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SECOND RESTATED Exhibit 3.1
ARTICLES OF INCORPORATION
OF
INNOVA CORPORATION
ARTICLE I.
Name.
The name of the corporation is Innova Corporation.
ARTICLE II.
Authorized Shares.
2.1 The corporation is authorized to issue a total of 35,000,000
shares of two classes of stock without par value: 30,000,000 shares of Common
Stock and 5,000,000 shares of Preferred Stock. Holders of Common Stock are
entitled to one vote per share on any matter on which holders of Common Stock
are entitled to vote. On dissolution of the corporation, after any preferential
amount with respect to the Preferred Stock has been paid or set aside, the
holders of Common Stock and the holders of any series of Preferred Stock
entitled to participate further in the distribution of assets are entitled to
receive the net assets of the corporation.
2.2 The Board of Directors is authorized, subject to limitations
prescribed by the Washington Business Corporation Act (the "Act") and by the
provisions of this Article II, to provide for the issuance of shares of
Preferred Stock in series, to establish from time to time the number of shares
to be included in each series and to determine the designations, relative
rights, preferences and limitations of the shares of each series. The
authority of the Board of Directors with respect to each series includes
determination of the following:
2.2.1 The number of shares in and the distinguishing
designation of that series.
2.2.2 Whether shares of that series shall have full,
special, conditional, limited or no voting rights, except to the extent
otherwise provided by the Act.
2.2.3 Whether shares of that series shall be convertible
and the terms and conditions of the conversion, including provision for
adjustment of the conversion rate in circumstances determined by the Board of
Directors.
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2.2.4 Whether shares of that series shall be redeemable and
the terms and conditions of redemption, including the date or dates upon or
after which they shall be redeemable and the amount per share payable in case
of redemption, which amount may vary under different conditions or at different
redemption dates.
2.2.5 The dividend rate, if any, on shares of that series,
the manner of calculating any dividends and the preference of any dividends.
2.2.6 The rights of shares of that series in the event of
voluntary or involuntary dissolution of the corporation and the rights of
priority of that series relative to the Common Stock and any other series of
Preferred Stock on the distribution of assets on dissolution.
2.2.7 Any other rights, preferences and limitations of that
series that are permitted by the Act.
Within any limits stated in these Articles or in the resolution of the
Board of Directors establishing a series, the Board of Directors, after the
issuance of shares of a series, may amend the resolution establishing the
series to decrease (but not below the number of shares of such series then
outstanding) the number of shares of that series, and the number of shares
constituting the decrease shall thereafter constitute authorized but
undesignated shares, and the Board of Directors may amend the rights and
preferences of the shares of any series that has been established but is wholly
unissued.
The authority herein granted to the Board of Directors to determine
the relative rights and preferences of the preferred stock shall be limited to
unissued shares, and no power shall exist to alter or change the rights and
preferences of any shares that have been issued.
2.3 The Board of Directors shall have the authority to issue
shares of the capital stock of this corporation and the certificates therefor
subject to such transfer restrictions and other limitations as it may deem
necessary to promote compliance with applicable federal and state securities
laws, and to regulate the transfer thereof in such manner as may be calculated
to promote such compliance or to further any other reasonable purpose.
2.4 At any time when the corporation is subject to the reporting
requirements of Section 13 or Section 15(d) of the Securities Exchange Act of
1934, as amended, special meetings of the shareholders for any purpose or
purposes may be called only by the Board of Directors or the Chairman of the
Board (if one be appointed) or the President or one or more shareholders
holding
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shares representing not less than twenty-five percent (25%) of all the votes
entitled to be cast on any issue proposed to be considered at that meeting.
A quorum shall exist at any meeting of shareholders if a majority of
the votes entitled to be cast is represented in person or by proxy. In the
case of any meeting of shareholders that is adjourned more than once because of
the failure of a quorum to attend, those who attend the third convening of such
meeting, although less than a quorum, shall nevertheless constitute a quorum
for the purpose of electing directors, provided that the percentage of shares
represented at the third convening of such meeting shall not be less than
one-third of the shares entitled to vote.
2.5 Except as otherwise specifically provided herein and subject
to the limitations set forth in RCW 23B.19.040, to the extent applicable:
2.5.1 The corporation may enter into contracts and
otherwise transact business as vendor, purchaser, lender, borrower, or
otherwise with its shareholders and with corporations, associations, firms, and
entities in which they are or may be or become interested as directors,
officers, shareholders, members, or otherwise.
2.5.2 Any such contract or transaction shall not be
affected or invalidated or give rise to liability by reason of the
shareholder's having an interest in the contract or transaction.
2.6 Subject to the requirements of RCW 23B.08.730 and RCW
23B.19.040, any contract, transaction, or act of the corporation or of any
director or officer of the corporation that shall be authorized, approved, or
ratified by the affirmative vote of a majority of shares represented at a
meeting at which a quorum is present shall, insofar as permitted by law, be as
valid and as binding as though ratified by every shareholder of the
corporation.
ARTICLE III.
Directors.
3.1 Subject to the provisions of Article II hereof, the number of
directors of the corporation and the manner in which such directors are to be
elected shall be as set forth in the Bylaws.
3.2 Subject to the limitation(s) of RCW 23B.10.210, and subject to
the power of the shareholders of the corporation to change or repeal the
Bylaws, the Board of Directors shall have the power to amend or repeal the
Bylaws, or adopt new Bylaws for this corporation, as provided in the Bylaws.
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3.3 Subject to the limitations set forth in RCW 23B.08.700 through
RCW 23B.08.730:
3.3.1 The corporation may enter into contracts and
otherwise transact business as vendor, purchaser, lender, borrower, or
otherwise with its directors and with corporations, associations, firms, and
entities in which they are or may be or become interested as directors,
officers, shareholders, members, or otherwise.
3.3.2 Any such contract or transaction shall not be
affected or invalidated or give rise to liability by reason of the director's
having an interest in the contract or transaction.
ARTICLE IV.
Shareholder Rights.
4.1 No Preemptive Rights. No shareholder of this corporation
shall have, solely by reason of being a shareholder, any preemptive or
preferential right or subscription right to any stock of this corporation or to
any obligations convertible into stock of this corporation, or to any warrant
or option for the purchase thereof, except to the extent provided by resolution
or resolutions of the Board of Directors establishing a series of Preferred
Stock or by written agreement with this corporation.
4.2 No Cumulative Voting. In any election for directors of the
corporation, a holder of shares of any class or series of stock then entitled
to vote has the right to vote in person or by proxy the number of shares of
stock held thereby for as many persons as there are directors to be elected.
No cumulative voting for directors shall be permitted.
4.3 Vote Required for Merger, Share Exchange, Sale of Assets and
Dissolution. The approval of any plan of merger, plan of share exchange, sale,
lease, exchange or other disposition of all, or substantially all, of the
corporation's property otherwise than in the usual and regular course of
business, or proposal to dissolve, shall require the affirmative vote of the
holders of not less than a majority of all outstanding shares of capital stock
of the corporation entitled to vote generally in the election of directors of
the corporation. At any time when the corporation is subject to the reporting
requirements of Section 13 or Section 15(d) of the Securities Exchange Act of
1934, as amended, pursuant to the authority granted under RCW 23B.10.030, RCW
23B.11.030, RCW 23B.12.020, and RCW 23B.14.020, the vote of shareholders of
this corporation required in order to approve amendments to the Articles of
Incorporation, a plan of merger or share exchange, the sale, lease, exchange,
or other disposition of all or substantially all
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of the property of the corporation not in the usual and regular course of
business, or dissolution of the corporation shall be a majority of all of the
votes entitled to be cast by each voting group, regardless of whether or not
the corporation is a "public company," as that term is defined in Section
23B.01.400 of the Act.
ARTICLE V.
Indemnification and Liability of Officers,
Directors, Employees and Agents.
5.1 Indemnification. The corporation shall indemnify, in the
manner and to the full extent permitted by law, any person (or the estate of
any person) who was or is a party to, or is threatened to be made a party to
any threatened, pending or complete action, suit or proceeding, whether or not
by or in the right of the corporation, and whether civil, criminal,
administrative, investigative or otherwise, by reason of the fact that such
person 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. The corporation may, to the full extent permitted by law,
purchase and maintain insurance on behalf of any such person against any
liability which may be asserted against such person. To the full extent
permitted by law, the indemnification provided herein shall include expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement,
and, in the manner provided by law, any such expenses may be paid by the
corporation in advance of the final disposition of such action, suit or
proceeding. The indemnification provided herein shall not be deemed to limit
the right of the corporation to indemnify any other person for any such
expenses to the full extent permitted by law, nor shall it be deemed exclusive
of any other rights to which any person seeking indemnification from the
corporation may be entitled under any agreement, vote of shareholders or
disinterested directors or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office.
5.2 Limitation on Liability of Directors. No director of the
corporation shall be personally liable to the corporation or its shareholders
for monetary damages for his conduct as a director, except for (i) acts or
omissions that involve intentional misconduct or a knowing violation of law by
the director, (ii) approval of distributions or loans in violation of RCW
23B.08.310, or (iii) any transaction from which the director will personally
receive a benefit in money, property or services to which the director is not
legally entitled. If the Washington Business Corporation Act is hereafter
amended to authorize corporate action further eliminating or limiting the
personal liability of directors, then the liability of a director of the
corporation shall be eliminated or limited to the fullest extent permitted by
the Washington Business Corporation Act, as so amended. Any
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amendment to or repeal of this Article shall not adversely affect any right or
protection of a director of the corporation for or with respect to any acts or
omissions of such director occurring prior to such amendment or repeal.
ARTICLE VI.
Executive Committee
If no Liquidity Event has occurred by May 20, 1998, an executive
committee (the "Executive Committee") shall be formed comprised of then members
of the Board of Directors, excluding (a) management, (b) management designees
and (c) family members or individuals having a business or professional
relationship with the corporation, management or any management designees. The
Executive Committee shall, by majority vote of its members have all he right
and authority of the Board of Directors to manage the sale process of the
corporation, whether by merger, sale of assets or otherwise. The Executive
Committee is not being created as a committee of the Board of Directors but
rather as an independent body pursuant to Section 23B.08.010 of the Washington
Business Corporation Act; accordingly, the Executive Committee shall have
exclusive authority for the matters described in the preceding sentence and the
Board of Directors shall have no authority for such matters.
ARTICLE VII.
Amendment of Articles.
These Articles of Incorporation may be amended with the approval of
each voting group entitled to vote separately thereon by a majority of all
votes entitled to be cast by that voting group. The holders of the outstanding
shares of a class are entitled to vote as a separate voting group on a proposed
amendment to these Articles of Incorporation if the amendment would:
7.1 Increase of decrease the aggregate number of authorized shares
of the class;
7.2 Effect an exchange or reclassification of all or part of the
shares of the class into shares of another class;
7.3 Effect an exchange or reclassification, or crease the right of
exchange, of all or part of the shares of another class into shares of the
class;
7.4 Change the designation, rights, preferences, or limitations of
all or part of the shares of the class;
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7.5 Change the shares of all or part of the class into a different
number of shares of the same class;
7.6 Create a new class of shares having rights or preferences with
respect to distributions or to dissolution that are prior, superior, or
substantially equal to the shares of the class;
7.7 Increase the rights, preferences, or number of authorized
shares of any class that, after giving effect to the amendment, have rights or
preferences with respect to distributions or to dissolution that are prior,
superior, or substantially equal to the shares of the class;
7.8 Limit or deny an existing preemptive right of all or part of
the shares of the class; or
7.9 Cancel or otherwise affect rights to distributions or
dividends that have accumulated but not yet been declared on all or part of the
shares of the class.
ARTICLE VIII.
OTHER MATTERS
8.1 Except as otherwise provided in these Articles, as amended
from time to time, the corporation reserves the right to amend, alter, change
or repeal any provisions contained in these Articles in any manner now or
hereafter prescribed or permitted by statute.
8.2 The corporation shall have authority to correct clerical
errors in any documents filed with the Secretary of State of Washington,
including these Articles or any amendments hereto, without the necessity of
special shareholder approval of such corrections.
DATED: ________________, 1997.
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John M. Hemingway, Chief Financial
Officer and Secretary
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