Exhibit 3.1.1
CERTIFICATE OF DESIGNATION
OF
TAKE-TWO INTERACTIVE SOFTWARE, INC.
Certificate Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
We, being, respectively, the Chief Executive Officer and Assistant
Secretary of Take-Two Interactive Software, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), DO HEREBY CERTIFY:
Pursuant to authority expressly vested in the Board of Directors of said
Corporation by the provisions of its Certificate of Incorporation, said Board
of Directors duly adopted the following resolution on March 10, 1998:
RESOLVED, that the Board of Directors, pursuant to authority expressly
vested in it by the provisions of the Certificate of Incorporation of the
Corporation, hereby authorizes the issue from time to time of a series of
Preferred Stock, $.01 par value, of the Corporation and hereby fixes the
designation, preferences and relative, participating, optional or other
rights, and the qualifications, limitations or restrictions thereof, as
follows:
Section 1. Designation. The series of Preferred Stock shall be designated
and known as "Series A Preferred Stock" (the "Series A Preferred Stock"). The
number of shares constituting such series shall be 1,850,000.
Section 2. Dividend Rights. When and if the Board of Directors declares
any dividend of cash, securities, or other property payable with respect to
Common Stock, the holders of the Series A Preferred Stock shall be entitled to
receive, on the date such dividend is paid with respect to the Common Stock,
such cash, securities, and/or other property as is payable with respect to the
number of shares of Common Stock into which such Series A Preferred Stock was
convertible on the record date for such dividend.
Section 3. Liquidation Rights. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of the
Corporation, each holder of Series A Preferred Stock shall be entitled to
receive, prior and in preference to any distribution of any of the assets or
surplus funds of the Corporation to the holders of the Common Stock or any
other series of Preferred Stock of the Corporation by reason of their
ownership thereof, an amount equal to $6.875 per share.
All of the preferential amounts to be paid to the holders of the Series A
Preferred Stock under this Section 3 shall be paid or set apart for payment
before the payment or setting apart for payment of any amount for, or the
distribution of any assets of the Corporation to, the holders of the Common
Stock or any other series of Preferred Stock in connection with such
liquidation, dissolution or winding up. After the payment or the setting apart
of payment to the holders of the Series A Preferred Stock of the preferential
amounts so payable to them, the holders of Common Stock shall be entitled to
receive all remaining assets of the Corporation.
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If the assets or surplus funds to be distributed to the holders of the
Series A Preferred Stock are insufficient to permit the payment to such
holders of their preferential amount, the assets and surplus funds legally
available for distribution shall be distributed ratably among the holders of
the Series A Preferred Stock in proportion to the full preferential amount
each such holder is otherwise entitled to receive.
Section 4. Conversion. The holders of the Series A Preferred Stock shall
have conversion rights as follows (the "Conversion Rights"):
(a) Right to Convert. Any outstanding shares of Series A Preferred Stock
may be converted by the holder thereof into fully paid and nonassessable
shares of the Corporation's Common Stock in the manner hereinafter provided.
(b) Automatic Conversion. In the event of any consolidation or merger of
the Corporation with or into an unaffiliated corporation or other entity or the
conveyance of all or substantially all of the assets of the Corporation to an
unaffiliated corporation or other entity (other than any merger or sale which
does not result in any reclassification or change in the relative right or
preference of the outstanding shares), the Series A Preferred Stock shall
automatically be converted into Common Stock immediately prior to the
consummation of any such transaction at the Conversion Ratio then in effect and
the holders thereof shall thereafter be entitled to receive a pro rata portion
of the shares of capital stock or other securities or property that is delivered
upon consummation of such transaction to holders of shares of Common Stock.
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(c) Conversion Ratio. Each share of the Series A Preferred Stock shall
be convertible at any time and from time to time in whole or in part into one
(1) share of the Corporation's Common Stock (the "Conversion Ratio");
provided, however, (i) in the event that, at any time and from time to time,
the Corporation shall issue additional shares of Common Stock (or securities
convertible into or exchangeable for Common Stock) in a stock dividend, stock
distribution, or subdivision paid with respect to Common Stock, or declare any
dividend or other distribution payable with additional shares of Common Stock
(or securities convertible into or exchangeable for Common Stock) with respect
to Common Stock or effect a split or subdivision of the outstanding shares of
Common Stock, the Conversion Ratio shall, concurrently with the effectiveness
of such stock dividend, stock distribution, or subdivision, or the earlier
declaration thereof, be proportionately increased, and the number of shares of
Common Stock issuable upon conversion of the Series A Preferred Stock shall be
proportionately adjusted so that, to avoid dilution of each holder's position,
each holder shall thereafter be entitled to receive an additional number of
shares of the Corporation's Common Stock which such holder would have owned or
would have been entitled to receive upon or by reason of any of the events
described above, had the Series A Preferred Stock been converted immediately
prior to the occurrence of such event; (ii) in the event the outstanding
shares of Common Stock shall be combined or consolidated, by reclassification
or otherwise, into a
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lesser number of shares of Common Stock, the Conversion Ratio shall,
concurrently with the effectiveness of such combination or consolidation, be
proportionately decreased and the number of shares of Common Stock issuable upon
conversion of the Series A Preferred Stock shall be proportionately adjusted so
that each holder of any Series A Preferred Stock converted after such date shall
be entitled to receive the aggregate number of shares of Common Stock which each
holder would have owned upon such conversion and been entitled to receive, if
such Series A Preferred Stock had been converted immediately prior to the
occurrence of such combination or consolidation; and (iii) in the event of any
consolidation or merger of the Corporation with or into an affiliated
corporation or other entity or the conveyance of all or substantially all of the
assets of the Corporation to an affiliated corporation or other entity (other
than any merger or sale which does not result in any reclassification or change
in the relative right or preference of the outstanding shares), the Series A
Preferred Stock shall thereafter be convertible into the number of shares of
capital stock or other securities or property that would have been deliverable
to such holder at the time of such consolidation, merger or conveyance, if such
holder had converted the Series A Preferred Stock immediately prior to such
consolidation, merger, or conveyance; and, in any such case, appropriate
adjustment shall be made in the application of the provisions herein set forth
with respect to the rights and interests of each holder of Series A Preferred
Stock thereafter, to the end that the provisions set forth herein (including
provisions with
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respect to adjustments in the Conversion Ratio) shall thereafter be applicable,
as nearly as may be possible, in relation to any shares of stock or other
property thereafter deliverable upon the conversion of Series A Preferred Stock.
At the request of any holder of Series A Preferred Stock, the resulting or
surviving entity in any such consolidation or merger, if other than the
Corporation, shall acknowledge in writing such holder's rights hereunder.
(d) Mechanics of Conversion. The right of the holders of the Series A
Preferred Stock to convert their shares shall be exercised by transmitting to
the Corporation or its agent, a notice of such conversion together with
certificates representing shares of the Series A Preferred Stock to be
converted, duly endorsed in blank. If the shares issuable upon conversion are
to be issued in a name other than the name in which the shares of Series A
Preferred Stock to be converted are then registered, such notice and the
certificates representing shares of the Series A Preferred Stock to be
converted shall be accompanied by such evidence of payment transfer taxes and
such proper instruments of transfer as may be reasonably requested by the
Corporation. The Corporation shall promptly after receipt of the foregoing
issue to the holder of the Series A Preferred Stock the appropriate number of
shares of the Corporation's Common Stock. The Series A Preferred Stock shall
be convertible on the basis of the first Series A Preferred Stock received by
the Corporation for conversion.
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(e) No Impairment. The Corporation shall not, by amendment of its
Articles of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms to be observed or performed hereunder by the Corporation but will
at all times in good faith assist in the carrying out of all the provisions of
this Section 4 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 the
Series A Preferred Stock against impairment.
(f) Certificate as to Adjustments. Upon the occurrence of each adjustment
to the Conversion Ratio pursuant to this Section 4, the Corporation, at its
expense, shall promptly compute such adjustment in accordance with the terms
hereof and furnish to each holder of the Series A Preferred Stock a certificate
setting forth such adjustment and showing in detail the facts upon which such
adjustment is based. The Corporation shall, upon the written request at any time
of any holder of Series A Preferred Stock, furnish or cause to be furnished to
such holder a like certificate setting forth (i) such adjustments, (ii) the
Conversion Ratio at the time in effect, and (iii) the number of shares of Common
Stock and the amount, if any, of other property which at the time would be
received upon the conversion of the Series A Preferred Stock.
(g) Common Stock Reserved. The Corporation shall reserve and keep
available out of its authorized but unissued Common Stock such number of
shares of Common Stock as shall from time to time be sufficient to effect the
conversion of the Series A Preferred Stock.
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(h) Common Stock Listing. Prior to delivery of any securities which the
Corporation is obligated to deliver upon payment of any dividend, upon any
liquidation, dissolution, or winding up of the Corporation, or upon conversion
of the Series A Preferred Stock, the Corporation shall use all reasonable
efforts to list such securities on any exchange or inter-dealer quotation
system on which such securities are principally traded or authorized to be
quoted.
(i) Transfer Taxes. The Corporation shall pay all documentary stamp or
similar issue or transfer taxes payable with respect to the issue or delivery
of shares of Common Stock upon conversion of the Series A Preferred Stock
pursuant hereto, provided that such shares of Common Stock are issued int he
name of the then registered holder of the Series A Preferred Stock to be
converted.
(j) Notice of Record Dates. The Corporation shall mail to the holders of
shares of series A Preferred Stock at their addresses as shown on the stock
records of the Corporation, as promptly as possible, but in any event not
fewer than 15 days prior to the applicable recorded date, a notice stating (i)
the date on which any merger, consolidation, recapitalization, or
reorganization of the Corporation, or sale of all or substantially all of the
Corporation's assets, or any other similar transaction or any corporate
transaction requiring the vote of the stockholders of the Corporation, (ii)
the record date therefor, and (iii) the consideration (by class and series) to
be paid to holders of capital stock of the Corporation upon consummation
thereof.
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Section 5. Voting Rights. Except as otherwise required by law, the
holders of the Series A Preferred Stock shall have voting rights equal to
those of the Common Stock into which the Series A Preferred Stock are
convertible and shall vote together with the holders of Common Stock as a
single class on all matters submitted to the stockholders for a vote.
Section 6. Covenants. So long as any of the Series A Preferred Stock shall
be outstanding (as adjusted for all subdivisions and combinations), the
Corporation shall not, without first obtaining the affirmative vote or written
consent of not less than fifty-one percent (51%) of such outstanding shares of
Series A Preferred Stock:
(a) amend or repeal, whether by merger, consolidation, or otherwise, any
provision of, or add any provision to, the Corporation's Certificate of
Incorporation or By-Laws if such action would alter or change the preferences,
rights, privileges or powers of, or the restrictions provided for the benefit
of the Series A Preferred Stock, or the number of authorized shares of Series
A Preferred Stock; or
(b) reclassify any Common Stock into shares having any preference or
priority as to dividends or assets superior to or on a parity with such
preference or priority of the Series A Preferred Stock.
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Section 7. Residual Rights. All rights accruing to the outstanding shares
of the Corporation not expressly provided for to the contrary herein shall be
vested in the Common Stock.
Section 8. Preemptive Rights. The holders of the Series A Preferred Stock
are not entitled to any preemptive rights.
IN WITNESS WHEREOF, This Certificate has been signed by the Chief
Executive Officer of Take-Two Interactive Software, Inc., and attested by its
Assistant Secretary this 11th day of March, 1998.
TAKE-TWO INTERACTIVE SOFTWARE, INC.
By: /s/ Ryan A. Brant
________________________________________
RYAN BRANT, Chief Executive Officer
[Seal]
ATTEST:
By: /s/ Jennifer Kolbe
________________________________________
JENNIFER KOLBE, Assistant Secretary
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