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EXHIBIT 3.1
CERTIFICATE OF AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ON COMMAND CORPORATION
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Adopted in accordance with the provisions of Section 242 and
Section 245 of the General Corporation Law of the State of Delaware
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We, the Vice President and Secretary of On Command Corporation, a
corporation existing under the laws of the State of Delaware, do hereby certify
as follows:
FIRST: That said corporation was incorporated on July 25, 1996, under
the name of Ascent Acquisition Corporation.
SECOND: That the Certificate of Incorporation of said corporation has
been amended and restated in its entirety as follows:
ARTICLE I
The name of the corporation is On Command Corporation.
ARTICLE II
The address of the corporation's registered office in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, in the City of
Wilmington, County of New Castle. The name of the corporation's registered agent
at such address is the Corporation Trust Company.
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ARTICLE III
The purpose of the corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
ARTICLE IV
The total number of shares of stock which the corporation shall have
authority to issue is 60,000,000, divided into 50,000,000 shares of common
stock, par value $0.01 per share (the "Common Stock"), and 10,000,000 shares of
preferred stock, par value $0.01 per share (the "Preferred Stock").
The Board of Directors of the corporation is authorized, subject to
limitations prescribed by law and the provisions of this Article IV, to provide
for the issuance of the shares of Preferred Stock in series, and by filing a
certificate pursuant to the applicable law of the State of Delaware, to
establish from time to time the number of shares to be included in each such
series, and to fix the designation, powers, preferences and rights of the shares
of each such series and the qualifications, limitations or restrictions thereof.
The authority of the Board of Directors of the corporation with respect
to each series shall include, but not be limited to, determination of the
following:
(a) The number of shares constituting that series and the distinctive
designation of that series;
(b) The dividend rate on the shares of that series, whether dividends
shall be cumulative, and, if so, from which date or dates, and the relative
rights of priority, if any, of payment of dividends on shares of that series;
(c) Whether that series shall have voting rights, in addition to the
voting rights provided by law, and, if so, the terms of such voting rights,
provided that no series of Preferred Stock shall have a class vote unless the
same has been approved in writing by the holders of at least a majority of the
outstanding shares of capital stock of the corporation entitled to vote
generally in the election of directors;
(d) Whether that series shall have conversion privileges, and, if so,
the terms and conditions of such conversion, including provision for adjustment
of the conversion rate in such events as the Board of Directors shall determine;
(e) Whether or not 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, and the amount per share payable
in case of redemption, which amount may vary under different conditions and at
different redemption dates;
(f) Whether that series shall have a sinking fund for the redemption or
purchase of shares of that series, and, if so, the terms and amount of such
sinking fund;
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(g) The rights of the shares of that series in the event of voluntary
or involuntary liquidation, dissolution or winding up of the corporation, and
the relative rights of priority, if any, of payment of shares of that series;
and
(h) Any other relative rights, preferences and limitations of that
series.
Dividends on outstanding shares of Preferred Stock shall be paid or
declared and set apart for payment before any dividends shall be paid or
declared and set apart for payment on the Common Stock with respect to the same
dividend period.
If upon any voluntary or involuntary liquidation, dissolution or
winding up of the corporation, the assets available for distribution to holders
of shares of Preferred Stock of all series shall be insufficient to pay such
holders the full preferential amount to which they are entitled, then such
assets shall be distributed ratably among the shares of all series of Preferred
Stock in accordance with the respective preferential amounts (including unpaid
cumulative dividends, if any) payable with respect thereto.
ARTICLE V
(a) Subject to the voting rights provided by law or granted to any
series of Preferred Stock, all rights to vote and all voting power shall be
exclusively vested in the Common Stock. In the event that the stockholders of
the corporation elect to take any action by written consent in lieu of any
annual or special meeting of such stockholders as authorized by Section 228 of
the General Corporation Law of the State of Delaware, or any successor
provision, such action shall not become effective until 20 days after the
corporation or any stockholder of the corporation provides the notice required
by Section 228(d) of the General Corporation Law of the State of Delaware, or
any successor provision, unless all of the stockholders of the corporation have
consented to the taking of such action.
(b) Until the Termination Date (as defined below), each holder of
shares of Common Stock shall be entitled at all elections of directors to as
many votes as shall equal the number of votes which (except for this provision
as to cumulative voting) he would be entitled to cast for the election of
directors with respect to his shares of Common Stock multiplied by the number of
directors to be elected, and such holder may cast all of such votes for a single
director or may distribute them among the number to be voted for, or for any two
or more of them as he may see fit, and to one vote for each share upon all other
matters. Upon the occurrence of the Termination Date, the holders of the Common
Stock shall cease to be entitled to cumulative voting rights with respect
thereto and, from and after the Termination Date, the directors shall be elected
by straight voting.
As used herein, the term "Termination Date" means the first date on
which any "person" or related group (within the meaning of Rule 13(d)(3) or Rule
14(d)(2) of the General Rules and Regulations under the Securities Exchange Act
of 1934 as in effect on the date of the adoption of this Article, including any
"group" acting for the purpose of acquiring or disposing of securities within
the meaning of Rule 13d-5(b)(1) of the General Rules and Regulations under the
Securities Exchange Act of 1934 as in effect on the date of adoption of this
Article), other than
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the Excluded Persons (as defined below), holds, directly or indirectly, more
than 15% of the outstanding shares of capital stock of the corporation entitled
to vote generally in the election of directors (considered for this purpose as
one class), and, for the purpose of this provision, all shares of Common Stock
issuable upon the exercise or conversion of all currently exercisable or
convertible warrants, options or other securities held by such person or related
group shall be deemed to be outstanding and held by such person or related
group. As used herein, "Excluded Persons" means (a) each person who held common
stock of On Command Video Corporation ("OCV") immediately prior to the merger of
OCV with On Command Video Corporation and (b) any other person who, individually
or collectively with its affiliates, receives upon original issuance thereof
shares of Common Stock and Common Stock Purchase Warrants of the corporation
that represent more than 5% of the Applicable Securities (as defined below) to
be issued to such person or related group pursuant to the Purchase Agreement (as
defined below). As used herein, the term "Applicable Securities" means all
shares of Common Stock (including shares of Common Stock purchasable upon
exercise of Common Stock Purchase Warrants) to be issued and outstanding
immediately upon consummation of the transactions contemplated by that certain
Acquisition Agreement, dated August 13, 1996, among the corporation, Ascent
Entertainment Group, Inc., SpectraVision, Inc., the Official Creditors'
Committee for SpectraVision, Inc., Spectradyne, Inc. and the other domestic
subsidiaries of SpectraVision, Inc., after giving effect to the post-closing
adjustment, if any, contemplated by Section 5.2 of such Acquisition Agreement.
ARTICLE VI
Unless and except to the extent that the By-Laws of the corporation
shall so require, the election of directors of the corporation need not be by
written ballot.
ARTICLE VII
(a) The number of directors constituting the entire Board of Directors
of the corporation shall be fixed by, or in the manner provided in, the
corporation's By-Laws from time to time; provided, however, that until the
Termination Date, the number of directors shall not be less than seven.
(b) From and after the date of issuance of the Applicable Securities,
the Board of Directors will be elected at the annual meeting of stockholders of
On Command Corporation and will serve a one-year term until the next annual
meeting of stockholders. Director nominees receiving a plurality of the votes
cast by the holders of outstanding shares of On Command Corporation represented
at the annual meeting of stockholders, in person or by proxy, will be elected as
directors of On Command Corporation. Any vacancies in the Board of Directors for
any reason, and any directorships resulting from any increase in the number of
directors, may be filled by the Board of Directors, acting by a majority of the
directors then in office, although less than a quorum, and any directors so
chosen shall hold office until the next election at which such directors
successors shall have been elected and qualified. Notwithstanding the foregoing,
and except as otherwise required by law, whenever the holders of any one or more
series of Preferred Stock shall have the right, voting separately as a class, to
elect one or more directors of the
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corporation, the terms of the director or directors elected by such holders
shall expire at the next succeeding annual meeting of stockholders. Subject to
the foregoing, at each annual meeting of stockholders the successors to the
directors whose term shall then expire shall be elected to hold office for a
term expiring at the next succeeding annual meeting.
(c) Notwithstanding any other provisions of this Certificate of
Incorporation or the By-Laws of the corporation, any director or the entire
Board of Directors of the corporation may be removed at any time, with or
without cause, by the holders of a majority of the outstanding shares of capital
stock of the corporation entitled to vote generally in the election of directors
(considered for this purpose as one class), except that, prior to the
Termination Date, if less than the entire Board of Directors is to be removed,
no director may be removed without cause if the votes cast against his removal
would be sufficient to elect him if then cumulatively voted at an election of
the entire Board of Directors. Notwithstanding the foregoing, and except as
otherwise required by law, whenever the holders of any one or more series of
Preferred Stock shall have the right, voting separately as a class, to elect one
or more directors of the corporation, the provisions of section (c) of this
Article shall not apply with respect to the director or directors elected by
such holders of Preferred Stock.
ARTICLE VIII
In furtherance and not in limitation of the powers conferred by the
laws of the State of Delaware, a majority of the entire Board of Directors of
the corporation is expressly authorized to make, alter and repeal from time to
time the By-Laws of the corporation, subject to the power of the stockholders of
the corporation to alter or repeal any by-law made by the Board of Directors of
the corporation.
ARTICLE IX
A director of the corporation shall not be liable to the corporation or
its stockholders for monetary damages for breach of fiduciary duty as a
director, except to the extent such exemption from liability or limitation
thereof is not permitted under the General Corporation Law of the State of
Delaware as the same exists or may hereafter be amended. Any amendment,
modification or repeal of the foregoing sentence shall not adversely affect any
right or protection of a director of the corporation hereunder in respect of any
act or omission occurring prior to the time of such amendment, modification or
repeal.
ARTICLE X
The corporation reserves the right at any time, and from time to time,
to amend, alter, change or repeal any provision contained in this Certificate of
Incorporation, and other provisions authorized by the laws of the State of
Delaware at the time in force may be added or inserted, in the manner now or
hereafter prescribed by law; provided, however, that any amendment, alteration,
change or repeal of the provisions of clause (a) of Article V, clause (a) of
article VII and this Article X shall require the affirmative vote of the holders
of at least 80% of the outstanding shares of capital stock of the corporation
entitled to vote thereon.
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All rights, preferences and privileges of whatsoever nature conferred
upon stockholders, directors or any other persons whomsoever by and pursuant to
this Certificate of Incorporation in its present form or as hereafter amended
are granted subject to the rights reserved in this article.
THIRD: That such amended and restated Certificate of Incorporation has
been duly adopted in accordance with Section 242 and Section 245 of the General
Corporation Law of the State of Delaware by the written consent of the
stockholder of the corporation in accordance with Section 228 of the General
Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, we have signed this certificate this 13th day of
August, 1996.
/s/ James A. Cronin, III
-------------------------------
James A. Cronin, III
Vice President
ATTEST:
/s/ Arthur M. Aaron
- ----------------------
Arthur M. Aaron
Secretary
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CERTIFICATE OF AMENDMENT
TO
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ON COMMAND CORPORATION
On Command Corporation, a corporation organized and existing
under the laws of the State of Delaware, hereby certifies as follows:
(1) The Board of Directors of the Corporation duly adopted,
at a meeting of the Board of Directors in accordance with Section 141 of
the Delaware General Corporation Law, the following resolutions:
RESOLVED, that the first paragraph of
ARTICLE IV of the Corporation's Amended and Restated
Certificate of Incorporation shall be amended to read in its
entirety as follows:
"The total number of shares of stock which the
corporation shall have authority to issue is 160
million, divided into 150 million shares of common
stock, par value $.01 per share (the "Common Stock"),
and 10 million shares of preferred stock, par value
$0.01 per share (the "Preferred Stock")."
and further,
RESOLVED, that the Board of Directors has
determined that amending the Corporation's Amended and
Restated Certificate of Incorporation in accordance with the
foregoing resolution is advisable and in the best interests of
the Corporation, and that the proper officers of the
Corporation are hereby authorized and directed to submit the
foregoing amendment to the stockholders of the Corporation for
their approval at the next annual meeting of the stockholders;
and further,
RESOLVED, that upon adoption of such
amendment by the Corporation's stockholders, the proper
officers of the Corporation be, and each of them hereby is,
authorized and empowered for and on behalf of the Corporation
to execute a Certificate of Amendment setting forth the
foregoing resolutions and to cause it to be acknowledged,
filed and recorded in accordance with the Delaware General
Corporate Law;
and further,
RESOLVED, that the Certificate of Amendment
is to take effect upon the filing thereof with the Secretary
of State of the State of Delaware.
(2) Thereafter, pursuant to resolution of the Corporation's
Board of Directors, this Certificate of Amendment to the Certificate of
Incorporation of the Corporation was duly submitted to the stockholders of
the Corporation at the Corporation's annual meeting of stockholders in
accordance with Sections 222 and 242 of the Delaware General Corporation
Law and was duly approved and adopted by the stockholders of the
Corporation in accordance with Sections 211 and 242 of the Delaware General
Corporation Law.
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This Certificate of Amendment has been duly adopted by the
Board of Directors and stockholders of this Corporation in accordance with
Section 242 of the General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused this
Certificate of Amendment to be signed by the undersigned this 6th day of
October, 2000.
On Command Corporation.
/s/ Jerome Kern
-----------------------------------
Jerome Kern
Chief Executive Officer
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ON COMMAND CORPORATION
CERTIFICATE OF DESIGNATIONS
---------------
SETTING FORTH A COPY OF A RESOLUTION
CREATING AND AUTHORIZING THE ISSUANCE
OF A SERIES OF PREFERRED STOCK DESIGNATED AS
"CONVERTIBLE PARTICIPATING PREFERRED STOCK,
SERIES A" ADOPTED BY THE BOARD OF DIRECTORS
OF ON COMMAND CORPORATION
---------------
The undersigned, a Vice President of ON COMMAND
CORPORATION, a Delaware corporation (this "Corporation"), HEREBY CERTIFIES that
the Board of Directors of this Corporation on July 25, 2000, duly adopted the
following resolutions creating a new series of this Corporation's Preferred
Stock:
"BE IT RESOLVED, that pursuant to authority expressly
granted by the provisions of Article IV of the Certificate of Incorporation of
this Corporation, the Board of Directors hereby creates and authorizes the
issuance of a new series of this Corporation's preferred stock, par value $.01
per share ("Preferred Stock"), and hereby fixes the powers, designations,
dividend rights, voting powers, rights on liquidation, conversion rights,
redemption rights and other preferences and relative, participating, optional or
other special rights and the qualifications, limitations or restrictions of the
shares of such series (in addition to the powers, designations, preferences and
relative, participating, optional or other special rights and the
qualifications, limitations or restrictions thereof set forth in the Certificate
of Incorporation that are applicable to each class and series of Preferred
Stock), as follows:
1. Designation and Number. The designation of the series
of Preferred Stock, par value $.01 per share, of this Corporation authorized
hereby is "Convertible Participating Preferred Stock, Series A" (the "Series A
Preferred Stock"). The number of shares constituting the Series A Preferred
Stock shall be 13,500.
2. Certain Definitions. Unless the context otherwise
requires, the terms defined in this paragraph 2 shall, for all purposes of this
Certificate of Designations, have the meanings herein specified:
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Series A Preferred Stock
"Note": The promissory note made by Jerome H. Kern to
this Corporation dated August 10, 2000 in the principal amount of $21,080,250,
or any substitute therefor or amendment thereof.
"Board of Directors": The Board of Directors of this
Corporation and, to the extent permitted by law, unless the context indicates
otherwise, any committee thereof authorized with respect to any particular
matter to exercise the power of the Board of Directors of this Corporation with
respect to such matter.
"Business Day": Any day other than a Saturday, Sunday or
a day on which banking institutions in Denver, Colorado are not required to be
open.
"Capital Stock": Any and all shares, interests,
participations or other equivalents (however designated) of corporate stock of
this Corporation.
"Common Stock": The Common Stock, $.01 par value per
share, of this Corporation, and all series thereof hereafter created.
"Control": The direct or indirect power to direct, or
cause the directions of, the management and policies of any person, whether,
through the ownership of voting securities, by contract, by membership or
involvement on the board of directors, management committee or other management
structure or otherwise.
"Conversion Date": Of a share of Series A Preferred
Stock, (i) in the case of a conversion at the option of the holder pursuant to
paragraph 5(a)(i), the date on which the requirements for conversion of such
Share set forth in paragraph 5(j) have been satisfied by the holder thereof and
(ii) in the case of an automatic conversion pursuant to paragraph 5(a)(ii), the
close of business on the day of the occurrence of the event requiring such
automatic conversion.
"Conversion Price": As defined in paragraph 5(b).
"Conversion Rate": The kind and amount of securities,
cash or other assets that as of any date are issuable or deliverable upon
conversion of a share of Series A Preferred Stock. The Conversion Rate of a
Share of Series A Preferred Stock shall initially be as set forth in paragraph
5(b), subject to adjustment as set forth in paragraph 5 of this Certificate of
Designations. In the event that pursuant to paragraph 5 the Series A Preferred
Stock becomes convertible into more than one class or series of Capital Stock of
this Corporation, the term Conversion Rate, when used with respect to any such
class or series, shall mean the number or fraction of shares or other units of
such Capital Stock that as of any date would be issued upon conversion of a
share of Series A Preferred Stock.
"Convertible Securities": Securities that are
convertible into or exercisable or exchangeable for Common Stock at the option
of the holder thereof, or which otherwise entitle the holder thereof to
subscribe for, purchase or otherwise acquire Common Stock.
"Corporation": On Command Corporation.
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Series A Preferred Stock
"Exchange Act": The Securities Exchange Act of 1934, as
amended.
"Exchange Offer": An issuer tender offer (within the
meaning of Rule 13e-4(a)(2) of the rules and regulations promulgated by the
Securities and Exchange Commission under the Exchange Act, as such Rule is in
effect on the date hereof), including, without limitation, one that is effected
through the distribution of rights or warrants, made to holders of Common Stock
(or to holders of other stock of this Corporation receivable by a holder of
Shares upon conversion thereof ( or upon conversion of securities receivable by
a holder of Shares upon conversion of such Shares)), to issue stock of this
Corporation or of a Subsidiary of this Corporation and/or other property to a
tendering stockholder in exchange for shares of Common Stock (or such other
stock) validly tendered pursuant to such issuer tender offer.
"Exchange Preferred Stock": A series of convertible
preferred stock of this Corporation, having terms, conditions, designations,
dividend rights, voting powers, rights on liquidation and other preferences and
relative, participating, optional or other special rights, and qualifications,
limitations or restrictions thereof that are identical, or as nearly so as is
practicable in the judgment of the Board of Directors, to those of the Series A
Preferred Stock for which such Exchange Preferred Stock is exchanged, except
that (i) the liquidation preference will be determined as provided in paragraph
5(e) or 5(f), as applicable, (ii) the running of any time periods pursuant to
the terms of the Series A Preferred Stock shall be tacked to the corresponding
time periods in the Exchange Preferred Stock and (iii) the Exchange Preferred
Stock will not be convertible into, and the holders will have no conversion
rights thereunder with respect to, (x) in the case of a redemption of Redeemable
Capital Stock, the Redeemable Capital Stock redeemed, or the Redemption
Securities issued, in the Redemption Event, and (y) in the case of a Spin Off,
the Spin Off Securities.
"Exchange Securities": Stock of this Corporation or of a
Subsidiary of this Corporation that is issued in exchange for shares of Common
Stock (or other stock of this Corporation receivable by a holder of Shares upon
conversion thereof (or upon conversion of securities receivable by a holder of
Shares upon conversion of such Shares)) pursuant to an Exchange Offer.
"HSR Act": As defined in paragraph 5(a).
"Issue Date": The first date on which any shares of the
Series A Preferred Stock are issued.
"Junior Securities": All shares of Common Stock, and any
class or series of Capital Stock of this Corporation, whether now existing or
hereafter created, to the extent that it ranks junior to the Series A Preferred
Stock as to dividend rights or rights on liquidation. A class or series of
Junior Stock shall rank junior to the Series A Preferred Stock as to dividend
rights or rights on liquidation if the holders of shares of Series A Preferred
Stock shall be entitled to dividend payments or payments of amounts
distributable upon liquidation, dissolution or winding up of the affairs of this
Corporation, as the case may be, in preference or priority to the holders of
shares of such class or series.
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Series A Preferred Stock
"Liquidation Preference": $.01 per share of Series A
Preferred Stock.
"Mirror Preferred Stock": Convertible preferred stock
issued by (a) in the case of a redemption of Redeemable Capital Stock, the
issuer of the applicable Redemption Securities, (b) in the case of a Spin Off,
the issuer of the applicable Spin Off Securities, and (c) in the case of an
Exchange Offer, the issuer of the applicable Exchange Securities, and having
terms, conditions, designations, dividend rights, voting powers, rights on
liquidation and other preferences and relative, participating, optional or other
special rights, and qualifications, limitations or restrictions thereof that are
identical, or as nearly so as practicable in the judgment of the Board of
Directors, to those of the Series A Preferred Stock for which such Mirror
Preferred Stock is exchanged, except that (i) the liquidation preference will be
determined as provided in paragraph 5(e), 5(f) or 6, as applicable, (ii) the
running of any time periods pursuant to the terms of the Series A Preferred
Stock shall be tacked to the corresponding time periods in the Mirror Preferred
Stock, and (iii) the Mirror Preferred Stock shall be convertible into the kind
and amount of Redemption Securities, Spin Off Securities or Exchange Securities,
as applicable, and other securities and property that the holder of a share of
Series A Preferred Stock in respect of which such Mirror Preferred Stock is
issued pursuant to the terms hereof would have received (x) in the case of the
redemption of Redeemable Capital Stock, upon such redemption had such shares of
Series A Preferred Stock been converted immediately prior to the effective date
of the Redemption Event, (y) in the case of a Spin Off, in such Spin Off had
such share of Series A Preferred Stock been converted immediately prior to the
record date for such Spin Off and (z) in the case of an Exchange Offer, upon
consummation thereof had such share of Series A Preferred Stock that such holder
elects to tender pursuant to Section 6 been converted and the shares of Common
Stock received upon such conversion been tendered in full pursuant to such
Exchange Offer prior to the expiration thereof and the same percentage of such
tendered shares had been accepted for exchange as the percentage of validly
tendered shares of Common Stock were accepted for exchange pursuant to such
Exchange Offer, as the case may be.
"Offeror": As defined in paragraph 6(a).
"Parity Securities": Any class or series of stock of
this Corporation, whether now existing or hereafter created, ranking on a parity
basis with the Series A Preferred Stock as to dividend rights or rights on
liquidation. Stock of any class or series shall rank on a parity basis as to
dividend rights or rights on liquidation with the Series A Preferred Stock,
whether or not the dividend rates, dividend payment dates or liquidation prices
per share are different from those of the Series A Preferred Stock, if the
holders of shares of such class or series shall be entitled to dividend payments
or payments of amounts distributable upon liquidation, dissolution or winding up
of the affairs of this Corporation, as the case may be, in proportion to their
respective accumulated and accrued and unpaid dividends or liquidation prices,
respectively, without preference or priority, one over the other, as between the
holders of shares of such class or series and the holders of Series A Preferred
Stock. No class or series of Capital Stock that ranks junior to the Series A
Preferred Stock as to rights on liquidation shall rank or be deemed to rank on a
parity basis with the Series A Preferred Stock as to dividend rights unless the
instrument creating or evidencing such class or series of capital stock
otherwise expressly provides.
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Series A Preferred Stock
"Participating Dividends": As defined in paragraph 3(a).
"Permitted Holder": Jerome H. Kern, the executor or
personal representative of the estate of Jerome H. Kern and any corporation,
partnership or limited liability company (x) of which at least 50% of the
outstanding equity interests are owned of record and beneficially by Jerome H.
Kern and (y) which is Controlled by Jerome H. Kern.
"person": A natural person, corporation, limited
liability company, partnership or other legal entity.
"Preferred Stock": The preferred stock, par value $.01
per share, of the Corporation.
"Redeemable Capital Stock": A class or series of Capital
Stock of this Corporation that provides by its terms a right in favor of this
Corporation to call, redeem, exchange or otherwise acquire all of the
outstanding shares or units of such class or series.
"Redemption Securities": With respect to the redemption
of any Redeemable Capital Stock, stock of a Subsidiary of this Corporation that
is distributed by this Corporation in payment, in whole or in part, of the
redemption price of such Redeemable Capital Stock.
"Senior Securities": Any class or series of stock of
this Corporation, whether now existing or hereafter created, ranking senior to
the Series A Preferred Stock as to dividend rights or rights on liquidation.
Stock of any class or series shall rank senior to the Series A Preferred Stock
as to dividend rights or rights on liquidation if the holders of shares of such
class or series shall be entitled to dividend payments or payments of amounts
distributable upon dissolution, liquidation or winding up of the affairs of this
Corporation, as the case may be, in preference or priority to the holders of
shares of Series A Preferred Stock. No class or series of Capital Stock that
ranks on a parity basis with or junior to the Series A Preferred Stock as to
rights on liquidation shall rank or be deemed to rank prior to the Series A
Preferred Stock as to dividend rights, notwithstanding that the dividend rate or
dividend payment dates thereof are different from those of the Series A
Preferred Stock, unless the instrument creating or evidencing such class or
series of capital stock otherwise expressly provides.
"Series A Preferred Stock": As defined in paragraph 1.
"Share": A share of Series A Preferred Stock.
"Spin Off": The distribution of stock of a Subsidiary of
this Corporation as a dividend to all holders of Common Stock (or to holders of
other stock of this Corporation receivable by a holder of Shares upon conversion
thereof (or upon conversion of securities receivable by a holder of Shares upon
conversion of such Shares)).
"Spin Off Securities": Stock of a Subsidiary of this
Corporation that is distributed to holders of Common Stock (or to holders of
other stock of this Corporation receivable by a holder of Shares upon conversion
thereof (or upon conversion of securities receivable by a holder of Shares upon
conversion of such Shares)) in a Spin Off.
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Series A Preferred Stock
"Stated Value": Of a Share of the Series A Preferred
Stock, $1,562.50.
"Subsidiary": With respect to any person, any
corporation, limited liability company, partnership or other legal entity more
than 50% of whose outstanding voting securities or membership, partnership or
other ownership interests, as the case may be, are directly or indirectly owned
by such person.
3. Dividends.
(a) Subject to the prior preferences and other
rights of any Senior Stock and the provisions of paragraphs 5 and 6 hereof, the
holders of Series A Preferred Stock shall be entitled to receive dividends per
Share in cash, securities, property or other assets of the Corporation (other
than a dividend or distribution for which an adjustment is required pursuant to
paragraph 5(c)) only when, as and if a dividend or distribution is declared and
paid upon the outstanding shares of Common Stock. The type and amount of the
dividends or distributions to which the holder of a Share is entitled (the
"Participating Dividend") shall be determined as follows:
(i) Cash Dividends. In case this Corporation, on
or after the Issue Date, declares and pays a dividend in cash on the
Common Stock (or other securities into which the Series A Preferred
Stock is then convertible), a Participating Dividend will be declared
and paid to the holders of the Series A Preferred Stock in an amount
equal to the product of (x) the amount of the cash dividend declared
and to be paid on a single share of Common Stock (or any other
security into which the Series A Preferred Stock is then convertible)
and (y) the number of shares of Common Stock (or other security) into
which a share of Series A Preferred Stock may be converted as of the
date such dividend is paid.
(ii) Other Distributions. In case this
Corporation, on or after the Issue Date, shall distribute to all
holders of shares of Common Stock (or other securities into which the
Series A Preferred Stock is then convertible) any evidences of its
indebtedness or assets or rights or warrants to purchase shares of
Common Stock (or Convertible Securities) (excluding dividends or
distributions referred to in paragraph 5(c), distributions of Spin Off
Securities referred to in paragraph 5(f) and distributions of rights
or warrants exercisable for Exchange Securities (which shall be
governed by paragraph 6)), a Participating Dividend will be declared
and paid to the holders of the Series A Preferred Stock in an amount
equal to the product of (x) the type and amount of such security,
property or other asset which is to be distributed in respect of a
single share of Common Stock (or other security) into which a share of
Series A Preferred Stock is then convertible) and (y) the number of
shares of Common Stock (or other security) into which a share of
Series A Preferred Stock is convertible immediately prior to the
opening of business on (A) the record date for the determination of
stockholders entitled to receive the distribution or (B) in the case
of a reclassification, the effective date of such reclassification.
6
15
Series A Preferred Stock
(b) The Participating Dividends shall be the
only dividends or distribution payable to holders of Series A
Preferred Stock. Participating Dividends shall be payable in
preference to, but simultaneously with, any dividend payments to
the holders of any Junior Stock. Participating Dividends shall be
payable to holders of record of shares of Series A Preferred
Stock as of the record date for the determination of holders of
Common Stock entitled to receive such dividend or the payment
date established by the Corporation for the payment of such
dividend or the making of such distribution to holders of Common
Stock, if no such record date is established.
(c) All dividends paid with respect to the
shares of Series A Preferred Stock pursuant to this paragraph 3
shall be paid pro rata to all the holders of shares of Series A
Preferred Stock outstanding on the applicable record date.
4. Distributions Upon Liquidation, Dissolution or
Winding Up.
Subject to the prior payment in full of the preferential
amounts to which any Senior Stock is entitled, in the event of any liquidation,
dissolution or winding up of this Corporation, whether voluntary or involuntary,
the holders of Series A Preferred Stock shall be entitled to receive from the
assets of the Corporation available for distribution to stockholders, before any
payment or distribution shall be made to the holders of any Junior Stock, an
amount in cash or property at its fair market value, as determined by the Board
of Directors in good faith, or a combination thereof, per share, equal to the
Liquidation Preference of a share of Series A Preferred Stock as of the date of
payment or distribution, which payment or distribution shall be made pari passu
with any such payment or distribution made to the holders of any Parity
Securities ranking on a parity basis with the Series A Preferred Stock with
respect to distributions upon liquidation, dissolution or winding up of the
Corporation. Following the payment of all amounts owing to holders of each class
or series of Capital Stock of this Corporation having a preference or priority
over the Common Stock (or other stock into which the Series A Preferred Stock is
then convertible) as to distributions upon the liquidation, dissolution or
winding up of this Corporation, then the holders of the Series A Preferred Stock
shall be entitled to participate, with the holders of the Common Stock (or other
stock into which the Series A Preferred Stock is then convertible), pro rata,
based upon the number of shares of Common Stock (or other securities) into which
the shares of Series A Preferred Stock are then convertible, as to any amounts
remaining for distribution to the holders of Common Stock (or other securities)
upon the liquidation, dissolution or winding up of this Corporation. If, upon
distribution of this Corporation's assets in liquidation, dissolution or winding
up, the assets of this Corporation to be distributed among the holders of the
Series A Preferred Stock and to all holders of any Parity Stock ranking on a
parity basis with the Series A Preferred Stock with respect to distributions
upon liquidation, dissolution or winding up shall be insufficient to permit
payment in full to such holders of the respective preferential amounts to which
they are entitled, then the entire assets of this Corporation to be distributed
to holders of the Series A Preferred Stock and such Parity Securities shall be
distributed pro rata to such holders based upon the aggregate of the full
preferential amounts to which the shares of Series A Preferred Stock and such
Parity Securities would otherwise respectively be entitled. Neither the
consolidation or merger of this Corporation with or into any other corporation
or corporations nor the sale, transfer or lease of all or substantially all of
the assets of this Corporation shall itself be deemed
7
16
Series A Preferred Stock
to be a liquidation, dissolution or winding up of this Corporation within the
meaning of this paragraph 4. Notice of the liquidation, dissolution or winding
up of this Corporation shall be given, not less than 20 days prior to the date
on which such liquidation, dissolution or winding up is expected to take place
or become effective, to the holders of record of the shares of Series A
Preferred Stock.
5. Conversion.
(a) (i) The Series A Preferred Stock may be
converted at any time or from time to time, at the option of the holder
thereof, in such manner and upon such terms and conditions as hereinafter
provided in this paragraph 5 into fully paid and non-assessable full shares
of Common Stock.
(i) Each share of Series A Preferred Stock that
is outstanding at the date upon which all obligations under the Note have
been satisfied will, subject to the receipt of any required governmental
consents or approvals and the expiration or termination of the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), automatically be converted without the taking of
any action by the holder thereof into shares of Common Stock (or other
securities) at the then applicable Conversion Rate. From and after the date
of the occurrence of the event requiring conversion pursuant to this clause
(ii), all shares of Series A Preferred Stock will be deemed to represent
only the right to receive the number of shares of Common Stock (or other
securities) issuable upon such conversion.
(b) Subject to the provisions for adjustment
hereinafter set forth in this paragraph 5, the Series A Preferred Stock may be
converted into Common Stock at the initial conversion rate of 100 fully paid and
non-assessable shares of Common Stock for one share of the Series A Preferred
Stock, which rate was determined by dividing the Stated Value of a Share of
Series A Preferred Stock by $15.625 (the "Conversion Price").
(c) In case this Corporation shall, on or after the
Issue Date, (i) pay a dividend or make a distribution on its then outstanding
shares of Common Stock in shares of Common Stock, (ii) subdivide the then
outstanding shares of Common Stock into a greater number of shares of Common
Stock, (iii) combine the then outstanding shares of Common Stock into a smaller
number of shares of Common Stock, or (iv) issue by reclassification of its then
outstanding shares of Common Stock (other than a reclassification by way of
merger or binding share exchange that is subject to paragraph 5(d)) any shares
of any other class or series of Capital Stock of this Corporation (other than
rights, warrants or options for its Capital Stock), then, subject to the
following sentence and to paragraph 5(h), the conversion privilege and the
Conversion Rate in effect immediately prior to the opening of business on the
record date for such dividend or distribution or the effective date of such
subdivision, combination or reclassification shall be adjusted so that the
holder of each share of the Series A Preferred Stock thereafter surrendered for
conversion or deemed automatically converted shall be entitled to receive the
number and kind of shares of Capital Stock of this Corporation that such holder
would have owned or been entitled to receive immediately following such action
had such shares
8
17
Series A Preferred Stock
of Series A Preferred Stock been converted immediately prior to the record date
for, or effective date of, as the case may be, such event.
An adjustment made pursuant to this paragraph 5(c) for a
dividend or distribution shall become effective immediately after the record
date for the dividend or distribution and an adjustment made pursuant to this
paragraph 5(c) for a subdivision, combination or reclassification shall become
effective immediately after the effective date of the subdivision, combination
or reclassification. Such adjustment shall be made successively whenever any
action listed above shall be taken.
Any shares of Common Stock issuable in payment of a
dividend shall be deemed to have been issued immediately prior to the time of
the record date for such dividend for purposes of calculating the number of
outstanding shares of Common Stock under paragraph 5(d) below.
(d) If this Corporation consolidates with any other
entity or merges into another entity, or in case of any sale or transfer to
another entity (other than by mortgage or pledge) of all or substantially all of
the properties and assets of this Corporation, or if the Corporation is a party
to a merger or binding share exchange which reclassifies or changes its
outstanding Common Stock, this Corporation (or its successor in such
transaction) or the purchaser of such properties and assets shall make
appropriate provision so that the holder of a Share shall have the right
thereafter to convert such Share into the kind and amount of securities, cash or
other assets that such holder would have owned immediately after such
consolidation, merger, sale or transfer if such holder had converted such Share
into Common Stock immediately prior to the effective date of such consolidation,
merger, sale or transfer (taking into account for this purpose (to the extent
applicable) the valid exercise by such holder of any rights of election made
available to holders of Common Stock, which rights of election shall
simultaneously be made available to holders of Shares on the same basis as if
such Shares had theretofore been converted into shares of Common Stock), and the
holders of the Series A Preferred Stock shall have no other conversion rights
under these provisions; provided that effective provision shall be made, in the
Articles or Certificate of Incorporation of the resulting or surviving
corporation or otherwise or in any contracts of sale or transfer, so that the
provisions set forth herein for the protection of the conversion rights of the
Series A Preferred Stock shall thereafter be made applicable, as nearly as
reasonably may be, to any such other securities and other assets deliverable
upon conversion of the Series A Preferred Stock remaining outstanding or other
convertible preferred stock or other convertible securities received by the
holders of Series A Preferred Stock in place thereof; and provided, further,
that any such resulting or surviving corporation or purchaser shall expressly
assume the obligation to deliver, upon the exercise of the conversion privilege,
such securities, cash or other assets as the holders of the Series A Preferred
Stock remaining outstanding, or other convertible preferred stock or other
convertible securities received by the holders in place thereof, shall be
entitled to receive pursuant to the provisions hereof, and to make provision for
the protection of the conversion rights as above provided.
(e) Subject to paragraph 5(h) and to the remaining
provisions of this paragraph 5(e), in the event that a holder of Series A
Preferred Stock would be entitled to receive
9
18
Series A Preferred Stock
upon conversion thereof pursuant to this paragraph 5 any Redeemable Capital
Stock and this Corporation redeems, exchanges or otherwise acquires all of the
outstanding shares or other units of such Redeemable Capital Stock (such event
being a "Redemption Event"), then, from and after the effective date of such
Redemption Event, the holders of Shares of Series A Preferred Stock then
outstanding shall be entitled to receive upon conversion of such Shares, in lieu
of shares or units of such Redeemable Capital Stock, the kind and amount of
securities, cash and other assets receivable upon the Redemption Event by a
holder of the number of shares or units of such Redeemable Capital Stock into
which such Shares of Series A Preferred Stock could have been converted
immediately prior to the effective date of such Redemption Event (assuming, to
the extent applicable, that such holder failed to exercise any rights of
election with respect thereto and received per share or unit of such Redeemable
Capital Stock the kind and amount of securities, cash and other assets received
per share or unit by a plurality of the non-electing shares or units of such
Redeemable Capital Stock), and (from and after the effective date of such
Redemption Event) the holders of the Series A Preferred Stock shall have no
other conversion rights under these provisions with respect to such Redeemable
Capital Stock.
Notwithstanding the foregoing, if the redemption price
for the shares of such Redeemable Capital Stock is paid in whole or in part in
Redemption Securities, and the Mirror Preferred Stock Condition is met, the
Series A Preferred Stock shall not be convertible into such Redemption
Securities and, from and after the applicable redemption date, the holders of
any shares of Series A Preferred Stock that have not been exchanged for Mirror
Preferred Stock and Exchange Preferred Stock shall have no conversion rights
under these provisions except for any conversion right that may have existed
immediately prior to the effective date of the Redemption Event with respect to
any securities (including the Common Stock), cash or other assets other than the
Redeemable Capital Stock so redeemed. This Corporation shall use all
commercially reasonable efforts to ensure that the Mirror Preferred Stock
Condition is satisfied. The Mirror Preferred Stock Condition will be satisfied
in connection with a redemption of any Redeemable Capital Stock into which the
Series A Preferred Stock is then convertible if appropriate provision is made so
that the holders of the Series A Preferred Stock have the right to exchange
their shares of Series A Preferred Stock on the effective date of the Redemption
Event for Exchange Preferred Stock of this Corporation and Mirror Preferred
Stock of the issuer of the Redemption Securities. The sum of the initial
liquidation preferences of the shares of Exchange Preferred Stock and Mirror
Preferred Stock delivered in exchange for a Share of Series A Preferred Stock
will equal the Liquidation Preference of a share of Series A Preferred Stock on
the effective date of the Redemption Event. The Mirror Preferred Stock will have
an aggregate initial liquidation preference equal to the product of the
aggregate Liquidation Preference of the Shares of Series A Preferred Stock
exchanged therefor and the quotient of (x) the product of the Conversion Rate
for the Redeemable Capital Stock to be redeemed (determined immediately prior to
the effective date of the Redemption Event) and the average of the daily Closing
Prices of the Redeemable Capital Stock for the period of ten consecutive trading
days ending on the third trading day prior to the effective date of the
Redemption Event, divided by (y) the sum of the amount determined pursuant to
clause (x), plus the fair value of the securities (other than the Redeemable
Capital Stock being redeemed), cash or other assets that would have been
receivable by a holder of Series A Preferred Stock upon conversion thereof
immediately prior to the effective date of the Redemption Event (such fair value
to be determined in the case of stock or other securities with a Closing Price
in the same manner as provided in clause (x) and otherwise by the Board of
10
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Series A Preferred Stock
Directors in the exercise of its good faith judgment). The shares of Exchange
Preferred Stock will have an aggregate initial liquidation preference equal to
the difference between the aggregate Liquidation Preference of the Shares of
Series A Preferred Stock exchanged therefor and the aggregate initial
liquidation preference of the Mirror Preferred Stock.
(f) If this Corporation effects a Spin Off, this
Corporation shall make appropriate provision so that the holders of the Series A
Preferred Stock have the right to exchange their Shares of Series A Preferred
Stock on the effective date of the Spin Off for Exchange Preferred Stock of this
Corporation and Mirror Preferred Stock of the issuer of the Spin Off Securities.
The sum of the initial liquidation preferences of the shares of Exchange
Preferred Stock and Mirror Preferred Stock delivered in exchange for a Share of
Series A Preferred Stock will equal the Liquidation Preference of a Share of
Series A Preferred Stock on the effective date of the Spin Off. The Mirror
Preferred Stock will have an aggregate liquidation preference equal to the
product of the aggregate Liquidation Preference of the Shares of Series A
Preferred Stock exchanged therefor and the quotient of (x) the product of the
number (or fraction) of Spin Off Securities that would have been receivable upon
such Spin Off by a holder of the number of shares of Common Stock issuable upon
conversion of a Share of Series A Preferred Stock immediately prior to the
effective date of the Spin Off and the average of the daily Closing Prices of
the Spin Off Securities for the period of ten consecutive trading days
commencing on the tenth trading day following the effective date of the Spin
Off, divided by (y) the sum of the amount determined pursuant to clause (x),
plus the fair value of the shares of Common Stock and other securities (other
than Spin Off Securities), cash or other assets that would have been receivable
by a holder of a Share of Series A Preferred Stock upon conversion thereof
immediately prior to the effective date of the Spin Off (such fair value to be
determined in the case of Common Stock or other securities with a Closing Price
in the same manner as provided in clause (x) and otherwise by the Board of
Directors in the exercise of its good faith judgment). The shares of Exchange
Preferred Stock will have an aggregate initial liquidation preference equal to
the difference between the aggregate Liquidation Preference of the Shares of
Series A Preferred Stock exchanged therefor and the aggregate initial
liquidation preference of the Mirror Preferred Stock. From and after the
effective date of such Spin Off, the holders of any Shares of Series A Preferred
Stock that have not been exchanged for Mirror Preferred Stock and Exchange
Preferred Stock as provided above shall have no conversion rights under these
provisions with respect to such Spin Off Securities.
(g) Whenever the Conversion Rate or the conversion
privilege shall be adjusted as provided in this paragraph 5, this Corporation
shall promptly cause a notice to be mailed to the holders of record of the
Series A Preferred Stock describing the nature of the event requiring such
adjustment, the Conversion Rate in effect immediately thereafter and the kind
and amount of Capital Stock or other securities or cash or other assets into
which the Series A Preferred Stock shall be convertible after such event. Where
appropriate, such notice may be given in advance and included as a part of a
notice required to be mailed under the provisions of paragraph 5(i).
(h) This Corporation may, but shall not be required to,
make any adjustment of the Conversion Rate if such adjustment would require an
increase or decrease of less than 1% in such Conversion Rate; provided, however,
that any adjustments which by reason
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Series A Preferred Stock
of this paragraph 5(h) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this
paragraph 5 shall be made to the nearest cent or the nearest 1/1000th of a
share, as the case may be. In any case in which this paragraph 5(h) shall
require that an adjustment shall become effective immediately after a record
date for such event, the Corporation may defer until the occurrence of such
event (x) issuing to the holder of any Shares of Series A Preferred Stock
converted after such record date and before the occurrence of such event the
additional shares of Common Stock or other Capital Stock issuable upon such
conversion by reason of the adjustment required by such event over and above the
shares of Common Stock or other Capital Stock issuable upon such conversion
before giving effect to such adjustment and (y) paying to such holder cash in
lieu of any fractional interest to which such holder is entitled pursuant to
paragraph 5(m); provided, however, that, if requested by such holder, this
Corporation shall deliver to such holder a due bill or other appropriate
instrument evidencing such holder's right to receive such additional shares of
Common Stock or other Capital Stock, and such cash, upon the occurrence of the
event requiring such adjustment.
To the extent the shares of Series A Preferred Stock
become convertible into cash, no adjustment need be made thereafter as to the
cash. Interest will not accrue on the cash.
(i) In case at any time:
(i) this Corporation shall take any action
which would require an adjustment in the Conversion Rate pursuant to
this paragraph;
(ii) there shall be any capital reorganization
or reclassification of the Common Stock (other than a change in par
value), or any consolidation, merger or binding share exchange to
which the Corporation is a party and for which approval of any
stockholders of this Corporation is required, or any sale, transfer or
lease of all or substantially all of the assets of the Corporation, or
a tender offer for shares of Common Stock of any series representing
at least a majority of the total voting power represented by the
outstanding shares of Common Stock of such series which has been
recommended by the Board of Directors as being in the best interests
of the holders of Common Stock; or
(iii) there shall be a voluntary or involuntary
dissolution, liquidation or winding up of this Corporation;
then, in any such event, this Corporation shall give
written notice to the holders of the Series A Preferred Stock at their
respective addresses as the same appear on the books of the Corporation, at
least twenty days (or ten days in the case of a recommended tender offer as
specified in clause (ii) above) prior to any record date for such action,
dividend or distribution or 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 assets, if any, deliverable upon such
reorganization, reclassification, consolidation, merger, binding share exchange,
sale, transfer, lease, tender offer, dissolution, liquidation or winding up;
provided, however, that any notice required by any event described in clause
(ii) of this paragraph 5(i) shall be given in the
12
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Series A Preferred Stock
manner and at the time that such notice is given to the holders of Common Stock.
Without limiting the obligations of this Corporation to provide notice of
corporate actions hereunder, the failure to give the notice required by this
paragraph 5(i) or any defect therein shall not affect the legality or validity
of any such corporate action of the Corporation or the vote upon such action.
(j) Upon conversion of Series A Preferred Stock
pursuant to paragraph 5(a), the holder shall surrender the certificate or
certificates for such Series A Preferred Stock at the office of this Corporation
or at the office of the transfer agent for the Series A Preferred Stock, which
certificate or certificates, if this Corporation shall so request, shall be duly
endorsed to this Corporation or in blank or accompanied by proper instruments of
transfer to this Corporation or in blank (such endorsements or instruments of
transfer to be in form satisfactory to this Corporation), and shall give written
notice to this Corporation at said office that it elects to convert all or a
part of the Shares represented by said certificate or certificates in accordance
with the terms of this paragraph 5, and shall state in writing therein the name
or names in which such holder wishes the certificates for Common Stock to be
issued. Every such notice of election to convert shall constitute a contract
between the holder of such Series A Preferred Stock and the Corporation, whereby
the holder of such Series A Preferred Stock shall be deemed to subscribe for the
amount of Common Stock which such holder shall be entitled to receive upon
conversion of the number of shares of Series A Preferred Stock to be converted,
and, in satisfaction of such subscription, to deposit the shares of Series A
Preferred Stock to be converted, and thereby this Corporation shall be deemed to
agree that the surrender of the shares of Series A Preferred Stock to be
converted shall constitute full payment of such subscription for Common Stock to
be issued upon such conversion. This Corporation will as soon as practicable
after such deposit of a certificate or certificates for Series A Preferred
Stock, accompanied by the written notice and the statement above prescribed,
issue and deliver at the office of this Corporation or of said transfer agent to
the person for whose account such Series A Preferred Stock was so surrendered,
or to his nominee(s) or, subject to compliance with applicable law,
transferee(s), a certificate or certificates for the number of full shares of
Common Stock to which such holder shall be entitled, together with cash or its
check in lieu of any fraction of a share as hereinafter provided. If surrendered
certificates for Series A Preferred Stock are converted only in part, this
Corporation will issue and deliver to the holder, or to his nominee(s), without
charge therefor, a new certificate or certificates representing the aggregate of
the unconverted Shares.
The person or persons entitled to receive the Common
Stock issuable upon conversion of such Series A Preferred Stock shall be treated
for all purposes as the record holder or holders of such Common Stock on the
Conversion Date. Notwithstanding the foregoing, this Corporation shall not be
required to convert any Shares of Series A Preferred Stock, and no surrender of
Series A Preferred Stock shall be effective for that purpose, while the stock
transfer books of this Corporation are closed for any purpose; but such
surrender shall be effective (assuming all other requirements of this paragraph
5(j) have been satisfied) for conversion, and to constitute the person or
persons entitled to receive the Common Stock issuable upon such conversion as
the record holder(s) of such shares of Common Stock, for all purposes
immediately upon the reopening of such books. Upon conversion of Shares, the
rights of the holder of the Shares so converted, as a holder thereof, will
cease; provided, however, that if the Board of Directors declares any dividend
or makes any distribution on the Series A Preferred
13
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Series A Preferred Stock
Stock pursuant to paragraph 3(a) of this Certificate of Designations and the
Conversion Date for any Shares of Series A Preferred Stock occurs after the
record date for such dividend or distribution and before the payment date for
such dividend or distribution, then the holder of such Shares on such record
date shall be entitled to receive such dividend on such payment date as if such
Conversion Date had not occurred.
The issuance of certificates for shares of Common Stock
upon conversion of Shares of Series A Preferred Stock shall be made without
charge for any issue, stamp or other similar tax in respect of such issuance;
provided, however, if any such certificate is to be issued in a name other than
that of the registered holder of the Share or Shares of Series A Preferred Stock
converted, the person or persons requesting the issuance thereof shall pay to
this Corporation the amount of any tax which may be payable in respect of any
transfer involved in such issuance or shall establish to the satisfaction of
this Corporation that such tax has been paid.
(k) This Corporation shall at all times reserve
and keep available, solely for the purpose of issuance upon conversion of the
outstanding shares of Series A Preferred Stock, such number of shares of Common
Stock (or other Capital Stock) as shall be issuable upon the conversion of all
outstanding Shares, provided that nothing contained herein shall be construed to
preclude this Corporation from satisfying its obligations in respect of the
conversion of the outstanding shares of Series A Preferred Stock by delivery of
shares of Common Stock (or such other Capital Stock) which are held in the
treasury of this Corporation. This Corporation shall take all such corporate and
other actions as from time to time may be necessary to insure that all shares of
Common Stock (or other Capital Stock) issuable upon conversion of shares of
Series A Preferred Stock from time to time will, upon issue, be duly and validly
authorized and issued, fully paid and nonassessable and free of any preemptive
or similar rights.
(l) All shares of Series A Preferred Stock
received by this Corporation upon conversion thereof into Common Stock shall be
retired and shall be restored to the status of authorized and unissued shares of
preferred stock (and may be reissued as part of another series of the preferred
stock of this Corporation, but such shares shall not be reissued as Series A
Preferred Stock).
(m) This Corporation shall not be required to
issue fractional shares of Common Stock or scrip upon conversion of the Series A
Preferred Stock. As to any final fraction of a share of Common Stock which a
holder of one or more Shares would otherwise be entitled to receive upon
conversion of such Shares in the same transaction, this Corporation shall pay a
cash adjustment in respect of such final fraction in an amount equal to the same
fraction of the market value of a full share of Common Stock.
(n) This Corporation shall not, by amendment of
this Certificate of Designations or through any reorganization,
recapitalization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, other than as expressly
permitted by this Certificate of Designations or approved by the requisite vote
or written consent of the holders of Series A Preferred Stock taken or given in
accordance with this Certificate, avoid or seek to avoid the observance or
performance of any of the terms to be
14
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Series A Preferred Stock
observed or performed hereunder by this Corporation, but will at all times in
good faith assist in the carrying out of all the provisions of this paragraph 5
and in the taking of all such action as may be necessary or appropriate in order
to protect the conversion rights of the holders of Series A Preferred Stock
against impairment.
6. Exchange Option.
(a) In the event an Exchange Offer is made by this
Corporation or a Subsidiary thereof (the applicable of the foregoing being the
"Offeror"), the Offeror shall concurrently therewith make an equivalent offer to
the holders of Series A Preferred Stock pursuant to which such holders may
tender Shares, based upon the number of shares of Common Stock into which such
tendered Shares are then convertible (or other stock of this Corporation
receivable by a holder of tendered Shares upon conversion thereof (or upon
conversion of securities receivable by a holder of Shares upon conversion of
such tendered Shares)) (and in lieu of tendering outstanding shares of Common
Stock (or such other stock)), together with such other consideration as may be
required to be tendered pursuant to such Exchange Offer, and receive in exchange
therefor, in lieu of Exchange Securities (and other property, if applicable),
Mirror Preferred Stock with an aggregate liquidation preference equal to the
aggregate Liquidation Preference of the shares of Series A Preferred Stock
exchanged therefor. Whether or not a holder of Shares elects to accept such
offer and tender Shares, no adjustment to the Conversion Rate of the Shares will
be made pursuant to paragraph 5 in connection with the Exchange Offer.
(b) If an Exchange Offer is made as discussed above,
the Offeror shall, concurrently with the distribution of the offering circular
or prospectus and related documents to holders of Common Stock, provide each
holder of Series A Preferred Stock with a notice setting forth the offer
described in paragraph 6(a) above and describing the Exchange Offer, the
Exchange Securities and the Mirror Preferred Stock. Such notice shall be
accompanied by the offering circular, prospectus or similar document provided to
holders of Common Stock in respect of the Exchange Offer and a copy of the
certificate of designations (or similar document) proposed to be filed by the
Offeror in order to establish the Mirror Preferred Stock. No failure to mail the
notice contemplated by this paragraph 6(b) or any defect therein or in the
mailing thereof shall affect the validity of the applicable Exchange Offer.
7. Limitations on Dividends and Redemptions.
If at any time this Corporation shall have declared a
dividend on the Series A Preferred Stock and failed to pay or set aside
consideration sufficient to pay such dividend, or if the Corporation declares a
cash dividend on the shares of Common Stock and fails to pay or set aside the
Participating Dividend required to be paid to the holders of the Series A
Preferred Stock, then (a) this Corporation shall not declare or pay any dividend
on or make any distribution with respect to any Parity Stock or Junior Stock or
set aside any money or assets for any such purpose until such dividend payable
to the holders of Series A Preferred Stock has been paid or consideration
sufficient to pay such dividend has been set aside for such purpose, and (b)
neither this Corporation nor any Subsidiary thereof shall redeem, exchange,
purchase or otherwise acquire any shares of Series A Preferred Stock, Parity
Stock or Junior Stock, or set aside any
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Series A Preferred Stock
money or assets for any such purpose, pursuant to paragraph 5 hereof, a sinking
fund or otherwise, unless all then outstanding shares of any class or series of
Parity Stock that by the terms of the instrument creating or evidencing such
Parity Stock is required to be redeemed under such circumstances are redeemed or
exchanged pursuant to the terms hereof and thereof.
Neither this Corporation nor any Subsidiary thereof
shall redeem, exchange, purchase or otherwise acquire any Parity Stock or Junior
Stock, or set aside any money or assets for any such purpose, if after giving
effect to such redemption, exchange, purchase or other acquisition, the amount
(as determined by the Board of Directors in good faith) that would be available
for distribution to the holders of the Series A Preferred Stock upon
liquidation, dissolution or winding up of the Corporation if such liquidation,
dissolution or winding up were to occur on the date fixed for such redemption,
exchange, purchase or other acquisition of such Parity Stock or Junior Stock
would be less than the aggregate Liquidation Preference as of such date of all
shares of Series A Preferred Stock then outstanding.
Nothing contained in this paragraph 7 shall prevent (i)
the payment of dividends on any Junior Stock solely in shares of Junior Stock or
the redemption, purchase or other acquisition of Junior Stock solely in exchange
for (together with a cash adjustment for fractional shares, if any) shares of
Junior Stock, or (ii) the payment of dividends on any Parity Stock solely in
shares of Parity Stock and/or Junior Stock or the redemption, exchange, purchase
or other acquisition of Parity Stock solely in exchange for (together with a
cash adjustment for fractional shares, if any), or through the application of
the proceeds from the sale of, shares of Parity Stock and/or Junior Stock.
All provisions of this paragraph 7 are for the sole
benefit of the holders of Series A Preferred Stock and accordingly, if the
holders of shares of Series A Preferred Stock shall have waived (as provided in
paragraph 9) in whole or in part the benefit of the applicable provisions,
either generally or in the specific instance, such provision shall not (to the
extent of such waiver, in the case of a partial waiver) restrict the redemption,
exchange, purchase or other acquisition of, or declaration, payment or making of
any dividends or distributions on the Series A Preferred Stock, any Parity Stock
or any Junior Stock.
8. Voting Rights. Prior to the expiration or termination
of the waiting period under the HSR Act with respect to the acquisition by the
initial record holder of the Series A Preferred Stock of in excess of $15
million in voting securities of this Corporation, the holders of Series A
Preferred Stock shall have no voting rights whatsoever, except as required by
law and except for the voting rights described in paragraph 9. Following such
expiration or termination of the waiting period under the HSR Act, in connection
with any matter as to which the holders of Common Stock are entitled to vote
including, but not limited to, the election of directors, each share of Series A
Preferred Stock issued and outstanding as of the record date for such meeting
shall have (and the holder of record thereof shall be entitled to cast) one vote
for each share of Series A Preferred Stock. Except as provided in paragraph 9
and except as otherwise may be required by law, the holders of Common Stock, the
holders of Series A Preferred Stock and the holders of any other class or series
of Preferred Stock entitled to vote thereon shall be entitled to notice of and
to attend any meeting of stockholders and to vote together as a single class.
Except as otherwise required by law, the holders of Series A Preferred Stock
shall have no other voting
16
25
Series A Preferred Stock
rights. Without limiting the generality of the foregoing, no vote or consent of
the holders of Series A Preferred Stock shall be required for (a) the creation
of any indebtedness of any kind of the Corporation, (b) the creation or
designation of any class or series of Senior Stock, Parity Stock or Junior
Stock, or (c) any amendment to the Certificate that would increase the number of
authorized shares of Preferred Stock or the number of authorized shares of
Series A Preferred Stock or that would decrease the number of authorized shares
of Preferred Stock or the number of authorized shares of Series A Preferred
Stock (but not below the number of shares of Preferred Stock or Series A
Preferred Stock, as the case may be, then outstanding).
9. Waiver. Any provision of this Certificate of
Designations which, for the benefit of the holders of Series A Preferred Stock,
prohibits, limits or restricts actions by the Corporation, or imposes
obligations on the Corporation, including but not limited to provisions relating
to the obligation of the Corporation to redeem or convert such Shares, may be
waived in whole or in part, or the application of all or any part of such
provision in any particular circumstance or generally may be waived, in each
case by the affirmative vote or with the consent of the holders of record of at
least 66-2/3% of the number of Shares then outstanding (or such greater
percentage thereof as may be required by this Certificate of Designations,
applicable law or any applicable rules of any national securities exchange or
national interdealer quotation system), either in writing or by vote at an
annual meeting or a special meeting called for such purpose at which the holders
of Series A Preferred Stock shall vote as a separate class.
10. Preemptive Rights. The holders of the Series A
Preferred Stock will not have any preemptive right to subscribe for or purchase
any shares of stock or any other securities which may be issued by this
Corporation.
11. Exclusion of Other Rights. Except as may otherwise
be required by law and for the equitable rights and remedies that may otherwise
be available to holders of Series A Preferred Stock, the shares of Series A
Preferred Stock shall not have any designations, preferences, limitations or
relative rights, other than those specifically set forth in these resolutions
(as such resolutions may, subject to paragraph 9, be amended from time to time)
and in the Certificate of Incorporation of this Corporation.
12. Headings. The headings of the various paragraphs and
subparagraphs hereof are for convenience of reference only and shall not affect
the interpretation of any of the provisions hereof.
FURTHER RESOLVED, that the appropriate officers of this
Corporation are hereby authorized to execute and acknowledge a certificate
setting forth these resolutions and to cause such certificate to be filed and
recorded, in accordance with the requirements of Section 151(g) of the General
Corporation Law of the State of Delaware."
17
26
Series A Preferred Stock
The undersigned has signed this Certificate of
Designations on this 10th day of August, 2000.
------------------------------------------
Name:
Title:
18
27
Series B Preferred Stock
ON COMMAND CORPORATION
CERTIFICATE OF DESIGNATIONS
---------
SETTING FORTH A COPY OF A RESOLUTION
CREATING AND AUTHORIZING THE ISSUANCE
OF A SERIES OF PREFERRED STOCK DESIGNATED AS
"CUMULATIVE REDEEMABLE PREFERRED STOCK, SERIES B"
ADOPTED BY THE BOARD OF DIRECTORS
OF ON COMMAND CORPORATION
---------
The undersigned, a Vice President of ON COMMAND CORPORATION, a
Delaware corporation (this "Corporation"), HEREBY CERTIFIES that the Board of
Directors of this Corporation on March 5, 2001, duly adopted the following
resolutions creating a new series of this Corporation's Preferred Stock:
"BE IT RESOLVED, that pursuant to authority expressly granted
by the provisions of Article IV of the Amended and Restated Certificate of
Incorporation of this Corporation, the Board of Directors hereby creates and
authorizes the issuance of a new series of this Corporation's preferred stock,
par value $.01 per share ("Preferred Stock"), and hereby fixes the powers,
designations, dividend rights, voting powers, rights on liquidation, conversion
rights, redemption rights and other preferences and relative, participating,
optional or other special rights and the qualifications, limitations or
restrictions of the shares of such series (in addition to the powers,
designations, preferences and relative, participating, optional or other special
rights and the qualifications, limitations or restrictions thereof set forth in
the Amended and Restated Certificate of Incorporation that are applicable to
each class and series of Preferred Stock), as follows:
28
Series B Preferred Stock
1. Designation and Number. The designation of the series of
Series Preferred Stock, par value $.01 per share, of this Corporation authorized
hereby is "Cumulative Redeemable Preferred Stock, Series B" (the "Series B
Preferred Stock"). The number of shares constituting the Series B Preferred
Stock shall be 15,000 shares.
2. Certain Definitions. Unless the context otherwise requires,
the terms defined in this paragraph 2 shall, for all purposes of this
Certificate of Designations, have the meanings herein specified:
"Board of Directors": The Board of Directors of this
Corporation and, to the extent permitted by law, unless the context indicates
otherwise, any committee thereof authorized with respect to any particular
matter to exercise the power of the Board of Directors of this Corporation with
respect to such matter.
"Business Day: Any day other than a Saturday, Sunday or a day
on which banking institutions in Denver, Colorado are not required to be open.
"Capital Stock": Any and all shares, interests, participations
or other equivalents (however designated) of corporate stock of this
Corporation.
"Common Stock": The Common Stock, par value $.01 per share, of
this Corporation, as such exists on the date of this Certificate of
Designations, and Capital Stock of any other class or series into which such
Common Stock may thereafter have been changed.
"Credit Agreement": The Credit Agreement among the Corporation
and the lenders signatory thereto, Toronto Dominion (Texas), Inc. and Fleet
National Bank, as the documentation agents, Bank Of America, N.A., as the
syndication agent, The Bank Of New York Company, Inc., as the Swingline Lender
(as defined therein), and The Bank Of New York, as the Issuing Bank (as defined
therein) and as the administrative agent for the lenders, dated as of July 18,
2000, as the same may be amended, supplemented, modified, substituted,
increased, replaced or extended from time to time.
"Default": The occurrence of any of the following events:
(a) there shall be entered a decree or order for relief in
respect of the Corporation under Title 11 of the United States Code, as now
constituted or hereafter amended, or any other applicable federal or state
bankruptcy law or other similar law, or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator, or similar official of the
Corporation or of any substantial part of its properties, or ordering the
winding-up or liquidation of the affairs of the Corporation or an involuntary
petition shall be filed against the Corporation and a temporary stay entered,
and (i) such petition and stay shall not be diligently contested, or
2
29
Series B Preferred Stock
(ii) any such petition and stay shall continue undismissed for a period of sixty
(60) consecutive days; or
(b) the Corporation shall file a petition, answer, or consent
seeking relief under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy law or
other similar law, or the Corporation shall consent to the institution of
proceedings thereunder or to the filing of any such petition or to the
appointment or taking of possession of a receiver, liquidator, assignee,
trustee, custodian, sequestrator, or other similar official, of the Corporation
or of any substantial part of its properties, or the Corporation shall fail
generally to pay its debts as they become due, or shall take any action in
furtherance of any such action.
"Dividend Payment Date": The fifteenth (15th) day of each
month, commencing with April 15, 2001, or the next succeeding Business Day if
any such date is not a Business Day.
"Dividend Period": The period from and including the Issue
Date to but excluding the first Dividend Payment Date and, thereafter, each
monthly period from and including a Dividend Payment Date to but excluding the
next Dividend Payment Date.
"Exchange Act": The Securities Exchange Act of 1934, as
amended.
"Issue Date": March 5, 2001, such date being the first date on
which any shares of the Series B Preferred Stock are first issued or deemed to
have been issued.
"Junior Securities": All shares of Common Stock, the
Convertible Participating Preferred Stock, Series A, par value $.01 per share
(the "Series A Preferred Stock") and any other class or series of Capital Stock
of this Corporation, whether now existing or hereafter created, to the extent
that it ranks junior to the Series B Preferred Stock with respect to dividend
rights, rights on redemption or rights on liquidation, as the case may be. A
class or series of Capital Stock shall rank junior to the Series B Preferred
Stock as to dividend rights, rights on redemption or rights on liquidation if
the holders of shares of Series B Preferred Stock shall be entitled to dividend
payments, payments on redemption or payments of amounts distributable upon
liquidation, dissolution or winding up of the affairs of this Corporation, as
the case may be, in preference or priority to the holders of shares of such
class or series.
"Liquidation Preference": Measured per Share of the Series B
Preferred Stock as of any date in question (the "Relevant Date") shall mean an
amount equal to the sum of (a) the Stated Value of such Share, plus (b) an
amount equal to all dividends accrued on such Share which pursuant to paragraph
3(c) of this Certificate of Designations have been added to and remain a part of
the Liquidation Preference as of the Relevant Date, plus (c) for purposes of
paragraph 4 and paragraph 5 of this Certificate of Designations and the
definition of Redemption Price, an amount equal to all unpaid dividends accrued
on the sum of the amounts specified in
3
30
Series B Preferred Stock
clauses (a) and (b) above during the period from and including the immediately
preceding Dividend Payment Date (or the Issue Date if the Relevant Date is on or
prior to the first Dividend Payment Date) to but excluding the Relevant Date,
and, in the case of clauses (b) and (c) hereof, whether or not such unpaid
dividends have been declared or there are any unrestricted funds of the
Corporation legally available for the payment of dividends. In connection with
the determination of the Liquidation Preference of a Share of Series B Preferred
Stock upon redemption, or upon liquidation, dissolution or winding up of the
Corporation, the Relevant Date shall be the applicable date of redemption or the
date of distribution of amounts payable to stockholders in connection with any
such liquidation, dissolution or winding up.
"Parity Securities": Any class or series of Capital Stock of
this Corporation, whether now existing or hereafter created, ranking on a parity
basis with the Series B Preferred Stock with respect to dividend rights, rights
on redemption or rights on liquidation, as the case may be. A class or series of
Capital Stock shall rank on a parity basis with the Series B Preferred Stock as
to dividend rights, rights on redemption or rights on liquidation, whether or
not the dividend rates, dividend payment dates, redemption or liquidation prices
per share, or sinking fund or mandatory redemption provisions, if any, are
different from those of the Series B Preferred Stock, if the holders of shares
of such class or series shall be entitled to dividend payments, payments on
redemption or payments of amounts distributable upon liquidation, dissolution or
winding up of the affairs of the Corporation, as the case may be, in proportion
to their respective accumulated and accrued and unpaid dividends, redemption
prices or liquidation prices, respectively, without preference or priority, one
over the other, as between the holders of shares of such class or series and the
holders of Series B Preferred Stock. No class or series of Capital Stock that
ranks junior to the Series B Preferred Stock as to rights on liquidation shall
rank or be deemed to rank on a parity basis with the Series B Preferred Stock as
to dividend rights or rights of redemption, unless the instrument creating or
evidencing such class or series of Capital Stock otherwise expressly provides.
"person": A natural person, corporation, limited liability
company, partnership or other legal entity.
"Purchase Agreement": The Preferred Stock Purchase Agreement,
dated March 5, 2001, between this Corporation and Ascent Entertainment Group,
Inc., a Delaware corporation, providing for the purchase of shares of Series B
Preferred Stock.
"Record Date": For the dividends payable on any Dividend
Payment Date, the first day of the month during which such Dividend Payment Date
shall occur or the next succeeding Business Day if any such date is not a
Business Day, as and if designated by the Board of Directors.
"Redemption Date": As to any Share, the date, which shall be a
Business Day, fixed for redemption of such Share as specified in the notice of
redemption given in accordance
4
31
Series B Preferred Stock
with paragraph 5(c), provided that no such date will be a Redemption Date unless
the applicable Redemption Price is actually paid on such date or the
consideration sufficient for the payment thereof, and for no other purpose, has
been set apart, and if the Redemption Price is not so paid in full or the
consideration sufficient therefor so set apart then the Redemption Date will be
the date, which shall be a Business Day, on which such Redemption Price is fully
paid or the consideration sufficient for the payment thereof, and for no other
purpose, has been set apart.
"Redemption Price": As to any Share that is to be redeemed on
any Redemption Date, the Liquidation Preference as in effect on such Redemption
Date.
"Senior Securities": Any class or series of Capital Stock of
this Corporation, whether now existing or hereafter created, ranking senior to
the Series B Preferred Stock with respect to dividend rights, rights of
redemption or rights on liquidation. A class or series of Capital Stock shall
rank senior to the Series B Preferred Stock as to dividend rights, rights of
redemption or rights on liquidation if the holders of shares of such class or
series shall be entitled to dividend payments, payments on redemption or
payments of amounts distributable upon dissolution, liquidation or winding up of
the affairs of this Corporation, as the case may be, in preference or priority
to the holders of shares of Series B Preferred Stock. No class or series of
Capital Stock that ranks on a parity basis with or junior to the Series B
Preferred Stock as to rights on liquidation shall rank or be deemed to rank
prior to the Series B Preferred Stock as to dividend rights or rights on
redemption, notwithstanding that the dividend rate, dividend payment dates,
sinking fund provisions, if any, or mandatory redemption provisions thereof are
different from those of the Series B Preferred Stock, unless the instrument
creating or evidencing such class or series of Capital Stock otherwise expressly
provides.
"Share": A share of Series B Preferred Stock.
"Stated Value": Of a Share of the Series B Preferred Stock,
$1,000.
"Subsidiary": With respect to any person, any corporation,
limited liability company, partnership or other legal entity more than 50% of
whose outstanding voting securities or membership, partnership or other
ownership interests, as the case may be, are directly or indirectly owned by
such person.
3. Dividends.
(a) Subject to the prior preferences and other rights of any
Senior Securities, the holders of Series B Preferred Stock shall be entitled to
receive cumulative dividends, in preference to dividends on any Junior
Securities, which shall accrue as provided herein. Dividends on each Share will
accrue on a daily basis at the rate of 8.5% per annum of the Liquidation
Preference of such Share from and including the Issue Date to but excluding the
first Dividend Payment Date, and at a rate of 12% per annum of the Liquidation
Preference of such
5
32
Series B Preferred Stock
Share from and including such first Dividend Payment Date to but excluding the
date on which the Liquidation Preference or Redemption Price of such Share is
made available pursuant to paragraph 4 or 5, respectively, of this Certificate
of Designations, as applicable; provided, however, that dividends added to the
Liquidation Preference of a Share as provided in paragraph 3(c) shall accrue
dividends on a daily basis at the rate of 12% per annum. Dividends shall accrue
as provided herein whether or not such dividends have been declared and whether
or not there are any unrestricted funds of this Corporation legally available
for the payment of dividends. Accrued dividends on the Series B Preferred Stock
shall be payable monthly on each Dividend Payment Date to the holders of record
of the Series B Preferred Stock as of the close of business on the applicable
Record Date. For purposes of determining the amount of dividends "accrued" (i)
as of the first Dividend Payment Date and as of any date that is not a Dividend
Payment Date, such amount shall be calculated on the basis of the applicable
rate per annum specified above in this paragraph 3(a) for the actual number of
days elapsed from and including the Issue Date (in the case of the first
Dividend Payment Date and any date prior to the first Dividend Payment Date) or
the last preceding Dividend Payment Date (in the case of any other date) to but
excluding the date as of which such determination is to be made, based on a
365-day year, and (ii) as of any Dividend Payment Date after the first Dividend
Payment Date, such amount shall be calculated on the basis of such rate per
annum based on a 360-day year of twelve 30-day months.
(b) All dividends payable with respect to the Shares shall be
declared and paid in cash. Payment of such dividends as provided herein shall be
deemed to have been made when such payment has been delivered to the record
holders of the Series B Preferred Stock entitled to receive the same by wire
transfer of immediately available funds in accordance with the instructions of
such holders delivered in writing to the Corporation at least two Business Days
prior to any Dividend Payment Date (or if no such instructions are received, by
check delivered by certified mail, return receipt requested, to the address of
such record holder on the books of the Corporation). All dividends paid with
respect to the Shares pursuant to this paragraph 3 shall be paid pro rata to all
the holders of Shares outstanding on the applicable Record Date or Special
Record Date, as the case may be.
(c) If on any Dividend Payment Date this Corporation, pursuant
to applicable law or otherwise, shall be prohibited or restricted from paying
the full dividends to which holders of Series B Preferred Stock, and any Parity
Securities ranking on a parity basis with the Series B Preferred Stock with
respect to the right to receive dividend payments, shall be entitled, the amount
available for such payment pursuant to applicable law and which is not otherwise
restricted (if any) shall be distributed among the holders of Series B Preferred
Stock and any such Parity Securities ratably in proportion to the full amounts
to which they would otherwise be entitled. On each Dividend Payment Date, all
dividends that have accrued on each share of Series B Preferred Stock during the
Dividend Period ending on such Dividend Payment Date shall, to the extent not
paid on such Dividend Payment Date for any reason (whether or not such
6
33
Series B Preferred Stock
unpaid dividends have been declared or there are any unrestricted funds of this
Corporation legally available for the payment of dividends), be added
cumulatively to the Liquidation Preference of such Share and will remain a part
thereof until such dividends and all dividends accrued thereon are paid. That
portion of the Liquidation Preference of a Share that consists of accrued unpaid
dividends, together with all dividends accrued in respect thereof, may be
declared and paid at any time (subject to the rights of any Senior Securities
and to the concurrent satisfaction of any dividend arrearages then existing with
respect to any Parity Securities that rank on a parity basis with the Series B
Preferred Stock as to the payment of dividends), without reference to any
regular Dividend Payment Date, to holders of record as of the close of business
on such date, not more than 20 days nor less than 10 days preceding the payment
date thereof, as may be fixed by the Board of Directors (the "Special Record
Date"). Notice of each Special Record Date shall be given, not more than 20 days
nor less than 10 days prior thereto, to the holders of record of the Shares. Any
dividend payment made on the Shares shall first be credited against the earliest
accrued but unpaid dividend due with respect to such Shares.
(d) If at any time this Corporation shall have failed to pay,
or declare and set aside the consideration sufficient to pay, full cumulative
dividends on the Series B Preferred Stock for all Dividend Periods ending on or
before the immediately preceding Dividend Payment Date, and until full
cumulative dividends on the Series B Preferred Stock for all Dividend Periods
ending on or before the immediately preceding Dividend Payment Date are paid, or
declared and the consideration sufficient to pay the same in full is set aside
so as to be available for such purpose and no other purpose, (i) this
Corporation shall not redeem, or discharge any sinking fund obligation with
respect to, any Shares, Parity Securities or Junior Securities, or set aside any
money or assets for any such purpose, unless all then outstanding Shares are
redeemed pursuant to the terms hereof, (ii) this Corporation shall not declare
or pay any dividend on or make any distribution with respect to any Junior
Securities or Parity Securities or set aside any money or assets for any such
purpose, except that this Corporation may declare and pay a dividend on any
Parity Securities ranking on a parity basis with the Series B Preferred Stock
with respect to the right to receive dividend payments, contemporaneously with
the declaration and payment of a dividend on the Series B Preferred Stock,
provided that such dividends are declared and paid pro rata so that the amount
of dividends declared and paid per share of Series B Preferred Stock and such
Parity Securities shall in all cases bear to each other the same ratio that
accumulated and accrued and unpaid dividends per share on the Series B Preferred
Stock and such Parity Securities bear to each other, and (iii) neither this
Corporation nor any Subsidiary thereof shall purchase or otherwise acquire any
Shares, Parity Securities or Junior Securities.
Nothing contained in the preceding paragraph of this paragraph
3(d) shall prevent (x) the payment of dividends on any Junior Securities solely
in shares of Junior Securities or the redemption, purchase or other acquisition
of Junior Securities solely in exchange for shares of Junior Securities, (y) the
payment of dividends on any Parity Securities solely in shares of Junior
Securities or the redemption, exchange, purchase or other acquisition of Series
B Preferred Stock
34
Series B Preferred Stock
or Parity Securities solely in exchange for (together with a cash adjustment for
fractional shares, if any) shares of Junior Securities; or (z) the purchase or
acquisition of Shares pursuant to a purchase or exchange offer or offers made to
all holders of outstanding shares of Series B Preferred Stock; provided that the
terms of the purchase or exchange offer shall be identical for all shares of
Series B Preferred Stock and all accrued dividends on such Shares shall have
been paid or shall have been declared and irrevocably set apart in trust for the
benefit of the holders of shares of Series B Preferred Stock and for no other
purpose. The provisions of this paragraph 3(d) are for the benefit of the
holders of Series B Preferred Stock and accordingly the provisions of this
paragraph 3(d) shall not restrict any redemption or purchase by this Corporation
or a Subsidiary thereof of Shares held by any holder, provided that all other
holders of Shares shall have waived in writing the benefits of this provision
with respect to such redemption.
4. Liquidation. Upon any liquidation, dissolution or winding
up of this Corporation, whether voluntary or involuntary, the holders of Series
B Preferred Stock shall be entitled to be paid an amount in cash equal to the
aggregate Liquidation Preference at the date of payment of all Shares
outstanding, which amounts shall be paid (x) before any distribution or payment
upon any such liquidation, dissolution or winding up of this Corporation is made
upon any Junior Securities, (y) on a pari passu basis with any such payment made
to the holders of any Parity Securities, and (z) after any such payment is made
upon any Senior Securities. The holders of Series B Preferred Stock shall be
entitled to no other or further distribution of or participation in any
remaining assets of this Corporation after receiving the full preferential
amounts provided for in the preceding sentence. If upon such liquidation,
dissolution or winding up, the assets of this Corporation to be distributed
among the holders of Series B Preferred Stock and to all holders of Parity
Securities are insufficient to permit payment in full to such holders of the
aggregate preferential amounts which they are entitled to be paid, then the
entire assets of this Corporation to be distributed to such holders shall be
distributed ratably among them based upon the full preferential amounts to which
the shares of Series B Preferred Stock and such Parity Securities would
otherwise respectively be entitled. Upon any such liquidation, dissolution or
winding up, after the holders of Series B Preferred Stock and Parity Securities
have been paid in full the amounts to which they are entitled, the remaining
assets of this Corporation may be distributed to the holders of Junior
Securities. This Corporation shall mail written notice of such liquidation,
dissolution or winding up to each record holder of Series B Preferred Stock not
less than 20 days prior to the payment date stated in such written notice.
Neither the consolidation or merger of this Corporation into or with any other
corporation or corporations, nor the sale, transfer or lease by this Corporation
of all or any part of its assets, shall be deemed to be a liquidation,
dissolution or winding up of this Corporation within the meaning of this
paragraph 4.
5. Redemption.
(a) Subject to paragraph 5(f), the shares of Series B
Preferred Stock may be redeemed out of funds legally available therefor, at the
option of this Corporation by action of
8
35
Series B Preferred Stock
the Board of Directors, in whole or from time to time in part, on any Business
Day after the Issue Date at the Redemption Price per Share as of the applicable
Redemption Date. If less than all outstanding Shares are to be redeemed, Shares
shall be redeemed ratably (as nearly as may be practicable) among the holders
thereof.
(b) Subject to the rights of any Parity Securities and the
provisions of paragraph 5(f) and subject to any prohibitions or restrictions
contained in the Credit Agreement, at any time on or after the first Dividend
Payment Date or prior thereto if a Default has occurred and during the
continuance thereof, any holder of Shares shall have the right, at such holder's
option, to require redemption by this Corporation at the Redemption Price per
Share as of the applicable Redemption Date of all or any portion of such
holder's Shares, by written notice to this Corporation stating the number of
Shares to be redeemed. This Corporation shall redeem, out of funds legally
available therefor and not restricted in accordance with the first sentence of
this paragraph 5(b), the Shares so requested to be redeemed on such date within
10 days following this Corporation's receipt of such notice as this Corporation
shall state in its notice given pursuant to paragraph 5(c). If the funds of this
Corporation legally available for redemption of Shares and not restricted in
accordance with the first sentence of this paragraph 5(b) are insufficient to
redeem the total number of Shares required to be redeemed pursuant to this
paragraph 5(b), then, those funds which are legally available for redemption of
such Shares and not so restricted will be used to redeem the maximum possible
number of such Shares ratably among the holders who have required Shares to be
redeemed under this paragraph 5(b). At any time thereafter when additional funds
of this Corporation are legally available and not so restricted for such
purpose, such funds will immediately be used to redeem the Shares this
Corporation failed to redeem on such Redemption Date until the balance of such
Shares are redeemed. Further, if the funds of this Corporation legally available
for redemption of Shares are sufficient to pay the Redemption Price of the
Shares requested to be redeemed in full, then any portion of such Redemption
Price not paid when due as provided in this paragraph 5(b), notwithstanding that
payment thereof is restricted pursuant to the Credit Agreement in accordance
with the first sentence of this paragraph 5(b), shall constitute indebtedness of
this Corporation for borrowed money, the payment of which indebtedness the
holders requesting such redemption shall be entitled to enforce by the exercise
of any and all rights at law or in equity.
(c) Notice of any redemption pursuant to this paragraph 5
shall be mailed, first class, postage prepaid, not less than 5 days nor more
than 30 days prior to the Redemption Date, to the holders of record of the
shares of Series B Preferred Stock to be redeemed, at their respective addresses
as the same appear upon the books of this Corporation or are supplied by them in
writing to this Corporation for the purpose of such notice; but no failure to
mail such notice or any defect therein or in the mailing thereof shall affect
the validity of the proceedings for the redemption of any shares of the Series B
Preferred Stock. Such notice shall set forth the Redemption Price, the
Redemption Date, the number of Shares to be redeemed and the place at
9
36
Series B Preferred Stock
which the Shares called for redemption will, upon presentation and surrender of
the stock certificates evidencing such Shares, be redeemed. In case fewer than
the total number of shares of Series B Preferred Stock represented by any
certificate are redeemed, a new certificate representing the number of
unredeemed Shares will be issued to the holder thereof without cost to such
holder.
(d) If notice of any redemption by this Corporation pursuant
to this paragraph 5 shall have been mailed as provided in paragraph 5(c) and if
on or before the Redemption Date specified in such notice the consideration
necessary for such redemption shall have been set apart so as to be available
therefor and only therefor, then on and after the close of business on the
Redemption Date, the Shares called for redemption, notwithstanding that any
certificate therefor shall not have been surrendered for cancellation, shall no
longer be deemed outstanding, and all rights with respect to such Shares shall
forthwith cease and terminate, except the right of the holders thereof to
receive upon surrender of their certificates the consideration payable upon
redemption thereof.
(e) All shares of Series B Preferred Stock redeemed, retired,
purchased or otherwise acquired by this Corporation shall be retired and shall
be restored to the status of authorized and unissued shares of preferred stock
(and may be reissued as part of another series of the preferred stock of this
Corporation, but such shares shall not be reissued as Series B Preferred Stock).
(f) If and so long as this Corporation shall fail to redeem on
a Redemption Date pursuant to this paragraph 5 all shares of Series B Preferred
Stock required to be redeemed on such date, this Corporation shall not redeem,
or discharge any sinking fund obligation with respect to, any Shares, Junior
Securities or Parity Securities, or set aside any money or assets for any such
purpose, unless all then outstanding Shares required to be redeemed are redeemed
pursuant to the terms hereof, and shall not declare or pay any dividend on or
make any distribution with respect to any Junior Securities or set aside any
money or assets for any such purpose, and neither this Corporation nor any
Subsidiary thereof shall purchase or otherwise acquire any Shares, Parity
Securities or Junior Securities. Nothing contained in this paragraph 5(f) shall
prevent the purchase or acquisition of shares of Series B Preferred Stock
pursuant to a purchase or exchange offer or offers made to all holders of
outstanding shares of Series B Preferred Stock, provided that the terms of the
purchase or exchange offer shall be identical for all Shares and all accrued
dividends on such Shares shall have been declared and irrevocably set apart in
trust for the benefit of the holders of Shares and for no other purpose. The
provisions of this paragraph 5(f) are for the benefit of holders of Series B
Preferred Stock and accordingly the provisions of this paragraph 5(f) shall not
restrict any redemption or purchase by this Corporation or a Subsidiary thereof
of Shares held by any holder, provided that all other holders of Shares shall
have waived in writing the benefits of this provision with respect to such
redemption.
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Series B Preferred Stock
6. Voting Rights. The holders of the Series B Preferred Stock
shall have no voting rights whatsoever, except as required by law, as provided
in paragraph 9 or as provided in this paragraph 6. For so long as any Shares
remain outstanding, this Corporation will not, either directly or indirectly,
without the consent of the holders of record of at least 66 2/3% of the number
of Shares then outstanding, take any action (including by merger, consolidation
or statutory share exchange with any other corporation or entity) to amend,
alter or repeal (i) any of the provisions hereof or (ii) any of the provisions
of the Amended and Restated Certificate of Incorporation of this Corporation so
as to affect adversely any preference or any relative or other right given to
the Series B Preferred Stock.
7. Waiver. Any provision of this Certificate of Designations
which, for the benefit of the holders of Series B Preferred Stock, prohibits,
limits or restricts actions by the Corporation, or imposes obligations on the
Corporation, including but not limited to provisions relating to the obligation
of the Corporation to redeem or convert such Shares, may be waived in whole or
in part, or the application of all or any part of such provision in any
particular circumstance or generally may be waived, in each case by the
affirmative vote or with the consent of the holders of record of at least
66 2/3% of the number of Shares then outstanding (or such greater percentage
thereof as may be required by this Certificate of Designations, applicable law
or any applicable rules of any national securities exchange or national
interdealer quotation system), either in writing or by vote at an annual meeting
or a special meeting called for such purpose at which the holders of Series B
Preferred Stock shall vote as a separate class.
8. Preemptive Rights. The holders of the Series B Preferred
Stock will not have any preemptive right to subscribe for or purchase any shares
of Capital Stock or any other securities which may be issued by this
Corporation.
9. Senior or Parity Securities. The Series B Preferred Stock
shall not rank junior to any other classes or series of Capital Stock of this
Corporation in respect of the right to receive dividends, rights of redemption
or the right to participate in any liquidation, dissolution or winding up of
this Corporation. Without the prior consent of the holders of record of at least
662/3% of the number of Shares then outstanding, this Corporation shall not
issue any Senior Securities or Parity Securities.
10. Claims. In the event of any action at law or suit in
equity with respect to the Series B Preferred Stock, this Corporation, in
addition to all other sums which it may be required to pay, will pay a
reasonable sum for attorney's fees incurred by the holders of the Series B
Preferred Stock in connection with such action or suit and all other costs of
collection. The Corporation shall not assert its right to trial by jury in any
action, suit or proceeding arising from or related to this Series B Preferred
Stock.
11. Exclusion of Other Rights. Except as may otherwise be
required by law and for the equitable rights and remedies that may otherwise be
available to holders of Series B
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Series B Preferred Stock
Preferred Stock, the shares of Series B Preferred Stock shall not have any
designations, preferences, limitations or relative rights, other than those
specifically set forth in these resolutions (as such resolutions may, subject to
paragraph 6, be amended from time to time) and in the Amended and Restated
Certificate of Incorporation of this Corporation.
12. Headings. The headings of the various paragraphs and
subparagraphs hereof are for convenience of reference only and shall not affect
the interpretation of any of the provisions hereof.
FURTHER RESOLVED, that the appropriate officers of this
Corporation are hereby authorized to execute and acknowledge a certificate
setting forth these resolutions and to cause such certificate to be filed and
recorded, in accordance with the requirements of Section 151(g) of the General
Corporation Law of the State of Delaware."
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39
Series B Preferred Stock
The undersigned has signed this Certificate of Designations on
this 5th day of March, 2001.
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Name: Betram Perkel
Title: Vice President
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