EXHIBIT 3.1
(Restated electronically for
SEC filing purposes only)
RESTATED CHARTER
OF
AMERICAN RETIREMENT CORPORATION
The undersigned, acting as the incorporator of a corporation under the
Tennessee Business Corporation Act, adopts the following charter for such
corporation:
1. The name of the corporation is American Retirement Corporation.
2. The corporation is for profit.
3. The duration of the corporation is perpetual.
4. The street address and zip code of the corporation's principal
office in Tennessee will be:
111 Westwood Place, Suite 402
Brentwood, Tennessee 37027
County of Williamson
5. (a) The name of the corporation's registered agent is
W.E. Sheriff.
(b) The street address, zip code, and county of the
corporation's registered office and registered agent in Tennessee shall be:
111 Westwood Place, Suite 402
Brentwood, Tennessee 37027
County of Williamson
6. The name and address of the incorporator is:
W.E. Sheriff
111 Westwood Place, Suite 402
Brentwood, Tennessee 37027
7. The corporation is organized to do any and all things and to
exercise any and all powers, rights, and privileges that a corporation may now
or hereafter be organized to do or to exercise under the Tennessee Business
Corporation Act, as amended from time to time.
8. The maximum number of shares of stock the corporation is
authorized to issue is:
a. Two hundred million (200,000,000) shares of common
stock, par value $.01 per share, which shall be entitled to one vote per share
and, upon dissolution of the corporation, shall be entitled to receive the net
assets of the corporation.
b. Five million (5,000,000) shares of preferred stock
without par value. Shares of preferred stock may be issued from time to time in
one or more classes or series, each such class or series to be so designated as
to distinguish the shares thereof from the shares of all other classes and
series. The Board of Directors is hereby vested with the authority to divide
preferred stock into classes or series and to fix and determine the relative
rights, preferences, qualifications, and limitations of the shares of any class
or series so established.
Pursuant to the authority vested in the Board of Directors in
accordance with the provisions of this Article 8 of the Charter, the
Board of Directors does hereby create, authorize and provide for the
issuance of the Series A Junior Preferred Stock out of the class of
5,000,000 shares of preferred stock, no par value per share (the
"Preferred Stock"), having the voting powers, designation, relative,
participating, optional and other special rights, preferences, and
qualifications, limitations and restrictions thereof that are set forth
as follows:
Section 1. Designation and Amount. The shares of such series
shall be designated as Series A Junior Preferred Stock ("Series A
Preferred Stock") and the number of shares constituting such series
shall be 2,000,000. Such number of shares may be adjusted by
appropriate action of the Board of Directors.
Section 2. Dividends and Distributions. Subject to the prior
and superior rights of the holders of any shares of any other series of
Preferred Stock or any other shares of Preferred Stock of the
corporation ranking prior and superior to the shares of Series A
Preferred Stock with respect to dividends, each holder of one
one-hundredth (1/100) of a share (a "Unit") 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 that purpose, dividends at
the same rate as dividends are paid with respect to the Common Stock.
In the event that the corporation shall at any time after December 7,
1998 (the "Rights Dividend Declaration Date") (i) declare or pay any
dividend on outstanding shares of Common Stock payable in shares of
Common Stock, or (ii) subdivide outstanding shares of Common Stock or
(iii) combine outstanding shares of Common Stock into a smaller number
of shares, then in each such case the amount to which the holder of a
Unit of Series A Preferred Stock was entitled immediately prior to such
event pursuant to the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which shall be
the number of shares of Common Stock that are outstanding immediately
after such event and the denominator of which shall be the number of
shares of Common Stock that were outstanding immediately prior to such
event.
Section 3. Voting Rights. The holders of Units of Series A
Preferred Stock shall have the following voting rights.
(A) Subject to the provision for adjustment hereinafter
set forth, each Unit of Series A Preferred Stock shall entitle the
holder thereof to one vote on all matters submitted to a vote of the
shareholders of the corporation. In the event the corporation shall at
any time after the Rights Dividend Declaration Date (i) declare any
dividend on outstanding shares of Common Stock payable in shares of
Common Stock, (ii) subdivide outstanding shares of Common Stock or
(iii) combine the outstanding shares of Common Stock into a smaller
number of shares, then in each such case the number of votes per Unit
to which holders of Units 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 shall be the number of
shares of Common Stock outstanding immediately prior to such event and
the denominator of which shall be the number of shares of Common Stock
that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the
holders of Units 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 shareholders of the corporation.
(C) Except as set forth herein or required by law,
holders of Units 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 shares of Common Stock
as set forth herein) for the taking of any corporate action.
Section 4. Reacquired Shares. Any Units of Series A Preferred
Stock purchased or otherwise acquired by the corporation in any manner
whatsoever shall be retired and cancelled promptly after the
acquisition thereof. All such Units shall, upon their cancellation,
become authorized but unissued Units 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.
Section 5. Liquidation. Upon any liquidation, dissolution or
winding up of the corporation, whether voluntary or involuntary, the
holders of Units of Series A Preferred Stock shall be entitled to share
in any assets remaining ratably with the holders of the Common Stock.
In the event the corporation shall at any time after the Rights
Dividend Declaration Date (i) increase by way of stock split or similar
transaction the number of outstanding shares of Common Stock, (ii)
subdivide the outstanding shares of Common Stock, or (iii) combine the
outstanding shares of Common Stock into a smaller number of shares,
then in each such case the aggregate amount to which holders of Units
of Series A Preferred Stock were entitled prior to such event shall be
adjusted by multiplying such amount by a fraction, the numerator of
which shall be the number of shares of Common Stock that are
outstanding immediately after such event and the denominator of which
shall be the number of shares of Common Stock that were outstanding
immediately prior to such event.
Section 6. Share Exchange, Merger, Etc. In case the
corporation shall enter into any share exchange, merger, combination or
other transaction in which the shares of Common Stock are exchanged for
or converted into other stock or securities, cash and/or
any other property, then in any such case Units of Series A Preferred
Stock shall at the same time be similarly exchanged for or converted
into an amount per Unit (subject to the provision for adjustment
hereinafter set forth) equal to 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
converted or exchanged. In the event the corporation shall at any time
after the Rights Dividend Declaration Date (i) declare any dividend on
outstanding shares of Common Stock payable in shares of Common Stock,
or (ii) subdivide outstanding shares of Common Stock, or (iii) combine
outstanding Common Stock into a smaller number of shares, then in each
such case the amount set forth in the immediately preceding sentence
with respect to the exchange or conversion of Units of Series A
Preferred Stock shall be adjusted by multiplying such amount by a
fraction the numerator of which shall be the number of shares of Common
Stock that are outstanding immediately after such event and the
denominator of which shall be the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. Redemption. The Units of Series A Preferred Stock
shall not be redeemable at the option of the corporation or any holder
thereof. Notwithstanding the foregoing sentence of this Section, the
corporation may acquire Units of Series A Preferred Stock in any other
manner permitted by law and the Charter or Bylaws of the corporation.
Section 8. Ranking. The Units of Series A Preferred Stock
shall rank junior to all other series of the Preferred Stock and to any
other class of preferred stock that hereafter may be issued by the
corporation as to the payment of dividends and the distribution of
assets, unless the terms of any such series or class shall provide
otherwise.
Section 9. Amendment. The Charter, including without
limitation the provisions hereof, shall not hereafter be amended,
either directly or indirectly, or through merger or share exchange with
another corporation, in any manner that would alter or change the
powers, preferences or special rights of the Series A Preferred Stock
so as to affect the holders thereof adversely without the affirmative
vote of the holders of a majority or more of the outstanding Units of
Series A Preferred Stock, voting separately as a class.
Section 10. Fractional Shares. The Series A Preferred Stock
may be issued in Units or other fractions of a share, which Units or
fractions 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.
9. The shareholders of the corporation shall not have preemptive
rights.
10. All corporate powers shall be exercised by or under the
authority of, and the business and affairs of the corporation shall be managed
under the direction of, a Board of Directors consisting of not less than three
nor more than fifteen directors, the exact number of directors to be determined
in the manner provided in the Bylaws of the corporation. The
directors shall be divided into three classes, designated Class I, Class II and
Class III. Each class shall consist, as nearly as may be possible, of one-third
of the total number of directors constituting the entire Board of Directors. At
the 1998 annual meeting of shareholders, Class I directors shall be elected; at
the 1999 annual meeting of shareholders, Class II directors shall be elected;
and at the 2000 annual meeting of shareholders, Class III directors shall be
elected. At each succeeding annual meeting of shareholders beginning with the
annual meeting in 1998, successors to the class of directors whose term expires
at that annual meeting shall be elected for three-year terms. If the number of
directors is changed, any increase or decrease shall be apportioned among the
classes so as to maintain the number of directors in each class as nearly equal
as possible, but in no case will a decrease in the number of directors shorten
the term of any incumbent director. A director shall hold office until the
annual meeting of shareholders for the year in which his or her term expires and
until his or her successor shall be elected and shall qualify, subject, however,
to prior death, resignation, retirement, disqualification, or removal from
office. Any vacancy on the Board of Directors, including a vacancy that results
from an increase in the number of directors or a vacancy that results from the
removal of a director with cause, may be filled only by the Board of Directors.
Any director may be removed from office but only for cause and only by
(a) the affirmative vote of the holders of a majority of the voting power of the
shares entitled to vote for the election of directors, considered for this
purpose as one class, unless a vote of a special voting group is otherwise
required by law, or (b) the affirmative vote of a majority of the entire Board
of Directors then in office.
Notwithstanding the foregoing, whenever the holders of any one or more
classes or series of Preferred Stock issued by the corporation shall have the
right, voting separately by class or series, to elect directors at an annual or
special meeting of shareholders, the election, term of office, filling of
vacancies, and other features of such directorships shall be governed by the
terms of this Charter applicable thereto.
11. To the fullest extent permitted by the Tennessee Business
Corporation Act as in effect on the date hereof, and as hereafter amended from
time to time, a director of the corporation shall not be liable to the
corporation or its shareholders for monetary damages for breach of fiduciary
duty as a director. If the Tennessee Business Corporation Act or any successor
statute is amended after adoption of this provision to authorize corporate
action further eliminating or limiting the personal liability of directors, then
the liability of a director of the corporation shall be eliminated or limited to
the fullest extent permitted by the Tennessee Business Corporation Act, as so
amended from time to time, or such successor statute. Any repeal or modification
of this Article 11 by the shareholders of the corporation shall not affect
adversely any right or protection of a director of the corporation existing at
the time of such repeal or modification or with respect to events occurring
prior to such time.
12. The corporation shall indemnify every person who is or was a
party or is or was threatened to be made a party to any action, suit, or
proceeding, whether civil, criminal, administrative, or investigative, by reason
of the fact that he or she is or was a director or officer or is or was serving
at the request of the corporation as a director, officer, employee, agent, or
trustee of another corporation or of a partnership, joint venture, trust,
employee benefit plan, or
other enterprise, including service on a committee formed for any purpose (and,
in each case, his or her heirs, executors, and administrators), against all
expense, liability, and loss (including counsel fees, judgments, fines, ERISA
excise taxes, penalties, and amounts paid in settlement) actually and reasonably
incurred or suffered in connection with such action, suit, or proceeding, to the
fullest extent permitted by applicable law, as in effect on the date hereof and
as hereafter amended. Such indemnification may include advancement of expenses
in advance of final disposition of such action, suit, or proceeding, subject to
the provision of any applicable statute.
The indemnification and advancement of expenses provisions of this
Article 12 shall not be exclusive of any other right that any person (and his or
her heirs, executors, and administrators) may have or hereafter acquire under
any statute, this Charter, the corporation's Bylaws, resolution adopted by the
shareholders, resolution adopted by the Board of Directors, agreement, or
insurance, purchased by the corporation or otherwise, both as to action in his
or her official capacity and as to action in another capacity. The corporation
is hereby authorized to provide for indemnification and advancement of expenses
through its Bylaws, resolution of shareholders, resolution of the Board of
Directors, or agreement, in addition to that provided by this Charter.
13. The Bylaws of this corporation may be amended, altered,
modified, or repealed by resolution adopted by the Board of Directors, subject
to any provisions of law then applicable.
14. The corporation shall hold a special meeting of shareholders
only in the event (a) of a call of the Board of Directors of the corporation or
the officers authorized to do so by the Bylaws of the corporation, or (b)the
holders of at least twenty-five percent of all the votes entitled to be cast on
any issue proposed to be considered at the proposed special meeting sign, date,
and deliver to the corporation's secretary one or more written demands for the
meeting describing the purpose or purposes for which it is to be held.
15. The affirmative vote of the holders of at least three-quarters
(3/4) of the voting power of the shares entitled to vote at an election of
directors shall be required to amend, alter, modify, or to repeal the provisions
of Articles 10 and 14, and this Article 15, of this Charter.