Exhibit 4.3
CERTIFICATE OF DESIGNATIONS
$3.75 SERIES B CONVERTIBLE PREFERRED STOCK
OF
AMAX GOLD INC.
PAR VALUE $1.00 PER SHARE
LIQUIDATION VALUE $50 PER SHARE
PURSUANT TO SECTION 151 OF THE GENERAL
CORPORATION LAW OF THE STATE OF DELAWARE
The undersigned duly authorized officer of Amax Gold Inc., a corporation
organized and existing under the laws of the State of Delaware (the
"Corporation"), in accordance with the provisions of Section 103 of the General
Corporation Law of the State of Delaware (the "DGCL"), and pursuant to Section
151 thereof, hereby certifies as follows:
FIRST: The Restated Certificate of Incorporation, as amended, of the
Corporation authorizes the issuance of up to 210,000,000 shares of capital
stock, of which 200,000,000 shares shall be shares of common stock, par value
$.01 per share ("Common Stock"); and 10,000,000 shares shall be shares of
preferred stock, par value $1.00 per share ("Preferred Stock").
SECOND: The Restated Certificate of Incorporation, as amended, of the
Corporation, authorizes the Board of Directors of the Corporation to provide for
the issuance of Preferred Stock in one or more series, with such designation,
powers, preferences and relative, participating, optional or other special
rights, and qualifications, limitations or restrictions thereof, as shall be
stated and expressed in the resolution or resolutions providing for the issue of
such series adopted by the Board of Directors of the Corporation, subject to the
limitations prescribed by law and except as otherwise provided in the Restated
Certificate of Incorporation or any amendment thereto.
THIRD: Pursuant to authority conferred upon the Board of Directors of the
Corporation by the Restated Certificate of Incorporation, as amended, of the
Corporation under the provisions of Section 151 of the DGCL, the Board of
Directors of the Corporation, at a meeting duly held on July 26, 1994, and the
Pricing Committee of the Board of Directors of the Company, by written consent
dated August 4, 1994, adopted the following resolutions providing for an issue
of a series of the Corporation's Preferred Stock, which resolutions are still in
full force and effect and are not in conflict with any provision of the Restated
Certificate of Incorporation, as amended, or the By-Laws of the Corporation:
"RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation by Section 151 of the DGCL and the provisions of its Restated
Certificate of Incorporation, as amended, an issue of a series of the Preferred
Stock, par value $1.00 per share, of the Corporation is hereby created,
consisting of 1,840,000 shares, with the designations, powers, preferences and
relative, participating, optional or other special rights, and qualifications,
limitations or restrictions thereof, of the shares of such series as follows:
(1) Designation, Number of Shares and Rank. The designation of such
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series shall be "$3.75 Series B Convertible Preferred Stock" (hereinafter
referred to as the "Series B Convertible Preferred Stock"). Each share of Series
B Convertible Preferred Stock shall be identical in all respects with the other
shares of Series B Convertible Preferred Stock.
All shares of Series B Convertible Preferred Stock shall rank prior, both
as to payment of dividends and as to distributions of assets upon liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
to all of the Corporation's now or hereafter issued Common Stock.
(2) Dividends. The holders of shares of Series B Convertible Preferred
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Stock shall be entitled to receive, when, as and if declared by the Board of
Directors of the Corporation, but only out of funds legally available therefor,
dividends at the annual rate of $3.75 per share, and no more, which shall be
fully cumulative, shall accrue without interest from the date of first issuance
and shall be payable in cash in equal quarterly installments on the 1st day of
August 15, November 15, February 15 and May 15 of each year, commencing on
November 15, 1994 (except that if any such date is not a business day, then such
dividend shall be payable on the next succeeding business day) (each, a
"Dividend Payment Date"), to stockholders of record as they appear on the stock
transfer books of the Corporation on such record dates, not more than 60 nor
less than 10 days preceding such Dividend Payment Date, as are fixed by the
Board of Directors of the Corporation. For the purposes hereof, the term
"business day" shall mean each Monday, Tuesday, Wednesday, Thursday or Friday
which is not a day on which banking institutions are authorized or obligated by
law or executive order to close in New York, New York. Subject to the next
paragraph of this Section 2, dividends on account of arrears for any past
dividend periods may be declared and paid at any time, without reference to any
Dividend Payment Date, to holders of record on such date, not exceeding 45 days
preceding the payment date thereof, as may be fixed by the Board of Directors of
the Corporation. The amount of dividends payable per share of Series B
Convertible Preferred Stock for each quarterly dividend period shall be computed
by dividing the annual amount by four. The amount of dividends payable on the
Series B Convertible Preferred Stock for the initial dividend period and for any
period less than a full quarterly dividend period shall be
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computed on the basis of a 360-day year consisting of twelve 30-day months.
Holders of shares of Series B Convertible Preferred Stock shall not be entitled
to any dividend whether payable in cash, property or stock, in excess of the
full cumulative dividends on such shares of Series B Convertible Preferred
Stock.
On each Dividend Payment Date all dividends which shall have accrued on
each share of Series B Convertible Preferred Stock outstanding on such Dividend
Payment Date shall accumulate and be deemed to become "due" whether or not
declared and whether or not there shall be funds legally available for the
payment thereof. Any dividend which shall not be paid on the Dividend Payment
Date on which it shall become due shall be deemed to be "past due" until such
dividend shall be paid or until the share of Series B Convertible Preferred
Stock with respect to which such dividend became due shall no longer be
outstanding, whichever is the earlier to occur. No interest or sum of money or
other property or securities in lieu of interest shall be payable in respect of
any dividend payment or payments which are past due. Dividends paid on shares of
Series B Convertible Preferred Stock in an amount less than the total amount of
such dividends at the time accumulated and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at the time
outstanding.
No dividends or other distributions, other than dividends payable solely in
shares of Common Stock, shall be paid, or declared and set apart for payment in
respect of, and no purchase, redemption or other acquisition for any
consideration shall be made by the Corporation of and no sinking fund or other
analogous fund payments shall be made in respect of any shares of Common Stock
or other capital stock of the Corporation ranking junior as to dividends or as
to liquidation rights to the Series B Convertible Preferred Stock (the "Junior
Dividend Stock") unless and until all accrued and unpaid dividends on the Series
B Convertible Preferred Stock, including the full dividend for the then current
dividend period, shall have been paid or declared and set apart for payment and
the Corporation is not in default in respect of the optional redemption of any
shares of Series B Convertible Preferred Stock.
No dividends or other distributions shall be paid or declared and set apart
for payment and no purchase, redemption or other acquisition for any
consideration shall be made by the Corporation of, and no sinking fund or other
analogous fund payments shall be made in respect of, any class or series of the
Corporation's capital stock ranking, as to dividends, on a parity with the
Series B Convertible Preferred Stock (the "Parity Dividend Stock"), including
any then outstanding $2.25 Series A Convertible Preferred Stock, par value $1.00
per share (the "Series A Preferred Stock"), for any period unless full
cumulative dividends have been, or contemporaneously are, paid or declared and
set apart for such payment on the Series B Convertible Preferred Stock for all
dividend payment periods
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terminating on or prior to the date of payment of such full cumulative
dividends. No dividends shall be paid or declared and set apart for payment on
the Series B Convertible Preferred Stock for any period unless full cumulative
dividends have been, or contemporaneously are, paid or declared and set apart
for payment on the Parity Dividend Stock for all dividend periods terminating on
or prior to the date of payment of such full cumulative dividends. When
dividends are not paid in full upon the Series B Convertible Preferred Stock and
the Parity Dividend Stock, all dividends paid or declared and set apart for
payment upon shares of Series B Convertible Preferred Stock and the Parity
Dividend Stock shall be paid or declared and set apart for payment pro rata so
that the amount of dividends paid or declared and set apart for payment per
share on the Series B Convertible Preferred Stock and the Parity Dividend Stock
shall in all cases bear to each other the same ratio that accrued and unpaid
dividends per share on the shares of Series B Convertible Preferred Stock and
the Parity Dividend Stock bear to each other.
The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of capital stock of
the Corporation or any Parity Dividend Stock unless the Corporation could, under
this Section 2, purchase or otherwise acquire such shares at such time and in
such manner. Any reference to "distribution" contained in this Section 2 shall
not be deemed to include any distribution made in connection with any
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary.
(3) Liquidation Preference. In the event of any liquidation, dissolution
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or winding up of the Corporation, whether voluntary or involuntary, the holders
of shares of Series B Convertible Preferred Stock shall be entitled to receive
out of the assets of the Corporation, whether such assets are stated capital or
surplus of any nature, an amount equal to the dividends accrued and unpaid
thereon to the date of final distribution to such holders, whether or not
declared, without interest, and a sum equal to $50.00 per share, and no more,
before any payment shall be made or any assets distributed to the holders of
Common Stock or any other class or series of the Corporation's capital stock
ranking junior as to liquidation rights to the Series B Convertible Preferred
Stock (the "Junior Liquidation Stock"). In the event the assets of the
Corporation available for distribution to stockholders upon any liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
shall be insufficient to pay in full the amounts payable with respect to the
Series B Convertible Preferred Stock and any other class or series of the
Corporation's capital stock which has been or may hereafter be created ranking
on a parity as to liquidation rights with the Series B Convertible Preferred
Stock (the "Parity Liquidation Stock"), including any then outstanding Series A
Preferred Stock, the holders of the Series B Convertible Preferred Stock and the
holders of the Parity Liquidation Stock shall share ratably in any distribution
of
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assets of the Corporation in proportion to the full respective preferential
amounts to which they are entitled (but only to the extent of such preferential
amounts). After payment in full of the liquidation preferences of the shares of
Series B Convertible Preferred Stock, the holders of such shares shall not be
entitled to any further participation in any distribution of assets by the
Corporation. Neither a consolidation, merger or other business combination of
the Corporation with or into another corporation or other entity nor a sale or
transfer of all or part of the Corporation's assets for cash, securities or
other property shall be considered a liquidation, dissolution or winding up of
the Corporation for purposes of this Section 3 (unless in connection therewith
the liquidation of the Corporation is specifically approved).
The holder of any shares of Series B Convertible Preferred Stock shall not
be entitled to receive any payment owed for such shares under this Section 3
until such holder shall cause to be delivered to the Corporation (i) the
certificate(s) representing such shares of Series B Convertible Preferred Stock
and (ii) transfer instrument(s) satisfactory to the Corporation and sufficient
to transfer such shares of Series B Convertible Preferred Stock to the
Corporation free of any liens or encumbrances thereon or rights of third parties
thereto. As in the case of the Redemption Price referred to below, no interest
shall accrue on any payment upon liquidation after the due date thereof.
(4) Redemption at the Option of the Corporation.
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(a) Right of Redemption. Subject to and upon compliance with the
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provisions of this Section 4, the Corporation, at its option, may at any time
redeem the Series B Convertible Preferred Stock, in whole or from time to time
in part, on any date on or after August 15, 1997 set by the Board of Directors
of the Corporation, at the following redemption prices per share, if redeemed
during the 12-month period commencing on August 15, of the year indicated:
Price
Years per Share
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1997............................................. $52.625
1998............................................. 52.250
1999............................................. 51.875
2000............................................. 51.500
2001............................................. 51.125
2002............................................. 50.750
2003............................................. 50.375
2004 and thereafter.............................. 50.000
plus in each case accrued and unpaid dividends to, but excluding, the date of
redemption.
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In case of the redemption of less than all of the then outstanding Series B
Convertible Preferred Stock, the shares of Series B Convertible Preferred Stock
to be redeemed shall be redeemed pro rata or by lot or in such other equitable
manner as the Board of Directors of the Corporation reasonably may determine.
Notwithstanding the foregoing, the Corporation shall not redeem less than all of
the Series B Convertible Preferred Stock at any time outstanding until all
dividends accrued and in arrears upon all Series B Convertible Preferred Stock
and Parity Dividend Stock then outstanding shall have been paid for all past
dividend periods.
(b) Manner of Exercise of Redemption Option. In order to exercise
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its redemption option, the Corporation must give written notice in person or by
first class mail, postage prepaid, of such redemption to each holder of record
of the shares of Series B Convertible Preferred Stock to be redeemed, at such
holder's address as it shall appear upon the stock transfer books of the
Corporation not more than 60 days nor less than 30 days prior to the redemption
date. Each such notice of redemption shall state, as appropriate: (1) the date
fixed for redemption; (2) the number of shares of Series B Convertible Preferred
Stock to be redeemed and, if fewer than all of the shares held by such holder
are to be redeemed, the number of such shares to be redeemed from such holder;
(3) the Redemption Price per share of Series B Convertible Preferred Stock; (4)
the place or places of payment that payment of the Redemption Price will be made
upon presentation and surrender of the certificate or certificates evidencing
the shares of Series B Convertible Preferred Stock to be redeemed; (5) that on
and after the redemption date, dividends will cease to accrue on such shares;
and (6) the then effective Conversion Price pursuant to Section 5 and that the
right of holders to convert shall terminate at the close of business on the
redemption date (unless the Corporation defaults in the payment of the
Redemption Price).
Any notice that is delivered or mailed as herein provided shall be
conclusively presumed to have been duly given, whether or not the holder of the
Series B Convertible Preferred Stock receives such notice; and failure to give
such notice, 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 B Convertible Preferred Stock. On
or after the date fixed for redemption as stated in such notice, each holder of
the shares of Series B Convertible Preferred Stock called for redemption shall
surrender the certificate or certificates evidencing such shares to the
Corporation at the place designated in such notice and shall thereupon be
entitled to receive payment of the Redemption Price as herein provided. If less
than all the shares represented by any such surrendered certificate are
redeemed, a new certificate shall be issued representing the unredeemed shares.
If, on the date fixed for redemption, cash necessary for the redemption shall be
available for such purpose and
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irrecoverably shall have been deposited or set apart, then, notwithstanding that
the certificates evidencing any shares so called for redemption shall not have
been surrendered, the dividends with respect to the shares so called shall cease
to accrue after the date fixed for redemption, the shares no longer shall be
deemed outstanding, the holders thereof shall cease to be holders of Series B
Convertible Preferred Stock, and all rights whatsoever with respect to the
shares so called for redemption (except the right of the holders to receive
payment of the Redemption Price as herein provided, without interest, upon
surrender of their certificates therefor) shall terminate. Any cash necessary
for the redemption of shares of Series B Convertible Preferred Stock shall be
deemed to be available therefor for purposes of the preceding sentence and for
purposes of Section 7, if, on or before the date fixed for redemption, the
Company shall deposit with a bank or trust company that has an office in the
Borough of Manhattan, City of New York, and that has, or is an affiliate of a
bank that has, a capital surplus of at least $50,000,000, the cash necessary for
such redemption, in trust, with irrevocable instructions that such cash be
applied to the redemption of the shares of the Series B Convertible Preferred
Stock and any Parity Dividend Stock so called for redemption. No interest shall
accrue for the benefit of the holders of shares of Series B Convertible
Preferred Stock to be redeemed on any cash so set apart by the Corporation.
Subject to applicable escheat laws, any such cash unclaimed at the end of six
years from the redemption date shall revert to the general funds of the
Corporation, after which reversion the holders of such shares so called for
redemption shall look only to the general funds of the Corporation for the
payment of such cash.
The holder of any shares of Series B Convertible Preferred Stock
redeemed upon any exercise of the Corporation's redemption right shall not be
entitled to receive payment of the Redemption Price for such shares until such
holder shall cause to be delivered to the place specified in the notice given
with respect to such redemption (i) the certificate or certificates representing
such shares of Series B Convertible Preferred Stock redeemed and (ii) transfer
instruments satisfactory to the Corporation and sufficient to transfer such
shares of Series B Convertible Preferred Stock to the Corporation free of any
adverse interest. No interest shall accrue on the Redemption Price of any share
of Series B Convertible Preferred Stock after its redemption date.
In the event that any shares of Series B Convertible Preferred Stock
shall be converted into Common Stock pursuant to Section 5, then (i) the
Corporation shall not have the right to redeem such shares and (ii) any funds
which shall have been deposited for the payment of the Redemption Price for such
shares of Series B Convertible Preferred Stock shall be returned to the
Corporation immediately after such conversion (subject to declared dividends
payable to holders of shares of Series B Convertible Preferred Stock on the
record date for such
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dividends, to the extent set forth in Section 5 hereof, regardless of whether
such shares are converted subsequent to such record date and prior to the
related Dividend Payment Date).
(c) Cash Payments in Lieu of Fractional Shares. No fractional shares
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of Series B Convertible Preferred Stock shall be issued upon any redemption of
Series B Convertible Preferred Stock, but, in lieu thereof, the Corporation
shall pay to the holder of such shares an appropriate amount in cash (computed
to the nearest cent) based on the value of the shares of Series B Convertible
Preferred Stock as determined in good faith by the Corporation's Board of
Directors.
(5) Conversion.
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(a) Right of Conversion. Subject to and upon compliance with the
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provisions of this Section 5, each share of Series B Convertible Preferred Stock
shall, at the option of the holder thereof, be convertible at any time (unless
such share is called for redemption, then to and including but not after 5:00
p.m. (New York City time) on the date fixed for such redemption, unless the
Corporation shall default in payment due upon redemption thereof), into that
number of fully paid and non-assessable shares of Common Stock (calculated as to
each conversion to the nearest 1/100th of a share) obtained by dividing $50.00
by the Conversion Price (as defined in Section 5(d)) in effect at such time and
by surrender of such share so to be converted in the manner provided in Section
5(b).
(b) Manner of Exercise of Conversion Privilege. In order to exercise
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the conversion privilege, the holder of one or more shares of Series B
Convertible Preferred Stock to be converted shall surrender such shares at any
of the offices or agencies to be maintained for such purpose by the Corporation
accompanied by the funds, if any, required by the last paragraph of this Section
5(b) and shall give written notice of conversion in the form provided on such
shares of Series B Convertible Preferred Stock (or such other notice as is
reasonably acceptable to the Corporation) to the Corporation at such office or
agency that the holder elects to convert the shares of Series B Convertible
Preferred Stock specified in said notice. Such notice shall also state the name
or names, together with address or addresses, in which the certificate or
certificates for shares of Common Stock which shall be issuable on such
conversion shall be issued. Each share of Series B Convertible Preferred Stock
surrendered for conversion, unless the shares issuable on conversion are to be
issued in the same name as the name in which such share of Series B Convertible
Preferred Stock is registered, shall be accompanied by instruments of transfer,
in form satisfactory to the Corporation, duly executed by the holder or such
holder's duly authorized attorney. As promptly as practicable after the
surrender of such shares of Series B Convertible Preferred Stock and the receipt
of such notice, instruments of transfer and funds, if any, as aforesaid, the
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Corporation shall issue and shall deliver at such office or agency to such
holder, or on his written order, a certificate or certificates for the number of
full shares of Common Stock issuable upon the conversion of such shares of
Series B Convertible Preferred Stock in accordance with the provisions of this
Section 5 and a check or cash in respect of any fractional interest in a share
of Common Stock arising upon such conversion, as provided in Section 5(c).
Each conversion shall be deemed to have been effected immediately
prior to the close of business on the business day following the date on which
such shares of Series B Convertible Preferred Stock shall have been surrendered
and such notice (and any applicable instruments of transfer and any required
taxes) received by the Corporation as aforesaid, and the person or persons in
whose name or names any certificate or certificates for shares of Common Stock
shall be issuable upon such conversion shall be deemed to have become the holder
or holders of record of the shares represented thereby at such time on such
date, and such conversion shall be at the Conversion Price in effect at such
time on such date, unless the stock transfer books of the Corporation shall be
closed on that date, in which event such person or persons shall be deemed to
have become such holder or holders of record at the close of business on the
next succeeding day on which such stock transfer books are open, and such
conversion shall be at the Conversion Price in effect on the close of business
on such next succeeding business day upon which such shares of Series B
Convertible Preferred Stock shall have been surrendered and such notice received
by the Corporation.
Any shares of Series B Convertible Preferred Stock surrendered for
conversion during the period from the close of business on the record date for
any dividend payment to the opening of business on the related Dividend Payment
Date (unless such shares of Series B Convertible Preferred Stock shall have been
called for redemption on a date in such period) shall be accompanied by payment,
in funds acceptable to the Corporation, of an amount equal to the dividend
otherwise payable on such Dividend Payment Date. Except as provided for above
in this Section, no adjustment shall be made for dividends accrued on any shares
of Series B Convertible Preferred Stock converted or for dividends on any shares
issued upon the conversion of such shares as provided in this Section.
(c) Cash Payments in Lieu of Fractional Shares. No fractional shares or
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scrip representing fractions of shares of Common Stock shall be issued upon
conversion of Series B Convertible Preferred Stock. If more than one share of
Series B Convertible Preferred Stock shall be surrendered for conversion at one
time by the same holder, the number of full shares of Common Stock issuable upon
conversion thereof shall be computed on the basis of the aggregate of $50.00 for
each such share so surrendered. In lieu of any fractional interest in a share of
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Common Stock which would otherwise be deliverable upon the conversion of any
share of Series B Convertible Preferred Stock, the Corporation shall pay to the
holder of such shares an amount in cash (computed to the nearest cent) equal to
the average Closing Price per share of Common Stock as calculated for the ten
day trading period ending on the fifth trading day prior to the day of
conversion multiplied by the fractional interest in a share of Common Stock that
otherwise would have been deliverable upon conversion of such share.
(d) Adjustment of Conversion Price. The "Conversion Price" shall mean and
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be $8.25, subject to adjustment from time to time by the Corporation as follows:
(i) In case the Corporation shall (A) pay a dividend or make a
distribution on its Common Stock in shares of Common Stock (other than
pursuant to a dividend reinvestment or similar plan), (B) subdivide its
outstanding shares of Common Stock into a greater number of shares, (C)
combine its outstanding shares of Common Stock into a smaller number of
shares, or (D) issue by reclassification of its Common Stock any shares of
capital stock of the Corporation, then in each such case the Conversion Price
in effect immediately prior to such action shall be adjusted so that the
holder of any share of Series B Convertible Preferred Stock thereafter
surrendered for conversion shall be entitled to receive the number of shares
of Common Stock or other capital stock of the Corporation which he would have
owned or been entitled to receive immediately following such action had such
share been converted immediately prior to the occurrence of such event. An
adjustment made pursuant to this subsection (i) shall become effective
immediately after the record date, in the case of a dividend or distribution,
or immediately after the effective date, in the case of a subdivision,
combination or reclassification.
(ii) In case the Corporation shall issue rights, options or warrants
to all holders of its outstanding shares of Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share less
than the current market price per share (as determined pursuant to subsection
(iv) of this Section 5(d)) of the Common Stock (other than pursuant to any
stock option, restricted stock or other incentive or benefit plan or stock
ownership or purchase plan for the benefit of employees, directors or
officers or any dividend reinvestment plan of the Corporation in effect at
the time hereof or any other similar plan adopted or implemented hereafter),
then with respect to any conversion prior to the expiration of such rights,
options or warrants, the Conversion Price in effect immediately prior thereto
shall be adjusted so that it shall equal the price determined by multiplying
the Conversion Price in effect immediately prior to the date of issuance of
such rights, options or warrants by a fraction of which the
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numerator shall be the number of shares of Common Stock outstanding on the
date of issuance of such rights, options or warrants (immediately prior to
such issuance) plus the number of shares which the aggregate offering price
of the total number of shares so offered would purchase at such current
market price, and of which the denominator shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights, options or
warrants (immediately prior to such issuance) plus the number of additional
shares of Common Stock offered for subscription or purchase. Such adjustment
shall be made successively whenever any rights, options or warrants are
issued, and shall become effective immediately after the record date for the
determination of stockholders entitled to receive such rights, options or
warrants; provided, however, in the event that all the shares of Common Stock
offered for subscription or purchase are not delivered upon the exercise of
such rights, options or warrants, upon the expiration of such rights, options
or warrants the Conversion Price shall be readjusted to the Conversion Price
which would have been in effect had the numerator and the denominator of the
foregoing fraction and the resulting adjustment been made based upon the
number of shares of Common Stock actually delivered upon the exercise of such
rights, options or warrants rather than upon the number of shares of Common
Stock offered for subscription or purchase. In determining whether any
rights, options or warrants entitle the holders to subscribe for or purchase
shares of Common Stock at less than such current market price, and in
determining the aggregate offering price of such shares of Common Stock,
there shall be taken into account any consideration received by the
Corporation for such rights, options or warrants, the value of such
consideration, if other than cash, to be determined by the Audit Committee of
the Board of Directors of the Corporation (whose reasonable determination
shall be conclusive, except for arithmetic errors, and shall be described in
a statement filed by the Corporation with the stock transfer agent).
(iii) In case the Corporation shall, by dividend or otherwise,
distribute to all holders of its outstanding Common Stock, evidences of its
indebtedness or assets (including securities and cash, but excluding any cash
dividend of the Corporation paid out of retained earnings and dividends or
distributions payable in stock pursuant to a dividend reinvestment or similar
plan or for which adjustment is made pursuant to subsection (i) of this
Section 5(d)) or rights, options or warrants to subscribe for or purchase
securities of the Corporation (excluding those referred to in subsection (ii)
of this Section 5(d)), then in each such case the Conversion Price shall be
adjusted so that the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to the record date of such
distribution by a fraction of which the numerator shall be the current market
price per
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share of the Common Stock as determined pursuant to subsection (iv) of this
Section 5(d) less the fair market value on such record date (as determined by
the Audit Committee of the Board of Directors of the Corporation, whose
reasonable determination shall be conclusive, except for arithmetic errors,
and shall be described in a statement filed by the Corporation with the stock
transfer agent) of the portion of the capital stock or assets or the
evidences of indebtedness or assets so distributed to the holder of one share
of Common Stock or of such subscription rights, options or warrants
applicable to one share of Common Stock, and of which the denominator shall
be such current market price per share of Common Stock. Such adjustment shall
become effective immediately after the record date for the determination of
stockholders entitled to receive such distribution.
(iv) For the purpose of any computation under subsections (ii) and
(iii) of this Section 5(d), the current market price per share of Common
Stock on any date shall be deemed to be the average of the Closing Price for
the shorter of (A) 30 consecutive trading days ending on the last full
trading day prior to the Time of Determination or (B) the period commencing
on the date next succeeding the first public announcement of the issuance of
such rights, options or warrants or such distribution through such last full
trading day prior to the Time of Determination. For purposes of the
foregoing, the term "Time of Determination" shall mean the time and date of
the earlier of (I) the record date for determining stockholders entitled to
receive the rights, options, warrants or distributions referred to in Section
5(d) (ii) and (iii) or (II) the commencement of "ex-dividend" trading on the
New York Stock Exchange or such other United States exchange or market on
which the Common Stock of the Corporation is then listed or admitted for
trading.
(v) In any case in which this Section 5(d) shall require that an
adjustment be made immediately following a record date or an effective date,
the Corporation may elect to defer (but only until the filing by the
Corporation with the stock transfer agent of the certificate required by
subsection (vii) of this Section 5(d)) issuing to the holder of any share of
Series B Convertible Preferred Stock converted after such record date or
effective date the shares of Common Stock issuable upon such conversion over
and above the shares of Common Stock issuable upon such conversion on the
basis of the Conversion Price prior to adjustment, and paying to such holder
any amount of cash in lieu of a fractional share.
(vi) No adjustment in the Conversion Price shall be required to be
made unless such adjustment would require an increase or decrease of at least
1% of such price;
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provided, however, that any adjustments which by reason of this subsection
(vi) are not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this Section
5(d) shall be made to the nearest cent or to the nearest 1/100th of a share,
as the case may be. Anything in this Section 5(d) to the contrary
notwithstanding, the Corporation shall be entitled to make such reduction in
the Conversion Price, in addition to those required by this Section 5(d), as
it in its discretion shall determine to be advisable in order that any stock
dividend, subdivision of shares, distribution of rights to purchase stock or
securities, or distribution of securities convertible into or exchangeable
for stock hereafter made by the Corporation to its stockholders shall not be
taxable to the recipients. Except as set forth in subsections (i), (ii) and
(iii) above, the Conversion Price shall not be adjusted for any such event
including, without limitation, the issuance of Common Stock, or any
securities convertible into or exchangeable for Common Stock or carrying the
right to purchase any of the foregoing, in exchange for cash, property or
services.
(vii) Whenever the Conversion Price is adjusted as herein provided,
(A) the Corporation promptly shall file with the stock transfer agent a
certificate setting forth the Conversion Price after such adjustment and a
brief statement of the facts requiring such adjustment and the manner of
computing the same, which certificate shall be conclusive evidence of the
correctness of such adjustment, except for arithmetic errors, and (B) the
Corporation also shall deliver or mail, or cause to be delivered or mailed by
first class mail, postage prepaid, as soon as practicable to each holder of
record of shares of Series B Convertible Preferred Stock a notice stating
that the Conversion Price has been adjusted and setting forth the adjusted
Conversion Price. The stock transfer agent shall not be under any duty or
responsibility with respect to the certificate required by this subsection
(vii) except to exhibit the same to any holder of shares of Series B
Convertible Preferred Stock who requests to inspect it.
(viii) In the event that at any time, as a result of an adjustment
made pursuant to subsection (i) of this Section 5(d), the holder of any share
of Series B Convertible Preferred Stock thereafter surrendered for conversion
shall become entitled to receive any shares of the Corporation other than
shares of Common Stock, thereafter the Conversion Price of such other shares
so receivable upon conversion of any share of Series B Convertible Preferred
Stock shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to
Common Stock contained in this Section.
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(ix) The Corporation from time to time may decrease the Conversion
Price by any amount for any period of time if the period is at least 20 days
and if the decrease is irrevocable during the period. Whenever the Conversion
Price is so decreased, the Corporation shall deliver or mail to holders of
record of shares of Series B Convertible Preferred Stock a notice of the
decrease at least 15 days before the date the decreased Conversion Price
takes effect, and such notice shall state the decreased Conversion Price and
the period it will be in effect.
(e) Notice to Holders Prior to Certain Corporate Actions. In case:
----------------------------------------------------
(i) the Corporation shall take any action which would require an
adjustment in the Conversion Price pursuant to Section 5(d)(iii); or
(ii) the Corporation shall authorize the granting to the holders of
its Common Stock generally of rights, options or warrants to subscribe for or
purchase any shares of stock of any class or of any other rights; or
(iii) there shall be any reorganization or reclassification of the
Common Stock (other than a subdivision or combination of the outstanding
Common Stock and other than a change in the par value of the Common Stock),
or any consolidation or merger to which the Corporation is a party or any
statutory exchange of securities with another corporation and for which
approval of any stockholders of the Corporation is required, or any sale,
lease or transfer of all or substantially all of the assets of the
Corporation; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding-up of the Corporation;
then in each such case the Corporation shall cause to be delivered or mailed by
first class mail, postage prepaid, to the holders of shares of Series B
Convertible Preferred Stock and the stock transfer agent, as promptly as
possible, but in any event at least 20 days prior to the applicable date
hereinafter specified, a written notice stating (i) the date on which a record
is to be taken for the purpose of such action or granting of rights, options or
warrants, or, if a record is not to be taken, the date as of which the holders
of Common Stock of record to be entitled to such distribution, rights, options
or warrants are to be determined, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, statutory exchange, sale, lease,
transfer, dissolution, liquidation or winding-up is expected to become effective
or occur, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property
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deliverable upon such reorganization, reclassification, consolidation, merger,
statutory exchange, sale, lease, transfer, dissolution, liquidation or winding-
up. Failure to give such notice or any defect therein shall not affect the
legality or validity or the proceedings described in subsection (i), (ii), (iii)
or (iv) of this Section 5(e).
(f) Reservation of Shares of Common Stock. The Corporation covenants
-------------------------------------
that it will, at all times, reserve and keep available, free from preemptive
rights, out of the aggregate of its authorized but unissued shares of Common
Stock for the purpose of effecting conversions of shares of Series B Convertible
Preferred Stock, the full number of shares of Common Stock deliverable upon the
conversion of all outstanding shares of Series B Convertible Preferred Stock not
theretofore converted and on or before (and as a condition of) taking any action
that would cause an adjustment of the Conversion Price resulting in an increase
in the number of shares of Common Stock deliverable upon conversion above the
number thereof previously reserved and available therefor, the Corporation shall
take all such action so required. For purposes of this Section 5(f), the number
of shares of Common Stock which shall be deliverable upon the conversion of all
outstanding shares of Series B Convertible Preferred Stock shall be computed as
if at the time of computation all outstanding shares of Series B Convertible
Preferred Stock were held by a single holder.
Before taking any action that would cause an adjustment reducing the
Conversion Price below the then par value (if any) of the shares of Common Stock
deliverable upon conversion of the shares of Series B Convertible Preferred
Stock, the Corporation shall take any corporate action which may, in the opinion
of its counsel, be necessary in order that the Corporation may validly and
legally issue fully paid and non-assessable shares of Common Stock at such
adjusted Conversion Price.
(g) Transfer Taxes, Etc. The Corporation shall pay any and all
--------------------
documentary stamp, issue or transfer taxes, and any other similar taxes payable
in respect of the issue or delivery of shares of Common Stock upon conversion of
shares of Series B Convertible Preferred Stock pursuant hereto; provided,
however, that the Corporation shall not be required to pay any tax that may be
payable in respect of any transfer involved in the issue or delivery of shares
of Common Stock in a name other than that of the holder of the shares of Series
B Convertible Preferred Stock to be converted and no such issue or delivery
shall be made unless and until the person requesting such issue or delivery has
paid to the Corporation the amount of any such tax or has established, to the
satisfaction of the Corporation, that such tax has been paid.
(h) Consolidation or Merger or Sale of Assets. Notwithstanding any
-----------------------------------------
other provision herein to the contrary, in
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case of any consolidation or merger to which the Corporation is a party (other
than a merger or consolidation in which the Corporation is the continuing
corporation and in which the Common Stock outstanding immediately prior to the
merger or consolidation is not exchanged for cash, or the securities or other
property of another corporation), or in case of any sale, lease or transfer to
another corporation of the property of the Corporation as an entirety or
substantially as an entirety, then lawful provision shall be made by the
corporation formed by such consolidation or the corporation whose securities,
cash or other property immediately after the merger or consolidation will be
owned, by virtue of the merger or consolidation, by the holders of Common Stock
immediately prior to the merger or consolidation, or the corporation which shall
have acquired such assets or securities of the Corporation (collectively the
"Formed, Surviving or Acquiring Corporation"), as the case may be, providing
that the holder of each share of Series B Convertible Preferred Stock then
outstanding shall have the right thereafter to convert such share into the kind
and amount of securities, cash or other property receivable upon such
consolidation, merger, sale, lease or transfer by a holder of the number of
shares of Common Stock into which such share of Series B Convertible Preferred
Stock might have been converted immediately prior to such consolidation, merger,
sale, lease or transfer assuming such holder of Common Stock did not exercise
his rights of election, if any, as to the kind or amount of securities, cash or
other property receivable upon such consolidation, merger, sale, lease or
transfer (provided that, if the kind or amount of securities, cash or other
property receivable upon such consolidation, merger, sale, lease or transfer is
not the same for each share of Common Stock in respect of which such rights of
election shall not have been exercised ("non-electing share"), then for the
purposes of this Section 5(h) the kind and amount of securities, cash or other
property receivable upon such consolidation, merger, sale, lease or transfer for
each non-electing share shall be deemed to be the kind and amount so receivable
per share by a plurality of the non-electing shares). The Formed, Surviving or
Acquiring Corporation, as the case may be, shall make provision in its
certificate or articles of incorporation or other constituent documents to the
end that the provisions set forth in this Section 5(h) shall thereafter
correspondingly be made applicable, as nearly as may reasonably be, in relation
to any shares of stock or other securities or property thereafter deliverable on
the conversion of the Series B Convertible Preferred Stock.
The above provisions of this Section 5(h) shall similarly apply to
successive consolidations, mergers, sales, leases or transfers.
(i) Covenant as to Common Stock. The Corporation covenants that all
---------------------------
shares of Common Stock which may be delivered upon conversions of shares of
Series B Convertible Preferred Stock will upon delivery be duly and validly
issued and fully
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paid and nonassessable, free of all liens and charges and not subject to any
preemptive rights.
The Corporation will list and keep listed, so long as the Common Stock
shall be listed on The New York Stock Exchange, all Common Stock issuable upon
conversion of the shares of Series B Convertible Preferred Stock.
(6) Voting Rights.
-------------
(a) General. The holders of Series B Convertible Preferred Stock
-------
shall not have any voting rights except as set forth below or as otherwise from
time to time required by law. In connection with any right to vote, each holder
of Series B Convertible Preferred Stock will have one vote for each share held.
Any shares of Series B Convertible Preferred Stock held by the Corporation or
any entity controlled by the Corporation shall not have voting rights hereunder
and shall not be counted in determining the presence of a quorum.
(b) Default Voting Rights. Whenever dividends on the Series B
---------------------
Convertible Preferred Stock shall be in arrears in an amount equal to at least
six quarterly dividend payments (whether or not consecutive), (i) the number of
members of the Board of Directors of the Corporation shall be increased by two,
effective as of the time of election of such directors as hereinafter provided,
and (ii) the holders of the Series B Convertible Preferred Stock (voting as a
class together with all other affected classes or series of the Parity Dividend
Stock upon which like voting rights have been conferred and are exercisable
(other than the Series A Preferred Stock)) will have the exclusive right to vote
for and elect such two additional directors of the Corporation at any meeting of
stockholders of the Corporation at which directors are to be elected held during
the period such dividends remain in arrears. The right of the holders of the
Series B Convertible Preferred Stock to vote for such two additional directors
shall terminate when all accrued and unpaid dividends on the Series B
Convertible Preferred Stock have been declared and paid or set apart for
payment. The term of office of all directors so elected shall terminate
immediately upon the termination of the right of the holders of the Series B
Convertible Preferred Stock and such Parity Dividend Stock to vote for such two
additional directors.
The foregoing right of the holders of the Series B Convertible
Preferred Stock with respect to the election of two directors may be exercised
at any annual meeting of stockholders or at any special meeting of stockholders
held for such purpose. If the right to elect directors shall have accrued to the
holders of the Series B Convertible Preferred Stock more than 90 days preceding
the date established for the next annual meeting of stockholders, the President
of the Corporation shall, within 20 days after the delivery to the Corporation
at its principal office of a written request for a special meeting signed by the
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holders of at least ten percent (10%) of the Series B Convertible Preferred
Stock then outstanding, call a special meeting of the holders of the Series B
Convertible Preferred Stock to be held within 60 days after the delivery of such
request for the purpose of electing such additional directors.
The holders of the Series B Convertible Preferred Stock and any such
Parity Dividend Stock referred to above (excluding the holders of Series A
Preferred Stock) voting together shall have the right to remove without cause at
any time and replace any directors such holders have elected pursuant to this
Section 6.
(c) Class Voting Rights. So long as the Series B Convertible
-------------------
Preferred Stock is outstanding, the Corporation shall not, without the
affirmative vote or consent of the holders of at least 66 2/3 percent of all
outstanding shares of Series B Convertible Preferred Stock (unless the vote or
consent of a greater percentage is required by applicable law or the Restated
Certificate of Incorporation, as amended, of the Corporation), voting separately
as a class, (i) amend, alter or repeal (by merger, consolidation or otherwise)
any provision of the Restated Certificate of Incorporation, as amended, or the
Bylaws of the Corporation, as amended, so as to affect adversely the relative
rights, preferences, qualifications, limitations or restrictions of the Series B
Convertible Preferred Stock, (ii) authorize or issue, or increase the authorized
amount of, any additional class or series of stock, or any security convertible
into stock of such class or series, ranking prior to the Series B Convertible
Preferred Stock in respect of the payment of dividends or upon liquidation,
dissolution or winding up of the Corporation or (iii) effect any
reclassification of the Series B Convertible Preferred Stock. A class vote on
the part of the Series B Convertible Preferred Stock, without limitation,
specifically shall not be deemed to be required (except as otherwise required by
law or resolution of the Board of Directors of the Corporation) in connection
with: (a) the authorization, issuance or increase in the authorized amount of
any shares of any other class or series of stock that ranks junior to, or on a
parity with, the Series B Convertible Preferred Stock in respect of the payment
of dividends and upon liquidation, dissolution or winding up of the Corporation;
or (b) the authorization, issuance or increase in the amount of any notes,
bonds, mortgages, debentures or other obligations of the Corporation not
convertible into or exchangeable, directly or indirectly, for stock ranking
prior to the Series B Convertible Preferred Stock in respect of the payment of
dividends or upon liquidation, dissolution or winding up of the Corporation.
(7) Outstanding Shares. For purposes of this Certificate of Designations,
------------------
all shares of Series B Convertible Preferred Stock shall be deemed outstanding
except (i) from the date fixed for redemption pursuant to Section 4, all shares
of Series B Convertible Preferred Stock that have been so called for
-18-
redemption under Section 4 if the cash necessary for payment of the Redemption
Price irrevocably has been set aside; (ii) from the date of surrender of
certificates representing shares of Series B Convertible Preferred Stock, all
shares of Series B Convertible Preferred Stock converted into Common Stock; and
(iii) from the date of registration of transfer, all shares of Series B
Convertible Preferred Stock held of record by the Corporation or any subsidiary
of the Corporation.
(8) No Other Rights and Powers. The shares of Series B Convertible
--------------------------
Preferred Stock shall not have any relative, participating, optional or other
special rights and powers other than as set forth herein.
(9) Preemptive Rights. The Series B Convertible Preferred Stock is not
-----------------
entitled to any preemptive or subscription rights in respect of any securities
of the Corporation.
(10) Severability of Provisions. Whenever possible, each provision hereof
--------------------------
shall be interpreted in a manner as to be effective and valid under applicable
law, but if any provision hereof is held to be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating or otherwise adversely affecting
the remaining provisions hereof. If a court of competent jurisdiction should
determine that a provision hereof would be valid or enforceable if a period of
time were extended or shortened or a particular percentage were increased or
decreased, then such court may make such change as shall be necessary to render
the provision in question effective and valid under applicable law.
"FURTHER RESOLVED, that each officer of the Corporation hereby is
authorized, in the name and on behalf of the Corporation, to prepare, execute,
seal and file, or cause to be prepared, executed, sealed and filed, the
Certificate of Designations relating to the Series B Convertible Preferred Stock
in accordance with the Delaware General Corporation Law and to take any and all
such action with respect thereto that such officer of the Corporation shall deem
necessary or advisable; and
"FURTHER RESOLVED, that each officer of the Corporation hereby is
authorized, in the name and on behalf of the Corporation, to execute and
deliver, or cause to be made, executed and delivered, all such officers'
certificates and such other agreements, undertakings, documents or instruments
and to perform such other acts as such officer may deem necessary or appropriate
in order to effectuate the purpose and intent of these resolutions;
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IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
executed in its name by Richard B. Esser, its Vice President, and attested by
its Secretary, this 4th day of August, 1994.
AMAX GOLD INC.
By: /s/ Richard B. Esser
--------------------------------
Richard B. Esser
Vice President
Attest:
By: /s/ Paul J. Hemschoot, Jr.
------------------------------
Paul J. Hemschoot, Jr.
Secretary
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