<PAGE>
As filed with the Securities and Exchange Commission on March 21, 1997
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
___________
FRIEDMAN'S INC.
(Exact name of registrant as specified in its charter)
DELAWARE 58-2058362
(State of incorporation) (IRS Employer Identification No.)
4 WEST STATE STREET
SAVANNAH, GEORGIA 31401
(Address of Principal Executive Offices) (Zip Code)
FRIEDMAN'S INC.
AMENDED AND RESTATED
1994 STOCK OPTION PLAN
FOR OUTSIDE DIRECTORS
(Full title of the plan)
BRADLEY J. STINN
CHAIRMAN OF THE BOARD OF DIRECTORS
FRIEDMAN'S INC.
4 WEST STATE STREET
SAVANNAH, GEORGIA 31401
(912) 233-9333
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPY TO:
M. HILL JEFFRIES
ALSTON & BIRD LLP
ONE ATLANTIC CENTER
1201 WEST PEACHTREE STREET
ATLANTA, GEORGIA 30309-3424
(404) 881-7000
_________________________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=======================================================================================================================
TITLE OF PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF REGISTRATION
SECURITIES TO AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING FEE
BE REGISTERED REGISTERED (1) SHARE (2) PRICE
- - -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Common Stock, $.01 par value 4,000 $14.94 $ 59,760 $ 18
- - -----------------------------------------------------------------------------------------------------------------------
Class A Common Stock, $.01 par value 21,000 $17.32 363,720 $111
- - -----------------------------------------------------------------------------------------------------------------------
Total 25,000 $423,480 $129
- - -----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) This Registration Statement also covers any additional shares that may
hereafter become purchasable as a result of the adjustment provisions of
the Friedman's Inc. Amended and Restated 1994 Stock Option Plan for Outside
Directors (the "Plan").
(2) Determined in accordance with Rule 457(h), the registration fee is based on
the average option price per share for shares presently subject to options
and, for those shares not presently subject to options, on the average of
the high and low prices of the Registration's Class A Common Stock reported
on the Nasdaq National Market on March 17, 1997.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by Friedman's Inc. (the "Company") with the
Securities and Exchange Commission (the "Commission") are incorporated herein by
reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended September 30, 1996.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 since the end of the fiscal year covered by the
document incorporated pursuant to (a) above.
(c) The description of the Class A Common Stock, $.01 par value per
share of the Company which is contained in a registration statement filed under
Section 12 of the Securities Exchange Act of 1934, including any amendment or
report filed for the purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14, and 15(d) of the Securities Exchange Act of 1934 prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part hereof from the
date of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES. Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the issuance the securities being registered has been
passed upon for the Company by the law firm of Alston & Bird LLP.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware
empowers a Delaware corporation to indemnify present and former directors,
officers, employees or agents of the corporation. Article Ninth of the
Certificate of Incorporation, as amended, of the Registrant provides:
NINTH: Limitation of Liability; Indemnification
A. Limitation of Directors' Liability
To the fullest extent that the General Corporation Law of the State of
Delaware, as it exists on the date hereof or as it may hereafter be amended,
permits the limitation or elimination of the liability of directors, no
director of the Company shall be liable to the Company or its stockholders
for monetary damages for beach of fiduciary duty as a director. No amendment
to or repeal of this Section A of this Article shall apply to or have any
effect on the liability or alleged liability of any director of the Company
for or with respect to any acts or omissions of such director occurring prior
to such amendment or repeal.
<PAGE>
B. Indemnification
1. Right to Indemnification. The Company shall to the fullest extent
permitted by applicable law as then in effect indemnify any person (the
"Indemnitee") who was or is involved in any manner (including, without
limitation, as a party or witness) or is threatened to be made so involved
in any threatened, pending or completed investigation, claim, action, suit
or proceeding, whether civil, criminal, administrative or investigative
(including, without limitation, any action, suit or proceeding by or in the
right of the Company to procure a judgment in its favor) (a "Proceeding")
by reason of the fact that he is or was a director or officer of the
Company, or is or was serving at the request of the Company as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise (including, without limitation, any
employee benefit plan) against all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such Proceeding. Such indemnification
shall be a contract right and shall include the right to receive payment in
advance of any expenses incurred by the Indemnitee in connection with such
Proceeding, consistent with the provisions of applicable law as then in
effect.
(2) Insurance, Contracts and Funding. The Company may purchase and
maintain insurance to protect itself and any Indemnitee against any
expenses, judgments, fines and amounts paid in settlement as specified in
Section B-1 of this Article or incurred by any Indemnitee in connection
with any Proceeding referred to in Section B-1 of this Article, to the
fullest extent permitted by applicable law as then in effect. The Company
may enter into contracts with any director, officer, employee or agent of
the Company in furtherance of the provisions of this Article and may create
a trust fund, grant a security interest or use other means (including,
without limitation, a letter of credit) to ensure the payment of such
amounts as may be necessary to effect indemnification as provided in this
Article.
(3) Indemnification Not Exclusive Right. The right of indemnification
provided in this Article shall not be exclusive of any other rights to
which those seeking indemnification may otherwise be entitled, and the
provisions of this Article shall inure to the benefit of the heirs and
legal representatives of any person entitled to indemnity under this
Article and shall be applicable to proceedings commenced or continuing
after the adoption of this Article, whether arising from acts or omissions
occurring before or after such adoption.
(4) Advancement of Expenses; Procedures; Presumptions and Effects of
Certain Proceedings; Remedies. In furtherance but not in limitation of the
foregoing provisions, the following procedures, presumptions and remedies
shall apply with respect to the advancement of expenses and the right to
indemnification under this Article:
(a) Advancement of Expenses. All reasonable expenses incurred by
or on behalf of an Indemnitee in connection with any proceeding shall
be advanced to the Indemnitee by the Company within 20 days after the
receipt by the Company of a statement or statements from the Indemnitee
requesting such advance or advances from time to time, whether prior to
or after final disposition of such Proceeding. Such statement or
statements shall reasonably evidence the expenses incurred by the
Indemnitee and, if required by law at the time of such advance, shall
include or be accompanied by an undertaking by or on behalf of the
Indemnitee to repay the amounts advanced if it should ultimately be
determined that the Indemnitee is not entitled to be indemnified
against such expenses pursuant to this Article.
(b) Procedure for Determination of Entitlement to
Indemnification. (i) To obtain indemnification under this Article, an
Indemnitee shall submit to the Secretary of the Company a written
request, including such documentation as is reasonably
II-2
<PAGE>
available to the Indemnitee and reasonably necessary to determine whether
and to what extent the Indemnitee is entitled to indemnification (the
"Supporting Documentation"). The determination of the Indemnitee's
entitlement to indemnification shall be made no later than 60 days after
receipt by the Company of the written request for indemnification together
with the Supporting Documentation. The Secretary of the Company shall,
promptly upon receipt of such a request for indemnification, advise the
Board of Directors in writing that the Indemnitee has requested
indemnification.
(ii) The Indemnitee's entitlement to indemnification under this
Article shall be determined in one of the following ways: (A) by a
majority vote of the Disinterested Directors (as hereinafter defined),
if they constitute a quorum of the Board of Directors; (B) by a written
opinion of Independent Counsel (as hereinafter defined) if a quorum of
the board of Directors consisting of Disinterested Directors is not
obtainable or, even if obtainable, a majority of such Disinterested
Directors so directs; (C) by the stockholders of the Company entitled
to vote; or (D) as provided in Section B-4(c) of this Article.
(iii) In the event the determination of entitlement to
indemnification is to be made by Independent Counsel pursuant to
Section B-4(b)(ii) of this Article, a majority of the Disinterested
Directors shall select the Independent Counsel, but only an Independent
Counsel to which the Indemnitee does not reasonably object.
(c) Presumptions and Effect of Certain Proceedings. Except as
otherwise expressly provided in this Article, the Indemnitee shall be
presumed to be entitled to indemnification under this Article upon
submission of a request for indemnification together with the Supporting
Documentation in accordance with Section B-4(b)(i), and thereafter the
Company shall have the burden of proof to overcome that presumption in
reaching a contrary determination. In any event, if the person or persons
empowered under Section B-4(b) of this Article to determine within 60 days
after the receipt by the Company of the request therefor together with the
Supporting Documentation, the Indemnitee shall be entitled to
indemnification unless (A) the Indemnitee misrepresented or failed to
disclose a material fact in making the request for indemnification or in
the Supporting Documentation or (B) such indemnification is prohibited by
law. The termination of any Proceeding described in Section B-1, or of
any claim, issue or matter therein, by judgment, order, settlement or
conviction, or upon a plea of nolo contendere or its equivalent, shall
not, of itself, adversely affect the right of the Indemnitee to
indemnification or create a presumption that the Indemnitee did not act in
good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Company or, with respect to any
criminal proceeding, that the Indemnitee had reasonable cause to believe
that his conduct was unlawful.
(d) Remedies of Indemnitee. (i) In the event that a determination is
made pursuant to Section B-4(b) of this Article that the Indemnitee is not
entitled to indemnification under this Article, (A) the Indemnitee shall
be entitled to seek an adjudication of his entitlement to such
indemnification either, at the Indemnitee's sole option, in (x) an
appropriate court of the State of Delaware or any other court of competent
jurisdiction or (y) an arbitration to be conducted by a single arbitrator
pursuant to the rules of the American Arbitration Association; (B) any
such judicial proceeding or arbitration shall be de novo and the
Indemnitee shall not be prejudiced by reason of such adverse
determination; and (C) in any such judicial proceeding or arbitration the
Company shall have the burden of proving that the Indemnitee is not
entitled to indemnification under this Article.
II-3
<PAGE>
(ii) If a determination shall have been made or deemed to have been
made, pursuant to Section B-4(b) or (c), that the Indemnitee is entitled
to indemnification, the Company shall be obligated to pay the amounts
constituting such indemnification within five days after such
determination has been made or deemed to have been made and shall be
conclusively bound by such determination unless (A) the Indemnitee
misrepresented or failed to disclose a material fact in making the request
for indemnification or in the Supporting Documentation or (B) such
indemnification is prohibited by law. In the event that (C) advancement
of expenses is not timely made pursuant to Section B-4(a) or (D) payment
of indemnification is not made within five days after a determination if
entitlement to indemnification has been made or deemed to have been made
pursuant to Section B-4(b) or (c), the Indemnitee shall be entitled to
seek judicial enforcement of the Company's obligation to pay to the
Indemnitee such advancement of expenses or indemnification.
Notwithstanding the foregoing, the Company may bring an action, in an
appropriate court of the State of Delaware or any other court of competent
jurisdiction, contesting the right of the Indemnitee to receive
indemnification hereunder due to the occurrence of an event described in
subclause (A) or (B) of this clause (ii) (a "Disqualifying Event");
provided, however, that in any such action the Company shall have the
burden or proving the occurrence of such Disqualifying Event.
(iii) The Company shall be precluded from asserting in any judicial
proceeding or arbitration commenced pursuant to this Section B-4(d) that
the procedures and presumptions of this Article are not valid, binding and
enforceable and shall stipulate in any such court or before any such
arbitrator that the Company is bound by all the provisions of this
Article.
(iv) In the event that the Indemnitee, pursuant to this Section B-
4(d), seeks a judicial adjudication of or an award in arbitration to
enforce his rights under, or to recover damages for breach of, this
Article, the Indemnitee shall be entitled to recover from the Company, and
shall be indemnified by the Company against, any expenses actually and
reasonably incurred by him if the Indemnitee prevails in such judicial
adjudication. If it shall be determined in such judicial adjudication or
arbitration that the Indemnitee is entitled to receive part but not all of
the indemnification or advancement of expenses sought, the expenses
incurred by the Indemnitee in connection with such judicial adjudication
or arbitration shall be prorated accordingly.
(e) Definitions. For purposes of this Section B-4:
(i) "Disinterested Director" means a director of the Company who is
not or was not a party to the Proceeding in respect of which
indemnification is sought by the Indemnitee.
(ii) "Independent Counsel" means a law firm or a member of a law firm
that neither presently is, nor in the past five years has been,
retained to represent (A) the Company or the Indemnitee in any matter
material to either such party or (B) any other party to the Proceeding
giving rise to a claim for indemnification under this Article.
Notwithstanding the foregoing, the term "Independent Counsel" shall not
include any person who, under the applicable standards of professional
conduct then prevailing under the law of the State of Delaware, would
have a conflict of interest in representing either the Company or the
Indemnitee in an action to determine the Indemnitee's rights under this
Article.
(5) Severability. If any provisions of this Article shall be held to be
invalid, illegal or unenforceable for any reason whatsoever: (a) the
validity, legality and enforceability of
II-4
<PAGE>
the remaining provisions of this Article (including, without limitation, all
portions of any paragraph of this Article containing any such provision held
to be invalid, illegal or unenforceable that are not themselves invalid,
illegal or unenforceable) shall not in any way be affected or impaired
thereby; and (b) to the fullest extent possible, the provisions of this
Article (including, without limitation, all portions of any paragraph of this
Article containing any such provision held to be invalid, illegal or
unenforceable that are not themselves invalid, illegal or unenforceable)
shall be construed so as to give effect to the intent manifested by the
provision held invalid, illegal or unenforceable.
The Registrant has purchased directors' and officers liability insurance
covering many of the possible actions and omissions of persons acting or failing
to act in such capacities.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable.
ITEM 8. EXHIBITS.*
4(a) Registrant's Certificate of Incorporation, as amended.
4(b) Registrant's Bylaws hereby incorporated by reference from Exhibit
3.3 to the Registrant's Registration Statement on Form S-1 dated filed with the
Commission on August 19, 1993 with Registration No. 33-67662.
4(c) Friedman's Inc. Amended and Restated 1994 Stock Option Plan for
Outside Directors.
5 Opinion of counsel of Registrant.
23(a) Consent of counsel (included in Exhibit 5).
23(b) Consent of Ernst & Young LLP.
24 Power of Attorney (contained on page II-8).
_____________
* Exhibits are numbered in accordance with Item 601 of Regulation S-K.
II-5
<PAGE>
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the registration statement;
and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change in such information in the registration statement;
provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii) above do not
-------- -------
apply if the registration statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned issuer hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of l934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities and Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and controlling
persons of the registrant pursuant to the provisions described in Item 6 of this
Part II, or otherwise, the registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer,
or controlling person of the registrant in the successful defense of any action,
suit, or proceeding) is asserted by such director, officer, or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-6
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933, the registrant,
Friedman's Inc., certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Savannah, State of Georgia, on the 21 day of
March, 1997.
FRIEDMAN'S INC.
Registrant
By: /s/ Bradley J. Stinn
--------------------
Bradley J. Stinn
Chief Executive Officer
(Principal Executive Officer)
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities on March 21, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Bradley J. Stinn Chairman of the Board of Directors, Chief
- - ------------------------------------------ Executive Officer and Interim Chief Financial
Bradley J. Stinn Officer (Principal Executive, Financial and
Accounting Officer)
/s/ Sterling B. Brinkley Director
- - ------------------------------------------
Sterling B. Brinkley
/s/ John E. Cay III Director
- - ------------------------------------------
John E. Cay III
/s/ Robert W. Cruickshank Director
- - ------------------------------------------
Robert W. Cruickshank
President, Chief Operating Officer and Director
- - ------------------------------------------
Robert S. Morris
/s/ David B. Parshall Director
- - ------------------------------------------
David B. Parshall
/s/ Mark C. Pickup Director
- - ------------------------------------------
Mark C. Pickup
</TABLE>
II-7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER* DESCRIPTION
- - -------------- -----------
<S> <C>
4(a) Registrant's Certificate of Incorporation, as amended.
4(c) Friedman's Inc. Amended and Restated 1994 Stock Option
Plan for Outside Directors.
5 Opinion of counsel to Registrant.
23(a) Consent of counsel (included in Exhibit 5).
23(b) Consent of Ernst & Young LLP.
24 Power of Attorney (contained on page II-8).
</TABLE>
______________
*Exhibits are numbered in accordance with Item 601 of Regulation S-K.
<PAGE>
EXHIBIT 4(A)
------------
Registrant's Certificate of Incorporation, as amended
<PAGE>
CERTIFICATE OF INCORPORATION
OF
FRIEDMAN'S INC.
FIRST: The name of the corporation (hereinafter the "Company") is
FRIEDMAN'S INC.
SECOND: The respective names of the County and of the City within
the County in which the registered office of the Company is to be located in the
State of Delaware are the County of New Castle and the City of Wilmington. The
name of the registered agent of the Company is The Corporation Trust Company.
The street and number of said registered office and the address by street and
number of said registered agent is 1209 Orange Street in the City of Wilmington.
THIRD: The nature of the business of the Company and the objects
and purposes to be transacted, promoted or carried on by it are as follows:
(1) To engage in the jewelry business;
(2) To engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of the State of Delaware.
Notwithstanding any provision of this Certificate of Incorporation, the Company
shall not have power to carry on the business of constructing, maintaining or
operating public utilities within the State of Delaware; nor shall anything
herein be deemed to authorize the Company to carry on any business or exercise
any power in any state, district, territory, possession or country which under
the laws thereof the Company may not lawfully carry on or exercise.
FOURTH: The total number of shares of all classes of stock which the
Company shall have authority to issue is 3,000, consisting of 1,000 shares of
Preferred Stock, par value $.01 per share (hereinafter called the "Preferred
Stock"), 1,000 shares of Class A Common Stock, par value $.01 per share
(hereinafter called the "Class A Stock"), and 1,000 shares of Class B Common
Stock, par value $.01 per share (hereinafter called the "Class B Stock," and the
Class A Stock and Class B Stock being hereinafter collectively called the
"Common Stock").
The designations and the powers, preferences and rights, and the
qualifications, limitations or restrictions thereof, of each class of stock of
the Company which are fixed by this Certificate of Incorporation, and the
express grant of authority to the Board of Directors to fix by resolution or
resolutions the designations, and the powers, preferences and rights, and the
qualifications, limitations or restrictions thereof, of the Preferred Stock
which are not fixed by this Certificate of Incorporation, are as follows:
A. Preferred Stock
(1) Upon the affirmative vote or the written consent of the holders
of a majority of the outstanding shares of Class B Stock, shares of
Preferred Stock may be issued from time to time in one or more series, each
such series to have such distinctive designation as shall be stated and
expressed in the resolution or resolutions adopted by the Board of
Directors providing for the initial
<PAGE>
issuance of shares of such series, and authority is expressly vested in the
Board of Directors, by such resolution or resolutions providing for the
initial issuance of shares of each series:
(a) To fix the distinctive designation of such series and the
number of shares which shall constitute such series, which number may
be increased or decreased (but not below the number of shares thereof
then outstanding) from time to time by action of the Board of
Directors;
(b) To fix (i) the dividend rate of such series, (ii) any
limitations, restrictions or conditions on the payment of dividends,
including whether dividends shall be cumulative and, if so, from which
date or dates, (iii) the relative rights of priority, if any, of
payment of dividends on shares of that series and (iv) the form of
dividends, which shall be payable either (A) in cash only, or (B) in
stock only, or (C) partly in cash and partly in stock, or (D) in stock
or, at the option of the holder, in cash (and in such case to
prescribe the terms and conditions of exercising such option), and to
make provision in case of dividends payable in stock for adjustment of
the dividend rate in such events as the Board of Directors shall
determine;
(c) To fix the price or prices at which, and the terms and
conditions on which, the shares of such series may be redeemed by the
Company;
(d) To fix the amount or amounts payable upon the shares of such
series in the event of any liquidation, dissolution or winding up of
the Company and the relative rights of priority, if any, of payment
upon shares of such series;
(e) To determine whether or not the shares of such series shall
be entitled to the benefit of a sinking fund to be applied to the
purchase or redemption of such series and, if so entitled, the amount
of such fund and the manner of its application;
(f) To determine whether or not the shares of such series shall
be made convertible into, or exchangeable for, shares of any other
class or classes of stock of the Company or shares of any other series
of Preferred Stock, and, if made so convertible or exchangeable, the
conversion price or prices, or the rate or rates of exchange, and the
adjustments thereof, if any, at which such conversion or exchange may
be made, and any other terms and conditions of such conversion or
exchange;
(g) To determine whether or not the shares of such series shall
have any voting powers and, if voting powers are so granted, the
extent of such voting powers; provided, however, that (i) so long as
any Class B Stock shall be outstanding the holders of the Class B
Stock shall always have the absolute right under all conditions and
circumstances to elect a majority of the directors; and (ii) if voting
powers are so granted, the holders of shares of Preferred Stock shall
be entitled to vote together with the holders of the Class A Stock as
a class on all matters upon which holders of shares of Class A Stock
are entitled to vote. Subject to the foregoing and except as otherwise
provided by statute, the holders of shares of Preferred Stock, as such
holders, shall not have any right to vote in the election of directors
or for any other purpose; and such holders shall not be entitled to
notice of any meeting of stockholders at which they are not entitled
to vote;
(h) To determine whether or not the issue of any additional
shares of such series or of any other series in addition to such
series shall be subject to restrictions in addition to the
restrictions, if any, on the issue of additional shares imposed in the
resolution or resolutions fixing the terms of any outstanding series
of Preferred Stock theretofore issued pursuant to this Section A and,
if subject to additional restrictions, the extent of such additional
restrictions; and
<PAGE>
(i) Generally to fix the other rights, and any qualifications,
limitations or restrictions of such rights, of such series; provided,
however, that no such rights, qualifications, limitations or
restrictions shall be in conflict with this Certificate of
Incorporation or any amendment hereof.
(2) Before any dividends shall be declared or paid or any
distribution ordered or made upon the Common Stock (other than a dividend
payable in Common Stock), the Company shall comply with the dividend and
sinking fund provisions, if any, of any resolution or resolutions providing
for the issue of any series of Preferred Stock any shares of which shall at
the time be outstanding. Subject to the foregoing sentence, the holders of
Common Stock shall be entitled, to the exclusion of the holders of
Preferred Stock of any and all series, to receive such dividends as from
time to time may be declared by the Board of Directors.
(3) Upon any liquidation, dissolution or winding up of the Company,
the holders of Preferred Stock of each series shall be entitled to receive
the amounts to which such holders are entitled as fixed with respect to
such series, including all dividends accumulated to the date of final
distribution, before any payment or distribution of assets of the Company
shall be made to or set apart for the holders of Common Stock; and after
such payments shall have been made in full to the holders of Preferred
Stock, the holders of Common Stock shall be entitled to receive any and all
assets remaining to be paid or distributed to stockholders and the holders
of Preferred Stock shall not be entitled to share therein. For the purposes
of this paragraph, the voluntary sale, conveyance, lease, exchange or
transfer of all or substantially all the property or assets of the Company
or a consolidation or merger of the Company with one or more other
corporations (whether or not the Company is the corporation surviving such
consolidation or merger) shall not be deemed to be a liquidation,
dissolution or winding up, voluntary or involuntary.
(4) Subject to such limitations (if any) as may be fixed by the Board
of Directors with respect to such series of Preferred Stock in accordance
with paragraph (1) of this Section A, Preferred Stock of each series may be
redeemed at any time in whole or from time to time in part, at the option
of the Company, by vote of the Board of Directors, at the redemption price
thereof fixed in accordance with said paragraph (1). If less than all the
outstanding shares of Preferred Stock of such series are to be redeemed,
the shares to be redeemed shall be determined in such manner as the Board
of Directors shall prescribe. At such time or times prior to the date fixed
for redemption as the Board of Directors shall determine, written notice
shall be mailed to each holder of record of shares to be redeemed, in a
postage prepaid envelope addressed to such holder at his address as shown
by the records of the Company, notifying such holder of the election of the
Company to redeem such shares and stating the date fixed for the redemption
thereof and calling upon such holder to surrender to the Company on or
after said date, at a place designated in such notice, his certificate or
certificates representing the number of shares specified in such notice of
redemption. On and after the date fixed in such notice of redemption, each
holder of shares of Preferred Stock to be redeemed shall present and
surrender his certificate or certificates for such shares to the Company at
the place designated in such notice and thereupon the redemption price of
such shares shall be paid to or on the order of the person whose name
appears on the records of the Company as the holder of the shares
designated for redemption. In case less than all the shares represented by
any such certificate are redeemed a new certificate shall be issued
representing the unredeemed shares. From and after the date fixed in any
such notice as the date of redemption (unless default shall be made by the
Company in payment of the redemption price) all dividends on the shares of
Preferred Stock designated for redemption in such notice shall cease to
accrue and all rights of the holders thereof as stockholders of the
Company, other than to receive the redemption price, shall terminate and
such shares shall not thereafter be transferred (except with the consent of
the Company) on the books of the Company and such shares shall not be
deemed to be outstanding for any purpose whatsoever. At any time after the
mailing of any such notice of redemption the Company may deposit the
redemption price of the shares designated therein for redemption with a
bank or trust company in the Borough of Manhattan, City and State of New
York, or in the City of Atlanta,
<PAGE>
Georgia, having capital and surplus of at least $25,000,000, in trust for
the benefit of the respective holders of the shares designated for
redemption but not yet redeemed. From and after the making of such deposit
the sole right of the holders of such shares shall be the right either to
receive the redemption price of such shares on and after such redemption
date, or, in the case of shares having conversion rights, the right to
convert the same at any time at or before the earlier of the close of
business on such redemption date or such prior date and time at which the
right to convert shall have expired; and except for these rights, the
shares of Preferred Stock so designated for redemption shall not be deemed
to be outstanding for any purpose whatsoever.
(5) Shares of any series of Preferred Stock which have been redeemed
(whether through the operation of a sinking fund or otherwise) or purchased
by the Company, or which, if convertible, have been converted into shares
of stock of the Company of any other class or classes, may, upon
appropriate filing and recording to the extent required by law, have the
status of authorized and unissued shares of Preferred Stock and may be
reissued as a part of such series or of any other series of Preferred
Stock, subject to such limitations (if any) as may be fixed by the Board of
Directors with respect to such series of Preferred Stock in accordance with
paragraph (1) of this Section A.
B. Common Stock
(1) Except as otherwise provided by (a) the Board of Directors in
fixing the voting rights of any series of the Preferred Stock in accordance
with Section A of this Article Fourth, (b) this Section B or (c) statute,
voting power in the election of directors and for all other purposes shall
be vested exclusively in the holders of Class B Stock. The number of
authorized shares of Preferred Stock, Class A Stock, Class B Stock or any
other capital stock of the Company may be increased or decreased (but not
below the number of shares thereof then outstanding) by the affirmative
vote or the written consent of the holders of a majority of the outstanding
shares of Class B Stock. Any director elected by the holders of Class B
Stock (and any successor to such director) shall be subject to removal
without cause and to replacement from time to time by the affirmative vote
or written consent of the holders of a majority of the outstanding shares
of Class B Stock. Every holder of stock of a class entitled to vote upon a
matter shall be entitled to one vote for each share of stock of such class
standing in his name upon the books of the Company. Except as otherwise
provided by this Section B and by Section C of this Article Fourth, there
shall be no distinction whatever between the rights accorded to the holders
of Class A Stock and Class B Stock.
(2) With regard to the election of directors, holders of Class A
Stock shall be entitled, voting separately as a class, to elect 25 percent
of the directors (rounding the number of such directors to the next highest
whole number if such percentage is not equal to a whole number of
directors) and no more, to remove any director elected by the holders of
Class A Stock (and any successor to such director) and, in the manner
provided in the Bylaws of the Company, to replace any director so removed.
If at any time there shall not be any Class B Stock outstanding, the
provisions of this Certificate of Incorporation which provide limited and
separate voting rights for the holders of the Class A Stock shall cease to
be of any effect, and such holders shall thereafter have general voting
power in the election of directors and in all other matters upon which
stockholders of the Company are entitled to vote pursuant to this
Certificate of Incorporation, the Bylaws of the Company or statute.
(3) A holder of shares of Class B Stock shall be entitled at any time
and from time to time to convert any or all such shares held by him into
shares of Class A Stock in the ratio of one share of Class A Stock for one
share of Class B Stock. Each conversion of shares of Class B Stock into
shares of Class A Stock made pursuant to the provisions of this paragraph
(3) shall be effected by the surrender of the certificate representing the
shares to be converted at the office of the Secretary of the Company (or at
such additional place or places as may from time to time be designated by
the Secretary or any Assistant Secretary of the Company) in such form and
accompanied by all stock transfer tax stamps, if any, as shall be requisite
for such transfer, and upon such surrender the holder
<PAGE>
of such shares shall be entitled to become, and shall be registered on the
books of the Company as, the holder of the number of shares of Class A
Stock issuable upon such conversion, and each such share of Class B Stock
shall be converted into one share of Class A Stock, as the Class A Stock
shall then be constituted, and thereupon there shall be issued and
delivered to such holder or other named person, as the case may be,
promptly at such office or other designated place, a certificate or
certificates for such number of shares of Class A Stock.
(4) Upon the affirmative vote or the written consent of the holders
of a majority of the outstanding shares of Class B Stock, all or any part
of the entire class of outstanding Class B Stock shall be converted,
effective upon the date specified in such vote or consent, into shares of
Class A Stock in the ratio of one share of Class A Stock for one share of
Class B Stock. Any conversion pursuant to this paragraph (4) of less than
all the outstanding shares of Class B Stock shall be effected through the
conversion of an equal percentage of such shares held by each holder of
Class B Stock (including any holder who shall not have given his
affirmative vote or written consent). Any fractional share of Class B Stock
resulting from the application of such percentage shall not be eliminated
and shall exist as a fractional share of Class B Stock and the holder
thereof shall be entitled to exercise voting rights, to receive dividends
thereon, to participate in any of the assets of the Company in the event of
liquidation and to all other rights in respect of Class B Stock to the
extent of such fractional share; but any fractional share of Class A Stock
shall be eliminated and in lieu thereof the Company shall issue scrip or
pay cash as provided in paragraph (5) of this Section B. Upon the effective
date of any conversion pursuant to this paragraph (4), certificates
representing the shares of Class B Stock so converted shall thereafter
represent a like number of shares of Class A Stock, and each holder thereof
shall be registered on the books of the Company as the record holder of
such number of shares of Class A Stock. Upon presentation and surrender of
said certificates at the office of the Secretary of the Company (or at such
additional place or places as may from time to time be designated by the
Secretary or any Assistant Secretary of the Company) the Company shall
issue or cause to be issued certificates representing the whole number of
shares of Class A Stock resulting from such conversion, and shall issue
scrip or pay cash in lieu of any fractional share eliminated upon such
conversion, and shall issue or cause to be issued certificates representing
the number of whole shares and any fractional shares of Class B Stock
remaining after such conversion.
(5) Fractional shares of Class B Stock shall be issued upon and in
connection with any conversion, split-up, merger, consolidation,
reclassification, stock dividend or other change in so far as the same
shall affect Class B Stock. A certificate for a fractional share of Class B
Stock so issued shall entitle the holder to exercise voting rights, to
receive dividends thereon, to participate in any of the assets of the
Company in the event of liquidation and to all other rights in respect of
Class B Stock to the extent of such fractional share. No fractional share
of stock of any other class of the Company now or hereafter authorized
shall be issuable upon or in connection with any other conversion, split-
up, merger, consolidation, reclassification, stock dividend or change
involving stock of such other class; in lieu of any such fractional share,
the person entitled to an interest in respect of such a fractional share
shall be entitled, as determined from time to time by the Board of
Directors, to either (i) a scrip certificate for such fractional share with
such terms and conditions as the Board of Directors shall prescribe or (ii)
the cash equivalent of any such fractional share based upon the market
value of shares of such class at the date on which rights in respect of any
such fractional share shall accrue, as determined in good faith by the
Board of Directors.
(6) Subject to the prior rights of the holders of the Preferred Stock
contained in this Article Fourth, when and as dividends are declared,
whether payable in cash, in property or in shares of stock of the Company
(except as hereinafter provided in this paragraph (6)), the holders of
Class A Stock and the holders of Class B Stock shall be entitled to share
equally, share for share, in such dividends. A dividend payable in shares
of Class A Stock to the holders of Class A Stock and in shares of Class B
Stock to the holders of Class B Stock shall be deemed to be shared equally
among both classes. No dividends shall be declared or paid in shares of
Class B Stock except to holders of
<PAGE>
Class B Stock, but dividends may be declared and paid, as determined by the
Board of Directors, in shares of Class A Stock to all holders of Common
Stock.
(7) In the event of any liquidation, dissolution or winding up of the
Company, either voluntary or involuntary, after payment shall have been
made to the holders of the Preferred Stock of the full amount to which they
shall be entitled pursuant to paragraph (3) of Section A of this Article
Fourth, the holders of Common Stock shall be entitled, to the exclusion of
the holders of the Preferred Stock of any and all series, to share, ratably
according to the number of shares of Common Stock held by them, in all
remaining assets of the Company available for distribution to its
stockholders.
C. Issuance of Stock; Negation of Preemptive Rights
Without the affirmative vote or written consent of the holders of a
majority of the outstanding shares of Class B Stock, the Company shall not
issue or sell any shares of Class B Stock or any obligation or security
that shall be convertible into, or exchangeable for, or entitle the holder
thereof to subscribe for or purchase, any shares of Class B Stock. Except
as expressly provided in this Section C or as the Board of Directors in its
discretion may by resolution determine, no holder of stock of the Company
of any class shall have any right to subscribe for or purchase any shares
of stock of the Company of any class now or hereafter authorized or any
obligations or securities which the Company may hereafter issue or sell
that shall be convertible into, or exchangeable for, or entitle the holders
thereof to subscribe for or purchase, any shares of any such class of stock
of the Company.
D. Rights or Options
Subject to Section C of this Article Fourth, the Company shall have
the power to create and issue, whether or not in connection with the issue
and sale of any shares of stock or other securities of the Company, rights
or options entitling the holders thereof to purchase from the Company any
shares of its capital stock of any class or classes at the time authorized,
such rights or options to be evidenced by or in such instrument or
instruments as shall be approved by the Board of Directors. The terms upon
which, the time or times, which may be limited or unlimited in duration, at
or within which, and the price or prices at which any such rights or
options may be issued and any such shares may be purchased from the Company
upon the exercise of any such right or option shall be such as shall be
fixed and stated in a resolution or resolutions adopted by the Board of
Directors providing for the creation and issue of such rights or options
and, in every case, set forth or incorporated by reference in the
instrument or instruments evidencing such rights or options. In the absence
of actual fraud in the transaction, the judgment of the Board of Directors
as to the consideration for the issuance of such rights or options and the
sufficiency thereof shall be conclusive.
E. Unclaimed Dividends
Any and all right, title, interest and claim in or to any dividends
declared, or other distributions made, by the Company, whether in cash,
stock or otherwise, which are unclaimed by the stockholder entitled thereto
for a period of three years after the close of business on the payment
date, shall be and be deemed to be extinguished and abandoned; and such
unclaimed dividends or other distributions in the possession of the
Company, its transfer agents or other agents or depositaries shall at such
time become the absolute property of the Company, free and clear of any and
all claims of any persons or other entities whatsoever.
FIFTH: The private property of the stockholders of the Company
shall not be subject to the payment of corporate debts to any extent whatsoever.
<PAGE>
SIXTH: Whenever a compromise or arrangement is proposed between the
Company and its creditors or any class of them and/or between the Company and
its stockholders or any class of them, any court of equitable jurisdiction
within the State of Delaware may, on the application in a summary way of the
Company or of any creditor or stockholder of the Company or on the application
of any receiver or receivers appointed for the Company under the provisions of
Section 291 of Title 8 of the Delaware Code or on the application of trustees in
dissolution or of any receiver or receivers appointed for the Company under the
provisions of Section 279 of Title 8 of the Delaware Code order a meeting of the
creditors or class of creditors and/or of the stockholders or class of
stockholders of the Company, as the case may be, to be summoned in such manner
as the said court directs. If a majority in number representing three-fourths in
value of the creditors or class of creditors, and/or of the stockholders or
class of stockholders of the Company, as the case may be, agree to any
compromise or arrangement and to any reorganization of the Company as a
consequence of such compromise or arrangement, the said compromise or
arrangement and the said reorganization shall, if sanctioned by the court to
which the said application has been made, be binding on all the creditors or
class of creditors, and/or on all the stockholders or class of stockholders, of
the Company, as the case may be, and also on the Company.
SEVENTH: In furtherance and not in limitation of the powers conferred
by the laws of the State of Delaware, the Board of Directors, subject to the
provisions of this Certificate of Incorporation, is expressly authorized and
empowered:
(a) To make, alter, amend or repeal the Bylaws of the Company in any
manner not inconsistent with the laws of the State of Delaware or this
Certificate of Incorporation, subject to the power of the stockholders to
amend, alter or repeal the Bylaws made by the Board of Directors or to
limit or restrict the power of the Board of Directors so to make, alter,
amend or repeal the Bylaws; provided, however, that so long as any Class B
Stock shall remain outstanding the minimum number of directors shall be the
lowest number required for the holders of Class B Stock to have the
absolute power under all conditions and circumstances to elect a majority
of the directors.
(b) Subject to the applicable provisions of the Bylaws, to determine
from time to time, whether and to what extent and at what times and places
and under what conditions and regulations the accounts and books and
documents of the Company, or any of them, shall be open to the inspection
of the stockholders, and no stockholder shall have any right to inspect any
account or book or document of the Company, except as conferred by the laws
of the State of Delaware, unless and until authorized so to do by
resolution adopted by the Board of Directors or the stockholders of the
Company entitled to vote in respect thereof.
(c) Without the assent or vote of the stockholders, to authorize and
issue obligations of the Company, secured or unsecured, to include therein
such provisions as to redeemability, convertibility or otherwise, as the
Board of Directors in its sole discretion may determine, and to authorize
the mortgaging or pledging, as security therefor, of any property of the
Company, real or personal, including after-acquired property.
(d) To fix and determine, and to vary the amount of, the working
capital of the Company; to determine whether any, and if any, what part of
any, accumulated profits shall be declared in dividends and paid to the
stockholders; to determine the time or times for the declaration and
payment of dividends; to direct and to determine the use and disposition of
any surplus or net profits over and above the capital stock paid in; and in
its discretion the Board of Directors may use or apply any such surplus or
accumulate profits in the purchase or acquiring of bonds or other pecuniary
obligations of the Company to such extent, in such manner and upon such
terms as the Board of Directors may deem expedient.
(e) To sell, lease or otherwise dispose of, from time to time, any
part or parts of the properties of the Company and to cease to conduct the
business connected therewith or again to resume the same, as it may deem
best.
<PAGE>
In addition to the powers and authorities hereinbefore or by statute
expressly conferred upon it, the Board of Directors may exercise all such powers
and do all such acts and things as may be exercised or done by the Company,
subject, nevertheless, to the provisions of the laws of the State of Delaware,
of this Certificate of Incorporation and of the Bylaws of the Company.
EIGHTH: No contract or transaction between the Company and one or
more of its directors or officers, or between the Company and any other
corporation, partnership, association or other organization in which one or more
of its directors or officers are directors or officers or have a financial
interest, shall be void or voidable solely for such reason, or solely because
such director or officer is present at or participates in the meeting of the
Board of Directors or committee thereof which authorizes such contract or
transaction, or solely because such director is counted in determining the
presence of a quorum at such meeting and votes upon the authorization of such
contract or transaction, if (a) the material facts as to such director's or
officer's relationship or interest and as to the contract or transaction are
disclosed or are known to the Board of Directors or the committee, and the Board
of Directors or the committee in good faith authorizes the contract or
transaction by the affirmative vote of a majority of the disinterested members
thereof, even though such disinterested members be less than a quorum, or (b)
the material facts as to such director's or officer's relationship or interest
and as to the contract or transaction are disclosed or are known to the
stockholders entitled to vote thereon, and the contract or transaction is
specifically approved in good faith by such stockholders, or (c) the contract or
transaction is fair as to the Company as of the time it is authorized, approved
or ratified by the Board of Directors, a committee thereof, or the stockholders.
Common or interested directors may be counted in determining the presence of a
quorum at a meeting of the Board of Directors or of a committee which authorizes
the contract or transaction.
NINTH: Limitation of Liability; Indemnification
A. Limitation of Directors' Liability
To the fullest extent that the General Corporation Law of the State of
Delaware, as it exists on the date hereof or as it may hereafter be
amended, permits the limitation or elimination of the liability of
directors, no director of the Company shall be liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty as a
director. No amendment to or repeal of this Section A of this Article shall
apply to or have any effect on the liability or alleged liability of any
director of the Company for or with respect to any acts or omissions of
such director occurring prior to such amendment or repeal.
B. Indemnification
1. Right to Indemnification. The Company shall to the fullest extent
permitted by applicable law as then in effect indemnify any person (the
"Indemnitee") who was or is involved in any manner (including, without
limitation, as a party or witness) or is threatened to be made so involved
in any threatened, pending or completed investigation, claim, action, suit
or proceeding, whether civil, criminal, administrative or investigative
(including, without limitation, any action, suit or proceeding by or in the
right of the Company to procure a judgment in its favor) (a "Proceeding")
by reason of the fact that he is or was a director, officer, employee or
agent of the Company, or is or was serving at the request of the Company as
a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise (including, without limitation,
any employee benefit plan) against all expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such Proceeding. Such
indemnification shall be a contract right and shall include the right to
receive payment in advance of any expenses incurred by the Indemnitee in
connection with such Proceeding, consistent with the provisions of
applicable law as then in effect.
<PAGE>
2. Insurance, Contracts and Funding. The Company may purchase and
maintain insurance to protect itself and any Indemnitee against any
expenses, judgments, fines and amounts paid in settlement as specified in
Section B-1 of this Article or incurred by any Indemnitee in connection
with any Proceeding referred to in Section B-1 of this Article, to the
fullest extent permitted by applicable law as then in effect. The Company
may enter into contracts with any director, officer, employee or agent of
the Company in furtherance of the provisions of this Article and may create
a trust fund, grant a security interest or use other means (including,
without limitation, a letter of credit) to ensure the payment of such
amounts as may be necessary to effect indemnification as provided in this
Article.
3. Indemnification Not Exclusive Right. The right of indemnification
provided in this Article shall not be exclusive of any other rights to
which those seeking indemnification may otherwise be entitled, and the
provisions of this Article shall inure to the benefit of the heirs and
legal representatives of any person entitled to indemnity under this
Article and shall be applicable to proceedings commenced or continuing
after the adoption of this Article, whether arising from acts or omissions
occurring before or after such adoption.
4. Advancement of Expenses; Procedures; Presumptions and Effects of
Certain Proceedings; Remedies. In furtherance but not in limitation of the
foregoing provisions, the following procedures, presumptions and remedies
shall apply with respect to the advancement of expenses and the right to
indemnification under this Article:
(a) Advancement of Expenses. All reasonable expenses incurred by
or on behalf of an Indemnitee in connection with any Proceeding shall
be advanced to the Indemnitee by the Company within 20 days after the
receipt by the Company of a statement or statements from the
Indemnitee requesting such advance or advances from time to time,
whether prior to or after final disposition of such Proceeding. Such
statement or statements shall reasonably evidence the expenses
incurred by the Indemnitee and, if required by law at the time of such
advance, shall include or be accompanied by an undertaking by or on
behalf of the Indemnitee to repay the amounts advanced if it should
ultimately be determined that the Indemnitee is not entitled to be
indemnified against such expenses pursuant to this Article.
(b) Procedure for Determination of Entitlement to
Indemnification. (i) To obtain indemnification under this Article, an
Indemnitee shall submit to the Secretary of the Company a written
request, including such documentation as is reasonably available to
the Indemnitee and reasonably necessary to determine whether and to
what extent the Indemnitee is entitled to indemnification (the
"Supporting Documentation"). The determination of the Indemnitee's
entitlement to indemnification shall be made not later than 60 days
after receipt by the Company of the written request for
indemnification together with the Supporting Documentation. The
Secretary of the Company shall, promptly upon receipt of such a
request for indemnification, advise the Board of Directors in writing
that the Indemnitee has requested indemnification.
(ii) The Indemnitee's entitlement to indemnification under this
Article shall be determined in one of the following ways: (A) by a
majority vote of the Disinterested Directors (as hereinafter
defined), if they constitute a quorum of the Board of Directors;
(B) by a written opinion of Independent Counsel (as hereinafter
defined) if a quorum of the Board of Directors consisting of
Disinterested Directors is not obtainable or, even if obtainable, a
majority of such Disinterested Directors so directs; (C) by the
stockholders of the Company entitled to vote; or (D) as provided in
Section B-4(c) of this Article.
(iii) In the event the determination of entitlement to
indemnification is to be made by Independent Counsel pursuant to
Section B-4(b)(ii) of this Article, a majority of the
<PAGE>
Disinterested Directors shall select the Independent Counsel, but
only an Independent Counsel to which the Indemnitee does not
reasonably object.
(c) Presumptions and Effect of Certain Proceedings. Except as
otherwise expressly provided in this Article, the Indemnitee shall be
presumed to be entitled to indemnification under this Article upon
submission of a request for indemnification together with the
Supporting Documentation in accordance with Section B-4(b)(i), and
thereafter the Company shall have the burden of proof to overcome that
presumption in reaching a contrary determination. In any event, if the
person or persons empowered under Section B-4(b) of this Article to
determine entitlement to indemnification shall not have been appointed
or shall not have made a determination within 60 days after the
receipt by the Company of the request therefor together with the
Supporting Documentation, the Indemnitee shall be entitled to
indemnification unless (A) the Indemnitee misrepresented or failed to
disclose a material fact in making the request for indemnification or
in the Supporting Documentation or (B) such indemnification is
prohibited by law. The termination of any Proceeding described in
Section B-1, or of any claim, issue or matter therein, by judgment,
order, settlement or conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, adversely affect the right of
the Indemnitee to indemnification or create a presumption that the
Indemnitee did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of
the Company or, with respect to any criminal Proceeding, that the
Indemnitee had reasonable cause to believe that his conduct was
unlawful.
(d) Remedies of Indemnitee. (i) In the event that a
determination is made pursuant to Section B-4(b) of this Article that
the Indemnitee is not entitled to indemnification under this Article,
(A) the Indemnitee shall be entitled to seek an adjudication of his
entitlement to such indemnification either, at the Indemnitee's sole
option, in (x) an appropriate court of the State of Delaware or any
other court of competent jurisdiction or (y) an arbitration to be
conducted by a single arbitrator pursuant to the rules of the American
Arbitration Association; (B) any such judicial proceeding or
arbitration shall be de novo and the Indemnitee shall not be
prejudiced by reason of such adverse determination; and (C) in any
such judicial proceeding or arbitration the Company shall have the
burden of proving that the Indemnitee is not entitled to
indemnification under this Article.
(ii) If a determination shall have been made or deemed to have
been made, pursuant to Section B-4(b) or (c), that the Indemnitee is
entitled to indemnification, the Company shall be obligated to pay the
amounts constituting such indemnification within five days after such
determination has been made or deemed to have been made and shall be
conclusively bound by such determination unless (A) the Indemnitee
misrepresented or failed to disclose a material fact in making the
request for indemnification or in the Supporting Documentation or (B)
such indemnification is prohibited by law. In the event that (C)
advancement of expenses is not timely made pursuant to Section B-4(a)
or (D) payment of indemnification is not made within five days after a
determination of entitlement to indemnification has been made or
deemed to have been made pursuant to Section B-4(b) or (c), the
Indemnitee shall be entitled to seek judicial enforcement of the
Company's obligation to pay to the Indemnitee such advancement of
expenses or indemnification. Notwithstanding the foregoing, the
Company may bring an action, in an appropriate court of the State of
Delaware or any other court of competent jurisdiction, contesting the
right of the Indemnitee to receive indemnification hereunder due to
the occurrence of an event described in subclause (A) or (B) of this
clause (ii) (a "Disqualifying Event"); provided, however, that in any
such action the Company shall have the burden of proving the
occurrence of such Disqualifying Event.
(iii) The Company shall be precluded from asserting in any
judicial proceeding or arbitration commenced pursuant to this Section
B-4(d) that the procedures and presumptions of
<PAGE>
this Article are not valid, binding and enforceable and shall
stipulate in any such court or before any such arbitrator that the
Company is bound by all the provisions of this Article.
(iv) In the event that the Indemnitee, pursuant to this Section
B-4(d), seeks a judicial adjudication of or an award in arbitration to
enforce his rights under, or to recover damages for breach of, this
Article, the Indemnitee shall be entitled to recover from the Company,
and shall be indemnified by the Company against, any expenses actually
and reasonably incurred by him if the Indemnitee prevails in such
judicial adjudication. If it shall be determined in such judicial
adjudication or arbitration that the Indemnitee is entitled to receive
part but not all of the indemnification or advancement of expenses
sought, the expenses incurred by the Indemnitee in connection with
such judicial adjudication or arbitration shall be prorated
accordingly.
(e) Definitions. For purposes of this Section B-4:
(i) "Disinterested Director" means a director of the Company
who is not or was not a party to the Proceeding in respect of which
indemnification is sought by the Indemnitee.
(ii) "Independent Counsel" means a law firm or a member of a
law firm that neither presently is, nor in the past five years has
been, retained to represent (A) the Company or the Indemnitee in
any matter material to either such party or (B) any other party to
the Proceeding giving rise to a claim for indemnification under
this Article. Notwithstanding the foregoing, the term "Independent
Counsel" shall not include any person who, under the applicable
standards of professional conduct then prevailing under the law of
the State of Delaware, would have a conflict of interest in
representing either the Company or the Indemnitee in an action to
determine the Indemnitee's rights under this Article.
(5) Severability. If any provisions of this Article shall be held to
be invalid, illegal or unenforceable for any reason whatsoever: (a) the
validity, legality and enforceability of the remaining provisions of this
Article (including, without limitation, all portions of any paragraph of
this Article containing any such provision held to be invalid, illegal or
unenforceable that are not themselves invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby; and (b) to the
fullest extent possible, the provisions of this Article (including, without
limitation, all portions of any paragraph of this Article containing any
such provision held to be invalid, illegal or unenforceable that are not
themselves invalid, illegal or unenforceable) shall be construed so as to
give effect to the intent manifested by the provision held invalid, illegal
or unenforceable.
TENTH: To the extent deemed necessary or appropriate by the Board
of Directors to enable the Company to engage in any business or activity
directly or indirectly conducted by it in compliance with the laws of the United
States of America as now in effect or as they may hereafter from time to time be
amended, the Company may adopt such Bylaws as may be necessary or advisable to
comply with the provisions and avoid the prohibitions of any such law.
ELEVENTH: Elections of directors need not be by written ballot unless
the Bylaws of the Company shall so provide.
TWELFTH: The Company reserves the right at any time and from time to
time to amend, alter, change or repeal any provision contained in this
Certificate of Incorporation in the manner now or hereafter prescribed by law,
and all rights, preferences and privileges of whatsoever nature conferred upon
stockholders, directors, or any other persons whomsoever by and pursuant to this
Certificate of Incorporation in its present form or as hereinafter amended are
granted subject to the right reserved in this Article Twelfth.
<PAGE>
The name and mailing address of the incorporator is Mr. John M.
Edwards, Jr., Alston & Bird, One Atlantic Center, 1201 West Peachtree Street,
N.W., Atlanta, Georgia 30309-3424.
/s/ John M. Edwards, Jr.
- - -------------------------------
John M. Edwards, Jr.
Incorporator
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
FOR
FRIEDMAN'S INC.
FRIEDMAN'S INC., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of Friedman's
Inc., resolutions were duly adopted setting forth a proposed amendment of the
Certificate of Incorporation of the said corporation, declaring said amendment
to be advisable and submitting the proposed amendment to the stockholders of the
corporation for their consideration and approval. The proposed amendment is as
follows:
RESOLVED, that the first paragraph of Article FOURTH of the
Certificate of Incorporation is hereby deleted in its entirety, and the
following new first paragraph of Article FOURTH is hereby substituted in its
place:
FOURTH: The total number of shares of all classes of stock
which the Company shall have authority to issue is 42,000,000,
consisting of 10,000,000 shares of Preferred Stock, par value
$.01 per share (hereinafter called the "Preferred Stock"),
25,000,000 shares of Class A Common Stock, par value $.01 per
share (hereinafter called the "Class A Stock") and 7,000,000
shares of Class B Common Stock, par value $.01 per share
(hereinafter called the "Class B Stock," and the Class A Stock
and Class B Stock being hereinafter collectively called the
"Common Stock").
SECOND: That thereafter pursuant to resolution of its Board of
Directors, the stockholders of said corporation, by unanimous written consent in
accordance with Section 228 of the General Corporation Law of the State of
Delaware, approved the proposed amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, Friedman's Inc. has caused this certificate to be
signed by Bradley J. Stinn, its President and Chief Executive Officer, and John
G. Call, its Secretary, this 8th day of October, 1993.
By: /s/Bradley J. Stinn
--------------------
Bradley J. Stinn
President and Chief Executive Officer
ATTEST:
By: /s/ John G. Call
-----------------
John G. Call
Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
FOR
FRIEDMAN'S INC.
FRIEDMAN'S INC., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of Friedman's
Inc., resolutions were duly adopted setting forth a proposed amendment of the
Certificate of Incorporation of the said corporation, declaring said amendment
to be advisable and submitting the proposed amendment to the Class B Common
Stockholders of the corporation for their consideration and approval. The
proposed amendment is as follows:
RESOLVED, that paragraphs B.1 and B.2 of Article NINTH of the
Certificate of Incorporation is hereby deleted in its entirety, and the
following new paragraphs B.1. and B.2. of Article NINTH are hereby substituted
in their place:
1. Right to Indemnification. The Company shall to the fullest
extent permitted by applicable law as then in effect indemnify
any person (the "Indemnitee") who was or is involved in any
manner (including, without limitation, as a party or witness) or
is threatened to be made so involved in any threatened, pending
or completed investigation, claim, action, suit or proceeding,
whether civil, criminal, administrative or investigative
(including, without limitation, any action, suit or proceeding by
or in the right of the Company to procure a judgment in its
favor) (a "Proceeding") by reason of the fact that he is or was a
director or officer of the Company, or is or was serving at the
request of the Company as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or
other enterprise (including, without limitation, any employee
benefit plan) against all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such Proceeding.
Such indemnification shall be a contract right and shall include
the right to receive payment in advance of any expenses incurred
by the Indemnitee in connection with such Proceeding, consistent
with the provisions of applicable law as then in effect.
2. Insurance, Contracts and Funding. The Company may purchase
and maintain insurance to protect itself and any Indemnitee
against any expenses, judgments, fines and amounts paid in
settlement as specified in Section B-1 of this Article or
incurred by any Indemnitee in connection with any Proceeding
referred to in Section B-1 of this Article, to the fullest extent
permitted by applicable law as then in effect. The Company may
enter into contracts with any director or officer of the Company
in furtherance of the provisions of this Article and may create a
trust fund, grant a security interest or use other
<PAGE>
means (including, without limitation, a letter of credit) to
ensure the payment of such amounts as may be necessary to effect
indemnification as provided in this Article.
SECOND: That thereafter pursuant to resolution of its Board of
Directors, the Class B Common Stockholders of said corporation entitled to vote
thereon approved the proposed amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, Friedman's Inc. has caused this certificate to be
signed by Bradley J. Stinn, its President and Chief Executive Officer, and John
G. Call, its Secretary, this 28th day of February, 1995.
By: /s/ Bradley J. Stinn
--------------------
Bradley J. Stinn
President and Chief Executive Officer
ATTEST:
By: /s/ John G. Call
----------------
John G. Call
Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
------------------------
OF
--
CERTIFICATE OF INCORPORATION
----------------------------
OF
--
FRIEDMAN'S INC.
---------------
Friedman's Inc. (the "Corporation"), a corporation organized and
existing under and by the virtue of the General Corporation Law of the State of
Delaware, DOES HEREBY CERTIFY:
ONE
---
The Board of Directors of the Corporation, at a meeting duly called
and held on November 14, 1996, unanimously adopted resolutions approving a
proposed amendment to Article Fourth, Section B(2) of the Certificate of
Incorporation of the Corporation and declaring that such amendment be submitted
to the holder of the Class B Common Stock of the Corporation for its approval.
Such resolutions approved the deletion of Article Fourth, Section B(2) of the
Certificate of Incorporation in its entirety and the substitution in lieu
thereof of the following:
(2) With regard to the election of directors, holders of Class A
Stock shall be entitled, voting separately as a class, to elect 25
percent of the directors (rounding the number of such directors to the
next highest whole number if such percentage is not equal to a whole
number of directors) and no less, to remove any director elected by
the holders of Class A Stock (and any successor to such director) and,
in the manner provided in the Bylaws of the Company, to replace any
director so removed. If at any time there shall not be any Class B
Stock outstanding, the provisions of this Certificate of Incorporation
which provide limited and separate voting rights for the holders of
the Class A Stock shall cease to be of any effect, and such holders
shall thereafter have general voting power in the election of
directors and in all other matters upon which stockholders of the
Company are entitled to vote pursuant to this Certificate of
Incorporation, the Bylaws of the Company or statute.
TWO
---
The foregoing amendment to delete the present Article Fourth, Section
B(2) of the Certificate of Incorporation and to substitute in lieu thereof a new
Article Fourth, Section B(2) was submitted to the holder of Class B Common Stock
of the Corporation at the Annual Meeting of Stockholders of the Corporation duly
called and held on February 27, 1997. Notice of the Annual Meeting of
Stockholders was duly waived by the holder of Class B Common Stock in accordance
with the General Corporation Law of the State of Delaware. The foregoing
amendment was duly adopted at the Annual Meeting of Stockholders held on
February 27, 1997 by the holders of a majority of the issued and outstanding
shares of Class B Common Stock of the Corporation in accordance with the General
Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, Friedman's Inc. has caused this Certificate of
Amendment to be executed and its corporate seal to be affixed, all by its duly
authorized officers, this 10th day of March, 1997.
FRIEDMAN'S INC.
By: /s/ Robert W. Spell, Jr.
------------------------
Name: Robert W. Spell, Jr.
--------------------
Title: Secretary
---------
<PAGE>
EXHIBIT 4(C)
------------
Friedman's Inc. Amended and Restated 1994 Stock Option Plan for Outside
Directors
<PAGE>
FRIEDMAN'S INC.
AMENDED AND RESTATED
--------------------
1994 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
--------------------------------------------
1. Purpose. The purpose of the Friedman's, Inc. 1994 Stock Option Plan
-------
for Outside Directors (the "Plan") is to advance the interests of Friedman's,
Inc. (the "Company") by encouraging ownership of the Company's $.01 par value
Class A common stock (the "Common Stock") by non-employee directors of the
Company, thereby giving such directors an increased incentive to devote their
efforts to the success of the Company.
2. Administration. Grants of options under this Plan are automatic.
--------------
This Plan is intended to be a formula plan and shall be interpreted accordingly.
The Board of Directors shall have the power to interpret the Plan and shall have
the other powers and authority set forth herein.
3. Eligibility. Except as provided otherwise in this paragraph 3,
-----------
options under the Plan shall be granted in accordance with paragraph 5 to each
member of the Company's Board of Directors who is not a current employee of the
Company ("Outside Director"), provided that shares of the Company's Common Stock
remain available for grant hereunder in accordance with paragraph 4. In the
event that a new Outside Director is appointed by the Board of Directors to fill
a directorship position, the new Outside Director shall not be eligible for an
option grant until elected as a director by the stockholders of the Company. A
person to whom an option is granted under the Plan shall be referred to
hereinafter as a "Grantee".
4. Shares Subject to Plan. The shares subject to the Plan shall be
----------------------
authorized but unissued or reacquired shares of the Company's Common Stock.
Subject to adjustment in accordance with the provisions of paragraph 6 of the
Plan, the maximum number of shares of Common Stock for which options may be
granted under the Plan shall be 50,000, and the initial adoption of the Plan by
the Board of Directors of the Company shall constitute a reservation of 50,000
authorized but unissued, or reacquired, shares of Common Stock for issuance only
upon
<PAGE>
the exercise of options granted under the Plan. In the event that any
outstanding option granted under the Plan for any reason expires or is
terminated prior to the end of the period during which options may be granted
under the Plan, the shares of Common Stock allocable to the unexercised portion
of such option may again be subject in whole or in part to any option granted
under the Plan.
5. Terms and Conditions of Options. Options granted pursuant to the Plan
-------------------------------
shall be evidenced by Stock Option Agreements in such form as shall comply with
and be subject to the following terms and conditions:
(a) Grant. Each Outside Director who is serving in such capacity as
-----
of the day following the 1994 annual meeting of the Company's stockholders
("Annual Meeting") shall be granted an option to purchase 5,000 shares of the
Company's Common Stock as of December 20, 1993, subject to adjustment as
provided in Section 6. As of the day following each subsequent Annual Meeting,
each Outside Director who is serving in such capacity as of such date shall be
granted an option to purchase 1,000 shares of Common Stock, subject to
adjustment pursuant to Section 6.
On the date that each subsequent Outside Director is initially
elected or appointed to the Board, such director will receive an option to
purchase 5,000 shares of Common Stock, subject to adjustment as provided in the
Plan.
If the shares of Common Stock are not available under this Plan
to grant to Outside Directors the full amount of a grant contemplated by the
immediately preceding paragraph, then each Outside Director shall receive an
option to purchase shares of Common Stock in an amount equal to the number of
shares of Common Stock then available under the Plan divided by the number of
Outside Directors as of the day following the applicable Annual Meeting.
Fractional shares shall be ignored and not granted.
If at an Annual Meeting (and during the term of this Plan) there
are not sufficient shares of Common Stock available under the Plan to grant each
Outside Director an option to purchase the full amount of shares of Common
Stock, the provisions of this paragraph shall apply. If during the term of this
Plan, additional shares of Common Stock become available for grant (e.g.,
because of the forfeiture or lapse of an option) each person who was an Outside
Director both during such Annual Meeting and on the date the additional shares
of Common
<PAGE>
Stock become available ("Continuing Outside Director") shall receive an
additional option to purchase shares of Common Stock. The number of available
shares shall be divided equally among the options granted to the Continuing
Outside Directors. However, the aggregate number of shares of Common Stock
subject to the Continuing Outside Director's new option and any prior option
granted to the Continuing Outside Director on the day following the applicable
Annual Meeting shall not exceed 1,000 shares of Common Stock (subject to
adjustment pursuant to paragraph 6). If Outside Directors have not received the
full amount of shares of Common Stock on the day following two or more Annual
Meetings, available options shall be granted beginning with the earliest Annual
Meeting.
(b) Option Price. The option price for each option granted under the
------------
Plan shall be the Fair Market Value (as defined below) of the shares of Common
Stock subject to the option on the date of grant of the option. For purposes of
the Plan, the "Fair Market Value" of the shares of Common Stock shall mean the
closing "asked" price of the shares in the over-the-counter market on the day on
which such value is to be determined or, if such "asked" price is not available,
the last sales price on such day or, if no shares were traded on such day, on
the next preceding day on which the shares were traded, as reported by the
National Association of Securities Dealers Automatic Quotation System (NASDAQ)
or other national quotation service. If the shares are listed on a national
securities exchange, "Fair Market Value" means the closing price of the shares
on such national securities exchange on the day on which such value is to be
determined or, if no shares were traded on such day, on the next preceding day
on which shares were traded, as reported by National Quotation Bureau, Inc. or
other national quotation service.
(c) Medium and Time of Payment. The option price shall be payable in
--------------------------
full upon the exercise of an option in cash, by check, in shares of Common Stock
already held by the Grantee or any combination thereof. In the event that all
or part of the option price is paid in shares of Common Stock, the value of such
shares shall be equal to the Fair Market Value of such shares on the date of
exercise of the option (determined as provided in paragraph 5(b) of the Plan),
and the Grantee shall deliver to the Company a certificate or certificates
representing such
<PAGE>
shares duly endorsed to the Company or accompanied by a duly-executed separate
instrument of transfer satisfactory to the Board of Directors.
(d) Term. Each option granted under the Plan shall, to the extent
----
not previously exercised, terminate and expire on the date five years after the
date of grant of the option, unless earlier terminated as provided hereinafter
in Section 5(g).
(e) Exercisability. Six months after the option is granted, the
--------------
option may be exercised from time to time, in whole or in part.
(f) Method of Exercise. All options granted under the Plan shall be
------------------
exercised by an irrevocable written notice directed to the Secretary of the
Company at the Company's principal place of business. Such written notice shall
specify the form of payment made by the Grantee or his successor as provided by
paragraph 5(c) of the Plan and shall be accompanied by payment in full of the
option price for the shares for which such option is being exercised. The
Company shall make delivery of certificates representing the shares for which an
option has been exercised within a reasonable period of time; provided, however,
that if any law, regulation or agreement requires the Company to take any action
with respect to the shares for which an option has been exercised before the
issuance thereof, then the date of delivery of such shares shall be extended for
the period necessary to take such action. Certificates representing shares for
which options are exercised under the Plan may bear such restrictive legends as
may be necessary or desirable in order to comply with applicable federal and
state securities laws. Nothing contained in the Plan shall be construed to
require the Company to register any shares of Common Stock underlying options
granted under this Plan.
(g) Effect of Termination of Directorship or Death.
-----------------------------------------------
(i) Termination of Directorship. Upon termination of the
---------------------------
directorship of any Grantee with the Company for any reason other than for cause
or death, the option held by the Grantee under the Plan shall terminate one year
following the date of the Grantee's termination or, if earlier, on the date of
expiration of the option as provided by paragraph 5(d) of the Plan. If the
Grantee exercises the option after termination of the Grantee's
<PAGE>
directorship, the Grantee may exercise the option only with respect to the
shares which were otherwise exercisable on the termination date of the Grantee's
directorship. Such exercise shall otherwise be subject to the terms and
conditions of the Plan. If the Outside Director's membership on the Board of
Directors is terminated for cause, all options granted to such Outside Director
shall expire upon such termination.
(ii) Death. In the event of the death of a Grantee, the
-----
Grantee's personal representatives, heirs or legatees (the "Grantee's
Successors") may exercise the option held by the Grantee on the date of his
death, to the extent then exercisable, upon proof satisfactory to the Company of
their authority. The Grantee's Successors must exercise any such option within
one year after the date of the Grantee's death and in any event prior to the
date on which the option expires as provided by paragraph 5(d) of the Plan. Such
exercise otherwise shall be subject to the terms and conditions of the Plan.
(h) Nonassignability of Option Rights. No option shall be assignable
---------------------------------
or transferable by the Grantee except by will, by the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined in
Title I of the Employee Retirement Income Security Act of 1974 and the Internal
Revenue Code of 1986. During the lifetime of the Grantee, the option shall be
exercisable only by the Grantee.
(i) Rights as Stockholder. Neither the Grantee nor the Grantee's
---------------------
Successors shall have rights as a stockholder of the Company with respect to
shares of Common Stock covered by the Grantee's option until the Grantee or the
Grantee's Successors become the holder of record of such shares.
(j) No Options in Certain Cases. No options shall be granted except
---------------------------
within a period of eight years after the effective date of the Plan.
<PAGE>
6. Adjustments.
-----------
(a) If any change is made in the stock subject to the Plan, or
subject to any option granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or otherwise), the Plan and outstanding
options will be automatically and appropriately adjusted, including the maximum
number of shares subject to the Plan and the number of shares and price per
share of stock subject to outstanding options.
(b) In the event of: (1) a dissolution or liquidation of the Company;
(2) a merger or consolidation in which the Company is not the surviving
corporation; (3) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding immediately
preceding the merger are converted by virtue of the merger into other property,
whether in the form of securities, cash other otherwise; or (4) any other
capital reorganization in which more than fifty percent (50%) of the shares of
the Company entitled to vote are exchanged, then any surviving corporation shall
assume any options outstanding under the Plan or shall substitute similar
options for those outstanding under the Plan. If there is no surviving
corporation, all outstanding options shall continue in full force and effect.
7. Effective Date and Termination of Plan.
--------------------------------------
(a) Effective Date. The Plan shall become effective as of the day
--------------
following the 1994 Annual Meeting, provided that the stockholders of the Company
shall approve the Plan during the 1994 Annual Meeting.
(b) Termination. The Plan shall terminate eight years after its
-----------
effective date, but the Board of Directors may terminate the Plan at any time
prior to such date. Termination of the Plan shall not alter or impair any of
the rights or obligations under any option theretofore granted under the Plan
unless the Grantee shall so consent.
<PAGE>
8. Application of Funds. The proceeds received by the Company from the
--------------------
sale of shares of Common Stock pursuant to options granted under the Plan may be
used for general corporate purposes.
9. No Obligation to Exercise Option. The granting of an option shall
--------------------------------
impose no obligation upon the Grantee to exercise such option.
10. Amendment. The Board of Directors of the Company by majority vote may
---------
amend the Plan; provided, however, that the Board may condition any amendment or
modification on the approval of stockholders of the Company if such approval is
necessary or deemed advisable with respect to tax, securities or other
applicable laws, policies or regulations.
Any amendment to the Plan shall not, without the written consent of the
Grantee, affect such Grantee's rights under any option theretofore granted to
such Grantee.
<PAGE>
EXHIBIT 5
---------
Opinion of Alston & Bird LLP regarding the legality of
the securities being registered
<PAGE>
[LETTERHEAD OF ALSTON & BIRD LLP APPEARS HERE]
March 21, 1997
Friedman's Inc.
4 West State Street
Savannah, Georgia 31401
Re: Form S-8 Registration Statement of Friedman's Inc. - Amended
and Restated 1994 Stock Option Plan for Outside Directors
Ladies and Gentlemen:
We have acted as counsel for Friedman's Inc., a Delaware corporation
(the "Company"), in connection with the referenced Registration Statement on
Form S-8 (the "Registration Statement") being filed by the Company with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended, and covering 25,000 shares of the Company's Class A Common
Stock, $0.01 par value ("Common Stock") that may be offered and sold to the Non-
Employee Directors of the Company pursuant to the Friedman's Inc. Amended and
Restated 1994 Stock Option Plan for Outside Directors (the "Plan"). This
Opinion Letter is rendered pursuant to Item 8 of Form S-8 and Item 601(b)(5) of
Regulation S-K.
This Opinion Letter is limited by, and is in accordance with, the
January 1, 1992 edition of the Interpretive Standards Applicable to Legal
Opinions to Third Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the Corporate and Banking Law Section of the State Bar of Georgia
(the "Interpretive Standards"), which Interpretative Standards are incorporated
in this Opinion Letter by this reference. Capitalized terms used in this
Opinion Letter and not otherwise defined herein shall have the meanings assigned
to such terms in the Interpretive Standards and in the Registration Statement.
In the capacity described above, we have considered such matters of
law and of fact, including the examination of originals or copies, certified or
otherwise identified to our satisfaction, of such records and documents of the
Company, certificates of public officials and such other documents as we have
deemed appropriate as a basis for the opinions hereinafter set forth.
Based upon the foregoing, we are of the opinion that the 25,000 shares
of Common Stock issuable under the Plan and covered by the Registration
Statement, when delivered to participants in accordance with the terms and
conditions of the Plan, will be legally and validly issued, fully paid and
nonassessable.
The Opinion expressed herein is limited to the laws of the State of
Delaware as codified in the General Corporation Law of the State of Delaware.
This Opinion Letter is provided to you for your benefit and for the benefit of
the Commission, in each case, solely with regard to the Registration Statement,
may be relied upon by you and the Commission only in connection with the
Registration Statement, and may not be relied upon by any other person or for
any other purpose without our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and further consent to the use of our name wherever
appearing in the Registration Statement.
Sincerely,
ALSTON & BIRD LLP
By: /s/ Alston & Bird LLP
-------------------------------------
<PAGE>
EXHIBIT 23(A)
-------------
Consent of Alston & Bird LLP
(Included in Exhibit 5)
<PAGE>
EXHIBIT 23(B)
-------------
Consent of Ernst & Young LLP
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Amended and Restated Registration Statement on Form S-8 for
registration of 25,000 shares of common stock pertaining to the Friedman's Inc.
Amended and Restated 1994 Stock Option Planfor Outside Directors of our report
date d November6, 1996 with respect to the financial statements and schedules of
Friedman's Inc.'s included in its Annual Report on Form 10-K for the year ended
September 30, 1996, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Ernst & Young LLP
Jacksonville, Florida
March 17, 1997
