 |
RESTATED ARTICLES OF INCORPORATION
OF
GRACO INC.
(Approved by the Board of Directors of Graco Inc. on
April 24, 2009)
ARTICLE
I
 1. |
The
name of this corporation shall be Graco Inc. |
ARTICLE 2
| 2. |
Corporation
Service Company is this Corporation's registered
agent in the State of Minnesota, and 380 Jackson Street, Suite 700, St. Paul, Minnesota 55101,
the business office address of Corporation Service
Company, is the registered office of this Corporation. |
ARTICLE
3
| 3. |
Any action required or permitted to
be taken at a meeting of the Board of Directors of
this corporation not needing approval by the shareholders
under Minnesota Statutes, Chapter 302A, may be taken
by written action signed by the number of directors
that would be required to take such action at a meeting
of the Board of Directors at which all directors
are present. |
ARTICLE 4
| 4.1 |
(a) |
The total number of shares which this
corporation shall be authorized to issue is One Hundred
Million Twenty-two Thousand Five Hundred Forty-nine
(100,022,549) shares of which Ninety-seven Million (97,000,000)
shares of the par value of $1.00 per share shall be
Common Shares, Three Million (3,000,000) shares of the
par value of $1.00 per share shall be Preferred Shares
and Twenty-two Thousand Five Hundred Forty-nine (22,549)
shares of the par value of $100.00 per share shall be
Cumulative Preferred Shares. |
|
|
|
|
(b) |
Preferred Shares may be issued from time
to time in one or more series as the Board of Directors may
determine, as hereinafter provided. The Board of Directors
is hereby authorized by resolution or resolutions, to provide from
time to time for series of Preferred Shares out of the unissued
Preferred Shares not then allocated to any series of Preferred
Shares. Before any shares of any such series are issued,
the Board of Directors shall fix and determine, and is hereby
expressly empowered to fix and determine, by resolution or resolutions,
the designations and the relative rights and preferences thereof, of
the shares of such series. Preferred Shares will be senior to
the Cumulative Preferred Shares in terms of dividend and liquidation
rights unless the Board of Directors specifically provides otherwise
in the resolution or resolutions establishing a series of Preferred Shares.
The Board of Directors is expressly authorized to vary the
provisions relating to the foregoing matters among the various series of Preferred Shares.
Preferred Shares of any series that shall be issued and thereafter
acquired by the corporation through purchase, redemption (whether
through the operation of a sinking fund or otherwise), conversion,
exchange or otherwise, shall, upon appropriate filing and recording
to the extent required by law, have the status of authorized and unissued
Preferred Shares and may be reissued as part of such series or as
part of any other series of Preferred Shares. Unless otherwise
provided in the resolution or resolutions of the Board of Directors
providing for the issue thereof, the number of authorized shares of
any series of Preferred Shares may be increased or decreased (but
not below the number of shares thereof then outstanding) by resolution
or resolutions of the Board of Directors and appropriate filing and
recording to the extent required by law. In case the number
of shares of any such series of Preferred Shares shall be decreased,
the shares representing such decrease shall, unless otherwise provided
in the resolution or resolutions of the Board of Directors providing
for the issuance thereof, resume the status of authorized but unissued
Preferred Shares, undesignated as to series.
|
| 4.2 |
The
designations, relative rights, voting powers, preferences
and restrictions granted to or imposed upon the Common
Shares and Cumulative Preferred Shares, which shall
be subject to the rights granted to any series of
Preferred Shares in the resolutions authorizing the
series, are as follows: |
| |
(a) |
Voting. Except as expressly set forth in sub-division (f) below
and except as otherwise provided in the resolutions authorizing
any series of Preferred Shares or by law, the holders of Common
Shares shall have the sole voting rights of shareholders of the
corporation and shall be entitled to one vote for each share held.
The shareholders of the corporation shall have no right to cumulate
votes for the election of directors. |
|
|
|
|
(b) |
No Pre-emptive Rights. Except as provided
in the resolutions authorizing any series of Preferred Shares,
no holders of any share of stock of any class of this corporation
shall have any pre-emptive right to subscribe to any issue of
shares of any class of this corporation now or hereafter authorized
or any security hereafter issued by this corporation convertible
into shares of this corporation. |
|
|
|
|
(c) |
Dividends. The holders of Cumulative
Preferred Shares shall be entitled to receive out of any assets
legally available therefor, when and as declared by the Board of
Directors, fixed cumulative dividends at the rate of five percent
(5%) per annum upon the par value thereof, and no more, payable
semiannually on January 1 and July 1 of each year. Such dividends
shall be cumulative from January 1, 1969.
In no event shall any dividend be paid or declared (other than
dividends payable in Common Shares of any class), nor shall any
distribution be made on the Common Shares of any class of the
corporation, nor shall any Common Shares of any class be purchased,
redeemed or otherwise acquired by the corporation for value unless
all dividends on the Cumulative Preferred Shares for all past
semiannual dividend periods and for the then current semiannual
dividend period shall have been paid, or declared and a sum
sufficient for the payment thereof set apart for payment.
Subject to the provisions of this Article 4 and not otherwise,
dividends may be declared by the Board of Directors and paid from
time to time, out of any funds legally available therefor, upon
the Common Shares, and the holders of Cumulative Preferred Shares
shall not be entitled to participate in any such dividends. |
|
|
|
|
(d) |
Redemption. The Cumulative Preferred
Shares of the corporation may be redeemed as a whole at any time
or in part from time to time at the option of the corporation by
resolution of the Board of Directors at the redemption price of
$105 per share together with an amount equal to all accrued and
unpaid cumulative dividends thereon from the date on which dividends
thereon became cumulative to the redemption date. If less than all
of the outstanding Cumulative Preferred Shares are to be redeemed,
the shares to be redeemed shall be selected by the Board of Directors
or by a person appointed for such purpose by the Board of Directors.
Notice of every redemption of Cumulative Preferred Shares shall
be mailed addressed to the holders of record of the shares to be
redeemed at their respective addresses as they appear on the stock
books of the corporation not less than thirty (30) and not more
than sixty (60) days prior to the date fixed for redemption.
If notice of redemption shall have been duly given as aforesaid
and if on or before the redemption date specified in the notice,
all funds necessary for the redemption shall have been deposited
in trust with a bank or trust company in good standing and doing
business at any place within the United States, and designated in
the notice of redemption, for the pro rata benefit of the shares
so called for redemption, so as to be and continue to be available
therefor, then, from and after the date of such deposit, notwithstanding
that any certificate for Cumulative Preferred Shares so called for
redemption shall not have been surrendered for cancellation, the
shares represented thereby shall no longer be deemed outstanding,
and the dividends thereon shall cease to accumulate from and after
the date fixed for redemption, and all rights with respect to the
Cumulative Preferred Shares so called for redemption shall forthwith,
on the date of such deposit, cease and terminate except only the
right of the holders thereof to receive the redemption price of
the shares so redeemed, including accrued cumulative dividends
to the redemption date, but without interest. Any funds deposited
by the corporation pursuant to this paragraph and unclaimed at the
end of six (6) years after the date fixed for redemption shall be
repaid to the corporation upon its request expressed in a resolution
of its Board of Directors, after which repayment the holders of the
shares so called for redemption shall look only to the corporation
for the payment thereof. |
|
|
|
|
(e) |
Dissolution, Liquidation, etc. In the event
of any dissolution, liquidation or winding up of the affairs of the
corporation, before any distribution or payment shall be made to
the holders of Common Shares, the holders of the Cumulative Preferred
Shares shall be entitled to be paid in full the par value thereof if
such liquidation, dissolution or winding up shall be involuntary, and
the sum of $105 per share if such liquidation, dissolution or winding
up shall be voluntary, together, in either event, with a sum, in the
case of each share, equal to the cumulative accrued and unpaid dividends
thereon to the date fixed for such distribution or payment. If
such distribution or payment shall have been made to the holders of the
Cumulative Preferred Shares or moneys made available for such payment
in full, the remaining assets and funds of the corporation shall be
distributed ratably to the holders of the Common Shares. If there shall
be insufficient assets to make full payment to the holders of Cumulative
Preferred Shares as above provided, the assets of the corporation shall be
distributed among the holders of Cumulative Preferred Shares ratably.
Except as herein otherwise expressly provided, the Cumulative Preferred
Shares shall not be entitled to participate in any of the profits,
surplus or assets of the corporation. The consolidation or merger of
the corporation into or with any other corporation or corporations
pursuant to the statutes of the State of Minnesota shall not be deemed
a liquidation, dissolution or winding up of the affairs of the corporation
within the meaning of any of the provisions of this paragraph. |
|
|
|
|
(f) |
Special Voting Rights. The holders of
Cumulative Preferred Shares shall not be entitled as such to vote
at any meeting of the shareholders of the corporation except as
required by law or as hereinafter otherwise provided. |
| |
|
(i) |
If an amendment to the Articles of Incorporation
of the corporation would adversely affect the rights of the holders
of Cumulative Preferred Shares, then in addition to the vote thereon
by the holders of the Common Shares, the holders of Cumulative
Preferred Shares shall be entitled to vote separately as a class
thereon, and such amendment shall be adopted only if it receives
the affirmative vote of the holders of a majority of the Cumulative
Preferred Shares. |
|
|
|
|
|
|
(ii) |
After an amount equivalent to three (3) full
semi-annual dividend installments of the Cumulative Preferred
Shares shall be in default, the holders of Cumulative Preferred
Shares at the time outstanding, voting separately as a class shall,
at any annual meeting of the shareholders or any special meeting of
the shareholders called as herein provided occurring during such
period, elect two (2) members of the Board of Directors, and the
holders of the Common Shares, voting separately as a class, shall
elect the remaining directors of the corporation. |
|
|
|
|
|
|
(iii) |
After an amount equivalent to six (6) full
semi-annual dividend installments of the Cumulative Preferred
Shares shall be in default, the holders of Cumulative Preferred
Shares, voting separately as a class, shall, at any annual
meeting of the shareholders or any special meeting of the
shareholders called as herein provided occurring during such
period, elect the smallest number of directors necessary to
constitute a majority of the full Board of Directors, and the
holders of the Common Shares, voting separately as a class,
shall elect the remaining directors of the corporation. |
|
At any annual meeting or special meeting
of shareholders for the election of directors occurring after
all cumulative dividends then in default on the Cumulative
Preferred Shares then outstanding, including the dividend for
the then current semi-annual period, shall have been paid, or
declared and set apart for payment, the Cumulative Preferred
Shares shall thereupon be divested of any rights with respect
to the election of directors as above provided, but always
subject to the same provisions for the revesting of such voting
power in the Cumulative Preferred Shares in the case of a future
like default or defaults in dividends on Preferred Shares.
Voting power for the election of directors vested in the
holders of the Cumulative Preferred Shares as above provided
may be exercised at any annual meeting of shareholders or at
a special meeting of shareholders held for such purpose, which
special meeting of shareholders shall be called by the proper
officers of the corporation at any time when such voting power
shall be vested within twenty (20) days after written request
therefor signed by the holder or holders of not less than ten
percent (10%) of the Cumulative Preferred Shares then outstanding,
the date of such special meeting to be not more than twenty (20)
days from the date of giving notice thereof, and such notice shall
be given to all holders of Cumulative Preferred Shares and Common
Shares not less than ten (10) days prior to said meeting. In each
such case such notice shall direct attention to the voting rights
of the holders of Cumulative Preferred Shares. At any such meeting
the presence in person or by proxy of the holders of a majority of
the Cumulative Preferred Shares outstanding shall be required to
constitute a quorum for the election of directors whom the holders
of Cumulative Preferred Shares are entitled to elect and, likewise,
the presence in person or by proxy of the holders of a majority of
the Common Shares outstanding shall be required to constitute a
quorum for the election of directors whom the holder of Common
Shares are entitled to elect; provided that either the Cumulative
Preferred shareholders or the Common shareholders who are present
in person or by proxy at such a meeting shall have power to adjourn
such meeting for the election of directors to be elected by them
from time to time, without notice other than announcement at the
meeting and, provided further, that the adjournment of the meeting
for lack of a quorum of the Common shareholders shall not prevent
the election at that meeting of the directors whom the Cumulative
Preferred shareholders are entitled to elect if there is a quorum
of the Cumulative preferred shareholders.
If at any time the holders of Cumulative Preferred Shares shall
become entitled to elect two (2) directors or a majority of the
Board of Directors as aforesaid, the terms of all incumbent directors
shall expire whenever such two (2) directors or such majority have
been duly elected and qualified.
Whenever the Cumulative Preferred Shares shall be divested of
voting power with respect to the election of directors the terms
of all then incumbent directors shall expire upon the election of
a new board by the holders of Common Shares at the next annual
or special meeting for the election of directors.
If a vacancy or vacancies in the Board of Directors shall exist
with respect to a director or directors elected by the Cumulative
Preferred shareholders, the remaining director or directors elected
by the Cumulative Preferred shareholders may, by the vote of such
remaining director if there be but one, or by the vote of a majority
of such remaining directors if there be more than one, elect a
successor or successors to hold office for the unexpired term.
Likewise, a vacancy or vacancies existing with respect to directors
elected by the Common shareholders may be filled by the remaining
director or directors elected by the Common shareholders.
|
ARTICLE 5
| 5.1 |
Whether or not a vote of shareholders is otherwise
required, the affirmative vote of the holders of not less than two-thirds
of the outstanding shares of "Voting Stock" (as hereafter defined)
of the corporation shall be required for the approval or authorization
of any "Business Combination" (as hereafter defined) with any Related
Person (as hereafter defined) involving the corporation or the approval
or authorization by the corporation in its capacity as a shareholder
of any Business Combination involving a "Subsidiary" (as hereafter
defined) which requires the approval or authorization of the
shareholders of the Subsidiary; provided, however, that the two-thirds
voting requirement shall not be applicable if: |
|
(a) |
The
"Continuing Directors" (as hereafter defined) by a majority vote have
expressly approved the Business Combination; or |
|
|
|
|
(b) |
The Business Combination is a merger, consolidation,
exchange of shares or sale of all or substantially all of the
assets of the corporation and the cash or fair market value
(determined as of the effective date of such Business Combination
or, in the case of a sale of assets as of the date of the
distribution of the proceeds of the sale to the shareholders of
the corporation) of the property, securities or other consideration
to be received per share by holders of common stock of the corporation
other than the Related Person is not less than the highest per share
price (with appropriate adjustments for recapitalizations, stock splits,
stock dividends and like distributions), paid by the Related Person
in acquiring any of its holdings of the corporation's common stock
during the two-year period prior to the effective date of the Business
Combination or the distribution of the proceeds of a sale of assets. |
| 5.2 |
For the purposes of this Article 5: |
| |
(a) |
The
term "Business Combination" shall mean |
| |
|
(i) |
any merger or consolidation of the corporation
or a Subsidiary with or into a Related Person, |
|
|
|
|
|
|
(ii) |
any exchange of shares of the corporation or
a Subsidiary for shares of a Related Person which, in the
absence of this Article, would have required the affirmative
vote of at least a majority of the voting power of the
outstanding shares of the corporation entitled to vote or
the affirmative vote of the corporation, in its capacity
as a shareholder of the Subsidiary, |
|
|
|
|
|
|
(iii) |
any sale, lease, exchange, transfer or other
disposition (in one transaction or a series of transactions),
including, without limitation, a mortgage or any other security
device, of all or any "Substantial Part" (as hereinafter defined)
of the assets either of the corporation (including, without
limitation, any voting securities of a Subsidiary) or of a
Subsidiary, to or with a Related Person, |
|
|
|
|
|
|
(iv) |
any sale, lease, exchange, transfer or
other disposition (in one transaction or a series of
transactions) of all or any Substantial Part of the assets
of a Related Person to or with the corporation or a Subsidiary, |
|
|
|
|
|
|
(v) |
the issuance of any securities to a Related
Person (except pursuant to stock dividends, stock splits
or similar transactions which would not have the effect
of increasing the proportionate voting power of a Related
Person) of the corporation, or of a Subsidiary (except
pursuant to a pro rata distribution to all holders of
common stock of the corporation), |
|
|
|
|
|
|
(vi) |
any recapitalization or reclassification that
would have the effect of increasing the voting power of a Related Person, and |
|
|
|
|
|
|
(vii) |
any agreement, contract or other arrangement
providing for any of the transactions described in this
definition of Business Combination. |
| |
(b) |
The
term "Related Person" shall mean and include any individual,
corporation, partnership or other person or entity which, together
with its "Affiliates" and "Associates" (as defined on February 24,
1984 by Rule 12b-2 under the Securities Exchange Act of 1934),
"Beneficially Owns" (as defined on February 24, 1984 by Rule 13d-3
under the Securities Exchange Act of 1934) in the aggregate 15
percent or more of the outstanding Voting Stock of the corporation,
and any Affiliate or Associate (other than the corporation or a
wholly-owned subsidiary of the corporation) of any such individual,
corporation, partnership or other person or entity. |
|
|
|
|
(c) |
The term "Substantial Part" shall mean more than
30 percent of the fair market value of the total assets of
the corporation in question, as of the end of its most recent
fiscal year ending prior to the time the determination is being made. |
|
|
|
|
(d) |
Without limitation, any shares of common stock
of the corporation that any Related Person has the right to acquire
pursuant to any agreement, or upon exercise of conversion rights,
warrants or options, or otherwise, shall be deemed beneficially
owned by the Related Person. |
|
|
|
|
(e) |
The term "Subsidiary" shall mean any corporation,
a majority of the equity securities of any class of which are
owned by the corporation, by another Subsidiary, or in the
aggregate by the corporation and one or more of its Subsidiaries. |
|
|
|
|
(f) |
The term "Voting Stock" shall mean all
outstanding shares of capital stock of the corporation
entitled to vote generally in the election of directors
and each reference to a proportion of shares of Voting
Stock shall refer to such proportion of the votes entitled
to be cast by such shares. |
|
|
|
|
(g) |
The term "Continuing Director" shall mean (i)
a director who was a member of the Board of Directors of the
corporation either on February 24, 1984 or immediately prior
to the time that any Related Person involved in the Business
Combination in question became a Related Person and (ii) any
person becoming a director whose election, or nomination for
election by the corporation's shareholders, was approved by a
vote of a majority of the Continuing Directors; provided,
however, that in no event shall a Related Person involved in
the Business Combination in question be deemed to be a Continuing Director. |
| 5.3 |
For the purposes of this Article 5 the Continuing
Directors by a majority vote shall have the power to make a good
faith determination, on the basis of information known to them,
of: (i) the number of shares of Voting Stock of the corporation
that any person or entity Beneficially Owns, (ii) whether a
person or entity is an Affiliate or Associate of another, (iii)
whether the assets subject to any Business Combination constitute
a Substantial Part, (iv) whether any business transaction is one
in which a Related Person has an interest, (v) whether the cash
or fair market value of the property, securities or other
consideration to be received per share by holders of capital stock
of the corporation other than the Related Person in a Business
Combination is an amount at least equal to the highest per share
price paid by the Related Person and (vi) such other matters with
respect to which a determination is required under this Article 5. |
|
|
| 5.4 |
The provisions set forth in this Article 5 may
not be repealed or amended in any respect, unless such action
is approved by the affirmative vote of the holders of not less
than two-thirds of the outstanding shares of Voting Stock of the corporation. |
ARTICLE 6
| 6.1 |
The number of directors shall initially be
ten and, thereafter, shall be fixed from time to time by the
Board of Directors or by the affirmative vote of the holders
of two-thirds of the voting power of the outstanding capital
stock of the corporation, voting together as a single class.
The directors shall be divided into three classes, as nearly
equal in number as reasonably possible, with the term of office
of the first class to expire at the 1988 annual meeting of
shareholders, the term of office of the second class to expire
at the 1989 annual meeting of shareholders and the term of office
of the third class to expire at the 1990 annual meeting of shareholders.
At each annual meeting of shareholders following such initial
classification and election, directors elected to succeed those
directors whose terms expire shall be elected for a term of
office to expire at the third succeeding annual meeting of
shareholders after their election. |
|
|
| 6.2 |
Subject to the rights of the holders of
any series of Preferred Stock then outstanding, newly created
directorships resulting from any increase in the authorized
number of directors or any vacancies in the Board of Directors
resulting from death, resignation, retirement, disqualification,
removal from office or other cause may be filled by a majority
vote of the directors then in office though less than a quorum,
and directors so chosen shall hold office for a term expiring
at the next annual meeting of shareholders. No decrease in
the number of directors constituting the Board of Directors
shall shorten the term of any incumbent director. |
|
|
| 6.3 |
Any directors, or the entire Board of Directors,
may be removed from office at any time, but only for cause and only
by the affirmative vote of the holders of the proportion or number
of the voting power of the shares of the classes or series the
director represents sufficient to elect them. |
|
|
| 6.4 |
The provisions of this Article 6 may not be
repealed or amended in any respect, unless such action is
approved by the affirmative vote of the holders of not less
than two-thirds of the outstanding shares of the capital
stock of the corporation entitled to vote generally in the
election of directors, voting together as a single class. |
ARTICLE 7
| 7. |
No director of the corporation shall be
personally liable to the corporation or its shareholders
for monetary damages for breach of fiduciary duty by such
director as a director; provided, however, that this Article
7 shall not eliminate or limit the liability of a director
(i) for any breach of the director's duty of loyalty to the
corporation 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 302A.559
of the Minnesota Business Corporation Act or Section 80A.23
of the Minnesota Securities Law, or (iv) for any transaction
from which the director derived an improper personal benefit.
No amendment to or repeal of this Article 7 shall apply to or
have any effect on the liability or alleged liability of any
director of the corporation for or with respect to any acts
or omissions of such director occurring prior to such amendment or repeal. |
ARTICLE 8
| 8. |
The Board of Directors of the corporation
(the "Board"), when evaluating any offer of another party,
(a) to make a tender or exchange offer for any Voting Stock
(as defined in Article 5) of the corporation or (b) to effect
a Business Combination (as defined in Article 5), shall, in
connection with the exercise of its judgment in determining
what is in the best interests of the corporation as a whole,
be authorized to give due consideration to such factors as
the Board determines to be relevant, including, without limitation: |
| |
|
(i) |
the interests of the corporation's
shareholders; |
|
|
|
|
|
|
(ii) |
the social, legal and economic effects upon
employees, suppliers, customers and others having similar
relationships with the corporation, and the communities
in which the corporation conducts its business; |
|
|
|
|
|
|
(iii) |
whether the proposed transaction might
violate federal or state laws; and |
|
|
|
|
|
|
(iv) |
not only the consideration being offered
in the proposed transaction, in relation to the then current
market price for the outstanding capital stock of the corporation,
but also the market price for the capital stock of the corporation
over a period of years, the estimated price that might be achieved
in a negotiated sale of the corporation as a whole or in part of
through orderly liquidation, the premiums over market price for
the securities of other corporations in similar transactions,
current political, economic or other factors bearing on securities
prices and the corporation's financial condition and future prospects. |
|
In connection with any such evaluation,
the Board is authorized to conduct such investigations
and to engage in such legal proceedings as the Board
may determine. |
|
| |