form and manner set forth in Section IV.F.1, and the
procedures governing such exchange shall be those set forth in Section IV.F.1.
(2) Not later than the 20th Business Day
following the consummation of a Disposition described in Section IV.D.6(b)(1)
with respect to Genzyme Molecular Oncology Division, the Corporation shall
announce publicly by press release (1) the estimated GMO Net Proceeds, (2) the
number of outstanding shares of GMO Stock and (3) the number of shares of GMO
Stock into or for which Convertible Securities are then convertible,
exchangeable or exercisable and the conversion, exchange or exercise price
thereof (the
Continuation Sheet - 12
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"Estimated GMO Net Proceeds Announcement"). Not earlier than the day immediately
following the 10th Business Day, nor later than the 20th Business Day, following
the date of the Estimated GMO Net Proceeds Announcement, the Corporation shall
announce publicly by press release which of the actions specified in Section
IV.D.6(b)(1) that it has irrevocably determined to make in respect of such
Disposition (the "GMO Mandatory Payment Announcement").
(3) If the Corporation determines to pay a
dividend pursuant to Section IV.D.6(b)(1)(A), the Corporation shall, not later
than the 20th Business Day following the date of the Estimated GMO Net Proceeds
Announcement, cause notice to be sent to the holders of shares of GMO Stock and
to each holder of Convertible Securities that are convertible into or
exchangeable or exercisable for shares of GMO Stock (unless alternate provision
for such notice to the holders of such Convertible Securities is made pursuant
to the terms of such Convertible Securities), setting forth (1) the record date
for determining holders entitled to receive such dividend, which shall be not
earlier than the 10th Business Day and not later than the 20th Business Day
following the date of such notice, (2) the anticipated payment date of such
dividend (which shall not be more than 60 Business Days following the date of
the GMO Mandatory Payment Announcement), (3) the type and amount of property to
be paid as such dividend in respect of the outstanding shares of GMO Stock, (4)
the GMO Net Proceeds, (5) the number of outstanding shares of GMO Stock and the
number of shares of GMO Stock into or for which outstanding Convertible
Securities are then convertible, exchangeable or exercisable and the conversion,
exchange or exercise price thereof and (6) in the case of notice to be given to
holders of Convertible Securities, a statement to the effect that a holder of
such Convertible Securities shall be entitled to receive such dividend only if
such holder properly converts, exchanges or exercises such Convertible
Securities (unless the terms of a Convertible Security provide otherwise) on or
prior to the record date referred to in clause (1) of this sentence. Except as
provided in the preceding sentence, such notice shall conform with the
provisions governing notice at Section IV.F.1 and the provisions governing the
payment of such dividend shall be those set for in such Section IV.F.1 to the
extent such provisions are applicable to the payment of a dividend.
(4) If the Corporation determines to redeem
shares of GMO Stock pursuant to Section IV.D.6(b)(1)(B)(i), the Corporation
shall, not later than the 20th Business Day following the date of the Estimated
GMO Net Proceeds Announcement, cause notice to be sent in the form and manner
set forth in Section IV.F.1, and the procedures governing such redemption shall
be those set forth in Section IV.F.1; provided, however, the Redemption Date
shall not be more than 60 Business Days following the date of the GMO Mandatory
Payment Announcement. Such notice shall also state the GMO Net Proceeds.
(5) If the Corporation determines to redeem
shares of GMO Stock pursuant to Section IV.D.6(b)(1)(B)(ii), the Corporation
shall, not later than the 20th Business Day following the date of the GMO
Estimated Net Proceeds Announcement, cause notice to be sent in the form and
manner set forth in Section IV.F.1, and the procedures governing such redemption
shall be those set forth in Section IV.F.1; provided, however, the Redemption
Date shall not be more than 60 Business Days following the date of the Estimated
GMO Net Proceeds Announcement. The notice delivered hereunder shall also state
(a) the GMO Net Proceeds and (b) a date (the "selection date") not earlier than
the 10th Business Day and not later than the 20th Business Day following the
date of such notice on which shares of GMO Stock shall be selected
Continuation Sheet - 13
<PAGE>
for redemption and that the Corporation will not be required to register a
transfer of any shares of GMO Stock for a period of ten (10) Business Days next
preceding the Selection Date.
(6) If the Corporation determines to
exchange GMO Stock for GGD Stock pursuant to Section IV.D.6(b)(1)(C), the
Corporation shall cause notice to be sent in the form and manner set forth in
Section IV.F.1, and the procedures governing such exchange shall be those set
forth in Section IV.F.1; provided, however, the Exchange Date shall not be more
than 60 Business Days following the date of the GMO Mandatory Payment
Announcement. Such notice shall also state the GMO Net Proceeds.
(7) If the Corporation determines to
exchange GMO Stock for GGD Stock pursuant to Section IV.D.6(c)(3), the
Corporation shall cause notice to be sent not less than 30 nor more than 60 days
in the form and manner set forth in Section IV.F.1, and the procedures governing
such exchange shall be those set forth in Section IV.F.1.
(e) Special Mandatory Payment Provisions. For
purposes of this Section IV.D.6:
(1) "substantially all of the properties and
assets allocated to Genzyme Molecular Oncology Division" shall mean a portion of
the properties and assets allocated to Genzyme Molecular Oncology Division (A)
that represents at least 80% of the then-current fair value (as determined by
the Board of Directors) of, or (B) to which is attributable at least 80% of the
aggregate revenues for the immediately preceding twelve fiscal quarterly periods
of the Corporation derived from, the properties and assets allocated to Genzyme
Molecular Oncology Division;
(2) in the case of a Disposition of
properties and assets in a series of related transactions, such Disposition
shall not be deemed to have been consummated until the consummation of the last
of such transactions; and
(3) in the event that at the time of any
Disposition there are outstanding any Convertible Securities convertible into or
exercisable for shares of GMO Stock that would give the holders rights to
receive any dividend related to the Disposition upon exercise, conversion or
otherwise, or would adjust as a result of such dividend to give the holder
equivalent economic rights, then the shares of GMO Stock underlying such
Convertible Securities will be taken into account for purposes of computing the
GMO Allocation Ratio and determining the terms of any dividend payment on such
shares;
(4) in the event that as a result of or in
connection with a dividend payment pursuant to Section IV.D.6(b)(1)(A) there
ceases to be any properties or assets attributed to Genzyme Molecular Oncology
Division, then each outstanding share of GMO Stock shall immediately following
such dividend payment be cancelled and all rights of a holder of a share of GMO
Stock shall cease except for the right to such dividend payment; and
(5) there shall be added to any cash portion
of a GMO Mandatory Payment paid to holders of GMO Stock, which cash comprised a
portion of the GMO Net Proceeds, any interest earned by Genzyme Molecular
Oncology Division or the Corporation on
Continuation Sheet - 14
<PAGE>
such cash from the date of the Disposition up to the record date of such GMO
Mandatory Payment.
7. Definitions. As used in this Section IV.D., the following
terms shall have the following meanings (with terms defined in the singular
having comparable meaning when used in the plural and vice versa), unless
another definition is provided or the context otherwise requires. Capitalized
terms used but not defined in this Section IV.D.7 shall have the meanings given
them in Section IV.F.7.
(a) "Available GMO Dividend Amount," on any date,
shall mean the greater of:
(1) the excess of
(A) the greater of (x) the fair
value on such date of the net assets of Genzyme Molecular Oncology Division and
(y) an amount equal to $20,500,000 (stockholders' equity allocated to Genzyme
Molecular Oncology Division at September 30, 1996), such dollar amount to be
increased or decreased, as appropriate, to reflect, after September 30, 1996,
(A) the Earnings Attributable to Genzyme Molecular Oncology Division, (B) any
dividends or other distributions (including by reclassification or exchange)
declared or paid with respect to, or repurchases or issuances of, any shares of
GMO Stock or any other class of capital stock attributed to Genzyme Molecular
Oncology Division, but excluding dividends or other distributions paid in shares
of GMO Stock to the holders thereof or in shares of any other class of capital
stock attributed to Genzyme Molecular Oncology Division to the holders thereof,
and (C) any other adjustments to the stockholders' equity of Genzyme Molecular
Oncology Division made in accordance with generally accepted accounting
principles, over
(B) the sum of (x) the aggregate par
value of all outstanding shares of GMO Stock and any other class of capital
stock attributed to Genzyme Molecular Oncology Division and (y) unless these
Articles of Organization permit otherwise, the aggregate amount that would be
needed to satisfy any preferential rights to which holders of all outstanding
Preferred Stock attributed to Genzyme Molecular Oncology Division are entitled
upon dissolution of the Corporation in excess of the aggregate par value of such
Preferred Stock, provided that such excess shall be reduced by any amount
necessary to enable Genzyme Molecular Oncology Division to pay its debts as they
become due, and
(2) the amount legally available for the
payment of dividends determined in accordance with Massachusetts law applied as
if Genzyme Molecular Oncology Division were a separate corporation.
(b) "Earnings Attributable" to Genzyme Molecular
Oncology Division for any period, shall mean the net income or loss of Genzyme
Molecular Oncology Division for such period (or for the fiscal periods of the
Corporation commencing prior to the GMO Effective Date and after September 30,
1996, pro forma net income or loss of Genzyme Molecular Oncology Division as if
the GMO Effective Date were September 30, 1996) determined in accordance with
generally accepted accounting principles, with all income and expenses of the
Corporation being allocated between Divisions in a reasonable and consistent
manner in accordance with policies
Continuation Sheet - 15
<PAGE>
adopted by the Board of Directors; provided, however, that as of the end of any
fiscal quarter of the Corporation, any projected annual tax benefit attributable
to any Division that cannot be utilized by such Division to offset or reduce its
allocated tax liability may be allocated to any other Division without any
compensating payment or allocation.
(c) "GMO Allocation Ratio," as of any date, shall
mean the fraction computed by dividing the GMO Shares Outstanding by the sum of
the GMO Shares Outstanding plus the GMO Designated Shares.
(d) "GMO Designated Shares" as of any date shall mean
a number of shares of GMO Stock that, as of the GMO Effective Date, shall be
6,000,000, which number shall be subject to adjustment as provided in the next
sentence. The number of GMO Designated Shares shall from time to time be
(1) adjusted as appropriate to reflect
subdivisions (by stock split or otherwise) and combinations (by reverse stock
split or otherwise) of the GMO Stock and dividends or distributions of shares of
GMO Stock to holders of GMO Stock and other reclassifications of GMO Stock,
(2) decreased by (A) the number of any
shares of GMO Stock issued by the Corporation, the proceeds of which are
allocated to Genzyme General Division, (B) the number of any shares of GMO Stock
issued upon the exercise or conversion of Convertible Securities attributed to
Genzyme General Division, and (C) the number of any shares of GMO Stock issued
by the Corporation as a dividend or distribution or by reclassification,
exchange or otherwise to holders of GGD Stock, and
(3) increased by (A) the number of any
outstanding shares of GMO Stock repurchased by the Corporation, the
consideration for which was allocated to Genzyme General Division, (B) the
number equal to the fair value (as determined by the Board of Directors) of
assets or properties allocated to Genzyme General Division that are reallocated
to Genzyme Molecular Oncology Division (other than reallocations that represent
sales at fair value between such Divisions) divided by the Fair Market Value of
one share of GMO Stock as of the date of such reallocation, (C) the number equal
to the number of shares into which the Board of Directors elects to convert the
promissory note dated February 10, 1997 issued by PharmaGenics, Inc. to the
Corporation pursuant to the terms of such promissory note and (D) with respect
to the $25 million equity line from Genzyme General Division to Genzyme
Molecular Oncology Division approved by the Corporation's Board of Directors on
January 30, 1997 (the "Equity Line"), if
(A) the closing of the first public
offering by the Corporation of GMO Stock has occurred prior to the third
anniversary of the GMO Effective Date, then, upon such closing, a number equal
to the aggregate of the quotients obtained by dividing (i) the amount of each
advance made under the Equity Line by (ii) the dollar amount determined for each
such advance by the following formula: 7.00 + [(IPOGMO - 7.00) x
(ADATE/IPODATE)]; where IPOGMO = the offering price of the GMO Stock in the
first such public offering, ADATE = the number of days from the GMO Effective
Date to the time of such advance, and IPODATE = the number of days from the GMO
Effective Date to the time of the
Continuation Sheet - 16
<PAGE>
first such public offering; and, thereafter, upon each advance made under the
Equity Line, a number equal to the quotient obtained by dividing (i) the amount
of each such advance by (ii) the Fair Market Value of the GMO Stock on the date
of such advance; or
(B) the closing of the first public
offering by the Corporation of GMO Stock has not occurred prior to the third
anniversary of the GMO Effective Date, then, upon the election of the
Corporation's Board of Directors, a number equal to the quotient obtained by
dividing (i) the aggregate amount of all advances made under the Equity Line by
(ii) the Fair Market Value of the GMO Stock on the date of such third
anniversary;
PROVIDED, that the Corporation shall take no action which would have
the effect of reducing the GMO Designated Shares to a number which is less than
zero. Within 45 days after the end of each fiscal quarter of the Corporation,
the Corporation shall prepare and file a statement of such change with the
transfer agent for the GMO Stock and with the Clerk of the Corporation.
(e) "GMO Effective Date" shall mean June 18, 1997.
(f) "GMO Net Proceeds" shall mean, as of any date,
with respect to a Disposition of any of the properties and assets of Genzyme
Molecular Oncology Division, a fraction of the proceeds from such disposition
determined by multiplying the GMO Allocation Ratio by the gross proceeds of such
Disposition after any adjustment to such gross proceeds resulting from payment
of, or reasonable provision for, (a) any taxes payable by the Corporation in
respect of either such Disposition or any mandatory exchange, redemption or
dividend payment resulting from such Disposition (or that would have been
payable but for the utilization of tax benefits attributable to any division or
group of the Corporation other than Genzyme Molecular Oncology Division (a
"Non-GMO Division")), (b) any transaction costs borne by Non-GMO Division in
connection with such Disposition, including, without limitation, any legal,
investment banking and accounting fees and expenses borne by a Non-GMO Division
in connection with such Disposition, (c) any liabilities and other obligations
(contingent or otherwise) of Genzyme Molecular Oncology Division borne by a
Non-GMO Division in connection with such Disposition, including, without
limitation, any indemnity or guarantee obligations incurred by a Non-GMO
Division in connection with the Disposition or any liabilities assumed by a
Non-GMO Division for future purchase price adjustments, and (d) any preferential
amounts, accumulated and unpaid dividends and other obligations in respect of
any Preferred Stock attributed to Genzyme Molecular Oncology Division.
(g) "GMO Shares Outstanding" as of any date shall
mean the number of shares of GMO Stock then issued and outstanding.
(h) "Genzyme Molecular Oncology Division" shall mean,
at any time, the Corporation's interest in (i) the following businesses,
products, or development or research programs: (A) the use of the Serial
Analysis of Gene Expression ("SAGE") technology licensed from Johns Hopkins
University School of Medicine for third parties; (B) the clinical program
developing adenovirus vectors containing the tumor antigens MART 1 or gp100 for
treatment of melanoma: (C) the "suicide" gene therapy research program
developing adenovirus and lipid vectors containing genes to enhance chemotherapy
for oncology indications; (D) the research
Continuation Sheet - 17
<PAGE>
program developing adenovirus and lipid vectors containing tumor suppressor
genes for oncology indications; (E) the research program developing adenovirus
and lipid containing genes to regulate the immune system for oncology
indications, including heat shock proteins; (F) the research program developing
antibody-targeted gene therapy for treatment of tumors; (G) the research program
developing small molecule compounds to inhibit angiogenesis and stimulate
apoptosis; (H) the research program developing small molecule compounds to
regulate tumor suppressor gene function; and (I) the research program developing
diagnostic applications for tumor suppressor genes and other cancer-related
genes licensed from Hoffmann-La Roche Inc. or identified by Johns Hopkins
University using SAGE technology or other genomic technology; (ii) all assets
and liabilities of the Corporation to the extent allocated to any such
businesses, products, or development or research programs in accordance with
generally accepted accounting principles consistently applied for all of the
Corporation's business units; (iii) to the extent not described above, all
assets and liabilities of PharmaGenics, Inc. as of the GMO Effective Date; and
(iv) such businesses, products, or development or research programs developed
in, or acquired by the Corporation for, Genzyme Molecular Oncology Division
after the GMO Effective Date, in each case as determined by the Board of
Directors; provided, however, that, from and after any Disposition or transfer
to Genzyme General Division of any business, product, development program,
research project, assets or properties, Genzyme Molecular Oncology Division
shall no longer include the business, product, development program, research
project, assets or properties so disposed of or transferred. Genzyme Molecular
Oncology Division shall be represented by the GMO Stock.
E. GENZYME BIOSURGERY DIVISION COMMON STOCK
1. Authorized Amounts and Designations. One hundred million
(100,000,000) shares of Common Stock are designated as a series of Common Stock
with the following designation: Genzyme Biosurgery Division Common Stock (the
"GBS Stock"). To the extent legally permitted, such number of shares may be
increased or decreased by vote of the Board of Directors, provided that no
decrease shall reduce the number of shares of GBS Stock to a number less than
the number of shares of such series then outstanding plus the number of shares
of such series 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 GBS Stock.
2. Dividends and Distributions. Subject to the express terms
of any outstanding series of Preferred Stock, dividends may be declared and paid
upon the GBS Stock, in such amounts and at such times as the Board of Directors
may determine, only out of the lesser of (a) funds of the Corporation legally
available therefor and (b) the Available GBS Dividend Amount.
3. Voting Rights. The holders of GBS Stock, voting
together with the holders of shares of all other series of Common Stock as a
single class of stock, shall have the exclusive right to vote for the election
of directors and on all other matters requiring action by the stockholders or
submitted to the stockholders for action, except as may be determined by the
Board of Directors in establishing any series of Common or Preferred Stock or as
may otherwise be required by law. Each share of GBS Stock shall entitle the
holder thereof to .50 votes through December 31, 2000, or, if no shares of GBS
Stock are outstanding on December 31, 2000,
Continuation Sheet - 18
<PAGE>
through December 31, 2002. On January 1, 2001 or, if no shares of GBS Stock are
outstanding on December 31, 2000, on January 1, 2003, and on each January 1
every two years thereafter, the number of votes to which the holder of each
share of GBS Stock shall be entitled shall be adjusted and fixed for two-year
periods to equal the quotient (expressed as a decimal and rounded to the nearest
two decimal places) obtained by dividing (i) the Fair Market Value of one share
of GBS Stock by (ii) the Fair Market Value of one share of GGD Stock as of such
date. If no shares of GGD Stock are outstanding on such date, then all other
series of voting Common Stock outstanding on such date shall have a number of
votes such that each share of the series of outstanding Common Stock that has
the highest Fair Market Value per share on such date (the "Base Series") shall
have one vote and each share of each other series of outstanding Common Stock
shall have the number of votes determined according to the immediately preceding
sentence, treating, for such purpose, the Base Series as the GGD Stock in such
sentence. If shares of GBS Stock are entitled to vote separately as a class,
each share of GBS Stock shall have one vote.
4. Liquidation, Dissolution or Winding Up. Upon any voluntary
or involuntary liquidation, dissolution or winding up of the Corporation, the
rights of the holders of GBS Stock shall be as follows:
(a) After the Corporation has satisfied or made
provision for its debts and obligations and for the payment to the holders of
shares of any class or series of capital stock having preferential rights to
receive distributions of the net assets of the Corporation (including any
accumulated and unpaid dividends), the holders of GBS Stock shall be entitled to
receive the net assets of the Corporation remaining for distribution, on a per
share basis in proportion to the respective liquidation units per share of all
series of Common Stock. Each share of GBS Stock shall, subject to this Section
IV.E.4(a), have 50 liquidation units.
(b) For the purposes of Section IV.E.4(a). any merger
or business combination involving the Corporation or any sale of all or
substantially all of the assets of the Corporation shall not be treated as a
liquidation.
5. Special Voting Rights. The Corporation shall not, without
approval by the holders of the GBS Stock at a meeting at which a quorum is
present and the votes cast in favor of the proposal exceed those cast against:
(a) allow any proceeds from the Disposition of the
properties or assets allocated to Genzyme Biosurgery Division to be used in the
business of any other Division without fair compensation being allocated to
Genzyme Biosurgery Division as determined by the Board of Directors;
(b) allow any properties or assets allocated to
Genzyme Biosurgery Division to be used in the business of any other Division or
for the declaration or payment of any dividend or distribution on any series of
Common Stock other than the GBS Stock without fair compensation being allocated
to Genzyme Biosurgery Division as determined by the Board of Directors;
Continuation Sheet - 19
<PAGE>
(c) issue, sell or otherwise distribute shares of GBS
Stock without allocating the proceeds or other benefits of such issuance, sale
or distribution to Genzyme Biosurgery Division; provided, however, that the
Corporation may without such approval issue GBS Designated Shares;
(d) change the rights or preferences of the GBS Stock
so as to affect the GBS Stock adversely; or
(e) effect any merger or business combination
involving the Corporation as a result of which (i) the holders of all series of
Common Stock of the Corporation shall no longer own, directly or indirectly, at
least fifty percent (50%) of the voting power of the surviving corporation and
(ii) the holders of all series of Common Stock of the Corporation do not receive
the same form of consideration, distributed among such holders in proportion to
the Market Capitalization of each series of Common Stock as of the date of the
first public announcement of such merger or business combination.
Notwithstanding the foregoing, if the Corporation receives an
opinion of Qualified Tax Counsel that, by reason of any Tax Law Change, the
special voting rights of the GBS Stock set forth in this subsection 5 would
cause a Tax Event absent the termination of such rights, then the Corporation
may, by vote of a majority of the stock outstanding and entitled to vote
thereon, voting together as a single class, authorize an amendment to these
Articles of Organization to effect the termination of such rights in order to
avoid the occurrence of such Tax Event. Any such amendment shall not be deemed
to change the rights or preferences of the GBS Stock so as to affect the GBS
Stock adversely as contemplated by either Section IV.E.5(d) or Section 77 of the
Massachusetts Business Corporation Law.
6. Exchange or Redemption of GBS Stock. Shares of GBS Stock
are subject to exchange or redemption upon the terms and conditions set forth
below:
(a) Optional Exchange of GBS Stock.
(1) The Board of Directors may at any time,
including without limitation in the event of the reallocation, in one
transaction or a series of related transactions, by the Corporation and/or its
subsidiaries of all or substantially all of the properties and assets allocated
to Genzyme Biosurgery Division to any other Division of Genzyme (a "GBS
Reallocation"), declare that each of the outstanding shares of GBS Stock shall
be exchanged, on an Exchange Date, as determined by the Board of Directors, for
(a) a number of fully paid and nonassessable shares of GGD Stock (calculated to
the nearest five decimal places) equal to (1) 130% of the Fair Market Value of
one share of the GBS Stock (the "GBS Optional Exchange Amount") as of the date
of the first public announcement by the Corporation (the "GBS Optional Exchange
Announcement Date") of such exchange divided by (2) the Fair Market Value of one
share of GGD Stock as of such GBS Optional Exchange Announcement Date or (b)
cash equal to the GBS Optional Exchange Amount, or (c) any combination of GGD
Stock and cash equal to the GBS Optional Exchange Amount as determined by the
Board of Directors.
(2) If the Corporation receives an opinion
of Qualified Tax Counsel that a Tax Event has occurred by reason of any Tax Law
Change, then the Board of
Continuation Sheet - 20
<PAGE>
Directors may at any time declare that each of the outstanding shares of GBS
Stock shall be exchanged, on an Exchange Date, as determined by the Board of
Directors, hereof, for a number of fully paid and nonassessable shares of GGD
Stock (calculated to the nearest five decimal places) equal to (1) the Fair
Market Value of one share of the GBS Stock as of the date of the first public
announcement by the Corporation of such exchange divided by (2) the Fair Market
Value of one share of GGD Stock as of such date.
(3) At any time at which all of the assets
and liabilities attributed to Genzyme Biosurgery Division (and no other assets
or liabilities of the Corporation or any subsidiary thereof) are held directly
or indirectly by one or more wholly-owned subsidiaries of the Corporation (each,
a "GBS Subsidiary"), the Board of Directors may, provided that there are funds
of the Corporation legally available therefor, exchange on an Exchange Date, as
determined by the Board of Directors, all of the outstanding shares of GBS Stock
for that number of the shares of common stock (which term, as used throughout
this Section IV.E.6(a)(3), shall refer to any applicable type of equity security
with respect to any GBS Subsidiary that is not a corporation) of each GBS
Subsidiary equal to the number of such GBS Subsidiary shares outstanding
immediately prior to such exchange multiplied by the GBS Allocation Ratio, such
shares of common stock of each GBS Subsidiary to be delivered to the holders of
shares of GBS Stock on the Exchange Date either directly or indirectly through
the delivery of shares of another GBS Subsidiary that owns directly or
indirectly all such shares, and to be divided among the holders of GBS Stock on
a pro rata basis in accordance with the number of shares of GBS Stock held by
each such holder, each of which shares of common stock of such GBS Subsidiary
shall be, upon such delivery, fully paid and nonassessable; provided, however,
that upon any such exchange, any existing GBS Designated Shares shall be
cancelled in exchange for the allocation to Genzyme General of the direct or
indirect interest of the Corporation in any remaining outstanding shares of each
such GBS Subsidiary that are not transferred to the holders of GBS Stock in such
exchange.
(b) Mandatory Exchange or Redemption of or Payment of
Dividend on GBS Stock.
(1) GBS Mandatory Payment. In the event of
the Disposition, in one transaction or a series of related transactions, by the
Corporation and/or its subsidiaries of all or substantially all of the
properties and assets allocated to Genzyme Biosurgery Division to any person,
entity or group (other than a Disposition of a type set forth in subsection (2)
of this subsection (b)), on or prior to the 60th Business Day, or such earlier
date required under this Section IV.E.6, following the date of the GBS Mandatory
Payment Announcement (as defined in Section IV.E.6(d)(2)), the Corporation shall
select one of the following alternatives, as determined by the Board of
Directors in its discretion:
(A) provided that there are funds of
the Corporation legally available therefor, pay to the holders of the shares of
GBS Stock a dividend on a pro rata basis in accordance with the number of shares
of GBS Stock held by each such holder in cash, securities (other than shares of
a series of Common Stock) and/or other property having a Fair Market Value as of
the date of the Disposition in the aggregate equal to the Fair Market Value as
of the date of the Disposition of the GBS Net Proceeds of such Disposition; or
Continuation Sheet - 21
<PAGE>
(B) provided that there are funds of
the Corporation legally available therefor,
(1) if such Disposition
involves all (not merely substantially all) of the properties and assets
attributed to Genzyme Biosurgery Division, redeem or exchange as of a Redemption
Date determined by the Board of Directors, all outstanding shares of GBS Stock
in exchange for, on a pro rata basis, cash, securities (other than shares of a
series of Common Stock) and/or other property having a Fair Market Value as of
the date of the Disposition in the aggregate equal to the Fair Market Value as
of the date of the Disposition of the GBS Net Proceeds of such Disposition; or
(2) if such Disposition
involves substantially all (but not all) of the properties and assets attributed
to Genzyme Biosurgery Division, redeem or exchange as of a Redemption Date as
determined by the Board of Directors such number of whole shares of GBS Stock
(which may be all, but not more than all, of such shares outstanding) as have in
the aggregate an average Closing Price during the period of ten (10) consecutive
Business Days beginning on the first Business Day immediately following the date
of the Estimated GBS Net Proceeds Announcement (as defined in Section
IV.E.6(d)(2)) closest to the Fair Market Value as of the date of the Disposition
of the GBS Net Proceeds of such Disposition in consideration for, on a pro rata
basis, cash, securities (other than shares of a series of Common Stock) and/or
other property having a Fair Market Value as of the date of the Disposition in
the aggregate equal to such Fair Market Value of the GBS Net Proceeds; or
(C) declare that each outstanding
share of GBS Stock shall be exchanged as of an Exchange Date as determined by
the Board of Directors into a number of fully paid and nonassessable shares of
GGD Stock equal to 110% of the ratio (calculated to the nearest five decimal
places) of the average Closing Price of one share of GBS Stock over the period
of ten (10) consecutive Business Days beginning on the first Business Day
immediately following the date of the Estimated GBS Net Proceeds Announcement
(as defined in Section IV.E.6(d)(2)) to the average Closing Price of one share
of GGD Stock over the same ten Business Day period.
Any redemption or exchange of or dividend payment on GBS Stock made pursuant to
this Section IV.E.6(b)(1) or Section IV.E.6(c)(3) is hereinafter referred to as
a "GBS Mandatory Payment." Notwithstanding the foregoing provisions of this
Section IV.E.6(b), the Corporation shall redeem GBS Stock as provided by Section
IV.E.6(b)(1)(B) only if the amount to be paid pursuant to such redemption is
less than or equal to the Available GBS Dividend Amount as of the Redemption
Date.
(2) Exceptions to Mandatory Payment.
Notwithstanding the foregoing Section IV.E.6(b)(1) or Section IV.E.6(c)(3), a
GBS Mandatory Payment shall not be required by the occurrence of a Disposition:
(A) by the Corporation of all or
substantially all of the Corporation's properties and assets in one transaction
or a series of related transactions, including such Disposition in connection
with the dissolution, liquidation or winding up of the Corporation and the
distribution of assets to stockholders as referred to in Section IV.E.4;
Continuation Sheet - 22
<PAGE>
(B) of the properties and assets
attributed to Genzyme Biosurgery Division as contemplated by Section
IV.E.6(a)(3) or otherwise to all holders of GBS Stock divided among such holders
on a pro rata basis in accordance with the number of shares GBS Stock
outstanding;
(C) to any person or entity
controlled (as determined by the Board of Directors) by the Corporation;
(D) in connection with a Related
Business Transaction in respect of Genzyme Biosurgery Division; or
(E) that is conditioned upon the
affirmative vote of the holders of GBS Stock, voting as a separate class.
(c) Termination of Cash Exchange Right. If the
Corporation receives an opinion of Qualified Tax Counsel that, by reason of any
Tax Law Change, the right or obligation of the Corporation to exchange GBS Stock
for cash, securities or other property pursuant to Section IV.E.6(a)(1) or (3)
or IV.E.6(b) (each, a "GBS Cash Exchange Right") would cause a Tax Event if not
terminated, then the Board of Directors may at any time, by a vote of a majority
of the directors then in office, elect to terminate any or all such GBS Cash
Exchange Rights, with the result that the Corporation shall thereafter have,
depending on which GBS Cash Exchange Right(s) is (are) so terminated:
(1) under Section IV.E.6(a)(1) only the
right to cause the exchange of GBS Stock for GGD Stock and not for cash,
securities or other property other than capital stock of the Corporation,
(2) no right to effect an exchange under
Section IV.E.6(a)(3), and/or
(3) no right or obligation to effect a GBS
Mandatory Payment under Section IV.E.6(b), provided that if the Board shall no
longer have the right or obligation to effect a GBS Mandatory Payment under
Section IV.E.6(b), then if a GBS Mandatory Payment thereunder shall otherwise be
or have been required, the Corporation instead shall have the obligation to
effect on or prior to the first Business Day after the 90th day following the
consummation of such Disposition, a GBS Mandatory Payment pursuant to which it
shall exchange each outstanding share of GBS Stock for a number of fully paid
and nonassessable shares of GGD Stock (calculated to the nearest five decimal
places) equal to (i) the Fair Market Value of one share of the GBS Stock as of
the date of the first public announcement of such Disposition by the Corporation
by press release divided by (ii) the Fair Market Value of one share of GGD Stock
as of such date.
Notwithstanding the foregoing, the Board of Directors may not terminate any GBS
Cash Exchange Right during the period commencing on the date of a Disposition
requiring a GBS Mandatory Payment until the date upon which the related GBS
Mandatory Payment is effected by the Corporation.
(d) Exchange and Redemption Procedures.
Continuation Sheet - 23
<PAGE>
(1) If the Corporation determines to
exchange shares of GBS Stock pursuant to Section IV.E.6(a), the Corporation
shall cause notice to be sent not less than 30 nor more than 60 days prior to
the Exchange Date in the form and manner set forth in Section IV.F.1, and the
procedures governing such exchange shall be those set forth in Section IV.F.1.
(2) Not later than the 20th Business Day
following the consummation of a Disposition described in Section IV.E.6(b)(1)
with respect to Genzyme Biosurgery Division, the Corporation shall announce
publicly by press release (1) the estimated GBS Net Proceeds, (2) the number of
outstanding shares of GBS Stock and (3) the number of shares of GBS Stock into
or for which Convertible Securities are then convertible, exchangeable or
exercisable and the conversion, exchange or exercise price thereof (the
"Estimated GBS Net Proceeds Announcement"). Not earlier than the day immediately
following the 10th Business Day, nor later than the 20th Business Day, following
the date of the Estimated GBS Net Proceeds Announcement, the Corporation shall
announce publicly by press release which of the actions specified in Section
IV.E.6(b)(1) that it has irrevocably determined to make in respect of such
Disposition (the "GBS Mandatory Payment Announcement").
(3) If the Corporation determines to pay a
dividend pursuant to Section IV.E.6(b)(1)(A), the Corporation shall, not later
than the 20th Business Day following the date of the Estimated GBS Net Proceeds
Announcement, cause notice to be sent to the holders of shares of GBS Stock and
to each holder of Convertible Securities that are convertible into or
exchangeable or exercisable for shares of GBS Stock (unless alternate provision
for such notice to the holders of such Convertible Securities is made pursuant
to the terms of such Convertible Securities), setting forth (1) the record date
for determining holders entitled to receive such dividend, which shall be not
earlier than the 10th Business Day and not later than the 20th Business Day
following the date of such notice, (2) the anticipated payment date of such
dividend (which shall not be more than 60 Business Days following the date of
the GBS Mandatory Payment Announcement), (3) the type and amount of property to
be paid as such dividend in respect of the outstanding shares of GBS Stock, (4)
the GBS Net Proceeds, (5) the number of outstanding shares of GBS Stock and the
number of shares of GBS Stock into or for which outstanding Convertible
Securities are then convertible, exchangeable or exercisable and the conversion,
exchange or exercise price thereof and (6) in the case of notice to be given to
holders of Convertible Securities, a statement to the effect that a holder of
such Convertible Securities shall be entitled to receive such dividend only if
such holder properly converts, exchanges or exercises such Convertible
Securities (unless the terms of a Convertible Security provide otherwise) on or
prior to the record date referred to in clause (1) of this sentence. Except as
provided in the preceding sentence, such notice shall conform with the
provisions governing notice at Section IV.F.1 and the provisions governing the
payment of such dividend shall be those set for in such Section IV.F.1 to the
extent such provisions are applicable to the payment of a dividend.
(4) If the Corporation determines to redeem
shares of GBS Stock pursuant to Section IV.E.6(b)(1)(b)(i), the Corporation
shall, not later than the 20th Business Day following the date of the Estimated
GBS Net Proceeds Announcement, cause notice to be sent in the form and manner
set forth in Section IV.F.1, and the procedures governing such redemption shall
be those set forth in Section IV.F.1; provided, however, the Redemption Date
Continuation Sheet - 24
<PAGE>
shall not be more than 60 Business Days following the date of the GBS Payment
Method Announcement. Such notice shall also state the GBS Net Proceeds.
(5) If the Corporation determines to redeem
shares of GBS Stock pursuant to Section IV.E.6(b)(1)(B)(ii), the Corporation
shall, not later than the 20th Business Day following the date of the GBS
Estimated Net Proceeds Announcement, cause notice to be sent in the form and
manner set forth in Section IV.F.1, and the procedures governing such redemption
shall be those set forth in Section IV.F.1; provided, however, the Redemption
Date shall not be more than 60 Business Days following the date of the Estimated
GBS Net Proceeds Announcement. The notice delivered hereunder shall also state
(a) the GBS Net Proceeds and (b) a date (the "selection date") not earlier than
the 10th Business Day and not later than the 20th Business Day following the
date of such notice on which shares of GBS Stock shall be selected for
redemption and that the Corporation will not be required to register a transfer
of any shares of GBS Stock for a period of ten (10) Business Days next preceding
the Selection Date.
(6) If the Corporation determines to
exchange GBS Stock for GGD Stock pursuant to Section IV.E.6(b)(1)(C), the
Corporation shall cause notice to be sent in the form and manner set forth in
Section IV.F.1, and the procedures governing such exchange shall be those set
forth in Section IV.F.1; provided, however, the Exchange Date shall not be more
than 60 Business Days following the date of the GBS Mandatory Payment
Announcement. Such notice shall also state the GBS Net Proceeds.
(7) If the Corporation determines to
exchange GBS Stock for GGD Stock pursuant to Section IV.E.6(c)(3), the
Corporation shall cause notice to be sent not less than 30 nor more than 60 days
in the form and manner set forth in Section IV.F.1, and the procedures governing
such exchange shall be those set forth in Section IV.F.1.
(e) Special Mandatory Payment Provisions. For
purposes of this Section IV.E.6:
(1) "substantially all of the properties and
assets allocated to Genzyme Biosurgery Division" shall mean a portion of the
properties and assets allocated to Genzyme Biosurgery Division (A) that
represents at least 80% of the then-current fair value (as determined by the
Board of Directors) of, or (B) to which is attributable at least 80% of the
aggregate revenues for the immediately preceding twelve fiscal quarterly periods
of the Corporation derived from, the properties and assets allocated to Genzyme
Biosurgery Division;
(2) in the case of a Disposition of
properties and assets in a series of related transactions, such Disposition
shall not be deemed to have been consummated until the consummation of the last
of such transactions;
(3) in the event that at the time of any
Disposition there are outstanding any Convertible Securities convertible into or
exercisable for shares of GBS Stock that would give the holders rights to
receive any dividend related to the Disposition upon exercise, conversion or
otherwise, or would adjust as a result of such dividend to give the holder
equivalent economic rights, then the shares of GBS Stock underlying such
Convertible Securities
Continuation Sheet - 25
<PAGE>
will be taken into account for purposes of computing the GBS Allocation Ratio
and determining the terms of any dividend payment on such shares;
(4) in the event that as a result of or in
connection with a dividend payment pursuant to Section IV.E.6(b)(1)(A) there
ceases to be any properties or assets attributed to Genzyme Biosurgery Division,
then each outstanding share of GBS Stock shall immediately following such
dividend payment be cancelled and all rights of a holder of a share of GBS Stock
shall cease except for the right to such dividend payment; and
(5) there shall be added to any cash portion
of a GBS Mandatory Payment paid to holders of GBS Stock, which cash comprised a
portion of the GBS Net Proceeds, any interest earned by Genzyme Biosurgery
Division or the Corporation on such cash from the date of the Disposition up to
the record date of such GBS Mandatory Payment.
7. Definitions. As used in this Section IV.E., the following
terms shall have the following meanings (with terms defined in the singular
having comparable meaning when used in the plural and vice versa), unless
another definition is provided or the context otherwise requires. Capitalized
terms used but not defined in this Section IV.E.7 shall have the meanings given
them in Section IV.F.7.
(a) "Available GBS Dividend Amount," on any date,
shall mean the greater of:
(1) the excess of
(A) the greater of (x) the fair
value on such date of the net assets of Genzyme Biosurgery Division and (y)
an amount equal to $325,166,000 (division equity allocated to Genzyme
Biosurgery Division at June 30, 2000), such dollar amount to be increased or
decreased, as appropriate, to reflect, after June 30, 2000, (A) the Earnings
Attributable to Genzyme Biosurgery Division, (B) any dividends or other
distributions (including by reclassification or exchange) declared or paid
with respect to, or repurchases or issuances of, any shares of GBS Stock or
any other class of capital stock attributed to Genzyme Biosurgery Division,
but excluding dividends or other distributions paid in shares of GBS Stock to
the holders thereof or in shares of any other class of capital stock
attributed to Genzyme Biosurgery Division to the holders thereof, and (C) any
other adjustments to the stockholders' equity of Genzyme Biosurgery Division
made in accordance with generally accepted accounting principles, over
(B) the sum of (x) the aggregate par
value of all outstanding shares of GBS Stock and any other class of capital
stock attributed to Genzyme Biosurgery Division and (y) unless these Articles of
Organization permit otherwise, the aggregate amount that would be needed to
satisfy any preferential rights to which holders of all outstanding Preferred
Stock attributed to Genzyme Biosurgery Division are entitled upon dissolution of
the Corporation in excess of the aggregate par value of such Preferred Stock,
provided that such excess shall be reduced by any amount necessary to enable
Genzyme Biosurgery Division to pay its debts as they become due, and
Continuation Sheet - 26
<PAGE>
(2) the amount legally available for the
payment of dividends determined in accordance with Massachusetts law applied as
if Genzyme Biosurgery Division were a separate corporation.
(b) "Earnings Attributable" to Genzyme Biosurgery
Division for any period shall mean the net income or loss of Genzyme Biosurgery
Division for such period (or for the fiscal periods of the Corporation
commencing prior to the GBS Effective Date and after June 30, 2000, pro forma
net income or loss of Genzyme Biosurgery Division as if the GBS Effective Date
were June 30, 2000) determined in accordance with generally accepted accounting
principles, with all income and expenses of the Corporation being allocated
between Divisions in a reasonable and consistent manner in accordance with
policies adopted by the Board of Directors; provided, however, that as of the
end of any fiscal quarter of the Corporation, any projected annual tax benefit
attributable to any Division that cannot be utilized by such Division to offset
or reduce its allocated tax liability may be allocated to any other Division
without any compensating payment or allocation.
(c) "GBS Allocation Ratio," as of any date, shall
mean the fraction computed by dividing the GBS Shares Outstanding by the sum of
the GBS Shares Outstanding plus the GBS Designated Shares.
(d) "GBS Designated Shares" as of any date shall mean
a number of shares of GBS Stock that, as of the GBS Effective Date, shall be
1,355,552, which number shall be subject to adjustment as provided in the
next sentence. The number of Genzyme Biosurgery Designated Shares shall from
time to time be
(1) adjusted as appropriate to reflect
subdivisions (by stock split or otherwise) and combinations (by reverse stock
split or otherwise) of the GBS Stock and dividends or distributions of shares of
GBS Stock to holders of GBS Stock and other reclassifications of GBS Stock,
(2) decreased by (A) the number of any
shares of GBS Stock issued by the Corporation, the proceeds of which are
allocated to Genzyme General Division, (B) the number of any shares of GBS Stock
issued upon the exercise or conversion of Convertible Securities attributed to
Genzyme General Division, and (C) the number of any shares of GBS Stock issued
by the Corporation as a dividend or distribution or by reclassification,
exchange or otherwise to holders of GGD Stock, and
(3) increased by (A) the number of any
outstanding shares of GBS Stock repurchased by the Corporation, the
consideration for which was allocated to Genzyme General Division, (B) the
number equal to the fair value (as determined by the Board of Directors) of
assets or properties allocated to Genzyme General Division that are reallocated
to Genzyme Biosurgery Division (other than reallocations that represent sales at
fair value between such Divisions) divided by the Fair Market Value of one share
of GBS Stock as of the date of such reallocation, (C) the number equal to (i)
the aggregate Fair Market Value of any shares of GGD Stock issued to the limited
partners of Genzyme Development Partners L.P. ("GDP") in connection with the
Corporation's exercise on behalf of Genzyme Biosurgery Division of its purchase
option to reacquire all of the limited partnership interests of GDP divided by
(ii) the
Continuation Sheet - 27
<PAGE>
Fair Market Value of one share of GBS Stock as of the date of such exercise, and
(D) the number equal to Fair Market Value of any shares of GBS Stock issued to
Genzyme General Division in satisfaction of its refunding obligations under the
Confirmation and Acknowledgement of Programmer Allocation, dated as of June 21,
1999, in connection with the transfer by the Genzyme Tissue Repair Division of
its ownership interest in the Diacrin/Genzyme LLC to the Genzyme General
Division.
PROVIDED, that the Corporation shall take no action which would have
the effect of reducing the GBS Designated Shares to a number which is less than
zero. Within 45 days after the end of each fiscal quarter of the Corporation,
the Corporation shall prepare and file a statement of such change with the
transfer agent for the GBS Stock and with the Clerk of the Corporation.
(e) "GBS Effective Date" shall mean December 18,
2000.
(f) "GBS Net Proceeds" shall mean, as of any date,
with respect to a Disposition of any of the properties and assets of Genzyme
Biosurgery Division, a fraction of the proceeds from such disposition determined
by multiplying the GBS Allocation Ratio by the gross proceeds of such
Disposition after any adjustment to such gross proceeds resulting from payment
of, or reasonable provision for, (a) any taxes payable by the Corporation in
respect of either such Disposition or any mandatory exchange, redemption or
dividend payment resulting from such Disposition (or that would have been
payable but for the utilization of tax benefits attributable to any division or
group of the Corporation other than Genzyme Biosurgery Division (a "Non-GBS
Division")), (b) any transaction costs borne by a Non-GBS Division in connection
with such Disposition, including, without limitation, any legal, investment
banking and accounting fees and expenses borne by a Non-GBS Division in
connection with such Disposition, (c) any liabilities and other obligations
(contingent or otherwise) of Genzyme Biosurgery Division borne by a Non-GBS
Division in connection with such Disposition, including, without limitation, any
indemnity or guarantee obligations incurred by a Non-GBS Division in connection
with the Disposition or any liabilities assumed by a Non-GBS Division for future
purchase price adjustments, and (d) any preferential amounts, accumulated and
unpaid dividends and other obligations in respect of any Preferred Stock
attributed to Genzyme Biosurgery Division.
(g) "GBS Shares Outstanding" as of any date shall
mean the number of shares of GBS Stock then issued and outstanding.
"Genzyme Biosurgery Division" shall mean, at any time, the
Corporation's interest in [(i) businesses, products, or development or research
programs relating to (A) the prevention or treatment of tissue damage and (B)
surgical devices, closures, instruments, biomaterials and biotherapeutics
directed toward the cardiovascular, general and plastic surgery markets, which
exist as of the GBS Effective Date (other than such businesses, products, or
development or research programs allocated to Genzyme Development Partners, L.P.
or that were allocated to the Genzyme Molecular Oncology or Genzyme General
divisions immediately prior to the GBS Effective Date);] (ii) all assets and
liabilities of the Corporation to the extent allocated to any such businesses,
products, or development or research programs in accordance with generally
accepted accounting principles consistently applied for all of the Corporation's
business units;
Continuation Sheet - 28
<PAGE>
and (iii) such businesses, products, or development or research programs
developed in, or acquired by the Corporation for, Genzyme Biosurgery Division on
or after the GBS Effective Date, in each case as determined by the Board of
Directors; PROVIDED, HOWEVER, that, from and after any Disposition or transfer
to another Division of any business, product, development program, research
project, assets or properties, Genzyme Biosurgery Division shall no longer
include the business, product, development program, research project, assets or
properties so disposed of or transferred. Genzyme Biosurgery Division shall be
represented by the GBS Stock.
F. GENERAL PROVISIONS REGARDING THE COMMON STOCK
1. General Exchange and Redemption Provisions. In the event of
any exchange or mandatory redemption or dividend pursuant to the provisions of
these Articles of Organization, the following provisions shall apply:
(a) Any notice delivered hereunder shall be sent by
the Corporation to each record holder of shares of the Common Stock to be
exchanged or redeemed or upon which will be made a dividend payment (the
"Exchange Stock") and to the holders of Convertible Securities that are
convertible into or exchangeable or exercisable for shares of such Exchange
Stock (unless alternate provision for such notice is made pursuant to the terms
of such Convertible Securities). Unless otherwise required by any other
provision of these Articles of Organization, such notice shall be sent not less
nor more than 60 days prior to the Exchange Date.
(b) With respect to an exchange or redemption, such
notice shall state, to the extent and in the manner applicable, (1) the number
of shares of Exchange Stock outstanding on the record date for such exchange or
redemption and the number of such shares to be redeemed or exchanged, (2) the
aggregate amount and form of consideration, including shares of Common Stock,
other securities, cash or other property, that will be paid on the Exchange Date
or Redemption Date upon the exchange or redemption of the shares of Exchange
Stock, (3) the amount and form of such consideration to be received by such
holder with respect to each share of the Exchange Stock held by such holder,
including details as to the calculation thereof, (4) the Exchange Date or
Redemption Date, (5) the place or places where certificates for shares of
Exchange Stock, properly endorsed or assigned for transfer are to be surrendered
for delivery of such consideration (unless the Corporation shall waive such
requirement), (6), if applicable, a statement to the effect that, subject to
Section IV.F.1(e) dividends on shares of Exchange Stock shall cease to be paid
as of such Exchange Date or Redemption Date, (7) the number of shares of
Exchange Stock into or for which outstanding Convertible Securities are
convertible, exchangeable or exercisable as of the record date for such exchange
or redemption and the conversion, exchange or exercise price thereof and (8) in
the case of notice to holders of Convertible Securities, a statement to the
effect that a holder of Convertible Securities shall be entitled to receive its
pro rata portion of the consideration, as applicable, upon redemption or
exchange only if such holder properly converts, exchanges or exercises such
Convertible Securities (unless the terms of a Convertible Security provide
otherwise) on or prior to the Exchange Date or Redemption Date and a statement
as to what, if anything, such holder will be entitled to receive pursuant to the
terms of such Convertible Securities if such holder thereafter converts,
exchanges or exercises such Convertible Securities.
Continuation Sheet - 29
<PAGE>
(c) Any notice delivered under this Section IV.F.1
shall be sent by first-class mail, postage prepaid at such holder's address as
the same appears on the stock transfer books of the Corporation. Neither the
failure to mail such notice to any particular holder of shares of Exchange Stock
nor any defect therein shall affect the sufficiency thereof with respect to any
other holder of shares of Exchange Stock or the validity of any such exchange,
redemption or dividend payment.
(d) The Corporation shall not be required to issue or
deliver fractional shares of any series of Common Stock, capital stock,
securities or other property to any holder of shares of Exchange Stock upon any
such exchange, redemption or dividend payment. If more than one share of
Exchange Stock shall be held by the same holder of record, the Corporation shall
aggregate the number of shares of any security that shall be issuable or any
other property that shall be distributable to such holder upon any such
exchange, redemption or dividend payment. If fractional shares of any security
would be required to be issued or distributed to the holder of Exchange Stock,
the Corporation shall, if such fractional shares are not issued or distributed
to such holder, either arrange for the disposition of such fraction by or on
behalf of such holder or pay the Fair Market Value (without interest) of such
fractional shares.
(e) No adjustments in respect of dividends shall be
made upon the exchange or redemption of any shares of Exchange Stock; provided,
however, that if the Exchange Date shall be subsequent to the record date for
determining holders of Exchange Stock entitled to the payment of a dividend or
other distribution thereon or with respect thereto, the holders of shares of
Exchange Stock at the close of business on such record date shall be entitled to
receive the dividend or other distribution payable on or with respect to such
shares on the date set for payment of such dividend or other distribution,
notwithstanding the exchange or redemption of such shares.
(f) With respect to an exchange or redemption, before
any holder of shares of Exchange Stock shall be entitled to receive the
consideration to be received by such holder with respect to the exchange or
redemption of such shares of Exchange Stock, such holder shall surrender at such
place as the Corporation shall specify certificates for such shares of Exchange
Stock, properly endorsed or assigned for transfer (unless the Corporation shall
waive such requirement). The Corporation will as soon as practicable after such
surrender of certificates representing such shares of Exchange Stock deliver to
the person for whose account such shares of Exchange Stock were so surrendered,
or to the nominee or nominees of such person, the consideration to which such
person shall be entitled as aforesaid, together with any fractional share
payment contemplated by Section IV.F.1(d).
(g) With respect to an exchange or redemption, from
and after the Exchange Date, all rights of a holder of shares of Exchange Stock
shall cease except for the right, upon surrender of the certificates
representing such shares of Exchange Stock, to receive the consideration for
which such shares were exchanged are redeemed, together with any fractional
share payment contemplated by Section IV.F.1(d), and rights to dividends as
provided in Section IV.F.1(e). No holder of a certificate that immediately prior
to the Exchange Date represented shares of Exchange Stock shall be entitled to
receive any dividend or interest payment or other distribution with respect to
the shares of any security or instrument for which the Exchange Stock was
exchanged or redeemed until surrender of such holder's certificate for a
Continuation Sheet - 30
<PAGE>
certificate or certificates or instrument or instruments representing such
security (unless the Corporation shall waive such requirement). Subject to
applicable escheat and similar laws, upon such surrender, there shall be paid to
the holder the amount of any dividend or interest payments or other
distributions (without interest) which theretofore became payable with respect
to a record date after the Exchange Date, but that were not paid by reason of
the foregoing, with respect to the number of shares of the kind of securities
represented by the certificate or certificates issued upon such surrender. From
and after the Exchange Date, the Corporation shall, however, be entitled to
treat the certificates for Exchange Stock that have not yet been surrendered for
exchange or redemption as evidencing the ownership of the number of shares of
the kind of securities for which the shares of Exchange Stock represented by
such certificates shall have been exchanged or redeemed, notwithstanding the
failure to surrender such certificates.
(h) The Corporation will pay any and all documentary,
stamp or similar issue or transfer taxes that may be payable in respect of the
issue or delivery of any securities in exchange for or upon redemption of or
dividend payment on shares of Exchange Stock pursuant hereto. The Corporation
shall not, however, be required to pay any tax that may be payable in respect of
any transfer involved in the issue and delivery of any such securities issued in
exchange or upon redemption or as a dividend in a name other than that in which
the shares of Exchange Stock so exchanged or redeemed or paid as a dividend upon
were registered and no such issue or delivery shall be made unless and until the
person requesting such issue has paid to the Corporation the amount of any such
tax, or has established to the satisfaction of the Corporation that such tax has
been paid or that no such tax is due.
(i) After the Exchange Date, any share of Exchange
Stock issued upon conversion or exercise of any Convertible Security shall,
immediately upon issuance pursuant to such conversion or exercise and without
any notice or any other action on the part of the Corporation or its Board of
Directors or the holder of such share of Exchange Stock, be exchanged for the
amount of cash, securities and/or other property thereof (together with any
payments in lieu of fractional shares or dividends, if any) that a holder of
such Convertible Security would have been entitled to receive pursuant to the
terms of such Convertible Security had such terms provided that the conversion
privilege in effect immediately prior to any exchange by the Corporation of any
shares of Exchange Stock would be adjusted so that the holder of any such
Convertible Security thereafter surrendered for conversion would be entitled to
receive the amount of cash, securities and/or other property he or she would
have owned immediately following such action had such Convertible Security been
converted immediately prior to such exchange. The foregoing provisions shall not
apply to the extent that equivalent adjustments are otherwise made pursuant to
the provisions of such Convertible Security.
2. Voting of Controlled Shares. Shares of any series of Common
Stock held by a corporation or other entity controlled by the Corporation (other
than an employee benefit plan) shall be voted on any proposal requiring a vote
of the holders of such series in the same proportion as votes are cast for or
against such proposal by all other holders of such series.
3. Discrimination Between Classes of Common Stock. Subject to
the provisions of each series of Common Stock regarding the payment of dividends
on such series of Common Stock, the Board of Directors may, in its sole
discretion, declare and pay dividends
Continuation Sheet - 31
<PAGE>
exclusively on any series of Common Stock, or all series, in equal or unequal
amounts, notwithstanding the amounts available for the payment of dividends on
any series, the respective voting and liquidation rights of each series, the
amounts of prior dividends declared on each series or any other factor.
4. Adjustments Relative to Voting Rights and Liquidation. If
at any time the Corporation shall in any manner subdivide (by stock split,
reclassification or otherwise) or combine (by reverse stock split,
reclassification or otherwise) the outstanding shares of any series of Common
Stock, or pay a dividend or make a distribution in shares of any series of
Common Stock to holders of such series, the per share voting rights and the
liquidation units of each series of Common Stock other than the GGD Stock shall
be appropriately adjusted so as to avoid dilution in the aggregate voting and
liquidation rights of any series. The issuance by the Corporation of shares of
any series of Common Stock (whether by a dividend or otherwise) to the holders
of any other series of Common Stock shall not require adjustment pursuant to
this paragraph.
5. Rank. All series of Common Stock shall rank junior with
respect to the payment of dividends and the distribution of assets to all series
of the Corporation's Preferred Stock that specifically provide that they shall
rank prior to the Common Stock. Nothing herein shall preclude the Board from
creating any series of Preferred Stock ranking on a parity with or prior to the
Common Stock as to the payment of dividends or the distribution of assets.
6. Fractional Shares. Any series of Common Stock may be issued
in fractions of a share which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of such series of Common Stock.
7. Definitions. As used in these Articles of Organization, the
following terms shall have the following meanings (with terms defined in the
singular having comparable meaning when used in the plural and vice versa),
unless another definition is provided or the context otherwise requires:
(a) "Business Day" shall mean each weekday other than
any day on which any relevant series of common stock is not traded on any
national securities exchange or the Nasdaq National Market or in the
over-the-counter market.
(b) The "Closing Price," with respect to any
security, as of any given day, shall be (x) if such security is listed or
admitted to trading on a national securities exchange, the closing price on the
New York Stock Exchange Composite Tape (or any successor composite tape
reporting transactions on national securities exchanges) or, if such composite
tape shall not be in use or shall not report transactions in such shares, the
last reported sales price regular way on the principal national securities
exchange on which such shares are listed or admitted to trading (which shall be
the national securities exchange on which the greatest number of shares of such
series of stock has been traded during such consecutive trading days), or, if
there is no such sale on any such day, the mean of the bid and asked prices on
such day, or (y) if such shares are not listed or admitted to trading on any
such exchange, the closing price, if reported, or, if the closing price is not
reported, the mean of the closing bid and asked prices as reported by the
Continuation Sheet - 32
<PAGE>
Nasdaq National Market or a similar source selected from time to time by the
Corporation for the purpose.
(c) "Convertible Securities" shall mean any
securities (including employee stock options) of the Corporation that are
convertible into or evidence the right to purchase any shares of any series of
Common Stock.
(d) "Disposition" shall mean the sale, transfer,
assignment or other disposition (whether by merger, consolidation, sale or
contribution of assets or stock or otherwise) of any properties or assets, other
than by pledge, hypothecation or grant of any security interest in such
properties or assets.
(e) "Exchange Date" shall mean, in respect of any
exchange of any share of a series of Common Stock effected pursuant to these
Articles of Organization, the date upon which such exchange becomes effective.
(f) "Fair Market Value" shall mean
(1) as to shares of any series of stock of
the Corporation as of any date, the average of the daily Closing Prices for the
20 consecutive Business Days commencing on the 30th Business Day prior to such
date, except that in the event such Closing Prices are unavailable, Fair Market
Value shall be determined by the Board of Directors;
(2) in the case of securities other than
securities of the Corporation, if such security of a class that has previously
been publicly traded for a period of at least three months, the Market Value
thereof or, in the case of a security that has not been publicly traded for at
least such period, the fair value per share of stock or per other unit of such
security, on a fully distributed basis, as determined by an independent
investment banking firm experienced in the valuation of securities selected in
good faith by the Board of Directors;
(3) in the case of property other than
securities, the "Fair Market Value" as determined in good faith by the Board of
Directors based upon such appraisals or valuation reports of such independent
experts as the Board of Directors shall in good faith determine to be
appropriate in accordance with good business practice.
Any determination of Fair Market Value made under clauses 2 or
3 above shall be described in a statement filed with the records of the actions
of the Board of Directors.
(g) "Market Capitalization" of any series of Common
stock on any date shall mean the product of (i) the Fair Market Value of one
share of such series of Common Stock on such date and (ii) the number of shares
of such series of Common Stock outstanding on such date.
(h) "Market Value" as of any day of any security
shall mean the average of the high and low reported sales prices regular way of
a share of such class or series on such day (if such day is a Business Day, and,
if such day is not a Business Day, on the Business Day immediately preceding
such day); or, in case no such reported sale takes place on such Business Day,
the average of the reported closing bid and asked prices regular way of a share
of such class
Continuation Sheet - 33
<PAGE>
or series on such Business Day, in either case, on the New York Stock Exchange;
or, if the shares of such class or series are not quoted on the New York Stock
Exchange on such Business Day, on the Nasdaq National Market; or, if the shares
of such class or series are not quoted on the Nasdaq National Market on such
Business Day, the average of the closing bid and asked prices of a share of such
class or series in the over-the-counter market on such Business Day as furnished
by any New York Stock Exchange member firm selected from time to time by the
corporation; or, if such closing bid and asked prices are not made available by
any such New York Stock Exchange member firm on such Business Day (including,
without limitation, because such securities are not publicly held), the market
value as determined by an independent investment banking firm experienced in the
valuation of securities selected in good faith by the Board of Directors. Any
determination of Fair Market Value made under the final clause of the preceding
sentence shall be described in a statement filed with the records of the actions
of the Board of Directors.
(i) "Qualified Tax Counsel" shall mean tax counsel
who may be regular outside counsel to the Corporation but shall not be an
officer or employee of the Corporation or any of its affiliates.
(j) "Redemption Date" shall mean, in respect of any
redemption of any share of a series of Common Stock effected pursuant to these
Articles of Organization, the date upon which such redemption becomes effective.
(k) "Related Business Transaction" shall mean, with
respect to the Disposition of all or substantially all the properties and assets
attributed to a particular series of Common Stock, such Disposition in a
transaction or series of related transactions that result in the Corporation
receiving in consideration of such properties and assets primarily equity
securities (including, without limitation, capital stock, debt securities
convertible into or exchangeable for equity securities or interests in a general
or limited partnership or limited liability company, without regard to the
voting power or other management or governance rights associated therewith) of
any entity which (i) acquires such properties or assets or succeeds (by merger,
formation of a joint venture or otherwise) to the business conducted with such
properties or assets or controls such acquiror or successor and (ii) is engaged
primarily or proposes to engage primarily in one or more businesses similar or
complementary to the businesses conducted by the division or group of the
Corporation to which were attributed such properties and assets prior to such
Disposition, as determined by the Board of Directors.
(l) "Tax Event" shall mean, with respect to any
series of Common Stock that it has become (or will become, as the context may
require) more likely than not that for United States Federal income tax purposes
(i) the Corporation or the holders of its stock are, or at any time in the
future will be, subject to tax or other adverse tax consequences upon the
issuance or receipt of shares of such series of Common Stock or by reason of the
existence of such series of Common Stock or (ii) either such series of Common
Stock or the GGD Stock is not, or at any time in the future will not be, treated
solely as stock of the Corporation.
(m) "Tax Law Change" shall mean (i) any enactment of,
amendment to, or change in the laws of the United States or any political
subdivision thereof (including any announced proposed change by an applicable
legislative committee or the chair in such laws),
Continuation Sheet - 34
<PAGE>
(ii) any promulgation of, amendment to, or change in the regulations under the
laws of the United States or any political subdivision or taxing authority
thereof or therein (including any announced proposed change in or promulgation
of regulations by an administrative agency) or (iii) any official or
administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations. For purposes of rendering an opinion as to a
Tax Law Change, tax counsel shall assume that any legislative or administrative
proposals will be adopted or enacted as proposed.
8. Determinations By The Board Of Directors. Any
determinations with respect to any Division or the rights of holders of any
series of Common Stock made by the Board of Directors of the Corporation in good
faith pursuant to or in furtherance of any provision of these Articles of
Organization relating to the Common Stock shall be final and binding on all
stockholders of the Corporation.
G. DESCRIPTION OF THE PREFERRED STOCK
1. Undesignated Preferred Stock. Shares of Preferred Stock may
be issued from time to time in one or more series. The Board of Directors may
determine, in whole or in part, the preferences, voting powers, qualifications
and special or relative rights or privileges of any such series before the
issuance of any shares of that series. The Board of Directors shall determine
the number of shares constituting each series of Preferred Stock and each series
shall have a distinguishing designation.
2. Terms Of The Series A, Series B And Series C Junior
Participating Preferred Stock.
(a) Authorized Amounts and Designations. Two million
(2,000,000) shares of Preferred Stock of the Corporation are designated as
Series A Junior Participating Preferred Stock (the "Series A Preferred Stock"),
one million (1,000,000) shares of Preferred Stock are designated as Series B
Junior Participating Preferred Stock (the "Series B Preferred Stock") and four
hundred thousand (400,000) shares of Preferred Stock are designated as Series C
Junior Participating Preferred Stock (the "Series C Preferred Stock" and,
together with the Series A Preferred Stock, the Series B Preferred Stock and any
other series of Preferred Stock so designated by the Corporation's Board of
Directors, the "Junior Preferred Stock"). To the extent legally permitted, such
numbers of shares may be increased or decreased by vote of the Board of
Directors, provided that no decrease shall reduce the number of shares of Junior
Preferred Stock of any series to a number less than the number of shares of such
series then outstanding plus the number of shares of such series 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 such series of Junior Preferred Stock.
(b) Series A Preferred Stock. A description of the
Series A Preferred Stock and a statement of its preferences, voting powers,
qualifications and special or relative rights or privileges is as follows:
(1) Dividends and Distributions.
Continuation Sheet - 35
<PAGE>
(A) Subject to the prior and
superior rights of the holders of any shares of any series of Preferred 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 all shares of common stock of the Corporation (the "Common
Shares"), and of any other junior stock, shall be entitled to receive, when, as
and if declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the first day of March, June,
September and December in each year (each such date being referred to herein as
a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1.00 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions, other than a dividend on shares of
the GGD Stock payable in shares of GGD Stock or a subdivision of the outstanding
shares of GGD Stock (by reclassification or otherwise), declared on the GGD
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 after December 18, 2000 declare or pay any
dividend on shares of GGD Stock payable in shares of GGD Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of GGD
Stock (by reclassification or otherwise than by payment of a dividend in shares
of GGD Stock) into a greater or lesser number of shares of GGD 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 GGD Stock outstanding immediately
after such event and the denominator of which is the number of shares of GGD
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 Section
IV.G.2(b)(1)(A) immediately after it declares a dividend or distribution on any
shares of GGD Stock (other than a dividend payable in shares of GGD Stock),
provided that, in the event no dividend or distribution shall have been declared
on the GGD Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend of $1.00 per
share on the Series A Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue
and be cumulative on outstanding shares of Series A Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for the
first Quarterly Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the date
of issue is a Quarterly Dividend Payment Date or is a date after the record date
for the determination of holders of shares of Series A Preferred Stock entitled
to receive a quarterly dividend and before such Quarterly Dividend Payment Date,
in either of which events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall
not bear interest. Dividends paid on the shares of Series A Preferred Stock in
an
Continuation Sheet - 36
<PAGE>
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.
(2) Voting Rights. The holders of shares of
Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for
adjustment hereinafter set forth, each share of Series A Preferred Stock shall
entitle the holder thereof to 100 votes on all matters submitted to a vote of
the stockholders of the Corporation. In the event the Corporation shall at any
time after December 18, 2000 declare or pay any dividend on any shares of GGD
Stock payable in shares of GGD Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of GGD Stock (by reclassification or
otherwise than by payment of a dividend in shares of GGD Stock) into a greater
or lesser number of shares of GGD Stock, then in each such case the number of
votes per share to which holders of shares of Series A Preferred Stock were
entitled immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the numerator of which is the number of shares of GGD
Stock outstanding immediately after such event and the denominator of which is
the number of shares of GGD Stock that were outstanding immediately prior to
such event.
(B) Except as otherwise provided
herein, in any vote of the Board of Directors of the Corporation creating a
series of Preferred Stock, or by law, the holders of shares of Series A
Preferred Stock and the holders of Common Shares and any other capital stock of
the Corporation having general voting rights shall vote together as one series
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
voting rights.
(3) 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
GGD 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 other 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 after
December 18, 2000 declare or pay any dividend on shares of GGD Stock payable in
shares of
Continuation Sheet - 37
<PAGE>
GGD Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of GGD Stock (by reclassification or otherwise than by
payment of a dividend in shares of GGD Stock) into a greater or lesser number of
shares of GGD 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 GGD Stock outstanding immediately after such event and the
denominator of which is the number of shares of GGD Stock that were outstanding
immediately prior to such event.
(4) Consolidation, Merger, Etc. In case the
Corporation shall enter into any consolidation, merger, combination or other
transaction in which Common Shares 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 GGD Stock is changed or exchanged. In
the event the Corporation shall at any time after December 18, 2000 declare or
pay any dividend on any shares of GGD Stock payable in shares of GGD Stock, or
effect a subdivision or combination or consolidation of the outstanding shares
of GGD Stock (by reclassification or otherwise than by payment of a dividend in
shares of GGD Stock) into a greater or lesser number of shares of GGD 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 GGD Stock outstanding immediately after such event and the
denominator of which is the number of shares of GGD Stock that were outstanding
immediately prior to such event.
(c) Series B Preferred Stock. A description of the
Series B Preferred Stock and a statement of its preferences, voting powers,
qualifications and special or relative rights or privileges is as follows:
(1) Dividends and Distributions.
(A) Subject to the prior and
superior rights of the holders of any shares of any series of Preferred Stock
ranking prior and superior to the Series B Preferred Stock with respect to
dividends, the holders of shares of Series B Preferred Stock, in preference to
the holders of all Common Shares, 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
each 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 B Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1.00 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions, other than a dividend on shares of
the GBS Stock payable in shares of GBS Stock or a subdivision of the outstanding
shares of GBS Stock (by reclassification or otherwise), declared on the GBS
Stock since the immediately preceding Quarterly Dividend Payment Date or, with
respect to the first Quarterly
Continuation Sheet - 38
<PAGE>
Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series B Preferred Stock. In the event the Corporation shall at any
time after December 18, 2000 declare or pay any dividend on any shares of GBS
Stock payable in shares of GBS Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of GBS Stock (by reclassification or
otherwise than by payment of a dividend in shares of GBS Stock) into a greater
or lesser number of shares of GBS Stock, then in each such case the amount to
which holders of shares of Series B 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 GBS Stock outstanding immediately after such event and the
denominator of which is the number of shares of GBS Stock that were outstanding
immediately prior to such event.
(B) The Corporation shall declare a
dividend or distribution on the Series B Preferred Stock as provided in Section
IV.G.2(c)(1)(A) immediately after it declares a dividend or distribution on any
shares of GBS Stock (other than a dividend payable in shares of GBS Stock),
provided that, in the event no dividend or distribution shall have been declared
on the GBS Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend of $1.00 per
share on the Series B 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 B 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 B 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 B 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 B 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.
(2) Voting Rights. The holders of shares of
Series B Preferred Stock shall have the following voting rights:
(A) Subject to the provision for
adjustment hereinafter set forth, each share of Series B Preferred Stock shall
entitle the holder thereof to 100 times the number of votes to which the holder
of each outstanding share of GBS Stock is then entitled on all matters submitted
to a vote of the stockholders of the Corporation. In the event the Corporation
shall at any time after December 18, 2000 declare or pay any dividend on shares
of GBS Stock payable in shares of GBS Stock, or effect a subdivision or
combination or
Continuation Sheet - 39
<PAGE>
consolidation of the outstanding shares of GBS Stock (by reclassification or
otherwise than by payment of a dividend in shares of GBS Stock) into a greater
or lesser number of shares of GBS Stock, then in each such case the number of
votes per share to which holders of shares of Series B 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 GBS
Stock outstanding immediately after such event and the denominator of which is
the number of shares of GBS Stock that were outstanding immediately prior to
such event.
(B) Except as otherwise provided
herein, in any vote of the Board of Directors of the Corporation creating a
series of Preferred Stock, or by law, the holders of shares of Series B
Preferred Stock and the holders of Common Shares and any other capital stock of
the Corporation having general voting rights shall vote together as one series
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 B Preferred Stock shall have no
voting rights.
(3) 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 B Preferred Stock unless, prior thereto, the holders of shares of Series
B 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 B
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
GBS 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
B Preferred Stock, except distributions made ratably on the Series B Preferred
Stock and all other 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 after
December 18, 2000 declare or pay any dividend on any shares of GBS Stock payable
in shares of GBS Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of GBS Stock (by reclassification or otherwise than by
payment of a dividend in shares of GBS Stock) into a greater or lesser number of
shares of GBS Stock, then in each such case the aggregate amount to which
holders of shares of Series B 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 GBS Stock outstanding immediately after such event and the
denominator of which is the number of shares of GBS Stock that were outstanding
immediately prior to such event.
(4) Consolidation, Merger, Etc. In case the
Corporation shall enter into any consolidation, merger, combination or other
transaction in which Common Shares 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 B 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
Continuation Sheet - 40
<PAGE>
any other property (payable in kind), as the case may be, into which or for
which each share of GBS Stock is changed or exchanged. In the event the
Corporation shall at any time after December 18, 2000 declare or pay any
dividend on any shares of GBS Stock payable in shares of GBS Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of GBS
Stock (by reclassification or otherwise than by payment of a dividend in shares
of GBS Stock) into a greater or lesser number of shares of GBS 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 B Preferred Stock shall be adjusted
by multiplying such amount by a fraction, the numerator of which is the number
of shares of GBS Stock outstanding immediately after such event and the
denominator of which is the number of shares of GBS Stock that were outstanding
immediately prior to such event.
(d) Series C Preferred Stock. A description of the
Series C Preferred Stock and a statement of its preferences, voting powers,
qualifications and special or relative rights or privileges is as follows:
(1) Dividends and Distributions.
(A) Subject to the prior and
superior rights of the holders of any shares of any series of Preferred Stock
ranking prior and superior to the Series C Preferred Stock with respect to
dividends, the holders of shares of Series C Preferred Stock, in preference to
the holders of Common Shares, 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
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 C Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1.00 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions, other than a dividend on shares of
the GMO Stock payable in shares of GMO Stock or a subdivision of the outstanding
shares of GMO Stock (by reclassification or otherwise), declared on the GMO
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 C Preferred Stock. In the event
the Corporation shall at any time after December 18, 2000 declare or pay any
dividend on any shares of GMO Stock payable in shares of GMO Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of GMO
Stock (by reclassification or otherwise than by payment of a dividend in shares
of GMO Stock) into a greater or lesser number of shares of GMO Stock, then in
each such case the amount to which holders of shares of Series C 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 GMO Stock outstanding immediately
after such event and the denominator of which is the number of shares of GMO
Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a
dividend or distribution on the Series C Preferred Stock as provided in Section
IV.G.2(d)(1)(A) immediately after it declares a dividend or distribution on any
shares of GMO Stock (other than a dividend payable in
Continuation Sheet - 41
<PAGE>
shares of GMO Stock), provided that, in the event no dividend or distribution
shall have been declared on the GMO Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend
Payment Date, a dividend of $1.00 per share on the Series C 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 C 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 C 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 C 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 C 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.
(2) Voting Rights. The holders of shares of
Series C Preferred Stock shall have the following voting rights:
(A) Subject to the provision for
adjustment hereinafter set forth, each share of Series C Preferred Stock shall
entitle the holder thereof to 100 times the number of votes to which the holder
of each outstanding share of GMO Stock is then entitled on all matters submitted
to a vote of the stockholders of the Corporation. In the event the Corporation
shall at any time after December 18, 2000 declare or pay any dividend on any
shares of GMO Stock payable in shares of GMO Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of GMO Stock (by
reclassification or otherwise than by payment of a dividend in shares of GMO
Stock) into a greater or lesser number of shares of GMO Stock, then in each such
case the number of votes per share to which holders of shares of Series C
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 GMO Stock outstanding immediately after such event and the
denominator of which is the number of shares of GMO Stock that were outstanding
immediately prior to such event.
(B) Except as otherwise provided
herein, in any vote of the Board of Directors of the Corporation creating a
series of Preferred Stock, or by law, the holders of shares of Series C
Preferred Stock and the holders of Common Shares and any other capital stock of
the Corporation having general voting rights shall vote together as one series
on all matters submitted to a vote of stockholders of the Corporation.
Continuation Sheet - 42
<PAGE>
(C) Except as set forth herein or as
otherwise provided by law, holders of Series C Preferred Stock shall have no
voting rights.
(3) 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 C Preferred Stock unless, prior thereto, the holders of shares of Series
C 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 C
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
GMO 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
C Preferred Stock, except distributions made ratably on the Series C Preferred
Stock and all other 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 after
December 18, 2000 declare or pay any dividend on any shares of GMO Stock payable
in shares of GMO Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of GMO Stock (by reclassification or otherwise than by
payment of a dividend in shares of GMO Stock) into a greater or lesser number of
shares of GMO Stock, then in each such case the aggregate amount to which
holders of shares of Series C 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 GMO Stock outstanding immediately after such event and the
denominator of which is the number of shares of GMO Stock that were outstanding
immediately prior to such event.
(4) Consolidation, Merger, Etc. In case the
Corporation shall enter into any consolidation, merger, combination or other
transaction in which Common Shares 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 C 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 GMO Stock is changed or exchanged. In
the event the Corporation shall at any time after December 18, 2000 declare or
pay any dividend on shares of GMO Stock payable in shares of GMO Stock, or
effect a subdivision or combination or consolidation of the outstanding shares
of GMO Stock (by reclassification or otherwise than by payment of a dividend in
shares of GMO Stock) into a greater or lesser number of shares of GMO 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 C Preferred Stock shall be
adjusted by multiplying such amount by a fraction, the numerator of which is the
number of shares of GMO Stock outstanding immediately after such event and the
denominator of which is the number of shares of GMO Stock that were outstanding
immediately prior to such event.
Continuation Sheet - 43
<PAGE>
(e) General Provisions. Except as otherwise
specifically provided in a particular series of Junior Preferred Stock, the
following provisions shall apply to all series of Junior Preferred Stock:
(1) Certain Restrictions.
(A) Whenever quarterly dividends or
other dividends or distributions payable on the Junior Preferred Stock are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Junior Preferred Stock
outstanding shall have been paid in full, the Corporation shall not:
(1) 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 Junior Preferred Stock;
(2) 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 Junior Preferred Stock, except dividends paid ratably on the Junior
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;
(3) 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 Junior
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 Junior Preferred Stock; or
(4) redeem, purchase or
otherwise acquire for consideration any shares of Junior Preferred Stock, or any
shares of stock ranking on a parity with the Junior 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.
(2) 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
Section IV.G.2(e)(1)(A) purchase or otherwise acquire such shares at such time
and in such manner.
(f) Reacquired Shares. Any shares of Junior
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 shares of the same
series of Preferred Stock or as part of a new series of Preferred Stock, subject
to the conditions
Continuation Sheet - 44
<PAGE>
and restrictions on issuance set forth herein, in any vote of the Board of
Directors of the Corporation creating a series of Preferred Stock, or as
otherwise required by law.
(g) Redemption. The shares of Junior Preferred Stock
shall not be redeemable.
(h) Rank. The Series A Preferred Stock, the Series B
Preferred Stock and the Series C Preferred Stock shall rank equally with respect
to the payment of dividends and the distribution of assets together with any
other series of the Corporation's Preferred Stock that specifically provide that
they shall rank equally with Junior Preferred Stock. The Junior Preferred Stock
shall rank junior with respect to the payment of dividends and the distribution
of assets to all series of the Corporation's Preferred Stock that specifically
provide that they shall rank prior to the Junior Preferred Stock. Nothing herein
shall preclude the Board from creating any series of Preferred Stock ranking on
a parity with or prior to the Junior Preferred Stock as to the payment of
dividends or the distribution of assets.
(i) Amendment. The Articles of Organization of the
Corporation shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the holders of Junior
Preferred Stock so as to affect them adversely without the affirmative vote of
the holders of at least two-thirds of each outstanding series of Junior
Preferred Stock, voting together as a single series, provided that, any two or
more series of Junior Preferred Stock that are adversely affected in the same
manner shall vote together as a single class.
(j) Fractional Shares. The Junior Preferred Stock
may be issued in fractions of a share which shall entitle the holder, in
proportion to such holder's fractional shares, to exercise voting rights,
receive dividends, participate in distributions and to have the benefit of all
other rights of holders of the Junior Preferred Stock.
ARTICLE V
The restrictions, if any, imposed by the Articles of Organization upon
the transfer of shares of stock of any class are:
NONE
Continuation Sheet - 45
<PAGE>
ARTICLE VI
** Other lawful provisions, if any, for the conduct and regulation of
the business and affairs of the corporation, for its voluntary
dissolution, or for limiting, defining, or regulating the powers of the
corporation, or of its directors or stockholders, or of any class of
stockholders:
OTHER LAWFUL PROVISIONS
A. BOARD OF DIRECTORS
1. CLASSIFICATION. The directors shall be divided into three
classes, as nearly equal in number as the then total number of directors
constituting the entire Board permits, with the term of office of one class
expiring each year. The initial directors of all classes shall be elected by the
incorporator and shall serve until their respective successors shall be elected
and shall qualify. Thereafter, the directors of the first class shall be elected
to hold office for a term expiring at the first annual meeting of stockholders,
the directors of the second class shall be elected to hold office for a term
expiring at the second annual meeting of stockholders and the directors of the
third class shall be elected to hold office for a term expiring at the third
annual meeting of stockholders. At each annual meeting of stockholders,
successors to the class of directors whose term expires at that meeting shall be
elected for a term expiring at the third annual meeting following their election
and until their successors shall be elected and qualified, subject to prior
death, resignation, retirement or removal. If the number of directors is
changed, any increase or decrease shall be apportioned among the classes so as
to maintain the number of directors in each class as nearly equal as possible,
but in no event will a decrease in the number of directors shorten the term of
any incumbent director. Notwithstanding the foregoing, and except as otherwise
required by law, whenever the holders of any one or more series of Preferred
Stock shall have the right, voting separately as a class, to elect one or more
directors of the Corporation, the election, terms of office and other features
of such directorships shall be governed by the terms of the vote establishing
such series, and such directors so elected shall not be divided into classes
pursuant to this Article VI unless express provided by such terms.
2. VACANCIES. Except as otherwise determined by the Board of
Directors in establishing a series of Preferred Stock as to directors elected by
holders of such series, any vacancies in the Board of Directors, including a
vacancy resulting from the enlargement of the Board, may be filled by the
directors then in office, though less than a quorum. Each director so chosen to
fill a vacancy shall be elected to complete the term of office of the director
who is being succeeded. In the case of any election of a new director to fill a
directorship created by an enlargement of the Board, the Board shall in such
election assign the class of directors to which such additional director is
being elected, and each director so elected shall hold office for the same term
as the other members of the class to which the director is assigned.
3. REMOVAL. Except as otherwise determined by the Board of
Directors in establishing a series of Preferred Stock as to directors elected by
holders of such series, at any special meeting of the stockholders called at
least in part for the purpose, any director or directors may, by the affirmative
vote of the holders of at least a majority of the stock entitled to
Continuation Sheet - 46
<PAGE>
vote for the election of directors, be removed from office for cause. The
provisions of this subsection shall be the exclusive method for the removal of
directors.
B. STOCKHOLDER VOTE REQUIRED FOR CERTAIN ACTIONS
The Corporation, by vote of a majority in interest of the stock
outstanding and entitled to vote thereon may (i) authorize any amendment to
these Articles of Organization, (ii) authorize the sale, lease or exchange of
all or substantially all of the Corporation's property and assets, including its
goodwill and (iii) approve a merger or consolidation of the Corporation with or
into any other corporation; so long as such amendment, sale, lease, exchange,
merger or consolidation shall have been approved by the Board of Directors.
C. ADDITIONAL PROVISIONS
1. Meetings of the stockholders may be held anywhere within
the United State.
2. No contract or other transaction of this corporation with
any other person, corporation, association, or partnership shall be affected or
invalidated by the fact that (i) this corporation is a stockholder or partner in
such other corporation, association, or partnership, or (ii) any one or more of
the officers or directors of this corporation is an officer, director or partner
of such other corporation, association or partnership, or (iii) any officer or
director of this corporation, individually or jointly with others, is a party to
or is interested in such contract or transaction. Any director of this
corporation may be counted in determining the existence of a quorum at any
meeting of the board of directors for the purpose of authorizing or ratifying
any such contract or transaction, and may vote thereon, with like force and
effect as if he were not so interested or were not an officer, director, or
partner of such other corporation, association, or partnership.
3. The corporation may be a partner in any business enterprise
which it would have power to conduct itself.
4. The by-laws may provide that the directors may make, amend,
or repeal the by-laws in whole or in part, except with respect to any provision
thereof which by law, these Articles of Organization, or the by-laws requires
action by the stockholders.
5. A director shall not be liable to the corporation or its
stockholders for monetary damages for any breach of fiduciary duty as a
director, except to the extent that the elimination or limitation of liability
is not permitted under the Massachusetts Business Corporation Law as in effect
when such liability is determined. No amendment or repeal of this provision
shall deprive a director of the benefits hereof with respect to any act or
omission occurring prior to such amendment or repeal.
6. Except as otherwise required by law, any action required or
permitted to be taken by the stockholders of the Corporation must be taken at a
duly called annual or special meeting of such holders and may not be taken by
any consent in writing by such holders.
Continuation Sheet - 47
<PAGE>
**If there are no provisions state "None".
NOTE: The preceding six (6) articles are considered to be permanent and
may ONLY be changed by filing appropriate Articles of Amendment.
ARTICLE VII
The effective date of the Restated Articles of Organization of the
corporation shall be the date approved and filed by the Secretary of
the Commonwealth. If a LATER effective date is desired, specify such
date which shall nor be more than THIRTY DAYS after the date of filing.
ARTICLE VIII
THE INFORMATION CONTAINED IN ARTICLE VIII IS NOT A PERMANENT PART OF
THE ARTICLES OF ORGANIZATION.
a. The street address (post office boxes are not acceptable) of the
principal office of the Corporation in MASSACHUSETTS is:
One Kendall Square, Cambridge, MA 02139
b. The name, residential address and post office address of each
director and officer is as follows:
<TABLE>
<CAPTION>
NAME RESIDENTIAL ADDRESS POST OFFICE ADDRESS
President:
<S> <C> <C>
Henri A. Termeer 65-3 Commercial Wharf c/o Genzyme Corporation
Boston, MA 02110 One Kendall Square
Cambridge, MA 02139
Treasurer:
Evan M. Lebson 5 Arbetter Drive same as above
Framingham, MA 01701
Clerk:
Peter Wirth 37 Hancock Street same as above
Boston, MA 02114
Directors:
Henri A. Termeer same as above same as above
Douglas A. Berthiaume 114 Cara Drive same as above
N. Andover, MA 01845
Robert J. Carpenter 9 Lowell Road same as above
Wellesley, MA 02181
Continuation Sheet - 48
<PAGE>
Victor J. Dzau 110 Dudley Road same as above
Newton, MA 02159
Constantine E.
Anagstopoulos 29 Portland Drive same as above
St. Louis, MO 63131
Henry E. Blair 2580 Main Street same as above
Barnstable, MA 02630
Charles L. Cooney 35 Chestnut Street same as above
Brookline, MA 02139
</TABLE>
c. The fiscal year (i.e. tax year) of the corporation shall end on the
last day of the month of: December
d. The name and business address of the resident agent, if any, of the
corporation is: NONE
** We further certify that the foregoing Restated Articles of
Organization affect no amendments to the Articles of Organization of
the corporation as heretofore amended, except amendments to the
following article. Briefly describe amendments below:
Article IV: (1) Undesignate each of the Genzyme Surgical Products
Division Common Stock and the Genzyme Tissue Repair Division Common
Stock as a series of common stock; (2) Designate Genzyme Biosurgery
Division Common Stock as a series of common stock; (3) Undesignate each
of the Series B Junior Participating Preferred Stock and Series D
Junior Participating Preferred Stock as a series of preferred stock;
and (4) Designate a new Series B Junior Participating Preferred Stock
as a series of preferred stock.
SIGNED UNDER THE PENALTIES OF PERJURY, this 18th day of December, 2000,
/s/ Michael S. Wyzga Senior Vice-President
----------------
/s/ Peter Wirth Clerk
-----------
Continuation Sheet - 49
<PAGE>
THE COMMONWEALTH OF MASSACHUSETTS
RESTATED ARTICLES OF ORGANIZATION
(GENERAL LAWS, CHAPTER 156B, SECTION 74)
I hereby approve the within Restated Articles Of Organization and, the
filing fee in the Amount of $_________ having been paid, said Articles
are deemed to have been filed with me This ________ day of ___________,
2000.
EFFECTIVE DATE:_____________________________
WILLIAM FRANCIS GALVIN
SECRETARY OF THE COMMONWEALTH
TO BE FILLED IN BY CORPORATION
PHOTOCOPY OF DOCUMENTS TO BE SENT TO:
PAUL LAURINO, ESQUIRE
PALMER & DODGE LLP
ONE BEACON STREET, BOSTON, MA 02108
TELEPHONE: 617/573-0510
