Amended and Restated Certificate of Incorporation

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This Amended and Restated Certificate of Incorporation is for use when amending an original certificate which often happens when a new class of stock (such as preferred stock) is to be sold.

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This Amended and Restated Certificate of Incorporation is for use when amending an original certificate of incorporation. Typically this form will be used after a new class of stock (“preferred stock”) is to be sold in a financing or debt arrangement. The preferred stock may have different rights with regard to voting, liquidation and conversion than the common stock of the company.

This certificate sets forth the name of the company, date the original certificate was filed and that the board of directors adopted certain resolutions that will amend the original certificate of incorporation.

This Amended and Restated Certificate of Incorporation includes:
  • Party: Sets forth the name of the company, state under which it is incorporated and purpose of the corporation;
  • Shares: Sets out the number of shares of common stock the company is authorized to issue, division of shares (common, preferred or Series A) and definition of each type of share;
  • Dividends: Specifies the treatment of each type of dividend;
  • Liquidation Rights: Provisions regarding liquidation rights of each type of stock and any remaining assets;
  • Voting: Except as otherwise expressly provided, holders of preferred and common stock shall vote together, and not as separate classes;
  • Bylaws: Board of Directors are authorized to adopt, amend or repeal the bylaws of the corporation but the stockholders may also make additional bylaws for adoption;
  • Signatures: This document must be signed by the chief executive officer of the corporation.

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This attorney-prepared packet contains:
  1. General Information
  2. Instructions and Checklist
  3. Amended and Restated Certificate of Incorporation
State Law Compliance: This form complies with the laws of all states
This is the content of the form and is provided for your convenience. It is not necessarily what the actual form looks like and does not include the information, instructions and other materials that come with the form you would purchase. An actual sample can also be viewed by clicking on the "Sample Form" near the top left of this page.
 
 
Amended and Restated
Certificate of Incorporation

 

 

________________________________ [COMPANY], a corporation organized and existing under and by virtue of the General Corporation Law of the State of _____________ (the Company”), does hereby certify that:
 
I. The name of the Company is ______________________________ [COMPANY];
II. The original Certificate of Incorporation of the Company was filed with the _____________ [state] Secretary of State on ________________________ [date]; and
III. The Board of Directors of the Company, acting in accordance with ___________________________________________________________ [citation of state statutes], and the stockholders of the Company, acting in accordance with ____________________________________________________________ [citation of state statutes], duly adopted resolutions and declared the advisability of such resolutions to amend and restate the Certificate of Incorporation of the Company to read in its entirety as follows:
 
ONE 
 
The name of the Company is ______________________________ [COMPANY].
 
TWO 
 
The address of the Companys registered office in the State of ________________ is ________ , in the City of ________ , County of ________ . The name of its registered agent at such address is ________ .
 
THREE 
 
The purpose of the Company is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of _____________ [state].
 
FOUR 
A. The aggregate number of shares that the company shall have authority to issue is ________  divided into _______________  shares of common stock (the Common Stock”) each with the par value of $[0.001] per share, and _______________  shares of preferred stock (the Preferred Stock”) each with the par value of $ _____ [value] per share. The Preferred Stock may be issued in one or more series, of which one such series shall be denominated the Series A Convertible Preferred Stock” and shall consist of _______________  shares.
B. The terms and provisions of the Preferred Stock are as follows:
 
1. Definitions. For purposes of this Article, the following definitions shall apply:
(a) Convertible Securities” shall mean any bonds, debentures, notes or other evidences of indebtedness, and any warrants, shares or any other securities (other than shares of Preferred Stock) convertible into, exercisable for, or exchangeable for Common Stock.
(b) Options” shall mean rights, options or warrants to subscribe for, purchase or otherwise acquire Common Stock or Convertible Securities.
(c) Original Issue Date” shall mean the date upon which shares of Series A Preferred Stock are first issued.
(d) Original Purchase Price” shall mean $[________ ] for each share of Series A Preferred Stock, subject to equitable and proportional adjustment in the event of stock splits, reverse splits, recapitalization and the like.
(e) Preferred Stock” shall mean all outstanding series of Preferred Stock, from time to time.
2. Dividends.
 
(a) Treatment of Preferred. The holders of Preferred Stock shall be entitled to receive annual dividends of ______________ [percentage] of the Original Purchase Price, out of any assets at the time legally available therefor, when, as and if declared by the Board of Directors (the Preferred Dividends”). The Board of Directors is under no obligation to declare dividends, no rights shall accrue to the holders of Preferred Stock if dividends are not declared, and any dividends declared shall be noncumulative. To the extent that the Company declares or pays dividends on the Common Stock, the Company shall declare and pay a participating dividend on each share of Preferred Stock on an as-converted basis; and no dividend shall be paid on the Common Stock at a rate greater than the rate at which dividends are paid on the Preferred Stock. The number of shares of Common Stock into which shares of Preferred Stock are convertible shall be determined as of the date on which the dividend is declared.
(b) Priority of Dividends. The Company shall make no Distribution (as defined below) to the holders of shares of Common Stock except in accordance with Section 2(a) above, and no Distributions shall be paid on any Common Stock of the Company during any fiscal year of the Company until the Preferred Dividends have been paid in full to the holders of Preferred Stock during that fiscal year.
(c) Distribution. As used in this section, Distribution” means the transfer of cash or property without consideration, whether by way of dividend or otherwise (except a dividend in shares of the Company) or the purchase of shares of the Company (other than in connection with the repurchase of shares of Common Stock issued to or held by employees, consultants, officers or directors pursuant to agreements providing for the right of such repurchase) for cash or property.
(d) Consent to Certain Repurchases. As authorized by ___________________________________________________ [citation of state statutes] shall not apply with respect to Distributions made by the Company in connection with the repurchase of shares of Common Stock issued to or held by employees, consultants, officers or directors at a price not greater than the amount paid by such person for such shares upon termination of their employment or services pursuant to agreements providing for the right of said repurchase, which agreements were authorized by the approval of the Companys Board of Directors.
3. Liquidation Rights.
(a) Preferred Stock Liquidation Preference. In the event of any liquidation, dissolution or winding up of the Company (Liquidation”), either voluntary or involuntary, the holders of the Preferred Stock shall be entitled to receive, out of the assets of the Company, the Original Purchase Price plus an amount equal to all declared and unpaid dividends thereon (the Liquidation Preference”), if any, to the date that payment is made, before any payment shall be made or any assets distributed to the holders of Common Stock. If upon the liquidation, dissolution or winding up of the Company, the assets to be distributed among the holders of the Preferred Stock are insufficient to permit the payment to such holders of the full Liquidation Preference for their shares, then the entire assets of the Company legally available for distribution shall be distributed with equal priority and pro rata among the holders of the Preferred Stock in proportion to the aggregate Liquidation Preference each such holder is otherwise entitled to receive.
(b) Preferred Stock Participation. After the payment to the holders of Preferred Stock of the full Liquidation Preference set forth above, the remaining assets of the Company, if any, shall be distributed to the holders of the Preferred Stock and the holders of the Common Stock pro rata (on an as-converted to Common Stock basis) until such time as the holders of Preferred Stock have received an amount equal to two times the Original Purchase Price in the aggregate pursuant to subsection (a) and this subsection (b).
(c) Remaining Assets. After the payment to the holders of Preferred Stock of the full preferential amounts specified above, no further payments shall be made to the holders of Preferred Stock, and any remaining assets of the Company shall be distributed with equal priority and pro rata among the holders of the Companys Common Stock.
(d) Reorganization. For purposes of this Section 3, a Liquidation shall be deemed to be occasioned by, or to include, (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger, consolidation or stock sale); provided, however, that the applicable transaction shall not be deemed a liquidation unless the Companys stockholders of record as constituted immediately prior to such acquisition or sale hold less than 50% of the voting power of the surviving or acquiring entity immediately after such acquisition or sale (by virtue of securities issued as consideration for such transaction) in the same relative proportions; or (b) a sale of all or substantially all of the assets of the Company (collectively, a Liquidation Event”).
(e) Shares not Treated as Both Preferred Stock and Common Stock in any Distribution. Shares of Preferred Stock shall not be entitled to be converted into shares of Common Stock in order to participate in any distribution, or series of distributions, as shares of Common Stock, without first foregoing participation in the distribution, or series of distributions, as shares of Preferred Stock.
(f) Non-Cash Consideration. If any property distributed to stockholders in connection with any liquidation, dissolution, or winding up of the Company are other than cash, then the value of such assets shall be their fair market value as determined by the Board of Directors, except that any securities to be distributed to stockholders in a liquidation, dissolution, or winding up of the Company shall be valued as follows:
(i) The method of valuation of securities not subject to investment letter or other similar restrictions on free marketability shall be as follows:
a. if the securities are then traded on a national securities exchange or the Nasdaq National Market (or a similar national quotation system), then the value shall be deemed to be the average of the closing prices of the securities on such exchange or system over the 30-day period ending three (3) days prior to the distribution;
b. if actively traded over-the-counter, then the value shall be deemed to be the average of the closing bid prices over the 30-day period ending three (3) days prior to the distribution; and
c. if there is no active public market, then the value shall be the fair market value thereof, as determined in good faith by the Board of Directors of the Company.
(ii) The method of valuation of securities subject to investment letter or other restrictions on free marketability shall be to make an appropriate discount from the market value determined as above in subparagraphs (1)(a), (1)(b) or (1)(c) of this subsection to reflect the approximate fair market value thereof, as determined in good faith by the Board of Directors.
 
4. Conversion. The Preferred Stock shall have conversion rights as follows (the “Conversion Rights”):
 
(a) Right to Convert. Each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share at the office of the Company or any transfer agent for the Preferred Stock. Each share of Series A Preferred Stock shall be convertible into that number of fully-paid and non-assessable shares of Common Stock that is equal to the Original Purchase Price divided by the Series A Conversion Price (as hereinafter defined). The Series A Conversion Price” shall initially be the Original Purchase Price, and shall be subject to adjustment as provided herein. The number of shares of Common Stock into which each share of Preferred Stock may be converted is hereinafter referred to as the Conversion Rate.
(b) Automatic Conversion. Each share of Preferred Stock shall automatically be converted into shares of Common Stock at the then effective Conversion Rate for such share immediately upon the earlier of (i) the closing of a firmly underwritten public offering pursuant to the Securities Act of 1933, as amended (the Securities Act”) on Form S-1 (as defined in the Securities Act), which results in aggregate gross cash proceeds to the Company of at least ______________________________ [amount] (net of underwriting discounts and commissions) (the Minimum IPO Price”) or (ii) the date specified by written consent or agreement of the holders of at least 50% of the then outstanding shares of Preferred Stock.
(c) Mechanics of Conversion. No fractional shares of Common Stock shall be issued upon conversion of the Preferred Stock. In lieu of any fractional shares to which the holder would otherwise be entitled, the Company shall pay cash equal to such fraction multiplied by the then fair market value of such fractional shares as determined in good faith by the Board of Directors (as evidenced by certified resolutions) of the Company. For such purpose, all shares of Preferred Stock held by each holder shall be aggregated, and any resulting fractional share of Common Stock shall be paid in cash. Before any holder of Preferred Stock shall be entitled to convert the same into full shares of Common Stock, and to receive certificates therefor, he shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Company or of any transfer agent for the Preferred Stock, and shall give written notice to the Company at such office that he elects to convert the same; provided, however, that in the event of an automatic conversion pursuant to paragraph 4(b) above, the outstanding shares of Preferred Stock 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 Company or its transfer agent; provided further, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such automatic conversion unless either the certificates evidencing such shares of Preferred Stock are delivered to the Company or its transfer agent as provided above, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates.
 
The Company shall, as soon as practicable after such delivery, or after such agreement and indemnification, issue and deliver at such office to such holder of Preferred Stock, a certificate or certificates for the number of shares of Common Stock to which he shall be entitled as aforesaid and a check payable to the holder in the amount of any cash amounts payable as the result of a conversion into fractional shares of Common Stock, plus any declared and unpaid dividends on the converted Preferred Stock. 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 Preferred Stock to be converted, and 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 on such date; provided, however, that if the conversion is in connection with an underwritten offer of securities registered pursuant to the Securities Act, the conversion may, at the option of any holder tendering Preferred Stock for conversion, be conditioned upon the closing of the sale of securities pursuant to such offering, in which event the person(s) entitled to receive the Common Stock issuable upon such conversion of the Preferred Stock shall not be deemed to have converted such Preferred Stock until immediately prior to the closing of the sale of such securities.
(d) Adjustments to Conversion Price for Diluting Issues.
 
(i) Special Definition. For purposes of this Section 4(d), Additional Shares of Common” shall mean all shares of Common Stock issued (or, pursuant to Section 4(d)(iii), deemed to be issued) by the Company after the Original Issue Date, other than:
a. shares of Common Stock issued or issuable upon conversion of shares of Preferred Stock;
b. shares of Common Stock issued or issuable to any employee, officer or director of, or consultant to, the Company pursuant to any plan or arrangement approved by the Board of Directors of the Company;
c. shares of Common Stock or other securities issued or issuable to any bank, equipment or real estate lesser or other similar financial institution pursuant to any transaction or arrangement approved by the Board of Directors of the Company;
d. shares of Common Stock or other securities issued or issuable as consideration for the acquisition of any business entity by the Company by merger, purchase of all or substantially all of the assets or capital stock of such entity, or other reorganization, each as approved by the Board of Directors of the Company, whereby the Company owns not less than a majority of the voting power of such entity (or the surviving or successor entity);
e. shares of Common Stock issued pursuant to a firmly underwritten public offering in connection with which all outstanding shares of Preferred Stock will be converted pursuant to Section 4(b) herein;
f. shares of Common Stock issued or issuable upon exercise of any warrants outstanding as of the Original Issue Date; and
g. shares of Common Stock issued or issuable as a dividend or distribution on Preferred Stock or pursuant to any event for which adjustment is made pursuant to Section 4(e) or (f) hereof.
(ii) No Adjustment of Conversion Price. No adjustment in the Conversion Price of any series of Preferred Stock shall be made in respect of the issuance of Additional Shares of Common unless the consideration per share for an Additional Share of Common issued or deemed to be issued by the Company is less than the Conversion Price in effect on the date of, and immediately prior to such issue, for such series of Preferred Stock. No adjustment in the Conversion Price otherwise required by this Section 4 shall affect any shares of Common Stock issued upon conversion of Preferred Stock prior to such adjustment.
(iii) Deemed Issue of Additional Shares of Common. In the event the Company at any time or from time to time after the Original Issue Date shall issue any Options or Convertible Securities or shall fix a record date for the determination of holders of any class of securities entitled to receive any such Options or Convertible Securities, then the maximum number of shares (as set forth in the instrument relating thereto without regard to any provisions contained therein for a subsequent adjustment of such number) of Common Stock issuable upon the exercise of such Options or, in the case of Convertible Securities and Options therefor, the conversion or exchange of such Convertible Securities or exercise of such Options, shall be deemed to be Additional Shares of Common issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date, provided that Additional Shares of Common shall not be deemed to have been issued unless the consideration per share (determined pursuant to Section 4(d)(v) hereof) of such Additional Shares of Common would be less than the Conversion Price for any series of Preferred Stock in effect on the date of and immediately prior to such issue or record date, as the case may be, and provided further that in any such case in which Additional Shares of Common are deemed to be issued:
a. no further adjustment in the Conversion Price for any series of Preferred Stock shall be made upon the subsequent issue of Convertible Securities or shares of Common Stock upon the exercise of such Options or conversion or exchange of such Convertible Securities or upon the subsequent issue of Options for Convertible Securities or shares of Common Stock;
b. if such Options or Convertible Securities by their terms provide, with the passage of time or otherwise, for any increase in the consideration payable to the Company, or decrease in the number of shares of Common Stock issuable, upon the exercise, conversion or exchange thereof, the Conversion Price for any series of Preferred Stock computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto), and any subsequent adjustments based thereon, shall, upon any such increase or decrease becoming effective, be recomputed to reflect such increase or decrease insofar as it affects such Options or the rights of conversion or exchange under such Convertible Securities;
c. no readjustment pursuant to clause (b) above shall have the effect of increasing the Conversion Price for any series of Preferred Stock to an amount which exceeds the lower of (i) the Conversion Price for such series of Preferred Stock on the original adjustment date, or (ii) the Conversion Price for such series of Preferred Stock that would have resulted from any issuance of Additional Shares of Common between the original adjustment date and such readjustment date;
d. upon the expiration of any such Options or any rights of conversion or exchange under such Convertible Securities which shall not have been exercised, the Conversion Price for any series of Preferred Stock computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto) and any subsequent adjustments based thereon shall, upon such expiration, be recomputed as if:
(i) in the case of Convertible Securities or Options for Common Stock, the only Additional Shares of Common issued were the shares of Common Stock, if any, actually issued upon the exercise of such Options or the conversion or exchange of such Convertible Securities and the consideration received therefor was the consideration actually received by the Company for the issue of such exercised Options plus the consideration actually received by the Company upon such exercise or for the issue of all such Convertible Securities which were actually converted or exchanged, plus the additional consideration, if any, actually received by the Company upon such conversion or exchange, and
(ii) in the case of Options for Convertible Securities, only the Convertible Securities, if any, actually issued upon the exercise thereof were issued at the time of issue of such Options, and the consideration received by the Company for the Additional Shares of Common deemed to have been then issued was the consideration actually received by the Company for the issue of such exercised Options, plus the consideration deemed to have been received by the Company (determined pursuant to Section 4(d)(v)) upon the issue of the Convertible Securities with respect to which such Options were actually exercised; and
e. if such record date shall have been fixed and such Options or Convertible Securities are not issued on the date fixed therefor, the adjustment previously made in the Conversion Price for any series of Preferred Stock which became effective on such record date shall be canceled as of the close of business on such record date, and thereafter the Conversion Prices for such series of Preferred Stock shall be adjusted pursuant to this Section 4(d)(iii) as of the actual date of their issuance.
(iv) Adjustment of Conversion Price Upon Issuance of Additional Shares of Common. In the event the Company, at any time after the Original Issue Date shall issue Additional Shares of Common (including Additional Shares of Common deemed to be issued pursuant to Section 4(d)(iii)) without consideration or for a consideration per share less than the Conversion Price for any series of Preferred Stock in effect on the date of and immediately prior to such issue, then and in such event, the Conversion Price for each such series of Preferred Stock shall be reduced, concurrently with such issue, to a price determined by multiplying such Conversion Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue, and all shares of Common Stock issuable upon conversion of Preferred Stock and exercise of all Options and Convertible Securities outstanding immediately prior to such issue plus the number of shares of Common Stock which the aggregate consideration received by the Company for the total number of Additional Shares of Common so issued would purchase at such Conversion Price, and the denominator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue and all shares of Common Stock issuable upon conversion of Preferred Stock and exercise of all Options and Convertible Securities outstanding immediately prior to such issue plus the number of such Additional Shares of Common so issued.
(v) Determination of Consideration. For purposes of this subsection 4(d), the consideration received by the Company for the issue of any Additional Shares of Common shall be computed as follows:
a. Cash and Property. Such consideration shall:
(i) insofar as it consists of cash, be computed at the aggregate amount of cash received by the Company excluding amounts paid or payable for accrued interest or accrued dividends and excluding any discounts, commissions or placement fees payable by the Company to any underwriter or placement agent in connection with the issuance of any Additional Shares of Common;
(ii) insofar as it consists of property other than cash, be computed at the fair value thereof at the time of such issue, as determined in good faith by the Board of Directors; and
(iii) in the event Additional Shares of Common are issued together with other shares or securities or other assets of the Company for consideration which covers both, be the proportion of such consideration so received, computed as provided in clauses (i) and (ii) above, as reasonably determined in good faith by the Board of Directors.
b. Options and Convertible Securities. The consideration per share received by the Company for Additional Shares of Common deemed to have been issued pursuant to Section 4(d)(iii), relating to Options and Convertible Securities, shall be determined by dividing
(i) the total amount, if any, received or receivable by the Company as consideration for the issue of such Options or Convertible Securities (determined in the manner described in subsection (a) above), plus the minimum aggregate amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration) payable to the Company upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities by
(ii) the maximum number of shares of Common Stock (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon the exercise of such Options or the conversion or exchange of such Convertible Securities.
(e) Adjustments for Stock Dividends, Subdivisions or Combinations of Common. In the event that the Company at any time after the Original Issue Date shall declare or pay without consideration any dividends on the Common Stock payable in Common Stock or in any right to acquire Common Stock, or in the event the outstanding shares of Common Stock shall be subdivided (by stock split or otherwise than by payment of a dividend in Common Stock and without a corresponding adjustment to the Preferred Stock), into a greater number of shares of Common Stock, the Conversion Price for each series of Preferred Stock in effect immediately prior to such subdivision shall, concurrently with the effectiveness of such subdivision, be proportionately decreased. In the event the outstanding shares of Common Stock shall be combined (by reclassification or otherwise) into a lesser number of shares of Common Stock and without a corresponding adjustment to the Preferred Stock, the Conversion Price for each series of Preferred Stock in effect immediately prior to such combination shall, concurrently with the effectiveness of such combination, be proportionately increased.
(f) Adjustments for Reclassification, Exchange and Substitution. If the Common Stock issuable upon conversion of any series of Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination of shares provided for above or a transaction subject to Section 3(c)), then, concurrently with the effectiveness of such reorganization or reclassification, each series of Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders would otherwise have been entitled to receive, a number of shares of such other class or classes of stock which a holder of the number of shares of Common Stock deliverable upon conversion of such series of Preferred Stock immediately before that change would have been entitled to receive in such reorganization or reclassification.
(g) Certificate of Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price of any series of Preferred Stock pursuant to this Section 4, the Company at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each holder of such series of Preferred Stock a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall, upon the written request at any time of any holder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Conversion Prices at the time in effect, and (iii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of Preferred Stock.
(h) Notices of Record Date. In the event that the Company shall propose at any time (i) to declare any dividend or distribution upon its Common Stock, whether in cash, property, stock or other securities, whether or not a regular cash dividend and whether or not out of earnings or earned surplus; (ii) to offer for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights; (iii) to effect any reclassification or recapitalization of its Common Stock outstanding involving a change in the Common Stock; or (iv) to merge with or into any other corporation, or sell, lease or convey all or substantially all its property or business, or to liquidate, dissolve or wind up (including any Liquidation Event); then, in connection with each such event, the Company shall send to the holders of the Preferred Stock at least 20 days prior written notice of the date on which a record shall be taken for such dividend, distribution or subscription rights (and specifying the date on which the holders of Common Stock shall be entitled thereto) or for determining rights to vote in respect of the matters referred to in clauses (iii) and (iv) above. Each such written notice shall be given by first class mail, postage prepaid, or reputable overnight courier, or personally delivered, addressed to the holders of Preferred Stock at the address for each such holder as shown on the books of the Company (with the date such notice is deemed given to be three days after such deposit in the U.S. Mail, the business day after deposit with a reputable overnight courier and upon delivery in the case of personal delivery).
(i) Reservation of Stock Issuable Upon Conversion. The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all then outstanding shares of the Preferred Stock; and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Preferred Stock, the Company 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 to such number of shares as shall be sufficient for such purpose.
(j) No Impairment. The Company will not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action (including any Liquidation Event), avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such action as may be necessary or appropriate in order to protect the conversion rights of the holders of the Preferred Stock against impairment.
5. Redemption. The Preferred Stock is not redeemable.
6. Voting. Except as otherwise expressly provided herein or as required by law, the holders of Preferred Stock and the holders of Common Stock shall vote together and not as separate classes.
 
(a) Preferred Stock. Each holder of shares of Preferred Stock shall be entitled to the number of votes equal to the number of shares of Common Stock into which such shares of Preferred Stock held by such holder of Preferred Stock could then be converted. The holders of shares of the Preferred Stock shall be entitled to vote on all matters on which the Common Stock shall be entitled to vote except as otherwise provided herein or as required by law. The holders of the Preferred Stock shall be entitled to notice of any stockholders meeting in accordance with the bylaws of the Company. Fractional votes shall not, however, be permitted and any fractional voting rights resulting from the above formula (after aggregating all shares into which shares of Preferred Stock held by each holder could be converted), shall be rounded up to the next highest whole number.
(b) Common Stock. Each holder of shares of Common Stock shall be entitled to one vote for each share thereof held.
(c) Election of Directors. The holders of the Series A Preferred Stock, voting together as a single class, shall be entitled to elect ____ [number of directors] directors, so long as at least __________ [number of shares] shares of Series A Preferred Stock (as adjusted for splits, reverse splits, recapitalizations and the like) remain outstanding (the Series A Directors”). The holders of the Common Stock, voting together as a single class, shall be entitled to elect ______ [number of directors] directors (the Common Directors”). One director shall be elected by the vote of at least a majority of Common Stock voting together as a single class and the vote of at least a majority of the Series A Preferred Stock voting together as a single class (the Joint Director”). The holders of Preferred Stock and Common Stock, voting together as a single class, shall be entitled to elect all additional directors, if any (the At-Large Directors”).
(d) Vacancies; Removal. In the case of any vacancy in the office of a director last held by a director described in the preceding subsection (c) as a Series A Director, Common Director, Joint Director or At-Large Director, as the case may be (a Vacant Directorship”), the remaining director or directors of such description may (or, if there is then no director of such description remaining in office, the holders of the outstanding shares of the class, classes or series previously represented by the Vacant Directorships may), by affirmative vote of the applicable majority (or, in the case of a Vacant Directorship of a Joint Director, majorities) thereof, elect a successor to hold the Vacant Directorship for the unexpired term of the previous incumbent director. The holders of the outstanding shares of the class, classes or series given the authority to elect a director in subsection (c) may also remove such director during their term of office, whether with or without cause, by the affirmative vote of the applicable majority (or, in the case of the Joint Director, majorities) of such holders.
7. Protective Provisions. In addition to any other class vote that may be required by law, the Company shall not without first obtaining the approval (by vote or written consent, as provided by law) of the holders of at least a majority of the then outstanding shares of Preferred Stock, voting together as a single class:
(a) amend or repeal any provisions of the Certificate of Incorporation or By-laws, adversely change the rights, preferences or privileges of any series of Preferred Stock or increase or decrease the number of shares of Preferred Stock or Common Stock;
(b) create (by amendment of the Certificate of Incorporation, reclassification, certificate of designation or otherwise) any new class or series of shares having rights, preferences or privilege senior to or on a parity with any series of Preferred Stock;
(c) make any distribution contemplated by Section 305 of the Internal Revenue Code of 1986, as amended, or the regulations promulgated there under;
(d) declare or pay or set aside for payment any dividend (other than dividends payable in stock of the Company);
(e) cancel, exchange, reclassify, redeem, purchase or otherwise acquire any shares of the Companys capital stock other than pursuant to repurchase agreements with employees or consultants;
(f) authorize a Liquidation or Liquidation Event; or
(g) change the number of directors to a number other than ____ [number].
8. Notices. Any notice required by the provisions of this Article FOUR to be given to the holders of Preferred Stock shall be, and shall be deemed, given as provided above in Section 4(h) (“Notices of Record Date”).
 
FIVE 
 
The Board of Directors of the Company is expressly authorized to adopt, amend or repeal the bylaws of Company, but the stockholders may make additional bylaws and may alter or repeal any bylaws whether adopted by them or otherwise, in all cases subject to the requirements of Article FOUR.
 
 
 
SIX  
Elections of directors need not be by written ballot except and to the extent provided in the bylaws of the Company.
 
SEVEN 
A. To the fullest extent permitted by the _____________ [state] General Corporation Law as the same exists or as may hereafter be amended, a director of the Company shall not be personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director.
 
B. The Company shall indemnify to the fullest extent permitted by law any person made or threatened to be made a party to an action or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that he, his testator or intestate is or was a director, officer or employee of the Company or any predecessor of the Company or serves or served any other enterprise as a director, officer or employee at the request of the Company or any predecessor to the Company.
 
C. Neither any amendment nor repeal of this Article SEVEN nor the adoption of any provision of this Companys Certificate of Incorporation inconsistent with this Article SEVEN, shall eliminate or reduce the effect of this Article SEVEN in respect of any matter occurring, or any action or proceeding accruing or arising or that, but for this Article SEVEN, would accrue or arise, prior to such amendment, repeal or adoption of an inconsistent provision.
 
D. Thereafter, pursuant to a resolution of the Board of Directors, this Amended and Restated Certificate of Incorporation was duly approved by the holders of the necessary number of shares of the Companys voting securities in accordance with the provisions of ____________________________________________________________________ [citation of state statutes].
 
 
* * *
 
IN WITNESS WHEREOF, the Company has caused this certificate to be signed by its duly authorized officer this _____________________________ [date].
 
_______________
[Name] 
 
[Chief Executive Officer]
 
 
 
 
 
 
 
Number of Pages17
DimensionsDesigned for Letter Size (8.5" x 11")
EditableYes (.doc, .wpd and .rtf)
UsageUnlimited number of prints
Product number#43680
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Amended and Restated
Certificate of Incorporation

 

 

________________________________ [COMPANY], a corporation organized and existing under and by virtue of the General Corporation Law of the State of _____________ (the Company”), does hereby certify that:
 
I. The name of the Company is ______________________________ [COMPANY];
II. The original Certificate of Incorporation of the Company was filed with the _____________ [state] Secretary of State on ________________________ [date]; and
III. The Board of Directors of the Company, acting in accordance with ___________________________________________________________ [citation of state statutes], and the stockholders of the Company, acting in accordance with ____________________________________________________________ [citation of state statutes], duly adopted resolutions and declared the advisability of such resolutions to amend and restate the Certificate of Incorporation of the Company to read in its entirety as follows:
 
ONE 
 
The name of the Company is ______________________________ [COMPANY].
 
TWO 
 
The address of the Companys registered office in the State of ________________ is ________ , in the City of ________ , County of ________ . The name of its registered agent at such address is ________ .
 
THREE 
 
The purpose of the Company is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of _____________ [state].
 
FOUR 
A. The aggregate number of shares that the company shall have authority to issue is ________  divided into _______________  shares of common stock (the Common Stock”) each with the par value of $[0.001] per share, and _______________  shares of preferred stock (the Preferred Stock”) each with the par value of $ _____ [value] per share. The Preferred Stock may be issued in one or more series, of which one such series shall be denominated the Series A Convertible Preferred Stock” and shall consist of _______________  shares.
B. The terms and provisions of the Preferred Stock are as follows:
 
1. Definitions. For purposes of this Article, the following definitions shall apply:
(a) Convertible Securities” shall mean any bonds, debentures, notes or other evidences of indebtedness, and any warrants, shares or any other securities (other than shares of Preferred Stock) convertible into, exercisable for, or exchangeable for Common Stock.
(b) Options” shall mean rights, options or warrants to subscribe for, purchase or otherwise acquire Common Stock or Convertible Securities.
(c) Original Issue Date” shall mean the date upon which shares of Series A Preferred Stock are first issued.
(d) Original Purchase Price” shall mean $[________ ] for each share of Series A Preferred Stock, subject to equitable and proportional adjustment in the event of stock splits, reverse splits, recapitalization and the like.
(e) Preferred Stock” shall mean all outstanding series of Preferred Stock, from time to time.
2. Dividends.
 
(a) Treatment of Preferred. The holders of Preferred Stock shall be entitled to receive annual dividends of ______________ [percentage] of the Original Purchase Price, out of any assets at the time legally available therefor, when, as and if declared by the Board of Directors (the Preferred Dividends”). The Board of Directors is under no obligation to declare dividends, no rights shall accrue to the holders of Preferred Stock if dividends are not declared, and any dividends declared shall be noncumulative. To the extent that the Company declares or pays dividends on the Common Stock, the Company shall declare and pay a participating dividend on each share of Preferred Stock on an as-converted basis; and no dividend shall be paid on the Common Stock at a rate greater than the rate at which dividends are paid on the Preferred Stock. The number of shares of Common Stock into which shares of Preferred Stock are convertible shall be determined as of the date on which the dividend is declared.
(b) Priority of Dividends. The Company shall make no Distribution (as defined below) to the holders of shares of Common Stock except in accordance with Section 2(a) above, and no Distributions shall be paid on any Common Stock of the Company during any fiscal year of the Company until the Preferred Dividends have been paid in full to the holders of Preferred Stock during that fiscal year.
(c) Distribution. As used in this section, Distribution” means the transfer of cash or property without consideration, whether by way of dividend or otherwise (except a dividend in shares of the Company) or the purchase of shares of the Company (other than in connection with the repurchase of shares of Common Stock issued to or held by employees, consultants, officers or directors pursuant to agreements providing for the right of such repurchase) for cash or property.
(d) Consent to Certain Repurchases. As authorized by ___________________________________________________ [citation of state statutes] shall not apply with respect to Distributions made by the Company in connection with the repurchase of shares of Common Stock issued to or held by employees, consultants, officers or directors at a price not greater than the amount paid by such person for such shares upon termination of their employment or services pursuant to agreements providing for the right of said repurchase, which agreements were authorized by the approval of the Companys Board of Directors.
3. Liquidation Rights.
(a) Preferred Stock Liquidation Preference. In the event of any liquidation, dissolution or winding up of the Company (Liquidation”), either voluntary or involuntary, the holders of the Preferred Stock shall be entitled to receive, out of the assets of the Company, the Original Purchase Price plus an amount equal to all declared and unpaid dividends thereon (the Liquidation Preference”), if any, to the date that payment is made, before any payment shall be made or any assets distributed to the holders of Common Stock. If upon the liquidation, dissolution or winding up of the Company, the assets to be distributed among the holders of the Preferred Stock are insufficient to permit the payment to such holders of the full Liquidation Preference for their shares, then the entire assets of the Company legally available for distribution shall be distributed with equal priority and pro rata among the holders of the Preferred Stock in proportion to the aggregate Liquidation Preference each such holder is otherwise entitled to receive.
(b) Preferred Stock Participation. After the payment to the holders of Preferred Stock of the full Liquidation Preference set forth above, the remaining assets of the Company, if any, shall be distributed to the holders of the Preferred Stock and the holders of the Common Stock pro rata (on an as-converted to Common Stock basis) until such time as the holders of Preferred Stock have received an amount equal to two times the Original Purchase Price in the aggregate pursuant to subsection (a) and this subsection (b).
(c) Remaining Assets. After the payment to the holders of Preferred Stock of the full preferential amounts specified above, no further payments shall be made to the holders of Preferred Stock, and any remaining assets of the Company shall be distributed with equal priority and pro rata among the holders of the Companys Common Stock.
(d) Reorganization. For purposes of this Section 3, a Liquidation shall be deemed to be occasioned by, or to include, (a) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger, consolidation or stock sale); provided, however, that the applicable transaction shall not be deemed a liquidation unless the Companys stockholders of record as constituted immediately prior to such acquisition or sale hold less than 50% of the voting power of the surviving or acquiring entity immediately after such acquisition or sale (by virtue of securities issued as consideration for such transaction) in the same relative proportions; or (b) a sale of all or substantially all of the assets of the Company (collectively, a Liquidation Event”).
(e) Shares not Treated as Both Preferred Stock and Common Stock in any Distribution. Shares of Preferred Stock shall not be entitled to be converted into shares of Common Stock in order to participate in any distribution, or series of distributions, as shares of Common Stock, without first foregoing participation in the distribution, or series of distributions, as shares of Preferred Stock.
(f) Non-Cash Consideration. If any property distributed to stockholders in connection with any liquidation, dissolution, or winding up of the Company are other than cash, then the value of such assets shall be their fair market value as determined by the Board of Directors, except that any securities to be distributed to stockholders in a liquidation, dissolution, or winding up of the Company shall be valued as follows:
(i) The method of valuation of securities not subject to investment letter or other similar restrictions on free marketability shall be as follows:
a. if the securities are then traded on a national securities exchange or the Nasdaq National Market (or a similar national quotation system), then the value shall be deemed to be the average of the closing prices of the securities on such exchange or system over the 30-day period ending three (3) days prior to the distribution;
b. if actively traded over-the-counter, then the value shall be deemed to be the average of the closing bid prices over the 30-day period ending three (3) days prior to the distribution; and
c. if there is no active public market, then the value shall be the fair market value thereof, as determined in good faith by the Board of Directors of the Company.
(ii) The method of valuation of securities subject to investment letter or other restrictions on free marketability shall be to make an appropriate discount from the market value determined as above in subparagraphs (1)(a), (1)(b) or (1)(c) of this subsection to reflect the approximate fair market value thereof, as determined in good faith by the Board of Directors.
 
4. Conversion. The Preferred Stock shall have conversion rights as follows (the “Conversion Rights”):
 
(a) Right to Convert. Each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share at the office of the Company or any transfer agent for the Preferred Stock. Each share of Series A Preferred Stock shall be convertible into that number of fully-paid and non-assessable shares of Common Stock that is equal to the Original Purchase Price divided by the Series A Conversion Price (as hereinafter defined). The Series A Conversion Price” shall initially be the Original Purchase Price, and shall be subject to adjustment as provided herein. The number of shares of Common Stock into which each share of Preferred Stock may be converted is hereinafter referred to as the Conversion Rate.
(b) Automatic Conversion. Each share of Preferred Stock shall automatically be converted into shares of Common Stock at the then effective Conversion Rate for such share immediately upon the earlier of (i) the closing of a firmly underwritten public offering pursuant to the Securities Act of 1933, as amended (the Securities Act”) on Form S-1 (as defined in the Securities Act), which results in aggregate gross cash proceeds to the Company of at least ______________________________ [amount] (net of underwriting discounts and commissions) (the Minimum IPO Price”) or (ii) the date specified by written consent or agreement of the holders of at least 50% of the then outstanding shares of Preferred Stock.
(c) Mechanics of Conversion. No fractional shares of Common Stock shall be issued upon conversion of the Preferred Stock. In lieu of any fractional shares to which the holder would otherwise be entitled, the Company shall pay cash equal to such fraction multiplied by the then fair market value of such fractional shares as determined in good faith by the Board of Directors (as evidenced by certified resolutions) of the Company. For such purpose, all shares of Preferred Stock held by each holder shall be aggregated, and any resulting fractional share of Common Stock shall be paid in cash. Before any holder of Preferred Stock shall be entitled to convert the same into full shares of Common Stock, and to receive certificates therefor, he shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Company or of any transfer agent for the Preferred Stock, and shall give written notice to the Company at such office that he elects to convert the same; provided, however, that in the event of an automatic conversion pursuant to paragraph 4(b) above, the outstanding shares of Preferred Stock 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 Company or its transfer agent; provided further, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such automatic conversion unless either the certificates evidencing such shares of Preferred Stock are delivered to the Company or its transfer agent as provided above, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates.
 
The Company shall, as soon as practicable after such delivery, or after such agreement and indemnification, issue and deliver at such office to such holder of Preferred Stock, a certificate or certificates for the number of shares of Common Stock to which he shall be entitled as aforesaid and a check payable to the holder in the amount of any cash amounts payable as the result of a conversion into fractional shares of Common Stock, plus any declared and unpaid dividends on the converted Preferred Stock. 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 Preferred Stock to be converted, and 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 on such date; provided, however, that if the conversion is in connection with an underwritten offer of securities registered pursuant to the Securities Act, the conversion may, at the option of any holder tendering Preferred Stock for conversion, be conditioned upon the closing of the sale of securities pursuant to such offering, in which event the person(s) entitled to receive the Common Stock issuable upon such conversion of the Preferred Stock shall not be deemed to have converted such Preferred Stock until immediately prior to the closing of the sale of such securities.
(d) Adjustments to Conversion Price for Diluting Issues.
 
(i) Special Definition. For purposes of this Section 4(d), Additional Shares of Common” shall mean all shares of Common Stock issued (or, pursuant to Section 4(d)(iii), deemed to be issued) by the Company after the Original Issue Date, other than:
a. shares of Common Stock issued or issuable upon conversion of shares of Preferred Stock;
b. shares of Common Stock issued or issuable to any employee, officer or director of, or consultant to, the Company pursuant to any plan or arrangement approved by the Board of Directors of the Company;
c. shares of Common Stock or other securities issued or issuable to any bank, equipment or real estate lesser or other similar financial institution pursuant to any transaction or arrangement approved by the Board of Directors of the Company;
d. shares of Common Stock or other securities issued or issuable as consideration for the acquisition of any business entity by the Company by merger, purchase of all or substantially all of the assets or capital stock of such entity, or other reorganization, each as approved by the Board of Directors of the Company, whereby the Company owns not less than a majority of the voting power of such entity (or the surviving or successor entity);
e. shares of Common Stock issued pursuant to a firmly underwritten public offering in connection with which all outstanding shares of Preferred Stock will be converted pursuant to Section 4(b) herein;
f. shares of Common Stock issued or issuable upon exercise of any warrants outstanding as of the Original Issue Date; and
g. shares of Common Stock issued or issuable as a dividend or distribution on Preferred Stock or pursuant to any event for which adjustment is made pursuant to Section 4(e) or (f) hereof.
(ii) No Adjustment of Conversion Price. No adjustment in the Conversion Price of any series of Preferred Stock shall be made in respect of the issuance of Additional Shares of Common unless the consideration per share for an Additional Share of Common issued or deemed to be issued by the Company is less than the Conversion Price in effect on the date of, and immediately prior to such issue, for such series of Preferred Stock. No adjustment in the Conversion Price otherwise required by this Section 4 shall affect any shares of Common Stock issued upon conversion of Preferred Stock prior to such adjustment.
(iii) Deemed Issue of Additional Shares of Common. In the event the Company at any time or from time to time after the Original Issue Date shall issue any Options or Convertible Securities or shall fix a record date for the determination of holders of any class of securities entitled to receive any such Options or Convertible Securities, then the maximum number of shares (as set forth in the instrument relating thereto without regard to any provisions contained therein for a subsequent adjustment of such number) of Common Stock issuable upon the exercise of such Options or, in the case of Convertible Securities and Options therefor, the conversion or exchange of such Convertible Securities or exercise of such Options, shall be deemed to be Additional Shares of Common issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date, provided that Additional Shares of Common shall not be deemed to have been issued unless the consideration per share (determined pursuant to Section 4(d)(v) hereof) of such Additional Shares of Common would be less than the Conversion Price for any series of Preferred Stock in effect on the date of and immediately prior to such issue or record date, as the case may be, and provided further that in any such case in which Additional Shares of Common are deemed to be issued:
a. no further adjustment in the Conversion Price for any series of Preferred Stock shall be made upon the subsequent issue of Convertible Securities or shares of Common Stock upon the exercise of such Options or conversion or exchange of such Convertible Securities or upon the subsequent issue of Options for Convertible Securities or shares of Common Stock;
b. if such Options or Convertible Securities by their terms provide, with the passage of time or otherwise, for any increase in the consideration payable to the Company, or decrease in the number of shares of Common Stock issuable, upon the exercise, conversion or exchange thereof, the Conversion Price for any series of Preferred Stock computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto), and any subsequent adjustments based thereon, shall, upon any such increase or decrease becoming effective, be recomputed to reflect such increase or decrease insofar as it affects such Options or the rights of conversion or exchange under such Convertible Securities;
c. no readjustment pursuant to clause (b) above shall have the effect of increasing the Conversion Price for any series of Preferred Stock to an amount which exceeds the lower of (i) the Conversion Price for such series of Preferred Stock on the original adjustment date, or (ii) the Conversion Price for such series of Preferred Stock that would have resulted from any issuance of Additional Shares of Common between the original adjustment date and such readjustment date;
d. upon the expiration of any such Options or any rights of conversion or exchange under such Convertible Securities which shall not have been exercised, the Conversion Price for any series of Preferred Stock computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto) and any subsequent adjustments based thereon shall, upon such expiration, be recomputed as if:
(i) in the case of Convertible Securities or Options for Common Stock, the only Additional Shares of Common issued were the shares of Common Stock, if any, actually issued upon the exercise of such Options or the conversion or exchange of such Convertible Securities and the consideration received therefor was the consideration actually received by the Company for the issue of such exercised Options plus the consideration actually received by the Company upon such exercise or for the issue of all such Convertible Securities which were actually converted or exchanged, plus the additional consideration, if any, actually received by the Company upon such conversion or exchange, and
(ii) in the case of Options for Convertible Securities, only the Convertible Securities, if any, actually issued upon the exercise thereof were issued at the time of issue of such Options, and the consideration received by the Company for the Additional Shares of Common deemed to have been then issued was the consideration actually received by the Company for the issue of such exercised Options, plus the consideration deemed to have been received by the Company (determined pursuant to Section 4(d)(v)) upon the issue of the Convertible Securities with respect to which such Options were actually exercised; and
e. if such record date shall have been fixed and such Options or Convertible Securities are not issued on the date fixed therefor, the adjustment previously made in the Conversion Price for any series of Preferred Stock which became effective on such record date shall be canceled as of the close of business on such record date, and thereafter the Conversion Prices for such series of Preferred Stock shall be adjusted pursuant to this Section 4(d)(iii) as of the actual date of their issuance.
(iv) Adjustment of Conversion Price Upon Issuance of Additional Shares of Common. In the event the Company, at any time after the Original Issue Date shall issue Additional Shares of Common (including Additional Shares of Common deemed to be issued pursuant to Section 4(d)(iii)) without consideration or for a consideration per share less than the Conversion Price for any series of Preferred Stock in effect on the date of and immediately prior to such issue, then and in such event, the Conversion Price for each such series of Preferred Stock shall be reduced, concurrently with such issue, to a price determined by multiplying such Conversion Price by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue, and all shares of Common Stock issuable upon conversion of Preferred Stock and exercise of all Options and Convertible Securities outstanding immediately prior to such issue plus the number of shares of Common Stock which the aggregate consideration received by the Company for the total number of Additional Shares of Common so issued would purchase at such Conversion Price, and the denominator of which shall be the number of shares of Common Stock outstanding immediately prior to such issue and all shares of Common Stock issuable upon conversion of Preferred Stock and exercise of all Options and Convertible Securities outstanding immediately prior to such issue plus the number of such Additional Shares of Common so issued.
(v) Determination of Consideration. For purposes of this subsection 4(d), the consideration received by the Company for the issue of any Additional Shares of Common shall be computed as follows:
a. Cash and Property. Such consideration shall:
(i) insofar as it consists of cash, be computed at the aggregate amount of cash received by the Company excluding amounts paid or payable for accrued interest or accrued dividends and excluding any discounts, commissions or placement fees payable by the Company to any underwriter or placement agent in connection with the issuance of any Additional Shares of Common;
(ii) insofar as it consists of property other than cash, be computed at the fair value thereof at the time of such issue, as determined in good faith by the Board of Directors; and
(iii) in the event Additional Shares of Common are issued together with other shares or securities or other assets of the Company for consideration which covers both, be the proportion of such consideration so received, computed as provided in clauses (i) and (ii) above, as reasonably determined in good faith by the Board of Directors.
b. Options and Convertible Securities. The consideration per share received by the Company for Additional Shares of Common deemed to have been issued pursuant to Section 4(d)(iii), relating to Options and Convertible Securities, shall be determined by dividing
(i) the total amount, if any, received or receivable by the Company as consideration for the issue of such Options or Convertible Securities (determined in the manner described in subsection (a) above), plus the minimum aggregate amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration) payable to the Company upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities by
(ii) the maximum number of shares of Common Stock (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon the exercise of such Options or the conversion or exchange of such Convertible Securities.
(e) Adjustments for Stock Dividends, Subdivisions or Combinations of Common. In the event that the Company at any time after the Original Issue Date shall declare or pay without consideration any dividends on the Common Stock payable in Common Stock or in any right to acquire Common Stock, or in the event the outstanding shares of Common Stock shall be subdivided (by stock split or otherwise than by payment of a dividend in Common Stock and without a corresponding adjustment to the Preferred Stock), into a greater number of shares of Common Stock, the Conversion Price for each series of Preferred Stock in effect immediately prior to such subdivision shall, concurrently with the effectiveness of such subdivision, be proportionately decreased. In the event the outstanding shares of Common Stock shall be combined (by reclassification or otherwise) into a lesser number of shares of Common Stock and without a corresponding adjustment to the Preferred Stock, the Conversion Price for each series of Preferred Stock in effect immediately prior to such combination shall, concurrently with the effectiveness of such combination, be proportionately increased.
(f) Adjustments for Reclassification, Exchange and Substitution. If the Common Stock issuable upon conversion of any series of Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination of shares provided for above or a transaction subject to Section 3(c)), then, concurrently with the effectiveness of such reorganization or reclassification, each series of Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders would otherwise have been entitled to receive, a number of shares of such other class or classes of stock which a holder of the number of shares of Common Stock deliverable upon conversion of such series of Preferred Stock immediately before that change would have been entitled to receive in such reorganization or reclassification.
(g) Certificate of Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price of any series of Preferred Stock pursuant to this Section 4, the Company at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each holder of such series of Preferred Stock a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall, upon the written request at any time of any holder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Conversion Prices at the time in effect, and (iii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of Preferred Stock.
(h) Notices of Record Date. In the event that the Company shall propose at any time (i) to declare any dividend or distribution upon its Common Stock, whether in cash, property, stock or other securities, whether or not a regular cash dividend and whether or not out of earnings or earned surplus; (ii) to offer for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights; (iii) to effect any reclassification or recapitalization of its Common Stock outstanding involving a change in the Common Stock; or (iv) to merge with or into any other corporation, or sell, lease or convey all or substantially all its property or business, or to liquidate, dissolve or wind up (including any Liquidation Event); then, in connection with each such event, the Company shall send to the holders of the Preferred Stock at least 20 days prior written notice of the date on which a record shall be taken for such dividend, distribution or subscription rights (and specifying the date on which the holders of Common Stock shall be entitled thereto) or for determining rights to vote in respect of the matters referred to in clauses (iii) and (iv) above. Each such written notice shall be given by first class mail, postage prepaid, or reputable overnight courier, or personally delivered, addressed to the holders of Preferred Stock at the address for each such holder as shown on the books of the Company (with the date such notice is deemed given to be three days after such deposit in the U.S. Mail, the business day after deposit with a reputable overnight courier and upon delivery in the case of personal delivery).
(i) Reservation of Stock Issuable Upon Conversion. The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all then outstanding shares of the Preferred Stock; and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Preferred Stock, the Company 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 to such number of shares as shall be sufficient for such purpose.
(j) No Impairment. The Company will not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action (including any Liquidation Event), avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such action as may be necessary or appropriate in order to protect the conversion rights of the holders of the Preferred Stock against impairment.
5. Redemption. The Preferred Stock is not redeemable.
6. Voting. Except as otherwise expressly provided herein or as required by law, the holders of Preferred Stock and the holders of Common Stock shall vote together and not as separate classes.
 
(a) Preferred Stock. Each holder of shares of Preferred Stock shall be entitled to the number of votes equal to the number of shares of Common Stock into which such shares of Preferred Stock held by such holder of Preferred Stock could then be converted. The holders of shares of the Preferred Stock shall be entitled to vote on all matters on which the Common Stock shall be entitled to vote except as otherwise provided herein or as required by law. The holders of the Preferred Stock shall be entitled to notice of any stockholders meeting in accordance with the bylaws of the Company. Fractional votes shall not, however, be permitted and any fractional voting rights resulting from the above formula (after aggregating all shares into which shares of Preferred Stock held by each holder could be converted), shall be rounded up to the next highest whole number.
(b) Common Stock. Each holder of shares of Common Stock shall be entitled to one vote for each share thereof held.
(c) Election of Directors. The holders of the Series A Preferred Stock, voting together as a single class, shall be entitled to elect ____ [number of directors] directors, so long as at least __________ [number of shares] shares of Series A Preferred Stock (as adjusted for splits, reverse splits, recapitalizations and the like) remain outstanding (the Series A Directors”). The holders of the Common Stock, voting together as a single class, shall be entitled to elect ______ [number of directors] directors (the Common Directors”). One director shall be elected by the vote of at least a majority of Common Stock voting together as a single class and the vote of at least a majority of the Series A Preferred Stock voting together as a single class (the Joint Director”). The holders of Preferred Stock and Common Stock, voting together as a single class, shall be entitled to elect all additional directors, if any (the At-Large Directors”).
(d) Vacancies; Removal. In the case of any vacancy in the office of a director last held by a director described in the preceding subsection (c) as a Series A Director, Common Director, Joint Director or At-Large Director, as the case may be (a Vacant Directorship”), the remaining director or directors of such description may (or, if there is then no director of such description remaining in office, the holders of the outstanding shares of the class, classes or series previously represented by the Vacant Directorships may), by affirmative vote of the applicable majority (or, in the case of a Vacant Directorship of a Joint Director, majorities) thereof, elect a successor to hold the Vacant Directorship for the unexpired term of the previous incumbent director. The holders of the outstanding shares of the class, classes or series given the authority to elect a director in subsection (c) may also remove such director during their term of office, whether with or without cause, by the affirmative vote of the applicable majority (or, in the case of the Joint Director, majorities) of such holders.
7. Protective Provisions. In addition to any other class vote that may be required by law, the Company shall not without first obtaining the approval (by vote or written consent, as provided by law) of the holders of at least a majority of the then outstanding shares of Preferred Stock, voting together as a single class:
(a) amend or repeal any provisions of the Certificate of Incorporation or By-laws, adversely change the rights, preferences or privileges of any series of Preferred Stock or increase or decrease the number of shares of Preferred Stock or Common Stock;
(b) create (by amendment of the Certificate of Incorporation, reclassification, certificate of designation or otherwise) any new class or series of shares having rights, preferences or privilege senior to or on a parity with any series of Preferred Stock;
(c) make any distribution contemplated by Section 305 of the Internal Revenue Code of 1986, as amended, or the regulations promulgated there under;
(d) declare or pay or set aside for payment any dividend (other than dividends payable in stock of the Company);
(e) cancel, exchange, reclassify, redeem, purchase or otherwise acquire any shares of the Companys capital stock other than pursuant to repurchase agreements with employees or consultants;
(f) authorize a Liquidation or Liquidation Event; or
(g) change the number of directors to a number other than ____ [number].
8. Notices. Any notice required by the provisions of this Article FOUR to be given to the holders of Preferred Stock shall be, and shall be deemed, given as provided above in Section 4(h) (“Notices of Record Date”).
 
FIVE 
 
The Board of Directors of the Company is expressly authorized to adopt, amend or repeal the bylaws of Company, but the stockholders may make additional bylaws and may alter or repeal any bylaws whether adopted by them or otherwise, in all cases subject to the requirements of Article FOUR.
 
 
 
SIX  
Elections of directors need not be by written ballot except and to the extent provided in the bylaws of the Company.
 
SEVEN 
A. To the fullest extent permitted by the _____________ [state] General Corporation Law as the same exists or as may hereafter be amended, a director of the Company shall not be personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director.
 
B. The Company shall indemnify to the fullest extent permitted by law any person made or threatened to be made a party to an action or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that he, his testator or intestate is or was a director, officer or employee of the Company or any predecessor of the Company or serves or served any other enterprise as a director, officer or employee at the request of the Company or any predecessor to the Company.
 
C. Neither any amendment nor repeal of this Article SEVEN nor the adoption of any provision of this Companys Certificate of Incorporation inconsistent with this Article SEVEN, shall eliminate or reduce the effect of this Article SEVEN in respect of any matter occurring, or any action or proceeding accruing or arising or that, but for this Article SEVEN, would accrue or arise, prior to such amendment, repeal or adoption of an inconsistent provision.
 
D. Thereafter, pursuant to a resolution of the Board of Directors, this Amended and Restated Certificate of Incorporation was duly approved by the holders of the necessary number of shares of the Companys voting securities in accordance with the provisions of ____________________________________________________________________ [citation of state statutes].
 
 
* * *
 
IN WITNESS WHEREOF, the Company has caused this certificate to be signed by its duly authorized officer this _____________________________ [date].
 
_______________
[Name] 
 
[Chief Executive Officer]
 
 
 
 
 
 
 

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