EXHIBIT 3.1
CERTIFICATE OF INCORPORATION
OF
CALLAWAY GOLF COMPANY
ARTICLE I
NAME OF CORPORATION
The name of this Corporation is Callaway Golf Company.
ARTICLE II
REGISTERED OFFICE
The address of the registered office of the Corporation in the State
of Delaware is 9 East Loockerman Street, in the City of Dover 19901, County of
Kent, and the name of its registered agent at that address is National
Registered Agents, Inc.
ARTICLE III
PURPOSE
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 the State of Delaware (the "GCL").
ARTICLE IV
AUTHORIZED CAPITAL STOCK
SECTION 1. Number of Authorized Shares. The Corporation shall be
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authorized to issue two classes of shares of stock to be designated,
respectively, "Common Stock" and "Preferred Stock." The total number of shares
which the Corporation shall have authority to issue is Two Hundred Forty-Three
million (243,000,000), of which Two Hundred Forty million (240,000,000) shares
shall be common stock having a par value of $0.01 per share (the "Common
Stock"), and Three million (3,000,000) shares shall be preferred stock having a
par value of $0.01 per share (the "Preferred Stock"). Of the authorized shares
of Preferred Stock,
Two Hundred Forty Thousand (240,000) shares shall be designated Series A Junior
Participating Preferred Stock (hereinafter referred to as the "Series A
Preferred Stock").
SECTION 2. Common Stock. The Board of Directors of the Corporation
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(the "Board of Directors") may authorize the issuance of shares of Common Stock
from time to time. Shares of Common Stock that are redeemed, purchased or
otherwise acquired by the Corporation may be reissued except as otherwise
provided by law.
SECTION 3. Preferred Stock. The Board of Directors may authorize the
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issuance of shares of Preferred Stock from time to time in one or more series.
Shares of Preferred Stock that are redeemed, purchased or otherwise acquired by
the Corporation may be reissued except as otherwise provided by law. The Board
of Directors is hereby authorized to fix or alter the designations, powers and
preferences, and relative, participating, optional or other rights, if any, and
qualifications, limitations or restrictions thereof, including without
limitation, dividend rights, (and whether dividends are cumulative), conversion
rights, if any, voting rights (including the number of votes, if any, per share,
as well as the number of members, if any, of the Board of Directors or the
percentage of members, if any, of the Board of Directors each class or series of
Preferred Stock may be entitled to elect), rights and terms of redemption
(including sinking fund provisions, if any), redemption price and liquidation
preferences of any wholly unissued series of Preferred Stock, and the number of
shares constituting any such series and the designation thereof, and to increase
(but not above the total number of authorized shares of the class) or decrease
(but not below the number of shares of such series then outstanding) the number
of shares of any such series subsequent to the issuance of shares of such
series.
The relative rights, preferences, privileges and restrictions granted
to the Series A Preferred Stock are as follows:
A. Dividends and Distributions.
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(i) Subject to the prior and superior rights of the holders of
any shares of any series of Preferred Stock ranking prior and superior to the
shares of Series A Preferred Stock with respect to dividends, the holders of
shares of Series A Preferred Stock shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the 15th day of January, April,
July and October and in each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to, subject to the provision for adjustment hereinafter set forth, 1,000
times the aggregate per share amount of all cash dividends, and 1,000 times the
aggregate per share amount (payable in kind) of all non-cash dividends other
distributions other than a dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock (by reclassification or
otherwise), declared on the Common Stock of the Corporation since the
immediately preceding Quarterly Dividend Payment Date, or, with respect to the
first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series A Preferred Stock. In the event the Corporation
shall at any time after the
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issuance of any shares of Series A Preferred Stock (a) declare any dividend on
Common Stock payable in shares of Common Stock, (b) subdivide the outstanding
Common Stock or (c) combine the outstanding Common Stock into a smaller number
of shares, then in each such case the amount to which holders of shares of
Series A Preferred Stock were entitled immediately prior to such event under the
preceding sentence shall be adjusted by multiplying such amount by a fraction,
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(ii) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (i) above concurrently
with any declaration of a dividend or distribution on the Common Stock (other
than a dividend payable in shares of Common Stock).
(iii) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A
Preferred Stock, unless the date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in which case dividends on
such shares shall begin to accrue from the date of issue of such shares, or
unless the date of issue is a Quarterly Dividend Payment Date or is a date after
the record date for the determination of holders of shares of Series A Preferred
Stock entitled to receive a quarterly dividend and before such Quarterly
Dividend Payment Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the shares of Series
A Preferred Stock in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be no more than 30 days
prior to the date fixed for the payment thereof.
B. Voting Rights. The holders of shares of Series A Preferred Stock
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shall have the following voting rights:
(i) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder thereof
to 1,000 votes on all matters submitted to a vote of the shareholders of the
Corporation. In the event the Corporation shall at any time after the issuance
of any shares of Series A Preferred Stock (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine the outstanding Common Stock into a smaller number of
shares, then in each case the number of votes per share to which holders of
shares of Series A Preferred Stock were entitled immediately prior to such event
shall be adjusted by multiplying such number by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
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(ii) Except as otherwise provided herein or by law, the holders
of shares of Series A Preferred Stock and the holders of shares of Common Stock
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(iii) Except as set forth herein, holders of Series A Preferred
Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of Common
Stock as set forth herein) for taking any corporate action.
C. Certain Restrictions.
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(i) The Corporation shall not declare any dividend on, make any
distribution on, or redeem or purchase or otherwise acquire for consideration
any shares of Common Stock after the first issuance of a share or fraction of a
share of Series A Preferred Stock unless concurrently therewith it shall declare
a dividend on the Series A Preferred Stock as required by subsection A hereof.
(ii) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in subsection
A have been declared but not paid, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of Series A
Preferred Stock outstanding shall have been paid in full, the Corporation shall
not
(a) declare or pay dividends on, make any other
distribution on, or redeem or purchase or otherwise acquire for consideration
any shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock;
(b) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series A Preferred
Stock, except dividends paid ratably on the Series A Preferred Stock and all
such parity stock on which dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such shares are then entitled;
(c) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A Preferred Stock,
provided that the Corporation may at any time redeem, purchase or otherwise
acquire shares of any such parity stock in exchange for shares of any stock of
the Corporation ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series A Preferred Stock;
(d) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a parity
with the Series A Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board of Directors) to
all holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights
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and preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective series or
classes.
(iii) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (i) of
this subsection C, purchase or otherwise acquire such shares at such time and in
such manner.
D. Reacquired Shares. Any shares of Series A Preferred Stock
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purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of Preferred Stock
to be created by resolution or resolutions of the Board of Directors, subject to
the conditions and restrictions on issuance set forth herein.
E. Liquidation, Dissolution or Winding Up.
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(i) Upon any liquidation (voluntary or otherwise), dissolution
or winding up of the Corporation, no distribution shall be made to the holders
of shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock unless, prior
thereto, the holders of shares of Series A Preferred Stock shall have received
$1,000 per share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment (the
"Series A Liquidation Preference"). Following the payment of the full amount of
the Series A Liquidation Preference, no additional distributions shall be made
to the holders of shares of Series A Preferred Stock unless, prior thereto, the
holders of shares of Common Stock shall have received an amount per share (the
"Common Adjustment") equal to the quotient obtained by dividing (a) the Series A
Liquidation Preference by (b) 1,000 (as appropriately adjusted as set forth in
subparagraph (iii) below to reflect such events as stock splits, stock dividends
and recapitalizations with respect to the Common Stock) (the "Adjustment
Number"). Following the payment of the full amount of the Series A Liquidation
Preference and the Common Adjustment in respect of all outstanding shares of
Series A Preferred Stock and Common Stock, respectively, holders of Series A
Preferred Stock and holders of shares of Common Stock shall receive their
ratable and proportionate share of remaining assets to be distributed in the
ratio of the Adjustment Number to one (1) with respect to such Preferred Stock
and Common Stock, on a per share basis, respectively.
(ii) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference and
the liquidation preferences of all other series of Preferred Stock, if any,
which rank on a parity with the Series A Preferred Stock, then such remaining
assets shall be distributed ratably to the holders of such parity shares in
proportion to their respective liquidation preferences. In the event, however,
that there are not sufficient assets available to permit payment in full of the
Common Adjustment, then such remaining assets shall be distributed ratably to
the holders of Common Stock.
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(iii) In the event the Corporation shall at any time after
January 1, 1999 (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the Adjustment Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
F. Consolidation, Merger, etc. In case the Corporation shall enter
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into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series A Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 1,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may
be, into which or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time after January 1, 1999 (i) declare
any dividend on Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock, or (iii) combine the outstanding Common Stock into
a smaller number of shares, then in each such case the amount set forth in the
preceding sentence with respect to the exchange or change of shares of Series A
Preferred Stock shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
G. No Redemption. The shares of Series A Preferred Stock shall not
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be redeemable.
H. Ranking. The Series A Preferred Stock shall rank junior to all
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other series of the Corporation's preferred stock, if any, as to the payment of
dividends and the distribution of assets, unless the terms of any such series
shall provide otherwise.
I. Amendment. The Certificate of Incorporation of the Corporation
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shall not be further amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series A Preferred Stock
so as to affect them adversely without the affirmative vote of the holders of a
majority or more of the outstanding shares of Series A Preferred Stock, voting
separately as a class.
J. Fractional Shares. Series A Preferred Stock may be issued in
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fractions of a share, which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Preferred Stock.
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ARTICLE V
INCORPORATOR
The name and mailing address of the incorporator of the Corporation
are as follows:
Anne Marie Oldham
2285 Rutherford Road
Carlsbad, CA 92008
ARTICLE VI
AMENDMENT OF CORPORATE DOCUMENTS
SECTION 1. Certificate of Incorporation. The Corporation reserves
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the right to alter, amend, repeal or rescind any provision contained in this
Certificate of Incorporation in any manner now or hereafter prescribed by law,
and all rights conferred on stockholders herein are granted subject to this
reservation.
SECTION 2. Bylaws. In furtherance and not in limitation of the
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powers conferred by statute, the Board of Directors is expressly authorized to
make, repeal, alter, amend, and rescind the bylaws of the Corporation.
ARTICLE VII
DIRECTORS
SECTION 1. Number of Directors. The number of directors shall be
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fixed in the manner provided in the bylaws of the Corporation.
SECTION 2. Election of Directors. Elections of Directors need not be
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by written ballot unless the bylaws of the Corporation shall so provide.
ARTICLE VIII
LIMITATION OF DIRECTOR LIABILITY
To the fullest extent permitted by the GCL, as the same exists or may
hereafter be amended (provided that the effect of any such amendment shall be
prospective only) and as interpreted by the courts of the State of Delaware
("Delaware Law"), a director of the Corporation shall not be liable to the
Corporation or its stockholders for monetary damages for breach of his or her
fiduciary duty as a director.
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ARTICLE IX
NONAPPLICABILITY OF SECTION 203
The provisions of Section 203 of the GCL shall not apply to the
Corporation.
ARTICLE X
STOCKHOLDER ACTION BY WRITTEN CONSENT
Any action required to be taken at any annual or special meeting of
stockholders of the Corporation, or any action which may be taken at any annual
or special meeting of such stockholders, may be taken without a meeting, without
prior notice and without a vote, if a consent in writing, setting forth the
action so taken, shall be signed by the holders of outstanding shares having not
less than the minimum number of votes that would be necessary to authorize or
take that action at a meeting at which all shares entitled to vote on that
action were present and voted. In the case of election of directors, such
consent shall be effective only if signed by the holders of all outstanding
shares entitled to vote for the election of directors; provided, however, that a
director may be elected at any time to fill a vacancy on the Board of Directors
(other than a vacancy created by the removal of a director) that has not been
filled by the directors, by the written consent of the holders of a majority of
the outstanding shares entitled to vote for the election of directors. Prompt
notice of the taking of the corporate action without a meeting by less than
unanimous written consent shall be given to those stockholders who have not
consented in writing.
ARTICLE XI
CUMULATIVE VOTING
Each holder of stock entitled to vote for the election of directors
shall be entitled to as many votes as shall equal the number of votes which such
stockholder would be entitled (but for the provisions of this Article) to cast
for the election of directors with respect to such stockholder's shares of stock
multiplied by the number of directors to be elected, and such holder may cast
all of such votes for a single director or for any two or more directors as such
stockholder may see fit.
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The undersigned incorporator hereby acknowledges that the foregoing
Certificate of Incorporation is his act and deed.
Dated:
/s/ Anne Marie Oldham
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Anne Marie Oldham, Incorporator
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