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Exhibit 3.1
CERTIFICATE OF INCORPORATION
OF
SOVEREIGN SPECIALTY CHEMICALS, INC.
ARTICLE ONE
The name of the corporation is Sovereign Specialty Chemicals, Inc.
ARTICLE TWO
The address of the corporation's registered office in the State of
Delaware is the Corporation Trust Center, 1209 Orange Street, in the City of
Wilmington, County of New Castle. The name of its registered agent at such
address is The Corporation Trust Company.
ARTICLE THREE
The nature of the business or purposes to be conducted or promoted 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.
ARTICLE FOUR
PART A. AUTHORIZED SHARES
The total number of shares of capital stock which the Corporation has
authority to issue is 1,000 shares, consisting of:
(1) 100 shares of Class A Common Stock, par value $.01 per share ("Class
A Common"); and
(2) 900 shares of Class B Common Stock, par value $.01 per share ("Class
B Common").
The Class A Common and Class B Common are referred to collectively as the
"Common Stock." The shares of Common Stock shall have the rights, preferences
and limitations set forth below. Capitalized terms used but not otherwise
defined in Part A or Part B of this Article IV are defined in Part C.
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PART B. COMMON STOCK
Except as otherwise provided in this Part B or as otherwise required by
applicable law, all shares of Class A Common and Class B Common shall be
identical in all respects and shall entitle the holders thereof to the same
rights, preferences and privileges, subject to the same qualifications,
limitations and restrictions, as set forth herein.
Section 1. Voting Rights. Except as otherwise provided in this Part B or
as otherwise required by applicable law, all holders of Class A Common and Class
B Common shall be entitled to one vote per share on all matters to be voted on
by the Corporation's stockholders, and the holders of Class A Common and Class B
Common shall vote together as a single class.
Section 2. Distributions. At the time of each Distribution, such
Distribution shall be made to the holders of Class A Common and Class B Common
in the following amounts and priority:
(i) The holders of Class A Common, as a separate class, shall be
entitled to receive all or a portion of such Distribution (ratably among such
holders based upon the number of shares of Class A Common held by each such
holder as of the time of such Distribution) equal to the aggregate Unpaid Yield
on the outstanding shares of Class A Common as of the time of such Distribution,
and no Distribution or any portion thereof shall be made under paragraphs 2(ii)
or 2(iii) below until the entire amount of the Unpaid Yield on the outstanding
shares of Class A Common as of the time of such Distribution has been paid in
full. The Distributions made pursuant to this paragraph 2(i) to holders of Class
A Common shall constitute a payment of Yield on Class A Common.
(ii) After the required amount of a Distribution has been made in full
pursuant to paragraph 2(i) above, the holders of Class A Common, as a separate
class, shall be entitled to receive all or a portion of such Distribution
(ratably among such holders based upon the number of shares of Class A Common
held by each such holder as of the time of such Distribution) equal to the
aggregate Unpaid Liquidation Value of the outstanding shares of Class A Common
as of the time of such Distribution, and no Distribution or any portion thereof
shall be made under paragraph 2(iii) below until the entire amount of the Unpaid
Liquidation Value of the outstanding shares of Class A Common as of the time of
such Distribution has been paid in full. The Distributions made pursuant to this
paragraph 2(ii) to holders of Class A Common shall constitute a payment of the
Liquidation Value of Class A Common.
(iii) After the required amount of a Distribution has been made pursuant
to paragraphs 2(i) and 2(ii) above, the holders of Class A Common and Class B
Common, as a group, shall be entitled to receive the remaining portion of such
Distribution (ratably among such holders based upon the number of shares of
Common Stock held by each such holder as of the time of such Distribution).
Section 3. Stock Splits and Stock Dividends. The Corporation shall not in
any manner subdivide (by stock split, stock dividend or otherwise) or combine
(by stock split, stock
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dividend or otherwise) the outstanding Common Stock of one class unless the
outstanding Common Stock of all the other classes shall be proportionately
subdivided or combined. All such subdivisions and combinations shall be payable
only in Class A Common to the holders of Class A Common and in Class B Common to
the holders of Class B Common. In no event shall a stock split or stock dividend
constitute a payment of Yield or Liquidation Value.
Section 4. Registration of Transfer. The Corporation shall keep at its
principal office (or such other place as the Corporation reasonably designates)
a register for the registration of shares of Common Stock. Upon the surrender of
any certificate representing shares of any class of Common Stock at such place,
the Corporation shall, at the request of the registered holder of such
certificate, execute and deliver a new certificate or certificates in exchange
therefor representing in the aggregate the number of shares of such class
represented by the surrendered certificate, and the Corporation forthwith shall
cancel such surrendered certificate. Each such new certificate shall be
registered in such name and shall represent such number of shares of such class
as is requested by the holder of the surrendered certificate and shall be
substantially identical in form to the surrendered certificate. The issuance of
new certificates shall be made without charge to the holders of the surrendered
certificates for any issuance tax in respect thereof or other cost incurred by
the Corporation in connection with such issuance.
Section 5. Replacement. Upon receipt of evidence reasonably satisfactory
to the Corporation (an affidavit of the registered holder shall be satisfactory)
of the ownership and the loss, theft, destruction or mutilation of any
certificate evidencing one or more shares of any class of Common Stock, and in
the case of any such loss, theft or destruction, upon receipt of indemnity
reasonably satisfactory to the Corporation (provided that if the holder is a
financial institution or other institutional investor its own agreement shall be
satisfactory), or, in the case of any such mutilation upon surrender of such
certificate, the Corporation shall (at its expense) execute and deliver in lieu
of such certificate a new certificate of like kind representing the number of
shares of such class represented by such lost, stolen, destroyed or mutilated
certificate and dated the date of such lost, stolen, destroyed or mutilated
certificate.
Section 6. Notices. All notices referred to herein shall be in writing,
shall be delivered personally or by first class mail, postage prepaid, and shall
be deemed to have been given when so delivered or mailed to the Corporation at
its principal executive offices and to any stockholder at such holder's address
as it appears in the stock records of the Corporation (unless otherwise
specified in a written notice to the Corporation by such holder).
Section 7. Amendment and Waiver. No amendment or waiver of any provision
of this Article IV shall be effective without the prior written consent of the
holders of a majority of the then outstanding shares of Common Stock voting as a
single class; provided that no amendment directly to any terms or provisions of
any class of Common Stock that adversely affects such class of Common Stock
shall be effective without the prior consent of the holders of a majority of the
then outstanding shares of such class of Common Stock.
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PART C. DEFINITIONS
"Distribution" means each distribution made by the Corporation to holders
of Common Stock, whether in cash, property, or securities of the Corporation and
whether by dividend, liquidating distributions or otherwise; provided that
neither of the following shall be a Distribution: (a) any redemption or
repurchase by the Corporation of any shares of Common Stock for any reason or
(b) any recapitalization or exchange of any shares of Common Stock, or any
subdivision (by stock split, stock dividend or otherwise) or any combination (by
stock split, stock dividend or otherwise) of any outstanding shares of Common
Stock.
"Liquidation Value" of each share of Class A Common shall be equal to
$360,000 (as proportionally adjusted for all stock splits, stock dividends and
other recapitalizations affecting the Common Stock).
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"Subsidiary" means with respect to any Person, any corporation of which
the shares of stock having a majority of the general voting power in electing
the board of directors are, at the time as of which any determination is being
made, owned by such Person either directly or indirectly through Subsidiaries.
"Unpaid Liquidation Value" of any share of Common Stock means an amount
equal to the excess, if any, of (a) the Liquidation Value of such share, over
(b) the aggregate amount of Distributions made by the Corporation that
constitute a payment of Liquidation Value of such share.
"Unpaid Yield" of any share of Common Stock means an amount equal to the
excess, if any, of (a) the aggregate Yield accrued on such share, over (b) the
aggregate amount of Distributions made by the Corporation that constitute
payment of Yield on such share.
"Yield" means, with respect to each share of Class A Common, the amount
accruing on such share on a daily basis at the rate of 8% per annum, compounded
annually on the sum of (a) such share's Unpaid Liquidation Value plus (b) Unpaid
Yield thereon. In calculating the amount of any Distribution to be made during a
period, the portion of a Class A Common share's Yield for such portion of such
period elapsing before such Distribution is made shall be taken into account.
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ARTICLE FIVE
The name and mailing address of the sole incorporator are as follows:
NAME MAILING ADDRESS
Maureen L. Maher 200 East Randolph Drive
Suite 5700
Chicago, Illinois 60601
ARTICLE SIX
The corporation is to have perpetual existence.
ARTICLE SEVEN
In furtherance and not in limitation of the powers conferred by statute,
the board of directors of the corporation is expressly authorized to make, alter
or repeal the by-laws of the corporation.
ARTICLE EIGHT
Meetings of stockholders may be held within or without the State of
Delaware, as the by-laws of the corporation may provide. The books of the
corporation may be kept outside the State of Delaware at such place or places as
may be designated from time to time by the board of directors or in the by-laws
of the corporation. Election of directors need not be by written ballot unless
the by-laws of the corporation so provide.
ARTICLE NINE
To the fullest extent permitted by the General Corporation Law of the
State of Delaware as the same exists or may hereafter be amended, a director of
this corporation shall not be liable to the corporation or its stockholders for
monetary damages for a breach of fiduciary duty as a director. Any repeal or
modification of this ARTICLE NINE shall not adversely affect any right or
protection of a director of the corporation existing at the time of such repeal
or modification.
ARTICLE TEN
The corporation expressly elects not to be governed by Section 203 of the
General Corporation Law of the State of Delaware.
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ARTICLE ELEVEN
The corporation reserves the right to amend, alter, change or repeal any
provision contained in this certificate of incorporation in the manner now or
hereafter prescribed herein and by the laws of the State of Delaware, and all
rights conferred upon stockholders herein are granted subject to this
reservation.
I, THE UNDERSIGNED, being the sole incorporator hereinbefore named, for
the purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, do make this certificate, hereby declaring and certifying
that this is my act and deed and the facts stated herein are true, and
accordingly have hereunto set my hand on the 29th day of July, 1997.
Maureen L. Maher
Sole Incorporator
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