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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
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July 20, 1999 (July 15, 1999)
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Date of Report (Date of earliest event reported)
THE PRESLEY COMPANIES
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(Exact name of registrant as specified in its charter)
Delaware 0-18001 33-0475923
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification Number)
19 Corporate Plaza, Newport Beach, California 92660
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(Address of principal executive offices) (zip code)
(949) 640-6400
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Registrant's telephone number, including area code
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Items 1-4. Not Applicable.
Item 5. Other Events.
On July 20, 1999, The Presley Companies issued a press release, a copy
of which is attached hereto as Exhibit 99.1 announcing (i) the signing of an
amendment and extension to the revised letter of intent, with William Lyon
Homes, Inc., a copy of which is attached hereto as Exhibit 10.34 and (ii) the
approval by the Board of Directors, subject to shareholder approval, of a merger
of The Presley Companies into a newly created wholly-owned subsidiary, Presley
Merger Sub, Inc., a Delaware corporation ("Merger Sub").
A copy of the Certificate of Ownership and Merger is attached hereto as
Exhibit 99.2 and a copy of Merger Sub's Certificate of Incorporation is attached
hereto as Exhibit 99.3.
Item 6. Not Applicable.
Item 7. Exhibits.
Exhibit 10.34 Letter Amendment to Revised Letter of Intent, dated July
15, 1999, by and among William Lyon Homes, Inc. a
California corporation, The Presley Companies, a Delaware
corporation and Presley Homes, a California corporation.
Exhibit 99.1 Press Release dated July 20, 1999.
Exhibit 99.2 Certificate of Ownership and Merger.
Exhibit 99.3 Certificate of Incorporation of Presley Merger Sub, Inc.
Item 8. Not Applicable.
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SIGNATURE
Pursuant to the requirements of Section 13 and 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
Dated: July 20, 1999
THE PRESLEY COMPANIES,
a Delaware corporation
By: /s/ David M. Siegel
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Name: David M. Siegel
Title: Senior Vice President,
Chief Financial Officer
and Treasurer
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EXHIBIT INDEX
Exhibit Description
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10.34 Letter Amendment to Revised Letter of Intent, dated July 15,
1999, by and among William Lyon Homes, Inc. a California
corporation, The Presley Companies, a Delaware corporation
and Presley Homes, a California corporation.
99.1 Press Release Dated July 20, 1999.
99.2 Certificate of Ownership and Merger.
99.3 Certificate of Incorporation of Presley Merger Sub, Inc.
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[LETTERHEAD OF WILLIAM LYON HOMES, INC.]
July 15, 1999
The Presley Companies
19 Corporate Plaza
Newport Beach, California 92660
Attention: General James Dalton
Chairman, Special Committee of the Board of Directors
Re: EXTENSION OF REVISED AGREEMENT IN PRINCIPLE CONCERNING
THE PRESLEY COMPANIES AND WILLIAM LYON HOMES, INC.
Ladies and Gentlemen:
This letter amends the Revised Agreement in Principle, dated May 3,
1999 (the "Letter of Intent"), among William Lyon Homes, Inc., a California
corporation, The Presley Companies, a Delaware corporation, and Presley Homes,
a California corporation. Capitalized terms not otherwise defined herein shall
have the meanings set forth in the Letter of Intent.
The parties to the Letter of Intent hereby extend the term of the
Letter of Intent (as referenced in Section 2(h) and Section 11 thereof) and the
Exclusivity Period (as referenced in Section 4 thereof) to 11:59 p.m. Pacific
time on October 15, 1999. In addition, the parties agree that the references in
Section 3 of the Letter of Intent to the termination date of any Definitive
Agreement shall be changed from August 31, 1999 to November 30, 1999.
If the foregoing is consistent with your understanding and is
satisfactory to you as a basis for proceeding toward a Definitive Agreement,
please so signify on the enclosed copy of this letter and return it to us at
the address indicated hereon.
WILLIAM LYON HOMES, INC.,
A CALIFORNIA CORPORATION
By: /s/ WILLIAM LYON
--------------------------
William Lyon
Chairman, President & CEO
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The Presley Companies -- July 15, 1999 - Page 2
AGREED, AS OF JULY 14, 1999:
THE PRESLEY COMPANIES,
A DELAWARE CORPORATION
By: /s/ NANCY HARLAN
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Nancy Harlan
Senior Vice President and General Counsel
By: /s/ LINDA L. FOSTER
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Linda L. Foster
Vice President and Corporate Secretary
PRESLEY HOMES,
A CALIFORNIA CORPORATION
By: /s/ NANCY HARLAN
-----------------------------------------
Nancy Harlan
Senior Vice President and General Counsel
By: /s/ LINDA L. FOSTER
-----------------------------------------
Linda L. Foster
Vice President and Corporate Secretary
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EXHIBIT 99.1
[LETTERHEAD OF PRESLEY]
Contact: Investor Relations Media Relations
W. Douglass Harris Steven D. Stern
The Presley Companies Pondel/Wilkinson Group
(949) 640-6400 (310) 207-9300
THE PRESLEY COMPANIES ANNOUNCES EXTENSION OF
LETTER OF INTENT WITH WILLIAM LYON HOMES, INC.
BOARD OF DIRECTORS APPROVES, SUBJECT TO
STOCKHOLDER APPROVAL,
MERGER WITH WHOLLY-OWNED SUBSIDIARY
NEWPORT BEACH, CA, -- July 20, 1999 -- The Presley Companies (NYSE:PDC)
announced today that, after approval by a Special Committee of its Board of
Directors, Presley and William Lyon Homes, Inc. have agreed to an extension of
its Revised Letter of Intent to October 15, 1999. The extension also extends the
period in which the parties have agreed (with certain exceptions) to negotiate
exclusively to October 15, 1999.
Presley also announced today that its Board of Directors has approved,
subject to shareholder approval, a merger of Presley into a wholly-owned
subsidiary. The subsidiary will be the surviving company in the merger.
The principal purpose of the proposed merger is to help preserve
Presley's substantial net operating loss carryforwards and other tax benefits
for use in offsetting future taxable income or income tax by decreasing the risk
of an "ownership change" for federal income tax purposes. This will be
accomplished by imposing certain restrictions on the transfer of the surviving
company's stock. These restrictions will be similar to those imposed by several
other public companies for the purpose of preserving their tax benefits against
an "ownership change."
As previously reported, Presley's future use of tax carryforwards would
be severely limited if there were an "ownership change," as defined by the
applicable tax laws and regulations, over any three-year period. While Presley
believes an "ownership change" has not occurred since 1994, there is a risk that
future shifts in ownership, primarily involving present or future holders of 5%
or more of Presley's shares, could result in an "ownership change" as calculated
for federal income tax purposes.
Generally, Presley has no control over purchases or sales by investors
who acquire 5% or more of its shares. However, the merger is being proposed to
reduce the risk of an "ownership change" occurring by restricting certain
transfers of the new company's stock.
In general, if the proposed merger is consummated, the transfer
restrictions will prohibit, without prior approval of the board of directors of
the new company, the direct or indirect disposition or acquisition of any stock
of the company by or to any holder who owns or would so own upon the acquisition
(either directly or through the tax attribution rules) 5% or more of the new
company's stock.
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These restrictions are intended to bind all holders of shares of
Presley's common stock outstanding at the effective time of the proposed merger.
If the proposed merger is consummated, the transfer restrictions on the shares
of the new company will remain in effect for at least three years unless the new
company's board determines that they are no longer needed to preserve the
company's tax benefits.
Transfers of shares of Presley common stock occurring prior to the
effective time of the proposed merger will not be restricted and all holders of
Presley common stock as of such effective time will receive shares of the new
company in exchange for their Presley shares on a proposed one-for-five basis.
However, subsequent dispositions of those company shares will be subject to the
transfer restrictions. Accordingly, if the proposed merger is consummated,
persons who are or become "5% stockholders" of Presley for purposes of the
applicable federal income tax regulations will be prohibited from disposing of
their shares or acquiring additional shares in the new company while the
transfer restrictions are in effect unless the express consent of the board of
directors of the new company is obtained.
The proposed merger will be submitted for approval at a special meeting
of stockholders of Presley which has not yet been called. The proposed merger
will require the approval of a majority of the shares of Presley's Series A and
Series B common stock, voting as a single class. No appraisal rights will be
available in connection with the transaction.
The merger is also subject to a number of other conditions, including
receipt of necessary consents and approvals; receipt of a satisfactory opinion
as to the federal income tax effects of the merger; and consummation of the
other transactions contemplated by the previously announced letter of intent
with William Lyon Homes, Inc.
If the proposed merger is consummated, each share of Series A or Series
B common stock of Presley will be converted into the right to receive 0.2 common
shares of the new company and outstanding stock options will be correspondingly
adjusted. The new company will have the same financial position as that of
Presley immediately before the merger (the merger is expected to take effect
after consummation of the transactions contemplated in the letter of intent with
William Lyon Homes). Except for the transfer restrictions, the new shares will
have terms substantially similar to the old shares.
Presley is not soliciting proxies at this time and the offering of new
shares will be made under the federal securities laws only pursuant to a
registration statement declared effective by the Securities and Exchange
Commission.
The press release may be deemed to contain certain forward-looking
statements with respect to the financial condition of Presley, which involve
risks and uncertainties including, but not limited to, the availability of the
tax benefits referred to herein, and the effect of the proposed transfer
restrictions referred to herein in reducing the risk of a loss of such benefits.
Presley is one of the oldest and largest homebuilders in the Southwest
with development communities in California, Arizona, New Mexico and Nevada.
Founded in 1956, Presley has built and sold more than 47,000 homes and currently
has 42 sales locations. Presley's corporate headquarters are located in Newport
Beach, California.
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EXHIBIT 99.2
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
THE PRESLEY COMPANIES
A DELAWARE CORPORATION
WITH AND INTO
PRESLEY MERGER SUB, INC.
A DELAWARE CORPORATION
The Presley Companies, a corporation organized and existing under the laws
of the State of Delaware, does hereby certify that:
FIRST: The Presley Companies was incorporated on August 7, 1991, pursuant
to the General Corporation Law of the State of Delaware (the "DGCL"), the
provisions of which permit the merger of a parent corporation organized and
existing under the laws of said State with and into a subsidiary corporation
organized and existing under the laws of said State.
SECOND: The Presley Companies owns one hundred percent (100%) of the
outstanding shares of the common stock, $.01 par value per share, of Presley
Merger Sub, Inc., a corporation incorporated on July 15, 1999, pursuant to the
DGCL, and having no class of stock issued and outstanding other than said common
stock.
THIRD: The Board of Directors of The Presley Companies pursuant to a
unanimous written consent dated July 15, 1999 in lieu of a meeting, determined
to merge The Presley Companies with and into Presley Merger Sub, Inc., and did
adopt the following resolutions:
WHEREAS, The Presley Companies (the "Corporation") is the legal and
beneficial owner of one hundred percent (100%) of the outstanding shares of
common stock, $.01 par value per share ("New Presley Common Stock"), of Presley
Merger Sub, Inc., a Delaware corporation ("New Presley");
WHEREAS, the New Presley Common Stock is the only issued and outstanding
class of stock of New Presley;
WHEREAS, this Corporation desires to merge itself with and into New Presley
pursuant to the provisions of Section 253 of the General Corporation Law of the
State of Delaware (the "DGCL"); and
WHEREAS, the Board of Directors of this Corporation deems it advisable and
in the best interests of this Corporation to merge with and into New Presley,
with New Presley as the surviving corporation.
NOW, THEREFORE, BE IT RESOLVED, that effective upon the approval of the
stockholders and the filing of an appropriate Certificate of Ownership and
Merger (the "Certificate of Ownership") embodying these resolutions with the
Secretary of State of Delaware, this Corporation shall merge itself with and
into New Presley, with New Presley being the surviving corporation, which will
assume all of the obligations of this Corporation;
RESOLVED FURTHER, that this Corporation be merged with and into New Presley
and that the merger be, and it hereby is, approved and authorized;
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RESOLVED FURTHER, that the terms and conditions of the merger are as
follows:
ARTICLE 1:
THE MERGER
1.1. The Merger; Effect of Merger. At the Effective Time (as defined in
Section 1.2 below), this Corporation shall be merged with and into New Presley
pursuant to Section 253 of the DGCL and the separate existence of this
Corporation shall cease. New Presley, as the surviving corporation, shall
succeed, insofar as permitted by law, to all rights, assets, liabilities and
obligations of this Corporation in accordance with the DGCL.
1.2. Effective Time. The Effective Time shall be the time at which a duly
executed copy of the Certificate of Ownership with respect to the merger is
filed in the office of the Secretary of State of Delaware in accordance with the
provisions of the DGCL.
1.3. New Presley Certificate of Incorporation. The certificate of
incorporation of New Presley, as in effect immediately prior to the Effective
Time, shall be and remain the certificate of incorporation of New Presley, as
the surviving corporation, following the Effective Time until it shall be
amended as provided by law, except that at the Effective Time, the name of New
Presley shall be changed to The Presley Companies.
1.4. Bylaws. The bylaws of New Presley, as in effect immediately prior to
the Effective Time, shall be and remain the bylaws of New Presley, as the
surviving corporation, following the Effective Time until the same shall be
altered, amended or repealed.
1.5. New Presley's Directors and Officers. The directors and officers,
respectively, of New Presley immediately prior to the Effective Time shall
continue as the directors and officers, respectively, of New Presley following
the Effective Time, to hold office until their successors have been duly elected
and qualified in accordance with the certificate of incorporation and bylaws of
New Presley as the surviving corporation.
ARTICLE 2:
CONVERSION OF SHARES
2.1. New Presley Common Stock. At the Effective Time, automatically by
virtue of the merger and without any further action by any of the parties hereto
or any other person, each five (5) shares of this Corporation's Common Stock
issued and outstanding or held in the treasury of this Corporation immediately
prior to the Effective Time shall be converted into the right to receive one (1)
share of New Presley Common Stock upon compliance with the procedures specified
in Article 3 below; provided, however, no fractional interests shall be issued
by New Presley, and this Corporation shall arrange for the disposition of such
fractional interests by those stockholders otherwise entitled thereto, with cash
paid in lieu of fractional interests by an agent to be appointed by this
Corporation. No shares of this Corporation's Common Stock shall be issued or
outstanding after the Effective Time.
2.2. New Presley Common Stock. At the Effective Time, automatically by
virtue of the merger and without any further action by any of the parties hereto
or any other person, each share of New Presley Common Stock issued and
outstanding and held by this Corporation immediately prior to the Effective Time
shall be cancelled and cease to be issued or outstanding without any payment
being made in respect thereto.
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2.3. Stock Option Plans. At the Effective Time, New Presley shall assume
and continue this Corporation's 1991 Stock Option Plan (the "Stock Option
Plan"), be substituted as the "Company" under the terms and provisions of the
Stock Option Plan and assume all rights and obligations of this Corporation
under the Stock Option Plan as theretofore in effect and all stock options
outstanding thereunder (the "Outstanding Options"). The Stock Option Plan and
the Outstanding Options shall, pursuant to their terms, thereafter apply to
shares of New Presley Common Stock in the same manner as they theretofore
applied to shares of this Corporation's Common Stock, subject to adjustment for
the conversion of the shares of the Corporation's Common Stock in the merger.
Prior to the Effective Time, this Corporation shall take such action with
respect to the Stock Option Plan as is appropriate to facilitate performance of
the foregoing provisions of this Section 2.3.
ARTICLE 3:
EXCHANGE OF STOCK CERTIFICATES
3.1. Appointment of Exchange Agent. At or prior to the Effective Time, New
Presley shall appoint a bank or trust company selected by New Presley as
exchange agent ("Exchange Agent") for the purpose of facilitating the exchange
of certificates representing shares of this Corporation's Common Stock ("Old
Certificates") for certificates representing shares of New Presley Common Stock
("New Presley Certificates") and to act as agent to arrange for the disposition
of fractional interests by those entitled thereto, and distribute such cash in
lieu of fractional interests.
3.2. Exchange of Certificates. As soon as practicable after the Effective
Time, the Exchange Agent shall mail to each holder of record of Old Certificates
a form letter of transmittal (which shall specify that delivery shall be
effected, and risk of loss and title to the Old Certificates shall pass, only
upon delivery of the Old Certificates to the Exchange Agent) and instructions
for use in effecting the surrender of the Old Certificates in exchange for New
Presley Certificates. Upon proper surrender of an Old Certificate for exchange
and cancellation to the Exchange Agent, together with such properly completed
letter of transmittal, duly executed, the holder of such Old Certificate shall
be entitled to receive in exchange therefor a New Presley Certificate
representing one (1) share of New Presley Common Stock for every five (5) shares
represented by the surrendered Old Certificate, with cash paid in lieu of
fractional interests by the Exchange Agent upon the disposition of those
fractional interests.
3.3. Restriction on Payment of Dividends and Distributions. No dividends or
other distributions declared after the Effective Time with respect to New
Presley Common Stock shall be paid to the holder of any unsurrendered Old
Certificate until the holder thereof shall surrender such Old Certificate in
accordance with Section 3.2. After the surrender of an Old Certificate in
accordance with Section 3.2, the record holder thereof shall be entitled to
receive any such dividends or other distributions, without any interest thereon,
which theretofore had become payable with respect to shares of New Presley
Common Stock represented by such Old Certificate. Notwithstanding the foregoing,
to the fullest extent permitted by law, none of New Presley, this Corporation,
the Exchange Agent or any other person shall be liable to any former holder of
shares of this Corporation's Common Stock for any amount properly delivered to a
public official pursuant to applicable abandoned property, escheat or similar
laws.
3.4. Issuance of New Presley Certificate in a Different Name. If any New
Presley Certificate is to be issued in a name other than that in which the Old
Certificate surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the Old Certificate so surrendered shall
be properly endorsed (or accompanied by an appropriate instrument of transfer)
and otherwise in proper form for transfer, and that the person
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requesting such exchange shall pay to the Exchange Agent in advance any transfer
or other taxes required by reason of the issuance of a New Presley Certificate
in any name other than that of the registered holder of the Old Certificate
surrendered, or required for any other reason, or shall establish to the
satisfaction of the Exchange Agent that such tax has been paid or is not
payable.
3.5. No Transfers of this Corporation's Common Stock after the Effective
Time. After the Effective Time, there shall be no transfers on the stock
transfer books of this Corporation of the shares of this Corporation's Common
Stock which were issued and outstanding immediately prior to the Effective Time.
If, after the Effective Time, Old Certificates representing such shares are
presented for transfer, no transfer shall be effected on the stock transfer
books of New Presley with respect to such shares and no New Presley Certificate
shall be issued representing the shares New Presley Common Stock exchangeable
for such shares of this Corporation's Common Stock unless and until such Old
Certificate is delivered to the Exchange Agent together with properly completed
and duly executed copies of all documents required by Section 3.2 (or such other
documents as are satisfactory to New Presley and the Exchange Agent in their
sole discretion).
3.6. Lost Old Certificates. In the event any Old Certificate shall have
been lost, stolen or destroyed, upon the making of an affidavit of that fact by
the person claiming such Old Certificate to be lost, stolen or destroyed and, if
required by New Presley, the posting by such person of a bond in such amount as
New Presley may determine is reasonably necessary as indemnity against any claim
that may be made against it with respect to such Old Certificate, the Exchange
Agent will issue, in exchange for such lost, stolen, or destroyed Old
Certificate, a New Presley Certificate representing the shares of New Presley
Common Stock deliverable in respect of such Old Certificate.
ARTICLE 4:
CONDITIONS TO MERGER
4.1. Conditions to Merger. The consummation of the merger is subject to the
satisfaction, or (to the extent permitted by law) waiver by this Corporation, of
the following conditions prior to the Effective Time:
4.1.1. Consents. Any consents, approvals or authorizations that this
Corporation deems necessary or appropriate to be obtained in connection with the
consummation of the merger shall have been obtained;
4.1.2. Stockholder Approval. The Certificate of Ownership shall have
been adopted by the holders of this Corporation's Common Stock in accordance
with the DGCL;
4.1.3. Tax Opinion. This Corporation shall have received, in form and
substance satisfactory to it, an opinion from its counsel with respect to
certain federal income tax effects of the merger;
4.1.4. Closing of Purchase Agreement. The closing of the purchase and
sale of certain assets of William Lyon Homes, Inc. ("WLHI") to this Corporation
shall have occurred in accordance with that certain Purchase Agreement and
Escrow Instructions, by and among WLHI, this Corporation and Presley Homes, a
California Corporation; and
4.1.5. Closing of Purchase of this Corporation's Common Stock. WLHI
shall have purchased shares of this Corporation's Common Stock pursuant to a
tender offer on a Tender Offer Statement on Schedule 14D-1 and the Series B
Stock Purchase Agreement, between WLHI and certain holders of the Corporation's
Series B Common Stock.
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ARTICLE 5:
AMENDMENT, DEFERRAL AND TERMINATION
5.1. Amendment. Subject to Section 251(d) of the DGCL as incorporated by
reference in Section 253 of the DGCL, the Board of Directors, may amend, modify
or supplement the terms and conditions of the merger prior to the filing of
Certificate of Ownership with the Secretary of State of Delaware.
5.2. Deferral. Consummation of the merger may be deferred by the Board of
Directors of this Corporation or any authorized officer of this Corporation for
a reasonable period of time following the adoption of the Certificate of
Ownership if said Board of Directors or authorized officer determines that such
deferral would be advisable and in the best interests of this Corporation and
its stockholders.
5.3. Termination. The merger may be abandoned at any time prior to the
filing of the Certificate of Ownership with the Secretary of State of Delaware,
whether before or after adoption of the Certificate of Ownership by the
stockholders of this Corporation, by action of the Board of Directors of this
Corporation, if said Board of Directors determines that the consummation of the
merger would not, for any reason, be advisable and in the best interests of this
Corporation and its stockholders.
RESOLVED FURTHER, that this resolution to merge be submitted to the
stockholders of this Corporation at a special meeting to be called and held
after 20 days' or more notice of the purpose thereof; and
RESOLVED FURTHER, that the Chief Executive Officer, President or any Vice
President of this Corporation be and each hereby is authorized to make and
execute the Certificate of Ownership setting forth a copy of these resolutions
providing for the merger of this Corporation into New Presley and the date of
adoption hereof, and to cause the same to be filed with the Secretary of State
and to do all acts and things, whatsoever, whether within or without the State
of Delaware, which may be in any way necessary or appropriate to effect said
merger.
FOURTH: That this merger has been approved by the holders of at least a
majority of the outstanding shares of stock of this Corporation at a meeting
duly called and held after 20 days' notice of the purpose of the meeting mailed
to each such stockholder at the stockholder's address as it appears on the
records of the Corporation.
FIFTH: That upon the effective date of the merger, Article I of the
Certificate of Incorporation of Presley Merger Sub, Inc. shall be amended to
read: "The name of this corporation is The Presley Companies."
IN WITNESS WHEREOF, said Corporation has caused this Certificate to be
signed by Wade H. Cable, its authorized officer, this 15th day of July, 1999.
THE PRESLEY COMPANIES
a Delaware corporation
By: /s/ WADE H. CABLE
-----------------------------------
Name: Wade H. Cable
Title: Chief Executive Officer
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EXHIBIT 99.3
CERTIFICATE OF INCORPORATION
OF
PRESLEY MERGER SUB, INC.
ARTICLE I.
The name of this corporation is Presley Merger Sub, Inc.
ARTICLE II.
The address of this corporation's registered office in the State of
Delaware is 30 Old Rudnick Lane, in the City of Dover, County of Kent 19901. The
name of its registered agent at such address is CorpAmerica, Inc.
ARTICLE III.
The nature of the business or purposes to be conducted or promoted is to
engage in any lawful act or activity for which corporations may be organized
under the Delaware General Corporation Law ("DGCL").
ARTICLE IV.
(A) The total number of shares of all classes of capital stock which this
corporation shall have the authority to issue is thirty five million
(35,000,000) shares, of which thirty million (30,000,000) shares shall be of the
par value of $.01 per share and designated "Common Stock" and five million
(5,000,000) shares shall be of the par value of $.01 per share and designated
"Preferred Stock".
(B) The Board of Directors is expressly authorized at any time, and from
time to time, to provide for the issuance of shares of Preferred Stock in one or
more series, with such number of shares, such voting powers, full or limited, or
without voting powers, and with such designation, preferences and relative,
participating, optional or other special rights, and qualifications, limitations
or restrictions thereof as shall be stated and expressed in the resolution or
resolutions providing for the issue thereof adopted by the Board of Directors,
and as are not stated and expressed in this Certificate of Incorporation, or any
amendment thereto.
ARTICLE V.
The following provisions are inserted for the management of the business
and the conduct of the affairs of the corporation, and for further definition,
limitation and regulation of the powers of the corporation and of its directors
and stockholders:
(A) The business and affairs of the corporation shall be managed by or
under the direction of the Board of Directors. In addition to the powers and
authority expressly conferred upon them by the DGCL or by this Certificate of
Incorporation or the Bylaws of the corporation, the directors are hereby
empowered to exercise all such powers and do all such acts and things as may be
exercised or done by the corporation.
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(B) The Board of Directors may adopt, amend or repeal the Bylaws of this
corporation.
(C) Election of directors need not be by written ballot.
ARTICLE VI.
The officers of the corporation shall be chosen in such a manner, shall
hold their offices for such terms and shall carry out such duties as are
determined solely by the Board of Directors, subject to the right of the Board
of Directors to remove any officer or officers at any time with or without
cause.
ARTICLE VII.
No director of the corporation shall be personally liable to the
corporation or its stockholders for monetary damages for any breach of fiduciary
duty by such a director as a director. Notwithstanding the foregoing sentence, a
director shall be liable to the extent provided by applicable law (i) for any
breach of the director's duty of loyalty to the corporation or its stockholders,
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the
DGCL or (iv) for any transaction from which such director derived an improper
personal benefit. No amendment to or repeal of this Article VII shall apply to
or have any effect on the liability or alleged liability of any director of the
corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal. If the DGCL is amended hereafter to
further eliminate or limit the personal liability of directors, the liability of
a director of this corporation shall be limited or eliminated to the fullest
extent permitted by the DGCL, as amended.
ARTICLE VIII.
(A) TRANSFER AND OWNERSHIP RESTRICTIONS. In order to preserve the net
operating loss carryforwards (including any "net unrealized built-in loss," as
defined under applicable law), capital loss carryforwards, general business
credit carryforwards, alternative minimum tax credit carryforwards and other tax
benefits (collectively, the "Tax Benefits") to which the corporation or any
member of the corporation's "affiliated group" as that term is used in Section
1504 of the Internal Revenue Code of 1986, as amended from time to time, or any
successor statute (collectively, the "Code"), is or becomes entitled prior to
the Expiration Date (as hereinafter defined) pursuant to the Code and the
Treasury Regulations promulgated thereunder, as amended from time to time
("Treasury Regulations") or any applicable state statute, the following
restrictions shall apply until the earlier of (x) the day after the third (3rd)
anniversary of the effective time of the merger of The Presley Companies with
and into Presley Merger Sub, Inc. (the "Merger"), (y) the repeal of Section 382
of the Code if the Board of Directors determines that the restrictions in this
Article VIII are no longer necessary for the preservation of the Tax Benefits,
and (z) the beginning of a taxable year of the corporation to which the Board of
Directors determines that no Tax Benefits may be carried forward, unless the
Board of Directors shall fix an earlier or later date in accordance with Section
(E) of this Article VIII. (The date on which the restrictions of this Article
VIII expire hereunder is sometimes referred to herein as the "Expiration Date.")
(1) Definitions. For purposes of this Article VIII:
(a) "Option" shall have the meaning set forth in Treasury
Regulation Section 1.382-4;
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(b) a "Person" shall mean any individual, corporation, estate,
trust, association, company, partnership, joint venture, or similar organization
(including the corporation), or any other entity described in Treasury
Regulation Section 1.382-3(a)(1)(i);
(c) a "Prohibited Ownership Percentage" shall mean any Stock
ownership that would cause a Person or Public Group to be a "5-percent
shareholder" of the corporation within the meaning of Treasury Regulation
Section 1.382-2T(g)(1)(i) or (ii); for this purpose, whether a Person or Public
Group would be a "5-percent shareholder" shall be determined (i) without giving
effect to the following provisions: Treasury Regulation Sections 1.382-2T(g)(2),
1.382-2T(g)(3), 1.382-2T(h)(2)(iii) and 1.382-2T(h)(6)(iii), (ii) by treating
every Person or Public Group which owns Stock, whether directly or by
attribution, as directly owning such Stock notwithstanding any further
attribution of such Stock to other Persons and notwithstanding Treasury
Regulation Section 1.382-2T(h)(2)(i)(A), (iii) by substituting the term "Person"
in place of "individual" in Treasury Regulation Section 1.382-2T(g)(1), (iv) by
taking into account ownership of Stock at any time during the "testing period"
as defined in Treasury Regulation Section 1.382-2T(d)(1), and (v) by treating
each day during the testing period as if it were a "testing date" as defined in
Treasury Regulation Section 1.382-2T(a)(4)(i); in addition, for the purpose of
determining whether any Person or Public Group has a Prohibited Ownership
Percentage as of any date, the definition of Stock set forth in part (e) of this
subparagraph (A)(1) shall be applied in lieu of the definition in Treasury
Regulation Section 1.382-2T(f)(18), except that any Option shall be treated as
Stock only to the extent treating it as Stock would cause an increase in
ownership of Stock by such Person and such Option would be deemed exercised
pursuant to Treasury Regulations effect for time to time (disregarding whether
treating such Option as exercised would cause an ownership change);
(d) a "Public Group" shall have the meaning contained in Treasury
Regulation Section 1.382-2T(f)(13), excluding any "direct public group" with
respect to the corporation, as that term is used in Treasury Regulation Section
1.382-2T(j)(2)(ii);
(e) "Stock" refers to all classes of stock of the corporation, all
Options to acquire stock of the corporation and all other interests that would
be treated as stock in the corporation pursuant to Treasury Regulation Section
1.382-2T(f)(18)(iii), other than (i) stock described in Section 1504(a)(4) of
the Code and (ii) stock that would be described in such Section 1504(a)(4) but
is not so described solely because it is entitled to vote as a result of
dividend arrearages;
(f) "Transfer" shall mean any conveyance, by any means, of legal or
beneficial ownership (direct or indirect) of shares of Stock, whether such means
are direct or indirect, voluntary or involuntary, including, without limitation,
the transfer of any ownership interest in any entity that owns (directly or
indirectly) shares of Stock (and any reference in this Article VIII to a
Transfer of Stock shall include any Transfer of any interest in any such entity
and references to the Persons to whom Stock is Transferred shall include Persons
to whom any interest in any such entity shall have been Transferred); and
(g) "Transferee" means any Person to whom Stock is Transferred.
(2) Prohibited Transfers. From and after the effective time of the
Merger, no Person shall Transfer any Stock to any other Person to the extent
that such Transfer, if effected: (a) would cause the Transferee or any Person or
Public Group to have a Prohibited Ownership Percentage; (b) would increase the
Stock ownership percentage (determined in accordance with Section 382 of the
Code and the Treasury Regulations thereunder) of any Transferee or any Person or
Public Group having a Prohibited Ownership Percentage; or (c) would create,
under Treasury Regulation Section 1.382-2T(j)(3)(i), a new "public group" as
that term is used in Treasury Regulation Section 1.382-2T(f)(13).
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(3) Board of Directors Consent to Certain Transfers. The Board of
Directors may permit any Transfer of Stock that would otherwise be prohibited
pursuant to subparagraph (A)(2) of this Article VIII if information relating to
a specific proposed transaction is presented to the Board of Directors and the
Board of Directors determines that, based on the facts in existence at the time
of such determination, such transaction will not delay, prevent or otherwise
jeopardize the corporation's full utilization of the Tax Benefits. The Board of
Directors may impose any conditions that it deems reasonable and appropriate in
connection with such a Transfer, including without limitation, restrictions on
the ability of any Transferee to Transfer Stock acquired through such Transfer;
provided, however, that any such restrictions shall be consented to by such
Transferee and the certificates representing such Stock shall include an
appropriate legend.
(4) Waiver of Restrictions. Notwithstanding anything herein to the
contrary, the Board of Directors may waive any of the restrictions contained in
subparagraph (A)(2) of this Article VIII in any instance in which the Board of
Directors determines that a waiver would be in the best interests of the
corporation, notwithstanding the effect of such waiver on the Tax Benefits.
(B) PURPORTED TRANSFER IN VIOLATION OF TRANSFER RESTRICTION. Unless the
approval or waiver of the Board of Directors is obtained as provided in
subparagraphs (A)(3) or (A)(4) of this Article VIII, any purported Transfer of
Stock in excess of the shares that could be Transferred to the Transferee
without restriction under subparagraph (A)(2) of this Article VIII shall be null
and void and shall not be effective to Transfer record, legal, beneficial or any
other ownership of such excess shares (the "Prohibited Shares") to the purported
acquiror of any form of such ownership (the "Purported Acquiror"), who shall not
be entitled to any rights as a stockholder of the corporation with respect to
the Prohibited Shares (including, without limitation, the right to vote or to
receive dividends with respect thereto). Any purported record, beneficial, legal
or other owner of Prohibited Shares shall be deemed to be a "Purported Acquiror"
of such Prohibited Shares. If there is more than one Purported Acquiror with
respect to certain Prohibited Shares (for example, if the Purported Acquiror of
record ownership of such Prohibited Shares is not the Purported Acquiror of
beneficial ownership of such Prohibited Shares), then references to "Purported
Acquiror" shall include any or all of such Purported Acquirors, as appropriate.
Subparagraphs (B)(1) and (B)(2) below shall apply only in the case of violations
of the restrictions contained in parts (a) and (b) of subparagraph (A)(2) of
this Article VIII.
(1) Transfer of Prohibited Shares and Prohibited Distributions to
Agent. Upon demand by the corporation, the Purported Acquiror shall transfer or
cause the transfer of any certificate or other evidence of purported ownership
of the Prohibited Shares within the Purported Acquiror's possession or control,
along with any dividends or other distributions paid by the corporation with
respect to the Prohibited Shares that were received by the Purported Acquiror
(the "Prohibited Distributions"), to an agent designated by the corporation (the
"Agent"). The Agent shall sell in an arms-length transaction (through the New
York Stock Exchange, if possible, but in any event consistent with applicable
law) any Prohibited Shares transferred to the Agent by the Purported Acquiror.
The proceeds of such sale shall be referred to as "Sales Proceeds." If the
Purported Acquiror has sold the Prohibited Shares to an unrelated party in an
arms-length transaction after purportedly acquiring them, the Purported Acquiror
shall be deemed to have sold the Prohibited Shares for the Agent, and in lieu of
transferring the Prohibited Shares and Prohibited Distributions to the Agent
shall transfer to the Agent the Prohibited Distributions and the proceeds of
such sale (the "Resale Proceeds"), except to the extent that the Agent grants
written permission to the Purported Acquiror to retain a portion of the Resale
Proceeds not exceeding the amount that would have been payable by the Agent to
the Purported Acquiror pursuant to subparagraph (B)(2) below if the Prohibited
Shares had been sold by the Agent rather than by the Purported Acquiror. Any
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purported Transfer of the Prohibited Shares by the Purported Acquiror other than
a transfer which (a) is described in the preceding sentences of this
subparagraph (B)(1) and (b) does not itself violate the provisions of this
Article VIII shall be null and void and shall not be effective to transfer any
ownership of the Prohibited Shares.
(2) Allocation of Sale Proceeds, Resale Proceeds and Prohibited
Distributions. The Sale Proceeds or the Resale Proceeds, if applicable, shall be
allocated to the Purported Acquiror up to the following amount: (a) where
applicable, the purported purchase price paid or value of consideration
surrendered by the Purported Acquiror for the Prohibited Shares, or (b) where
the purported Transfer of the Prohibited Shares to the Purported Acquiror was by
gift, inheritance, or any similar purported Transfer, the fair market value of
the Prohibited Shares at the time of such purported Transfer. Any Resale
Proceeds or Sales Proceeds in excess of the Agent's expenses incurred in
performing its duties hereunder and the amount allocable to the Purported
Acquiror pursuant to the preceding sentence, together with any Prohibited
Distributions (such excess amount and Prohibited Distributions are collectively
the "Subject Amounts"), shall be paid over to an entity designated by the
corporation that is described in Section 501(c)(3) of the Code. In no event
shall any such Prohibited Shares or Subject Amounts inure to the benefit of the
corporation or the Agent, but such amounts may be used to cover expenses
incurred by the Agent in performing its duties hereunder.
(3) Prompt Enforcement Against Purported Acquiror. Within thirty (30)
business days of learning of the purported Transfer of Prohibited Shares to a
Purported Acquiror or a Transfer of Stock which would cause a Person or Public
Group to become a Prohibited Party (as hereinafter defined), the corporation
through its Secretary shall demand that the Purported Acquiror or the Prohibited
Party Group (as hereinafter defined) surrender to the Agent the certificates
representing the Prohibited Shares, or any Resale Proceeds, and any Prohibited
Distributions, and if such surrender is not made by the Purported Acquiror or
Prohibited Party Group within thirty (30) business days from the date of such
demand, the corporation shall institute legal proceedings to compel such
transfer; provided, however, that nothing in this subparagraph (B)(3) shall
preclude the corporation in its discretion from immediately bringing legal
proceedings without a prior demand, and provided further that failure of the
corporation to act within the time periods set out in this subparagraph (B)(3)
shall not constitute a waiver of any right of the corporation to compel any
transfer required by, or take any action permitted by, this Article VIII. Upon a
determination by the Board of Directors that there has been or is threatened a
purported Transfer of Prohibited Shares to a Purported Acquiror or a Transfer of
Stock which would cause a Person or Public Group to become a Prohibited Party or
any other violation of Section (A)of this Article VIII, the Board of Directors
may authorize such additional action as it deems advisable to give effect to the
provisions of this Article VIII, including, without limitation, refusing to give
effect on the books of the corporation to any such purported Transfer or
instituting proceedings to enjoin any such purported Transfer.
(4) Other Remedies. In the event that the Board of Directors determines
that a Person proposes to take any action in violation of subparagraph (A)(2) of
this Article VIII, or in the event that the Board of Directors determines after
the fact that an action has been taken in violation of subparagraph (A)(2) of
this Article VIII, the Board of Directors, subject to subparagraph (B)(5) of
this Article VIII, may take such action as it deems advisable to prevent or to
refuse to give effect to any purported Transfer or other action which would
result, or has resulted, in such violation, including, but not limited to,
refusing to give effect to such purported Transfer or other action on the books
of the corporation or instituting proceedings to enjoin such purported Transfer
or other action. If any Person shall knowingly violate, or knowingly cause any
other Person under the control of such Person ("Controlled Person") to violate,
subparagraph (A)(2) of this Article VIII, then that Person and any Controlled
Person shall be jointly and severally liable for, and shall pay to the
corporation, such amount as well, after taking account of all taxes imposed with
respect to the receipt or accrual of such amount
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and all costs incurred by the corporation as a result of such violation, put the
corporation in the same financial position as it would have been in had such
violation not occurred.
(5) No Restriction on Settlement of Exchange Transactions. Nothing
contained in this Article VIII shall preclude the settlement of any transaction
involving Stock entered into through the facilities of the New York Stock
Exchange, or any other national securities exchange. The application of the
provisions and remedies described in this Section (B) of this Article VIII shall
be deemed not to so preclude any such settlement.
(6) Modification of Remedies For Certain Indirect Transfers. In the
event of any Transfer of Stock or other event which does not involve a transfer
of "securities" of the corporation within the meaning of the DGCL, as amended
("Securities"), but which would cause a Person or Public Group (the "Prohibited
Party") to violate a restriction provided for in part (a) or (b) of subparagraph
(A)(2) of this Article VIII, the application of subparagraphs (B)(1) and (B)(2)
shall be modified as described in this subparagraph (B)(6). In such case, the
Prohibited Party and/or any Person or Public Group whose ownership of the
corporation's Securities is attributed to the Prohibited Party pursuant to
Section 382 of the Code and the Treasury Regulations thereunder (collectively,
the "Prohibited Party Group") shall not be required to dispose of any interest
which is not a Security, but shall be deemed to have disposed of, and shall be
required to dispose of, sufficient Securities (which Securities shall be
disposed of in the inverse order in which they were acquired by members of the
Prohibited Party Group), to cause the Prohibited Party, following such
disposition, not to be in violation of part (a) or (b) of subparagraph (A)(2) of
this Article VIII. Such disposition shall be deemed to occur simultaneously with
the Transfer giving rise to the application of this provision, and such number
of Securities which are deemed to be disposed of shall be considered Prohibited
Shares and shall be disposed of through the Agent as provided in subparagraphs
(B)(1) and (B)(2) of this Article VIII, except that the maximum aggregate amount
payable to the Prohibited Party Group in connection with such sale shall be the
fair market value of the Prohibited Shares at the time of the Prohibited
Transfer.
(C) OBLIGATION TO PROVIDE INFORMATION. The corporation may require as a
condition to the registration of the Transfer of any Stock that the proposed
Transferee furnish to the corporation all information reasonably requested by
the corporation with respect to all the direct or indirect beneficial or legal
ownership of Stock or Options to acquire Stock by the proposed Transferee and by
Persons controlling, or controlled by or under common control with the proposed
Transferee.
(D) LEGENDS. All certificates issued by the corporation evidencing
ownership of shares of Stock of this corporation that are subject to the
restrictions on transfer and ownership contained in this Article VIII shall bear
a conspicuous legend referencing the restrictions set forth in this Article
VIII.
(E) FURTHER ACTIONS. Subject to subparagraph (B)(5) of this Article VIII,
nothing contained in this Article VIII shall limit the authority of the Board of
Directors to take such other action to the extent permitted by law as it deems
necessary or advisable to protect the corporation in preserving the Tax
Benefits. Without limiting the generality of the foregoing, in the event of a
change in law (including applicable regulations) making one or more of the
following actions necessary or desirable or in the event that the Board of
Directors believes one or more of such actions is in the best interest of the
corporation, the Board of Directors may (1) accelerate or extend the Expiration
Date, (2) modify the definitions of any terms set forth in this Article VIII or
(3) conform any provisions of Section (A) of this Article VIII to the extent
necessary to make such provisions consistent with the Code and Treasury
Regulations following any changes therein; provided that the Board of Directors
shall determine in writing that such acceleration, extension, change or
modification is reasonably necessary or desirable to
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preserve the Tax Benefits or that the continuation of these restrictions is no
longer reasonably necessary for the preservation of the Tax Benefits, as the
case may be, which determination may be based upon an opinion of legal counsel
to the corporation and which determination shall be filed with the Secretary of
the corporation and mailed by the Secretary to the stockholders of this
corporation within ten (10) days after the date of any such determination. In
addition, the Board of Directors may, to the extent permitted by law, from time
to time establish, modify, amend or rescind Bylaws, regulations and procedures
of the corporation not inconsistent with the express provisions of this Article
VIII for purposes of determining whether any acquisition of Stock would
jeopardize the corporation's ability to preserve and use the Tax Benefits, and
for the orderly application, administration and implementation of the provisions
of this Article VIII. Such procedures and regulations shall be kept on file with
the Secretary of the corporation and with its transfer agent and shall be made
available for inspection by the public and, upon request, shall be mailed to any
holder of Stock. The Board of Directors of the corporation shall have the
exclusive power and authority to administer this Article VIII and to exercise
all rights and powers specifically granted to the Board of Directors or the
corporation, or as may be necessary or advisable in the administration of this
Article VIII, including without limitation, the right and power to (1) interpret
the provisions of this Article VIII, and (2) make all calculations and
determinations deemed necessary or advisable for the administration of this
Article VIII. All such actions, calculations, interpretations and determinations
which are done or made by the Board of Directors in good faith shall be final,
conclusive and binding on the corporation, the Agent, and all other parties;
provided, however, the Board of Directors may delegate all or any portion of its
duties and powers under this Article VIII to a committee of the Board of
Directors as it deems necessary or advisable.
(F) BENEFITS OF THIS ARTICLE VIII. Nothing in this Article VIII shall be
construed to give to any Person other than the corporation or the Agent any
legal or equitable right, remedy or claim under this Article VIII. This Article
VIII shall be for the sole and exclusive benefit of the corporation and the
Agent.
(G) SEVERABILITY. If any provision of this Article VIII or the application
of any such provision to any Person or under any circumstance shall be held
invalid, illegal, or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision of this Article VIII.
ARTICLE IX.
(A) RIGHT TO INDEMNIFICATION. Each person who was or is made a party to or
is threatened to be made a party to or is involuntarily involved in any action,
suit or proceeding, whether civil, criminal, administrative or investigative (a
"Proceeding"), by reason of the fact that he or she is or was a director or
officer of the corporation, or is or was serving (during his or her tenure as a
director and/or an officer) at the request of the corporation as a director,
officer, employee or agent of another corporation or of a partnership, joint
venture, trust or other enterprise, whether the basis of such Proceeding is an
alleged action or inaction in an official capacity as a director or officer or
in any other capacity while serving as a director or officer, shall be
indemnified and held harmless by the corporation to the fullest extent
authorized by the DGCL (or other applicable law), as the same exists or may
hereafter be amended, against all expense, liability and loss (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid or to be paid in settlement) reasonably incurred or suffered by such person
in connection with such Proceeding. Such director or officer shall have the
right to be paid by the corporation for expenses incurred in defending any such
Proceeding in advance of its final disposition; provided, however, that, if the
DGCL (or other applicable law) requires, the payment of such expenses in advance
of the final disposition of
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any such Proceeding shall be made only upon receipt by the corporation of an
undertaking by or on behalf of such director or officer to repay all amounts so
advanced if it should be determined ultimately that he or she is not entitled to
be indemnified under this Article IX or otherwise.
(B) RIGHT OF CLAIMANT TO BRING SUIT. If a claim under paragraph A of this
Article IX is not paid in full by the corporation within sixty (60) days after a
written claim has been received by the corporation, the claimant may at any time
thereafter bring suit against the corporation to recover the unpaid amount of
the claim, together with interest thereon, and, if successful in whole or in
part, the claimant shall also be entitled to be paid the expense of prosecuting
such claim, including reasonable attorneys' fees incurred in connection
therewith. It shall be a defense to any such action (other than an action
brought to enforce a claim for expenses incurred in defending any Proceeding in
advance of its final disposition where the required undertaking, if any is
required, has been tendered to the corporation) that the claimant has not met
the standards of conduct which make it permissible under the DGCL (or other
applicable law) for the corporation to indemnify the claimant for the amount
claimed, but the burden of proving such defense shall be on the corporation.
Neither the failure of the corporation (or of its full Board of Directors, its
directors who are not parties to the Proceeding with respect to which
indemnification is claimed, its stockholders, or independent legal counsel) to
have made a determination prior to the commencement of such action that
indemnification of the claimant is proper in the circumstances because he or she
has met the applicable standard of conduct set forth in the DGCL (or other
applicable law), nor an actual determination by any such person or persons that
such claimant has not met such applicable standard of conduct, shall be a
defense to such action or create a presumption that the claimant has not met the
applicable standard of conduct.
(C) NON-EXCLUSIVITY OF RIGHTS. The rights conferred by this Article IX
shall not be exclusive of any other right which any director, officer,
representative, employee or other agent may have or hereafter acquire under the
DGCL or any other statute, or any provision contained in the corporation's
Certificate of Incorporation or Bylaws, or any agreement, or pursuant to a vote
of stockholders or disinterested directors, or otherwise.
(D) INSURANCE AND TRUST FUND. In furtherance and not in limitation of the
powers conferred by statute:
(1) the corporation may purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee or agent of the corporation,
or is serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability under
the provisions of law; and
(2) the corporation may create a trust fund, grant a security interest
and/or use other means (including, without limitation, letters of credit, surety
bonds and/or other similar arrangements), as well as enter into contracts
providing indemnification to the fullest extent permitted by law and including
as part thereof provisions with respect to any or all of the foregoing, to
ensure the payment of such amount as may become necessary to effect
indemnification as provided therein, or elsewhere.
(E) INDEMNIFICATION OF EMPLOYEES AND AGENTS OF THE CORPORATION. The
corporation may, to the extent authorized from time to time by the Board of
Directors, grant rights to indemnification, including the right to be paid by
the corporation the expenses incurred in defending any Proceeding in advance of
its final disposition, to any employee or agent of the corporation to the
fullest extent of the provisions of this Article IX or
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otherwise with respect to the indemnification and advancement of expenses of
directors and officers of the corporation.
(F) SURVIVAL OF RIGHTS. The rights set forth in this Article IX are
contract rights and survive any change to this Article IX. Any repeal or
modification of this Article IX shall not change the rights of an officer or
director to indemnification with respect to any action or omission occurring
prior to such repeal or modification.
ARTICLE X.
The corporation reserves the right to repeal, alter, amend, or rescind any
provisions contained in this Certificate of Incorporation, in the manner now or
hereafter prescribed by the laws of the State of Delaware, and all rights
conferred on stockholders herein are granted subject to this reservation.
ARTICLE XI.
The incorporator is Stevie Pyon, whose mailing address is Irell & Manella
LLP, 333 South Hope Street, Suite 3300, Los Angeles, California 90071.
I, THE UNDERSIGNED, being the incorporator, for the purpose of forming a
corporation under the laws of the State of Delaware do make, file and record
this Certificate of Incorporation, and, accordingly, have hereto set my hand
this 15th day of July, 1999.
/s/ STEVIE PYON
--------------------------------------
Stevie Pyon, Incorporator
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