Exhibit 3.a
CERTIFICATE OF INCORPORATION
OF
UGLY DUCKLING CORPORATION
AMENDED AND RESTATED AS OF MAY 15, 1997
ARTICLE ONE
The name of the corporation is UGLY DUCKLING CORPORATION.
ARTICLE TWO
The address of the corporation's registered office in the State of Delaware is
1209 Orange Street, in the City of Wilmington, County of New Castle. The name
of its registered agent at such address is Corporation Trust Company.
ARTICLE THREE
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.
ARTICLE FOUR
The Corporation shall have perpetual existence.
ARTICLE FIVE
A. The corporation shall be authorized to issue two classes of shares of
stock to be designated, respectively, "Common Stock" and "Preferred Stock";
the total number of shares of Common Stock that the corporation shall have
authority to issue shall be 100,000,000, and each of such shares shall have a
par value of $.001; and the total number of shares of Preferred Stock that the
corporation shall have the authority to issue shall be 10,000,000, and each of
such shares shall have a par value of $.001.
B. Shares of Preferred Stock may be issued from time to time in one or
more series as may from time to time be determined by the Board of Directors
of the corporation, each of said series to be distinctly designated. The
voting powers, preferences and relative, participating, optional, and other
special rights, and the qualifications, limitations, or restrictions thereof,
if any, of each such series may differ from those of any and all other series
of Preferred Stock at any time outstanding, and the Board of Directors is
hereby expressly granted authority to fix or alter, by resolution or
resolutions, the designation, number, voting powers, preferences, and
relative, participating, optional, and other special rights, and the
qualifications, limitations, and restrictions thereof, of each such series.
C. The corporation hereby designates 1,000,000 shares of Preferred Stock
as Series A Preferred Stock, which shares shall have the following rights,
powers, privileges, preferences, designations and limitations:
1. Designation and Rank.
The Series A Preferred Stock shall rank prior to the Common Stock and to all
other classes and series of equity securities of the corporation now or
hereafter authorized, issued or outstanding (such other classes and series of
equity securities collectively may be referred to herein as the "Junior
Stock"), other than any classes or series of equity securities of the
corporation ranking on a parity with (the "Parity Stock") or senior to (the
"Senior Stock") the Series A Preferred Stock as to dividend rights and rights
upon liquidation, winding up or dissolution of the corporation. The Series A
Preferred Stock shall be junior to all outstanding debt of the corporation.
The Series A Preferred Stock shall be subject to creation of Senior Stock,
Parity Stock and Junior Stock to the extent not expressly prohibited herein,
and the provisions hereof.
2. Dividends.
a. The holders of record of shares of the Series A Preferred Stock shall
be entitled to receive, when, as and if declared by the Board of Directors of
the corporation, out of any funds of the corporation legally available
therefor, cumulative cash dividends ("Dividends") at the per annum rates set
forth below, which shall accrue from December 31, 1995, and be payable
quarterly in arrears on the last day of March, June, September and December,
in each year, commencing March 31, 1996, or, if such day is a non-business
day, on the next business day, without interest (each of such dates, a
"Dividend Payment Date").
January 1, 1996 - December 31, 1996 12%
January 1, 1997 - December 31, 1997 13%
January 1, 1998 - December 31, 1998 14%
January 1, 1999 - December 31, 1999 15%
January 1, 2000 - December 31, 2000 16%
January 1, 2001 - December 31, 2001 17%
January 1, 2002 and thereafter 18%
Each declared Dividend shall be payable to holders of record as they appear on
the stock books of the corporation at the close of business on the applicable
record date, which shall be not more than 30 nor less than 10 calendar days
preceding the Dividend Payment Date therefor, as determined by the Board or a
duly authorized committee thereof (each of such dates, a "Record Date").
Dividends on each share of Series A Preferred Stock shall accrue and be
cumulative from the date of issuance thereof, whether or not there shall be
profits, surplus or other funds of the corporation legally available for the
payment of such Dividends at the time such Dividends shall accrue or become
due and whether or not such Dividends are declared. Accrued and unpaid
Dividends for any prior Dividend periods may be declared and paid at any time,
without reference to any regular Dividend Payment Date, to holders of record
on such date, not exceeding 45 days preceding the payment date thereof, as may
be fixed by the Board.
b. Unless full Dividends on the Series A Preferred Stock at the rates set
forth in paragraph C.2a above shall have been paid or declared and a sum
sufficient for the payment thereof set apart: (i) no dividend whatsoever
shall be paid or declared, and no distribution shall be made, on any Common
Stock or any other Junior Stock and (ii) no Common Stock shall be purchased,
redeemed or acquired by the corporation and no monies shall be paid into or
set aside or made available for a sinking fund for the purchase, redemption or
acquisition thereof; provided, however, that this restriction shall not apply
to the repurchase of shares of Common Stock or any other Junior Stock from
directors, officers or employees of the corporation pursuant to agreements
under which the corporation has the option to repurchase such shares upon the
occurrence of certain events, including the termination of employment.
3. Liquidation Preference.
a. In the event of any liquidation, dissolution or winding up of the
corporation, either voluntarily or involuntarily, the holders of Series A
Preferred Stock shall be entitled to receive, prior and in preference to any
distribution of any of the assets or surplus funds of the corporation to the
holders of Common Stock of the corporation or any other Junior Stock, an
amount equal to the Issuance Price for each share of Series A Preferred Stock
plus all Dividends due and not paid on such shares (the "Liquidation
Payment"). If upon such liquidation, dissolution or winding up of the
corporation the assets of the corporation are insufficient to pay the
Liquidation Payment in full on each share of Series A Preferred Stock, then
such assets as are available for distribution to the holders of the Series A
Preferred Stock shall be distributed ratably among such holders. Unless
specifically designated as Junior Stock or Senior Stock with respect to the
distribution of assets, all other series or classes of Preferred Stock shall
rank on a parity with the Series A Preferred Stock with respect to the
distribution of assets. All of the preferential amounts to be paid to the
holders of the Series A Preferred Stock and any Parity Stock under this
paragraph shall be paid or set apart for payment before the payment or setting
apart for payment of any amount for or the distribution of any assets of the
corporation to the holders of the Common Stock in connection with such
liquidation, dissolution or winding up.
b. A consolidation or merger of the corporation with or into any other
corporation where less than 50% of the outstanding voting securities of the
surviving corporation are held by the shareholders of the corporation existing
immediately prior to the consolidation or merger or a sale of all or
substantially all of the assets of the corporation, shall be deemed to be a
liquidation, dissolution or winding up of the corporation within the meaning
of this paragraph C.3.
4. Voting Rights.
a. Except as provided in C.4.b. below, or as otherwise from time to time
required by applicable law, the shares of Series A Preferred Stock shall not
entitle the holder thereof to any voting rights in the corporation.
b. The approval of 66 2/3% of the outstanding shares of the Series A
Preferred Stock, voting separately as a class, shall be required to authorize
any action of the corporation which (i) changes the rights, preferences or
privileges of the shares of the Series A Preferred Stock, or (ii) creates any
new class of stock having preference over or being on a parity with the shares
of the Series A Preferred Stock as to distributions upon the liquidation,
winding up or dissolution of the corporation. If Dividends for an entire
calendar year have not been declared and paid within 30 days after the end of
the calendar year, then until said Dividends are paid, holders of Series A
Preferred Stock shall be entitled to vote in the election of members of the
Board of Directors of the corporation. In such event, each share of Series A
Preferred Stock shall entitle the holder thereof to ten votes in the election
of members of the Board of Directors and said votes may be cumulated in
accordance with applicable law. At any time that holders of Series A
Preferred Stock are entitled to vote in the election of members of the Board
of Directors, the holders of 25% of the outstanding shares of the interest of
Series A Preferred Stock may call a special meeting of the Board of Directors
in accordance with the Bylaws of the corporation.
5. Right of Redemption. The corporation shall have the right to redeem
the Series A Preferred Stock, in whole or in part, from time to time at any
time, except as otherwise prohibited by law, at the Issuance Price per share,
plus an amount equal to all accrued and unpaid Dividends (whether or not any
such Dividend has been declared, but without interest thereon) to the date
such payment is made available in full to holder of shares of Series A
Preferred Stock (the "Redemption Price"). If fewer than all of the shares of
Series A Preferred Stock are to be redeemed at any time, selection of shares
for redemption shall be made by the Board of Directors of the corporation on a
pro rata basis or in such other equitable manner as the Board shall determine.
The corporation shall cause a notice of the record date set by the Board of
Directors for the payment of the Redemption Price (the "Redemption Date") to
be mailed to the holders of the Series A Preferred Stock to be redeemed at
least 30 days prior to the Redemption Date. Following the Redemption Date,
unless this corporation defaults in payment the Redemption Price on the
Redemption Date, the holders of the shares of Series A Preferred Stock called
for redemption shall cease to have any rights as stockholders of the
corporation with respect to such shares called for redemption except the right
to receive the Redemption Price upon surrender of the certificate or
certificates representing the shares of Series A Preferred Stock called for
redemption, endorsed for transfer to the corporation, and such shares shall
not be deemed to be outstanding for any purpose whatsoever.
6. Transfer. The corporation shall keep a register in which the
corporation shall register the transfer of any shares of Series A Preferred
Stock. Upon presentment for registration of transfer of a certificate
representing shares of Series A Preferred Stock (accompanied by such stock
assignments or stock powers as the corporation may require), the corporation
shall cancel such certificate and shall execute and issue to the transferor
and/or transferee new certificates aggregating a number of shares of Series A
Preferred Stock as is equal to the number represented by the canceled
certificate.
ARTICLE SIX
The power to adopt, amend, and repeal any or all of the Bylaws of the
corporation is reserved to the Board of Directors of the corporation.
ARTICLE SEVEN
Election of members to the Board of Directors need not be by written ballot
unless the Bylaws of the corporation shall so provide.
Meetings of the stockholders of the corporation may be held within or without
the State of Delaware, as the Bylaws may provide. The books of the
corporation may be kept (subject to any provision contained in the Delaware
General corporation Law) 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
Bylaws of the corporation.
ARTICLE EIGHT
A director of the corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its stockholders; (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; (iii) under Section 174 of the Delaware General
Corporation Law; or (iv) for any transaction from which the director derived
an improper personal benefit. If the Delaware General Corporation Law is
amended 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 Delaware General Corporation Law, as so amended. Any repeal or
modification of this provision shall not adversely affect any right or
protection of a director of the corporation existing at the time of such
repeal or modification. The limitation of liability provided herein shall
continue after a director has ceased to occupy such position as to acts or
omissions occurring during such director's term of terms of office.
ARTICLE NINE
A. The corporation shall to the fullest extent authorized by the Delaware
General Corporation Law, as the same exists or may hereafter be amended (but,
in the case of any such amendment, only to the extent that such amendment
permits the corporation to provide broader indemnification rights than such
law permitted the corporation to provide prior to such amendment), indemnify
and hold harmless any person who was or is a party, or is threatened to be
made a party to or is otherwise involved in any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative by reason of the fact that such person is or was a director
or officer of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including service with
respect to an employee benefit plan (hereinafter an "Indemnitee") against
expenses, liabilities and losses (including attorneys' fees, judgments, fines,
excise taxes or penalties paid in connection with the Employee Retirement
Income Security Act of 1974, as amended, and amounts paid in settlement)
reasonably incurred or suffered by such Indemnitee in connection therewith;
provided, however, that except as provided in this section with respect to
proceedings to enforce rights to indemnification, the corporation shall
indemnify any such Indemnitee in connection with a proceeding (or part
thereof) initiated by such Indemnitee only if such proceeding or part thereof
was authorized by the board of directors of this corporation.
B. The right to indemnification conferred in this section shall include
the right to be paid by the corporation the expenses (including attorneys'
fees) incurred in defending any such proceeding in advance of its final
disposition; provided, however, that, if the Delaware General Corporation Law
requires, an advancement of expenses incurred by an Indemnitee in his capacity
as a director or officer (and not in any other capacity in which service was
or is rendered by such Indemnitee, including, without limitation, service to
an employee benefit plan) shall be made only upon delivery to the corporation
of an undertaking, by or on behalf of such Indemnitee, to repay all amounts so
advanced if it shall ultimately be determined by final judicial decision from
which there is not further right to appeal that such Indemnitee is not
entitled to be indemnified for such expenses under this section or otherwise.
The rights to indemnification and to the advancement of expenses conferred in
this section shall be contract rights and such rights shall continue as to an
Indemnitee who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of the Indemnitee's heirs, executors and
administrators.
C. If a claim under the two preceding paragraphs of this section is not
paid in full by the corporation within sixty (60) days after a written claim
has been received by the corporation, except in the case of a claim for an
advancement of expenses, in which case the applicable period shall be twenty
(20) days, the Indemnitee may at any time thereafter bring suit against the
corporation to recover the unpaid amount of the claim. If successful in whole
or in part in any such suit, or in a suit brought by the corporation to
recover an advancement of expenses pursuant to the terms of an undertaking,
the Indemnitee shall be entitled to be paid also the expense of prosecuting or
defending such suit. In (i) any suit brought by the Indemnitee to enforce a
right to indemnification hereunder (but not in a suit brought by the
Indemnitee to enforce a right to an advancement of expenses) and (ii) in any
suit brought by the corporation to recover an advancement of expenses pursuant
to the terms of an undertaking, the corporation shall be entitled to recover
such expenses upon a final adjudication that the Indemnitee has not met any
applicable standard for indemnification set forth in the Delaware General
Corporation Law. Neither the failure of the corporation (including its board
of directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such suit that indemnification of
the Indemnitee is proper in the circumstances because the Indemnitee has met
the applicable standard of conduct set forth in the Delaware General
Corporation Law, nor an actual determination by the corporation (including its
board of directors, independent legal counsel, or its stockholders) that the
Indemnitee has not met such applicable standard of conduct, shall create a
presumption that the Indemnitee has not met the applicable standard of conduct
or, in the case of such a suit brought by the Indemnitee, be a defense to such
suit. In any suit brought by the Indemnitee to enforce a right to
indemnification or to an advancement of expenses hereunder, or brought by the
corporation to recover an advancement of expenses pursuant to the terms of an
undertaking, the burden of proving that the Indemnitee is not entitled to be
indemnified, or to such advancement of expenses under this section or
otherwise shall be on the corporation.
D. The rights to indemnification and advancement of expenses conferred in
this section shall not be exclusive of any other rights which any person may
have or hereafter acquire under any statute, the corporation's certificate of
incorporation, as it may be amended or restated from time-to-time, any
agreement, vote of stockholders or disinterested directors, or otherwise. No
amendment or repeal of this Article Eight shall apply to or have any effect on
any right to indemnification provided hereunder with respect to any acts or
omissions occurring prior to such amendment or repeal.
E. The corporation shall have the power to purchase and maintain
insurance, at its expense, to protect itself and any director, officer,
employee or agent of the corporation or another corporation, partnership,
joint venture, trust or other enterprise (including an employee benefit plan)
against any expense, liability or loss, whether or not the corporation would
have the power to indemnify such person against such expense, liability or
loss under the Delaware General Corporation Law. The corporation may also
create a trust fund, grant a security interest and/or use other means
(including, but not limited to letters of credit, surety bonds and/or similar
arrangements), as well as enter into contracts providing indemnification to
the full extent authorized or permitted by law and including as part thereof
provisions with respect to any or all of the foregoing, to ensure the payment
of such amounts as may become necessary to effect indemnification as provided
therein, or elsewhere.
F. For purposes of this section, references to the "corporation" shall
include any subsidiary of this corporation from and after the acquisition
thereof by this corporation, so that any person who is a director, officer,
employee or agent of such subsidiary after the acquisition thereof by this
corporation shall stand in the same position under the provisions of this
section as such person would have had such person served in such position for
this corporation.
G. The corporation may, to the extent authorized from time to time by the
board of directors, grant rights to indemnification and to the advancement of
expenses to any employee or agent of the corporation to the fullest extent of
the provisions of this section with respect to the indemnification and
advancement of expenses of directors and officers of the corporation.
ARTICLE TEN
The name and mailing address of the incorporator is Steven P. Johnson, 2525
East Camelback Road, Phoenix, Arizona 85016.
ARTICLE ELEVEN
The number of directors constituting the initial Board of Directors of the
corporation is one (1). The size of the Board of Directors may be increased
or decreased in the manner provided in the Bylaws of the corporation. All
corporate powers of the corporation shall be exercised by or under the
direction of the Board of Directors except as otherwise provided herein or by
law. The name and address of the persons who are to serve as directors until
the first annual meeting of stockholders or until their successors are elected
and qualified are:
Name Address
- ---------------------- -----------------------------------
Ernest C. Garcia, II 2525 East Camelback Road, Suite 510
Phoenix, Arizona 85016
ARTICLE TWELVE
Subject to any conditions imposed by law, the corporation expressly denies the
application of the Arizona Corporate Takeover Laws, Arizona Revised Statutes
10-2701 et seq., or any successor thereto.
ARTICLE THIRTEEN
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 by the Delaware General corporation Law.
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