CERTIFICATE OF AMENDMENT AND RESTATEMENT
OF
ARTICLES OF INCORPORATION
Richard B. Gordinier and Jeffrey A. Wahba certify that:
1. They are the President and Secretary, respectively, of Henry
Company, a California corporation.
2. The Articles of Incorporation of the Corporation are amended
and restated to read in their entirety as follows:
ARTICLES OF INCORPORATION
OF
HENRY COMPANY
ONE: The name of this corporation is:
Henry Company
TWO: The purpose of the corporation is to engage in any lawful act
or activity for which a corporation may be organized under the General
Corporation Law of California, other than the banking business, the trust
company business or the practice of a profession permitted to be incorporated
by the California Corporations Code.
THREE: The number of shares of stock which the Corporation is
authorized to issue is One Million (1,000,000) shares of Common Stock, no par
value (the "Common Stock"), and Thirty Thousand (30,000) shares of Class A
Common Stock, no par value (the "Class A Common Stock"). The number of
shares of Preferred Stock which this Corporation is authorized to issue is
100,000 shares, without par value.
The Preferred Stock may be issued from time to time in one or more
series. The rights, preferences, privileges and restrictions granted to and
imposed upon the first such series, designated Series A Convertible Preferred
Stock, of which the
Corporation is to issue Twenty-Two Thousand Five Hundred (22,500) shares, are
set forth below. The Board of Directors of the Corporation is expressly
authorized to provide for the issue of all or any of the remaining shares of
Preferred Stock in one or more series, and to fix the number of shares and to
determine or alter for each such series, such voting powers, full or limited,
or no voting powers, and such designations, preferences and relative,
participating, optional or other rights and such qualifications, limitations
or restrictions thereof, as shall be stated and expressed in the resolution
or resolutions adopted by the Board of Directors providing for the issue of
such shares, and as may be permitted by the General Corporation Law of the
State of California. The Board of Directors is authorized to decrease the
number of shares of any series subsequent to the issuance of shares of that
series, but not below the number of shares of that series then outstanding.
In case the number of shares of any series shall be so decreased, the shares
constituting such decrease shall resume the status they had prior to the
adoption of the resolution originally fixing the number of shares of such
series.
The relative rights, powers, preferences and restrictions granted
to the Common Stock, Class A Common Stock and Series A Convertible Preferred
Stock Classes is as follows:
COMMON STOCK
On all matters upon which shareholders are entitled or permitted to
vote, every holder of Common Stock shall be entitled to one (1) vote for each
share of Common Stock standing in his name on the transfer books of the
Corporation and every holder of Class A Common Stock shall be entitled to
thirty-five (35) votes for each share of Common Stock standing in his name on
the transfer books of the Corporation. Except as otherwise may be required
by law, the holders of Common Stock and Class A Common Stock shall vote
together as a single class. Except as provided in this Article THREE, the
Common Stock and the Class A Common Stock shall have the same rights and
privileges and shall rank equally, share ratably and be identical in all
respects as to all matters.
SERIES A CONVERTIBLE PREFERRED STOCK
1. DESIGNATION. The first series of Preferred Stock is
designated the Series A Convertible Preferred Stock and the number of shares
of such series is 22,500. The Series A Convertible Preferred Stock shall,
with respect to rights on liquidation, winding up and dissolution, rank prior
to the Corporation's Common Stock, Class A Common Stock and all other series
or classes of the Corporation's equity securities now or hereafter
authorized, issued or outstanding.
-2-
2. DIVIDEND RIGHTS.
(a) The holders of the Series A Convertible Preferred Stock
shall be entitled to receive, on an as-converted basis, any dividends which
are declared on the Corporation's Class A Common Stock or Common Stock, when,
as and if declared by the Board of Directors, out of the assets of the
Corporation which are legally available therefor.
(b) Dividends shall not accrue or accumulate on any share of
Series A Preferred Stock, except to the extent they are declared but unpaid.
Accumulation of declared but unpaid dividends shall bear no interest.
3. VOTING RIGHTS. The holder of each share of Series A
Convertible Preferred Stock shall have the right to one vote for each share
of Common Stock into which such share of Series A Convertible Preferred Stock
could be converted at the record date for determination of the shareholders
entitled to vote on any matters, or, if no such record date is established,
at the date such vote is taken or any written consent of shareholders is
solicited (with any fractional share determined on an aggregate conversion
basis being rounded to the nearest whole share), and with respect to such
vote, such holder shall have full voting rights and powers equal to the
voting rights and powers of the holders of Common Stock, and shall be
entitled to notice of any shareholders' meeting in accordance with the bylaws
of the Corporation, and shall be entitled to vote, together with holders of
Common Stock, with respect to any question upon which holders of Common Stock
have the right to vote.
Without the consent of a majority of the outstanding shares of the
Series A Convertible Preferred Stock (so long as any such shares are
outstanding), the Corporation shall not effect any amendment, repeal or
alteration of the Corporation's Articles of Incorporation (or any provision
thereof) which would adversely affect any of the specific rights, powers or
privileges of the Series A Convertible Preferred Stock set forth herein.
4. CONVERSION RIGHTS. The holders of the Series A Convertible
Preferred Stock shall have conversion rights as follows (the "Conversion
Rights"):
(a) RIGHT TO CONVERT. Each share of Series A Convertible
Preferred Stock shall be convertible, at the option of the holder thereof,
without payment of additional consideration, at any time after the date of
issuance of such share, at the office of the Corporation or any transfer
agent for such stock, into fully-paid and nonassessable shares of Common
Stock.
-3-
(b) CONVERSION PRICE. The Series A Convertible Preferred
Stock shall be convertible into the number of shares of Common Stock which
result from dividing the Conversion Price (as hereinafter defined) in effect
at the time of conversion into $1.00. The price at which shares of Common
Stock shall be deliverable upon conversion of Series A Convertible Preferred
Stock (the "Conversion Price") shall initially be $1.00 per share of Common
Stock. Such initial Conversion Price shall be subject to adjustment as
hereinafter provided.
(c) AUTOMATIC CONVERSION. Each share of Series A Convertible
Preferred Stock shall automatically be converted into shares of Common Stock
at the then effective Conversion Price, in the event of the closing of a firm
commitment underwritten public offering pursuant to an effective registration
statement under the Securities Act of 1933, as amended, covering the offer
and sale of any equity securities of the Corporation (whether for the account
of the Corporation or for the account of one or more shareholders of the
Corporation) having aggregate proceeds (prior to expenses for underwriters
discount or other expenses) to the Corporation and/or selling shareholders in
excess of Ten Million Dollars ($10,000,000).
Upon the occurrence of an automatic conversion, the
outstanding shares of Series A Convertible Preferred Stock shall be converted
automatically without further action by the holders of said shares and
whether or not the certificates representing said shares are surrendered to
the Corporation or its transfer agent; provided, however, the Corporation
shall not be obligated to issue certificates evidencing the shares of Common
Stock unless certificates evidencing the Series A Convertible Preferred Stock
are either delivered to the Corporation or any transfer agent as hereinafter
provided, or the holder notifies the Corporation that said certificate or
certificates have been lost, stolen or destroyed and executes an agreement
satisfactory to the Corporation, indemnifying the Corporation against any
loss incurred by it in connection therewith. In the event of an underwritten
public offering, the person(s) entitled to receive the Common Stock issuable
upon conversion of the Series A Convertible Preferred Stock shall not be
deemed to have converted such stock until immediately prior to the closing of
such sale of equity securities (the "Offering Conversion Date").
(d) MECHANICS OF VOLUNTARY CONVERSION. Before any holder of
the Series A Convertible Preferred Stock shall be entitled to convert the
same into full shares of Common Stock, he shall surrender the certificate or
certificates therefore, duly endorsed, at the office of the Corporation or of
any transfer agent for such stock, and shall give written notice to the
Corporation at such office that he elects to convert the same. The
Corporation shall, as soon as practicable thereafter, issue and deliver to
such holder, at such office and in his name as shown on such surrendered
certificate or certificates, a certificate or certificates for the number of
shares of Common Stock into
-4-
which such converted shares of stock were convertible on the Conversion Date
(as hereinafter defined). Such conversion shall be deemed to have been made
immediately prior to the close of business on the date of such surrender of
the shares of the Series A Convertible Preferred Stock (the "Conversion
Date"). The person or persons entitled to receive the shares of Common Stock
issuable upon such conversion shall be treated for all purposes as the record
holder or holders of such shares of Common Stock as of the Conversion Date.
(e) FRACTIONAL SHARES. No fractional shares of Common Stock
or scrip shall be issued upon conversion of shares of Series A Convertible
Preferred Stock. If more than one share of Series A Convertible Preferred
Stock shall be surrendered for conversion at any one time by the same holder,
the number of full shares of Common Stock issuable upon conversion thereof
shall be computed on the basis of the aggregate number of shares of Series A
Convertible Preferred Stock so surrendered. Instead of any fractional shares
of Common Stock which would otherwise be issuable upon conversion of any
shares of Series A Convertible Preferred Stock, the Corporation shall pay a
cash adjustment in respect of such fractional interest in an amount equal to
the fair market value of such fraction as of the date of Conversion (as
determined in good faith by the Board of Directors).
(f) CONVERSION PRICE ADJUSTMENTS. The Conversion Price shall
be subject to adjustment from time to time as follows:
(i) STOCK DIVIDENDS, SUBDIVISIONS, RECLASSIFICATIONS
OR COMBINATIONS. If the Corporation shall (i) declare a dividend or make a
distribution on its Common Stocks in shares of its Common Stock, (ii)
subdivide or reclassify the outstanding shares of Common Stock into a greater
number of shares, or (iii) combine or reclassify the outstanding Common Stock
into a smaller number of shares, the Conversion Price in effect at the time
of the record date for such dividend or distribution or the effective date of
such subdivision, combination or reclassification shall be proportionately
adjusted so that the holder of any shares of Series A Convertible Preferred
Stock surrendered for conversion after such date shall be entitled to receive
the number of shares of Common Stock which he would have owned or been
entitled to receive had such Series A Convertible Preferred Stock been
converted immediately prior to such date. Successive adjustments in the
Conversion Price shall be made whenever any event specified above shall occur.
(ii) CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE.
In case of any consolidation with or merger of the Corporation with or into
another corporation, or in case of any sale, lease or conveyance to another
corporation of the assets of the Corporation as an entirety or substantially
as an entirety, each share of Series A Convertible Preferred Stock shall
after the date of such consolidation, merger, sale, lease or conveyance be
convertible into the number of shares of stock or other securities or
property (including cash) to which the Common Stock issuable (at the time of
such consolidation, merger,
-5-
sale, lease or conveyance) upon conversion of such share of Series A
Convertible Preferred Stock would have been entitled upon such consolidation,
merger, sale, lease or conveyance; and in any such case, if necessary, the
provisions set forth herein with respect to the rights and interests
thereafter of the holders of the shares of Series A Convertible Preferred
Stock shall be appropriately adjusted so as to be applicable, as nearly as
may reasonably be, to any shares of stock or other securities or property
thereafter deliverable on the conversion of the shares of Series A
Convertible Preferred Stock.
(iii) ROUNDING OF CALCULATIONS; MINIMUM ADJUSTMENT.
All calculations under this subparagraph (f) shall be made to the nearest
cent or to the nearest one hundredth (1/100th) of a share, as the case may
be. Any provision of this subparagraph (f) to the contrary notwithstanding,
no adjustment in the Conversion Price shall be made if the amount of such
adjustment would be less than $0.05, but any such amount shall be carried
forward and an adjustment with respect thereto shall be made at the time of
and together with any subsequent adjustment which, together with such amount
and any other amount or amounts so carried forward, shall aggregate $0.05 or
more.
(g) STATEMENT REGARDING ADJUSTMENTS. Whenever the Conversion
Price shall be adjusted as provided in subparagraph 4(f), the Corporation
shall forthwith file, at the office of any transfer agent for the Series A
Convertible Preferred Stock and at the principal office of the Corporation, a
statement showing in detail the facts requiring such adjustment and the
Conversion Price that shall be in effect after such adjustment, and the
Corporation shall also cause a copy of such statement to be sent by mail,
first class postage prepaid, to each holder of shares of Series A Convertible
Preferred Stock at its address appearing on the Corporation's records. Each
such statement shall be signed by the Corporation's independent public
accountants, if applicable. Where appropriate, such copy may be given in
advance and may be included as part of a notice required to be mailed under
the provisions of subparagraph 4(h).
(h) NOTICE TO HOLDERS. In the event the Corporation shall
propose to take any action of the type described in clause (f) which would
result in an adjustment in the Conversion Price), the Corporation shall give
notice to each holder of shares of Series A Convertible Preferred Stock, in
the manner set forth in subparagraph 4(g), which notice shall specify the
record date, if any, with respect to any such action and the approximate date
on which such action is to take place. Such notice shall also set forth such
facts with respect thereto as shall be reasonably necessary to indicate the
effect of such action (to the extent such effect may be known at the date of
such notice)
-6-
on the Conversion Price and the number, kind or class of shares or other
securities or property which shall be deliverable upon conversion of shares
of Series A Convertible Preferred Stock. In the case of any action which
would require the fixing of a record date, such notice shall be given at
least ten (10) days prior to the date so fixed, and in case of all other
action, such notice shall be given at least fifteen (15) days prior to the
taking of such proposed action. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of any such action.
(i) TREASURY STOCK. For the purposes of this paragraph 4,
the sale or other disposition of Common Stock theretofore held in the
Corporation's treasury shall be deemed to be an issuance thereof.
(j) COSTS. The Corporation shall pay all documentary, stamp,
transfer or other transactional taxes attributable to the issuance or
delivery of shares of Common Stock upon conversion of any shares of Series A
Convertible Preferred Stock; provided that the Corporation shall not be
required to pay any taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificate for such shares in a
name other than that of the holder of the shares of Series A Convertible
Preferred Stock in respect of which such shares are being issued.
(k) RESERVATION OF SHARES. The Corporation shall reserve at
all times so long as any shares of Series A Convertible Preferred Stock
remain outstanding, free from preemptive rights, out of its treasury stock
(if applicable) or its authorized but unissued shares of Common Stock, or
both, solely for the purpose of effecting the conversion of the shares of
Series A Convertible Preferred Stock, sufficient shares of Common Stock to
provide for the conversion of all outstanding shares of Series A Convertible
Preferred Stock.
(l) APPROVALS. If any shares of Common Stock to be reserved
for the purpose of conversion of shares of Series A Convertible Preferred
Stock require registration with or approval of any governmental authority
under any federal or state law before such shares may be validly issued or
delivered upon conversion, then the Corporation will in good faith and as
expeditiously as possible endeavor to secure such registration or approval,
as the case may be. If, and so long as, any Common Stock into which the
shares of Series A Convertible Preferred Stock are then convertible is listed
on any national securities exchange, the Corporation will, if permitted by
the rules of such exchange, list and keep listed on such exchange, upon
official notice of issuance, all shares of such Common Stock issuable upon
conversion.
(m) VALID ISSUANCE. All shares of Common Stock which may be
issued upon conversion of the shares of Series A Convertible Preferred Stock
will upon issuance by the Corporation be duly and validly issued, fully paid
and nonassessable
-7-
and free from all taxes, liens and charges with respect to the issuance
thereof, and the Corporation shall take no action which will cause a contrary
result (including without limitation, any action which would cause the
Conversion Price to be less than the par value, if any, of the Common Stock).
5. PREFERENCE ON LIQUIDATION.
(a) In the event of any liquidation, dissolution, involuntary
or voluntary corporate reorganization under the federal bankruptcy laws or
similar state laws, or winding up of the Corporation, the holders of shares
of the Series A Convertible Preferred Stock then outstanding shall be
entitled to be paid out of the assets and surplus funds of the Corporation
available for distribution to its shareholders, and before any payment shall
be made to the holders of any shares of Common Stock, an amount equal to
$63.955 per share (or an aggregate of One Million Four Hundred Thirty-nine
Thousand ($1,439,000) with respect to Twenty-two Thousand Five Hundred
(22,500) shares) plus any declared and unpaid dividends thereon to the date
fixed for distribution. If upon any such liquidation, dissolution,
bankruptcy or winding up of the Corporation the assets and surplus funds of
the Corporation available for distribution to its shareholders shall be
insufficient to pay the holders of the Series A Convertible Preferred Stock
the full amounts to which they are entitled, the holders of the Series A
Convertible Preferred Stock shall share ratably in the distribution of such
assets and surplus funds in proportion to the full preferential amounts to
which each such holder is otherwise entitled.
(b) In the event payments provided for in subparagraph (a)
above shall have been made, the holders of the Common Stock shall be entitled
to share PRO RATA in all remaining assets and surplus funds of the
Corporation available for distribution to its shareholders; PROVIDED,
HOWEVER, that in the event of a voluntary corporate reorganization under the
federal bankruptcy law or similar state laws or a voluntary winding up, the
holders of the Preferred Stock and the Common Stock shall be entitled to
share PRO RATA on a per share basis (treating each share of Preferred Stock
as if converted into Common Stock) in all remaining assets and surplus funds
of the Corporation available for distribution to its shareholders.
(c) The merger or consolidation of the Corporation into or
with another corporation or other entity or any other corporate
reorganization in which the Corporation shall not be the continuing or
surviving entity of such consolidation, merger or reorganization, the sale of
all or substantially all the assets of the Corporation, or a transaction or
series of related transactions by the Corporation in which in excess of fifty
percent (50%) of the Corporation's voting power is transferred, shall not be
deemed to be a liquidation, dissolution or winding up of the Corporation.
-8-
FOUR: The liability of the directors of the Corporation for
monetary damages shall be eliminated to the fullest extent permissible under
California law.
FIVE: The Corporation is authorized to indemnify the directors and
officers of the Corporation to the fullest extent permissible under California
law.
SIX: The amendment and restatement of the Articles of
Incorporation as herein set forth has been duly approved by the Board of
Directors.
The amendment and restatement herein set forth herein have been
duly approved by the required vote of shareholders in accordance with Section
903 of the California General Corporation Law. The total number of
outstanding shares of each class entitled to vote with respect to the
amendment was One Hundred Ninety-four Thousand (194,000) shares of Common
Stock and Six Thousand (6,000) shares of Class A Common Stock. The number of
shares of each class voting in favor of the amendment equal or exceeded the
vote required; the percentage vote required for each class entitled to vote
was more than fifty percent (50%).
-9-
The undersigned declare under penalty of perjury under the laws of
the State of California that the matters set have executed this Certificate
of Amendment and Restatement this 21st day of April, 1998.
/s/ Richard B. Gordinier
----------------------------------------
Richard B. Gordinier, President
/s/ Jeffrey A. Wahba
----------------------------------------
Jeffrey A. Wahba, Secretary
The undersigned declare under penalty of perjury under the laws of
the State of California that each of them has read the foregoing certificate
and knows the contents thereof and that the matters set forth in such
certificate are true and correct of each of their own knowledge.
Dated: April 21, 1998
/s/ Richard B. Gordinier
----------------------------------------
Richard B. Gordinier, President
/s/ Jeffrey A. Wahba
----------------------------------------
Jeffrey A. Wahba, Secretary
-10-