PRE-PAID LEGAL SERVICES, INC.
FORM 8-K
September 13, 2000
EXHIBIT INDEX
Exhibit No. Description
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4.1 Restated Certificate of Incorporation
of the Company as filed with the
Secretary of State of Oklahoma on
August 29, 2000.
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EXHIBIT 4.1
RESTATED
CERTIFICATE OF INCORPORATION
OF
PRE-PAID LEGAL SERVICES, INC.
The undersigned officers of Pre-Paid Legal Services, Inc., an Oklahoma
corporation (the "Corporation"), do hereby certify as follows:
1. The Articles of Incorporation of the Corporation were originally
filed with the Secretary of State of the State of Oklahoma on January 20, 1976
and were amended from time to time thereafter.
2. This Restated Certificate of Incorporation has been duly adopted by
the Board of Directors of the Corporation in accordance with Section 1080 of the
Oklahoma General Corporation Act.
3. This Restated Certificate of Incorporation restates and integrates
and does not further amend the provisions of the Corporation's Certificate of
Incorporation, as amended, and there is no discrepancy between those provisions
and the provisions of this Restated Certificate of Incorporation, except as
permitted by Section 1080.C of the Oklahoma General Corporation Act.
4. The text of the Corporation's Certificate of Incorporation, as
amended, is hereby restated in its entirety by this Restated Certificate of
Incorporation as follows:
FIRST. The name of the Corporation is PRE-PAID LEGAL SERVICES, INC.
SECOND. The address of its registered office in the State of Oklahoma
is 321 East Main, in the City of Ada, County of Pontotoc, 74820. The name of its
registered agent at such address is Harland C. Stonecipher.
THIRD. The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may be organized under the Oklahoma General
Corporation Act.
FOURTH. The total number of shares of capital stock which the
Corporation shall have authority to issue is 100,900,000 shares, consisting of
400,000 shares of Preferred Stock, par value $1.00 per share, 500,000 shares of
Special Preferred Stock, par value $1.00 per share, and 100,000,000 shares of
Common Stock, par value $.01 per share.
The shares of such classes shall have the following express terms:
DIVISION A
EXPRESS TERMS OF THE PREFERRED STOCK
The Preferred Stock may be issued from time to time in one or more
series. The Board of Directors is hereby authorized to provide for the issuance
of Preferred Stock in series and by filing a certificate pursuant to the
applicable law of the State of Oklahoma, to establish from time to time the
number of shares to be included in such series, and to fix the designation,
powers, preferences and rights of the shares of each such series and the
qualifications, limitations, or restrictions thereof.
The authority of the Board of Directors with respect to each series
shall include, but not be limited to, determination of the following:
(1) The number of shares constituting that series and the
distinctive designation of that series;
(2) The dividend rate on the shares of that series, whether
dividends shall be cumulative, and, if so, from which date or dates,
and the relative rights of priority, if any, of payment of dividends on
shares of that series;
(3) Whether that series shall have voting rights, in addition
to the voting rights provided by law, and, if so, the terms of such
voting rights;
(4) Whether that series shall have conversion privileges, and,
if so, the terms and conditions of such conversion, including provision
for adjustment of the conversion rate in such events as the Board of
Directors shall determine;
(5) Whether or not the shares of that series will be
redeemable, and, if so, the terms and conditions of such redemption,
including the date or dates upon or after which they shall be
redeemable, and the amount per share payable in case of redemption,
which amount may vary under different conditions and at different
redemption dates;
(6) Whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and, if so, the terms
and amount of such sinking fund;
(7) The rights of the shares of that series in the event of
voluntary or involuntary liquidation, dissolution or winding up of the
corporation, and the relative rights of priority, if any, of payment of
shares of that series; and
(8) Any other relative rights, preferences and limitations of
that series.
DIVISION B
EXPRESS TERMS OF THE SPECIAL PREFERRED STOCK
Section 1. The Special Preferred Stock may be issued from time to time
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in one or more series. Subject to the provisions of Section 2 of this Division,
which provisions shall apply to all Special Preferred Stock, the Board of
Directors is authorized to provide for the issuance of Special Preferred Stock
in series and by filing a certificate pursuant to the applicable law of the
State of Oklahoma, to establish from time to time the number of shares to be
included in such series, and to fix the designation, powers, preferences and
rights of the shares of each such series and the qualifications, limitations, or
restrictions thereof.
The authority of the Board of Directors with respect to each series
shall include, but not be limited to, determination of the following:
(1) The number of shares constituting that series and the
distinctive designation of that series;
(2) The dividend rate on the shares of that series, whether
dividends shall be cumulative, and, if so, from which date or dates,
and the relative rights of priority, if any, of payment of dividends on
shares of that series;
(3) Whether that series shall have voting rights, in addition
to the voting rights provided by law, and, if so, the terms of such
voting rights;
(4) Whether that series shall have conversion privileges, and,
if so, the terms and conditions of such conversion, including provision
for adjustment of the conversion rate in such events as the Board of
Directors shall determine;
(5) Whether or not the shares of that series will be
redeemable, and, if no, the terms and conditions of such redemption,
including the date or dates upon or after which they shall be
redeemable, and the amount per share payable in case of redemption,
which amount may vary under different conditions and at different
redemption dates;
(6) Whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and, if so, the terms
and amount of such sinking fund;
(7) The rights of the shares of that series in the event of
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, and the relative rights of priority, if any, of payment of
shares of that series; and
(8) Any other relative rights, preferences and limitations of
that series.
Section 2. The Special Preferred Stock shall be on a ranking junior to
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the Preferred Stock as to payment of dividends and as to distributions in the
event of a voluntary or involuntary liquidation, dissolution or winding up of
the corporation. Accordingly, holders of shares of Preferred Stock shall be
entitled to receive dividends and distributions in priority to any dividends or
distributions to holders of shares of Special Preferred Stock in accordance with
the express terms of the Preferred Stock or any series thereof.
DIVISION C
EXPRESS TERMS OF THE COMMON STOCK
The Common Stock shall be subject to the express terms of the Preferred
Stock and the Special Preferred Stock in any series thereof. The holders of the
Common Stock voting together as one class shall have the sole and exclusive
right to elect the directors of the Corporation, subject to any voting rights of
any outstanding shares of Preferred Stock or Special Preferred Stock.
Dividends on the Common Stock may be declared at or for such time and
periods as the Board of Directors may from time to time, in its sole discretion,
determine out of funds legally available therefor.
In the event of a voluntary or involuntary winding up, distribution or
liquidation of this Corporation, after distribution of any amounts distributable
to holders of securities of the Corporation having a preference in liquidation,
all funds, assets or property available for distribution shall be ratably paid
and distributed among the holders of the issued and outstanding Common Stock.
FIFTH. The bylaws may be adopted, altered, amended or repealed
by the Board of Directors. Election of directors need not be by written ballot
unless the bylaws so provide.
SIXTH. Whenever a compromise or arrangement is proposed between this
Corporation and its creditors, or any class of them and/or between this
Corporation and its shareholders or any class of them, any court of equitable
jurisdiction within the State of Oklahoma, on the application in a summary way
of this Corporation or of any creditor or shareholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 1106 of Title 18 of the Oklahoma Statutes (Supp. 1986)
or on the application of trustees in dissolution or of any receiver or receivers
appointed for this Corporation under the provisions of Section 1100 of Title 18
of the Oklahoma Statutes (Supp. 1986), may order a meeting of the creditors or
class of creditor, and/or of the shareholders or class of shareholders of this
Corporation, as the case may be, to be summoned in such manner as the court
directs. If a majority in number representing three-fourths (3/4) in value of
the creditors or class of creditors, and/or of the shareholders or class of
shareholders of this Corporation, as the case may be, agree to any compromise or
arrangement and to any reorganization of this Corporation as a consequence of
such compromise or arrangement, the compromise or arrangement and the
reorganization, if sanctioned by the court to which the application has been
made, shall be binding on all the creditors or class of creditors, and/or on all
the shareholders or class of shareholders, of this Corporation, as the case may
be, and also on this Corporation.
SEVENTH: (1) To the fullest extent that the Oklahoma General Corpora-
tion Act as it existed on December 16, 1987 (the original date of filing with
the Oklahoma Secretary of State of the Amended and Restated Certificate of
Incorporation originally containing this Article SEVENTH) (the "Effective
Date"), permits the limitation or elimination of the liability of directors, no
director of this Corporation shall be liable to this Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director.
No amendment to or repeal of this Article SEVENTH shall apply to or have any
effect on the liability or alleged liability of any director of this Corporation
for or with respect to any acts or omissions of such director occurring prior
to the time of such amendment or repeal.
(2) If the Oklahoma General Corporation Act is amended after the
Effective Date to further limit or eliminate liability of this Corporation's
directors for breach of fiduciary duty, then a director of this Corporation
shall not be liable for any such breach to the fullest extent permitted by the
Oklahoma General Corporation Act as so amended. If the Oklahoma General
Corporation Act is amended after the Effective Date to increase or expand
liability of this Corporation's directors for breach of fiduciary duty, no such
amendment shall apply to or have any effect on the liability or alleged
liability of any director of this Corporation for or with respect to any acts or
omissions of such director occurring prior to the time of such amendment or
otherwise adversely affect any right or protection of a director of this
Corporation existing at the time of such amendment.
EIGHTH: The provisions of this Article EIGHTH shall apply to any of
the following transactions (hereinafter referred to as "Business Combinations"):
(a) any merger, consolidation or reorganization of the Corpor-
ation or any significant subsidiary of the Corporation in any manner permitted
by law with or into any Related Person; or
(b) any sale, lease, mortgage, pledge, exchange or other
disposition (in one transaction or series of related transactions) of
all or substantially all of the assets of the Corporation or of any
significant subsidiary of the Corporation to any Related Person, or
(c) any sale, lease, mortgage, pledge, exchange or other
disposition (in one transaction or a series of related transactions) by
any Related Person to the Corporation or any subsidiary of the
Corporation of any assets in exchange for voting securities (or
securities, or options, warrants or rights to purchase voting
securities or securities convertible into or exchangeable for voting
securities) constituting 5% or more of the outstanding securities of
the Corporation after such transaction; or
(d) any reclassification of securities, recapitalization or
other transaction which has the direct or indirect effect of increasing
the voting power, whether or not then exercisable, of any Related
Person; or
(e) the adoption of any plan or proposal for the liquidation
or dissolution of the Corporation proposed by or on behalf of any
Related Person.
A corporation, person or other entity which is the beneficial owner, directly or
indirectly, of 5% or more of the total voting power of the outstanding voting
securities of the Corporation is herein referred to as the "Related Person."
Section 1. No Business Combination may be effected unless all of the
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following conditions, to the extent applicable, are fulfilled:
(a) The Related Person shall not have acquired any
voting securities, directly or indirectly, from the
Corporation except in a Business Combination to which this
Article did not apply or in a Business Combination to which
this Article did apply and which satisfied all of the
requirements of this Article.
(b) After the time when the Related Person became the
beneficial owner, directly or indirectly, of 5% or more of the
total voting power of the outstanding voting securities of the
Corporation, the Related Person shall not have (i) received
the benefit, directly or indirectly, of any loans, advances,
extensions of credit, guarantees, pledges or other financial
assistance or tax benefits provided, directly or indirectly,
by the Corporation, or (ii) made or caused to be made any
major changes in the Corporation's business or equity capital
structure without the unanimous approval of the directors of
the Corporation then in office.
(c) A proxy statement complying with the requirements
of the Securities Exchange Act of 1934, or any similar or
superseding federal statute, as at the time in effect (whether
or not the provisions of such act or statute shall be
applicable to the Corporation) shall be mailed to shareholders
of the Corporation for the purpose of soliciting shareholder
approval of the Business Combination and shall contain at the
front thereof, in a prominent place, any recommendations as to
the advisability (or inadvisability) of the Business
Combination which any of the directors may choose to state and
an opinion of a reputable investment banking firm stating that
the terms of the Business Combination are fair from the point
of view of both the Corporation and the shareholders of the
Corporation other than any Related Person.
Section 2. No Business Combination shall be effected unless it is
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approved at an annual meeting or a special meeting of the Corporation's
shareholders called for that purpose. The affirmative vote in person or by proxy
of the holders of not less than 80% of the voting power of all outstanding
voting stock of the Corporation, voting as a single class, shall be required for
approval of any such Business Combination.
Section 3. For the purposes of this Article, any corporation, person or
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entity will be deemed to be the beneficial owner of any voting securities of the
Corporation:
(a) which it owns directly, whether or not of record;
or
(b) which it has the right to acquire pursuant to any
agreement or arrangement or understanding or upon exercise of
conversion rights, exchange rights, warrants or options or
otherwise; or
(c) which are beneficially owned, directly or
indirectly (including shares deemed to be owned through
application of clause (b) above), by any 'affiliate' or
'associate' as those terms as defined in Rule 12b-2 of the
General Rules and Regulations of the Securities and Exchange
Commission adopted pursuant to the Securities Exchange Act of
1934 as in effect on the date hereof; or
(d) which are beneficially owned, directly or
indirectly (including shares deemed owned through application
of clause (b) above), by any other corporation, person or
entity with which it or any of its 'affiliates' or
'associates' has any agreement or arrangement or understanding
for the purpose of acquiring, holding, voting or disposing of
voting securities of the Corporation.
For the purposes only of determining whether a corporation, person or
other entity owned beneficially, directly or indirectly, 5% or more of the total
voting power of the outstanding voting securities of the Corporation, the
outstanding voting securities of the Corporation will be deemed to include any
voting securities that may be issuable pursuant to any agreement, arrangement or
understanding or upon exercise of conversion rights, exchange rights, warrants,
options or otherwise which are deemed to be beneficially owned by such
corporation, person or other entity pursuant to the foregoing provisions of this
Section 3.
Section 4. The provisions of this Article shall not apply to a Business
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Combination which (a) (i) does not change any voting security holder's
percentage ownership of voting power in any successor of the corporation from
the percentage of voting power beneficially owned by such holder in the
Corporation, (ii) provides for the provisions of this Article, without any
amendment, change, alteration or deletion, to apply to any successor to the
Corporation, and (iii) does not transfer all or substantially all of the
Corporation's assets other than to a wholly-owned subsidiary of the corporation;
or (b) shall have been authorized by a majority of the Board of Directors of the
Corporation prior to the time that the Related Person became the beneficial
owner, directly or indirectly, of 5% or more of the total voting power of the
outstanding voting securities of the Corporation.
Section 5. The affirmative vote required by this Article will be in
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addition to the vote of the holders of any class or series of stock of the
Corporation otherwise required by law, or this Certificate of Incorporation, or
the resolution providing for the issuance of a class or series of stock which
has been adopted by the Board of Directors, or any agreement between the
Corporation and any national securities exchange.
Section 6. The Board of Directors of the Corporation shall make all
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determinations pursuant to this Article, including, without limitation, (i) the
amount of voting power beneficially owned directly or indirectly, by any
corporation, person or entity, and (ii) the status of any corporation, person or
entity as an affiliate or associate of another. Any such determination
reasonably made in good faith by the Board of Directors on the basis of
available information shall be conclusive and binding, and no director will have
any liability to the Corporation, or any other corporation, person or entity by
reason of any such determination so made.
Section 7. This Article EIGHTH shall not be altered, amended or
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repealed, nor shall any provision inconsistent with this Article EIGHTH be
adopted, except by the affirmative vote of at least eighty percent (80%) of the
voting power of the outstanding voting stock of the Corporation, voting as a
single class.
NINTH: Notwithstanding anything contained in the Certificate of
Incorporation or the Bylaws of the Corporation to the contrary:
Section 1. Number, Election and Terms. The Board of Directors of the
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Corporation shall consist of not less than three nor more than twenty-four
members with the exact number to be fixed from time to time by the Board of
Directors. Upon the adoption of this Article NINTH, the directors shall be
divided into three classes, designated Class A, Class B, and Class C, as nearly
equal in number as possible, with the term of office of the Class C directors to
expire at the 1988 annual meeting of shareholders, the term of office of the
Class B directors to expire at the 1989 annual meeting of shareholders, and the
term of office of the Class A directors to expire at the 1990 annual meeting of
shareholders. At each meeting of shareholders following such initial
classification and election, the number of directors equal to the number of the
class whose term expires at the time of such meeting shall be elected to hold
office until the third succeeding annual meeting of shareholders. Each director
shall hold office until his successor is elected and qualified, or until his
earlier resignation or removal.
Section 2. Newly Created Directorships and Vacancies. Newly created
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directors resulting from any increase in the authorized number of directors and
any vacancies in the Board of Directors resulting from death, resignation,
retirement, disqualification, removal from office or other cause may be filled
only by the affirmative vote of 80% of the directors then in office, although
less than a quorum, and directors so chosen shall hold office for a term
expiring at the annual meeting of shareholders at which the term of the class to
which they have been elected expires and until his successor is elected and
qualified.
Section 3. Removal. At a meeting of shareholders or directors, as the
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case may be, called expressly for that purpose, any director, or the entire
Board of Directors, may be removed from office at any time, with or without
cause, by only by the affirmative vote of the holders of at least 80% of the
outstanding shares of the Corporation then entitled to be voted in an election
of directors or by the affirmative vote of at least two-thirds (2/3) of the
directors then in office.
Section 4. Amendment, Repeal, Etc. The affirmative vote of the holders
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of at least 80% of the outstanding shares of the Corporation then entitled to be
voted in an election of directors shall be required to alter, amend or repeal,
or to adopt any provision inconsistent with, this Article NINTH.
TENTH. Except upon the affirmative vote of shareholders holding all
the issued and outstanding shares of stock of the Corporation, no amendment to
this Certificate of Incorporation may be adopted by the Corporation which would
impose personal liability for the debts of the Corporation on the shareholders
of the Corporation or which would amend, alter or repeal this Article TENTH or
would adopt any provision inconsistent with this Article TENTH.
ELEVENTH. The shareholders of the Corporation duly adopted the Amended
and Restated Certificate of Incorporation originally containing this Article
ELEVENTH (as filed with the Oklahoma Secretary of State on December 16, 1987)
for the purpose of definitively providing that all provisions of the Oklahoma
General Corporation Act will apply to the Corporation and its shareholders to
the fullest extent, and that from and after the filing of such Amended and
Restated Certificate with the Oklahoma Secretary of State the provisions of the
Oklahoma Business Corporation Act and any and all rights, privileges or
immunities thereunder shall be of no further force or effect with regard to the
Corporation and its shareholders.
TWELFTH. Subject to the limitations set forth in this Certificate of
Incorporation, 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
shareholders herein are granted subject to this reservation.
IN WITNESS WHEREOF, Pre-Paid Legal Services, Inc. has caused this
Certificate to be signed and attested by its duly authorized officers as of the
28th day of August, 2000.
ATTEST: PRE-PAID LEGAL SERVICES, INC.
/s/ Kathryn Walden By: /s/ Harland C. Stonecipher
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Kathryn Walden, Secretary Harland C. Stonecipher,
Chairman and Chief Executive
Officer
