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EXHIBIT 3.1
ARTICLES OF AMENDMENT AND RESTATEMENT
OF THE AMENDED AND RESTATED ARTICLES OF INCORPORATION OF
EMMIS COMMUNICATIONS CORPORATION
The undersigned officer of EMMIS COMMUNICATIONS CORPORATION (the "Corporation"),
existing pursuant to the provisions of the INDIANA BUSINESS CORPORATION LAW
(IND. CODE SS. 23-1 et SEQ.), AS AMENDED (the "Act") and desiring to give notice
of corporate action effectuating amendment and restatement of certain provisions
of its Amended and Restated Articles of Incorporation, certifies the following
facts:
ARTICLE I - AMENDMENT
SECTION 1: The date of incorporation of the Corporation is:
JULY 17, 1986
SECTION 2: The name of the Corporation following this amendment and restatement
of its Amended and Restated Articles of Incorporation is:
EMMIS COMMUNICATIONS CORPORATION
SECTION 3: The text of the Amended and Restated Articles of Incorporation is
amended and restated to read as follows:
SEE ATTACHED EXHIBIT 1
This Amendment and Restatement is to be effective upon filing.
ARTICLE II-MANNER OF ADOPTION AND VOTE
SECTION 1: Action by Directors:
The Board of Directors of the Corporation duly adopted resolutions amending and
restating the Amended and Restated Articles of Incorporation. These resolutions
were adopted at a meeting duly held on February 8, 2000, at which a quorum was
present.
SECTION 2: Action by Shareholders:
The Shareholders of the Corporation entitled to vote in respect of the
amendments contained in the restatement adopted the proposed amendments by vote
of such Shareholders during a meeting called by the Board of Directors and held
on February 21, 2000. The result of such vote was as follows:
<TABLE>
<CAPTION>
Proposal 2: Proposal 3:
Proposal 1: Amendment to Amendment to
Amendment to Create Non-Voting Classify Board and
Increase Shares Common Make Other Changes
--------------- ---------- ------------------
<S> <C> <C> <C>
NUMBER OF OUTSTANDING SHARES:
CLASS A: 20,487,853 20,487,853 20,487,853
CLASS B: 2,369,291 2,369,291 2,369,291
SHARES ENTITLED TO VOTE:
CLASS A: 20,487,853 20,487,853 20,487,853
CLASS B: 2,369,291 2,369,291 2,369,291
TOTAL VOTES (1): - - 44,180,763
SHARES/VOTES REPRESENTED AT MEETING:
CLASS A: 14,944,594 14,944,594 14,944,594
CLASS B: 2,369,291 2,369,291 2,369,291
TOTAL VOTES (1): - - 38,637,504
SHARES VOTED IN FAVOR:
CLASS A: 8,635,0591 2,752,830 5,694,331
</TABLE>
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<TABLE>
<S> <C> <C> <C>
CLASS B: 2,369,291 2,369,291 2,369,291
TOTAL VOTES (1): - - 29,387,241
SHARES VOTED AGAINST:
CLASS A: 6,313,588 2,183,060 8,254,898
CLASS B: 0 0 0
TOTAL VOTES (1): - - 8,254,898
ABSTENTIONS:
CLASS A: 3,747 16,503 20,543
CLASS B: 0 0 0
</TABLE>
---------------
(1) For proposals one and two, voting was by class. For proposal three, all
shares voted as a single class and pursuant to the amended and restated
articles of incorporation, each Class A share was entitled to one vote and
each Class B share was entitled to ten votes.
SECTION 3: Compliance with legal requirements:
The manner of the adoption of the Articles of Amendment and Restatement and the
votes by which they were adopted constitute full legal compliance with the
provisions of the Act, the Amended and Restated Articles of Incorporation, and
the Code of By-Laws of the Corporation.
I hereby verify, subject to penalties for perjury, that the facts contained
herein are true this 22nd day of February, 2000.
------------------------------------------
Norman H. Gurwitz
Executive Vice President and Secretary
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EXHIBIT 1
SECOND AMENDED AND RESTATED ARTICLES OF INCORPORATION
OF
EMMIS COMMUNICATIONS CORPORATION
The Second Amended and Restated Articles of Incorporation (the "Restated
Articles") of Emmis Communications Corporation, a corporation organized and
existing under the laws of the State of Indiana (the "Corporation"), are as
follows:
ARTICLE I
Corporate Name
The name of the Corporation is Emmis Communications Corporation.
ARTICLE II
Purposes
The purpose of the Corporation is to transact any or all lawful business
for which corporations may be incorporated under the Indiana Business
Corporation Law, as now or hereafter amended (the "Act"). The Corporation shall
have the same capacity to act as possessed by natural persons and shall have and
exercise all powers granted to business corporations formed under the Act and
permitted by the laws of the State of Indiana in force from time to time
hereafter, including, but not limited to, the general rights, privileges and
powers set out in the Act, the power to enter into and engage in partnerships
and joint ventures, and to act as agent. The Corporation shall have the power
and capacity to engage in all business activities, either directly or through
any person, firm, entity, trust, partnership or association.
ARTICLE III
Definitions
As used herein, the following terms shall have the meanings indicated:
"Act" has the meaning defined in Article II.
"Affiliate of Smulyan" means (i) any person or entity that, directly or
indirectly, controls, is controlled by or is under common control with Smulyan,
(ii) any corporation or organization (other than the Corporation or a
majority-owned subsidiary of the Corporation) of which Smulyan is an officer or
partner or is, directly or indirectly, the beneficial owner of ten percent
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(10%) or more of any class of voting securities, or in which Smulyan has a
substantial beneficial interest, (iii) a Qualified Voting Trust, (iv) any other
trust or estate in which Smulyan has a substantial beneficial interest or as to
which Smulyan serves as trustee or in a similar fiduciary capacity, or (v) any
relative or spouse of Smulyan, or any relative of such spouse, who has the same
residence as Smulyan.
"Alien" has the meaning defined in Article XI.
"Alien Ownership Restrictions" has the meaning defined in Article XI.
"Board of Directors" has the meaning defined in Section 7.2(a).
"Class A Directors" has the meaning defined in Section 7.4(b).
"Class A Shares" has the meaning defined in Section 6.1(a).
"Class B Shares" has the meaning defined in Section 6.1(b).
"Class C Shares" has the meaning defined in Section 6.1(c).
"Common Shares" has the meaning defined in Section 6.1(c).
"Communications Act" has the meaning defined in Article XI.
"Corporation" has the meaning defined in the introduction to these Restated
Articles.
"Effective Date" means March 1, 1994, the date and time at which the
Corporation's Amended and Restated Articles become effective.
"Event of Automatic Conversion" means each of the automatic conversion
events described in Section 7.6(a) or Section 7.6(c).
"Existing Common Shares" has the meaning defined in Section 7.6(a).
"Going Private Transaction" shall mean any transaction that is a "Rule
13e-3 Transaction," as such term is defined in Rule 13e-3(a)(3), 17 C.F.R. ss.
240.13e-3, as amended from time to time, promulgated under the Securities
Exchange Act of 1934, as amended; provided, however, that the term "affiliate"
as used in Rule 13e-3(a)(3)(i) shall be deemed to include an Affiliate of
Smulyan.
"Independent Director" shall have the meaning defined in Part III, Section
5(c) of Schedule D to the By-Laws of the National Association of Security
Dealers, Inc., as the same may be amended from time to time.
"Preferred Stock" has the meaning defined in Section 6.1(c).
"Qualified Voting Trust" means any voting trust, voting agreement or
similar arrangement pursuant to which Smulyan generally controls the vote of the
Common Shares held by or subject to such trust, agreement or similar
arrangement, regardless of whether the
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beneficial owner reserves or is granted a limited right to vote such Common
Shares in certain circumstances. A good faith determination by the Board of
Directors as to whether a voting trust, voting agreement or similar arrangement
constitutes a Qualified Voting Trust shall be conclusive and binding on all
shareholders.
"Restated Articles" has the meaning defined in the introduction to these
Second Amended and Restated Articles of Incorporation of Emmis Communications
Corporation.
"Smulyan" means and refers to Jeffrey H. Smulyan.
ARTICLE IV
Term of Existence
The period during which the Corporation shall continue is perpetual.
ARTICLE V
Registered Office and Registered Agent
The street address of the registered office of the Corporation is 950 North
Meridian Street, Suite 1200, Indianapolis, Indiana 46204, and the name of the
registered agent at such office is Steven C. Crane.
ARTICLE VI
Capital Structure
6.1. Authorized Shares. The total number of shares of all classes of
capital stock which the Corporation shall have authority to issue is Two Hundred
Forty million (240,000,000), consisting of the following:
(a) One hundred seventy million (170,000,000) shares of Class A
Common Stock, par value $.01 per share (the "Class A Shares");
(b) Thirty million (30,000,000) shares of Class B Common Stock,
par value $.01 per share (the "Class B Shares");
(c) Thirty million (30,000,000) shares of Class C Common Stock,
par value $.01 per share (the "Class C Shares" and together with the Class A
Shares and the Class B Shares, the "Common Shares"); and
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(d) Ten million (10,000,000) shares of serial Preferred Stock,
par value $.01 per share (the "Preferred Stock").
6.2. Terms of Stock. The designations, preferences, powers, qualifications
and special or relative rights or privileges of the capital stock of the
Corporation shall be as set forth in Articles VII and VIII.
ARTICLE VII
Common Shares
7.1. Identical Rights. Except as otherwise provided in these Restated
Articles, all Common Shares shall be identical and shall entitle the holders
thereof to the same rights and privileges, including, but not limited to, the
right to share ratably in liquidation distributions after payment in full of
creditors and payment in full to any holders of Preferred Stock then outstanding
of any amount required to be paid under the terms of such Preferred Stock.
7.2. Dividends.
(a) General. When, as and if dividends are declared by the
Corporation's board of directors (the "Board of Directors"), whether payable in
cash, securities of the Corporation or other property, the holders of Common
Shares shall be entitled, in accordance with the number of Common Shares held by
each, to share equally in and to receive all such dividends, except that if
dividends are declared that are payable in Common Shares, such stock dividends
shall be payable at the same rate on each class of Common Shares and shall be
payable only in Class A Shares to holders of Class A Shares, in Class B Shares
to holders of Class B Shares and in Class C Shares to holders of Class C Shares.
(b) Record Date. Dividends declared by the Board of Directors
shall be paid to the holders of record of the outstanding Common Shares as their
names shall appear on the stock register of the Corporation on the record date
fixed by the Board of Directors in advance of declaration and payment of each
dividend.
(c) Stock Dividends. Any Common Shares issued as a dividend
shall, when so issued, be duly authorized, validly issued, fully paid and
non-assessable. The Corporation shall not issue fractions of Common Shares on
payment of any such stock dividend but shall issue a whole number of shares to
such holder of Common Shares rounded up or down in the Corporation's sole
discretion to the nearest whole number, without compensation to the stockholder
whose fractional share has been rounded down or from any stockholder whose
fractional share has been rounded up.
7.3. Stock Splits. The Corporation shall not in any manner subdivide (by
stock split, reverse stock split, reclassification, stock dividend,
recapitalization or otherwise) or combine the outstanding shares of one class of
Common Shares unless the outstanding shares of all classes of Common Shares
shall be proportionately subdivided or combined, provided that this Section
shall not apply to the reclassification taking effect upon the filing of these
Restated Articles with the Secretary of State of Indiana.
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7.4. Voting Rights.
(a) General. The holders of the Class A Shares and the Class B
Shares shall vote as a single class in all matters submitted to a vote of the
stockholders, with each Class A Share being entitled to one vote and each Class
B Share being entitled to ten votes, except (i) for the election of directors,
which shall be governed by Subsections (b) and (c) below, (ii) with respect to
any Going Private Transaction described in Subsection (e) below, which shall be
governed by such Subsection, and (iii) as otherwise provided by law. The holders
of the Class C Shares have no right to vote on any matter except as otherwise
provided by law.
(b) Class A Directors. In the election of directors, the holders
of Class A Shares shall be entitled by class vote, exclusive of all other
stockholders, to elect two of the Corporation's directors (the "Class A
Directors"), with each Class A Share entitled to one vote; provided, however,
that each Class A Director must be qualified at the time of his or her election
to be an Independent Director. Any vote by stockholders on the removal of a
Class A Director shall only be by the class vote of the holders of Class A
Shares.
(c) Other Directors. Except as provided in Subsection (b) above,
the holders of Class A Shares and Class B Shares, voting as a single class,
shall have the right to vote on the election or removal of all directors of the
Corporation (other than directors, if any, who may be elected by the holders of
Preferred Stock), with each Class A Share entitled to one vote and each Class B
Share entitled to ten votes.
(d) Class A Director Vacancies. In the event of the death,
removal or resignation of a Class A Director prior to expiration of the
director's term, the vacancy on the Board of Directors created thereby may be
filled by a majority of the directors then in office, although less than a
quorum; provided, however, that any person appointed to fill a vacancy created
by the death, removal or resignation of a Class A Director shall be an
Independent Director. A director elected in such manner to fill such a vacancy
shall hold office until the director's successor has been duly elected and
qualified at a meeting of holders of Class A Shares duly called for such
purpose.
(e) Going Private Transactions. With respect to any Going
Private Transaction between the Corporation and (i) Smulyan, (ii) any Affiliate
of Smulyan or (iii) any group of which Smulyan or any Affiliate of Smulyan is a
member, the holders of Class A Shares and Class B Shares shall vote as a single
class, with each Class A Share and Class B Share entitled to one vote.
7.5. Issuance of Common Shares. Each new issuance of Common Shares after
the Effective Date shall be an issuance of Class A Shares or Class C Shares
unless (i) the Common Shares are issued to Smulyan or (ii) the Common Shares are
issued or subject to a Qualified Voting Trust. In each event described in
clauses (i) or (ii) above, each Common Share issued shall be a Class B Share.
7.6. Conversion.
(a) Automatic Conversion on Effective Date. Each share of the
Corporation's common stock issued and outstanding immediately prior to the
Effective Date (the "Existing
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Common Shares") that is owned of record as of the Effective Date by Smulyan
shall convert automatically and without the requirement of any further action
into one fully paid and non-assessable Class B Share as of the Effective Date.
Each of the Existing Common Shares not converted in accordance with the previous
sentence shall convert automatically and without the requirement of any further
action into one fully paid and non-assessable Class A Share as of the Effective
Date.
(b) Voluntary Conversion. Each Class B Share shall be
convertible, at the option of its holder, into one fully paid and non-assessable
Class A Share at any time.
(c) Automatic Conversion.
(i) Each Class B Share shall convert automatically into one fully
paid and non-assessable Class A Share upon the sale, gift or other transfer of
such share, voluntarily or involuntarily, to a person or entity other than
Smulyan or an Affiliate of Smulyan; provided, however, that the pledge of a
Class B Share pursuant to a bona fide pledge as security for indebtedness owed
to the pledgee shall not constitute a transfer for purposes of this Subsection
(c) until such time as either (A) such share is registered in the name of the
pledgee, (B) the pledgee acquires the right to vote such share and exercises
such right, in which case the automatic conversion into a Class A Share shall be
deemed to occur immediately prior to such vote, or (C) ownership of the pledged
share is transferred pursuant to enforcement of such pledge to a person or
entity other than Smulyan or an Affiliate of Smulyan.
(ii) All Class B Shares shall convert automatically into fully
paid and non-assessable Class A Shares (on the basis of one Class A Share for
each Class B Share) upon the earlier of (A) the death of Smulyan or (B)
Smulyan's ceasing to own at least 1,520,000 Common Shares, as adjusted from time
to time to account for any stock dividend in respect of the Common Shares or any
stock split or reverse stock split of Common Shares.
(d) Voluntary Conversion Procedure. At the time of a voluntary
conversion, the holder of Class B Shares shall deliver to the office of the
Corporation or any transfer agent for the Common Shares (i) the certificate or
certificates representing the Class B Shares to be converted, duly endorsed in
blank or accompanied by proper instruments of transfer, and (ii) written notice
to the Corporation stating that such holder elects to convert such share or
shares and stating the names and addresses in which each certificate for Class A
Shares issued upon such conversion is to be issued. Voluntary conversion shall
be deemed to have been effected at the close of business on the date when such
delivery is made to the Corporation of the shares to be converted, and the
person or entity exercising such voluntary conversion shall be deemed to be the
holder of record of the number of Class A Shares issuable upon such conversion
at such time. The Corporation shall promptly deliver certificates evidencing the
appropriate number of Class A Shares to such holder.
(e) Automatic Conversion Procedure. Upon the occurrence of the
Event of Automatic Conversion pursuant to Section 7.6(a), each certificate
previously representing Existing Common Shares that pursuant to Section 7.6(a)
are converted into Class A Shares shall automatically and without the
requirement of any further action represent the same number of Class A Shares.
Promptly upon the occurrence of (i) the Event of Automatic Conversion pursuant
to Section 7.6(a) with respect to those Existing Common Shares that are
converted automatically into Class B Shares, or (ii) an Event of Automatic
Conversion pursuant to Section
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7.6(c), such that Class B Shares are converted automatically into Class A
Shares, the holder of such converted shares shall surrender the certificate or
certificates therefor, duly endorsed in blank or accompanied by proper
instruments of transfer, at the office of the Corporation or of any transfer
agent for the Common Shares and shall give written notice to the Corporation, at
such office (A) stating that the shares are being converted pursuant to an Event
of Automatic Conversion into Class B Shares or Class A Shares as provided in
Section 7.6(a) or (c), respectively, (B) specifying the Event of Automatic
Conversion (and, if the occurrence of such event is within the control of the
transferor, stating the transferor's intent to effect an Event of Automatic
Conversion), (C) identifying the number of Existing Common Shares or Class B
Shares being converted, and (D) setting out the name or names (with addresses)
and denominations in which the certificate or certificates shall be issued, and
instructions for the delivery thereof. Delivery of such notice together with the
certificates representing the converted shares shall obligate the Corporation to
issue and deliver, and thereupon the Corporation or its transfer agent shall
promptly issue and deliver, at such stated address to such holder or to the
transferee of the converted shares a certificate or certificates for the number
and class of Common Shares to which such holder or transferee is entitled,
registered in the name of such holder, the designee of such holder or transferee
as specified in such notice. Nothing contained in this Subsection (e) or
elsewhere in these Restated Articles shall be construed to permit or provide for
(i) the transfer of any Class B Shares to any person or entity other than
Smulyan or an Affiliate of Smulyan without the conversion of such Class B Shares
into Class A Shares upon such transfer or (ii) the issuance of Class B Shares to
any person or entity other than Smulyan or an Affiliate of Smulyan.
To the extent permitted by law, conversion pursuant to an Event of
Automatic Conversion shall be deemed to have been effected as of the date and
time at which the Event of Automatic Conversion occurs (such time being the
"Conversion Time"). The person or entity entitled to receive the Common Shares
issuable upon such conversion shall be treated for all purposes as the record
holder of such Common Shares at and as of the Conversion Time. The rights as a
holder of the converted shares shall cease and terminate at and as of the
Conversion Time, in each case without regard to any failure by the holder to
deliver the certificates or the notice required by this Subsection (e).
(f) Unconverted Shares; Notice Required. In the event of the
conversion of less than all of the Class B Shares evidenced by a certificate
surrendered to the Corporation in accordance with the procedures of Section
7.6(d) or (e), the Corporation shall execute and deliver to or upon the written
order of the holder of such certificate, without charge to such holder, a new
certificate evidencing the number of Class B Shares not converted. Class B
Shares shall not be transferred as Class B Shares on the books of the
Corporation unless the Corporation shall have received from the holder thereof
the written notice described herein.
(g) Reservation. The Corporation hereby reserves and shall at
all times reserve and keep available, out of its authorized and unissued Class A
Shares, for the purposes of effecting conversions, such number of duly
authorized Class A Shares as shall from time to time be sufficient to effect the
conversion of all outstanding Class B Shares. The Corporation covenants that all
the Class A Shares so issuable shall, when so issued, be duly and validly
issued, fully paid and non-assessable. Subject to Article XI, the Corporation
will take all such action as may be necessary to assure that all such Class A
Shares may be so issued without violation of any applicable law or regulation,
or of any requirements of any national securities exchange upon which the Class
A Shares may be listed.
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7.7. Consideration on Merger, Consolidation, etc. In any merger,
consolidation or business combination, the consideration to be received per
share by the holders of Class A Shares, Class B Shares and Class C Shares must
be identical for each class of stock, except that in any such transaction in
which shares of common stock are to be distributed, such shares may differ as to
voting rights to the extent that the voting rights provided in these Restated
Articles differ between the Class A Shares, the Class B Shares and the Class C
Shares.
ARTICLE VIII
Preferred Stock
8.1. Terms of Preferred Stock. The Preferred Stock may be issued from time
to time in one or more series. The Board of Directors of the Corporation shall
have authority to fix by resolution or resolutions the designations and powers,
preferences and relative participating, optional or other special rights and
qualifications, limitations or restrictions thereof, including, without
limitation, the voting rights, dividend rate, purchase or sinking funds,
provisions for redemption, conversion rights, redemption price and liquidation
preference, of any series of shares of Preferred Stock, to fix the number of
shares constituting any such series and to increase or decrease the number of
shares of any such series (but not below the number of shares thereof then
outstanding). In case the number of shares of any such series shall be so
decreased, the shares constituting such decrease shall resume the status which
they had prior to the adoption of the resolution or resolutions originally
fixing the number of shares of such series.
ARTICLE IX
Board of Directors
9.1 Number of Directors. The number of directors constituting the Board
of Directors shall be fixed by the By-Laws of the Corporation and shall be not
less than six (6) and not more than fifteen (15). No amendment to the By-Laws
decreasing the number of directors shall have the effect of shortening the term
of any incumbent director.
9.2 Classes and Term of Office. Effective as of the annual meeting of
shareholders in 2000, the Board of Directors shall be divided into three (3)
classes, designated Class I, Class II and Class III, as nearly equal in number
as possible. The number of Class A Directors in each class shall also be as
nearly equal in number as possible. The initial term of office of directors in
Class I will expire at the annual meeting of shareholders in 2001. The initial
term of office of directors in Class II will expire at the annual meeting of
shareholders in 2002. The initial term of office of directors in Class III will
expire at the annual meeting of shareholders in 2003. At each annual election
beginning at the annual meeting of shareholders in 2001, the successors to the
class of directors whose term then expires shall be elected to hold office for a
term of three (3) years and until his or her successor is elected and qualifies
or until his or her earlier resignation, removal from office or death. This
section does not apply to any directors elected pursuant to special voting
rights of one or more series of Preferred Stock.
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9.3 Removal of Directors.
(a) A director other than a Class A Director may be removed by the
shareholders only for cause and only if the removal has been approved by an 80%
majority of the combined voting power of the shares entitled to vote for the
election of such director, cast at a special meeting of the shareholders called
for that purpose. A Class A Director may be removed by the holders of Class A
Shares as provided in Section 7.4(b) only for cause and only if the removal has
been approved by the holders of an 80% majority of the Class A Shares, cast at a
special meeting of the shareholders called for that purpose. Cause for removal
exists only if:
(1) the director whose removal is proposed has been convicted of a
felony by a court of competent jurisdiction and the conviction
is no longer subject to direct appeal; or
(2) the director whose removal is proposed has been adjudicated by
a court of competent jurisdiction to be liable for negligence
or misconduct in the performance of his duty to the Corporation
in a matter of substantial importance to the Corporation, and
the adjudication is not longer subject to direct appeal.
(b) This section does not apply to any directors elected pursuant to
special voting rights of one or more series of Preferred Stock.
9.4 Amendment or Repeal of this Article. Notwithstanding any other
provision of these Articles or the By-Laws of the Corporation, and in addition
to any other procedure specified under Indiana law, any amendment or repeal of
or adoption of a provision inconsistent with any provision in this Article IX is
not effective unless it is approved by at least an 80% majority of the combined
voting power of the outstanding Common Shares.
ARTICLE X
Control Share Acquisitions
Chapter 42 of the Act (I.C. 23-1-42) shall not apply to control share
acquisitions of shares of capital stock of the Corporation.
ARTICLE XI
Alien Ownership
The following provisions are included in these Restated Articles for the
purpose of ensuring that control and management of the Corporation complies with
the Communications Act of 1934 and the rules, regulations and policies of the
Federal Communications Commission as amended from time to time (collectively,
the "Communications Act"):
(a) The Corporation (i) shall not issue to or for the account of
(A) a person who is a citizen of a country other than the United States; (B) an
entity organized under the laws
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of a government other than the government of the United States or any state,
territory, or possession of the United States; (C) a government other than the
government of the United States or of any state, territory, or possession of the
United States; or (D) a representative of, or an individual or entity controlled
by, any of the foregoing (each person or entity described in any of the
foregoing clauses (A) through (D), an "Alien") any share of capital stock of the
Corporation if such issuance would cause the total capital stock of the
Corporation held or voted by Aliens to exceed, in violation of the
Communications Act, 25% of (1) the total capital stock of the Corporation
outstanding at any time or (2) the total voting power of all shares of such
capital stock outstanding and entitled to vote at any time, and (ii) shall not
permit the transfer on the books of the Corporation of any capital stock to any
Alien that would result in the total capital stock of the Corporation held or
voted by Aliens to exceed such 25% limits in violation of the Communications
Act.
(b) No Alien or Aliens, individually or collectively, shall be
entitled to vote or direct or control the vote of more than 25% of (i) the total
capital stock of the Corporation outstanding at any time or (ii) the total
voting power of all shares of capital stock of the Corporation outstanding and
entitled to vote at any time, if to do so would violate the Communications Act.
(c) No Alien shall be qualified to act as an officer of the
Corporation and no more than one-fourth of the total number of directors of the
Corporation at any time may be Aliens, in either case if such would violate the
Communications Act.
(d) The Board of Directors shall have all powers necessary to
implement the provisions of this Article and to ensure compliance with the alien
ownership restrictions (the "Alien Ownership Restrictions") of the
Communications Act, including, without limitation, the power to prohibit the
transfer of any shares of capital stock of the Corporation to any Alien and to
take or cause to be taken such action as it deems appropriate to implement such
prohibition. Without limiting the generality of the foregoing and
notwithstanding any other provision of these Restated Articles to the contrary,
any shares of capital stock of the Corporation (other than the Series A
Preferred Stock and the Series B Preferred Stock) determined by the Board of
Directors to be owned beneficially by an Alien or Aliens shall always be subject
to redemption by the Corporation by action of the Board of Directors to the
extent necessary in the judgment of the Board of Directors to comply with the
Alien Ownership Restrictions. The terms and conditions of such redemption shall
be as follows:
(i) The redemption price of the shares to be redeemed pursuant to
this Article shall be equal to the lower of (A) the fair market value of the
shares to be redeemed, as determined in good faith by the Board of Directors in
good faith, and (B) such Alien's purchase price of such shares;
(ii) The redemption price of such shares may be paid in cash,
securities or any combination thereof;
(iii) If less than all the shares held by Aliens are to be redeemed,
the shares to be redeemed shall be selected in any manner determined by the
Board of Directors to be fair and equitable;
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<PAGE> 13
(iv) At least ten (10) days' written notice of the redemption date
shall be given to the record holders of the shares selected to be redeemed
(unless waived in writing by any such holder), provided that the redemption date
may be the date on which written notice shall be given to record holders if the
cash or securities necessary to effect the redemption shall have been deposited
in trust for the benefit of such record holders and subject to immediate
withdrawal by them upon surrender of the stock certificates for their shares to
be redeemed;
(v) From and after the redemption date, the shares to be redeemed
shall cease to be regarded as outstanding and any and all rights of the holders
in respect of the shares to be redeemed or attaching to such shares of whatever
nature (including, without limitation, any rights to vote or participate in
dividends declared on stock of the same class or series as such shares) shall
cease and terminate, and the holders thereof shall thereafter be entitled only
to receive the cash or securities payable upon redemption; and
(vi) Such other terms and conditions as the Board of Directors shall
determine.
For purposes of this Article, the determination of the beneficial ownership of
shares of capital stock of the Corporation shall be made pursuant to Rule 13d-3,
17 C.F.R. ss. 240.13d-3, as amended from time to time, promulgated under the
Securities Exchange Act of 1934, as amended, or in such other manner as
determined in good faith by the Board of Directors to be fair and equitable.
ARTICLE XII
Indemnification
12.1. General. The Corporation shall, to the fullest extent to which it is
empowered to do so by the Act, or any other applicable laws, as from time to
time in effect, indemnify any person who was or is a party, or is threatened to
be made a party, to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative and whether
formal or informal, by reason of the fact that such person is or was a director
or officer of the Corporation, or who, while serving as such a director or
officer of the Corporation, is or was serving at the request of the Corporation
as a director, officer, partner, trustee, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise, whether for profit or not, against expenses (including counsel
fees), judgments, settlements, penalties and fines (including excise taxes
assessed with respect to employee benefit plans) actually or reasonably incurred
by such person in accordance with such action, suit or proceeding, if such
person acted in good faith and in a manner he or she reasonably believed, in the
case of conduct in his or her official capacity, was in the best interests of
the Corporation, and in all other cases, was not opposed to the best interests
of the Corporation, and, with respect to any criminal action or proceeding, such
person either had reasonable cause to believe his or her conduct was lawful or
no reasonable cause to believe his or her conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement or conviction,
or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the person did not meet the prescribed standard of
conduct.
12.2. Authorization of Indemnification. To the extent that a director or
officer of the Corporation has been wholly successful, on the merits or
otherwise, in the defense of any action,
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<PAGE> 14
suit or proceeding referred to in Section 12.1, or in the defense of any claim,
issue or matter therein, the Corporation shall indemnify such person against
expenses (including counsel fees) actually and reasonably incurred by such
person in connection therewith. Any other indemnification under Section 12.1
(unless ordered by a court) shall be made by the Corporation only as authorized
in the specific case, upon a determination that indemnification of the director
or officer is permissible in the circumstances because he or she has met the
applicable standard of conduct. Such determination shall be made (i) by the
Board of Directors by a majority vote of a quorum consisting of directors who
were not at the time parties to such action, suit or proceeding; or (ii) if a
quorum cannot be obtained under clause (i), by a majority vote of a committee
duly designated by the Board of Directors (in which designation directors who
are parties may participate), consisting solely of two or more directors not at
the time parties to such action, suit or proceeding; or (iii) by special legal
counsel (A) selected by the Board of Directors or its committee in the manner
prescribed in clauses (i) or (ii), or (B) if a quorum of the Board of Directors
cannot be obtained under clause (i) and a committee cannot be designated under
clause (ii), selected by a majority vote of the full Board of Directors (in
which selection directors who are parties may participate); or (iv) by the
stockholders, but shares owned by or voted under the control of directors or
officers who are at the time parties to such action, suit or proceeding may not
be voted on the determination.
Authorization of indemnification and evaluation as to reasonableness of
expenses shall be made in the same manner as the determination that
indemnification is permissible, except that if the determination is made by
special legal counsel, authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled under foregoing
clause (iii) to select counsel.
12.3. Good Faith. For purposes of any determination under Section 12.1, a
person shall be deemed to have acted in good faith and to have otherwise met the
applicable standard of conduct set forth in Section 12.1 if his or her action is
based on information, opinions, reports, or statements, including financial
statements and other financial data, if prepared or presented by (i) one or more
officers or employees of the Corporation or other enterprise whom he or she
reasonably believes to be reliable and competent in the matters presented; (ii)
legal counsel, public accountants, appraisers or other persons as to matters he
or she reasonably believes are within the person's professional or expert
competence; or (iii) a committee of the Board of Directors of the Corporation or
other enterprise of which the person is not a member if he or she reasonably
believes the committee merits confidence. The term "other enterprise" as used in
this Section 12.3 shall mean any other corporation or any partnership, joint
venture, trust, employee benefit plan or other enterprise of which such person
is or was serving at the request of the Corporation as a director, partner,
trustee, employee or agent. The provisions of this Section 12.3 shall not be
exclusive or limit in any way the circumstances in which a person may be deemed
to have met the applicable standards of conduct set forth in Section 12.1.
12.4. Payment of Expenses in Advance. Expenses incurred in connection with
any civil or criminal action, suit or proceeding may be paid for or reimbursed
by the Corporation in advance of the final disposition of such action, suit or
proceeding, as authorized in the specific case in the same manner described in
Section 12.2, upon receipt of the director or officer's written affirmation of
his or her good faith belief that he or she has met the standard of conduct
described in Section 12.1 and upon receipt of a written undertaking by or on
behalf of the director or officer to repay such amount if it shall ultimately be
determined that he or she did not meet the standard of conduct set forth in this
Article XII, and a determination is made that the
12
<PAGE> 15
facts then known to those making the determination would not preclude
indemnification under this Article XII.
12.5. Other Indemnitees. The Corporation may, by action of its Board of
Directors, indemnify employees and agents of the Corporation with the same scope
and effect and pursuant to the same procedures as provided in this Article XII
for directors and officers.
12.6. Provisions Not Exclusive. The indemnification provided by this
Article shall not be deemed exclusive of any other rights to which a person
seeking indemnification may be entitled under these Restated Articles of
Incorporation, the Corporation's By-Laws, any resolution of the Board of
Directors or stockholders, any other authorization, whenever adopted, after
notice, by a majority vote of all voting shares of the Corporation then
outstanding, or any contract, both as to action in his or her official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to serve in his or her official capacity,
and shall inure to the benefit of the heirs, executors and administrators of
such a person.
12.7. Vested Right to Indemnification. The right of any person to
indemnification under this Article shall vest at the time of occurrence or
performance of any event, act or omission giving rise to any action, suit or
proceeding of the nature referred to in Section 12.1 and, once vested, shall not
later be impaired as a result of any amendment, repeal, alteration or other
modification of any or all of these provisions. Notwithstanding the foregoing,
the indemnification afforded under this Article shall be applicable to all
alleged prior acts or omissions of any individual seeking indemnification
hereunder, regardless of the fact that such alleged acts or omissions may have
occurred prior to the adoption of this Article. To the extent such prior acts or
omissions cannot be deemed to be covered by this Article XII, the right of any
person to indemnification shall be governed by the indemnification provisions in
effect at the time of such prior acts or omissions.
12.8. Insurance. The Corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
Corporation, or who is or was serving at the request of the Corporation as a
director, officer, partner, trustee, employee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise,
against any liability asserted against or incurred by the individual in that
capacity or arising from the individual's status as a director, officer,
employee or agent, whether or not the Corporation would have power to indemnify
the individual against the same liability under this Article.
12.9. Additional Definitions. For purposes of this Article:
(i) References to the "Corporation" shall include any domestic or
foreign predecessor entity of the Corporation in a merger or other transaction
in which the predecessor's existence ceased upon consummation of the
transaction.
(ii) Serving an employee benefit plan at the request of the
Corporation shall include any service as a director, officer, employee or agent
of the Corporation which imposes duties on, or involves services by such
director, officer, employee, or agent with respect to an employee benefit plan,
its participants, or beneficiaries. A person who acted in good faith and in a
manner he reasonably believed to be in the best interests of the participants
and beneficiaries of
13
<PAGE> 16
an employee benefit plan shall be deemed to have acted in a manner "not opposed
to the best interest of the Corporation" referred to in this Article.
(iii) The term "party" includes any individual who is or was a
plaintiff, defendant or respondent in any action, suit or proceeding, or who is
threatened to be made a named defendant or respondent in any action, suit or
proceeding.
(iv) The term "official capacity," when used with respect to a
director, shall mean the office of director of the Corporation; and when used
with respect to an individual other than a director, shall mean the office in
the Corporation held by the officer or the employment or agency relationship
undertaken by the employee or agent on behalf of the Corporation. "Official
capacity" does not include service for any other foreign or domestic corporation
or any partnership, joint venture, trust, employee benefit plan, or other
enterprise, whether for profit or not.
ARTICLE XIII
Severability
In the event that any Article or Section (or portion thereof) of these
Restated Articles shall be found to be invalid, prohibited or unenforceable for
any reason, the remaining provisions, or portion thereof, of these Restated
Articles shall be deemed to remain in full force and effect, and shall be
construed as if such invalid, prohibited or unenforceable provision had been
stricken herefrom or otherwise rendered inapplicable, it being the intent of the
Corporation and its stockholders that each such remaining provision (or portion
thereof) of these Restated Articles remain, to the fullest extent permitted by
law, applicable and enforceable as to all stockholders notwithstanding any such
findings.
14
<PAGE> 17
EXHIBIT A
EXHIBIT A
TO THE SECOND AMENDED AND RESTATED
ARTICLES OF INCORPORATION OF
EMMIS COMMUNICATIONS CORPORATION
Pursuant to the authority expressly granted to and vested in the Board of
Directors of the Corporation by the provisions of Article VIII, Section 8.01 of
the Corporation's Amended and Restated Articles of Incorporation, as amended
from time to time (the "Articles of Incorporation"), and pursuant to I.C.
23-1-25-2, the Board of Directors hereby creates a series of preferred stock of
the Corporation with the following voting powers, designations, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations or restrictions thereof (in addition to the provisions set forth in
the Articles of Incorporation which are applicable to the preferred stock of all
classes and series):
1. Designation, Amount and Ranking.
1.1 There shall be created from the 10,000,000 shares of
preferred stock, par value $0.01 per share, of the Corporation authorized to be
issued pursuant to the Articles of Incorporation, a series of preferred stock,
designated as the "6.25% Series A Cumulative Convertible Preferred Stock," par
value $0.01 per share (the "Preferred Stock"), and the number of shares of such
series shall be 2,875,000. Such number of shares may be decreased by resolution
of the Board of Directors; provided that no decrease shall reduce the number of
shares of Preferred Stock to a number less than that of the shares of Preferred
Stock then outstanding plus the number of shares issuable upon exercise of
options or rights then outstanding and, if any portion of the over-allotment
option granted by the Corporation pursuant to the Purchase Agreement (as defined
in this Exhibit A) expires unexercised, the Board of Directors shall by
resolution decrease the number of authorized shares of Preferred Stock by the
number of shares subject to the expired portion of such over-allotment option.
Any shares of Preferred Stock issued after the Issue Date (as defined in this
Exhibit A) pursuant to the over-allotment option granted by the Corporation
pursuant to the Purchase Agreement shall, for all purposes, including, without
limitation, voting and dividend rights, be deemed issued as of the Issue Date.
1.2 The Preferred Stock, with respect to dividend distributions
upon the liquidation, winding-up and dissolution of the Corporation, ranks:
(a) senior to all classes of the Corporation's common
stock and to each other class of capital stock or series of preferred stock
established after the Issue Date by the Board of Directors, the terms of which
do not expressly provide that it ranks senior to or on a parity with the
Preferred Stock as to dividend distributions and distributions upon the
liquidation, winding-up and dissolution of the Corporation;
(b) ratably with any class of capital stock or series of
preferred stock issued by the Corporation established after the Issue Date by
the Board of Directors, the terms of which expressly provide that such class or
series will rank on a parity with the Preferred Stock as to dividend
distributions and distributions upon the liquidation, winding-up and dissolution
of the Corporation; and
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<PAGE> 18
(c) subject to certain conditions which include the
affirmative vote or consent of the holders of at least 66 2/3% of the
outstanding Preferred Stock, junior to each class of capital stock or series of
preferred stock issued by the Corporation established after the Issue Date by
the Board of Directors, the terms of which expressly provide that such class or
series will rank senior the Preferred Stock as to dividend distributions and
distributions upon liquidation, winding-up and dissolution of the Corporation.
2. Definitions. As used in this Exhibit A, the following terms shall
have the following meanings:
2.1 "Accrued Dividends" shall mean, with respect to any share of
Preferred Stock, as of any date, the accrued and unpaid dividends on such share
from and including the most recent Dividend Payment Date (or the Issue Date, if
such date is prior to the first Dividend Payment Date) to but not including such
date. "Accumulated Dividends" shall mean, with respect to any share of Preferred
Stock, as of any date, the aggregate accumulated and unpaid dividends on such
share from the Issue Date until the most recent Dividend Payment Date prior to
such date. There shall be no Accumulated Dividends with respect to any share of
Preferred Stock prior to the first Dividend Payment Date.
2.2 "Business Day" shall mean any day other than a Saturday,
Sunday or other day on which commercial banks in The City of New York are
authorized or required by law or executive order to close.
2.3 "Change of Control" shall mean any of the following events:
(i) the sale, lease or transfer, in one or a series of related transactions, of
all or substantially all of the Corporation's assets to any "person or group,"
as such terms are used in Section 13(d)(3) of the Exchange Act other than to
Permitted Holders; (ii) the adoption of a plan relating to the liquidation or
dissolution of the Corporation; (iii) the acquisition, directly or indirectly,
by any person or group, as such terms are used in Section 13(d)(3) of the
Exchange Act as in effect on the original date of issuance of the Preferred
Stock, other than Permitted Holders, of beneficial ownership (as defined in Rule
13d-3 under the Exchange Act as in effect on the original date of issuance of
the convertible preferred stock, except that a person will be deemed to have
beneficial ownership of all shares that any such person has the right to
acquire, whether such right is exercisable immediately or only after passage of
time) of more than 50% of the Corporation's total outstanding voting stock;
provided, however, that the Permitted Holders beneficially own (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the issue date),
directly or indirectly, in the aggregate a lesser percentage of the total voting
power of the Corporation's voting stock than such other person and do not have
the right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the Corporation's Board of Directors; or
(iv) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Corporation's Board of Directors,
together with any new directors whose election by such Board of Directors or
whose nomination for election by the Corporation's shareholders was approved by
a vote of 66 2/3% of the Corporation's Board of Directors then still in office
who were either directors at the beginning of such period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority of the Corporation's Board of Directors then in office.
2.4 "Change of Control Date" shall mean the date on which the
Change of Control event occurs.
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<PAGE> 19
2.5 "Conversion Price" shall mean $78.125, subject to adjustment
as set forth in Section 9(c).
2.6 "Class A Common Stock" shall mean the Class A Common Stock,
par value $0.01 per share, of the Corporation, or any other class of stock
resulting from successive changes or reclassifications of such common stock
consisting solely of changes in par value, or from par value to no par value, or
as a result of a subdivision, combination, or merger, consolidation or similar
transaction in which the Corporation is a constituent corporation.
2.7 "Class B Common Stock" shall mean the Class B Common Stock
par value $0.01 per share, of the Corporation.
2.8 "Common Stock" shall mean both the Class A Common Stock and
the Class B Common Stock of the Corporation.
2.9 "Dividend Payment Date" shall mean January 15, April 15,
July 15 and October 15 of each year, commencing January 15, 2000.
2.10 "Dividend Record Date" shall mean, with respect to each
Dividend Payment Date, a date not more than 60 days nor less than 10 days
preceding a Dividend Payment Date, as may be fixed by the Board of Directors.
2.11 "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
2.12 "Issue Date" shall mean October 26, 1999, the original date
of issuance of the Preferred Stock.
2.13 "Liquidation Preference" shall mean, with respect to each
share of Preferred Stock, $50.
2.14 "Market Capitalization" shall mean as of a given date the
product of the Market Value so of such date times the total number of shares of
Common Stock outstanding as of such date.
2.15 "Market Value" shall mean as of a given date the average
closing price of the Class A Common Stock for a ten consecutive trading day
period, ending on the last trading day immediately preceding such date, on the
Nasdaq Stock Market or any national securities exchange or authorized quotation
system on which the Corporation's Class A Common Stock is listed or authorized
for quotation, or if the Class A Common Stock is not so listed or authorized for
quotation, an amount determined in good faith by the Board of Directors to be
the fair value of the Class A Common Stock.
2.16 "Permitted Holders" means Jeffrey H. Smulyan, his spouse,
lineal descendants and ascendants, heirs, executors or other legal
representatives and any trusts or other entities established by or for the
benefit of any of the foregoing or established by any of the foregoing for
charitable purposes, or any other person or entity in which the foregoing
persons or entities exercise control.
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<PAGE> 20
2.17 "Person" shall mean any individual, corporation, general
partnership, limited partnership, limited liability partnership, joint venture,
association, joint-stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
2.18 "Purchase Agreement" shall mean that certain Purchase
Agreement with respect to the Preferred Stock, dated as of October 26, 1999
among the Corporation, Donaldson, Lufkin & Jenrette Securities Corporation and
Goldman, Sachs & Co.
3. Dividends.
3.1 The holders of shares of the outstanding Preferred Stock
shall be entitled, when, as and if declared by the Board of Directors out of
funds legally available therefor, to receive cumulative annual cash dividends at
a rate per annum equal to 6.25% (the "Dividend Rate") of the Liquidation
Preference, payable quarterly in arrears. Dividends payable for each full
dividend period will be computed by dividing the Dividend Rate by four and shall
be payable in arrears on each Dividend Payment Date for the quarterly period
ending immediately prior to such Dividend Payment Date, to the holders of record
of Preferred Stock at the close of business on the Dividend Record Date
applicable to such Dividend Payment Date. Such dividends shall be cumulative
from the Issue Date and shall accrue on a day-to-day basis, whether or not
earned or declared, from and after the Issue Date. Dividends on the Preferred
Stock which are not declared and paid when due will compound quarterly on each
Dividend Payment Date at the Dividend Rate. Dividends payable for any partial
dividend period shall be computed on the basis of actual days elapsed over a
360-day year consisting of twelve 30-day months. Notwithstanding anything in
this Exhibit A to the contrary, the initial Dividend Payment Date, which shall
be for dividends accrued during the period commencing on the Issue Date and
ending on January 15, 2000, will be January 15, 2000.
3.2 Dividends paid on the Preferred Stock shall be payable in
cash.
3.3 No dividends or other distributions (other than a dividend
or distribution payable solely in stock of the Corporation ranking junior to or
ratably with the Preferred Stock as to dividends and upon liquidation,
dissolution or winding up and cash in lieu of fractional shares) may be
declared, made or paid or set apart for payment on the Common Stock or upon any
other stock of the Corporation ranking junior to or ratably with the Preferred
Stock as to dividends, and no Common Stock or any other stock of the Corporation
ranking junior to or ratably with the Preferred Stock as to dividends or upon
liquidation, dissolution or winding up, may be redeemed, purchased or otherwise
acquired for any consideration (or any money paid to or made available for a
sinking fund for the redemption of any shares of any such stock) by the
Corporation (except by conversion into or exchange for stock of the Corporation
ranking junior to or ratably with the Preferred Stock as to dividends and upon
liquidation dissolution or winding up), unless full Accumulated Dividends shall
have been or contemporaneously are paid or declared and a sum sufficient for the
payment thereof is set apart for such payment on the Preferred Stock for all
Dividend Payment Periods terminating on or prior to the date of such
declaration, payment, redemption, purchase or acquisition. Notwithstanding the
foregoing, if full dividends have not been paid to the holders of the Preferred
Stock and on any other preferred stock ranking ratably with the Preferred Stock
as to dividends, dividends may be declared and paid on the Preferred Stock and
such other ratable preferred stock, only so long as the dividends are declared
and paid
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<PAGE> 21
pro rata so that the amounts of dividends declared per share on the Preferred
Stock and such other ratable preferred stock will in all cases bear to each
other the same ratio that, immediately prior to payment of the dividend on such
other ratable stock, Accumulated and Accrued Dividends per share of the
Preferred Stock and accrued and unpaid dividends per share of such other ratable
preferred stock bear to each other.
3.4 Holders of shares of Preferred Stock shall not be entitled
to any dividends on the Preferred Stock, whether payable in cash, property or
stock in excess of full cumulative dividends at the Dividend Rate provided in
this Exhibit A. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments on the Preferred Stock
which may be in arrears.
3.5 The holders of shares of Preferred Stock at the close of
business on a Dividend Record Date will be entitled to receive the dividend
payment on those shares (except that holders of shares called for redemption on
a redemption date between the Dividend Record Date and the Dividend Payment Date
will be entitled to receive such dividend on such redemption date on the
corresponding Dividend Payment Date notwithstanding the subsequent conversion
thereof or the Corporation's default in payment of the dividend due on that
Dividend Payment Date.
4. Optional Redemption.
4.1 The Preferred Stock is not subject to any sinking fund or
other similar provisions. From April 15, 2001 to October 15, 2002, the
Corporation may redeem Preferred Stock (the "Provisional Redemption") at a
redemption premium equal to 104.911% of the Liquidation Preference plus
Accumulated Dividends, if any, whether or not declared to the redemption date
(the "Provisional Redemption Date"), if the closing price of the Corporation's
Class A Common Stock on the Nasdaq Stock Market, or any national securities
exchange or authorized quotation system on which the Corporation's Class A
Common Stock is then listed or authorized for quotation, if not so listed, is
greater than 150% of the Conversion Price ($117.1875), as hereafter defined in
this Exhibit A, per share for 20 trading days within any 30 consecutive trading
day period. If the Corporation undertakes a Provisional Redemption, holders of
Preferred Stock that the Corporation calls for redemption will also receive a
payment (the "Additional Payment") in an amount equal to the present value of
the aggregate value of the dividends (whether or not declared) that would
thereafter have been payable on the Preferred Stock called for redemption from
the Provisional Redemption Date to October 15, 2002 (the "Additional Period").
The present value will be calculated using as the discount rate the bond
equivalent yield on U.S. Treasury notes or bills having the term nearest in
length to that of the Additional Period, calculated as of the day immediately
preceding the date on which a notice of Provisional Redemption is mailed. The
Corporation will be obligated to make the Additional Payment on all shares of
Preferred Stock that the Corporation has called for the Provisional Redemption
whether or not those shares of Preferred Stock that the Corporation has called
are converted prior to the Provisional Redemption Date.
4.2 Beginning on October 15, 2002, the Corporation may redeem in
cash the Preferred Stock, during the twelve-month periods commencing on October
15 of the years indicated below, at the following redemption premiums (which are
expressed as a percentage of the stated liquidation preference of $50 per
share), plus in each case Accrued Dividends and Accumulated Dividends, if any,
whether or not declared to the redemption date:
A-5
<PAGE> 22
<TABLE>
<CAPTION>
Year Amount
---- ------
<S> <C>
2002................. 103.571%
2003................. 102.679%
2004................. 101.786%
2005................. 100.893%
2006................. 100.000%
</TABLE>
5. Procedure for Redemption.
5.1 Not less than 30 nor more than 60 days previous to the date
fixed for redemption by the Board of Directors, a notice specifying the time and
place thereof shall be given to the holders of record of the Preferred Stock to
be redeemed by first class mail at their respective addresses as the same shall
appear on the books of the Corporation; provided, however, that no failure to
mail such notice, nor any defect therein, nor in the mailing thereof, shall
affect the validity of the proceedings for the redemption of any of the
Preferred Stock to be redeemed. Upon the redemption date, the Corporation shall
pay over the redemption price to the holders of the shares upon the endorsement
and surrender of the certificates for such shares by the holders of the
Preferred Stock.
5.2 On or before any redemption date, each holder of shares of
Preferred Stock to be redeemed shall surrender the certificate or certificates
representing such shares of Preferred Stock to the Corporation, in the manner
and at the place designated in the notice of redemption and on the redemption
date, the full redemption price, payable in cash, for such shares of Preferred
Stock shall be paid or delivered to the person whose name appears on such
certificate or certificates as the owner thereof, and the shares represented by
each surrendered certificate shall be returned to authorized but unissued shares
of preferred stock of any or no series. Upon surrender (in accordance with the
notice of redemption) of the certificate or certificates representing any shares
to be so redeemed (properly endorsed or assigned for transfer, if the
Corporation shall so require and the notice of redemption shall so state), such
shares shall be redeemed by the Corporation at the redemption price. If fewer
than all the shares represented by any such certificate are to be redeemed, a
new certificate shall be issued representing the unredeemed shares, without
costs to the holder thereof, together with the amount of cash, if any, in lieu
of fractional shares.
5.3 If a notice of redemption shall have been given as provided
in Section 5.1, dividends on the shares of Preferred Stock so called for
redemption shall cease to accrue, such shares shall no longer be deemed to be
outstanding, and all rights of the holders thereof as stockholders of the
Corporation with respect to shares so called for redemption (except for the
right to receive from the Corporation the redemption price) shall cease
(including any right to receive dividends otherwise payable on any Dividend
Payment Date that would have occurred after the time and date of redemption)
either (i) from and after the time and date fixed in the notice of redemption as
the time and date of redemption (unless the Corporation shall default in the
payment of the redemption price, in which case such rights shall not terminate
at such time and date) or (ii) if the Corporation shall so elect and state in
the notice of redemption, from and after the time and date (which date shall be
the date fixed for redemption or an earlier date not less than 30 days after the
date of mailing of the redemption notice) on which the Corporation shall
irrevocably deposit in trust for the holders of the shares of Preferred Stock to
be redeemed
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with a designated bank or trust company doing business in the State of New York,
as paying agent, money sufficient to pay at the office of such paying agent, on
the redemption date, the redemption price. Any money so deposited with any such
paying agent which shall not be required for such redemption shall be returned
to the Corporation forthwith. Subject to applicable escheat laws, any moneys so
set aside by the Corporation and unclaimed at the end of one year from the
redemption date shall revert to the general funds of the Corporation, after
which reversion the holders of such shares so called for redemption shall look
only to the general funds of the Corporation for the payment of the redemption
price without interest. Any interest accrued on funds so deposited shall be paid
to the Corporation from time to time.
5.4 In the event that fewer than all the outstanding shares of
the Preferred Stock are to be redeemed, the shares to be redeemed will be
determined pro rata or by lot. From and after the applicable redemption date,
unless the Corporation defaults in the payment of the redemption price,
dividends on the shares of Preferred Stock to be redeemed on such redemption
date will cease to accrue, said shares will no longer be deemed to be
outstanding, and all rights of the holders thereof as the Corporation's
shareholders (except the right to receive the redemption price) will cease.
5.5 The Corporation shall not redeem any shares of Preferred
Stock if any dividends on the Preferred Stock are in arrears unless all
dividends on the Preferred Stock in arrears are paid in full.
6. Change of Control.
6.1 Upon the occurrence of a Change of Control of the
Corporation, holders of Preferred Stock will, if the Market Value as of the
Change of Control Date is less than the Conversion Price, have a one-time option
(the "Change of Control Option") to convert all of their outstanding shares of
Preferred Stock into shares of the Corporation's Class A Common Stock at a
conversion price equal to the greater of (i) the Market Value as of the Change
of Control Date; or (ii) 66.67% of the market price per share of the
Corporation's Class A Common Stock at the close of trading on the date of
issuance of the Preferred Stock. The Change of Control Option will be
exercisable during a period of not less than 30 days nor more than 60 days
commencing on the third business day after notice of the Change of Control is
given by the Corporation. In lieu of issuing the shares of the Corporation's
Class A Common Stock issuable upon conversion in the event of a Change of
Control, the Corporation may, at its option, make a cash payment equal to the
Market Value as of the Change of Control Date of such Class A Common Stock
otherwise issuable.
6.2 In the event of a Change of Control, notice of such Change
of Control shall be given, within five Business Days of the Change of Control
Date, by the Corporation by first class mail to each record holder of shares of
Preferred Stock, at such holder's address as the same appears on the books of
the Corporation. Each such notice shall state (i) that a Change of Control has
occurred; (ii) the last day on which the Change of Control Option may be
exercised (the "Expiration Date"); (iii) the name and address of the paying
agent; and (iv) the procedures that holders must follow to exercise the Change
of Control Option.
6.3 On or before the Expiration Date, each holder of shares of
Preferred Stock wishing to exercise the Change of Control Option shall surrender
the certificate or certificates representing the shares of Preferred Stock to be
converted, in the manner and at the place
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designated in the notice described in Section 6.2, and on such date the cash or
shares of Class A Common Stock due to such holder shall be delivered to the
person whose name appears on such certificate or certificates as the owner
thereof and each surrendered certificate shall be returned to authorized but
unissued shares. Upon surrender (in accordance with the notice described in
Section 6.2) of the certificate or certificates representing any shares to be so
converted (properly endorsed or assigned for transfer, if the Corporation shall
so require and the notice shall so state), such shares shall be converted by the
Corporation at the Conversion Price.
6.4 The rights of holders of Preferred Stock pursuant to this
Section 6 are in addition to, and not in lieu of, the rights of holders of
Preferred Stock provided for in Section 9 in this Exhibit A.
7. Voting.
7.1 The shares of Preferred Stock shall have no voting rights
except as required by law or as set forth in this Section 7. increase or
decrease the aggregate number of authorized shares of the class of preferred
stock;
7.2 If the dividends payable on the Preferred Stock are in
arrears for six consecutive quarterly periods, the holders of Preferred Stock
voting separately as a class with the shares of any other preferred stock or
preference securities having similar voting rights will be entitled at the next
regular or special meeting of the Corporation's shareholders to elect two
directors to the Corporation's Board of Directors. Such voting rights and terms
of the directors so elected continue until such time as the dividend arrearage
on the Preferred Stock has been paid in full.
7.3 The affirmative vote or consent of the holders of at least
66 2/3% of the outstanding Preferred Stock will be required for the issuance of
any class or series of stock, or security convertible into the Corporation's
stock, ranking senior to the Preferred Stock as to dividends, liquidation rights
or voting rights and for amendments to the Corporation's Articles of
Incorporation that would adversely affect the rights of holders of the Preferred
Stock; provided, however, that any issuance of shares of preferred stock which
rank ratably with the Preferred Stock (including the issuance of additional
shares of the Preferred Stock) will not, by itself, be deemed to adversely
affect the rights of the holders of the Preferred Stock. In all such cases, each
share of Preferred Stock will be entitled to one vote.
8. Liquidation Rights.
8.1 In the event of any dissolution, voluntary or involuntary
liquidation or winding-up of the Corporation, the holders of the shares of
Preferred Stock shall be entitled to receive and to be paid out of the assets of
the Corporation available for distribution to stockholders, before any payment
or distribution is made to holders of the Corporation's Common Stock or any
other class or series of stock of the Corporation ranking junior to the
Preferred Stock upon liquidation, the Liquidation Preference plus Accumulated
Dividends, if any, with respect to each share.
8.2 Neither the sale, conveyance, exchange or transfer (for
cash, shares of stock, securities or other consideration) of all or
substantially all the property and assets of the Corporation nor the merger or
consolidation of the Corporation into or with any other
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corporation, or the merger or consolidation of any other corporation into or
with the Corporation, shall be deemed to be a dissolution, voluntary or
involuntary liquidation or winding up, for the purposes of this Section 8.
8.3 After the payment to the holders of the shares of
Preferred Stock of full preferential amounts provided for in this Section 8, the
holders of Preferred Stock as such shall have no right or claim to any of the
remaining assets of the Corporation.
8.4 If upon any voluntary or involuntary dissolution,
liquidation or winding up of the Corporation, the amounts payable with respect
to the Liquidation Preference and Accumulated Dividends on the Preferred Stock
and any other shares of the Corporation's stock ranking as to any distribution
ratably with the Preferred Stock are not paid in full, the holders of the
Preferred Stock and of such other shares will share pro rata in proportion to
the Liquidation Preference plus Accumulated Dividends thereon.
9. Conversion.
(a) Subject to compliance with the provisions of this
Section 9, each outstanding share of the Preferred Stock shall be convertible at
any time at the option of the holder into that number of whole shares of the
Corporation's Class A Common Stock as is equal to the Liquidation Preference,
divided by an initial conversion price of $78.125, equivalent to 0.6400 shares
of Class A Common Stock per share of Preferred Stock, subject to adjustment as
described in Section 9(c). The initial conversion price and the conversion price
as adjusted are referred to in this Exhibit A as the Conversion Price. A share
of Preferred Stock called for redemption will be convertible into shares of
Class A Common Stock up to and including, but not after, the close of business
on the date fixed for redemption unless the Corporation defaults in the payment
of the amount payable upon redemption.
To exercise the conversion right, the holder of each share of
Preferred Stock to be converted shall surrender the Certificate representing
such share, if certificated, duly endorsed or assigned to the Corporation or in
blank, at the office of the transfer agent, together with written notice of the
election to convert executed by the holder (the "Conversion Notice") specifying
the number of shares of Preferred Stock to be converted, the name in which the
shares of Class A Common Stock deliverable upon conversion shall be registered,
and the address of the named person. If the shares of Preferred Shares are not
certificated, the holder must deliver evidence of ownership satisfactory to the
Corporation and the transfer agent. Unless the shares of Class A Common Stock
deliverable upon conversion are to be issued in the same name as the name in
which the shares of Preferred Stock to be converted are registered, the holder
must also deliver to the transfer agent an instrument of transfer, in form
satisfactory to the Corporation, duly executed by the holder or the holder's
duly authorized attorney, together with an amount sufficient to pay any transfer
or similar tax in connection with the issuance and delivery of such shares of
Class A Common Stock in such name (or evidence reasonably satisfactory to the
Corporation demonstrating that such taxes have been paid).
As promptly as practicable after compliance with the
provisions of the foregoing paragraph, the Corporation shall deliver or cause to
be delivered at the office where such certificates are surrendered to or upon
the written order of the holder thereof a certificate or certificates
representing the number of shares of Class A Common Stock into which such
Preferred Stock may be converted in accordance with the provisions of this
Section 9, registered
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in such name or names as are duly specified in the Conversion Notice. Such
conversion shall be deemed to have been effected at the close of business on the
date the holder has complied with the provisions of the foregoing paragraph, and
the rights with respect to the shares of Preferred Stock so converted, including
the rights, if any, to receive notices, will terminate at that time, except only
(i) the rights of holders of such shares of Preferred Stock to receive
certificates for the number of shares of Class A Common Stock into which such
shares of Preferred Stock have been converted; and (ii) the right of holders of
such shares of the Preferred Stock at the close of business on a Dividend Record
Date to receive, on the corresponding Dividend Payment Date, the dividend
declared on such shares for payment on such Dividend Payment Date.
If the last day for the exercise of the conversion right shall
not be a Business Day, then such conversion right may be exercised on the next
preceding Business Day.
(b) Upon and after conversion of shares of the
Preferred Stock, the Corporation shall have no obligation to pay any undeclared
Accumulated Dividends or Accrued Dividends.
(c) The Conversion Price shall be subject to
adjustment as follows:
(i) In case the Corporation shall at any
time or from time to time make a redemption payment or pay a dividend or make
another distribution payable in shares of the Corporation's Common Stock to all
holders of any class of the Corporation's capital stock, other than the issuance
of shares of Class A Common Stock in connection with the conversion of Preferred
Stock, then, the Conversion Price in effect immediately prior to such event
shall be adjusted (and any other appropriate actions shall be taken by the
Corporation) so that the holder of any share of Preferred Stock thereafter
surrendered for conversion shall be entitled to receive the number of shares of
Class A Common Stock that such holder would have owned or would have been
entitled to receive upon or by reason of any of the events described above, had
such share of Preferred Stock been converted into shares of Class A Common Stock
immediately prior to the occurrence of such event. An adjustment made pursuant
to this Section 9(c)(i) shall become effective retroactively in the case of any
such dividend or distribution, to the day immediately following the close of
business on the record date for the determination of holders of Common Stock
entitled to receive such dividend or distribution.
(ii) In case the Corporation shall at any
time or from time to time issue to all holders of its Common Stock rights,
options or warrants entitling the holders thereof to subscribe for or purchase
shares of Common Stock (or securities convertible into or exchangeable for
shares of Common Stock) at a price per share less than the Market Value as of
the record date of such issuance (treating the price per share of any security
convertible or exchangeable or exercisable into Common Stock as equal to (A) the
sum of the price paid to acquire such security convertible, exchangeable or
exercisable into Common Stock plus any additional consideration payable (without
regard to any anti-dilution adjustments) upon the conversion, exchange or
exercise of such security into Common Stock divided by (B) the number of shares
of Common Stock into which such convertible, exchangeable or exercisable
security is initially convertible, exchangeable or exercisable), other than (I)
issuances of such rights, options or warrants if the holder of Preferred Stock
would be entitled to receive such rights, options or warrants upon conversion at
any time of shares of Preferred Stock, or if such rights, options, and warrants
have expired or been redeemed by the Corporation prior to conversion and (II)
issuances that are subject to certain triggering events (until such time as such
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triggering events occur), then, the Conversion Price then in effect shall be
adjusted by dividing the Conversion Price in effect on the day immediately prior
to the record date of such issuance by a fraction (y) the numerator of which
shall be the sum of the number of shares of Common Stock outstanding on such
record date plus the number of additional shares of Common Stock issued or to be
issued upon or as a result of the issuance of such rights, options or warrants
(or the maximum number into or for which such convertible or exchangeable
securities initially may convert or exchange or for which such options, warrants
or other rights initially may be exercised) and (z) the denominator of which
shall be the sum of the number of shares of Common Stock outstanding on such
record date plus the number of shares of Common Stock which the aggregate
consideration for the total number of such additional shares of Common Stock so
issued (or into or for which such convertible or exchangeable securities may
convert or exchange or for which such options, warrants or other rights may be
exercised plus the aggregate amount of any additional consideration initially
payable upon the conversion, exchange or exercise of such security) would
purchase at the Market Value as of such record date; provided, that if the
Corporation distributes rights or warrants (other than those referred to above
in this subparagraph (c)(ii)) pro rata to the holders of Common Stock, so long
as such rights or warrants have not expired or been redeemed by the Corporation,
(y) the holder of any Preferred Stock surrendered for conversion shall be
entitled to receive upon such conversion, in addition to the shares of Class A
Common Stock then issuable upon such conversion (the "Conversion Shares"), a
number of rights or warrants to be determined as follows: (i) if such conversion
occurs on or prior to the date for the distribution to the holders of rights or
warrants of separate certificates evidencing such rights or warrants (the
"Distribution Date"), the same number of rights or warrants to which a holder of
a number of shares of Class A Common Stock equal to the number of Conversion
Shares is entitled at the time of such conversion in accordance with the terms
and provisions applicable to the rights or warrants and (ii) if such conversion
occurs after the Distribution Date, the same number of rights or warrants to
which a holder of the number of shares of Class A Common Stock into which such
Preferred Stock was convertible immediately prior to such Distribution Date
would have been entitled on such Distribution Date had such Preferred Stock been
converted immediately prior to such Distribution Date in accordance with the
terms and Provisions applicable to the rights and warrants, and (z) the
Conversion Price shall not be subject to adjustment on account of any
declaration, distribution or exercise of such rights or warrants.
(iii) In case the Corporation shall at any
time or from time to time subdivide the outstanding shares of Common Stock into
a larger number of shares, combine the outstanding shares of Common Stock into a
smaller number of shares, or issue any shares of its capital stock in a
reclassification of the Common Stock, then, the Conversion Price in effect
immediately prior to such event shall be adjusted (and any other appropriate
actions shall be taken by the Corporation) so that the holder of any share of
Preferred Stock thereafter surrendered for conversion shall be entitled to
receive the number of shares of Common Stock that such holder would have owned
or would have been entitled to receive upon or by reason of any of the events
described above, had such share of Preferred Stock been converted into shares of
Class A Common Stock immediately prior to the occurrence of such event. An
adjustment made pursuant to this Section 9(c)(iii) shall become effective
retroactively in the case of any such subdivision, combination, or
reclassification, to the close of business on the date upon which such corporate
action becomes effective.
(iv) In case the Corporation shall at any
time or from time to time pay a dividend or distribute to all holders of shares
of the Corporation's Common Stock
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(other than a dividend or distribution subject to 9(c)(ii)) pursuant to any
shareholder rights plan, "poison pill" or similar arrangement and excluding
regular dividends and distributions paid exclusively in cash and dividends
payable upon the Preferred Stock, then, the Conversion Price in effect
immediately prior to such event shall be adjusted (and any other appropriate
actions shall be taken by the Corporation) so that the holder of any share of
Preferred Stock thereafter surrendered for conversion shall be entitled to
receive the number of shares of Class A Common Stock that such holder would have
owned or would have been entitled to receive upon or by reason of any of the
events described above, had such share of Preferred Stock been converted into
shares of Class A Common Stock immediately prior to the occurrence of such
event. An adjustment made pursuant to this Section 9(c)(iv) shall become
effective retroactively in the case of any such dividend or distribution, to the
day immediately following the close of business on the record date for the
determination of holders of Common Stock entitled to receive such dividend or
distribution.
(v) In case the Corporation shall at any
time or from time to time (A) make a distribution to all holders of shares of
its Common Stock consisting exclusively of cash (excluding any cash portion of
distributions referred to in paragraph (iv) above, or cash distributed upon a
merger or consolidation to which (B) of this paragraph below applies), that,
when combined together with (x) all other such all-cash distributions made
within the then-preceding 12 months in respect of which no adjustment has been
made and (y) any cash and the fair market value of any other consideration paid
or payable in respect of any tender offer by the Corporation or any of its
subsidiaries for shares of Common Stock concluded within the then-preceding 12
months in respect of which no adjustment pursuant to this Section 9(c) has been
made, in the aggregate exceeds 15% of the Corporation's Market Capitalization as
of the record date of such distribution; (B) complete a tender or exchange offer
which the Corporation or any of its subsidiaries makes for shares of the
Corporation's Common Stock that involves an aggregate consideration that,
together with (x) any cash and other consideration payable in a tender or
exchange offer by the Corporation or any of its subsidiaries for shares of the
Corporation's Common Stock expiring within the then preceding 12 months in
respect of which no adjustment has been made and (y) the aggregate amount of any
such all-cash distributions referred to in (A) of this paragraph to all holders
of shares of Common Stock within the then preceding 12 months in respect of
which not adjustments have been made, exceeds 15% of the Corporation's Market
Capitalization just prior to the expiration of such tender offer; or (C) make a
distribution to all holders of its Common Stock consisting of evidences of
indebtedness, shares of its capital stock other than Common Stock or assets
(including securities, but excluding those dividends, rights, options, warrants
and distributions referred to in this Section 9(c)), then, the Conversion Price
then in effect shall be adjusted by dividing the Conversion Price in effect
immediately prior to the date of such distribution or completion of such tender
or exchange offer, as the case may be, by a fraction (x) the numerator of which
shall be the Market Value as of the record date referred to below, or, if such
adjustment is made upon the completion of a tender or exchange offer, as of the
payment date for such offer, and (y) the denominator of which shall be such
Market Value less the then fair market value (as determined by the Board of
Directors of the Corporation) of the portion of the cash, evidences of
indebtedness, securities or other assets so distributed or paid in such tender
or exchange offer, applicable to one share of Common Stock (but such denominator
not to be less than one); provided, however, that no adjustment shall be made
with respect to any distribution of rights to purchase securities of the
Corporation if the holder of shares of Preferred Stock would otherwise be
entitled to receive such rights upon Conversion at any time of shares of
Preferred Stock into shares of Class A Common Stock unless such rights are
subsequently redeemed by the Corporation, in which case such redemption shall
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be treated for purposes of this Section 9(c)(v) as a dividend on the Common
Stock. Such adjustment shall be made whenever any such distribution is made or
tender or exchange offer is completed, as the case may be, and shall become
effective retroactively to a date immediately following the close of business on
the record date for the determination of stockholders entitled to receive such
distribution.
(vi) In the case the Corporation at any
time or from time to time shall take any action affecting its Common Stock (it
being understood that the issuance or sale of shares of Class A Common Stock (or
securities convertible into or exchangeable for shares of Class A Common Stock,
or any options, warrants or other rights to acquire shares of Class A Common
Stock) to any Person at a price per share less than the Conversion Price then in
effect shall not be deemed such an action), other than an action described in
any of Section 9(c)(i) through Section 9(c)(v), inclusive, or Section 9(g), then
the Conversion Price shall be adjusted in such manner and at such time as the
Board of Directors of the Corporation in good faith determines to be equitable
in the circumstances (such determination to be evidenced in a resolution, a
certified copy of which shall be mailed to the holders of the Preferred Stock).
(vii) Notwithstanding anything in this
Exhibit A to the contrary, no adjustment under this Section 9(c) need be made to
the Conversion Price unless such adjustment would require an increase or
decrease of at least 1% of the Conversion Price then if effect. Any lesser
adjustment shall be carried forward and shall be made at the time of and
together with the next subsequent adjustment, if any, which, together with any
adjustment or adjustments so carried forward, shall amount to an increase or
decrease of at least 1% of such Conversion Price. Notwithstanding anything to
the contrary, no Conversion Price adjustment will be made as a result of the
issuance of the Corporation's Class A Common Stock on conversion of the
Preferred Stock. Each event requiring adjustment to the Conversion Price will
require only a single adjustment even though more than one of the foregoing
adjustment clauses may be applicable to such event.
(viii) The Corporation reserves the right
to make such reductions in the Conversion Price in addition to those required in
the foregoing provisions as it considers advisable in order that any event
treated for Federal income tax purposes as a dividend of stock or stock rights
will not be taxable to the recipients. In the event the Corporation elects to
make such a reduction in the Conversion Price, the Corporation will comply with
the requirements of Rule 14e-1 under the Exchange Act, and any other securities
laws and regulations thereunder if and to the extent that such laws and
regulations are applicable in connection with the reduction of the Conversion
Price.
(d) If the Corporation shall take a record of
the holders of its Common Stock for the purpose of entitling them to receive a
dividend or other distribution, and shall thereafter (and before the dividend or
distribution has been paid or delivered to stockholders) legally abandon its
plan to pay or deliver such dividend or distribution, then thereafter no
adjustment in the Conversion Price then in effect shall be required by reason of
the taking of such record.
(e) Upon any increase or decrease in the
Conversion Price, then, and in each such case, the Corporation promptly shall
deliver to each registered holder of Preferred Stock a certificate signed by an
authorized officer of the Corporation, setting forth in reasonable detail the
event requiring the adjustment and the method by which such adjustment was
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calculated and specifying the increased or decreased Conversion Price then in
effect following such adjustment.
(f) No fractional shares or scrip representing
fractional shares of Class A Common Stock shall be issued upon the conversion of
any shares of Preferred Stock. If more than one share of Preferred Stock shall
be surrendered for conversion at one time by the same holder, the number of full
shares of Class A Common Stock issuable upon conversion thereof shall be
computed on the basis of the aggregate Liquidation Preference of the shares of
Preferred Stock so surrendered. If the conversion of any share or shares of
Preferred Stock results in a fraction, an amount equal to such fraction
multiplied by the last reported sale price of the Class A Common Stock on the
Nasdaq Stock Market (or on such other national securities exchange or authorized
quotation system on which the Class A Common Stock is then listed for trading or
authorized for quotation or, if the Class A Common Stock is not then so listed
or authorized for quotation, an amount determined in good faith by the Board of
Directors to be the fair value of the Class A Common Stock) at the close of
business on the trading day next preceding the day of conversion shall be paid
to such holder in cash by the Corporation.
(g) In the event of any capital reorganization
or reclassification or other change of outstanding shares of Class A Common
Stock (other than a change in par value, or from par value to no par value, or
from no par value to par value), or in the event of any consolidation or merger
of the Corporation with or into another Person (other than a consolidation or
merger in which the Corporation is the resulting or surviving Person and which
does not result in any reclassification or change of outstanding Class A Common
Stock), or in the event of any sale or other disposition to another Person of
all or substantially all of the assets of the Corporation (other than any assets
not owned directly or indirectly by the Corporation and its subsidiaries)
(computed on a consolidated basis) (any of the foregoing, a "Transaction"), each
share of Preferred Stock then outstanding shall, without the consent of any
holder of Preferred Stock, become convertible only into the kind and amount of
shares of stock or other securities (of the Corporation or another issuer) or
property or cash receivable upon such Transaction by a holder of the number of
shares of Class A Common Stock into which such share of Preferred Stock could
have been converted immediately prior to such Transaction after giving effect to
any adjustment event. The provisions of this Section 9(g) and any equivalent
thereof in any such certificate similarly shall apply to successive
Transactions. The provisions of this Section 9(g) shall be the sole right of
holders of Preferred Stock in connection with any Transaction and such holders
shall have no separate vote thereon.
(h) In the event of any distribution by the
Corporation to its stockholders of all or substantially all of its assets (other
than any assets not owned directly or indirectly by the Corporation and its
subsidiaries) (computed on a consolidated basis), each holder of Preferred Stock
will participate pro rata in such distribution based on the number of shares of
Class A Common Stock into which such holders' shares of Preferred Stock would
have been convertible immediately prior to such distribution.
(i) The Corporation shall at all times reserve
and keep available for issuance upon the conversion of the Preferred Stock such
number of its authorized but unissued shares of Class A Common Stock as will
from time to time be sufficient to permit the conversion of all outstanding
shares of Preferred Stock, and shall take all action required to increase the
authorized number of shares of Class A Common Stock if at any time there shall
be insufficient
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unissued shares of Class A Common Stock to permit such reservation or to permit
the conversion of all outstanding shares of Preferred Stock.
(j) The issuance or delivery of certificates for
Class A Common Stock upon the conversion of shares of Preferred Stock shall be
made without charge to the converting holder of shares of Preferred Stock for
such certificates or for any documentary stamp or similar issue or transfer tax
in respect of the issuance or delivery of such certificates or the securities
represented thereby, and such certificates shall be issued or delivered in the
respective names of, or in such names as may be directed by, the holders of the
shares of Preferred Stock converted; provided, however, that the Corporation
shall not be required to pay any tax which may be payable in respect of any
transfer involved in the issuance and delivery of any such certificate in a name
other than that of the holder of the shares of Preferred Stock converted, and
the Corporation shall not be required to issue or deliver such certificate
unless or until the Person or Persons requesting the issuance or delivery
thereof shall have paid to the Corporation the amount of such tax or shall have
established to the reasonable satisfaction of the Corporation that such tax has
been paid.
10. Other Provisions.
10.1 With respect to any notice to a holder of shares of
Preferred Stock required to be provided hereunder, neither failure to mail such
notice, nor any defect therein or in the mailing thereof, to any particular
holder shall affect the sufficiency of the notice or the validity of the
proceedings referred to in such notice with respect to the other holders or
affect the legality or validity of any distribution, rights, warrant,
reclassification, consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding-up, or the vote upon any such action. Any notice which
was mailed in the manner provided in this Exhibit A shall be conclusively
presumed to have been duly given whether or not the holder receives the notice.
10.2 Shares of Preferred Stock issued and reacquired will
be retired and canceled promptly after reacquisition thereof and, upon
compliance with the applicable requirements of Indiana law, have the status of
authorized but unissued shares of preferred stock of the Corporation
undesignated as to series and may with any and all other authorized but unissued
shares of preferred stock of the Corporation be designated or redesignated and
issued or reissued, as the case may be, as part of any series of preferred stock
of the Corporation, except that any issuance or reissuance of shares of
Preferred Stock must be in compliance with this Certificate of Designation.
10.3 The shares of Preferred Stock shall be issuable only
in whole shares.
10.4 All notices periods referred to in this Exhibit A
shall commence on the date of the mailing of the applicable notice.
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