EXHIBIT 3.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
NOOSH, INC.
Ofer Ben-Shachar and Timothy J. Moore hereby certify that:
ONE: The original name of this corporation is NOOSH Merger Corporation
and the date of filing the original Certificate of Incorporation of this
corporation with the Secretary of State of the State of Delaware is January 28,
2000.
TWO: They are the duly elected and acting President and Secretary,
respectively, of NOOSH, Inc., a Delaware corporation.
THREE: The Certificate of Incorporation of this corporation is hereby
amended and restated to read as follows:
"I.
The name of the Corporation is NOOSH, Inc. (the "Corporation").
II.
The address of the registered office of the Corporation in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, City of Wilmington,
County of New Castle, and the name of the registered agent of the corporation in
the State of Delaware at such address is the CT Corporation System.
III.
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
the State of Delaware ("DGCL").
IV.
A. This Corporation is authorized to issue three classes of stock to be
designated, respectively, "Common Stock," "Class B Common Stock" and "Preferred
Stock."
B. The total number of shares which the Corporation is authorized to
issue is ninety-four million four hundred thousand (94,400,000) shares, seventy-
five million (75,000,000) shares of which shall be Common Stock (the "Common
Stock"), sixteen million eight hundred thousand (16,800,000) shares of which
shall be Preferred Stock (the "Preferred Stock") and two million six hundred
thousand (2,600,000) shares of which shall be Class B Common Stock (the "Class B
Common Stock"). The Common Stock and the Class B Common shall, together,
hereinafter be referred to as the "Common Shares." The Preferred Stock shall
have a par value of
1.
one tenth of one cent ($0.001) per share, the Common Stock shall have a par
value of one tenth of one cent ($0.001) per share and the Class B Common Stock
shall have a par value of one tenth of one cent ($0.001) per share.
C. Two million twenty three thousand seventy seven (2,023,077) of the
authorized shares of Preferred Stock are hereby designated "Series A Preferred
Stock" (the "Series A Preferred"). Four million three hundred sixty three
thousand six hundred thirty seven (4,363,637) of the authorized shares of
Preferred Stock are hereby designated "Series B Preferred Stock" (the "Series B
Preferred"). Six million eight hundred nine thousand one hundred thirty-five
(6,809,135) of the authorized shares of Preferred Stock are hereby designated
"Series C Preferred Stock" (the "Series C Preferred"). Two million (2,000,000)
of the authorized shares of Preferred Stock are hereby designated "Series D
Preferred Stock" (the "Series D Preferred"). Eight hundred thousand (800,000)
of the authorized shares of Preferred Stock are hereby designated "Series E
Preferred Stock" (the "Series E Preferred"). Eight hundred thousand (800,000)
of the authorized shares of Preferred Stock are hereby designated "Series E-1
Preferred Stock" (the "Series E-1 Preferred").
D. Preferred Stock. The rights, preferences, privileges, restrictions
and other matters relating to the Series A Preferred, Series B Preferred, Series
C Preferred, Series D Preferred, Series E Preferred and Series E-1 Preferred
(together, the "Series Preferred") are as follows:
1. Dividend Rights.
a. Holders of Series Preferred, in preference to the holders of
any other stock of the Corporation ("Junior Stock"), shall be entitled to
receive on a pro rata basis, when and as declared by the Board of Directors, but
only out of funds that are legally available therefor, cash dividends at the
rate of eight percent (8%) of the "Original Issue Price" per annum on each
outstanding share of Series Preferred (as adjusted for any stock dividends,
combinations, splits, recapitalizations and the like with respect to such
shares). The Original Issue Price of the Series A Preferred shall be Sixty-Five
Cents ($0.65) (the "Series A Original Issue Price"). The Original Issue Price
of the Series B Preferred shall be Two Dollars and Seventy-Five Cents ($2.75)
(the "Series B Original Issue Price"). The Original Issue Price of the Series C
Preferred shall be Seven Dollars and Forty-Five Cents ($7.45) (the "Series C
Original Issue Price"). The Original Issue Price of the Series D Preferred
shall be Eleven Dollars ($11.00) (the "Series D Original Issue Price"). The
Original Issue Price of the Series E Preferred shall be Thirteen Dollars
($13.00) (the "Series E Original Issue Price"). The Original Issue Price of the
Series E-1 Preferred shall be Thirteen Dollars ($13.00) (the "Series E-1
Original Issue Price"). Such dividends shall be payable only when, as and if
declared by the Board of Directors and shall be non-cumulative.
b. So long as any shares of Series Preferred shall be
outstanding, no dividend, whether in cash or property, shall be paid or
declared, nor shall any other distribution be made, on any Junior Stock, nor
shall any shares of any Junior Stock of the Corporation be purchased, redeemed,
or otherwise acquired for value by the Corporation (except for acquisitions of
Common Stock by the Corporation pursuant to agreements which permit the
Corporation to repurchase such shares upon termination of services to the
Corporation or in exercise of the
2.
Corporation's right of first refusal upon a proposed transfer) until all
dividends (set forth in Section 1a above) on the Series Preferred shall have
been paid or declared and set apart. In the event dividends are paid on any
share of Junior Stock, an additional dividend shall be paid with respect to all
outstanding shares of Series Preferred in an amount equal per share (on an
as-if-converted to Common Stock basis) to the amount paid or set aside for each
share of Junior Stock. The provisions of this Section 1b shall not, however,
apply to (i) a dividend payable in Junior Stock, or (ii) the acquisition of
shares of any Junior Stock in exchange for shares of any other Junior Stock. The
holders of the Series Preferred expressly waive their rights, if any, as
described in California Corporations Code Sections 502, 503 and 506 as they
relate to repurchase of shares upon termination of employment or service as a
consultant or director.
2. Voting Rights.
a. General Rights. Subject to Sections 2b, 2c and 2d and the
last sentence of this Section 2a, and except as otherwise provided herein or as
required by law, the Series Preferred shall be voted equally with the shares of
the Common Stock of the Corporation and not as a separate class, at any annual
or special meeting of stockholders of the Corporation, and may act by written
consent in the same manner as the Common Stock, in either case upon the
following basis: each holder of shares of Series Preferred shall be entitled to
such number of votes as shall be equal to the whole number of shares of Common
Stock into which such holder's aggregate number of shares of Series Preferred
are convertible (pursuant to Section 5 hereof) immediately after the close of
business on the record date fixed for such meeting or the effective date of such
written consent. Except as required by law or as otherwise set forth herein,
holders of Series E Preferred Stock shall not be entitled to vote for the
election of directors or to vote on any other matter.
b. Separate Vote of Series Preferred. For so long as at least
seven million (7,000,000) shares of Series Preferred (subject to adjustment for
any stock split, reverse stock split or other similar event affecting the Series
Preferred) remain outstanding, in addition to any other vote or consent required
herein or by law, the vote or written consent of the holders of at least sixty-
six and two-thirds percent (66-2/3%) of the outstanding Series Preferred (voting
on an as-if-converted basis as a single class) shall be necessary for effecting
or validating the following actions:
(i) Any amendment, alteration, or repeal of any provision
of the Certificate of Incorporation or the Bylaws of the Corporation (including
any filing of a Certificate of Determination) that affects adversely the voting
powers, preferences, or other special rights or privileges, qualifications,
limitations, or restrictions of any series of the Series Preferred;
(ii) Any authorization or any designation, whether by
reclassification or otherwise, of any new class or series of stock or any other
securities convertible into equity securities of the Corporation ranking senior
to or on parity with any series of the Series Preferred in rights of redemption,
liquidation preference, voting or dividends or any increase in the authorized or
designated number of any such new class or series;
3.
(iii) Any redemption, repurchase, payment of dividends or
other distributions with respect to Junior Stock (except for acquisitions of
Common Stock by the Corporation pursuant to agreements which permit the
Corporation to repurchase such shares upon termination of services to the
Corporation or in exercise of the Corporation's right of first refusal upon a
proposed transfer);
(iv) Any action that results in the payment or declaration
of a dividend on any shares of Junior Stock;
(v) Any agreement by the Corporation or its stockholders
regarding an Asset Transfer or Acquisition (each as defined in Section 3c);
(vi) Any increase or decrease in the authorized number of
shares of the Series A Preferred, Series B Preferred, Series C Preferred, Series
D Preferred, Series E Preferred or Series E-1 Preferred; or
(vii) Any issuance of shares of Series D Preferred, whether
directly or indirectly, that would result in more than 1,500,000 shares of
Series D Preferred being outstanding unless such issuance of shares occurs in
connection with (a) a merger, consolidation, acquisition or similar business
combination approved by the Board of Directors, (b) any equipment leasing
arrangement, or debt financing from a bank or similar financial institution
approved by the Board of Directors, or (c) any strategic transactions involving
the Corporation and other entities, including joint ventures, manufacturing,
marketing or distribution arrangements, and technology transfer or development
arrangements approved by the Board of Directors.
c. Separate Vote of Series C Preferred. For so long as at least
three million five hundred thousand (3,500,000) shares of Series C Preferred
(subject to adjustment for any stock split, reverse stock split or other similar
event affecting the Series C Preferred) remain outstanding, in addition to any
other vote or consent required herein or by law, the vote or written consent of
the holders of at least a majority of the outstanding Series C Preferred shall
be necessary for effecting or validating the following actions:
(i) Any amendment, alteration, or repeal of any provision
of the Certificate of Incorporation or the Bylaws of the Corporation (including
any filing of a Certificate of Determination) that alters or changes the voting
powers, preferences, or other special rights or privileges, qualifications,
limitations, or restrictions of the Series C Preferred;
(ii) Any increase or decrease in the authorized number of
shares of the Series C Preferred; or
(iii) Any agreement by the Corporation or its stockholders
regarding an Asset Transfer or Acquisition (each as defined in Section 3c) in
which the value of the proceeds received by the Series C Preferred is an amount
per share of Series C Preferred less than the product obtained by multiplying
two by the Series C Original Issue Price (as adjusted for any stock dividends,
combinations, splits, recapitalizations and the like with respect to such
shares).
4.
d. Election of Board of Directors. For so long as at least
three million (3,000,000) shares of Series A Preferred and Series B Preferred
remain outstanding (subject to adjustment for any stock split, reverse stock
split or similar event affecting the Series Preferred), (i) the holders of
Series A Preferred, voting as a separate class, shall be entitled to elect one
(1) member of the Corporation's Board of Directors at each meeting or pursuant
to each consent of the Corporation's stockholders for the election of directors,
and to remove from office such director and to fill any vacancy caused by the
resignation, death or removal of such director; (ii) the holders of Series B
Preferred, voting as a separate class, shall be entitled to elect one (1) member
of the Corporation's Board of Directors at each meeting or pursuant to each
consent of the Corporation's stockholders for the election of directors, and to
remove from office such director and to fill any vacancy caused by the
resignation, death or removal of such director; (iii) the holders of Common
Stock, voting as a separate class, shall be entitled to elect one (1) member of
the Board of Directors at each meeting or pursuant to each consent of the
Corporation's stockholders for the election of directors, and to remove from
office such director and to fill any vacancy caused by the resignation, death or
removal of such director; and (iv) the holders of Common Stock and Series
Preferred, voting together as a single class on an as-if-converted basis, shall
be entitled to elect all remaining members of the Board of Directors at each
meeting or pursuant to each consent of the Corporation's stockholders for the
election of directors, and to remove from office such directors and to fill any
vacancy caused by the resignation, death or removal of such directors.
3. Liquidation Rights.
a. Upon any liquidation, dissolution, or winding up of the
Corporation, whether voluntary or involuntary, before any distribution or
payment shall be made to the holders of any Junior Stock, (i) the holders of
Series A Preferred shall be entitled to be paid out of the assets of the
Corporation an amount per share of Series A Preferred equal to the Series A
Original Issue Price plus all declared and unpaid dividends on such shares of
Series A Preferred (as adjusted for any stock dividends, combinations, splits,
recapitalizations and the like with respect to such shares) for each share of
Series A Preferred held by them, (ii) the holders of Series B Preferred shall be
entitled to be paid out of the assets of the Corporation an amount per share of
Series B Preferred equal to the Series B Original Issue Price plus all declared
and unpaid dividends on such shares of Series B Preferred (as adjusted for any
stock dividends, combinations, splits, recapitalizations and the like with
respect to such shares) for each share of Series B Preferred held by them, (iii)
the holders of Series C Preferred shall be entitled to be paid out of the assets
of the Corporation an amount per share of Series C Preferred equal to the Series
C Original Issue Price plus all declared and unpaid dividends on such shares of
Series C Preferred (as adjusted for any stock dividends, combinations, splits,
recapitalizations and the like with respect to such shares) for each share of
Series C Preferred held by them, (iv) the holders of Series D Preferred shall be
entitled to be paid out of the assets of the Corporation an amount per share of
Series D Preferred equal to the Series D Original Issue Price plus all declared
and unpaid dividends on such shares of Series D Preferred (as adjusted for any
stock dividends, combinations, splits, recapitalizations and the like with
respect to such shares) for each share of Series D Preferred held by them, (v)
the holders of Series E Preferred shall be entitled to be paid out of the assets
of the Corporation an amount per share of Series E Preferred equal to the Series
E Original Issue Price plus all declared and unpaid dividends on such shares of
Series E Preferred (as adjusted for any stock dividends, combinations, splits,
recapitalizations and the like
5.
with respect to such shares) for each share of Series E Preferred held by them,
and (vi) the holders of Series E-1 Preferred shall be entitled to be paid out of
the assets of the Corporation an amount per share of Series E-1 Preferred equal
to the Series E-1 Original Issue Price plus all declared and unpaid dividends on
such shares of Series E-1 Preferred (as adjusted for any stock dividends,
combinations, splits, recapitalizations and the like with respect to such
shares) for each share of Series E-1 Preferred held by them.
b. After the payment of the full liquidation preference of the
Series Preferred as set forth in Section 3a above, the assets of the Corporation
legally available for distribution, if any, shall be distributed ratably to the
holders of the Common Shares.
c. The following events shall be considered a liquidation under
this Section:
(i) any consolidation or merger of the Corporation with or
into any other corporation or other entity or person, or any other corporate
reorganization, in which the stockholders of the Corporation immediately prior
to such consolidation, merger or reorganization, as a result of their ownership
of the Corporation's securities own less than 50% of the surviving corporation's
voting power immediately after such consolidation, merger or reorganization (an
"Acquisition"); or
(ii) a sale, lease or other disposition of all or
substantially all of the assets of the Corporation (an "Asset Transfer").
d. If, upon any liquidation, distribution, or winding up of the
Corporation, the assets of the Corporation shall be insufficient to make payment
in full to all holders of Series Preferred of the liquidation preference set
forth in Section 3a, then such assets shall be distributed among the holders of
Series Preferred at the time outstanding, ratably in proportion to the full
amounts to which they would otherwise be respectively entitled.
4. Redemption.
The Series Preferred shall not be redeemable by the Corporation.
5. Conversion Rights.
The holders of the Series Preferred shall have the following rights with
respect to the conversion of the Series Preferred into shares of Common Shares
(the "Conversion Rights"):
a. Optional Conversion.
(i) Subject to and in compliance with the provisions of
this Section 5, each share of Series A Preferred, Series B Preferred, Series C
Preferred, Series D Preferred and Series E-1 Preferred may, at the option of the
holder, be converted at any time into fully-paid and nonassessable shares of
Common Stock. The number of shares of Common Stock to which a holder of such
shares shall be entitled upon conversion shall be the product obtained by
multiplying the "Series A Preferred Conversion Rate", "Series B Preferred
Conversion Rate", "Series C Preferred Conversion Rate", "Series D Preferred
Conversion Rate" or "Series E-1
6.
Conversion Rate", as applicable, then in effect (determined as provided in
Section 5b) by the number of shares of Series A Preferred, Series B Preferred,
Series C Preferred, Series D Preferred or Series E-1 Preferred, as applicable,
being converted.
(ii) Subject to and in compliance with the provisions of
this Section 5, each share of Series E Preferred shall be convertible, at the
option of the holder thereof, at any time beginning upon the earlier of (A) the
date one year after the date on which any share of Series E Preferred was first
issued (the "Original Series E Issuance Date") or (B) the date of the
Corporation's written consent to such conversion, which written consent will not
be unreasonably withheld or delayed, into one fully paid and nonassessable share
of Series E-1 Preferred Stock.
(iii) Subject to and in compliance with the provisions of
this Section 5, each share of Series E Preferred shall be convertible, at the
option of the holder thereof, at any time, into such number of fully paid and
nonassessable shares of Class B Common Stock as is determined by multiplying the
"Series E Preferred Conversion Rate" then in effect (determined as provided in
Section 5b) by the number of shares of Series E Preferred being converted.
(iv) Subject to and in compliance with the provisions of
this Section 5, each share of Class B Common Stock shall be convertible, at the
option of the holder thereof, at any time beginning upon the earlier of (A) the
date one year after the Original Series E Issuance Date, (B) the date 180 days
after an Initial Public Offering (as defined in Section B.1 of Article V) or (C)
the date of the Corporation's written consent to such conversion, which written
consent will not be unreasonably withheld or delayed, into one fully paid and
nonassessable share of Common Stock.
b. Series Preferred Conversion Rate. The conversion rate in
effect at any time for conversion of each of the Series A Preferred (the "Series
A Preferred Conversion Rate"), the Series B Preferred (the "Series B Preferred
Conversion Rate"), the Series C Preferred (the "Series C Preferred Conversion
Rate"), the Series D Preferred (the "Series D Preferred Conversion Rate"), the
Series E Preferred (the "Series E Preferred Conversion Rate") and the Series E-1
Preferred (the "Series E-1 Preferred Conversion Rate") shall be the quotient
obtained by dividing the Series A Original Issue Price, the Series B Original
Issue Price, the Series C Original Issue Price, the Series D Original Issue
Price, the Series E Original Issue Price and the Series E-1 Original Issue Price
of the Series A Preferred, the Series B Preferred, the Series C Preferred, the
Series D Preferred, the Series E Preferred and the Series E-1 Preferred,
respectively, by the "Series A Preferred Conversion Price", the "Series B
Preferred Conversion Price," the "Series C Preferred Conversion Price," the
"Series D Preferred Conversion Price," the "Series E Preferred Conversion Price"
and the "Series E-1 Preferred Conversion Price," respectively, calculated as
provided in Section 5c.
c. Series Preferred Conversion Price. As of the date of filing
of this Amended and Restated Certificate of Incorporation (the "Filing Date"),
the conversion price for the Series A Preferred shall be $0.325 (the "Series A
Preferred Conversion Price"), the conversion price for the Series B Preferred
shall be $1.375 (the "Series B Preferred Conversion Price"), the conversion
price for the Series C Preferred shall be the Series C Original Issue Price
7.
(the "Series C Preferred Conversion Price"), the conversion price for the Series
D Preferred shall be the Series D Original Issue Price (the "Series D Preferred
Conversion Price"), the conversion price for the Series E Preferred shall be the
Series E Original Issue Price (the "Series E Preferred Conversion Price") and
the conversion price for the Series E-1 Preferred shall be the Series E-1
Original Issue Price (the "Series E-1 Preferred Conversion Price"). Such Series
A Preferred Conversion Price, Series B Preferred Conversion Price, Series C
Preferred Conversion Price, Series D Preferred Conversion Price, Series E
Preferred Conversion Price and Series E-1 Preferred Conversion shall be adjusted
from time to time in accordance with this Section 5. All references to the
Series A Preferred Conversion Price, Series B Preferred Conversion Price, Series
C Preferred Conversion Price, Series D Preferred Conversion Price, Series E
Preferred Conversion Price and Series E-1 Preferred Conversion herein shall mean
the Series A Preferred Conversion Price, Series B Preferred Conversion Price,
Series C Preferred Conversion Price, Series D Preferred Conversion Price, Series
E Preferred Conversion Price and Series E-1 Preferred Conversion Price,
respectively, as so adjusted after the Filing Date.
d. Mechanics of Conversion. Each holder of Series Preferred or
Class B Common Stock who desires to convert the same into shares of Common Stock
or, for holders of Series E Preferred Stock, into shares of Series E-1 Preferred
Stock or Class B Common Stock pursuant to this Section 5 shall surrender the
certificate or certificates therefor, duly endorsed, at the office of the
Corporation or any transfer agent for the Series Preferred or Class B Common
Stock, and shall give written notice to the Corporation at such office that such
holder elects to convert the same. Such notice shall state the number of shares
being converted. Thereupon, the Corporation shall promptly issue and deliver at
such office to such holder a certificate or certificates for the number of
shares of Common Stock, Class B Common Stock or Series E-1 Preferred Stock to
which such holder is entitled and shall promptly pay in cash or, to the extent
sufficient funds are not then legally available therefor, in Common Stock, Class
B Common Stock, or Series E-1 Preferred Stock, as applicable (at the fair market
value for such shares as determined by the Board of Directors as of the date of
such conversion), any declared and unpaid dividends on the shares being
converted. Such conversion shall be deemed to have been made at the close of
business on the date of such surrender of the certificates representing the
shares to be converted, and the person entitled to receive the shares of Common
Stock, Class B Common Stock or Series E-1 Preferred Stock issuable, as
applicable, upon such conversion shall be treated for all purposes as the record
holder of such shares, as applicable, on such date.
e. Adjustment for Stock Splits and Combinations. If the
Corporation shall at any time or from time to time after the Filing Date effect
a subdivision of the outstanding Common Stock without a corresponding
subdivision of the Series Preferred, the Series A Preferred Conversion Price,
the Series B Preferred Conversion Price, the Series C Preferred Conversion
Price, the Series D Preferred Conversion Price, the Series E Preferred
Conversion Price and the Series E-1 Preferred Conversion Price in effect
immediately before that subdivision shall be proportionately decreased.
Conversely, if the Corporation shall at any time or from time to time after the
Filing Date combine the outstanding shares of Common Stock into a smaller number
of shares without a corresponding combination of the Series Preferred, the
Series A Preferred Conversion Price, the Series B Preferred Conversion Price,
the Series C Preferred Conversion Price, the Series D Preferred Conversion
Price, the Series E Preferred Conversion Price and the Series E-1 Preferred
Conversion Price in effect immediately before the combination shall be
proportionately increased. Any adjustment under this Section 5e shall
8.
become effective at the close of business on the date the subdivision or
combination becomes effective.
f. Adjustment for Common Stock Dividends and Distributions. If
the Corporation at any time or from time to time after the Filing Date makes, 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, in each such event the Series A Preferred Conversion Price, Series B
Preferred Conversion Price, Series C Preferred Conversion Price, Series D
Preferred Conversion Price, Series E Preferred Conversion Price and Series E-1
Preferred Conversion Price that is then in effect shall be decreased as of the
time of such issuance or, in the event such record date is fixed, as of the
close of business on such record date, by multiplying the Series A Preferred
Conversion Price, Series B Preferred Conversion Price, Series C Preferred
Conversion Price, Series D Preferred Conversion Price, Series E Preferred
Conversion Price and Series E-1 Conversion Price then in effect by a fraction
(i) the numerator of which is 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, and (ii) the denominator of which is 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; provided, however, that if such record date is fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Series A Preferred Conversion Price, Series B Preferred
Conversion Price, Series C Preferred Conversion Price, Series D Preferred
Conversion Price, Series E Preferred Conversion Price and Series E-1 Preferred
Conversion Price shall be recomputed accordingly as of the close of business on
such record date and thereafter the Series A Preferred Conversion Price, the
Series B Preferred Conversion Price, the Series C Preferred Conversion Price,
Series D Preferred Conversion Price, Series E Preferred Conversion Price and
Series E-1 Preferred Conversion Price shall be adjusted pursuant to this Section
5f to reflect the actual payment of such dividend or distribution.
g. Adjustments for Other Dividends and Distributions. If the
Corporation at any time or from time to time after the Filing Date makes, or
fixes a record date for the determination of holders of Common Stock entitled to
receive, a dividend or other distribution payable in securities of the
Corporation other than shares of Common Stock, in each such event provision
shall be made so that the holders of the Series Preferred shall receive upon
conversion thereof, in addition to the number of shares of Common Stock
receivable thereupon, the amount of other securities of the Corporation which
they would have received had their Series Preferred been converted into Common
Stock on the date of such event and had they thereafter, during the period from
the date of such event to and including the conversion date, retained such
securities receivable by them as aforesaid during such period, subject to all
other adjustments called for during such period under this Section 5 with
respect to the rights of the holders of the Series Preferred or with respect to
such other securities by their terms.
h. Adjustment for Reclassification, Exchange and Substitution.
If at any time or from time to time after the Filing Date, the Common Stock
issuable upon the conversion of the Series Preferred is changed into the same or
a different number of shares of any class or classes of stock, whether by
recapitalization, reclassification or otherwise (other than an Acquisition or
Asset Transfer as defined in Section 3c or a subdivision or combination of
9.
shares or stock dividend or a reorganization, merger, consolidation or sale of
assets provided for elsewhere in this Section 5), in any such event each holder
of Series Preferred shall have the right thereafter to convert such stock into
the kind and amount of stock and other securities and property receivable upon
such recapitalization, reclassification or other change by holders of the
maximum number of shares of Common Stock into which such shares of Series
Preferred could have been converted immediately prior to such recapitalization,
reclassification or change, all subject to further adjustment as provided herein
or with respect to such other securities or property by the terms thereof.
i. Reorganizations, Mergers, Consolidations or Sales of Assets.
If at any time or from time to time after the Filing Date, there is a capital
reorganization of the Common Stock (other than an Acquisition or Asset Transfer
as defined in Section 3c or a recapitalization, subdivision, combination,
reclassification, exchange or substitution of shares provided for elsewhere in
this Section 5), as a part of such capital reorganization, provision shall be
made so that the holders of the Series Preferred shall thereafter be entitled to
receive upon conversion of the Series Preferred the number of shares of stock or
other securities or property of the Corporation to which a holder of the number
of shares of Common Stock deliverable upon conversion would have been entitled
on such capital reorganization, subject to adjustment in respect of such stock
or securities by the terms thereof. In any such case, appropriate adjustment
shall be made in the application of the provisions of this Section 5 with
respect to the rights of the holders of Series Preferred after the capital
reorganization to the end that the provisions of this Section 5 (including
adjustment of each Series Preferred Conversion Price then in effect and the
number of shares issuable upon conversion of the Series Preferred) shall be
applicable after that event and be as nearly equivalent as practicable.
j. Sale of Shares Below Series Preferred Conversion Price.
(i) If at any time or from time to time after the Filing
Date, the Corporation issues or sells, or is deemed by the express provisions of
this subsection 5j to have issued or sold, Additional Shares of Common Stock (as
defined in subsection 5j(iv) below), other than as a dividend or other
distribution on any class of stock as provided in Section 5f above, and other
than a subdivision or combination of shares of Common Stock as provided in
Section 5e above, for an Effective Price (as defined in subsection 5j(iv) below)
less than the then effective Series A Preferred Conversion Price, Series B
Preferred Conversion Price, Series C Preferred Conversion Price, Series D
Preferred Conversion Price, Series E Preferred Conversion Price or Series E-1
Preferred Conversion Price, then and in each such case the then existing Series
A Preferred Conversion Price, Series B Preferred Conversion Price, Series C
Preferred Conversion Price, Series D Preferred Conversion Price, Series E
Preferred Conversion Price or Series E-1 Preferred Conversion Price, as the case
may be, shall be reduced, as of the opening of business on the date of such
issue or sale, to a price determined by multiplying the Series A Preferred
Conversion Price, Series B Preferred Conversion Price, Series C Preferred
Conversion Price, Series D Preferred Conversion Price, Series E Preferred
Conversion Price or Series E-1 Preferred Conversion Price, as applicable, by a
fraction (i) the numerator of which shall be (A) the number of shares of Common
Stock deemed outstanding (as defined below) immediately prior to such issue or
sale, plus (B) the number of shares of Common Stock which the aggregate
consideration received (as defined in subsection 5j(ii)) by the Corporation for
the total number of Additional Shares of Common Stock so issued would purchase
at such Series A Preferred Conversion Price,
10.
Series B Preferred Conversion Price, Series C Preferred Conversion Price, Series
D Preferred Conversion Price, Series E Preferred Conversion Price or Series E-1
Preferred Conversion Price, as the case may be, and (ii) the denominator of
which shall be the number of shares of Common Stock deemed outstanding (as
defined below) immediately prior to such issue or sale plus the total number of
Additional Shares of Common Stock so issued. For the purposes of the preceding
sentence, the number of shares of Common Stock deemed to be outstanding as of a
given date shall be the sum of (A) the number of shares of Common Stock actually
outstanding, (B) the number of shares of Common Stock into which the then
outstanding shares of Series Preferred could be converted if fully converted as
of the time of such issuance, and (C) the number of shares of Common Stock which
could be obtained through the exercise or conversion of all other rights,
options and convertible securities outstanding as of the time of such issuance.
(ii) For the purpose of making any adjustment
required under this Section 5j, the consideration received by the Corporation
for any issue or sale of securities shall (A) to the extent it consists of cash,
be computed as the net amount of cash received by the Corporation after
deduction of any underwriting or similar commissions, compensation or
concessions paid or allowed by the Corporation in connection with such issue or
sale but without deduction of any expenses payable by the Corporation, (B) to
the extent it consists of property other than cash, be computed as the fair
value of that property as determined in good faith by the Board of Directors,
and (C) if Additional Shares of Common Stock, Convertible Securities (as defined
in subsection 5j(iii)) or rights or options to purchase either Additional Shares
of Common Stock or Convertible Securities are issued or sold together with other
stock or securities or other assets of the Corporation for a consideration which
covers both, be computed as the portion of the consideration so received that
may be reasonably determined in good faith by the Board of Directors to be
allocable to such Additional Shares of Common Stock, Convertible Securities or
rights or options.
(iii) For the purpose of the adjustment required under
this Section 5j, if the Corporation issues or sells (i) stock or other
securities convertible into, Additional Shares of Common Stock (such convertible
stock or securities being herein referred to as "Convertible Securities") or
(ii) rights or options for the purchase of Additional Shares of Common Stock or
Convertible Securities and if the Effective Price of such Additional Shares of
Common Stock is less than the Series A Preferred Conversion Price, Series B
Preferred Conversion Price, Series C Preferred Conversion Price, Series D
Preferred Conversion Price, Series E Preferred Conversion Price or Series E-1
Preferred Conversion Price, as the case may be, in each case the Corporation
shall be deemed to have issued at the time of the issuance of such rights or
options or Convertible Securities the maximum number of Additional Shares of
Common Stock issuable upon exercise or conversion thereof and to have received
as consideration for the issuance of such shares an amount equal to the total
amount of the consideration, if any, received by the Corporation for the
issuance of such rights or options or Convertible Securities, plus, in the case
of such rights or options, the minimum amounts of consideration, if any, payable
to the Corporation upon the exercise of such rights or options, plus, in the
case of Convertible Securities, the minimum amounts of consideration, if any,
payable to the Corporation (other than by cancellation of liabilities or
obligations evidenced by such Convertible Securities) upon the conversion
thereof; provided that if in the case of Convertible Securities the minimum
amounts of such consideration cannot be ascertained, but are a function of
antidilution or similar protective clauses, the Corporation shall be deemed to
11.
have received the minimum amounts of consideration without reference to such
clauses; provided further that if the minimum amount of consideration payable to
the Corporation upon the exercise or conversion of rights, options or
Convertible Securities is reduced over time or on the occurrence or non-
occurrence of specified events other than by reason of antidilution adjustments,
the Effective Price shall be recalculated using the figure to which such minimum
amount of consideration is reduced; provided further that if the minimum amount
of consideration payable to the Corporation upon the exercise or conversion of
such rights, options or Convertible Securities is subsequently increased, the
Effective Price shall be again recalculated using the increased minimum amount
of consideration payable to the Corporation upon the exercise or conversion of
such rights, options or Convertible Securities. No further adjustment of the
Series A Preferred Conversion Price, Series B Preferred Conversion Price, Series
C Preferred Conversion Price, Series D Preferred Conversion Price, Series E
Preferred Conversion Price or Series E-1 Preferred Conversion Price, as adjusted
upon the issuance of such rights, options or Convertible Securities, shall be
made as a result of the actual issuance of Additional Shares of Common Stock on
the exercise of any such rights or options or the conversion of any such
Convertible Securities. If any such rights or options or the conversion
privilege represented by any such Convertible Securities shall expire without
having been exercised, the Series A Preferred Conversion Price, Series B
Preferred Conversion Price, Series C Preferred Conversion Price, Series D
Preferred Conversion Price, Series E Preferred Conversion Price or Series E-1
Preferred Conversion Price as adjusted upon the issuance of such rights, options
or Convertible Securities shall be readjusted to the Series A Preferred
Conversion Price, Series B Preferred Conversion Price, Series C Preferred
Conversion Price, Series D Preferred Conversion Price, Series E Preferred
Conversion Price or Series E-1 Preferred Conversion Price, as the case may be,
which would have been in effect had an adjustment been made on the basis that
the only Additional Shares of Common Stock so issued were the Additional Shares
of Common Stock, if any, actually issued or sold on the exercise of such rights
or options or rights of conversion of such Convertible Securities, and such
Additional Shares of Common Stock, if any, were issued or sold for the
consideration actually received by the Corporation upon such exercise, plus the
consideration, if any, actually received by the Corporation for the granting of
all such rights or options, whether or not exercised, plus the consideration
received for issuing or selling the Convertible Securities actually converted,
plus the consideration, if any, actually received by the Corporation (other than
by cancellation of liabilities or obligations evidenced by such Convertible
Securities) on the conversion of such Convertible Securities, provided that such
readjustment shall not apply to prior conversions of Series A Preferred, Series
B Preferred, Series C Preferred, Series D Preferred, Series E Preferred or
Series E-1 Preferred.
(iv) "Additional Shares of Common Stock" shall mean all Common
Shares issued by the Corporation or deemed to be issued pursuant to this Section
5j, whether or not subsequently reacquired or retired by the Corporation other
than (A) Common Shares issued or issuable upon conversion of the Series
Preferred; (B) Common Shares and/or options, warrants or other Common Share
purchase rights, and the Common Shares issued or issuable pursuant to such
options, warrants or other rights (as adjusted for any stock dividends,
combinations, splits, recapitalizations and the like) after the Filing Date to
employees, officers or directors of, or consultants or advisors to the
Corporation or any subsidiary pursuant to stock purchase or stock option plans
or other arrangements that are approved by the Board of Directors; (C) Common
Shares issued or issuable pursuant to the exercise of options, warrants or
12.
convertible securities outstanding as of the Filing Date, (D) Common Shares
and/or options, warrants or other Common Share purchase rights, and the Common
Shares issued or issuable pursuant to such options, warrants or other rights
issued for consideration other than cash pursuant to a merger, consolidation,
acquisition or similar business combination approved by the Board of Directors,
(E) Common Shares issued or issuable pursuant to the special adjustment
provisions of Section 5k below; (F) Common Shares issued or issuable pursuant to
any equipment leasing arrangement, or debt financing from a bank or similar
financial institution approved by the Board of Directors, and (G) Common Shares
issued or issuable in connection with strategic transactions involving the
Corporation and other entities, including joint ventures, manufacturing,
marketing or distribution arrangements, and technology transfer or development
arrangements approved by the Board of Directors. References to Common Shares in
the subsections of this clause (iv) above shall mean all Common Shares issued by
the Corporation or deemed to be issued pursuant to this Section 5j. The
"Effective Price" of Additional Shares of Common Stock shall mean the quotient
determined by dividing the total number of Additional Shares of Common Stock
issued or sold, or deemed to have been issued or sold by the Corporation under
this Section 5j, into the aggregate consideration received, or deemed to have
been received by the Corporation for such issue under this Section 5j, for such
Additional Shares of Common Stock.
k. Special Adjustments to Series E and E-1 Conversion Prices.
In addition to any other adjustments that may be made to the Conversion Prices
of the Series E Preferred and the Series E-1 Preferred pursuant to this Section
5, in the event of (i) an Initial Public Offering (as defined in Article V.B.1),
the Conversion Price per share of each of the Series E-1 Preferred and Series E
Preferred shall automatically be adjusted, immediately prior to the closing of
such offering, and immediately prior to any conversion pursuant to Sections
5n(i) and (ii), to a price equal to the lesser of (x) the Conversion Price then
in effect for the Series E Preferred and Series E-1 Preferred, respectively, or
(y) the amount equal to 85% multiplied by the price to the public of shares of
the Corporation's Common Stock as sold by the Corporation in the an Initial
Public Offering (as defined in Article V.B.1) and (ii) an Asset Transfer or
Acquisition (each as defined in Article V.D.3.c), the Conversion Price per share
of each of the Series E-1 Preferred and Series E Preferred shall automatically
be adjusted, immediately prior to the closing of the Asset Transfer or
Acquisition (and only in the event an Initial Public Offering (as defined in
Article V.B.1) has not yet been consummated), to a price equal to the lesser of
(x) the Conversion Price then in effect for the Series E Preferred and Series E-
1 Preferred, respectively, or (y) the amount equal to 85% multiplied by the
Acquisition Price Per Share. For purposes of the preceding sentence,
"Acquisition Price Per Share" shall equal the aggregate dollar value of the
consideration payable pursuant to the Asset Transfer or Acquisition, as the case
may be, in exchange for the Outstanding Shares divided by the Outstanding
Shares. "Outstanding Shares" for this purpose shall be measured immediately
prior to such closing (after giving effect to any adjustment under this Section
5k) and shall equal, as of such time, the sum of (A) the number of shares of
Common Stock then outstanding, including any shares issued prior to or in
connection with such transaction as a result of the exercise of any options and
warrants, and (B) the number of shares of Common Stock into which the then
outstanding shares of Series Preferred could then be converted if fully
converted as of the time of such issuance.
l. Certificate of Adjustment. In each case of an adjustment or
readjustment of the Series A Preferred Conversion Price, Series B Preferred
Conversion Price,
13.
Series C Preferred Conversion Price, Series D Preferred Conversion Price, Series
E Preferred Conversion Price or Series E-1 Preferred Conversion Price for the
number of Common Shares or other securities issuable upon conversion of the
Series A Preferred, Series B Preferred, Series C Preferred, Series D Preferred,
Series E Preferred or Series E-1 Preferred, if the Series A Preferred, Series B
Preferred, Series C Preferred or Series D Preferred, Series E Preferred or
Series E-1 Preferred is then convertible pursuant to this Section 5, the
Corporation, at its expense, shall compute such adjustment or readjustment in
accordance with the provisions hereof and prepare a certificate showing such
adjustment or readjustment, and shall mail such certificate, by first class
mail, postage prepaid, to each registered holder of Series A Preferred, Series B
Preferred, Series C Preferred, Series D Preferred, Series E Preferred or Series
E-1 Preferred at the holder's address as shown in the Corporation's books. The
certificate shall set forth such adjustment or readjustment, showing in detail
the facts upon which such adjustment or readjustment is based, including a
statement of (i) the consideration received or deemed to be received by the
Corporation for any Additional Shares of Common Stock issued or sold or deemed
to have been issued or sold, (ii) the Series A Preferred Conversion Price,
Series B Preferred Conversion Price, Series C Preferred Conversion Price, Series
D Preferred Conversion Price, Series E Preferred Conversion Price or Series E-1
Preferred Conversion Price at the time in effect, (iii) the number of Additional
Shares of Common Stock and (iv) the type and amount, if any, of other property
which at the time would be received upon conversion of the Series A Preferred,
Series B Preferred, Series C Preferred, Series D Preferred, Series E Preferred
or Series E-1 Preferred.
m. Notices of Record Date. Upon (i) any taking by the
Corporation of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any
dividend or other distribution, or (ii) any Acquisition (as defined in Section
3c) or other capital reorganization of the Corporation, any reclassification or
recapitalization of the capital stock of the Corporation, any merger or
consolidation of the Corporation with or into any other corporation, or any
Asset Transfer (as defined in Section 3c), or any voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the Corporation shall
mail to each holder of Series Preferred at least twenty (20) days prior to the
record date specified therein a notice specifying (A) the date on which any such
record is to be taken for the purpose of such dividend or distribution and a
description of such dividend or distribution, (B) the date on which any such
Acquisition, reorganization, reclassification, transfer, consolidation, merger,
Asset Transfer, dissolution, liquidation or winding up is expected to become
effective, and (C) the date, if any, that is to be fixed as to when the holders
of record of Common Stock (or other securities) shall be entitled to exchange
their shares of Common Stock (or other securities) for securities or other
property deliverable upon such Acquisition, reorganization, reclassification,
transfer, consolidation, merger, Asset Transfer, dissolution, liquidation or
winding up.
n. Automatic Conversion.
(i) Each share of Series A Preferred, Series B Preferred,
Series C Preferred and Series D Preferred shall automatically be converted into
shares of Common Stock, based on the then-effective Series A Preferred
Conversion Price, Series B Preferred Conversion Price, Series C Preferred
Conversion Price and Series D Preferred Conversion Price, as the case may be,
(a) at any time upon the affirmative vote of the holders of
14.
at least sixty-six and two-thirds percent (66-2/3%) of the outstanding shares of
the Series Preferred (voting on an as-if-converted basis as a single class) or
(b) immediately upon the closing of a firmly underwritten public offering
pursuant to an effective registration statement under the Securities Act of
1933, as amended, covering the offer and sale of Common Stock for the account of
the Corporation in which (A) the per share price is at least $11.00 (as adjusted
for any stock dividends, combinations, splits, recapitalizations and the like),
and (B) the gross cash proceeds to the Corporation (before deducting
underwriting discounts, commissions and fees) are at least $20,000,000 (a
"Qualified IPO"). Each share of Series E-1 Preferred shall automatically be
converted into shares of Common Stock based on the then-effective Series E-1
Preferred Conversion Price and each share of Series E Preferred Stock shall
automatically be converted into shares of Class B Common Stock, based upon the
then-effective Series E Preferred Conversion Price, (a) at any time upon the
affirmative vote of the holders of at least sixty-six and two-thirds percent
(66-2/3%) of the outstanding shares of Series E Preferred and Series E-1
Preferred, as the case may be, or (b) immediately upon the closing of a
Qualified IPO. Upon such automatic conversion, any declared and unpaid dividends
shall be paid in accordance with the provisions of Section 5d.
(ii) Each share of Class B Common Stock shall
automatically be converted into the identical number of fully paid and
nonassessable shares of Common Stock immediately upon any sale, disposition,
assignment or transfer of any shares of Class B Common Stock by the holder
thereof after the earlier of (A) the date one year after the Original Series E
Issuance Date or (B) the date 180 days after a Qualified IPO.
(iii) Upon the occurrence of any of the events
specified in subsections (i) and (ii) above, the outstanding shares of Series
Preferred or Class B Common Stock, as applicable, shall be converted
automatically without any further action by the holders of such shares and
whether or not the certificates representing such shares are surrendered to the
Corporation or its transfer agent; provided, however, that the Corporation shall
not be obligated to issue certificates evidencing the shares of Common Stock or
Class B Common Stock, as the case may be, issuable upon such conversion unless
the certificates evidencing such shares of Series Preferred or Class B Common
Stock, as applicable, are either delivered to the Corporation or its transfer
agent as provided below, or the holder notifies the Corporation or its transfer
agent that such certificates have been lost, stolen or destroyed and executes an
agreement satisfactory to the Corporation to indemnify the Corporation from any
loss incurred by it in connection with such certificates. Upon the occurrence of
such automatic conversion of such shares, the holders of such shares shall
surrender the certificates representing such shares at the office of the
Corporation or any transfer agent for such shares. Thereupon, there shall be
issued and delivered to such holder promptly at such office and in its name as
shown on such surrendered certificate or certificates, a certificate or
certificates for the number of shares of Common Stock or Class B Common Stock,
as the case may be, into which the shares surrendered were convertible on the
date on which such automatic conversion occurred, and any declared and unpaid
dividends shall be paid in accordance with the provisions of Section 5d.
o. Fractional Shares. No fractional Common Shares shall be
issued upon conversion of Series Preferred. All shares of Common Stock or Class
B Common Stock (including fractions thereof) issuable upon conversion of more
than one share of Series Preferred by a holder thereof shall be aggregated for
purposes of determining whether the conversion
15.
would result in the issuance of any fractional share. If, after the
aforementioned aggregation, the conversion would result in the issuance of any
fractional share, the Corporation shall, in lieu of issuing any fractional
share, pay cash equal to the product of such fraction multiplied by the Common
Stock's fair market value (as determined by the Board of Directors) on the date
of conversion.
p. Reservation of Stock Issuable Upon Conversion. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, Class B Common Stock and Series E-1
Preferred, solely for the purpose of effecting the conversion of the shares of
Class B Common Stock or Series Preferred, such number of its shares of Common
Stock, Class B Common Stock and Series E-1 Preferred as shall from time to time
be sufficient to effect the conversion of all outstanding shares of Class B
Common Stock or Series Preferred. If at any time the number of authorized but
unissued shares of Common Stock, Class B Common Stock or Series E-1 Preferred
shall not be sufficient to effect the conversion of all then outstanding shares
of Class B Common Stock or Series Preferred, the Corporation will take such
corporate action as may, in the opinion of its counsel, be necessary to increase
its authorized but unissued shares of Common Stock, Class B Common Stock and
Series E-1 Preferred to such number of shares as shall be sufficient for such
purpose.
q. Notices. Any notice required by the provisions of this
Section 5 shall be in writing and shall be deemed effectively given: (i) upon
personal delivery to the party to be notified, (ii) when sent by confirmed telex
or facsimile if sent during normal business hours of the recipient; if not, then
on the next business day, (iii) five (5) days after having been sent by
registered or certified mail, return receipt requested, postage prepaid, or (iv)
one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. All notices
shall be addressed to each holder of record at the address of such holder
appearing on the books of the Corporation.
r. Payment of Taxes. The Corporation will pay all taxes (other
than taxes based upon income) and other governmental charges that may be imposed
with respect to the issue or delivery of shares of Common Stock, Class B Common
Stock or Series E-1 Preferred upon conversion of shares of Class B Common Stock
or Series Preferred, excluding any tax or other charge imposed in connection
with any transfer involved in the issue and delivery of shares of Common Stock,
Class B Common Stock or Series E-1 Preferred in a name other than that in which
the shares of Series Preferred so converted were registered.
s. No Dilution or Impairment. Without the consent of the
holders of the then outstanding Series Preferred, as required under Section 2b,
the Corporation shall not amend its Amended and Restated Certificate of
Incorporation or participate in any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or take any
other voluntary action, for the purpose of avoiding or seeking to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Corporation, but shall at all times in good faith assist in
carrying out all such action as may be reasonably necessary or appropriate in
order to protect the conversion rights of the holders of the Series Preferred
against dilution or other impairment.
16.
6. No Reissuance of Series Preferred. No share or shares of Series
Preferred or Class B Common Stock acquired by the Corporation by reason of
redemption, purchase, conversion or otherwise shall be reissued; and in
addition, the Amended and Restated Certificate of Incorporation shall be
appropriately amended to effect the corresponding reduction in the Corporation's
authorized stock.
E. Common Shares.
1. Voting Rights. The holder of each share of Common Stock shall
have the right to one vote, and shall be entitled to notice of any stockholders'
meeting in accordance with the Bylaws of the Corporation, and shall be entitled
to vote upon such matters and in such manner as may be provided by law. Except
as required by law or as set forth herein, holders of Class B Common Stock shall
not be entitled to vote for the election of directors or to vote on any other
matter.
2. Dividend Rights. Subject to the prior rights of holders of all
classes of stock at the time outstanding having prior rights as to dividends,
the holders of the Common Stock and the Class B Common Stock shall be entitled
to receive, when and as declared by the Board of Directors, out of any assets
and funds of the Corporation legally available therefor, such dividends as may
be declared from time to time by the Board of Directors.
3. Liquidation Rights. Upon the liquidation, dissolution or winding
up of the Corporation, the assets of the Corporation shall be distributed as
provided in Section D3 of this Article IV.
4. Redemption. The Common Stock and the Class B Common Stock are
not redeemable.
5. Conversion. The Class B Common Stock will be convertible as
provided in Section D5 of this Article IV.
F. Treatment of Series E Preferred Stock and Series E-1 Preferred Stock.
Except as otherwise set forth herein, the rights, preferences, privileges and
restrictions of the Series E Preferred Stock and the Series E-1 Preferred Stock
shall be identical in all respects, and any action by the Corporation affecting
the shares of Series E Preferred Stock or the Series E-1 Preferred Stock,
including without limitation, stock dividends, subdivisions, combinations,
consolidations, distributions, reclassifications, exchanges and substitutions,
shall affect the shares of the Series E Preferred Stock and the Series E-1
Preferred Stock equally.
G. Treatment of Common Stock and Class B Common Stock. Except as
otherwise set forth herein, the rights, privileges and restrictions of the
Common Stock and the Class B Common Stock shall be identical in all respects,
and any action by the Corporation affecting the Common Stock or Class B Common
Stock, including without limitation, stock dividends, subdivisions,
combinations, consolidations, distributions, reclassifications, exchanges and
substitutions, shall affect the shares of Common Stock and Class B Common Stock
equally.
V.
17.
For the management of the business and for the conduct of the affairs of
the Corporation, and in further definition, limitation and regulation of the
powers of the Corporation, of its directors and of its stockholders or any class
thereof, as the case may be, it is further provided that:
A. Management. The management of the business and the conduct of the
affairs of the Corporation shall be vested in its Board of Directors. The
number of directors which shall constitute the whole Board of Directors shall be
fixed exclusively by one or more resolutions adopted by the Board of Directors.
B. Board of Directors.
1. Subject to the rights of the holders of any series of Preferred
Stock to elect additional directors under specified circumstances, following the
closing of the initial public offering pursuant to an effective registration
statement under the Securities Act of 1933, as amended (the "1993 Act"),
covering the offer and sale of Common Stock to the public (the "Initial Public
Offering"), the directors shall be divided into three classes designated as
Class I, Class II and Class III, respectively. Directors shall be assigned to
each class in accordance with a resolution or resolutions adopted by the Board
of Directors. At the first annual meeting of stockholders following the closing
of the Initial Public Offering, the term of office of the Class I directors
shall expire and Class I directors shall be elected for a full term of three
years. At the second annual meeting of stockholders following the Initial
Public Offering, the term of office of the Class II directors shall expire and
Class II directors shall be elected for a full term of three years. At the
third annual meeting of stockholders following the Initial Public Offering, the
term of office of the Class III directors shall expire and Class III directors
shall be elected for a full term of three years. At each succeeding annual
meeting of stockholders, directors shall be elected for a full term of three
years to succeed the directors of the class whose terms expire at such annual
meeting. During such time or times that the corporation is subject to Section
2115(b) of the California General Corporation Law ("CGCL"), this Section B.1. of
this Article V shall become effective and be applicable only when the
Corporation is a "listed" corporation within the meaning of Section 301.5 of the
CGCL.
2. In the event that the Corporation is unable to have a classified
board under applicable law, Section 301.5 of the CGCL, Section B.1. of this
Article V shall not apply and all directors shall be elected at each annual
meeting of stockholders to hold office until the next annual meeting.
3. No stockholder entitled to vote at an election for directors may
cumulate votes to which such stockholder is entitled, unless, at the time of
such election, the Corporation (i) is subject to Section 2115(b) of the CGCL and
(ii) is not or ceases to be a "listed" corporation under Section 301.5 of the
CGCL. During this time, every stockholder, entitled to vote at an election for
directors may cumulate such stockholder's votes and give one candidate a number
of votes equal to the number of directors to be elected multiplied by the number
of votes to which such stockholder's shares are otherwise entitled, or
distribute the stockholder's votes on the same principle among as many candidate
or candidates have been placed in nomination prior to the voting and (ii) the
stockholder has given notice at the meeting, prior to the voting, of such
stockholder's intention to cumulate such stockholder's votes. If any
stockholder has given
18.
proper notice to cumulate votes, all stockholders may cumulate their votes for
any candidates who have been properly placed in nomination. Under cumulative
voting, the candidates receiving the highest number of votes, up to the number
of directors to be elected, are elected.
Notwithstanding the foregoing provisions of this section, each director
shall serve until his successor is duly elected and qualified or until his
death, resignation or removal. No decrease in the number of directors
constituting the Board of Directors shall shorten the term of any incumbent
director.
C. Removal of Directors.
1. During such time or times that the Corporation is subject to
Section 2115(b) of the CGCL, the Board of Directors or any individual director
may be removed from office at any time without cause by the affirmative vote of
the holders of at least a majority of the outstanding shares entitled to vote on
such removal; provided, however, that unless the entire Board is removed, no
individual director may be removed when the votes cast against such director's
removal, or not consenting in writing to such removal, would be sufficient to
elect that director if voted cumulatively at an election which the same total
number of votes were cast (or, if such action is taken by written consent, all
shares entitled to vote were voted) and the entire number of directors
authorized at the time of such director's most recent election were then being
elected.
2. At any time or times that the Corporation is not subject to
Section 2115(b) of the CGCL and subject to any limitations imposed by law,
Section C.1. above shall no longer apply and removal shall be as provided in
Section 141(k) of the DGCL.
D. Vacancies.
1. Subject to the rights of the holders of any series of Preferred
Stock and Article IV.D.2.d., any vacancies on the Board of Directors resulting
from death, resignation, disqualification, removal or other causes and any newly
created directorships resulting from any increase in the number of directors,
shall, unless the Board of Directors determines by resolution that any such
vacancies or newly created directorships shall be filled by the stockholders,
except as otherwise provided by law, be filled only by the affirmative vote of a
majority of the directors then in office, even though less than a quorum of the
Board of Directors, and not by the stockholders. Any director elected in
accordance with the preceding sentence shall hold office for the remainder of
the full term of the director for which the vacancy was created or occurred and
until such director's successor shall have been elected and qualified.
2. If at the time of filling any vacancy or any newly created
directorship, the directors then in office shall constitute less than a majority
of the whole board (as constituted immediately prior to any such increase), the
Delaware Court of Chancery may, upon application of any stockholder or
stockholders holding at least ten percent (10%) of the total number of the
shares at the time outstanding having the right to vote for such directors,
summarily order an election to be held to fill any such vacancies or newly
created directorships, or to replace the directors chosen by the directors then
in offices as aforesaid, which election shall be governed by Section 211 of the
DGCL.
19.
3. At any time or times that the Corporation is subject to Section
2115(b) of the CGCL, if, after the filling of any vacancy by the directors then
in office who have been elected by stockholders shall constitute less than a
majority of the directors then in office, then
a. Any holder or holders of an aggregate of five percent (5%)
or more of the total number of the shares at the time outstanding having the
right to vote for those directors may call a special meeting of stockholders; or
b. The Superior Court of the proper county shall, upon
application of such stockholder or stockholders, summarily order a special
meeting of stockholders, to be held to elect the entire board, all in accordance
with Section 305(c) of the CGCL. The term of office of any director shall
termination upon that election of a successor.
E. Bylaw Amendments. Subject to paragraph (h) of Section 43 of the
Bylaws, the Bylaws may be altered or amended or new Bylaws adopted by the
affirmative vote of at least sixty-six and two-thirds percent (66-2/3%) of the
voting power of all of the then-outstanding shares of the voting stock of the
Corporation entitled to vote. The Board of Directors shall also have the power
to adopt, amend, or repeal Bylaws.
F. Ballots. The directors of the Corporation need not be elected by
written ballot unless the Bylaws so provide.
G. Action By Stockholders. No action shall be taken by the stockholders
of the Corporation except at an annual or special meeting of stockholders called
in accordance with the Bylaws or by written consent of stockholders in
accordance with the Bylaws prior to the closing of the Initial Public Offering
and following the closing of the Initial Public Offering no action shall be
taken by the stockholders by written consent.
H. Advance Notice. Advance notice of stockholder nominations for the
election of directors and of business to be brought by stockholders before any
meeting of the stockholders of the Corporation shall be given in the manner
provided by the Bylaws of the Corporation.
VI.
A. The liability of the directors of the Corporation for monetary damages
shall be eliminated to the fullest extent permissible under applicable law.
B. The Corporation is authorized to provide indemnification of agents (as
defined in Section 317 of the CGCL) for breach of duty to the Corporation and
its stockholders through bylaw provisions or through agreements with agents, or
through stockholder resolutions, or otherwise, in excess of the indemnification
otherwise permitted by Section 317 of the CGCL, subject, at any time or times
that the Corporation is subject to Section 2115(b) of the CGCL, to the limits on
such excess indemnification set forth in Section 204 of the CGCL.
C. Any repeal or modification of this Article shall only be prospective
and shall not effect the rights under this Article in effect at the time of the
alleged occurrence of any action or omission to act giving rise to liability.
20.
VII.
A. The Corporation reserves the right to amend, alter, change or repeal
any provision contained in this Amended and Restated Certificate of
Incorporation, in the manner now or hereafter prescribed by statute, except as
provided in paragraph B of this Article VII, and all rights conferred upon the
stockholders herein are granted subject to this reservation.
B. Notwithstanding any other provisions of this Amended and Restated
Certificate of Incorporation or any provision of law which might otherwise
permit a lesser vote or no vote, but in addition to any affirmative vote of the
holders of any particular class or series of the voting stock required by law,
this Certificate of Incorporation or any Preferred Stock designation, the
affirmative vote of the holders of at least sixty-six and two-thirds percent
(66-2/3%) of the voting power of all of the then-outstanding shares of the
voting stock, voting together as a single class, shall be required to alter,
amend or repeal Articles V, VI and VII."
FOUR: The foregoing amendment and restatement of the Certificate of
Incorporation has been duly approved by the Board of Directors of this
Corporation.
FIVE: This Amended and Restated Certificate of Incorporation has been
duly adopted in accordance with the provisions of Sections 228, 242 and 245 of
the DGCL by the Board of Directors and the stockholders of the Corporation.
SIX: The total number of outstanding shares entitled to vote with
respect to the amendment herein set forth was 11,486,266 shares of Common Stock,
2,023,077 shares of Series A Preferred Stock, 4,363,637 shares of Series B
Preferred Stock, 6,809,135 shares of Series C Preferred Stock and 1,418,182
shares of Series D Preferred Stock. The number of shares voting in favor of the
amendment equaled or exceeded the vote required. The percentage vote required
was a majority of the outstanding Common Stock, voting as a separate class, a
majority of the outstanding Series C Preferred Stock, voting as a separate
class, and at least seventy-five percent (75%) of the outstanding Series A
Preferred Stock, Series B Preferred Stock, Series C Preferred Stock and Series D
Preferred Stock, voting together as a separate class.
21.
The undersigned, Ofer Ben-Shachar and Timothy J. Moore, the President and
Secretary, respectively, of NOOSH, Inc., declare under penalty of perjury under
applicable law that the matters set out in the foregoing Amended and Restated
Certificate of Incorporation are true of their own knowledge.
Executed at Palo Alto, California on March 31, 2000.
/s/ Ofer Ben-Shachar
-------------------------------------
Ofer Ben-Shachar, President
/s/ Timothy J. Moore
-------------------------------------
Timothy J. Moore, Secretary
22.