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EXHIBIT 3.1
AMENDED AND RESTATED CHARTER
OF
REGAL CINEMAS, INC.
The undersigned corporation under the Tennessee Business
Corporation Act, adopts the following restated charter:
1. The name of the corporation is Regal Cinemas, Inc.
2. The corporation is for profit.
3. The street address of the corporation's principal office
is:
7132 Commercial Park Drive
Knoxville, Tennessee 37918
County of Knox.
4. (a) The name of the corporation's registered agent is
Corporation Service Company.
(b) The street address of the corporation's registered
office in Tennessee is:
500 Tallan Building
Two Union Square
Chattanooga, TN 37402
5. The corporation is authorized to issue two classes of stock
in the following number of shares: (i) 500,000,000 shares of common stock, no
par value (the "Common Stock"), and (ii) 100,000,000 shares of preferred stock,
no par value (the "Preferred Stock").
The preferences, limitations and relative rights of the above
two classes of stock shall be as follows:
A. Preferred Stock.
(1) Shares of Preferred Stock may be issued in one or more
series at such time or times and for such consideration as the Board of
Directors may determine. Each such series shall be given a distinguishing
designation. All shares of any one series shall have preferences, limitations
and relative rights identical with those of other shares of the same series and,
except to the extent otherwise provided in the description of such series, with
those of other shares of Preferred Stock.
(2) Authority is hereby expressly granted to the Board of
Directors to fix from time to time, by resolution or resolutions providing for
the establishment and/or issuance of any series of Preferred Stock, the
designation of such series and preferences, limitations and relative rights of
the shares of such series, including the following:
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(a) The distinctive designation and number of shares
comprising such series, which number may (except where otherwise
provided by the Board of Directors in creating such series) be
increased or decreased (but not below the number of shares then
outstanding) from time to time by action of the Board of Directors;
(b) The voting rights, if any, which shares of that
series shall have, which may be special, conditional, limited or
otherwise;
(c) The rate of dividends, if any, on the shares of
that series, whether dividends shall be non-cumulative, cumulative to
the extent earned, partially cumulative or cumulative (and, if
cumulative, from which date or dates), whether dividends shall be
payable in cash, property rights, or in shares of the corporation's
capital stock, and the relative rights of priority, if any, of payment
of dividends on shares of that series over shares of any other series
or over the Common Stock;
(d) Whether the shares of that series shall be
redeemable and, if so, the terms and conditions of such redemption,
including the date or dates upon or after which they shall be
redeemable, the event or events upon or after which they shall be
redeemable, whether they shall be redeemable at the option of the
corporation, the stockholder or another person, the amount per share
payable in case of redemption (which amount may vary under different
conditions and at different redemption dates), whether such amount
shall be a designated amount or an amount determined in accordance with
a designated formula or by reference to extrinsic data or events and
whether such amount shall be paid in cash, indebtedness, securities or
other property rights, including securities of any other corporation;
(e) Whether that series shall have a sinking fund for
the redemption or purchase of shares of that series and, if so, the
terms of and amount payable into such sinking fund;
(f) The rights to which the holders of the shares
shall be entitled in the event of voluntary or involuntary dissolution
or liquidation of the corporation, and the relative rights of priority,
if any, of payment of shares of that series over shares of any other
series or over the Common Stock in any such event;
(g) Whether the shares of that series shall be
convertible into or exchangeable for cash, shares of stock of any other
class or any other series, indebtedness, or other property or rights,
including securities of another corporation, and if so, the terms and
conditions of such conversion or exchange, including the rate or rates
of
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conversion or exchange, and whether such rate shall be a designated
amount or an amount determined in accordance with a designated formula
or by reference to extrinsic data or events, the date or dates upon or
after which they shall be convertible or exchangeable, the duration for
which they shall be convertible or exchangeable, the event or events
upon or after which they shall be convertible or exchangeable, and
whether they shall be convertible or exchangeable at the option of the
corporation, the shareholder or another person, and the method (if any)
of adjusting the rate of conversion or exchange in the event of a stock
split, stock dividend, combination of shares of similar event;
(h) Whether the issuance of any additional shares of
such series, or of any shares of any other series, shall be subject to
restrictions as to issuance, or as to the powers, preferences or rights
of any such other series; and
(i) Any other preferences, privileges and powers and
relative, participating, optional or other special rights and
qualifications, limitations or restrictions of such series, as the
Board of Directors may deem advisable and as shall not be inconsistent
with the provisions of this Article 5 and to the full extent now or
hereafter permitted by the laws of the State of Tennessee.
Before issuing any shares of a series of Preferred
Stock, the corporation shall deliver to the Secretary of State for
filing Articles of Amendment, which shall be effective without
shareholder action, that set forth (a) the name of the corporation, (b)
the text of the amendment determining the terms of the series, (c) the
date it was adopted and (d) a statement that the amendment was duly
adopted by the Board of Directors.
A series of Preferred Stock was designated by the
Board of Directors on May 26, 1998 as follows:
(1) Designation. The designation of a series of
Preferred Stock, no par value, shall be "Series A Convertible
Preferred Stock" (the "Series A Convertible Preferred Stock")
consisting of 16,000 shares. The liquidation preference of the
Series A Convertible Preferred Stock shall be $50,000 per
share (the "Liquidation Preference"), which value does not
represent a determination by the Board of Directors for the
purposes of the capital accounts.
(2) Rank. The Series A Convertible Preferred
Stock shall, with respect to dividend rights and rights on
liquidation, winding up and dissolution, rank prior to the
Common Stock, no par value (the "Common Stock"), of the
Corporation. (All equity securities of the
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Corporation to which the Series A Convertible Preferred Stock
ranks prior, including the Common Stock, are collectively
referred to herein as the "Junior Securities", all equity
securities of the Corporation with which the Series A
Convertible Preferred Stock ranks on a parity are collectively
referred to herein as the "Parity Securities" and all equity
securities of the Corporation (other than convertible debt
securities) to which the Series A Convertible Preferred Stock
ranks junior, whether with respect to dividends or upon
liquidation, dissolution, winding up or otherwise, are
collectively referred to herein as the "Senior Securities".)
The Series A Convertible Preferred Stock shall be subject to
the creation of Junior Securities, Parity Securities and
Senior Securities.
(3) Dividends. (i) The holders of the shares of
Series A Convertible Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors,
out of funds legally available for the payment of dividends,
cumulative cash dividends at the rate of 12% of the
Liquidation Preference per share per annum, and no more. Such
dividends shall be payable in annual payments on each
anniversary of the first date on which any shares of Series A
Convertible Preferred Stock shall be issued (the "Date of
Initial Issuance"), commencing with the first such anniversary
date (each of such dates, a "dividend payment date"), in
preference to dividends on the Junior Securities. Such
dividends shall be paid to the holders of record at the close
of business on the day immediately preceding the dividend
payment date (each of such dates, a "dividend payment record
date"). Each of such annual dividends shall be fully
cumulative and shall accrue (whether or not declared), without
interest, from the previous dividend payment date, except
that, with respect to the first dividend, such dividend shall
accrue from the Date of Initial Issuance. Dividends payable
for any partial dividend period shall be calculated on the
basis of a 360-day year and the actual number of days elapsed
in the period for which payable. Notwithstanding anything
herein to the contrary, no dividends shall be paid or payable
on shares of Series A Convertible Preferred Stock to the
extent such shares are converted pursuant to paragraph (5)
prior to the first dividend payment date.
(ii) All dividends paid with respect to
shares of the Series A Convertible Preferred Stock pursuant to
paragraph (3)(i) shall be paid pro rata to the holders
entitled thereto.
(iii) No full dividends shall be declared by the
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Board of Directors or paid or set apart for payment by the
Corporation on any Parity Securities, nor shall the
Corporation make any distribution in respect of any Parity
Securities, either directly or indirectly, and whether in
cash, obligations or shares of the Corporation or other
property, for any period unless full cumulative dividends have
been or contemporaneously are declared and paid or declared
and a sum set apart sufficient for such payment on the Series
A Convertible Preferred Stock for all dividend payment periods
terminating on or prior to the date of payment, or setting
apart for payment, of such full dividends on such Parity
Securities. If any dividends are not paid in full, as
aforesaid, upon the shares of the Series A Convertible
Preferred Stock and any other Parity Securities, all dividends
or distributions declared upon shares of the Series A
Convertible Preferred Stock and any other Parity Securities
shall be declared pro rata so that the amount of dividends or
distributions declared per share of the Series A Convertible
Preferred Stock and such Parity Securities shall in all cases
bear to each other the same ratio that accrued dividends per
share on the Series A Convertible Preferred Stock and such
Parity Securities bear to each other. No interest, or sum of
money in lieu of interest, shall be payable in respect of any
dividend payment or payments on the Series A Convertible
Preferred Stock or any other Parity Securities which may be in
arrears. Any dividend not paid pursuant to paragraph (3)(i)
hereof or this paragraph (3)(iii) shall be fully cumulative
and shall accrue (whether or not declared), without interest,
as set forth in paragraph (3)(i) hereof.
(iv) (a) Holders of shares of the Series A
Convertible Preferred Stock shall be entitled to receive the
dividends provided for in paragraph (3)(i) hereof in
preference to and in priority over any dividends upon any of
the Junior Securities.
(b) So long as any shares of the Series A
Convertible Preferred Stock are outstanding, the Board of
Directors shall not declare, and the Corporation shall not pay
or set apart for payment any dividend on any of the Junior
Securities or make any payment on account of, or set apart for
payment money for a sinking or other similar fund for, the
repurchase, redemption or other retirement of, any of the
Junior Securities or Parity Securities or any warrants, rights
or options exercisable for or convertible into any of the
Junior Securities or Parity Securities (other than the
repurchase, redemption or other retirement of debentures or
other debt securities that are convertible or exchangeable
into any of the Junior
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Securities or Parity Securities), or make any distribution in
respect of the Junior Securities, either directly or
indirectly, and whether in cash, obligations or shares of the
Corporation or other property (other than distributions or
dividends in Junior Securities to the holders of Junior
Securities), and shall not permit any corporation or other
entity directly or indirectly controlled by the Corporation to
purchase or redeem any of the Junior Securities or Parity
Securities or any warrants, rights, calls or options
exercisable for or convertible into any of the Junior
Securities or Parity Securities (other than the repurchase,
redemption or other retirement of debentures or other debt
securities that are convertible or exchangeable into any of
the Junior Securities or Parity Securities) unless prior to or
concurrently with such declaration, payment, setting apart for
payment, repurchase, redemption or other retirement or
distribution, as the case may be, all accrued and unpaid
dividends on shares of the Series A Convertible Preferred
Stock not paid on the dates provided for in paragraph (3)(i)
hereof (including accrued dividends not paid by reason of the
terms and conditions of paragraph (3)(iii) hereof) shall have
been or be paid.
(v) Subject to the foregoing provisions of this
paragraph (3), the Board of Directors may declare and the
Corporation may pay or set apart for payment dividends and
other distributions on any of the Junior securities or Parity
Securities, and may repurchase, redeem or otherwise retire any
of the Junior Securities or Parity Securities or any warrants,
rights or options exercisable for or convertible into any of
the Junior Securities or Parity Securities, and the holders of
the shares of the Series A Convertible Preferred Stock shall
not be entitled to share therein.
(4) Liquidation Preference. (i) In the event of
any voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Corporation, the holders of
shares of Series A Convertible Preferred Stock then
outstanding shall be entitled to be paid out of the assets of
the Corporation available for distribution to its shareholders
an amount in cash equal to the Liquidation Preference for each
share outstanding, plus an amount in cash equal to all accrued
but unpaid dividends thereon to the date of liquidation,
dissolution or winding up before any payment shall be made or
any assets distributed to the holders of any of the Junior
Securities. If the assets of the Corporation are not
sufficient to pay in full the liquidation payments payable to
the holders of outstanding shares of the Series A Convertible
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Preferred Stock and any Parity Securities, then the holders of
all such shares shall share ratably in such distribution of
assets in accordance with the amount which would be payable on
such distribution if the amounts to which the holders of
outstanding shares of Series A Convertible Preferred Stock and
the holders of outstanding shares of such Parity Securities
are entitled were paid in full. Except as provided in this
paragraph (4)(i), holders of Series A Convertible Preferred
Stock shall not be entitled to any distribution in the event
of liquidation, dissolution or winding up of the affairs of
the Corporation.
(ii) For the purposes of this paragraph (4), neither
the voluntary sale, conveyance, lease, exchange or transfer
(for cash, shares of stock, securities or other consideration)
of all or substantially all of the property or assets of the
Corporation nor the consolidation or merger of the Corporation
with or into one or more other corporations nor the
consolidation or merger of one or more corporations with or
into the Corporation shall be deemed to be a voluntary or
involuntary liquidation, dissolution or winding up.
(5) Conversion. (i) (a) Upon the terms and in
the manner set forth in this paragraph (5) and subject to the
provisions for adjustment contained in paragraph (5)(vi), each
share of the Series A Convertible Preferred Stock shall be
convertible, at the option of the holder thereof at any time
upon surrender to the Corporation of the certificates for the
shares to be converted, into a number of fully paid and
nonassessable shares of Common Stock equal to the aggregate
Liquidation Preference of the Series A Convertible Preferred
Stock to be converted divided by a conversion price of $50,000
(as such conversion price may be adjusted in accordance with
paragraph (5), the "Conversion Price").
(b) In order to convert shares of the Series A
Convertible Preferred Stock pursuant to paragraph (5)(i)(a),
the holder thereof shall (1) deliver a properly completed and
duly executed written notice of election to convert specifying
the number of shares of the Series A Convertible Preferred
Stock to be converted and the name or names in which such
holder wishes the certificate or certificates for shares of
Common Stock to be issued to the Corporation at its principal
office or at the office of the agency which may be maintained
for such purpose and identified in written a notice to the
holders of the shares of Series A Convertible Preferred Stock
(the "Conversion Agent", which term, if the Corporation
determines to act in such capacity, shall include the
Corporation in such
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capacity), (2) surrender the certificate for such shares of
Series A Convertible Preferred Stock to the Conversion Agent,
accompanied, if so required by the Conversion Agent, by a
written instrument or instruments of transfer in form
reasonably satisfactory to the Conversion Agent duly executed
by the holder or his attorney duly authorized in writing, and
(3) pay any transfer tax or similar tax required by paragraph
(5)(viii).
(ii) (a) Upon the terms and in the manner set
forth in this paragraph (5) and subject to the provisions for
adjustment contained in paragraph (5)(vi), at the close of
business on the seventh day after the Date of Initial
Issuance, without any action on the part of the Corporation or
the holders of shares of Series A Convertible Preferred Stock,
each share of Series A Convertible Preferred Stock issued and
outstanding immediately prior to such day shall automatically
be converted into a number of fully paid and nonassessable
shares of Common Stock equal to the aggregate Liquidation
Preference of the Series A Convertible Preferred Stock then
converted divided by the Conversion Price.
(b) In order to receive the certificate or
certificates representing the shares of Common Stock into
which the Series A Convertible Preferred Stock shall have been
converted, as provided in paragraph (5)(ii)(a), the holder
thereof shall (1) surrender the certificate or certificates
for such shares of Series A Convertible Preferred Stock to the
Conversion Agent (which shall be deemed to be the Corporation,
unless the Corporation shall have identified another person to
act in such capacity by written notice to the holders of the
shares of Series A Convertible Preferred Stock), accompanied,
if so required by the Conversion Agent, by a written
instrument or instruments of transfer in form reasonably
satisfactory to the Conversion Agent duly extended by the
holder or his attorney duly authorized in writing, and (2) pay
any transfer or similar tax required by paragraph (5)(viii).
(iii) (a) Conversion shall be deemed to have been
effected at the close of business on the date (the "Conversion
Date") (1) in the case of conversion pursuant to paragraph
(5)(i), on which the Conversion Agent shall have received the
notice of election to convert, the surrendered certificate,
any required payments and all other required documents, or (2)
in the case of conversion pursuant to paragraph (5)(ii), at
the time specified in paragraph (5)(ii). Immediately upon
conversion, the rights of the holders of converted shares of
Series A Convertible Preferred
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Stock shall cease and the persons entitled to receive the
shares of Common Stock upon the conversion of such shares of
Series A Convertible Preferred Stock shall be treated for all
purposes as having become the beneficial owners of such shares
of Common Stock. Conversion shall be at the Conversion Price
in effect on the Conversion 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 of the Common Stock at
the close of business on the next succeeding day on which such
stock transfer books are open, but such conversion shall be at
the Conversion Price (as adjusted after the Conversion Date
pursuant to paragraph (5)(vi) for any event requiring such
adjustment which occurs on or prior to the close of business
on such next succeeding day) in effect on the Conversion Date.
(b) As promptly as practicable after the
Conversion Date, subject to the receipt by the Conversion
Agent of the certificates formerly representing the converted
shares of Series A Convertible Preferred Stock, the
Corporation shall deliver or cause to be delivered at the
office or agency of the Conversion Agent, to or upon the
written order of the holder of the surrendered shares of
Series A Convertible Preferred Stock, a certificate or
certificates representing the number of fully paid and
nonassessable shares of Common Stock into which such shares of
Series A Convertible Preferred Stock have been converted in
accordance with the provisions of this paragraph (5).
(c) Upon the surrender of a certificate representing
shares of Series A Convertible Preferred Stock that is
converted in part, the Corporation shall issue or cause to be
issued to the holder a new certificate representing shares of
Series A Convertible Preferred Stock equal in number to the
unconverted portion of the shares of Series A Convertible
Preferred Stock represented by the certificate so surrendered.
(iv) [Reserved.]
(v) The holders of shares of Series A Convertible
Preferred Stock at the close of business on a dividend payment
record date shall be entitled to receive the dividend payable
on such shares on the corresponding dividend payment date
notwithstanding the conversion thereof or the Corporation's
default in payment of the dividend due on such dividend
payment date.
(vi) The Conversion Price shall be subject to
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adjustment from time to time as follows:
(a) If the Corporation shall, after the
effective time of the merger of Screen Acquisition
Corp. and Monarch Acquisition Corp. with and into the
Corporation (the "Effective Time"), (w) declare or
pay a dividend on its outstanding Common Stock in
shares of Common Stock or make a distribution to all
holders of its Common Stock in shares of Common
Stock, (x) subdivide its outstanding shares of Common
Stock into a greater number of shares of Common
Stock, (y) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock
or (z) issue by reclassification of its shares of
Common Stock other securities of the Corporation,
then the Conversion Price in effect immediately prior
thereto shall be adjusted so that the holder of any
shares of Series A Convertible Preferred Stock
thereafter converted shall be entitled to receive the
number and kind of shares of Common Stock or other
securities that the holder would have owned or have
been entitled to receive after the happening of any
of the events described above had such shares of
Series A Convertible Preferred Stock been converted
immediately prior to the happening of such event or
any record date with respect thereto. An adjustment
made pursuant to this paragraph (5)(vi)(a) shall
become effective immediately after the record date
for the dividend payment, subdivision, combination or
issuance, if any, or, if there is no such record
date, then on the date of such event. Such
adjustments shall be made successively.
(b) If the Corporation shall, after the
Effective Time, issue to all holders of its Common
Stock rights, options, warrants or convertible or
exchangeable securities containing the right to
subscribe for or purchase shares of Common Stock at a
price per share that is lower than the then current
market price per share of Common Stock (as defined in
paragraph (5)(vi)(e) below) at the record date
mentioned below, the Conversion Price shall be
adjusted in accordance with the following formula:
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( N x P )
-----
AC = C x O + ( M )
-------------
O + N
where
AC = the adjusted Conversion Price.
C = the current Conversion Price.
O = the number of shares of Common Stock
outstanding on the record date.
N = the number of additional shares of
Common Stock offered.
P = the offering price per share of the
additional shares.
M = the current market price per share of
Common Stock on the record date.
The adjustment shall be made successively whenever
any such rights, options, warrants or convertible or
exchangeable securities are issued, and shall become
effective immediately after the record date for the
determination of shareholders entitled to receive the
rights, options, warrants or convertible or
exchangeable securities. Upon the expiration of any
such rights, options, warrants or convertible or
exchangeable securities, if any thereof shall not
have been exercised, then the Conversion Price shall
be increased by the amounts of the initial adjustment
of the Conversion Price pursuant to this paragraph
(5)(vi) in respect of such expired rights, options,
warrants or convertible or exchangeable securities.
(c) If the Corporation shall, after the
Effective Time, distribute to all holders of its
outstanding Common Stock any shares of capital stock
of the Corporation (other than Common Stock) or
evidences of its indebtedness or assets (including
shares of capital stock of a subsidiary of the
Corporation, but excluding dividends or distributions
referred to in paragraphs (5)(vi)(a) and (b) above)
or rights or warrants to subscribe for or purchase
any of its securities (excluding those referred to in
paragraph (5)(vi)(b) above) or shall repurchase
(including any repurchase by a subsidiary of the
Corporation) shares of the Corporation's outstanding
Common Stock for per share consideration that is
greater than the then current market price share of
Common Stock (as
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defined in paragraph (5)(vi)(e) below) immediately prior to
such repurchase (in which event the aggregate amount so paid
in excess of the aggregate current market price per share of
all the Common Stock divided by the number of outstanding
shares of Common Stock prior to such repurchase shall be
considered a distribution of assets to all holders of Common
Stock pursuant to this paragraph) (any of the foregoing being
hereinafter in this paragraph (5)(vi) called the "Securities
or Assets"), then in each such case, unless the Corporation
elects to reserve shares or other units of such Securities or
Assets for distribution to the holders of the Series A
Convertible Preferred Stock upon the conversion of the shares
of Series A Convertible Preferred Stock so that any such
holder converting shares of Series A Convertible Preferred
Stock will receive upon such conversion, in addition to the
shares of the Common Stock to which such holder is entitled,
the amount and kind of such Securities or Assets which such
holder would have received if such holder had, immediately
prior to the record date for the distribution of the
Securities or Assets, converted its shares of Series A
Convertible Preferred Stock into Common Stock, 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 date of such distribution by a
fraction of which the numerator shall be the current market
price per share (as defined in paragraph (5)(vi)(e) below) of
the Common Stock on the record date mentioned below less the
then fair market value (as determined by the Board of
Directors, whose determination shall, if made in good faith,
be conclusive) of the portion of such Securities or Assets so
distributed or applicable to one share of Common Stock, as the
case may be, and of which the denominator shall be the current
market price per share of the Common Stock on such record
date. Such adjustment shall become effective immediately after
the record date for the determination of shareholders entitled
to receive such distribution, except as provided in paragraph
(5)(vi)(k) below.
(d) If the Corporation shall, after the Effective
Time, sell and issue any shares of Common Stock, rights,
options, warrants or convertible or exchangeable securities
containing the right to subscribe for or purchase shares of
Common Stock (excluding (i) shares of Common Stock, rights,
options, warrants or convertible or
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exchangeable securities containing the right to subscribe for
or purchase shares of Common Stock issued in any of the
transactions described in paragraphs (a) and (b) above; (ii)
stock options and shares of Common Stock issued to, or
issuable upon the exercise of stock options granted to or to
be granted to, employees or directors of the Corporation or
its subsidiaries; (iii) shares of Common Stock issuable upon
exercise of warrants previously issued; and (iv) shares issued
upon conversion of shares of Series A Convertible Preferred
Stock), at a price per share (determined, in the case of
rights, options, warrants or convertible or exchangeable
securities, by dividing (x) the total amount received or
receivable by the Corporation in consideration of the sale and
issuance of such rights, options, warrants or convertible or
exchangeable securities, plus the total consideration payable
to the Corporation upon exercise or conversion or exchange
thereof, by (y) the total number of shares of Common Stock
covered by such rights, options, warrants or convertible or
exchangeable securities) that is lower than the then current
market price per share of Common Stock (as defined in
paragraph (5)(vi)(e) below) immediately prior to such sale and
issuance, then in each case the Conversion Price shall be
adjusted so that it equals "AC" as determined pursuant to the
formula set forth in paragraph 5(vi)(b). For the purposes of
such adjustments, the shares of Common Stock which the holder
of any such rights, options, warrants, or convertible or
exchangeable securities shall be entitled to subscribe for or
purchase shall be deemed to be issued and outstanding as of
the date of such sale and issuance, and the consideration
received or receivable by the Corporation therefor shall be
deemed to be the consideration received or receivable by the
Corporation (plus any discounts or commissions in connection
therewith) for such rights, options, warrants or convertible
or exchangeable securities, plus the consideration or premiums
stated in such rights, options, warrants or convertible or
exchangeable securities to be paid for the shares of Common
Stock purchasable thereby. In case the Corporation shall (i)
sell and issue shares of Common Stock for consideration
consisting, in whole or in part, of property other than cash
or its equivalent or (ii) sell and issue shares of Common
Stock together with one or more other securities as part of a
unit at a price per unit, then in determining the "price per
share" and the "consideration received or receivable by
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the Corporation" for purposes of the first sentence and the
immediately preceding sentence of this paragraph (5)(vi)(d),
the Board of Directors shall determine, in its discretion, the
fair value of said property or the shares of Common Stock then
being sold as part of such unit, as the case may be, and such
determinations, if made in good faith, shall be conclusive.
The adjustment shall be made successively whenever any such
shares of Common Stock, rights, options, warrants or
convertible or exchangeable securities containing the right to
subscribe for or purchase shares of Common Stock are issued
for less then the current market price, subject to the
exceptions noted above, and shall become effective immediately
after the issue date.
Notwithstanding the foregoing, no adjustments of any
kind under this paragraph (5)(vi)(d) shall be made with
respect to the sale and issuance by the Corporation of any
shares of Common Stock, rights, options, warrants or
convertible or exchangeable securities containing the right to
subscribe for or purchase shares of Common Stock in connection
with either (1) an underwritten public offering or (2) any
transaction as to which the Corporation has received a written
opinion of a nationally recognized investment bank stating
that the transaction is fair to the Corporation from a
financial point of view.
(e) For the purposes of any computation under
paragraphs (5)(vi)(b), (c) and (d), "the current market price
per share" of Common Stock at any date shall be deemed to be
the then current Conversion Price (before giving effect to any
adjustment with respect to which the current market price per
share is being determined).
(f) No adjustment in the Conversion Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% of such price; provided, however, that
any adjustments which by reason of this paragraph (5)(vi)(f)
are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations
under this paragraph (5)(vi) shall be made to the nearest
one-hundredth of a cent or to the nearest one-hundredth of a
share, as the case may be.
(g) If the Corporation shall, after the Effective
Time, be a party to any transaction (including without
limitation any (i)
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recapitalization or reclassification of the Common Stock
(other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a
subdivision or combination of the Common Stock), (ii) any
consolidation or merger of the Corporation with or into any
other person or any merger of another person into the
Corporation (other than a merger which does not result in a
reclassification, conversion, exchange or cancellation of
outstanding shares of Common Stock of the Corporation), (iii)
any sale or transfer of all or substantially all of the assets
of the Corporation or (iv) any compulsory share exchange)
pursuant to which all or substantially all of the Common Stock
shall be exchanged for, converted into, acquired for or
constitute solely the right to receive cash, securities,
property or other assets, then appropriate provision shall be
made as part of the terms of such transaction whereby (1) in
the case of any such transaction not constituting a Common
Stock Fundamental Change (as defined in paragraph (5)(vi)(i))
and subject to funds being legally available therefor at the
time of such conversion, the holder of each share of Series A
Convertible Preferred Stock then outstanding shall thereafter
have the right to convert such share only into the kind and
amount of securities, cash and other property receivable upon
such transaction by a holder of the number of shares of Common
Stock into which such share of Series A Convertible Preferred
Stock might have been converted immediately prior to such
transaction, after giving effect, in the case of any Non-Stock
Fundamental Change (as defined in paragraph (5)(vi)(i)), to
any adjustment in the Conversion Price required by the
provisions of paragraph (5)(vi)(h)(I) and (2) in the case of a
Common Stock Fundamental Change, the holder of each share of
Series A Convertible Preferred Stock then outstanding shall
thereafter have the right to convert such share only into
common stock of the kind received by holders of Common Stock
as a result of such Common Stock Fundamental Change in an
amount determined pursuant to the provisions of paragraph
(5)(vi)(h)(II). The Corporation or the person formed by such
consolidation or resulting from such merger or which acquired
such assets or which acquired the Corporation's shares, as the
case may be, shall make provisions in its certificate or
articles of incorporation or other constituent document to
establish such right. Such certificate or articles of
incorporation or other constituent document shall provide for
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adjustments which, for events subsequent to the effective date
of such certificate or articles of incorporation or other
constituent document, shall be as nearly equivalent as may be
practicable to the adjustments provided for in this paragraph
(5)(vi). The above provisions shall similarly apply to
successive transactions of the type described in this
paragraph (5)(vi)(g).
(h) Notwithstanding any other provision in this
paragraph (5)(vi) to the contrary, if any Fundamental Change
(as defined in paragraph (5)(vi)(i)) occurs after the
Effective Time, then the Conversion Price in effect will be
adjusted immediately after such Fundamental Change (which for
purposes of such adjustment shall be deemed to occur on the
earlier of the occurrence of such Fundamental Change and the
date, if any, fixed for determination of shareholders entitled
to receive the cash, securities, property or other assets
distributable in such Fundamental Change to holders of the
Common Stock) as described below:
(I) In the case of a Non-Stock Fundamental
Change, the Conversion Price immediately following
such Non-Stock Fundamental Change shall be the lower
of (A) the Conversion Price in effect immediately
prior to such Non-Stock Fundamental Change, but after
giving effect to any other prior adjustments effected
pursuant to this paragraph (5)(vi), and (B) the
product of (1) the Applicable Price (as defined in
paragraph (5)(vi)(i)) and (2) a fraction, the
numerator of which is $50,000 and the denominator of
which is (x) $50,000 plus (y) an amount equal to
accrued and unpaid cumulative dividends thereon to
but excluding the date of such Non-Stock Fundamental
Change.
(II) In the case of a Common Stock
Fundamental Change, the Conversion Price immediately
following such Common Stock Fundamental Change shall
be the Conversion Price in effect immediately prior
to such Common Stock Fundamental Change, but after
giving effect to any other prior adjustments effected
pursuant to this paragraph (5)(vi), multiplied by a
fraction, the numerator of which is the Purchaser
Stock Price (as defined in paragraph (5)(vi)(i)) and
the denominator of which is the Applicable Price;
provided, however, that in the event of a Common
Stock Fundamental Change in which (A)
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100% of the value of the consideration received by a
holder of Common Stock is common stock of the
successor, acquiror or other third party (and cash,
if any, paid with respect to any fractional interests
in such common stock resulting from such Common Stock
Fundamental Change) and (B) all of the Common Stock
shall have been exchanged for, converted into or
acquired for such common stock (and any cash paid
with respect to fractional interests) of the
successor, acquiror or other third party, the
Conversion Price immediately following such Common
Stock Fundamental Change shall be the Conversion
Price in effect immediately prior to such Common
Stock Fundamental Change multiplied by a fraction,
the numerator of which is one and the denominator of
which is the number of shares of common stock of the
successor, acquiror or other third party received by
a holder of one share of Common Stock as a result of
such Common Stock Fundamental Change.
(i) For purposes of this paragraph (5):
"Applicable Price" shall mean (i) in the
event of a Non-Stock Fundamental Change in which the
holders of the Common Stock receive only cash, the
amount of cash received by the holder of one share of
Common Stock and (ii) in the event of any other
Non-Stock Fundamental Change or any Common Stock
Fundamental Change, the current market price per
share (as defined in paragraph (5)(vi)(e)) of Common
Stock on the date fixed for the determination of the
holders of Common Stock entitled to receive cash,
securities, property or other assets in connection
with such Non-Stock Fundamental Change or Common
Stock Fundamental Change, or, if there is no such
date, as of the date upon which the holders of the
Common Stock shall have the right to receive such
cash, securities, property or other assets.
"Common Stock Fundamental Change" shall mean
any Fundamental Change in which more than 50% by
value (as determined in good faith by the Board of
Directors of the Corporation) of the consideration
received by the holders of Common Stock pursuant to
such transaction consists of common stock that, for
the 20 consecutive trading days
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immediately prior to such Fundamental Change, has
been admitted for listing or admitted for listing
subject to notice of issuance on a national
securities exchange or quoted on the Nasdaq National
Market (or any successor system); provided, however,
that a Fundamental Change shall not be a Common Stock
Fundamental Change unless either (i) the Corporation
continues to exist after the occurrence of such
Fundamental Change and the outstanding shares of
Series A Convertible Preferred Stock continue to
exist as outstanding shares of Series A Convertible
Preferred Stock or (ii) not later than the occurrence
of such Fundamental Change, the outstanding shares of
Series A Convertible Preferred Stock are converted
into or exchanged for shares of convertible preferred
stock of a corporation succeeding directly or
indirectly to the business of the Corporation, which
convertible preferred stock has powers, preferences
and relative, participating, optional and other
rights, and qualifications, limitations and
restrictions the same as those of the Series A
Convertible Preferred Stock.
"Fundamental Change" shall mean the
occurrence of any transaction or event or series of
transactions or events pursuant to which all or
substantially all of the Common Stock shall be
exchanged for, converted into, acquired for or
constitute solely the right to receive cash,
securities, property or other assets (whether by
means of an exchange offer, liquidation, tender
offer, consolidation, merger, combination,
reclassification, recapitalization or otherwise);
provided, however, in the case of any series of
transactions or events, for purposes of adjustment of
the Conversion Price, such Fundamental Change shall
be deemed to have occurred when substantially all of
the Common Stock of the Corporation shall be
exchanged for, converted into, or acquired for or
constitute solely the right to receive cash,
securities, property or other assets, but the
adjustment shall be based upon the consideration
which the holders of Common Stock received in such
transaction or event as a result of which more than
50% of the Common Stock of the Corporation shall have
been exchanged for, converted into, or acquired for
or constitute
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solely the right to receive cash, securities,
property or other assets; provided, further, that
such term does not include (x) any such transactions
or events in which the Corporation and/or any of its
subsidiaries are the issuers of all the cash,
securities, property or other assets exchanged,
acquired or otherwise issued in such transaction or
event or (y) any such transaction or event in which
the holders of Common Stock receive securities of an
issuer other than the Corporation if, immediately
following such transaction or event, such holders
hold a majority of the securities having the power to
vote normally in the election of directors of such
other issuer outstanding immediately following such
transaction or other event.
"Non-Stock Fundamental Change" shall mean
any Fundamental Change other than a Common Stock
Fundamental Change.
"Purchaser Stock Price" shall mean, with
respect to any Common Stock Fundamental Change, the
average of the daily closing prices for one share of
the common stock received in such Common Stock
Fundamental Change for the 20 consecutive trading
days immediately prior to the date fixed for the
determination of the holders of Common Stock entitled
to receive such common stock, or if there is no such
date, the date upon which the holders of the Common
Stock shall have the right to receive such common
stock.
(j) For the purposes of this paragraph (5)(vi) and
paragraph (5)(ix), the term "shares of Common Stock" shall
mean (x) the class of stock designated as the Common Stock of
the Corporation at the date hereof or (y) any other class of
stock resulting from successive changes or reclassifications
of such shares consisting solely of changes in par value, or
from no par value to par value. In the event that at any time,
as a result of an adjustment made pursuant to paragraphs
(5)(vi)(a) or (c) above, the holders of Series A Convertible
Preferred Stock shall become entitled to receive any
securities other than shares of Common Stock, thereafter the
number of such other securities so issuable upon conversion of
the shares of Series A 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
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the shares of Series A Convertible Preferred Stock contained
in this paragraph (5)(vi).
(k) Notwithstanding the foregoing, in any case in
which this paragraph (5)(vi) provides that an adjustment shall
become effective immediately after a record date for an event,
the Corporation may defer until the occurrence of such event
issuing to the holder of any share of Series A Convertible
Preferred Stock converted after such record date and before
the occurrence of such event the additional shares of Common
Stock issuable upon such conversion before giving effect to
such adjustment.
(vii) Whenever the Conversion Price is adjusted as herein
provided, the Chief Financial Officer of the Corporation shall compute
the adjusted Conversion Price in accordance with the foregoing
provisions and shall prepare a certificate setting forth such adjusted
Conversion Price and showing in reasonable detail the facts upon which
such adjustment is based, which certificate shall be conclusive
evidence of the correctness of the adjustment. A copy of such
certificate shall be filed promptly with the Conversion Agent. Promptly
after delivery of such certificate, the Corporation shall prepare a
notice of such adjustment of the Conversion Price setting forth the
adjusted Conversion Price and the date on which such adjustment becomes
effective and shall mail such notice of such adjustment of the
Conversion Price to the holder of each share of Series A Convertible
Preferred Stock at his last address as shown on the stock books of the
Corporation.
(viii) The Corporation will pay any and all documentary, stamp
or similar issue or transfer taxes payable in respect of the issue or
delivery of shares of Common Stock on the conversion of shares of
Series A Convertible Preferred Stock pursuant to this paragraph (5);
provided, however, that the Corporation shall not be required to pay
any tax which may be payable in respect of any registration of transfer
involved in the issue or delivery of shares of Common Stock in a name
other than that of the registered holder of Series A Convertible
Preferred Stock converted or to be converted, and no such issue or
delivery shall be made unless and until the person requesting such
issue 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.
(ix) (a) The Corporation shall at all times
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reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its issued
Common Stock held in its treasury, or both, for the purpose of
effecting the conversion of the Series A Convertible Preferred Stock,
the full number of shares of Common Stock then deliverable upon the
conversion of all outstanding shares of the Series A Convertible
Preferred Stock.
(b) Before taking any action which would cause an adjustment
reducing the Conversion Price below the then par value (if any) of the
Common Stock issuable upon conversion of the Series A Convertible
Preferred Stock, the Corporation will 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 nonassessable
shares of such Common Stock at such adjusted Conversion Price.
(6) Voting Rights. (i) The holders of record of shares of
Series A Convertible Preferred Stock shall not be entitled to any
voting rights except as required by law.
(ii) (a) The creation, authorization or issuance of any shares
of any Junior Securities, Parity Securities or Senior Securities, (b)
the creation of any indebtedness of any kind of the Corporation, or (c)
the increase or decrease in the amount of authorized capital stock of
any class, including Preferred Stock, shall not require the consent of
the holders of Series A Convertible Preferred Stock and shall not be
deemed to affect materially and adversely the rights, preferences,
privileges or voting rights of shares of Series A Convertible Preferred
Stock.
(7) Limitations. Except as may otherwise be required by law,
the shares of Series A Convertible Preferred Stock shall not have any
powers, preferences or relative, participating, optional or other
special rights other than those specifically set forth in this
resolution (as such resolution may be amended from time to time) or
otherwise in the Restated Charter of the Corporation.
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B. Common Stock
Each share shall be entitled to one vote. No holder
of any Common Stock of the corporation, now or hereafter
authorized, shall have any right, as such holder, to purchase,
subscribe for or otherwise acquire any shares of stock of the
corporation, or any securities or obligations convertible
into, or exchangeable for, or any right, warrant or option to
purchase, any shares of any class which the corporation may at
any time hereafter issue or sell, whether now or hereafter
authorized, but any and all such stock, securities,
obligations, rights, warrants or options may be issued and
disposed of by the Board of Directors to such persons, firms
or corporations, and for such lawful consideration and on such
terms as the Board of Directors in its discretion may, from
time to time, determine, without first offering the same to
the shareholders of the corporation.
6. The shareholders of the corporation shall not have
preemptive rights.
7. The Board of Directors shall consist of not less than nine
and not more than thirteen directors, each of whom shall hold office until the
annual meeting next following his election to the Board of Directors and until
his successor shall be elected and shall qualify, subject, however, to prior
death, resignation, retirement, disqualification or removal from office.
Any director may be removed from office with or without cause
by the affirmative vote of the holders of a majority of the voting power of the
shares entitled to vote for the election of directors, considered for this
purpose as one class.
Notwithstanding the foregoing, whenever the holders of any one
or more classes or series of preferred stock issued by the corporation shall
have the right, voting separately by class or series, to elect directors at any
annual or special meeting of shareholders, the election, term of office, filling
of vacancies and other features of such directorships shall be governed by the
terms of this Charter applicable thereto, and such directors so elected shall
not be divided into class pursuant to this Article 7 unless expressly provided
by such terms. In the event of a vacancy among the directors so elected by the
holders of preferred stock, the remaining preferred directors may fill the
vacancy for the unexpired term.
The Board of Directors, acting by majority vote, may amend or
repeal the By-Laws of the Corporation; provided that no such amendment or repeal
shall be effective unless it is approved and adopted in accordance with that
certain Stockholders' Agreement, dated as of May 27, 1998, by and among the
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Corporation, Regal Equity Partners, L.P., KKR 1996 Fund, L.P. and KKR Partners
II, L.P., as such agreement may be amended, supplemented or otherwise modified
from time to time and so long as such agreement shall be in effect.
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8. To the fullest extent permitted by the Tennessee Business
Corporation Act as in effect on the date hereof and as hereafter amended from
time to time, a director of the corporation shall not be liable to the
corporation or its shareholders for monetary damages for breach of fiduciary
duty as a director. If the Tennessee Business Corporation Act or any successor
statute is amended after adoption of this provision to authorize corporate
action further eliminating or limiting the personal liability of directors, then
the liability of a director of the corporation shall be eliminated or limited to
the fullest extent permitted by the Tennessee Business Corporation Act, as so
amended from time to time. Any repeal or modification of this Paragraph 8 by the
shareholders of the corporation shall not adversely affect any right or
protection of a director of the corporation existing at the time of such repeal
or modification or with respect to events occurring prior to such time.
Dated: 5/27/98
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REGAL CINEMAS, INC.
By: /s/ MICHAEL L. CAMPBELL
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Michael L. Campbell
Chairman, Chief Executive Officer
and President