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EXHIBIT 3.1
FIFTH AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
NORTHWEST BIOTHERAPEUTICS, INC.
The undersigned, Daniel O. Wilds and C. William Schneider, hereby
certify that:
1. They are the duly elected and acting President and Secretary,
respectively, of Northwest Biotherapeutics, Inc., a Delaware corporation.
2. The Certificate of Incorporation of this corporation was originally
filed with the Secretary of State of Delaware on July 29, 1998.
3. The First Amended and Restated Certificate of Incorporation of this
corporation was filed with the Secretary of State of Delaware on September 15,
1998.
4. The Second Amended and Restated Certificate of Incorporation of this
corporation was filed with the Secretary of State of Delaware on March 26, 1999.
5. The Third Amended and Restated Certificate of Incorporation of this
corporation was filed with the Secretary of State of Delaware on October 24,
2000.
6. The Fourth Amended and Restated Certificate of Incorporation of this
corporation was filed with the Secretary of State of Delaware on June 1, 2001.
7. The Certificate of Incorporation of this corporation shall be amended
and restated to read in full as follows:
ARTICLE I
The name of the corporation is Northwest Biotherapeutics, Inc. (the
"Corporation").
ARTICLE II
The address of the Corporation's registered office in the State of
Delaware is 1013 Centre Road, Wilmington, Delaware 19805, County of New Castle.
The name of its registered agent at such address is Corporation Service Company.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the Delaware General
Corporation Law.
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ARTICLE IV
(A) Classes of Stock. The Corporation is authorized to issue two classes
of stock to be designated, respectively, "Common Stock" and "Preferred Stock."
The total number of shares which the Corporation is authorized to issue is
Forty-Two Million Five Hundred Thousand (42,500,000), each with a par value of
$0.001 per share. Thirty Million (30,000,000) shares shall be Common Stock and
Twelve Million Five Hundred Thousand (12,500,000) shares shall be Preferred
Stock.
(B) Rights, Preferences and Restrictions of Preferred Stock. The
Preferred Stock authorized by this Fifth Amended and Restated Certificate of
Incorporation "may" or "will" or "shall" be issued from time to time in one or
more series. The first series of Preferred Stock shall be designated "Series A
Preferred Stock" and shall consist of Five Hundred Fifty Thousand Seven Hundred
(550,700) shares. The second series of Preferred Stock shall be designated
"Series B Preferred Stock" and shall consist of Eight Hundred Ninety-Seven
Thousand Five Hundred Thirteen (897,513) shares. The third series of Preferred
Stock shall be designated "Series C Preferred Stock" and shall consist of Three
Million Six Hundred Nine Thousand Sixty-Two (3,609,062) shares. The fourth
series of Preferred Stock shall be designated "Series D Preferred Stock" and
shall consist of Six Million Five Hundred Thousand (6,500,000) shares. The
rights, preferences, privileges, and restrictions granted to and imposed on the
Series A, Series B, Series C, and Series D Preferred Stock are as set forth
below in this Article IV(B).
1. Dividend Provisions. Subject to the rights of each series of
Preferred Stock which may from time to time come into existence, the holders of
shares of Series A, Series B, Series C, and Series D Preferred Stock shall be
entitled to receive dividends, out of any assets legally available therefor,
prior and in preference to any declaration or payment of any dividend payable
(other than in Common Stock or other securities and rights convertible into or
entitling the holder thereof to receive, directly or indirectly, additional
shares of Common Stock of the Corporation) on the Common Stock of the
Corporation, at the rate of (a) $0.08 per share per annum, on each outstanding
share of Series A and Series B Preferred Stock, (b) $0.20 per share per annum,
on each outstanding share of Series C, and (c) $0.40 per share per annum on each
outstanding share of Series D Preferred Stock, payable quarterly when, as and if
declared by the Board of Directors. Such dividends shall not be cumulative.
2. Liquidation.
(a) Preference. In the event of any liquidation,
dissolution or winding up of the Corporation, either voluntary or involuntary,
subject to the rights of each series of Preferred Stock that may from time to
time come into existence, the holders of the Series A, Series B, Series C, and
Series D Preferred Stock shall be entitled to receive, prior and in preference
to any distribution of any of the assets of the Corporation to the holders of
Common Stock by reason of their ownership thereof, an amount per share equal to
(i) $5.447 per share for each share of Series A Preferred Stock then held by
them, (ii) $2.326 per share for each share of Series B Preferred Stock then held
by them, (iii) $2.50 per share for each share of Series C Preferred Stock then
held by them, and (iv) $5.00 per share for each share of Series D Preferred
Stock then held by them, plus declared but unpaid dividends. If, upon the
occurrence of such
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event, the assets and funds thus distributed among the holders of the Series A,
Series B, Series C, and Series D Preferred Stock shall be insufficient to permit
the payment to such holders of the full aforesaid preferential amounts, then,
subject to the rights of series of Preferred Stock that may from time to time
come into existence, the entire assets and funds of the Corporation legally
available for distribution shall be distributed ratably among the holders of the
Series A, Series B, Series C, and Series D Preferred Stock in proportion to the
preferential amount each such holder is otherwise entitled to receive.
(b) Remaining Assets. Upon the completion of the
distribution required by Section 2(a) above and any other distribution that may
be required with respect to series of Preferred Stock that may from time to time
come into existence, if assets remain in the Corporation, the holders of the
Common Stock of the Corporation shall receive all of the remaining assets of the
Corporation.
(c) Certain Acquisitions.
(i) Deemed Liquidation. For purposes of this
Section 2, a liquidation, dissolution or winding up of the
Corporation shall be deemed to occur if the Corporation shall
sell, convey, or otherwise dispose of or encumber all or
substantially all of its property or business or merge into or
consolidate with any other corporation (other than a wholly
owned subsidiary corporation) or effect any other transaction or
series of related transactions in which more than fifty percent
(50%) of the voting power of the Corporation is disposed of,
provided that this Section 2(c)(i) shall not apply to a merger
effected exclusively for the purpose of changing the domicile of
the Corporation.
(ii) Valuation of Consideration. In the event of
a deemed liquidation as described in Section 2(c)(i) above, if
the consideration received by the Corporation is other than
cash, its value will be deemed its fair market value. Any
securities shall be valued as follows:
(A) Securities not subject to investment
letter or other similar restrictions on free
marketability:
(1) If traded on a securities
exchange or the Nasdaq National Market, the value shall
be deemed to be the average of the closing prices of the
securities on such exchange over the thirty-day period
ending three (3) days prior to the closing;
(2) If actively traded
over-the-counter, the value shall be deemed to be the
average of the closing bid or sale prices (whichever is
applicable) over the thirty-day period ending three (3)
days prior to the closing; and
(3) If there is no active public
market, the value shall be the fair market value
thereof, as mutually determined by the Corporation
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and the holders of at least a majority of the voting
power of all then outstanding shares of Preferred Stock.
(B) The method of valuation of
securities subject to investment letter or other
restrictions on free marketability (other than
restrictions arising solely by virtue of a stockholder's
status as an affiliate or former affiliate) shall be to
make an appropriate discount from the market value
determined as above in Section 2(c)(ii)(A) to reflect
the approximate fair market value thereof, as mutually
determined by the Corporation and the holders of at
least a majority of the voting power of all then
outstanding shares of Preferred Stock.
(iii) Notice of Transaction. The Corporation shall give
each holder of record of Series A, Series B, Series C, or Series D
Preferred Stock written notice of such impending transaction within ten
(10) days prior to the stockholders' meeting called to approve such
transaction, or within ten (10) days prior to the closing of such
transaction, whichever is earlier, and shall also notify such holders in
writing of the final approval of such transaction. The first of such
notices shall describe the material terms and conditions of the
impending transaction and the provisions of Section 2, and the
Corporation shall thereafter give such holders prompt notice of any
material changes. The transaction shall in no event take place sooner
than ten (10) days after the Corporation has given the first notice
provided for herein or sooner than ten (10) days after the Corporation
has given notice of any material changes provided for herein; provided,
however, that such periods may be shortened upon the written consent of
the holders of Preferred Stock that are entitled to such notice rights
or similar notice rights and that represent at least a majority of the
voting power of all then outstanding shares of such Preferred Stock.
(iv) Effect of Noncompliance. In the event the
requirements of this Section 2(c) are not complied with, the Corporation
shall forthwith either cause the closing of the transaction to be
postponed until such requirements have been complied with, or cancel
such transaction, in which event the rights, preferences and privileges
of the holders of the Series A, Series B, Series C, and Series D
Preferred Stock shall revert to and be the same as such rights,
preferences and privileges existing immediately prior to the date of the
first notice referred to in Section 2(c)(iii) hereof.
3. Redemption.
(a) Redemption Date and Price. Subject to the rights of
each series of Preferred Stock which may from time to time come into existence,
at any time after March 18, 1999, but not later than March 18, 2002, on a date
(the "Redemption Date") within sixty (60) days after receipt by the Corporation
of a written request (a "Redemption Election") from the holders of not less than
a majority of the then outstanding Series A Preferred Stock that all of the
shares of such series be redeemed, the Corporation shall, to the extent it may
lawfully do so, redeem the number of shares of Series A Preferred Stock
specified in the Redemption Election in accordance with the procedures set forth
in this Section 3 by paying in cash therefor a sum per share equal to $5.447 per
share of Series A Preferred Stock (as adjusted for any stock dividends,
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combinations or splits with respect to such shares) plus an amount equal to the
interest on such sum from March 18, 1996 to the Redemption Date, at the rate of
prime plus one percent (1%) per annum, adjusted monthly based upon the prime
rate in effect on the 1st day of each month following March 18, 1996, and
compounded monthly (the "Redemption Price").
(b) Procedure. Subject to the rights of each series of
Preferred Stock which may from time to time come into existence within fifteen
(15) days following its receipt of the Redemption Election, the Corporation
shall mail a written notice, first-class postage prepaid, to each holder of
record (at the close of business on the business day next preceding the day on
which notice is given) of Series A Preferred Stock at the address last shown on
the records of the Corporation for such holder, notifying such holder of the
redemption to be effected, specifying the number of shares to be redeemed from
such holder, the Redemption Date, the applicable Redemption Price, the place at
which payment may be obtained and calling upon such holder to surrender to the
Corporation, in the manner and at the place designated, such holder's
certificate or certificates representing the shares to be redeemed (the
"Redemption Notice"). Except as provided in Section 3(c), on or after the
Redemption Date, each holder of Series A Preferred Stock to be redeemed shall
surrender to the Corporation the certificate or certificates representing such
shares, in the manner and at the place designated in the Redemption Notice, and
thereupon the Redemption Price of such shares shall be payable to the order of
the person whose name appears on such certificate or certificates as the owner
thereof and each surrendered certificate shall be canceled.
(c) Effect of Redemption; Insufficient Funds. From and
after the Redemption Date, unless there shall have been a default in payment of
the Redemption Price, all rights of the holders of shares of Series A Preferred
Stock designated for redemption in the Redemption Notice (except the right to
receive the Redemption Price without interest upon surrender of their
certificate or certificates) shall cease with respect to such shares, and such
shares shall not thereafter be transferred on the books of the Corporation or be
deemed to be outstanding for any purpose whatsoever. Subject to the rights of
series of Preferred Stock which may from time to time come into existence, if
the funds of the Corporation legally available for redemption of shares of
Series A Preferred Stock on the Redemption Date are insufficient to redeem the
total number of shares of Series A Preferred Stock to be redeemed on such date,
those funds which are legally available will be used to redeem the maximum
possible number of such shares ratably among the holders of such shares to be
redeemed based upon the total Redemption Price applicable to each such holder's
shares of Series A Preferred Stock which are subject to redemption on such
Redemption Date. The shares of Series A Preferred Stock not redeemed shall
remain outstanding and entitled to all the rights and preferences provided
herein. Subject to the rights of series of Preferred Stock which may from time
to time come into existence, at any time thereafter when additional funds of the
Corporation are legally available for the redemption of shares of Series A
Preferred Stock, such funds will immediately be used to redeem the balance of
the shares which the Corporation has become obliged to redeem on the Redemption
Date but which it has not redeemed.
4. Conversion. The holders of the Series A, Series B, Series C,
and Series D Preferred Stock shall have conversion rights as follows (the
"Conversion Rights"):
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(a) Right to Convert. Subject to Section 4(c), each
share of Series A, Series B, Series C, and Series D Preferred Stock shall be
convertible, at the option of the holder thereof, at any time after the date of
issuance of such shares and, with respect to the Series A Preferred Stock, on or
prior to the fifth day prior to the Redemption Date, if any, as may have been
fixed in any Redemption Notice with respect to the Series A Preferred Stock at
the office of the Corporation or any transfer agent for such stock, into such
number of fully paid and nonassessable shares of Common Stock as is determined
by dividing (i) $5.447 in the case of the Series A Preferred Stock, (ii) $2.326
in the case of the Series B Preferred Stock, (iii) $2.50 in the case of the
Series C Preferred Stock, and (iv) $5.00 in the case of the Series D Preferred
Stock by the conversion price applicable to such share, determined as hereafter
provided, in effect on the date the certificate is surrendered for conversion.
The initial conversion price shall be $5.447 for shares of Series A Preferred
Stock ("Series A Conversion Price"), $1.2003 for shares of Series B Preferred
Stock ("Series B Conversion Price"), $2.50 for shares of Series C Preferred
Stock ("Series C Conversion Price"), and $5.00 for shares of Series D Preferred
Stock ("Series D Conversion Price"). Such initial conversion price shall be
subject to adjustment as set forth in Section 4(d) below.
(b) Automatic Conversion. Each share of Series A, Series
B, Series C, and Series D Preferred Stock shall automatically be converted into
shares of Common Stock at the conversion price at the time in effect for such
share immediately upon the earlier of (i) except as provided below in Section
4(c), the Corporation's sale of its Common Stock in a firm commitment
underwritten public offering pursuant to a registration statement under the
Securities Act of 1933, as amended (the "Securities Act"), which results in
aggregate cash proceeds to the Corporation of $7,500,000 (net of underwriting
discounts and commissions) or (ii) the date specified by written consent or
agreement of the holders of a majority of the then outstanding shares of Series
A, Series B, Series C, and Series D Preferred Stock, voting together as a class.
(c) Mechanics of Conversion. Before any holder of Series
A, Series B, Series C, or Series D Preferred Stock shall be entitled to convert
the same into shares of Common Stock, he shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation or of any
transfer agent for such series of Preferred Stock, and shall give written notice
to the Corporation, at its principal corporate office, of the election to
convert the same and shall state therein the name or names in which the
certificate or certificates for shares of Common Stock are to be issued. The
Corporation shall, as soon as practicable thereafter, issue and deliver at such
office to such holder of Preferred Stock, or to the nominee or nominees of such
holder, a certificate or certificates for the number of shares of Common Stock
to which such holder shall be entitled as aforesaid. Such conversion shall be
deemed to have been made immediately prior to the close of business on the date
of such surrender of the shares of such series of Preferred Stock to be
converted, and the person or persons entitled to receive the shares of Common
Stock issuable upon such conversion shall be treated for all purposes as the
record holder or holders of such shares of Common Stock as of such date. If the
conversion is in connection with an underwritten offering of securities
registered pursuant to the Securities Act the conversion may, at the option of
any holder tendering such Preferred Stock for conversion, be conditioned upon
the closing with the underwriters of the sale of securities pursuant to such
offering, in which event the person(s) entitled to receive Common Stock upon
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conversion of such Preferred Stock shall not be deemed to have converted such
Preferred Stock until immediately prior to the closing of such sale of
securities.
(d) Conversion Price Adjustments of Preferred Stock for
Certain Issuances, Splits and Combinations. The conversion price of the Series
A, Series B, Series C, and Series D Preferred Stock shall be subject to
adjustment from time to time as follows:
(i) Series C and Series D Antidilution
Protection for Issuances of Additional Stock Below Series C or
Series D Purchase Price. If the Corporation shall issue, after
the date upon which any shares of Series C or Series D Preferred
Stock were first issued (the "Purchase Date"), any Additional
Stock (as defined below) without consideration or for a
consideration per share less than the Series C Conversion Price
or the Series D Conversion Price, as the case may be, in effect
immediately prior to the issuance of such Additional Stock, the
Series C Conversion Price or the Series D Conversion Price, as
the case may be, in effect immediately prior to each such
issuance shall automatically be adjusted as set forth in this
Section 4(d)(i), unless otherwise provided in this Section
4(d)(i).
(A) Adjustment Formula. Whenever the
Series C Conversion Price or the Series D Conversion
Price is adjusted pursuant to this Section (4)(d)(i),
the new Series C Conversion Price or Series D Conversion
Price shall be determined by multiplying the Series C
Conversion Price or Series D Conversion Price then in
effect by a fraction, (x) the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such issuance (the "Outstanding
Common") plus the number of shares of Common Stock that
the aggregate consideration received by the Corporation
for such issuance would purchase at such Series C
Conversion Price or Series D Conversion Price; and (y)
the denominator of which shall be the number of shares
of Outstanding Common plus the number of shares of such
Additional Stock. For purposes of the foregoing
calculation, the term "Outstanding Common" shall include
shares of Common Stock deemed issued pursuant Section
4(d)(i)(E) below.
(B) Definition of "Additional Stock".
For purposes of this Section 4(d)(i), "Additional Stock"
shall mean any shares of Common Stock issued (or deemed
to have been issued pursuant to Section 4(d)(i)(E)) by
the Corporation after the Purchase Date) other than:
(1) Common Stock issued pursuant to
a transaction described in Section 4(d)(ii) hereof;
(2) Shares of Common Stock issuable
or issued to employees, consultants or directors of the
Corporation directly or pursuant to a stock option plan
or restricted stock plan approved by the Board of
Directors of the Corporation;
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(3) Capital stock, or options or
warrants to purchase capital stock, issued to financial
institutions or lessors in connection with commercial
credit arrangements, equipment financing or similar
transactions;
(4) Capital stock, or options or
warrants to purchase capital stock, issued to academic
or research institutions in connection with the license
of technology or research and development services, or
issued to a strategic partner in connection with a
license agreement, joint marketing agreement, technology
development or similar strategic relationship;
(5) Shares of Common Stock or
Preferred Stock issuable upon exercise of warrants
outstanding as of the date of this Fifth Amended and
Restated Certificate of Incorporation;
(6) Capital stock or warrants or
options to purchase capital stock issued in connection
with bona fide acquisitions, mergers or similar
transactions, the terms of which are approved by the
Board of Directors of the Corporation;
(7) Shares of Common Stock issued
or issuable upon conversion of the Preferred Stock; and
(8) Shares of Common Stock issued
or issuable in a public offering prior to or in
connection with which all outstanding shares of
Preferred Stock will be converted to Common Stock.
(C) No Fractional Adjustments. No
adjustment of the Conversion Price for the Series C or
Series D Preferred Stock shall be made in an amount less
than one cent per share, provided that any adjustments
which are not required to be made by reason of this
sentence shall be carried forward and shall be either
taken into account in any subsequent adjustment made
prior to three years from the date of the event giving
rise to the adjustment being carried forward, or shall
be made at the end of three years from the date of the
event giving rise to the adjustment being carried
forward.
(D) Determination of Consideration. In
the case of the issuance of Common Stock for cash, the
consideration shall be deemed to be the amount of cash
paid therefor before deducting any reasonable discounts,
commissions or other expenses allowed, paid or incurred
by the Corporation for any underwriting or otherwise in
connection with the issuance and sale thereof. In the
case of the issuance of Common Stock for a consideration
in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair value
thereof as determined by the Board of Directors
irrespective of any accounting treatment.
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(E) Deemed Issuances of Common Stock. In
the case of the issuance (whether before, on or after
the applicable Purchase Date) of options to purchase or
rights to subscribe for Common Stock, securities by
their terms convertible into or exchangeable for Common
Stock or options to purchase or rights to subscribe for
such convertible or exchangeable securities, the
following provisions shall apply for all purposes of
this Section 4(d)(i) (and for the purpose specified in
Section 4(d)(ii)):
(1) The aggregate maximum number of
shares of Common Stock deliverable upon exercise
(assuming the satisfaction of any conditions to
exercisability, including, without limitation, the
passage of time, but without taking into account
potential antidilution adjustments) of such options to
purchase or rights to subscribe for Common Stock shall
be deemed to have been issued at the time such options
or rights were issued and for a consideration equal to
the consideration (determined in the manner provided in
Section 4(d)(i)(D)), if any, received by the Corporation
upon the issuance of such options or rights plus the
minimum exercise price provided in such options or
rights (without taking into account potential
antidilution adjustments) for the Common Stock covered
thereby.
(2) The aggregate maximum number of
shares of Common Stock deliverable upon conversion of or
in exchange (assuming the satisfaction of any conditions
to convertibility or exchangeability, including, without
limitation, the passage of time, but without taking into
account potential antidilution adjustments) for any such
convertible or exchangeable securities or upon the
exercise of options to purchase or rights to subscribe
for such convertible or exchangeable securities and
subsequent conversion or exchange thereof shall be
deemed to have been issued at the time such securities
were issued or such options or rights were issued and
for a consideration equal to the consideration, if any,
received by the Corporation for any such securities and
related options or rights (excluding any cash received
on account of accrued interest or accrued dividends),
plus the minimum additional consideration, if any, to be
received by the Corporation (without taking into account
potential antidilution adjustments) upon the conversion
or exchange of such securities or the exercise of any
related options or rights (the consideration in each
case to be determined in the manner provided in Section
4(d)(i)(D)).
(3) In the event of any change in
the number of shares of Common Stock deliverable or in
the consideration payable to the Corporation upon
exercise of such options or rights or upon conversion of
or in exchange for such convertible or exchangeable
securities, including, but not limited to, a change
resulting from the antidilution provisions thereof, the
Series C Conversion Price and the Series D Conversion
Price, to the extent in any way affected by or computed
using such options, rights or securities, shall be
recomputed to reflect such change, but no further
adjustment shall be made for the actual issuance of
Common Stock or any payment of such consideration upon
the
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exercise of any such options or rights or the conversion
or exchange of such securities.
(4) Upon the expiration of any such
options or rights, the termination of any such rights to
convert or exchange, or the expiration of any options or
rights related to such convertible or exchangeable
securities, the Series C Conversion Price and the Series
D Conversion Price, to the extent in any way affected by
or computed using such options, rights or securities or
options or rights related to such securities, shall be
recomputed to reflect the issuance of only the number of
shares of Common Stock (and convertible or exchangeable
securities which remain in effect) actually issued upon
the exercise of such options or rights, upon the
conversion or exchange of such securities or upon the
exercise of the options or rights related to such
securities.
(5) The number of shares of Common
Stock deemed issued and the consideration deemed paid
therefor pursuant to Sections 4(d)(i)(E)(l) and
4(d)(i)(E)(2) shall be appropriately adjusted to reflect
any change, termination or expiration of the type
described in either Section 4(d)(i)(E)(3) or
4(d)(i)(E)(4).
(F) No Increased Conversion Price.
Notwithstanding any other provisions of this Section
(4)(d)(i), except to the limited extent provided for in
Sections 4(d)(i)(E)(3) and 4(d)(i)(E)(4), no adjustment
of the Series C Conversion Price or the Series D
Conversion Price pursuant to this Section 4(d)(i) shall
have the effect of increasing the Series C Conversion
Price or Series D Conversion Price above the Series C
Conversion Price or Series D Conversion Price, as the
case may be, in effect immediately prior to such
adjustment.
(ii) Stock Splits and Dividends. In the event
the Corporation should at any time or from time to time after
the date upon which any shares of Series A, Series B, Series C,
or Series D Preferred Stock were first issued (the "Purchase
Date," with respect to such series) fix a record date for the
effectuation of a split or subdivision of the outstanding shares
of Common Stock or the determination of holders of Common Stock
entitled to receive a dividend or other distribution payable in
additional shares of Common Stock or other securities or rights
convertible into, or entitling the holder thereof to receive
directly or indirectly, additional shares of Common Stock
(hereinafter referred to as "Common Stock Equivalents") without
payment of any consideration by such holder for the additional
shares of Common Stock or the Common Stock Equivalents
(including the additional shares of Common Stock issuable upon
conversion or exercise thereof), then, as of such record date
(or the date of such, dividend distribution, split or
subdivision if no record date is fixed), the Series A, Series B,
Series C, and Series D Conversion Price shall be appropriately
decreased so that the number of shares of Common Stock issuable
on conversion of each share of such series shall be increased in
proportion to such increase of the aggregate of shares of Common
Stock outstanding and those issuable with respect to such Common
Stock Equivalents
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with the number of shares issuable with respect to Common Stock
Equivalents determined from time to time as provided in Section
4(d)(iv) below.
(iii) Reverse Stock Splits. If the number of
shares of Common Stock outstanding at any time the Purchase Date
is decreased by a combination of the outstanding shares of
Common Stock, then, following the record date of such
combination, the Series A, Series B, Series C, and Series D
Conversion Price shall be appropriately increased so that the
number of shares of Common Stock issuable on conversion of each
share of such series shall be decreased in proportion to such
decrease in outstanding shares.
(iv) The following provisions shall apply for
the purposes of this Section 4(d):
(A) The aggregate maximum number of
shares of Common Stock deliverable upon conversion or exercise
of Common Stock Equivalents (assuming the satisfaction of any
conditions to convertibility or exercisability, including,
without limitation, the passage of time, but without taking into
account potential antidilution adjustments) shall be deemed to
have been issued at the time such Common Stock Equivalents were
issued.
(B) In the event of any change in the
number of shares of Common Stock deliverable or in the
consideration payable to the Corporation upon conversion or
exercise of such Common Stock Equivalents including, but not
limited to, a change resulting from the antidilution provisions
thereof, the Series A, Series B, Series C, and the Series D
Conversion Price, to the extent in any way affected by or
computed using such Common Stock Equivalents, shall be
recomputed to reflect such change, but no further adjustment
shall be made for the actual issuance of Common Stock or any
payment of such consideration upon the exercise of any such
options or rights or the conversion or exchange of such
securities.
(C) Upon the termination or expiration
of the convertibility or exercisability of any such Common Stock
Equivalents, the conversion price of each of the Series A,
Series B, Series C, and the Series D Preferred Stock, to the
extent in any way affected by or computed using such Common
Stock Equivalents, shall be recomputed to reflect the issuance
of only the number of shares of Common Stock (and Common Stock
Equivalents which remain convertible or exercisable) actually
issued upon the conversion or exercise of such Common Stock
Equivalents.
(e) Other Distributions. In the event the Corporation
shall declare a distribution payable in securities of other persons, evidences
of indebtedness issued by the Corporation or other persons, assets (excluding
cash dividends) or options or rights not referred to in Section 4(d)(ii), then,
in each such case for the purpose of this Section 4(e), the holders of Series A,
Series B, Series C, and Series D Preferred Stock shall be entitled to a
proportionate
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share of any such distribution as though they were the holders of the number of
shares of Common Stock of the Corporation into which their shares of Preferred
Stock are convertible as of the record date fixed for the determination of the
holders of Common Stock of the Corporation entitled to receive such
distribution.
(f) Recapitalizations. If at any time or from time to
time there shall be a recapitalization of the Common Stock (other than a
subdivision, combination or merger or sale of assets transaction provided for
elsewhere in this Section 4 or Section 2), provision shall be made so that the
holders of the Series A, Series B, Series C, and Series D Preferred Stock shall
thereafter be entitled to receive upon conversion of such Preferred Stock the
number of shares of stock or other securities or property of the Corporation, or
otherwise, to which a holder of Common Stock upon conversion would have been
entitled on such recapitalization. In any such case, appropriate adjustment
shall be made in the application of the provisions of this Section 4 with
respect to the rights of the holders of such Preferred Stock after the
recapitalization to the end that the provisions of this Section 4 (including
adjustment of the Conversion Price then in effect and the number of shares
purchasable upon conversion of such Preferred Stock) shall be applicable after
that event and be as nearly equivalent as practicable.
(g) No Impairment. The Corporation will not, by
amendment of its Certificate of Incorporation or through any reorganization,
recapitalization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Corporation, but will at all times in good faith assist in the
carrying out of all the provisions of this Section 4 and in the taking of all
such action as may be necessary or appropriate in order to protect the
Conversion Rights of the holders of Preferred Stock against impairment.
(h) No Fractional Shares and Certificate as to
Adjustments.
(i) No fractional shares shall be issued upon
the conversion of any share or shares of the Series A, Series B,
Series C, or Series D Preferred Stock, and the number of shares
of Common Stock to be issued shall be rounded to the nearest
whole share. The number of shares issuable upon such conversion
shall be determined on the basis of the total number of shares
of Series A, Series B, Series C, and Series D Preferred Stock
the holder is at the time converting into Common Stock and the
number of shares of Common Stock issuable upon such aggregate
conversion.
(ii) Upon the occurrence of each adjustment or
readjustment of the Conversion Price of Series A, Series B,
Series C, or Series D Preferred Stock pursuant to this Section
4, the Corporation, at its expense, shall promptly compute such
adjustment or readjustment in accordance with the terms hereof
and prepare and furnish to each holder of such Preferred Stock a
certificate setting forth such adjustment or readjustment and
showing in detail the facts upon which such adjustment or
readjustment is based. The Corporation shall, upon the written
request at any time of any holder of Series A, Series B, Series
C, or Series D Preferred Stock, furnish or cause to be furnished
to such holder a like certificate setting forth: (A) the
calculation of such adjustment or
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readjustment; (B) the Conversion Price for the Series A, Series
B, Series C, or Series D Preferred Stock; as the case may be, at
the time in effect; and (C) the number of shares of Common Stock
and the amount, if any, of other property which at the time
would be received upon the conversion of a share of the Series
A, Series B, Series C, or Series D Preferred Stock, as the case
may be.
(i) Notices of Record Date. In the event of any taking
by the Corporation of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any
dividend (other than a cash dividend) or other distribution, any right to
subscribe for, purchase or otherwise acquire any shares of stock of any class or
any other securities or property, or to receive any other right, the Corporation
shall mail to each holder of Series A, Series B, Series C, or Series D Preferred
Stock, at least ten (10) days prior to the date specified therein, a notice
specifying the date on which any such record is to be taken for the purpose of
such dividend, distribution or right, and the amount and character of such
dividend, distribution or right.
(j) Reservation of Stock Issuable Upon Conversion. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of effecting the
conversion of the shares of the Series A, Series B, Series C, and Series D
Preferred Stock, such number of its shares of Common Stock as shall from time to
time be sufficient to effect the conversion of all outstanding shares of such
series of Preferred Stock; and if at any time the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the conversion
of all then outstanding shares of such series of Preferred Stock, in addition to
such other remedies as shall be available to the holder of such Preferred Stock,
the Corporation will take such corporate action as may, in the opinion of its
counsel, be necessary to increase its authorized but unissued shares of Common
Stock to such number of shares as shall be sufficient for such purposes,
including, without limitation, engaging in best efforts to obtain the requisite
stockholder approval of any necessary amendment to this Certificate of
Incorporation.
(k) Notices. Any notice required by the provisions of
this Section 4 to be given to the holders of shares of Series A, Series B,
Series C, or Series D Preferred Stock shall be deemed given if deposited in the
United States mail, postage prepaid, and addressed to each holder of record at
his address appearing on the books of the Corporation.
5. Voting Rights. The holder of each share of Series A, Series
B, Series C, or Series D Preferred Stock shall have the right to one vote for
each share of Common Stock into which such Preferred Stock could then be
converted, and with respect to such vote, such holder shall have full voting
rights and powers equal to the voting rights and powers of the holders of Common
Stock, and shall be entitled, notwithstanding any provision hereof, to notice of
any stockholders' meeting in accordance with the bylaws of the Corporation, and
shall be entitled to vote, together with holders of Common Stock, with respect
to any question upon which holders of Common Stock have the right to vote.
Fractional votes shall not, however, be permitted and any fractional voting
rights available on an as-converted basis (after aggregating all shares into
which shares of Series A, Series B, Series C, or Series D Preferred Stock held
by each holder
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could be converted) shall be rounded to the nearest whole number (with one-half
being rounded, upward).
6. Protective Provisions. Subject to the rights of each series
of Preferred Stock which may from time to time come into existence, so long as
at least 100,000 shares of Preferred Stock are outstanding (as adjusted for
stock splits, stock dividends or recapitalizations), the Corporation shall not
without first obtaining the approval (by vote or written consent, as provided by
law) of the holders of at least a majority of the then outstanding shares of
Preferred Stock, voting together as a class:
(a) effect a transaction described in Article IV(B),
Section 2(c)(i) above;
(b) alter or change the rights, preferences or
privileges of the shares of Series A, Series B, Series C, or Series D Preferred
Stock so as to affect adversely the shares of such series;
(c) increase or decrease (other than by redemption or
conversion) the total number of authorized shares of Series A, Series B, Series
C, or Series D Preferred Stock;
(d) authorize or issue, or obligate itself to issue, any
other equity security, including any other security convertible into or
exercisable for any equity security, having a preference over the Series A,
Series B, Series C, or Series D Preferred Stock with respect to voting,
dividends, redemption, conversion or upon liquidation; or
(e) redeem, purchase or otherwise acquire (or pay into
or set funds aside for a sinking fund for such purpose) any share or shares of
Preferred Stock or Common Stock; provided, however, that this restriction shall
not apply to the repurchase of shares of Common Stock from employees, officers,
directors, consultants or other persons performing services for the Corporation
or any subsidiary pursuant to agreements under which the Corporation has the
option to repurchase such shares at cost upon the occurrence of certain events,
such as the termination of employment, or through the exercise of any right of
first refusal.
7. Status of Redeemed or Converted Stock. In the event any
shares of Preferred Stock shall be redeemed pursuant to Section 3 or converted
pursuant to Section 4 of this Article IV(B), the shares so redeemed or converted
shall be canceled and shall not be issuable by the Corporation. The Certificate
of Incorporation of the Corporation shall be appropriately amended to effect the
corresponding reduction in the Corporation's authorized capital stock.
(C) Common Stock.
1. Dividend Rights. Subject to the prior rights of holders of
all classes of stock at the time outstanding having prior rights as to
dividends, the holders of the Common Stock shall be entitled to receive, when
and as declared by the Board of Directors, out of any
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assets of the Corporation legally available therefor, such dividends as may be
declared from time to time by the Board of Directors.
2. Liquidation Rights. Upon the liquidation, dissolution or
winding up of the Corporation, the assets of the Corporation shall be
distributed as provided in Section 2 of Article IV(B).
3. Redemption. The Common Stock is not redeemable.
4. Voting Rights. The holder of each share of Common Stock shall
have the right to one vote, and shall be entitled to notice of any stockholders'
meeting in accordance with the bylaws of the Corporation, and shall be entitled
to vote upon such matters and in such manner as may be provided by law.
5. Protective Provision. The Corporation shall not, without
first obtaining the approval (by vote or written consent, as provided by law) of
the holders of at least a majority of the outstanding shares of Common Stock,
voting as a separate class, effect a transaction described in Section 2(c)(i) of
Article IV(B).
ARTICLE V
The Board of Directors of the Corporation is expressly authorized to
adopt, amend or repeal Bylaws or adopt new Bylaws; provided however, that the
Board of Directors may not repeal or amend any bylaw that stockholders have
expressly provided may not be amended or repealed by the Board of Directors. The
stockholders shall also have the power to adopt, amend or repeal the Bylaws of
this Corporation by the affirmative vote of the holders of not less than
two-thirds of the outstanding shares entitled to vote thereon and, to the
extent, if any, provided by resolution adopted by the Board of Directors
authorizing the issuance of a class of series of Common Stock or Preferred
Stock, by the affirmative vote of the holders of not less than two-thirds of the
outstanding shares of such class or series, voting as a separate group.
ARTICLE VI
(A) Board of Directors. The business and affairs of the Corporation
shall be managed under the direction of a Board of Directors, the number of
which shall be fixed from time to time exclusively by the Board of Directors
pursuant to a resolution adopted by a majority of the total number of authorized
directors (whether or not there exist any vacancies in previously authorized
directorships at the time any such resolution is presented to the Board for
adoption) (the "Whole Board"). The Directors shall be classified with respect to
the time for which they shall severally hold office by dividing them into three
classes, Class I, Class II and Class III, each consisting as nearly as possible
of one-third of the Whole Board. All Directors shall hold office until their
successors are elected and qualified, or until their earlier death, resignation,
disqualification or removal. Class I Directors shall be elected for a term of
one year; Class II Directors shall be elected for a term of two years; and Class
III Directors shall be elected for a term of three years; and at each annual
stockholders' meeting thereafter, successors to the Directors whose terms shall
expire that year shall be elected to hold office for a term of three years, so
that the term of
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office of one class of Directors shall expire in each year. Any vacancy on the
Board of Directors that results from an increase in the number of Directors may
be filled by the affirmative vote of a majority of the Directors then in office
and a majority of the Continuing Directors, voting separately and as a subclass
of Directors, and any other vacancy on the Board of Directors may be filled by
the affirmative vote of a majority of the Directors then in office, although
less than a quorum, or by a sole remaining Director. Any Director elected to
fill a vacancy not resulting from an increase in the number of Directors shall
serve for a term equivalent to the remaining unserved portion of the term of
such newly elected Director's predecessor. Notwithstanding the foregoing,
whenever the holders of any one or more classes or series of preferred stock
issued by the Corporation shall have the right, voting separately by class or
series, to elect Directors at an annual or special meeting of stockholders, the
election, term of office, filling of vacancies and other features of such
Directorships shall be governed by the terms of this Amended and Restated
Certificate of Incorporation applicable thereto, and such Directors shall not be
divided into classes pursuant to this Section (A) unless expressly provided by
such terms.
(B) Removal of Directors by Stockholders. A Director may be removed from
office only for "cause" at a special meeting of stockholders called for that
purpose, by the affirmative vote of the holders of not less than two-thirds of
the shares entitled to elect the Director or Directors whose removal is being
sought. The vacancy created by the removal of any Director under this Section
(B) shall be filled only by the affirmative vote of the holders of at least
two-thirds of the shares entitled to elect the Director who was removed. As used
herein, "cause" shall mean (a) willful and continued material failure, refusal
or inability to perform the Director's duties to the corporation or the willful
engaging in gross misconduct that is materially and demonstrably damaging to the
corporation; or (b) conviction for any crime involving moral turpitude or any
other illegal act that materially and adversely reflects upon the business,
affairs or reputation of the corporation or on the Director's ability to perform
the Director's duties to the corporation.
ARTICLE VII
(A) To the fullest extent permitted by the Delaware General Corporation
Law, as the same exists or as may hereafter be amended, a director of the
Corporation shall not be personally liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director.
(B) The Corporation shall indemnify to the fullest extent permitted by
law any person made or threatened to be made a party to an action or proceeding,
whether criminal, civil, administrative or investigative, by reason of the fact
that he, his testator or intestate is or was a director or officer of the
Corporation or any predecessor of the Corporation, or serves or served at any
other enterprise as a director or officer at the request of the Corporation or
any predecessor to the Corporation.
(C) Neither any amendment nor repeal of this Article VII, nor the
adoption of any provision of the Corporation's Certificate of Incorporation
inconsistent with this Article VII, shall eliminate or reduce the effect of this
Article VII in respect of any matter occurring, or any
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action or proceeding accruing or arising or that, but for this Article VII,
would accrue or arise, prior to such amendment, repeal or adoption of an
inconsistent provision.
ARTICLE VIII
(A) Amendments to Restated Certificate of Incorporation. The following
Articles and Sections may be amended or repealed only upon the affirmative vote
of the holders of at least two-thirds of the outstanding shares and, to the
extent, if any, provided by resolution adopted by the Board of Directors
authorizing the issuance of a class or series of Common Stock or Preferred
Stock, by the affirmative vote of the holders of at least two-thirds of the
outstanding shares of such class or series, voting as a separate voting group:
Article V ("Bylaws");
Article VI ("Directors");
Article VII ("Limitation of Director Liability");
Article VIII ("Amendments to Restated Certificate of Incorporation");
Article IX ("Business Combinations").
ARTICLE IX
(A) Business Combinations.
1. Definitions. For the purposes of this Article IX:
a. "Business Combination" means (i) a merger, share
exchange or consolidation of this corporation or any of its Subsidiaries with
any other corporation; (ii) the sale, lease, exchange, mortgage, pledge,
transfer or other disposition or encumbrance, whether in one transaction or a
series of transactions, by this corporation or any of its Subsidiaries of all or
a substantial part of this corporation's assets otherwise than in the usual and
regular course of business; or (iii) any agreement, contract or other
arrangement providing for any of the foregoing transactions.
b. "Subsidiary" means a domestic or foreign corporation,
a majority of the outstanding voting shares of which are owned, directly or
indirectly, by this corporation.
2. Information Considered by Board of Directors. In considering
a Business Combination, the Board of Directors may take into account factors in
addition to potential economic benefits to the stockholders, including without
limitation (i) comparison of the proposed consideration to be received by
stockholders in relation to the then current market price of the corporation's
capital stock, the estimated current value of the corporation in a freely
negotiated transaction and the estimated future value of the corporation as an
independent entity,
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and (ii) the impact of such a transaction on the employees, suppliers and
customers of the corporation and its effect on the communities in which the
corporation operates.
The foregoing Fifth Amended and Restated Certificate of Incorporation
has been duly adopted by the Corporation's Board of Directors and stockholders
in accordance with the applicable provisions of Sections 228, 242 and 245 of the
General Corporation Law of the State of Delaware.
Executed at Seattle, Washington, on June 21, 2001.
/s/ Daniel O. Wilds
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Daniel O. Wilds, President
/s/ C. William Schneider
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C. William Schneider, Secretary
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