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Exhibit 3.1
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
JERRY'S FAMOUS DELI, INC.
Isaac Starkman certifies that:
1. He is the President and Secretary of Jerry's Famous Deli,
Inc., a California corporation.
2. The Articles of Incorporation of this Corporation are amended
and restated to read in their entirety as follows:
I
The name of this Corporation is:
JERRY'S FAMOUS DELI, INC.
II
The purpose of the Corporation is to engage in any lawful act or
activity for which a corporation may be organized under the General Corporation
Law of California other than the banking business, the trust company business
or the practice of a profession permitted to be incorporated by the California
Corporations Code.
III
This Corporation is authorized to issue two classes of shares
designated "Common Stock" and "Preferred Stock," respectively.
A. The number of shares of Common Stock authorized to be issued
is Sixty Million (60,000,000), each and all of which shares shall be without
par value. On the effective date of these Amended and Restated Articles of
Incorporation, each then outstanding share of Common Stock is split-up, divided
and converted into 7,460 shares of Common Stock without par value.
B. The total number of Preferred Shares which this corporation
shall have authority to issue is Five Million (5,000,000). The Board of
Directors is authorized, subject to limitations prescribed by law, to provide
for the issuance of the shares of Preferred Stock in series, and by filing a
certificate pursuant to the
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applicable law of the State of California, to establish from time to time the
number of shares to be included in each such series and to fix the designation,
powers, preferences and rights of the shares of each such series and the
qualifications, limitations or restrictions thereof.
IV
The liability of the directors of the Corporation for monetary damages
shall be eliminated to the fullest extent permissible under California law.
V
The Corporation is authorized to provide indemnification of agents (as
defined in Section 317 of the California Corporations Code) for breach of duty
to the Corporation and its shareholders through bylaw provisions or through
agreements with the agents, or both, in excess of the indemnification otherwise
permitted by Section 317 of the California Corporations Code, subject to the
limits on such excess indemnification set forth in Section 204 of the
California Corporations Code.
3. The foregoing amendment and restatement of Articles of
Incorporation has been approved by the Board of Directors of said corporation.
4. The foregoing amendment and restatement of Articles of
Incorporation has been duly approved by the required vote of shareholders in
accordance with Section 902 of the Corporations Code. The total number of
outstanding shares of the corporation is 1,000. The number of shares voting in
favor of the amendment equaled or exceeded the vote required. The percentage
vote required was more than 50%.
He further declares under penalty of perjury under the laws of
the State of California that the matters set forth in the foregoing Certificate
are true and correct of his own knowledge.
Dated: December 13, 1994.
/s/ ISAAC STARKMAN
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Isaac Starkman,
President and Secretary
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SECOND AMENDED AND RESTATED
CERTIFICATE OF DETERMINATION OF RIGHTS AND
PREFERENCES OF SERIES A PREFERRED SHARES
OF
JERRY'S FAMOUS DELI, INC.
Isaac Starkman hereby certifies that:
1. He is the duly elected and acting President and Secretary of
Jerry's Famous Deli, Inc., a California corporation (the "Corporation").
2. Pursuant to authority given by the Corporation's Articles of
Incorporation, the Board of Directors of the Corporation has duly adopted the
following resolutions:
Whereas, Article III of the Articles of Incorporation of the
Corporation authorizes one class of shares designated Preferred
Shares, comprising Five Million (5,000,000) shares issuable from time
to time (the "Preferred Stock"), and one class of shares designated
Common Shares, comprising Sixty Million (60,000,000) shares issuable
from time to time (the "Common Stock"); and
Whereas, the Board of Directors of the Corporation is
authorized to fix or alter the rights, preferences, privileges, and
restrictions granted to or imposed upon the Preferred Stock until such
time as any of those shares have been issued, including but not
limited to the dividend rights, dividend rate, conversion rights, and
voting rights; and
Whereas, the Board of Directors has previously adopted a
Certificate of Determination and a subsequent Amended and Restated
Certificate of Determination providing for the issuance of a series of
Preferred Shares of the corporation consisting of Eight Thousand
(8,000) shares designated as "Series A Preferred Stock", and fixing
the rights, preferences, restrictions and other matters relating to
said Series A Preferred Stock; and
Whereas, the Corporation has not heretofore issued any shares
of such Series A Preferred Stock and it is the desire of the Board of
Directors of the Corporation, pursuant to its authority as aforesaid,
to amend the rights, preferences, restrictions and other matters
relating to the Preferred Stock as set forth in such Certificate of
Determination; and
WHEREAS, the Board of Directors has determined that it shall
adopt a Second Amended and Restated Certificate of Determination with
respect thereto;
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Now, Therefore, Be It Resolved, that the Board of Directors
does hereby provide for the issue of a series of preferred shares of
the Corporation consisting of Nineteen Thousand (19,000) shares of
$1,000 par value per share, designated as "Series A Preferred Stock",
and does hereby fix the rights, privileges, preferences, restrictions
and other matters relating to the Series A Preferred Stock as follows:
SECTION 1. GENERAL DEFINITIONS. For purposes of this Certificate of
Determination the following definitions shall apply:
(a) "AUTOMATIC CONVERSION DATE" shall mean the third anniversary
of the initial issuance of the Series A Preferred Stock.
(b) "BOARD OF DIRECTORS" shall mean the Board of Directors of the
Corporation, as such Board of Directors may be constituted from time to time
hereafter.
(c) "CLOSING PRICE" shall, unless another meaning is specified,
mean the average closing bid price of the Common Stock over the five Trading
Days prior to the applicable date, as reported by Bloomberg, L.P.
(d) "COMMON STOCK" shall mean the Common Stock of the Corporation.
(e) "COMMISSION" shall mean the United States Securities and
Exchange Commission, or any successor thereto.
(f) "CONVERSION RATIO" shall have the meaning set forth in Section
5(c) hereof. The Conversion Ratio shall not be calculated until after the
delivery of the Conversion Notice, as defined in Section 5(g) hereof.
(g) "CORPORATION" shall mean Jerry's Famous Deli, Inc., a
California corporation.
(h) "DESIGNATED VALUE" shall mean the sum of One Thousand Dollars
($1,000) per share of Series A Preferred Stock plus all accrued and unpaid
dividends thereon.
(i) "LIQUIDATION PREFERENCE" shall mean, for each share of Series
A Preferred Stock, an amount equal to the Designated Value on the date of the
liquidating distribution.
(j) "PRO RATA SHARE" shall mean, as of any date, a number equal to
the ratio of the number of shares of Series A Preferred Stock of the
Corporation owned by any holder divided by the total number of shares of Series
A Preferred Stock outstanding on such date.
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(k) "SERIES A PREFERRED STOCK" shall mean the Series A Preferred
Stock of the Corporation.
(l) "TRADING DAY" shall mean any day when securities may be bought
or sold on the New York Stock Exchange or the Nasdaq Stock Market.
2. DIVIDEND RIGHTS.
(a) DIVIDEND PAYMENT. The holders of the Series A
Preferred Stock shall be entitled to receive dividends at the rate of Eighty
Dollars ($80.00) per share per year, payable quarterly in arrears on the last
day of March, June, September and December, commencing September 30, 1996, in
cash or, at the option of the Corporation, in shares of Common Stock as set
forth herein. Dividends on the Series A Preferred Stock shall be payable out
of any funds legally available therefor, prior and in preference to any
dividend payment with respect to Common Stock. Dividends on the Series A
Preferred Stock shall be cumulative, so that if dividends required to be paid
on such stock for any quarter or quarters shall not have been paid, the amount
of the deficiency shall be paid in full, without interest, together with any
dividends due for the current quarter, before any distribution of any kind
shall be paid to the holders of the Common Stock.
(b) The Corporation may, at its option, as to any
dividends accruing on or prior to the Automatic Conversion Date, but not
including those dividends payable on the last day of September and December of
1996 and the last day of March and June of 1997, pay accrued dividends on the
Series A Preferred Stock in shares of Common Stock. As to any payment of
dividends as to which the Corporation issues shares of Common Stock in lieu of
cash, each holder of Series A Preferred Stock shall receive the number of
shares of Common Stock equal to the product of (y) the amount of accrued and
unpaid dividends on the Series A Preferred Stock, divided by (z) the Closing
Price of the Common Stock over the five Trading Days ending on the day prior to
the dividend payment date.
(c) No fractional shares of Common Stock will be issued
as dividends upon the Series A Preferred Stock. Any fractional shares which
otherwise result from a dividend on the Series A Preferred Stock will be
redeemed by payment in cash of an amount equal to such fraction by the Closing
Price per share of Common Stock as promptly as funds legally are available
therefor.
SECTION 3. VOTING RIGHTS.
Except as otherwise required by law, the Common Stock shall have
exclusive voting rights and powers, including the exclusive right to notice of
shareholders' meetings. The Series A Preferred Stock shall have no voting
rights, except as required by law.
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SECTION 4. LIQUIDATION PROVISIONS.
(a) LIQUIDATION PREFERENCE. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation
("Liquidation"), the holders of the shares of Series A Preferred Stock shall be
entitled to receive, out of the assets of the Corporation available for
distribution to the holders of equity securities of the Corporation, an amount
equal to the Liquidation Preference for each share of Series A Preferred Stock
held by them, and no more, before any payment shall be made or any assets
distributed to the holders of the shares of Common Stock of the Corporation.
If upon such Liquidation the assets available for distribution to the holders
of the Series A Preferred Stock shall be insufficient to permit the payment to
those persons of the full Liquidation Preference for all shares of Series A
Preferred Stock held by them, then the entire remaining assets of the
Corporation available for such distribution shall be distributed ratably among
the holders of the shares of Series A Preferred. So long as shares of Series A
Preferred Stock are issued and outstanding, no shares of any class of preferred
stock of the Corporation shall be issued with a liquidation preference senior
to the Series A Preferred Stock, although such liquidation preference may be
equal to the Series A Preferred Stock.
(b) SERIES A PREFERRED STOCK NON-PARTICIPATING. Upon any
Liquidation of the Corporation, after payment or distribution of the aggregate
Liquidation Preference for all then-outstanding shares of Series A Preferred
Stock, as provided in Section 4(a) hereof, all remaining assets of the
Corporation shall be distributed ratably among the holders of the Common Stock
of the Corporation, and the holders of shares of the Series A Preferred Stock
shall have no right to participate therein.
SECTION 5. CONVERSION.
(a) CONVERSION BY HOLDERS. The Series A Preferred Stock shall be
convertible at the option of the holders thereof into such number of shares of
Common Stock as is determined under the Conversion Ratio beginning ninety (90)
days following the initial issuance of the Series A Preferred Stock.
(b) AUTOMATIC CONVERSION. Any shares of Series A Preferred Stock
not converted into Common Stock prior to the Automatic Conversion Date shall,
on that date, automatically be converted into such number of shares of Common
Stock as is determined under the Conversion Ration.
(c) CONVERSION RATIO. Upon a conversion of Preferred Shares in
accordance with Section 5(a) or (b) hereof, each share of Series A Preferred
Stock shall be converted into the number of shares of Common Stock resulting
from the product of the Designated Value, divided by the product of (y) the
Closing Price, multiplied by (z) 0.83 (the "Conversion Ratio"); provided, that
notwithstanding the foregoing, the denominator of the
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Conversion Ratio shall never exceed $6.00 per share of Common Stock (the
"Maximum Ratio"), or be less than $3.00 per share of Common Stock (the "Minimum
Ratio").
(d) FRACTIONAL SHARES UPON CONVERSION. No fractional
shares of Common Stock will be issued upon conversion of Series A Preferred
Stock and any fractional shares which otherwise result from conversion by a
holder of all his shares of Series A Preferred Stock (taken together as a
group) will be redeemed by payment in cash of an amount equal to such fraction
by the Closing Price per share of Common Stock as promptly as funds legally are
available therefor.
(e) ADJUSTMENT FOR COMBINATION OR CONSOLIDATIONS OF
COMMON STOCK. If the Corporation at any time or from time to time after the
effective date of the initial sale of the Series A Preferred Stock (hereafter
referred to as the "Original Issue Date") effects a subdivision or combination
of its outstanding Common Stock into a greater or lesser number of shares
without a proportionate and corresponding subdivision or combination of its
outstanding Series A Preferred Stock, then the existing Conversion Ratio for
the Series A Preferred Stock will be increased or decreased proportionately.
(f) ADJUSTMENT FOR DIVIDENDS, DISTRIBUTIONS AND COMMON
STOCK EQUIVALENTS. If the Corporation at any time or from time to time after
the Original Issue Date makes or issues a dividend payable in Common Stock to
holders of record of its Common Stock, or fixes a record date for 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 ("Common Stock Equivalents"), convertible into or
entitling the holder thereof to receive additional shares of Common Stock
without payment of any consideration by such holder for Common Stock
Equivalents or the additional shares of Common Stock, then and in such event,
for the purpose of protecting the holders of Series A Preferred Stock from any
dilution in connection therewith, the maximum number of shares (as set forth in
the instrument relating thereto without regard to any provisions contained
therein for a subsequent adjustment of such number) of Common Stock issuable in
payment of such dividends or distribution or upon conversion or exercise of
such Common Stock Equivalents will be deemed to be issued and outstanding as of
the time of such issuance or, in the event such a record date has been fixed,
as of the close of business on such a record date. In each such event the then
existing Conversion Ratio for the Series A Preferred Stock will be increased as
of the time of such issuance or, in the event such a record date has been
fixed, as of the close of business on such record date, by multiplying the
Conversion Ratio for the Series A Preferred Stock by a fraction, the numerator
of which will be the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the close of
business on such record date plus the number of shares of Common Stock issuable
in payment of such dividend or distribution or upon conversion or exercise of
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such Common Stock Equivalents, and the denominator of which will be the total
number of shares of Common Stock issued and outstanding immediately prior to
the time of such issuance or the close of business on such record date;
provided, however, if such record date has been fixed and such dividend is not
fully paid or if such distribution is not made on the date fixed therefor, the
Conversion Ratio for the Series A Preferred Stock will be recomputed
accordingly as of the close of business on such record date and thereafter the
Conversion Ratio for the Series A Preferred Stock will be adjusted pursuant to
this paragraph 5(f) as of the date of actual payment of such dividends or
distributions.
(g) MECHANICS OF CONVERSION. Any holder of Series A
Preferred Stock may exercise its conversion right on or after ninety days after
the issuance of the Series A Preferred Stock and before the Automatic
Conversion Date by delivery to the Corporation of a notice (a "Conversion
Notice"), stating the number of shares of Series A Preferred Stock to be
converted, which may be delivered by facsimile for purposes of fixing the date
of conversion so long as the certificates for the Series A Preferred Stock to
be converted are in physical custody of the Corporation or its transfer agent
not later than the fifth business day after the facsimile is sent. Before any
holder of Series A Preferred Stock will be entitled to convert the same into
shares of Common Stock, it will surrender the certificate or certificates
therefor, duly endorsed, at the office of the Corporation or of any transfer
agent for the Series A Preferred Stock, and it will give written notice to the
Corporation stating the name or names in which it wishes the certificate or
certificates for shares of Common Stock to be issued. The Corporation, as soon
as practicable but in any event no later than five business (5) days after the
date of receipt by the Corporation of the Conversion Notice provided the
Corporation has physical custody of the certificates for the Preferred Stock on
such date, will issue and deliver to such holder of Series A Preferred Stock or
to its nominee or nominees, a certificate or certificates for the number of
shares of Common Stock to which it will be entitled as aforesaid. Such
conversion will be deemed to have been made immediately prior to the close of
business on the date that the Corporation has received such notice and
certificate(s), and the person or persons entitled to receive the shares of
Common Stock issuable upon conversion will be treated for all purposes as the
record holder or holders of such shares of Common Stock on such date.
(h) NO IMPAIRMENT. The Corporation, whether by amendment
of its Articles of Incorporation, or through any reorganization, transfer of
assets, merger, dissolution, issue or sale of securities or any other voluntary
action, will not avoid or seek to avoid the observance or performance of any of
the terms to be observed hereunder by the Corporation, but at all times in good
faith will assist in the carrying out of all of such action as may be necessary
or appropriate in order to
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protect the conversion rights of the holders of the Series A Preferred Stock
against impairment.
(i) RESERVATION OF STOCK ISSUABLE UPON CONVERSION. The
Corporation at all times will reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purposes of effecting the
conversion of the shares of the Series A Preferred Stock, such number of its
shares of Common Stock as from time to time will be sufficient to effect the
conversion of all of the then outstanding shares of the Series A Preferred
Stock; and if at any time the number of authorized but unissued shares of
Common Stock is not sufficient to effect the conversion of all of the then
outstanding shares of the Series A Preferred Stock, in addition to such other
remedies as may be available to the holders of Series A Preferred Stock for
such failure, the Corporation will take such actions as, in the opinion of its
counsel, may be necessary to increase its authorized but unissued shares of
Common Stock to such number of shares as will be sufficient for such purposes.
Resolved Further, that the President and the Secretary of the
Corporation hereby are authorized and directed to prepare, execute,
verify, file and record a certificate of determination of preferences
in accordance with the foregoing resolutions and the provisions of
California law.
3. The authorized number of shares of Series A Preferred Stock is
Nineteen Thousand (19,000), none of which has been issued.
4. No vote of the shareholders was required.
Dated: August 23, 1996
/s/ ISAAC STARKMAN
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Isaac Starkman,
President and Secretary
The undersigned declares under penalty of perjury that the matters set
forth in the foregoing certificate are true of his own knowledge.
Executed at Los Angeles, California, on August 23, 1996.
/s/ ISAAC STARKMAN
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Isaac Starkman,
President and Secretary
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