<PAGE> 1
EXHIBIT 3.1
CERTIFICATE OF INCORPORATION
OF
TOM BROWN, INC.
FIRST: The name of the Corporation is Tom Brown, Inc.
SECOND: The address of its registered office in the State of Delaware is 1209
Orange Street, in the City of Wilmington, County of New Castle 19801. The name
of its registered agent at such address is The Corporation Trust Company.
THIRD: The nature of the business of the Corporation and the objects and
purposes and business thereof proposed to be transacted, promoted or carried on
are as follows:
To transact any and all lawful act or activity for which a corporation
may be incorporated under the laws of the State of Delaware.
FOURTH: The total number of shares of all classes that the Corporation shall
have authority to issue is 250,000,000, of which 50,000,000 shares shall be
Preferred Stock, par value $.10 per share, and 200,000,000 shares shall be
Common Stock, $.10 par value per share. All of such shares shall, upon issuance
thereof, be fully paid and nonassessable.
The designations, preferences, limitations and relative rights of the
shares of each class that the Corporation shall have authority to issue are as
follows:
A. Preferred Stock. The Board of Directors is hereby expressly
vested with the authority to adopt a resolution or resolutions
providing for the issue of authorized but unissued shares of
Preferred Stock, which shares may be issued from time to time
in one or more series and in such amounts as may be determined
by the Board of Directors in such resolution or resolutions.
The designations, preferences, limitations or relative rights
of the Preferred Stock and the qualifications, limitations or
restrictions, if any, of such preferences and/or rights
(collectively, the "Series Terms") may vary between series in
any and all respects and shall be such as are stated and
expressed in a resolution or resolutions providing for the
creation or revision of such Series Terms set forth in a
Certificate of Designations (a "Preferred Stock Series
Resolution") adopted by the Board of Directors; provided that
all shares of any one series of Preferred Stock so designated
by the Board of Directors shall be identical in all respects
except that shares of any one series issued at different times
may differ as to the dates from which dividends thereon may be
cumulative. The powers of the Board of Directors with respect
to the Series Terms of a particular series shall include, but
not be limited to, determination of the following:
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1. The right to receive dividends, if any, and the rate,
dates, terms and other conditions on which such
dividends shall be payable;
2. The nature of the dividend payable, if any, with
respect to shares of such series as cumulative,
noncumulative or partially cumulative;
3. The redemption rights of such series including the
price at and the terms and conditions on which such
shares may be redeemed;
4. The amount payable upon shares in the event of
involuntary liquidation;
5. The amount payable upon shares in the event of
voluntary liquidation;
6. Sinking fund provisions for the redemption or
purchase of shares;
7. The terms and conditions on which shares may be
converted, if the shares of any series are issued
with the privilege of conversion;
8. Voting rights, if any; and
9. Repurchase obligations of the Corporation with
respect to the shares of each series.
Any of the Series Terms, including voting rights, of any
series may be made dependent upon facts ascertainable outside
this Certificate of Incorporation and the Preferred Stock
Series Resolution, provided that the manner in which such
facts shall operate upon such Series Terms is clearly and
expressly set forth herein or in the Preferred Stock Series
Resolution.
Subject to the provisions of this Paragraph Fourth, shares of
one or more series of Preferred Stock may be authorized or
issued from time to time as shall be determined by and for
such consideration as shall be fixed by the Board of
Directors, in an aggregate amount not exceeding the total
number of shares of Preferred Stock authorized herein. Except
in respect of Series Terms fixed by the Board of Directors as
permitted hereby, all shares of Preferred Stock shall be of
equal rank and shall be identical.
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B. Common Stock.
1. Dividends. Subject to the provisions of any Preferred
Stock Series Resolution, the Board of Directors may,
in its discretion, out of funds legally available for
the payment of dividends and at such times and in
such manner as determined by the Board of Directors,
declare and pay dividends on the Common Stock of the
Corporation.
No dividend (other than a dividend in capital stock
ranking on a parity with the Common Stock or cash in
lieu of fractional shares with respect to such stock
dividend) shall be declared or paid on any share or
shares of any class of stock or series thereof
ranking on a parity with the Common Stock in respect
of payment of dividends for any dividend period
unless there shall have been declared, for the same
dividend period, like proportionate dividends on all
shares of Common Stock then outstanding.
2. Liquidation. In the event of any liquidation,
dissolution or winding up of the Corporation, whether
voluntary or involuntary, after payment or provision
for payment of the debts and other liabilities of the
Corporation and after payment of any preferential
amount due to the holders of any other class or
series of stock, the holders of the Common Stock
shall be entitled to receive ratably any or all
assets remaining to be paid or distributed.
3. Voting Rights. Subject to any special voting rights
set forth in any Preferred Stock Series Resolution,
the holders of the Common Stock of the Corporation
shall be entitled at all meetings of shareholders to
one vote for each share of such stock held by them.
C. Prior, Parity or Junior Stock. Whenever reference is made in
this Paragraph Fourth or in any Preferred Stock Series
Resolution to shares "ranking prior to" another class or
series of stock or "on a parity with" another class or series
of stock, such reference shall mean and include all other
shares of the Corporation in respect of which the rights of
the holders thereof as to the payment of dividends or as to
distributions in the event of a voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the
Corporation are given preference over, or rank on an equality
with, as the case may be, the rights of the holders of such
other class or series of stock. Whenever reference is made to
shares "ranking junior to" another class of stock, such
reference shall mean and include all shares of the Corporation
in respect of which the rights of the holders thereof as to
the payment of dividends and as to distributions in the event
of a voluntary or involuntary
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liquidation, dissolution or winding up of the affairs of the
Corporation are junior and subordinate to the rights of the
holders of such class or series of stock.
Except as otherwise provided herein or in any Preferred Stock
Series Resolution, each series of Preferred Stock ranks on a
parity with each other series and each series ranks prior to
the Common Stock. Common Stock ranks junior to the Preferred
Stock.
D. Liquidation. For the purposes of Section (2) of Section B of
this Paragraph Fourth and for the purpose of the comparable
sections of any Preferred Stock Series Resolution, the merger
or consolidation of the Corporation into or with any other
corporation, or the merger of any other corporation into it,
or the sale, lease or conveyance of all or substantially all
the assets, property or business of the Corporation, shall not
be deemed to be a liquidation, dissolution or winding up of
the Corporation.
E. Reservation and Retirement of Shares. The Corporation shall at
all times reserve and keep available, out of its authorized
but unissued shares of Common Stock or out of shares of Common
Stock held in its treasury, the full number of shares of
Common Stock into which all shares of any series of Preferred
Stock having conversion privileges from time to time
outstanding are convertible.
Unless otherwise provided in a Preferred Stock Series
Resolution with respect to a particular series of Preferred
Stock, all shares of Preferred Stock redeemed or acquired (as
a result of conversion or otherwise) shall be retired and
restored to the status of authorized but unissued shares.
F. Preemptive Rights.
1. No holder of shares of Preferred Stock or Common
Stock of the Corporation shall have any preemptive
right to purchase or subscribe for or receive any
shares of any class, or series thereof, of stock of
the Corporation, whether now or hereafter authorized,
or any warrants, options, bonds, debentures or other
securities convertible into, exchangeable for or
carrying any right to purchase any shares of any
class, or series thereof, of stock; but such
additional shares of stock and such warrants,
options, bonds, debentures or other securities
convertible into, exchangeable for or carrying any
right to purchase any shares of any class, or series
thereof, of stock may be issued or disposed of by the
Board of Directors to such persons, and on such terms
and for such lawful consideration, as in its
discretion it shall deem advisable.
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2. The stockholders of the Corporation shall have no
rights to acquire the shares of Common Stock of the
Corporation now held in the treasury of the
Corporation or any shares of Common Stock of the
Corporation hereafter acquired by the Corporation and
held as treasury shares.
G. No Cumulative Voting. Cumulative voting shall not be allowed
in the election of Directors or for any other purpose.
H. Repurchases of Capital Stock. The Corporation may, without
shareholder approval, purchase, directly or indirectly, its
own shares to the extent permitted by the Delaware General
Corporation Law.
FIFTH: The names and mailing address of the incorporators are:
<TABLE>
<CAPTION>
Name Address
---- -------
<S> <C>
Thomas C. Brown 500 Empire Plaza
Midland, Texas 79701
Donald L. Evans 500 Empire Plaza
Midland, Texas 79701
</TABLE>
SIXTH: The name and mailing addresses of the persons who are to serve as
directors until the first annual meeting of stockholders or until their
successors are duly elected and qualified are:
<TABLE>
<CAPTION>
Name Address
---- -------
<S> <C>
Thomas C. Brown 500 Empire Plaza
Midland, Texas 79701
Donald L. Evans 500 Empire Plaza
Midland, Texas 79701
Joe G. Roper 5609 West Industrial
Boulevard
Midland, Texas 79701
</TABLE>
SEVENTH: The Corporation is to have perpetual existence.
EIGHTH: The Board of Directors shall have power to enact, alter, amend and
repeal bylaws not inconsistent with the laws of the State of Delaware and this
Certificate of Incorporation.
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NINTH: Limitation of Certain Liability of Directors. 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,
except for liability (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 Delaware General Corporation Law, or (iv) for any transaction
from which the director derived an improper personal benefit. In addition to the
circumstances in which a director of the Corporation is not personally liable as
set forth in the preceding sentence, a director shall not be liable to the
fullest extent permitted by any amendment to the Delaware General Corporation
law hereafter enacted that further limits the liability of a director.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation with respect to any matter occurring
or any cause of action, suit or claim that, but for this Article Ninth, would
accrue or arise, prior to the time of such repeal or modification.
TENTH: Indemnification and Insurance.
A. Right to Indemnification. Each person who was or is made a
party or is threatened to be made a party to or is involved in
any action, suit or proceeding, whether civil, criminal,
administrative or investigative (hereinafter a "proceeding"),
by reason of the fact that he or she, or a person of whom he
or she is the legal representative, is or was a director or
officer, of the Corporation or is or was serving at the
request of the Corporation as a director, officer, employee or
agent of another corporation or of a partnership, joint
venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of such
proceeding is alleged action in an official capacity as a
director, officer, employee or agent or in any other capacity
while serving as a director, officer, employee or agent, shall
be indemnified and held harmless by the Corporation to the
fullest extent authorized by the Delaware General Corporation
Law, as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such
amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation
to provide prior to such amendment), against all expense,
liability and loss (including attorneys' fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid or to
be paid in settlement) reasonably incurred or suffered by such
person in connection therewith and such indemnification shall
continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of
his or her heirs, executors and administrators; provided,
however, that, except as provided in
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paragraph (b) hereof, the Corporation shall indemnify any such
person seeking indemnification in connection with a proceeding
(or part thereof) initiated by such person only if such
proceeding (or part thereof) was authorized by the board of
directors of the Corporation. The right to indemnification
conferred in this Section shall be a contract right and shall
include the right to be paid by the Corporation the expenses
incurred in defending any such proceeding in advance of its
final disposition; provided, however, that, if the Delaware
General Corporation Law requires, the payment of such expenses
incurred by a director or officer in his or her capacity as a
director of officer (and not in any other capacity in which
service was or is rendered by such person while a director or
officer, including, without limitation, service to an employee
benefit plan) in advance of the final disposition of a
proceeding, shall be made only upon delivery to the
Corporation of an undertaking, by or on behalf of such
director or officer, to repay all amounts so advanced if it
shall ultimately be determined that such director or officer
is not entitled to be indemnified under this Paragraph A or
otherwise. The Corporation may, by action of its Board of
Directors, provide indemnification to employees and agents of
the Corporation with the same scope and effect as the
foregoing indemnification of directors and officers.
B. Right of Claimant to Bring Suit. If a claim under Paragraph A
of this Paragraph Tenth is not paid in full by the Corporation
within ninety days after a written claim has been received by
the Corporation, the claimant may at any time thereafter bring
suit against the Corporation to recover the unpaid amount of
the claim and, if successful in whole or in part, the claimant
shall be entitled to be paid also the expense of prosecuting
such claim. It shall be a defense to any such action (other
than an action brought to enforce a claim for expenses
incurred in defending any proceeding in advance of its final
disposition where the required undertaking, if any is
required, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it
permissible under the Delaware General Corporation Law for the
Corporation to indemnify the claimant for the amount claimed,
but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including
its Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the
commencement of such action that indemnification of the
claimant is proper in the circumstances because he or she has
met the applicable standard of conduct set forth in the
Delaware General Corporation Law, nor an actual determination
by the Corporation (including its Board of Directors,
independent legal counsel, or its stockholders) that the
claimant has
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<PAGE> 8
not met such applicable standard or conduct, shall be a
defense to the action or create a presumption that the
claimant has not met the applicable standard of conduct.
C. Non-Exclusivity of Rights. The right to indemnification and
the payment of expenses incurred in defending a proceeding in
advance of its final disposition conferred in this Paragraph
shall not be exclusive of any other right which any person may
have or hereafter acquire under any statute, provision of the
Certificate of Incorporation, bylaw, agreement, vote of
stockholders or disinterested directors or otherwise.
D. Insurance. The Corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee
or agent of the Corporation or another corporation,
partnership, joint venture, trust or other enterprise against
any such expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person
against such expense, liability or loss under the Delaware
General Corporation Law.
ELEVENTH: The Corporation reserves the right to amend, alter, change or repeal
any provision contained in this 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.
WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that this is our act and deed and the facts herein
stated are true, and accordingly, have hereunto set our hands this 25th day of
February, 1987.
/s/ Thomas C. Brown
------------------------
Thomas C. Brown
/s/ Donald L. Evans
------------------------
Donald L. Evans
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<PAGE> 9
TOM BROWN, INC.
CERTIFICATE OF DESIGNATIONS, PREFERENCES
AND RIGHTS OF SERIAL PREFERRED STOCK -
SERIES A NON-VOTING CONVERTIBLE 6%
CUMULATIVE PREFERRED STOCK
The undersigned, President and Secretary, respectively, of Tom Brown,
Inc., a Delaware corporation (the "Company"), certify that pursuant to authority
granted to and vested in the Board of Directors of the Company by provisions of
the Certificate of Incorporation of the Company, the Board of Directors has duly
adopted the following resolutions creating a series of serial preferred stock of
the Company designated as the Series A Non-Voting Convertible 6% Cumulative
Preferred Stock:
"RESOLVED, That the Board of Directors of Tom Brown, Inc. (the
"Company"), in the exercise of its best business judgment and intending
to act in full compliance with the applicable provisions of the
Company's Certificate of Incorporation and Bylaws and the provisions of
the Delaware General Corporation Law, hereby establishes a series of
Preferred Stock, par value $0.10 per share, of the Company designated
as "Series A Non-Voting Convertible 6% Cumulative Preferred Stock" (the
"Series A Shares"), and the number of Series A Shares which the Company
is authorized to issue from time to time shall be 22,000,000 and the
designations, preferences, limitations, and relative rights, and
qualifications, limitations and restrictions, of the Series A Shares
shall be as follows:
1. Liquidation. The Series A Shares shall be preferred as to assets
over Junior Shares so that, in the event of the voluntary or
involuntary liquidation, dissolution or winding up of the Company, the
holders of the Series A Shares shall be entitled, in conjunction with
any provision then being made for the holders of Parity Shares, if any,
to have set apart for them or to be paid out of the assets of the
Company, after payment or provision for payment of the debts and other
liabilities of the Company and after provision for the holders of
Senior Shares, if any, but before any distribution is made to or set
apart for the holders of Junior Shares, an amount in cash equal to
$1.1364 per Series A Share (as adjusted for any stock split, reverse
stock split, stock dividend or similar event resulting in a change in
the Series A Shares) (the "Liquidation Value"), together with all
dividends accrued on such Series A Shares to the date of payment,
irrespective of whether such dividends were earned, declared or legally
available, and the holders
<PAGE> 10
of the Series A Shares shall not be entitled to any further payment in
connection with the voluntary or involuntary liquidation, dissolution
or winding up of the Company except as expressly provided for in this
resolution. If, upon such liquidation, dissolution or winding up of the
Company, the assets of the Company available for distribution to the
holders of the Series A Shares and the holders of Parity Shares, if
any, shall be insufficient to permit the distribution in full of the
amounts receivable as aforesaid by the holders of the Series A Shares
and the amounts receivable by the holders of Parity Shares, if any,
then all such assets of the Company shall be distributed ratably among
the holders of the Series A Shares and the holders of Parity Shares, if
any, in proportion to the amounts that each would have been entitled to
receive if such assets were sufficient to permit distribution in full
as aforesaid. Neither the consolidation or merger of the Company with
or into any corporation or corporations, nor the sale, lease or
transfer by the Company of all or any part of its assets, nor the
reduction of the authorized or issued shares of the Company of any
class, whether now or hereafter authorized, shall be deemed to be a
liquidation, dissolution or winding up of the Company for the purposes
of this Section 1. Written notice of any voluntary or involuntary
liquidation, dissolution or winding up of the Company, setting the
payment date and the place where the amounts to be distributed shall be
paid and containing a reference to the conversion option granted by
Section 2 hereof, shall be given not less than thirty (30) days prior
to the payment date stated therein to the holders of record of the
Series A Shares at their respective addresses as the same shall appear
on the stock ledger of the Company.
2. Conversion.
(a) Subject to the terms and conditions of this Section 2, the
Series A Shares shall be convertible, at any time and from time to
time, at the option of the holder thereof, into Common Shares by
surrender of the certificate or certificates for the Series A Shares to
be so converted, duly endorsed, at the principal office of the Company
(or at such other place or places as may be designated by the Company
from time to time by notice sent to the holders of the Series A Shares
at their respective addresses as the same shall appear on the stock
ledger of the Company) or at the corporate trust office of any transfer
agent for the Series A Shares at any time during normal business hours,
together with notice that the holder elects to convert such Series A
Shares, or a stated number of such shares, in accordance with the
provisions of this Section 2. Such notice shall also state the name or
names (with addresses) in which the certificate or certificates for
Common Shares shall be issued. The number of Common Shares that any
such holder shall receive in return for each Series A Share converted
by such holder shall be computed by dividing (x) $1.1364 (as adjusted
for any stock split, reverse stock split, stock dividend or similar
event resulting in a change in the Series A Shares) by (y) the
Conversion Price then in effect.
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(b) As promptly as practicable after exercise by any holder of
Series A Shares of such holder's option to convert Series A Shares
pursuant to the provisions of this Section 2, the Company shall deliver
or cause to be delivered to or upon the written order of such holder
one or more certificates representing the number of Common Shares
issuable upon such conversion, issued in such name or names as such
holder may direct, together with, if the certificate or certificates
surrendered evidence a greater number of Series A Shares than the
number of Series A Shares to be converted, one or more certificates
evidencing the Series A Shares not to be converted, issued in such name
or names as such holder may direct, and accompanied by any cash in
respect of any fractional interest in a Common Share issuable upon such
conversion. Each such conversion shall be deemed to have been made
immediately prior to the close of business on the day the option to
convert is exercised, and all rights of the converting holder as the
holder of the Series A Shares surrendered for conversion shall cease at
such time and the person or persons in whose name or names the
certificate or certificates for the Common Shares issuable upon
conversion are to be issued shall be treated for all purposes as having
become the record holder or holders thereof at such time, except that,
if the date of exercise of the conversion option is a date when the
stock ledger of the Company is closed, such person or persons shall be
deemed to have become the holder or holders of such shares at the close
of business on the next succeeding date on which the stock ledger is
open.
(c) The initial Conversion Price shall be $0.2841. The
Conversion Price shall be subject to adjustment as follows:
A. If the Company shall pay a dividend or make any
other distribution to all holders of the Common Shares payable
in Common Shares or shall subdivide its outstanding Common
Shares into a greater number of shares, the Conversion Price
in effect immediately prior thereto shall be proportionately
reduced, and if the Company shall combine its outstanding
Common Shares into a smaller number of shares, the Conversion
Price in effect immediately prior thereto shall be
proportionately increased. An adjustment made pursuant to this
subdivision A shall become effective as of the date the record
is taken for such dividend or distribution or such subdivision
or combination or, if no record is taken, the date as of which
the record holders of Common Shares entitled to such payment
or other distribution or to participate in such subdivision or
combination are determined.
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<PAGE> 12
B. If on or after December 24, 1986, the Company
issues or sells, or in accordance with subdivision C below is
deemed to have issued or sold, any Common Shares (other than
(i) Common Shares issued or sold pursuant to the exercise of
options, warrants or rights outstanding as of December 24,
1986, (ii) by reason of the grant of options under the Tom
Brown, Inc. Incentive Stock Option Plan, to purchase up to a
total of 600,000 Common Shares (as adjusted pursuant to the
provisions of the plan designed to protect against dilution)
at a per share purchase price of not less than 100% of the
fair market value of a Common Share on the date of grant and
Common Shares issued or sold pursuant to the exercise of such
options, (iii) issuances or sales of Common Shares for which
an adjustment of the Conversion Price is made pursuant to
subdivision A above, or (iv) pursuant to transactions for
which appropriate provision is made pursuant to Section 2(d)
or 2(e) hereof) for a consideration per share less than the
Conversion Price or the Market Price, as the case may be, in
effect immediately prior to such time, then forthwith upon
such issuance or sale the Conversion Price shall be adjusted
to that Conversion Price determined by multiplying the
Conversion Price then in effect by a fraction (1) the
numerator of which shall be the number of Common Shares
outstanding immediately prior to the issuance or sale of such
additional Common Shares plus the number of Common Shares
which the aggregate consideration received by the Company for
the total number of Common Shares so issued or sold would
purchase at the Conversion Price or the Market Price, as the
case may be, in effect immediately before such adjustment, and
(2) the denominator of which shall be the number of Common
Shares outstanding immediately after the issuance or sale of
such Common Shares.
C. For the purposes of determining the adjusted
Conversion Price under subdivision B above, the following
shall be applicable:
(i) If on or after December 24, 1986, the
Company in any manner grants any right or option to
subscribe for or to purchase Common Shares or any
stock or other securities convertible into or
exchangeable for Common
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Shares (such rights or options being herein called
"Options" and such convertible or exchangeable stock
or securities being herein called "Convertible
Securities") and the lowest price per share for which
any one Common Share is issuable upon the exercise of
any such Option or upon conversion or exchange of any
such Convertible Security is less than the Conversion
Price or the Market Price, as the case may be, in
effect immediately prior to the time of the granting
of such Option, then the Conversion Price shall be
adjusted as provided in subdivision B above on the
basis that the maximum number of Common Shares
issuable upon the exercise of all such Options and
upon conversion or exchange of all such Convertible
Securities shall be deemed to have been issued as of
the date of such grant and the aggregate
consideration for such maximum number of additional
Common Shares shall be deemed to be the minimum
consideration received or receivable by the Company
(if any) upon the issuance of such additional Common
Shares on the exercise of the Options or the
conversion or exchange of the Convertible Securities.
For the purposes of this paragraph (i), the "lowest
price per share for which any one Common Share is
issuable" shall be equal to the sum of the lowest
amounts of consideration (if any) received or
receivable by the Company with respect to any one
Common Share upon the granting of the Option, upon
the exercise of the Option, and upon the conversion
or exchange of the Convertible Security. No further
adjustment of the Conversion Price shall be made upon
the actual issue of such Common Shares or of such
Convertible Securities upon the exercise of such
Option or upon the actual issue of such Common Shares
upon conversion or exchange of such Convertible
Securities.
(ii) If on or after December 24, 1986, the
Company in any manner issues or sells any Convertible
Security and the lowest price per share for which any
one Common Share is issuable upon conversion or
exchange thereof is less than the Conversion Price or
the Market Price, as the case may be, in effect
immediately
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<PAGE> 14
prior to the time of such issuance or sale, then the
Conversion Price shall be adjusted as provided in
subdivision B above on the basis that the maximum
number of Common Shares issuable upon conversion or
exchange of all such Convertible Securities shall be
deemed to have been issued as of the date of such
issue or sale and the aggregate consideration for
such maximum number of additional Common Shares shall
be deemed to be the minimum consideration received or
receivable by the Company (if any) upon the issuance
of such additional Common Shares or the issuance or
sale of such Convertible Securities and the
conversion or exchange thereof. For the purposes of
this paragraph (ii), the "lowest price per share for
which any one Common Share is issuable" shall be
equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the
Company with respect to any one Common Share upon the
issuance or sale of such Convertible Security and
upon the conversion or exchange of such Convertible
Security. No further adjustment of the Conversion
Price shall be made upon the actual issue of such
Common Shares upon conversion or exchange of such
Convertible Security, and if any such issue or sale
of such Convertible Security is made upon exercise of
any Options for which adjustments of the Conversion
Price had been or are to be made pursuant to other
provisions of this subdivision C, no further
adjustment of the Conversion Price shall be made by
reason of such issue or sale.
(iii) If the purchase price provided for in
any Option, the additional consideration (if any)
payable upon the issue, conversion or exchange of any
Convertible Security, or the rate at which any
Convertible Security is convertible into or
exchangeable for Common Shares changes at any time,
the Conversion Price in effect at the time of such
change shall be readjusted to the Conversion Price
that would have been in effect at such time had such
Option or Convertible Security originally provided
for such changed purchase price, changed additional
consideration or changed conversion rate, as the case
may be,
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<PAGE> 15
at the time initially granted, issued or sold;
provided, however, that if such adjustment of the
Conversion Price shall result in an increase in the
Conversion Price then in effect, such adjustment
shall not be effective until thirty (30) days after
notice thereof has been given to all holders of the
Series A Shares at their respective addresses as the
same shall appear on the stock ledger of the Company.
(iv) Upon the expiration of any Option or
the termination of any right to convert or exchange
any Convertible Security without the exercise of any
such Option or right, the Conversion Price then in
effect shall be adjusted to the Conversion Price that
would have been in effect at the time of such
expiration or termination had such Option or
Convertible Security, to the extent outstanding
immediately prior to such expiration or termination,
never been issued; provided, however, that if the
Company shall accelerate the expiration of any Option
or the termination of any right to convert or
exchange any Convertible Security, such adjustment
shall not be effective until thirty (30) days after
notice of such acceleration has been given to all
holders of the Series A Shares.
(v) If any Common Share, Option or
Convertible Security is issued or sold or deemed to
have been issued or sold for cash, the consideration
received therefor shall be deemed to be the amount
received by the Company therefor, without deduction
therefrom of any expenses incurred or any
underwriting commissions or concessions paid or
allowed by the Company in connection therewith.
Except as provided below in this subdivision (v), in
case any Common Share, Option or Convertible Security
is issued or sold or deemed to have been issued or
sold for a consideration other than cash, the amount
of the consideration other than cash received by the
Company shall be the fair value of such
consideration, determined in good faith by the Board
of Directors of the Company, except where such
consideration consists of securities, in which case
the amount of consideration
-7-
<PAGE> 16
received by the Company shall be the Market Price
thereof as of the date of receipt, but in each such
case without deduction of any expenses incurred or
any underwriting commission or concessions paid or
allowed by the Company in connection therewith. In
computing the Market Price of a note or other
obligation that is not listed on any securities
exchange or quoted in the NASDAQ System or for which
market quotations are not otherwise readily
available, the total consideration to be received by
the Company thereunder (including interest) shall be
discounted to present value at the prime rate of
interest of InterFirst Bank Dallas, N.A., (or its
successor in interest) in effect at the time the note
or obligation is deemed to have been issued. If any
Common Share, Option or Convertible Security is
issued in connection with any merger in which the
Company is the surviving corporation, the amount of
consideration therefor will be deemed to be the fair
value, as determined in good faith by the Board of
Directors, of such portion of the net assets and
business of the nonsurviving corporation as is
attributable to such Common Share, Option or
Convertible Security, as the case may be. If any
Common Share, Option or Convertible Security is
issued in payment or satisfaction of any dividend
upon any class of stock other than Common Shares, the
amount of consideration therefor will be deemed to be
equal to the amount of such dividend so paid or
satisfied.
(vi) In case any Option is issued in
connection with the issue or sale of other securities
of the Company, together comprising one integrated
transaction in which no specific consideration is
allocated to such Option by the parties thereto, the
Option shall be deemed to have been granted for
consideration of $0.01.
(vii) If the purchase price provided for in
any option, warrant or right referred to in clause
(i) or (ii) of the parenthetical in subdivision B
above shall change at any time (other than by reason
of the provisions designed to protect against
dilution), then such change shall be
-8-
<PAGE> 17
deemed the issuance of a new Option as of the date of
such change for the purposes of said subdivision B.
(d) If the Company shall distribute (pursuant to a dividend or
otherwise) to all holders of the Common Shares of its capital stock
(other than Common Shares), evidences of indebtedness, assets or other
property (excluding dividends payable in cash out of surplus
(determined in accordance with generally accepted accounting
principles, consistently applied)), or options, warrants or rights to
subscribe for or to purchase securities of the Company or other
property, then, in each such case, appropriate provision shall be made
(without any adjustment of the Conversion Price) to ensure that the
holder of each Series A Share then outstanding shall have the right to
receive, upon conversion of such Series A Share, with respect to the
Common Shares such holder shall receive upon conversion and in addition
thereto and without payment of any consideration therefor, such capital
stock, evidences of indebtedness, assets or other property, or such
options, warrants or rights, that such holder would have received upon
such distribution had such holder been the holder of record of the
number of Common Shares into which such Series A Share could have been
converted immediately prior to such distribution on the date on which
the record was taken for such distribution, or, if no record was taken,
the date as of which the record holders of Common Shares entitled to
such distribution were determined.
(e) In case of (i) any reclassification or change of the
outstanding Common Shares (other than a change in par value, or from
par value to no par value, or from no par value to par value, or a
change in the Common Shares as a result of a subdivision or combination
for which an adjustment of the Conversion Price is made pursuant to
subdivision A of Section 2(c), or (ii) any consolidation or merger of
the Company or any Subsidiary with or into another entity, or (iii) any
sale or conveyance to another corporation of the assets of the Company
as an entirety or substantially as an entirety, as a result of which in
any such case the holders of all the Common Shares are entitled to
receive (either directly or upon subsequent liquidation pursuant to a
plan of liquidation adopted in connection with such transaction) stock
or other securities or property with respect to or in exchange for the
Common Shares, then, in each such case, without any adjustment of the
Conversion Price, effective as of the effective time of any such
reclassification, change, consolidation, merger, sale or conveyance, as
the case may be, the holder of each Series A Share then outstanding
shall have the right to receive or acquire, upon conversion of such
Series A Share, in lieu of or in addition to the
-9-
<PAGE> 18
Common Shares theretofore receivable upon such conversion, the kind and
amount of shares of stock and other securities and property receivable
upon such reclassification, change, consolidation, merger, sale or
conveyance by a holder of the number of Common Shares into which such
Series A Share could have been converted immediately prior to such
reclassification, change, consolidation, merger, sale or conveyance.
The Company shall not effect any such consolidation, merger, sale or
conveyance unless prior to or simultaneously with the consummation
thereof the successor corporation (if other than the Company) resulting
from such consolidation or merger or the entity purchasing such assets
assumes by written instrument (in form reasonably satisfactory to the
holders of a majority of the Series A Shares then outstanding) the
obligation to deliver to each such holder such shares of stock or other
securities or property as, in accordance with the foregoing provisions
of this subsection (e), such holder may be entitled to receive or
acquire. In each such case, appropriate adjustments shall be made in
the application of the provisions of this Section 2 with respect to the
rights and interests thereafter of the holders of the Series A Shares,
to the end that the provisions of this Section 2 shall thereafter be
applicable, as nearly as reasonably may be, to the stock or other
securities or property thereafter deliverable in lieu of Common Shares
upon the conversion of Series A Shares. The provisions of this
subsection (e) shall similarly apply to successive reclassifications,
changes, consolidations, mergers, sales and conveyances. If the
occurrence of any one event shall give rise to an adjustment under both
this subsection (e) and Section 2(d) hereof, then the terms of this
subsection (e) shall control.
(f) If on or after December 24, 1986, the Company shall take
any action affecting the Common Shares, other than an action described
in subsections (c), (d) or (e) above, which, in the opinion of the
Board of Directors of the Company, would have a material adverse effect
upon the conversion option granted by this Section 2, the Conversion
Price shall be adjusted in such manner and at such time as the Board
may in good faith determine to be equitable in the circumstances.
(g) Except as otherwise provided in this Section 2, if an
adjustment to the Conversion Price is required under more than one
subsection or subdivision of this Section 2, then the Conversion Price
shall be adjusted in the manner provided herein which will result in
the greater reduction in the Conversion Price.
(h) Any determination as to fair value or as to whether any
adjustment (including an adjustment of the Conversion Price) is
required hereunder, or as to the amount of any such adjustment, if
-10-
<PAGE> 19
required, shall be binding upon the holders of the Series A Shares and
the Company if made in good faith by the Board of Directors of the
Company.
(i) Whenever the Conversion Price is adjusted as provided in
this Section 2, then, in each such case, the Company shall notify the
transfer agent, if any, for the Series A Shares and shall promptly give
to the holders of the Series A Shares who are holders of record not
more than fifteen (15) days before the date such notice is given, a
notice stating (i) the event requiring the adjustment, (ii) the method
by which the adjustment was calculated (including a description of the
basis on which the Board of Directors of the Company made any
determination hereunder), and (iii) the adjusted Conversion Price then
and thereafter effective under this Section 2. An affidavit of the
transfer agent for the Series A Shares or of the Secretary of the
Company that any such notice has been given shall, in the absence of
fraud, be prima facie evidence of the facts stated therein.
(j) In case at any time:
(i) the Board of Directors of the Company shall
declare a dividend (or any other distribution) on the Common
Shares; or
(ii) the Board of Directors of the Company shall
authorize the granting to all holders of the Common Shares of
options, warrants or rights to subscribe for or to purchase
any shares of stock of any class or of any other options,
warrants or rights; or
(iii) the Board of Directors of the Company shall
authorize any reclassification of the Common Shares, any
consolidation or merger of the Company or any Subsidiary with
or into another corporation, or the sale or conveyance of all
or a substantial portion of the assets of the Company; or
(iv) the Board of Directors of the Company shall
authorize the voluntary liquidation, dissolution or winding up
of the Company;
then the Company shall cause to be given to each holder of Series A
Shares, as promptly as possible but in any event at least twenty (20)
days (sixty (60) days in the case of any merger or consolidation to
which the Company or any Subsidiary is a party or the sale or
conveyance of all or a substantial portion of the Company's assets)
-11-
<PAGE> 20
prior to the applicable date hereinafter specified, a notice stating
(1) the date on which a record is to be taken for the purposes of such
dividend, distribution or granting of options, warrants or rights, or,
if a record is not to be taken, the date as of which the holders of
Common Shares of record to be entitled to such dividend, distribution
or options, warrants or rights are to be determined, or (2) the date on
which such reclassification, consolidation, merger, sale, conveyance,
liquidation, dissolution or winding up is expected to become effective,
the terms of such transaction, and the date as of which it is expected
that holders of Common Shares of record shall be entitled to exchange
their Common Shares for securities or other property deliverable upon
such reclassification, consolidation, merger, sale, conveyance,
liquidation, dissolution or winding up. Failure to give any such notice
or any defect therein shall not affect the validity of the proceedings
referred to in clauses (i), (ii), (iii) and (iv) above. Nothing
contained in this subsection (j) shall be deemed to adversely affect
the rights of the holders of the Series A Shares, under the Delaware
General Corporation Law or under the Certificate of Incorporation of
the Company, to be given notice of, or to vote upon, a proposal to
effect any transaction described in this subsection (j).
(k) No fractional Common Shares shall be issued upon the
conversion of Series A Shares. If more than one Series A Share shall be
surrendered for conversion at one time by the same holder, the number
of full Common Shares issuable upon conversion thereof shall be
computed on the basis of the aggregate number of Series A Shares so
surrendered. If any fractional interest in a Common Share would, except
for the provisions of this subsection (k), be deliverable upon the
conversion of any Series A Share or Shares, the Company shall, in lieu
of delivering the fractional share therefor, pay to the holder of such
surrendered Series A Share or Shares an amount in cash (computed to the
nearest cent) equal to such fractional interest multiplied by the
Market Price of a Common Share as of the close of business on the date
of conversion.
(l) The Company shall as promptly as practicable seek the
approval of its shareholders to cause its Certificate of Incorporation
to be amended to increase the number of authorized Common Shares to a
number sufficient to permit the conversion of all outstanding Series A
Shares from time to time as necessary under the circumstances. Upon any
issuance of Series A Shares, the Company shall reserve a number of
Common Shares sufficient to permit conversion of all of such Series A
Shares at such time; provided, however, that if and to the extent the
number of authorized Common Shares is not then sufficient to permit
conversion of all then issued Series A Shares, all then authorized
-12-
<PAGE> 21
but unissued Common Shares which are not otherwise reserved shall be
reserved for purposes of permitting conversion of a portion of such
Series A Shares and after approval by the Company's shareholders of an
amendment to the Company's Certificate of Incorporation increasing the
number of authorized Common Shares, the Company shall reserve such
number of newly authorized Common Shares so as to permit, immediately
following such approval, the conversion of all such Series A Shares,
and thereafter the Company shall at all times have reserved and
available out of its authorized but unissued Common Shares solely for
the purpose of issue upon conversion of the Series A Shares, as
provided in this Section 2, such number of Common Shares as shall from
time to time be sufficient to permit the conversion of all outstanding
Series A Shares. Upon the issuance thereof upon conversion, all in
accordance with the provisions of this Section 2, such Common Shares
shall be validly issued, fully paid and nonassessable. Series A Shares
converted pursuant to this Section 2 shall be cancelled and shall not
be reissued. Upon any conversion, no adjustment shall be made for
dividends on the Common Shares payable to holders of record of Common
Shares on a date prior to the date of such conversion.
(m) The issuance of certificates for Common Shares shall be
made without charge for any tax in respect of such issuance. However,
if any such certificate is to be issued in the name other than that of
the holder of the converted Series A Shares, the Company shall not be
required to issue or deliver any certificate or certificates unless (i)
the holder has paid to the Company the amount of any tax that may be
payable in respect of any transfer involved in such issuance or shall
establish to the satisfaction of the Company that such tax has been
paid and (ii) the certificate for the Series A Shares surrendered for
conversion shall be duly endorsed or accompanied by a duly executed
stock power.
(n) If the issuance of any Common Shares upon the conversion
of Series A Shares requires approval of or by any securities exchange
before such shares may be issued, and the Company determines to secure
such approval, then the Company may suspend the conversion of all
Series A Shares for the period during which it is endeavoring to secure
such approval.
3. Voting Rights. The holders of the Series A Shares shall not
have, and shall not be entitled to exercise, exercise, any voting
rights with respect to the Series A Shares, except for such voting
rights which such holders may be entitled to exercise as holders of
-13-
<PAGE> 22
a class or series of capital stock of the Company pursuant to, under or
in accordance with specific provisions of the Delaware General
Corporation Law.
4. Dividends.
(a) The holders of the Series A Shares shall be entitled to
receive out of funds legally available therefor, cumulative cash
dividends at the rate of 6% per annum of the Liquidation Value per
Series A Share ($1.1364, as adjusted for any stock split, reverse stock
split, stock dividend or similar event resulting in a change in the
Series A Shares) (the "Dividend Rate"), payable on June 30 of each year
in which any Series A Shares shall be outstanding, commencing June 30,
1987, to the holders of record of such Series A Shares on the
respective dates fixed for such purpose by the Board of Directors of
the Company in advance of payment of each dividend. Dividends on each
Series A Share shall be cumulative from the date of issue thereof. The
first dividend payable with respect to any Series A Share shall be
computed by multiplying the Dividend Rate by a fraction of which (i)
the numerator shall be the number of days from the date of issue of
such Series A Share through the date as of which such first dividend is
payable, inclusive, and (ii) the denominator shall be 360.
(b) All other equity securities of the Company, including,
without limitation, the Senior Shares, if any, and the Junior Shares,
if any, shall rank junior to the Series A Shares in the payment of
dividends.
(c) To the extent any dividend accrues on a Series A Share,
and is not fully paid in the manner specified in Section 4(a) hereof,
such dividend (or, if paid in part, the unpaid portion thereof) shall
be added to the Liquidation Value of such Series A Share and shall
remain a part of such Liquidation Value until such dividend (or unpaid
portion thereof) is paid. In addition, any such unpaid dividend shall
not result in an adjustment to the Conversion Price, and any such
unpaid dividend shall no longer be payable to a holder of such Series A
Share upon the effective date of the conversion thereof into Common
Shares.
(d) If at any time the Company pays less than the total amount
of dividends then accrued and payable with respect to the Series A
Shares, such payment shall be distributed ratably among the holders of
the Series A Shares based upon the aggregate Liquidation Value of the
Series A Shares then held by each such holder.
-14-
<PAGE> 23
(e) So long as any Series A Shares shall remain outstanding,
no dividend whatsoever (other than a dividend payable in Common Shares)
shall be declared or paid on any Junior Shares, nor shall any Junior
Shares be redeemed or purchased by the Company or any Subsidiary
thereof, nor shall any monies be paid to or made available for a
sinking fund for the redemption or purchase of any Junior Shares,
unless in each such instance full dividends on all outstanding Series A
Shares for all past dividend periods and the dividend on all
outstanding Series A Shares for the then current dividend period shall
have been paid and sufficient funds set apart therefor.
5. Definitions.
(a) As used herein, the following terms shall have the
meanings specified in the sections listed below:
<TABLE>
<CAPTION>
Term Section
---- -------
<S> <C>
Company Preamble
Conversion Price 2(c)
Convertible Securities 2(c)C(i)
Liquidation Value 1
Options 2(c)C(i)
Series A Shares Preamble
</TABLE>
(b) As used herein, the following terms shall have the
following meanings:
"Common Shares" shall mean and include the shares of Common
Stock, par value $0.10 per share, of the Company as constituted on the
date of the original issue of the Series A Shares and shall also
include any class of shares of capital stock of the Company thereafter
authorized that shall not be limited to a fixed sum or percentage in
respect of the right of the holders thereof to receive dividends or to
participate in the assets of the Company distributable to shareholders
upon any liquidation, dissolution or winding up of the Company;
provided, however, that the shares into which the Series A Shares shall
be convertible pursuant to Section 2 hereof shall mean and include,
and, as used in Section 2 hereof, the term "Common Shares" shall mean
and include, only the Common Stock, par value $0.10 per share, of the
Company as constituted on the date of the original issue of the Series
A Shares or (i) in the case of any reclassification, change,
consolidation, merger, sale or conveyance of the character referred to
in Section
-15-
<PAGE> 24
2(e) hereof, the shares or other securities or property deliverable in
lieu thereof or (ii) in the case of any change or reclassification of
the outstanding Common Shares issuable upon conversion of the Series A
Shares as a result of a subdivision or combination or consisting of a
change in par value, or from par value to no par value, or from no par
value to par value, such Common Shares as so changed or reclassified.
"Junior Shares" shall mean (i) Common Shares and (ii) all
those classes and series of preferred or special shares which, by the
terms of the Certificate of Incorporation of the Company, shall be
subordinate to the Series A Shares with respect to the right of the
holders thereof to participate in the assets of the Company
distributable to shareholders upon any liquidation, dissolution or
winding up of the Company.
"Market Price" of any security shall mean the average of the
closing prices of such security's sales on all securities exchanges on
which such security may at the time be listed, or, if there have been
no sales on any such exchange on any day, the average of the highest
bid and lowest asked prices on all such exchanges at the end of such
date, or, if on any day such security is not so listed, the average of
the representative bid and asked prices quoted in the NASDAQ System as
of 4:00 p.m., New York time, or, if on any day such security is not
quoted in the NASDAQ System, the average of the high and low bid and
asked prices on such day in the domestic over-the-counter market as
reported by the National Quotation Bureau, Inc., or any similar
successor organization, in each such case averaged over a period of 21
days consisting of the day as of which "Market Price" is being
determined and the 20 consecutive business days prior to such date. If
at any time such security is not listed on any securities exchange or
quoted in the NASDAQ System or the over-the-counter market, the "Market
Price" of such security shall be the fair value thereof determined in
good faith by the Board of Directors of the Company.
"Parity Shares" shall mean all those classes and series of
preferred or special shares which, by the terms of the Certificate of
Incorporation of the Company, shall be on a parity with the Series A
Shares with respect to the right of the holders thereof to participate
in the assets of the Company distributable to shareholders upon any
liquidation, dissolution or winding up of the Company.
"Senior Shares" shall mean all those classes and series of
preferred or special shares which, by the terms of the Certificate of
Incorporation of the Company, shall be senior to the Series A Shares
-16-
<PAGE> 25
with respect to the right of the holders thereof to participate in the
assets of the Company distributable to shareholders upon any
liquidation, dissolution or winding up of the Company.
"Subsidiary" shall mean any entity of which shares of stock or
other equity interests having at least a majority of the ordinary
voting power in electing the board of directors or similar governing
body are, at the time as of which any determination is being made,
owned by the Company either directly or indirectly through one or more
Subsidiaries.
8. Miscellaneous.
(a) If any other class or series of preferred or special
shares of the Company, whether ranking prior to or on a parity with or
junior to the Series A Shares as to dividends or assets, shall be
created, nothing herein shall prevent the holders of any such other
class or series of preferred or special shares from being given any
designations, preferences, limitations or relative rights authorized by
law and the Certificate of Incorporation of the Company, except as
otherwise expressly provided herein with respect to the foregoing
matters.
(b) All notices or other communications referred to herein,
except as otherwise expressly provided, shall be hand delivered or
given by registered or certified mail, return receipt requested,
postage prepaid, and shall be deemed to have been given when so hand
delivered or mailed.
DATED this 8th day of April, 1987.
/s/ Donald L. Evans
--------------------------
Donald L. Evans, President
/s/ James M. Alsup
-------------------------
James M. Alsup, Secretary
-17-
<PAGE> 26
CERTIFICATE OF MERGER
MERGING
TOM BROWN, INC.
A NEVADA CORPORATION
INTO
TOM BROWN, INC.
A DELAWARE CORPORATION
(Pursuant to Section 252 of the General Corporation
Law of the State of Delaware)
Tom Brown, Inc., a corporation organized under the laws of the State of
Delaware, does hereby certify that:
1. The names and states of incorporation of each of the constituent
corporations are:
<TABLE>
<CAPTION>
Name of Corporation State
------------------- -----
<S> <C>
Tom Brown, Inc. Nevada
Tom Brown, Inc. Delaware
</TABLE>
2. A Plan and Agreement of Merger has been approved, adopted,
certified, executed and acknowledged by each of the constituent corporations in
accordance with Section 252(c) of the General Corporation Law of the State of
Delaware.
3. The name of the surviving corporation is Tom Brown, Inc., a Delaware
corporation.
4. The Certificate of Incorporation of Tom Brown, Inc., a Delaware
corporation, shall be the Certificate of Incorporation of the surviving
corporation.
5. The executed Plan and Agreement of Merger is on file at the
principal place of business of the surviving corporation as follows:
Tom Brown, Inc.
500 Empire Plaza
Midland, Texas 79701
6. A copy of the Plan and Agreement of Merger will be furnished by the
surviving corporation on request and without cost, to any stockholder of any
constituent corporation.
<PAGE> 27
7. The authorized capital stock of Tom Brown Inc., Nevada, is
150,000,000 shares, of which 100,000,000 shares are common stock and 50,000,000
shares are preferred stock.
IN WITNESS WHEREOF, said Tom Brown, Inc., a Delaware corporation, has
caused this certificate to be signed by Donald L. Evans, its President, and
attested by James M. Alsup, its Secretary, this 9th day of April, 1987.
By: /s/ Donald L. Evans
---------------------------
Donald L. Evans, President
ATTEST:
/s/ James M. Alsup
-------------------------
James M. Alsup, Secretary
THE STATE OF TEXAS )
)
COUNTY OF MIDLAND )
This instrument was acknowledged before me on April 9, 1987, by Donald
L. Evans, President of Tom Brown, Inc., a Delaware corporation, on behalf of
said Corporation.
/s/ Rita K. Turner
-----------------------------
Name Rita K. Turner
-------------------------
Notary Public in and for
the State of Texas
My Commission Expires:
10/23/89
----------------------
-2-
<PAGE> 28
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
TBI MANAGEMENT, INC.
INTO
TOM BROWN, INC.,
A DELAWARE CORPORATION
(Pursuant to Sections 253 of the
General Corporation Law of the State of Delaware)
TOM BROWN, INC., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, does hereby
certify that:
1. Tom Brown, Inc. is the parent corporation of TBI Management, Inc., a
Texas corporation, and Tom Brown, Inc. owns 100% of the outstanding shares of
stock of TBI Management, Inc., and therefore is entitled to Merge TBI
Management, Inc. into Tom Brown, Inc. under the provisions of Section 253 of the
General Corporation Law of the State of Delaware.
2. The provision for making this Certificate of Ownership and Merger is
contained in the Tom Brown, Inc. Unanimous Consent of Directors, attached hereto
as Exhibit "A".
3. The names and state of incorporation of each of the constituent
corporations are:
<TABLE>
<CAPTION>
Name of Corporation State
------------------- -----
<S> <C>
TBI Management, Inc. Texas
Tom Brown, Inc. Delaware
</TABLE>
4. The name of the surviving corporation is Tom Brown, Inc., a Delaware
corporation.
5. The principal place of business of the surviving corporation is:
Tom Brown, Inc.
500 Empire Plaza
Midland, Texas 79701
Attn: Mr. Donald L. Evans
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Ownership and Merger to be signed on its behalf by its President and attested by
its Secretary this 25th day of April, 1988.
Attest: TOM BROWN, INC.
/s/ James M. Alsup By: /s/ Donald L. Evans
-------------------------- ---------------------------
James M. Alsup, Secretary Donald L. Evans, President
<PAGE> 29
EXHIBIT A
SPECIAL MEETING UNANIMOUS CONSENT
OF THE DIRECTORS OF TOM BROWN, INC.
PURSUANT TO SECTION 141(f) OF THE
GENERAL CORPORATION LAW OF
THE STATE OF DELAWARE
The undersigned, being all of the Directors of TOM BROWN, INC. (the
"Corporation"), and being entitled to vote upon the resolutions hereinafter set
forth, do hereby consent that the resolutions set forth below are deemed to be
adopted to the same extent and to have the same force and effect as if adopted
by unanimous consent in a formal meeting of the Board of Directors of the
Corporation duly called and held for the purpose of acting upon a proposal to
adopt such resolutions:
"RESOLVED, That the Corporation shall merge with its 100% owned
subsidiary corporation, TBI Management, Inc., a Texas corporation,
pursuant to the provisions of Section 253 of the General Corporation
Law of the State of Delaware and Articles 5.07B(2) and (3) and 5.16 of
the Business Corporation Act of the State of Texas.
"RESOLVED, That the officers of the Corporation shall be fully
authorized to take any actions necessary to accomplish the merger
between the Corporation and TBI Management, Inc.
"RESOLVED, That the Corporation shall be the surviving corporation in
such merger, and that TBI Management, Inc. shall cease to exist.
"RESOLVED, That such merger shall be effective as of April 25, 1988."
ADOPTED April 25, 1988.
/s/ Thomas C. Brown
--------------------------------
Thomas C. Brown, Director
/s/ Donald L. Evans
--------------------------------
Donald L. Evans, Director
/s/ Edward W. LeBaron, Jr.
--------------------------------
Edward W. LeBaron, Jr., Director
/s/ Joe G. Roper
--------------------------------
Joe G. Roper, Director
-2-
<PAGE> 30
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
GENERAL RESOURCES, INC.
INTO
TOM BROWN, INC.,
A DELAWARE CORPORATION
(Pursuant to Sections 253 of the
General Corporation Law of the State of Delaware)
TOM BROWN, INC., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, does hereby
certify that:
1. Tom Brown, Inc. is the parent corporation of General Resources,
Inc., a Texas corporation, and Tom Brown, Inc. owns 100% of the outstanding
shares of stock of General Resources, Inc., and therefore is entitled to merge
General Resources, Inc. into Tom Brown, Inc. under the provisions of Section 253
of the General Corporation Law of the State of Delaware.
2. The provision for making this Certificate of Ownership and Merger is
contained in the Tom Brown, Inc. Unanimous Consent of Directors, attached hereto
as Exhibit A.
3. The names and state of incorporation of each of the constituent
corporations are:
<TABLE>
<CAPTION>
Name of Corporation State
------------------- -----
<S> <C>
General Resources, Inc. Texas
Tom Brown, Inc. Delaware
</TABLE>
4. The name of the surviving corporation is Tom Brown, Inc., a Delaware
corporation.
5. The principal place of business of the surviving corporation is:
Tom Brown, Inc.
500 Empire Plaza
Midland, Texas 79701
Attn: Mr. Donald L. Evans
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Ownership and Merger to be signed on its behalf by its President and attested by
its Secretary this 25th day of April, 1988.
Attest: TOM BROWN, INC.
/s/ James M. Alsup By: /s/ Donald L. Evans
-------------------------- -------------------------------------
James M. Alsup, Secretary Donald L. Evans, President
<PAGE> 31
EXHIBIT A
SPECIAL MEETING UNANIMOUS CONSENT
OF THE DIRECTORS OF TOM BROWN, INC.
PURSUANT TO SECTION 141(f) OF THE
GENERAL CORPORATION LAW OF
THE STATE OF DELAWARE
The undersigned, being all of the Directors of TOM BROWN, INC. (the
"Corporation"), and being entitled to vote upon the resolutions hereinafter set
forth, do hereby consent that the resolutions set forth below are deemed to be
adopted to the same extent and to have the same force and effect as if adopted
by unanimous consent in a formal meeting of the Board of Directors of the
Corporation duly called and held for the purpose of acting upon a proposal to
adopt such resolutions:
"RESOLVED, That the Corporation shall merge with its 100% owned
subsidiary corporation, General Resources, Inc., a Texas corporation,
pursuant to the provisions of Section 253 of the General Corporation
Law of the State of Delaware and Articles 5.07B(2) and (3) and 5.16 of
the Business Corporation Act of the State of Texas.
"RESOLVED, That the officers of the Corporation shall be fully
authorized to take any actions necessary to accomplish the merger
between the Corporation and General Resources, Inc.
"RESOLVED, That the Corporation shall be the surviving corporation in
such merger, and that General Resources, Inc. shall cease to exist.
"RESOLVED, That such merger shall be effective as of April 25, 1988."
ADOPTED April 25, 1988.
/s/ Thomas C. Brown
--------------------------------
Thomas C. Brown, Director
/s/ Donald L. Evans
--------------------------------
Donald L. Evans, Director
/s/ Edward W. LeBaron, Jr.
--------------------------------
Edward W. LeBaron, Jr., Director
/s/ Joe G. Roper
--------------------------------
Joe G. Roper, Director
-2-
<PAGE> 32
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION
OF
TOM BROWN, INC.
Tom Brown, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation") does hereby certify
as follows:
FIRST: Pursuant to the provisions of the Delaware General Corporation
Law, the Board of Directors and the stockholders of the Corporation adopted an
amendment to the Certificate of Incorporation of the Corporation, which is set
forth in the following resolution in accordance with Section 242 of the Delaware
General Corporation Law, the purpose of which amendment is to effect a
one-for-twenty reverse stock split:
"RESOLVED, That the Certificate of Incorporation of the Corporation be
amended by changing Paragraph Fourth thereof, so that as amended, said
Paragraph Fourth shall read as follows:
FOURTH: The total number of shares of all classes that the
Corporation shall have authority to issue is 12,500,000, of
which 2,500,000 shares shall be Preferred Stock, par value
$.10 per share, and 10,000,000 shares shall be Common Stock,
$.10 par value per share. All of such shares shall, upon
issuance thereof, be fully paid and nonassessable.
The designations, preferences, limitations and relative rights
of the shares of each class that the Corporation shall have
authority to issue are as follows:
A. Preferred Stock. The Board of Directors is hereby
expressly vested with the authority to adopt a
resolution or resolutions providing for the issue of
authorized but unissued shares of Preferred Stock,
which shares may be issued from time to time in one
or more series and in such amounts as may be
determined by the Board of Directors in such
resolution or resolutions. The designations,
preferences, limitations or relative rights of the
Preferred Stock and the qualifications, limitations
or restrictions, if any, of such preferences and/or
rights (collectively, the "Series Terms") may vary
between series in any and all respects and shall be
such as are stated and expressed in a resolution or
resolutions providing for the creation or revision of
such Series Terms set forth in a Certificate of
<PAGE> 33
Designations (a "Preferred Stock Series Resolution")
adopted by the Board of Directors; provided that all
shares of any one series of Preferred Stock so
designated by the Board of Directors shall be
identical in all respects except that shares of any
one series issued at different times may differ as to
the dates from which dividends thereon may be
cumulative. The powers of the Board of Directors with
respect to the Series Terms of a particular series
shall include, but not be limited to, determination
of the following:
1. The right to receive dividends, if any, and
the rate, dates, terms and other conditions
on which such dividends shall be payable;
2. The nature of the dividend payable, if any,
with respect to shares of such series as
cumulative, non-cumulative or partially
cumulative;
3. The redemption rights of such series
including the price at and the terms and
conditions on which such shares may be
redeemed;
4. The amount payable upon shares in the event
of involuntary liquidation;
5. The amount payable upon shares in the event
of voluntary liquidation;
6. Sinking fund provisions for the redemption
or purchase of shares;
7. The terms and conditions on which shares may
be converted, if the shares of any series
are issued with the privilege of conversion;
8. Voting rights, if any; and
9. Repurchase obligations of the Corporation
with respect to the shares of each series.
-2-
<PAGE> 34
Any of the Series Terms, including voting rights, of
any series may be made dependent upon facts
ascertainable out-side this Certificate of
Incorporation and the Preferred Stock Series
Resolution, provided that the manner in which such
facts shall operate upon such Series Terms is clearly
and expressly set forth herein or in the Preferred
Stock Series Resolution.
Subject to the provisions of this Paragraph Fourth,
shares of one or more series of Preferred Stock may
be authorized or issued from time to time as shall be
determined by and for such consideration as shall be
fixed by the Board of Directors, in an aggregate
amount not exceeding the total number of shares of
Preferred Stock authorized herein. Except in respect
of Series Terms fixed by the Board of Directors as
permitted hereby, all shares of Preferred Stock shall
be of equal rank and shall be identical.
B. Common Stock.
1. Dividends. Subject to the pro-visions of any
Preferred Stock Series Resolution, the Board
of Directors may, in its discretion, out of
funds legally available for the payment of
dividends and at such times and in such
manner as determined by the Board of
Directors, declare and pay dividends on the
Common Stock of the Corporation.
No dividend (other than a dividend in
capital stock ranking on a parity with the
Common Stock or cash in lieu of fractional
shares with respect to such stock dividend)
shall be declared or paid on any share or
shares of any class of stock or series
thereof ranking on a parity with the Common
Stock in respect of payment of dividends for
any dividend period unless there shall have
been declared, for the same dividend period,
like proportionate dividends on all shares
of Common Stock then outstanding.
-3-
<PAGE> 35
2. Liquidation. In the event of any
liquidation, dissolution or winding up of
the Corporation, whether voluntary or
involuntary, after payment or provision for
payment of the debts and other liabilities
of the Corporation and after payment of any
preferential amount due to the holders of
any other class or series of stock, the
holders of the Common Stock shall be
entitled to receive ratably any or all
assets remaining to be paid or distributed.
3. Voting Rights. Subject to any special voting
rights set forth in any Preferred Stock
Series Resolution, the holders of the Common
Stock of the Corporation shall be entitled
at all meetings of shareholders to one vote
for each share of such stock held by them.
C. Prior, Parity or Junior Stock. Whenever reference is
made in this Paragraph Fourth or in any Preferred
Stock Series Resolution to shares "ranking prior to"
another class or series of stock or "on a parity
with" another class or series of stock, such
reference shall mean and include all other shares of
the Corporation in respect of which the rights of the
holders thereof as to the payment of dividends or as
to distributions in the event of a voluntary or
involuntary liquidation, dissolution or winding up of
the affairs of the Corporation are given preference
over, or rank on an equality with, as the case may
be, the rights of the holders of such other class or
series of stock. Whenever reference is made to shares
"ranking junior to" another class of stock, such
reference shall mean and include all shares of the
Corporation in respect of which the rights of the
holders thereof as to the payment of dividends and as
to distributions in the event of a voluntary or
involuntary liquidation, dissolution or winding up of
the affairs of the Corporation are junior and
subordinate to the rights of the holders of such
class or series of stock.
-4-
<PAGE> 36
Except as otherwise provided herein or in any
Preferred Stock Series Resolution, each series of
Preferred Stock ranks on a parity with each other
series and each series ranks prior to the Common
Stock. Common Stock ranks junior to the Preferred
Stock.
D. Liquidation. For the purposes of Section (2) of
Section B of this Paragraph Fourth and for the
purpose of the comparable sections of any Preferred
Stock Series Resolution, the merger or consolidation
of the Corporation into or with any other
corporation, or the merger of any other corporation
into it, or the sale, lease or conveyance of all or
substantially all the assets, property or business of
the Corporation, shall not be deemed to be a
liquidation, dissolution or winding up of the
Corporation.
E. Reservation and Retirement of Shares. The Corporation
shall at all times reserve and keep available, out of
its authorized but unissued shares of Common Stock or
out of shares of Common Stock held in its treasury,
the full number of shares of Common Stock into which
all shares of any series of Preferred Stock having
conversion privileges from time to time outstanding
are convertible.
Unless otherwise provided in a Preferred Stock Series
Resolution with respect to a particular series of
Preferred Stock, all shares of Preferred Stock
redeemed or acquired (as a result of conversion or
otherwise) shall be retired and restored to the
status of authorized but unissued shares.
F. Preemptive Rights.
1. No holder of shares of Preferred Stock or
Common Stock of the Corporation shall have
any preemptive right to purchase or
subscribe for or receive any shares of any
class, or series thereof, of stock of the
Corporation, whether now or hereafter
authorized, or any warrants, options, bonds,
debentures or other securities
-5-
<PAGE> 37
convertible into, exchangeable for or
carrying any right to purchase any shares of
any class, or series thereof, of stock; but
such additional shares of stock and such
warrants, options, bonds, debentures or
other securities convertible into,
exchangeable for or carrying any right to
purchase any shares of any class, or series
thereof, of stock may be issued or disposed
of by the Board of Directors to such
persons, and on such terms and for such
lawful consideration, as in its discretion
it shall deem advisable.
2. The stockholders of the Corporation shall
have no rights to acquire the shares of
Common Stock of the Corporation now held in
the treasury of the Corporation or any
shares of Common Stock of the Corporation
hereafter acquired by the Corporation and
held as treasury shares.
G. No Cumulative Voting. Cumulative voting shall not be
allowed in the election of Directors or for any other
purpose.
H. Repurchases of Capital Stock. The Corporation may,
without shareholder approval, purchase, directly or
indirectly, its own shares to the extent permitted by
the Delaware General Corporation Law."
SECOND: Pursuant to the provisions of the Delaware General Corporation
Law, the Board of Directors and the stockholders of the Corporation adopted an
amendment to the Certificate of Designations, Preferences and Rights of Serial
Preferred Stock Series A Non-Voting Convertible 6% Cumulative Preferred Stock
filed April 9, 1987 with the Delaware Secretary of State and authorizing the
creation and issuance of an aggregate of 22,000,000 shares of Series A
Non-Voting Convertible 6% Cumulative Preferred Stock, which is set forth in the
following resolution in accordance with Section 242 of the Delaware General
Corporation Law, the purpose of which amendment is to effect a one-for-twenty
reverse stock split:
"RESOLVED, That the Certificate of Designations, Preferences and Rights
of Serial Preferred Stock - Series A Non-Voting Convertible.6%
Cumulative Preferred Stock filed with the Delaware Secretary of State
on April 9, 1987, be amended by changing the
-6-
<PAGE> 38
first paragraph of the resolution creating the series of serial
preferred stock designated as the Series A Non-Voting Convertible 6%
Cumulative Preferred Stock, so that as amended, said paragraph shall
read as follows:
"RESOLVED, That the Board of Directors of Tom Brown,
Inc. (the "Company"), in the exercise of its best
business judgment and intending to act in full
compliance with the applicable provisions of the
Company's Certificate of Incorporation and Bylaws and
the provisions of the Delaware General Corporation
Law, hereby establishes a series of Preferred Stock,
par value $0.10 per share, of the Company designated
as "Series A Non-Voting Convertible 6% Cumulative
Preferred Stock" (the "Series A Shares"), and the
number of Series A Shares which the Company is
authorized to issue from time to time shall be
1,100,000 and the designations, preferences,
limitations, and relative rights, and qualifications,
limitations and restrictions, of the Series A Shares
shall be as follows:"
"RESOLVED, That the Certificate of Designations, Preferences and Rights
of Serial Preferred Stock - Series A Non-Voting Convertible 6%
Cumulative Preferred Stock filed with the Delaware Secretary of State
on April 9, 1987, be further amended by changing the numbered paragraph
1 thereof, so that as amended, said paragraph 1 shall read as follows:
1. Liquidation. The Series A Shares shall be preferred as to
assets over Junior Shares so that, in the event of the
voluntary or involuntary liquidation, dissolution or winding
up of the Company, the holders of the Series A Shares shall be
entitled, in conjunction with any provision then being made
for the holders of Parity Shares, if any, to have set apart
for them or to be paid out of the assets of the Company, after
payment or provision for payment of the debts and other
liabilities of the Company and after provision for the holders
of Senior Shares, if any, but before any distribution is made
to or set apart for the holders of Junior Shares, an amount in
cash equal to $22.7280 per Series A Share (as adjusted for any
stock split, reverse stock split, stock dividend or similar
event resulting in a change in the Series A Shares) (the
"Liquidation Value"), together with all dividends accrued on
such Series A
-7-
<PAGE> 39
Shares to the date of payment, irrespective of whether such
dividends were earned, declared or legally available, and the
holders of the Series A Shares shall not be entitled to any
further payment in connection with the voluntary or
involuntary liquidation, dissolution or winding up of the
Company except as expressly provided for in this resolution.
If, upon such liquidation, dissolution or winding up of the
Company, the assets of the Company available for distribution
to the holders of the Series A Shares and the holders of
Parity Shares, if any, shall be insufficient to permit the
distribution in full of the amounts receivable as aforesaid by
the holders of the Series A Shares and the amounts receivable
by the holders of Parity Shares, if any, then all such assets
of the Company shall be distributed ratably among the holders
of the Series A Shares and the holders of Parity Shares, if
any, in proportion to the amounts that each would have been
entitled to receive if such assets were sufficient to permit
distribution in full as aforesaid. Neither the consolidation
or merger of the Company with or into any corporation or
corporations, nor the sale, lease or transfer by the Company
of all or any part of its assets, nor the reduction of the
authorized or issued shares of the Company of any class,
whether now or hereafter authorized, shall be deemed to be a
liquidation, dissolution or winding up of the Company for the
purposes of this Section 1. Written notice of any voluntary or
involuntary liquidation, dissolution or winding up of the
Company, setting the payment date and the place where the
amounts to be distributed shall be paid and containing a
reference to the conversion option granted by Section 2
hereof, shall be given not less than thirty (30) days prior to
the payment date stated therein to the holders of record of
the Series A Shares at their respective addresses as the same
shall appear on the stock ledger of the Company."
"RESOLVED, That the Certificate of Designations, Preferences and Rights
of Serial Preferred Stock - Series A Non-Voting Convertible 6%
Cumulative Preferred Stock filed with the Delaware Secretary of State
on April 9, 1987, be further amended by changing the numbered paragraph
2(a) thereof, so that as amended, said paragraph 2(a) shall read as
follows:
-8-
<PAGE> 40
2. Conversion.
(a) Subject to the terms and conditions of this
Section 2, the Series A Shares shall be convertible, at any
time and from time to time, at the option of the holder
thereof, into Common Shares by surrender of the certificate or
certificates for the Series A Shares to be so converted, duly
endorsed, at the principal office of the Company (or at such
other place or places as may be designated by the Company from
time to time by notice sent to the holders of the Series A
Shares at their respective addresses as the same shall appear
on the stock ledger of the Company) or at the corporate trust
office of any transfer agent for the Series A Shares at any
time during normal business hours, together with notice that
the holder elects to convert such Series A Shares, or a stated
number of such shares, in accordance with the provisions of
this Section 2. Such notice shall also state the name or names
(with addresses) in which the certificate or certificates for
Common Shares shall be issued. The number of Common Shares
that any such holder shall receive in return for each Series A
Share converted by such holder shall be computed by dividing
(x) $22.7280 (as adjusted for any stock split, reverse stock
split, stock dividend or similar event resulting in a change
in the Series A Shares) by (y) the Conversion Price then in
effect."
"RESOLVED, That the Certificate of Designations, Preferences and Rights
of Serial Preferred Stock - Series A Non-Voting Convertible 6%
Cumulative Preferred Stock filed with the Delaware Secretary of State
on April 9, 1987, be further amended by changing the first sentence of
paragraph 2(c) thereof, so that as amended, said sentence shall read as
follows:
2.(c) The initial Conversion Price shall be
$5.6820."
"RESOLVED, That the Certificate of Designations, Preferences and Rights
of Serial Preferred Stock - Series A Non-Voting Convertible 6%
Cumulative Preferred Stock filed with the Delaware Secretary of State
on April 9, 1987, be amended by changing the numbered paragraph 4(a)
thereof, so that as amended, said paragraph 4(a) shall read as follows:
-9-
<PAGE> 41
4. Dividends.
(a) The holders of the Series A Shares shall be
entitled to receive out of funds legally available therefor,
cumulative cash dividends at the rate of 6% per annum of the
Liquidation Value per Series A Share ($22.7280, as adjusted
for any stock split, reverse stock split, stock dividend or
similar event resulting in a change in the Series A Shares)
(the "Dividend Rate"), payable on June 30 of each year in
which any Series A Shares shall be outstanding, commencing
June 30, 1987, to the holders of record of such Series A
Shares on the respective dates fixed for such purpose by the
Board of Directors of the Company in advance of payment of
each dividend. Dividends on each Series A Share shall be
cumulative from the date of issue thereof. The first dividend
payable with respect to any Series A Share shall be computed
by multiplying the Dividend Rate by a fraction of which (i)
the numerator shall be the number of days from the date of
issue of such Series A Share through the date as of which such
first dividend is payable, inclusive, and (ii) the denominator
shall be 360."
Upon the filing in the Office of the Secretary of State of Delaware of
this Certificate of Amendment, each twenty issued and outstanding shares of
common stock shall thereby and thereupon be combined into one share of common
stock and each twenty issued and outstanding shares of Series A Non-Voting
Convertible 6% Cumulative preferred stock shall thereupon be combined into one
share of Series A Non-Voting Convertible 6% Cumulative preferred stock. Each
certificate that theretofore represented shares of common stock prior to the
filing of this Certificate of Amendment shall thereafter represent the number of
shares of common stock into which the shares of common stock represented by such
certificate shall be combined, and each certificate that theretofore represented
shares of Series A Non-Voting Convertible 6% Cumulative preferred stock prior to
the filing of this Certificate of Amendment shall thereafter represent the
number of shares of Series A Non-Voting Convertible 6% Cumulative preferred
stock into which the shares of Series A Non-Voting Convertible 6% Cumulative
preferred stock represented by such certificate shall be combined. To the extent
a shareholder holds a number of shares of common stock not evenly divisible by
twenty, such shareholder will receive cash for each fractional interest
resulting from such division.
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Amendment to be signed by Thomas C. Brown, its Chairman of the Board of
Directors, and attested by Regina Neill, its Assistant Secretary, this 7th day
of September, 1988.
-10-
<PAGE> 42
TOM BROWN, INC.
/s/ Thomas C. Brown
----------------------------
Thomas C. Brown, Chairman of
the Board of Directors
ATTESTED:
/s/ Regina Neill
-----------------------
Regina Neill, Assistant
Secretary
The undersigned Chairman of the Board of Directors of Tom Brown, Inc.,
being duly sworn, does verify that the foregoing instrument represents the act
and deed of Tom Brown, Inc. and that the facts stated in such instrument are
true.
/s/ Thomas C. Brown
----------------------------
Thomas C. Brown, Chairman of
the Board of Directors
-11-
<PAGE> 43
THE STATE OF TEXAS )
)
COUNTY OF MIDLAND )
Before me, the undersigned authority, on this day personally appeared
THOMAS C. BROWN and REGINA NEILL, Chairman of the Board of Directors and
Assistant Secretary, respectively, of Tom Brown, Inc., a corporation formed
under the laws of the State of Delaware, known to me to be the individuals whose
names are subscribed to the foregoing instrument, and acknowledged and swore to
me that they each executed the same for the purposes and consideration therein
expressed and as the act and deed of said corporation and that the facts stated
in the foregoing instrument are true.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 7th day of September, 1988.
/s/ Rita K. Turner
------------------------
Name Rita K. Turner
--------------------
Notary Public in and for
the State of Texas
Commission Expires:
10/23/89
----------------
-12-
<PAGE> 44
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION
OF
TOM BROWN, INC.
Tom Brown, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), does hereby
certify as follows:
Pursuant to the provisions of the Delaware General Corporation Law, the
Board of Directors and the stockholders of the Corporation adopted an amendment
to the Certificate of Incorporation of the Corporation, which is set forth in
the following resolution in accordance with Section 242 of the Delaware General
Corporation Law, the purpose of which amendment is to increase the number of
authorized shares of Common Stock:
"RESOLVED, That the Certificate of Incorporation of the Corporation be
amended by changing Paragraph Fourth thereof, so that as amended, said
Paragraph Fourth shall read as follows:
FOURTH: The total number of shares of all classes that the
Corporation shall have authority to issue is 22,500,000, of
which 2,500,000 shares shall be Preferred Stock, par value
$.10 per share, and 20,000,000 shares shall be Common Stock,
$.10 par value per share. All of such shares shall, upon
issuance thereof, be fully paid and nonassessable.
The designations, preferences, limitations and relative rights
of the shares of each class that the Corporation shall have
authority to issue are as follows:
A. Preferred Stock. The Board of Directors is hereby
expressly vested with the authority to adopt a
resolution or resolutions providing for the issue of
authorized but unissued shares of Preferred Stock,
which shares may be issued from time to time in one
or more series and in such amounts as may be
determined by the Board of Directors in such
resolution or resolutions. The designations,
preferences, limitations or relative rights of the
Preferred Stock and the qualifications, limitations
or restrictions, if any, of such preferences and/or
rights (collectively, the "Series Terms") may vary
between series in any and all respects and shall be
such as are stated and expressed in a resolution or
resolutions providing for the creation or revision
<PAGE> 45
of such Series Terms set forth in a Certificate of
Designations (a "Preferred Stock Series Resolution")
adopted by the Board of Directors; provided that all
shares of any one series of Preferred Stock so
designated by the Board of Directors shall be
identical in all respects except that shares of any
one series issued at different times may differ as to
the dates from which dividends thereon may be
cumulative. The powers of the Board of Directors with
respect to the Series Terms of a particular series
shall include, but not be limited to, determination
of the following:
1. The right to receive dividends, if any, and
the rate, dates, terms and other conditions
on which such dividends shall be payable;
2. The nature of the dividend payable, if any,
with respect to shares of such series as
cumulative, non-cumulative or partially
cumulative;
3. The redemption rights of such series
including the price at and the terms and
conditions on which such shares may be
redeemed;
4. The amount payable upon shares in the event
of involuntary liquidation;
5. The amount payable upon shares in the event
of voluntary liquidation;
6. Sinking fund provisions for the redemption
or purchase of shares;
7. The terms and conditions on which shares may
be converted, if the shares of any series
are issued with the privilege of conversion;
8. Voting rights, if any; and
9. Repurchase obligations of the Corporation
with respect to the shares of each series.
-2-
<PAGE> 46
Any of the Series Terms, including voting rights, of
any series may be made dependent upon facts
ascertainable outside this Certificate of
Incorporation and the Preferred Stock Series
Resolution, provided that the manner in which such
facts shall operate upon such Series Terms is clearly
and expressly set forth herein or in the Preferred
Stock Series Resolution.
Subject to the provisions of this Paragraph Fourth,
shares of one or more series of Preferred Stock may
be authorized or issued from time to time as shall be
determined by and for such consideration as shall be
fixed by the Board of Directors, in an aggregate
amount not exceeding the total number of shares of
Preferred Stock authorized herein. Except in respect
of Series Terms fixed by the Board of Directors as
permitted hereby, all shares of Preferred Stock shall
be of equal rank and shall be identical.
B. Common Stock.
1. Dividends. Subject to the provisions of any
Preferred Stock Series Resolution, the Board
of Directors may, in its discretion, out of
funds legally available for the payment of
dividends and at such times and in such
manner as determined by the Board of
Directors, declare and pay dividends on the
Common Stock of the Corporation.
No dividend (other than a dividend in
capital stock ranking on a parity with the
Common Stock or cash in lieu of fractional
shares with respect to such stock dividend)
shall be declared or paid on any share or
shares of any class of stock or series
thereof ranking on a parity with the Common
Stock in respect of payment of dividends for
any dividend period unless there shall have
been declared, for the same dividend period,
like proportionate dividends on all shares
of Common Stock then outstanding.
-3-
<PAGE> 47
2. Liquidation. In the event of any
liquidation, dissolution or winding up of
the Corporation, whether voluntary or
involuntary, after payment or provision for
payment of the debts and other liabilities
of the Corporation and after payment of any
preferential amount due to the holders of
any other class or series of stock, the
holders of the Common Stock shall be
entitled to receive ratably any or all
assets remaining to be paid or distributed.
3. Voting Rights. Subject to any special voting
rights set forth in any Preferred Stock
Series Resolution, the holders of the Common
Stock of the Corporation shall be entitled
at all meetings of shareholders to one vote
for each share of such stock held by them.
C. Prior, Parity or Junior Stock. Whenever reference is
made in this Paragraph Fourth or in any Preferred
Stock Series Resolution to shares "ranking prior to"
another class or series of stock or "on a parity
with" another class or series of stock, such
reference shall mean and include all other shares of
the Corporation in respect of which the rights of the
holders thereof as to the payment of dividends or as
to distributions in the event of a voluntary or
involuntary liquidation, dissolution or winding up of
the affairs of the Corporation are given preference
over, or rank on an equality with, as the case may
be, the rights of the holders of such other class or
series of stock. Whenever reference is made to shares
"ranking junior to" another class of stock, such
reference shall mean and include all shares of the
Corporation in respect of which the rights of the
holders thereof as to the payment of dividends and as
to distributions in the event of a voluntary or
involuntary liquidation, dissolution or winding up of
the affairs of the Corporation are junior and
subordinate to the rights of the holders of such
class or series of stock.
-4-
<PAGE> 48
D. Liquidation. For the purposes of Section (2) of
Section B of this Paragraph Fourth and for the
purpose of the comparable sections of any Preferred
Stock Series Resolution, the merger or consolidation
of the Corporation into or with any other
corporation, or the merger of any other corporation
into it, or the sale, lease or conveyance of all or
substantially all the assets, property or business of
the Corporation, shall not be deemed to be a
liquidation, dissolution or winding up of the
Corporation.
E. Reservation and Retirement of Shares. The Corporation
shall at all times reserve and keep available, out of
its authorized but unissued shares of Common Stock or
out of shares of Common Stock held in its treasury,
the full number of shares of Common Stock into which
all shares of any series of Preferred Stock having
conversion privileges from time to time outstanding
are convertible.
Unless otherwise provided in a Preferred Stock Series
Resolution with respect to a particular series of
Preferred Stock, all shares of Preferred Stock
redeemed or acquired (as a result of conversion or
otherwise) shall be retired and restored to the
status of authorized but unissued shares.
F. Preemptive Rights.
1. No holder of shares of Preferred Stock or
Common Stock of the Corporation shall have
any preemptive right to purchase or
subscribe for or receive any shares of any
class, or series thereof, of stock of the
Corporation, whether now or hereafter
authorized, or any warrants, options, bonds,
debentures or other securities convertible
into, exchangeable for or carrying any right
to
-5-
<PAGE> 49
purchase any shares of any class, or series
thereof, of stock; but such additional
shares of stock and such warrants, options,
bonds, debentures or other securities
convertible into, exchangeable for or
carrying any right to purchase any shares of
any class, or series thereof, of stock may
be issued or disposed of by the Board of
Directors to such persons, and on such terms
and for such lawful consideration, as in its
discretion it shall deem advisable.
2. The stockholders of the Corporation shall
have no rights to acquire the shares of
Common Stock of the Corporation now held in
the treasury of the Corporation or any
shares of Common Stock of the Corporation
hereafter acquired by the Corporation and
held as treasury shares.
G. No Cumulative Voting. Cumulative voting shall not be
allowed in the election of Directors or for any other
purpose.
H. Repurchases of Capital Stock. The Corporation may,
without shareholder approval, purchase, directly or
indirectly, its own shares to the extent permitted by
the Delaware General Corporation Law."
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Amendment to be signed by Donald L. Evans, its Chairman of the Board of
Directors, and attested by Kim Harris, its Assistant Secretary, this 1st day of
June, 1990.
TOM BROWN, INC.
By: /s/ Donald L. Evans
-------------------------
Donald L. Evans, Chairman
of the Board of Directors
ATTESTED:
/s/ Kim Harris
------------------------
Kim Harris, Assistant
Secretary
-6-
<PAGE> 50
The undersigned Chairman of the Board of Directors of Tom Brown, Inc.,
being duly sworn, does verify that the foregoing instrument represents the act
and deed of Tom Brown, Inc. and that the facts stated in such instrument are
true.
/s/ Donald L. Evans
----------------------------
Donald L. Evans, Chairman of
the Board of Directors
STATE OF TEXAS )
)
COUNTY OF MIDLAND )
Before me, the undersigned authority, on this day personally appeared
DONALD L. EVANS and KIM HARRIS, Chairman of the Board of Directors and Assistant
Secretary, respectively, of Tom Brown, Inc., a corporation formed under the laws
of the State of Delaware, known to me to be the individuals whose names are
subscribed to the foregoing instrument, and acknowledged and swore to me that
they each executed the same for the purposes and consideration therein expressed
and as the act and deed of said corporation and that the facts stated in the
foregoing instrument are true.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 1st day of June, 1990.
My Commission Expires:
/s/ Carolyn Vannoy
-----------------------------
10/27/92 Name: Carolyn Vannoy
-------------- ------------------------
Notary Public in and for
the State of Texas
-7-
<PAGE> 51
CERTIFICATE OF DESIGNATION,
RIGHTS AND PREFERENCES
of
SERIES B PREFERRED STOCK, $.10 PAR VALUE
of
TOM BROWN, INC.
Tom Brown, Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:
That at a meeting of the Board of Directors of Tom Brown, Inc. the
following resolution, creating a series of three hundred thousand (300,000)
shares of Preferred Stock, designated as Series B Preferred Stock, was duly
adopted pursuant to the authority granted to and vested in the Board of
Directors of this corporation in accordance with the provisions of its
Certificate of Incorporation, as amended:
RESOLVED, that a series of Preferred Stock, $.10 par value, of
the corporation be, and it hereby is, created and that the designation
and amount thereof and the preferences and relative, participating,
optional and other special rights, and the qualifications, limitations
and restrictions thereof (in addition to the provisions set forth in
the Certificate of Incorporation, as amended, of the corporation, which
are applicable to the Preferred Stock of all classes and series) are as
follows:
I. Designation and Amount. The shares of such series shall be
designated as the "Series B Preferred Stock" (the "Series B Preferred
Stock") and the number of shares constituting such series shall be
three hundred thousand (300,000). Such number of shares may be
increased or decreased by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series
B Preferred Stock to a number less than that of the shares then
outstanding plus the number of shares issuable upon exercise of
outstanding rights, options or warrants or upon conversion of
outstanding securities issued by the corporation.
II. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock ranking
prior and superior to the shares of Series B Preferred Stock
with respect to dividends, the holders of shares of Series B
Preferred Stock, in preference to the holders of common stock,
$.10 par value, of the corporation (the "Common Stock") and of
any other stock ranking junior (as to dividends) to Series B
Preferred Stock, shall be entitled to receive, when, as and if
<PAGE> 52
declared by the Board of Directors out of funds legally
available for the purpose, cumulative quarterly dividends
payable in cash or in kind, as hereinafter provided, on the
last day of March, June, September and December in each year
(each such date being referred to herein as a "Quarterly
Dividend Payment Date"), commencing on the first Quarterly
Dividend Payment Date after the first issuance of a share or
fraction of a share of Series B Preferred Stock, in an amount
per share (rounded to the nearest cent) equal to the greater
of (a) $1.00 (payable in cash) or (b) subject to the provision
for adjustment hereinafter set forth, 100 times the aggregate
per share amount (payable in cash) of all cash dividends, and
100 times the aggregate per share amount (payable in kind) of
all non_cash dividends or other distributions, other than a
dividend payable in shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock
since the immediately preceding Quarterly Dividend Payment
Date or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a
share of Series B Preferred Stock. If the corporation shall at
any time declare or pay any dividend on Common Stock payable
in shares of Common Stock or effect a subdivision or
combination of the outstanding shares of Common Stock (by
reclassification or otherwise), into a greater or lesser
number of shares of Common Stock, then in each such case the
amount to which holders of Series B Preferred Stock were
entitled immediately prior to such event under clause (b) of
the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of
Common Stock that was outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or
distribution on the Series B Preferred Stock as provided in
paragraph (A) of this Section immediately after it declares a
dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock); provided that, if
no dividend or distribution shall have been declared on the
Common Stock during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend
Payment Date, a dividend of $1.00 per share on the Series B
Preferred Stock shall nevertheless accrue and be cumulative on
the outstanding shares of Series B Preferred Stock as provided
in paragraph (C) of this Section.
-2-
<PAGE> 53
(C) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series B Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of
issue of such shares of Series B Preferred Stock, unless the
date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date
of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series B
Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of
which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid
on the shares of Series B Preferred Stock in an amount less
than the total amount of such dividends at the time accrued
and payable on such shares shall be allocated pro rata on a
share by share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for
the determination of holders of shares of Series B Preferred
Stock entitled to receive a payment of a dividend or
distribution declared thereon, which record date shall be not
more than 60 days prior to the date fixed for the payment
thereof.
III. Voting Rights. The holders of shares of Series B
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series B Preferred Stock
shall entitle the holder thereof to 100 votes on all matters
submitted to a vote of the share-holders of the corporation.
If the corporation shall at any time declare or pay any
dividend on Common Stock payable in shares of Common Stock, or
effect a subdivision or combination of the outstanding shares
of Common Stock (by reclassification or otherwise) into a
greater or lesser number of shares of Common Stock, then in
each such case the number of votes per share to which holders
of shares of Series B Preferred Stock were entitled
immediately prior to such event shall be adjusted by
multiplying such number by a fraction the numerator of which
is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding
immediately prior to such event.
-3-
<PAGE> 54
(B) Except as otherwise provided in the Certificate
of Incorporation or by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common Stock
shall vote together as one class on all matters submitted to a
vote of shareholders of the corporation.
IV. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends
or distributions payable on the Series B Preferred Stock as
provided in Section II are in arrears, thereafter and until
all accrued and unpaid dividends and distributions, whether or
not declared, on shares of Series B Preferred Stock
outstanding shall have been paid in full, the corporation
shall not:
(i) declare or pay dividends on, make any
other distributions on, or redeem or purchase or
otherwise acquire for consideration any shares of
stock ranking junior (as to dividends) to the Series
B Preferred Stock;
(ii) declare or pay dividends on or make any
other distributions on any shares of stock ranking on
a parity (as to dividends) with the Series B
Preferred Stock, except dividends paid ratably on the
Series B Preferred Stock and all such parity stock on
which dividends are payable or in arrears in
proportion to the total amounts to which the holders
of all such shares are then entitled; or
(iii) purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock,
or any shares of stock ranking on a parity (as to
dividends) with the Series B Preferred Stock, except
in accordance with a purchase offer made in writing
or by publication (as determined by the Board of
Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration
of the respective annual dividend rates and other
relative rights and preferences of the respective
series and classes, shall determine in good faith
will result in fair and equitable treatment among the
respective series or classes.
-4-
<PAGE> 55
(B) The corporation shall not permit any subsidiary
of the corporation to purchase or otherwise acquire for
consideration any shares of stock of the corporation unless
the corporation could, under paragraph (A) of this Section IV,
purchase or otherwise acquire such shares at such time and in
such manner.
V. Reacquired Shares. Any shares of Series B Preferred Stock
purchased or otherwise acquired by the corporation in any manner
whatsoever shall be retired and cancelled promptly after the
acquisition thereof. All such shares shall upon their cancellation
become authorized but unissued shares of Preferred Stock and may be
reissued as part of a series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.
VI. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (as to amounts payable upon liquidation, dissolution or
winding up) to the Series B Preferred Stock unless, prior thereto, the
holders of Series B Preferred Stock shall have received an amount per
share (rounded to the nearest cent) equal to the greater of (a) $100.00
per share, or (b) an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the aggregate
amount to be distributed per share to holders of Common Stock, plus, in
either case, an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such
payment, or (2) to the holders of stock ranking on a parity (as to
amounts payable or upon liquidation, dissolution or winding up) with
the Series B Preferred Stock and all other such parity stock in
proportion to the total amounts to which the holders of all such shares
are entitled upon such liquidation, dissolution or winding up. If the
corporation shall at any time declare or pay any dividend on Common
Stock payable in shares of Common Stock, or effect a subdivision or
combination of the outstanding shares of Common Stock (by
reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series B Preferred Stock were entitled
immediately prior to such event under the provision in clause (1)(b) of
the preceding sentence shall be adjusted by multiplying such amount by
a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
-5-
<PAGE> 56
VII. Consolidation, Merger, Etc. If the corporation shall
enter into any consolidation, merger, combination or other transaction
in which the shares of Common Stock are exchanged for or changed into
other stock or securities, cash or any other property, or any
combination thereof, then in any such case the shares of Series B
Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash or any other property, or any combination
thereof, into which or for which each share of Common Stock is changed
or exchanged. If the corporation shall at any time declare or pay any
dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or combination of the outstanding shares of Common Stock
(by reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the amount set forth in
the preceding sentence with respect to the exchange or change of shares
of Series B Preferred Stock shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
VIII. No Redemption. The shares of Series B Preferred Stock
shall not be redeemable.
IX. Rank. Except as otherwise provided in its Certificate of
Incorporation, as amended, the corporation may authorize or create any
series of Preferred Stock ranking prior to or on a parity with the
Series B Preferred Stock as to dividends or as to distribution of
assets upon liquidation, dissolution or winding up.
X. Amendment. The Certificate of Incorporation of the
corporation shall not be amended in any manner which would materially
alter or change the powers, preferences or special rights of the Series
B Preferred Stock so as to affect them adversely without the
affirmative vote of the holders of a majority of the outstanding shares
of Series B Preferred Stock, voting together as a single class.
The foregoing resolution was adopted by the Board of Directors of the
corporation, pursuant to the authority vested in it by the Certificate of
Incorporation of the corporation, at a meeting of the Board of Directors duly
held on the 1st day of March, 1991.
-6-
<PAGE> 57
IN WITNESS WHEREOF, this Certificate has been executed on behalf of the
corporation by its President and attested by its Secretary this 13th day of
March, 1991.
TOM BROWN, INC.
By: /s/ Donald L. Evans
-------------------------
President
ATTEST:
/s/ James M. Alsup
-----------------------
Secretary
-7-
<PAGE> 58
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
TOM BROWN, INC.
Tom Brown, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), does hereby
certify as follows:
Pursuant to the provisions of the Delaware General Corporation Law, the
Board of Directors and the stockholders of the Corporation adopted an amendment
to the Certificate of Incorporation of the Corporation, which is set forth in
the following resolution in accordance with Section 242 of the Delaware General
Corporation Law, the purpose of which amendment is to increase the number of
authorized shares of Common Stock:
"RESOLVED, That the Certificate of Incorporation of the Corporation be
amended by changing the first sentence of Article Fourth thereof, so
that as amended, the first sentence of Article Fourth shall read as
follows:
FOURTH: The total number of shares of all classes that the
Corporation shall have authority to issue is 32,500,000, of
which 2,500,000 shares shall be Preferred Stock, par value
$.10 per share, and 30,000,000 shares shall be Common Stock,
$.10 par value per share.
Except as specifically amended hereby, all other provisions of Article
Fourth shall remain in full force and effect.
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Amendment to be signed by Donald L. Evans, its Chairman of the Board of
Directors, and attested by Kim Harris, its Assistant Secretary, this 18th day of
May, 1994.
TOM BROWN, INC.
By: /s/ Donald L. Evans
--------------------------
Donald L. Evans, Chairman of
the Board of Directors
ATTESTED:
/s/ Kim Harris
-------------------------------
Kim Harris, Assistant Secretary
<PAGE> 59
The undersigned Chairman of the Board of Directors of Tom Brown, Inc.,
being duly sworn, does verify that the foregoing instrument represents the act
and deed of Tom Brown, Inc. and that the facts stated in such instrument are
true.
/s/ Donald L. Evans
----------------------------
Donald L. Evans, Chairman of
the Board of Directors
STATE OF TEXAS )
)
COUNTY OF MIDLAND )
Before me, the undersigned authority, on this day personally appeared
DONALD L. EVANS and KIM HARRIS, Chairman of the Board of Directors and Assistant
Secretary, respectively, of Tom Brown, Inc., a corporation formed under the laws
of the State of Delaware, known to me to be the individuals whose names are
subscribed to the foregoing instrument, and acknowledged and swore to me that
they each executed the same for the purposes and consideration therein expressed
and as the act and deed of said corporation and that the facts stated in the
foregoing instrument are true.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 18th day of May, 1994.
/s/ Carolyn Vannoy
-----------------------------
Name: Carolyn Vannoy
------------------------
Notary Public in and for
the State of Texas
-2-
<PAGE> 60
TOM BROWN, INC.
Certificate of Designations, Powers, Preferences
and Rights of the $1.75 Convertible Preferred Stock,
Series A
($0.10 Par Value)
Liquidation Value $25.00 Per Share
----------
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
----------
The undersigned, a Vice President of Tom Brown, Inc., a Delaware
corporation (hereinafter called the "Corporation"), DOES HEREBY CERTIFY that the
following resolution has been duly adopted by the Board of Directors of the
Corporation:
RESOLVED, that pursuant to the authority expressly granted to and
vested in the Board of Directors of the Corporation (the "Board of Directors")
by the provisions of Paragraph FOURTH of the Certificate of Incorporation of the
Corporation, there hereby is created, out of the two million five hundred
thousand (2,500,000) shares of Preferred Stock of the par value of Ten Cents
($0.10) per share of the Corporation authorized in Paragraph FOURTH of its
Certificate of Incorporation (the "Preferred Stock"), a series of Preferred
Stock of the Corporation consisting of One Million (1,000,000) shares, which
series shall have the following designations, powers, preferences, rights,
qualifications, limitations and restrictions (in addition to the designations,
powers, preferences, rights, qualifications, limitations and restrictions set
forth in the Certificate of Incorporation of the Corporation which are
applicable to the Preferred Stock):
1. Designation; Number of Shares.
The designation of said series of the Preferred Stock shall be
"$1.75 Convertible Preferred Stock, Series A" (the "Series A Preferred Stock").
The number of shares of Series A Preferred Stock shall be limited to One Million
(1,000,000).
2. Dividends.
(a) The shares of Series A Preferred Stock shall be entitled
to receive, when and as declared by the Board of Directors or a duly authorized
committee thereof (an "Authorized Board Committee"), out of funds legally
<PAGE> 61
available for the payment of dividends, cumulative dividends at the annual rate
of $1.75 per share, and no more, payable in cash on March 15, 1996, with respect
to the period commencing on the date of original issue thereof and ending March
14, 1996, and thereafter quarterly on the fifteenth day of March, June,
September and December in each year, except that if any such date is a Saturday,
Sunday or legal holiday, then such dividend shall be payable on the next
succeeding day which is not a Saturday, Sunday or legal holiday (the "Dividend
Payment Date" or "Dividend Payment Dates"), with respect to the quarterly period
ending on the fourteenth day of March, June, September or December next
preceding such Dividend Payment Date, to stockholders of record on the record
date, not exceeding sixty (60) days preceding such Dividend Payment Date, fixed
for such purpose by the Board of Directors or an Authorized Board Committee in
advance of each particular Dividend Payment Date. Dividends in arrears may be
declared and paid at any time, without reference to any regular Dividend Payment
Date, to holders of record on such date, not more than sixty (60) nor less than
ten (10) days preceding the payment date thereof, as may be fixed by the Board
of Directors or an Authorized Board Committee. The amount of dividends payable
on shares of Series A Preferred Stock for each full quarterly dividend period
shall be computed by dividing by four the annual rate per share set forth in
this paragraph 2. Dividends payable on the Series A Preferred Stock for the
initial dividend period and for any period less than a full quarterly period
thereafter shall be computed on the basis of a 360-day year of twelve 30-day
months.
(b) Except as provided below with regard to any class of stock
ranking on a parity with the Series A Preferred Stock as to payment of
dividends, so long as shares of Series A Preferred Stock shall remain
outstanding, if full cumulative dividends on the Series A Preferred Stock have
not been declared and paid or set apart for payment, the Corporation shall not
declare or pay or set apart for payment any dividends or make any other
distributions on, or make any payment on account of the purchase, redemption or
retirement of, the Common Stock of the Corporation, or any other stock of the
Corporation ranking on a parity with or junior to the Series A Preferred Stock
as to payment of dividends or distribution of assets on liquidation, dissolution
or winding up of the Corporation (other than, in the case of dividends or
distributions, dividends or distributions paid in shares of Common Stock or such
other junior ranking stock), until full cumulative dividends on the Series A
Preferred Stock are declared and paid or set apart for payment. When dividends
are not paid in full upon the shares of the Series A Preferred Stock and any
other Preferred Stock ranking on a parity as to payment of dividends with the
Series A Preferred Stock, all dividends declared upon shares of the Series A
Preferred Stock and any other Preferred Stock ranking on a parity as to
dividends with the Series A Preferred Stock shall be declared pro rata so that
the amount of dividends declared per share on the Series A Preferred Stock and
such other Preferred Stock shall in all cases bear to each other the same ratio
that accrued dividends per share on the shares of the Series A Preferred Stock
and such other Preferred Stock bear to each other.
-2-
<PAGE> 62
3. Optional Redemptions.
(a) The Corporation may, at its option, at any time beginning
on or after March 15, 2001, redeem all, or any number less than all, of the
outstanding shares of Series A Preferred Stock. The Series A Preferred Stock may
not be redeemed, in whole or in part prior to March 15, 2001. All redemptions of
shares of Series A Preferred Stock at the option of the Corporation shall be
effected at the redemption price of $25.00 per share plus, in each case, an
amount equal to all dividends (whether or not earned or declared) accrued and
unpaid on such share of Series A Preferred Stock to the date of redemption.
(b) The Corporation may not purchase, redeem or otherwise
acquire for value any shares of Series A Preferred Stock or shares of any other
series of Preferred Stock then outstanding ranking on a parity with the Series A
Preferred Stock unless all accumulated dividends on all shares of Series A
Preferred Stock then outstanding shall have been paid or declared and a sum
sufficient for the payment thereof set apart.
(c) Notice of any proposed redemption of shares of Series A
Preferred Stock at the option of the Corporation shall be given by the
Corporation by mailing a copy of such notice no less than thirty (30) days nor
more than sixty (60) days prior to the date fixed for such redemption to holders
of record of the shares of Series A Preferred Stock to be redeemed at their
respective addresses appearing on the books of the Corporation. Said notice
shall specify the shares called for redemption, the redemption price and the
place at which and the date on which the shares called for redemption will, upon
presentation and surrender of the certificates of stock evidencing such shares,
be redeemed and the redemption price therefor paid. In the case of the
redemption of less than all the outstanding shares of Series A Preferred Stock,
the Corporation will select the shares to be redeemed by lot or pro rata (as
nearly as may be) among all then outstanding Series A Preferred Stock or by any
other means permitted or required by the rules of any securities exchange on
which the Series A Preferred Stock is then listed, in each case as may be
prescribed by the Board of Directors or an Authorized Board Committee. From and
after the date fixed in any such notice as the date of redemption of shares of
Series A Preferred Stock, unless default shall be made by the Corporation in
providing monies at the time and place specified for the payment of the
redemption price pursuant to such notice, all dividends on the Series A
Preferred Stock thereby called for redemption shall cease to accrue, such shares
of Series A Preferred Stock shall no longer be deemed to be outstanding and all
rights of the holders thereof as stockholders of the Corporation with respect to
shares of Series A Preferred Stock, except the right to receive the redemption
price plus accrued dividends to the date of redemption, shall cease and
terminate.
-3-
<PAGE> 63
(d) Upon the occurrence of a change of control of the
Corporation, the holders of the shares of Series A Preferred Stock not
previously called for redemption shall have the right to cause the Series A
Preferred Stock to be redeemed by the Corporation, as a whole or in part, within
the time period specified in and subject to the procedures set forth
hereinafter, at the redemption price of $25.50 per share plus, in each case, an
amount equal to all dividends (whether or not earned or declared) accrued and
unpaid on such shares of Series A Preferred Stock to the date of redemption. A
change of control of the Corporation shall be deemed to have occurred if and
when a change of control of the Corporation shall occur pursuant to the
provisions of the Joint Venture Agreement between the Corporation and K N
Energy, Inc., a Kansas corporation ("KNE"), as the same may be amended from time
to time. Unless the Corporation shall have elected to redeem all of the shares
of Series A Preferred Stock pursuant to paragraph 3(a) above, not more than ten
(10) days after the occurrence of a change of control of the Corporation, the
Corporation shall mail a notice thereof to each holder of record of shares of
Series A Preferred Stock at its address appearing on the books of the
Corporation. Said notice shall set forth: (i) a summary description of such
change of control; (ii) the date such change of control occurred; (iii) that
each holder of record of Series A Preferred Stock not previously called for
redemption by the Corporation may require the Corporation to redeem all or any
part of such holder's shares by surrendering the certificates representing such
shares no later than the redemption date; (iv) the redemption date, which shall
be the first business day next succeeding ten (10) days after the giving of such
notice; (v) the redemption price; (vi) that on the redemption date, the
redemption price will become due and payable with respect to each share of
Series A Preferred Stock elected to be redeemed and that dividends thereon shall
cease to accrue on and after said date, unless the Corporation shall default in
redeeming such shares; and (vii) the place or places where certificates
representing shares of Series A Preferred Stock are to be surrendered for
payment of the redemption price. In order for any shares of Series A Preferred
Stock to be redeemed at the election of the holder thereof, the Corporation must
receive a certificate representing such shares at the place or places where such
shares are to be surrendered for payment of the redemption price, on or before
the redemption date, accompanied by written notice to the Corporation
instructing the Corporation to redeem such shares. Such notice duly received
shall be irrevocable. If the Corporation shall fail to give any notice of the
occurrence of a change of control as required by this paragraph 3(d), then the
holders of the Series A Preferred Stock not previously called for redemption
shall have the continuing right to require the Corporation to redeem their
shares at the redemption price specified herein, until the Corporation shall
have given such notice as aforesaid, whereupon such rights shall be subject to
the limitations and procedures set forth in this paragraph 3(d).
(e) All shares of Series A Preferred Stock which shall at any
time have been redeemed, whether at the option of the Corporation or the holder
thereof, shall, after such redemption, have the status of authorized but
unissued
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shares of Preferred Stock, without designation as to series until such
shares are once more designated as part of a particular series by the Board of
Directors or an Authorized Board Committee.
4. Conversion Rights.
(a) Each share of the Series A Preferred Stock shall be
convertible at the option of the holder thereof, at any time prior to the
redemption of such share as hereinabove provided, into fully paid and
nonassessable shares of Common Stock at the initial conversion rate of 1.6660
shares of Common Stock for each share of Series A Preferred Stock, subject to
adjustment as provided in paragraph 4(e).
(b) The Common Stock deliverable upon conversion of Series A
Preferred Stock shall be Common Stock of the Corporation of the par value of
$.10 per share, as constituted at the date of this certificate, except as
otherwise provided in subdivisions (i), (vii) and (ix) of paragraph 4(e).
(c) In order for any holder of Series A Preferred Stock to
convert the same into Common Stock, such holder shall surrender the certificate
or certificates for such Series A Preferred Stock at the principal office of the
Corporation, which certificate or certificates, if the Corporation shall so
request, shall be duly endorsed to the Corporation or in blank, or accompanied
by proper instruments of transfer to the Corporation or in blank, and, subject
to the provisions of paragraph 4(g), shall be accompanied by payment of any
applicable stock transfer or other taxes, and such holder shall give written
notice to the Corporation at such office that such holder elects so to convert
such Series A Preferred Stock, and state in writing therein the name or names in
which such holder wishes the certificate or certificates for Common Stock to be
issued. Every such notice of election to convert shall constitute a contract
between the holder of such Series A Preferred Stock and the Corporation, whereby
the holder of such Series A Preferred Stock shall be deemed to subscribe for the
amount of Common Stock which such holder shall be entitled to receive upon such
conversion, and, in satisfaction of such subscription, to deposit the Series A
Preferred Stock to be converted and to release the Corporation from all
liability thereunder (except to deliver the shares deliverable upon conversion
thereof), and thereby the Corporation shall be deemed to agree that the amount
paid to it for such Series A Preferred Stock, together with the surrender of the
certificate or certificates therefor and the extinguishment of liability thereon
(except as aforesaid), shall constitute full payment of such subscription for
Common Stock to be delivered upon such conversion.
(d) The Corporation will, as soon as practicable after such
deposit of certificates for Series A Preferred Stock accompanied by the written
notice and the statement above prescribed, deliver at said office to the person
for whose account such Series A Preferred Stock was so surrendered, or to such
person's nominee or nominees, certificates for the number of shares of Common
Stock to
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which such person shall be entitled as aforesaid, together with any cash
adjustment of any fraction of a share as hereinafter provided. Subject to the
following provisions of this paragraph, such conversion shall be deemed to have
been made as of the date of such surrender of the Series A Preferred Stock to be
converted; and the person or persons entitled to receive the Common Stock
deliverable upon conversion of such Series A Preferred Stock shall be treated
for all purposes as the record holder or holders of such Common Stock on such
date. The Corporation shall not be required to convert any shares of Series A
Preferred Stock while the stock transfer books of the Corporation are closed for
any purpose; but the surrender of Series A Preferred Stock for conversion during
any period while such books are so closed shall become effective for conversion
immediately upon reopening of such books, as if the surrender had been made on
the date of such reopening, and conversion shall be at the conversion rate in
effect at such date.
No adjustments in respect of, or payments of dividends on,
shares surrendered for conversion or any dividend on the Common Stock issued
upon conversion, shall be made upon the conversion of any shares of Series A
Preferred Stock. Without limiting the generality of the foregoing, if any shares
shall be converted subsequent to the close of business on the record date next
preceding a Dividend Payment Date but on or prior to the opening of business on
such Dividend Payment Date, the registered holder of such shares at the close of
business on such record date shall not be entitled to receive the dividend
otherwise payable on such shares on such Dividend Payment Date.
(e) The conversion rate shall be subject to adjustment as
follows:
(i) In case the Corporation shall (A) pay a dividend
on its Common Stock in shares of its Common Stock, (B) subdivide its
outstanding shares of Common Stock, or (C) combine its outstanding
shares of Common Stock into a smaller number of shares, the conversion
rate in effect at the time of the record date of such dividend,
subdivision, or combination shall be proportionately adjusted so that
the holder of any Series A Preferred Stock surrendered for conversion
after such time shall be entitled to receive the number and kind of
shares which he would have owned or have been entitled to receive had
such Series A Preferred Stock been converted immediately prior to such
time. Such adjustment shall be made successively whenever any event
listed above shall occur.
(ii) In case the Corporation shall issue rights or
warrants to all holders of its Common Stock entitling them (for a
period expiring within 45 days after the record date for the
determination of stockholders entitled to receive such rights or
warrants) to subscribe for or purchase shares of Common Stock at a
price per share less than the Current Market Price (as defined below)
per share of Common Stock on such record date, the number of shares of
Common Stock into which each share of Series A
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Preferred Stock shall be convertible thereafter shall be determined by
multiplying the number of shares of Common Stock into which such shares
of Series A Preferred Stock were convertible immediately prior to such
record date by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding on such record date plus the number
of additional shares of Common Stock offered for subscription or
purchase and of which the denominator shall be the number of shares of
Common Stock outstanding on such record date plus the number of shares
of Common Stock which the aggregate offering price of the total number
of shares so offered would purchase at such Current Market Price. Such
adjustment shall be made successively whenever such rights or warrants
are issued, and shall become effective retroactively immediately after
the record date for the determination of stockholders entitled to
receive such rights or warrants; provided, however, if all the shares
of Common Stock offered for subscription or purchase are not delivered
upon the exercise of such rights or warrants, upon the expiration of
such rights or warrants the conversion rate shall be readjusted to the
conversion rate which would have been in effect had the numerator and
the denominator of the foregoing fraction and the resulting adjustment
been made based upon the number of shares of Common Stock actually
delivered upon the exercise of such rights or warrants rather than upon
the number of shares of Common Stock offered for subscription or
purchase. For the purposes of this subdivision (ii), the number of
shares of Common Stock at any time outstanding shall not include shares
held in the treasury of the Company but shall include shares issuable
in respect of scrip certificates issued in lieu of fractions of shares
of Common Stock.
(iii) In case the Corporation shall distribute to all
holders of its Common Stock shares of its capital stock (other than
Common Stock), evidences of indebtedness or assets of the Corporation
(excluding dividends paid in, or distributions of, cash from the
retained earnings of the Corporation) or subscription rights or
warrants (excluding those referred to in subdivision (ii) above), the
number of shares of Common Stock into which each share of Series A
Preferred Stock shall be convertible thereafter shall be determined by
multiplying the number of shares of Common Stock into which such share
of Series A Preferred Stock was convertible immediately prior to such
record date by a fraction of which the numerator shall be the Current
Market Price per share of the Common Stock on the record date for the
determination of stockholders entitled to receive such distribution and
of which the denominator shall be such Current Market Price per share
of Common Stock less the fair market value (as determined by the Board
of Directors or an Authorized Board Committee thereof, whose
determination shall be conclusive) of the portion of the capital stock,
evidences of indebtedness, assets or subscription rights or warrants
distributed applicable to one share of
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Common Stock. Such adjustment shall be made successively whenever any
such distribution is made, and shall become effective retroactively
after such record date.
(iv) For the purpose of any computation under
subdivisions (ii) and (iii) above, the "Current Market Price" per share
of Common Stock on any date shall be deemed to be the average of the
daily Closing Prices for the thirty (30) consecutive business days
commencing forty-five (45) business days before such date. Where used
herein, the "Closing Price" for each day shall be the reported last
sale price regular way or, in case no such reported sale takes place on
such day, the average of the reported closing bid and asked prices
regular way, in either case as reported on the New York Stock Exchange
Composite Transactions reporting system or, if not so quoted, on the
New York Stock Exchange, or, if at any time the Common Stock is not
listed or admitted to trading on such Exchange, on the principal
national securities exchange on which the Common Stock is listed or
admitted to trading, or if the Common Stock is not listed or admitted
to trading on any national securities exchange, on the National
Association of Securities Dealers Automated Quotation National Market
("NASDAQ"), or, if the Common Stock is not listed or admitted to
trading on any national securities exchange or quoted on NASDAQ, the
average of the closing bid and asked prices in the over-the-counter
market as furnished by any New York Stock Exchange member firm selected
from time to time by the Board of Directors or an Authorized Board
Committee for such purposes.
(v) In any case in which this paragraph 4(e) shall
require that an upward adjustment of the conversion rate as a result of
any event that becomes effective after a record date or effective date
for such event, the Corporation may elect to defer until after the
occurrence of such event (A) issuing to the holder of any shares of
Series A Preferred Stock converted after such record date and before
the occurrence of such event the additional shares of Common Stock
issuable upon such conversion over and above the shares of Common Stock
issuable upon such conversion on the basis of the conversion rate prior
to adjustment and (B) paying to such holder any amount in cash in lieu
of a fractional share of Common Stock pursuant to subdivision (viii)
below; and, in lieu of the shares the issuance of which is so deferred,
the Corporation shall issue or cause its Transfer Agent to issue due
bills or other appropriate evidence of the right to receive such
shares.
(vi) No adjustment in the conversion rate applicable
to a share of Series A Preferred Stock shall be required unless such
adjustment would require an increase or decrease of at least 1% in such
rate; provided, however, that the Corporation may make any such
adjustment at its election; and provided, further, however, that any
adjustments which by reason of this subdivision (vi) are not made shall
be carried forward and
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taken into account in any subsequent adjustment. All calculations under
this paragraph 4(e) shall be made to the nearest one-hundredth of a
share. Anything in this paragraph 4(e) notwithstanding, the Corporation
shall be entitled to make such increases in the conversion rate, in
addition to those required by this paragraph 4(e), as it in its
discretion shall determine to be advisable in order that any dividend
of capital stock, subdivision or combination of shares, distribution of
rights or warrants to purchase capital stock or other securities, or
distribution of securities convertible into or exchangeable for capital
stock, hereafter made by the Corporation to its stockholders shall not
be taxable.
(vii) In case of any consolidation of the Corporation
into, or merger of the Corporation with or into, any other corporation
(other than a consolidation or merger in which the Corporation is the
continuing corporation and which does not result in any
reclassification, change or conversion of outstanding shares of Common
Stock), or in case of any sale or transfer of all or substantially all
of the assets of the Corporation, or in case of any reclassification of
its shares of Common Stock (other than a change in par value, or from
par value to no par value, or from no par value to par value, or as a
result of a subdivision or combination), the holder of each share of
Series A Preferred Stock then outstanding shall have the right
thereafter to convert such share into the kind and amount of shares of
capital stock and other securities, cash and other property receivable
upon such consolidation, merger, sale, transfer or reclassification by
a holder of the number of shares of Common Stock of the Corporation
into which such share of Series A Preferred Stock might have been
converted immediately prior to such consolidation, merger, sale,
transfer or reclassification. In any such event, effective provision
shall be made, in the articles or certificate of incorporation of the
resulting or surviving corporation or other corporation issuing or
delivering such shares of capital stock, other securities, cash or
other property or otherwise, so that the provisions set forth herein
for the protection of the conversion rights of the Series A Preferred
Stock shall thereafter be applicable, as nearly as reasonably may be,
to any such other shares of capital stock and other securities, cash
and other property deliverable upon conversion of the Series A
Preferred Stock remaining outstanding or other convertible stock or
securities received by the holders in place thereof; and any such
resulting or surviving corporation or other corporation issuing or
delivering such shares of capital stock, other securities, cash or
other property shall expressly assume the obligation to deliver, upon
the exercise of the conversion privilege, such shares of capital stock,
securities, cash or other property as the holders of the Series A
Preferred Stock remaining outstanding, or other convertible stock or
securities received by the holders in place thereof, shall be entitled
to receive, pursuant to the provisions hereof, and to make provision
for the protection of the conversion right as above provided. In case
shares of capital stock, securities, cash or other property other than
Common Stock
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shall be issuable or deliverable upon conversion as aforesaid, then all
references to Common Stock in this paragraph 4(e) shall be deemed to
apply, so far as provided and as nearly as is reasonable, to any such
shares of capital stock, other securities, cash or other property.
(viii) No fractional interests in Common Stock shall
be issued upon conversion of shares of Series A Preferred Stock.
Instead of any fractional share of Common Stock which would otherwise
be issuable upon conversion of any share of Series A Preferred Stock,
the Corporation will pay a cash adjustment in respect of such
fractional interest in an amount equal to the same fraction of the
Closing Price per share of Common Stock determined as of the business
day preceding the date of conversion.
(ix) In the event that at any time, as a result of
any adjustment made pursuant to this paragraph 4(e), the holder of any
share of Series A Preferred Stock thereafter surrendered for conversion
shall become entitled to receive any shares of the Corporation other
than shares of its Common Stock, the number of such other shares so
receivable upon conversion of any share of Series A Preferred Stock
shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provision with respect
to the Common Stock contained in subdivisions (i) to (viii), inclusive,
above, with respect to the Common Stock.
(x) Whenever any adjustment is required in the number
of shares into which each share of Series A Preferred Stock is
convertible, the Corporation shall forthwith mail to the holders of
record of the Series A Preferred Stock a statement describing in
reasonable detail the adjustment and the method of calculation used.
(f) Upon any conversion of shares of Series A Preferred Stock,
the shares so converted shall have the status of authorized and unissued shares
of Preferred Stock, unclassified as to series, and the number of shares of
Preferred Stock which the Corporation shall have authority to issue shall not be
decreased by the conversion of shares of Series A Preferred Stock. The
Corporation shall at all times reserve and keep available, out of its authorized
and unissued stock or stock held as treasury stock, solely for the purpose of
effecting the conversion of the Series A Preferred Stock, such number of shares
of its Common Stock as shall from time to time be sufficient to effect the
conversion of all shares of Series A Preferred Stock from time to time
outstanding. For the purpose of this paragraph 4(f), the full number of shares
of Common Stock issuable upon the conversion of all outstanding shares of Series
A Preferred Stock shall be computed as if at the time of computation of such
number of shares of Common Stock all outstanding shares of Series A Preferred
Stock were held by a single holder. The Corporation shall use all reasonable
efforts from time to time, in accordance with the laws of the State of Delaware,
to cause its shareholders to approve an increase in the authorized number of
shares of its Common Stock if
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at any time the number of shares of its Common Stock not outstanding shall not
be sufficient to permit the conversion of all the then outstanding Series A
Preferred Stock.
(g) The Corporation will pay any and all issue or other taxes
that may be payable in respect of any issue or delivery of shares of Common
Stock on conversion of Series A Preferred Stock pursuant thereto. The
Corporation shall not, however, be required to pay any tax which may be payable
in respect of any transfer involved in the issue or delivery of Common Stock in
a name other than that in which the certificate representing the Series A
Preferred Stock so converted was registered, and no such issue or delivery shall
be made unless and until the person requesting such issue has paid to the
Corporation the amount of such tax, or has established, to the satisfaction of
the Corporation, that such tax has been paid.
(h) Before taking any action which would cause an adjustment
reducing the conversion rate such that the conversion price (for purposes of
this paragraph, an amount equal to $25.00 divided by the conversion rate
applicable to a share of Series A Preferred Stock as in effect from time to
time) would be below the then par value of the Common Stock, the Corporation
will take any corporate action which may, in the opinion of its counsel, be
necessary in order that the Corporation may validly and legally issue fully paid
and nonassessable shares of Common Stock at the conversion rate as so adjusted.
5. Exchange.
(a) The shares of Series A Preferred Stock shall be
exchangeable, in whole or in part, at the option of the Corporation on any
Dividend Payment Date at any time on or after March 15, 1999, and prior to March
15, 2001, for fully paid and nonassessable shares of Common Stock at the
exchange rate of 1.6660 shares of Common Stock for each share of Series A
Preferred Stock; provided that (i) on or prior to the date of exchange the
Corporation shall have declared and paid or set apart for payment to the holders
of outstanding shares of Series A Preferred Stock all accumulated and unpaid
dividends to the date of exchange, and (ii) the Current Market Price (as defined
in subdivision (iv) of paragraph 4(e) above) of the Common Stock is above
$18.375 (the "Threshold Price"). The Common Stock deliverable upon exchange of
Series A Preferred Stock shall be Common Stock of the Corporation of the par
value of $.10 per share, as constituted at the date of this certificate, except
as otherwise provided in subdivisions (i), (vii) and (ix) of paragraph 4(e)
which shall be applicable as provided in the next sentence. The exchange rate
shall be subject to adjustment in the same manner and under the same
circumstances as the conversion rate is subject to adjustment as provided in
paragraph 4(e), and the Threshold Price shall be subject to adjustment in the
same manner and under the same circumstances, mutatis mutandis, as the exchange
rate is subject to adjustment. The Corporation will mail to each holder of
record of shares of Series A Preferred Stock at his address appearing on the
books of the Corporation written notice of
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any change in the exchange rate or the Threshold Price and a summary description
of the basis of such change. The Corporation will mail to each holder of record
of the shares of Series A Preferred Stock at his address appearing on the books
of the Corporation written notice of its intention to exchange no less than
thirty (30) nor more than sixty (60) days prior to the date fixed for the
exchange (the "Exchange Date"). Each such notice shall state: (i) the Exchange
Date, (ii) the place or places where certificates for such shares of Series A
Preferred Stock are to be surrendered for exchange into shares of Common Stock,
and (iii) that dividends on the shares of Series A Preferred Stock to be
exchanged will cease to accrue on such Exchange Date.
(b) If notice has been mailed as aforesaid, from and after the
Exchange Date (unless default shall be made by the Corporation in issuing shares
of Common Stock in exchange for, or making the final dividend payment on, the
outstanding shares of Series A Preferred Stock on the Exchange Date), dividends
on the shares of Series A Preferred Stock shall cease to accrue, and said shares
shall no longer be deemed to be issued and outstanding, and all rights of the
holders thereof as holders of shares of Series A Preferred Stock of the
Corporation (except the right to receive from the Corporation the shares of
Common Stock) in respect of such shares of Series A Preferred Stock shall cease
and terminate. Upon surrender in accordance with said notice of the certificates
for any shares of Series A Preferred Stock so exchanged (properly endorsed or
assigned for transfer, if the Corporation shall so require and the notice shall
so state), such shares shall be exchanged by the Corporation for shares of
Common Stock as aforesaid.
(c) All shares of Series A preferred Stock which shall at any
time have been exchanged for shares of Common Stock of the Corporation shall,
after such exchange, have the status of authorized but unissued shares of
Preferred Stock, without designation as to series, until such shares are once
more designated as part of a particular series by the Board of Directors.
(d) The Corporation will, as soon as practicable after the
surrender for exchange of certificates representing shares of Series A Preferred
Stock, deliver at said place for surrender to the person for whose account such
Series A Preferred Stock was so surrendered, or to his nominee or nominees,
certificates for the number of shares of Common Stock to which he shall be
entitled as aforesaid, together with any cash adjustment of any fraction of a
share as hereinafter provided.
(e) The Corporation will pay any and all issue or other taxes
that may be payable in respect of any issue or delivery of shares of Common
Stock on exchange of Series A Preferred Stock pursuant to this paragraph 5. The
Corporation shall not, however, be required to pay any tax which may be payable
in respect of any transfer involved in the issue or delivery of Common Stock in
a name other than that in which the certificate representing the Series A
Preferred Stock so exchanged was registered, and no such issue or delivery shall
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be made unless and until the person requesting such issue has paid to the
Corporation the amount of such tax, or has established, to the satisfaction of
the Corporation, that such tax has been paid.
(f) Before taking any action which would cause an adjustment
reducing the exchange rate such that the exchange price (for purposes of this
paragraph, an amount equal to $25.00 divided by the exchange rate applicable to
a share of Series A Preferred Stock as in effect from time to time) would be
below the then par value of the Common Stock, the Corporation will take any
corporate action which may, in the opinion of its counsel, be necessary in order
that the Corporation may validly and legally issue fully paid and nonassessable
shares of Common Stock at the exchange rate as so adjusted.
6. Number of Shares.
The Board of Directors of the Corporation reserves the right
by subsequent amendment of this resolution from time to time to decrease the
number of shares which constitute the Series A Preferred Stock (but not below
the number of shares thereof then outstanding) and, subject to anything to the
contrary set forth in the Certificate of Incorporation of the Corporation
applicable to the Preferred Stock, to subdivide the number of shares, the stated
value per share and the liquidation value per share of the Series A Preferred
Stock and in other respect to amend, within the limitations provided by law,
this resolution and the Certificate of Incorporation of the Corporation.
7. Liquidation Rights.
Upon the dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Series A
Preferred Stock shall be entitled to receive out of the assets of the
Corporation available for distribution to stockholders, the amount of $25.00 per
share plus an amount equal to all dividends on such shares (whether or not
earned or declared) accrued and unpaid thereon to the date of final
distribution, before any payment or distribution shall be made on the Common
Stock or on any other class of stock ranking junior to the Series A Preferred
Stock with respect to distributions upon dissolution, liquidation or winding up.
For purposes of this paragraph 7, the merger or consolidation of the Corporation
or the sale of all or substantially all of the Corporation's assets, shall not
be deemed to be a liquidation, dissolution or winding up of the Corporation. In
the event the assets of the Corporation available for distribution to the
holders of shares of the Series A Preferred Stock upon any dissolution,
liquidation or winding up of the Corporation shall be insufficient to pay in
full all amounts to which such holders are entitled pursuant to this paragraph
7, no such distributions shall be made upon account of any shares of any other
class of stock of the Corporation ranking on a parity with the shares of the
Series A Preferred Stock upon such dissolution, liquidation or winding up unless
proportionate distributive amounts shall be paid on account of the shares of the
Series A Preferred Stock, ratably,
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in proportion to the full distributable amounts to which holders of all such
parity shares are respectively entitled upon such dissolution, liquidation or
winding up. After the payment to the holders of the shares of the Series A
Preferred Stock of the full preferential amounts provided for in this paragraph
7, the holders of the Series A Preferred Stock as such shall have no right or
claim to any of the remaining assets of the Corporation.
8. Voting Rights.
The shares of Series A Preferred Stock shall have the
following voting rights:
(a) So long as any shares of the Series A Preferred Stock
remain outstanding, the Corporation will not, either directly or indirectly,
without the affirmative vote at a meeting or the written consent with or without
a meeting of the holders of at least 66 2/3% of the shares of Series A Preferred
Stock then outstanding, amend, alter or repeal any of the provisions of the
Certificate of the Designations, Powers, Preferences and Rights of the Series A
Preferred Stock or the Certificate of Incorporation of the Corporation, or
authorize any reclassification of the Series A Preferred Stock, so as in any
such case to affect adversely the preferences, special rights or powers of the
Series A Preferred Stock or authorize any capital stock of the Corporation
ranking, either as to payment of dividends or upon liquidation, dissolution or
winding up of the Corporation, prior to the Preferred Stock.
(b) So long as any shares of the Series A Preferred Stock
remain outstanding, the Corporation will not, either directly or indirectly,
without the affirmative vote at a meeting or the written consent with or without
a meeting of the holders of at least a majority in voting power of shares of the
Series A Preferred Stock then outstanding, increase the authorized number of
shares of Preferred Stock or create, or increase the authorized number of shares
of, any other class of capital stock of the Corporation ranking on a parity with
the Preferred Stock either as to payment of dividends or upon liquidation,
dissolution or winding up of the Corporation.
(c) If at any time dividends payable on the Series A Preferred
Stock are in arrears and unpaid in an amount equal to or exceeding the amount of
dividends payable thereon for four quarterly dividend periods, the total number
of directors on the Corporation's Board of Directors shall be limited to a
maximum of nine and the holders of the outstanding shares of Series A Preferred
Stock will have the exclusive right, voting separately as a class without regard
to series, to designate a special class of two directors of the Corporation (the
"Special Directors") at the next annual or special meeting of stockholders of
the Corporation irrespective of whether such meeting otherwise would involve the
election of directors, and the membership of the Board of Directors of the
Corporation shall be increased by the number of the Special Directors so
designated. Such right of the holders of Series A Preferred Stock to designate
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Special Directors will continue until all dividends accumulated and payable on
the Series A Preferred Stock have been paid in full, at which time such right to
designate Special Directors will terminate, subject to re-vesting in the event
of a subsequent arrearage. Upon any termination of the aforesaid right of
designation, the term of office of all the Special Directors designated by
holders of Series A Preferred Stock will immediately terminate without action by
the Corporation or the Board of Directors thereof.
(d) In exercising the right to designate Special Directors set
forth in this paragraph 8 or when otherwise granted voting rights by operation
of law, each share of Series A Preferred Stock shall be entitled to one vote
except as otherwise provided in this certificate.
(e) To the extent that the rights provided in this paragraph
8(e) do not prevent the continued listing for quotation on NASDAQ, of the Common
Stock of the Corporation, then (i) for so long as KNE owns 80% or more of the
voting power of the securities of the Corporation issued pursuant to the merger
of a subsidiary of the Corporation with and into K N Production Company (the
"Merger") (such voting power being determined in accordance with paragraph 8(f)
below), KNE shall have the right to elect a special class of two directors to
the Board of Directors of the Corporation, and (ii) for so long as KNE owns
securities of the Corporation issued pursuant to the Merger possessing less than
80% of the voting power of the securities of the Corporation issued pursuant to
the merger (such voting power being determined in accordance with paragraph 8(f)
below), but more than 30% of such voting power, KNE shall have the right to
elect a special class of one director to the Board of Directors of the
Corporation.
(f) So long as any shares of the Series A Preferred Stock
remain outstanding, the holders of shares of the Series A Preferred Stock shall
be entitled to vote on all matters upon which holders of the Corporation's
Common Stock have the right to vote. In such voting, each share of Series A
Preferred Stock shall be entitled to a number of votes per share equivalent to
the number of shares of Common Stock issuable upon conversion of the Series A
Preferred Stock and shall vote together with the holder of the outstanding
shares of the Corporation's Common Stock as if a part of that class.
Without limiting the generality of actions with respect to
which the Series A Preferred Stock has no voting rights except as set forth in
this paragraph 8, no consent of holders of the Series A Preferred Stock shall be
required for (i) the creation of any indebtedness of any kind of the
Corporation, or (ii) the authorization or issuance of any class of capital stock
of the Corporation ranking junior to the Series A Preferred Stock in payment of
dividends or upon liquidation, dissolution or winding up of the Corporation.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
duly executed on its behalf by its undersigned Vice President this 29th day of
December, 1995.
/s/ Cliff Drescher
------------------------------
Cliff Drescher, Vice President
-15-
<PAGE> 75
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
TOM BROWN, INC.
Tom Brown, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), does hereby
certify as follows:
Pursuant to the provisions of the Delaware General Corporation Law, the
Board of Directors and the stockholders of the Corporation adopted an amendment
to the Certificate of Incorporation of the Corporation, which is set forth in
the following resolution in accordance with Section 242 of the Delaware General
Corporation Law, the purpose of which amendment is to increase the number of
authorized shares of Common Stock:
"RESOLVED, That the Certificate of Incorporation of the Corporation be
amended by changing the first sentence of Article Fourth thereof, so
that as amended, the first sentence of Article Fourth shall read as
follows:
FOURTH: The total number of shares of all classes that the
Corporation shall have authority to issue is 42,500,000, of
which 2,500,000 shares shall be Preferred Stock, par value
$.10 per share, and 40,000,000 shares shall be Common Stock,
$.10 par value per share.
Except as specifically amended hereby, all other provisions of Article
Fourth shall remain in full force and effect.
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Amendment to be signed by Donald L. Evans, its Chairman of the Board of
Directors, and attested by Kim Harris, its Assistant Secretary, this 22nd day of
May, 1996.
TOM BROWN, INC.
By: /s/ Donald L. Evans
-------------------------------
Donald L. Evans, Chairman of
the Board of Directors
ATTESTED:
/s/ Kim Harris
-------------------------------
Kim Harris, Assistant Secretary
<PAGE> 76
The undersigned Chairman of the Board of Directors of Tom Brown, Inc.,
being duly sworn, does verify that the foregoing instrument represents the act
and deed of Tom Brown, Inc. and that the facts stated in such instrument are
true.
/s/ Donald L. Evans
----------------------------
Donald L. Evans, Chairman of
the Board of Directors
STATE OF TEXAS )
)
COUNTY OF MIDLAND )
Before me, the undersigned authority, on this day personally appeared
DONALD L. EVANS and KIM HARRIS, Chairman of the Board of Directors and Assistant
Secretary, respectively, of Tom Brown, Inc., a corporation formed under the laws
of the State of Delaware, known to me to be the individuals whose names are
subscribed to the foregoing instrument, and acknowledged and swore to me that
they each executed the same for the purposes and consideration therein expressed
and as the act and deed of said corporation and that the facts stated in the
foregoing instrument are true.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 22nd day of May, 1996.
/s/ Carolyn Vannoy
-----------------------------
Name: Carolyn Vannoy
Notary Public in and for
the State of Texas
-2-
<PAGE> 77
[TBI PRODUCTION COMPANY]
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING SUBSIDIARY CORPORATION
INTO PARENT CORPORATION
Pursuant to the provisions of Section 253 of the Delaware General
Corporation Law, Tom Brown, Inc., a Delaware corporation (the "Parent
Corporation"), does hereby certify:
FIRST: That the Parent Corporation was incorporated and duly organized
pursuant to the General Corporation Law of the State of Delaware.
SECOND: The Parent Corporation owns all of the outstanding shares of
each class of capital stock of TBI Production Company, a Delaware corporation
(the "Subsidiary").
THIRD: A copy of the resolutions duly adopted by the Board of Directors
of the Parent Corporation to merge the Subsidiary into the Parent Corporation is
attached hereto as Exhibit A. Such resolutions were adopted as of November 19,
1998, and remain in full force and effect as of the date hereof.
IN WITNESS WHEREOF, said Parent Corporation has caused this Certificate
to be signed by Peter R. Scherer, its Executive Vice President - Southern
Region, this 23rd day of November, 1998.
TOM BROWN, INC.
By: /s/ Peter R. Scherer
-------------------------------------
Peter R. Scherer, Executive Vice
President - Southern Region
<PAGE> 78
EXHIBIT A
WHEREAS, Tom Brown, Inc. (the "Corporation") owns all of the
outstanding shares of Common Stock, par value $.01 per share (the
"Common Stock"), of TBI Production Company, a Delaware corporation (the
"Subsidiary"), and no other shares of any capital stock of the
Subsidiary are outstanding;
WHEREAS, the Corporation desires to merge the Subsidiary into
itself, with the Corporation being the surviving corporation;
NOW, THEREFORE, BE IT RESOLVED, that the Subsidiary be merged
into the Corporation (the "Merger") and that when the Merger becomes
effective upon the filing of a Certificate of Ownership and Merger with
the Delaware Secretary of State, the separate existence of the
Subsidiary shall cease;
RESOLVED FURTHER, that when the Merger becomes effective upon
the filing of a Certificate of Ownership and Merger with the Delaware
Secretary of State, each share of common stock of the Subsidiary shall
cease to exist, the holder of such shares shall cease to have any
rights with respect thereto, and all certificates representing such
shares shall be cancelled;
RESOLVED FURTHER, that the proper officers of the Corporation
be, and they hereby are, authorized in the name and on behalf of the
Corporation to do and perform or to cause to be done and performed all
acts and things as such officer or officers shall deem necessary,
advisable, or appropriate to implement the foregoing resolutions, and
to execute and deliver any and all agreements, certificates,
directives, representations, issuances and other instruments or
documents of every character, including, without limitation, executing,
acknowledging, and filing a Certificate of Ownership and Merger in
accordance with the provisions of the Delaware General Corporation Law,
and to do and perform or cause to be done or performed any and all
other acts and things as such officer or officers of the Corporation
shall deem necessary, advisable or appropriate to comply with the
purposes and intent of the foregoing resolutions; and
RESOLVED FURTHER, that any and all action taken by any officer
of the Corporation in effecting the purposes of the foregoing
resolutions is hereby ratified, approved, confirmed and adopted in all
respects.
<PAGE> 79
[TBI EXPLORATION, INC.]
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING SUBSIDIARY CORPORATION
INTO PARENT CORPORATION
Pursuant to the provisions of Section 253 of the Delaware General
Corporation Law, Tom Brown, Inc., a Delaware corporation (the "Parent
Corporation"), does hereby certify:
FIRST: That the Parent Corporation was incorporated and duly organized
pursuant to the General Corporation Law of the State of Delaware.
SECOND: The Parent Corporation owns all of the outstanding shares of
each class of capital stock of TBI Exploration, Inc., a Colorado corporation
(the "Subsidiary").
THIRD: A copy of the resolutions duly adopted by the Board of Directors
of the Parent Corporation to merge the Subsidiary into the Parent Corporation is
attached hereto as Exhibit A. Such resolutions were adopted as of November 19,
1998, and remain in full force and effect as of the date hereof.
IN WITNESS WHEREOF, said Parent Corporation has caused this Certificate
to be signed by Peter R. Scherer, its Executive Vice President - Southern
Region, this 23rd day of November, 1998.
TOM BROWN, INC.
By: /s/ Peter R. Scherer
---------------------------------
Peter R. Scherer, Executive Vice
President - Southern Region
<PAGE> 80
EXHIBIT A
WHEREAS, Tom Brown, Inc. (the "Corporation") owns all of the
outstanding shares of Common Stock, par value $1.00 per share (the
"Common Stock"), of TBI Exploration, Inc., a Colorado corporation (the
"Subsidiary"), and no other shares of any capital stock of the
Subsidiary are outstanding;
WHEREAS, the Corporation desires to merge the Subsidiary into
itself, with the Corporation being the surviving corporation;
NOW, THEREFORE, BE IT RESOLVED, that the Subsidiary be merged
into the Corporation (the "Merger") and that when the Merger becomes
effective upon the filing of a Certificate of Ownership and Merger with
the Delaware Secretary of State, and the filing of Articles of Merger
with the Colorado Secretary of State, the separate existence of the
Subsidiary shall cease;
RESOLVED FURTHER, that when the Merger becomes effective upon
the filing of a Certificate of Ownership and Merger with the Delaware
Secretary of State, and the filing of Articles of Merger with the
Colorado Secretary of State, each share of common stock of the
Subsidiary shall cease to exist, the holder of such shares shall cease
to have any rights with respect thereto, and all certificates
representing such shares shall be cancelled;
RESOLVED FURTHER, that the proper officers of the Corporation
be, and they hereby are, authorized in the name and on behalf of the
Corporation to do and perform or to cause to be done and performed all
acts and things as such officer or officers shall deem necessary,
advisable, or appropriate to implement the foregoing resolutions, and
to execute and deliver any and all agreements, certificates,
directives, representations, issuances and other instruments or
documents of every character, including, without limitation, executing,
acknowledging, and filing a Certificate of Ownership and Merger in
accordance with the provisions of the Delaware General Corporation Law,
and the filing of Articles of Merger with the Colorado Secretary of
State, and to do and perform or cause to be done or performed any and
all other acts and things as such officer or officers of the
Corporation shall deem necessary, advisable or appropriate to comply
with the purposes and intent of the foregoing resolutions; and
RESOLVED FURTHER, that any and all action taken by any officer
of the Corporation in effecting the purposes of the foregoing
resolutions is hereby ratified, approved, confirmed and adopted in all
respects.
<PAGE> 81
[TBI OIL COMPANY]
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING SUBSIDIARY CORPORATION
INTO PARENT CORPORATION
Pursuant to the provisions of Section 253 of the Delaware General
Corporation Law, Tom Brown, Inc., a Delaware corporation (the "Parent
Corporation"), does hereby certify:
FIRST: That the Parent Corporation was incorporated and duly organized
pursuant to the General Corporation Law of the State of Delaware.
SECOND: The Parent Corporation owns all of the outstanding shares of
each class of capital stock of TBI Oil Company, a Delaware corporation (the
"Subsidiary").
THIRD: A copy of the resolutions duly adopted by the Board of Directors
of the Parent Corporation to merge the Subsidiary into the Parent Corporation is
attached hereto as Exhibit A. Such resolutions were adopted as of November 19,
1998, and remain in full force and effect as of the date hereof.
IN WITNESS WHEREOF, said Parent Corporation has caused this Certificate
to be signed by Peter R. Scherer, its Executive Vice President - Southern
Region, this 23rd day of November, 1998.
TOM BROWN, INC.
By: /s/ Peter R. Scherer
-----------------------------------
Peter R. Scherer, Executive Vice
President - Southern Region
<PAGE> 82
EXHIBIT A
WHEREAS, Tom Brown, Inc. (the "Corporation") owns all of the
outstanding shares of Common Stock, par value $.01 per share (the
"Common Stock"), of TBI Oil Company, a Delaware corporation (the
"Subsidiary"), and no other shares of any capital stock of the
Subsidiary are outstanding;
WHEREAS, the Corporation desires to merge the Subsidiary into
itself, with the Corporation being the surviving corporation;
NOW, THEREFORE, BE IT RESOLVED, that the Subsidiary be merged
into the Corporation (the "Merger") and that when the Merger becomes
effective upon the filing of a Certificate of Ownership and Merger with
the Delaware Secretary of State, the separate existence of the
Subsidiary shall cease;
RESOLVED FURTHER, that when the Merger becomes effective upon
the filing of a Certificate of Ownership and Merger with the Delaware
Secretary of State, each share of common stock of the Subsidiary shall
cease to exist, the holder of such shares shall cease to have any
rights with respect thereto, and all certificates representing such
shares shall be cancelled;
RESOLVED FURTHER, that the proper officers of the Corporation
be, and they hereby are, authorized in the name and on behalf of the
Corporation to do and perform or to cause to be done and performed all
acts and things as such officer or officers shall deem necessary,
advisable, or appropriate to implement the foregoing resolutions, and
to execute and deliver any and all agreements, certificates,
directives, representations, issuances and other instruments or
documents of every character, including, without limitation, executing,
acknowledging, and filing a Certificate of Ownership and Merger in
accordance with the provisions of the Delaware General Corporation Law,
and to do and perform or cause to be done or performed any and all
other acts and things as such officer or officers of the Corporation
shall deem necessary, advisable or appropriate to comply with the
purposes and intent of the foregoing resolutions; and
RESOLVED FURTHER, that any and all action taken by any officer
of the Corporation in effecting the purposes of the foregoing
resolutions is hereby ratified, approved, confirmed and adopted in all
respects.
<PAGE> 83
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
OF
TOM BROWN, INC.
Tom Brown, Inc., a corporation organized and existing under
the General Corporation Law of the State of Delaware (the "Corporation"), does
hereby certify as follows:
Pursuant to the provisions of the Delaware General Corporation
Law, the Board of Directors and the stockholders of the Corporation adopted an
amendment to the Certificate of Incorporation of the Corporation, which is set
forth in the following resolution in accordance with Section 242 of the Delaware
General Corporation Law, the purpose of which amendment is to increase the
number of authorized shares of Common Stock:
"RESOLVED, That the Certificate of Incorporation of the
Corporation be amended by changing the first sentence of
Article Fourth thereof, so that as amended, the first sentence
of Article Fourth shall read as follows:
FOURTH: The total number of shares of all classes
that the Corporation shall have authority to issue is
57,500,000, of which 2,500,000 shares shall be Preferred
Stock, par value $.10 per share, and 55,000,000 shares shall
be Common Stock, $.10 par value per share.
Except as specifically amended hereby, all other provisions of Article
Fourth shall remain in full force and effect.
IN WITNESS WHEREOF, Tom Brown, Inc. has caused this Certificate of
Amendment to be signed by Donald L. Evans, its Chairman of the Board of
Directors, and attested by Bruce R. DeBoer, its Secretary, this 25th day of May,
1999.
TOM BROWN, INC.
By: /s/ Donald L. Evans
------------------------------
Donald L. Evans, Chairman of
the Board of Directors
ATTESTED:
/s/ Bruce R. DeBoer
--------------------------
Bruce R. DeBoer, Secretary
