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Exhibit 3.4
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ACCELGRAPHICS GRAPHICS, INC.
The following Amended and Restated Certificate of Incorporation of
AccelGraphics, Inc. amends and restates the provisions of and supersedes the
Certificate of Incorporation filed with the Secretary of State of the State of
Delaware on January 28, 1997 in its entirety.
ARTICLE I
The name of the corporation is AccelGraphics, Inc. (the "Corporation").
ARTICLE II
The address of the corporation's registered office in the State of
Delaware is Corporation Service Company, 1013 Centre Road, Wilmington, Delaware
19805. 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 General Corporation Law of
Delaware.
ARTICLE IV
Upon the effective date of the filing of the Amended and Restated
Certificate of Incorporation, every two shares of this Corporation's
outstanding Common Stock and Preferred Stock shall be converted and
reconstituted into one share of the like class and series of the Corporation's
capital stock from which such shares were converted (the "Stock Split"). In
lieu of the issuance of fractional shares, the Corporation shall pay to the
holder thereof in cash an amount equal to the fraction of a share to which such
holder is entitled multipled by the fair market value of such share, as
determined by the Corporation's Board of Directors. All share amounts and
amounts per share set forth in the Amended and Restated Certificate of
Incorporation have been appropriately adjusted to reflect the Stock Split. No
further adjustment of any Dividend Preference, Liquidation Preference,
Conversion Price, Redemption Price, or Protective Provisions pursuant to
Sections 1, 2, 3, 4, or 6 respectively, of Part B of this Article IV shall be
made as a result of the Stock Split.
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(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 Sixty Million (60,000,000) shares. The number of shares of Common
Stock authorized to be issued is Fifty Million (50,000,000), par value $.001
per share, and the number of shares of Preferred Stock authorized to be issued
is Ten Million (10,000,000), par value $.001 per share.
(B) Rights, Preferences, Privileges and Restrictions of Preferred
Stock. The Preferred Stock authorized by this Certificate of Incorporation may
be issued from time to time in series. The rights, preferences, privileges and
restrictions granted to and imposed on the Series A Preferred Stock, which
series shall consist of Three Million Four Hundred Seventy-Seven Thousand
(3,477,000) shares, the Series A-1 Preferred Stock, which series shall consist
of Three Million Four Hundred Seventy-Seven Thousand (3,477,000) shares, the
Series B Preferred Stock, which series shall consist of One Million One Hundred
Thousand (1,100,000) shares, and the Series B-1 Preferred Stock, which series
shall consist of One Million One Hundred Thousand (1,100,000) shares are as set
forth below in this Part (B) of Article IV.
Except as to the Series A, Series A-1, Series B and Series B-1
Preferred Stock and except as otherwise provided in this Certificate of
Incorporation, the Board of Directors is hereby authorized to fix or alter the
rights, preferences, privileges and restrictions granted to or imposed upon any
wholly unissued additional series of Preferred Stock, and the number of shares
constituting any such series and the designation thereof, or any of them. The
Board of Directors, except as otherwise provided in this Certificate of
Incorporation, is also authorized to decrease the number of shares of any
series, subsequent to the issuance of shares of that series, but not below the
number of shares of such series then outstanding. In case the number of shares
of any series shall be so decreased, the shares constituting such decrease
shall resume the status which they had prior to the adoption of the resolution
originally fixing the number of shares of such series.
1. Dividend Provisions. The holders of shares of Series
A, Series A-1, Series B, and Series B-1 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 $0.16666667 per share for each share of Series A and Series A-1 Preferred
Stock, and $0.30 per share for each share of Series B and Series B-1 Preferred
Stock, (adjusted to reflect subsequent stock dividends, stock splits or
recapitalizations) per annum or, if greater (as determined on an as-converted
basis), an amount equal to that paid on any other outstanding shares of the
Corporation whenever funds are legally available therefor, payable quarterly
when, as and if declared by the Board of Directors. Such dividends shall not
be cumulative.
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2. Liquidation Preference.
(a) In the event of any liquidation, dissolution
or winding up of the Corporation, either voluntary or involuntary, the holders
of the Series A, Series A-1, Series B, and Series B-1 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 $1.66666667 for each outstanding
share of Series A and Series A-1 Preferred Stock, respectively, (as adjusted for
stock splits, stock dividends and recapitalizations ) (the "Original Series A
and Series A-1 Issue Price"), and $3.00 for each outstanding share of Series B
and Series B-1 Preferred Stock ( as adjusted for stock splits, stock dividends
and recapitalizations) (the "Original Series B and Series B-1 Issue Price"),
plus an amount equal to declared but unpaid dividends thereon. If, upon the
occurrence of such an event, the assets and property thus distributed among the
holders of the Series A, Series A-1, Series B and Series B-1 Preferred Stock
shall be insufficient to permit the payment to such holders of the full
preferential amount, then the assets and property of the Corporation legally
available for distribution shall be distributed ratably among the holders of the
Series A, Series A-1, Series B and Series B-1 Preferred Stock in proportion to
the aggregate preferential amounts owed such holders upon a liquidation,
dissolution or winding up of the Corporation.
(b) After the distributions described in
subsections (a) above have been paid in full, the remaining assets of the
Corporation available for distribution to stockholders shall be distributed
among the holders of Series A, Series A-1, Series B, and Series B-1 Preferred
Stock and Common Stock pro rata based on the number of shares of Common Stock
held by each (assuming conversion of all such Preferred Stock).
(c) For purposes of this Section 2, (i) any
acquisition of the Corporation by means of merger or other form of corporate
reorganization in which the stockholders of the Corporation do not own a
majority of the outstanding shares of the surviving corporation or (ii) a sale
of all or substantially all of the assets of the Corporation shall be treated
as a liquidation, dissolution or winding up of the Corporation and shall
entitle the holders of Preferred Stock and Common Stock to receive at the
closing cash, securities or other property as specified in Sections 2(a) and
2(b) above; provided that in connection with the distribution of assets
contemplated by this subsection (c) the holders of Series A and Series A-1
Preferred Stock only shall be entitled to receive a total of $6.66666667 per
share (which amount includes the Original Series A and Series A-1 Issue Price)
and the holders of Series B and Series B-1 Preferred Stock only shall be
entitled to receive a total of $12.00 per share (which amount includes the
Original Series B and Series B-1 Issue Price), and if there are any remaining
proceeds such remaining proceeds shall be distributed, among the holders of
Common Stock pro rata based on the number of shares of Common Stock held by
each such stockholder.
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(d) Any securities to be delivered to the holders
of the Preferred Stock and/or Common Stock pursuant to Section 2(c) above shall
be valued as follows:
(i) Securities not subject to investment
letter or other similar restrictions on free marketability:
(A) If traded on a national
securities exchange or the Nasdaq Stock Market, the value shall be deemed to be
the average of the closing prices of the securities on such exchange over the
30-day period ending three (3) days prior to the closing;
(B) If actively traded
over-the-counter, the value shall be deemed to be the average of the closing
bid prices over the 30-day period ending three (3) days prior to the closing;
and
(C) If there is no active public
market, the value shall be the fair market value thereof, as determined in good
faith by the Board of Directors of the Corporation.
(ii) The method of valuation of
securities subject to investment letter or other restrictions on free
marketability shall be to make an appropriate discount from the market value
determined as above in (i)(A), (B) or (C) to reflect the approximate fair
market value thereof, as determined in good faith by the Board of Directors of
the Corporation.
(e) In the event the requirements of subsection
2(c) are not complied with, the Corporation shall forthwith either:
(i) cause such closing to be postponed
until such time as the requirements of Section 2(c) have been complied with, or
(ii) cancel such transaction, in which
event the rights, preferences, privileges and restrictions of the holders of
Preferred Stock shall revert to and be the same as such rights, preferences,
privileges and restrictions existing immediately prior to the date of the first
notice referred to in Section 2(f) hereof.
(f) The Corporation shall give each holder of
record of Preferred Stock written notice of such a Section 2(c) transaction not
later than ten (10) days prior to the stockholders' meeting called to approve
such transaction, or 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
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
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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 a majority of the Series A, Series A-1, Series B and
Series B-1 Preferred Stock then outstanding.
3. Conversion. The holders of the Series A, Series A-1,
Series B and Series B-1 Preferred Stock shall have conversion rights as follows
(the "Conversion Rights"):
(a) Right to Convert. Each share of Series A,
Series A-1, Series Band Series B-1 Preferred Stock shall be convertible, at the
option of the holder thereof, at any time after the date of issuance of such
share, at the office of the Corporation or any transfer agent for the Series A,
Series A-1, Series B, and Series B-1 Preferred Stock, into such number of fully
paid and nonassessable shares of Common Stock as is determined by dividing
$1.66666667 for each share of Series A and Series A-1 Preferred Stock, $3.00
for each share of Series B and Series B-1 Preferred Stock by the Conversion
Price at the time in effect for such shares. The initial "Conversion Price"
for each share of Series A and Series A-1 Preferred Stock shall be $1.66666667
per share, for each share of Series B and Series B-1 Preferred Stock shall be
$3.00 per share; provided, however, in either case, that such Conversion Prices
shall be subject to adjustment as set forth below.
(b) Automatic Conversion.
(i) Each share of Series A, Series A-1,
Series B, and Series B-1 Preferred Stock shall automatically be converted into
shares of Common Stock at the Conversion Price at the time in effect for such
series of Preferred Stock immediately upon the consummation of the
Corporation's sale of its Common Stock in a bona fide, firm commitment
underwriting pursuant to a registration statement on Form S-1 under the
Securities Act of 1933, as amended, which results in aggregate gross cash
proceeds to the Corporation in excess of $7,500,000 and the public offering
price of which is not less than $7.00 per share (adjusted to reflect subsequent
stock dividends, stock splits or recapitalization).
(ii) Conversion Into Series A-1 and Series
B-1 Preferred.
(A) Each share of Series A
Preferred Stock held by a Non-Participating Investor who does not purchase such
holder's full Pro Rata Share of New Securities in a Series A Dilutive Issuance,
in accordance with the procedures set forth in Section 3(b)(ii)(C) hereof,
shall automatically be converted into a share of Series A-1 Preferred Stock at
a conversion rate of one fully paid and nonassessable share of Series A-1
Preferred Stock for each share of Series A Preferred Stock held by such
holder. Each share of Series B Preferred Stock held by a Non-Participating
Investor who does not purchase such holder's full Pro Rata Share of New
Securities in a Series B Dilutive Issuance, in accordance with the procedures
set forth in Section 3(b)(ii)(C)
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hereof, shall automatically be converted into a share of Series B-1 Preferred
Stock at a conversion rate of one fully paid and nonassessable share of Series
B-1 Preferred Stock for each share of Series B Preferred Stock held by such
holder.
(B) For purposes of this Section 3(b)(ii),
the following definitions shall apply:
(1) "New Securities" shall mean
any Additional Stock of Common Stock, as such term is defined in Section
3(d)(ii) below, sold in any financing transaction after the Initial Purchase
Date (as defined in Section 3(d)(i)(A) below).
(2) "Pro Rata Share" shall mean
the ratio of (X) the sum of the number of shares of Common Stock issuable upon
the conversion of the particular series of Preferred Stock held by a holder of
such series of Preferred Stock to (Y) the sum of the total number of shares of
Common Stock outstanding (assuming conversion of all of the outstanding shares
of Preferred Stock of the Corporation).
(3) "Participating Investor" shall
mean any holder of Series A Preferred Stock that agrees to purchase at least
its Pro Rata Share of a Series A Dilutive Issuance or a holder of Series B
Preferred Stock that agrees to purchase at least its Pro Rata share of a Series
B Dilutive Issuance, in each case pursuant to Section 3(b)(ii)(C) hereof.
(4) "Non-Participating Investor"
shall mean any holder of Series A Preferred Stock or Series B Preferred Stock
that is not a Participating Investor.
(5) "Series A Dilutive Issuance"
shall mean an issuance of New Securities for a consideration per share less
than the Conversion Price of the Series A Preferred Stock in effect on the date
of and immediately prior to such issue.
(6) "Series B Dilutive Issuance"
shall mean an issuance of New Securities for a consideration per share less
than the Conversion Price of the Series B Preferred Stock in effect on the date
of and immediately prior to such issue.
(C) In the event that the Corporation
shall propose to undertake a Series A Dilutive Issuance or Series B Dilutive
Issuance, it shall give each holder of the particular series of Preferred Stock,
as appropriate, a written notice (the "Pay- to-Play Notice") of its intention to
sell New Securities at least thirty (30) days prior to the anticipated date of
first sale of such New Securities (the "New Securities Closing Date"). The
Pay-to-Play Notice shall describe the type of New Securities, the price of such
New Securities and the general terms upon which the Corporation proposes
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to issue such New Securities. Each holder of such series of Preferred Stock
shall have a right to purchase its Pro Rata Share of such New Securities (a
"Purchase Right"), which Purchase Right shall expire fifteen (15) days prior to
the New Securities Closing Date. Each holder of such series of Preferred Stock
shall be entitled to exercise its Purchase Right by providing written notice to
the Corporation that such holder agrees to become a Participating Investor in
accordance with the terms specified in the Pay-to-Play Notice. Any holder of
the particular series of Preferred Stock (in the event of a Series A Dilutive
Issuance or Series B Dilutive Issuance, as appropriate) who fails to provide
such written notice to the Corporation prior to the expiration of such holder's
Purchase Right shall be deemed to be a Non-Participating Investor.
(D) Upon the conversion of Series A
or Series B Preferred Stock into Series A-1 or Series B-1 Preferred Stock held
by a Non-Participating Investor as set forth herein, such shares of Series A or
Series B Preferred Stock shall no longer be outstanding on the books of the
Corporation and the Non-Participating Investor shall be treated for all
purposes as the record holder of shares of Series A-1 Preferred Stock or Series
B-1 Preferred Stock, as appropriate, as of the date of closing of the
applicable Series A Dilutive Issuance or Series B Dilutive Issuance.
(c) Mechanics of Conversion. Before any holder
of Series A, Series A -1, Series B, and Series B-1 Preferred Stock shall be
entitled to convert the same into shares of Common Stock, such holder 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 by mail, postage prepaid, 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 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 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 offer of securities registered pursuant to the
Securities Act of 1933, as amended, the conversion will be conditioned upon the
closing with the underwriter of the sale of securities pursuant to such
offering, unless otherwise designated in writing by the holders of such
Preferred Stock, in which event the person(s) entitled to receive the Common
Stock issuable upon such conversion of the Preferred Stock shall not be deemed
to have converted such Preferred Stock until immediately prior to the closing
of such sale of securities.
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(d) Conversion Price Adjustments of Preferred
Stock.
(i) (A) If the Corporation, at any
time or from time to time after the date of the first issuance of Series A
Preferred Stock (the "Series A Initial Purchase Date"), the first issuance of
Series B Preferred Stock (the "Series B Initial Purchase Date"), shall issue
any Additional Stock (as defined below) without consideration or for a
consideration per share less than the Conversion Price for the Series A
Preferred Stock or Series B Preferred Stock in effect immediately prior to the
issuance of such Additional Stock, the Conversion Price for the Series A and/or
the Series B Preferred Stock in effect immediately prior to each such issuance
shall forthwith be adjusted to a price determined by multiplying such
Conversion Price by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such issuance plus the
number of shares of Common Stock which the aggregate consideration received by
the Corporation for the total number of shares of Additional Stock so issued
would purchase at such Conversion Price, and the denominator of which shall be
the number of shares of Common Stock outstanding immediately prior to such
issuance plus the number of such shares of Additional Stock so issued; provided
that for the purposes of this subsection, all shares of Common Stock issuable
upon conversion of outstanding Preferred Stock shall be deemed to be
outstanding, and immediately after any Additional Stock is deemed issued, such
Additional Stock shall be deemed to be outstanding.
(B) No adjustment of the Conversion
Price for the Series A or Series B 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. Except to the
limited extent provided for in subsections 3(d)(i)(E)(3) and 3(d)(i)(E)(4)
below, no adjustment of such Conversion Price pursuant to this subsection
3(d)(i) shall have the effect of increasing the Conversion Price above the
Conversion Price in effect immediately prior to such adjustment.
(C) 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.
(D) In the case of the issuance of
the 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) In the case of the issuance, whether
before, on or after the Series A Initial Purchase Date or the Series B Initial
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 (which are not excluded from the definition of Additional Stock), the
following provisions shall apply:
(1) The aggregate maximum number
of shares of Common Stock deliverable upon exercise 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 subsections 3(d)(i)(C)
and 3(d)(i)(D) above), if any, received by the Corporation upon the issuance of
such options or rights plus the minimum purchase price provided in such options
or rights for the Common Stock covered thereby.
(2) The aggregate maximum number
of shares of Common Stock deliverable upon conversion of or in exchange 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 additional consideration, if any, to be received by the
Corporation 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 subsections 3(d)(i)(C) and 3(d)(i)(D)
above).
(3) In the event of any change in
the number of shares of Common Stock deliverable or any increase 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 Conversion Price of the Series A or Series
B Preferred Stock obtained with respect to the adjustment which was made upon
the issuance of such options, rights or securities, and any subsequent
adjustments based thereon, 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.
(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 Conversion Price of the Series A or Series B
Preferred Stock obtained with respect to
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the adjustment which was made upon the issuance of such options, rights or
securities or options or rights related to such securities, and any subsequent
adjustments based thereon, shall be recomputed to reflect the issuance of only
the number of shares of Common Stock 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. 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, only the number of shares of Common
Stock 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 shall continue to be deemed to be issued.
(5) All Common Stock deemed
issued pursuant to this subsection 3(d)(i)(E) shall be considered issued only at
the time of its deemed issuance and any actual issuance of such stock shall not
be an actual issuance or a deemed issuance of the Corporation's Common Stock
under the provisions of this Section 3.
(F) No adjustment of the Conversion
Price for the Series A-1 or Series B-1 Preferred Stock shall be made upon the
issuance of any Additional Stock without consideration or for consideration per
share less than the Conversion Price of the Series A-1 or Series B-1 Preferred
Stock in effect immediately prior to the issuance of such Additional Stock.
(ii) "Additional Stock" shall mean any
shares of Common Stock issued (or deemed to have been issued pursuant to
subsection 3(d)(i)(E)) by the Corporation on or after the Series A Initial
Purchase Date or Series B Initial Purchase Date Initial Purchase Date other
than shares of Common Stock issued or issuable
(A) pursuant to a transaction
described in subsection 3(d)(iii) below,
(B) up to 3,3000,000 shares of
Common Stock (as adjusted for stock splits, stock dividends and
recapitalizations) to officers, directors, employees and consultants of the
Corporation directly or pursuant to benefit plans approved by the stockholders
and directors of the Corporation,
(C) in connection with capital
equipment leases, commercial debt financing, technology acquisitions and other
comparable transactions approved by the Board of Directors, or
(D) upon conversion of the Series
A, Series A-1, Series B or Series B-1 Preferred Stock.
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(iii) In the event the Corporation should
at any time or from time to time after the Series A Initial Purchase Date or
Series B Initial Purchase Date 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 Conversion Price of each series of Series A, Series A-1, Series B and
Series B-1 Preferred Stock 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 outstanding shares
determined in accordance with subsection 3(d)(i)(E).
(iv) If the number of shares of Common
Stock outstanding at any time after the Series A Initial Purchase Date or
Series B Initial Purchase Date is decreased by a combination of the
outstanding shares of Common Stock, then, following the record date of such
combination, the Conversion Price for each series of Series A, Series A-1,
Series B and Series B-1 Preferred Stock 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.
(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
subsection 3(d)(iii), then, in each such case for the purpose of this
subsection 3(e), the holders of Series A, Series A-1, Series B and Series B-1
Preferred Stock shall be entitled to a proportionate 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 Series A, Series A-1,
Series B and Series B-1 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 Section 2 or this Section 3) provision shall be made so that the
holders of each series of Series A, Series A-1, Series B and Series B-1
Preferred Stock shall thereafter be entitled to receive upon conversion of such
series of Series A, Series A-1, Series B and Series B-1 Preferred Stock the
number of shares of stock or other securities or property of the Company or
otherwise, to which a holder of Common Stock deliverable upon conversion would
have been entitled
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on such recapitalization. In any such case, appropriate adjustment shall be
made in the application of the provisions of this Section 3 with respect to the
rights of the holders of each series of Series A, Series A-1, Series B and
Series B-1 Preferred Stock after the recapitalization to the end that the
provisions of this Section 3 (including adjustment of the Conversion Price then
in effect and the number of shares purchasable upon conversion of such series
of Series A, Series A-1, Series B, and Series B-1 Preferred Stock) shall be
applicable after that event as nearly equivalent as may be 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 3 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 each series of Series A, Series A-1, Series
B and Series B-1 Preferred Stock against impairment.
(h) No Fractional Shares and Certificate as to
Adjustments.
(i) No fractional shares shall be issued
upon conversion of the Preferred Stock, and the number of shares of Common
Stock to be issued shall be rounded to the nearest whole share. Whether or not
fractional shares are issuable upon such conversion shall be determined on the
basis of the total number of shares of 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 any Conversion Price of any series of Preferred
Stock pursuant to this Section 3, 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 series of 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
Preferred Stock, furnish or cause to be furnished to such holder a like
certificate setting forth (A) such adjustment and readjustment, (B) the
Conversion Price 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 such series of Preferred Stock.
(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
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any other right, the Corporation shall mail to each holder of Preferred Stock,
at least 20 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 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 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 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.
The Corporation shall at all times reserve
and keep available out of its authorized but unissued shares of Series A-1 and
Series B-1 Preferred Stock solely for the purpose of effecting the conversion
of the shares of Series A and Series B Preferred Stock, respectively, such
number of its shares of Series A-1 and Series B-1 Preferred Stock as shall from
time to time be sufficient to effect the conversion of all outstanding shares
of Series A and Series B Preferred Stock; and if at any time the number of
authorized but unissued shares of Series A-1 and Series B-1 Preferred Stock
shall not be sufficient to effect the conversion of all then outstanding shares
of such Series A and Series B Preferred Stock, respectively, in addition to
such other remedies as shall be available to the holder of such Series A and/or
Series B 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 Series A-1 and/or Series B-1 Preferred Stock to such number
of shares as shall be sufficient for such purposes.
(k) Notices. Any notice required by the
provisions of this Section 3 to be given to the holders of shares of 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.
4. Redemption Rights.
(a) Redemption. On or at any time after the
sixth anniversary of the Series A Initial Purchase Date for the Series A or
Series A-1 Preferred Stock or the Series B Initial Purchase Date for the Series
B or Series B-1 Preferred Stock the Corporation may redeem all or a portion of
the then outstanding shares of each series of Preferred Stock at the Original
Series A and Series A-1 Issue Price plus declared and unpaid dividends, the
Original Series B and Series B-1 Issue Price plus declared and
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unpaid dividends, respectively, (the "Redemption Price"). In the event the
Corporation determines to redeem a portion of the outstanding shares of a
particular series of Preferred Stock, the Corporation shall effect such
redemption pro rata according to the number of shares held by each holder
thereof. In addition, on or at any time after the sixth anniversary of the
Series A Initial Purchase Date for the Series A or Series A-1 Preferred Stock
or on or after the sixth anniversary of the Series B Initial Purchase Date for
the Series B or Series B-1 Preferred Stock at the option of and upon the
written request of the holders of not less than sixty percent (60%) of the
respective series of Preferred Stock then outstanding and at such dates as such
holders may so elect (the "Redemption Date"), the Corporation shall redeem
one-third of the outstanding shares of the respective series of Preferred Stock
that are requested to be redeemed (or any lesser percentage as such holders
shall elect) per year until all of such shares of Preferred Stock that are
requested to be redeemed are redeemed by paying therefor in cash the Redemption
Price. In the event that the Corporation is unable on any Redemption Date to
effect the redemption of all such series of Preferred Stock for which
redemption is so requested pursuant to this Section 4(a), the Corporation shall
effect such redemption pro rata according to the number of shares held by each
requesting holder thereof. Notwithstanding the foregoing, however, holders of
each series of Preferred Stock shall be entitled to request redemption only one
time per calendar year.
(b) Notice for Company Initiated Redemption.
With respect to a redemption of Preferred Stock initiated by the Corporation,
at least 30 days' previous written notice by certified or registered mail,
postage prepaid, shall be given to the holders of record of the Preferred Stock
to be redeemed, such notice to be addressed to each such stockholder at the
address of such holder given to the Corporation for the purpose of notice, or
if no such address appears or is so given, at the place where the principal
office of the Corporation is located. Such notice shall state the Redemption
Date, the Redemption Price, the then current Conversion Rate and the date of
termination of the right to convert (which date shall not be earlier than
thirty (30) days and not later than sixty (60) days after the above written
notice by mail has been given) and shall call upon such holder to surrender to
the Corporation on said date at the place designated in the notice such
holder's certificate or certificates representing the shares to be redeemed.
On or after the Redemption Date stated in such notice, the holder of each share
of Preferred Stock called for redemption shall surrender the certificate
evidencing such shares to the Corporation at the place designated in such
notice and shall thereupon be entitled to receive payment of the Redemption
Price for the series of Preferred Stock surrendered. If less than all the
shares represented by any such surrendered certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares. If such notice
of redemption shall have been duly given, and if on the Redemption Date funds
necessary for the redemption shall be available therefor, then, as to any
certificates evidencing any Preferred Stock so called for redemption and not
surrendered, all rights of the holders of such shares so called for redemption
and not surrendered shall cease with respect to such shares, except only the
right of the holders to receive the Redemption Price for such series of
Preferred Stock which they hold, without interest, upon surrender of their
certificates therefor.
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(c) Notice for Holder Initiated Redemption.
(i) With respect to a redemption
initiated by the holders of Preferred Stock, at least 30 but no more than 60
days prior to the Redemption Date of the Series A, Series A-1, Series B and
Series B-1 Preferred Stock, written notice shall be mailed, 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 the Series A, Series A-1,
Series B, or Series B-1 to be redeemed, at the address last shown on the
records of the Corporation for such holder or given by the holder to the
Corporation for the purpose of notice, notifying such holder of the redemption
to be effected, specifying the number of shares to be redeemed from such
holder, the Redemption Date, the Redemption Price, the place at which payment
may be obtained and the date on which such holder's Conversion Rights (as
previously defined) as to such shares terminate and calling upon such holder to
surrender to the Corporation, in the manner and at the place designated, the
certificate or certificates representing the shares to be redeemed (the
"Redemption Notice"). Except as provided in Section (4)(c)(ii) below, on or
after the Redemption Date, each holder of Series A, Series A-1, Series B or
Series B-1 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. In the event less than all the
shares represented by any such certificate are redeemed, a new certificate
shall be issued representing the unredeemed shares.
(ii) From and after the Redemption Date,
unless there shall have been a default in payment of the Redemption Price, all
dividends on the Series A, Series A-1, Series B, or Series B-1 Preferred Stock
designated for redemption in the Redemption Notice shall cease to accrue, all
rights of the holders of such shares (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. If the funds of the Corporation
legally available for redemption of shares of Series A, Series A-1, Series B,
and Series B-1 Preferred Stock on any Redemption Date are insufficient to
redeem the total number of shares of Series A, Series A-1, Series B or Series
B-1 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 in
accordance with the provisions of Section (6)(c) hereof. The shares of Series
A, Series A-1, Series B and Series B-1 Preferred Stock not redeemed shall
remain outstanding and entitled to all the rights and preferences provided
herein. At any time thereafter when additional funds of the Company are
legally available for the redemption of shares of Series A, Series A-1,
Series B and Series B-1 Preferred Stock, such funds will immediately be used to
redeem the balance of the shares which the Company has become obligated to
redeem on any Redemption Date but which it has not redeemed.
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(d) Trust Fund. On or prior to any Redemption
Date, the Corporation shall deposit, with any bank or trust company in the
State of Delaware, as a trust fund, a sum sufficient to redeem, on the
Redemption Date thereof, the shares called for redemption, with irrevocable
instructions and authority to the bank or trust company to give the notice of
redemption thereof (or to complete the giving of such notice if theretofore
commenced) and to pay, on or after the Redemption Date or prior hereto, the
Redemption Price of the shares to their respective holders upon the surrender
of their share certificates, then from and after the date of the deposit
(although prior to the Redemption Date), the shares so called shall be
redeemed. The deposit shall constitute full payment of the shares to their
holders and from and after the date of the deposit the shares shall no longer
be outstanding, and the holders thereof shall cease to be stockholders with
respect to such shares, and shall have no rights with respect thereto except
the right to notice pursuant to paragraph (b) above and to receive from the
bank or trust company payment of the Redemption Price for the Preferred Stock
which they hold, without interest, upon the surrender of their certificates
therefor and the right to convert said shares as provided herein at any time up
to but not after the close of business on the fifth day prior to the Redemption
Date of such shares (which date will not be earlier than thirty (30) days after
the written notice of redemption has been mailed to holders of record of the
Preferred Stock called for redemption). Any monies so deposited on account of
the Redemption Price of Preferred Stock converted subsequent to the making of
such deposit shall be repaid to the Corporation forthwith upon the conversion
of such Preferred Stock. Any interest accrued on any funds so deposited shall
be the property of, and paid to, the Corporation. If the holders of Preferred
Stock so called for redemption shall not, at the end of six (6) years from the
Redemption Date thereof, have claimed any funds so deposited, such bank or
trust company shall thereupon pay over to the Corporation such unclaimed funds,
and such bank or trust company shall thereafter be relieved of all
responsibility in respect thereof to such holders and such holders shall look
only to the Corporation for payment of the Redemption Price for the Preferred
Stock which they hold.
5. Voting Rights. The holder of each share of Preferred
Stock shall have the right to one vote for each share of Common Stock into
which such Preferred Stock could then be converted (with any fractional share
determined on an aggregate conversion basis being rounded to the nearest whole
share), 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.
6. Protective Provisions. So long as at least 450,000
shares of Series A, Series A-1, Series B, and Series B-1 Preferred Stock (as
adjusted for stock splits, stock dividends or recapitalizations) are
outstanding and have not been converted into Common Stock, 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
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outstanding shares of Preferred Stock, voting together as one class except
where otherwise required by law:
(a) amend or repeal any provision of the
Corporation's Certificate of Incorporation or Bylaws if such action would alter
or change the designations, preferences and relative, participating, optional
and other special rights, or the restrictions provided for the benefit of the
Preferred Stock;
(b) authorize a merger, sale of all or
substantially all the assets, consolidation, recapitalization or reorganization
of the Corporation;
(c) authorize or issue shares of any class of
stock having a preference over, or being on a parity with, the Preferred Stock
with respect to dividends or assets;
(d) pay or declare any dividend on shares of
Common Stock if current dividends on Preferred remain unpaid, except dividends
solely in Common Stock; or
(e) any repurchase or other acquisition by the
Corporation of its own shares.
7. Status of Converted Stock. In the event any shares
of Preferred Stock shall be converted pursuant to Section 3 hereof or redeemed
pursuant to Section 4 hereof, the shares so converted or redeemed shall be
canceled and shall not be issuable by the Corporation, and 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 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 Part (B) of this Article IV.
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
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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.
ARTICLE V
The Board of Directors of the corporation is expressly authorized to make,
alter or repeal Bylaws of the corporation, but the stockholders may make
additional Bylaws and may alter or repeal any Bylaw whether adopted by them or
otherwise.
ARTICLE VI
Elections of directors need not be by written ballot unless otherwise
provided in the Bylaws of 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,
officer or employee of the corporation or any predecessor of the corporation,
or serves or served at any other enterprise as a director, officer or employee
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 this 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 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
The corporation is to have perpetual existence.
ARTICLE IX
The number of directors which will constitute the whole Board of Directors
of the corporation shall be designated in the Bylaws of the corporation.
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ARTICLE X
Meetings of stockholders may be held within or without the State of Delaware,
as the Bylaws may provide. The books of the corporation may be kept (subject
to any statutory provision) outside the State of Delaware at such place or
places as may be designated from time to time by the Board of Directors in the
Bylaws of the corporation.
ARTICLE XI
"Exempt from Section 2115 of the California Corporations Code" as used
in this Amended and Restated Certificate of Incorporation shall mean such time
when the corporation has outstanding securities listed on the New York Stock
Exchange or the American Stock Exchange or has outstanding securities
designated as qualified for trading as a national market security on the
National Association of Securities Dealers Automatic Quotation System (or such
successor national market system) and when the corporation has at least 800
holders of its equity securities. For the management of the business and for
the conduct of the affairs of the corporation, and in further definition,
limitation and regulation of the powers of the corporation, its directors and
its stockholders or any class thereof, as the case may be, it is further
provided that, effective on the record date of the first Annual Meeting of
Stockholders when the Company is Exempt from Section 2115 of the California
Corporations Code:
(A) The Board of Directors of the corporation shall
divide the directors into three classes, as nearly equal in number as
reasonably possible with the term of office of the first class to expire at the
1998 annual meeting of stockholders or any special meeting in lieu thereof (or
the next consecutive annual meeting of stockholders when the Company is Exempt
from Section 2115 of the California Corporations Code), the term of office of
the second class to expire at the 1999 annual meeting of stockholders or any
special meeting in lieu thereof (or the next consecutive annual meeting of
stockholders when the Company is Exempt from Section 2115 of the California
Corporations Code) and the term of office of the third class to expire at the
2000 annual meeting of stockholders or any special meeting in lieu thereof (or
the next consecutive annual meeting of stockholders when the Company is Exempt
from Section 2115 of the California Corporations Code). At each annual meeting
of stockholders or special meeting in lieu thereof following such initial
classification, directors elected to succeed those directors whose terms expire
shall be elected for a term of office to expire at the third succeeding annual
meeting of stockholders or special meeting in lieu thereof after their election
and until their successors are duly elected and qualified.
(B) Subject to the rights of the holders of any series of
Preferred Stock then outstanding, newly created directorships resulting from any
increase in the authorized number of directors or any vacancies in the Board of
Directors resulting from death, resignation, retirement, disqualification,
removal from office or other cause may be filled only by a majority vote of the
directors then in office even though less than a quorum, or by a sole remaining
director. In the event of any increase or decrease in the
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authorized number of directors, (i) each director then serving as such shall
nevertheless continue as a director of the class of which he or she is a member
until the expiration of his or her current term or his or her prior death,
retirement, removal or resignation and (ii) the newly created or eliminated
directorships resulting from such increase or decrease shall if reasonably
possible be apportioned by the Board of Directors among the three classes of
directors so as to ensure that no one class has more than one director more
than any other class. To the extent reasonably possible, consistent with the
foregoing rule, any newly created directorships shall be added to those classes
whose terms of office are to expire at the latest dates following such
allocation and newly eliminated directorships shall be subtracted from those
classes whose terms of office are to expire at the earliest dates following
such allocation, unless otherwise provided for from time to time by resolution
adopted by a majority of the directors then in office, although less than a
quorum. In the event of a vacancy in the Board of Directors, the remaining
directors, except as otherwise provided by law, may exercise the powers of the
full Board of Directors until the vacancy is filled. Notwithstanding the
foregoing provisions of this Article XI, each director shall serve until his or
her successor is duly elected and qualified or until his or her death,
resignation, or removal. No decrease in the number of directors constituting
the Board of Directors shall shorten the term of any incumbent director.
(C) There shall be no right with respect to shares of stock of the
corporation to cumulate votes in the election of directors.
The foregoing Amended and Restated Certificate of Incorporation has
been duly adopted by the stockholders of the corporation in accordance with the
provisions of Sections 242 and 245 of the General Corporate Law of the State of
Delaware, as amended.
Signature Page Follows
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IN WITNESS WHEREOF, the undersigned have executed this certificate on
March ___, 1997.
________________________________________
Jeffrey W. Dunn, President and Chief
Executive Officer
________________________________________
Michael W. Hall, Secretary
The undersigned certify under penalty of perjury that they have read
the foregoing Amended and Restated Certificate of Incorporation and know the
contents thereof, and that the statements therein are true.
Executed at San Jose, California on March ___, 1997.
_______________________________________
Jeffrey W. Dunn, President and
Chief Executive Officer
_______________________________________
Michael W. Hall, Secretary
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