Exhibit 4.2


     

     

     

      
        

      

    

    Exhibit
      4.2

     

    ARTICLES
      OF RESTATEMENT

    OF

    FRANKLIN
      COVEY CO.

     

    In
      accordance with Section 16-10a-1007 of the Utah Revised Business
      Corporation Act (the “Act”),
      Franklin Covey Co., a Utah corporation (the “Company”),
      hereby certifies as follows:

     

    1.  The
      name
      of the corporation is Franklin Covey Co.

     

    2.  The
      text
      of the Amended and Restated Articles of Incorporation (the “Restated
      Articles”),
      amending and restating the Company’s prior Amended and Restated Articles of
      Incorporation, is attached hereto as Exhibit
      A
      and is
      incorporated herein by this reference. The Restated Articles supersede the
      original Articles of Incorporation of the Company and all prior amendments
      and
      restatements thereto. 

     

    3.  The
      Restated Articles were adopted by the Company’s Board of Directors on November
      10, 2005 and the shareholders at the annual meeting of the shareholders held
      January 20, 2006 (the “Shareholders’
      Meeting”),
      in
      accordance with the requirements of the Act.

     

    4.  With
      respect to the approval of the Restated Articles, the number of outstanding
      shares of common stock, par value $0.05 per share (the “Common
      Stock”),
      including all outstanding shares of Series A Preferred Stock calculated on
      an
      as-converted into Common Stock basis, as of November 25, 2005, the record date
      for the Shareholders’ Meeting (the “Record
      Date”),
      was
      24,532,287 (collectively, the “Common
      Equivalent Shares”),
      the
      number of Common Equivalent Shares entitled to vote at the Shareholder’s Meeting
      as a voting group was 24,532,287 and the number of Common Equivalent Shares
      indisputably represented at the meeting was 20,332,329. The number of
      outstanding shares of Common Stock, excluding all outstanding shares of Series
      A
      Preferred Stock on an as-converted basis, as of the Record Date was 20,744,725,
      the number of such shares of Common Stock entitled to vote at the Shareholders’
Meeting as a voting group was 20,744,725 and the number of such shares
      indisputably represented at the meeting was 16,564,983. The number of
      outstanding shares of Series A Preferred Stock as of the Record Date was
      1,893,781, the number of such shares of Series A Preferred Stock entitled to
      vote at the Shareholders’ Meeting as a voting group was 1,893,781 and the number
      of shares or Series A Preferred Stock indisputably represented at the meeting
      was 1,883,673. Each share of Series A Preferred Stock is entitled to two votes
      of Common Stock. There were no outstanding shares of Series B Preferred Stock
      as
      of the Record Date and no shares of Series B Preferred Stock were entitled
      to
      vote at the Shareholders’ Meeting as a voting group.

     

    5.  For
      each
      voting group, the following numbers of votes were cast in favor of approving
      the
      Restated Articles: (i) 8,665,042 Common Equivalent Shares, (ii) 5,175,110 shares
      of Common Stock and (iii) 3,489,932 shares of Series A Preferred Stock. For
      each
      voting group, the number of votes cast in favor of the Restated Articles was
      sufficient for approval by such voting group. 

     

    IN
      WITNESS WHEREOF, these Articles of Restatement have been executed on behalf
      of
      the Company as of this 20th
      day of
      January, 2006.

     

    FRANKLIN
      COVEY CO.

    


    


    /s/
      ROBERT A. WHITMAN

    Robert
      A.
      Whitman

    Chief
      Executive Officer

     

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

     

    EXHIBIT
      A

    AMENDED
      AND RESTATED ARTICLES

     OF
      INCORPORATION 

    OF
      FRANKLIN COVEY CO.

    
    

     

     

    ARTICLE
      I  

     

    The
      name
      of the corporation is Franklin Covey Co. (the “Company”).

     

    ARTICLE
      II  

     

    The
      duration of the Company is perpetual.

     

    ARTICLE
      III  

     

    The
      purpose of the Company is to engage in any lawful act or activity for which
      corporations may be organized under the Utah Revised Business Corporation Act,
      as amended (the “Act”).

     

    ARTICLE
      IV  

     

    The
      Company is authorized to issue two classes of stock, which shall be designated,
      respectively, as common stock, par value $0.05 per share (“Common
      Stock”),
      and
      preferred stock, no par value (“Preferred
      Stock”).
      The
      total number of shares of capital stock that the Company shall have authority
      to
      issue is 54,000,000, consisting of 40,000,000 shares of Common Stock, and
      14,000,000 shares of Preferred Stock.

     

    The
      designation, powers, preferences and relative, participating, optional or other
      special rights, and qualifications, limitations or restrictions thereof, of
      each
      class of stock, and the express grant of authority to the Board of Directors
      to
      fix by resolution the designation, powers, preferences and relative,
      participating, optional or other special rights, and qualifications, limitations
      or restrictions thereof, of each share of Preferred Stock which are not fixed
      by
      these Amended and Restated Articles of Incorporation, are as
      follows:

     

    A.  Common
      Stock.

     

    1.  Dividends.

     

     Subject
      to the rights of the holders of Preferred Stock, and subject to any other
      provisions of the Articles of Incorporation, holders of Common Stock shall
      be
      entitled to receive such dividends and other distributions in cash, stock or
      property of the Company as may be declared thereon by the Board of Directors
      from time to time out of assets or funds of the Company legally available
      therefor.

     

    2.  Liquidation;
      Dissolution.

     

     In
      the event of any liquidation, dissolution or winding up of the affairs of the
      Company, whether voluntary or involuntary, after payment or provision for
      payment of the debts and other liabilities of the Company and after payment
      or
      provision for payment to the holders of each series of Preferred Stock of all
      amounts required in accordance with Section B.3 of this Article IV, the
      remaining assets and funds of the Company shall be divided among and paid to
      the
      holders of Common Stock.

     

    3.  Voting.

     

    (a)  At
      every
      meeting of the stockholders every holder of Common Stock shall be entitled
      to
      one vote in person or by proxy for each share of such Stock standing in his
      name
      on the stock transfer records of the Company.

     

    (b)  No
      shareholder shall have the right to cumulate votes in the election of
      directors.

     

    4.  Preemptive
      Rights.

     

     No
      holder of shares of Common Stock of the Company shall, as such holder, be
      entitled as of right to subscribe for, purchase or receive any part of any
      new
      or additional issue of stock of any class, whether now or hereafter authorized,
      or of bonds, debentures or other securities convertible into or exchangeable
      for
      stock, but all such additional shares of stock of any class, or bonds,
      debentures or other securities convertible into or exchangeable for stock,
      may
      be issued and disposed of by the Board of Directors on such terms and for such
      consideration, so far as may be permitted by law, and to such persons, as the
      Board of Directors in its absolute discretion may deem advisable.

     

    B.  Preferred
      Stock.

     

    1.  Number;
      Series.

     

     The
      Preferred Stock may be issued in one or more series, from time to time, with
      each such series to have such designation, powers, preferences and relative,
      participating, optional or other special rights and qualifications, limitations
      or restrictions thereof, as shall be stated and expressed in Section C of this
      Article IV or in the resolution or resolutions providing for the issue of such
      series adopted by the Board of Directors of the Company, subject to the
      limitations prescribed by law and in accordance with the provisions hereof,
      the
      Board of Directors being hereby expressly vested with authority to adopt any
      such resolution or resolutions. The authority of the Board of Directors with
      respect to each such series shall include, but not be limited to, the
      determination or fixing of the following:

     

    (a)  The
      distinctive designation and number of shares comprising such series, which
      number may (except where otherwise provided by the Board of Directors in
      creating such series) be increased or decreased (but not below the number of
      shares then outstanding) from time to time by like action of the Board of
      Directors;

     

    (b)  The
      dividend rate of such series, the conditions and times upon which such dividends
      shall be payable, the relation which such dividends shall bear to the dividends
      payable on any other class or classes of stock or series thereof, or on the
      other series of the same class, and whether dividends shall be cumulative or
      noncumulative;

     

    (c)  The
      conditions upon which the shares of such series shall be subject to redemption
      by the Company and the times, prices and other terms and provisions upon which
      the shares of the series may be redeemed;

     

    (d)  Whether
      or not the shares of the series shall be subject to the operation of retirement
      or sinking fund provisions to be applied to the purchase or redemption of such
      shares and, if such retirement or sinking fund be established, the annual amount
      thereof and the terms and provisions relative to the operation
      thereof;

     

    (e)  Whether
      or not the shares of the series shall be convertible into or exchangeable for
      shares of any other class or classes, with or without par value, or of any
      other
      series of the same class and, if provision is made for conversion or exchange,
      the times, prices, rates, adjustments, and other terms and conditions of such
      conversion or exchange;

     

    (f)  Whether
      or not the shares of the series shall have voting rights, in addition to the
      voting rights provided by law, and, if so, subject to the limitations
      hereinafter set forth, the terms of such voting rights;

     

    (g)  The
      rights of the shares of the series in the event of voluntary or involuntary
      liquidation, dissolution, or upon distribution of assets of the Company;
      and

     

    (h)  Any
      other
      powers, preferences and relative, participating, optional or other special
      rights, and qualifications, limitations or restrictions thereof, of the shares
      of such series, as the Board of Directors may deem advisable and as shall not
      be
      inconsistent with the provisions of these Articles of
      Incorporation.

     

    2.  Dividends.

     

     The
      holders of the shares of Preferred Stock of each series shall be entitled to
      receive, when and as declared by the Board of Directors, out of the funds
      legally available for the payment of dividends, dividends at the rate fixed
      by
      the Board of Directors for such series for the current period and, if
      cumulative, for all prior periods for which such dividends are cumulative,
      and
      no more, before any dividends, other than dividends payable in Common Stock,
      shall be declared and paid, or set apart for payment, on the Common Stock with
      respect to the same dividend period.

     

    Whenever,
      at any time, dividends on the then outstanding Preferred Stock as may be
      required with respect to any series outstanding shall have been paid or declared
      and set apart for payment on the then outstanding Preferred Stock, and after
      complying with respect to any retirement or sinking fund or funds for all
      applicable series of Preferred Stock, the Board of Directors may, subject to
      the
      provisions of Section C of this Article IV or the resolution or resolutions
      creating the series of Preferred Stock, declare and pay dividends on the Common
      stock as provided in Section A.1 of this Article IV, and the holders of shares
      of Preferred Stock shall not be entitled to share therein, except as otherwise
      provided in the resolution or resolutions creating any series.

     

    3.  Liquidation;
      Dissolution.

     

     The
      holders of the Preferred Stock of each series shall be entitled upon liquidation
      or dissolution of the Company to such preferences as are provided in Section
      C
      of this Article IV or the resolution or resolutions creating such series of
      Preferred Stock, and no more, before any distribution of the assets of the
      Company shall be made to the holders of shares of the Common Stock. Whenever
      the
      holders of shares of the Preferred Stock shall have been paid the full amounts
      to which they shall be entitled, the holders of shares of the Common Stock
      shall
      be entitled to share in all assets of the Company remaining as provided in
      Section A.2 of this Article IV. If, upon such liquidation, dissolution or
      winding up, the assets of the Company distributable as aforesaid among the
      holders of the Preferred Stock is insufficient to permit the payment to them
      of
      said preferential amounts, then such assets shall be distributed ratably among
      such holders in proportion to the respective total amounts which they shall
      be
      entitled to receive as provided in this Section B.3.

     

    4.  Voting.

     

     Except
      as otherwise provided by a resolution or resolutions of the Board of Directors
      creating any series of Preferred Stock or by the Act, the Common Stock issued
      and outstanding shall have and possess the exclusive power to vote for the
      election of directors and for all other purposes as provided in Section A.3
      of
      this Article IV.

     

    5.  Preemptive
      Rights.

     

     Except
      as may be provided in the resolution or resolutions of the Board of Directors
      providing for the issue of any series of Preferred Stock, no holder of shares
      of
      the Preferred Stock of the Company shall, as such holder, be entitled as of
      right to subscribe for, purchase or receive any part of any new or additional
      issue of stock of any class, whether now or hereafter authorized, or of bonds,
      debentures or other securities convertible into or exchangeable for stock,
      but
      all such additional shares of stock of any class, or bonds, debentures or other
      securities convertible into or exchangeable for stock, may be issued and
      disposed of by the Board of Directors on such terms and for such consideration,
      so far as may be permitted by laws, and to such persons, as the Board of
      Directors in its absolute discretion may deem advisable.

     

    C.  Series
      A and Series B Preferred Stock.

     

    1.  Certain
      Defined Terms, Etc.

     

    In
      addition to the terms defined elsewhere herein, certain terms used in this
      Article IV.C with initial capital letters have the meanings given to them
      in Section 11. References in this Article IV.C to Sections are, unless
      otherwise stated, references to Sections of this Article IV.C.

     

    2.  Designation.

     

    (a)  4,000,000 shares
      of
      Preferred Stock of the Company are designated as “Series A Preferred Stock”
having the powers, preferences and relative participating, optional and other
      special rights and the qualifications, limitations or restrictions thereof
      as
      set forth in this Article IV.C (the “Series A
      Preferred”).

     

    Effective
      as of the date these Restated Articles are duly filed with the Utah Department
      of Commerce, Division of Corporations and Commercial Code (the “Effective
      Date”),
      each
      share of Series A Preferred issued and outstanding immediately prior to the
      Effective Date (the “Old
      Series A Stock”)
      shall
      automatically and without any action on the part of the holder thereof be split,
      reclassified, changed and converted into four shares of Series A Preferred
      (the
“New
      Series A Stock”).
      The
      foregoing forward stock split shall be subject to the treatment of fractional
      share interests as described below.

     

    Each
      holder of a certificate or certificates, which immediately prior to the
      Effective Date represented outstanding shares of Old Series A Stock (the
“Old
      Series A Certificates”),
      shall
      be entitled to receive, as soon as reasonably practicable following the
      surrender of such Old Series A Certificates to the Company or the Company’s
      transfer agent for cancellation, a new certificate or certificates (the
“New
      Series A Certificates”)
      representing that number of whole shares of the New Series A Stock into which
      and for which the shares of the Old Series A Stock, formerly represented by
      such
      Old Series A Certificates so surrendered, are reclassified under the terms
      hereof. Each New Series A Certificate issued by the Company shall bear the
      legend required by Section 8(b)(iii).

     

    From
      and
      after the Effective Date, and until such certificates are surrendered, the
      Old
      Series A Certificates shall be deemed for all corporate purposes to evidence
      ownership of that number of whole shares of the New Series A Stock into which
      and for which the shares of the Old Series A Stock have been reclassified under
      the terms hereof. No certificates or scrip representing fractional share
      interests in New Series A Stock will be issued, and no such fractional share
      interest will entitle the holder thereof to vote, or to any rights of a
      stockholder of the Company.  A holder of Old Series A Certificates shall
      receive, as soon as reasonably practicable following the surrender of such
      certificates, in lieu of any fraction of a share of New Series A Stock to which
      the holder would otherwise be entitled, a cash payment therefor.  Such cash
      payment will equal the fraction to which the stockholder would otherwise be
      entitled multiplied by $25.00.  If more than one Old Series A Certificate
      shall be surrendered at one time for the account of the same stockholder, the
      number of full shares of New Series A Stock for which New Series A Certificates
      shall be issued shall be computed on the basis of the aggregate number of shares
      of New Series A Stock represented by the Old Series A Certificates so
      surrendered.  In the event that the Company or the Company’s transfer agent
      determines that a holder of Old Series A Certificates has not tendered all
      such
      certificates for exchange, the Company or the Company’s transfer agent shall
      carry forward any fractional share of New Series A Stock until all Old Series
      A
      Certificates held by such holder have been presented for exchange such that
      payment for fractional shares to any one person shall not exceed the value
      of
      one share of New Series A Stock held by such person.  All references
      elsewhere in these Restated Articles to the “Series A Preferred” shall, after
      the Effective Date, refer to the New Series A Stock. 

     

    (b)  4,000,000
      shares of Preferred Stock of the Company are designated as “Series B
      Preferred Stock” having the powers, preferences and relative participating,
      optional and other special rights and the qualifications, limitations or
      restrictions thereof as set forth in this Article IV.C (the “Series B
      Preferred”).
      The
      Series A Preferred and the Series B Preferred are together referred to herein
      as
      the “Senior
      Preferred.”

     

    3.  Dividends
      and Distributions.

     

     

    (a)  The
      holders of shares of Senior Preferred, if any, and in preference to the holders
      of Common Stock, and of any other class or series of Preferred Stock or other
      capital stock of the Company (together with the Common Stock, “Junior
      Stock”),
      will
      be entitled to receive dividends at an annual rate of $2.50 per share (as
      adjusted for any stock dividends, combinations or splits with respect to such
      shares) (such dividends, “Regular
      Dividends”),
      payable quarterly in arrears on the 15th day of each of March, June, September
      and December of each year or such other dates as are the 15th day of the month
      following the end of each of the Company’s fiscal quarters (except that if any
      such date is a Saturday, Sunday or legal holiday, then such dividend will be
      payable on the next day that is not a legal holiday) (the “Dividend
      Payment Date”),
      commencing, with respect to each share of Senior Preferred, on the first date
      on
      which such share of Senior Preferred is issued (the “Initial
      Issuance Date”)
      to
      such holders, prior and in preference to any declaration or payment of any
      dividend on any Junior Stock; provided
      that
      dividends on shares of Series B Preferred issued upon conversion of shares
      of
      Series A Preferred will commence on the Initial Issuance Date of the shares
      of
      Series A Preferred that are converted into such shares of Series B Preferred.
      Regular Dividends will be cumulative and accrue with respect to each outstanding
      share of Senior Preferred from the date dividends commence on such share (the
      “Dividend
      Commencement Date”),
      whether or not declared by the Board and whether or not there are funds of
      the
      Company legally available for payment of such dividends. No accrued or
      accumulated dividends on the Senior Preferred will bear interest.

     

    (b)  Each
      Regular Dividend will be payable to holders of record as they appear on the
      stock books of the Company on the last day of each fiscal quarter of the
      Company.

     

    4.  Voting
      Rights.

     

    (a)  In
      addition to the rights provided in Sections 4(b), 4(c) and 4(d), holders of
      record of Series A Preferred (the “Series
      A Holders”)
      will
      have the right to vote or consent in writing together with the Common Stock
      on
      all matters presented to the holders of Common Stock as set forth in Section
      4(e). Apart from the rights provided in Sections 4(b), 4(c) and 4(d),
      holders of record of Series B Preferred (the “Series
      B Holders”)
      will
      have no voting rights.

     

    (b)  In
      addition to the voting rights provided by Sections 4(a), 4(c) and 4(d), as
      long as any shares of Senior Preferred are outstanding, the affirmative vote
      or
      consent of the holders of a majority of the then-outstanding shares of Senior
      Preferred, voting as a separate voting group, will be required in order for
      the
      Company to:

     

    (i)  amend,
      alter or repeal, whether by merger, consolidation or otherwise, the terms of
      this Article IV.C or any other provision of the Restated Articles, in any
      way that adversely affects any of the powers, designations, preferences and
      relative, participating, optional and other special rights of the Senior
      Preferred, and the qualifications, limitations or restrictions
      thereof;

     

    (ii)  issue
      any
      shares of capital stock ranking prior or superior to, or on parity with, the
      Senior Preferred with respect to dividends or other distributions or upon
      liquidation, dissolution or winding up of the Company, or issue any Junior
      Stock
      other than Common Stock;

     

    (iii)  subdivide
      or otherwise change shares of Senior Preferred into a different number of shares
      whether in a merger, consolidation, combination, recapitalization,
      reorganization or otherwise; or

     

    (iv)  issue
      any
      shares of Senior Preferred other than in accordance with this
      Article IV.C.

     

    (c)  In
      addition to the voting rights provided by Sections 4(a), 4(b) and 4(d), the
      affirmative vote or consent of the holders of a majority of the then-outstanding
      shares of Senior Preferred, voting as a separate voting group, will be required
      for the Company to declare or pay any dividends or other distributions on or
      in
      respect of Junior Stock (a “Junior
      Stock Dividend”);
      provided,
      however,
      that
      such affirmative vote or consent of the holder of Senior Preferred shall not
      be
      required for any proposed Junior Stock Dividend if (i) the Company has paid
      all
      Regular Dividends for all fiscal quarters preceding the fiscal quarter in which
      the Company proposes to pay such Junior Stock Dividend and (ii) the Company
      has
      reserved sufficient funds to pay the Regular Dividend that will become payable
      for such fiscal quarter in which the Company proposes to pay a Junior Stock
      Dividend in accordance with Section 3.

     

    (d)  In
      addition to the voting rights provided by Sections 4(a), 4(b) and 4(c),
      whenever dividends of the Senior Preferred shall be in arrears in an amount
      equal to at least six quarterly dividends (whether or not consecutive), the
      number of members of the Board shall be increased by two and the holders of
      the
      Senior Preferred (voting as a voting group) will be entitled to vote for and
      elect such two additional directors of the Company at any meeting of
      shareholders of the Company at which directors are to be elected during the
      period such dividends remain in arrears. Whenever the right to elect directors
      shall have accrued to the holders of the Senior Preferred, the proper officers
      of the Company shall call a meeting for the election of such directors, such
      meeting to be held not less than 45 nor more than 90 days after the accrual
      of
      such right. The right of the holders of the Senior Preferred to vote for such
      two additional directors shall terminate when all accrued and unpaid dividends
      on the Senior Preferred have been paid or set apart for payment. The term of
      office of all directors so elected shall terminate immediately upon the
      termination of the right of the holders of the Senior Preferred to vote for
      such
      two additional directors. In connection with such right to vote, each holder
      of
      Senior Preferred will have one vote for each share of Senior Preferred
      held.

     

    (e)  On
      all
      matters presented before the holders of the Common Stock for their vote or
      consent, each share of Series A Preferred will be entitled to the number of
      votes equal to two shares of Common Stock (as adjusted for any stock dividends,
      combinations or splits with respect to shares of Common Stock); provided, however,
      the
      aggregate number of votes attributable to any Series A Holder’s shares of Series
      A Preferred shall be reduced by the sum of (x) the number of shares of Common
      Stock acquired by such Series A Holder upon the exercise of any warrant issued
      to such Series A Holder pursuant to the Preferred Stock Amendment and Warrant
      Issuance Agreement dated November 29, 2004 between the Company and the investor
      identified therein (each, a “Warrant”)
      and
      (y) the number of shares of Common Stock purchasable upon exercise of any
      Warrant that has been sold or transferred by such Series A Holder to any other
      person or entity.

     

    (f)  Notwithstanding
      any other provision of the Restated Articles or Bylaws of the Company, the
      holders of a majority of the then-outstanding Senior Preferred may consent
      in
      writing to any matter about which a class vote is contemplated by
      Section 4(b), 4(c) or 4(d), which written consent when so executed by the
      holders of a majority of the then-outstanding Senior Preferred will be deemed,
      subject to applicable Utah law, to satisfy the requirements of
      Section 4(b), 4(c) or 4(d), as applicable.

     

    5.  Reacquired
      Shares.

     

     Any
      shares of Senior Preferred that are issued and thereafter cease to be issued
      and
      outstanding for any reason, whether because shares of Series A Preferred are
      converted into shares of Series B Preferred pursuant to Section 8 or shares
      of
      Senior Preferred are purchased or otherwise acquired by the Company in any
      manner whatsoever, will reduce the number of authorized shares of either
      Series A Preferred or Series B Preferred, as applicable, will be restored
      to the status of authorized but unissued shares of Preferred Stock of the
      Company, and may be reissued as part of a new series of Preferred Stock of
      the
      Company subject to the conditions and restrictions on issuance set forth herein
      or in any other articles of amendment creating a series of Preferred Stock
      or
      any other stock of the Company.

     

    6.  Liquidation,
      Dissolution or Winding Up.

     

     Upon
      any liquidation, dissolution or winding up of the Company, no distribution
      will
      be made to the holders of shares of Junior Stock unless, prior thereto, the
      holders of shares of Senior Preferred shall have received in cash $25.00 per
      share (the “Liquidation Price”) plus accrued and unpaid dividends to the date of
      payment. Neither a consolidation or merger of the Company with another
      corporation or other legal entity, nor a sale or transfer of all or part of
      the
      Company’s assets for cash, securities or other property will be considered a
      liquidation, dissolution or winding up of the Company for purposes of this
      Section 6.

     

    7.  Redemption.

     

    (a)  Redemption
      Right.
      The
      shares of Senior Preferred will not be redeemable, except as otherwise agreed
      between the Company and any holder or holders of Senior Preferred and except
      that:

     

    (i)  during
      the period beginning on March 8, 2005 and ending on March 8, 2006 (the
“Initial
      Redemption Period”),
      the
      Company may, upon 15 business days prior notice to the holders of Senior
      Preferred, redeem all or any portion of the then-outstanding Senior Preferred
      at
      100% of the then-applicable Liquidation Price plus accrued and unpaid dividends
      to the date of payment; and

     

    (ii)  provided
      it has redeemed during the period from July 15, 2005 through the end of the
      Initial Redemption Period 400,000 shares of Senior Preferred Stock, the Company
      shall have the right during the period beginning on March 9, 2006 and ending
      on
      December 31, 2006 (the “Second
      Redemption Period”),
      upon
      15 business days prior notice to the holders of Senior Preferred, to redeem
      all
      or any portion of the then-outstanding Senior Preferred at 100% of the
      then-applicable Liquidation Price plus accrued and unpaid dividends to the
      date
      of payment; and

     

    (iii)  provided
      the Company has redeemed during the period beginning on July 15, 2005 through
      then end of the Second Redemption Period 800,000 shares of Senior Preferred
      Stock, the Company shall have the right during the period beginning on January
      1, 2007 and ending on December 31, 2007 (the “Third
      Redemption Period,”
each
      of
      the Initial Redemption Period, the Second Redemption Period and the Third
      Redemption Period being called a “Redemption
      Period”),
      upon
      15 business days prior notice to the holders of Senior Preferred, to redeem
      all
      or any portion of the then-outstanding Senior Preferred at 100% of the
      then-applicable Liquidation Price plus accrued and unpaid dividends to the
      date
      of payment; and

     

    (iv)  beginning
      on the fifth anniversary of the expiration of the last Redemption Period, during
      which the Company shall have the right to redeem Senior Preferred Stock based
      on
      the Company’s redemption of Senior Preferred pursuant to subparts (i) through
      (iii) of this Section 7(a), the Company may, upon 15 business days prior notice
      to the holders of Senior Preferred, redeem all or any portion of the
      then-outstanding Senior Preferred at 101% of the then-applicable Liquidation
      Price plus accrued and unpaid dividends to the date of payment.

     

    Any
      partial redemption effected pursuant to this Section 7 shall be made on a
      pro-rata basis among the holders of Senior Preferred in proportion to the shares
      of Senior Preferred then held by them. Notwithstanding anything to the contrary,
      the mandatory conversion of shares of Series A Preferred into shares of Series
      B
      Preferred pursuant to Section 8 hereof may occur at any time during the notice
      periods set forth in clauses (i) through (iv) of this Section 7(a).

     

    


    (b)  Redemption
      Notice.
      Any
      notice of redemption given pursuant to Section 7(a) (“Redemption
      Notice”)
      will
      be given in writing by the Company by first class mail, postage prepaid, to
      each
      holder of record of Senior Preferred on the record date fixed for such
      redemption by the Board at such holder’s address as it appears on the stock
      books of the Company, provided that no failure to give such notice nor any
      deficiency therein will affect the validity of the procedure for redemption
      of
      any shares of Senior Preferred except as to the holder or holders to whom the
      Company has failed to give such notice or whose notice was defective. The
      Redemption Notice will state:

     

    (i)  the
      redemption price;

     

    (ii)  the
      total
      number of shares of Senior Preferred being redeemed;

     

    (iii)  the
      date
      fixed for redemption by the Board, which date will occur within the applicable
      redemption period specified in Section 7(a) above (the “Redemption
      Date”);

     

    (iv)  the
      place
      or places and manner in which the holder is to surrender his or her
      certificate(s) to the Company; and

     

    (v)  that
      dividends on the shares of Senior Preferred to be redeemed will cease to
      accumulate on the Redemption Date unless the Company defaults on the redemption
      price.

     

    Upon
      surrender of the certificate(s) representing shares of Senior Preferred that
      are
      the subject of redemption pursuant to Section 7(a), duly endorsed (or
      otherwise in proper form for transfer, as determined by the Company), in the
      manner and at the place designated in the Redemption Notice and on the
      Redemption Date, the full redemption price for such shares will be paid in
      cash
      to the Person whose name appears on such certificate(s) as the owner thereof,
      and each surrendered certificate will be canceled and retired.

     

    (c)  Senior
      Dividends.
      On and
      after the Redemption Date or on or after the date of redemption otherwise agreed
      upon by and between the Company and any holder or holders of shares of Senior
      Preferred, unless the Company defaults in the payment in full of the applicable
      redemption price, dividends on the Senior Preferred to be redeemed will cease
      to
      accumulate, and all rights of the holders thereof will terminate with respect
      thereto on the Redemption Date (or such other redemption date, if applicable),
      other than the right to receive the applicable redemption price; provided,
      however,
      that if
      a Redemption Notice has been given as provided in Section 7(b) and the
      funds necessary for redemption (including an amount in cash in respect of all
      dividends that will accumulate to the Redemption Date) have been irrevocably
      deposited in trust with a bank having an aggregate shareholders’ equity of at
      least $5.0 billion for the equal and ratable benefit of all holders of shares
      of
      Senior Preferred that are to be redeemed, then, at the close of business on
      the
      day on which such funds are deposited in trust, dividends on the Senior
      Preferred to be redeemed will cease to accumulate and the holders thereof will
      cease to be shareholders of the Company and be entitled only to receive the
      redemption price.

     

    8.  Conversion.

     

    (a)  No
      Optional Conversion.
      Neither
      the Series A Preferred nor the Series B Preferred will be convertible into
      the
      Common Stock or any other class or series of the Company’s capital stock except
      as provided in Section 8(b).

     

    (b)  Mandatory
      Conversion.

     

    (i)  If
      any
      Series A Holder voluntarily or involuntarily transfers, sells, assigns, devises,
      distributes or bequeaths any of such Series A Holder’s interest in any shares of
      Series A Preferred (including, without limitation, the power to vote or provide
      a consent with respect to any shares of Series A Preferred by proxy or
      otherwise) (a “Transfer”)
      to any
      Person (the “Transferee”)
      other
      than a Permitted Transferee, then each share of Series A Preferred subject
      to
      such Transfer automatically, without any action on the part of the Company
      or
      such Series A Holder, will be deemed to be converted into one share of fully
      paid and non-assessable Series B Preferred immediately before such transfer
      is
      completed. In the event of such a transfer, the Company and the transfer agent
      for the Series A Preferred, if any (the “Transfer
      Agent”),
      shall
      not register the transfer of such shares of Series A Preferred except to the
      Company or a Permitted Transferee of such Series A Holder; provided,
      however,
      that
      such restrictions on transfer shall not apply to a Business Combination of
      the
      Company with or into another corporation or entity, if the Company is not the
      Surviving Person.

     

    (ii)  Notwithstanding
      anything to the contrary set forth herein, any Series A Holder may pledge such
      Series A Holder’s shares to a financial institution pursuant to a bona fide
      pledge of such shares as collateral security of indebtedness due to the pledgee;
      provided,
      however,
      that
      such shares shall remain subject to the provisions of this Section 8(b) and
      may
      not be voted by the pledgee and, upon any transfer of such shares to the
      pledgee, such shares shall convert into Series B shares in accordance with
      paragraph (i) above.

     

    (iii)  Each
      certificate representing shares of Series A Preferred shall be endorsed with
      a
      legend that states that immediately prior to any Transfer of such shares of
      Series A Preferred such shares automatically will be converted into shares
      of
      Series B Preferred in accordance with the Restated Articles, and no such
      transfer will be valid unless such transfer has been recorded in stock transfer
      records kept by the Company or the Transfer Agent.

     

    (iv)  To
      effect
      any Transfer of Series A Preferred (which shall be converted into shares of
      Series B Preferred immediately prior to such Transfer as set forth in this
      Section 8(b)), the Series A Holder proposing to transfer such converted shares
      of Series A Preferred must surrender the certificate(s) representing such shares
      at the office of the Company or the Transfer Agent for the Series A Preferred
      with instructions identifying the Transferee proposed to receive converted
      shares of Series B Preferred. Thereupon, there shall be issued and delivered
      to
      such Transferee at such office in the name of the Transferee a certificate
      or
      certificates for the number of shares of Series B Preferred into which the
      Series A Preferred were converted.

     

    (c)  Reservation
      of Stock Issuable Upon Conversion.
      The
      Company will at all times reserve and keep available out of its authorized
      but
      unissued shares of Series B Preferred solely for the purpose of effecting the
      conversion of the shares of the Series A Preferred such number of its
      shares of Series B Preferred as will from time to time be sufficient to effect
      the conversion of all then-outstanding shares of the Series A Preferred;
      and if at any time the number of authorized but unissued shares of Series B
      Preferred will not be sufficient to effect the conversion of all
      then-outstanding shares of the Series A Preferred, the Company will take
      such corporate action as may, in the opinion of its counsel, be necessary to
      increase its authorized but unissued shares of Series B Preferred to such number
      of shares as will be sufficient for such purpose.

     

    9.  Fractional
      Shares.

     

     Following
      the split of the Old Series A Stock into the New Series A Stock, the Senior
      Preferred may not be issued in fractions of a share.

     

    10.  Rank.

     

     The
      Series A Preferred and the Series B Preferred will have equal rank. The
      Senior Preferred will rank senior as to all capital stock of the Company,
      including all Junior Stock, in each case as to the payment of dividends or
      other
      distributions or upon liquidation, dissolution or winding up.

     

    11.  Certain
      Defined Terms.

     

     In
      addition to the terms defined elsewhere in this Article IV.C, the following
      terms will have the following meanings when used herein with initial capital
      letters:

     

    (a)  “Affiliate”
of
      any
      Person means any other Person that, directly or indirectly through one or more
      intermediaries, controls or is controlled by, or is under common control with,
      such Person; and, for purposes of this definition only, “control” (including the
      terms “controlling,” “controlled by,” and “under common control with”) means the
      possession, direct or indirect, of the power to direct or cause the direction
      of
      the management, policies or activities of a Person whether through the ownership
      of securities, by contract or agency or otherwise;

     

    (b)  “Business
      Combination”
means
      any merger, consolidation, combination, recapitalization, reorganization or
      other transaction (whether or not the Company is the Surviving
      Person);

     

    (c)  “Permitted
      Transferee”
means,
      with respect to any Series A Holder, any Person that is (i) an Affiliate of
      such
      Series A Holder, (ii) a stockholder, partner or member or other equity owner
      holding at least 5% of the outstanding equity of such Series A Holder
      (calculated on a fully diluted basis), or (iii) such Series A Holder’s immediate
      family member or a trust for the benefit of such Series A Holder;

     

    (d)  “Person”
means
      any individual, firm, corporation or other entity and included any successor
      (whether by merger or otherwise) of such entity; and

     

    (e)  “Surviving
      Person”
means
      the continuing, surviving or resulting Person in a Business Combination, the
      Person receiving a transfer of all or a substantial part of the properties
      and
      assets of the Company, or the Person consolidating with or merging into the
      Company in a Business Combination in which the Company is the continuing or
      surviving Person, but in connection with which the Senior Preferred is exchanged
      or converted into the securities of any other Person or the right to receive
      cash or any other property.

     

    ARTICLE
      V  

     

    To
      the
      fullest extent permitted by the Act or pursuant to any successor statute with
      similar effect, no director shall be liable to the Company or its shareholders
      for monetary damages. If the laws of the State of Utah are amended after the
      adoption of these Amended and Restated Articles of Incorporation to authorize
      corporate action further eliminating or limiting the personal liability of
      directors, then the liability of a director of the Company shall be eliminated
      or limited to the fullest extent permitted by the laws of the State of Utah,
      as
      so amended. The Company is authorized to indemnify directors and officers of
      the
      Company to the fullest extent permitted under applicable laws. Any repeal or
      modification of any applicable law or the foregoing provisions of this Article
      V
      shall not adversely affect any right of indemnification or limitation of
      liability of a director of the Company relating to acts or omissions occurring
      prior to such repeal or modification.