-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, lv5Yfo5uLR8E/tyD6FoeqODHt7pFcPN9AbP2Llfsl2HdQ2yUgHYNOowANF6/zmPi 6Fevr+DsREggZYtK6JIPXA== 0000889812-95-000233.txt : 19950530 0000889812-95-000233.hdr.sgml : 19950530 ACCESSION NUMBER: 0000889812-95-000233 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19950519 EFFECTIVENESS DATE: 19950607 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCLAIM ENTERTAINMENT INC CENTRAL INDEX KEY: 0000804888 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 382698904 STATE OF INCORPORATION: DE FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 033-59483 FILM NUMBER: 95541283 BUSINESS ADDRESS: STREET 1: 71 AUDREY AVE CITY: OYSTER BAY STATE: NY ZIP: 11771 BUSINESS PHONE: 5169222400 MAIL ADDRESS: STREET 1: 71 AUDREY AVE CITY: OYSTER BAY STATE: NY ZIP: 11771 FORMER COMPANY: FORMER CONFORMED NAME: GAMMA CAPITAL CORP DATE OF NAME CHANGE: 19880608 S-8 1 REGISTRATION STATEMENT As filed with the Securities and Exchange Commission on May 19, 1995 Registration No. 33-_______ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------ FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------ ACCLAIM ENTERTAINMENT, INC. (Exact name of registrant as specified in its charter) Delaware 38-2698904 (State or other jurisdiction of (I.R.S Employer incorporation or organization) Identification Number) One Acclaim Plaza Glen Cove, New York 11542 (Address of principal executive offices) ------------------ Acclaim Entertainment, Inc. 1988 Stock Option Plan (Full title of the plan) ------------------ Gregory E. Fischbach Copy to: Chief Executive Officer Eric M. Lerner, Esq. One Acclaim Plaza Rosenman & Colin Glen Cove, New York 11542 575 Madison Avenue (516) 656-5000 New York, New York 10022 (Name, address and telephone (212) 940-7157 number of agent for service) ------------------
CALCULATION OF REGISTRATION FEE - -------------------------------------------------------------------------------------- Title of Proposed maximum Proposed maximum Amount of securities to Amount to be offering price aggregate offering registration be registered registered per share* price* fee - -------------------------------------------------------------------------------------- Common Stock, par value $0.02 per share....... 6,000,000 $16.75 $100,500,000 $34,656 - --------------------------------------------------------------------------------------
* Estimated solely for the purpose of calculating the registration fee; computed, pursuant to Rule 457(c), upon the basis of the average of the high and low prices of the Common Stock as quoted on The NASDAQ Stock Market's National Market System on May 18, 1995. ------------------ PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE Acclaim Entertainment, Inc. (the "Company") is subject to the informational requirements of the Securities Exchange Act of 1934 (the "Exchange Act") and, in accordance therewith, files reports and other information with the Securities and Exchange Commission (the "Commission"). The following documents, or portions thereof, filed by the Company with the Commission pursuant to the Exchange Act are incorporated by reference in this Registration Statement: (a) Annual Report on Form 10-K for the fiscal year ended August 31, 1994, filed on November 28, 1994 (File No. 0- 16986); (b) Quarterly Report on Form 10-Q for the fiscal quarter ended November 30, 1994, filed on January 13, 1995 (File No. 0-16986); (c) Quarterly Report on Form 10-Q for the fiscal quarter ended February 28, 1995, filed on April 10, 1995 (File No. 0-16986); (d) Current Report on Form 8-K, filed on March 31, 1995 (File No. 0-16986); and (e) The information in respect of the Company's common stock under the caption "Description of Registrant's Securities to be Registered" contained in the Registration Statement on Form 8-A filed on June 8, 1988, as amended by the Current Report on Form 8-K, dated August 24, 1989, relating to the one-for-two stock split effected by the Company (File No. 0-16986). All documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment hereto indicating that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part of this Registration Statement from the respective dates of filings of such documents. ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS The Certificate of Incorporation of the Company provides that any person may be indemnified against all expenses and liabilities to the fullest extent permitted by the General Corporation Law of the State of Delaware. Section 145 of the General Corporation Law of Delaware, the law of the state in which the Company is incorporated, empowers a corporation within certain limitations to indemnify any person against expenses, including attorneys' fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with any suit or proceeding to which he is a party by reason of the fact that he is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, as long as he acted in good faith and in a manner which he reasonably believed to be in, or not opposed to, the best interests of the corporation. With respect to any criminal proceeding, he must have had no reasonable cause to believe his conduct was unlawful. The Company has in effect directors' and officers' liability insurance. ITEM 8. EXHIBITS Exhibit No. Description ----------- ----------- *4(a) - Acclaim Entertainment, Inc. 1988 Stock Option Plan, as amended and restated. 4(b) - Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company's Registration Statement on Form S-1, Registration No. 33-28274, filed on April 21, 1989, as amended). 4(c) - Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.2 to the Company's Registration Statement on Form S-1, Registration No. 33-28274, filed on April 21, 1989, as amended). *4(d) - Amendment to Certificate of Incorporation. *4(e) - Amended and Restated By-Laws of the Company. 4(f) - Specimen of common stock certificate of the Company (incorporated by reference to Exhibit 4.1 to the Company's Annual Report on Form 10-K for the year ended August 31, 1991, filed on November 8, 1989, as amended (File No. 0-16986)). *5 - Opinion of Rosenman & Colin. 23(a) - Consent of Grant Thornton LLP (included on page II-7). II-2 23(b) - Consent of Rosenman & Colin (included in Exhibit 5). 24 - Power of Attorney (included on page II-6) - --------------------------- * Filed herewith II-3 ITEM 9. UNDERTAKINGS The undersigned Registrant hereby undertakes: (a) to file, during any period in which offers or sales are being made, a post- effective amendment to this Registration Statement to include any material information with respect to the plan of distribution of the securities being registered hereby not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; (b) that, for the purpose of determining any liability under the Securities Act of 1933 (the "Securities Act"), each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and (c) 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. The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, 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 Securities Act and will be governed by the final adjudication of such issue. II-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant 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 Glen Cove, State of New York, on this 17th day of May, 1995. ACCLAIM ENTERTAINMENT, INC. (Registrant) By Gregory E. Fischbach ---------------------------- Gregory E. Fischbach Co-Chairman of the Board and Chief Executive Officer II-5 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Gregory E. Fischbach and James Scoroposki, and each or either of them, his true and lawful attorney-in-fact and agent, each acting alone, with full power of substitution and resubstitution, for him and in his name, place, and stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this Registration Statement, and to file the same, with all the exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, each acting alone, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises as fully, to all intents and purposes, as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, each acting alone, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated. Signature Title Date --------- ----- ---- Gregory E. Fischbach Co-Chairman; Chief Executive May 17, 1995 - ------------------------ Officer; Director Gregory E. Fischbach James Scoroposki Co-Chairman; Senior Executive May 17, 1995 - ------------------------ Vice President; Treasurer; James Scoroposki Secretary; Director Robert Holmes President; Chief Operating May 17, 1995 - ------------------------ Officer; General Manager; Robert Holmes Director Bernard J. Fischbach Director May 17, 1995 - ------------------------ Bernard J. Fischbach Michael Tannen Director May 17, 1995 - ------------------------ Michael Tannen Robert H. Groman Director May 17, 1995 - ------------------------ Robert H. Groman James Scibelli Director May 17, 1995 - ------------------------ James Scibelli Bruce Ravenel Director May 17, 1995 - ------------------------ Bruce Ravenel Anthony R. Williams Executive Vice President; May 17, 1995 - ------------------------ Chief Financial and Anthony R. Williams Accounting Officer II-6 CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS To the Board of Directors of Acclaim Entertainment, Inc. We have issued our report dated October 20, 1994 accompanying the consolidated financial statements and schedules of Acclaim Entertainment, Inc. and subsidiaries included in the Annual Report on Form 10-K for the year ended August 31, 1994, which is incorporated by reference in this Registration Statement on Form S-8. We consent to the incorporation by reference in the Registration Statement of the aforementioned report. GRANT THORNTON LLP New York, New York May 18, 1995 II-7 EXHIBIT INDEX Document Page Number - -------- ----------- 4(a) - Acclaim Entertainment, Inc. 1988 Stock Option Plan, as amended and restated. 4(b) - Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company's Registration Statement on Form S-1, Registration No. 33-28274, filed on April 21, 1989, as amended). 4(c) - Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.2 to the Company's Registration Statement on Form S-1, Registration No. 33-28274, filed on April 21, 1989, as amended). 4(d) - Amendment to Certificate of Incorporation. 4(e) - Amended and Restated By-Laws of the Company. 4(f) - Specimen of common stock certificate of the Company (incorporated by reference to Exhibit 4.1 to the Company's Annual Report on Form 10-K for the year ended August 31, 1991, filed on November 8, 1989, as amended (File No. 0-16986)). 5 - Opinion of Rosenman & Colin. 23(a) - Consent of Grant Thornton LLP (included on page II-7). 23(b) - Consent of Rosenman & Colin (included in Exhibit 5). 24 - Power of Attorney (included on page II-6) EX-4.(A) 2 AMENDED AND RESTATED 1988 STOCK OPTION PLAN ACCLAIM ENTERTAINMENT, INC. 1988 STOCK OPTION PLAN (Amended and Restated as of January 31, 1995) 1. Purpose. The purposes of this 1988 Stock Option Plan (the "Plan") are to induce certain individuals to remain in the employ of, or to continue to serve as directors of or as independent consultants to, Acclaim Entertainment, Inc. (the "Company") and its present and future subsidiary corporations (each a "Subsidiary"), as defined in section 424(f) of the Internal Revenue Code of 1986, as amended (the "Code"), to attract new individuals to enter into such employment and service and to encourage such individuals to secure or increase on reasonable terms their stock ownership in the Company. The Board of Directors of the Company (the "Board") believes that the granting of stock options (the "Options") under the Plan will promote continuity of management and increased incentive and personal interest in the welfare of the Company and aid in securing its continued growth and financial success. Options will be either (a) "incentive stock options" (which term, when used herein, shall have the meaning ascribed thereto by the provisions of section 422(b) of the Code) or (b) options which are not incentive stock options ("non-incentive stock options"), as determined at the time of the grant thereof by the Committee (the "Committee") referred to in Section 3(A) hereof. 2. Shares Subject to Plan. Options may be granted to purchase up to 15,000,000 shares of the common stock, par value $0.02 per share (the "Common Stock") of the Company. For purposes of this Section 2, the number of shares purchased upon the exercise of an Option shall be determined without giving effect to the use by a Participant of the right set forth in Section 8(C) hereof to deliver shares of the Common Stock in payment of all or a portion of the option price or the use by a Participant of the right set forth in Section 12(C) hereof to cause the Company to withhold from the shares of the Common Stock otherwise deliverable to him upon the exercise of an Option shares of the Common Stock in payment of all or a portion of his withholding obligation arising from such exercise. If any Options expire or terminate for any reason without having been exercised in full, new Options may thereafter be granted to purchase the unpurchased shares subject to such expired or terminated Options. 3. Administration. (A) The Plan shall be administered by a Committee which shall consist of two or more members of the Board, both or all of whom shall be "disinterested persons" within the meaning of Rule 16b-3(c)(2)(i) promulgated under Section 16(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and both or all of whom shall be "outside directors" within the contemplation of section 162(m)(4)(C)(i) of the Code. The Chief Executive Officer of the Company shall also be a member of the Committee, ex-officio. The Committee shall be appointed annually by the Board, which may at any time and from time to time remove any members of the Committee, with or without cause, appoint additional members to the Committee and fill vacancies, however caused, in the Committee. A majority of the members of the Committee shall constitute a quorum. All determinations of the Committee shall be made by a majority of its members present at a meeting duly called and held except that the Committee may delegate to any one of its members the authority of the Committee with respect to the grant of Options to a person who shall not be an officer and/or director of the Company and who is not, and may not reasonably be expected to become, a "covered employee" within the meaning of section 162(m)(3) of the Code. Any decision or determination of the Committee reduced to writing and signed by all of the members of the Committee (or by a member of the Committee to whom authority has been delegated) shall be fully as effective as if it had been made at a meeting duly called and held. (B) Subject to the express provisions of the Plan, the Committee shall have complete authority, in its discretion, to interpret the Plan, to prescribe, amend and rescind rules and regulations relating to it, to determine the terms and provisions of the respective option agreements or certificates (which need not be identical), to determine the individuals (each a "Participant") to whom and the times and the prices at which Options shall be granted, the periods during which each Option shall be exercisable, the number of shares of the Common Stock to be subject to each Option and whether such Option shall be an incentive stock option or a non-incentive stock option and to make all other determinations necessary or advisable for the administration of the Plan; provided, however, that Outside Directors (as such term is defined in Section 4 hereof) who are members of the Committee shall only be granted Options in accordance with the provisions of Section 4(B) hereof. In making such determinations, the Committee may take into account the nature of the services rendered by the respective employees, their present and potential contributions to the success of the Company and the Subsidiaries and such other factors as the Committee in its discretion shall deem relevant. The Committee's determination on the matters referred to in this Section 3(B) shall be conclusive. Any dispute or disagreement which may arise under or as a result of or with respect to any Option shall be determined by the Committee, in its sole discretion, and any interpretations by the Committee of the terms of any Option shall be final, binding and conclusive. 4. Eligibility. (A) An Option may be granted only to (1) employees of the Company or a Subsidiary, (2) directors of the Company or a 2 Subsidiary who are not employees of the Company or a Subsidiary ("Outside Directors"), (3) employees of a corporation which has been acquired by the Company or a Subsidiary, whether by way of exchange or purchase of stock, purchase of assets, merger or reverse merger, or otherwise, who hold options with respect to the stock of such corporation which the Company has agreed to assume and (4) independent consultants who render services to the Company or a Subsidiary. (B) On the first business day of each August, commencing in August 1992, each Outside Director shall be granted an Option to purchase 18,750 shares of the Common Stock; provided, however, that the number of shares subject to an Option granted to an Outside Director during the calendar year in which he becomes an Outside Director shall be equal to 18,750 multiplied by a fraction, the numerator of which shall be the number of regular meetings remaining during such calendar year after his election as a director and the denominator of which shall be four. 5. Option Prices. (A) Except as otherwise provided in Sections 5(C) and 17 hereof, the initial per share option price of any Option which is an incentive stock option shall not be less than the fair market value of a share of the Common Stock on the date of grant; provided, however, that, in the case of a Participant who owns (within the meaning of section 424(d) of the Code) more than 10% of the total combined voting power of the Common Stock at the time an Option which is an incentive stock option is granted to him, the initial per share option price shall not be less than 110% of the fair market value of a share of the Common Stock on the date of grant. (B) Except as otherwise provided in Sections 5(C) and 17 hereof, the initial per share option price of any Option which is a non-incentive stock option shall not be less than 85% of the fair market value of a share of the Common Stock on the date of grant. (C) The initial per share option price of any Option which is granted to an Outside Director shall be equal to the fair market value of a share of the Common Stock on the date of grant. (D) For all purposes of this Plan, the fair market value of a share of the Common Stock on any date, if the Common Stock is then listed on a national securities exchange or traded on the NASDAQ National Market System, shall be equal to the closing sale price of a share of the Common Stock or, if there is no sale of the Common Stock on such date, the average of the bid and asked prices on such exchange or system at the close of trading on such date or, if the shares of the Common Stock are not then listed on a national securities exchange or such system on such date, the fair market value of a share of the Common Stock on such date as 3 shall be determined in good faith by the Committee. 6. Option Term. Options shall be granted for such term as the Committee shall determine, not in excess of ten years from the date of the granting thereof; provided, however, that, except as otherwise provided in Section 17 hereof, in the case of a Participant who owns (within the meaning of section 424(d) of the Code) more than 10% of the total combined voting power of the Common Stock at the time an Option which is an incentive stock option is granted to him, the term with respect to such Option shall not be in excess of five years from the date of the granting thereof; and provided, further, however, that the term of an Option granted to an Outside Director shall be ten years from the date of the granting thereof. 7. Limitation on Amount of Incentive Stock Options Granted. (A) Except as otherwise provided in Section 17 hereof, the aggregate fair market value of the shares of the Common Stock for which any Participant may be granted incentive stock options which are exercisable for the first time in any calendar year (whether under the terms of the Plan or any other stock option plan of the Company) shall not exceed $100,000. (B) No Participant shall be granted Options during any calendar year to purchase more than 300,000 shares of Common Stock, except that in calendar year 1994, no Participant shall be granted Options to purchase more than 450,000 shares of Common Stock. 8. Exercise of Options. (A) Except as otherwise provided in Section 17 hereof and, in the case of an Option granted to a person who shall not be an Outside Director, except as otherwise determined by the Committee at the time of the grant thereof, a Participant may (i) during the period commencing on the first anniversary of the date of the granting of an Option to him and ending on the day preceding the second anniversary of such date, exercise such Option with respect to one-third of the shares granted thereby, (ii) during the period commencing on such second anniversary and ending on the day preceding the third anniversary of the date of the granting of such Option, exercise such Option with respect to two-thirds of the shares granted thereby, and (iii) during the period commencing on such third anniversary, exercise such Option with respect to all of the shares granted thereby. (B) To the extent exercisable, an Option may be exercised either in whole at any time or in part from time to time. 4 (C) An Option may be exercised only by a written notice of intent to exercise such Option with respect to a specific number of shares of the Common Stock and payment to the Company of the amount of the option price for the number of shares of the Common Stock so specified; provided, however, that all or any portion of such payment may be made in kind by the delivery of shares of the Common Stock having a fair market value on the date of delivery equal to the portion of the option price so paid; provided, further, however, that, subject to the requirements of Regulation T promulgated under the Exchange Act, the Committee may implement procedures to allow a broker chosen by a Participant to make payment of all or any portion of the option price payable upon the exercise of an Option and receive, on behalf of such Participant, all or any portion of the shares of the Common Stock issuable upon such exercise. (D) Except in the case of an Option granted to an Outside Director, the Committee may, in its discretion, permit any Option to be exercised, in whole or in part, prior to the time when it would otherwise be exercisable. 9. Transferability. No Option shall be assignable or transferable except by will and/or by the laws of descent and distribution and, during the life of any Participant, each Option granted to him may be exercised only by him. 10. Termination of Service. (A) Except as otherwise determined by the Committee at the time of grant thereof, in the event a Participant leaves the employ or service of the Company and the Subsidiaries prior to his 65th birthday, whether voluntarily or otherwise but other than by reason of his death or "disability" (as such term is defined in section 22(e)(3) of the Code), each Option theretofore granted to him shall, to the extent not theretofore exercised, terminate forthwith. (B) In the event a Participant's employment or service with the Company and the Subsidiaries terminates by reason of his death, each Option theretofore granted to him shall become immediately exercisable in full and shall terminate upon the earlier to occur of (i) the expiration of the period of one year after the date of such Participant's death and (ii) the date specified in such Option. (C) In the event a Participant leaves the employ or service of the Company and the Subsidiaries on or after his 65th birthday or by reason of his disability, each Option theretofore granted to him shall become immediately exercisable in full and shall terminate upon the earlier to occur of (i) the expiration of the period of three months after the date of such retirement or 5 disability and (ii) the date specified in such Option. 11. Adjustment of Number of Shares. (A) In the event that a dividend shall be declared upon the Common Stock payable in shares of the Common Stock, the number of shares of the Common Stock then subject to any Option, the number of shares of the Common Stock which may be purchased upon the exercise of Options granted under the Plan but not yet covered by an Option and the number of shares of the Common Stock to be subject to an Option to be issued to an Outside Director shall be adjusted by adding to each share the number of shares which would be distributable thereon if such shares had been outstanding on the date fixed for determining the stockholders entitled to receive such stock dividend. In the event that the outstanding shares of the Common Stock shall be changed into or exchanged for a different number or kind of shares of stock or other securities of the Company or of another corporation, whether through reorganization, recapitalization, stock split-up, combination of shares, sale of assets, merger or consolidation in which the Company is the surviving corporation, then, there shall be substituted for each share of the Common Stock then subject to any Option, for each share of the Common Stock which may be purchased upon the exercise of Options granted under the Plan but not yet covered by an Option and for each share of the Common Stock to be subject to an Option to be issued to an Outside Director, the number and kind of shares of stock or other securities into which each outstanding share of the Common Stock shall be so changed or for which each such share shall be exchanged. (B) In the event that there shall be any change, other than as specified in Section 11(A) hereof, in the number or kind of outstanding shares of the Common Stock, or of any stock or other securities into which the Common Stock shall have been changed, or for which it shall have been exchanged, then, if the Committee shall, in its sole discretion, determine that such change equitably requires an adjustment in the number or kind of shares then subject to any Option and the number or kind of shares available for issuance in accordance with the provisions of the Plan but not yet covered by an Option, such adjustment shall be made by the Committee and shall be effective and binding for all purposes of the Plan and of each Option. (C) In the case of any substitution or adjustment in accordance with the provisions of this Section 11, the option price in each Option for each share covered thereby prior to such substitution or adjustment shall be the option price for all shares of stock or other securities which shall have been substituted for such share or to which such share shall have been adjusted in accordance with the provisions of this Section 11. 6 (D) No adjustment or substitution provided for in this Section 11 shall require the Company to sell a fractional share under any Option. (E) In the event of the dissolution or liquidation of the Company, or a merger, reorganization or consolidation in which the Company is not the surviving corporation, the Board, in its discretion, may accelerate the exercisability of each Option and/or terminate the same within a reasonable time thereafter. 12. Purchase for Investment, Withholding and Waivers. (A) Unless the delivery of the shares upon the exercise of an Option by a Participant shall be registered under the Securities Act of 1933, such Participant shall, as a condition of the Company's obligation to deliver such shares, be required to give a representation in writing that he is acquiring such shares for his own account as an investment and not with a view to, or for sale in connection with, the distribution of any thereof. (B) In the event of the death of a Participant, an additional condition of exercising any Option shall be the delivery to the Company of such tax waivers and other documents as the Committee shall determine. (C) An additional condition of exercising any non-incentive stock option shall be the entry by the Participant into such arrangements with the Company with respect to withholding as the Committee shall determine; provided, however, that such Participant may direct the Company to satisfy all or a portion of such withholding obligation by withholding from the shares of the Common Stock issuable to him on such exercise shares of the Common Stock having a fair market value equal to the portion of the withholding obligation so satisfied. 13. Declining Market Price. Except in the case of an Option granted to an Outside Director, in the event the fair market value of the Common Stock declines below the option price set forth in any Option, the Committee may, subject to the approval of the Board, at any time, adjust, reduce, cancel and re-grant any unexercised Option or take any similar action it deems to be for the benefit of the Participant in light of the declining fair market value of the Common Stock. 14. No Stockholder Status; No Restrictions on Corporate Acts; No Employment Right. (A) Neither any Participant nor his legal representatives, legatees or distributees shall be or be deemed to be the holder of any share of the Common Stock covered by an Option unless and until a certificate for such share has been issued. Upon payment 7 of the purchase price therefor, a share issued upon exercise of an Option shall be fully paid and non-assessable. (B) Neither the existence of the Plan nor any Option shall in any way affect the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company's capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Common Stock or the rights thereof, or dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding whether of a similar character or otherwise. (C) Neither the existence of the Plan nor the grant of any Option shall require the Company or any Subsidiary to continue any Participant in the employ or service of the Company or such Subsidiary. 15. Termination and Amendment of the Plan. (A) The Board may at any time terminate the Plan or make such modifications of the Plan as it shall deem advisable; provided, however, that the Board may not, without further approval of the holders of the shares of the Common Stock, increase the number of shares of the Common Stock as to which Options may be granted under the Plan (as adjusted in accordance with the provisions of Section 11 hereof), or change the class of persons eligible to participate in the Plan, or change the manner of determining the option prices, or extend the period during which an Option may be granted or exercised. Except as otherwise provided in Section 16 hereof, no termination or amendment of the Plan may, without the consent of the Participant to whom any Option shall theretofore have been granted, adversely affect the rights of such Participant under such Option. (B) The provisions of Section 4(B) hereof may not be amended except by the vote of the majority of the members of the Board and by the vote of the majority of the members of the Board who are not Outside Directors, and the provisions of said Section 4(B) shall not be amended more than once every six months, other than to comport with changes in the Code, the Employee Retirement Income Security Act of 1974 or the Rules and Regulations thereunder. 16. Expiration and Termination of the Plan. The Plan shall terminate on May 1, 1998 or at such earlier time as the Board may determine. Options may be granted under the Plan at any time and from time to time prior to its termination. Any Option outstanding under the Plan at the time of the termination of the Plan shall remain in effect until such 8 Option shall have been exercised or shall have expired in accordance with its terms. 17. Options Granted in Connection With Acquisitions. In the event that the Committee determines that, in connection with the acquisition by the Company or a Subsidiary of another corporation which will become a Subsidiary or division of the Company (such corporation being hereafter referred to as an "Acquired Subsidiary"), Options may be granted hereunder to employees and other personnel of an Acquired Subsidiary in exchange for then outstanding options to purchase securities of the Acquired Subsidiary. Such Options may be granted at such option prices, may be exercisable immediately or at any time or times either in whole or in part, and may contain such other provisions not inconsistent with the Plan, or the requirements set forth in Section 15 hereof that certain amendments to the Plan be approved by the stockholders of the Company, as the Committee, in its discretion, shall deem appropriate at the time of the granting of such Options. EX-4.(D) 3 CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION OF ACCLAIM ENTERTAINMENT, INC. ------------------------------------ Under Section 242 of the General Corporation Law ------------------------------------ The undersigned officer of Acclaim Entertainment, Inc., a Delaware corporation (the "Corporation"), in order to amend the Certificate of Incorporation of the Corporation, pursuant to the provisions of Section 242 of the General Corporation Law of the State of Delaware, does hereby certify as follows: 1. Part A of Article FOURTH of the Certificate of Incorporation of the Corporation is hereby amended and restated to read as follows: "FOURTH: A. The Corporation shall be authorized to issue (i) one hundred million (100,000,000) shares of common stock, par value $0.02 per share, and (ii) one million (1,000,000) shares of preferred stock, par value $0.01 per share, of which 200,000 shares of preferred stock are designated Series A Preferred Stock and which shall have the powers, designations, preferences, rights, limitations and qualifications hereinafter set forth in part D of this Article FOURTH." 2. The foregoing amendment to the Certificate of Incorporation of the Corporation was duly adopted by unanimous written consent of the Board of Directors of the Corporation dated as of December 15, 1994, and by the affirmative vote of a majority of the outstanding stock entitled to vote thereon, at a special meeting of the stockholders of the Corporation held on January 31, 1995. IN WITNESS WHEREOF, the Corporation has caused this Amendment to be signed by Anthony R. Williams, its Executive Vice President on January 31, 1995. ACCLAIM ENTERTAINMENT, INC. By Anthony R. Williams ------------------------------- Name: Anthony R. Williams Title: Executive Vice President EX-4.(E) 4 BY-LAWS BY-LAWS of ACCLAIM ENTERTAINMENT, INC. (Amended and Restated as of February 2, 1995) ARTICLE I Stockholders Section 1. Annual Meeting. The annual meeting of the stockholders of the Corporation shall be held annually at such place within or without the State of Delaware, at such time and on such date as may from time to time be designated by the Board of Directors, for the election of directors and for the transaction of any other proper business. Section 2. Special Meetings. Special meetings of the stockholders of the Corporation may be called at any time and from time to time by the President or by a majority of the di- rectors then in office, and shall be called by the Secretary upon the written request of stockholders holding of record at least a majority in number of the issued and outstanding shares of the Corporation entitled to vote at such meeting. Special meetings shall be held at such place within or without the State of Delaware, at such time and on such date as shall be specified in the call thereof. Section 3. Notice of Meetings. Written notice of each meeting of the stockholders, stating the place, date and hour thereof and, in the case of a special meeting, the purpose or purposes for which it is called, shall be given, not less than ten nor more than sixty days before the date of such meeting (or at such other time as may be required by statute), to each stockholder entitled to vote at such meeting. If mailed, such notice is given when deposited in the United States mail, postage prepaid, directed to each stockholder at his or her address as it appears on the records of the Corporation. Section 4. Waiver of Notice. Whenever notice is required to be given of any annual or special meeting of the stockholders, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated in such notice, shall be deemed equivalent to notice. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice. Attendance of a person at a meeting of the stockholders shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Section 5. Adjournment. When any meeting of the stock- holders is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place to which the meeting is adjourned are announced at the meeting at which the adjournment is taken. At the adjourned meeting any business may be transacted which might have been transacted at the original meeting. If the adjournment is for more than 30 days, or if after such adjournment the Board of Directors shall fix a new record date for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at such meeting. Section 6. Quorum. At any meeting of the stockholders the presence, in person or by proxy, of the holders of a majority of the issued and outstanding shares of the Corporation entitled to vote at such meeting shall be necessary in order to constitute a quorum for the transaction of any business. If there shall not be a quorum at any meeting of the stockholders, the holders of a majority of the shares entitled to vote present at such meeting, in person or by proxy, may adjourn such meeting from time to time, without further notice to the stockholders other than an announcement at such meeting, until holders of the amount of shares required to constitute a quorum shall be present in person or by proxy. Section 7. Voting. Each stockholder shall be entitled to one vote for each share of capital stock held by such stock- holder. Voting need not be by ballot, except that all election of directors shall be by written ballot unless otherwise provided in the Certificate of Incorporation. Whenever any corporate action is to be taken by vote of the stockholders, it shall, except as otherwise required by law or by the Certificate of Incorporation, be authorized by a majority of the votes cast at a meeting of stockholders of the holders of shares entitled to vote thereon, except that all elections shall be decided by a plural- ity of the votes cast. Section 8. Action Without a Meeting. Any action required or permitted to be taken at any annual or special meeting of stockholders may be taken without a meeting thereof, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of out- standing stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of such corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. Section 9. Record Date. The Board of Directors may fix, in advance, a record date, which shall not be more than sixty nor less than ten days before the date of any meeting of stock- holders, nor more than sixty days prior to any other action, as the record date for the purpose of determining the stockholders entitled to notice of or to vote at any meeting of the stockhold- ers or any adjournment thereof, or to express consent to corpo- 2 rate action in writing without a meeting, or entitled to receive payment of any dividend or distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action. Section 10. Proxies. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for him or her by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. ARTICLE II Directors Section 1. Number; Qualifications. The Board of Directors shall consist of one or more members. The number of directors shall be fixed by the Board of Directors, but shall not be less than three or more than eight. Directors need not be stock- holders of the Corporation. Section 2. Term of Office. Each director shall hold office until his or her successor is elected and qualified or until his or her earlier death, resignation or removal. Section 3. Meetings. A meeting of the Board of Directors shall be held for the election of officers and for the trans- action of such other business as may come before such meeting as soon as practicable after the annual meeting of the stockholders. Other regular meetings of the Board of Directors may be held at such times as the Board of Directors of the Corporation may from time to time determine. Special meetings of the Board of Direc- tors may be called at any time by the President of the Corpora- tion or by a majority of the directors then in office. Meetings of the Board of Directors may be held within or without the State of Delaware. Section 4. Notice of Meetings; Waiver of Notice; Adjourn- ment. No notice need be given of the first meeting of the Board of Directors after the annual meeting of stockholders or of any other regular meeting of the Board of Directors. Notice of a special meeting of the Board of Directors, specifying the place, date and hour thereof, shall be delivered personally, mailed or telegraphed to each director at his or her address as such address appears on the books of the Corporation at least two business days (Saturdays, Sundays and legal holidays not being considered business days for the purpose of these By-Laws) before the date of such meeting. Whenever notice is required to be given under any provision of the Certificate of Incorporation or these By-Laws, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a 3 director at a special meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not law- fully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, the directors or any committee of directors need be specified in any written waiver of notice unless so required by the Certificate of Incorporation or these By-Laws. A majority of the directors present whether or not a quorum is present, may adjourn any meeting to another time and place. Notice need not be given of the adjourned meeting if the time and place to which the meeting is adjourned are announced at the meeting at which the adjournment is taken, and at the adjourned meeting any busi- ness may be transacted that might have been transacted at the original meeting. Section 5. Quorum; Voting. A majority of the total number of directors shall constitute a quorum for the transaction of business. The vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. Section 6. Participation by Telephone. Members of the Board of Directors or any committee thereof may participate in a meeting of the Board of Directors or such committee by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting by such means shall consti- tute presence in person at such meeting. Section 7. Action Without a Meeting. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceeding of the Board of Di- rectors or of such committee. Section 8. Committees. The Board of Directors may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the directors. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed by the officers on all papers which may require it, but no such committee shall have the power or authority in reference to (a) amending the Certificate of Incorporation (except that a com- mittee may, to the extent authorized in the resolution or resolutions providing for the issuance of shares of stock adopted by the Board of Directors, fix the designations and any of the 4 preferences or rights of such shares relating to dividends, redemption, dissolution, any distribution of the assets of the Corporation or the conversion into, or the exchange of such shares for, shares of any other class or classes or any other series of the same or any other class or classes of stock of the Corporation, or fix the number of shares of any series of stock or authorize the increase or decrease of the shares of any series); (b) adopting an agreement of merger or consolidation; (c) recommending to the stockholders the sale, lease or exchange of all or substantially all of the Corporation's property and assets; (d) recommending to the stockholders a dissolution of the Corporation or a revocation of a dissolution; or (e) amending these By-Laws and, unless the resolution expressly so provides, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock. The Board of Directors may designate one or more directors as alternate members of any such committee, who may replace any absent or disqualified member at any meeting of such committee. In the ab- sence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not constituting a quorum, may unanimous- ly appoint another director to act at the meeting in the place of such absent or disqualified member. Section 9. Removal; Resignation. Any director or the entire Board of Directors may be removed with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors. Any director may resign at any time, upon written notice to the Corporation. Section 10. Vacancies. Vacancies and newly created di- rectorships resulting from any increase in the authorized number of directors may be filled by a majority of directors then in of- fice, although less than a quorum, or by a sole remaining direc- tor. When one or more directors shall resign from the Board of Directors, effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office as provided above in the filling of other vacancies. A director elected to fill a vacancy shall hold office for the unexpired term of his or her predecessor and until his successor is elected and qualified. Section 11. Compensation. The Board of Directors may fix the compensation of directors. 5 ARTICLE III Officers Section 1. Election; Qualifications. At the first meeting of the Board of Directors and as soon as practicable after each annual meeting of stockholders, the Board of Directors shall elect or appoint a Chairman of the Board, a President, one or more Vice-Presidents, a Secretary and a Treasurer, and may elect or appoint at such time or from time to time such additional of- ficers as it deems advisable. No officer need be a director of the Corporation. The office of Chairman of the Board may be shared by two or more persons. Any number of offices may be held by the same person, except that there shall always be two persons who hold offices which entitle them to sign instruments and stock certificates. Section 2. Term of Office; Vacancies. Each officer shall hold office until the election and qualification of his or her successor or until his or her earlier death, resignation or removal. Any vacancy occurring in any office, whether because of death, resignation or removal, with or without cause, or other- wise, shall be filled by the Board of Directors. Section 3. Removal; Resignation. Any officer may be re- moved from office at any time with or without cause by the Board of Directors. Any officer may resign his or her office at any time upon written notice to the Corporation. Section 4. Powers and Duties of the Chairman of the Board. The Chairman of the Board shall be the chief executive officer of the Corporation and shall have the general charge and supervision of its business affairs. The Chairman of the Board shall from time to time make such reports concerning the Corporation as the Board of Directors of the Corporation may require. The Chairman of the Board shall preside at all meetings of the stockholders and the Board of Directors. The Chairman of the Board shall have such other powers and perform such other duties as may from time to time be assigned to him or her by the Board of Directors. Section 5. Powers and Duties of the President. The Presi- dent shall be the chief operating and administrative officer of the Corporation and shall have general charge of its operations and administration. The President shall be given such other titles and designations and shall have such other powers and perform such other duties as may from time to time be assigned to him or her by the Board of Directors. Section 6. Powers and Duties of the Vice-Presidents. Each of the Vice-Presidents shall be given such titles and desig- nations and shall have such powers and perform such duties as may from time to time be assigned to him or her by the Board of Directors. 6 Section 7. Powers and Duties of the Secretary. The Sec- retary shall record and keep the minutes of all meetings of the stockholders and of the Board of Directors in a book to be kept for that purpose. The Secretary shall attend to the giving and serving of all notices by the Corporation. The Secretary shall be the custodian of, and shall make or cause to be made the proper entries in, the minute book of the Corporation and such other books and records as the Board of Directors may direct. The Secretary shall be the custodian of the corporate seal of the Corporation and shall affix or cause to be affixed such seal to such contracts and other instruments as the Board of Directors may direct. The Secretary shall have such other powers and shall perform such other duties as may from time to time be assigned to him or her by the Board of Directors. Section 8. Powers and Duties of the Treasurer. The Treasurer shall be the custodian of all funds and securities of the Corporation. Whenever required by the Board of Directors, the Treasurer shall render a statement of the Corporation's cash and other accounts, and shall cause to be entered regularly in the proper books and records of the Corporation to be kept for such purpose full and accurate accounts of the Corporation's receipts and disbursements. The Treasurer shall at all reason- able times exhibit the Corporation's books and accounts to any director of the Corporation upon application at the principal office of the Corporation during business hours. The Treasurer shall have such other powers and shall perform such other duties as may from time to time be assigned to him or her by the Board of Directors. Section 9. Delegation. In the event of the absence of any officer of the Corporation or for any other reason that the Board of Directors may deem sufficient, the Board of Directors may at any time or from time to time delegate all or any part of the powers or duties of any officer to any other officer or officers or to any director or directors. ARTICLE IV Stock The shares of the Corporation shall be represented by certificates signed by the Chairman of the Board, the President or any Vice-President and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary. Any of or all the signatures on the certificate may be a facsimile. ARTICLE V Execution of Documents All contracts, agreements, instruments, bills payable, notes, checks, drafts, warrants or other obligations of the Corporation shall be made in the name of the Corporation and shall be signed by such officer or officers as the Board of 7 Directors may from time to time designate. ARTICLE VI Seal The seal of the Corporation shall contain the name of the Corporation, the words "Corporate Seal", the year of its or- ganization and the word "Delaware". ARTICLE VII Indemnification Section 1. Indemnification. The Corporation hereby agrees to hold harmless and indemnify any of its officers, directors, employees or agents from and against, and to reimburse such persons for, any and all judgments, fines, liabilities, amounts paid in settlement and expenses, including attorneys' fees, in- curred directly or indirectly as a result of or in connection with any threatened, pending or completed action, suit or pro- ceeding, whether civil, criminal, administrative or investiga- tive, whether or not such action, suit or proceeding is by or in the right of the Corporation to procure a judgment in its favor, including an action, suit or proceeding by or in the right of any other corporation of any type or kind, domestic or foreign, or any partnership, joint venture, trust, employee benefit plan or other enterprise for which such person served in any capacity at the request of the Corporation, to which such person is, was or at any time becomes a party, or is threatened to be made a party, or as a result of or in connection with any appeal therein, by reason of the fact that such person is, was or at any time be- comes a director, officer, employee or agent of the Corporation or is or was serving or at any time serves such other corpora- tion, partnership, joint venture, trust, employee benefit plan or other enterprise in any capacity, whether arising out of any breach of such person's fiduciary duty as a director, officer, employee or agent of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise under any state or federal law or otherwise; provided, however, that (i) indemnification shall be paid pursuant to this Article VII if and only if such person acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful; and (ii) no indemnification shall be payable pursuant to this Article VII if a court having jurisdiction in the matter shall determine that such indemnification is not lawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reason- ably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was 8 unlawful. No indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. Section 2. Continuation of Indemnity. All agreements and obligations of the Corporation contained herein shall continue during the period such person shall serve as a director, officer, employee or agent of the Corporation and shall continue there- after so long as such person shall be subject to any possible claim or threatened, pending or completed action, suit or pro- ceeding, whether civil, criminal, administrative or investiga- tive, by reason of the fact that such person was a director or officer of the Corporation or served at the request of the Corporation in any capacity for any other corporation, partner- ship, joint venture, trust, employee benefit plan or other enterprise. Section 3. Advancement and Repayment of Expenses. Expenses incurred by an officer, director, employee or agent in defending any threatened or pending action, suit or proceeding, whether civil, criminal, administrative or investigative, shall be paid by the Corporation in advance of the final disposition thereof, other than those expenses for which such director or officer is not entitled to indemnification pursuant to the proviso to, or the last sentence of, Section 1 of this Article VII. The Corpo- ration shall make such payments upon receipt of (i) a written re- quest made by such person for payment of such expenses, (ii) an undertaking by or on behalf of such person to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Corporation as authorized herein and (iii) evidence satisfactory to the Corporation as to the amount of such expenses. Section 4. Authorization. Any indemnification under this Article VII (unless ordered by a court) shall be made by the Cor- poration only as authorized in the specific case upon a determin- ation that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the ap- plicable standard of conduct set forth in Section 1 of this Arti- cle VII. Such determination shall be made (i) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (ii) if such a quorum is not obtainable, or, even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (iii) by the stockholders of the Corporation. 9 Section 5. Notification and Defense of Claim. Promptly after receipt by a person seeking indemnification pursuant to this Article VII of notice of the commencement of any action, suit or proceeding, such person will, if a claim in respect thereof is to be made against the Corporation under this Article VII, notify the Corporation of the commencement thereof; but the omission so to notify the Corporation will not relieve it from any liability which it may have to such person otherwise than under this Article VII. With respect to any such action, suit or proceeding as to which such person notifies the Corporation of the commencement thereof: A. The Corporation will be entitled to participate therein at its own expense; and, B. Except as otherwise provided below, to the extent that it may wish, the Corporation jointly with any other in- demnifying party similarly notified will be entitled to assume the defense thereof, with counsel satisfactory to the person to be indemnified. After notice from the Corporation to the person to be indemnified of its election so to assume the defense thereof, the Corporation will not be liable to such person under this Article VII for any legal or other expenses subsequently incurred by such person in connection with the defense thereof other than reasonable costs of investigation or as otherwise provided below. The person to be indemnified shall have the right to employ his or her own counsel in such action, suit or proceeding but the fees and expenses of such counsel incurred after notice from the Corporation of its assumption of the defense thereof shall be at the expense of such person unless (i) the employment of counsel by such person has been authorized by the Corporation in connection with the defense of such action, (ii) such person shall have reasonably concluded that there may be a conflict of interest between the Corporation and such person in the conduct of the defense of such action, or (iii) the Corpo- ration shall not in fact have employed counsel to assume the defense of such action, in each of which cases the fees and expenses of counsel for such person shall be borne by the Corpo- ration (it being understood, however, that the Corporation shall not be liable for the expenses of more than one counsel for such person in connection with any action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances). The Corporation shall not be entitled to assume the defense of any action, suit or proceed- ing brought by or on behalf of the Corporation or as to which such person shall have made the conclusion provided for in (ii) above. C. Anything in this Section 5 to the contrary not- withstanding, the Corporation shall not be liable to indemnify any person seeking indemnification under this Article VII for any amounts paid in settlement of any action or claim effected with- out its written consent. The Corporation shall not settle any 10 action or claim in any manner which would impose any penalty or limitation on the person to be indemnified without such person's written consent. Neither the Corporation nor any such person will unreasonably withhold their consent to any proposed settlement. Section 6. Nonexclusivity. The indemnification and ad- vancement of expenses provided by or granted pursuant to this Ar- ticle VII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the General Corporation Law of the State of Delaware, the Corporation's Certificate of Incorporation, as amended, the Corporation's By-Laws, as now in effect or as here- after amended, any agreement, any vote of stockholders or direc- tors, any applicable law, or otherwise. Section 7. Indemnification of Other Expenses. In the event any person seeking indemnification hereunder is required to bring any action to enforce rights or to collect monies due under this Article VII and is successful in such action, the Corporation shall reimburse such person for all costs and expenses, including attorney's fees, incurred by such person in connection with such action. Section 8. Length of Effectiveness. The indemnification and advancement of expenses provided by or granted pursuant to this By-Law shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the ben- efit of the heirs, executors and administrators of such a person. ARTICLE VIII Amendment of By-Laws These By-Laws may be amended or repealed, and any new By-Law may be adopted, by the stockholders entitled to vote or by the Board of Directors. 11 EX-5 5 OPINION OF ROSENMAN & COLIN May 15, 1995 Securities and Exchange Commission Judiciary Plaza 450 Fifth Street, N.W. Washington, D.C. 20549 Gentlemen: We refer to the Registration Statement on Form S-8 to be filed by Acclaim Entertainment, Inc. (the "Company"), a Delaware corporation, with the Securities and Exchange Commission with respect to the registration of 6,000,000 shares of the Company's common stock, par value $0.02 per share, for issuance under the Company's 1988 Stock Option Plan. We have made such examination as we have deemed necessary for the purpose of this opinion. Based upon such examination, it is our opinion that said 6,000,000 shares have been duly authorized and, upon issuance in accordance with the terms of stock option agreements or certificates issued under said Plan, will be validly issued, fully paid and non-assessable. We hereby consent to the use of this opinion as Exhibit 5 to the Registration Statement. Very truly yours, ROSENMAN & COLIN By /s/ ------------------- A Partner -----END PRIVACY-ENHANCED MESSAGE-----