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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-A/A
Amendment No. 4
For Registration of Certain Classes of Securities
Pursuant to Section 12(b) or 12(g) of The
Securities Exchange Act of 1934
THE TJX COMPANIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 04-2207613
(State of incorporation or organization) (I.R.S. employer
identification no.)
770 Cochituate Road, Framingham, Massachusetts 01701
(Address of principal executive offices) (zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on
to be so registered which each class is to be registered
Common Stock New York Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
None
(Title of class)
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The undersigned Registrant hereby amends the following items of its Registration
Statement on Form 8-A with respect to the Common Stock, par value $1.00 per
share, originally dated September 24, 1965, to read in their entireties as set
forth below:
Item 1. Description of Registrant's Securities to be Registered.
The following summary description of the Company's capital stock is
qualified in its entirety by reference to the Restated Certificate of
Incorporation of the Company, as amended (the "Certificate"), and the By-Laws of
the Company (the "By-Laws"), copies of which are filed as exhibits to this form
and are hereby incorporated by reference herein.
Authorized Capital Stock
The Company's authorized capital stock consists of 155 million shares
of capital stock, of which 150 million shares are Common Stock, $1.00 par value
per share, and 5 million shares are preferred stock, $1.00 par value per share
(the "Preferred Stock"). The Certificate authorizes the issuance of shares of
Preferred Stock from time to time in one or more series not exceeding the
aggregate number of shares of Preferred Stock authorized by the Certificate,
without stockholder approval, with such voting powers, designations, preferences
and relative, participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, as are set forth in
resolutions adopted by the Company's Board of Directors. Thus, without
stockholder approval, the Company could authorize the issuance of Preferred
Stock with voting, conversion and other rights that could dilute the voting
power and other rights of holders of the Common Stock and other series of
Preferred Stock. There are outstanding as of May 30, 1996 four classes of
Preferred Stock: New Series A Cumulative Convertible Preferred Stock ("Series A
Preferred Stock"), $3.125 Series C Cumulative Convertible Preferred Stock
("Series C Preferred Stock"), Series D Cumulative Convertible Preferred Stock
("Series D Preferred Stock") and Series E Cumulative Convertible Preferred Stock
("Series E Preferred Stock"). The Company has given notice to the holders of the
Series A Preferred Stock that it intends to redeem all outstanding shares of
Series A Preferred Stock on June 24, 1996.
Common Stock
Subject to the rights of holders of Preferred Stock (including the
Series A Preferred Stock, the Series C Preferred Stock, the Series D Preferred
Stock and the Series E Preferred Stock), holders of Common Stock are entitled to
receive such dividends as may from time to time be declared by the Board of
Directors of the Company out of such funds legally available for declaration of
dividends. Holders of Common Stock are entitled to one vote per share on every
question submitted to them at a meeting of stockholders or otherwise. In the
event of a liquidation, dissolution or winding up and distribution of the assets
of the Company, after paying or setting aside for the holders of Preferred Stock
the full preferential amounts to which they are entitled, and subject to the
rights of any series of Preferred Stock to participate pro rata with the Common
Stock with respect to distributions, the holders of Common Stock will be
entitled to receive pro rata all remaining assets of the Company available for
distribution to stockholders. There are no pre-emptive rights for holders of
Common Stock. The issued and outstanding shares of Common Stock are fully paid
and nonassessable. Shares of Common Stock are not convertible into shares of any
other class of capital stock of the Company.
Series A Preferred Stock
Notice of Redemption
The Company has given notice to the holders of the Series A Preferred
Stock that it intends to redeem all outstanding shares of Series A Preferred
Stock on June 24, 1996.
Ranking
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The Series A Preferred Stock ranks, with respect to dividends or upon
liquidation, dissolution or winding up, (i) on a parity with the Series C
Preferred Stock, and other Preferred Stock permitted pursuant to the terms of
the Series A Preferred Stock and ranking with respect to dividends or upon
liquidation, dissolution or winding up on a parity with the Series A Preferred
Stock, and (ii) prior to all other capital stock of the Company. Without the
consent of the holders of two-thirds of the outstanding shares of Series A
Preferred Stock, the Company may not authorize, create or increase the
authorized amount of any class or series of stock that ranks prior to or, except
for the Series C Preferred Stock and a limited amount of Preferred Stock ranking
as to dividends or upon liquidation, dissolution or winding up on a parity with
the Series C Preferred Stock, on a parity with the Series A Preferred Stock or,
except for non-participating Preferred Stock and participating Preferred Stock
issued pursuant to certain stockholder rights plans, ranking junior to the
Series A Preferred Stock with respect to the payment of dividends or upon
liquidation, dissolution or winding up.
Dividends
Holders of shares of the Series A Preferred Stock are entitled to
receive, when and as declared by the Board of Directors of the Company out of
assets of the Company legally available for payment, cash dividends at the rate
of $8.00 per share per annum, payable quarterly on January 1, April 1, July 1
and October 1 of each year. Unless Full Cumulative Dividends on all outstanding
shares of the Series A Preferred Stock have been paid or declared and set aside
for payment for all past dividend payment periods, no dividend may be declared
on any stock ranking junior to the Series A Preferred Stock. No shares of stock
ranking junior to or on parity with the Series A Preferred Stock may be redeemed
or purchased by the Company (other than pursuant to certain conversion rights)
unless Full Cumulative Dividends on all outstanding shares of Series A Preferred
Stock have been paid or declared and set aside for payment. If dividends on the
Series A Preferred Stock and on any other series of Preferred Stock ranking on a
parity as to dividends with the Series A Preferred Stock are in arrears, any
dividends declared on each such series must be declared ratably upon all
outstanding shares of the Series A Preferred Stock and such other series of
Preferred Stock in proportion to the respective amounts of dividends in arrears,
other than distributions made to holders of the Series A Preferred Stock from
certain escrows established pursuant to conversion rights of the Series A
Preferred Stock.
Liquidation Rights
In the event of any voluntary or involuntary liquidation, dissolution
or winding up of the Company (not including certain mergers, consolidations or
sales of all or substantially all assets), before any distribution of assets is
made to holders of Common Stock or any other stock of the Company ranking junior
to the shares of Series A Preferred Stock as to such a distribution, the holders
of Series A Preferred Stock shall receive a liquidation preference of the then
applicable redemption price and shall receive all accrued but unpaid dividends
through the date of distribution, and the holders of any series of Preferred
Stock ranking on a parity with the Series A Preferred Stock upon such
liquidation, dissolution or winding up shall receive the full respective
liquidation preferences to which they are entitled and shall receive all accrued
but unpaid dividends with respect to their respective shares through and
including the date of final distribution to such holders. If upon such a
voluntary or involuntary dissolution, liquidation or winding up of the Company,
the assets of the Company are insufficient to pay in full the amounts payable
with respect to the Series A Preferred Stock and any such stock of the Company
ranking on a parity with the Series A Preferred Stock, the holders of the Series
A Preferred Stock and such other Preferred Stock will share ratably in any such
distribution of assets of the Company first in proportion to their respective
liquidation preferences until such preferences are paid in full, and then in
proportion to their respective amounts of accrued but unpaid dividends. After
payment of any such liquidating preference and accrued dividends, the shares of
Series A Preferred Stock will not be entitled to any further participation in
any distribution of assets by the Company.
Redemption
Commencing April 1, 1995, the Series A Preferred Stock may be redeemed
in whole or in part at any time at a redemption price of $104.80 per share,
declining by $0.80 per share on April 1 of each year thereafter to $100
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per share on April 1, 2001, plus accrued and unpaid dividends to the redemption
date. Upon a Change of Control Event (generally defined as voluntary
liquidations, certain mergers into a subsidiary, a sale of all or substantially
all the Company's assets, or certain actions affecting the public market for the
Company's Common Stock or its status as a public corporation), a holder of
Series A Preferred Stock may at its option require redemption of its shares at a
cash per share price equal to the greater of (i) the then redemption price or
(ii) the product of the higher of the then market price of Common Stock or the
price per share of Common Stock received by any other stockholder in the Change
of Control Event or related transactions times the number of shares of Common
Stock then issuable upon conversion of a share of Series A Preferred Stock.
Voting Rights
Holders of Series A Preferred Stock will be entitled as a separate
class to elect two directors in the event of defaults in the payment of
dividends aggregating $8.00 per share and are entitled to a separate class vote
on matters which would adversely affect the rights and preferences of the Series
A Preferred Stock. So long as any shares of Series A Preferred Stock remain
outstanding, the Company may not, without the affirmative vote or consent of the
holders of at least two-thirds of the Series A Preferred Stock, voting as a
single class, (i) authorize, create or issue, or increase the authorized or
issued amount of, any class or series of stock ranking prior to or on parity
with the Series A Preferred Stock as to dividends or upon liquidation,
dissolution or winding up, except for Preferred Stock ranking on a parity with
the Series A Preferred Stock having an aggregate liquidation preference of not
more than $100 million; (ii) authorize, create or issue, or increase the
authorized amount of, any participating Preferred Stock; (iii) create, authorize
or issue any class or series of common stock other than the Common Stock; (iv)
amend the Certificate or By-laws if such amendment would adversely affect the
powers, rights, privileges or preferences of the Series A Preferred Stock; (v)
increase the number of shares of Series A Preferred Stock authorized for
issuance; (vi) create, authorize or issue any class or series of capital stock
or any security exercisable for or convertible into any capital stock except as
permitted under clauses (i), (ii) or (iii) above; (vii) amend the Certificate of
Designations relating to the Series A Preferred Stock or (viii) issue any
additional shares of Series A Preferred Stock.
Conversion
Shares of the Series A Preferred Stock are convertible at any time at
the option of the holder thereof into shares of Common Stock of the Company at a
rate per share of Series A Preferred Stock equal to $100 divided by a conversion
price of $21.00 per share of Common Stock, subject to adjustment in certain
events including subdivisions, splits or combinations of Common Stock, stock
dividends, extraordinary dividends or distributions on the Common Stock and
issuance of Common Stock and related securities for less than the current Market
Value. Upon the occurrence of a Control Adjustment Event (generally defined to
be the acquisition by any person or group of beneficial ownership of at least
51% of the Common Stock, incumbent directors ceasing during any year to
constitute a majority of the Board of Directors or involuntary liquidation of
the Company), the conversion price is subject to adjustment downward to the
greater of $3.50 and the then market price of the Common Stock. Holders of
shares of Series A Preferred Stock have a similar adjustment election in the
event of the Registrant's failure to make payment upon any mandatory redemption.
Any share of Series A Preferred Stock outstanding on April 15, 2007 is entitled
to a conversion price adjustment to the higher of $7.00 and the then market
price of the Common Stock.
Eligibility for Sale; Registration Rights, Etc.
The holders of the Series A Preferred Stock have agreed not to transfer
any shares of Series A Preferred Stock, or Common Stock issuable upon conversion
thereof, except (i) pursuant to an effective registration under the Securities
Act, (ii) in accordance with Rule 144 or Rule 144A under the Securities Act, or
(iii) in a transaction otherwise not requiring registration under the Securities
Act.
In general, under Rule 144 as currently in effect, a person (or persons
whose shares are aggregated) who has beneficially owned his or her shares for at
least two years (in the case of the holders of the Series A Preferred Stock, no
earlier than April 14, 1994), including an "affiliate," as that term is defined
below, is entitled to sell, within any
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three-month period, that number of shares that does not exceed the greater of 1%
of the then outstanding shares or the average weekly trading volume of the then
outstanding shares during the four calendar weeks preceding each such sale. A
person (or persons whose shares are aggregated) who is not deemed an "affiliate"
of the Company, and who has beneficially owned shares for at least three years,
is entitled to sell such shares under Rule 144 without regard to the volume
limitations described above. As defined in Rule 144, an "affiliate" of an issuer
is a person that directly or indirectly through the use of one or more
intermediaries, controls, or is controlled by, or is under common control with,
such issuer.
In general, under Rule 144A as currently in effect, shares of a class
of stock (such as the Series A Preferred Stock) which were not, when issued, of
the same class as securities listed on a national securities exchange or quoted
in a U.S. automated inter-dealer quotation system, generally may be sold without
registration under the Securities Act to "qualified institutional buyers"
(defined in Rule 144A generally to include certain institutions investing on a
discretionary basis at least $100 million in securities other than those of the
issuer, and certain securities dealers).
Under their respective share purchase agreements, holders of shares of
Series A Preferred Stock are entitled to certain rights regarding registration
of their shares under the Securities Act. Such holders are entitled to include,
at the Company's expense, their shares of Series A Preferred Stock, or any
shares of any Common Stock issued upon conversion thereof, in certain
registrations under the Securities Act by the Company prior to April 15, 1997 of
offerings of Convertible Preferred Stock or Common Stock or rights thereto,
provided that no such shares need be included in a registration by the Company
of an underwritten offering to the extent that the underwriters determine that
such inclusion would jeopardize the successful sale of the shares to be sold by
the underwriters. At any time prior to April 15, 1997 the holders of the Series
A Preferred Stock may demand the registration under the Securities Act, at the
Company's expense, of the public sale of a portion or all of such shares;
provided that the Company may delay such a registration for up to 90 days in
certain events. In any registration of an offering of Series A Preferred Stock,
the Company is required to keep the registration statement effective for up to
120 days.
The share purchase agreements also contain various undertakings by the
Company, including limitations on dividends and repurchases of the Company's
stock, changes in the primary business engaged in by the Company and its
subsidiaries and certain restrictions on dividends.
Definition
The following term shall have the meaning indicated in respect of the
Series A Preferred Stock:
"Full Cumulative Dividends" shall mean, with respect to the Series A
Preferred Stock, or any other capital stock of the Company, as of any date the
aggregate amount of all then accumulated, accrued and unpaid dividends payable
on such shares of Series A Preferred Stock, or other capital stock, as the case
may be, in cash, whether or not earned or declared and whether or not there
shall be funds legally available for the payment thereof.
Series C Preferred Stock
Ranking
The Series C Preferred Stock ranks senior to the Common Stock, the
Series D Preferred Stock and the Series E Preferred Stock, and on a parity with
the Series A Preferred Stock, with respect to the payment of dividends and upon
liquidation, dissolution or winding up. The Series C Preferred Stock shall so
rank on a parity with the Series D Preferred Stock and the Series E Preferred
Stock at such times as there shall be no shares of Series A Preferred Stock
outstanding. The Company may not, without the consent of two-thirds of the votes
of the holders of the outstanding shares of Series C Preferred Stock and all
other outstanding shares of Preferred Stock ranking on a parity with the Series
C Preferred Stock either as to dividends or upon liquidation, dissolution or
winding up, voting together as a single class, create, authorize or issue, or
reclassify any authorized stock of the Company into, or create, authorize or
issue any obligation or security convertible into or evidencing a right to
purchase, any shares of any class
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of stock of the Company ranking prior to the Series C Preferred Stock or ranking
prior to any other series of Preferred Stock which ranks on a parity with the
Series C Preferred Stock. However, the Company may create additional classes of
stock or issue series of Preferred Stock ranking on a parity with the Series C
Preferred Stock with respect to the payment of dividends or upon liquidation,
dissolution and winding up without the consent of any holder of Series C
Preferred Stock.
Dividends
Holders of shares of the Series C Preferred Stock are entitled to
receive, when and as declared by the Board of Directors of the Company out of
assets of the Company legally available for payment, cash dividends at an annual
rate of $3.125 per share of Series C Preferred Stock, payable in arrears on
January 1, April 1, July 1 and October 1 of each year. Each dividend is payable
to holders of record as they appear on the stock books of the Company on a
Record Date, not more than 60 nor less than 10 days before the payment date,
fixed by the Board of Directors of the Company. Dividends on the Series C
Preferred Stock are cumulative and are computed for each full dividend period by
dividing the annualized dividend rate by four. The Series C Preferred Stock is
not entitled to any dividend, whether payable in cash, property or stock, in
excess of Full Cumulative Dividends. No interest, or sum of money in lieu of
interest, is payable in respect of any accrued and unpaid dividends.
Unless Full Cumulative Dividends on all outstanding shares of the Series
C Preferred Stock have been paid or declared and set aside for payment for all
past dividend payment periods, no dividend (other than a dividend paid in stock
ranking junior to the Series C Preferred Stock as to dividends) may be declared
on any stock ranking junior to the Series C Preferred Stock as to dividends, nor
may any stock ranking junior to the Series C Preferred Stock as to dividends or
upon liquidation, dissolution or winding up be redeemed or purchased by the
Company nor any sinking fund payment made for such redemption or purchase
(other than a purchase or redemption made by issue or delivery of stock
ranking junior to the Series C Preferred Stock as to dividends or upon
liquidation, dissolution or winding up); provided that, unless prohibited by the
terms of any other outstanding series of Preferred Stock, any monies theretofore
deposited in any sinking fund with respect to any Preferred Stock in compliance
with the terms thereof may thereafter be applied in accordance with the terms
thereof. If dividends on Series C Preferred Stock and on any other series of
Preferred Stock ranking on a parity as to dividends with the Series C Preferred
Stock are in arrears, any dividend payment on account of such arrearage must be
made ratably upon all outstanding shares of the Series C Preferred Stock and
such other series of Preferred Stock in proportion to the respective amounts of
Full Cumulative Dividends, other than distributions made to holders of the
Series A Preferred Stock from certain escrows established pursuant to conversion
rights of the Series A Preferred Stock.
Liquidation Rights
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company (not including mergers, consolidation or sale of all
or substantially all assets), before any payment or distribution of assets is
made to holders of Common Stock or any other stock of the Company ranking junior
to the shares of Series C Preferred Stock upon liquidation, dissolution or
winding up, the holders of Series C Preferred Stock shall receive a liquidation
preference of $50 per share and shall be entitled to receive all accrued and
unpaid dividends through the date of distribution, and the holders of any class
or series of Preferred Stock ranking on a parity with the Series C Preferred
Stock as to liquidation, dissolution or winding up shall be entitled to receive
the full respective liquidation preferences (including any premium) to which
they are entitled and shall receive all accrued and unpaid dividends with
respect to their respective shares through and including the date of
distribution. If, upon such a voluntary or involuntary liquidation, dissolution
or winding up of the Company, the assets of the Company are insufficient to pay
in full the amounts described above as payable with respect to the Series C
Preferred Stock and any class or series of Preferred Stock of the Company
ranking on a parity with the Series C Preferred Stock as to liquidation,
dissolution or winding up, the holders of the Series C Preferred Stock and of
such other class or series of Preferred Stock will share ratably in any such
distribution of assets of the Company first in proportion to their respective
liquidation preferences until such preferences are paid in full, and then in
proportion to their respective amounts of accrued but unpaid dividends. After
payment of any such liquidating preference and accrued dividends, the shares of
Series C
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Preferred Stock will not be entitled to any further participation in any
distribution of assets by the Company. Neither the sale of all or substantially
all the assets of the Company, nor the merger or consolidation of the Company
into or with any other corporation, will be deemed to be a liquidation,
dissolution or winding up of the Company.
Optional Redemption
Shares of the Series C Preferred Stock are not subject to any mandatory
redemption, sinking fund or other similar provision. The Series C Preferred
Stock is redeemable at the option of the Company upon notice at any time, in
whole or in part, at a redemption price per share (expressed as a percentage of
the $50 liquidation preference thereof), plus any accrued and unpaid dividends
up to but excluding the date fixed for redemption, if redeemed during the
twelve-month period commencing on September 1 of the years indicated below:
Redemption Redemption
Year Price Year Price
1995.........................104.375% 1999........................101.875%
1996.........................103.750 2000........................101.250
1997.........................103.125 2001........................100.625
1998.........................102.500 2002 and thereafter.........100.000
If fewer than all of the outstanding shares of the Series C Preferred
Stock are to be redeemed, the shares to be redeemed will be determined pro rata
as nearly as practicable or by lot, or by such other method as the Board of
Directors may determine to be fair and appropriate. In the event that any
quarterly dividends payable on the Series C Preferred Stock are in arrears, the
Series C Preferred Stock may not be redeemed unless all outstanding shares of
Series C Preferred Stock are simultaneously redeemed and the Company may not
purchase or acquire any of such shares otherwise than pursuant to a purchase or
exchange offer made on the same terms to all holders of record of the Series C
Preferred Stock.
Notice of redemption will be given by mail, not less than 30 nor more
than 60 days prior to the date fixed for redemption thereof, to each record
holder of the shares of Series C Preferred Stock to be redeemed at the address
of such holder in the stock register of the Company. If a notice of redemption
has been given, from and after the specified redemption date (unless the Company
defaults in making payment of the redemption price), dividends on the Series C
Preferred Stock so called for redemption will cease to accrue, such shares will
no longer be deemed to be outstanding, and all rights of the holders thereof as
stockholders of the Company (except the right to receive the redemption price)
will cease.
Voting Rights
Except as indicated below or as expressly required by applicable law,
the holders of the Series C Preferred Stock have no voting rights.
If the equivalent of six full quarterly dividends payable on the Series
C Preferred Stock are in arrears, the maximum authorized number of directors of
the Company will be increased by two and the holders of Series C Preferred
Stock, voting separately as a class with the holders of shares of any other
series of Preferred Stock ranking on a parity with the Series C Preferred Stock
and upon which like voting rights have been conferred and are exercisable (which
does not include the Series A Preferred Stock, which has separate voting rights
in the case of dividend arrearages), will be entitled to elect two directors for
successive one-year terms until all dividends in arrears on the Series C
Preferred Stock have been paid or declared and set apart for payment. Upon
payment or declaration
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and setting apart of funds for payment of all such dividends in arrears, the
term of office of each director elected will immediately terminate and the
number of directors constituting the entire Board of Directors of the Company
will be reduced by the number of directors elected by the holders of the Series
C Preferred Stock and any other series of Preferred Stock ranking on a parity
with the Series C Preferred Stock as discussed above.
The Company may not, without the affirmative vote or consent of
two-thirds of the votes of the holders of the Series C Preferred Stock and each
other series of Preferred Stock ranking on a parity with the Series C Preferred
Stock and upon which like voting rights have been conferred (voting together as
a single class), create, authorize or issue, or reclassify any authorized stock
of the Company into, or create, authorize or issue any obligation or security
convertible into or evidencing a right to purchase, any shares of any class of
stock of the Company ranking prior to the Series C Preferred Stock or any other
series of Preferred Stock which ranks on a parity with the Series C Preferred
Stock. The Company may not, without the affirmative vote or consent of
two-thirds of the votes of the holders of the outstanding shares of the Series C
Preferred Stock and each other series of Preferred Stock of the Company
similarly affected, if any, voting together as a single class, amend, alter or
repeal any provision of the Certificate which would materially and adversely
affect the preferences, rights, powers or privileges, qualification, limitations
and restrictions of the Series C Preferred Stock and any such other series of
Preferred Stock; provided, however, that the creation, issuance or increase in
the amount of authorized shares of any other series of Preferred Stock ranking
on a parity with or junior to the Series C Preferred Stock with respect to the
payment of dividends or the distribution of assets upon liquidation, dissolution
or winding up of the affairs of the Company will not be deemed to materially and
adversely affect such rights and preferences, privileges or voting powers.
Conversion
Shares of the Series C Preferred Stock are convertible at any time at
the option of the holder thereof into such number of whole shares of Common
Stock as is equal to the aggregate liquidation preference of the shares of
Series C Stock surrendered for conversion divided by the conversion price of
$25.9375 per share of Common Stock, subject to adjustment as described below.
Shares of Series C Preferred Stock surrendered for conversion during the period
after any dividend payment record date and prior to the corresponding dividend
payment date must be accompanied by payment of an amount equal to the dividend
payable on such shares on such dividend payment date. Shares of Series C
Preferred Stock called for redemption will not be convertible after the close of
business on the Business Day preceding the date fixed for redemption, unless the
Company defaults in payment of the redemption price.
The initial conversion price of $25.9375 per share of Common Stock is
subject to adjustment (under formulae set forth in the Certificate of
Designations) in certain events, including: (i) the issuance of Common Stock as
a dividend or distribution on Common Stock of the Company; (ii) certain
subdivisions and combinations of the Common Stock; (iii) the issuance to all
holders of Common Stock of certain rights or warrants to purchase Common Stock;
(iv) the distribution to all holders of Common Stock of shares of capital stock
of the Company (other than Common Stock) or evidences of indebtedness of the
Company or assets (including securities, but excluding those rights, warrants,
dividends and distributions referred to above and dividends and distributions in
connection with the liquidation, dissolution or winding up of the Company or
paid in cash); (v) distributions consisting of cash, excluding any quarterly
cash dividend on the Common Stock to the extent that the aggregate cash dividend
per share of Common Stock in any quarter does not exceed the greater of (x) the
amount per share of Common Stock of the next preceding quarterly cash dividend
on the Common Stock to the extent that such preceding quarterly dividend did not
require an adjustment of the Conversion Price pursuant to this clause (v) (as
adjusted to reflect subdivisions or combinations of the Common Stock), and (y)
3.75 percent of the average of the daily Closing Prices of the Common Stock for
the ten consecutive Trading Days immediately prior to the date of declaration of
such dividend, and excluding any dividend or distribution in connection with the
liquidation, dissolution or winding up of the Company; and (vi) payment in
respect of a tender or exchange offer by the Company or any subsidiary of the
Company for the Common Stock to the extent that the cash and value of any other
consideration included in such payment per share of Common Stock exceeds the
Current Market Price per share of Common Stock on the Trading Day next
succeeding the date of payment. If any adjustment is required to be made as set
forth in clause (v) above as a result of a distribution which is a quarterly
dividend, such adjustment would be based upon the amount by which such
distribution exceeds the amount of the quarterly cash
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dividend permitted to be excluded pursuant to such clause (v). If an adjustment
is required to be made as set forth in (v) above as a result of a distribution
which is not a quarterly dividend, such adjustment would be based upon the full
amount of such distribution.
The Company from time to time may to the extent permitted by law reduce
the conversion price by any amount for any period of at least 20 days, in which
case the Company shall give at least 15 days' notice of such reduction, if the
Board of Directors has made a determination that such reduction would be in the
best interests of the Company, which determination shall be conclusive. The
Company may, at its option, make such reduction in the conversion price, in
addition to those set forth above, as the Board of Directors deems advisable to
avoid or diminish any income tax to holders of Common Stock resulting from any
dividend or distribution of stock (or rights to acquire stock) or from any event
treated as such for income tax purposes.
If any transaction shall occur, including without limitation (i) any
recapitalization or reclassification of shares of Common Stock (other than a
change in par value, or from par value to no par value, or from no par value to
par value, or as a result of a subdivision or combination of the Common Stock),
(ii) any consolidation or merger of the Company with or into another person or
any merger of another person into the Company (other than a merger that does not
result in a reclassification, conversion, exchange or cancellation of Common
Stock), (iii) any sale or transfer of all or substantially all of the assets of
the Company, or (iv) any compulsory share exchange, pursuant to any of which
holders of Common Stock shall be entitled to receive other securities, cash or
other property, then appropriate provision shall be made so that the holder of
each share of Series C Preferred Stock then outstanding shall have the right
thereafter to convert such share only into (x) in the case of any such
transaction that does not constitute a Common Stock Fundamental Change (as
defined below) and subject to funds being legally available for such purpose
under applicable law at the time of such conversion, the kind and amount of the
securities, cash or other property that would have been receivable upon such
recapitalization, reclassification, consolidation, merger, sale, transfer or
share exchange by a holder of the number of shares of Common Stock issuable upon
conversion of such share of Series C Preferred Stock immediately prior to such
recapitalization, reclassification, consolidation, merger, sale, transfer or
share exchange, after giving effect, in the case of any Non-Stock Fundamental
Change (as defined below), to any adjustment in the conversion price in
accordance with clause (i) of the following paragraph, and (y) in the case of
any such transaction that constitutes a Common Stock Fundamental Change, common
stock of the kind received by holders of Common Stock as a result of such Common
Stock Fundamental Change in an amount determined in accordance with clause (ii)
of the following paragraph. The company formed by such consolidation or
resulting from such merger or that acquires such assets or that acquires the
Company's shares, as the case may be, shall make provisions in its certificate
or articles of incorporation or other constituent document to establish such
right. Such certificate or articles of incorporation or other constituent
document shall provide for adjustments that, for events subsequent to the
effective date of such certificate or articles of incorporation or other
constituent documents, shall be as nearly equivalent as may be practicable to
the relevant adjustments provided for in the preceding paragraph and in this
paragraph.
Notwithstanding any other provision in the preceding paragraphs to the
contrary, if any Fundamental Change (as defined below) occurs, then the
conversion price in effect will be adjusted immediately after such Fundamental
Change as follows:
(i) in the case of a Non-Stock Fundamental Change, the
conversion price of the shares of Series C Preferred Stock immediately
following such Non-Stock Fundamental Change shall be the lower of (A)
the conversion price in effect immediately prior to such Non-Stock
Fundamental Change, but after giving effect to any other prior
adjustments effected pursuant to the preceding paragraphs, and (B) the
product of (1) the greater of the Applicable Price (as defined below)
and the then applicable Reference Market Price (as defined below) and
(2) a fraction, the numerator of which is $50 and the denominator of
which is (x) the amount of the redemption price for one share of Series
C Preferred Stock if the redemption date were the date of such
Non-Stock Fundamental Change, plus (y) any then accrued and
then-accumulated and unpaid dividends on Series C Preferred Stock; and
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(ii) in the case of a Common Stock Fundamental Change, the
conversion price of the shares of Series C Preferred Stock immediately
following such Common Stock Fundamental Change shall be the conversion
price in effect immediately prior to such Common Stock Fundamental
Change, but after giving effect to any other prior adjustments effected
pursuant to the preceding paragraphs, multiplied by a fraction, the
numerator of which is the Purchaser Stock Price (as defined below) and
the denominator of which is the Applicable Price; provided, however,
that in the event of a Common Stock Fundamental Change in which (A)
100% of the value of the consideration received by a holder of Common
Stock is common stock of the successor, acquiror, or other third party
(and cash, if any, paid with respect to any fractional interests in
such common stock resulting from such Common Stock Fundamental Change)
and (B) all of the Common Stock of the Company shall have been
exchanged for, converted into, or acquired for, common stock of the
successor, acquiror or other third party (and any cash with respect to
fractional interests), the conversion price of the shares of Series C
Preferred Stock immediately following such Common Stock Fundamental
Change shall be the conversion price in effect immediately prior to
such Common Stock Fundamental Change multiplied by a fraction, the
numerator of which is one (1) and the denominator of which is the
number of shares of common stock of the successor, acquiror, or other
third party received by a holder of one share of Common Stock as a
result of such Common Stock Fundamental Change.
Depending upon whether a Fundamental Change is a Non-Stock Fundamental
Change or a Common Stock Fundamental Change, a holder may receive significantly
different consideration upon conversion. In the event of a Non-Stock Fundamental
Change, the holder has the right to convert shares of Series C Preferred Stock
into the kind and amount of the shares of stock and other securities or property
or assets (including cash), except as otherwise provided above, as is determined
by the number of shares of Common Stock receivable upon conversion at the
conversion price as adjusted in accordance with clause (i) of the preceding
paragraph. However, in the event of a Common Stock Fundamental Change in which
less than 100% of the value of the consideration received by a holder of Common
Stock is common stock of the successor, acquiror or other third party, a holder
of a share of Series C Preferred Stock who converts such share following the
Common Stock Fundamental Change will receive consideration in the form of such
common stock only, whereas a holder who converted such share prior to the Common
Stock Fundamental Change would have received consideration in the form of such
common stock as well as any other securities or assets (which may include cash)
issuable upon conversion of such share of Series C Preferred Stock immediately
prior to such Common Stock Fundamental Change.
No adjustment to the conversion price will be required to be made in
any case until cumulative adjustments amount to 1% or more of the conversion
price.
Definitions
The following terms shall have the meanings indicated in respect of the
Series C Preferred Stock:
"Applicable Price" shall mean (i) in the event of a Non-Stock
Fundamental Change in which the holders of the Common Stock receive only cash,
the amount of cash received by a holder of one share of Common Stock and (ii) in
the event of any other Non-Stock Fundamental Change or any Common Stock
Fundamental Change, the average of the reported last sale price for one share of
the Common Stock (determined as provided in the Certificate of Designations)
during the 10 Trading Days immediately prior to the Record Date for the
determination of the holders of Common Stock entitled to receive cash,
securities, property or other assets in connection with such Non-Stock
Fundamental Change or Common Stock Fundamental Change or, if there is no such
Record Date, prior to the date upon which the holders of the Common Stock shall
have the right to receive such cash, securities, property or other assets.
"Business Day" shall mean any day other than a Saturday, Sunday, or a
day on which banking institutions in the State of New York or The Commonwealth
of Massachusetts are authorized or obligated by law or executive order to close
or a day which is or is declared a national or New York or Massachusetts state
holiday;
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"Closing Price" with respect to any securities 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 such security
is not listed or admitted to trading on such Exchange, on the principal national
securities exchange or quotation system on which such security is quoted or
listed or admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation system, the average of
the closing bid and asked prices of such security on the over-the-counter market
on the day in question as reported by the National Quotation Bureau
Incorporated, 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 for that purpose or a
price determined in good faith by the Board of Directors.
"Common Stock Fundamental Change" shall mean any Fundamental Change in
which more than 50% of the value (as determined in good faith by the Board of
Directors of the Company) of the consideration received by holders of Common
Stock consists of common stock that, for the 10 Trading Days immediately prior
to such Fundamental Change, has been admitted for listing or admitted for
listing subject to notice of issuance on a national securities exchange or
quoted on the National Market System of the National Association of Securities
Dealers, Inc. Automated Quotations System; provided, however, that a Fundamental
Change shall not be a Common Stock Fundamental Change unless either (i) the
Company continues to exist after the occurrence of such Fundamental Change and
the outstanding shares of Series C Preferred Stock continue to exist as
outstanding shares of Series C Preferred Stock, or (ii) not later than the
occurrence of such Fundamental Change, the outstanding shares of Series C
Preferred Stock are converted into or exchanged for shares of convertible
preferred stock of a corporation succeeding to the business of the Company,
which convertible preferred stock has powers, preferences and relative,
participating, optional or other rights, and qualifications, limitations and
restrictions substantially similar to those of the Series C Preferred Stock.
"Current Market Price" shall mean, for purposes of any computation
under the above section entitled "Conversion," the average of the daily Closing
Prices per share of Common Stock on the day in question and the next two
succeeding Trading Days, and for purposes of any other computation hereunder,
the average of the daily Closing Prices per share of Common Stock for the ten
consecutive Trading Days immediately prior to the date in question; provided,
however, that (1) if the "ex" date (as hereinafter defined) for any event (other
than the issuance, distribution or Fundamental Change requiring such
computation) that requires an adjustment to the Conversion Price occurs during
the applicable measurement period, for purposes of such computation the Closing
Price for each Trading Day prior to the "ex" date for such other event shall be
adjusted by multiplying such Closing Price by the same fraction by which the
Conversion Price is so required to be adjusted as a result of such other event,
(2) if the "ex" date for any event (other than the issuance, distribution or
Fundamental Change requiring such computation) that requires an adjustment to
the Conversion Price occurs on or after the "ex" date for the issuance,
distribution or Fundamental Change requiring such computation and on or prior to
the day in question, for purposes of such computation the Closing Price for each
Trading Day on and after the "ex" date for such other event shall be adjusted by
multiplying such Closing Price by the reciprocal of the fraction by which the
Conversion Price is so required to be adjusted as a result of such other event,
and (3) if the "ex" date for the issuance, distribution or Fundamental Change
requiring such computation is on or prior to the day in question, for purposes
of such computation, after taking into account any adjustment required pursuant
to clause (1) or (2) of this proviso, the Closing Price for each Trading Day on
or after such "ex" date shall be adjusted by adding thereto the amount of any
cash and the Fair Market Value (as determined by the Board of Directors in a
manner consistent with any determination of such value for purposes of the above
section entitled "Conversion," whose determination shall be conclusive and
described in a resolution of the Board of Directors) of the evidences of
indebtedness, shares of capital stock or assets being distributed applicable to
one share of Common Stock as of the close of business on the day before such
"ex" date. For purposes of this paragraph, the term "ex" date, (1) when used
with respect to any issuance or distribution, means the first date on which the
Common Stock trades regular way on the relevant exchange or in the relevant
market from which the Closing Price was obtained without the right to receive
such issuance or distribution, (2) when used with respect to any subdivision or
combination of shares of Common Stock, means the first date on which the Common
Stock trades regular way on such exchange or in such market after the time at
which such subdivision or combination becomes effective, and (3) when used with
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respect to any tender or exchange offer means the first date on which the Common
Stock trades regular way on such exchange or in such market after the Expiration
Time of such offer.
"Fair Market Value" shall mean the amount which a willing buyer would
pay a willing seller in an arm's length transaction.
"Full Cumulative Dividends" shall mean, with respect to the Series C
Preferred Stock, or any other capital stock of the Company, as of any date the
amount of accumulated, accrued and unpaid dividends payable on such shares of
Series C Preferred Stock, or other capital stock, as the case may be, whether or
not earned or declared and whether or not there shall be funds legally available
for the payment thereof.
"Fundamental Change" shall mean the occurrence of any transaction or
event or series of transactions or events pursuant to which all or substantially
all of the Common Stock of the Company shall be exchanged for, converted into,
acquired for or shall constitute solely the right to receive cash, securities,
property or other assets (whether by means of an exchange offer, liquidation,
tender offer, consolidation, merger, combination, reclassification,
recapitalization or otherwise); provided, however, in the case of any such
series of transactions or events, for purposes of adjustment of the conversion
price, such Fundamental Change shall be deemed to have occurred when
substantially all of the Common Stock of the Company shall have been exchanged
for, converted into, or acquired for, or shall constitute solely the right to
receive, such cash, securities, property or other assets, but the adjustment
shall be based upon the consideration that the holders of Common Stock received
in the transaction or event as a result of which more than 50% of the Common
Stock of the Company shall have been exchanged for, converted into, or acquired
for, or shall constitute solely the right to receive, such cash, securities,
property or other assets; and provided, further, that such term does not include
(i) any such transaction or event in which the Company and/or any of its
subsidiaries are the issuers of all the cash, securities, property or other
assets exchanged, acquired or otherwise issued in such transaction or event, or
(ii) any such transaction or event in which the holders of Common Stock receive
securities of an issuer other than the Company if, immediately following such
transaction or event, such holders hold a majority of the securities having the
power to vote normally in the election of directors of such other issuer
outstanding immediately following such transaction or other event.
"Non-Stock Fundamental Change" shall mean any Fundamental Change other
than a Common Stock Fundamental Change.
"Purchaser Stock Price" shall mean, with respect to any Common Stock
Fundamental Change, the average of the reported last sale price for one share of
the common stock received by holders of Common Stock (determined as provided in
the Certificate of Designations) in such Common Stock Fundamental Change during
the 10 Trading Days immediately prior to the date fixed for the determination of
the holders of Common Stock entitled to receive such common stock or, if there
is no such date, prior to the date upon which the holders of the Common Stock
shall have the right to receive such common stock.
"Record Date" shall mean, with respect to any dividend, distribution or
other transaction or event in which the holders of Common Stock have the right
to receive any cash, securities or other property or in which the Common Stock
(or other applicable security) is exchanged or converted into any combination of
cash, securities or other property, the date fixed for determination of
stockholders entitled to receive such cash, securities of other property
(whether such dated is fixed by the Board of Directors or by statute, contract
or otherwise), and with respect to any subdivision or combination of the Common
Stock, the effective date of such subdivision or combination.
"Reference Market Price" shall initially mean $13.8333 and, in the
event of any adjustment to the conversion price other than as a result of a
Fundamental Change, the Reference Market Price shall also be adjusted so that
the ratio of the Reference Market Price to the conversion price after giving
effect to any such adjustment shall always be the same as the ratio of the
initial Reference Market Price to the initial conversion price of $25.9375 per
share.
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"Trading Day" shall mean (x) if the applicable security is listed or
admitted for trading on the New York Stock Exchange or another national
securities exchange, a day on which the New York Stock Exchange or another
national securities exchange is open for business or (y) if the applicable
security is quoted on the National Market System of the National Association of
Securities Dealers Automated Quotation System, a day on which trades may be made
on such National Market System or (z) if the applicable security is not so
listed, admitted for trading or quoted, any day other than a Saturday or 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.
"Transfer Agent" shall mean State Street Bank and Trust Company, or any
other national or state bank or trust company having combined capital and
surplus of at least $100,000,000 and designated by the Company as the transfer
agent and/or registrar of the Series C Preferred Stock, or if no such
designation is made, the Company.
Series D Preferred Stock
Ranking
The Series D Preferred Stock ranks senior to the Common Stock, junior
to the Series A Preferred Stock and the Series C Preferred Stock, and on a
parity with the Series E Preferred Stock, with respect to the payment of
dividends and upon liquidation, dissolution or winding up, provided that the
Series D Preferred Stock shall so rank on a parity with the Series C Preferred
Stock at such times as there shall be no shares of Series A Preferred Stock
outstanding. The Company may not, without the consent of two-thirds of the votes
of the holders of the outstanding shares of Series D Preferred Stock and all
other outstanding shares of Preferred Stock ranking on a parity with the Series
D Preferred Stock either as to dividends or upon liquidation, dissolution or
winding up, voting together as a single class, create, authorize or issue, or
reclassify any authorized stock of the Company into, or create, authorize or
issue any obligation or security convertible into or evidencing a right to
purchase, any shares of any class of stock of the Company ranking prior to the
Series D Preferred Stock or ranking prior to any other series of Preferred Stock
which ranks on a parity with the Series D Preferred Stock. However, the Company
may create additional classes of stock or issue series of Preferred Stock
ranking on a parity with the Series D Preferred Stock with respect to the
payment of dividends or upon liquidation, dissolution and winding up without the
consent of any holder of Series D Preferred Stock.
Dividends
Holders of shares of the Series D Preferred Stock are entitled to
receive, when and as declared by the Board of Directors of the Company out of
assets of the Company legally available for payment, cash dividends at an annual
rate of $1.8138 per share of Series D Preferred Stock, payable in arrears on
January 1, April 1, July 1 and October 1 of each year commencing January 1,
1996. Each dividend is payable to holders of record as they appear on the stock
register of the Company on a record date, not more than 60 nor less than 10 days
before the payment date, fixed by the Board of Directors of the Company.
Dividends are cumulative and accrue on a daily basis from the date of original
issuance of the Series D Preferred Stock. Dividends payable on the Series D
Preferred Stock for each full quarterly dividend period are computed by
annualizing the dividend rate and dividing by four. Dividends payable for any
period greater or less than a full dividend period are computed on the basis of
a 360-day year consisting of twelve 30-day months. The Series D Preferred Stock
is not entitled to any dividend, whether payable in cash, property or stock, in
excess of Full Cumulative Dividends. No interest, or sum of money in lieu of
interest, is payable in respect of any accrued and unpaid dividends.
Unless Full Cumulative Dividends on all outstanding shares of any
series of Preferred Stock ranking senior to the Series D Preferred Stock have
been paid or declared and set aside for payment for all past dividend payment
periods, no dividend may be declared on shares of the Series D Preferred Stock
(other than a dividend paid in stock ranking junior to any series of Preferred
Stock ranking senior to the Series D Preferred Stock as to dividends), nor may
shares of the Series D Preferred Stock be redeemed or purchased by the Company
nor any sinking fund payment made for such redemption or purchase (other than a
purchase or redemption made by issue or delivery of stock ranking
junior to any series of Preferred Stock ranking senior to the
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Series D Preferred Stock as to dividends, or upon liquidation, dissolution or
winding up). Unless Full Cumulative Dividends on all outstanding shares of the
Series D Preferred Stock have been paid or declared and set aside for payment
for all past dividend payment periods, no dividend (other than a dividend paid
in stock ranking junior to the Series D Preferred Stock as to dividends) may be
declared on any stock ranking junior to the Series D Preferred Stock as to
dividends, nor may any stock ranking junior to the Series D Preferred Stock as
to dividends or upon liquidation, dissolution or winding up be redeemed or
purchased by the Company nor any sinking fund payment made for such redemption o
r purchase (other than a purchase or redemption made by issue or
delivery of stock ranking junior to the Series D Preferred Stock as to dividends
or upon liquidation, dissolution or winding up); provided that, unless
prohibited by the terms of any other outstanding series of Preferred Stock, any
monies theretofore deposited in any sinking fund with respect to any Preferred
Stock in compliance with the terms thereof may thereafter be applied in
accordance with the terms thereof. If dividends on Series D Preferred Stock and
on any other series of Preferred Stock ranking on a parity as to dividends with
the Series D Preferred Stock are in arrears, any dividend payment on account of
such arrearage must be made ratably upon all outstanding shares of the Series D
Preferred Stock and such other series of Preferred Stock in proportion to the
respective amounts of Full Cumulative Dividends.
Liquidation Rights
In the event of any voluntary or involuntary liquidation, dissolution
or winding up of the Company (not including mergers, consolidations or sales of
all or substantially all assets), before any payment or distribution of assets
is made to holders of the Series D Preferred Stock upon liquidation, dissolution
or winding up, the holders of each class or series of Preferred Stock ranking
senior to the Series D Preferred Stock shall be entitled to receive full payment
of their liquidation preferences. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Company, before any payment or
distribution of assets is made to holders of Common Stock or any other stock of
the Company ranking junior to the shares of Series D Preferred Stock upon
liquidation, dissolution or winding up, the holders of Series D Preferred Stock
shall receive a liquidation preference of $100 per share and shall be entitled
to receive all accrued and unpaid dividends through the date of distribution,
and the holders of any class or series of Preferred Stock ranking on a parity
with the Series D Preferred Stock as to liquidation, dissolution or winding up
shall be entitled to receive the full respective liquidation preferences
(including any premium) to which they are entitled and shall receive all accrued
and unpaid dividends with respect to their respective shares through and
including the date of distribution. If, upon such a voluntary or involuntary
liquidation, dissolution or winding up of the Company, the assets of the Company
are insufficient to pay in full the amounts described above as payable with
respect to the Series D Preferred Stock and any class or series of Preferred
Stock of the Company ranking on a parity with the Series D Preferred Stock as to
liquidation, dissolution or winding up, the holders of the Series D Preferred
Stock and of such other class or series of Preferred Stock will share ratably in
any such distribution of assets of the Company first in proportion to their
respective liquidation preferences until such preferences are paid in full, and
then in proportion to their respective amounts of accrued but unpaid dividends.
After payment of any such liquidating preference and accrued dividends, the
shares of Series D Preferred Stock will not be entitled to any further
participation in any distribution of assets by the Company. Neither the sale of
all or substantially all the assets of the Company, nor the merger or
consolidation of the Company into or with any other corporation, will be deemed
to be a liquidation, dissolution or winding up of the Company.
Mandatory Redemption in Event of Sale
Shares of the Series D Preferred Stock are subject to mandatory
redemption in the following circumstances. If at any time not less than 10
Business Days before November 17, 1996 the Company shall consummate any Sale
(defined as a sale of all or substantially all of the assets or stock of an
operating division or subsidiary of the Company other than TJ Maxx or Marshall's
at a value of not less than a $25 million premium over the book value of such
assets or stock), then the Company shall apply the full amount of the Sale
Proceeds (defined as the net cash proceeds, if any (after subtracting all fees
and expenses related to such transaction), received by the Company in respect of
any Sale) received by the Company in respect of such Sale to redeem all then
outstanding shares of Series D Preferred Stock (or, if fewer, as many such
shares as can be redeemed at the Call Price out of such Sale Proceeds). Upon any
such redemption, the Company shall deliver to the holders of shares of Series D
Preferred Stock, in exchange for each
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share so redeemed, cash in an amount equal to the sum of (i) $100 per share plus
(ii) Full Cumulative Dividends thereon to the date fixed for redemption. If
fewer than all of the outstanding shares of the Series D Preferred Stock are to
be redeemed, shares to be redeemed shall be selected by the Company from
outstanding shares of this Series not previously redeemed by lot or pro rata (as
nearly as may be practicable) or by any other method determined by the Board of
Directors of the Company in its sole discretion to be equitable.
Notice of redemption will be given by mail, not less than 10 nor more
than 60 days prior to the date fixed for redemption thereof, to each record
holder of the shares of Series D Preferred Stock to be redeemed at the address
of such holder in the stock register of the Company; provided, however, that
failure to give such notice or any defect therein shall not affect the validity
of the proceeding for redemption of any of the shares of the Series D Preferred
Stock. If a notice of redemption has been given, from and after the specified
redemption date (unless the Company defaults in making payment of the redemption
price), such shares will be no longer be deemed to be outstanding, dividends on
the Series D Preferred Stock so called for redemption will cease to accrue
(provided that holders of shares of Series D Preferred Stock at the close of
business on a record date for any payment of dividends shall be entitled to
receive Full Cumulative Dividends 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 of the
holders thereof as stockholders of the Company (except the right to receive the
redemption price) will cease.
Voting Rights
Except as indicated below or as expressly required by applicable law,
the holders of the Series D Preferred Stock have no voting rights.
If the equivalent of six full quarterly dividends payable on the Series
D Preferred Stock are in arrears, the maximum authorized number of directors of
the Company will be increased by two and the holders of Series D Preferred
Stock, voting separately as a class with the holders of shares of any other
series of Preferred Stock ranking on a parity with the Series D Preferred Stock
and upon which like voting rights have been conferred and are exercisable, will
be entitled to elect two directors for successive one-year terms until all
dividends in arrears on the Series D Preferred Stock have been paid or declared
and set apart for payment. Upon payment or declaration and setting apart of
funds for payment of all such dividends in arrears, the term of office of each
director elected will immediately terminate and the number of directors
constituting the entire Board of Directors of the Company will be reduced by the
number of directors elected by the holders of the Series D Preferred Stock and
any other series of Preferred Stock ranking on a parity with the Series D
Preferred Stock as discussed above.
The Company may not, without the affirmative vote or consent of
two-thirds of the votes of the holders of the Series D Preferred Stock and each
other series of Preferred Stock ranking on a parity with the Series D Preferred
Stock and upon which like voting rights have been conferred (voting together as
a single class), create, authorize or issue, or reclassify any authorized stock
of the Company into, or create, authorize or issue any obligation or security
convertible into or evidencing a right to purchase, any shares of any class of
stock of the Company ranking prior to the Series D Preferred Stock or any other
series of Preferred Stock which ranks on a parity with the Series D Preferred
Stock. The Company may not, without the affirmative vote or consent of
two-thirds of the votes of the holders of the outstanding shares of the Series D
Preferred Stock and each other series of Preferred Stock of the Company
similarly affected, if any, voting together as a single class, amend, alter or
repeal any provision of the Certificate which would materially and adversely
affect the preferences, rights, powers or privileges, qualification, limitations
and restrictions of the Series D Preferred Stock and any such other series of
Preferred Stock; provided, however, that the creation, issuance or increase in
the amount of authorized shares of any other series of Preferred Stock ranking
on a parity with or junior to the Series D Preferred Stock with respect to the
payment of dividends or the distribution of assets upon liquidation, dissolution
or winding up of the affairs of the Company will not be deemed to materially and
adversely affect such rights and preferences, privileges or voting powers.
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Conversion
On November 17, 1996 (the "Automatic Conversion Date"), unless earlier
converted at the option of the holder, each outstanding share of the Series D
Preferred Stock shall convert automatically (the "Automatic Conversion") into
(i) shares of Common Stock at the Exchange Rate in effect on the Automatic
Conversion Date and (ii) the right to receive an amount in cash equal to Full
Cumulative Dividends on such share to the Automatic Conversion Date.
Shares of Series D Preferred Stock may be converted, in whole or in
part, at the option of the holder thereof ("Optional Conversion"), at any time
after the giving of any notice of redemption by the Company and not later than
the close of business on the Business Day prior to November 17, 1996, into (i)
shares of Common Stock at the Exchange Rate in effect on the Optional Conversion
Date; and (ii) the right to receive an amount in cash equal to Full Cumulative
Dividends on such shares to the Optional Conversion Date; provided that only the
shares of Series D Preferred Stock that were subject to such notice of
redemption may be converted in an Optional Conversion. Notwithstanding the
foregoing, the Company may, at its option, in lieu of delivering shares of
Common Stock on the Optional Conversion Date, deliver cash in an aggregate
amount equal to the aggregate Closing Price (on the Trading Day preceding the
Optional Conversion Date) of the number of shares of Common Stock otherwise so
deliverable (together, in any event, with Full Cumulative Dividends thereon to
the Optional Conversion Date).
The Exchange Rate shall be subject to adjustment (under formulae set
forth in the Certificate of Designations) from time to time as appropriate in
certain circumstances, including if the Company shall (i) 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) to all
holders of Common Stock, (ii) subdivide its outstanding shares of Common Stock
into a greater number of shares of Common Stock or combine its outstanding
shares of Common Stock into a smaller number of shares of Common Stock, (iii)
issue certain 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 less than the Fair
Market Value of the Common Stock on the record date for the detemination of
stockholders entitled to receive such rights or warrants, or (iv) 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 Company other than Common Stock but excluding any cash dividends or other
distributions 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). Anything
in this paragraph notwithstanding, the Company shall be entitled to make such
upward adjustments in the Exchange Rate, in addition to those required by this
paragraph, as the Company 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 Company to
its stockholders shall not be taxable. All adjustments to the Exchange Rate
shall be calculated to the nearest 1/1,000,000th of a share of Common Stock. No
adjustment in the Exchange Rate shall be required unless such adjustment would
require an increase or decrease of at least one percent in the Exchange Rate;
provided, however, that any adjustments which by reason of the foregoing are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. All adjustments to the Exchange Rate shall be made
successively. Before taking any action that would cause an adjustment increasing
the Exchange Rate such that the conversion price (for purposes of this
paragraph, an amount equal to the liquidation value per share of Series D
Preferred Stock divided by the Upper Exchange Rate as in effect from time to
time) would be below the then par value of the Common Stock, the Company will
take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Company may validly and legally issue fully paid and
nonassessable shares of Common Stock at the Upper Exchange Rate as so adjusted.
In case of any consolidation or merger to which the Company is a party
(other than a merger or consolidation in which the Company 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
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property of the Company 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 D 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 Series D Preferred Stock would have been
converted if the conversion had occurred immediately prior to consummation of
such transaction (based on the Exchange Rate in effect immediately prior to such
consummation), (ii) conversion on the Automatic 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 Series D Preferred Stock would have been converted if the
conversion on the Automatic Conversion Date had occurred immediately prior to
the date of consummation of such transaction (based on the Exchange Rate in
effect immediately prior to such consummation) 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 of Series D
Preferred Stock immediately prior to consummation of such transaction; 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 nonelecting 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 D Preferred
Stock shall be convertible after consummation of such transaction shall be
subject to adjustment as described above following the date of consummation of
such transaction. The Company may not become a party to any such transaction
unless the terms thereof are consistent with the foregoing.
Definitions
The following terms shall have the meanings indicated in respect of the
Series D Preferred Stock:
"Base Number" shall mean the number derived from dividing $100 by
$15.4375.
"Business Day" shall mean any day other than a Saturday, Sunday, or a
day on which banking institutions in the State of New York or The Commonwealth
of Massachusetts are authorized or obligated by law or executive order to close
or a day which is or is declared a national or New York or Massachusetts state
holiday.
"Call Price" of each share of Series D Preferred Stock shall mean $100
per share.
"Closing Price" with respect to any securities 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 such security
is not listed or admitted to trading on such Exchange, on the principal national
securities exchange or quotation system on which such security is quoted or
listed or admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation system, the average of
the closing bid and asked prices of such security 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 for that purpose.
"Current Market Price" shall mean the average of the daily Closing
Prices per share of Common Stock for the ten consecutive Trading Days
immediately prior to the date in question; provided, however, that, if any event
that results in an adjustment of the Exchange Rate occurs during the period
beginning on the first day of such ten-day period and ending on the applicable
conversion or redemption date, the Current Market Price as determined pursuant
to the foregoing shall be appropriately adjusted to reflect the occurrence of
such event.
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"Dividend Payment Date" shall mean January 1, April 1, July 1 and
October 1 in each year commencing on the first of such four dates which follows
the date of initial issuance of the Series D Preferred Stock.
The "Exchange Rate" shall be equal to (a) if the Current Market Price
on the date of determination is equal to or greater than 120% of $15.4375 (the
"Threshold Common Stock Price"), the number of shares of Common Stock equal to
0.83333333 of the Base Number (the "Upper Exchange Rate"), (b) if the Current
Market Price on the date of determination is less than the Threshold Common
Stock Price but greater than 80% of $15.4375, the number of shares of Common
Stock having a value (determined at the Current Market Price) equal to $100 per
share of Series D Preferred Stock (the "Middle Exchange Rate"), and (c) if the
Current Market Price on the date of determination is equal to or less than 80%
of $15.4375, a number of shares of Common Stock (the "Lower Exchange Rate")
equal to 1.25 multiplied by the Base Number. The Exchange Rate is subject to
adjustment as set forth in the above section entitled "Conversion."
"Fair Market Value" on any day shall mean the average of the daily
Closing Prices of a share of Common Stock of the Company on the five (5)
consecutive Trading Days selected by the Company commencing not more than 20
Trading Days before, and ending not later than, the earlier of the day in
question and the day before the "ex" date with respect to the issuance or
distribution requiring such computation. The term "'ex' date", when used with
respect to any issuance or distribution, means the first day on which the Common
Stock trades regular way, without the right to receive such issuance or
distribution, on the exchange or in the market, as the case may be, used to
determine that day's Closing Price.
"Full Cumulative Dividends" shall mean, with respect to the Series D
Preferred Stock, or any other capital stock of the Company, as of any date the
aggregate amount of all then accumulated, accrued and unpaid dividends payable
on such shares of Series D Preferred Stock, or other capital stock, as the case
may be, in cash, whether or not earned or declared and whether or not there
shall be funds legally available for the payment thereof.
"Trading Day" shall mean (x) if the applicable security is listed or
admitted for trading on the New York Stock Exchange or another national
securities exchange, a day on which the New York Stock Exchange or such other
national securities exchange is open for business or (y) if the applicable
security is quoted on the National Market System of the National Association of
Securities Dealers Automated Quotation System, a day on which trades may be made
on such National Market System or (z) if the applicable security is not so
listed, admitted for trading or quoted, any day other than a Saturday or 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.
Series E Preferred Stock
Ranking
The Series E Preferred Stock ranks senior to the Common Stock, junior
to the Series A Preferred Stock and the Series C Preferred Stock, and on a
parity with the Series D Preferred Stock, with respect to the payment of
dividends and upon liquidation, dissolution or winding up. The Series E
Preferred Stock shall so rank on a parity with the Series C Preferred Stock at
such times as there shall be no shares of Series A Preferred Stock outstanding.
The Company may not, without the consent of two-thirds of the votes of the
holders of the outstanding shares of Series E Preferred Stock and all other
outstanding shares of Preferred Stock ranking on a parity with the Series E
Preferred Stock either as to dividends or upon liquidation, dissolution or
winding up, voting together as a single class, create, authorize or issue, or
reclassify any authorized stock of the Company into, or create, authorize or
issue any obligation or security convertible into or evidencing a right to
purchase, any shares of any class of stock of the Company ranking prior to the
Series E Preferred Stock or ranking prior to any other series of Preferred Stock
which ranks on a parity with the Series E Preferred Stock. However, the Company
may create additional classes of stock or issue series of Preferred Stock
ranking on a parity with the Series E Preferred Stock with respect to the
payment of dividends or upon liquidation, dissolution and winding up without the
consent of any holder of Series E Preferred Stock.
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Dividends
Holders of shares of the Series E Preferred Stock are entitled to
receive, when and as declared by the Board of Directors of the Company out of
assets of the Company legally available for payment, cash dividends at an annual
rate of $7.00 per share of Series E Preferred Stock, payable in arrears on
January 1, April 1, July 1 and October 1 of each year commencing January 1,
1996. Each dividend is payable to holders of record as they appear on the stock
register of the Company on a record date, not more than 60 nor less than 10 days
before the payment date, fixed by the Board of Directors of the Company.
Dividends are cumulative and accrue on a daily basis from the date of original
issuance of the Series E Preferred Stock. Dividends payable on the Series E
Preferred Stock for each full quarterly dividend period are computed by
annualizing the dividend rate and dividing by four. Dividends payable for any
period greater or less than a full dividend period are computed on the basis of
a 360-day year consisting of twelve 30-day months. The Series E Preferred Stock
is not entitled to any dividend, whether payable in cash, property or stock, in
excess of Full Cumulative Dividends. No interest is payable in respect of any
accrued and unpaid dividends.
Unless Full Cumulative Dividends on all outstanding shares of any
series of Preferred Stock ranking senior to the Series E Preferred Stock have
been paid or declared and set aside for payment for all past dividend payment
periods, no dividend may be declared on shares of the Series E Preferred Stock
(other than a dividend paid in stock ranking junior to any series of Preferred
Stock ranking senior to the Series E Preferred Stock as to dividends), nor may
shares of the Series E Preferred Stock be redeemed or purchased by the Company
nor any sinking fund payment made for such redemption or purchase (other than a
purchase or redemption made by issue or delivery of stock ranking
junior to any Series of Preferred Stock ranking senior to the Series E Preferred
Stock as to dividends, or upon liquidation, dissolution or winding up). Unless
Full Cumulative Dividends on all outstanding shares of the Series E Preferred
Stock have been paid or declared and set aside for payment for all past dividend
payment periods, no dividend (other than a dividend paid in stock ranking junior
to the Series E Preferred Stock as to dividends) may be declared on any stock
ranking junior to the Series E Preferred Stock as to dividends, nor may any
stock ranking junior to the Series E Preferred Stock as to dividends or upon
liquidation, dissolution or winding up be redeemed or purchased by the Company
nor any sinking fund payment made for such redemption or purchase (other than a
purchase or redemption made by issue or delivery of stock ranking
junior to the Series E Preferred Stock as to dividends or upon liquidation,
dissolution or winding up); provided that, unless prohibited by the terms of any
other outstanding series of Preferred Stock, any monies theretofore deposited in
any sinking fund with respect to any Preferred Stock in compliance with the
terms thereof may thereafter be applied in accordance with the terms thereof. If
dividends on Series E Preferred Stock and on any other series of Preferred Stock
ranking on a parity as to dividends with the Series E Preferred Stock are in
arrears, any dividend payment on account of such arrearage must be made ratably
upon all outstanding shares of the Series E Preferred Stock and such other
series of Preferred Stock in proportion to the respective amounts of Full
Cumulative Dividends.
Liquidation Rights
In the event of any voluntary or involuntary liquidation, dissolution
or winding up of the Company (not including mergers, consolidations and sale of
all or substantially all assets), before any payment or distribution of assets
(whether from capital or surplus) is made to holders of the Series E Preferred
Stock upon liquidation, dissolution or winding up, the holders of each class or
series of Preferred Stock ranking senior to the Series E Preferred Stock upon
liquidation, dissolution or winding up shall be entitled to receive full payment
of their liquidation preferences. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Company, before any payment or
distribution of assets (whether from capital or surplus) is made to holders of
Common Stock or any other stock of the Company ranking junior to the shares of
Series E Preferred Stock upon liquidation, dissolution or winding up, the
holders of Series E Preferred Stock shall receive a liquidation preference of
$100 per share and shall be entitled to receive all accrued and unpaid dividends
through the date of distribution, and the holders of any class or series of
Preferred Stock ranking on a parity with the Series E Preferred Stock as to
liquidation, dissolution or winding up shall be entitled to receive the full
respective liquidation preferences (including any premium) to which they are
entitled and shall receive all accrued and unpaid dividends with respect to
their respective shares through and including the date of distribution. If, upon
such a voluntary or involuntary liquidation, dissolution or winding up of the
Company, the assets of the Company are insufficient to pay in full the amounts
described above
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as payable with respect to the Series E Preferred Stock and any class or series
of Preferred Stock of the Company ranking on a parity with the Series E
Preferred Stock as to liquidation, dissolution or winding up, the holders of the
Series E Preferred Stock and of such other class or series of Preferred Stock
will share ratably in any such distribution of assets of the Company first in
proportion to their respective liquidation preferences until such preferences
are paid in full, and then in proportion to their respective amounts of accrued
but unpaid dividends. After payment of any such liquidating preference and
accrued dividends, the shares of Series E Preferred Stock will not be entitled
to any further participation in any distribution of assets by the Company.
Neither the sale of all or substantially all the assets of the Company, nor the
merger or consolidation of the Company into or with any other corporation, will
be deemed to be a liquidation, dissolution or winding up of the Company.
Redemption
Shares of the Series E Preferred Stock are not redeemable.
Voting Rights
Except as indicated below or as expressly required by applicable law,
holders of Series E Preferred Stock have no voting rights.
If the equivalent of six full quarterly dividends payable on the Series
E Preferred Stock are in arrears, the maximum authorized number of directors of
the Company will be increased by two and the holders of Series E Preferred
Stock, voting separately as a class with the holders of shares of any other
series of Preferred Stock ranking on a parity with the Series E Preferred Stock
and upon which like voting rights have been conferred and are exercisable, will
be entitled to elect two directors for successive one-year terms until all
dividends in arrears on the Series E Preferred Stock have been paid or declared
and set apart for payment. Upon payment or declaration and setting apart of
funds for payment of all such dividends in arrears, the term of office of each
director elected will immediately terminate and the number of directors
constituting the entire Board of Directors of the Company will be reduced by the
number of directors elected by the holders of the Series E Preferred Stock and
any other series of Preferred Stock ranking on a parity with the Series E
Preferred Stock as discussed above.
The Company may not, without the affirmative vote or consent of
two-thirds of the votes of the holders of the Series E Preferred Stock and each
other series of Preferred Stock ranking on a parity with the Series E Preferred
Stock and upon which like voting rights have been conferred (voting together as
a single class), create, authorize or issue, or reclassify any authorized stock
of the Company into, or create, authorize or issue any obligation or security
convertible into or evidencing a right to purchase, any shares of any class of
stock of the Company ranking prior to the Series E Preferred Stock or any other
series of Preferred Stock which ranks on a parity with the Series E Preferred
Stock as to dividends or upon liquidation, dissolution or winding up. The
Company may not, without the affirmative vote or consent of two-thirds of the
votes of the holders of the outstanding shares of the Series E Preferred Stock
and each other series of Preferred Stock of the Company similarly affected, if
any, voting together as a single class, amend, alter or repeal any provision of
the Certificate which would materially and adversely affect the preferences,
rights, powers or privileges, qualification, limitations and restrictions of the
Series E Preferred Stock and any such other series of Preferred Stock; provided,
however, that the creation, issuance or increase in the amount of authorized
shares of any other series of Preferred Stock ranking on a parity with or junior
to the Series E Preferred Stock with respect to the payment of dividends or the
distribution of assets upon liquidation, dissolution or winding up of the
affairs of the Company will not be deemed to materially and adversely affect
such rights and preferences, privileges or voting powers.
Conversion
On November 17, 1998 (the "Automatic Conversion Date"), unless earlier
converted at the option of the holder, each outstanding share of the Series E
Preferred Stock shall convert automatically (the "Automatic Conversion") into
(i) shares of Common Stock at the Exchange Rate in effect on the Automatic
Conversion Date and
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(ii) the right to receive an amount in cash equal to Full Cumulative Dividends
on such share to the Automatic Conversion Date.
Shares of Series E Preferred Stock may be converted, in whole or in
part, at the option of the holder thereof ("Optional Conversion"), at any time
after November 17, 1995 and not later than the close of business on the Business
Day prior to November 17, 1998, into shares of Common Stock at the Upper
Exchange Rate.
The Exchange Rate shall be subject to adjustment (under formulae set
forth in the Certificate of Designations) from time to time as appropriate in
certain circumstances, including if the Company shall (i) 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) to all
holders of Common Stock, (ii) subdivide its outstanding shares of Common Stock
into a greater number of shares of Common Stock or combine its outstanding
shares of Common Stock into a smaller number of shares of Common Stock, (iii)
issue certain 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 less than the Fair
Market Value of the Common Stock on the record date for the detemination of
stockholders entitled to receive such rights or warrants, or (iv) 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 Company other than Common Stock but excluding any cash dividends or other
distributions referred to in clauses (i) or (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).
Notwithstanding the foregoing, there will be no adjustment in the event the
Company were to issue rights to purchase capital stock of the Company pursuant
to a shareholder rights agreement. Anything in this paragraph notwithstanding,
the Company shall be entitled to make such upward adjustments in the Exchange
Rate, in addition to those required by this paragraph, as the Company 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 Company to its stockholders shall not be taxable.
All adjustments to the Exchange Rate shall be calculated to the nearest
1/1,000,000th of a share of Common Stock. No adjustment in the Exchange Rate
shall be required unless such adjustment would require an increase or decrease
of at least one percent in the Exchange Rate; provided, however, that any
adjustments which by reason of the foregoing are not required to be made shall
be carried forward and taken into account in any subsequent adjustment. All
adjustments to the Exchange Rate shall be made successively. Before taking any
action that would cause an adjustment increasing the Exchange Rate such that the
conversion price (for purposes of this paragraph, an amount equal to the
liquidation value per share of Series E Preferred Stock divided by the Upper
Exchange Rate as in effect from time to time) would be below the then par value
of the Common Stock, the Company will take any corporate action which may, in
the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable shares of Common Stock at the
Upper Exchange Rate as so adjusted.
In case of any consolidation or merger to which the Company is a party
(other than a merger or consolidation in which the Company 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 Company 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 E
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 Series E
Preferred Stock would have been converted if the conversion had occurred
immediately prior to consummation of such transaction (based on the Exchange
Rate in effect immediately prior to such consummation) and (ii) conversion on
the Automatic 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 Series E Preferred
Stock would have been converted if the conversion on the Automatic Conversion
Date had occurred immediately prior to the date of consummation of such
transaction (based on the Exchange Rate
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in effect immediately prior to such consummation); 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 nonelecting 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 E Preferred Stock shall
be convertible after consummation of such transaction shall be subject to
adjustment as described above following the date of consummation of such
transaction. The Company may not become a party to any such transaction unless
the terms thereof are consistent with the foregoing.
Fractional Shares
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued upon conversion of Series E Preferred Stock. Instead of
any fractional share of Common Stock that would otherwise be issuable upon
conversion of any shares of Series E Preferred Stock, the Company shall pay a
cash adjustment in respect of such fractional interest in an amount equal to the
same fraction of the Closing Price of a share of Common Stock (or, if there is
no such Closing Price, the fair market value of a share of Common Stock, as
determined or prescribed by the Board of Directors) at the close of business on
the Trading Day immediately preceding the date of conversion.
Listing; Transfer Agent
The Company will apply to list the Series E Preferred Stock on the
NYSE. The transfer agent, registrar, dividend disbursing agent and redemption
agent for the Series E Preferred Stock will be State Street Bank and Trust
Company, subject to the right of the Company to designate another bank or trust
company having its principal office in the United States and having a combined
capital and surplus of at least $100,000,000 to assume some or all of such
functions.
Definitions
The following terms shall have the meanings indicated in respect of the
Series E Preferred Stock:
"Base Number" shall mean the number derived from dividing $100 by
$15.4375.
"Business Day" shall mean any day other than a Saturday, Sunday, or a
day on which banking institutions in the State of New York or The Commonwealth
of Massachusetts are authorized or obligated by law or executive order to close
or a day which is or is declared a national or New York or Massachusetts state
holiday.
"Closing Price" with respect to any securities 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 such security
is not listed or admitted to trading on such Exchange, on the principal national
securities exchange or quotation system on which such security is quoted or
listed or admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation system, the average of
the closing bid and asked prices of such security 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 for that purpose.
"Current Market Price" shall mean the average of the daily Closing
Prices per share of Common Stock for the ten consecutive Trading Days
immediately prior to the date in question; provided, however, that, if any event
that results in an adjustment of the Exchange Rate occurs during the period
beginning on the first day of such ten-day
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period and ending on the applicable conversion date, the Current Market Price as
determined pursuant to the foregoing shall be appropriately adjusted to reflect
the occurrence of such event.
"Dividend Payment Date" shall mean January 1, April 1, July 1 and
October 1 in each year commencing on the first of such four dates which follows
the date of initial issuance of the Series E Preferred Stock.
"Exchange Rate" shall be equal to (a) if the Current Market Price on
the date of determination is equal to or greater than 120% of $15.4375 (the
"Threshold Common Stock Price"), the number of shares of Common Stock equal to
0.83333333 of the Base Number (the "Upper Exchange Rate"), (b) if the Current
Market Price on the date of determination is less than the Threshold Common
Stock Price but greater than $15.4375, the number of shares of Common Stock
having a value (determined at the Current Market Price) equal to $100 per share
of Series E Preferred Stock (the "Middle Exchange Rate"), and (c) if the Current
Market Price on the date of determination is equal to or less than $15.4375, a
number of shares of Common Stock (the "Lower Exchange Rate") equal to the Base
Number; provided that for all purposes relating to Optional Conversion by a
holder pursuant to the above section entitled "Conversion," the Exchange Rate
shall be equal to the Upper Exchange Rate. The Exchange Rate is subject to
adjustment as set forth in the above section entitled "Conversion."
"Fair Market Value" on any day shall mean the average of the daily
Closing Prices of a share of Common Stock of the Company on the five (5)
consecutive Trading Days selected by the Company commencing not more than 20
Trading Days before, and ending not later than, the earlier of the day in
question and the day before the "ex" date with respect to the issuance or
distribution requiring such computation. The term "'ex' date", when used with
respect to any issuance or distribution, means the first day on which the Common
Stock trades regular way, without the right to receive such issuance or
distribution, on the exchange or in the market, as the case may be, used to
determine that day's Closing Price.
"Full Cumulative Dividends" shall mean, with respect to the Series E
Preferred Stock, or any other capital stock of the Company, as of any date the
aggregate amount of all then accumulated, accrued and unpaid dividends payable
on such shares of Series E Preferred Stock, or other capital stock, as the case
may be, in cash, whether or not earned or declared and whether or not there
shall be funds legally available for the payment thereof.
"Trading Day" shall mean (x) if the applicable security is listed or
admitted for trading on the New York Stock Exchange or another national
securities exchange, a day on which the New York Stock Exchange or such other
national securities exchange is open for business or (y) if the applicable
security is quoted on the National Market System of the National Association of
Securities Dealers Automated Quotation System, a day on which trades may be made
on such National Market System or (z) if the applicable security is not so
listed, admitted for trading or quoted, any day other than a Saturday or 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.
In connection with the Company's acquisition of the Marshall's division
from Melville Corporation ("Melville"), Melville acquired all shares of Series D
Preferred Stock and Series E Preferred Stock. The Company and Melville entered
into a Standstill and Registration Rights Agreement (the "Standstill and
Registration Rights Agreement") pursuant to which Melville agreed (i) not to
acquire any voting securities of the Company until such voting securities held
by Melville represent less than 3 percent of the total combined voting power of
all of the Registrant's outstanding voting securities (in which event the
Standstill and Registration Rights Agreement will terminate) and (ii) to vote
all voting securities of the Company held by it in the manner recommended by the
Company's Board of Directors or, if the agreement to so vote shall be prohibited
or invalid, then to vote such voting securities in the same proportion as the
votes cast on behalf of the other holders of the Company's voting securities.
The Standstill and Registration Rights Agreement also provides Melville with
certain rights of registration of securities of the Company which it holds under
the Securities Act of 1933.
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Certain Charter and By-Law Provisions
The Certificate and By-Laws contain various provisions that may impede
the acquisition of control of TJX by means of a tender offer, proxy fight or
other means. Such provisions include a classified Board of Directors,
restrictions on the ability of stockholders to remove directors, fill vacancies
or call a stockholder meeting, and restrictions on stockholder proposals and
amendment of certain charter and by-law provisions.
The TJX Certificate further provides that no director of the company
shall be liable to the Company or its stockholders for monetary damages for
breach of fiduciary duty as a director, except for liability (i) for any breach
of the director's duty of loyalty to the Company or its shareholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law or (iv) for any transaction from which the director derived an
improper personal benefit. Section 174 of the Delaware General Corporation Law
specifies conditions under which directors of Delaware corporations may be
liable for unlawful payment of dividends or unlawful stock purchases or
redemptions.
Section 203 of the Delaware General Corporation Law
As a Delaware corporation, TJX is subject to the provisions of Section
203 of the General Corporation Law of the State of Delaware. Section 203
generally provides that if a person or group acquires 15% or more of a
corporation's voting stock (thereby becoming an "interested stockholder")
without prior board approval, such interested stockholder may not, for a period
of three years, engage in a wide range of business combination transactions with
the corporation. However, this restriction does not apply to a person who
becomes an interested stockholder in a transaction resulting in the interested
stockholder owning at least 85% of the corporation's voting stock (excluding
from the outstanding shares, shares held by officer-directors or pursuant to
employee stock plans without confidential tender offer decisions), or to a
business combination approved by the board of directors and authorized by the
affirmative vote of at least 66 2/3% of the outstanding voting stock not owned
by the interested stockholder. In addition, Section 203 does not apply to
certain business combinations proposed subsequent to the public announcement of
specified business combination transactions which are not opposed by the board
of directors.
Item 2. Exhibits.
1. Second Restated Certificate of Incorporation filed June 5, 1985
(incorporated by reference to Exhibit (3i)(a) of the Form 10-K filed
for the fiscal year ended January 28, 1995).
2. Certificate of Amendment of Second Restated Certificate of
Incorporation filed June 3, 1986 (incorporated by reference to Exhibit
(3i)(b) of the Form 10-K for the fiscal year ended January 28, 1995).
3. Certificate of Amendment of Second Restated Certificate of
Incorporation filed June 2, 1987 (incorporated by reference to Exhibit
(3i)(c) of the Form 10-K for the fiscal year ended January 28, 1995).
4. Certificate of Amendment of Second Restated Certificate of
Incorporation filed June 20, 1989 (incorporated by reference to Exhibit
(3i)(d) of the Form 10-K for the fiscal year ended January 28, 1995).
5. Certificate of Designations, Preferences and Rights of New Series A
Cumulative Convertible Preferred Stock of the Company, filed August 12,
1992 (incorporated by reference to Exhibit (3i)(e) of the Form 10-K for
the fiscal year ended January 28, 1995).
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6. Certificate of Designations, Preferences and Rights of $3.125 Series C
Cumulative Convertible Preferred Stock (incorporated by reference to
Exhibit (3i)(f) of the Form 10-K for the fiscal year ended January 28,
1995).
7. Certificate of Designations, Preferences and Rights of Series D
Cumulative Convertible Preferred Stock (incorporated by reference to
Exhibit 10.1 of the Form 8-K dated November 17, 1995).
8. Certificate of Designations, Preferences and Rights of Series E
Cumulative Convertible Preferred Stock (incorporated by reference to
Exhibit 10.2 of the Form 8-K dated November 17, 1995).
9. The by-laws of the Company, as amended (incorporated by reference to
Exhibit (3ii) of the Form 10-K for the fiscal year ended January 28,
1995).
10. Share Purchase Agreement dated as of April 15, 1992 regarding Series A
Cumulative Convertible Preferred Stock (incorporated by reference to
Exhibit 4(c) of Form 10-K for the fiscal year ended January 30, 1993).
11. Exchange Agreement dated as of August 6, 1992 between the Company and
the former holders of the Company's Series A Cumulative Convertible
Preferred Stock (incorporated by reference to Exhibit 4(d) of the Form
10-K for the fiscal year ended January 30, 1993).
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12. Standstill and Registration Rights Agreement dated as of November 17,
1995 regarding Series D Cumulative Convertible Preferred Stock and
Series E Cumulative Convertible Preferred Stock dated as of November
17, 1995 between the Registrant and Melville Corporation (incorporated
by reference to Exhibit 10.20 of the Form 10-K for the fiscal year
ended January 27, 1996).
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this amendment to be signed on its
behalf by the undersigned, thereto duly authorized.
THE TJX COMPANIES, INC.
By /s/ Donald G. Campbell
Donald G. Campbell
Executive Vice President--Finance
Date: June 3, 1996
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