ex4-2



Exhibit 4.2



CERTIFICATE OF CORPORATE RESOLUTION

OF THE BOARD OF DIRECTORS

OF W HOLDING COMPANY, INC.


DESIGNATING

7.40% NONCUMULATIVE MONTHLY INCOME PREFERRED STOCK,

2001 SERIES D,

PAR VALUE $1.00 PER SHARE

(LIQUIDATION PREFERENCE $25 PER SHARE)


      WHEREAS, the Certificate of Incorporation (the “Charter”) of W Holding
Company, Inc. (the “Company”) authorizes the issuance of 20,000,000 shares of
the Company’s preferred stock, par value $1.00 per share (“Preferred Stock”),
in one or more series, and authorizes the Board of Directors to fix by
resolution or resolutions the designation of each series of Preferred Stock and
the powers, preferences and relative, participation, optional or other special
rights, and qualifications, limitations or restrictions thereof; and


      WHEREAS, the Board of Directors of the Company has determined that the
preferences and relative, participating, optional and other special rights, and
qualifications, limitations or restrictions of the 7.40% Noncumulative Monthly
Income Preferred Stock, 2001 Series D, liquidation preference $25 per share,
stated and expressed herein are, under the circumstances prevailing at this
time, fair and equitable to all existing stockholders;


      NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors, in accordance
with the provisions of the Charter, hereby approves the issuance of 7.40%
Noncumulative Monthly Income Preferred Stock, 2001 Series D, liquidation
preference $25 per share, par value $1.00 per share, of the Company and fixes
the designation of such 7.40% Noncumulative Monthly Income Preferred Stock,
2001 Series D, liquidation preference $25 per share, and the powers,
preferences, rights, and qualifications, limitations and restrictions thereof,
in addition to those set forth in the Charter, as follows:


      1.       Designation; Ranking.


      (a)      The designation of such series of
Preferred Stock shall be “7.40%
Noncumulative Monthly Income Preferred Stock, 2001 Series D” (hereinafter
referred to as “Series D Preferred Stock”), and the number of shares
constituting such series shall be 1,792,000, which number may be increased (but
not above the total number of shares of authorized Preferred Stock) or
decreased (but not below the number of shares of Series D Preferred Stock then
outstanding) from time to time by the Board of Directors.


      (b)      The Series D Preferred Stock will, with respect to dividend rights and
rights on liquidation, rank (i) senior to all classes of common stock of the
Company, par value $1.00 per share (the “Common Stock”) and to all other equity
securities issued by the Company the terms of which specifically provide that
such equity securities will rank junior to the Series D Preferred Stock (or to
all series of the Preferred Stock in general) as to dividends and the
distribution of assets upon liquidation (the Common Stock, together with such
other equity securities, being hereinafter referred to as “Junior Stock”);
(ii) on a parity with the Company’s 7.125% Non-Cumulative, Convertible
Preferred Stock, Series A, the Company’s 7.25% Noncumulative Monthly Income
Preferred Stock, 1999 Series B, and the Company’s 7.60% Noncumulative
Monthly Income Preferred Stock, 2001 Series C, and all other equity
securities issued by the Company the terms of which specifically provide that
such equity securities will rank on a parity to the Series D Preferred Stock as
to dividends or the distribution of assets upon liquidation (“Parity Stock”);
and (iii) junior to all equity securities issued by the Company the terms
of which specifically provide that such equity securities will rank senior to
the Series D Preferred Stock as to dividends or the distribution of assets upon

 








liquidation. For this purpose, the term “equity securities” does not
include debt securities convertible into or exchangeable for equity securities.


      (c)      The Company may not issue capital stock ranking, as to dividend rights
or rights on liquidation, senior to the Series D Preferred Stock except with
the consent of the holders of at least two-thirds of the aggregate liquidation
preference of the Series D Preferred Stock and any series of Parity Stock at
the time outstanding.


      2.       Dividend Rights.


      (a)      The holders of Series D Preferred Stock shall be entitled to receive
when, as and if declared by the Board of Directors of the Company, out of
assets of the Company legally available therefor, cash dividends, accruing from
the date of original issuance (the “Issue Date”) at the annual rate per share
of 7.40% of the liquidation preference of $25 per share (equivalent to
$1.85 per share per annum) (the “Dividends”), payable, when, as and if
declared by the Board of Directors, monthly in arrears on the 15th day of each
month (each monthly period ending on any such date being hereinafter referred
to as a “dividend period”), at such annual rate. Dividends in each dividend
period shall accrue from the first day of such period, whether or not declared
or paid for the prior dividend period (except that the first Dividends payable
after the Issue Date shall accrue from the Issue Date). Each declared Dividend
shall be payable to holders of record as they appear at the close of business
on the stock register of the Company on such record dates, not exceeding 45
days preceding the payment dates thereof, as shall be fixed by the Board of
Directors of the Company. Dividends (1) for any period other than a full
dividend period, will be computed on the basis of a 360-day year consisting of
twelve 30-day months and (2) for each full dividend period, will be computed by
dividing the annual dividend rate by 12.


      (b)      Dividends shall be noncumulative. The Company is not obligated or
required to declare or pay Dividends, even if it has funds available for the
payment of such dividends. If the Board of Directors of the Company or an
authorized committee thereof does not declare a Dividend payable on a dividend
payment date, then the holders of such Series D Preferred Stock shall have no
right to receive a Dividend in respect of the dividend period ending on such
dividend payment date, and the Company will have no obligation to pay a
Dividend accrued for such dividend period or to pay any interest thereon,
whether or not dividends on such Series D Preferred Stock or the Common Stock
are declared for any future dividend period.


      (c)      If all Dividends due and payable for each of the twelve previous
monthly dividend periods (or such fewer dividend periods as there actually are)
shall not have been declared and paid, or declared and a sum sufficient for the
payment thereof shall not have been set apart for such payments, or the Company
has defaulted on the payment of the redemption price of any Series D Preferred
Stock called for redemption, no dividends shall be declared or paid or set
aside for payment and no other distribution shall be declared or made or set
aside for payment upon the Junior Stock, nor shall any Junior Stock be
redeemed, purchased or otherwise acquired for any consideration (or any monies
to be paid to or made available for a sinking fund for the redemption of any
such stock) by the Company (except by conversion into or exchange for other
Junior Stock).


      (d)      When Dividends and dividends upon any Parity Stock are not paid in
full (or a sum sufficient for such full payment is not set apart), all
dividends declared upon the Series D Preferred Stock and any Parity Stock will
be declared pro rata so that the amount of Dividends and dividends upon the
other series of capital stock will in all cases bear to each other the same
ratio that full Dividends, for the then-current dividend period (which will not
include any accumulation in respect of unpaid Dividends for prior dividend
periods), and full dividends, including required or permitted accumulations, if
any, on the Parity Stock, bear to each other.

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      (e)      Subject to any applicable laws and regulations, each Dividend payment
will be made by U.S. dollar check drawn on a bank in New York, New York or
San Juan, Puerto Rico and mailed to the record holder thereof at such holder’s
address as it appears on the register for such Series D Preferred Stock.


      3.       Liquidation Preferences.


      (a)      In the event of any liquidation of the Company, whether voluntary or
involuntary, the holders of Series D Preferred Stock shall be entitled to
receive out of the assets of the Company available for distribution to
shareholders an amount equal to $25 per share, plus accrued and unpaid
dividends, if any, for the then-current monthly dividend period to the date of
payment, and no more (the “Liquidation Preference”), before any distribution
shall be made to the holders of Junior Stock. After payment of the full amount
of such liquidating distributions, the holders of Series D Preferred Stock will
not be entitled to any further participation in any distribution of the
remaining assets of the Company.


      (b)      If the assets of the Company available for distribution to
shareholders upon any liquidation of the Company, whether voluntary or
involuntary, shall be insufficient to pay in full the amounts payable with
respect to the Series D Preferred Stock and any Parity Stock, the holders of
Series D Preferred Stock and Parity Stock shall share ratably in any
distribution of assets of the Company in proportion to the full liquidating
distributions to which they would otherwise be respectively entitled.


      (c)      The merger or consolidation of the Company with or into any other
entity, the merger or consolidation of any other entity with or into the
Company, or the sale, lease or conveyance of all or substantially all of the
property or business of the Company, shall not be deemed to constitute a
liquidation of the Company within the meaning of this Section 3.


      4.       No Maturity Date or Mandatory Redemption.


      The Series D Preferred Stock will not mature on a specified date and is
not subject to any mandatory redemption, sinking fund or similar obligation.
Holders will have no right to require the Company to repurchase or redeem any
shares of Series D Preferred Stock.


      5.       Redemption.


      (a)      Holders of the Series D Preferred Stock will have no right to require
the Company to redeem or repurchase the Series D Preferred Stock and such
shares are not subject to any sinking fund or similar obligation.


      (b)      The Series D Preferred Stock will not be redeemable, in whole or in
part, before August 1, 2006. After August 1, 2006, the Series D Preferred
Stock will be redeemable at the option of the Company, at any time or from time
to time, upon not less than 30 nor more than 60 days’ notice by mail, at the
following redemption prices, plus accrued and unpaid dividends, if any, for the
then-current dividend period to the date fixed for redemption:



	 	 	 	 	 
	Year		Redemption
			Price
			
	2006		$	25.50	
	
	
	
	

	2007		$	25.25	
	
	
	
	

	2008 and thereafter		$	25.00	



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      (c)      If less than all of the outstanding shares of the Series D Preferred
Stock are to be redeemed at the option of the Company, the total number of
shares to be redeemed in such redemption shall be determined by the Board of
Directors, and the shares to be redeemed shall be allocated pro rata or by lot
as may be determined by the Board of Directors or by such other method as the
Board of Directors may approve and deem fair and appropriate, including any
method to conform to any rule or regulation of any national or regional stock
exchange or automated quotation system upon which the shares of the Series D
Preferred Stock may at the time be listed or eligible for quotation; provided
that, the shares of a holder must be redeemable in full unless the Company
obtains a ruling from the Puerto Rico Treasury Department or an opinion
from reputable counsel knowledgeable in Puerto Rico income tax matters to the
effect that the redemption in part of the holder’s shares is not equivalent to
a dividend under Puerto Rico law.


      (d)      Notice of any redemption shall be given by first class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the date fixed
for redemption to each holder of record of the Series D Preferred Stock to be
redeemed, at their respective addresses appearing on the stock books of the
Company. Notice so mailed shall be conclusively presumed to have been duly
given whether or not actually received, and failure to duly give such notice by
mail, or any defect in such notice, to the holders of any shares designated for
redemption shall not affect the validity of the proceedings for the redemption
of any other shares of Series D Preferred Stock. Such notice shall state:
(i) the Redemption Date; (ii) the redemption price; (iii) the
number of shares of Series D Preferred Stock to be redeemed and, if less than
all the shares held by such holder are to be redeemed, the number of such
shares to be so redeemed from such holder; (iv) the place where
certificates for such shares are to be surrendered for payment of the
redemption price; and (v) that after such Redemption Date the shares to be
redeemed shall not accrue dividends. If such notice is mailed as aforesaid,
and if on or before the Redemption Date funds sufficient to redeem the shares
called for redemption are set aside by the Company in trust for the account of
the holders of the shares to be redeemed, notwithstanding the fact that any
certificate for shares called for redemption shall not have been surrendered
for cancellation, on and after the Redemption Date the shares represented
thereby so called for redemption shall be deemed to be no longer outstanding,
dividends thereon shall cease to accrue, and all rights of the holders of such
shares as stockholders of the Company shall cease, except the right to receive
the redemption price, without interest, upon surrender of the certificate
representing such shares. Upon surrender in accordance with the aforesaid
notice of the certificate for any shares so redeemed (duly endorsed or
accompanied by appropriate instruments of transfer, if so required by the
Company in such notice), the holders of record of such shares shall be entitled
to receive the redemption price, without interest. In case fewer than all the
shares represented by any such certificate are redeemed, a new certificate
shall be issued representing the unredeemed shares without cost to the holder
thereof.


      (e)      At its option, the Company may, on or prior to the Redemption Date,
irrevocably deposit the aggregate amount payable upon redemption of the shares
of the Series D Preferred Stock to be redeemed with a bank or trust bank
designated by the Company having its principal office in New York, New York,
San Juan, Puerto Rico, or any other city in which the Company shall at that
time maintain a transfer agent with respect to its capital stock, and having a
combined capital surplus (as shown by its latest published statement) of at
least $50,000,000 (hereinafter referred to as the “Depository”), to be held in
trust by the Depository for payment to the holders of the Series D Preferred
Stock to be redeemed. If such deposit is made and the funds so deposited are
made immediately available to the holders of the Series D Preferred Stock to be
redeemed, the Company shall thereupon be released and discharged (subject to
the provisions described in the next paragraph) from any obligation to make
payment of the amount payable upon redemption of the Series D Preferred Stock
to be redeemed, and the holders of such shares shall look only to the
Depository for such payment.


      (f)      Any funds remaining unclaimed at the end of two years from and after
the Redemption Date in respect of which such funds were deposited shall be
returned to the Company


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forthwith and thereafter the holders of the Series D Preferred Stock
called for redemption with respect to which such funds were deposited shall
look only to the Company for the payment of the redemption price thereof. Any
interest accrued on any funds deposited with the Depository shall belong to the
Company and shall be paid to it from time to time on demand. Any of the Series
D Preferred Stock which shall at any time have been redeemed shall, after such
redemption, have the status of authorized but unissued preferred shares,
without designation as to series, until such shares are once more designated as
part of a particular series by the Board of Directors.


      (g)      To the extent required to have the Series D Preferred Stock treated as
Tier 1 capital for bank regulatory purposes or otherwise required by applicable
regulations of the Federal Reserve Board, the shares of Series D Preferred
Stock may not be redeemed by the Company without the prior consent of the Board
of Governors of the Federal Reserve System.


      6.       Voting Rights.


      (a)      Except as expressly required by applicable law, or except as indicated
below, the holders of the Series D Preferred Stock will not be entitled to
receive notice of, or attend or vote at, any meeting of the stockholders of the
Company.


      (b)      If at the time of any annual meeting of the Company’s stockholders for
the election of directors, the Company has failed to pay or declare and set
aside for payment a monthly Dividend for each of the 18 preceding monthly
dividend periods, the number of directors then constituting the Board of
Directors of the Company shall be increased by one (if not already increased by
one due to a default in preference dividends), and at such annual meeting the
holders of the Series D Preferred Stock, along with the holders of any other
series of Preferred Stock which may have voting rights due to the Company’s
failure to pay dividends, will be entitled to elect such additional director to
serve on the Company’s Board of Directors. Such director elected by the
holders of the Series D Preferred Stock and any other Preferred Stock shall
continue to serve as director until the earlier of (i) the full term for
which he or she shall have been elected or (ii) the payment of twelve
consecutive monthly Dividends.


      (c)      Unless the vote or consent of the holders of a greater number of
shares is then required by law, the affirmative vote or consent of the holders
of at least two-thirds of the aggregate liquidation preference of the Series D
Preferred Stock and of the shares of any Parity Stock at the time outstanding,
given in person or by proxy, either in writing or by a vote at a meeting called
for the purpose at which the holders of Series D Preferred Stock and any such
other series of Parity Stock will vote together as a single class without
regard to series, will be necessary for authorizing, effecting or validating
any variation or abrogation of the powers, preferences, rights, privileges,
qualifications, limitations and restrictions of the Series D Preferred Stock or
any such other series of Parity Stock by way of amendment, alteration or repeal
of any of the provisions of the Charter of the Company, or of any amendment or
supplement thereto, or otherwise (including any certificate of amendment or any
similar document relating to any series of Company preferred stock).
Notwithstanding the foregoing, the Company may, without the consent or sanction
of the holders of Series D Preferred Stock, authorize or issue capital stock of
the Company ranking, as to dividend rights and rights on liquidation, winding
up and dissolution, on a parity with or junior to the Series D Preferred Stock.


      (d)      Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the affirmative vote or consent of the
holders of at least two-thirds of the aggregate liquidation preference of the
Series D Preferred Stock and any other series of Parity Stock at the time
outstanding, given in person or by proxy, either in writing or by a vote at a
meeting called for the purpose at which the holders of Series D Preferred Stock
and any such other series of Parity Stock shall vote together as a single class
without regard to series, shall be necessary to create, authorize or issue, or
reclassify any authorized capital stock of the Company into, or create,

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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 both the Series D Preferred Stock and any other series of
Parity Stock. Subject to the foregoing, the Company’s Charter may be amended
to increase the number of authorized shares of Preferred Stock without the vote
of the holders of Preferred Stock, including the Series D Preferred Stock. No
vote of the holders of the Series D Preferred Stock and any other series of
Parity Stock will be required for the Company to redeem or purchase and cancel
the Series D Preferred Stock in accordance with the Charter or this Certificate
of Corporate Resolution for the Series D Preferred Stock.


      7.      Conversion. The Series D Preferred Stock will not be convertible into
or exchangeable for any other securities of the Company.


      8.      Replacement or Lost Certificates. If any certificate for a share of
Series D Preferred Stock is mutilated or alleged to have been lost, stolen or
destroyed, a new certificate representing the same share shall be issued to the
holder upon request subject to delivery of the old certificate or, if alleged
to have been lost, stolen or destroyed, subject to compliance with such
conditions as to evidence, indemnity and the payment of out-of-pocket expenses
of the Company in connection with the request, as the Board of Directors of the
Company may determine.


      9.      No Preemptive Rights. Holders of Series D Preferred Stock will have no
preemptive or preferential rights to purchase any securities of the Company.

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      IN WITNESS WHEREOF, the undersigned hereby certify that the above
resolutions were duly adopted by the Board of Directors of the Company on
August 1, 2001.

	 
	By:  /s/ Frank C. Stipes      

     Name:  Frank C. Stipes

     Title: President
	 
	By:  /s/ Cesar A. Ruiz        

     Name: Cesar A. Ruiz

     Title: Secretary





      Affidavit No. 7,461


      Sworn and subscribed before me by Frank C. Stipes, of legal age, married,
President of W Holding Company, Inc. and a resident of Mayaguez, Puerto Rico,
and Cesar A. Ruiz, of legal age, married, Secretary of W Holding
Company, Inc. and a resident of Mayaguez, Puerto Rico, to me personally known.


      In Mayaguez, Puerto Rico, on the 1st day of August, 2001.

	 
	  /s/ Jose Landron              

Notary Public






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