ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
MERIT MEDICAL SYSTEMS, INC.
Pursuant to the provisions of the Utah Revised Business Corporation Act,
the undersigned corporation (the "Corporation") hereby adopts the following
Articles of Amendment to its Articles of Incorporation:
I.
The name of the corporation is Merit Medical Systems, Inc.
II.
The following Amendments to the Articles of Incorporation were adopted by
the shareholders of the Corporation on May 21, 1997 in the manner prescribed by
the Utah Revised Business Corporation Act:
A. Article IV of the Articles of Incorporation is hereby amended to
read as follows:
ARTICLE IV
AUTHORIZED SHARES
The total number of shares of capital stock which the
corporation shall have authority to issue is 25 million (25,000,000)
of which five million (5,000,000) shall be shares of preferred
stock, no par value (hereinafter called "Preferred Stock") and 20
million (20,000,000) shall be shares of common stock, no par value
(hereinafter called "Common Stock").
The designation, powers, preferences and relative,
participating, optional or other special rights, and qualifications,
1
limitations or restrictions thereof, of each class of stock, and the
express grant of authority to the board of directors to amend these
Articles of Incorporation to fix the designation, powers,
preferences and relative, participating, optional or other special
rights, and qualifications, limitations or restrictions thereof, of
each share of Preferred Stock which are not fixed by these Articles
of Incorporation, are as follows:
A. PREFERRED STOCK
1. Number; Series. The Preferred Stock may be issued in one or
more series, from time to time, with each such series to have such
designation, powers, preferences and relative, participating,
optional or other special rights and qualifications, limitations or
restrictions thereof, as shall be stated and expressed in an
amendment to these Articles of Incorporation providing for the issue
of such series. The board of directors of the corporation is hereby
expressly vested with authority to amend the Articles of
Incorporation, without shareholder action or approval, to: (a)
create one or more series of Preferred Stock, fix the number of
shares of each such series (within the total number of authorized
shares of Preferred Stock available for designation as a part of
such series), and designate and determine, in whole or part, the
preferences, limitations, and relative rights of each series of
Preferred Stock; (b) alter or revoke the preferences, limitations
and relative rights granted to or imposed upon any wholly unissued
series of Preferred Stock; or (c) increase or decrease the number of
shares constituting any series of Preferred Stock (the number of
shares of which was originally fixed by the board of directors)
either before or after the issuance of shares of the series,
provided that the number may not be decreased below the number of
shares of such series then outstanding, or increased above the total
number of authorized shares of the Preferred Stock available for
designation as a part of such series. Without limiting the
foregoing, the authority of the board of directors with respect to
each such series shall include, but not be limited to, the
determination or fixing of the following:
(i) The distinctive designation and number of shares
comprising such series, which number may (except where otherwise
provided by the board of directors in creating such series) be
increased or decreased (but not below the number of shares then
outstanding) from time to time by like action of the board of
directors;
2
(ii) The dividend rate of such series, the conditions
and times upon which such dividends shall be payable, the relation
which such dividends shall bear to the dividends payable on any
other class or classes of stock or series thereof, or on the other
series of the same class, and whether dividends shall be cumulative
or noncumulative;
(iii) The conditions upon which the shares of such
series shall be subject to redemption by the corporation and the
times, prices and other terms and provisions upon which the shares
of the series may be redeemed;
(iv) Whether or not the shares of the series shall be
subject to the operation of retirement or sinking fund provisions to
be applied to the purchase or redemption of such shares and, if such
retirement or sinking fund be established, the annual amount thereof
and the terms and provisions relative to the operation thereof;
(v) Whether or not the shares of the series shall be
convertible into or exchangeable for shares of any other class or
classes, with or without par value, or of any other series of the
same class and, if provision is made for conversion or exchange, the
times, prices, rates, adjustments and other terms and conditions of
such conversion or exchange;
(vi) Whether or not the shares of the series shall have
voting rights, in addition to the voting rights provided by law,
and, if so, subject to the limitations hereinafter set forth, the
terms of such voting rights;
(vii) The rights of the shares of the series in the
event of voluntary or involuntary liquidation, dissolution or upon
distribution of assets of the corporation;
(viii) Any other powers, preferences and relative,
participating, optional or other special rights, and qualifications,
limitations or restrictions thereof, of the shares of such series,
as the board of directors may deem advisable.
2. Dividends. The holders of the shares of Preferred Stock
of each series shall be entitled to receive, when and as declared by
the board of directors, out of the funds legally available
3
for the payment of dividends, dividends at the rate fixed by the
board of directors for such series for the current period and, if
cumulative, for all prior periods for which such dividends are
cumulative.
Whenever, at any time, dividends on the then outstanding
Preferred Stock as may be required with respect to any series
outstanding shall have been paid or declared and set apart for
payment on the then outstanding Preferred Stock, and after complying
with respect to any retirement or sinking fund or funds for all
applicable series of Preferred Stock, the board of directors may,
subject to the provisions of the resolution or resolutions creating
the series of Preferred Stock, declare and pay dividends on the
Common Stock as provided in paragraph B.1. of this Article IV, and
the holders of shares of Preferred Stock shall not be entitled to
share therein, except as otherwise provided in the amendment
creating any series.
3. Liquidation; Dissolution. The holders of the Preferred
Stock of each series shall be entitled upon liquidation or
dissolution of the corporation to such preferences as are provided
in the amendment creating such series of Preferred Stock, and no
more, before any distribution of the assets of the corporation shall
be made to the holders of shares of the Common Stock. Whenever the
holders of shares of the Preferred Stock shall have been paid the
full amounts to which they shall be entitled, the holders of shares
of the Common Stock shall be entitled to share in all assets of the
corporation remaining as provided in paragraph B.2. of this Article
IV. If, upon such liquidation, dissolution or winding up, the assets
of the corporation distributable as aforesaid among the holders of
Preferred Stock of all series shall be insufficient to permit full
payment to them of said preferential amounts, then such assets shall
be distributed ratably among such holders in proportion to the
respective total amounts which they shall be entitled to receive as
provided in this paragraph 3.
4. Voting. Except as otherwise provided by an amendment to
the Articles of Incorporation creating any series of Preferred Stock
or by the general corporation law of Utah, the Common Stock issued
and outstanding shall have and possess the exclusive power to vote
for the election of directors and for all other purposes as provided
in paragraph B.3. of this Article IV.
4
5. Preemptive Rights. Except as may be provided in the
amendment adopted by the board of directors providing for the issue
of any series of Preferred Stock, no holder of shares of the
Preferred Stock of the corporation shall, as such holder, be
entitled as of right to subscribe for, purchase or receive any part
of any new or additional issue of stock of any class, whether now or
hereafter authorized, or of bonds, debentures or other securities
convertible into or exchangeable for stock, but all such additional
shares of stock of any class, or bonds, debentures or other
securities convertible into or exchangeable for stock, may be issued
and disposed of by the board of directors on such terms and for such
consideration, so far as may be permitted by law, and to such
persons, as the board of directors in its absolute discretion may
deem advisable.
B. COMMON STOCK
1. Dividends. Subject to the rights of the holders of
Preferred Stock, and subject to any other provisions of the Articles
of Incorporation, holders of Common Stock shall be entitled to
receive such dividends and other distributions in cash, stock or
property of the corporation as may be declared thereon by the board
of directors from time to time out of assets or funds of the
corporation legally available therefor.
2. Liquidation; Dissolution. In the event of any liquidation,
dissolution or winding up of the affairs of the corporation, whether
voluntary or involuntary, after payment or provision for payment of
the debts and other liabilities of the corporation and after payment
or provision for payment to the holders of each series of Preferred
Stock of all amounts required in accordance with paragraph A.3. of
this Article IV, the remaining assets and funds of the corporation
shall be divided among and paid to the holders of Common Stock.
3. Voting.
(a) At every meeting of the shareholders every holder of
Common Stock shall be entitled to one vote in person or by proxy for
each share of such Stock standing in his name on the stock transfer
records of the corporation.
(b) No shareholder shall have the right to cumulate
votes in the election of directors.
5
4. Preemptive Rights. No holder of shares of Common Stock of
the corporation shall, as such holder, be entitled as of right to
subscribe for, purchase or receive any part of any new or additional
issue of stock of any class, whether now or hereafter authorized, or
of bonds, debentures or other securities convertible into or
exchangeable for stock, but all such additional shares of stock of
any class, or bonds, debentures or other securities convertible into
or exchangeable for stock, may be issued and disposed of by the
board of directors on such terms and for such consideration, so far
as may be permitted by law, and to such persons, as the board of
directors in its absolute discretion may deem advisable.
B. Article VI of the Articles of Incorporation is hereby amended to
read as follows:
ARTICLE VI
DIRECTORS
The board of directors shall consist of such number of
members, which number shall not be less than three and not more than
nine as may be determined and established from time to time by the
board of directors and shall be divided into three classes, as
nearly equal in size as possible. No increase in the maximum number
of members shall be made except upon the affirmative vote of not
less than two-thirds of the outstanding capital stock of the
corporation entitled to vote thereon. The initial terms of directors
first elected or reelected by the shareholders after the adoption of
this amendment and revision of the Articles of Incorporation shall
be for the following terms of office:
Class A Directors - One Year
Class B Directors - Two Years
Class C Directors - Three Years
Upon the expiration of the initial term specified for each
class of directors, their successors shall be elected for three-year
terms or until such time as their successors shall be elected and
qualified, with one class of directors to be elected each year.
6
Vacancies on the board of directors, whether the result of
removal (with or without cause), death, resignation or otherwise,
shall be filled by majority vote of the remaining members of the
board of directors, regardless of whether such remaining members
constitute a quorum.
The corporation shall nominate persons to serve as members of
the board of directors upon the expiration of the term of each class
of directors, which nominations shall be submitted to the
shareholders at the annual meeting of shareholders for approval. Any
nominations for election to the board of directors shall be
received, with respect to any annual meeting of shareholders, not
later than the date specified by the board of directors for
submission of such nominations. Failure to submit timely nominations
shall prevent consideration of the nominations at such annual
shareholders' meetings.
Directors of the corporation may be removed "for cause" only
upon the affirmative vote of the holders of a majority of the
outstanding capital stock entitled to vote thereon. A director may
be removed for cause only after a finding that (i) the director
engaged in fraudulent or dishonest conduct or gross abuse of
authority or discretion, with respect to the corporation and (ii)
removal is in the best interests of the corporation. Directors of
the corporation may be removed for any reason other than cause only
upon the affirmative vote of the holders of not less than two-thirds
of the outstanding capital stock of the corporation entitled to vote
thereon.
III.
The number of shares of the capital stock of the Corporation outstanding
and entitled to be cast on the foregoing Amendments by the shareholders of the
Corporation was 7,239,681 shares of common stock (the "Common Stock"). No other
class of shares was issued and outstanding.
IV.
The number of shares of the Common Stock voted for the Amendment to
Article IV was 2,962,020 shares; 977,908 shares of the Common Stock were voted
against such Amendment. The number of shares of the Common Stock voted for the
Amendment to Article VI was 3,161,677 shares; 970,848 shares of the Common Stock
were voted against such Amendment.
7
DATED this 12 day of June , 1997.
Merit Medical Systems, Inc., a Utah corporation
By: /s/ KENT W. STANGER
-------------------------------------------
Kent W. Stanger, Chief Financial Officer,
Secretary and Treasurer
8