<PAGE> 1
Schedule 14C
(Rule 14c-101)
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the
Securities Exchange Act of 1934
Check the appropriate box:
[ ] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
[X] Definitive Information Statement
TRAVELOCITY.COM INC.
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(Name of Registrant As Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14c-5(g) and
0-11.
1) Title of each class of securities to which transaction applies:
N/A
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2) Aggregate number of securities to which transaction applies:
N/A
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
N/A
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4) Proposed maximum aggregate value of transaction:
N/A
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5) Total fee paid:
N/A
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
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TRAVELOCITY.COM INC.
4200 Buckingham Boulevard
Fort Worth, Texas 76155
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NOTICE OF ACTION BY WRITTEN CONSENT OF STOCKHOLDERS
AUGUST 7, 2000
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To the Stockholders of Travelocity.com Inc.:
NOTICE IS HEREBY GIVEN that on July 19, 2000 the Board of Directors of
Travelocity.com Inc., a Delaware corporation (the "Company" or
"Travelocity.com"), recommended an amendment and restatement of the Company's
Restated Certificate of Incorporation (the "Second Restatement") to redesignate
the Company's Series A Preferred Stock, par value $.001 per share ("Series A
Preferred Stock") as Class A Common Stock, par value $.001 per share (the "Class
A Common Stock"). No other changes to the terms of the Series A Preferred Stock
will be made. The holders of a majority of the outstanding shares of the
Company's Common Stock, par value $.001 per share (the "Common Stock") and
Series A Preferred Stock, voting as one class, executed a written stockholder
consent on July 19, 2000 approving the Second Restatement, which consent shall
become effective twenty (20) days after the mailing of this Information
Statement.
This Information Statement is being furnished to stockholders solely to
provide them with certain information concerning the Second Restatement in
accordance with the requirements of the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder, including Regulation 14C,
and Section 228 of the Delaware General Corporation Law. Your consent is not
required and is not being solicited in connection with this action.
The Second Restatement will become effective upon the filing of the
Second Restatement with the Secretary of State of the State of Delaware on or
about August 28, 2000 (the "Effective Date"). The Second Restatement is set
forth in Appendix A to this Information Statement.
The Information Statement is to be mailed on or about August 7, 2000,
to the Company's stockholders as of July 19, 2000 (the "Record Date"). At the
close of business on the Record Date, there were issued and outstanding,
16,346,377 shares of Common Stock, and 33,000,000 shares of Series A Preferred
Stock.
WE ARE NOT ASKING YOU FOR A PROXY,
AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
BY ORDER OF THE BOARD OF DIRECTORS OF
TRAVELOCITY.COM INC.
By: /s/ TERRELL B. JONES
--------------------------
Terrell B. Jones
President and Chief Executive
Officer
August 7, 2000
<PAGE> 3
TRAVELOCITY.COM INC.
4200 Buckingham Boulevard
Fort Worth, Texas 76155
INFORMATION STATEMENT
INTRODUCTION
This Information Statement is being first mailed on or about August 7,
2000 (the "Mailing Date") to the stockholders of record of Travelocity.com Inc.
("Travelocity.com" or "the Company"), a Delaware corporation, as of July 19,
2000 (the "Record Date"). Under applicable federal securities laws, the
amendment and restatement of the Company's Restated Certificate of Incorporation
(the "Second Restatement") cannot be effected until at least 20 calendar days
after this Information Statement is sent or given to the stockholders of the
Company.
Section 228 of the General Corporation Law of the State of Delaware
states that, unless otherwise provided in a corporation's Certificate of
Incorporation, any action that may be taken at any special meeting of
stockholders, may be taken without a meeting, without prior written notice and
without a vote, if consents in writing, setting forth the action so taken, are
signed by the holders of outstanding stock having not less than the minimum
number of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted, and
those consents are delivered to the corporation. The Board of Directors fixed
the close of business on July 19, 2000 as the record date for the determination
of holders of record of Common Stock, par value $.001 (the "Common Stock), and
holders of Series A Preferred Stock, par value $.001 (the "Series A Preferred
Stock") entitled to receive notice of the corporate action to be taken by
written consent. As of the Record Date, there were approximately 33,000,000
outstanding shares of Series A Preferred Stock and one holder of record of
Series A Preferred Stock and approximately 16,346,377 outstanding shares of
Common Stock and 9,790 holders of record of Common Stock. The approval of the
Second Restatement requires the written consent of the holders of a majority of
the outstanding shares of Series A Preferred Stock and Common Stock voting as a
single class with each share of Series A Preferred Stock and each share of
Common Stock entitled to one vote per share. By written consent in lieu of a
meeting, a majority of the outstanding shares of Common Stock and Series A
Preferred Stock, voting as a single class, have approved the Second Restatement.
WE ARE NOT ASKING YOU FOR A PROXY OR CONSENT AND YOU ARE REQUESTED
NOT TO SEND US A PROXY OR CONSENT.
AMENDMENT AND RESTATEMENT OF THE RESTATED CERTIFICATE OF INCORPORATION
On July 19, 2000, the Board of Directors of the Company recommended the
Second Restatement to redesignate the Company's Series A Preferred Stock, as
Class A Common Stock. No other changes to the terms of the Series A Preferred
Stock will be made. The Second Restatement in the form of Restated Certificate
of Incorporation is set forth in Appendix A to this Information Statement. The
Company has received the written consents executed by Travelocity
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Holdings, Inc., a wholly-owned subsidiary of Sabre, Inc., and Sabre, Inc., the
holders of a majority of the outstanding shares of Common Stock and Series A
Preferred Stock, approving and adopting the Second Restatement. The Second
Restatement shall become effective upon the filing of the Second Restatement
with the Secretary of State of the State of Delaware on or about August 28, 2000
(the "Effective Date").
PURPOSE OF THE REDESIGNATION OF THE SERIES A PREFERRED STOCK
The Second Restatement redesignates the Company's Series A Preferred Stock
as Class A Common Stock and will not alter any of the powers, designations,
preferences, qualifications, limitations or restrictions of the Series A
Preferred Stock. The Company has outstanding approximately 33,000,000 shares of
Series A Preferred Stock beneficially owned by Sabre, Inc. and 16,346,377 shares
of Common Stock held by various stockholders. The Company's current market
capitalization, as reported by the financial services media, reflects only
outstanding shares of Common Stock. As a result, the shares of Series A
Preferred Stock are not being reported in the Company's market capitalization.
Accordingly, the Company is redesignating its Series A Preferred Stock so that
the reported market capitalization will, if updated by the financial services
media, accurately reflect the underlying value of Travelocity.com's business.
EFFECT OF THE REDESIGNATION OF THE SERIES A PREFERRED STOCK
After the Second Restatement becomes effective, the Series A Preferred
Stock will be redesignated as Class A Common Stock. This change does not affect
the relative rights or privileges of holders of any class of outstanding capital
stock of the Company.
EFFECTIVENESS OF THE SECOND RESTATEMENT
The Company reserves the right, upon notice to stockholders, to abandon or
modify the Second Restatement at any time prior to the filing of the Second
Restatement with the Secretary of State of the State of Delaware, on or about
August 28, 2000.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of outstanding shares of the Company's voting stock as of
July 10, 2000 with respect to (i) each person known to the Company to own
beneficially more than 5% of the outstanding shares of the Company's voting
stock, (ii) each of Travelocity.com's directors, (iii) each of Travelocity.com's
named executive officers, and (iv) all the Company's directors and executive
officers as a group.
<TABLE>
<CAPTION>
CLASS OF SHARES OF STOCK
BENEFICIAL OWNERS STOCK OWNED PERCENT OF CLASS
----------------- ----------- ---------------- ----------------
<S> <C> <C> <C>
Travelocity Holdings, Inc. Preferred 33,000,000 (1) 100.0%
4255 Amon Carter Boulevard Stock
MD 4224
Fort Worth, Texas 76155
Sabre, Inc. Common Stock 1,176,470 (2) 7.2%
4255 Amon Carter Boulevard
Fort Worth, Texas 76155 Preferred
Stock 33,000,000 (1) 100.0%
Sabre Holdings Corporation Common Stock 1,176,470 (2) 7.2%
4255 Amon Carter Boulevard
Fort Worth, Texas 76155 Preferred
Stock 33,000,000 (1) 100.0%
FMR Corp. Common Stock 2,102,030 (3) 12.9%
82 Devonshire Street
Boston, Massachusetts 02109
Fidelity International Limited Common Stock 2,102,030 (3) 12.9%
Pembroke Hall
42 Crowlane
Hamilton, Bermuda
Michael A. Buckman (Director) (4)
F. William Conner (Director) (4)
Paul C. Ely (Director) (4)
William J. Hannigan (Director)
</TABLE>
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<TABLE>
<S> <C> <C> <C>
James J. Hornthal (Director) Common Stock 1,122,257 (5) 6.8%
Jeffery M. Jackson (Director)
Terrell B. Jones (Officer and Director) Common Stock 12,647 (6) *
Glenn W. Marschel, Jr. (Director) (4)
James D. Marsicano (Officer) Common Stock 4,246 (7) *
Ramesh K. Punwani (Officer) (8)
Andrew B. Steinberg (Officer) (9)
All directors and executive officers Common Stock 1,139,150 6.9%
as a group (11 persons)
</TABLE>
----------
* Less than 1%.
(1) Travelocity Holdings, Inc., a wholly-owned subsidiary of Sabre, Inc.,
holds 33,000,000 shares of the Company's Series A Preferred Stock,
which together with 30,000,000 units of Travelocity.com LP, owned by
Travelocity Holdings, Inc., Sabre, Inc., and TSGL Holding, a
wholly-owned subsidiary of Sabre Inc., are convertible into 33,000,000
shares of the Company's Common Stock. If Sabre Inc. and its
wholly-owned subsidiaries exercised their right to convert all their
partnership units and Series A Preferred Stock into Common Stock,
Sabre, Inc. would own approximately 70% of the Common Stock. Sabre,
Inc. is a beneficial owner of the Series A Preferred Stock based on
100% ownership of Travelocity Holdings, Inc. Sabre Holdings Corporation
is a beneficial owner of these shares based on 100% ownership of Sabre,
Inc.
(2) Amounts consist of shares owned by Sabre, Inc. Sabre Holdings
Corporation is a beneficial owner of these shares based on 100%
ownership of Sabre, Inc.
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(3) Based on Schedule 13G filed on March 14, 2000 by FMR Corp., Abigail P.
Johnson and Edward C. Johnson 3d and the Schedule 13G filed on March
14, 2000 by Fidelity International Limited, Abigail P. Johnson and
Edward C. Johnson 3d: FMR Corp. had sole voting power over 106,840
shares, sole dispositive power over 1,928,310 shares and beneficial
ownership of 2,102,030 shares of Common Stock. Fidelity Management &
Research Company, a wholly-owned subsidiary of FMR Corp. and an
investment adviser registered under Section 203 of the Investment
Advisers Act of 1940 ("Fidelity"), is the beneficial owner of 1,764,900
shares of the Common Stock as a result of acting as investment adviser
to various investment companies registered under Section 8 of the
Investment Company Act of 1940. Mr. Johnson, FMR Corp., through its
control of Fidelity, and the Fidelity funds each has sole dispositive
power over 1,764,900 shares owned by the Fidelity funds. Fidelity
Management Trust Company, a wholly-owned subsidiary of FMR Corp. and a
bank as defined in Section 3(a)(6) of the Securities Exchange Act of
1934 ("Fidelity Trust"), is the beneficial owner of 163,410 shares of
the Common Stock as a result of its serving as investment manager of
the institutional account(s). Mr. Johnson and FMR Corp., through its
control of Fidelity Trust, each has sole dispositive power over 163,410
shares, and sole power to vote or direct the voting of 106,840 shares
of Common Stock owned by the institutional accounts.
Strategic Advisers, Inc., a wholly-owned subsidiary of FMR Corp. and an
investment adviser registered under Section 203 of the Investment
Advisers Act of 1940, provides investment advisory services to
individuals. It does not have sole power to vote or direct the voting
of shares of certain securities held for clients and has sole
dispositive power over such securities. As such, FMR Corp.'s beneficial
ownership may include shares beneficially owned through Strategic
Advisers, Inc.
Members of the Edward C. Johnson 3d family are the predominant owners
of Class B shares of common stock of FMR Corp., representing
approximately 49% of the voting power of FMR Corp. Mr. Johnson 3d owns
12.0% and Abigail Johnson owns 24.5% of the aggregate outstanding
voting stock of FMR Corp. Mr. Johnson 3d is Chairman of FMR Corp. and
Abigail P. Johnson is Director of FMR Corp. The Johnson family group
and all other Class B shareholders have entered into a shareholders'
voting agreement under which all Class B shares will be voted in
accordance with the majority vote of Class B shares. Accordingly,
through their ownership of voting common stock and the execution of the
shareholders' voting agreement, members of the Johnson family may be
deemed, under the Investment Company Act of 1940, to form a controlling
group with respect to FMR Corp.
Fidelity International Limited and various foreign-based subsidiaries
provide investment advisory and management services to a number of
non-U.S. investment companies and certain institutional investors.
Fidelity International Limited is the beneficial owner of 173,720
shares of the Common Stock.
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(4) Holds options to purchase 20,000 shares of Common Stock granted under
the 1999 Travelocity.com LP Long-Term Incentive Plan. The stock options
will vest during the period from March 2001 through March 2004.
(5) Amount consists of 910,615 shares of Common Stock held beneficially by
Mr. Hornthal, 544 shares of Common Stock acquired pursuant to the
Travelocity.com LP Employee Stock Purchase Plan and options to purchase
211,098 shares of the Common Stock, which were options to purchase
shares of Preview Travel, Inc. common stock that were converted
pursuant to the merger of Preview Travel, Inc. with and into the
Company. Stock options representing 193,725 shares are now exercisable
and stock options representing 17,373 shares will vest in the next
sixty days. Mr. Hornthal also holds stock options representing 48,902
shares, which will vest thereafter through March 2001.
(6) Amount consists of options to purchase 12,647 shares of the Company's
Common Stock, which are vested. Mr. Jones holds, in the aggregate,
options to purchase 92,360 shares of the Company's Common Stock, which
were previously options to purchase shares of Sabre, Inc. Class A
Common Stock that were converted in connection with the merger of
Preview Travel, Inc. with and into the Company, and stock options for
750,000 shares granted under the Travelocity Holdings, Inc. 1999
Long-Term Incentive Plan. The remaining stock options will vest during
the period from October 2000 through April 2004.
(7) Amount consists of options to purchase 4,246 shares of the Company's
Common Stock, which are vested. Mr. Marsicano holds, in the aggregate,
options to purchase 15,070 shares of the Company's Common Stock, which
were previously options to purchase shares of Sabre Holdings
Corporation Class A Common Stock that were converted in connection with
the merger of Preview Travel, Inc. with and into the Company, and stock
options for 75,000 and 33,000 shares of the Company's Common Stock
granted under the Travelocity Holdings, Inc. 1999 Long-Term Incentive
Plan. The remaining stock options will vest during the period from
October 2000 through March 2004.
(8) Holds options to purchase 50,000 shares of Common Stock granted under
the Travelocity Holdings, Inc. 1999 Long-Term Incentive Plan. The stock
options will vest during the period from March 2001 through March 2004.
(9) Holds options to purchase 134,374 shares of the Company's Common Stock,
which were previously options to purchase shares of Sabre Holdings
Corporation Class A Common Stock that were converted in connection with
the merger of Preview Travel, Inc. with and into the Company, and
options to purchase 30,000 shares of the Company's Common Stock granted
under the Travelocity Holdings, Inc. 1999 Long-Term Incentive Plan. The
stock options will vest during the period from October 2000 through
March 2004.
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AVAILABLE INFORMATION
The Company is subject to the informational reporting requirements of the
Securities and Exchange Act of 1934, as amended. Thus, the Company files annual
and quarterly reports, proxy statements, and other information with the
Securities and Exchange Commission (the "SEC"). You may read, inspect and copy
any documents filed by the Company with the SEC at the SEC's public reference
facilities, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 or in the
SEC's Regional Offices at Seven World Trade Center, 13th Floor, New York, New
York 10048; and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Copies of the Company's filings can be obtained at
prescribed rates from the Public Reference Section of the SEC at 450 Fifth
Street, N.W., Washington, DC 20549. The Company's SEC filings are also available
to the public from the SEC's Website at "http://www.sec.gov."
TRAVELOCITY.COM INC.
August 7, 2000 By: /s/ TERRELL B. JONES
----------------------------
Terrell B. Jones
President and Chief Executive Officer
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<PAGE> 10
APPENDIX A
RESTATED CERTIFICATE OF INCORPORATION
OF
TRAVELOCITY.COM INC.
Travelocity.com Inc., a Delaware corporation, the original certificate of
incorporation of which was filed with the Secretary of State of the State of
Delaware on September 30, 1999 under the name Travelocity.com Inc., hereby
certifies that this Restated Certificate of Incorporation, restating,
integrating and amending its Restated Certificate of Incorporation filed with
the Secretary of State of the State of Delaware on March 7, 2000, was duly
adopted by its Board of Directors and its stockholders in accordance with
Sections 228, 242 and 245 of the Delaware General Corporation Law (the "DGCL").
The Certificate of Incorporation of Travelocity.com Inc., is hereby amended and
restated in its entirety to read as follows:
ARTICLE ONE
NAME
The name of the corporation is Travelocity.com Inc. (the "Corporation").
ARTICLE TWO
REGISTERED AGENT
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, Delaware 19801. The name of its registered agent at such
address is The Corporation Trust Company.
ARTICLE THREE
PURPOSE
The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the DGCL.
ARTICLE FOUR
CAPITAL STOCK
The total number of shares of all classes of capital stock which the
Corporation shall have the authority to issue is 250,000,000 shares divided into
four classes of which 7,000,000 shares, of par value $.001 per share shall be
designated preferred stock ("Preferred Stock"), 135,000,000 shares of par value
$.001 per share shall be designated Common Stock ("Common Stock"), 33,000,000
shares of par value $.001 per share shall be designated Class A Common Stock
(the "Class A Common Stock"), and 75,000,000 shares of par value $.001 per share
shall be designated Class B Common Stock (the "Class B Common Stock").
<PAGE> 11
A. PREFERRED STOCK
1. Issuance. The Board of Directors is authorized, subject to
limitations prescribed by law, to provide for the issuance of shares of
Preferred Stock in one or more series, to establish the number of shares to be
included in each such series, and to fix the designations, powers, preferences,
and rights of the shares of each such series, and any qualifications,
limitations, or restrictions thereof.
B. CLASS A COMMON STOCK
1. Ranking. (a) Any class or series of stock of the Corporation shall
be deemed to rank:
(i) prior to the Class A Common Stock, either as to the
payment of dividends or other amounts and/or as to distribution of
assets upon liquidation, dissolution or winding up, if the holders of
such class or series shall be entitled by the terms thereof to the
receipt of dividends or other amounts and/or of amounts distributable
upon liquidation, dissolution or winding up, in preference or priority
to the holders of Class A Common Stock ("Senior Securities");
(ii) on a parity with the Class A Common Stock, either as to
the payment of dividends or other amounts and/or as to distribution of
assets upon liquidation, dissolution or winding up, whether or not the
dividend rates, dividend payment dates or redemption or liquidation
prices per share thereof are different from those of the Class A
Common Stock, if the holders of the Class A Common Stock and of such
class of stock or series shall be entitled by the terms thereof to the
receipt of dividends or other amounts and/or of amounts distributable
upon liquidation, dissolution or winding up, in proportion to their
respective amounts of accrued and unpaid dividends per share and/or
liquidation preferences, without preference or priority one over the
other and such class of stock or series is not a class of Senior
Securities ("Parity Securities"); and
(iii) junior to the Class A Common Stock, either as to the
payment of dividends or other amounts and/or as to the distribution of
assets upon liquidation, dissolution or winding up, if the holders of
the Class A Common Stock shall be entitled by the terms thereof to
receipt of dividends or other amounts, and/or of amounts distributable
upon liquidation, dissolution or winding up, in preference or priority
to the holders of shares of such stock or series ("Junior
Securities").
(b) The respective definitions of Senior Securities, Junior
Securities and Parity Securities shall also include any rights or options
exercisable or exchangeable for or convertible into any of the Senior
Securities, Junior Securities and Parity Securities, as the case may be.
(c) The Class A Common Stock shall be subject to the creation of
Senior Securities, Junior Securities and Parity Securities and such creation
shall not be deemed to affect adversely the powers, preferences or special
rights of the shares of Class A Common Stock.
2. Dividends. If dividends or other distributions are payable on
shares of Common Stock, the Board of Directors shall simultaneously declare a
dividend or distribution on the shares of Class A Common Stock so that the
shares of Class A Common Stock shall receive the dividend or
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distribution that would be payable to them assuming all outstanding shares of
Class A Common Stock had been converted into shares of Common Stock pursuant to
Paragraph B(5) of this Article Four immediately prior to the record date for
such dividend or distribution; provided that if the dividend or distribution is
payable in the form of voting securities of the Corporation (or rights in
respect of voting securities of the Corporation) and such dividend or
distribution would result in a reduction of the relative voting power of the
holders of the shares of Class A Common Stock, the Board of Directors shall
declare at that time a dividend or distribution payable in shares of Class A
Common Stock, or in rights in respect of Class A Common Stock, or make such
other adjustment, as may be necessary, to maintain the relative voting power of
the holders of the shares of Class A Common Stock and Common Stock,
respectively, in effect immediately prior to the record date of the dividend or
distribution payable on shares of Common Stock; provided further that the intent
of this Paragraph B(2) is to ensure that (i) if the dividend or distribution
payable on shares of Common Stock confers an economic benefit on the holders of
shares of Common Stock, pursuant to this Paragraph B(2), the holders of shares
of Class A Common Stock shall receive their proportionate share of that benefit
assuming all outstanding shares of Class A Common Stock had been converted into
shares of Common Stock pursuant to Paragraph B(5) of this Article Four
immediately prior to the record date for such dividend or distribution and (ii)
following such dividend or distribution, the holders of shares of Class A Common
Stock shall maintain the same relative voting power as in effect immediately
prior to the record date of the dividend or distribution payable on shares of
Common Stock. Other than as provided in this Paragraph B(2) of this Article
Four, holders of shares of Class A Common Stock shall not be entitled to receive
any dividends or other distributions payable in cash, stock or other property.
3. Voting Rights. At every annual or special meeting of stockholders
of the Corporation, every holder of Class A Common Stock shall be entitled to
one vote for each share of Class A Common Stock standing in his name on the
books of the Corporation and shall vote together as a single class with the
holders of Common Stock and Class B Common Stock on all matters on which a vote
of stockholders is to be taken, except as otherwise required by law or by
Paragraph C(4) or Paragraph C(6)(a) of this Article Four.
4. Liquidation, Dissolution or Winding Up. In the event of any
voluntary or involuntary liquidation, dissolution or winding up of the affairs
of the Corporation (a "Liquidation"), after payment or provision for payment of
the debts and other liabilities of the Corporation and of any preferential
amounts to which the holders of any shares of any Senior Securities shall be
entitled, the holders of all outstanding shares of Class A Common Stock shall be
entitled to share ratably in the remaining net assets of the Corporation with
the holders of shares of Common Stock and Class B Common Stock, assuming all
outstanding shares of the Class A Common Stock had been converted into shares of
Common Stock pursuant to Paragraph B(5) of this Article Four immediately prior
to such Liquidation.
5. Conversion. (a) All outstanding shares of Class A Common Stock in
the aggregate as a series shall be convertible, at any time, at the option of
the holders of a majority of the shares of Class A Common Stock, into 3,000,000
shares of Common Stock (the fraction of 3,000,000 divided by the number of
outstanding shares of Class A Common Stock is referred to as the "Conversion
Ratio"); provided that in the event of any reclassification, subdivision,
combination, dividend or distribution, the Board of Directors of the Corporation
shall make such adjustment, as may be necessary, to the Conversion Ratio in
effect immediately prior to the effective date in the case of a
reclassification, subdivision or combination, or the record date in the case of
a dividend or distribution to maintain the relative aggregate ownership interest
of the Common Stock held by the holders of all outstanding shares of Class A
Common Stock (assuming all outstanding shares of the Class A Common Stock had
been
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converted into shares of Common Stock pursuant to this paragraph immediately
prior to the effective date in the case of a reclassification, subdivision,
combination, or the record date in the case of a dividend or distribution) and
by the other holders of the Common Stock, respectively, in effect immediately
prior to the effective date in the case of a reclassification, subdivision,
combination, or the record date in the case of a dividend or distribution. Such
adjustment shall be made successively whenever any reclassification,
subdivision, combination, dividend or distribution is made.
(b) The conversion of all outstanding shares of Class A Common
Stock into shares of Common Stock shall be effected by written notice to the
Secretary of the Corporation by the holders of a majority of the outstanding
shares of Class A Common Stock stating that such holders desire to convert all
outstanding shares of Class A Common Stock, as a series, into shares of Common
Stock (the "Conversion"). The Conversion shall be deemed to have been effected
as of the close of business on the date on which such notice has been received.
The Corporation will provide notice of the Conversion to all holders of record
of Class A Common Stock as soon as practicable following the Conversion. Such
notice shall be provided by mailing notice of such conversion first class
postage prepaid, to each holder of record of the Class A Common Stock at such
holder's address as it appears on the books of the Corporation; provided,
further, that no failure to give such notice nor any defect therein shall affect
the validity of the Conversion. Each such notice shall state, as appropriate,
the following: (i) the date of the Conversion; (ii) that all outstanding shares
of Class A Common Stock are automatically converted; (iii) the place or places
where certificates for such shares are to be surrendered for conversion; and
(iv) that no dividends will be declared on the shares of Class A Common Stock
converted after such conversion date.
(c) Immediately upon the Conversion, the rights of the holders of
shares of Class A Common Stock as such shall cease and such holders shall be
treated for all purposes as having become the record owners of the shares of
Common Stock issuable upon the Conversion; provided, however, that such Persons
shall be entitled to receive when paid dividends, if any, declared on the Class
A Common Stock as of a record date preceding the time of the Conversion and
unpaid as of the time of the Conversion, subject to paragraph (e) below.
(d) Promptly after the Conversion, the Corporation shall deliver
to the holders of issued and outstanding shares of Class A Common Stock, which
surrender for cancellation a certificate or certificates representing
outstanding shares of Class A Common Stock, a certificate or certificates
representing the number of shares of Common Stock issuable upon the Conversion
in the name of such holders. Until surrendered as provided herein, from and
after the Conversion, certificates representing outstanding shares of Class A
Common Stock prior to the Conversion shall thereupon be deemed for all corporate
purposes to evidence ownership of the number of shares of Common Stock into
which the Class A Common Stock shall have been converted by reason of the
Conversion.
(e) Upon the Conversion, any dividend, for which the record date
or payment date shall be subsequent to the Conversion, which may have been
declared on the shares of Class A Common Stock so converted shall be deemed to
have been declared, and shall be payable, with respect to the shares of Common
Stock into which such shares of Class A Common Stock shall have been so
converted.
(f) The Corporation shall at all times reserve and keep available
for issuance upon the Conversion free from any preemptive rights, such number of
its authorized but unissued shares of Common Stock as shall from time to time be
necessary to permit the Conversion, and shall take all action required to
increase the authorized number of shares of Common Stock if necessary to permit
the
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Conversion. The Corporation covenants that any shares of Common Stock issued
upon the Conversion shall be validly issued, fully paid and non-assessable.
(g) The issuance of certificates for shares of Common Stock upon
the Conversion shall be made without charge to the holders of such shares for
any issuance tax in respect thereof or other cost incurred by the Corporation in
connection with the Conversion and the related issuance of the shares of Common
Stock.
(h) When any shares of Class A Common Stock are acquired by the
Corporation, including without limitation, upon the Conversion, such shares may
not be reissued as Class A Common Stock and shall be retired and cancelled and
the Corporation shall take all such actions as are necessary to restore such
shares to the status of authorized but unissued shares of Preferred Stock,
without designation as to series.
6. Transferability. The shares of Class A Common Stock shall not be
transferable to any holder other than to an Affiliate of Travelocity Holdings,
Inc. ("Travelocity Holdings"); provided that transfers of shares of Class A
Common Stock to the Corporation or in connection with any merger, acquisition or
other business combination involving the Corporation and Travelocity Holdings or
any Affiliate of Travelocity Holdings shall be permitted.
7. Adjustments. If any event occurs as to which, in the opinion of the
Board of Directors, the provisions of Paragraph B(2) and B(5) of this Article
Four are not strictly applicable or if strictly applicable would not fairly
protect the rights of the holders of the shares of Class A Common Stock in
accordance with the essential intent and principles of such provisions, the
Board of Directors shall make an adjustment in the application of such
provisions, in accordance with such essential intent and principles, so as to
protect such rights of the holders of the shares of Class A Common Stock.
C. COMMON STOCK AND CLASS B COMMON STOCK
1. Powers and Preferences. The powers, preferences and rights and the
qualifications, limitations and restrictions with respect to the Common Stock
and the Class B Common Stock shall be identical in all respects, except as
provided in Paragraphs C(2) and C(4) of this Article Four, Paragraph D of
Article Five or as otherwise required by law.
2. Limitations on Ownership. The Class B Common Stock shall only be
issuable to Travelocity Holdings or any Affiliate of Travelocity Holdings and
only in connection with a Tax-Free Spin-Off.
3. Dividends. Subject to the preferential rights, if any, of any
outstanding shares of any Senior Securities, the holders of shares of Common
Stock and Class B Common Stock shall be entitled to receive, when and if
declared by the Board of Directors, out of the assets of the Corporation which
are by law available therefor, dividends or distributions payable either in
cash, in property, or in stock. If any dividend or other distribution in cash or
other property is paid with respect to Common Stock or with respect to Class B
Common Stock (other than dividends or other distributions payable in shares of
Common Stock or Class B Common Stock), a like dividend or other distribution in
cash or other property shall also be paid with respect to shares of the other
class of Common Stock, in an amount equal per share. In the case of dividends or
other distributions payable in Common Stock or Class B Common Stock, including
without limitation distributions pursuant to stock splits or divisions of Common
Stock or Class B Common Stock of the Corporation, only shares of Common Stock
shall be
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paid or distributed with respect to Common Stock, and only shares of Class B
Common Stock shall be paid or distributed with respect to Class B Common Stock.
The number of shares of Common Stock and Class B Common Stock so distributed
shall be equal in number on a per share basis.
4. Voting Rights. (a) At every annual or special meeting of
stockholders of the Corporation, every holder of shares of Common Stock and
Class B Common Stock shall be entitled to one vote for each share of Common
Stock or Class B Common Stock standing in his name on the books of the
Corporation, and shall vote together as a single class with the holders of the
shares of Class A Common Stock on all matters on which a vote of stockholders is
to be taken, except as otherwise required by law or by Paragraph C(4)(b) of this
Article Four or by Paragraph C(6)(a) of this Article Four.
(b) (i) Upon the issuance of shares of Class B Common Stock, the
holders of shares of Class B Common Stock shall have the right, voting
separately as a class, to elect such number of directors as shall constitute
eighty percent of the whole Board of Directors (and if eighty percent of such
number of directors is not a whole number, then the holders of shares of Class B
Common Stock, voting separately as a class, shall be entitled to elect the next
higher whole number of directors) and the remaining directors of the Corporation
shall be elected by the holders of shares of Common Stock and Class B Common
Stock voting together as a single class.
(ii) At the stockholders meeting held as provided in
Paragraph C(2) of Article Five, each holder of Class B Common Stock, present at
the meeting in person or by proxy, shall be entitled to cast that number of
votes on the removal of the directors then in office so that the holders of all
the shares of Class B Common Stock present at such meeting in person or by proxy
shall be entitled to cast a majority of the total votes entitled to be cast on
the removal of directors by the holders of the outstanding shares of capital
stock of the Corporation entitled to vote thereon.
5. Liquidation, Dissolution, or Winding Up. In the event of any
Liquidation, after payment or provision for payment of the debts and other
liabilities of the Corporation and of the preferential amounts, if any, to which
the holders of any Senior Securities shall be entitled, the holders of all
outstanding shares of Common Stock and Class B Common Stock with the holders of
all outstanding shares of Class A Common Stock (assuming all outstanding shares
of the Class A Common Stock had been converted into shares of Common Stock
pursuant to Paragraph B(5) of this Article Four immediately prior to such
Liquidation) shall be entitled to share ratably in the remaining net assets of
the Corporation.
6. Conversion of Class B Common Stock.
(a) In the event of a Tax-Free Spin-Off, each share of Class B
Common Stock shall automatically convert into one share of Common Stock on the
fifth anniversary of the date on which shares of Class B Common Stock are first
transferred to holders of Class A or B common stock of Sabre Holdings
Corporation, a Delaware corporation ("Sabre Parent"), in a Tax-Free Spin-Off
unless, prior to such Tax-Free Spin-Off, Sabre Parent delivers to the
Corporation an opinion of counsel, reasonably satisfactory to the Corporation,
to the effect that such conversion could adversely affect the ability of Sabre
Parent to obtain a favorable ruling from the Internal Revenue Service (the
"IRS") that the distribution would be a tax-free spin-off under Section 355 of
the Code. If such an opinion is received, approval of such conversion shall be
submitted to a vote of the holders of only the Common Stock and Class B Common
Stock as soon as practicable after the fifth anniversary of the Tax-Free
Spin-Off provided that Sabre Parent delivers to the Corporation an opinion of
counsel, reasonably satisfactory to the Corporation, to the effect that such
vote would not adversely affect the status of the Tax-Free Spin-Off
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(including without limitation the ability to obtain a favorable ruling from the
IRS); if such opinion is not so delivered at such time, such vote shall not be
held until such time as such opinion is delivered. At the meeting of
stockholders called for such purpose, each holder of Common Stock and Class B
Common Stock shall be entitled to one vote, in person or by proxy, for each
share of Common Stock or Class B Common Stock of the Corporation standing in his
name on the books of the Corporation. Approval of such conversion shall require
the approval of a majority of the votes, on the per share voting basis provided
in the preceding sentence, entitled to be cast by the holders of the Common
Stock and the Class B Common Stock present and voting, voting together as a
single class, and the holders of the Class B Common Stock shall not be entitled
to a separate class vote. Such conversion shall be effective on the date on
which such approval is given at a meeting of stockholders called for such
purpose.
(b) The Corporation will provide notice of any automatic
conversion of all outstanding shares of Class B Common Stock to all holders of
record of the Common Stock and Class B Common Stock as soon as practicable
following such conversion; provided, however, that the Corporation may satisfy
such notice requirement by providing such notice prior to such conversion. Such
notice shall be provided by mailing notice of such conversion first class
postage prepaid, to each holder of record of the Common Stock and Class B Common
Stock at such holder's address as it appears on the books of the Corporation;
provided, further, that no failure to give such notice nor any defect therein
shall affect the validity of the automatic conversion of any shares of Class B
Common Stock. Each such notice shall state, as appropriate, the following: (i)
the automatic conversion date; (ii) that all outstanding shares of Class B
Common Stock are automatically converted; (iii) the place or places where
certificates for such shares are to be surrendered for conversion; and (iv) that
no dividends will be declared on the shares of Class B Common Stock converted
after such conversion date.
(c) Immediately upon such conversion, the rights of the holders
of shares of Class B Common Stock as such shall cease and such holders shall be
treated for all purposes as having become the record owners of the shares of
Common Stock issuable upon such conversion; provided, however, that such Persons
shall be entitled to receive when paid dividends, if any, declared on the Class
B Common Stock as of a record date preceding the time of such conversion and
unpaid as of the time of such conversion, subject to paragraph (e) below.
(d) Holders of shares of Class B Common Stock may at any and all
times transfer to any Person the shares of Common Stock issuable upon conversion
of such shares of Class B Common Stock.
(e) Upon any conversion of shares of Class B Common Stock into
shares of Common Stock, any dividend for which the record date or payment date
shall be subsequent to such conversion, which may have been declared on the
shares of Class B Common Stock so converted, shall be deemed to have been
declared, and shall be payable, with respect to the shares of Common Stock into
which such shares of Class B Common Stock shall have been so converted.
(f) When any shares of Class B Common Stock are acquired by the
Corporation, including without limitation, upon conversion into shares of Common
Stock, such shares may not be reissued and shall be retired and cancelled and
the Corporation shall take all such actions as are necessary to cause the
authorized number of Class B Common Stock to be accordingly reduced.
(g) The Corporation shall at all time reserve and keep available,
for issuance upon the conversion of the shares of Class B Common Stock free from
any preemptive rights, such number of its authorized but unissued shares of
Common Stock as shall from time to time be necessary to
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permit the conversion of all outstanding shares of Class B Common Stock into
shares of Common Stock, and shall take all action required to increase the
authorized number of shares of Common Stock if necessary to permit the
conversion of all outstanding shares of Class B Common Stock. The Corporation
covenants that any shares of Common Stock issuable upon conversion of the shares
of Class B Common Stock shall be validly issued, fully paid and non-assessable.
(h) Promptly after the conversion, the Corporation shall deliver
to the holders of issued and outstanding shares of Class B Common Stock, which
surrender for cancellation, a certificate or certificates representing
outstanding shares of Class B Common Stock, a certificate or certificates
representing the number of shares of Common Stock issuable upon the conversion
of the Class B Common Stock into Common Stock in the name of such holders. Until
surrendered as provided herein, from and after the conversion of Class B Common
Stock into Common Stock, certificates representing outstanding shares of Class B
Common Stock prior to the conversion into Common Stock shall thereupon be deemed
for all corporate purposes to evidence ownership of the number of shares of
Common Stock into which the Class B Common Stock shall have been converted.
(i) The issuance of certificates for shares of Common Stock upon
the conversion of shares of Class B Common Stock into Common Stock shall be made
without charge to the holders of such shares for any issuance tax in respect
thereof or other costs incurred by the Corporation in connection with such
conversion and the related issuance of the shares of Common Stock.
D. NO PREEMPTIVE RIGHTS
No stockholder of the Corporation shall have any preemptive or
preferential right, nor be entitled as such as a matter of right, to subscribe
for or purchase any part of any new or additional issue of stock of the
Corporation of any class or series whether now or hereafter authorized, and
whether issued for money or for consideration other than money, or of any issue
of securities convertible into stock of the Corporation.
E. SUBDIVISION OR COMBINATION
If the Corporation shall in any manner subdivide or combine the
outstanding shares of Class A Common Stock, Common Stock or Class B Common
Stock, all outstanding shares of Class A Common Stock, Common Stock and Class B
Common Stock shall be proportionally subdivided or combined in the same manner
and on the same basis, and holders of shares of Class A Common Stock shall
receive only shares of Class A Common Stock, holders of shares of Common Stock
shall receive only shares of Common Stock and holders of shares of Class B
Common Stock shall receive only shares of Class B Common Stock in respect
thereof.
F. ADDITIONAL SHARES
Any increase in the authorized number of shares of any class or
classes of stock of the Corporation or creation, authorization or issuance of
any securities convertible into, or warrants, options or similar rights to
purchase, acquire or receive, shares of any such class or classes of stock shall
be deemed not to affect adversely the powers, preferences or special rights of
the shares of Class A Common Stock, Common Stock or Class B Common Stock.
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G. RECORD HOLDERS
The Corporation shall be entitled to treat the Person in whose name
any share of its stock is registered as the owner thereof for all purposes and
shall not be bound to recognize any equitable or other claim to, or interest in,
such share on the part of any other Person, whether or not the Corporation shall
have notice thereof, except as expressly provided by applicable law.
H. CUMULATIVE VOTING
No stockholder shall be entitled to the right of cumulative voting.
ARTICLE FIVE
BOARD OF DIRECTORS
A. NUMBER OF DIRECTORS AND COMPOSITION.
1. Number. Subject to the rights of the holders of any outstanding
shares of any series of Preferred Stock, the number of directors of the
Corporation shall be fixed by the By-laws of the Corporation and may be
increased or decreased from time to time in such a manner as may be prescribed
by the By-laws; provided that during such time as shares of Class B Common Stock
are outstanding, the Board of Directors shall consist of 15 members.
2. Independent Directors. Except for temporary periods resulting from
the death, resignation, retirement or removal from office of any Independent
Director, at least two directors of the Corporation shall be Persons who do not
have a material business relationship with Sabre or any of its Affiliates and
who are not employees, officers or directors of Sabre or any of its Affiliates
or any Person having a material business relationship with Sabre (for purposes
of this paragraph Travelocity.com LP and its Subsidiaries, or any Subsidiaries
of the Corporation, shall not be deemed an Affiliate of Sabre) (the "Independent
Directors").
B. WRITTEN BALLOT NOT REQUIRED
Elections of directors need not be by written ballot unless the
By-laws of the Corporation shall otherwise provide.
C. CLASSES
1. Initial Classes. The directors, other than those who may be elected
by the holders of any outstanding shares of any series of Preferred Stock, shall
be divided into three classes, as nearly equal in number as possible. One class
of directors shall be initially elected for a term expiring at the annual
meeting of stockholders to be held in 2001, another class shall be initially
elected for a term expiring at the annual meeting of stockholders to be held in
2002, and another class shall be initially elected for a term expiring at the
annual meeting of stockholders to be held in 2003. Members of each class shall
hold office until their successors are elected and qualified. At each annual
meeting of the stockholders of the Corporation, commencing with the 2001 annual
meeting, the successors of the class of directors whose term expires at that
meeting shall be elected by a plurality vote of all votes cast at such meeting
to hold office for a term expiring at the annual meeting of stockholders held in
the third year following the year of their election.
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2. Classes After Issuance of Class B Common Stock. After the issuance
of Class B Common Stock, the Secretary of the Corporation shall call a special
meeting of the stockholders for the removal of the incumbent directors and the
election of directors. The Corporation shall use its reasonable best efforts to
hold such meeting within sixty days after the issuance of the Class B Common
Stock and at such place and upon such notice as is provided by law and in the
Bylaws of the Corporation; provided, however, that the Secretary shall not be
required to call any such special meeting in the event the Class B Common Stock
is issued less than ninety days before the date fixed for the next ensuing
annual meeting of stockholders and provided further that no such special meeting
nor any adjournment thereof shall be held on a date less than thirty days before
any meeting of the stockholders called for the election of directors. At such
meeting or adjournment thereof, a vote on the removal of the directors then in
office shall be taken and an election for fifteen directors to the Board of
Directors of the Corporation in accordance with Paragraph C(4)(b) of Article
Four hereof shall be held. The directors shall be divided into three classes
with each class consisting of five directors. The holders of shares of Class B
Common Stock shall have the right to elect four (the "Class B Directors") of the
five directors in each class. One class of directors shall be initially elected
for a term expiring at the first annual meeting of stockholders to be held after
such special meeting, another class shall be initially elected for a term
expiring at the second annual meeting of stockholders to be held after such
special meeting, and another class shall be initially elected for a term
expiring at the third annual meeting of stockholders to be held after such
special meeting of stockholders. Members of each class shall hold office until
their successors are elected and qualified. The Class B Directors shall be
elected by a plurality vote of the votes cast by holders of Class B Common Stock
at such meeting and the remaining directors shall be elected by a plurality vote
of all votes cast at such meeting. At each annual meeting of the stockholders
commencing with the first annual meeting of stockholders to be held after such
special meeting, the successors of the class of directors whose term expires at
that meeting shall be elected to hold office for a term expiring at the annual
meeting of stockholders held in the third year following the year of their
election. After the shares of Class B Common Stock are no longer outstanding,
the Board of Directors may decrease the number of directors; provided that the
Board of Directors shall continue to be divided into three classes, as nearly
equal in number as possible and shall be elected by a plurality vote of all
votes cast at each annual meeting of stockholders.
D. REMOVAL
Subject to the rights of the holders of any outstanding shares of any
series of Preferred Stock, any director may be removed from office, at any time,
with or without cause, by the affirmative vote of the holders of at least a
majority of the voting power of the then outstanding Voting Stock, voting
together as a single class; provided, however, that after the Trigger Date, any
director may be removed from office, but only for cause, and only by the
affirmative vote of the holders of at least 80 percent of the voting power of
the then outstanding Voting Stock, voting together as a single class; provided,
further, that the Class B Directors may be removed from office, with or without
cause, at any time only by the holders of at least 80 percent of the voting
power of the then outstanding shares of Class B Common Stock.
E. BY-LAWS
1. Amendments. The Board of Directors is expressly authorized to
adopt, amend or repeal the By-laws of the Corporation. Any By-laws made by the
directors under the powers conferred hereby may be amended or repealed by the
directors or by the stockholders having voting power with respect thereto;
provided, that in the case of amendments by stockholders, effective as of the
Trigger
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Date, the affirmative vote of the holders of at least 80 percent of the voting
power of the then outstanding Voting Stock, voting together as a single class,
shall be required to alter, amend or repeal any provision of the By-laws or
adopt any provision of the By-laws inconsistent with any other provision of the
By-laws.
2. Powers. The Corporation may in its By-laws confer powers upon the
Board of Directors in addition to the foregoing and in addition to the powers
and authorities expressly conferred upon the Board of Directors by applicable
law.
3. Inspection. The Board of Directors is expressly authorized and
empowered from time to time to determine whether and to what extent, and at what
times and places, and under what conditions and regulations, the accounts and
books of the Corporation, or any of them, shall be open to inspection of
stockholders; and, except as so determined, or as expressly provided in this
Restated Certificate of Incorporation, and subject to the rights of the holders
of any outstanding shares of any series of Preferred Stock, no stockholder shall
have any right to inspect any account, book or document of the Corporation other
than such rights as may be conferred by applicable law.
ARTICLE SIX
CORPORATE OPPORTUNITIES
A. For purposes of this Article Six, (i) "Sabre" shall mean Sabre Parent,
all successors to Sabre Parent by way of merger, consolidation or sale of all or
substantially all its assets, and all corporations, partnerships, joint
ventures, associations and other entities (each a "Subsidiary Entity") in which
Sabre Parent Beneficially Owns, directly or indirectly, 50 percent or more of
the outstanding voting stock, voting power or similar voting interests ("Voting
Interest"), but shall not mean Travelocity Holdings, any Subsidiary of
Travelocity Holdings, or the Corporation; and (ii) "Corporation" shall mean the
Corporation and all corporations, partnerships, joint ventures, associations and
other entities in which the Corporation owns, directly or indirectly, securities
or other interests having by their terms the voting power to elect a majority of
the Board of Directors or others performing similar functions with respect to
such corporation, partnership, joint venture, association or other entity, and
shall also include Travelocity Holdings and any Subsidiary of Travelocity
Holdings.
B. In anticipation that: (i) Sabre will remain, for some period of time, a
Beneficial Owner of a substantial amount of Voting Stock of the Corporation;
(ii) the Corporation and Sabre may engage in the same or similar activities or
lines of business and may have an interest in the same or similar areas of
corporate opportunities; (iii) there will be benefits to be derived by the
Corporation through its continued contractual, corporate and business relations
with Sabre (including, without limitation, service of directors, officers and
employees of Sabre as directors, officers and employees of the Corporation); and
(iv) there will be benefits in providing guidelines for directors, officers and
employees of Sabre and of the Corporation with respect to the allocation of
corporate opportunities and other matters; the provisions of this Article Six
are set forth to regulate, define and guide the conduct of certain affairs of
the Corporation as they may involve the respective rights, duties and
liabilities of Sabre and its directors, officers, employees and stockholders, on
the one hand, and the respective rights, duties and liabilities of the
Corporation and its directors, officers, employees and stockholders (other than
Sabre), on the other hand, in connection therewith.
C. Except as Sabre may otherwise agree in writing, Sabre shall have the
right to, and shall have no duty not to, (i) engage in the same or similar
business activities or lines of business as the
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Corporation, (ii) do business with any potential or actual customer or supplier
of the Corporation, or (iii) employ or otherwise engage any director, officer or
employee of the Corporation. In the event Sabre or any director, officer or
employee of Sabre engages in any of the activities described in the preceding
sentence, Sabre and such director, officer and employee (i) shall have fully
satisfied and fulfilled any fiduciary duty it may have to the Corporation and
its stockholders with respect to such activity, (ii) shall not be liable to the
Corporation or its stockholders for breach of any fiduciary duty it may have by
reason of any activities of Sabre described in the preceding sentence or of the
participation in such activities of any director, officer or employee of Sabre
(except as provided in paragraph (D) of this Article Six), (iii) shall be deemed
to have acted in good faith and in a manner it reasonably believes to be in and
not opposed to the best interests of the Corporation, (iv) shall be deemed not
to have breached any duty of loyalty to the Corporation or its stockholders that
it may have and not to have derived an improper benefit therefrom, and (v) shall
be deemed to have acted in a manner entirely fair to the Corporation and its
stockholders.
D. In the event that a director, officer or employee of the Corporation who
is also a director, officer or employee of Sabre acquires knowledge of a
potential transaction or matter that may be a corporate opportunity for both the
Corporation and Sabre, such director, officer or employee of the Corporation (i)
shall have fully satisfied and fulfilled any fiduciary duty it may have to the
Corporation and its stockholders with respect to such corporate opportunity,
(ii) shall not be liable to the Corporation or its stockholders for breach of
any fiduciary duty it may have by reason of the fact that Sabre pursues or
acquires such corporate opportunity for itself or directs such corporate
opportunity to another Person or does not communicate information regarding such
corporate opportunity to the Corporation, (iii) shall be deemed to have acted in
good faith and in a manner it reasonably believes to be in and not opposed to
the best interests of the Corporation, (iv) shall be deemed not to have breached
any duty of loyalty to the Corporation or its stockholders that it may have and
not to have derived an improper benefit therefrom, and (v) shall be deemed to
have acted in a manner entirely fair to the Corporation and its stockholders, if
such director, officer or employee acts in a manner consistent with the
following policy:
(x) when a corporate opportunity is offered to an officer or employee
and/or director of the Corporation who is also an officer or employee
and/or director of Sabre, solely in his or her designated capacity with one
of the two companies, such corporate opportunity shall belong to whichever
company was so designated; otherwise, a corporate opportunity first offered
(1) to any Person who is an officer or employee or officer or employee and
director of the Corporation, and who is also a director of Sabre shall
belong to the Corporation, (2) to a Person who is a director of the
Corporation and who is also an officer or employee and/or director of Sabre
shall belong to Sabre, (3) to any Person who is an officer or employee, but
not a director, of both the Corporation and Sabre shall belong to the
company to which such Person has devoted a majority of his or her time over
the prior six-month period, (4) to any Person who is an officer or employee
and director of both the Corporation and Sabre shall belong to Sabre, (5)
to any Person who is an officer or employee of the Corporation and who is
also an officer or employee and director of Sabre shall belong to Sabre,
and (6) to any Person who is an officer or employee and director of the
Corporation and who is also an officer or employee of Sabre shall belong to
the Corporation, unless such Person serves as a director of Travelocity
Holdings but not of the Corporation (for purposes of this clause (6), the
Corporation shall be deemed to exclude Travelocity Holdings and "Sabre"
shall be deemed to include Travelocity Holdings), such corporate
opportunity shall belong to Sabre; and
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(y) in the case of any business opportunity not specifically allocated
by the foregoing (whether because of the means by which it arose or was
published, or otherwise), any such business opportunity may be pursued by
either the Corporation or Sabre.
However, a corporate opportunity not allocated and pursued in accordance
with the foregoing policy shall not solely by reason of the lack of allocation
and pursuit of the corporate opportunity in accordance with such policy be
deemed a breach of any fiduciary duty, but shall be governed by the other
provisions of this Article Six, this Restated Certificate of Incorporation, the
By-laws, the DGCL and other applicable law.
E. Any corporate opportunity that belongs to Sabre or to the Corporation
pursuant to the foregoing policy shall not be pursued by the other, or directed
by the other to another Person, unless and until Sabre or the Corporation, as
the case may be, determines not to pursue the opportunity and advises in writing
the chief executive officer of the other party that it has determined not to
pursue such corporate opportunity. Notwithstanding the preceding sentence, if
the party to whom the corporate opportunity belongs does not within a reasonable
period of time begin to pursue, or thereafter continue to pursue, such
opportunity diligently and in good faith, the other party may then pursue such
opportunity or direct it to another Person. Any business opportunity that
belongs to the Corporation pursuant to the foregoing policy shall be deemed to
belong to Travelocity.com Inc. and not to Travelocity Holdings or any Subsidiary
of Travelocity Holdings (other than Travelocity.com Inc. and its Subsidiaries).
F. For purposes of this Article Six, "corporate opportunities" shall
consist only of business opportunities which (i) the Corporation is financially
able to undertake, or with respect to which the Corporation would reasonably be
able to obtain debt or equity financing, and (ii) are, from their nature, in the
line or lines of the Corporation's business or reasonable expansion thereof. In
addition, "corporate opportunities" shall not include any contract, agreement,
arrangement, transaction, undertaking or business (a "Transaction") in which the
Corporation or Sabre is permitted to participate pursuant to (a) any agreement
between the Corporation and Sabre that is in effect as of the time any equity
security of the Corporation is held of record by any Person other than Sabre, as
such agreement may be amended thereafter with the approval of a majority of
disinterested directors or (b) any subsequent agreement between the Corporation
and Sabre approved in accordance with the procedures set forth in Article Seven
hereof; it being acknowledged that the rights of the Corporation under any such
agreement shall be deemed to be contractual rights and shall not be corporate
opportunities of the Corporation for any purpose; provided, however, that no
presumption or implication as to corporate opportunities relating to any
Transaction not explicitly covered by such an agreement shall arise from the
existence or absence of any such agreement.
G. Any Person purchasing or otherwise acquiring any interest in any shares
of stock of the Corporation shall be deemed to have notice of and consented to
the provisions of this Article Six.
H. If any Transaction between the Corporation and Sabre involves a
corporate opportunity and is approved in accordance with the procedures set
forth in Article Seven hereof, Sabre and its directors, officers and employees
shall also, for the purposes of this Article Six and the other provisions of
this Restated Certificate of Incorporation, be deemed to have fully satisfied
and fulfilled any fiduciary duties they may have to the Corporation and its
stockholders. Any such Transaction involving a corporate opportunity not so
approved shall not solely by reason of the lack of such approval be deemed a
breach of any fiduciary duty, but shall be governed by the other provisions of
this Article Six, this Restated Certificate of Incorporation, the By-laws, the
DGCL and other applicable law.
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ARTICLE SEVEN
RELATED TRANSACTIONS
A. For purposes of this Article Seven, (i) "Sabre" shall mean Sabre Parent,
all successors to Sabre Parent by way of merger, consolidation or sale of all or
substantially all its assets, and all Subsidiary Entities in which Sabre Parent
Beneficially Owns, directly or indirectly, 50 percent or more of the Voting
Interest, but shall not mean the Corporation; and (ii) "Corporation" shall mean
the Corporation, Travelocity.com L.P. and all corporations, partnerships, joint
ventures, associations and other entities in which the Corporation owns,
directly or indirectly, securities or other interests having by their terms the
voting power to elect a majority of the Board of Directors or others performing
similar functions with respect to such corporation, partnership, joint venture,
association or other entity.
B. In anticipation that: (i) Sabre Parent will remain, for some period of
time, a Beneficial Owner of a substantial amount of Voting Stock of the
Corporation and have continued contractual, corporate and business relations
with the Corporation; (ii) the Corporation and Sabre or Sabre's customers or
suppliers may enter into contracts or otherwise transact business with each
other and the Corporation may derive benefits therefrom; and (iii) the
Corporation may from time to time enter into contractual, corporate or business
relations with one or more of its directors, or one or more corporations,
partnerships, associations or other organizations in which one or more of its
directors have a financial interest (collectively, "Related Entities"), the
provisions of this Article Seven are set forth to regulate and guide certain
contractual relations and other business relations of the Corporation as they
may involve the respective rights, duties and liabilities of Sabre or its
customers or suppliers, Related Entities and their respective directors,
officers, employees, and stockholders, on the one hand, and the respective
rights, duties and liabilities of the Corporation and its directors, officers,
employees and stockholders, on the other hand, in connection therewith.
C. The provisions of this Article Seven are in addition to the provisions
of the DGCL and the other provisions of this Restated Certificate of
Incorporation. Any contract or business relation which does not comply with
procedures set forth in this Article Seven shall not by reason thereof be deemed
void or voidable or result in any breach of any fiduciary duty to, or duty of
loyalty to, or failure to act in good faith or in the best interests of, the
Corporation, or the derivation of any improper personal benefit, but shall be
governed by the remaining provisions of this Restated Certificate of
Incorporation, the By-laws, the DGCL and other applicable law.
D. No Transaction between the Corporation and Sabre or any customer or
supplier of Sabre or any Related Entity or between the Corporation and one or
more of the directors, officers or employees of the Corporation, Sabre or any
Related Entity, or any amendment, modification or termination thereof, or any
waiver of any right thereunder shall be void or voidable solely because Sabre or
such customer or supplier, any Related Entity or any one or more of the
directors, officers and employees of the Corporation, Sabre or any Related
Entity are parties thereto, or solely because any such directors, officers or
employees are present at or participate in the meeting of the Board of Directors
or committee thereof which authorize such Transaction or amendment,
modification, termination or waiver (each of which for purposes of this Article
Seven and Article Eight hereof shall also be deemed a "Transaction") or solely
because his or their votes are counted for such purpose, and Sabre, any Related
Entity and such directors, officers and employees (i) shall have fully satisfied
and fulfilled any fiduciary duty they may have to the Corporation and its
stockholders with respect thereto, (ii) shall not be liable to the Corporation
or its stockholders for any breach of any fiduciary duty they may have by reason
of the entering into, performance or consummation of any such Transaction, (iii)
shall be deemed to have acted in good faith
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and in a manner reasonably believed to be in and not opposed to the best
interests of the Corporation, to the extent such standard is applicable to such
Persons' conduct, (iv) shall be deemed not to have breached any duty of loyalty
to the Corporation or its stockholders they may have and not to have derived an
improper personal benefit therefrom, and (v) shall be deemed to have acted in a
manner entirely fair to the Corporation and its stockholders, if any of the
following requirements are met:
(w) the material facts as to the relationship or interest and as to
the Transaction are disclosed or are known to the Board of Directors or the
committee thereof that authorizes the Transaction and the Board of
Directors or such committee in good faith authorizes or approves the
Transaction by the affirmative vote of a majority of the disinterested
directors on the Board of Directors or such committee even if the
disinterested directors are less than a quorum;
(x) the material facts as to the relationship or interest and as to
the Transaction are disclosed or are known to the holders of Voting Stock
entitled to vote thereon, and the Transaction is specifically approved by
vote of the holders of a majority of the then outstanding Voting Stock not
Beneficially Owned by Sabre or such Related Entity, voting together as a
single class, as the case may be;
(y) such Transaction is effected pursuant to, and consistent with,
terms and conditions specified in any arrangements, standards, protocols or
guidelines (collectively, the "Guidelines") which are in good faith
authorized or approved, after disclosure or knowledge of the material facts
as to the relationship or interest and as to the Transaction, by the
affirmative vote of a majority of the disinterested directors on the Board
of Directors or the applicable committee thereof (even though the
disinterested directors be less than a quorum) or by vote of the holders of
a majority of the then outstanding Voting Stock not Beneficially Owned by
Sabre or such Related Entity, voting together as a single class, as the
case may be (such authorization or approval of such Guidelines constituting
or being deemed to constitute authorization or approval of such
Transaction); or
(z) such Transaction is fair as to the Corporation as of the time it
is authorized, approved or ratified by the Board of Directors, a committee
thereof or the stockholders of the Corporation.
E. Directors of the Corporation who are also directors, officers or
employees of Sabre or any Related Entity may be counted in determining the
presence of a quorum at a meeting of the Board of Directors or of a committee
that authorizes or approves any such Transaction or any such Guidelines. Voting
Stock Beneficially Owned by Sabre and any Related Entities may be counted in
determining the presence of a quorum at a meeting of stockholders that
authorizes or approves any such Transaction or any such Guidelines.
F. No vote cast or other action taken by any Person who is a director,
officer or employee or other representative of Sabre, which vote is cast or
action is taken by such Person in his capacity as a director of the Corporation,
shall constitute an action of, or the exercise of a right by, or a consent of,
Sabre for the purpose of any such Transaction.
G. Any Person purchasing or otherwise acquiring any interest in any shares
of stock of the Corporation shall be deemed to have notice of and to have
consented to the provisions of this Article Seven.
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H. For purposes of this Article Seven, any Transaction with any
corporation, partnership, joint venture, association or other entity in which
the Corporation Beneficially Owns, directly or indirectly, 50 percent or more of
the outstanding voting stock, voting power or similar voting interests, or with
any officer or director thereof, shall be deemed to be a Transaction with the
Corporation.
ARTICLE EIGHT
APPROVAL BY INDEPENDENT DIRECTOR
Notwithstanding anything to the contrary in Article Seven, until March 7,
2002, the Corporation shall not enter into any Transaction with Sabre or any
material customer or supplier of Sabre, or any amendment, modification or
termination thereof, or any waiver of any right thereunder unless (i) such
Transaction has been approved by at least one Independent Director or (ii) such
Transaction is effected pursuant to, and consistent with, terms and conditions
specified in any Guidelines authorized or approved by a majority of the
Independent Directors.
ARTICLE NINE
WRITTEN CONSENT; SPECIAL MEETINGS
Effective as of the Trigger Date, and subject to the rights of the holders
of any series of Preferred Stock, any action required or permitted to be taken
by the stockholders of the Corporation must be effected at a duly called annual
or special meeting of stockholders of the Corporation and may not be effected by
any consent in writing in lieu of a meeting of such stockholders. Except as
otherwise required by law or Articles Four or Five of this Restated Certificate
of Incorporation and subject to the rights of the holders of any series of
Preferred Stock, special meetings of the stockholders of the Corporation may be
called only by the Board of Directors pursuant to a resolution adopted by a
majority of the total number of directors which the Corporation would have if
there were no vacancies or by the Chairman of the Board; provided, that, prior
to the Trigger Date, special meetings of the stockholders of the Corporation may
also be called at the request of the holders of a majority of the voting power
of the then outstanding Voting Stock. Except as expressly provided in the
immediately preceding sentence, any power of stockholders to call a special
meeting is specifically denied. Only such business as shall have been brought
before the special meeting of stockholders pursuant to the Corporation's notice
of meeting shall be conducted at such meeting.
ARTICLE TEN
LIMITATION OF LIABILITY
A director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director; provided, however, that the foregoing shall not eliminate or
limit the liability of a director (i) for any breach of the director's duty of
loyalty to the Corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which
the director derived an improper personal benefit. If the DGCL is hereafter
amended to permit further elimination or limitation of the personal liability of
directors, then the liability of a director of the Corporation shall be
eliminated or limited to the fullest extent permitted by the DGCL as so amended.
Any repeal or modification of this Article Nine by the stockholders of the
Corporation or otherwise shall not adversely affect any right or protection of a
director of the Corporation existing at the time of such repeal or modification.
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ARTICLE ELEVEN
DEFINITIONS
For purposes of this Certificate of Incorporation:
"Affiliate" shall mean with respect to a specified Person, any Person that
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with the specified Person.
"Beneficial Owner," "Beneficially Own," "Beneficially Owned," "Beneficial
Ownership," and words of similar import shall have the meaning ascribed to such
term in Rule 13d-3 of the General Rules and Regulations of the Securities
Exchange Act of 1934 as in effect on the date hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Person" shall mean any individual, firm, partnership, corporate or other
entity.
"Subsidiary" shall mean any corporation of which a majority of any series
or class of equity security is owned, directly or indirectly, by a different
corporation.
"Tax-Free Spin-Off" shall mean a distribution of Common Stock or Class B
Common Stock as a spin-off, split-up or split-off to holders of Class A or Class
B common stock of Sabre Parent intended to qualify as a tax-free distribution
under Section 355(a) of the Code.
"Trigger Date" shall mean the first time at which Sabre shall cease to be
the Beneficial Owner of an aggregate of at least a majority of the voting power
of the Voting Stock then outstanding.
"Voting Stock" shall mean the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of directors.
ARTICLE TWELVE
AMENDMENT
The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Restated Certificate of Incorporation, in the manner
now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation. Notwithstanding
anything contained in this Restated Certificate of Incorporation or the By-Laws
of the Corporation to the contrary, effective as of the Trigger Date, the
affirmative vote of the holders of at least 80 percent of the voting power of
the then outstanding Voting Stock, voting together as a single class, shall be
required to amend, alter, change or repeal any provision contained in this
Restated Certificate of Incorporation. Neither the alteration, amendment or
repeal of Articles Six or Seven hereof, nor the adoption of any provision of
this Restated Certificate of Incorporation inconsistent with Articles Six or
Seven hereof, shall eliminate or reduce the effect of Articles Six or Seven
hereof in respect of any matter occurring, or any cause of action, suit or claim
that, but for Article Six or Seven hereof, would accrue or arise, prior to such
alteration, amendment, repeal or adoption.
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IN WITNESS WHEREOF, this Restated Certificate of Incorporation which
restates, integrates and amends the provisions of the Certificate of
Incorporation of the Corporation, as heretofore amended, and which has been
adopted by written consent of the stockholders of the Corporation in accordance
with the provisions of Sections 228, 242 and 245 of the DGCL, written notice
having been given as required by said Section 228 of the DGCL has been executed
in the name of and on behalf of Travelocity.com Inc. on this day of August,
2000.
Travelocity.com Inc.
By:
--------------------------------
Name: Terrell B. Jones
Title: President and
Chief Executive Officer
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