CERTIFICATE OF DESIGNATION ET AL.
Published on May 1, 1998
VAALCO ENERGY, INC.
CERTIFICATE OF DESIGNATION
OF CONVERTIBLE PREFERRED STOCK,
SERIES A SETTING FORTH THE POWERS,
PREFERENCES, RIGHTS, QUALIFICATIONS,
LIMITATIONS AND RESTRICTIONS OF
SUCH PREFERRED STOCK
Pursuant to Section 151 of the Delaware General Corporation Law,
VAALCO ENERGY, INC., a Delaware corporation (the "Corporation"), DOES HEREBY
CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors of the Corporation by the Certificate of Incorporation of the
Corporation (the "Charter"), the Board of Directors of the Corporation on
February 9, 1998 duly adopted the following resolution creating a series of
Preferred Stock designated as Convertible Preferred Stock, Series A and such
resolution has not been modified and is in full force and effect on the date
hereof:
RESOLVED that, pursuant to the authority vested in the Board of
Directors of the Corporation in accordance with the provisions of the Charter, a
series of authorized Preferred Stock, par value $25.00 per share, of the
Corporation are hereby created and that the designation and number of shares
thereof and the voting powers, preferences and relative, participating, optional
and other special rights of the shares of such series of Preferred Stock, and
the qualifications, limitations and restrictions thereof are as follows:
Section 1. DESIGNATION AND NUMBER.
(a) The shares of such series of Preferred Stock shall be
designated as "Convertible Preferred Stock, Series A" ("Preferred Stock"). The
number of shares initially constituting the Preferred Stock shall be 10,000,
which number may be decreased (but not increased) by the Board of Directors
without a vote of stockholders; PROVIDED, HOWEVER, that such number may not be
decreased below the number of then outstanding shares of such series of
Preferred Stock.
(b) The Preferred Stock shall, with respect to rights on
liquidation, dissolution or winding up, rank prior to all other classes and
series of Junior Stock of the Corporation now or hereafter authorized including,
without limitation, the Common Stock.
(c) Capitalized terms used herein and not otherwise defined shall
have the meanings set forth in Section 9 below.
Section 2. DIVIDENDS AND DISTRIBUTIONS. In the event that the Corporation shall
declare a cash dividend or make any other distribution (including, without
limitation, in capital stock (which shall include, without limitation, any
options, warrants or other rights to acquire capital stock) of the Corporation,
whether or not pursuant to a shareholder rights plan, "poison pill" or similar
arrangement, or other property or assets) to holders of Common Stock, then the
Board of Directors shall declare, and the holder of each share of Preferred
Stock shall be entitled to receive, a dividend or distribution in an amount
equal
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to the amount of such dividend or distribution received by a holder of the
number of shares of Common Stock for which such share of Preferred Stock is
convertible on the record date for such dividend or distribution. Any such
amount shall be paid to the holders of shares of Preferred Stock at the same
time such dividend or distribution is made to holders of Common Stock.
The holders of shares of Preferred Stock shall not be entitled to
receive any dividends or other distributions except as provided herein.
Section 3. VOTING RIGHTS.
In addition to any voting rights provided by law, the holders of
shares of Preferred Stock shall have the following voting rights:
(a) Except as otherwise required by applicable law and so long as
the Preferred Stock is outstanding, each share of Preferred Stock shall entitle
the holder thereof to vote, in person or by proxy or written consent, at a
special or annual meeting of stockholders or in connection with any stockholder
action taken in lieu of a meeting of stockholders, on all matters voted on by
holders of Common Stock, including the election of directors, voting together as
a single class with all other shares entitled to vote thereon. With respect to
any such vote, each share of Preferred Stock shall entitle the holder thereof to
cast that number of votes per share as is equal to the number of votes that such
holder would be entitled to cast had such holder converted his shares of
Preferred Stock into Common Stock on the record date for determining the
stockholders of the Corporation eligible to vote on any such matters.
(b) Unless the consent or approval of a greater number of shares
shall then be required by law, the affirmative vote of the holders of at least
66-2/3% of the outstanding shares of Preferred Stock, voting separately as a
single class, in person or by proxy, at a special or annual meeting of
stockholders called for the purpose, shall be necessary to (i) authorize, adopt
or approve an amendment to the Charter that would increase or decrease the par
value of the shares of Preferred Stock, or alter or change the powers,
preferences or special rights of the shares of Preferred Stock, (ii) amend,
alter or repeal the Charter so as to affect the shares of Preferred Stock
adversely, including, without limitation, by granting any voting right to any
holder of notes, bonds, debentures or other debt obligations of the Corporation,
or (iii) authorize, increase the authorized number of shares of, or issue
(including on conversion or exchange of any convertible or exchangeable
securities or by reclassification) any additional shares of Preferred Stock.
(c) The holders of shares of Preferred Stock shall have, in
addition to the other voting rights set forth herein, the exclusive right,
voting separately as a single class, to elect three directors of the
Corporation, by written consent as provided herein, or at a special meeting of
such holders called as provided herein, one of which director shall be elected
to each of the corporation's three classes if the Corporation has a classified
Board of Directors. Such directors shall continue as directors (subject to
reelection or removal as provided in Section 3(d)(ii)) and the holders of
Preferred Stock shall have such class voting rights until such time as the
number of outstanding shares of Preferred Stock represent (after giving effect
to any adjustments) on a fully-diluted basis less than 5% of the total number of
shares of Common Stock outstanding, at which time such additional director shall
cease to be a director and such additional voting rights of the holders of
Preferred Stock shall terminate subject to revesting in the event of each and
every subsequent event of the character indicated above.
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(d) (i) The foregoing right of holders of shares of Preferred
Stock to take any action as provided in Section 3(c) may be exercised at any
annual meeting of stockholders or at a special meeting of holders of shares of
Preferred Stock held for such purpose as hereinafter provided or at any
adjournment thereof, or by the written consent, delivered to the Secretary of
the Corporation, of the holders of the minimum number of shares required to take
such action.
So long as such right to vote continues (and unless such right
has been exercised by written consent of the minimum number of shares required
to take such action), the Chief Executive Officer or President of the
Corporation may call, and upon the written request of holders of record of at
least 5% of the outstanding shares of Preferred Stock, addressed to the
Secretary of the Corporation at the principal office of the Corporation, shall
call, a special meeting of the holders of shares entitled to vote as provided
herein. Such meeting shall be held within 30 days after delivery of such request
to the Secretary, at the place and upon the notice provided by law and in the
by-laws of the Corporation for the holding of meetings of stockholders.
(ii) At each meeting of stockholders at which the holders
of shares of Preferred Stock shall have the right, voting separately as a single
class, to elect three directors of the Corporation as provided in Section 3(c)
or to take any action, the presence in person or by proxy of the holders of
record of one-third of the total number of shares of Preferred Stock then
outstanding and entitled to vote on the matter shall be necessary and sufficient
to constitute a quorum. At any such meeting or at any adjournment thereof:
(A) the absence of a quorum of the holders of shares of
Preferred Stock shall not prevent the election of directors other
than those to be elected by the holders of shares of Preferred
Stock, and the absence of a quorum of the holders of shares of
any other class or series of capital stock shall not prevent the
election of directors to be elected by the holders of shares of
Preferred Stock, or the taking of any action as provided in this
Section 3: and
(B) in the absence of a quorum of the holders of shares of
Preferred Stock, a majority of the holders of such shares present
in person or by proxy shall have the power to adjourn the meeting
as to the actions to be taken by the holders of shares of
Preferred Stock from time to time and place to place without
notice other than announcement at the meeting until a quorum
shall be present.
For taking of any action as provided in Section 3(b) or Section
3(c) by the holders of shares of Preferred Stock, each such holder shall have
one vote for each share of such stock standing in his or her name on the
transfer books of the Corporation as of any record date fixed for such purpose
or, if no such date be fixed, at the close of business on the Business Day next
preceding the day on which notice is given, or if notice is waived, at the close
of business on the Business Day next preceding the day on which the meeting is
held; provided, however, that shares of Preferred Stock held by the Corporation
or any Affiliate of the Corporation shall not be deemed to be outstanding for
purposes of taking any action as provided in this Section 3.
Each director elected by the holders of shares of Preferred Stock
as provided in Section 3(c) shall, unless his or her term shall expire earlier
in accordance with the
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provisions thereof, hold office until the annual meeting of stockholders at
which directors of the class stand for election or until his or her successor,
if any, is elected and qualified.
If any director so elected by the holders of Preferred Stock
shall cease to serve as a director before his or her term shall expire (except
by reason of the termination of the voting rights accorded to the holders of
Preferred Stock in accordance with Section 3(c)), the holders of the Preferred
Stock then outstanding and entitled to vote for such director may, by written
consent as provided herein, or at a special meeting of such holders called as
provided herein, elect a successor to hold office for the unexpired term of the
director whose place shall be vacant.
Any director elected by the holders of shares of Preferred Stock
voting separately as a single class may be removed from office with or without
cause by the vote or written consent of the holders of at least a majority of
the outstanding shares of Preferred Stock, at the time of removal. A special
meeting of the holders of shares of Preferred Stock may be called in accordance
with the procedures set forth in Section 3(d)(i).
Section 4. REDEMPTION. The Corporation shall not have any right to redeem any
shares of Preferred Stock.
Section 5. REACQUIRED SHARES.
Any shares of Preferred Stock converted, exchanged, redeemed,
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares of Preferred Stock shall upon their cancellation become authorized but
unissued shares of preferred stock, par value $25.00 per share, of the
Corporation and, upon the filing of an appropriate Certificate of Designation
with the Secretary of State of the State of Delaware, may be reissued as part of
another series of preferred stock, par value $25.00 per share, of the
Corporation subject to the conditions or restrictions on issuance set forth
herein, but in any event may not be reissued as shares of Preferred Stock or
other Parity Stock unless all of the shares of Preferred Stock issued on the
Issue Date shall have already been redeemed, converted or exchanged.
Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP.
(a) If the Corporation shall commence a voluntary case under the
United States bankruptcy laws or any applicable bankruptcy, insolvency or
similar law of any other country, or consent to the entry of an order for relief
in an involuntary case under any such law or to the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or other similar
official) of the Corporation or of any substantial part of its property, or make
an assignment for the benefit of its creditors, or admit in writing its
inability to pay its debts generally as they become due (any such event, a
"Voluntary Liquidation Event"), or if a decree or order for relief in respect of
the Corporation shall be entered by a court having jurisdiction in the premises
in an involuntary case under the United States bankruptcy laws or any applicable
bankruptcy, insolvency or similar law of any other country, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or other
similar official) of the Corporation or of any substantial part of its property,
or ordering the winding up or liquidation of its affairs, and on account of any
such event the Corporation shall liquidate, dissolve or wind up, or if the
Corporation shall otherwise liquidate, dissolve or wind up, no distribution
shall be made (i) to the holders of
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shares of Junior Stock unless, prior thereto, the holders of shares of Preferred
Stock shall have received the Liquidation Preference.
(b) Neither the consolidation or merger of the Corporation with
or into any other Person nor the sale or other distribution to another Person of
all or substantially all the assets, property or business of the Corporation
shall be deemed to be a liquidation, dissolution or winding up of the
Corporation for purposes of this Section 6.
Section 7. CONVERSION.
(a) Any holder of Preferred Stock shall have the right, at its
option, at any time and from time to time, to convert, subject to the terms and
provisions of this Section 7, any or all of such holder's shares of Preferred
Stock into such number of fully paid and non-assessable shares of Common Stock
as is equal, subject to Section 7(g), to the product of the number of shares of
Preferred Stock being so converted multiplied by the quotient of (i) the
Purchase Price divided by (ii) the Conversion Price (as defined below) then in
effect. The Conversion Price shall be $1.00, subject to adjustment as set forth
in Section 7(d). Such conversion right shall be exercised by the surrender of
the shares to be converted to the Corporation at any time during usual business
hours at its principal place of business to be maintained by it, accompanied by
written notice that the holder elects to convert such shares and specifying the
name or names (with address) in which a certificate or certificates for shares
of Common Stock are to be issued and (if so required by the Corporation) by a
written instrument or instruments of transfer in form reasonably satisfactory to
the Corporation duly executed by the holder or its duly authorized legal
representative and transfer tax stamps or funds therefor, if required pursuant
to Section 7(j). All shares of Preferred Stock surrendered for conversion shall
be delivered to the Corporation for cancellation and cancelled by it and no
shares of Preferred Stock shall be issued in lieu thereof.
(b) As promptly as practicable after the surrender, as herein
provided, of any shares of Preferred Stock for conversion pursuant to Section
7(a), the Corporation shall deliver to or upon the written order of the holder
of such shares so surrendered a certificate or certificates representing the
number of fully paid and non-assessable shares of Common Stock into which such
shares of Preferred Stock may be or have been converted in accordance with the
provisions of this Section 7. Subject to the following provisions of this
paragraph and of Section 7(d), such conversion shall be deemed to have been made
immediately prior to the close of business on the date that such shares of
Preferred Stock shall have been surrendered in satisfactory form for conversion,
and the Person or Persons entitled to receive the Common Stock deliverable upon
conversion of such shares of Preferred Stock shall be treated for all purposes
as having become the record holder or holders of such Common Stock at such
appropriate time, and such conversion shall be at the Conversion Price in effect
at such time; PROVIDED, HOWEVER, that no surrender shall be effective to
constitute the Person or Persons entitled to receive the Common Stock
deliverable upon such conversion as the record holder or holders of such Common
Stock while the share transfer books of the Corporation shall be closed (but not
for any period in excess of five days), but such surrender shall be effective to
constitute the Person or Persons entitled to receive such Common Stock as the
record holder or holders thereof for all purposes immediately prior to the close
of business on the next succeeding day on which such share transfer books are
open, and such conversion shall be deemed to have been made at, and shall be
made at the Conversion Price in effect at, such time on such next succeeding
day.
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(c) To the extent permitted by law, when shares of Preferred
Stock are converted, all dividends declared and unpaid on the Preferred Stock so
converted to the date of conversion shall be immediately due and payable and
must accompany the shares of Common Stock issued upon such conversion.
(d) The Conversion Price shall be subject to adjustment as
follows:
(i) In case the Corporation shall at any time or from time to
time (A) pay a dividend or make a distribution (other than a dividend or
distribution paid or made to holders of shares of Preferred Stock in the
manner provided in Section 2) on the outstanding shares of Common Stock
in capital stock (which, for purposes of this Section 7(d) shall
include, without limitation, any dividends or distributions in the form
of options, warrants or other rights to acquire capital stock) of the
Corporation, (B) subdivide the outstanding shares of Common Stock into a
larger number of shares, (C) combine the outstanding shares of Common
Stock into a smaller number of shares, or (D) issue any shares of its
capital stock in a reclassification of the Common Stock then, and in
each such case, the Conversion Price in effect immediately prior to such
event shall be adjusted (and any other appropriate actions shall be
taken by the Corporation) so that the holder of any share of Preferred
Stock thereafter surrendered for conversion shall be entitled to receive
the number of shares of Common Stock or other securities of the
Corporation that such holder would have owned or would have been
entitled to receive upon or by reason of any of the events described
above, had such share of Preferred Stock been converted immediately
prior to the occurrence of such event. An adjustment made pursuant to
this Section 7(d)(i) shall become effective retroactively (A) in the
case of any such dividend or distribution, to a date immediately
following the close of business on the record date for the determination
of holders of Common Stock entitled to receive such dividend or
distribution or (B) in the case of any such subdivision, combination or
reclassification, to the close of business on the day upon which such
corporate action becomes effective.
(ii) In case the Corporation shall at any time or from time to
time issue shares of Common Stock (or securities convertible into or
exchangeable for Common Stock, or any options, warrants or other rights
to acquire shares of Common Stock) for a consideration per share less
than the Current Market Price per share of Common Stock then in effect
at the record date or issuance date, as the case may be (the "Date"),
referred to in the following sentence (treating the price per share of
any security convertible or exchangeable or exercisable into Common
Stock as equal to (A) the sum of the price for such security
convertible, exchangeable or exercisable into Common Stock plus any
additional consideration payable (without regard to any anti-dilution
adjustments) upon the conversion, exchange or exercise of such security
into Common Stock divided by (B) the number of shares of Common Stock
initially underlying such convertible, exchangeable or exercisable
security), then, and in each such case, the Conversion Price then in
effect shall be adjusted by dividing the Conversion Price in effect on
the day immediately prior to the Date by a fraction (x) the numerator of
which shall be the sum of the number of shares of Common Stock
outstanding on the Date plus the number of additional shares of Common
Stock issued or to
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be issued (or the maximum number into which such convertible or
exchangeable securities initially may convert or exchange or for which
such options, warrants or other rights initially may be exercised) and
(y) the denominator of which shall be the sum of the number of shares of
Common Stock outstanding on the Date plus the number of shares of Common
Stock which the aggregate consideration for the total number of such
additional shares of Common Stock so issued or would be issued upon the
conversion, exchange or exercise of such convertible or exchangeable
securities or options, warrants or other rights (plus the aggregate
amount of any additional consideration initially payable upon such
conversion, exchange or exercise of such security) would purchase at the
Current Market Price per share of Common Stock on the Date. Such
adjustment shall be made whenever such shares, securities, options,
warrants or other rights are issued, and shall become effective
retroactively to a date immediately following the close of business (i)
in the case of issuance to stockholders of the Corporation, as such, on
the record date for the determination of stockholders entitled to
receive such shares, securities, options, warrants or other rights and
(ii) in all other cases, on the date ("issuance date") of such issuance;
PROVIDED that: (A) the determination as to whether an adjustment is
required to be made pursuant to this Section 7(d)(ii) shall be made upon
the issuance of such shares or such convertible or exchangeable
securities, options, warrants or other rights; (B) if any convertible or
exchangeable securities, options, warrants or other rights (or any
portions thereof) which shall have given rise to an adjustment pursuant
to this Section 7(d)(ii) shall have expired or terminated without the
exercise thereof and/or if by reason of the terms of such convertible or
exchangeable securities, options, warrants or other rights there shall
have been an increase or increases, with the passage of time or
otherwise, in the price payable upon the exercise or conversion thereof,
then the Conversion Price hereunder shall be readjusted (but to no
greater extent than originally adjusted) on the basis of (x) eliminating
from the computation any additional shares of Common Stock corresponding
to such convertible or exchangeable securities, options, warrants or
other rights as shall have expired or terminated, (y) treating the
additional shares of Common Stock, if any, actually issued or issuable
pursuant to the previous exercise of such convertible or exchangeable
securities, options, warrants or other rights as having been issued for
the consideration actually received and receivable therefor and (z)
treating any of such convertible or exchangeable securities, options,
warrants or other rights which remain outstanding as being subject to
exercise or conversion on the basis of such exercise or conversion price
as shall be in effect at this time; and (C) no adjustment in the
Conversion Price shall be made pursuant to this Section 7(d)(ii) as a
result of any issuance of securities by the Corporation in respect of
which an adjustment to the Conversion Price is made pursuant to Section
7(d)(i).
(iii) In the case the Corporation, at any time or from time to
time, shall take any action affecting its Common Stock similar to or
having an effect similar to any of the actions described in any of
Section 7(d)(i) and Section 7(d)(ii), or Section 7(h) (but not including
any action described in any such Section) and the Board of Directors of
the Corporation in good faith determines that it would be equitable in
the circumstances to adjust the Conversion Price as a result of such
action, then, and in each such case, the
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Conversion Price shall be adjusted in such manner and at such time as
the Board of Directors of the Corporation in good faith determines would
be equitable in the circumstances (such determination to be evidenced in
a resolution, a certified copy of which shall be mailed to the holders
of the Preferred Stock).
(iv) Notwithstanding anything herein to the contrary, no
adjustment under this Section 7(d) need be made to the Conversion Price
unless such adjustment would require an increase or decrease of at least
1% of the Conversion Price then in effect. Any lesser adjustment shall
be carried forward and shall be made at the time of and together with
the next subsequent adjustment, which, together with any adjustment or
adjustments so carried forward, shall amount to an increase or decrease
of at least 1% of such Conversion Price. Any adjustment to the
Conversion Price carried forward and not theretofore made shall be made
immediately prior to the conversion of any shares of Preferred Stock
pursuant hereto.
(v) Notwithstanding anything herein to the contrary, no
adjustment under this Section 7(d) shall be made upon the grant of
options to employees or directors of the Corporation pursuant to benefit
plans approved by the Board of Directors of the Corporation or upon the
issuance of shares of Common Stock upon exercise of such options if the
exercise price thereof was not less than the Market Price of the Common
Stock on the date such options were granted.
(e) If the Corporation shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a dividend or other
distribution, and shall thereafter and before the distribution to stockholders
thereof legally abandon its plan to pay or deliver such dividend or
distribution, then thereafter no adjustment in the Conversion Price then in
effect shall be required by reason of the taking of such record.
(f) Upon any increase or decrease in the Conversion Price, then,
and in each such case, the Corporation promptly shall deliver to each registered
holder of Preferred Stock at least 10 Business Days prior to effecting any of
the foregoing transactions a certificate, signed by the President or a
Vice-President and by the Treasurer or an Assistant Treasurer or the Secretary
or an Assistant Secretary of the Corporation, setting forth in reasonable detail
the event requiring the adjustment and the method by which such adjustment was
calculated and specifying the increased or decreased Conversion Price then in
effect following such adjustment.
(g) No fractional shares or scrip representing fractional shares
shall be issued upon the conversion of any shares of Preferred Stock. If more
than one share of Preferred Stock shall be surrendered for conversion at one
time by the same holder, the number of full shares of Common Stock issuable upon
conversion thereof shall be computed on the basis of the aggregate Purchase
Price of the shares of Preferred Stock so surrendered. If the conversion of any
share or shares of Preferred Stock results in a fraction, an amount equal to
such fraction multiplied by the Current Market Price of the Common Stock on the
Business Day preceding the day of conversion shall be paid to such holder in
cash by the Corporation.
(h) In case of any capital reorganization or reclassification or
other change of outstanding shares of Common Stock (other than a change in par
value, or from par value to no par value, or from
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no par value to par value), or in case of any consolidation or merger of the
Corporation with or into another Person (other than a consolidation or merger in
which the Corporation is the resulting or surviving Person and which does not
result in any reclassification or change of outstanding Common Stock), or in
case of any sale or other disposition to another Person of all or substantially
all of the assets of the Corporation (any of the foregoing, a "Transaction"),
the Corporation, or such successor or purchasing Person, as the case may be,
shall execute and deliver to each holder of Preferred Stock at least 10 Business
Days prior to effecting any of the foregoing Transactions a certificate that the
holder of each share of Preferred Stock then outstanding shall have the right
thereafter to convert such share of Preferred Stock into the kind and amount of
shares of stock or other securities (of the Corporation or another issuer) or
property or cash receivable upon such Transaction by a holder of the number of
shares of Common Stock into which such share of Preferred Stock could have been
converted immediately prior to such Transaction. Such certificate shall provide
for adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Section 7. If, in the case of any such
Transaction, the stock, other securities, cash or property receivable thereupon
by a holder of Common Stock includes shares of stock or other securities of a
Person other than the successor or purchasing Person and other than the
Corporation, which controls or is controlled by the successor or purchasing
Person or which, in connection with such Transaction, issues stock, securities,
other property or cash to holders of Common Stock, then such certificate also
shall be executed by such Person, and such Person shall, in such certificate,
specifically acknowledge the obligations of such successor or purchasing Person
and acknowledge its obligations to issue such stock, securities, other property
or cash to the holders of Preferred Stock upon conversion of the shares of
Preferred Stock as provided above. The provisions of this Section 7(h) and any
equivalent thereof in any such certificate similarly shall apply to successive
Transactions.
(i) The Corporation shall at all times reserve and keep available
for issuance upon the conversion of the Preferred Stock, such number of its
authorized but unissued shares of Common Stock as will from time to time be
sufficient to permit the conversion of all outstanding shares of Preferred
Stock, and shall take all action required to increase the authorized number of
shares of Common Stock if at any time there shall be insufficient authorized but
unissued shares of Common Stock to permit such reservation or to permit the
conversion of all outstanding shares of Preferred Stock.
(j) The issuance or delivery of certificates for Common Stock
upon the conversion of shares of Preferred Stock shall be made without charge to
the converting holder of shares of Preferred Stock for such certificates or for
any tax in respect of the issuance or delivery of such certificates or the
securities represented thereby, and such certificates shall be issued or
delivered in the respective names of, or (subject to compliance with the
applicable provisions of federal and state securities laws) in such names as may
be directed by, the holders of the shares of Preferred Stock converted;
PROVIDED, HOWEVER, that the Corporation shall not be required to pay any tax
which may be payable in respect of any transfer involved in the issuance and
delivery of any such certificate in a name other than that of the holder of the
shares of Preferred Stock converted, and the Corporation shall not be required
to issue or deliver such certificate unless or until the Person or Persons
requesting the issuance or delivery thereof shall have paid to the Corporation
the amount of such tax or shall have established to the reasonable satisfaction
of the Corporation that such tax has been paid.
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Section 8. CERTAIN REMEDIES.
Any registered holder of Preferred Stock shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Certificate of Designation and to enforce specifically the terms and provisions
of this Certificate of Designation in any court of the United States or any
state thereof having jurisdiction, this being in addition to any other remedy to
which such holder may be entitled at law or in equity.
Section 9. DEFINITIONS.
For the purposes of this Certificate of Designation of Preferred
Stock, the following terms shall have the meanings indicated:
"Affiliate" shall have the meaning ascribed to such term in Rule
12b-2 of the General Rules and Regulations under the Exchange Act; PROVIDED that
"Affiliate" shall not include the Purchaser or any Affiliate of the Purchaser.
"Business Day" shall mean any day other than a Saturday, Sunday
or other day on which commercial banks in the City of New York are authorized or
required by law or executive order to close.
"Common Stock" shall mean and include the Common Stock, par value
$0.10 per share, of the Corporation and each other class of capital stock of the
Corporation that does not have a preference over any other class of capital
stock of the Corporation as to dividends or upon liquidation, dissolution or
winding up of the Corporation and, in each case, shall include any other class
of capital stock of the Corporation into which such stock is reclassified or
reconstituted.
"Current Market Price" per share shall mean, on any date
specified herein for the determination thereof, (a) the average daily Market
Price of the Common Stock for those days during the period of 20 days, ending on
such date, which are Trading Days, and (b) if the Common Stock is not then
listed or admitted to trading on any national securities exchange or quoted in
the over-the-counter market, the Market Price on such date.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Securities and Exchange Commission
thereunder.
"Issue Date" shall mean the first date on which shares of
Preferred Stock are issued.
"Junior Stock" shall mean any capital stock of the Corporation
ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Preferred Stock including, without limitation, the Common
Stock.
"Liquidation Preference" with respect to a share of Preferred
Stock shall mean $10.00.
"Market Price" shall mean, per share of Common Stock on any date
specified herein: (a) the closing price per share of the Common Stock on such
date published in the Wall Street Journal or, if no such closing price on such
date is published in the Wall Street Journal, the average of the closing bid and
asked prices on such date, as
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officially reported on the principal national securities exchange on which the
Common Stock is then listed or admitted to trading; or (b) if the Common Stock
is not then listed or admitted to trading on any national securities exchange
but is designated as a national market system security by the NASD, the last
trading price of the Common Stock on such date; or (c) if there shall have been
no trading on such date or if the Common Stock is not so designated, the average
of the reported closing bid and asked prices of the Common Stock on such date as
shown by NASDAQ and reported by any member firm of the New York Stock Exchange,
Inc. selected by the Corporation. If none of (a), (b) or (c) is applicable,
Market Price shall mean a market price per share determined at the Corporation's
expense by an appraiser chosen by the holders of a majority of the shares of
Preferred Stock or, if no such appraiser is so chosen more than twenty business
days after notice of the necessity of such calculation shall have been delivered
by the Corporation to the holders of Preferred Stock, then by an appraiser
chosen by the Corporation.
"NASD" shall mean the National Association of Securities Dealers
Inc.
"NASDAQ" shall mean the National Market System of the National
Association of Securities Dealers, Inc. Automated Quotations System.
"Parity Stock" shall mean any capital stock of the corporation
ranking on a parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Preferred Stock.
"Person" shall mean any individual, firm, corporation,
partnership, trust, incorporated or unincorporated association, limited
liability company, joint venture, joint stock company, government (or an agency
or political subdivision thereof) or other entity of any kind, and shall include
any successor (by merger) of such entity.
"Purchase Price" means $2,750 per share of Preferred Stock.
"Purchaser" shall mean The 1818 Fund II, L.P., a Delaware limited
partnership.
"Senior Stock" shall mean any capital stock of the Corporation
ranking senior (either as to dividends or upon liquidation, dissolution or
winding up) to the Preferred Stock.
"Subsidiary" shall mean, with respect to any Person, a
corporation or other entity of which 50% or more of the voting power of the
voting equity securities or equity interest is owned, directly or indirectly, by
such Person.
"Trading Day" shall mean a day on which the national securities
exchanges are open for trading.
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IN WITNESS WHEREOF, VAALCO ENERGY, INC. has caused this
Certificate to be duly executed in its corporate name on this ____ day
of __________, 1998.
VAALCO ENERGY, INC.
By
Name:
Title:
ATTEST:
By
Name:
Title:
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