<PAGE>
CERTIFICATE OF ELIMINATION OF THE PREFERRED REDEEMABLE
INCREASED DIVIDEND EQUITY SECURITIES SM, 8-1/4% PRIDES SM,
CONVERTIBLE PREFERRED STOCK
OF KENETECH CORPORATION
Pursuant to Section 151(g)
of the General Corporation Law
of the State of Delaware
KENETECH Corporation, a corporation organized and existing under the laws
of the State of Delaware (the "Company"), in accordance with the provisions of
Section 151(g) of the General Corporation Law of the State of Delaware, hereby
certifies as follows:
1. That, pursuant to Section 151 of the General Corporation Law of the
State of Delaware and authority granted in the Certificate of Incorporation of
the Company, as theretofore amended and restated, the Board of Directors of the
Company, by resolution duly adopted, authorized the issuance of a series of one
hundred and ten thousand (110,000) shares of Preferred Redeemable Increased
Dividend Equity Securities SM, 8-1/4% PRIDES SM, Convertible Preferred Stock,
par value $.01 per share (the "PRIDES"), and established the voting powers,
designations, preferences and relative, participating and other rights, and the
qualifications, limitations or restrictions thereof, and, on May 4, 1994, filed
a Certificate of Designation (the "Certificate of Designation") with respect to
such PRIDES in the office of the Secretary of State of the State of Delaware.
2. That no shares of said PRIDES are outstanding and no shares thereof will
be issued subject to said Certificate of Designation.
3. That the Board of Directors of the Company has adopted the following
resolutions:
WHEREAS, by resolution of the Board of Directors of the Company and by
a Certificate of Designation (the "Certificate of Designation") filed in
the office of the Secretary of State of the State of Delaware on May 4,
1994, this Company authorized the issuance of a series of one hundred ten
thousand (110,000) shares of Preferred Redeemable Increased Dividend Equity
Securities SM, 8-1/4% PRIDES SM, Convertible Preferred Stock, par value
$.01 per share, of the Company (the "PRIDES") and established the voting
powers, designations, preferences and relative, participating and other
rights, and the qualifications, limitations or restrictions thereof; and
WHEREAS, as of the date hereof no shares of such PRIDES are
outstanding and no shares of such PRIDES will be issued subject to said
Certificate of Designation; and
WHEREAS, it is desirable that all matters set forth in the Certificate
of Designation with respect to such PRIDES be eliminated from the
Certificate of Incorporation, as heretofore amended and restated, of the
Company;
NOW, THEREFORE, BE IT AND IT HEREBY IS
RESOLVED, that all matters set forth in the Certificate of Designation
with respect to such PRIDES be eliminated from the Certificate of
Incorporation, as heretofore amended and restated, of the Company; and it
is further
RESOLVED, that the officers of the Company be, and hereby are,
authorized and directed to execute and file a Certificate of Elimination
with the office of the Secretary of State of the State of Delaware setting
forth a copy of these resolutions whereupon all matters set forth in the
Certificate of Designation with respect to such PRIDES shall be eliminated
from the Certificate of Incorporation, as heretofore amended and restated,
of the Company.
<PAGE>
4. That, accordingly, all matters set forth in the Certificate of
Designation with respect to such PRIDES be, and hereby are, eliminated from the
Certificate of Incorporation, as heretofore amended and restated, of the
Company.
IN WITNESS WHEREOF, KENETECH Corporation has caused this Certificate of
Elimination to be signed by Dianne P. Urhausen its Secretary, as of this 3rd day
of May, 2000.
KENETECH CORPORATION
By:_s/ Dianne P. Urhausen__________
Name: Dianne P. Urhausen
Office: Secretary
<PAGE>
CERTIFICATE OF DESIGNATION
of
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
KENETECH CORPORATION
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
KENETECH Corporation, a corporation organized and existing under the
General Corporation Law of the State of Delaware, in accordance with the
provisions of Section 103 thereof, DOES HEREBY CERTIFY:
That pursuant to the authority vested in the Board of Directors in
accordance with the provisions of the Certificate of Incorporation of the said
Corporation, the said Board of Directors on May 4, 1999 adopted the following
resolution creating a series of 84,000 shares of Preferred Stock designated as
"Series A Junior Participating Preferred Stock":
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions of the
Certificate of Incorporation, a series of Preferred Stock, par value $.01
per share, of the Corporation be and hereby is created, and that the
designation and number of shares thereof and the voting and other powers,
preferences and relative, participating, optional or other rights of the
shares of such series and the qualifications, limitations and restrictions
thereof are as follows:
Series A Junior Participating Preferred Stock
1. Designation and Amount. There shall be a series of Preferred Stock that
shall be designated as "Series A Junior Participating Preferred Stock," and the
number of shares constituting such series shall be 84,000. Such number of shares
may be increased or decreased by resolution of the Board of Directors; provided,
however, that no decrease shall reduce the number of shares of Series A Junior
Participating Preferred Stock to less than the number of shares then issued and
outstanding plus the number of shares issuable upon exercise of outstanding
rights, options or warrants or upon conversion of outstanding securities issued
by the Corporation.
2. Dividends and Distribution.
(A) Subject to the prior and superior rights of the holders of any shares
of any class or series of stock of the Corporation ranking prior and superior to
the shares of Series A Junior Participating Preferred Stock with respect to
dividends, the holders of shares of Series A Junior Participating Preferred
Stock, in preference to the holders of shares of any class or series of stock of
the Corporation ranking junior to the Series A Junior Participating Preferred
Stock in respect thereof, shall be entitled to receive, when, as and if declared
by the Board of Directors out of funds legally available for the purpose,
quarterly dividends payable in cash on the last day of March, June, September
and December, in each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Junior Participating Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $10 or (b) the Adjustment
Number (as defined below) times the aggregate per share amount of all cash
dividends, and the Adjustment Number times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock, par value $.0001 per share, of the Corporation (the "Common
Stock") since the immediately preceding Quarterly Dividend Payment Date, or,
with respect to the first Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series A Junior Participating
Preferred Stock. The "Adjustment Number" shall initially be 1000. In the event
the Corporation shall at any time after May~5, 1999 (i) declare and pay any
dividend on Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the Adjustment Number in effect
immediately prior to such event shall be adjusted by multiplying such Adjustment
Number by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.
<PAGE>
(B) The Corporation shall declare a dividend or distribution on the Series
A Junior Participating Preferred Stock as provided in paragraph (A) above
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock).
(C) Dividends shall begin to accrue and be cumulative on outstanding shares
of Series A Junior Participating Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A Junior
Participating Preferred Stock, unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date of issue of such
shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a
date after the record date for the determination of holders of shares of Series
A Junior Participating Preferred Stock entitled to receive a quarterly dividend
and before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Series A Junior Participating Preferred Stock in an amount
less than the total amount of such dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may fix a record date for
the determination of holders of shares of Series A Junior Participating
Preferred Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be no more than 60 days prior to the
date fixed for the payment thereof.
3. Voting Rights. The holders of shares of Series A Junior Participating
Preferred Stock shall have the following voting rights:
(A) Each share of Series A Junior Participating Preferred Stock shall
entitle the holder thereof to a number of votes equal to the Adjustment Number
on all matters submitted to a vote of the stockholders of the Corporation.
(B) Except as required by law, by Section 3(C) and by Section 10 hereof,
holders of Series A Junior Participating Preferred Stock shall have no special
voting rights and their consent shall not be required (except to the extent they
are entitled to vote with holders of Common Stock as set forth herein) for
taking any corporate action.
(C) If, at the time of any annual meeting of stockholders for the election
of directors, the equivalent of six quarterly dividends (whether or not
consecutive) payable on any share or shares of Series A Junior Participating
Preferred Stock are in default, the number of directors constituting the Board
of Directors of the Company shall be increased by two. In addition to voting
together with the holders of Common Stock for the election of other directors of
the Company, the holders of record of the Series A Junior Participating
Preferred Stock, voting separately as a class to the exclusion of the holders of
Common Stock, shall be entitled at said meeting of stockholders (and at each
subsequent annual meeting of stockholders), unless all dividends in arrears on
the Series A Junior Participating Preferred Stock have been paid or declared and
set apart for payment prior thereto, to vote for the election of two directors
of the Company, the holders of any Series A Junior Participating Preferred Stock
being entitled to cast a number of votes per share of Series A Junior
Participating Preferred Stock as is specified in paragraph (A) of this Section
3. Each such additional director shall not be a member of Class I, Class II or
Class III of the Board of Directors of the Company, but shall serve until the
next annual meeting of stockholders for the election of directors, or until his
successor shall be elected and shall qualify, or until his right to hold such
office terminates pursuant to the provisions of this Section 3(C). Until the
default in payments of all dividends which permitted the election of said
directors shall cease to exist, any director who shall have been so elected
pursuant to the provisions of this Section 3(C) may be removed at any time,
without cause, only by the affirmative vote of the holders of the shares of
Series A Junior Participating Preferred Stock at the time entitled to cast a
majority of the votes entitled to be cast for the election of any such director
at a special meeting of such holders called for that purpose, and any vacancy
thereby created may be filled by the vote of such holders. If and when such
default shall cease to exist, the holders of the Series A Junior Participating
Preferred Stock shall be divested of the foregoing special voting rights,
subject to revesting in the event of each and every subsequent like default in
payments of dividends. Upon the termination of the foregoing special voting
rights, the terms of office of all persons who may have been elected directors
pursuant to said special voting rights shall forthwith terminate, and the number
of directors constituting the Board of Directors shall be reduced by two. The
voting rights granted by this Section 3(C) shall be in addition to any other
voting rights granted to the holders of the Series A Junior Participating
Preferred Stock in this Section 3.
<PAGE>
4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Junior Participating Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid dividends
and distributions, whether or not declared, on shares of Series A Junior
Participating Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends on, make any other distributions on, or
redeem or purchase or otherwise acquire for consideration any shares of
stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Junior Participating Preferred
Stock;
(ii) declare or pay dividends on or make any other distributions on
any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Junior
Participating Preferred Stock, except dividends paid ratably on the Series
A Junior Participating Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total amounts to
which the holders of all such shares are then entitled; or
(iii) purchase or otherwise acquire for consideration any shares of
Series A Junior Participating Preferred Stock, or any shares of stock
ranking on a parity with the Series A Junior Participating Preferred Stock,
except in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all holders of
Series A Junior Participating Preferred Stock, or to such holders and
holders of any such shares ranking on a parity therewith, upon such terms
as the Board of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of the respective
series and classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in such manner.
5. Reacquired Shares. Any shares of Series A Junior Participating Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired promptly after the acquisition thereof. All such
shares shall upon their retirement become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of Preferred Stock
to be created by resolution or resolutions of the Board of Directors, subject to
any conditions and restrictions on issuance set forth herein.
6. Liquidation, Dissolution or Winding Up. (A) Upon any liquidation,
dissolution or winding up of the Corporation, voluntary or otherwise, no
distribution shall be made to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series A Junior Participating Preferred Stock unless, prior thereto, the holders
of shares of Series A Junior Participating Preferred Stock shall have received
an amount per share (the "Series A Liquidation Preference") equal to the greater
of (i) $10 plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment, or
(ii) the Adjustment Number times the per share amount of all cash and other
property to be distributed in respect of the Common Stock upon such liquidation,
dissolution or winding up of the Corporation.
(B) In the event, however, that there are not sufficient assets available
to permit payment in full of the Series A Liquidation Preference and the
liquidation preferences of all other classes and series of stock of the
Corporation, if any, that rank on a parity with the Series A Junior
Participating Preferred Stock in respect thereof, then the assets available for
such distribution shall be distributed ratably to the holders of the Series A
Junior Participating Preferred Stock and the holders of such parity shares in
proportion to their respective liquidation preferences.
<PAGE>
(C) Neither the merger or consolidation of the Corporation into or with
another corporation nor the merger or consolidation of any other corporation
into or with the Corporation shall be deemed to be a liquidation, dissolution or
winding up of the Corporation within the meaning of this Section 6.
7. Consolidation, Merger, Etc. In case the Corporation shall enter into any
consolidation, merger, combination or other transaction in which the outstanding
shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case each share of
Series A Junior Participating Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share equal to the Adjustment
Number times the aggregate amount of stock, securities, cash and/or any other
property (payable in kind), as the case may be, into which or for which each
share of Common Stock is changed or exchanged.
8. No Redemption. Shares of Series A Junior Participating Preferred Stock
shall not be subject to redemption by the Company.
9. Ranking. The Series A Junior Participating Preferred Stock shall rank
junior to all other series of the Preferred Stock as to the payment of dividends
and as to the distribution of assets upon liquidation, dissolution or winding
up, unless the terms of any such series shall provide otherwise, and shall rank
senior to the Common Stock as to such matters.
10. Amendment. At any time that any shares of Series A Junior Participating
Preferred Stock are outstanding, the Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series A Junior
Participating Preferred Stock so as to affect them adversely without the
affirmative vote of the holders of two-thirds of the outstanding shares of
Series A Junior Participating Preferred Stock, voting separately as a class.
11. Fractional Shares. Series A Junior Participating Preferred Stock may be
issued in fractions of a share that shall entitle the holder, in proportion to
such holder's fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Junior Participating Preferred Stock.
IN WITNESS WHEREOF, the undersigned has executed this Certificate this 12th
day of May, 1999.
KENETECH CORPORATION
By: s/Mark Lerdal
Name: Mark D. Lerdal
Title: President and Chief
Executive Officer
<PAGE>
CERTIFICATE OF CHANGE OF LOCATION OF REGISTERED OFFICE
AND OF REGISTERED AGENT
It is hereby certified that:
1. The name of the corporation (hereinafter called the "corporation") is
KENETECH CORPORATION
2. The registered office of the corporation within the State of Delaware is
hereby changed to 32 Loockerman Square, Suite L-100, City of Dover 19904, County
of Kent.
3. The registered agent of the corporation within the State of Delaware is
hereby changed to The Prentice-Hall Corporation System, Inc., the business
office of which is identical with the registered office of the corporation as
hereby changed.
4. The corporation has authorized the changes hereinbefore set forth by
resolution of its Board of Directors.
Signed on December 20, 1994.
s/ Mark Lerdal
authorized officer
Mark Lerdal
Vice President
<PAGE>
CERTIFICATE OF FIRST AMENDMENT
TO THE
RESTATED CERTIFICATE OF INCORPORATION FILED SEPTEMBER 27, 1993
OF
KENETECH CORPORATION
_________________
Pursuant to Section 242 of the General
Corporation Law of the State of Delaware.
KENETECH Corporation (herein called the "Corporation" or the "Company"), a
corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware, does hereby certify:
FIRST: That the Board of Directors of the Corporation at a regular meeting
duly called and held on March 31, 1994 at which a quorum was at all times
present and acting, adopted a resolution proposing and declaring advisable
the following First Amendment to the Restated Certificate of Incorporation
of the Corporation filed September 27, 1993:
RESOLVED: That Article 4.1 of the Restated Certificate of Incorporation of
the Company be amended to read as follows:
4.1 Authorized Stock. The Corporation is authorized to issue two
classes of stock, denominated Common Stock and Preferred Stock.
The Common Stock shall have a par value of $0.0001 per share, and
the Preferred Stock shall have a par value of $0.01 per share.
The total number of shares of Common Stock which the Corporation
is authorized to issue is One Hundred Ten Million (110,000,000),
and the number of shares of Preferred Stock which the Corporation
is authorized to issue is Ten Million (10,000,000), which shares
shall be undesignated as to series.
SECOND: That said amendment was thereafter duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware by a majority of the stockholders acting at the Annual Meeting
duly called and held May 25, 1994.
THIRD: That the capital of the Corporation will not be reduced under or by
reason of said amendment.
IN WITNESS WHEREOF, KENETECH Corporation has caused this Certificate to be
signed by Maurice E. Miller, its Executive Vice President, and attested by Tom
E. Pollock, its Assistant Secretary, and has caused its corporate seal to be
affixed hereto, this 26th day of May, 1994.
KENETECH Corporation
By: s/ Maurice E. Miller
Maurice E. Miller
Executive Vice President
ATTEST:
s/ Tom E. Pollock
Tom E. Pollock
Assistant Secretary
[SEAL]
<PAGE>
CERTIFICATE OF DESIGNATIONS,
PREFERENCES, RIGHTS AND LIMITATIONS OF
Preferred Redeemable Increased Dividend Equity Securities SM,
8-1/4% PRIDES, Convertible Preferred Stock
of
KENETECH CORPORATION
________________________
Pursuant to Section 151 of the General
Corporation Law of the State of Delaware
KENETECH Corporation, a corporation organized and existing under the laws
of the State of Delaware (the "Corporation"), hereby certifies that, under (i)
authority conferred upon the Board of Directors by the Restated Certificate of
Incorporation of the Corporation, as amended to date, (ii) the provisions of
Sections 141(c) and 151 of the General Corporation Law of the State of Delaware,
and (iii) resolutions adopted by the Board of Directors at its meeting on March
31, 1994, the Board of Directors duly adopted the following resolution:
RESOLVED, that under authority conferred upon the Board of Directors by the
Restated Certificate of Incorporation (the "Restated Certificate of
Incorporation"), the Board of Directors hereby authorizes the issuance of up to
110,000 shares of authorized and unissued preferred stock, par value $0.01, of
the Corporation, and hereby fixes the designation, powers, preferences and
relative, participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of such shares, in addition
to those set forth in the Restated Certificate of Incorporation, as follows, to
be set forth in a certificate of designations (the "Certificate of
Designations"):
Section 1. Designation and Size of Issue; Ranking. (a) The distinctive
designation of the series of preferred stock shall be "Preferred Redeemable
Increased Dividend Equity Securities SM, 8-1/4% PRIDES, Convertible Preferred
Stock" (the "PRIDES"). The number of shares constituting the PRIDES shall be
110,000 shares. Each share of PRIDES shall have a stated value of $1,012.50.
SM Service Mark of Merrill Lynch & Co., Inc.
(b) Any shares of the PRIDES which at any time have been redeemed for,
or converted into, Common Stock, par value $0.0001, of the Corporation (the
"Common Stock") or otherwise reacquired by the Corporation shall, after
such redemption, conversion or other acquisition, resume the status of
authorized and unissued shares of preferred stock, par value $0.01 of the
Corporation (the "Preferred Stock"), without designation as to series until
such shares are once more designated as part of a particular series by the
Board of Directors.
(c) The shares of PRIDES shall rank on a parity, both as to payment of
dividends and distribution of assets upon liquidation, with any Preferred
Stock issued by the Corporation after the date of this Certificate of
Designations that by its terms ranks pari passu with the PRIDES ("Parity
Preferred Stock").
<PAGE>
Section 2. Dividends. (a) The holders of record of the shares of PRIDES shall be
entitled to receive, when and as declared by the Board of Directors out of funds
legally available therefor, cash dividends ("Preferred Dividends') from the date
of the issuance of the shares of PRIDES at the rate per annum of 8-1/4 percent
of the stated value per sham (equivalent to $83.55 per annum or $20.8975 per
quarter for each share of PRIDES), payable quarterly in arrears, on each
February 15, May 15, August 15 and November 15 (each a "Dividend Payment Date")
or, if any such date is not a business day (as defined herein), the Preferred
Dividend due on such Dividend Payment Date shall be paid on the next succeeding
business day; provided, however, that, with respect to any dividend period
during which a redemption occurs, the Corporation may, at its option, declare
accrued Preferred Dividends to, and pay such Preferred Dividends on, the date
fixed for redemption, in which case such Preferred Dividends shall be payable to
the holders of shares of PRIDES as of the record date for such dividend payment
and shall not be included in the calculation of the related PRIDES Call Price
(as defined herein). The first dividend period shall be from the date of initial
issuance of the shares of PRIDES to but excluding August 15, 1994 and the first
Preferred Dividend shall be payable on August 15, 1994. Preferred Dividends on
shares of PRIDES shall be cumulative and shall accumulate from the date of
original issuance. Preferred Dividends on shares of PRIDES shall cease to accrue
from and after the Mandatory Conversion Date (as defined herein) or on and after
the date of their earlier conversion or redemption, as the case may be.
Preferred Dividends shall be payable to holders of record as they appear on the
stock register of the Corporation on such record date, not less than 15 nor more
than 60 days preceding the payment date thereof, as shall be fixed by the Board
of Directors. Preferred Dividends payable on shares of PRIDES for any period
less than a full quarterly dividend period (or, in the case of the first
Preferred Dividend, from the date of initial issuance of the shares of PRIDES to
but excluding the first Dividend Payment Date) shall be computed on the basis of
a 360-day year of twelve 30-day months and the actual number of days elapsed in
any period less than one month. Preferred Dividends shall accrue on a daily
basis whether or not there are funds of the Corporation legally available for
the payment of such dividends and whether or not such Preferred Dividends are
declared. Accrued but unpaid Preferred Dividends shall cumulate as of the
Dividend Payment Date on which they first become payable, but no interest shall
accrue on accumulated but unpaid Preferred Dividends.
(b) As long as shares of PRIDES are outstanding, no dividends (other than
dividends payable in shares of, or warrants, rights or options exercisable for
or convertible into, shares of Common Stock or any other capital stock of the
Corporation ranking junior to the shares of PRIDES as to the payment of
dividends and the distribution of assets upon liquidation (collectively, the
"Junior Stock") and cash in lieu of fractional shares of such Junior Stock in
connection with any such dividend) shall be paid or declared in cash or
otherwise, nor shall any other distribution be made (other than a distribution
payable in Junior Stock and cash in lieu of fractional shares of such Junior
Stock in connection with any such distribution), on any Junior Stock unless (i)
full dividends on Preferred Stock (including the shares of PRIDES) that does not
constitute Junior Stock ("Senior Preferred Stock") have been paid, or declared
and set aside for payment, for all dividend periods terminating at or before the
date of such Junior Stock dividend or distribution payment to the extent such
dividends are cumulative; (ii) dividends in full for the current quarterly
dividend period have been paid, or declared and set aside for payment, on all
Senior Preferred Stock to the extent such dividends are cumulative; (iii) the
Corporation has paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase, retirement, and sinking
funds, if any, for any Senior Preferred Stock; and (iv) the Corporation is not
in default on any of its obligations to redeem any Senior Preferred Stock.
(c) As long as any shares of PRIDES are outstanding, no shares of any
Junior Stock may be purchased, redeemed, or otherwise acquired by the
Corporation or any of its subsidiaries (except in connection with a
reclassification or exchange of any Junior Stock through the issuance of other
Junior Stock (and cash in lieu of fractional shares of such Junior Stock in
connection therewith)) nor may any funds be set aside or made available for any
sinking fund for the purchase or redemption of any Junior Stock unless: (i) full
dividends on Senior Preferred Stock have been paid, or declared and set aside
for payment, for all dividend periods terminating at or before the date of such
purchase, redemption or other acquisition to the extent such dividends are
cumulative; (ii) dividends in full for the current quarterly dividend period
have been paid, or declared and set aside for payment, on all Senior Preferred
Stock to the extent such dividends are cumulative; (iii) the Corporation has
paid or set aside all amounts, if any, then or theretofore required to be paid
or set aside for all purchase, retirement, and sinking funds, if any. for any
Senior Preferred Stock; and (iv) the Corporation is not in default on any of its
obligations to redeem any Senior Preferred Stock.
<PAGE>
(d) As long as any shares of PRIDES are outstanding, dividends or other
distributions may not be declared or paid on any Parity Preferred Stock (other
than dividends or other distributions payable in Junior Stock and cash in lieu
of fractional shares of such Junior Stock in connection therewith) and the
Corporation may not purchase, redeem or otherwise acquire any Parity Preferred
Stock (except with any Junior Stock and cash in lieu of fractional shares of
such Junior Stock in connection therewith), unless: (a) (i) full dividends on
Senior Preferred Stock have been paid, or declared and set aside for payment,
for all dividend periods terminating at or before the date of such Parity
Preferred Stock dividend, distribution, purchase, redemption or other
acquisition payment to the extent such dividends are cumulative; (ii) dividends
in full for the current quarterly dividend period have been paid, or declared
and set aside for payment, on all Senior Preferred Stock to the extent such
dividends are cumulative; (iii) the Corporation has paid or set aside all
amounts, if any, then or theretofore required to be paid or set aside for all
purchase, retirement, and sinking funds, if any, for any Senior Preferred Stock;
and (iv) the Corporation is not in default on any of its obligations to redeem
any Senior Preferred Stock; except that (b) with respect to the payment of
dividends on the Parity Preferred Stock only, if all other conditions set forth
in clause (a) are satisfied any such dividends on the Parity Preferred Stock
shall be declared and paid pro rata so that the amounts of any dividends
declared and paid per share of PRIDES and each other share of Senior Preferred
Stock shall in all cases bear to each other the same ratio that accrued
dividends (including, any accumulation with respect to unpaid dividends for
prior dividend periods, if such dividends are cumulative) per share of PRIDES
and such other shares of Parity Preferred Stock bear to each other.
Section 3. Conversion or Redemption. (a) Unless previously either redeemed
or converted at the option of the holder in accordance with the provisions of
Section 3 (c), on May 14, 1998 (the "Mandatory Conversion Date"), each
outstanding share of PRIDES shall manditorily convert ("Mandatory Conversion")
into (i) shares of authorized Common Stock at the PRIDES Common Equivalent Rate
(as defined herein) in effect on the Mandatory Conversion Date and (ii) the
right to receive cash in an amount equal to all accrued and unpaid Preferred
Dividends on such share of PRIDES (other than previously declared dividends
payable to a holder of record as of a prior date) from and after the Mandatory
Conversion Date, whether or not declared, out of funds legally available for the
payment of Preferred Dividends, subject to the right of the Corporation to
redeem the shares of PRIDES on or after May 15, 1997 (the "Initial Redemption
Date") and before the Mandatory Conversion Date and subject to the conversion of
the shares of PRIDES at the option of the holder at any time before the
Mandatory Conversion Date. The "PRIDES Common Equivalent Rate" shall initially
be fifty (50) shares of Common Stock for each share of PRIDES and shall be
subject to adjustment as set forth in Sections 3(d) and 3(e) below. Shares of
PRIDES shall cease to be outstanding from and after the Mandatory Conversion
Date. The Corporation shall make such arrangements as it deems appropriate for
the issuance of certificates representing shares of Common Stock and for the
payment of cash in respect of such accrued and unpaid dividends if any, or cash
in lieu of fractional shares of Common Stock, if any, in exchange for and
contingent upon surrender of certificates representing the shares of PRIDES, and
the Corporation may defer payment of dividends on such shares of Common Stock
and the voting thereof until, and make such payment and voting contingent upon,
the surrender of certificates representing the shares of PRIDES; provided, that
the Corporation shall give the holders of the shares of PRIDES such notice of
any such actions as the Corporation deems appropriate and upon surrender such
holders shall be entitled to receive such dividends declared and paid, if any,
on such shares of Common Stock subsequent to the Mandatory Conversion Date.
(b) (i) Shares of PRIDES are not redeemable by the Corporation before the
Initial Redemption Date. At any time and from time to time on or after that date
until immediately before the Mandatory Conversion Date, the Corporation shall
have the right to redeem, in whole or in part, the outstanding shares of PRIDES
(subject to the notice provisions set forth in Section 3(b)(iv)). Upon any such
redemption, the Corporation shall deliver to each holder thereof, in exchange
for each such share of PRIDES subject to redemption, the greater of (A) the
number of shares of Common Stock equal to the applicable PRIDES Call Price (as
defined herein) in effect on the redemption date divided by the Current Market
Price (as defined herein) of the Common Stock, determined as of the second
Trading Day (as defined herein) immediately preceding the Notice Date (ad
defined herein); or (B) 41.665 shares of Common Stock (the "Minimum Redemption
Rate" which is subject to adjustment in the same manner as the PRIDES Optional
Conversion Rate (as defined herein) is adjusted). Preferred Dividends on the
shares of PRIDES shall cease to accrue on and after the date fixed for their
redemption.
<PAGE>
(ii) The "PRIDES Call Price" of each share of PRIDES shall be the sum of
(x) $1,033.40 on and after the Initial Redemption Date, to and including August
14, 1997; $1,028.15 on and after August 15. 1997, to and including November 14,
1997; $1,022.95 on and after November 15, 1997, to and including February 14,
1988; $1,017.70 on and after February 15, 1998, to and including April 14, 1998;
and $1,012.50 (being the price at which shares of PRIDES are initially sold to
the public) on and after April 15, 1998, to and including May 13, 1998; and (y)
all accrued and unpaid Preferred Dividends thereon to but not including the date
fixed for redemption (other than previously declared Preferred Dividends payable
to a holder of record as of a prior date). If fewer than all the outstanding
shares of PRIDES are to be called for redemption, shares of PRIDES to be called
shall be selected by the Corporation from outstanding shares of PRIDES not
previously called by lot or pro rata (as nearly as may be) or by any other
method determined by the Board of Directors in its sole discretion to be
equitable.
(iii) The term "Current Market Price" per share of the Common Stock on any
date of determination means the lesser of (x) the average of the Closing Prices
(as defined herein) of the Common Stock for the 15 consecutive Trading Days
ending on and including such date of determination, and (y) the Closing Price of
the Common Stock on such date of determination; provided, however, that, with
respect to any redemption of shares of PRIDES, if any event resulting in an
adjustment of the PRIDES Common Equivalent Rate occurs during the period
beginning on the first day of such 15-day period and ending on the applicable
redemption date, the Current Market Price as determined pursuant to the
foregoing shall be appropriately adjusted to reflect the occurrence of such
event.
(iv) The Corporation shall provide notice of any redemption of the shares
of PRIDES to holders of record of the shares of PRIDES to be called for
redemption not less than 15 nor more than 60 days before the date fixed for
redemption. Any such notice shall be provided by mail, sent to the holders of
record of the shares of PRIDES to be called at each such holder's address as it
appears on the stock register of the Corporation, first class postage prepaid;
provided, however, that failure to give such notice or any defect therein shall
not affect the validity of the proceeding for redemption of any shares of PRIDES
to be redeemed except as to the holder to whom the Corporation has failed to
give such notice or whose notice was defective. A public announcement of any
call for redemption shall be made by the Corporation before, or at the time of,
the mailing of such notice of redemption. The term "Notice Date" with respect to
any notice given by the Corporation in connection with a redemption of the
shares of PRIDES means the date on which first occurs either the public
announcement of such redemption or the commencement of mailing of the notice to
the holders of shares of PRIDES, in each case pursuant to this Section 3(b)(iv).
Each such notice shall state, as appropriate, the following and may contain
such other information as the Corporation deems advisable:
(A) the redemption date;
(B) that all outstanding shares of PRIDES are to be redeemed or, in the case of
a redemption of fewer than all outstanding shares of PRIDES, the number of
such shares held by such holder to be redeemed;
(C) the PRIDES Call Price, the number of shares of Common Stock deliverable
upon redemption of each share of PRIDES to be redeemed and the Current
Market Price used to calculate such number of shares of Common Stock;
(D) the place or places where one or more certificates for such shares of
PRIDES are to be surrendered for redemption; and
(E) that dividends on the shares of PRIDES to be redeemed shall cease to accrue
on and after such redemption date (except as otherwise provided herein).
In case fewer than all of the shares of PRIDES are to be redeemed, the shares of
PRIDES to be redeemed shall be selected by lot or pro rata (as nearly as
possible) or by any other method determined by Board of Directors in its sole
discretion to be equitable.
<PAGE>
(v) The Corporation's obligation to deliver shares of Common Stock and
provide funds upon redemption in accordance with this Section 3(b) shall be
deemed fulfilled if, on or before a redemption date, the Corporation shall
deposit with a bank or trust company, or an affiliate of a bank or trust
company, having a combined capital and surplus of at least $50,000,000 according
to its last published statement of condition, or shall set aside or make other
reasonable provision for the issuance of, such number of shares of Common Stork
as are required to be delivered by the Corporation pursuant to this Section 3
(b) upon the occurrence of the related redemption of shares of PRIDES and for
the payment of cash in lieu of the issuance of fractional share amounts and
accrued and unpaid dividends payable in cash on the shares of PRIDES to be
redeemed as required by this Section 3 (b), in trust for the account of the
holder of such shares of PRIDES to be redeemed (and so as to be and continue to
be available therefor), with irrevocable instructions and authority to such bank
or trust company that such shares and funds be delivered upon redemption of the
shares of PRIDES so called for redemption. Any interest accrued on such funds
shall be paid to the Corporation from time to time. Any shares of Common Stock
or funds so deposited and unclaimed at the end of three years from such
redemption date shall be repaid and released to the Corporation, after which the
holder or holders of such shares of PRIDES so called for redemption shall look
only to the Corporation for delivery of shares of Common Stock and the payment
of any other funds due in connection with the redemption of the shares of
PRIDES.
(vi) Each holder of shares of PRIDES called for redemption must surrender
the certificates evidencing such shares (properly endorsed or assigned for
transfer, if the Board of Directors shall so require and the notice shall so
state) to the Corporation at the place designated in the notice of such
redemption and shall thereupon be entitled to receive certificates evidencing
shares of Common Stock and to receive any fund payable pursuant to this Section
3(b) following such surrender and following the date of such redemption. In case
fewer than all the shares represented by any such surrendered certificate are
called for redemption, a new certificate shall be issued at the expense of the
Corporation representing the unredeemed shares. If such notice of redemption
shall have been given, and if on the date fixed for redemption shares of Common
Stock and funds necessary for the redemption shall have been irrevocably either
set aside by the Corporation separate and apart from its other funds or assets
in trust for the account of the holders of the shares to be redeemed (and so as
to be and continue to be available therefor) or deposited with a bank or trust
company or an affiliate thereof as provided herein or the Corporation shall have
made other reasonable provision therefor, then notwithstanding that the
certificates evidencing any shares of PRIDES so called for redemption shall not
have been surrendered, the shares represented thereby so called for redemption
shall be deemed no longer outstanding and Preferred Dividends with respect to
the shares so called for redemption and all rights with respect to the shares so
called for redemption shall forthwith on and after such date cease and terminate
(unless the Corporation defaults on the payment of the redemption price), except
for (i) the rights of the holders to receive the shares of Common Stock and
funds, if any, payable pursuant to this Section 3 (b) without interest upon
surrender of their certificates therefor and (ii) the right of the holders,
pursuant to Section 3 (c) to convert the shares of PRIDES called for redemption
until immediately before the close of business on any redemption date; provided,
however, that holders of shares of PRIDES at the close of business on a record
date for any payment of Preferred Dividends shall be entitled to receive the
Preferred Dividend payable on such shares on the corresponding Dividend Payment
Date notwithstanding the redemption of such shares following such record date
and before the Dividend Payment Date. Holders of shares of PRIDES that are
redeemed shall not be entitled to receive dividends declared and paid on such
shares of Common Stock, and such shares of Common Stock shall not be entitled to
vote, until such shares of Common Stock are issued upon the surrender of the
certificates representing such shares of PRIDES, and upon such surrender such
holders shall be entitled to receive such dividends declared and paid on such
shares of Common Stock subsequent to such redemption date.
(c) Shares of PRIDES are convertible, in whole or in part, at the option of
the holders thereof ("Optional Conversion"), at any time before the Mandatory
Conversion Date, unless previously redeemed, into shares of Common Stock at a
rate of 41.665 shares of Common Stock for each share of PRIDES (the "PRIDES
Optional Conversion Rate"), subject to adjustment as set forth below. The right
of Optional Conversion of shares of PRIDES called for redemption shall terminate
immediately before the close of business on any redemption date with respect to
such shares.
<PAGE>
Optional Conversion of shares of PRIDES may be effected by delivering
certificates evidencing such shares of PRIDES, together with written notice of
conversion and a proper assignment of such certificates to the Corporation or in
blank (and, if applicable, cash payment of an amount equal to the Preferred
Dividend attributable to the current quarterly dividend period payable on such
shares), to the office of the transfer agent for the shares of PRIDES or to any
other office or agency maintained by the Corporation for that purpose and
otherwise in accordance with Optional Conversion procedures established by the
Corporation. Each Optional Conversion shall be deemed to have been effected
immediately before the close of business on the date on which the foregoing
requirements shall have been satisfied. The Optional Conversion shall be at the
PRIDES Optional Conversion Rate in effect at such time and on such date.
Holders of shares of PRIDES at the close of business on a record date for
any payment of declared Preferred Dividends shall be entitled to receive the
Preferred Dividend payable on such shares of PRIDES on the corresponding
Dividend Payment Date notwithstanding the Optional Conversion of such shares of
PRIDES following such record date and before such Dividend Payment Date.
However, shares of PRIDES surrendered for Optional Conversion after the close of
business on a record date for any payment of declared Preferred Dividends and
before the opening of business on the next succeeding Dividend Payment Date must
be accompanied by payment in cash of an amount equal to the Preferred Dividends
attributable to the current quarterly dividend period payable on such date
(unless such shares of PRIDES are subject to redemption on a redemption date
between such record date established for such Dividend Payment Date and such
Dividend Payment Date). Except as provided above, upon any Optional Conversion
of shares of PRIDES, the Corporation shall make no payment of or allowance for
unpaid Preferred Dividends, whether or not in arrears, on such shares of PRIDES
as to which Optional Conversion has been effected or for previously declared
dividends or distributions on the shares of Common Stock issued upon Optional
Conversion.
(d) The PRIDES Common Equivalent Rate, the PRIDES Minimum Redemption Rate
and the PRIDES Optional Conversion Rate (collectively, referred to as the
"Rates") are each subject to adjustment from time to time as provided below in
this paragraph (d).
(i) If the Corporation shall pay a stock dividend or make a
distribution with respect to its Common Stock in shares of Common Stock
(including by way of reclassification of any shares of its Common Stock),
the Rates in effect at the opening of business on the day following the
date fixed for the determination by stockholders entitled to receive such
dividend or other distribution shall each be increased by multiplying such
Rates by a fraction of which the numerator shall be the sum of the number
of shares of Common Stock outstanding at the close of business on the date
fixed for such determination, immediately before such dividend or
distribution, plus the total number of shares of Common Stock constituting
such dividend or other distribution, and of which the denominator shall be
the number of shares of Common Stock outstanding at the close of business
on the date fixed for such determination, immediately before such dividend
or distribution, such increase to become effective immediately after the
opening of business on the day following the date fixed for such
determination. For the purposes of this clause (i), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Corporation but shall include shares issuable in respect of
certificates issued in lieu of fractions of shares of Common Stock.
(ii) In case outstanding shares of Common Stock shall be subdivided or
split into a greater number of shares of Common Stock, the Rates in effect
at the opening of business on the day following the day upon which such
subdivision becomes effective shall each be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall be combined
into a smaller number of shares of Common Stock, the Rates in effect at the
opening of business on the day following the day upon which such
combination becomes effective shall each be proportionately reduced, such
increases or reductions, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective.
<PAGE>
(iii) If the Corporation shall, after the date of this Certificate of
Designations, issue rights or warrants to all holders of its Common Stock
entitling them (for a period not exceeding 45 days from the date of such
issuance) to subscribe for or purchase shares of Common Stock at a price
per share less than the Current Market Price of the Common Stock
(determined pursuant to Section 3(b)(ii)) on the record date for the
determination of stockholders entitled to receive such rights or warrants,
then in each case the Rates shall be adjusted by multiplying the Rates in
effect on such record date by a fraction of which the numerator shall be
the number of shares of Common Stock outstanding on the date of issuance of
such rights or warrants, immediately before such issuance, plus the number
of additional shares of Common Stock offered for subscription or purchase
pursuant to such rights or warrants, and of which the denominator shall be
the number of shares of Common Stock outstanding on the date of issuance of
such rights or warrants, immediately before such issuance, plus the number
of shares of Common Stock which the aggregate offering price of the total
number of shares of Common Stock so offered for subscription or purchase
pursuant to such rights or warrants would purchase at such Current Market
Price (determined by multiplying such total number of shares by the
exercise price of such rights or warrants and dividing the product so
obtained by such Current Market Price). Shares of Common Stock held by the
Corporation or by another corporation of which a majority of the shares
entitled to vote in the election of directors are held, directly or
indirectly, by the Corporation shall not be deemed to be outstanding for
purposes of such computation. Such adjustments shall become effective at
the opening of business on the business day next following the record date
for the determination of stockholders entitled to receive such rights or
warrants. To the extent that shares of Common Stock are not delivered after
the expiration of such rights or warrants, the Rates shall each be
readjusted to the Rates which would then be in effect had the adjustments
made after the issuance of such rights or warrants been made upon the basis
of issuance of rights or warrants in respect of only the number of shares
of Common Stock actually delivered.
(iv) If the Corporation shall pay a dividend or make a distribution to
all holders of its Common Stock consisting of evidences of its
indebtedness, cash or other assets (including shares of capital stock of
the Corporation other than Common Stock but excluding any cash dividends or
distributions, other than Extraordinary Cash Distributions (as defined
herein) and dividends referred to in clauses (i) and (ii) above), or shall
issue to all holders of its Common Stock rights or warrants to subscribe
for or purchase any of its securities (other than those referred to in
clause (iii) above), then in each such case, the Rates shall each be
adjusted by multiplying such Rates in effect on the record date for such
dividend or distribution or for the determination of stockholders entitled
to receive such rights or warrants, as the case may be, by a fraction of
which the numerator shall be the Current Market Price per share of the
Common Stock (determined pursuant to 3(b)(ii) an such record date), and of
which the denominator shall be such Current Market Price per share of
Common Stock less either (i) the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive) on such record
date of the portion of the assets or evidences of indebtedness so
distributed, or of such subscription rights or warrants, applicable to one
share of Common Stock, or (ii) if applicable, the amount of the
Extraordinary Cash Distributions. Such adjustment shall become effective on
the opening of business on the business day next following the record date
for such dividend or distribution or for the determination of holders
entitled to receive such rights or warrants, as the case may be.
(v) Any shares of Common Stock issuable in payment of a dividend or
other distribution shall be deemed to have been issued immediately before
the close of business on the record date for such dividend or other
distribution for purposes of calculating the number of outstanding shares
of Common Stock under this Section 3.
<PAGE>
(vi) Anything in this Section 3 notwithstanding, the Corporation shall
be entitled (but shall not be required) to make such upward adjustments in
the Rates and the PRIDES Call Price in addition to those set forth by this
Section 3, as the Corporation, in its sole discretion, shall determine to
be advisable, in order that any stock dividends, subdivision of stock,
distribution of rights to purchase stock or securities, or distribution of
securities convertible into or exchangeable for stock (or any transaction
that could be treated as any of the foregoing transactions pursuant to
Section 305 of the Internal Revenue Code of 1986. as amended) hereafter
made by the Corporation to its stockholders shall not be taxable. The term
"Extraordinary Cash Distribution" means, with respect to any consecutive
12-month period, all cash dividend and cash distributions on the Common
Stock during such period (other than cash dividends and cash distributions
for which a prior adjustment to the Rates was previously made) to the
extent such dividends and distributions exceed, on a per share of Common
Stock basis, 10% of the average daily Closing Price of the Common Stock
over such period.
(vi) In any case in which this Section 3(d) shall require that an
adjustment as a result of any event become effective at the opening of
business on the business day next following a record date and the date
fixed for conversion pursuant to Section 3(a) or redemption pursuant to
Section 3(b) on and after such record date, but before the occurrence of
such event, the Corporation may, in its sole discretion, elect to defer the
following until after the occurrence of such event: (A) issuing to the
holder of any shares of PRIDES surrendered for conversion or redemption the
fractional shares of Common Stock issuable before giving effect to such
adjustment; and (B) paying to such holder any amount in cash in lieu of a
fractional share of Common Stock pursuant to Section 4.
(viii) All adjustments to the Rates shall be calculated to the nearest
1/100th of a share of Common Stock. No adjustment in any of the Rates shall
be required unless such adjustment would require an increase or decrease of
at least one percent therein; provided, however, that any adjustments which
by reason of this Section 3(d) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All
adjustments to the Rates shall be made successively.
(ix) Before redeeming any shares of PRIDES, the Corporation shall take
any corporate action which may, in the opinion of its counsel, be necessary
in order that the Corporation may validly and legally issue fully paid and
nonassessable shares of Common Stock upon such redemption.
(e) In case of any consolidation or merger to which the Corporation is a
party (other than a consolidation or merger in which the Corporation is the
surviving or continuing corporation and in which the shares of Common Stock
outstanding immediately before the merger or consolidation remain unchanged) or
in the case of any sale or transfer to another corporation of the property of
the Corporation as an entirety or substantially as an entirety, or in the case
of a statutory exchange of securities with another corporation (other than in
connection with a merger or acquisition), each share of PRIDES shall, after
consummation of such transaction, be subject to (i) conversion at the option of
the holder into the kind and amount of securities, cash, or other property
receivable upon consummation of such transaction by a holder of the number of
shares of Common Stock into which such share of PRIDES might have been converted
immediately before consummation of such transaction, (ii) conversion on the
Mandatory Conversion Date into the kind and amount of securities, cash, or other
property receivable upon consummation of such transaction by a holder of the
number of shares of Common Stock into which such share of PRIDES would have been
converted if the conversion on the Mandatory Conversion Date had occurred
immediately before the date of consummation of such transaction, plus the right
to receive cash in an amount equal to all accrued and unpaid dividends on such
share of PRIDES (other than previously declared dividends payable to a holder of
record as of a prior date), and (iii) redemption on any redemption date in
exchange for the kind and amount of securities, cash, or other property
receivable upon consummation of such transaction by a holder of the number of
shares of Common Stock that would have been issuable at the PRIDES Call Price in
effect on such redemption date upon a redemption of such share of PRIDES
immediately before consummation of such transaction, assuming that, if the
Notice Date for such redemption is not before such transaction, the Notice Date
had been the date of such transaction; and assuming in each case that such
holder of shares of Common Stock failed to exercise rights of election, if any,
as to the kind or amount of securities, cash, or other property receivable upon
consummation of such transaction (provided that, if the kind or amount of
securities, cash, or other property receivable upon consummation of such
transaction is not the same for each non-electing share, then the kind and
amount of securities, cash, or other property receivable upon consummation of
such transaction for each non-electing share shall be deemed to be the kind and
amount so receivable per share by a plurality of the non-electing shares). The
kind and amount of securities into or for which the shares of PRIDES shall be
convertible or redeemable after consummation of such transaction shall be
subject to adjustment as described in Section 3(d) following the date of
consummation of such transaction. The Corporation may not become a party to any
such transaction unless the terms thereof are consistent with the foregoing.
<PAGE>
(f) Whenever the Rates are adjusted as provided in Section 3(d), the
Corporation shall:
(i) forthwith compute the Rates in accordance with this Section 3 and
prepare a certificate signed by the Chief Financial Officer, any Vice
President, the Treasurer or the Controller of the Corporation setting forth
the adjusted Rates, the method of calculation thereof in reasonable detail
and the facts requiring such adjustment and upon which such adjustment is
based, which certificate shall be conclusive, final and binding evidence of
the correctness of the adjustment, and shall rile such certificate
forthwith with the transfer agent for the shares of the PRIDES and the
Common Stock;
(ii) make a prompt public announcement stating that the Rates have
been adjusted and setting forth the adjusted Rates; and
(iii) mail a notice stating that the Rates have been adjusted, the
facts requiring such adjustment and upon which such adjustment is based and
setting forth the adjusted Rates, to the holders of record of the
outstanding shares of PRIDES, at or prior to the time the Corporation mails
an interim statement, if any, to its stockholders covering the fiscal
quarter period during which the facts requiring such adjustment occurred,
but in any event within 45 days of the end of such fiscal quarter period.
(g) In case, at any time while any of the shares of PRIDES are outstanding,
(i) the Corporation shall declare a dividend (or any other
distribution) on the Common Stock, excluding any cash dividends other than
Extraordinary Cash Distributions; or
(ii) the Corporation shall authorize the issuance to all holders of
the Common Stock of rights or warrants to subscribe for or purchase shares
of the Common Stock or of any other subscription rights or warrants, or
(iii) the Corporation shall authorize any reclassification of the
Common Stock (other than a subdivision or combination thereof) or any
consolidation or merger to which the Corporation is a party and for which
approval of any stockholders of the Corporation is required (except for a
merger of the Corporation into one of its subsidiaries solely for the
purpose of changing the corporate domicile of the Corporation to another
state of the United States and in connection with which there is no
substantive change in the rights or privileges of any securities of the
Corporation other than changes resulting from differences in the corporate
statutes of the state the Corporation was then domiciled in and the new
state of domicile), or the sale or transfer of all or substantially all of
the assets of the Corporation;
then the Corporation shall cause to be filed at each office or agency maintained
for the purpose of conversion of the shares of PRIDES, and shall cause to be
mailed to the holders of shares of PRIDES at their last addresses as they shall
appear on the stock register of the Corporation, at least 10 business days
before the date hereinafter specified in clause (A) or (B) below (or the earlier
of the dates hereinafter specified, in the event that more than one date. is
specified), a notice stating (A) the date on which a record is to be taken for
the purpose of such dividend, distribution, rights or warrants, or, if a record
is not to be taken, the date as of which the holders of Common Stock of record
to be entitled to such dividend, distribution, rights or warrants are to be
determined, or (B) the date on which any such reclassification, consolidation,
merger, sale, transfer, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their Common Stock for securities
or other property (including cash), if any, deliverable upon such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up. The failure to give or receive the notice required by
this paragraph (g) or any defect therein shall not affect the legality or
validity of any such dividend, distribution, right or warrant or other action.
<PAGE>
Section 4. Conversion into Series U Preferred Stock. (a) In the event a
holder of shares of the PRIDES shall become an Electric Utility Interest (as
defined below), each share of PRIDES held by such holder shall, automatically
and immediately and without further action either by the holder or by the
Corporation, be converted into that number of shares of Common Stock into which
such shares of PRIDES would then be convertible at the PRIDES Optional
Conversion Rate. Upon conversion, the holder of the converted stock shall not be
recognized as a holder of PRIDES for any purpose whatsoever, including, but not
limited to, the right to vote such shares of PRIDES or to receive dividends or
other distributions in respect thereof, if any, but such stockholder shall
thereafter be recognized as a holder of Common Stock, subject to all terms and
restrictions contained in the Restated Certificate of Incorporation, including
automatic and immediate conversion into sham of Series U Preferred Stock and
redemption as provided in Section 4.7 of the Corporation's Restated Certificate
of Incorporation.
(b) For the purpose of this Certificate of Designation, the term
"Electric Utility Interest" means an electric utility or utilities or an
electric utility holding company or companies, or any affiliate of either,
in each case as those terms are utilized by the Federal Energy Regulatory
Commission ("FERC") in regulations or orders implementing the Public
Utility Regulatory Policies Act of 1978, as amended, and its successors,
and the regulations promulgated thereunder ("PURPA"), if such entity's
interest in the Corporation would be a utility interest for purposes of 18
C.F.R. Section 292.206.
Section 5. No Fractional Shares. (a) No fractional shares of Common
Stock shall be issued upon redemption or conversion of any shares of the
PRIDES. In lieu of any fractional share otherwise issuable in respect of
the aggregate number of shares of the PRIDES of any holder that are
redeemed or converted on any redemption date or upon Mandatory Conversion
or Optional Conversion, such holder shall be entitled to receive an amount
in cash (computed to the nearest cent) equal to the same fraction of the
(i) Current Market Price of the Common Stock (determined as of the second
Trading Day immediately preceding the Notice Date) in the case of
redemption, or (ii) Closing Price of the Common Stock determined (A) as of
the fifth Trading Day immediately preceding the Mandatory Conversion Date,
in the case of Mandatory Conversion, or (B) as of the second Trading Day
immediately preceding the effective date of conversion, in the case of an
Optional Conversion by a holder. If more than one share of PRIDES shall be
surrendered for conversion or redemption at one time by or for the same
holder, the number of full shares of Common Stock issuable upon conversion
thereof shall be computed on the basis of the aggregate number of shares of
the PRIDES so surrendered or redeemed.
(b) No fractional shares of PRIDES shall be tendered for redemption or
conversion, or issued upon redemption or conversion of any shares of
PRIDES, except by or to a depositary (the "Depositary") selected by the
Corporation pursuant to a deposit agreement between the Corporation and the
Depositary relating to the execution and delivery of depositary receipts
representing interests in shares of PRIDES deposited by the Corporation
with the Depositary. In lieu of any fractional shares of PRIDES that would
otherwise be issuable to any person other than the Depositary upon the
redemption or conversion of a share of PRIDES, such person shall be
entitled to receive the maximum number of full shares of Common Stock then
issuable upon such redemption or conversion and, in lieu of any fractional
share of Common Stock, an amount in cash computed as provided in Section
5(a).
Section 6. Reservation of Common Stock. The Corporation shall at all
times reserve and keep available out of its authorized and unissued Common
Stock, solely for issuance upon the conversion or redemption of shares of
PRIDES, as herein provided, free from preemptive rights, such maximum
number of shares of Common Stock as shall from time to time be issuable
upon the Mandatory Conversion or Optional Conversion or redemption of all
the shares of PRIDES then outstanding.
Section 7. Definitions. As used in this Certificate of Designations:
(i) the term "business day" shall mean any day other than a Saturday,
Sunday, or a day on which banking institutions in the State of New York are
authorized or obligated by law or executive order to close;
(ii) the term "Closing Price", on any day, shall mean the average of
the closing bid and asked prices of the Common Stock on the Nasdaq National
Market, or if not so available, as furnished by any New York Stock Exchange
member firm selected from time to time by the Board of Directors for that
purpose;
<PAGE>
(iii) the term "record date" shall be such date as from time to time
shall be fixed by the Board of Directors with respect to the receipt of
dividends, the receipt of a redemption price upon redemption or the taking
of any action or exercise of any voting rights permitted hereby; and
(iv) the term "Trading Day" shall mean a date on which the Nasdaq
National Market (or any successor) is open for the transaction of business.
Section 8. Payment of Taxes. The Corporation shall pay any and all
documentary, stamp or similar issue or transfer taxes payable in respect of the
issue or delivery of shares of Common Stock on the redemption or conversion of
shares of PRIDES pursuant to Section 3; provided, however, that the Corporation
shall not be required to pay any tax which may be payable in respect of any
registration of transfer involved in the issue or delivery of shares of Common
Stock in a name other than that of the registered holder of shares of PRIDES
redeemed or converted or to be redeemed or converted, and no such issue or
delivery shall be made unless and until the person requesting such issue has
paid to the Corporation the amount of any such tax or has established. to the
satisfaction of the Corporation, that such tax has been paid.
Section 9. Liquidation Rights. In the event of any voluntary or involuntary
liquidation, dissolution, or winding up of the Corporation, and subject to the
rights of holders of any other series of Preferred Stock, the holders of
outstanding shares of PRIDES are entitled to receive the sum of $1,012.50 per
share, plus an amount equal to any accrued and unpaid Preferred Dividends
thereon, out of the assets of the Corporation available for distribution to
stockholders, before any distribution of assets is made to holders of Junior
Stock. If upon any voluntary or involuntary liquidation, dissolution, or winding
up of the Corporation, the assets of the Corporation are insufficient to permit
the payment of the full preferential amounts payable with respect to the shares
of PRIDES and all other series of Parity Preferred Stock, the holders of shares
of PRIDES and of all other series of Parity Preferred Stock shall share ratably
in any distribution of assets of the Corporation in proportion to the full
respective preferential amounts to which they are entitled. After payment of the
full amount of the liquidating distribution to which they are entitled, the
holders of shares of PRIDES shall not be entitled to any further participation
in any distribution of assets by the Corporation. A consolidation or merger of
the Corporation with or into one or more other corporations (whether or not the
Corporation is the corporation surviving such consolidation or merger), or a
sale, lease or exchange of all or substantially all Of the assets of the
Corporation shall not be deemed to be a voluntary or involuntary liquidation,
dissolution, or winding up of the Corporation.
Section 10. Voting Rights. (a) The holders of shares of PRIDES shall have
the right with the holders of Common Stock to vote in the election of directors
and upon each other matter coming before any meeting of the holders of Common
Stock on the basis of 40 votes for each share of PRIDES held. The holders of
shares of PRIDES and the holders of Common Stock shall vote together as one
class on such matters except as otherwise provided by law or by the Restated
Certificate of Incorporation.
(b) In the event that dividends on the shares of PRIDES or any other
series of Preferred Stock shall be in arrears and unpaid for six quarterly
dividend periods, or if any series of Preferred Stock (other than the
PRIDES) shall be entitled for any other reason to exercise voting rights,
separate from the Common Stock, to elect any directors of the Corporation
("Preferred Stock Directors"), the holders of the shares of PRIDES (voting
separately as a class with holders of all other series of Preferred Stock
upon which like voting rights have been conferred and arc exercisable),
with each share of PRIDES entitled to one vote on this and other matters in
which Preferred Stock votes as a group, shall be entitled to vote for the
election of two directors of the Corporation, such directors to be in
addition to the number of directors constituting the Board of Directors
immediately before the accrual of such right. Such right, when vested,
shall continue until all cumulative dividends accumulated and payable on
the shares of PRIDES and such other series of Preferred Stock shall have
been paid in full and the right of any other series of Preferred Stock to
exercise voting rights, separate from the Common Stock, to elect Preferred
Stock Directors shall terminate or have terminated, and, when so paid and
any such termination occurs or has occurred, such right of the holders of
the shares of PRIDES shall cease. The term of office of any directors
elected by the holders of the shares of PRIDES and such other series shall
terminate on the earlier of (i) the next annual meeting of stockholders at
which a successor shall have been elected and qualified or (ii) the
termination of the right of holders of the shares of PRIDES and such other
series to vote for such directors.
<PAGE>
(c) The Corporation shall not, without the approval of the holders of
at least 66-2/3 percent of the shares of PRIDES then outstanding: (i)
amend, alter, or repeal any of the provisions of the Restated Certificate
of Incorporation or Restated By-Laws of the Corporation so as to affect
adversely the powers, preferences or rights of the holders of the shares of
PRIDES then outstanding or reduce the minimum time for any required notice
to which the holders of the shares of PRIDES then outstanding may be
entitled (an amendment of the Restated Certificate of Incorporation to
authorize or create, or to increase the authorized amount of, Junior Stock
or any stock of any class ranking on a parity with the PRIDES being deemed
not to affect adversely the powers, preferences, or rights of the holders
of the shares of PRIDES); (ii) authorize or create, or increase the
authorized amount of, any stock (whether or not convertible into capital
stock of any class), ranking prior to the shares of PRIDES either as to the
payment of dividends or the distribution of assets upon liquidation,
dissolution or winding up of the Corporation; or (iii) merge or consolidate
with or into any other corporation, unless each holder of shares of PRIDES
immediately preceding such merger or consolidation shall receive or
continue to hold in the resulting corporation the same number of shares,
with substantially the same rights and preferences, as correspond to the
shares of PRIDES so held.
(d) The Corporation shall not, without the approval of the holders of
at least a majority of the shares of PRIDES then outstanding, increase the
authorized number of shares of Preferred Stock to greater than 10,000,000
shares.
(e) Notwithstanding the provisions set forth in Sections 10(c) and
10(d), no such approval described therein of the holders of the shares of
PRIDES shall be required if, at or before the time when such amendment,
alteration or repeal is to take effect or when the authorization, creation,
increase or issuance of any such prior or parity stock or convertible
security is to be made, or when such consolidation or merger, voluntary
liquidation, dissolution, or winding up. sale. lease. conveyance, purchase,
or redemption is to take effect, as the case may be, provision is made for
the redemption of all shares of PRIDES at the time outstanding.
Section 11. Prohibition of Electric Utility Ownership of PRIDES. (a) Any
attempted sale, transfer, assignment, conveyance, pledge or other dispositions
of any share of PRIDES to any Electric Utility Interest (as defined in Section
4(b) herein) shall be null and void ab initio. No employee or agent, including
any independent transfer agent or registrar of the Corporation, shall be
permitted to record any attempted or purported transfer made in violation of the
Section 11, and no intended transferee of shares of the PRIDES attempted to be
transferred in violation of this Section 11 shall be recognized as a holder of
such shares for any purpose whatsoever, including, but not limited to, the right
to vote such shares of PRIDES or to receive dividends or other distributions in
respect thereof, if any. The transferor and any such intended transferee shall
be deemed to have appointed the Corporation as attorney-in-fact, with full power
and substitution and full power and authority, in the name and on behalf of the
intended transferor and transferee, to sell, assign and transfer the shares of
PRIDES attempted to be transferred in violation of this Section 11, and to do
all lawful acts and execute all documents deemed necessary of advisable to
effect such sale, assignment and transfer, in an arm's length transaction, to
another entity or person; provided that the sale, assignment and transfer to
such other entity or person does not violate the provisions of this Section 11.
The Corporation shall apply the proceeds of any such sale first, to pay the
expenses of the sale; second, to pay the intended transferee on whose behalf the
shares were sold, an amount equal to (i) the sum of the intended transferee's
cost of such shares (inclusive of brokerage fees and expenses), plus interest on
such costs at the then minimum rate of interest which would prevent interest on
a non-interest bearing obligation from being imputed by the Internal Revenue
Service, less the amount of any dividends or other distribution inadvertently
paid to said intended transferee in respect of such shares, or (ii) the balance
of such proceeds, whichever is less; and third, the balance of such proceeds, if
any, shall be paid to the Corporation. Notwithstanding the foregoing, the
Corporation shall not provide any proceeds to the intended transferee, if such
intended transferee has received consideration from any subsequent attempted
transfer.
(b) The Corporation shall take all appropriate legal action to enforce
the provisions of this Section 11 in every case where there has been an
attempted or purported transfer made in violation hereof. In taking any
action hereunder, the Corporation, and its directors, officers and agents,
will be fully protected in relying upon any notice, paper or other document
reasonably believed by the Corporation or any such person to be genuine and
sufficient, and, to the extent permitted by law, in no event shall the
Corporation, or any of is directors, officers or agents, be liable for any
act performed or omitted to be performed hereunder in the absence of gross
negligence or willful misconduct. The Corporation and each of its
directors, officers and agents may consult with counsel in connection with
its respective duties hereunder and, to the extent permitted by law, each
shall be fully protected by any act taken, suffered or permitted in good
faith in accordance with the advice of such counsel.
<PAGE>
(c) Whenever it is deemed by the Board of Directors to be prudent in
protecting, preserving, or obtaining for any of its projects (including
projects in which the Corporation or a subsidiary has an interest, whether
by ownership, lease or contract) the status of a "Qualifying Facility" (as
defined in PURPA), the Board of Directors of the Corporation may require to
be filed with Corporation as a condition to permit any proposed transfer,
and/or the registration of any transfer of any shares of the Corporation's
PRIDES a statement or affidavit from any proposed transferee to the effect
that such transferee is not an Electric Utility Interest, as defined
herein.
(d) The Board of Directors of the Corporation shall have the right to
determine whether any transferee or purported transferee of shares of
PRIDES is an Electric Utility Interest and to determine whether the
Corporation's projects (including projects in which the Corporation or a
subsidiary has an interest, whether by ownership, lease or contract) meet
the requirements for Qualifying Facility status under PURPA.
(e) Nothing contained in this Section 11 shall limit the authority of
the Board of Directors of the Corporation to take such other action as it
deems necessary or advisable to protect the Corporation and the interests
of its stockholders by protecting, preserving or obtaining for any of the
Corporation's projects (including projects in which the Corporation or a
subsidiary has an interest, whether by ownership, lease or contract) the
status of a "Qualifying Facility" under PURPA.
(f) All certificates representing shares of the PRIDES shall bear a
legend in substantially the following form:
"Any attempted sale, transfer, assignment, conveyance, pledge or other
disposition of any of the shares of PRIDES represented by this
certificate to any "Electric Utility Interest" (as hereinafter
defined) shall be null and void ab initio in accordance with the
provisions of the Certificate of Designations, Preferences, Rights and
Limitations relating to the PRIDES (the "Certificate of
Designations"). In the event a holder of shares of the PRIDES shall
become an Electric Utility Interest, each share of PRIDES held by such
holder shall be automatically and immediately converted into the
Corporation's Common Stock at the then applicable Common Equivalent
Rate (as defined in the Certificate of Designations) and without
further action either by the holder or by the Corporation, and such
Common Stock shall thereupon be further automatically and immediately
converted into an equal number of shares of the Corporation's Series U
Preferred Stock, and shall be subject to redemption as provided in
Article 4.7 of the Corporation's Restated Certificate of
Incorporation. For these purposes, the term "Electric Utility
Interest" means an electric utility or utilities or an electric
utility holding company or companies, or any affiliate of either, in
each case as those terms are utilized by the Federal Energy Regulatory
Commission ("FERC') in regulations or orders implementing the Public
Utility Regulatory Policies Act of 1978, as amended, and its
successors, and the regulations promulgated hereunder ("PURPA"), if
such entity's interest in the Corporation would be a utility interest
for purposes of 18 C.F.R. Section 292.206.'"
IN WITNESS WHEREOF, KENETECH Corporation has caused this certificate
to be signed and attested this 4th day of May, 1994.
KENETECH CORPORATION
Attested By: s/ Mark Lerdal
Vice President and
Secretary
Signed:
s/ Maurice E. Miller
Maurice E. Miller,
Executive Vice President and
Chief Financial Officer
<PAGE>
RESTATED CERTIFICATE OF INCORPORATION
OF
KENETECH CORPORATION
KENETECH Corporation (the "Corporation"), a corporation organized and
existing under the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:
FIRST: The original Certificate of Incorporation of USW, Inc. (the original
name of the Corporation) was filed with the Secretary of State of the State of
Delaware on February 25, 1986. Such Certificate of Incorporation was restated by
Restated Certificate of Incorporation of USW, Inc., which was filed with the
Secretary of State of the State of Delaware on March 13, 1988, and was amended
by Certificate of Amendment filed with the Secretary of State of the State of
Delaware on June 10, 1991, and by Certificate of Second Amendment filed with the
Secretary of State of the State of Delaware on June 17, 1992, and by Certificate
of Third Amendment filed with the Secretary of State of the State of Delaware on
June 30, 1993. A Certificate of Designations, Preferences and Rights of the $40
Cumulative Convertible Preferred Stock of the Corporation was filed with the
Secretary of State of the State of Delaware on June 26, 1992, and was amended by
Certificate of First Amendment to Certificate of Designations, Preferences and
Rights which was filed with the Secretary of State of the State of Delaware on
September 29, 1992. All of the above documents are, for purposes of this
restatement, deemed to comprise the "Certificate of Incorporation."
SECOND: This Restated Certificate of Incorporation has been duly adopted in
accordance with the provisions of Sections 242 and 245 of the General
Corporation Law of the State of Delaware by the Board of Directors of the
Corporation.
THIRD: This Restated Certificate of Incorporation was approved by the
stockholders pursuant to Section 228 of the General Corporation Law of the State
of Delaware.
FOURTH: The Certificate of Incorporation of the Corporation is amended and
restated in its entirety to read as follows:
Article 1. NAME
The name of the corporation (hereinafter called the "Corporation") is
KENETECH CORPORATION.
Article 2. REGISTERED OFFICE AND AGENT
The address of its registered office in the State of Delaware is the
Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County
of New Castle, Delaware 19801. The name of its registered agent at such address
is the Corporation Trust Company.
Article 3. PURPOSE
The purpose of the Corporation is to engage in any lawful act or activity
for which a corporation may be organized under the General Corporation Law of
Delaware.
Article 4. SHARES
4.1. Authorized Stock. The Corporation is authorized to issue two classes
of stock, denominated Common Stock and Preferred Stock. The Common Stock shall
have a par value of $0.0001 per share, and the Preferred Stock shall have a par
value of $0.01 per share. The total number of shares of Common Stock which the
Corporation is authorized to issue is One Hundred Ten Million (110,000,000), and
the number of shares of Preferred Stock which the Corporation is authorized to
issue is One Hundred Twenty Five Thousand (125,000), which shares shall be
undesignated as to series.
4.2. Conversion of Common Stock. In the event a holder of shares of the
Corporation's Common Stock shall become an Electric Utility Interest (as defined
below), each share of Common Stock held by such holder shall be automatically
and immediately converted into one share of Series U Preferred Stock of the
Corporation without further action either by the holder or by the Corporation.
Upon conversion, the holder of the converted stock shall not be recognized
as a holder of Common Stock for any purpose whatsoever, including, but not
limited to, the right to vote such shares of Common Stock or to receive
dividends or other distributions in respect thereof, if any, but such
stockholder shall thereafter be recognized as a holder of Series U Preferred
Stock.
<PAGE>
For the purposes of this Restated Certificate of Incorporation, the term
"Electric Utility Interest" means an electric utility or utilities or an
electric utility holding company or companies, or any affiliate of either, in
each case as those terms are utilized by the Federal Energy Regulatory
Commission ("FERC") in regulations or orders implementing the Public Utility
Regulatory Policies Act of 1978, as amended, and its successors, and the
regulations promulgated thereunder ("PURPA"), if such entity's interest in the
Corporation would be a utility interest for the purposes of 18 C.F.R. Section
292.206.
4.3. Issuance of Preferred Stock. Any Preferred Stock not previously
designated as to series may be issued from time to time in one or more series
pursuant to a resolution or resolutions providing for such issue duly adopted by
the Board of Directors (authority to do so being hereby expressly vested in the
Board), and such resolution or resolutions shall also set forth the voting
powers, full or limited or none, of each such series of Preferred Stock and
shall fix the designations, preferences and relative, participating, optional or
other special rights and qualifications, limitations or restrictions of each
such series of Preferred Stock. The Board of Directors is authorized to alter
the designation, rights, preferences, privileges and restrictions granted to or
imposed upon any wholly unissued series of Preferred Stock and, within the
limits and restrictions stated in any resolution or resolutions of the Board of
Directors originally fixing the number of shares constituting any series of
Preferred Stock, to increase or decrease (but not below the number of shares of
any such series then outstanding) the number of shares of any such series
subsequent to the issue of shares of that series.
4.4 Dividends. Subject to any preferential rights granted to any series of
Preferred Stock, the holders of shares of the Common Stock shall be entitled to
receive dividends, out of the funds of the Corporation legally available
therefor, at the rate and at the time or times, whether cumulative or
noncumulative, as may be provided by the Board of Directors. The holders of
shares of Series U Preferred Stock shall not be entitled to receive any
dividends. The holders of shares of other Preferred Stock shall be entitled to
receive dividends to the extent provided by the Board of Directors in
designating the particular series of Preferred Stock.
4.5 Voting Rights of Preferred Stock. Except as otherwise required by law,
the holders of shares of Series U Preferred Stock shall not be entitled to vote
on any matter submitted to a vote or consent of the stockholders, including the
election of directors. The voting rights of the holders of shares of a series of
Preferred Stock other than shares of Series U Preferred Stock shall be as set
forth in the certificate or statement of rights and preferences of such series.
4.6 Rights on Liquidation, Dissolution or Winding Up. In the event of any
liquidation, dissolution or winding up of the Corporation, after payment shall
have been made to holders of any series of Preferred Stock then outstanding of
the full amount to which they shall be entitled to be paid before any payment
shall be made to the holders of any shares of Common Stock or any other class or
series of stock ranking junior to the Series U Preferred Stock upon a
liquidation, dissolution or winding up of the Corporation, the holders of shares
of Series U Preferred Stock shall be entitled to receive an amount equal to the
amount per share that would have been payable to such holders if the Corporation
had exercised its right pursuant to Article 4.7 hereof on the date of such
liquidation, dissolution or winding up to redeem outstanding shares of Series U
Preferred Stock. In the event the assets of the Corporation available for
distribution to the holders of Series U Preferred Stock upon any liquidation,
dissolution or winding up of the Corporation shall be insufficient to pay the
full amounts to which the holders of Series U Preferred Stock shall be entitled,
then such assets, or the proceeds thereof, shall be distributed among such
holders ratably in accordance with the respective amounts such holders would be
entitled to receive if they were paid in full. In the event of any liquidation,
dissolution or winding up of the Corporation and after payment shall have been
made to the holders of Series U Preferred Stock of the full amount to which they
shall be entitled as aforesaid, the holders of Common Stock shall be entitled,
to the exclusion of the holders of Series U Preferred Stock, to share in all
remaining assets of the Corporation available for distribution to its
stockholders.
4.7. Redemption.
The Corporation may, at any time and from time to time, redeem any shares
of the Series U Preferred Stock at a redemption price equal to the "Fair Market
Value" (as defined below) of such shares of Series U Preferred Stock. Each date
fixed for redemption pursuant to this Article 4.7 is hereinafter referred to as
a "Preferred Redemption Date."
<PAGE>
For purposes of this Article 4.7, "Fair Market Value" of the Series U
Preferred Stock shall mean the lower of the closing price with respect to a
share of the Corporation's Common Stock on the National Association of
Securities Dealers, Inc. Automated Quotation National Market System, or the
closing sales price or closing bid quotation (whichever is higher) on any
exchange or any system on which the Common Stock is registered or on which it is
qualified to trade, on (i) the date the Series U Preferred Stock to be redeemed
comes into existence as a result of the conversion of the corresponding share of
the Corporation's Common Stock pursuant to Article 4.2 hereof or (ii) the
Preferred Redemption Date. If the Corporation's Common Stock is not then
qualified to trade on any system or listed on any exchange, the Fair Market
Value on the Preferred Redemption Date of such stock shall be determined by the
Board of Directors in good faith.
The total sum payable with respect to any such share to be redeemed is
hereinafter referred to as the "Preferred Redemption Price." The Preferred
Redemption Price is payable on the Preferred Redemption Date established
pursuant to this Article 4.7, and the payment is hereinafter referred to as a
"Preferred Redemption Payment."
In the event the Corporation shall redeem any shares of its Series U
Preferred Stock pursuant hereto, notice of such redemption shall be given by
first-class mail, postage prepaid, mailed not less than thirty (30) days nor
more than sixty (60) days prior to the Preferred Redemption Date, to each holder
of record of the shares to be redeemed at such holder's address as the same
appears on the books of the Corporation; provided, however, that no failure to
mail such notice nor any defect therein shall affect the validity of the
proceeding for the redemption of any shares of Series U Preferred Stock to be
redeemed except as to the holder to whom the Corporation has failed to mail said
notice or except as to the holder whose notice was defective. Each such notice
shall state: (i) the Preferred Redemption Date; (ii) the number of shares of
Series U Preferred Stock to be redeemed from such holder; (iii) the Preferred
Redemption Price; and (iv) the place or places where certificates for such
shares are to be surrendered for payment of the Preferred Redemption Price.
On or after the Preferred Redemption Date stated in a notice delivered
pursuant to the above, a holder of shares of Series U Preferred Stock to be
redeemed shall surrender the certificate or certificates evidencing such shares
to the Corporation at the place designated in such notice and shall, upon
surrender of such certificates or certificates, receive the Preferred Redemption
Payment therefor. In case less than all the shares of preferred stock
represented by any such surrendered certificate or certificates are redeemed, a
new certificate or certificates shall be issued representing the unredeemed
shares.
Article 5. TERM
The Corporation is to have perpetual existence.
Article 6. ELECTION OF DIRECTORS
The election of directors need not be by written ballot unless a
stockholder demands election by written ballot at a meeting of stockholders and
before voting begins or unless the Bylaws of the Corporation shall so provide.
Article 7. NUMBER OF DIRECTORS
The number of directors which constitute the whole Board of Directors of
the Corporation shall be designated in the Bylaws of the Corporation.
Article 8. BYLAWS
In furtherance and not in limitation of the powers conferred by statute,
the Board of Directors is expressly authorized to adopt, amend or repeal the
Bylaws of the Corporation.
Article 9. INDEMNIFICATION OF DIRECTORS
To the fullest extent permitted by the Delaware General Corporation Law as
the same exists or as the same may hereafter be amended, no director of the
Corporation shall be personally liable to the Corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director.
<PAGE>
Neither any amendment nor repeal of this Article, nor the adoption of any
provision of this Restated Certificate of Incorporation inconsistent with this
Article, shall eliminate or reduce the effect of this Article in respect of any
matter occurring, or any cause of action, suit or claim that, but for this
Article, would accrue or arise, prior to such amendment, repeal or adoption of
an inconsistent provision.
Article 10. CLASSIFIED BOARD OF DIRECTORS
At each annual meeting of stockholders, directors of the Corporation shall
be elected to hold office until the expiration of the term for which they are
elected, and until their successors have been duly elected and qualified; except
that if any such election shall not be so held, such election shall take place
at a stockholders meeting called and held in accordance with the Delaware
General Corporation Law. The directors of the Corporation shall be divided into
three classes as nearly equal in size as is practicable, hereby designated Class
I, Class II and Class III. The term of office of the initial Class I directors
shall expire at the next succeeding annual meeting of stockholders, the term of
office of the initial Class II directors shall expire at the second succeeding
annual meeting of stockholders and the term of office of the initial Class III
directors shall expire at the third succeeding annual meeting of the
stockholders. For the purposes hereof, the initial Class I, Class II and Class
III directors shall be those directors so designated and elected at the time of
the effectiveness of this Restated Certificate of Incorporation. At each annual
meeting after this Restated Certificate of Incorporation becomes effective,
directors to replace those of a class whose terms expire at such annual meeting
shall be elected to hold office until the third succeeding annual meeting and
until their respective successors shall have been duly elected and qualified. If
the number of directors is hereafter changed, any newly created directorships or
decrease in directorships shall be so apportioned among the classes as to make
all classes as nearly equal in number as is practicable.
Notwithstanding the foregoing, and except as otherwise required by law,
whenever the holders of any one or more series of Preferred Stock shall have the
right, voting separately as a class, to elect one or more directors of the
Corporation, the provisions of the first paragraph of this Article shall not
apply with respect to the director or directors elected by such holders of
Preferred Stock.
Vacancies occurring on the Board of Directors for any reason may be filled
by vote of a majority of the remaining members of the Board of Directors,
although less than a quorum, at any meeting of the Board of Directors. A person
so elected by the Board of Directors to fill a vacancy shall hold office until
the next succeeding annual meeting of stockholders of the Corporation and until
his or her successor shall have been duly elected and qualified.
Article 11. PROHIBITION ON STOCK OWNERSHIP
BY ELECTRIC UTILITIES
(a) Any attempted sale, transfer, assignment, conveyance, pledge or other
disposition of any share of the Corporation's Common Stock to any Electric
Utility Interest (as defined in Article 4.2 of this Restated Certificate of
Incorporation) shall be null and void ab initio. No employee or agent, including
any independent transfer agent or registrar of the Corporation, shall be
permitted to record any attempted or purported transfer made in violation of
this Article 11, and no intended transferee of shares of the Corporation's
Common Stock attempted to be transferred in violation of this Article 11 shall
be recognized as a holder of such shares for any purpose whatsoever, including,
but not limited to, the right to vote such shares of Common Stock or to receive
dividends or other distributions in respect thereof, if any. The transferor and
any such intended transferee shall be deemed to have appointed the Corporation
as attorney-in-fact, with full power of substitution and full power and
authority, in the name and on behalf of the intended transferor and transferee,
to sell, assign and transfer the shares of Common Stock of the Corporation
attempted to be transferred in violation of this Article 11, and to do all
lawful acts and execute all documents deemed necessary or advisable to effect
such sale, assignment and transfer, in an arm's-length transaction, to another
entity or person; provided that the sale, assignment and transfer to such other
entity or person does not violate the provisions of this Article 11. The
Corporation shall apply the proceeds of any such sale first, to pay the expenses
of the sale; second, to pay the intended transferee on whose behalf the shares
were sold, an amount equal to (i) the sum of the intended transferee's cost of
such shares (inclusive of brokerage fees and expenses), plus interest on such
cost at the then minimum rate of interest which would prevent interest on a
non-interest bearing obligation from being imputed by the Internal Revenue
Service, less the amount of any dividends or other distributions inadvertently
paid to said intended transferee in respect of such shares, or (ii) the balance
of such proceeds, whichever is less; and third, the balance of such proceeds, if
any, shall be paid to the Corporation. Notwithstanding the foregoing, the
Corporation shall not provide any proceeds to the intended transferee, if such
intended transferee has received consideration from any subsequent attempted
transfer.
<PAGE>
(b) The Corporation shall take all appropriate legal action to enforce the
provisions of this Article 11 in every case where there has been an attempted or
purported transfer made in violation hereof. In taking any action hereunder, the
Corporation, and its directors, officers and agents, win be fully protected in
relying upon any notice, paper or other document reasonably believed by the
Corporation or any such person to be genuine and sufficient, and, to the extent
permitted by law, in no event shall the Corporation, or any of its directors,
officers or agents, be Liable for any act performed or omitted to be performed
hereunder in the absence of gross negligence or willful misconduct. The
Corporation and each of its directors, officers and agents may consult with
counsel in connection with its respective duties hereunder and, to the extent
permitted by law, each shall be fully protected by any act taken, suffered or
permitted in good faith in accordance with the advice of such counsel.
(c) Whenever it is deemed by the Board of Directors to be prudent in
protecting, preserving or obtaining for any of its projects (including projects
in which the Corporation or a subsidiary has an interest, whether by ownership,
lease or contract) the status of a "Qualifying Facility" (as defined under
PURPA), the Board of Directors of the Corporation may require to be filed with
the Corporation as a condition to permitting any proposed transfer, and/or the
registration of any transfer, of any shares of the Corporation's Common Stock a
statement or affidavit from any proposed transferee to the effect that such
transferee is not an "Electric Utility Interest," as defined herein.
(d) The Board of Directors of the Corporation shall have the right to
determine whether any transferee or purported transferee of shares of Common
Stock of the Corporation is an "Electric Utility Interest" and to determine
whether the Corporation's projects (including projects in which the Corporation
or a subsidiary has an interest, whether by ownership, lease or contract) meet
the requirements for "Qualifying Facility" status under PURPA.
(e) Nothing contained in this Article 11 shall limit the authority of the
Board of Directors of the Corporation to take such other action as it deems
necessary or advisable to protect the Corporation and the interests of its
stockholders by protecting, preserving or obtaining for any of the Corporation's
projects (including projects in which the Corporation or a subsidiary has an
interest, whether by ownership, lease or contract) the status of a "Qualifying
Facility" under PURPA.
(f) All certificates representing shares of the Corporation's Common Stock
shall bear the following legend:
"Any attempted sale, transfer, assignment, conveyance, pledge or other
disposition of any of the shares represented by this certificate to any
"Electric Utility Interest" (as hereinafter defined) shall be null and void
ab initio, in accordance with the provisions of the Restated Certificate of
Incorporation of the Corporation. In the event a holder of shares of the
Corporation's Common Stock shall become an Electric Utility Interest, each
share of Common Stock held by such holder shall be automatically and
immediately converted into one share of Series U Preferred Stock of the
Corporation without further action either by the holder or by the
Corporation. For these purposes, the term "Electric Utility Interest" means
an electric utility or utilities or an electric utility holding company or
companies, or any affiliate of either, in each case as those terms are
utilized by the Federal Energy Regulatory Commission ("FERC") in
regulations or orders implementing the Public Utility Regulatory Policies
Act of 1978, as amended, and its successors, and the regulations
promulgated thereunder ("PURPA"), if such entity's interest in the
Corporation would be a utility interest for purposes of 18 C.F.R. Section
292.206."
Article 12. MEETINGS AND RECORDS
Meetings of stockholders may be held within or without the State of
Delaware, as the Bylaws may provide. The books of the Corporation may be kept
(subject to any provision contained in the statutes) outside of the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the Bylaws of the Corporation.
Article 13. ACTION BY STOCKHOLDERS
Stockholders of the Corporation may not take action by written consent in
lieu of a meeting but must take any actions at a duly called annual or special
meeting.
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Article 14. AMENDMENTS TO CERTIFICATE OF INCORPORATION
The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Restated Certificate of Incorporation, in the manner
now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation. Notwithstanding any
other provision of this Restated Certificate of Incorporation or any provision
of law which might otherwise permit a lesser vote or no vote, but in addition to
any affirmative vote of the holders of the capital stock required by law or this
Restated Certificate of Incorporation, the affirmative vote of the holders of at
least two-thirds (2/3) of the combined voting power of all of the
then-outstanding shares of the Corporation entitled to vote shall be required to
alter, amend or repeal Articles ELEVEN, THIRTEEN OR FOURTEEN or any provision
thereof, unless such amendment shall be approved by a majority of the directors
of the Corporation not affiliated or associated with any person or entity
holding (or which has announced an intention to obtain) 25% or more of the
voting power of the Corporation's outstanding capital stock.
IN WITNESS WHEREOF, KENETECH CORPORATION has caused this Restated
Certificate of Incorporation to be signed by its Executive Vice President and
attested to by its Secretary this 22nd day of September, 1993.
s/ Maurice E. Miller
Maurice E. Miller
Executive Vice President
[SEAL]
Attested this
22nd day of September, 1993
s/ Mark Lerdal
Mark D. Lerdal
Secretary
