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F O R M 10 - Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
For the Quarterly Period Ended March 31, 1996
( ) Transition Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
For the Transition Period From ___________ to _____________
Commission file number 1-5057
BOISE CASCADE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 82-0100960
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1111 West Jefferson
P.O. Box 50
Boise, Idaho 83728-0001
(Address of principal executive offices) (Zip Code)
(208) 384-6161
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No ___
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Shares Outstanding
Class as of April 30, 1996
Common stock, $2.50 par value 48,275,260
PART I - FINANCIAL INFORMATION
STATEMENTS OF INCOME
BOISE CASCADE CORPORATION AND SUBSIDIARIES
(unaudited)
Item 1. Financial Statements
Three Months Ended March 31
1996 1995
(expressed in thousands
except per share data)
Revenues
Sales $1,227,600 $1,222,960
Other income, net 6,260 1,870
__________ __________
1,233,860 1,224,830
__________ __________
Costs and expenses
Materials, labor, and other operating expenses 967,620 942,520
Depreciation and cost of company timber
harvested 55,340 60,390
Selling and administrative expenses 135,810 97,820
__________ __________
1,158,770 1,100,730
__________ __________
Equity in net income of affiliates 1,090 5,570
__________ __________
Income from operations 76,180 129,670
__________ __________
Interest expense (30,560) (37,230)
Interest income 340 310
Foreign exchange loss (250) -
Gain on subsidiary's issuance of stock 430 -
__________ __________
(30,040) (36,920)
__________ __________
Income before income taxes and
minority interest 46,140 92,750
Income tax provision 17,830 35,710
__________ __________
Income before minority interest 28,310 57,040
Minority interest, net of income tax (2,800) -
__________ __________
Net income $ 25,510 $ 57,040
Net income per common share
Primary $ .32 $ .93
Fully diluted $ .30 $ .85
Dividends declared per common share $ .15 $ .15
The accompanying notes are an integral part of these Financial Statements.
SEGMENT INFORMATION
BOISE CASCADE CORPORATION AND SUBSIDIARIES
(unaudited)
Three Months Ended March 31
1996 1995
(expressed in thousands)
Segment sales
Paper and paper products $ 495,925 $ 593,920
Office products 461,423 303,287
Building products 347,957 393,438
Intersegment eliminations and other (77,705) (67,685)
__________ __________
$1,227,600 $1,222,960
Segment operating income
Paper and paper products $ 53,427 $ 97,998
Office products 27,615 12,563
Building products 888 23,484
Equity in net income of affiliates 1,090 5,570
Corporate and other (6,840) (9,945)
__________ __________
Income from operations $ 76,180 $ 129,670
The accompanying notes are an integral part of these Financial Statements.
BOISE CASCADE CORPORATION AND SUBSIDIARIES
BALANCE SHEETS
(unaudited)
ASSETS
March 31 December 31
1996 1995 1995
(expressed in thousands)
Current
Cash and cash items $ 39,721 $ 29,601 $ 36,876
Short-term investments at cost,
which approximates market 8,944 5,972 14,593
__________ __________ __________
48,665 35,573 51,469
Receivables, less allowances of
$3,734,000, $2,048,000 and
$3,577,000 484,017 444,481 457,608
Inventories 617,208 396,922 568,905
Deferred income tax benefits 78,858 63,231 82,744
Other 130,936 17,824 152,442
__________ __________ __________
1,359,684 958,031 1,313,168
__________ __________ __________
Property
Property and equipment
Land and land improvements 40,191 38,282 39,482
Buildings and improvements 464,661 442,168 459,897
Machinery and equipment 4,433,607 4,111,682 4,271,306
__________ __________ __________
4,938,459 4,592,132 4,770,685
Accumulated depreciation (2,198,192) (2,103,772) (2,166,487)
__________ __________ __________
2,740,267 2,488,360 2,604,198
Timber, timberlands, and timber
deposits 377,165 399,636 383,394
__________ __________ __________
3,117,432 2,887,996 2,987,592
__________ __________ __________
Investments in equity affiliates 31,706 211,796 25,803
Other assets 425,061 285,277 329,623
__________ __________ __________
Total assets $4,933,883 $4,343,100 $4,656,186
The accompanying notes are an integral part of these Financial Statements.
BOISE CASCADE CORPORATION AND SUBSIDIARIES
BALANCE SHEETS
(unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
March 31 December 31
1996 1995 1995
(expressed in thousands)
Current
Notes payable $ 93,000 $ 66,000 $ 17,000
Current portion of long-term debt 18,653 37,188 20,778
Income taxes payable 707 1,357 26,328
Accounts payable 410,910 312,159 379,523
Accrued liabilities
Compensation and benefits 138,923 108,663 159,514
Interest payable 25,496 29,986 27,542
Other 153,316 104,268 139,222
__________ __________ __________
841,005 659,621 769,907
__________ __________ __________
Debt
Long-term debt, less current portion 1,552,726 1,578,914 1,364,835
Guarantee of ESOP debt 213,934 230,956 213,934
__________ __________ __________
1,766,660 1,809,870 1,578,769
__________ __________ __________
Other
Deferred income taxes 298,727 188,948 302,030
Other long-term liabilities 255,290 279,778 243,259
__________ __________ __________
554,017 468,726 545,289
__________ __________ __________
Minority interest 70,386 - 67,783
__________ __________ __________
Shareholders' equity
Preferred stock -- no par value;
10,000,000 shares authorized;
Series D ESOP: $.01 stated
value; 6,062,101; 6,208,880
and 6,117,774 shares outstanding 272,795 279,400 275,300
Deferred ESOP benefit (213,934) (230,956) (213,934)
Series F: $.01 stated value;
115,000 shares outstanding
in each period 111,043 111,043 111,043
Series G: $.01 stated value;
862,500 shares outstanding
in each period 176,404 176,404 176,404
Common stock -- $2.50 par value;
200,000,000 shares authorized;
48,020,444; 47,037,155 and
47,759,946 shares outstanding 120,051 117,593 119,400
Additional paid-in capital 216,392 172,782 205,107
Retained earnings 1,019,064 778,617 1,021,118
__________ __________ __________
Total shareholders' equity 1,701,815 1,404,883 1,694,438
__________ __________ __________
Total liabilities and shareholders'
equity $4,933,883 $4,343,100 $4,656,186
The accompanying notes are an integral part of these Financial Statements.
BOISE CASCADE CORPORATION AND SUBSIDIARIES
STATEMENTS OF CASH FLOWS
(unaudited)
Three Months Ended March 31
1996 1995
(expressed in thousands)
Cash provided by (used for) operations
Net income $ 25,510 $ 57,040
Items in income not using (providing) cash
Equity in net income of affiliates (1,090) (5,570)
Depreciation and cost of company timber
harvested 55,340 60,390
Deferred income tax provision 9,059 33,627
Minority interest, net of income tax 2,800 -
Amortization and other 5,084 3,218
Gain on subsidiary's issuance of stock (430) -
Receivables 13,533 (36,997)
Inventories (24,923) 27,053
Accounts payable and accrued liabilities (26,072) 1,827
Current and deferred income taxes (28,865) 2,411
Other 3,551 2,106
__________ __________
Cash provided by operations 33,497 145,105
__________ __________
Cash provided by (used for) investment
Expenditures for property and equipment (170,616) (53,968)
Expenditures for timber and timberlands (1,795) (2,166)
Investments in equity affiliates, net (4,659) -
Purchase of facilities (129,259) (3,289)
Other 18,394 (6,638)
__________ __________
Cash used for investment (287,935) (66,061)
__________ __________
Cash provided by (used for) financing
Cash dividends paid
Common stock (7,164) (5,743)
Preferred stock (6,126) (9,969)
__________ __________
(13,290) (15,712)
Notes payable 76,000 10,000
Additions to long-term debt 338,893 -
Payments of long-term debt (153,127) (67,580)
Other 3,158 367
__________ __________
Cash provided by (used for) financing 251,634 (72,925)
__________ __________
Increase (decrease) in cash and short-term
investments (2,804) 6,119
Balance at beginning of the year 51,469 29,454
__________ __________
Balance at March 31 $ 48,665 $ 35,573
The accompanying notes are an integral part of these Financial Statements.
Notes to Quarterly Financial Statements
(1) BASIS OF PRESENTATION. The quarterly financial statements have been
prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. These
statements should be read together with the statements and the accom-
panying notes included in the Company's 1995 Annual Report.
The quarterly financial statements have not been audited by independent
public accountants, but in the opinion of management, all adjustments
necessary to present fairly the results for the periods have been
included. The net income for the three months ended March 31, 1996 and
1995, was subject to seasonal variations and necessarily involved
estimates and accruals. Except as may be disclosed within these "Notes
to Quarterly Financial Statements," the adjustments made were of a
normal, recurring nature. Quarterly results are not necessarily
indicative of results that may be expected for the year.
(2) NET INCOME PER COMMON SHARE. Net income per common share was determined
by dividing net income, as adjusted, by applicable shares outstanding.
For the three months ended March 31, 1996 and 1995, primary average
shares included common shares outstanding and, if dilutive, common stock
equivalents attributable to stock options, Series E conversion preferred
stock prior to converting to shares of the Company's common stock on
January 15, 1995, and Series G conversion preferred stock. For the
three months ended March 31, 1996, the effect of the Series G conversion
preferred stock was antidilutive. Accordingly, 6,909,000 common
equivalent shares are excluded for that period. In addition to common
and common equivalent shares, fully diluted average shares include
common shares that would be issuable upon conversion of the Company's
other convertible securities.
Three Months Ended March 31
1996 1995
(expressed in thousands)
Net income as reported $ 25,510 $ 57,040
Preferred dividends (9,849) (6,418)
_________ _________
Primary income 15,661 50,622
Assumed conversions:
Preferred dividends eliminated 3,739 3,715
Interest on 7% debentures eliminated - 849
Supplemental ESOP contribution (3,195) (3,175)
_________ _________
Fully diluted income $ 16,205 $ 52,011
Average number of common shares
Primary 48,400 54,356
Fully diluted 53,403 61,257
Primary income excludes the dividends on the Company's preferred stock,
if dilutive. The dividend attributable to the Company's Series D
convertible preferred stock held by the Company's ESOP (employee stock
ownership plan) is net of a tax benefit. To determine the fully diluted
income, dividends on convertible preferred stock and interest, net of
any applicable taxes, have been added back to primary income to reflect
assumed conversions, if dilutive. The fully diluted income was reduced
by the after-tax amount of additional contributions that the Company
would be required to make to its ESOP if the Series D ESOP preferred
shares were converted to common stock.
(3) INVENTORIES. Inventories include the following:
March 31 December 31
1996 1995 1995
(expressed in thousands)
Finished goods and work in process $456,299 $266,560 $394,163
Logs 95,535 52,137 116,959
Other raw materials and supplies 176,927 168,772 175,877
LIFO reserve (111,553) (90,547) (118,094)
________ ________ ________
$617,208 $396,922 $568,905
(4) INCOME TAXES. The estimated tax provision rate, excluding the effect of
not providing taxes related to "Gain on subsidiary's issuance of stock,"
for the first three months of 1996 was 39%, compared with a tax
provision rate of 38.5% for the same period in the prior year.
(5) DEBT. At March 31, 1996, the Company had a $600 million revolving
credit agreement with a group of banks. Borrowing under the agreement
was $35 million. In the first quarter of 1996, the Company guaranteed
amounts outstanding under a loan agreement between a group of banks and
a wholly owned subsidiary. At March 31, 1996, amounts outstanding under
this agreement were $104 million. Additionally, the Company's majority-
owned subsidiary, Boise Cascade Office Products Corporation ("BCOP"),
had a $225 million revolving credit agreement with a group of banks.
Borrowing under this agreement was $110 million.
On January 24, 1996, the Company sold $125 million of 7.35% debentures
due 2016.
(6) BOISE CASCADE OFFICE PRODUCTS CORPORATION. During the first quarter of
1996, BCOP, the Company's majority-owned subsidiary, made five
acquisitions which were accounted for under the purchase method of
accounting. Accordingly, the purchase prices were allocated to the
assets acquired and liabilities assumed based upon their estimated fair
values. The excess of the purchase price over the estimated fair value
of the net assets acquired was recorded as goodwill and is being
amortized over 40 years. The results of operations of the acquired
businesses are included in BCOP's operations subsequent to the dates of
acquisition.
On January 31, 1996, BCOP acquired the contract stationer business of
Sierra Vista Office Products, Inc., based in Albuquerque, New Mexico.
On February 5, 1996, BCOP acquired Grand & Toy Limited, a Canadian
office products distributor. On February 9, 1996, BCOP acquired the
contract stationer businesses of Loring, Short & Harmon, Inc., based in
Portland, Maine, and McAuliffe's based in Burlington, Vermont. On
March 29, 1996, BCOP acquired the contract stationer and office
furniture business of Office Essentials based in Milwaukee, Wisconsin.
These businesses were acquired for a total of $129.3 million in cash and
$7.9 million payable to the sellers. The combined annual sales at the
time of announcement of these acquisitions were approximately
$301 million.
Unaudited pro forma results of operations, reflecting these
acquisitions, would have been as follows. If these businesses had been
acquired on January 1, 1996, the Company's first quarter 1996 sales
would have increased by $29.2 million, net income would have decreased
by $151,000, and there would have been no change to primary and fully
diluted earnings per common share. If these businesses had been
acquired on January 1, 1995, the Company's first quarter 1995 sales
would have increased by $66.3 million, net income would have decreased
by $2.4 million, and primary and fully diluted earnings per common share
would have decreased by $.04. In the first quarter of 1995, Grand &
Toy Limited recorded a restructuring charge. Excluding the impact of
this restructuring charge, pro forma net income and earnings per share
would have been essentially unchanged. This unaudited pro forma
financial information does not necessarily represent the actual
consolidated results of operations that would have resulted if the
acquisitions had occurred on the dates assumed.
In April 1996, BCOP announced it had signed letters of intent to acquire
Crawford's Office Supplies, Inc., based in Seattle, Washington; Zemlick
Brothers, Inc., based in Kalamazoo, Michigan; Bangs Office Products,
Inc., based in Pocatello, Idaho; and Pedersen Contact based in
Melbourne, Australia. The combined annual sales of the acquisitions at
the time of announcement were $63.3 million. BCOP also announced the
start-up of new office products distribution centers in Las Vegas,
Nevada, and Miami, Florida.
Also in April, BCOP's board of directors authorized a two-for-one split
of BCOP common stock in the form of a 100% stock dividend. Each BCOP
shareholder of record at the close of business on May 6, 1996, will
receive one additional share for each share held on that date. The new
shares will be distributed on May 20, 1996.
(7) SHAREHOLDER'S EQUITY. On January 15, 1995, the Company's Series E
preferred stock converted to 8,625,000 shares of common stock.
In October 1995, the Company announced that its board of directors had
authorized the Company to purchase up to 4,300,000 shares of its common
stock or common stock equivalents. In April 1996, the Company announced
that because of recent weakness in paper and wood products markets, it
had slowed the purchase of its common stock or common stock equivalents.
The repurchase program was to be in effect for 12 to 18 months, but that
period may be extended. The Company purchased about 620,000 shares of
stock through March 31, 1996.
(8) INVESTMENTS IN EQUITY AFFILIATES. In October 1994, Rainy River Forest
Products Inc. ("Rainy River"), the Company's former Canadian subsidiary,
completed an initial public offering of units of its equity and debt
securities. As a result of the offering, the Company owned 49% of the
outstanding voting common shares and 60% of the total equity of Rainy
River. During 1995, Rainy River was accounted for on the equity method
in the Company's consolidated financial statements. For the three
months ended March 31, 1995, Rainy River's results of operations were
included in "Equity in net income of affiliates." In November 1995, the
Company divested its remaining interest in Rainy River through Rainy
River's merger with Stone-Consolidated Corporation. At March 31, 1996,
the Company held approximately 6,600,000 shares of Stone-Consolidated
common stock, representing less than 10% of Stone-Consolidated's
outstanding common stock. In addition, the Company held approximately
1,832,000 shares of Stone-Consolidated's redeemable preferred stock.
The Company accounts for its holdings in Stone-Consolidated on the cost
method. The investment in Stone-Consolidated stock totaled $105 million
at March 31, 1996. The investment has been classified as available for
sale and is being marked to market. At March 31, 1996, "Retained
Earnings" was reduced by $13.5 milion, including the impact of foreign
currency translation and deferred income taxes, for this market
adjustment.
On October 16, 1995, the Company announced its intent to form a joint
venture with Companhia Suzano de Papel e Celulose ("Suzano"), a
Brazilian pulp and paper producer, to acquire, operate, and expand the
Company's pulp and paper mill, timberlands, sawmill, and wastepaper
recycling plant in Jackson, Alabama. In April 1996, the Company
announced that it had discontinued talks with Suzano regarding formation
of the joint venture. Regardless, the Company will complete the
expansion of the mill, including construction of a new uncoated free
sheet paper machine, which represents a $290 million capital investment.
The Company will consider other financing alternatives, but there is no
assurance that any such alternative will be acceptable to the Company.
The new paper machine should begin production in the second quarter of
1997.
(9) OTHER. In April 1996, the Company completed the previously announced
reconfiguration of its Vancouver, Washington, paper mill by permanently
shutting down the mill's three paper machines and recycled wastepaper
operation. The mill will operate as a paper converting facility,
converting papers made elsewhere by the Company primarily into security
papers. In the fourth quarter of 1995, the Company recorded a pretax
charge of $74.9 million, most of which was related to the
reconfiguration of this mill.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
First Quarter of 1996, Compared With First Quarter of 1995
Boise Cascade Corporation's net income for the first quarter of 1996 was
$25.5 million, compared with net income of $57.0 million for the first quarter
of 1995. Primary earnings per common share for the first quarter of 1996 were
$.32 and fully diluted earnings per common share were $.30. For the same
quarter in 1995, primary earnings per common share were $.93, while fully
diluted earnings per common share were $.85. Sales for the first quarter of
1996 and 1995 were $1.2 billion.
In October 1994, Rainy River Forest Products Inc. ("Rainy River"), the
Company's former Canadian subsidiary, completed an initial public offering of
units of its equity and debt securities. As a result of the offering, the
Company owned 49% of the outstanding voting common shares and 60% of the total
equity of Rainy River. During 1995, Rainy River was accounted for on the
equity method in the Company's consolidated financial statements. For the
three months ended March 31, 1995, Rainy River's results of operations were
included in "Equity in net income of affiliates." In November 1995, the
Company divested its remaining interest in Rainy River through Rainy River's
merger with Stone-Consolidated Corporation. At March 31, 1996, the Company
held approximately 6,600,000 shares of Stone-Consolidated common stock,
representing less than 10% of Stone-Consolidated's outstanding common stock.
In addition, the Company held approximately 1,832,000 shares of
Stone-Consolidated's redeemable preferred stock. The Company accounts for its
holdings in Stone-Consolidated on the cost method. The investment in
Stone-Consolidated stock totaled $105 million at March 31, 1996. The
investment has been classified as available for sale and is being marked to
market. At March 31, 1996, "Retained Earnings" was been reduced by
$13.5 million, including the impact of foreign currency translation and
deferred income taxes, for this market adjustment.
In the Company's paper segment, operating income fell to $53.4 million in the
first quarter of 1996, compared with $98.0 million in the first quarter of
1995. Sales fell 16% to $495.9 million in the first quarter of 1996 from
$593.9 million in the first quarter of 1995. The decline in results was due
primarily to a sharp decrease in orders for paper, which resulted in lower
paper prices and reduced output. Orders for paper fell, as economic growth in
Europe and the U.S. slowed and as customers worked off higher-than-normal
inventories that they had accumulated last year as a hedge against rapidly
rising paper prices. Results were impacted to a lesser extent by
flood-related problems in the Pacific Northwest. Although average prices for
most of the Company's paper grades were higher in the first quarter of 1996
than in the first quarter of 1995, the average prices declined from fourth-
quarter 1995 levels. Uncoated free sheet papers fell $143 a ton, or 14%;
coated papers fell $75 a ton, or 7%; containerboard fell $74 a ton, or 16%;
newsprint fell $2 a ton, or .3%; and market pulp fell $259 a ton, or 38%.
Sales volumes for the first quarter of 1996 were 602,000 tons, compared with
739,000 tons in the first quarter of 1995 and 630,000 tons in the fourth
quarter of 1995. During the first quarter of this year, the Company's paper
operations curtailed approximately 85,000 tons of production, mostly in
response to weak markets.
In April 1996, the Company completed the previously announced reconfiguration
of its Vancouver, Washington, paper mill by permanently shutting down the
mill's three paper machines and recycled wastepaper operation. The mill will
operate as a paper converting facility, converting papers made elsewhere by
the Company primarily into security papers. In the fourth quarter of 1995,
the Company recorded a pretax charge of $74.9 million, most of which was
related to the reconfiguration of this mill.
Paper segment manufacturing costs were $593 per ton compared with $563 per ton
in the comparison quarter. The increase is primarily due to fixed costs being
spread over a smaller number of tons of paper produced.
Operating income in the office products segment improved in the first quarter
of 1996 to $27.6 million, compared with $12.6 million in the prior-year
quarter. Total sales rose 52% to $461.4 million, compared with $303.3 million
in the first quarter of 1995. The growth in sales resulted from increased
national accounts business, rapid growth in the Company's direct marketing
business, acquisitions, and somewhat higher paper prices and volume.
Excluding the effect of acquisitions since December 31, 1994, sales increased
18% in the first quarter of 1996 compared with sales in the first quarter of
1995. Gross and operating margins continued to be strong and were
substantially higher in the first quarter relative to the year-ago first
quarter primarily because of improved margins in national account business and
higher paper prices.
Building products operating income decreased from $23.5 million for the year-
ago first quarter to $.9 million in the first quarter of 1996. Lower prices
for plywood, lumber, and residual wood chips contributed to the decrease in
income. Relative to the year-ago quarter, average prices for lumber
decreased 11%, while plywood prices decreased 12%. Unit sales volume for
lumber decreased 9%, while plywood sales volume increased 1% compared with the
year-ago volume. In the engineered wood products business, sales increased
17% while the price for I-joists declined 4% compared with last year. Sales
for the building products segment declined 12% to $348.0 million in the first
quarter of 1996 from $393.4 million in the first quarter of 1995. Building
materials distribution sales were flat for the comparison quarters.
Interest expense was $30.6 million in the first quarter of 1996, compared with
$37.2 million in the same period last year. The Company's debt is
predominately fixed rate. Consequently, when there are changes in short-term
market interest rates, the Company experiences only modest changes in interest
expense.
Total long- and short-term debt outstanding was $1.9 billion at March 31,
1996, compared with $1.6 billion at December 31, 1995.
Financial Condition
At March 31, 1996, the Company had working capital of $518.7 million. Working
capital was $298.4 million at March 31, 1995, and $543.3 million at
December 31, 1995. Cash provided by operations was $33.5 million for the
first three months of 1996, compared with $145.1 million for the same period
in 1995.
The Company's revolving credit agreement requires the Company to maintain a
minimum amount of net worth and not to exceed a maximum ratio of debt to net
worth. The Company's net worth at March 31, 1996, exceeded the defined
minimum amount by $141.9 million. The payment of dividends by the Company is
dependent upon the existence of and the amount of net worth in excess of the
defined minimum under this agreement. The Company is also required to
maintain a defined minimum interest coverage in each successive four-quarter
period. The Company met this requirement at March 31, 1996.
Capital expenditures for the first three months of 1996 and 1995 were
$320 million and $59 million. Capital expenditures for the year ended
December 31, 1995, were $428 million. The increase in capital expenditures is
primarily due to acquisitions by the Company's majority-owned subsidiary,
Boise Cascade Office Products Corporation, and capital spending related to the
Jackson, Alabama, paper mill expansion.
On October 16, 1995, the Company announced its intent to form a joint venture
with Companhia Suzano de Papel e Celulose ("Suzano"), a Brazilian pulp and
paper producer, to acquire, operate, and expand the Company's pulp and paper
mill, timberlands, sawmill, and wastepaper recycling plant in Jackson,
Alabama. In April 1996, the Company announced that it had discontinued talks
with Suzano regarding formation of the joint venture. Regardless, the
Company will complete the expansion of the mill, including construction of a
new uncoated free sheet paper machine, which represents a $290 million capital
investment. The Company will consider other financing alternatives, but there
is no assurance that any such alternative will be acceptable to the Company.
The new paper machine should begin production in the second quarter of 1997.
An expanded discussion and analysis of financial condition is presented on
pages 18 and 19 of the Company's 1995 Annual Report under the captions
"Financial Condition" and "Capital Investment."
Market Conditions
Lower average prices for paper and market pulp, along with market- and
maintenance-related production curtailments, are expected to depress further
second-quarter operating results for the Company's paper business. The office
products business, on the other hand, should continue to perform well in the
second quarter as growth is fueled by internal expansion and acquisitions.
The building products business should experience seasonal improvement in the
second quarter.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Reference is made to the registrant's annual report on Form 10-K for the year
ended December 31, 1995, for information concerning certain legal proceedings.
In addition, on March 12, 1996, a lawsuit purporting to be a nationwide class
action was filed against the Company in the Fourth Judicial District Court,
Ada County, Idaho. This lawsuit alleges, among other allegations, that
hardboard siding manufactured by the Company, which was used as exterior
cladding for buildings, was inherently defective. The purported class, which
has not been certified, is alleged to consist of all owners of buildings or
structures in the United States on which hardboard siding manufactured by the
Company is installed. The Complaint seeks, among other items, to declare the
Company financially responsible for the repair and replacement of all such
siding, to make restitution to the class members, and to award each class
member compensatory and punitive damages. The Company discontinued
manufacturing the hardboard siding product which is the subject of this
litigation in 1984. The Company believes that there are valid factual and
legal defenses to this case and will vigorously defend all claims asserted by
the Plaintiffs.
The Company is involved in other litigation and administrative proceedings
primarily arising in the normal couse of its business. In the opinion of
management, the Company's recovery, if any, or the Company's liability, if
any, under any pending litigation or administrative proceeding, including that
described in the preceding paragraph, would not materially affect its
financial condition or operations.
Item 2. Changes in Securities
The payment of dividends by the Company is dependent upon the existence of and
the amount of net worth in excess of the defined minimum under the Company's
revolving credit agreement. At March 31, 1996, under this agreement, the
Company's net worth exceeded the defined minimum amount by $141.9 million.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
A list of the exhibits required to be filed as part of this report
is set forth in the Index to Exhibits, which immediately precedes
such exhibits, and is incorporated herein by this reference.
(b) Reports on Form 8-K.
The Company filed a Form 8-K with the Securities and Exchange
Commission on January 18, 1996, to file a copy of its announcement
on fourth-quarter income. The Form 8-K also reports the ratio of
earnings to fixed charges for the year ended December 31, 1995.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BOISE CASCADE CORPORATION
As Duly Authorized Officer and
Chief Accounting Officer: /s/Tom E. Carlile
Tom E. Carlile
Vice President and Controller
Date: May 10, 1996
BOISE CASCADE CORPORATION
INDEX TO EXHIBITS
Filed With the Quarterly Report on Form 10-Q
for the Quarter Ended March 31, 1996
Number Description Page Number
3 Restated Certificate of Incorporation, as
Amended to Date
12 Ratio of Earnings to Fixed Charges
27 Financial Data Schedule
RESTATED CERTIFICATE OF INCORPORATION OF
BOISE CASCADE CORPORATION
The corporation's present name is that shown above. The
corporation was originally incorporated under the name of BOISE
PAYETTE LUMBER COMPANY OF DELAWARE and the date of filing of its
original Certificate of Incorporation with the Delaware Secretary
of State was April 23, 1931. This Restated Certificate of
Incorporation was adopted by the board of directors of Boise
Cascade Corporation on April 19, 1996, in accordance with the
provisions of Section 245 of the General Corporation Law of the
state of Delaware. This Restated Certificate of Incorporation
only restates and integrates and does not further amend the
provisions of the Certificate of Incorporation of the corporation
as heretofore amended, supplemented, or restated, and there is no
discrepancy between those provisions and the provisions of this
Restated Certificate of Incorporation. The capital of the
corporation will not be reduced under or by reason of this
restatement of the Restated Certificate of Incorporation.
FIRST: The name of this corporation is BOISE CASCADE
CORPORATION.
SECOND: Its registered office in the state of Delaware is
located at Corporation Trust Center, 1209 Orange Street, in the
city of Wilmington, county of New Castle. The name and address
of its registered agent is The Corporation Trust Company,
Corporation Trust Center, 1209 Orange Street, Wilmington,
Delaware 19801.
THIRD: The nature of the business, or objects or purposes to
be transacted, promoted, or carried on are:
(a) To engage in and carry on the business of acquiring,
owning, buying, selling, leasing, mortgaging, and exchanging
timber and timberlands, and in manufacturing, distributing,
marketing, or otherwise dealing in timber and lumber and all of
the various products thereof, and to carry on in any capacity any
business pertaining to, or which in the judgment of the corpora-
tion may at any time be convenient and lawfully conducted in
conjunction with, any of the matters aforesaid.
(b) To acquire, own, lease, occupy, use, or develop any
lands containing timber or containing coal, iron, manganese,
stone, or any other ores or minerals of any nature, or oil or any
woodlands or any other lands for any purposes.
(c) To erect, install, and operate lumber mills, sawmills,
paper mills, smelters, or any other mills or manufacturing plants
of any nature. To construct, operate, and equip private logging
railroads to be used and operated only for the purpose of
carrying on the business of this corporation and not as a public
carrier.
(d) To manufacture, purchase, or otherwise acquire, invest
in, own, mortgage, pledge, sell, assign, and transfer or other-
wise dispose of, trade, deal in, and deal with goods, wares, and
merchandise and personal property of every class and description.
(e) To acquire, and pay for in cash, stock, or bonds of this
corporation or otherwise, the good will, rights, assets, and
property, and to undertake or assume the whole or any part of the
obligations or liabilities of any person, firm, association, or
corporation.
(f) To acquire, hold, use, sell, assign, lease, grant
licenses in respect of, mortgage, or otherwise dispose of letters
patent of the United States or any foreign country, patent
rights, licenses and privileges, inventions, improvements and
processes, copyrights, trademarks, and trade names.
(g) To acquire by purchase, subscription, or otherwise, and
to receive, hold, own, guarantee, sell, assign, exchange,
transfer, mortgage, pledge, or otherwise dispose of or deal in
and with any of the shares of the capital stock, or any voting
trust certificates in respect of the shares of capital stock,
scrip, warrants, rights, bonds, debentures, notes, trust
receipts, and other securities, obligations, choses in action and
evidences of indebtedness or interest issued or created by any
corporations, joint stock companies, syndicates, associations,
firms, trusts, or persons, public or private, or by the govern-
ment of the United States of America, or by any foreign govern-
ment, or by any state, territory, province, municipality, or
other political subdivision or by any governmental agency, and as
owner thereof to possess and exercise all the rights, powers, and
privileges of ownership, including the right to execute consents
and vote thereon, and to do any and all acts and things necessary
or advisable for the preservation, protection, improvement, and
enhancement in value thereof.
(h) To enter into, make, and perform contracts of every kind
and description with any person, firm, association, corporation,
municipality, county, state, body politic, or government or
colony or dependency thereof.
(i) To borrow or raise moneys for any purposes of the
corporation and, from time to time without limit as to amount, to
draw, make, accept, endorse, execute, and issue promissory notes,
draft, bills of exchange, warrants, bonds, debentures, and other
negotiable or nonnegotiable instruments and evidences of
indebtedness, and to secure the payment of any thereof and of the
interest thereon by mortgage upon or pledge, conveyance, or
assignment in trust of the whole or any part of the property of
the corporation, whether at the time owned or thereafter
acquired, and to sell, pledge, or otherwise dispose of such bonds
or other obligations of the corporation for its corporate
purposes.
(j) To loan to any person, firm, or corporation any of its
surplus funds, either with or without security.
(k) To purchase, hold, sell, and transfer the shares of its
own capital stock; provided it shall not use its funds or
property for the purchase of its own shares of capital stock when
such use would cause any impairment of its capital except as
otherwise permitted by law, and provided further that shares of
its own capital stock belonging to it shall not be voted upon
directly or indirectly.
(l) To have one or more offices and to carry on all or any
of its operations and business in any of the states, districts,
territories, or colonies of the United States, and in any and all
foreign countries, subject to the laws of such state, district,
territory, colony, or country.
(m) Without restriction or limit as to amount, to purchase
or otherwise acquire, hold, own, improve, convert, mortgage,
sell, lease, convey, or otherwise dispose of or deal in, as a
real estate agent, builder, contractor, or otherwise, real and
personal property of every class and description in any of the
states, districts, territories, or colonies of the United States,
and in any and all foreign countries, subject to the laws of such
state, district, territory, colony, or country.
(n) To enter into partnership, joint venture, or other
arrangement with any person, corporation, partnership, or other
entity or entities for the purpose of engaging in any business or
transaction which the corporation is authorized to carry on; and
to invest in, lend money to, and otherwise assist any such
partnership or venture.
(o) In general, to carry on any other business and to have
and exercise all the powers conferred by the laws of Delaware
upon corporations formed under the General Corporation Law of the
state of Delaware, and to do any or all of the things herein-
before set forth to the same extent as natural persons might or
could do.
The objects and purposes specified in the foregoing clauses
shall, except where otherwise expressed, be in nowise limited or
restricted by reference to, or inference from, the terms of any
other clause in this Certificate of Incorporation, but the
objects and purposes specified in each of the foregoing clauses
of this article shall be regarded as independent objects and
purposes.
FOURTH: The total number of shares of all classes of stock
which the corporation shall have authority to issue is two
hundred ten million (210,000,000), of which two hundred million
(200,000,000) shares of the par value of $2.50 each are to be of
a class designated Common Stock and ten million
(10,000,000) shares without par value are to be of a class
designated Preferred Stock. The Preferred Stock shall be
issuable in series.
1. Common Stock Provisions.
1.1 Dividend Rights. Subject to provisions of law and
the preferences of the Preferred Stock, the holders of the Common
Stock shall be entitled to receive dividends at such time and in
such amounts as may be determined by the board of directors.
1.2 Voting Rights. Except as provided in the final two
paragraphs of Section 2.6, the holders of the Common Stock shall
have one vote for each share on each matter submitted to a vote
of the stockholders of the corporation. Except as otherwise
provided by law or by the provisions of the Certificate of
Incorporation or any amendment thereto or by resolutions of the
board of directors providing for the issue of any series of
Preferred Stock, the holders of the Common Stock shall have sole
voting power.
1.3 Liquidation Rights. In the event of any liquidation,
dissolution, or winding up of the corporation, whether voluntary
or involuntary, after payment or provision for payment of the
debts and other liabilities of the corporation and the preferen-
tial amounts to which the holders of the Preferred Stock shall be
entitled, the holders of the Common Stock shall be entitled to
share ratably in the remaining assets of the corporation.
2. Preferred Stock Provisions.
2.1 Authority of the Board of Directors to Issue in
Series. The Preferred Stock may be issued from time to time in
one or more series. Subject to the provisions of the Certificate
of Incorporation or any amendment thereto, authority is expressly
granted to the board of directors to authorize the issue of one
or more series of Preferred Stock, and to fix by resolutions
providing for the issue of each such series the voting powers,
designations, preferences and relative, participating, optional,
or other special rights, and qualifications, limitations, and
restrictions thereof (sometimes referred to as powers,
preferences, and rights) to the full extent now or hereafter
permitted by law, including but not limited to the following:
(a) The number of shares of such series (which may
subsequently be increased by resolutions of the board of
directors) and the distinctive designation thereof;
(b) The dividend rate of such series and any
limitations, restrictions, or conditions on the payment of such
dividends;
(c) The price or prices at which, and the terms and
conditions on which, the shares of such series may be redeemed;
(d) The amounts which the holders of the shares of
such series are entitled to receive upon any liquidation,
dissolution, or winding up of the corporation;
(e) The terms of any purchase, retirement, or sinking
fund to be provided for the shares of such series;
(f) The terms, if any, upon which the shares of such
series shall be convertible into or exchangeable for shares of
any other series, class or classes, or other securities, and the
terms and conditions of such conversion or exchange; and
(g) The voting powers, if any (not to exceed one vote
per share), of such series in addition to the voting powers
provided in Sections 2.6 and 2.8.
The Preferred Stock of each series shall rank on a
parity with the Preferred Stock of every other series in priority
of payment of dividends and in the distribution of assets in the
event of any liquidation, dissolution, or winding up of the
corporation, whether voluntary or involuntary, to the extent of
the preferential amounts to which the Preferred Stock of the
respective series shall be entitled under the provisions of the
Certificate of Incorporation or any amendment thereto or the
resolutions of the board of directors providing for the issue of
such series. All shares of any one series of Preferred Stock
shall be identical except as to the dates of issue and the dates
from which dividends on shares of the series issued on different
dates shall accumulate (if cumulative).
2.2 Definitions.
(a) The term "arrearages," whenever used in connection
with dividends on any share of Preferred Stock, shall refer to
the condition that exists as to dividends, to the extent that
they are cumulative (either unconditionally, or conditionally to
the extent that the conditions have been fulfilled), on such
share which shall not have been paid or declared and set apart
for payment to the date or for the period indicated, but the term
shall not refer to the condition that exists as to dividends, to
the extent that they are noncumulative, on such share which shall
not have been paid or declared and set apart for payment.
(b) The term "stock junior to the Preferred Stock,"
whenever used with reference to the Preferred Stock, shall mean
the Common Stock and other stock of the corporation over which
the Preferred Stock has preference or priority in the payment of
dividends or in the distribution of assets on any dissolution,
liquidation, or winding up of the corporation.
(c) The term "subsidiary" shall mean any corporation,
association, or business trust, the majority of whose outstanding
shares (at the time of determination) having voting power for the
election of directors or trustees, either at all times or only so
long as no senior class of shares has such voting power because
of arrearages in dividends or because of the existence of some
default, is owned directly or indirectly by the corporation.
2.3 Dividend Rights.
(a) The holders of the Preferred Stock of each series
shall be entitled to receive, when and as declared by the board
of directors, preferential dividends in cash payable at such
rate, from such date, and on such quarterly dividend payment
dates and, if cumulative, cumulative from such date or dates, as
may be fixed by the provisions of the Certificate of
Incorporation or any amendment thereto or by the resolutions of
the board of directors providing for the issue of such series.
The holders of the Preferred Stock shall not be entitled to
receive any dividends thereon other than those specifically
provided for by the Certificate of Incorporation or any amendment
thereto, or such resolutions of the board of directors, nor shall
any arrearages in dividends on the Preferred Stock bear any
interest.
(b) So long as any of the Preferred Stock is
outstanding, no dividends (other than dividends payable in stock
junior to the Preferred Stock and cash in lieu of fractional
shares in connection with any such dividend) shall be paid or
declared in cash or otherwise, nor shall any other distribution
be made, on any stock junior to the Preferred Stock, unless
(i) There shall be no arrearages in dividends on
Preferred Stock for any past quarterly dividend period, and
dividends in full for the current quarterly dividend period shall
have been paid or declared on all Preferred Stock (cumulative and
noncumulative); and
(ii) The corporation shall have 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 the Preferred Stock of any series; and
(iii) The corporation shall not be in default on any
of its obligations to redeem any of the Preferred Stock.
(c) So long as any of the Preferred Stock is
outstanding, no shares of any stock junior to the Preferred Stock
shall be purchased, redeemed, or otherwise acquired by the
corporation or by any subsidiary except in connection with a
reclassification or exchange of any stock junior to the Preferred
Stock through the issuance of other stock junior to the Preferred
Stock, or the purchase, redemption, or other acquisition of any
stock junior to the Preferred Stock, with proceeds of a reason-
ably contemporaneous sale of other stock junior to the Preferred
Stock, nor shall any funds be set aside or made available for any
sinking fund for the purchase or redemption of any stock junior
to the Preferred Stock, unless
(i) There shall be no arrearages in dividends on
Preferred Stock for any past quarterly dividend period; and
(ii) The corporation shall have 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 the Preferred Stock of any series; and
(iii) The corporation shall not be in default on any
of its obligations to redeem any of the Preferred Stock.
(d) Subject to the foregoing provisions and not
otherwise, such dividends (payable in cash, property, or stock
junior to the Preferred Stock) as may be determined by the board
of directors may be declared and paid on the shares of any stock
junior to the Preferred Stock from time to time, and in the event
of the declaration and payment of any such dividends, the holders
of such junior stock shall be entitled, to the exclusion of
holders of the Preferred Stock, to share ratably therein
according to their respective interests.
(e) Dividends in full shall not be declared or paid or
set apart for payment on any series of Preferred Stock unless
there shall be no arrearages in dividends on Preferred Stock for
any past quarterly dividend period and dividends in full for the
current quarterly dividend period shall have been paid or
declared on all Preferred Stock to the extent that such dividends
are cumulative, and any dividends paid or declared when dividends
are not so paid or declared in full shall be shared ratably by
the holders of all series of Preferred Stock in proportion to
such respective arrearages and unpaid and undeclared current
quarterly cumulative dividends.
2.4 Liquidation Rights.
(a) In the event of any liquidation, dissolution, or
winding up of the corporation, whether voluntary or involuntary,
the holders of Preferred Stock of each series shall be entitled
to receive the full preferential amount fixed by the Certificate
of Incorporation or any amendment thereto, or by the resolutions
of the board of directors providing for the issue of such series,
including any arrearages in dividends thereon to the date fixed
for the payment in liquidation, before any distribution shall be
made to the holders of any stock junior to the Preferred Stock.
After such payment in full to the holders of the Preferred Stock,
the remaining assets of the corporation shall then be
distributable exclusively among the holders of any stock junior
to the Preferred Stock, according to their respective interests.
(b) If the assets of the corporation are insufficient
to permit the payment of the full preferential amounts payable to
the holders of the Preferred Stock of the respective series in
the event of a liquidation, dissolution, or winding up, then the
assets available for distribution to holders of the Preferred
Stock shall be distributed ratably to such holders in proportion
to the full preferential amounts payable on the respective
shares.
(c) A consolidation or merger of the corporation with
or into one or more other corporations or a sale of all or
substantially all of the assets of the corporation shall not be
deemed to be a liquidation, dissolution, or winding up, voluntary
or involuntary.
2.5 Redemption.
(a) Subject to the provisions of paragraph (a)(v) of
Section 2.6, the corporation may, at the option of the board of
directors, redeem the whole or any part of the Preferred Stock,
or of any series thereof, at any time or from time to time within
the period during which such stock is by its terms redeemable at
the option of the board of directors, by paying such redemption
price thereof as shall have been fixed by the Certificate of
Incorporation or any amendment thereto or by the resolutions of
the board of directors providing for the issue of the Preferred
Stock to be redeemed, including an amount in the case of each
share so to be redeemed equal to any arrearages in dividends
thereon to the date fixed for redemption (the total amount so to
be paid being hereinafter called the "redemption price").
(b) Unless expressly provided otherwise in the
Certificate of Incorporation or any amendment thereto or by the
resolutions of the board of directors providing for the issue of
the Preferred Stock to be redeemed, (i) notice of each such
redemption shall be mailed not less than 30 days nor more than
90 days prior to the date fixed for redemption to each holder of
record of shares of the Preferred Stock to be redeemed, at his
address as the same may appear on the books of the corporation,
and (ii) in case of a redemption of a part only of any series of
the Preferred Stock, the shares of such series to be redeemed
shall be selected pro rata or by lot or in such other manner as
the board of directors may determine. The board of directors
shall have full power and authority, subject to the limitations
and provisions contained in the Certificate of Incorporation or
any amendment thereto or in the resolutions of the board of
directors providing for the issue of the Preferred Stock to be
redeemed, to prescribe the manner in which and the terms and
conditions upon which the Preferred Stock may be redeemed from
time to time.
(c) If any such notice of redemption shall have been
duly given, then on and after the date fixed in such notice of
redemption (unless default shall be made by the corporation in
the payment or deposit of the redemption price pursuant to such
notice) all arrearages in dividends, if any, on the shares of
Preferred Stock so called for redemption shall cease to
accumulate, and on such date all rights of the holders of the
Preferred Stock so called for redemption shall cease and
terminate except the right to receive the redemption price upon
surrender of their certificates for redemption and such rights,
if any, of conversion or exchange as may exist with respect to
such Preferred Stock under the provisions of the Certificate of
Incorporation or any amendment thereto or in the resolutions of
the board of directors providing for the issue of such Preferred
Stock.
(d) If, before the redemption date specified in any
notice of the redemption of any Preferred Stock, the corporation
shall deposit the redemption price with a bank or trust company
in New York, New York, having a capital and surplus of at least
$10,000,000 according to its last published statement of condi-
tion, in trust for payment on the redemption date to the holders
of the Preferred Stock to be redeemed, from and after the date of
such deposit all rights of the holders of the Preferred Stock so
called for redemption shall cease and terminate except the right
to receive the redemption price upon surrender of their
certificates for redemption and such rights, if any, of conver-
sion or exchange as may exist with respect to such Preferred
Stock under the provisions of the Certificate of Incorporation or
any amendment thereto or in the resolutions of the board of
directors providing for the issue of such Preferred Stock. Any
funds so deposited which are not required for such redemption
because of the exercise of any such right of conversion or
exchange subsequent to the date of such deposit shall be returned
to the corporation forthwith. The corporation shall be entitled
to receive from the depository, from time to time, the interest,
if any, allowed on such funds deposited with it, and the holders
of the shares so redeemed shall have no claim to any such
interest. Any funds so deposited and remaining unclaimed at the
end of six years from the redemption date shall, if thereafter
requested by the board of directors, be repaid to the
corporation.
(e) Shares of Preferred Stock of any series may also
be subject to redemption, in the manner hereinabove prescribed
under this Section 2.5, through operation of any sinking or
retirement fund created therefor, at the redemption prices and
under the terms and provisions contained in the resolutions of
the board of directors providing for the issue of such series.
(f) The corporation shall not be required to register
a transfer of any share of Preferred Stock (i) within 15 days
preceding a selection for redemption of shares of the series of
Preferred Stock of which such share is a part or (ii) which has
been selected for redemption.
(g) If any obligation to retire shares of Preferred
Stock is not paid in full on all series as to which such obliga-
tion exists, the number of shares of each such series to be
retired pursuant to any such obligation shall be in proportion to
the respective amounts which would be payable if all amounts
payable for the retirement of all such series were discharged in
full.
2.6 Restrictions on Certain Action Affecting Preferred
Stock. The corporation will not, without the consent given in
writing or affirmative vote given in person or by proxy at a
meeting held for the purpose,
(a) By the holders of at 66 2/3% of the shares of
Preferred Stock then outstanding,
(i) Amend, alter, or repeal any of the provisions
of the Certificate of Incorporation, or any amendment thereto, or
the bylaws, of the corporation, so as to affect adversely the
powers, preferences, or rights of the holders of the Preferred
Stock or reduce the time for any notice to which only the holders
of the Preferred Stock may be entitled; provided, however, the
amendment of the provisions of the Certificate of Incorporation,
as amended, so as to authorize or create, or to increase the
authorized amount of Common Stock or other stock junior to the
Preferred Stock or any stock of any class ranking on a parity
with the Preferred Stock shall not be deemed to affect adversely
the powers, preferences, or rights of the holders of the
Preferred Stock;
(ii) Authorize or create, or increase the authorized
amount of, any stock of any class or any security convertible
into stock of any class ranking prior to the Preferred Stock;
(iii) Voluntarily dissolve, liquidate, or wind up the
affairs of the corporation, or sell, lease, or convey all or
substantially all its property and assets;
(iv) Merge or consolidate with or into any other
corporation, unless each holder of Preferred Stock immediately
preceding such merger or consolidation shall receive in the
resulting corporation the same number of shares, with substan-
tially the same rights and preferences, as correspond to the
Preferred Stock so held (in determining whether the shares in the
resulting corporation so received have substantially the same
rights and preferences the circumstance that such shares may
constitute a different proportion of the ordinary voting power in
the resulting corporation than the Preferred Stock constitutes of
such voting power in the corporation shall be disregarded), and
unless the corporation resulting from such merger or consolida-
tion will have after such merger or consolidation no class of
stock either authorized or outstanding ranking prior to the
shares received by such holder and no securities either
authorized or outstanding which are convertible into such prior
stock, except the same number of shares of prior stock and the
same amount of such convertible securities, with the same rights
and preferences, as correspond to the prior stock of the corpora-
tion and securities convertible into prior stock of the corpora-
tion, respectively, authorized and outstanding immediately
preceding such merger or consolidation; or
(v) Purchase or redeem less than all of the
Preferred Stock at the time outstanding unless the full cumula-
tive dividend on all shares of Preferred Stock then outstanding
shall have been paid or declared and a sum sufficient for payment
thereof set apart;
(b) By the holders of at 66 2/3% of the shares of any
series of Preferred Stock then outstanding, amend, alter, or
repeal any of the provisions of the Certificate of Incorporation
or any amendment thereto, or the bylaws, or of the resolutions of
the board of directors providing for the issue of such series so
as to affect adversely the powers, preferences, or rights of the
holders of the Preferred Stock of such series in a manner not
equally applicable to all series of Preferred Stock; or
(c) By the holders of at least a majority of the
shares of Preferred Stock then outstanding,
(i) Increase the authorized amount of the Preferred
Stock; or
(ii) Create any other class or classes of stock
ranking on a parity with the Preferred Stock, either as to
dividends or upon liquidation, or create any stock or other
security convertible into or exchangeable for or evidencing the
right to purchase any such stock ranking on a parity with the
Preferred Stock, or increase the authorized number of shares of
any such other class of stock or other security;
provided, however, that no such consent of the holders of the
Preferred Stock shall be required if, at or prior to the time
when such amendment, alteration, or repeal is to take effect or
when the issuance of any such prior 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 to be made for the redemption of all shares of
Preferred Stock at the time outstanding, or, in the case of any
such amendment, alteration, or repeal as to which the consent of
less than all the Preferred Stock would otherwise be required,
for the redemption of all shares of Preferred Stock the consent
of which would otherwise be required.
If an amendment described in clause (i) of paragraph (a)
of this Section 2.6 would in no way affect adversely the powers,
preferences, or rights of the holders of any stock of the
corporation other than the Preferred Stock, such amendment may,
to the extent permitted by Delaware law, be made effective by the
adoption and filing of an appropriate amendment to the
Certificate of Incorporation without obtaining the consent or
vote of the holders of any stock of the corporation other than
the Preferred Stock.
If an amendment described in paragraph (b) of this
Section 2.6 would in no way affect adversely the powers,
preferences, or rights of the holders of any stock of the
corporation other than the Preferred Stock of a particular
series, such amendment may, to the extent permitted by Delaware
law, be made effective by the adoption and filing of an appro-
priate amendment to the Certificate of Incorporation of the
corporation without obtaining the consent or vote of the holders
of any stock of the corporation other than the Preferred Stock of
such series.
2.7 Status of Preferred Stock Purchased, Redeemed, or
Converted. Shares of Preferred Stock purchased, redeemed, or
converted into or exchanged for shares of any other class or
series shall be deemed to be authorized but unissued shares of
Preferred Stock undesignated as to series.
2.8 Election of Directors by Holders of Certain Preferred
Stock in Event of Nondeclaration of Dividends.
(a) The provisions of this Section 2.8 shall apply
only to those series of Preferred Stock (applicable Preferred
Stock) to which such provisions are expressly made applicable by
the Certificate of Incorporation or any amendment thereto or
resolutions of the board of directors providing for the issue of
such series.
(b) Whenever declarations or payments of dividends
(including noncumulative dividends) on the shares of any series
of applicable Preferred Stock shall be omitted in an aggregate
amount equal to six quarterly dividends, the holders of the
applicable Preferred Stock shall have the exclusive and special
right, voting separately as a class and without regard to series,
to elect at an annual meeting of stockholders or special meeting
held in place thereof, or at a special meeting of the holders of
the applicable Preferred Stock called as hereinafter provided,
three members of the board of directors, until four consecutive
quarterly dividends shall have been paid on or declared and set
apart for payment on the shares of such series, if the shares of
such series are noncumulative, or until all arrearages in
dividends and dividends in full for the current quarterly period
shall have been paid on or declared and set apart for payment on
the shares of such series, if the shares of such series are
cumulative, whereupon all voting rights as a class provided for
under this Section 2.8 shall be divested from the applicable
Preferred Stock (subject, however, to being at any time or from
time to time similarly revived if declarations or payments of
dividends for subsequent quarterly periods shall be omitted).
(c) At any time after the holders of the applicable
Preferred Stock shall have thus become entitled to elect three
members of the board of directors, the secretary of the corpora-
tion may, and upon written request of holders of record of at
least 5% of the shares of the applicable Preferred Stock then
outstanding addressed to him at the principal office of the
corporation shall, call a special meeting of the holders of the
applicable Preferred Stock for the purpose of electing such
directors, to be held at the place of annual meetings of stock-
holders of the corporation as soon as practicable after the
receipt of such request upon the notice provided by law and the
bylaws of the corporation for the holding of special meetings of
stockholders; provided, however, the secretary need not call any
such special meeting if the next annual meeting of stockholders
is to convene within 90 days after the receipt of such request.
If such special meeting shall not be called by the secretary
within 30 days after receipt of such request (not including,
however, a request falling within the proviso to the foregoing
sentence), then the holders of record of at least 5% of the
shares of the applicable Preferred Stock then outstanding may
designate in writing one of their number to call such a meeting
at the place and upon the notice above provided, and any person
so designated for that purpose shall have access to the stock
records of the corporation for such purpose.
(d) At any meeting at which the holders of the
applicable Preferred Stock shall be entitled to vote for the
election of such three directors as above provided, the holders
of a majority of the applicable Preferred Stock then outstanding
present in person or by proxy shall constitute a quorum for the
election of such three directors and for no other purpose, and
the vote of the holders of a majority of the applicable Preferred
Stock so present at any such meeting at which there shall be such
a quorum shall be sufficient to elect three directors. The
election of any such directors shall automatically increase the
number of members of the board of directors by the number of
directors so elected. The persons so elected as directors by the
holders of the applicable Preferred Stock shall hold office until
their successors shall have been elected by such holders or until
the right of the holders of the applicable Preferred Stock to
vote as a class in the election of directors shall be divested as
provided in paragraph (b) of this Section 2.8. Upon divestment
of the right to elect directors as above provided, any directors
so elected by the holders of the applicable Preferred Stock shall
forthwith cease to be directors of the corporation, and the
number of directorships shall automatically be reduced accord-
ingly. If a vacancy occurs in a directorship elected by the
holders of the applicable Preferred Stock voting as a class, a
successor may be appointed by the remaining director or directors
so elected by the holders of the applicable Preferred Stock.
(e) At any such meeting or any adjournment thereof,
(i) the absence of a quorum of the holders of the applicable
Preferred Stock shall not prevent the election of the directors
other than those to be elected by holders of the applicable
Preferred Stock voting as a class, and the absence of a quorum of
holders of the shares entitled to vote for directors other than
those to be elected by the holders of the applicable Preferred
Stock voting as a class shall not prevent the election of the
directors to be elected by the holders of the applicable
Preferred Stock voting as a class, and (ii) in the absence of a
quorum of the holders of the applicable Preferred Stock, the
holders of a majority of the applicable Preferred Stock present
in person or by proxy shall have power to adjourn from time to
time the meeting for the election of the directors which they are
entitled to elect voting as a class, without notice other than
announcement at the meeting, until a quorum shall be present, and
in the absence of a quorum of the holders of the shares entitled
to vote for directors other than those elected by the holders of
the applicable Preferred Stock voting as a class, the holders of
a majority of such stock present in person or by proxy shall have
power to adjourn from time to time the meeting for the election
of the directors which they are entitled to elect, without notice
other than announcement at the meeting, until a quorum shall be
present.
3. Other Provisions.
3.1 Authority for Issuance of Shares. The board of
directors shall have authority to authorize the issuance, from
time to time without any vote or other action by the stock-
holders, of any or all shares of stock of the corporation of any
class at any time authorized, and any securities convertible into
or exchangeable for any such shares, in each case to such persons
and for such consideration and on such terms as the board of
directors from time to time in its discretion lawfully may deter-
mine; provided, however, the consideration for the issuance of
shares of stock of the corporation having par value shall not be
less than such par value. Shares so issued, for which the
consideration has been paid to the corporation, shall be full
paid stock, and the holders of such stock shall not be liable to
any further call or assessments thereon.
3.2 Voting for Directors. All elections of directors may
be by voice vote, rather than by ballot, unless, by resolution
adopted by the majority vote of the stockholders represented at
the meeting, the election of directors by ballot is required.
3.3 No Preemptive Rights. No holder of shares of any
class of the corporation nor of any security or obligation
convertible into, nor of any warrant, option, or right to
purchase, subscribe for, or otherwise acquire, shares of any
class of the corporation, whether now or hereafter authorized,
shall, as such holder, have any preemptive right whatsoever to
purchase, subscribe for, or otherwise acquire, shares of any
class of the corporation or of any security convertible into, or
of any warrant, option, or right to purchase, subscribe for, or
otherwise acquire, shares of any class of the corporation,
whether now or hereafter authorized.
3.4 Abandonment of Dividends and Distributions. Anything
herein contained to the contrary notwithstanding, any and all
right, title, interest, and claim in or to any dividends
declared, or other distributions made, by the corporation,
whether in cash, stock, or otherwise, which are unclaimed by the
stockholder entitled thereto for a period of six years after the
close of business on the payment date, shall be and be deemed to
be extinguished and abandoned, and such unclaimed dividends or
other distributions in the possession of the corporation, its
transfer agents, or other agents or depositaries, shall at such
time become the absolute property of the corporation, free and
clear of any and all claims of any persons whatsoever.
3.5 Record Date. The board of directors may set a record
date in the manner and for the purposes authorized in the bylaws
of the corporation, with respect to shares of stock of the
corporation of any class or series.
3.6 No Consents. Any action required or permitted to be
taken at any annual or special meeting of stockholders must be
taken at such a meeting duly called, upon proper notice to all
stockholders entitled to vote. No action required to be taken or
which may be taken at any annual or special meeting of stock-
holders may be taken without a meeting, without prior notice, and
without a vote.
4. Provisions Relating to Series D Preferred Stock. The
provisions of the Convertible Preferred Stock, Series D, of the
corporation are set forth in full in Annex I to this Restated
Certificate of Incorporation, and they are incorporated herein by
this reference thereto.
5. Provisions Relating to Series F Preferred Stock. The
provisions of the 9.40% Cumulative Preferred Stock, Series F, of
the corporation are set forth in full in Annex II to this
Restated Certificate of Incorporation, and they are incorporated
herein by this reference thereto.
6. Provisions Relating to Series G Preferred Stock. The
provisions of the Conversion Preferred Stock, Series G, of the
corporation are set forth in full in Annex III to this Restated
Certificate of Incorporation, and they are incorporated herein by
this reference thereto.
FIFTH: The amount of capital with which the corporation will
commence business is $1,000.
SIXTH: Reserved.
SEVENTH: The corporation is to have perpetual existence.
EIGHTH: The private property of the stockholders shall not be
subject to the payment of the corporate debts to any extent
whatever.
NINTH:
9.1 The business and affairs of the corporation shall be
managed by or under the direction of a board of directors. The
number of the directors of the corporation shall be fixed from
time to time by resolution adopted by the affirmative vote of a
majority of the entire board of directors of the corporation,
except that the minimum number of directors shall be fixed at no
less than three and the maximum number of directors shall be
fixed at no more than 15. The directors shall be divided into
three classes, designated Class I, Class II, and Class III. Each
class shall consist, as nearly equal in number as possible, of
one-third of the total number of directors constituting the
entire board of directors. At the 1985 meeting of stockholders,
Class I directors shall be elected for a one-year term, Class II
directors for a two-year term, and Class III directors for a
three-year term. At each succeeding annual meeting of stock-
holders beginning in 1986, successors of the class of directors
whose term expires at that annual meeting shall be elected for a
three-year term. If the number of directors is changed, any
increase or decrease shall be apportioned among the classes so as
to maintain the number of directors in each class as nearly equal
as possible.
9.2 Nominations for election to the board of directors of
the corporation at a meeting of stockholders may be made by the
board, on behalf of the board by any nominating committee
appointed by the board, or by any stockholder of the corporation
entitled to vote for the election of directors at the meeting.
Nominations, other than those made by or on behalf of the board,
shall be made by notice in writing delivered to or mailed,
postage prepaid, and received by the Corporate Secretary not less
than 30 nor more than 60 days prior to any meeting of stock-
holders called for the election of directors; provided, however,
if less than 35 days' notice or prior public disclosure of the
date of the meeting is given to stockholders, the nomination must
be received by the Corporate Secretary not later than the close
of business on the seventh day following the day on which the
notice of the meeting was mailed. The notice shall set forth:
(i) the name and address of the stockholder who intends to make
the nomination; (ii) the name, age, business address, and, if
known, residence address of each nominee; (iii) the principal
occupation or employment of each nominee; (iv) the number of
shares of stock of the corporation which are beneficially owned
by each nominee and by the nominating stockholder; (v) any other
information concerning the nominee that must be disclosed of
nominees in proxy solicitation pursuant to Regulation 14A of the
Securities Exchange Act of 1934; and (vi) the executed consent of
each nominee to serve as a director of the corporation, if
elected. The chairman of the meeting of stockholders may, if the
facts warrant, determine that a nomination was not made in
accordance with the foregoing procedures, and if the chairman
should so determine, the chairman shall so declare to the meeting
and the defective nomination shall be disregarded.
9.3 Newly created directorships resulting from any increase
in the number of directors and any vacancies on the board of
directors resulting from death, resignation, disqualification,
removal, or other cause shall be filled by the affirmative vote
of a majority of the remaining directors then in office, even
though less than a quorum, or by a sole remaining director. Any
additional director of any class elected to fill a vacancy in
such class shall hold office for a term that shall coincide with
the remaining term of that class, but in no case will a decrease
in the number of directors shorten the term of any incumbent
director. A director shall hold office until the next annual
meeting for the year in which his term expires and until such
director's successor shall have been elected and qualified.
9.4 Any director may be removed from office only with cause
and only by the affirmative vote of the holders of at least 80%
of the voting power of all the shares of the corporation entitled
to vote generally in the election of directors, voting together
as a single class.
9.5 Notwithstanding the foregoing paragraphs 9.1, 9.2, 9.3,
and 9.4, whenever the holders of any one or more classes or
series of Preferred Stock issued by the corporation shall have
the right, voting separately by class or series, to elect
directors at an annual or special meeting of stockholders, the
election, term of office, filling of vacancies, and other
features of such directorships shall be governed by the terms of
this Certificate of Incorporation applicable thereto, the then
authorized number of directors of the corporation shall be
increased by the number of additional directors to be elected,
and such directors so elected shall not be divided into classes
pursuant to this Article NINTH unless expressly provided by such
terms.
9.6 Notwithstanding anything contained in this Certificate
of Incorporation to the contrary, the affirmative vote of the
holders of at least 80% of the voting power of all the shares of
the corporation entitled to vote generally in the election of
directors, voting together as a single class, shall be required
to alter, amend, repeal, or adopt any provision inconsistent with
the purpose and intent of this Article NINTH.
9.7 In furtherance, and not in limitation of the powers
conferred by statute, the board of directors is expressly
authorized:
To make and alter the bylaws of the corporation.
To authorize and cause to be executed mortgages and liens
upon the real and personal property of the corporation.
To set apart out of any of the funds of the corporation
available for dividends a reserve or reserves for any proper
purpose or to abolish any such reserve in the manner in which it
was created.
By resolution or resolutions passed by a majority of the
whole board, to designate one or more committees, each committee
to consist of two or more of the directors of the corporation,
which, to the extent provided in said resolution or resolutions
or in the bylaws of the corporation, shall have and may exercise
the powers of the board of directors in the management of the
business and affairs of the corporation, and may have power to
authorize the seal of the corporation to be affixed to all papers
which may require it. Such committee or committees shall have
such name or names as may be stated in the bylaws of the
corporation or as may be determined from time to time by
resolution adopted by the board of directors.
The corporation may in its bylaws confer powers upon its
board of directors in addition to the foregoing, and in addition
to the powers and authorities expressly conferred upon it by
statute.
TENTH: Whenever a compromise or arrangement is proposed
between this corporation and its creditors or any class of them,
and/or between this corporation and its stockholders or any class
of them, any Court of equitable jurisdiction within the state of
Delaware may, on the application in a summary way of this
corporation or of any creditor or stockholder thereof, or on the
application of any receiver or receivers appointed for this
corporation under the provisions of Section 291 of Title 8 of the
Delaware Code or on the application of trustees in dissolution or
of any receiver or receivers appointed for this corporation under
the provisions of Section 279 of Title 8 of the Delaware Code,
order a meeting of the creditors or class of creditors, and/or of
the stockholders or class of stockholders of this corporation, as
the case may be, to be summoned in such manner as the said Court
directs. If a majority in number representing three-fourths in
value of the creditors or class of creditors, and/or of the
stockholders or class of stockholders of this corporation, as the
case may be, agree to any compromise or arrangement and to any
reorganization of this corporation as consequence of such
compromise or arrangement, the said compromise or arrangement and
said reorganization shall, if sanctioned by the Court of which
the said application has been made, be binding on all the
creditors or class of creditors, and/or on all the stockholders
or class of stockholders of this corporation, as the case may be,
and also on this corporation.
ELEVENTH: Both stockholders and directors shall have power,
if the bylaws so provide, to hold their meetings, and to have one
or more offices within or without the state of Delaware, and to
keep the books of this corporation (subject to the provisions of
the statutes), outside of the state of Delaware at such places as
may be from time to time designated by the board of directors.
TWELFTH:
12.1 In addition to any affirmative vote required by law or
this Certificate of Incorporation or the bylaws, and except as
otherwise expressly herein provided in this Article TWELFTH, a
Business Combination (as hereinafter defined) shall require the
affirmative vote of a majority of the voting power of all the
shares of Voting Stock (as hereinafter defined) held by stock-
holders other than an Interested Stockholder (as hereinafter
defined), with which or by or on whose behalf, directly or
indirectly, a Business Combination is proposed, voting together
as a single class. Such affirmative vote shall be required
notwithstanding the fact that no vote may be required, or that a
lesser percentage or separate class vote may be specified, by law
or in any agreement with any national securities exchange or
otherwise.
12.2 The provisions of Section 12.1 of this Article TWELFTH
shall not be applicable to any particular Business Combination,
and such Business Combination shall require only such affirmative
vote, if any, as is required by law or by any other provision of
this Certificate of Incorporation, the bylaws of the corporation,
or any agreement with any national securities exchange, if all
the conditions specified in either of the following para-
graphs (a) or (b) are met or, in the case of a Business
Combination not involving the payment of consideration to the
holders of the corporation's outstanding Capital Stock (as
hereinafter defined), if the condition specified in the following
paragraph (a) is met:
(a) The Business Combination shall have been approved by
a majority (whether such approval is made prior to or subsequent
to the acquisition of beneficial ownership of the Voting Stock
that caused the Interested Stockholder as hereinafter defined to
become an Interested Stockholder) of the Continuing Directors (as
hereinafter defined); or
(b) All of the following conditions shall have been met:
(1) The aggregate amount of the cash and the Fair
Market Value (as hereinafter defined) as of the date of the
consummation of the Business Combination of consideration other
than cash to be received per share by holders of Common Stock in
such Business Combination shall be at least equal to the highest
amount determined under subparagraphs (i) and (ii) below:
(i) (if applicable) The highest per-share price
(including any brokerage commissions, transfer taxes, and
soliciting dealers' fees) paid by or on behalf of the Interested
Stockholder for any shares of Common Stock in connection with the
acquisition by the Interested Stockholder of beneficial ownership
of shares of Common Stock (a) within the two-year period
immediately prior to the first public announcement of the
proposed Business Combination (the "Announcement Date") or (b) in
the transaction in which it became an Interested Stockholder,
whichever is higher; and
(ii) The Fair Market Value per share of Common Stock
on the Announcement Date or on the date on which the Interested
Stockholder became an Interested Stockholder (such latter date
referred to in this Article TWELFTH as the "Determination Date"),
whichever is higher.
All per-share prices shall be adjusted to reflect any
intervening stock splits, stock dividends, and reverse stock
splits.
(2) The aggregate amount of the cash and the Fair
Market Value as of the date of the consummation of the Business
Combination of consideration other than cash to be received per
share by holders of shares of any class or series of outstanding
Capital Stock (as hereinafter defined), other than Common Stock,
shall be at least equal to the highest amount determined under
clauses (i), (ii), and (iii) below:
(i) (if applicable) The highest per-share price
(including any brokerage commissions, transfer taxes, and
soliciting dealers' fees) paid by or on behalf of the Interested
Stockholder for any share of such class or series of Capital
Stock in connection with the acquisition by the Interested
Stockholder of beneficial ownership of shares of such class or
series of Capital Stock (a) within the two-year period
immediately prior to the Announcement Date or (b) in the
transaction in which it became an Interested Stockholder,
whichever is higher;
(ii) The Fair Market Value per share of such class
or series of Capital Stock on the Announcement Date or on the
Determination Date, whichever is higher; and
(iii) (if applicable) The highest preferential amount
per share to which the holders of shares of such class or series
of Capital Stock would be entitled in the event of any voluntary
or involuntary liquidation, dissolution, or winding up of the
corporation, regardless of whether the Business Combination to be
consummated constitutes such an event.
All per-share prices shall be adjusted for
intervening stock splits, stock dividends, and reverse stock
splits.
The provisions of this paragraph (b)(2) shall be
required to be met with respect to every class or series of
outstanding Capital Stock, whether or not the Interested
Stockholder has previously acquired beneficial ownership of any
shares of a particular class or series of Capital Stock.
(3) The consideration to be received by holders of a
particular class or series of outstanding Capital Stock (includ-
ing Common Stock) shall be cash or in the same form as previously
has been paid by or on behalf of the Interested Stockholder in
connection with its direct or indirect acquisition of beneficial
ownership of shares of such class or series of Capital Stock. If
the consideration so paid for shares of any class or series of
Capital Stock varied as to form, the form of consideration for
such class or series of Capital Stock shall be either cash or the
form used to acquire beneficial ownership of the largest number
of shares of such class or series of Capital Stock previously
acquired by the Interested Stockholder.
(4) After such Interested Stockholder has become an
Interested Stockholder and prior to the consummation of such
Business Combination: (a) except as approved by a majority of
the Continuing Directors, there shall have been no failure to
declare and pay at the regular date therefor any full quarterly
dividends (whether or not cumulative) in accordance with the
terms of the outstanding Preferred Stock; (b) there shall have
been (1) no reduction in the annual rate of dividend paid on the
Common Stock (except as necessary to reflect any stock split,
stock dividend, or subdivision of the Common Stock), except as
approved by a majority of the Continuing Directors; and (2) an
increase in such annual rate of dividends as necessary to reflect
any reclassification (including any reverse stock split),
recapitalization, reorganization, or any similar transaction
which has the effect of reducing the number of outstanding shares
of the Common Stock, unless the failure so to increase such
annual rate is approved by a majority of the Continuing
Directors; and (c) such Interested Stockholder shall have not
become the beneficial owner of any additional shares of Voting
Stock except as part of the transaction which results in such
Interested Stockholder becoming an Interested Stockholder and
except in a transaction that, after giving effect thereto, would
not result in any increase in the Interested Stockholder's
percentage beneficial ownership of any class or series of Capital
Stock.
(5) After such Interested Stockholder has become an
Interested Stockholder, such Interested Stockholder shall not
have received the benefit, directly or indirectly (except
proportionately as a stockholder), of any loans, advances,
guarantees, pledges, or other financial assistance or any tax
credits or other tax advantages provided by the corporation,
whether in anticipation of or in connection with such Business
Combination or otherwise.
(6) A proxy or information statement describing the
proposed Business Combination and complying with the requirements
of the Securities Exchange Act of 1934 and the rules and regula-
tions thereunder (or any subsequent provisions replacing such
Act, rules, or regulations) shall be mailed to public stock-
holders of the corporation at least 30 days prior to the
consummation of such Business Combination (whether or not such
proxy or information statement is required to be mailed pursuant
to such Act or subsequent provisions). The proxy or information
statement shall contain on the first page thereof, in a prominent
place, any statement as to the advisability (or inadvisability)
of the Business Combination that the Continuing Directors, or any
of them, may choose to make and, if deemed advisable by a
majority of the Continuing Directors, the opinion of an invest-
ment banking firm selected by a majority of the Continuing
Directors as to the fairness (or not) of the terms of the
Business Combination from a financial point of view to the
holders of the outstanding shares of Capital Stock other than the
Interested Stockholder and its Affiliates or Associates (as
hereinafter defined), such investment banking firm to be paid a
reasonable fee for its services by the corporation.
(7) Such Interested Stockholder shall not have made
any major change in the corporation's business or equity capital
structure without the approval of a majority of the Continuing
Directors.
12.3 For the purposes of this Article TWELFTH:
(a) The term "Business Combination" shall mean:
(1) Any merger or consolidation of the corporation or
any Subsidiary (as hereinafter defined) with (a) any Interested
Stockholder or (b) any other company (whether or not such other
company is an Interested Stockholder) which is, or after such
merger or consolidation would be, an Affiliate or Associate of an
Interested Stockholder; or
(2) Any sale, lease, exchange, mortgage, pledge,
transfer, or other disposition or security arrangement, invest-
ment, loan, advance, guarantee, agreement to purchase, agreement
to pay, extension of credit, joint venture participation, or
other arrangement (in one transaction or a series of transac-
tions) with or for the benefit of any Interested Stockholder or
any Affiliate or Associate of any Interested Stockholder involv-
ing any assets, securities, or commitments of the corporation,
any Subsidiary or any Interested Stockholder or any Affiliate or
Associate of any Interested Stockholder having an aggregate Fair
Market Value and/or involving aggregate commitments of
$40,000,000 or more or constituting more than 5% of the book
value of the total assets (in the case of transactions involving
assets or commitments other than capital stock) or 5% of stock-
holders' equity (in the case of transactions involving capital
stock) of the entity in question (the "Substantial Part"), as
reflected in the most recent fiscal year-end consolidated balance
sheet of such entity existing at the time the stockholders of the
corporation would be required to approve or authorize the
Business Combination involving the assets, securities, and/or
commitments constituting any Substantial Part; or
(3) The adoption of any plan or proposal for the
liquidation or dissolution of the corporation proposed by or on
behalf of any Interested Stockholder or any Affiliate or
Associate of any Interested Stockholder; or
(4) Any reclassification of securities (including any
reverse stock split), or recapitalization of the corporation or
any merger or consolidation of the corporation with any of its
Subsidiaries or any other transaction (whether or not with or
otherwise involving an Interested Stockholder) that has the
effect, directly or indirectly, of increasing the proportionate
share of the outstanding shares of any class or series of Capital
Stock, or any securities convertible into Capital Stock, or into
equity securities of any Subsidiary, that is beneficially owned
by any Interested Stockholder or any Affiliate or Associate of
any Interested Stockholder; or
(5) Any agreement, contract, or other arrangement
providing for any one or more of the actions specified in the
foregoing clauses (1) through (4).
(b) The term "Capital Stock" shall mean all capital stock
of this corporation authorized to be issued from time to time
under Article FOURTH of this Certificate of Incorporation, and
the term "Voting Stock" shall mean all Capital Stock which by its
terms may be voted on all matters submitted to stockholders of
the corporation generally.
(c) A "person" shall mean any individual, firm,
corporation, partnership, trust, or other entity and shall
include any group comprised of any person and any other person
with whom such person or any Affiliate or Associate of such
person has any agreement, arrangement, or understanding, directly
or indirectly, for the purpose of acquiring, holding, voting, or
disposing of Capital Stock.
(d) "Interested Stockholder" shall mean any person (other
than the corporation or any Subsidiary and other than any profit-
sharing, employee stock ownership, or other employee benefit plan
of the corporation or any Subsidiary or any trustee of or
fiduciary with respect to any such plan when acting in such
capacity) who or which:
(1) Is the beneficial owner, directly or indirectly,
of more than 10% of the voting power of the then outstanding
Voting Stock; or
(2) Is an Affiliate or Associate of the corporation
and at any time within the two-year period immediately prior to
the date in question was the beneficial owner of 10% or more of
the voting power of the then outstanding Voting Stock; or
(3) Is an assignee of or has otherwise succeeded to
any shares of Voting Stock which were at any time within the
two-year period immediately prior to the date in question
beneficially owned by any Interested Stockholder, if such
assignment or succession shall have occurred in the course of a
transaction or series of transactions not involving a public
offering within the meaning of the Securities Act of 1933.
(e) A person shall be a "beneficial owner" of any Capital
Stock:
(1) Which such person or any of its Affiliates or
Associates beneficially owns, directly or indirectly; or
(2) Which such person or any of its Affiliates or
Associates has (a) the right to acquire (whether such right is
exercisable immediately or only after the passage of time),
pursuant to any agreement, arrangement, or understanding or upon
the exercise of conversion rights, exchange rights, warrants, or
options, or otherwise, or (b) the right to vote pursuant to any
agreement, arrangement, or understanding; or
(3) Which are beneficially owned, directly or
indirectly, by any other person with which such person or any of
its Affiliates or Associates has any agreement, arrangement, or
understanding for the purpose of acquiring, holding, voting, or
disposing of any shares of Voting Stock. For the purposes of
determining whether a person is an Interested Stockholder
pursuant to paragraph (d) of this Article, the number of shares
of Capital Stock deemed to be outstanding shall include shares
deemed beneficially owned by such person through application of
paragraph (e) of this Article but shall not include any other
shares of Capital Stock that may be issuable pursuant to any
agreement, arrangement, or understanding, or upon exercise of
conversion rights, warrants, or options, or otherwise.
(f) "Affiliate" or "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act of 1934,
as in effect on March 1, 1985 (the term "registrant" in said
Rule 12b-2 meaning, in this case, the corporation).
(g) "Subsidiary" means any company of which a majority of
any class of equity security is owned, directly or indirectly, by
the corporation; provided, however, for the purposes of the
definition of Interested Stockholder set forth in paragraph (d)
of this section, the term "Subsidiary" shall mean only a company
of which a majority of each class of equity security is
beneficially owned, directly or indirectly, by the corporation.
(h) "Continuing Director" means any member of the board
of directors of the corporation (the "Board") while such person
is a member of the Board, who is not an Affiliate or Associate or
representative of the Interested Stockholder and was a member of
the Board on March 1, 1985, or prior to the time that the
Interested Stockholder became an Interested Stockholder, and any
successor of a Continuing Director, while such successor is a
member of the Board, who is not an Affiliate or Associate or
representative of the Interested Stockholder and is recommended
to succeed the Continuing Director by a majority of Continuing
Directors then on the Board.
(i) "Fair Market Value" means: (a) in the case of stock,
the highest closing sale price during the 30-day period
immediately preceding the date in question of a share of such
stock on the Composite Tape for New York Stock Exchange-Listed
Stocks, or, if such stock is not quoted on the Composite Tape, on
the New York Stock Exchange, or, if such stock is not listed on
such Exchange, on the principal United States securities exchange
registered under the Securities Exchange Act of 1934 on which
such stock is listed, or, if such stock is not listed on any such
exchange, the highest closing bid quotation with respect to a
share of such stock during the 30-day period preceding the date
in question on the National Association of Securities Dealers,
Inc., Automated Quotations System or any system then in use, or
if no such quotations are available, the Fair Market Value on the
date in question of a share of such stock as determined by a
majority of the Continuing Directors in good faith; and (b) in
the case of property other than cash or stock, the Fair Market
Value of such property on the date in question as determined by a
majority of Continuing Directors then on the Board.
(j) In the event of any Business Combination in which the
corporation survives, the phrase "consideration other than cash
to be received" as used in paragraphs (b)(1) and (2) of
Section 12.2 of this Article shall include the shares of Common
Stock and/or the shares of any other class of outstanding Voting
Stock retained by the holders of such shares.
12.4 The board of directors of the corporation shall have the
power and duty to determine for the purposes of this
Article TWELFTH, on the basis of information known to them after
reasonable inquiry (a) whether a person is an Interested
Stockholder, (b) the number of shares of Voting Stock
beneficially owned by any person, (c) whether a person is an
Affiliate or Associate of another, (d) whether the requirements
of paragraph (b) of Section 12.2 have been met with respect to
any Business Combination, and (e) whether any sale, lease,
exchange, mortgage, pledge, transfer, or other disposition or
security arrangement, investment, loan, advance, guarantee,
agreement to purchase, agreement to pay, extension of credit,
joint venture participation, or other arrangement (in one
transaction or a series of transactions) with or for the benefit
of any Interested Stockholder or any Affiliate or Associate of
any Interested Stockholder involving any assets, securities, or
commitments of the corporation, any Subsidiary or any Interested
Stockholder or any Affiliate or Associate of any Interested
Stockholder has an aggregate Fair Market Value and/or involves
aggregate commitments of $40,000,000 or more or constitutes a
Substantial Part. Any such determination made in good faith
shall be binding and conclusive on all parties.
12.5 Nothing contained in this Article TWELFTH shall be
construed to relieve any Interested Stockholder from any
fiduciary obligation imposed by law.
12.6 Consideration for shares to be paid to any stockholder
pursuant to this Article TWELFTH shall be the minimum considera-
tion payable to the stockholder and shall not limit a stock-
holder's right under any provision of law or otherwise to receive
greater consideration for any shares of the corporation.
12.7 The fact that any Business Combination complies with the
provisions of Section 12.2 of this Article TWELFTH shall not be
construed to impose any fiduciary duty, obligation, or respon-
sibility on the Board, or any member thereof, to approve such
Business Combination or recommend its adoption or approval to the
stockholders of the corporation, nor shall such compliance limit,
prohibit, or otherwise restrict in any manner the Board, or any
member thereof, with respect to evaluations of or actions and
responses taken with respect to such Business Combination.
12.8 Notwithstanding any other provisions of this Certificate
of Incorporation or the bylaws of the corporation (and notwith-
standing the fact that a lesser percentage may be specified by
law, this Certificate of Incorporation or the bylaws of the
corporation), the affirmative vote of the holders of at least 80%
of the voting power of all the shares of the Voting Stock, voting
together as a single class, shall be required to alter, amend, or
adopt any provisions inconsistent with or repeal this Article
TWELFTH; provided, however, if such action has been proposed,
directly or indirectly, on behalf of an Interested Stockholder,
it must also be approved by the affirmative vote of a majority of
the voting power of all of the shares of Voting Stock held by
stockholders other than such Interested Stockholder, and further
provided that this Section 12.8 shall not apply to, and such 80%
vote shall not be required for, any amendment, repeal, or
adoption unanimously recommended by the Board, if all of such
directors are persons who would be eligible to serve as
Continuing Directors within the meaning of paragraph (h) of
Section 12.3 of this Article TWELFTH.
THIRTEENTH:
13.1 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 director as a director.
Notwithstanding the foregoing sentence, a director shall be
liable to the extent provided by applicable law (i) for breach of
the director's duty of loyalty to the corporation or its stock-
holders, (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 Delaware General Corporation
Law, or (iv) for any transaction from which the director derived
an improper personal benefit. No amendment to or repeal of this
Article 13.1 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 prior to such amendment or
repeal.
13.2 The corporation shall indemnity, to the fullest extent
authorized or permitted and in the manner provided by law, any
person made, or threatened to be made, a party to any action,
suit, or proceeding (whether civil, criminal, or otherwise) by
reason of the fact that he or she, his or her testator or
intestate, is or was a director or officer of the corporation or
by reason of the fact that such director or officer, at the
request of the corporation, is or was serving any other corpora-
tion, partnership, joint venture, trust, employee benefit plan,
or other enterprise, in any capacity. Nothing contained herein
shall affect any rights to indemnification to which employees and
agents other than directors and officers may be entitled by law,
and the corporation may indemnify such employees and agents to
the fullest extent and in the manner permitted by law. The
rights to indemnification set forth in this Section 13.2 shall
not be exclusive of any other rights to which any person may be
entitled under any statute, provision of this Certificate of
Incorporation, bylaw, agreement, contract, vote of stockholders
or disinterested directors, or otherwise. The corporation also
is authorized to enter into contracts of indemnification.
FOURTEENTH: The corporation reserves the right to amend,
alter, change, or repeal any provision contained in this
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.
IN WITNESS WHEREOF, said BOISE CASCADE CORPORATION has caused
its corporate seal to be hereunto affixed and this Restated
Certificate of Incorporation to be signed by its Vice President
and General Counsel this April 19, 1996.
BOISE CASCADE CORPORATION
By /s/ J. W. Holleran
J. W. Holleran
Vice President and General
Counsel
ANNEX I
CERTIFICATE OF DESIGNATION
OF
CONVERTIBLE PREFERRED STOCK, SERIES D
OF
BOISE CASCADE CORPORATION
Pursuant to Section 151 of the
General Corporation Law
of the State of Delaware
The undersigned, Senior Vice President and Assistant
Secretary, respectively, of Boise Cascade Corporation, a Delaware
corporation (the "Company"), certify that pursuant to authority
granted to and vested in the Board of Directors (the "Board of
Directors") of the Company by the provisions of the Restated
Certificate of Incorporation of the Company, the Board of
Directors has adopted the following resolution creating a series
of Preferred Stock of the Company designated as the Convertible
Preferred Stock, Series D:
RESOLVED, by the Board of Directors of Boise Cascade
Corporation, a Delaware corporation (the "Company"), that,
pursuant to the authority expressly granted to and vested in the
Board of Directors by the provisions of the Restated Certificate
of Incorporation of the Company, the Board of Directors hereby
creates a fourth series of the class of authorized Preferred
Stock, without par value, of the Company consisting of
6,745,347 shares of Preferred Stock (such series being herein-
after sometimes called the "Series D Preferred Stock") with a
stated capital of $.01 per share, and authorizes the issuance
thereof, and hereby fixes the designation and amount thereof and
the voting powers, preferences and relative, participating,
optional, and other special rights of the shares of such series,
and the qualifications, limitations, or restrictions thereof (in
addition to the designations, preferences and relative,
participating, and other special rights, and the qualifications,
limitations, or restrictions thereof, set forth in the Restated
Certificate of Incorporation of the Company, which are applicable
to the Preferred Stock of all series) as follows:
Section 1. Designation and Amount; Special Purpose Restricted
Transfer Issue.
(A) The shares of such series shall be designated
"Convertible Preferred Stock, Series D" and the number of shares
constituting such series shall initially be 6,745,347.
(B) Shares of Series D Preferred Stock shall be issued only
to State Street Bank and Trust Company, as trustee, or any
successor trustee (the "Trustee") of the Savings and Supplemental
Retirement Plan of the Company, as amended from time to time, or
any successor or replacement plan (the "Plan"). In the event of
any transfer of shares of Series D Preferred Stock to any person
other than the Trustee, the shares of Series D Preferred Stock so
transferred, upon such transfer and without any further action by
the Company or the holder thereof, shall be automatically con-
verted into shares of Common Stock (as defined in paragraph (B)
of Section 11 hereof) on the terms otherwise provided for the
conversion of shares of Series D Preferred Stock into shares of
Common Stock pursuant to Section 5 hereof and no such transferee
shall have any of the voting powers, preferences and relative,
participating, optional, or special rights ascribed to shares of
Series D Preferred Stock hereunder but, rather, only the powers
and rights pertaining to the Common Stock into which such shares
of Series D Preferred Stock shall be so converted. In the event
of such a conversion, the transferee of the shares of Series D
Preferred Stock shall be treated for all purposes as the record
holder of the shares of Common Stock into which such shares of
Series D Preferred Stock have been automatically converted as of
the date of such transfer. Certificates representing shares of
Series D Preferred Stock shall bear a legend to reflect the
foregoing provisions. Notwithstanding the foregoing provisions
of this paragraph (B) of Section 1, shares of Series D Preferred
Stock (i) may be converted into shares of Common Stock as
provided by Section 5 hereof and the shares of Common Stock
issued upon such conversion may be transferred by the holder
thereof as permitted by law and (ii) shall be redeemable by the
Company upon the terms and conditions provided by Sections 6, 7,
and 8 hereof.
Section 2. Dividends and Distributions.
Subject to the provisions for adjustment hereinafter set
forth, the holders of shares of Series D Preferred Stock shall be
entitled to receive, when, as, and if declared by the Board of
Directors out of funds legally available therefor, cash dividends
("Preferred Dividends") at the rate of $3.31875 per share per
annum, payable semiannually, one-half on the 28th day of June and
one-half on the 28th day of December of each year (each a
"Dividend Payment Date") commencing on December 28, 1989, to
holders of record on the tenth Business Day (as defined in para-
graph (G) of Section 9 hereof) preceding such Dividend Payment
Date (the "Dividend Record Date"). In the event that any
Dividend Payment Date shall fall on any day other than a Business
Day, the dividend payment due on such Dividend Payment Date shall
be paid on the Business Day immediately following such Dividend
Payment Date. Preferred Dividends shall begin to accrue on
outstanding shares of Series D Preferred Stock from July 1, 1989.
Preferred Dividends shall accrue on a daily basis whether or not
during such semiannual period there shall be funds legally avail-
able therefor, but Preferred Dividends accrued on the shares of
Series D Preferred Stock for any period less than a full semi-
annual period between Dividend Payment Dates (or, in the case of
the first dividend payment, from the date of issuance of the
shares of Series D Preferred Stock through the first Dividend
Payment Date) shall be computed on the basis of a 360-day year of
30-day months. 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.
Section 3. Voting Rights.
The holders of shares of Series D Preferred Stock shall have
the following voting rights:
The holders of shares of Series D Preferred Stock shall be
entitled to vote on all matters submitted to a vote of the
stockholders of the Company, voting together with the holders of
Common Stock as one class. The holder of each share of Series D
Preferred Stock shall be entitled to one vote for each share of
Series D Preferred Stock held by such holder, provided, however,
that the number of votes per share of Series D Preferred Stock
shall not exceed the highest vote then permitted by applicable
rules and regulations of the Securities and Exchange Commission
or the New York Stock Exchange; it being understood that whenever
the "Conversion Price" (as defined in Section 5 hereof) is
adjusted as provided in Section 9 hereof, the number of votes per
share of Series D Preferred Stock shall also be similarly
adjusted. Notwithstanding the foregoing, no adjustment in the
number of votes per share of Series D Preferred Stock shall be
made to the extent that such adjustment will result in voting
rights per share of Series D Preferred Stock which would not be
permitted by the Restated Certificate of Incorporation of the
Company as then in effect or by applicable rules and regulations
of the Securities and Exchange Commission or the New York Stock
Exchange. In the event that the number of votes per share of
Series D Preferred Stock is not adjusted upon an adjustment to
the Conversion Price in accordance with the immediately preceding
sentence, then the Board of Directors of the Company shall
promptly take such action as may be necessary to equitably adjust
for such adjustment to the Conversion Price, including without
limitation, subdividing outstanding shares of Series D Preferred
Stock to the extent the Company has authorized shares of Series D
Preferred Stock which are not then outstanding, or designating
and issuing additional shares of Series D Preferred Stock to the
extent the Company has authorized shares of Preferred Stock which
are not then outstanding and are undesignated as to series;
provided, however, no such action on the part of the Board of
Directors shall adjust or change the aggregate economic terms
assigned to the outstanding shares of Series D Preferred Shares;
provided, further, no such action shall be taken which would
result in a violation of the applicable rules and regulations of
the Securities and Exchange Commission or the New York Stock
Exchange.
Section 4. Liquidation, Dissolution, or Winding Up.
(A) In the event of any liquidation, dissolution, or winding
up of the Company, voluntary or involuntary, the holders of
Series D Preferred Stock shall be entitled to receive out of the
assets of the Company which remain after satisfaction in full of
all valid claims of creditors of the Company and which are
available for payment to stockholders, liquidating distributions
in the amount of $45.00 per share, plus an amount equal to all
accrued and unpaid dividends thereon to the date fixed for
distribution. After payment of the full amount to which they are
entitled as provided by the foregoing provisions of this
paragraph 4(A), the holders of Series D Preferred Stock shall not
be entitled to any further right or claim to any of the remaining
assets of the Company.
(B) Neither the merger or consolidation of the Company with
or into any other corporation, nor the merger or consolidation of
any other corporation with or into the Company, nor the sale,
lease, exchange, or other transfer of all or substantially all of
the assets of the Company, shall be deemed to be a dissolution,
liquidation, or winding up of the affairs of the Company for
purposes of this Section 4, but the holders of Series D Preferred
Stock shall nevertheless be entitled in the event of any such
merger or consolidation to the rights provided by Section 8
hereof.
(C) Written notice of any voluntary or involuntary
liquidation, dissolution, or winding up of the Company, stating
the payment date or dates when, and the place or places where,
the amounts distributable to holders of Series D Preferred Stock
in such circumstances shall be payable, shall be given by hand
delivery, by courier, by standard form of telecommunication, or
by first-class mail (postage prepaid), delivered, sent, or
mailed, as the case may be, not less than twenty (20) days prior
to any payment date stated therein, to the holders of Series D
Preferred Stock, at the address shown on the books of the Company
or any transfer agent for the Series D Preferred Stock.
Section 5. Conversion into Common Stock.
(A) A holder of shares of Series D Preferred Stock shall be
entitled, at any time prior to the close of business on the date
fixed for redemption of such shares pursuant to Section 6, 7, or
8 hereof, to cause any or all of such shares to be converted into
shares of Common Stock, initially at a conversion price equal to
$56.00 per share of Common Stock, with each share of Series D
Preferred Stock being valued at $45.00 for such purpose, and
which price shall be adjusted as hereinafter provided (and, as so
adjusted, is hereinafter sometimes referred to as the "Conversion
Price") (that is, a conversion rate initially equivalent to
0.80357 shares of Common Stock for each share of Series D
Preferred Stock so converted, which is subject to adjustment as
the Conversion Price is adjusted as hereinafter provided in
Section 9); provided, however, that in no event shall the
Conversion Price be lower than the par value, if any, of the
Common Stock.
(B) Any holder of shares of Series D Preferred Stock
desiring to convert such shares into shares of Common Stock shall
surrender the certificate or certificates representing the shares
of Series D Preferred Stock being converted, duly assigned or
endorsed for transfer to the Company (or accompanied by duly
executed stock powers relating thereto), at the principal
executive office of the Company or the offices of the transfer
agent for the Series D Preferred Stock or such office or offices
in the continental United States of an agent for conversion as
may from time to time be designated by notice to the holders of
the Series D Preferred Stock by the Company or the transfer agent
for the Series D Preferred Stock, accompanied by written notice
of conversion. Such notice of conversion shall specify (i) the
number of shares of Series D Preferred Stock to be converted and
the name or names in which such holder wishes the certificate or
certificates for Common Stock and for any shares of Series D
Preferred Stock not to be so converted to be issued and (ii) the
address to which such holder wishes new certificates issued upon
such conversion to be delivered.
(C) Upon surrender of a certificate representing a share or
shares of Series D Preferred Stock for conversion, the Company
shall issue and send by hand delivery, by courier, or by first-
class mail (postage prepaid), to the holder thereof or to such
holder's designee, at the address designated by such holder, a
certificate or certificates for the number of shares of Common
Stock to which such holder shall be entitled upon conversion. In
the event that there shall have been surrendered a certificate or
certificates representing shares of Series D Preferred Stock,
only part of which are to be converted, the Company shall issue
and send to such holder or such holder's designee, in the manner
set forth in the preceding sentence, a new certificate or
certificates representing the number of shares of Series D
Preferred Stock which shall not have been converted.
(D) The issuance by the Company of shares of Common Stock
upon a conversion of shares of Series D Preferred Stock into
shares of Common Stock made at the option of the holder thereof
shall be effective as of the earlier of (i) the delivery to such
holder or such holder's designee of the certificates representing
the shares of Common Stock issued upon conversion thereof or
(ii) the commencement of business on the second Business Day
after the surrender of the certificate or certificates for the
shares of Series D Preferred Stock to be converted, duly assigned
or endorsed for transfer to the Company (or accompanied by duly
executed stock powers relating thereto) and accompanied by all
documentation required to effect the conversion, as herein
provided. On and after the effective date of conversion, the
person or persons entitled to receive the Common Stock issuable
upon such conversion shall be treated for all purposes as the
record holder or holders of such shares of Common Stock, but no
allowance or adjustment shall be made in respect of dividends
payable to holders of record of Common Stock as of any period
prior to such effective date. The Company shall not be obligated
to pay any dividends which shall have been declared and shall be
payable to holders of shares of Series D Preferred Stock on a
Dividend Payment Date if the Dividend Record Date for such
dividend is subsequent to the effective date of conversion of
such shares.
(E) The Company shall not be obligated to deliver to holders
of Series D Preferred Stock any fractional share of shares of
Common Stock issuable upon any conversion of such shares of
Series D Preferred Stock, but in lieu thereof may make a cash
payment in respect thereof in any manner permitted by law.
(F) The Company shall at all times reserve and keep
available out of its authorized and unissued Common Stock, solely
for issuance upon the conversion of shares of Series D Preferred
Stock as herein provided, free from any preemptive rights, such
number of shares of Common Stock as shall from time to time be
issuable upon the conversion of all the shares of Series D
Preferred Stock then outstanding. Nothing contained herein shall
preclude the Company from issuing shares of Common Stock held in
its treasury upon the conversion of shares of Series D Preferred
Stock into Common Stock pursuant to the terms hereof. The
Company shall prepare and shall use its best efforts to obtain
and keep in force such governmental or regulatory permits or
other authorizations as may be required by law, and shall comply
with all requirements as to registration or qualification of the
Common Stock, in order to enable the Company lawfully to issue
and deliver to each holder of record of Series D Preferred Stock
such number of shares of its Common Stock as shall from time to
time be sufficient to effect the conversion of all shares of
Series D Preferred Stock then outstanding and convertible into
shares of Common Stock.
Section 6. Redemption At the Option of the Company.
(A) The Series D Preferred Stock shall be redeemable (i) in
whole or in part, at the option of the Company at any time after
June 28, 1993, or (ii) at any time after the date of issuance as
provided by paragraph (E) of this Section 6, at the following
redemption prices per share:
During the Twelve-Month
Period Beginning June 28, 1989 Price Per Share
1989 $48.31875
1990 47.98688
1991 47.65500
1992 47.32313
1993 46.99125
1994 46.65938
1995 46.32750
1996 45.99563
1997 45.66375
1998 45.33188
and thereafter at $45.00 per share, plus, in each case, an amount
equal to all accrued and unpaid dividends thereon to the date fixed
for redemption. Payment of the redemption price shall be made by
the Company in cash or shares of Common Stock, or a combination
thereof, as permitted by paragraph (G) of this Section 6. From and
after the date fixed for redemption, dividends on shares of
Series D Preferred Stock called for redemption will cease to
accrue, such shares of Series D Preferred Stock will no longer be
deemed to be outstanding and all rights in respect of such shares
of Series D Preferred Stock shall cease, except the right to
receive the redemption price. If less than all of the outstanding
shares of Series D Preferred Stock are to be redeemed, the Company
shall either redeem a portion of the shares of Series D Preferred
Stock of each holder determined pro rata based on the number of
shares of Series D Preferred Stock held by each holder or shall
select the shares of Series D Preferred Stock to be redeemed by
lot, as may be determined by the Board of Directors of the Company.
(B) Unless otherwise required by law, notice of redemption
will be sent to the holders of Series D Preferred Stock at the
address shown on the books of the Company by first-class mail
(postage prepaid), mailed not less than fifteen (15) days nor more
than sixty (60) days prior to the redemption date. Each such
notice shall state: (i) the redemption date; (ii) the total number
of shares of Series D Preferred Stock to be redeemed and, if fewer
than all the shares held by such holder are to be redeemed, the
number of such shares of Series D Preferred Stock to be redeemed
from such holder; (iii) the redemption price; (iv) the place or
places where certificates for such shares of Series D Preferred
Stock are to be surrendered for payment of the redemption price;
(v) that dividends on the shares of Series D Preferred Stock to be
redeemed will cease to accrue on such redemption date; and (vi) the
conversion rights of the shares of Series D Preferred Stock to be
redeemed, the period within which conversion rights may be
exercised, and the Conversion Price and number of shares of Common
Stock issuable upon conversion of a share of Series D Preferred
Stock at the time. Upon surrender of the certificate for any
shares of Series D Preferred Stock so called for redemption and not
previously converted (properly endorsed or assigned for transfer,
if the Board of Directors of the Company shall so require and the
notice shall so state), such shares shall be redeemed by the
Company at the date fixed for redemption and at the redemption
price set forth in this Section 6.
(C) (i) Within thirty (30) days after the later of (a) the
effective date or (b) the enactment date of a change in any
statute, rule, or regulation of the United States of America which
has the effect of limiting or making unavailable to the Company all
or any of the tax deductions for amounts paid (including dividends)
on the shares of Series D Preferred Stock when such amounts are
used as provided under Section 404(k)(2) of the Internal Revenue
Code of 1986, as amended and in effect on the date shares of
Series D Preferred Stock are initially issued, or (ii) if the
Company, in good faith after consultation with counsel to the
Company, determines that the voting provisions contained herein are
not in compliance with Rule 19c-4 promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), the Company may, in its sole discre-
tion and notwithstanding anything to the contrary in paragraph (A)
of this Section 6, elect to redeem any or all of such shares of
Series D Preferred Stock for the amount payable in respect of such
shares upon liquidation of the Company pursuant to Section 4
hereof.
(D) In the event that shares of Series D Preferred Stock are
held by an employee benefit plan intended to qualify as an employee
stock ownership plan within the meaning of Section 4975 of the
Internal Revenue Code of 1986, as amended, and such plan does not
so qualify, the Company may in its sole discretion and notwith-
standing anything to the contrary in paragraph (A) of this
Section 6, elect to redeem any or all of such shares of Series D
Preferred Stock at a redemption price equal to the higher of
(i) the amount payable in respect of the shares of Series D
Preferred Stock being redeemed upon liquidation of the Company
pursuant to Section 4 hereof and (ii) the Fair Market Value (as
defined in paragraph (G) of Section 9 hereof) of the shares of
Common Stock which would be issuable upon the conversion of the
shares of Series D Preferred Stock being redeemed, plus accrued and
unpaid dividends on such shares of Series D Preferred Stock (the
"Consideration Price").
(E) In the event that the Plan is terminated or the employee
stock ownership plan component of the Plan pursuant to which the
shares of Series D Preferred Stock are then held by the Trustee is
eliminated from the Plan in accordance with its terms, and notwith-
standing anything to the contrary in paragraph (A) of this
Section 6, the Company shall, as soon thereafter as practicable,
call for redemption on the terms and conditions set forth in
paragraphs (A) and (B) of this Section 6 all then outstanding
shares of Series D Preferred Stock.
(F) Notwithstanding anything to the contrary in paragraph (A)
of this Section 6, upon the termination of a plan participant's
employment with the Company, the Company may elect to redeem any or
all shares of Series D Preferred Stock held for the account of such
participant at a redemption price equal to the higher of (i) the
amount payable in respect of the shares of Series D Preferred Stock
being redeemed upon liquidation of the Company pursuant to
Section 4 hereof and (ii) the Consideration Price.
(G) The Company, at its option, may make payment of the
redemption price required by this Section 6 or Section 7 upon
redemption of shares of Series D Preferred Stock in cash or in
shares of Common Stock, or in a combination of such shares and
cash, any such shares of Common Stock to be valued for such
purposes at their Fair Market Value.
Section 7. Other Redemption Rights.
(A) At any time and from time to time upon notice to the
Company given not less than five (5) Business Days prior to the
date fixed by the holder in such notice for the redemption of
shares of Series D Preferred Stock in accordance with the
provisions of this subsection, upon certification by such holder to
the Company that the holder must provide for distributions to
participants under, or must satisfy an investment election provided
to participants in accordance with, the Plan, then shares of
Series D Preferred Stock shall be redeemed by the Company to the
extent necessary for the holder to provide for such distributions
or to satisfy such investment elections, at a redemption price
equal to the higher of (i) the amount payable in respect of the
Series D Preferred Stock being redeemed upon liquidation of the
Company pursuant to Section 4 hereof and (ii) the Consideration
Price.
(B) Subject to the immediately following sentence, in the
event that the Plan is not initially determined by the Internal
Revenue Service to be qualified within the meaning of
Section 401(a) or that the portion of the Plan which is intended to
be an employee stock ownership plan is not initially determined to
be an employee stock ownership plan within the meaning of
Section 4975(e)(7) of the Internal Revenue Code of 1986, as
amended, then, upon notice to the Company given not less than five
(5) Business Days prior to the date fixed by the holder in such
notice for the redemption (hereinafter described), at the option of
the holder, shares of Series D Preferred Stock shall be redeemed by
the Company at a redemption price equal to the higher of (i) the
amount payable in respect of the Series D Preferred Stock being
redeemed upon liquidation of the Company pursuant to Section 4
hereof and (ii) the Consideration Price. If such unfavorable
determination would result solely from the rights otherwise given
the holder by the immediately preceding sentence, such sentence
shall have no force and effect and shall not give the holder any
such rights.
Section 8. Consolidation, Merger, Etc.
(A) In the event that the Company shall consummate any
consolidation or merger or similar business combination, pursuant
to which the outstanding shares of Common Stock are by operation of
law exchanged solely for or changed, reclassified, or converted
solely into stock of any successor or resulting corporation
(including the Company) that constitutes "qualifying employer
securities" with respect to a holder of Series D Preferred Stock
within the meaning of Section 409(l) of the Internal Revenue Code
of 1986, as amended, and Section 407(d)(5) of the Employee
Retirement Income Security Act of 1974, as amended, or any
successor provisions of law, and, if applicable, for a cash payment
in lieu of fractional shares, if any, the shares of Series D
Preferred Stock of such holder shall, in connection with such
consolidation, merger, or similar business combination, be assumed
by and shall become preferred stock of such successor or resulting
corporation, having in respect of such corporation, insofar as
possible, the same powers, preferences and relative, participating,
optional, or other special rights (including the redemption rights
provided by Sections 6, 7, and 8 hereof), and the qualifications,
limitations, or restrictions thereon, that the Series D Preferred
Stock had immediately prior to such transaction, except that after
such transaction each share of Series D Preferred Stock shall be
convertible, otherwise on the terms and conditions provided by
Section 5 hereof, into the number and kind of qualifying employer
securities so receivable by a holder of the number of shares of
Common Stock into which such shares of Series D Preferred Stock
could have been converted immediately prior to such transaction;
provided, however, that if by virtue of the structure of such
transaction, a holder of Common Stock is required to make an
election with respect to the nature and kind of consideration to be
received in such transaction, which election cannot practicably be
made by the holder of the shares of Series D Preferred Stock, then
the shares of Series D Preferred Stock shall, by virtue of such
transaction and on the same terms as apply to the holders of Common
Stock, be converted into or exchanged for the aggregate amount of
stock, securities, cash, or other property (payable in kind)
receivable by a holder of the number of shares of Common Stock into
which such shares of Series D Preferred Stock could have been
converted immediately prior to such transaction if such holder of
Common Stock failed to exercise any rights of election to receive
any kind or amount of stock, securities, cash, or other property
(other than such qualifying employer securities and a cash payment,
if applicable, in lieu of fractional shares) receivable upon such
transaction (however, if the kind or amount of qualifying employer
securities receivable upon such transaction is not the same for
each nonelecting share, then the kind and amount so receivable upon
such transaction for each nonelecting share shall be the kind and
amount so receivable per share by the plurality of the nonelecting
shares); and provided further that in the event the consideration
receivable by such a holder of Common Stock into which such shares
of Series D Preferred Stock could have been converted immediately
prior to such transaction if such holder of Common Stock failed to
exercise any such rights of election consists solely of such
qualifying employer securities and a cash payment, if applicable,
in lieu of fractional shares, then the shares of Preferred Stock
shall be assumed by and become preferred stock of the successor or
resulting corporation and shall be convertible after such transac-
tion, all as provided in the provisions of this paragraph (A) prior
to the first proviso hereof. The rights of the Series D Preferred
Stock as preferred stock of such successor or resulting corporation
shall successively be subject to adjustments pursuant to Sections 3
and 9 hereof after any such transaction as nearly equivalent as
practicable to the adjustment provided for by such sections prior
to such transaction. The Company shall not consummate any such
merger, consolidation, or similar transaction unless all then
outstanding shares of Series D Preferred Stock shall be assumed and
authorized by the successor or resulting corporation as aforesaid.
(B) In the event that the Company shall consummate any
consolidation or merger or similar business combination, pursuant
to which the outstanding shares of Common Stock are by operation of
law exchanged for or changed, reclassified, or converted into other
stock or securities or cash or any other property, or any combina-
tion thereof, other than any such consideration which is
constituted solely of qualifying employer securities (as referred
to in paragraph (A) of this Section 8) and cash payments, if
applicable, in lieu of fractional shares, outstanding shares of
Series D Preferred Stock shall, without any action on the part of
the Company or any holder thereof (but subject to paragraph (C) of
this Section 8), be automatically converted by virtue of such
merger, consolidation, or similar transaction immediately prior to
such consummation into the number of shares of Common Stock into
which such shares of Series D Preferred Stock could have been
converted at such time so that each share of Series D Preferred
Stock shall by virtue of such transaction and on the same terms as
apply to the holders of Common Stock, be converted into or
exchanged for the aggregate amount of stock, securities, cash, or
other property (payable in like kind) receivable by a holder of the
number of shares of Common Stock into which such shares of Series D
Preferred Stock could have been converted immediately prior to such
transaction; provided, however, that if by virtue of the structure
of such transaction, a holder of Common Stock is required to make
an election with respect to the nature and kind of consideration to
be received in such transaction, which election cannot practicably
be made by the holder of the shares of Series D Preferred Stock,
then the shares of Series D Preferred Stock shall, by virtue of
such transaction and on the same terms as apply to the holders of
Common Stock, be converted into or exchanged for the aggregate
amount of stock, securities, cash, or other property (payable in
kind) receivable by a holder of the number of shares of Common
Stock into which such shares of Series D Preferred Stock could have
been converted immediately prior to such transaction if such holder
of Common Stock failed to exercise any rights of election as to the
kind or amount of stock, securities, cash, or other property
receivable upon such transaction (provided that, if the kind or
amount of stock, securities, cash, or other property receivable
upon such transaction is not the same for each nonelecting share,
then the kind and amount of stock, securities, cash, or other
property receivable upon such transaction for each nonelecting
share shall be the kind and amount so receivable per share by a
plurality of the nonelecting shares).
(C) In the event the Company shall enter into any agreement
providing for any consolidation or merger or similar business
combination described in paragraph (B) of this Section 8 or in the
first proviso in paragraph (A) of this Section 8 to the extent that
shares of Series D Preferred Stock may be converted into or
exchanged for or changed, reclassified, or converted into stock or
securities or cash or other property, or any combination thereof,
other than any such consideration which is constituted solely of
qualifying employer securities and cash payments, if any, in lieu
of fractional shares, then the Company shall as soon as practicable
thereafter (and in any event at least ten (10) Business Days before
consummation of such transaction) give notice of such agreement and
the material terms thereof to each holder of shares of Series D
Preferred Stock and each such holder shall have the right to elect,
by written notice to the Company, to receive, upon consummation of
such transaction (if and when such transaction is consummated),
from the Company or the successor of the Company, in redemption and
retirement of such Series D Preferred Stock, a cash payment equal
to the higher of (i) the amount payable in respect of the shares of
Series D Preferred Stock being redeemed upon liquidation of the
Company pursuant to Section 4 hereof and (ii) the Consideration
Price. No such notice of redemption shall be effective unless
given to the Company prior to the close of business on the fifth
Business Day prior to consummation of such transaction, unless the
Company or the successor of the Company shall waive such prior
notice, but any notice of redemption so given prior to such time
may be withdrawn by notice of withdrawal given to the Company prior
to the close of business on the fifth Business Day prior to
consummation of such transaction.
Section 9. Antidilution Adjustments.
(A) In the event the Company shall, at any time or from time
to time while any of the shares of Series D Preferred Stock are
outstanding, (i) pay a dividend or make a distribution in respect
of the Common Stock in shares of Common Stock, (ii) subdivide the
outstanding shares of Common Stock, or (iii) combine the
outstanding shares of Common Stock into a smaller number of shares,
in each case whether by reclassification of shares, recapitaliza-
tion of the Company (including a recapitalization effected by a
merger or consolidation to which Section 8 hereof does not apply)
or otherwise, subject to paragraphs (E) and (F) of this Section 9,
the Conversion Price in effect immediately prior to such action
shall be adjusted by multiplying such Conversion Price by a
fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately before such event, and the
denominator of which is the number of shares of Common Stock out-
standing immediately after such event. An adjustment made pursuant
to this paragraph 9(A) shall be given effect, upon payment of such
a dividend or distribution, as of the record date for the deter-
mination of stockholders entitled to receive such dividend or
distribution (on a retroactive basis) and in the case of a
subdivision or combination shall become effective immediately as of
the effective date thereof.
(B) In the event that the Company shall, at any time or from
time to time while any of the shares of Series D Preferred Stock
are outstanding, issue to holders of shares of Common Stock as a
dividend or distribution, including by way of a reclassification of
shares or a recapitalization of the Company, any right or warrant
to purchase shares of Common Stock (but not including as such a
right or warrant any security convertible into or exchangeable for
shares of Common Stock) at a purchase price per share less than the
Fair Market Value of a share of Common Stock on the date of
issuance of such right or warrant, then, subject to paragraphs (E)
and (F) of this Section 9, the Conversion Price shall be adjusted
by multiplying such Conversion Price by a fraction, the numerator
of which shall be the number of shares of Common Stock outstanding
immediately before such issuance of rights or warrants plus the
number of shares of Common Stock which could be purchased at the
Fair Market Value of a share of Common Stock at the time of such
issuance for the maximum aggregate consideration payable upon
exercise in full of all such rights or warrants and the denominator
of which shall be the number of shares of Common Stock outstanding
immediately before such issuance of rights or warrants plus the
maximum number of shares of Common Stock that could be acquired
upon exercise in full of all such rights and warrants.
(C) In the event the Company shall, at any time or from time
to time while any of the shares of Series D Preferred Stock are
outstanding, issue, sell, or exchange shares of Common Stock (other
than pursuant to any right or warrant to purchase or acquire shares
of Common Stock (including as such a right or warrant any security
convertible into or exchangeable for shares of Common Stock) and
other than pursuant to any employee or director incentive or
benefit plan or arrangement, including any employment, severance,
or consulting agreement, of the Company or any subsidiary of the
Company heretofore or hereafter adopted) for a consideration having
a Fair Market Value, on the date of such issuance, sale, or
exchange, less than the Fair Market Value of such shares on the
date of issuance, sale, or exchange, then, subject to
paragraphs (E) and (F) of this Section 9, the Conversion Price
shall be adjusted by multiplying such Conversion Price by the
fraction the numerator of which shall be the sum of (i) the Fair
Market Value of all the shares of Common Stock outstanding on the
day immediately preceding the first public announcement of such
issuance, sale, or exchange plus (ii) the Fair Market Value of the
consideration received by the Company in respect of such issuance,
sale, or exchange of shares of Common Stock, and the denominator of
which shall be the product of (a) the Fair Market Value of a share
of Common Stock on the day immediately preceding the first public
announcement of such issuance, sale, or exchange multiplied by
(b) the sum of the number of shares of Common Stock outstanding on
such day plus the number of shares of Common Stock so issued, sold,
or exchanged by the Company. In the event the Company shall, at
any time or from time to time while any shares of Series D
Preferred Stock are outstanding, issue, sell, or exchange any right
or warrant to purchase or acquire shares of Common Stock (including
as such a right or warrant any security issued after the date
hereof which is convertible into or exchangeable for shares of
Common Stock), other than any such issuance to holders of shares of
Common Stock as a dividend or distribution (including by way of a
reclassification of shares or a recapitalization of the Company)
and other than pursuant to any employee or director incentive or
benefit plan or arrangement (including any employment, severance,
or consulting agreement) of the Company or any subsidiary of the
Company heretofore or hereafter adopted, for a consideration having
a Fair Market Value, on the date of such issuance, sale, or
exchange, less than the Nondilutive Amount (as hereinafter
defined), then, subject to paragraphs (E) and (F) of this
Section 9, the Conversion Price shall be adjusted by multiplying
such Conversion Price by a fraction the numerator of which shall be
the sum of (I) the Fair Market Value of all the shares of Common
Stock outstanding on the day immediately preceding the first public
announcement of such issuance, sale, or exchange plus (II) the Fair
Market Value of the consideration received by the Company in
respect of such issuance, sale, or exchange of such right or
warrant plus (III) the Fair Market Value at the time of such
issuance of the consideration which the Company would receive upon
exercise in full of all such rights or warrants, and the
denominator of which shall be the product of (i) the Fair Market
Value of a share of Common Stock on the day immediately preceding
the first public announcement of such issuance, sale, or exchange
multiplied by (ii) the sum of the number of shares of Common Stock
outstanding on such day plus the maximum number of shares of Common
Stock which could be acquired pursuant to such right or warrant at
the time of the issuance, sale, or exchange of such right or
warrant (assuming shares of Common Stock could be acquired pursuant
to such right or warrant at such time).
(D) In the event the Company shall, at any time or from time
to time while any of the shares of Series D Preferred Stock are
outstanding, make an Extraordinary Distribution (as hereinafter
defined) in respect of the Common Stock, whether by dividend,
distribution, reclassification of shares, or recapitalization of
the Company (including a recapitalization or reclassification
effected by a merger or consolidation to which Section 8 hereof
does not apply) or effect a Pro Rata Repurchase (as hereinafter
defined) of Common Stock, the Conversion Price in effect
immediately prior to such Extraordinary Distribution or Pro Rata
Repurchase shall, subject to paragraphs (E) and (F) of this
Section 9, be adjusted by multiplying such Conversion Price by the
fraction the numerator of which is the difference between (i) the
product of (x) the number of shares of Common Stock outstanding
immediately before such Extraordinary Distribution or Pro Rata
Repurchase multiplied by (y) the Fair Market Value of a share of
Common Stock on the day before the exdividend date with respect to
an Extraordinary Distribution which is paid in cash and on the
distribution date with respect to an Extraordinary Distribution
which is paid other than in cash, or on the applicable expiration
date (including all extensions thereof) of any tender offer which
is a Pro Rata Repurchase, or on the date of purchase with respect
to any Pro Rata Repurchase which is not a tender offer, as the case
may be, and (ii) the Fair Market Value of the Extraordinary
Distribution or the aggregate purchase price of the Pro Rata
Repurchase, as the case may be, and the denominator of which shall
be the product of (a) the number of shares of Common Stock out-
standing immediately before such Extraordinary Dividend or Pro Rata
Repurchase minus, in the case of a Pro Rata Repurchase, the number
of shares of Common Stock repurchased by the Company multiplied by
(b) the Fair Market Value of a share of Common Stock on the day
before the exdividend date with respect to an Extraordinary
Distribution which is paid in cash and on the distribution date
with respect to an Extraordinary Distribution which is paid other
than in cash, or on the applicable expiration date (including all
extensions thereof) of any tender offer which is a Pro Rata
Repurchase or on the date of purchase with respect to any Pro Rata
Repurchase which is not a tender offer, as the case may be. The
Company shall send each holder of Series D Preferred Stock
(i) notice of its intent to make any dividend or distribution and
(ii) notice of any offer by the Company to make a Pro Rata
Repurchase, in each case at the same time as, or as soon as
practicable after, such offer is first communicated (including by
announcement of a record date in accordance with the rules of any
stock exchange on which the Common Stock is listed or admitted to
trading) to holders of Common Stock. Such notice shall indicate
the intended record date and the amount and nature of such dividend
or distribution, or the number of shares subject to such offer for
a Pro Rata Repurchase and the purchase price payable by the Company
pursuant to such offer, as well as the Conversion Price and the
number of shares of Common Stock into which a share of Series D
Preferred Stock may be converted at such time.
(E) Notwithstanding any other provisions of this Section 9,
the Company shall not be required to make any adjustment to the
Conversion Price unless such adjustment would require an increase
or decrease of at least one percent (1%) in the Conversion Price.
Any lesser adjustment shall be carried forward and shall be made no
later than the time of, and together with, the next subsequent
adjustment which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at
least one percent (1%) in the Conversion Price.
(F) If the Company shall make any dividend or distribution on
the Common Stock or issue any Common Stock, other capital stock or
other security of the Company or any rights or warrants to purchase
or acquire any such security, which transaction does not result in
an adjustment to the Conversion Price pursuant to the foregoing
provisions of this Section 9, the Board of Directors of the Company
shall consider whether such action is of such a nature that an
adjustment to the Conversion Price should equitably be made in
respect of such transaction. If in such case the Board of
Directors of the Company determines that an adjustment to the
Conversion Price should be made, an adjustment shall be made
effective as of such date, as determined by the Board of Directors
of the Company. The determination of the Board of Directors of the
Company as to whether an adjustment to the Conversion Price should
be made pursuant to the foregoing provisions of this
paragraph 9(F), and, if so, as to what adjustment should be made
and when, shall be final and binding on the Company and all
stockholders of the Company. The Company shall be entitled to make
such additional adjustments in the Conversion Price, in addition to
those required by the foregoing provisions of this Section 9, as
shall be necessary in order that any dividend or distribution in
shares of capital stock of the Company, subdivision, reclassifica-
tion, or combination of shares of stock of the Company or any
recapitalization of the Company shall not be taxable to the holders
of the Common Stock.
(G) For purposes of this Resolution, the following definitions
shall apply:
"Adjustment Period" shall mean the period of five
(5) consecutive trading days preceding the date as of which the
Fair Market Value of a security is to be determined.
"Business Day" shall mean any day which is not a Saturday,
Sunday, or a bank holiday in New York, New York, or Los Angeles,
California.
"Current Market Price" of publicly traded shares of Common
Stock or any other class of capital stock or other security of the
Company or any other issuer for any day shall mean (i) for purposes
of Sections 6 and 7 hereof, the mean between the highest and lowest
reported sales price on such day and (ii) for all other purposes
hereof, the last reported sales price, regular way, or, in the
event that no sale takes place on such day, the average of the
reported closing bid and asked prices, regular way, in either case
as reported on the New York Stock Exchange Composite Tape or, if
such security is not listed or admitted to trading on the New York
Stock Exchange, on the principal national securities exchange on
which such security is listed or admitted to trading or, if not
listed or admitted to trading on any national securities exchange,
on the National Market System of the National Association of
Securities Dealers, Inc., Automated Quotation System ("NASDAQ") or,
if such security is not quoted on such National Market System, the
average of the closing bid and asked prices on each such day in the
over-the-counter market as reported by NASDAQ or, if bid and asked
prices for such security on each such day shall not have been
reported through NASDAQ, the average of the bid and asked prices
for such day as furnished by any New York Stock Exchange member
firm regularly making a market in such security selected for such
purpose by the Board of Directors of the Company or a committee
thereof, in each case, on each trading day during the Adjustment
Period.
"Extraordinary Distribution" shall mean any dividend or other
distribution to holders of Common Stock (effected while any of the
shares of the Series D Preferred Stock are outstanding) (i) of cash
(other than a regularly scheduled quarterly dividend not exceeding
125% of the average quarterly dividend for the preceding period of
12 months), where the aggregate amount of such cash dividend or
distribution together with the amount of all cash dividends and
distributions made during the preceding period of 12 months (other
than regularly scheduled quarterly dividends not exceeding 125% of
the aggregate quarterly dividends for the preceding period of
12 months), when combined with the aggregate amount of all Pro Rata
Repurchases (for this purpose, including only that portion of the
aggregate purchase price of such Pro Rata Repurchase which is in
excess of the Fair Market Value of the Common Stock repurchased as
determined on the applicable expiration date (including all
extensions thereof) of any tender offer or exchange offer which is
a Pro Rata Repurchase, or the date of purchase with respect to any
other Pro Rata Repurchase which is not a tender offer or exchange
offer made during such period), exceeds seven and one-half percent
(7.5%) of the aggregate Fair Market Value of all shares of Common
Stock outstanding on the day before the exdividend date with
respect to such Extraordinary Distribution which is paid in cash
and on the distribution date with respect to an Extraordinary
Distribution which is paid other than in cash, and/or (ii) of any
shares of capital stock of the Company (other than shares of Common
Stock), other securities of the Company (other than securities of
the type referred to in paragraph (B) or (C) of this Section 9),
evidences of indebtedness of the Company or any other person or any
other property (including shares of any subsidiary of the Company)
or any combination thereof. The Fair Market Value of an
Extraordinary Distribution for purposes of paragraph (D) of this
Section 9 shall be equal to the sum of the Fair Market Value of
such Extraordinary Distribution plus the amount of any cash
dividends (other than regularly scheduled quarterly dividends not
exceeding 125% of the aggregate quarterly dividends for the
preceding period of 12 months) which are not Extraordinary
Distributions made during such 12-month period and not previously
included in the calculation of an adjustment pursuant to
paragraph (D) of this Section 9.
"Fair Market Value" shall mean, as to shares of Common Stock
or any other class of capital stock or securities of the Company or
any other issuer which are publicly traded, (i) for purposes of
Sections 6 and 7 hereof, the Current Market Price on the date as of
which the Fair Market Value is to be determined, and (ii) for all
other purposes hereof, the average of the Current Market Prices of
such shares or securities for each day of the Adjustment Period.
The "Fair Market Value" of any security which is not publicly
traded (other than the Series D Preferred Stock) or of any other
property shall mean the fair value thereof as determined by an
independent investment banking or appraisal firm experienced in the
valuation of such securities or property selected in good faith by
the Board of Directors of the Company or a committee thereof, or,
if no such investment banking or appraisal firm is in the good
faith judgment of the Board of Directors or such committee
available to make such determination, as determined in good faith
by the Board of Directors of the Company or such committee.
"Nondilutive Amount" in respect of an issuance, sale, or
exchange by the Company of any right or warrant to purchase or
acquire shares of Common Stock (including any security convertible
into or exchangeable for shares of Common Stock) shall mean the
difference between (i) the product of the Fair Market Value of a
share of Common Stock on the day preceding the first public
announcement of such issuance, sale, or exchange multiplied by the
maximum number of shares of Common Stock which could be acquired on
such date upon the exercise in full of such rights and warrants
(including upon the conversion or exchange of all such convertible
or exchangeable securities), whether or not exercisable (or
convertible or exchangeable) at such date, and (ii) the aggregate
amount payable pursuant to such right or warrant to purchase or
acquire such maximum number of shares of Common Stock; provided,
however, that in no event shall the Nondilutive Amount be less than
zero. For purposes of the foregoing sentence, in the case of a
security convertible into or exchangeable for shares of Common
Stock, the amount payable pursuant to a right or warrant to
purchase or acquire shares of Common Stock shall be the Fair Market
Value of such security on the date of the issuance, sale, or
exchange of such security by the Company.
"Pro Rata Repurchase" shall mean any purchase of shares of
Common Stock by the Company or any subsidiary thereof, whether for
cash, shares of capital stock of the Company, other securities of
the Company, evidences of indebtedness of the Company, or any other
person or any other property (including shares of a subsidiary of
the Company), or any combination thereof, effected while any of the
shares of Series D Preferred Stock are outstanding, pursuant to any
tender offer or exchange offer subject to Section 13(e) of the
Exchange Act, or any successor provision of law, or pursuant to any
other offer available to substantially all holders of Common Stock,
other than any such purchase effected prior to December 31, 1989,
with the proceeds of the sale of the Series D Preferred Stock;
provided, however, that no purchase of shares by the Company or any
subsidiary thereof made in open market transactions shall be deemed
a Pro Rata Repurchase. For purposes of this paragraph (G) of this
Section 9, shares shall be deemed to have been purchased by the
Company or any subsidiary thereof "in open market transactions" if
they have been purchased substantially in accordance with the
requirements of Rule 10b-18 as in effect under the Exchange Act, on
the date shares of Series D Preferred Stock are initially issued by
the Company or on such other terms and conditions as the Board of
Directors of the Company or a committee thereof shall have
determined are reasonably designed to prevent such purchases from
having a material effect on the trading market for the Common
Stock.
(H) In the event that the Board of Directors of the Company
adjusts the number of outstanding shares of Series D Preferred
Stock in accordance with Section 3 hereof, then in lieu of any
other adjustment to the Conversion Price pursuant to this
Section 9, the Board of Directors of the Company may make such
other adjustments as they deem appropriate. The determination of
the Board of Directors of the Company as to whether an adjustment
should be made pursuant to the foregoing sentence of this
paragraph 9(H), and, if so, as to what adjustment should be made
and when, shall be final and binding on the Company and all
stockholders of the Company.
(I) Whenever an adjustment to the Conversion Price and the
related voting rights of the Series D Preferred Stock is required
pursuant to this Resolution, the Company shall forthwith place on
file with the transfer agent for the Common Stock and the Series D
Preferred Stock, and with the Secretary of the Company, a statement
signed by two officers of the Company stating the adjusted
Conversion Price determined as provided herein and the resulting
conversion ratio, and the voting rights (as appropriately
adjusted), of the Series D Preferred Stock. Such statement shall
set forth in reasonable detail such facts as shall be necessary to
show the reason and the manner of computing such adjustment,
including any determination of Fair Market Value involved in such
computation. Promptly after each adjustment to the Conversion
Price and the related voting rights of the shares of the Series D
Preferred Stock, the Company shall mail a notice thereof and of the
then prevailing conversion ratio to each holder of shares of
Series D Preferred Stock.
Section 10. Ranking; Attributable Capital And Adequacy of
Surplus; Retirement of Shares.
(A) The Series D Preferred Stock shall rank senior to the
Common Stock as to the payment of dividends and the distribution of
assets on liquidation, dissolution, and winding up of the Company.
(B) In addition to any vote of stockholders required by law,
the vote of the holders of a majority of the outstanding shares of
Series D Preferred Stock shall be required to increase the par
value of the Common Stock or otherwise increase the capital of the
Company allocable to the Common Stock for the purpose of the
Delaware General Corporation Law ("DGCL") if, as a result thereof,
the surplus of the Company for purposes of the DGCL would be less
than the amount of Preferred Dividends that would accrue on the
then outstanding shares of Series D Preferred Stock during the
following three years.
(C) Any shares of Series D Preferred Stock acquired by the
Company by reason of the conversion or redemption of such shares as
herein provided, or otherwise so acquired, shall be retired as
shares of Series D Preferred Stock and restored to the status of
authorized but unissued shares of Preferred Stock of the Company,
undesignated as to series, and may thereafter be reissued as part
of a new series of such Preferred Stock as permitted by law.
Section 11. Miscellaneous.
(A) All notices referred to herein shall be in writing, and
all notices hereunder shall be deemed to have been given upon the
earlier of delivery thereof if by hand delivery, by courier, or by
standard form of telecommunication or three (3) business days after
the mailing thereof if sent by registered mail (unless first-class
mail shall be specifically permitted for such notice under the
terms hereof) with postage prepaid, addressed: (i) if to the
Company, to its office at One Jefferson Square, Boise, Idaho 83728
(Attention: Senior Vice President and General Counsel), or to the
transfer agent for the Series D Preferred Stock, or other agent of
the Company designated as permitted hereby or (ii) if to any holder
of the Series D Preferred Stock or Common Stock, as the case may
be, to such holder at the address of such holder as listed in the
stock record books of the Company (which may include the records of
any transfer agent for the Series D Preferred Stock or Common
Stock, as the case may be) or (iii) to such other address as the
Company or any such holder, as the case may be, shall have
designated by notice similarly given.
(B) The term "Common Stock" as used in this Resolution means
the Company's Common Stock, $2.50 par value, as the same exists at
the date of filing of a Certificate of Designation relating to
Series D Preferred Stock or any other class of stock resulting from
successive changes or reclassifications of such Common Stock
consisting solely of changes in par value, or from par value to no
par value, or from no par value to par value. In the event that,
at any time as a result of an adjustment made pursuant to Section 9
hereof, the holder of any share of Series D Preferred Stock upon
thereafter surrendering such shares for conversion, shall become
entitled to receive any shares or other securities of the Company
other than shares of Common Stock, the Conversion Price in respect
of such other shares or securities so receivable upon conversion of
Series D Preferred Stock shall thereafter be adjusted, and shall be
subject to further adjustment from time to time, in a manner and on
terms as nearly equivalent as practicable to the provisions with
respect to Common Stock contained in Section 9 hereof, and the
provisions of Sections 1 through 8, 10, and 11 of this Resolution
with respect to the Common Stock shall apply on like or similar
terms to any such other shares or securities.
(C) The Company shall pay any and all stock transfer and
documentary stamp taxes that may be payable in respect of any
issuance or delivery of shares of Series D Preferred Stock or
shares of Common Stock or other securities issued on account of
Series D Preferred Stock pursuant hereto or certificates
representing such shares or securities. The Company shall not,
however, be required to pay any such tax which may be payable in
respect of any transfer involved in the issuance or delivery of
shares of Series D Preferred Stock or Common Stock or other
securities in a name other than that in which the shares of
Series D Preferred Stock with respect to which such shares or other
securities are issued or delivered were registered, or in respect
of any payment to any person with respect to any such shares or
securities other than a payment, to the registered holder thereof,
and shall not be required to make any such issuance, delivery, or
payment unless and until the person otherwise entitled to such
issuance, delivery, or payment has paid to the Company the amount
of any such tax or has established, to the satisfaction of the
Company, that such tax has been paid or is not payable.
(D) In the event that a holder of shares of Series D Preferred
Stock shall not by written notice designate the name in which
shares of Common Stock to be issued upon conversion of such shares
should be registered or to whom payment upon redemption of shares
of Series D Preferred Stock should be made or the address to which
the certificate or certificates representing such shares, or such
payment, should be sent, the Company shall be entitled to register
such shares, and make such payment, in the name of the holder of
such Series D Preferred Stock as shown on the records of the
Company and to send the certificate or certificates representing
such shares, or such payment, to the address of such holder shown
on the records of the Company.
(E) Unless otherwise provided in the Restated Certificate of
Incorporation, as the same may be amended, of the Company, all
payments in the form of dividends, distributions on voluntary or
involuntary dissolution, liquidation, or winding up or otherwise
made upon the Series D Preferred Stock and any other stock ranking
on a parity with the Series D Preferred Stock with respect to such
dividend or distribution shall be pro rata, so that amounts paid
per share of Series D Preferred Stock and such other stock shall in
all cases bear to each other the same ratio that the required
dividends, distributions, or payments, as the case may be, then
payable per share on the Series D Preferred Stock and such other
stock bear to each other.
(F) The Company may appoint, and from time to time discharge
and change, a transfer agent for the Series D Preferred Stock.
Upon any such appointment or discharge of a transfer agent, the
Company shall send notice thereof by hand delivery, by courier, by
standard form of telecommunication, or by first-class mail,
(postage prepaid), to each holder of record of Series D Preferred
Stock.
IN WITNESS WHEREOF, this certificate has been executed and
attested by the undersigned this 10th day of July, 1989.
/s/ J. E. Clute
Name: J. E. Clute
Title: Senior Vice President
ATTEST:
/s/ David G. Gadda
Name: David G. Gadda
Title: Assistant Secretary
ANNEX II
CERTIFICATE OF DESIGNATION
OF
9.40% CUMULATIVE PREFERRED STOCK, SERIES F
OF
BOISE CASCADE CORPORATION
Pursuant to Section 151 of the
General Corporation Law
of the State of Delaware
Boise Cascade Corporation, a Delaware corporation (the
"Corporation"), certifies that pursuant to authority granted to and
vested in the Board of Directors of the Corporation by the
provisions of the Corporation's Restated Certificate of
Incorporation, the Board of Directors of the Corporation has
adopted the following resolution creating a series of Preferred
Stock of the Corporation:
RESOLVED, by the Board of Directors (the "Board of Directors")
of Boise Cascade Corporation, a Delaware corporation (the
"Corporation"), that, pursuant to authority expressly granted to
and vested in the Board of Directors by the provisions of the
Corporation's Restated Certificate of Incorporation (the "Restated
Certificate of Incorporation"), the Board of Directors hereby
creates a sixth series of the class of authorized Preferred Stock,
without par value, of the Corporation, and authorizes the issuance
thereof, and hereby fixes the designation and amount thereof and
the voting powers, preferences and relative, participating,
optional, and other special rights of the shares of such series,
and the qualifications, limitations, or restrictions thereof (in
addition to the designation, preferences and relative,
participating, and other special rights, and the qualifications,
limitations, or restrictions thereof, set forth in the Restated
Certificate of Incorporation which are applicable to the Preferred
Stock of all series) as follows:
1. Designation and Amount. The shares of such series shall
be designated the "9.40% Cumulative Preferred Stock, Series F" and
the number of shares constituting such series shall be 115,000.
The shares of such series shall have a stated capital of $.01 per
share. Such series is herein sometimes referred to as the
"Series F Preferred Stock."
2. Dividends. The holders of the shares of Series F
Preferred Stock shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
therefor, cash dividends ("Preferred Dividends") at the rate of
$94.00 per share per annum, payable quarterly in arrears, one
quarter each on the 15th day of the months of January, April, July,
and October in each year (each a "Dividend Payment Date")
commencing on April 15, 1993. In the event that any Dividend
Payment Date shall fall on any day other than a business day (as
hereinafter defined), the Preferred Dividend due on such Dividend
Payment Date shall be paid on the business day immediately
following such Dividend Payment Date. Preferred Dividends shall
begin to accrue from the date of initial issuance of the Series F
Preferred Stock. Preferred Dividends shall accrue on a daily basis
whether or not in any such quarterly period there shall be funds of
the Corporation legally available therefor and whether or not such
Preferred Dividends are declared, but Preferred Dividends accrued
for any period less than a full quarterly period between Dividend
Payment Dates (or, in the case of the first Preferred Dividend,
from the date of initial issuance of the shares of Series F
Preferred Stock to the first Dividend Payment Date) shall be
computed on the basis of a 360-day year of twelve 30-day months.
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. As used herein, 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.
3. Optional Redemption. The shares of Series F Preferred
Stock are not redeemable by the Corporation prior to February 15,
1998. On and after February 15, 1998, the outstanding shares of
Series F Preferred Stock or any part thereof may be redeemed by the
Corporation, at its option expressed by resolution of the Board of
Directors, at any time or from time to time, at the redemption
price of $1,000 per share, plus an amount equal to any arrearages
in dividends thereon. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to
each holder of record of shares of Series F Preferred Stock to be
redeemed at the address shown on the books of the Corporation (but
no failure to mail such notice or any defect therein or in the
mailing thereof shall affect the validity of the proceedings for
such redemption except as to the holder to whom the Corporation has
failed to mail such notice or except as to the holder whose notice
was defective). On or after the redemption date fixed in such
notice, dividends shall cease to accumulate on shares of Series F
Preferred Stock called for redemption (unless the Corporation
defaults in the payment or deposit of the redemption price pursuant
to such notice).
4. Liquidation Rights. In the event of any liquidation or
dissolution or winding up of the Corporation, voluntary or
involuntary, the holders of the Series F Preferred Stock shall be
entitled to receive the sum of $1,000 per share, plus an amount
equal to any arrearages in dividends thereon.
5. Voting Rights. Except as set forth in the following
sentence of this paragraph 5, the holders of Series F Preferred
Stock shall have no voting rights. The holders of Series F
Preferred Stock shall have one vote per share on each of the
matters on which they are entitled to vote by applicable law, by
the provisions of Section 2.6 of the Restated Certificate of
Incorporation or by the provisions of Section 2.8 of the Restated
Certificate of Incorporation, which Section 2.8 shall be applicable
to the Series F Preferred Stock.
IN WITNESS WHEREOF, Boise Cascade Corporation has caused this
Certificate of Designation to be signed by John W. Holleran, its
Vice President and General Counsel, and attested by A. James
Balkins III, its Corporate Secretary, this 29th day of January,
1993.
BOISE CASCADE CORPORATION
By /s/ John W. Holleran
John W. Holleran
Vice President and General
Counsel
ATTEST:
By /s/ A. James Balkins III
A. James Balkins III
Corporate Secretary
ANNEX III
CERTIFICATE OF DESIGNATION
OF
CONVERSION PREFERRED STOCK, SERIES G
OF
BOISE CASCADE CORPORATION
Pursuant to Section 151 of the
General Corporation Law
of the State of Delaware
Boise Cascade Corporation, a Delaware corporation (the
"Corporation"), certifies that pursuant to authority granted to and
vested in the Board of Directors of the Corporation by the
provisions of the Corporation's Restated Certificate of
Incorporation, the Board of Directors of the Corporation has
adopted the following resolution creating a series of Preferred
Stock of the Corporation:
RESOLVED, by the Board of Directors (the "Board of
Directors") of Boise Cascade Corporation, a Delaware
corporation (the "Corporation"), that, pursuant to authority
expressly granted to and vested in the Board of Directors by
the provisions of the Corporation's Restated Certificate of
Incorporation (the "Restated Certificate of Incorporation"),
the Board of Directors hereby creates a seventh series of the
class of authorized Preferred Stock, without par value, of
the Corporation, and authorizes the issuance thereof, and
hereby fixes the designation and amount thereof and the
voting powers, preferences and relative, participating,
optional and other special rights of the shares of such
series, and the qualifications, limitations, or restrictions
thereof (in addition to the designation, preferences and
relative, participating, optional, and other special rights,
and the qualifications, limitations, or restrictions thereof,
set forth in the Restated Certificate of Incorporation which
are applicable to the Preferred Stock of all series) as
follows:
1. Designation and Amount. The shares of such series shall
be designated the "Conversion Preferred Stock, Series G" and the
number of shares constituting such series shall be 862,500. The
shares of such series shall have a stated capital of $.01 per
share. Such series is herein sometimes referred to as the
"Series G Preferred Stock."
2. Dividends. The holders of the shares of Series G
Preferred Stock shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
therefor, cash dividends ("Preferred Dividends") at the rate of
$15.80 per share per annum, payable quarterly in arrears, one
quarter each on the 15th day of the months of January, April, July,
and October in each year (each a "Dividend Payment Date") commenc-
ing on October 15, 1993. In the event that any Dividend Payment
Date shall fall on any day other than a business day (as herein-
after defined), the Preferred Dividend due on such Dividend Payment
Date shall be paid on the business day immediately following such
Dividend Payment Date. Preferred Dividends shall begin to accrue
from the date of initial issuance of the Series G Preferred Stock.
Preferred Dividends shall cease to accrue on shares of Series G
Preferred Stock on the Mandatory Conversion Date (as hereinafter
defined) or on the date of their earlier conversion or redemption.
Preferred Dividends shall accrue on a daily basis whether or not in
any such quarterly period there shall be funds of the Corporation
legally available therefor and whether or not such Preferred
Dividends are declared, but Preferred Dividends accrued for any
period less than a full quarterly period between Dividend Payment
Dates (or, in the case of the first Preferred Dividend, from the
date of initial issuance of the shares of Series G Preferred Stock
to the first Dividend Payment Date) shall be computed on the basis
of a 360-day year of twelve 30-day months. 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.
3. Conversion or Redemption.
(a) Automatic Conversion on the Mandatory Conversion Date.
Unless earlier either called for redemption in accordance with the
provisions of paragraph 3(b) or converted at the option of the
holder in accordance with the provisions of paragraph 3(c), on
October 15, 1997 (the "Mandatory Conversion Date"), each
outstanding share of Series G Preferred Stock shall convert
automatically (the "Automatic Conversion") into (i) shares of
authorized common stock, $2.50 par value, of the Corporation (the
"Common Stock") at the Common Equivalent Rate (as hereinafter
defined) in effect on the Mandatory Conversion Date and (ii) the
right to receive an amount in cash equal to all accrued and unpaid
Preferred Dividends on such share to the Mandatory Conversion Date,
whether or not earned or declared, out of funds legally available
therefor. The Common Equivalent Rate is initially ten shares of
Common Stock for each share of Series G Preferred Stock and is
subject to adjustment as set forth in paragraphs 3(d) and 3(e)
below. Preferred Dividends on the shares of Series G Preferred
Stock shall cease to accrue and such shares of Series G Preferred
Stock shall cease to be outstanding on 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,
if any, in exchange for and contingent upon surrender of
certificates representing the shares of Series G Preferred Stock,
and the Corporation may defer the 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 such
certificates representing the shares of Series G Preferred Stock,
provided that the Corporation shall give the holders of the shares
of Series G Preferred Stock such notice of any such actions as the
Corporation deems appropriate and upon such surrender such holders
shall be entitled to receive such dividends declared and paid on
such shares of Common Stock subsequent to the Mandatory Conversion
Date. Amounts payable in cash in respect of the shares of Series G
Preferred Stock or in respect of such shares of Common Stock shall
not bear interest.
(b) Redemption by the Corporation.
(i) Right to Call for Redemption. Shares of Series G
Preferred Stock are not redeemable by the Corporation prior to
July 15, 1997 (the "Initial Redemption Date"). At any time and
from time to time on or after the Initial Redemption Date and prior
to the Mandatory Conversion Date, the Corporation shall have the
right to call, in whole or in part, the outstanding shares of
Series G Preferred Stock for redemption (subject to the notice
provisions set forth in paragraph (3)(b)(iii) and to
section 2.6(a)(v) of the Restated Certificate of Incorporation).
Upon such call, each holder of shares of Series G Preferred Stock
to be redeemed shall be entitled to receive from the Corporation,
in exchange for each such share of Series G Preferred Stock:
(A) A number of shares of Common Stock equal to the
Call Price (as hereinafter defined) in effect on the redemption
date divided by the Current Market Price (as hereinafter defined)
of the Common Stock determined as of the second Trading Day (as
hereinafter defined) immediately preceding the Notice Date (as
hereinafter defined); and
(B) An amount in cash equal to all accrued and unpaid
Preferred Dividends on such share of Series G Preferred Stock to
the redemption date, whether or not earned or declared, out of
funds legally available therefor.
The "Call Price" of each share of Series G Preferred Stock is
$212.25 on and after the Initial Redemption Date through
September 14, 1997, and $211.25 on and after September 15, 1997,
until the Mandatory Conversion Date. If fewer than all of the
outstanding shares of Series G Preferred Stock are to be called for
redemption, shares to be redeemed shall be selected by the
Corporation from outstanding shares of Series G Preferred Stock not
previously redeemed 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.
(ii) Current Market Price. As used in this paragraph 3,
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 hereinafter defined) of the Common Stock for
the fifteen consecutive Trading Days (as hereinafter defined)
ending on and including such date of determination, or (Y) the
Closing Price of the Common Stock for such date of determination;
provided, however, with respect to any redemption of shares of
Series G Preferred Stock, if any event that results in an
adjustment of the Common Equivalent Rate occurs during the period
beginning on the first day of such fifteen-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.
(iii) Notice of Redemption. The Corporation shall provide
notice of any redemption of the shares of Series G Preferred Stock
to holders of record of the Series G Preferred Stock to be called
for redemption not less than 15 nor more than 60 days prior to the
date fixed for such redemption. Such notice shall be provided by
mailing notice of such redemption first class postage prepaid, to
each holder of record of shares of Series G Preferred Stock to be
redeemed, at such holder's address as it appears on the stock
register of the Corporation; provided, however, neither failure to
give such notice nor any defect therein shall affect the validity
of the proceeding for the redemption of any shares of Series G
Preferred Stock to be redeemed except as to the holder to whom the
Corporation has failed to give said notice or except as to the
holder whose notice was defective. A public announcement of any
call for redemption shall be made by the Corporation prior to, or
at the time of, the mailing of such notice of such call to holders
of shares of Series G Preferred Stock. As used in this
paragraph 3(b), the term "Notice Date" with respect to any call for
redemption of shares of Series G Preferred Stock means the date on
which first occurs either the public announcement by the
Corporation of such call for redemption or the commencement of
mailing of the notice of such redemption to the holders of such
shares, in each case pursuant to this subparagraph (iii).
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 Series G Preferred
Stock are to be redeemed or, in the case of a call for redemption
of fewer than all outstanding shares of Series G Preferred Stock,
the number of such shares held by such holder to be redeemed;
(C) The Call Price, the number of shares of Common
Stock deliverable upon redemption of each share of Series G
Preferred Stock to be redeemed and the Current Market Price used to
calculate such number of shares of Common Stock;
(D) The place or places where certificates for such
shares are to be surrendered for redemption; and
(E) That dividends on the shares of Series G
Preferred Stock to be redeemed shall cease to accrue on and after
such redemption date (except as otherwise provided herein).
(iv) Deposit of Shares and Funds. The Corporation's
obligation to deliver shares of Common Stock and provide funds upon
redemption in accordance with this paragraph 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 an office or agency in New York, New York,
and having a 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 Stock as are required to be delivered by the
Corporation pursuant to this paragraph 3(b) upon the occurrence of
the related redemption of Series G Preferred Stock 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
Series G Preferred Stock to be redeemed as required by this
paragraph 3(b), in trust for the account of the holders of such
shares of Series G Preferred Stock to be redeemed (and so as to be
and continue to be available therefor), with irrevocable instruc-
tions and authority to such bank or trust company that such shares
and funds be delivered upon redemption of the shares of Series G
Preferred Stock 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 two years from such redemption date shall be repaid and
released to the Corporation, after which the holder or holders of
such shares of Series G Preferred Stock 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 Series G Preferred Stock.
(v) Surrender of Certificates; Status. Each holder of
shares of Series G Preferred Stock to be redeemed shall 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 funds payable pursuant to this paragraph 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 Series G Preferred Stock so called for redemption shall not have
been surrendered, the shares represented thereby so called for
redemption shall be deemed no longer outstanding, Preferred
Dividends with respect to the shares so called for redemption shall
cease to accrue on the date fixed for redemption (except that
holders of shares of Series G Preferred Stock 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 prior
to such Dividend Payment Date) and all rights with respect to the
shares so called for redemption shall forthwith after such date
cease and terminate, except for the rights of the holders to
receive the shares of Common Stock and funds, if any, payable
pursuant to this paragraph 3(b) without interest upon surrender of
their certificates therefor. Holders of shares of Series G
Preferred Stock 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 Series G Preferred Stock
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) Conversion at Option of Holder. Shares of Series G
Preferred Stock are convertible, in whole or in part, at the option
of the holders thereof ("Optional Conversion"), at any time prior
to the Mandatory Conversion Date, unless previously redeemed, into
shares of Common Stock at a rate of 8.01 shares of Common Stock for
each share of Series G Preferred Stock (the "Optional Conversion
Rate"), subject to adjustment as set forth below. The right to
Optional Conversion of shares of Series G Preferred Stock called
for redemption shall terminate at the close of business on the
redemption date.
Optional Conversion of shares of Series G Preferred Stock
may be effected by delivering certificates evidencing such shares,
together with written notice of conversion and a proper assignment
of such certificates to the Corporation or in blank (and, if
applicable, payment of an amount equal to the dividend payable on
such shares), to the office of any transfer agent for the Series G
Preferred Stock 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 prior to the close of business on the date on which the
foregoing requirements shall have been satisfied. The Optional
Conversion shall be at the Optional Conversion Rate in effect at
such time and on such date.
Holders of shares of Series G Preferred Stock 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 Optional Conversion of such shares following such record date
and prior to such Dividend Payment Date. However, shares of
Series G Preferred Stock surrendered for Conversion after the close
of business on a record date for any payment of 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 Dividend thereon which is to be paid on such
Dividend Payment Date (unless such shares are subject to redemption
on a redemption date prior to such Dividend Payment Date). Except
as provided above, upon any Optional Conversion of shares of
Series G Preferred Stock, the Corporation shall make no payment or
allowance for unpaid Preferred Dividends, whether or not in
arrears, on such shares of Series G Preferred Stock as to which
Optional Conversion has been effected or for dividends or
distributions on the shares of Common Stock issued upon such
Optional Conversion.
(d) Adjustments to the Common Equivalent Rate and the
Optional Conversion Rate. The Common Equivalent Rate and the
Optional Conversion Rate shall each be subject to adjustment from
time to time as provided below in this paragraph (d).
(i) If the Corporation shall pay or make a dividend or
other 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 Common Equivalent Rate and the Optional
Conversion Rate in effect at the opening of business on the day
following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall each
be increased by multiplying such Common Equivalent Rate and
Optional Conversion Rate 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 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, 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 scrip certificates issued in lieu of fractions of shares
of Common Stock. The Corporation will not pay any dividend or make
any distribution on shares of Common Stock held in the treasury of
the Corporation.
(ii) In case outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the
Common Equivalent Rate and the Optional Conversion Rate 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 Common Equivalent Rate and the Optional Conversion Rate
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.
(iii) If the Corporation shall, after the date hereof,
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 paragraph 3(b)(ii)) on the
record date for the determination of stockholders entitled to
receive such rights or warrants, then in each case the Common
Equivalent Rate and the Optional Conversion Rate shall each be
adjusted by multiplying the Common Equivalent Rate and the Optional
Conversion Rate 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 prior to 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 prior to
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
owned by the Corporation or by another company 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
adjustment 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 Common Equivalent Rate
and the Optional Conversion Rate shall each be readjusted to the
Common Equivalent Rate and the Optional Conversion Rate which would
then be in effect had the adjustments made upon the issuance of
such rights or warrants been made upon the basis of the 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 or other assets (including shares of
capital stock of the Corporation other than Common Stock but
excluding any cash dividends or any dividends or other distribu-
tions 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 Common Equivalent
Rate and the Optional Conversion Rate shall each be adjusted by
multiplying the Common Equivalent Rate and the Optional Conversion
Rate 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 paragraph 3(b)(ii) on such record
date), and of which the denominator shall be such Current Market
Price per share of Common Stock less the fair market value (as
determined by the Board of Directors, whose determination shall be
conclusive) as of 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. 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 stockholders 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 prior to 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
subparagraph (ii) above.
(vi) Anything in this paragraph 3 notwithstanding, the
Corporation shall be entitled to make such upward adjustments in
the Common Equivalent Rate, the Optional Conversion Rate and the
Call Price, in addition to those required by this paragraph 3, as
the Corporation in its sole discretion shall determine to be
advisable, in order that any stock dividends, subdivision of
shares, distribution of rights to purchase stock or securities, or
distribution of securities convertible into or exchangeable for
stock (or any transaction which 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.
(vii) In any case in which this paragraph 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 paragraph 3(a) or redemption pursuant to paragraph 3(b) occurs
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 Series G Preferred Stock surrendered
for conversion or redemption the additional shares of Common Stock
issuable upon such conversion or redemption over the 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 paragraph 3(g).
(viii) All adjustments to the Common Equivalent Rate and
the Optional Conversion Rate shall be calculated to the nearest
1/100th of a share of Common Stock. No adjustment in the Common
Equivalent Rate or in the Optional Conversion Rate shall be
required unless such adjustment would require an increase or
decrease of at least one percent in the Common Equivalent Rate;
provided, however, any adjustments which by reason of this subpara-
graph are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All adjustments
to the Common Equivalent Rate and the Optional Conversion Rate
shall be made successively.
(ix) Before taking any action that would cause an
adjustment reducing the Common Equivalent Rate or the Optional
Conversion Rate such that the conversion price (for purposes of
this paragraph, an amount equal to the liquidation value per share
of Series G Preferred Stock divided by the Common Equivalent Rate
or the Optional Conversion Rate, respectively, as in effect from
time to time) would be below the then par value of the Common
Stock, the Corporation will 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 non-
assessable shares of Common Stock at the Common Equivalent Rate or
the Optional Conversion Rate as so adjusted.
(x) Before redeeming any shares of Series G Preferred
Stock, the Corporation will 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) Adjustment for Certain Consolidations or Mergers. In
case of any consolidation or merger to which the Corporation is a
party (other than a merger or consolidation in which the
Corporation is the continuing corporation and in which the Common
Stock outstanding immediately prior to the merger or consolidation
remains unchanged), or in 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 case of any statutory exchange
of securities with another corporation (other than in connection
with a merger or acquisition), proper provision shall be made so
that each share of the Series G Preferred Stock 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 the Series G Preferred Stock might have
been converted immediately prior to consummation of such transac-
tion, (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 the Series G
Preferred Stock would have been converted if the conversion on the
Mandatory Conversion Date had occurred immediately prior to the
date of consummation of such transaction, 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 Call Price in effect on
such redemption date upon a redemption of such share immediately
prior to consummation of such transaction, assuming that the public
announcement of such redemption had been made on the last possible
date permitted by the provisions of paragraph 3(b) hereof and
applicable law; assuming in each case that such holder 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 nonelecting share shall be deemed to be the kind and amount so
receivable per share by a plurality of the nonelecting shares).
The kind and amount of securities into which the shares of the
Series G Preferred Stock shall be convertible after consummation of
such transaction shall be subject to adjustment as described in
paragraph 3(d) following the date of consummation of such transac-
tion. The Corporation may not become a party to any such
transaction unless the terms thereof are consistent with the
foregoing.
(f) Notice of Adjustments. Whenever the Common Equivalent
Rate and Optional Conversion Rate are adjusted as provided in
paragraph 3(d), the Corporation shall:
(i) Forthwith compute the adjusted Common Equivalent
Rate and Optional Conversion Rate in accordance with this
paragraph 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 Common Equivalent Rate and
Optional Conversion Rate, 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 file such certificate forthwith with the transfer
agent or agents for the Series G Preferred Stock and the Common
Stock;
(ii) Make a prompt public announcement stating that the
Common Equivalent Rate and Optional Conversion Rate have been
adjusted and setting forth the adjusted Common Equivalent Rate and
Optional Conversion Rate; and
(iii) Mail a notice stating that the Common Equivalent
Rate and Optional Conversion Rate have been adjusted, the facts
requiring such adjustment and upon which such adjustment is based
and setting forth the adjusted Common Equivalent Rate and Optional
Conversion Rate, to the holders of record of the outstanding shares
of the Series G Preferred Stock at or prior to the time the
Corporation mails an interim statement 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) Notices of Proposed Actions. In case, at any time
while any of the shares of Series G Preferred Stock are
outstanding,
(i) the Corporation shall declare a dividend (or any
other distribution) on the Common Stock, excluding any cash
dividends, 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) of any reclassification of the Common Stock (other
than a subdivision or combination thereof) or of 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 then
existing and the new state of domicile), or of 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
Series G Preferred Stock, and shall cause to be mailed to the
holders of shares of Series G Preferred Stock at their last
addresses as they shall appear on the stock register, at least
10 days before the date hereinafter specified (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, dissolu-
tion, 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.
(h) No Fractional Shares. No fractional shares of Common
Stock shall be issued upon the redemption or conversion of any
shares of the Series G Preferred Stock. In lieu of any fraction of
a share of Common Stock which would otherwise be issuable in
respect of the aggregate number of shares of the Series G Preferred
Stock surrendered by the same holder for redemption or conversion
on any redemption date or upon Automatic Conversion or Optional
Conversion, such holder shall have the right 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 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 Automatic 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 Series G Preferred Stock 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 Series G Preferred Stock so
surrendered or redeemed.
(i) 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 Series G Preferred Stock as herein
provided, free from any preemptive rights, such number of shares of
Common Stock as shall from time to time be issuable upon the
conversion or redemption of all the shares of Series G Preferred
Stock then outstanding.
(j) Definitions. As used in this Certificate of
Designation:
(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
closing sale price regular way on such day or, in case no such sale
takes place on such day, the average of the reported closing bid
and asked prices regular way, in each case on the New York Stock
Exchange or, if the Common Stock is not listed or admitted to
trading on such Exchange, on the principal national securities
exchange on which the Common Stock is listed or admitted to
trading, or, if not listed or admitted to trading on any national
securities exchange, the average of the closing bid and asked
prices of the Common Stock on the over-the-counter market on the
day in question as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System, or a similarly
generally accepted reporting service, or if not so available in
such manner, as furnished by any New York Stock Exchange member
firm selected from time to time by the Board of Directors of the
Corporation for that purpose; and
(iii) The term "Trading Day" shall mean a date on which
the New York Stock Exchange (or any successor to such Exchange) is
open for the transaction of business.
(k) Payment of Taxes. The Corporation will 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 Series G Preferred Stock
pursuant to this paragraph 3; provided, however, the Corporation
shall not be required to pay any tax which may be payable in
respect of any registration or 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 Series G Preferred Stock 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.
4. Liquidation Rights. In the event of any liquidation or
dissolution or winding up of the Corporation, voluntary or
involuntary, the holders of the Series G Preferred Stock shall be
entitled to receive the sum of $211.25 per share, plus an amount
equal to any arrearages in dividends thereon.
5. Voting Rights. The holders of shares of Series G
Preferred Stock shall be entitled to vote on all matters submitted
to a vote of the stockholders of the Corporation, voting together
with the holders of Common Stock as one class. The holder of each
share of Series G Preferred Stock shall be entitled to one vote for
each share of Series G Preferred Stock held by such holder. In
addition, the provisions of Section 2.8 of the Restated Certificate
of Incorporation shall be applicable to the Series G Preferred
Stock.
IN WITNESS WHEREOF, Boise Cascade Corporation has caused this
Certificate of Designation to be signed by John W. Holleran, its
Vice President and General Counsel, and attested by A. James
Balkins III, its Corporate Secretary, this 22nd day of September,
1993.
BOISE CASCADE CORPORATION
By /s/ John W. Holleran
John W. Holleran
Vice President and General
Counsel
ATTEST:
By /s/ A. James Balkins III
A. James Balkins III
Corporate Secretary