EXHIBIT A
TEXT OF PROPOSED AMENDMENTS TO THE CERTIFICATE
OF INCORPORATION OF THE WET SEAL, INC.
Set forth below are the proposed amendments to the Certificate of
Incorporation of the Company which are to submitted for the approval of the
stockholders of the Company at the Annual Meeting to be held on June 17, 1997.
If such proposed amendments are approved by the stockholders of the Company, the
Board of Directors will cause a Restated Certificate of Incorporation containing
the proposed amendments to be filed with the Secretary of State of the State of
Delaware and will adopt conforming amendments to the Company's By-laws.
1. ARTICLE IX
Set forth below is the text of renumbered Article IX of the Company's
Certificate of Incorporation, as proposed to be amended if Proposal # 1 is
approved by the Company's stockholders:
"ARTICLE IX
BOARD OF DIRECTORS
The business and affairs of the Corporation shall be managed by or
under the direction of the board of directors initially consisting of
nine (9) directors. The number of directors may be increased or
decreased (but to no more than fifteen (15) nor fewer than three (3)
directors) from time to time by resolution adopted by the board of
directors then in office, provided that a quorum is present. In no case
will a decrease in the number of directors shorten the term of any
incumbent director.
Upon the filing of this Restated Certificate of Incorporation with
the Secretary of State of the State of Delaware, the directors shall be
classified, with respect to the time for which they severally hold
office, into three (3) classes to be designated Class I, Class II and
Class III. Each class of directors shall consist, as nearly as may be
possible, of one-third of the total number of directors constituting the
entire Board of Directors. The initial Class I directors shall consist
of Kathy Bronstein, Irving Teitelbaum and Edmond Thomas; the initial
Class II directors shall consist of Stephen Gross, Wilfred Posluns and
Gerald Randolph; and the initial Class III directors shall consist of
George H. Benter, Jr., Walter F. Loeb and Alan Siegel or in each case,
another person or persons who is nominated and elected instead of any
such person. The term of the initial Class I directors shall terminate
on the date of the 2000 annual meeting of stockholders. The term of the
initial Class II directors shall terminate on the date of the 1999
annual meeting of stockholders. The term of the initial Class III
directors shall terminate on the date of the 1998 annual meeting of
stockholders. At each annual meeting of stockholders beginning in 1998,
the successors to the class of directors whose term expires at that
annual meeting shall be elected for a three-year term until their
successors are elected and qualified. If the number of directors is
changed, any increase or decrease in the number of directors shall be
apportioned among the classes of directors so as to maintain the number
of directors in each class as nearly equal as possible.
Any or all of the directors may be removed with or without cause by
vote of the stockholders. Notwithstanding anything contained in this
Restated Certificate of Incorporation to the contrary and
notwithstanding the fact that a lesser percentage may be permitted by
law or the By-laws of the Corporation, the affirmative vote of the
holders of at least seventy-five percent (75%) of the shares of the
Corporation entitled to vote generally for the election of directors,
voting together as a single class, each class having the number of votes
per share as provided by this Restated Certificate of Incorporation,
shall be required to remove any director from office without cause.
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Newly created directorships resulting from an increase in the number
of directors or vacancies occurring in the board of directors for any
reason, except the removal of directors by stockholders without cause,
may be filled by vote of a majority of the directors then in office,
even if less than a quorum exists, or may be filled by a sole remaining
director. Vacancies occurring as a result of the removal of directors by
stockholders without cause shall be filled by the stockholders. A
director elected to fill a vacancy or a newly created directorship shall
be elected to hold office until the next annual meeting of stockholders,
and such director's successor shall be elected to hold office for a term
that shall coincide with the term of the class to which such director
was elected.
Notwithstanding anything contained in this Restated Certificate of
Incorporation to the contrary and notwithstanding the fact that a lesser
percentage may be permitted by law or the By-laws of the Corporation,
the affirmative vote of the holders of at least seventy-five percent
(75%) of the shares of the Corporation entitled to vote generally for
the election of directors, voting together as a single class, each class
having the number of votes per share as provided by this Restated
Certificate of Incorporation, shall be required to alter, amend or
repeal this Article IX."
2. ARTICLE IV, SECTION 4.1
Set forth below is the text of Article IV, Section 4.1 of the
Company's Certificate of Incorporation, as proposed to be amended if
Proposal # 2 is approved by the Company's stockholders:
"Section 4.1. NUMBER OF SHARES. The total number of shares which
the Corporation shall have authority to issue is SIXTY-FIVE MILLION
(65,000,000), consisting of "Common Stock" and "Preferred Stock" as
follows:
(a) PREFERRED STOCK. The total number of shares of Preferred
Stock shall be FIVE MILLION (5,000,000), having a par value of one
cent ($0.01) per share, which may be issued from time to time in one
or more series. The board of directors is hereby authorized to fix,
by resolution or resolutions providing for the issue of any such
series, the voting powers, if any, and the designation, preferences
and rights of the shares in such series, and the qualifications,
limitations or restrictions thereof, including, but not limited to,
the following:
(1) the number of shares constituting that series and the
distinctive designation thereof;
(2) the dividend rate on the shares of that series, whether
dividends shall be cumulative and, if so, from which date or
dates, and the relative rights of priority, if any, of
payment of dividends on shares of that series;
(3) the voting rights, if any, of shares of that series in
addition to the voting rights provided by law, and the terms
of such voting rights;
(4) the terms and conditions of the conversion privileges, if
any, of shares of that series, including provision for
adjustment of the conversion rate in such events as the board
of directors shall determine;
(5) the terms and conditions of redemption, if shares of that
series shall be redeemable, including the date or dates upon
or after which they shall be redeemable, and the amount per
share payable in case of redemption, which amount may vary
under different conditions and at different redemption dates;
(6) the terms and amount of any sinking fund for the redemption
or purchase of shares of that series, if any;
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(7) the rights of the shares of that series in the event of
voluntary or involuntary liquidation, dissolution or winding
up of the Corporation, and the relative rights or priority,
if any, of payment of shares of that series; and
(8) any other relative rights, preferences and limitations of
that series.
Dividends on outstanding Preferred Stock shall be declared and paid,
or set apart for payment, before any dividend shall be declared and
paid, or set apart for payment, on the Common Stock with respect to the
same dividend period.
(b) COMMON STOCK. The total number of shares of Common Stock shall
be SIXTY MILLION (60,000,000), divided into two classes designated as
Class A Common Stock and Class B Common Stock, as follows: the total
number of authorized shares of Class A Common Stock shall be FIFTY
MILLION (50,000,000), and each share of Class A Common Stock shall have
a par value of ten cents ($0.10); and the total number of authorized
shares of Class B Common Stock shall be TEN MILLION (10,000,000), and
each share of Class B Common Stock shall have a par value of ten cents
($0.10)."
3. ARTICLE X
Set forth below is the text of new ARTICLE X to be added to the Company's
Certificate of Incorporation, as proposed to be amended if Proposal # 3 is
approved by the Company's stockholders:
"ARTICLE X
BUSINESS COMBINATIONS
Notwithstanding anything contained in this Restated Certificate of
Incorporation to the contrary and notwithstanding the fact that a lesser
percentage may be permitted by law or the By-laws of the Corporation,
the affirmative vote of the holders of at least seventy-five percent
(75%) of the shares of the Corporation entitled to vote generally for
the election of directors, voting together as a single class, shall be
required in order to approve or authorize any Business Combination (as
defined below) which has not been approved or authorized by at least
seventy-five percent (75%) of the directors then in office. The term
"Business Combination" as used in this Article X shall mean:
(a) any merger or consolidation of the Corporation or any subsidiary
of the Corporation with any other corporation which is required
by law to be approved or authorized by the stockholders;
(b) any sale, lease or exchange of all, or substantially all, of the
property and assets of the Corporation or any subsidiary of the
Corporation;
(c) any distribution to stockholders in partial or complete
liquidation of the assets of the Corporation or any subsidiary of
the Corporation;
(d) the issuance or transfer by the Corporation or any subsidiary of
the Corporation of any securities of the Corporation or any
subsidiary which is required by law to be approved or authorized
by the stockholders, or with respect to which stockholder
approval or authorization would be a prerequisite to the listing
on the Nasdaq Stock Market's National Market or any other
national securities exchange (each, an "Exchange") of the
securities to be issued or transferred; and
(e) any reclassification of securities or recapitalization of the
Corporation, or any merger or consolidation of the Corporation
with any of its subsidiaries, which is required by law to be
approved or authorized by the stockholders, or with respect to
which stockholder
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approval would be a prerequisite to the listing on an Exchange of
the securities to be issued or transferred.
Notwithstanding anything contained in this Restated Certificate of
Incorporation to the contrary and notwithstanding the fact that a lesser
percentage may be permitted by law or the By-laws of the Corporation,
the affirmative vote of the holders of at least seventy-five percent
(75%) of the shares of the Corporation entitled to vote generally for
the election of directors, voting together as a single class, each class
having the number of votes per share as provided by this Restated
Certificate of Incorporation, shall be required to alter, amend or
repeal this Article X."
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