CERTIFICATE OF INCORPORATION
OF
ELECTRONIC IDENTIFICATION, INC.
I, the undersigned, being the original incorporator named herein,
for the purpose of forming a corporation under the General
Corporation Law of the State of Nevada, to do business both
within and without the State of Nevada, do make and file these
Articles of Incorporation, hereby declaring and certifying that
the facts herein stated are true.
ARTICLE I
Name
The name of the Corporation is Electronic Identification,
Inc.
ARTICLE II
Duration
The Corporation is to have perpetual existence.
ARTICLE III
Registered Office and Agent
A. Resident Agent. The name and address of the registered
agent for service of process is Nevada Corporate Headquarters,
Inc., 5300 West Sahara Street (Suite 101), Las Vegas, Nevada,
89102. The name of its registered agent at such address is
Nevada Corporate Headquarters, Inc.
B. Registered Office. The address of its registered office is
5300 West Sahara Street (Suite 101), Las Vegas, Nevada, 89102.
C. Other Offices. The corporation may also maintain offices
for the transaction of any business at such other places within
or without the State of Nevada as it may from time to time
determine. Corporate business of every kind and nature may be
conducted, and meetings of directors and stockholders held
outside the State of Nevada have the same effect as if in the
State of Nevada.
ARTICLE IV
Purposes
The purpose for which the Corporation is organized is to
transact all lawful business, within or without the State of
Nevada, for which corporations may be incorporated pursuant to
the General Corporations Laws of the State of Nevada. The
Corporation shall have all the powers of a corporation organized
under the General Corporation Law of the State of Nevada.
ARTICLE V
Capital Stock
The aggregate number of shares of all classes of capital
stock which the Corporation has authority to issue is 75,000,000
of which 70,000,000 are to be shares of common stock, $.001 par
value per share, and 5,000,000 are to be shares of serial
preferred stock, $.001 par value per share. Shares of capital
stock may be issued by the Corporation from time to time as
approved by the board of directors of the Corporation without the
approval of the stockholders except as otherwise provided in this
Article V or the rules of a national securities exchange, if
applicable. The consideration for share issuance of shall be paid
to or received by the Corporation in full before their issuance
and shall not be less than the par value per share. The
consideration for the issuance of the shares shall be cash,
services rendered, personal property (tangible or intangible),
real property, leases of real property or any combination of the
foregoing. In the absence of actual fraud in the transaction, the
judgment of the board of directors as to the value of such
consideration shall be conclusive. Upon payment of such
consideration such shares shall be deemed to be fully paid and
nonassessable. In the case of a stock dividend, that part of the
surplus of the Corporation which is transferred to stated capital
upon the issuance of shares as a stock dividend shall be deemed
to be the consideration for their issuance.
A description of the different classes and series (if any)
of the Corporation's capital stock, and a statement of the
relative powers, designations, preferences and rights of the
shares of each class and series (if any) of capital stock, and
the qualifications, limitations or restrictions thereof, are as
follows:
A. Common Stock. Except as provided in this Certificate, the
holders of common stock shall exclusively posses all voting
power. Subject to the provisions of this Certificate, each
holder of shares of common stock shall be entitled to one
vote for each share held.
Whenever there shall have been paid, or declared and set
aside for payment, to the holders of the outstanding shares
of any class or series of stock having preference over the
common stock as to the payment of dividends, the full amount
of dividends and sinking fund or retirement fund or other
retirement payments, if any, to which such holders are
respectively entitled in preference to the common stock,
then dividends may be paid on the common stock, and on any
class or series of stock entitled to participate therewith
as to dividends, out of any assets legally available for the
payment of dividends, but only when and as declared by the
board of directors.
In the event of any liquidation, dissolution or winding up
of the Corporation, after there shall have been paid, or
declared and set aside for payment, to the holders of the
outstanding shares of any class having preference over the
common stock in any such event, the full preferential
amounts to which they are respectively entitled, the holders
of the common stock and of any class or series of stock
entitled to participate therewith, in whole or in part, as
to distribution of assets shall be entitled, after payment
or provision for payment of all debts and liabilities of the
Corporation, to receive the remaining assets of the
Corporation available for distribution, in cash or in kind.
Each share of common stock shall have the same relative
powers, preferences and rights as, and shall be identical in
all respects with, all the other shares of common stock of
the Corporation.
B. Serial Preferred Stock. Except as provided in this
Certificate, the board of directors is authorized, by
resolution or resolutions from time to time adopted, to
provide for the issuance of serial preferred stock in series
and to fix and state the powers, designations, preferences
and relative, participating, optional or other special
rights of the shares of each such series, and the
qualifications, limitation or restrictions thereof,
including, but not limited to determination of any of the
following:
(1) the distinctive serial designation and the number of
shares constituting such series;
(2) the rights in respect of dividends, if any, to be paid
on the shares of such series, whether dividends shall
be cumulative and, if so, from which date or dates, the
payment or date or dates for dividends, and the
participating or other special rights, if any, with
respect to dividends;
(3) the voting powers, full or limited, if any, of the
shares of such series;
(4) whether the shares of such series shall be redeemable
and, if so, the price or prices at which, and the terms
and conditions upon which such shares may be redeemed;
(5) the amount or amounts payable upon the shares of such
series in the event of voluntary or involuntary
liquidation, dissolution or winding up of the
Corporation;
(6) whether the shares of such series shall be entitled to
the benefits of a sinking or retirement fund to be
applied to the purchase or redemption of such shares,
and, if so entitled, the amount of such fund and the
manner of its application, including the price or
prices at which such shares may be redeemed or
purchased through the application of such funds;
(7) whether the shares of such series shall be convertible
into, or exchangeable for, shares of any other class or
classes or any other series of the same or any other
class or classes of stock of the Corporation and, if so
convertible or exchangeable, the conversion price or
prices, or the rate or rates of exchange, and the
adjustments thereof, if any, at which such conversion
or exchange may be made, and any other terms and
conditions of such conversion or exchange;
(8) the subscription or purchase price and form of
consideration for which the shares of such series shall
be issued; and
(9) whether the shares of such series which are redeemed or
converted shall have the status of authorized but
unissued shares of serial preferred stock and whether
such shares may be reissued as shares of the same or
any other series of serial preferred stock.
Each share of each series of serial preferred stock shall
have the same relative powers, preferences and rights as,
and shall be identical in all respects with, all the other
shares of the Corporation of the same series, except the
times from which dividends on shares which may be issued
from time to time of any such series may begin to accrue.
ARTICLE VI
Preemptive Rights
No holder of any of the shares of any class or series of
stock or of options, warrants or other rights to purchase shares
of any class or series of stock or of other securities of the
Corporation shall have any preemptive right to purchase or
subscribe for any unissued stock of any class or series, or any
unissued bonds, certificates of indebtedness, debentures or other
securities convertible into or exchangeable for stock or carrying
any right to purchase stock may be issued pursuant to resolution
of the board of directors to such persons, firms, corporations or
associations, whether or not holders thereof, and upon such terms
as may be deemed advisable by the board of directors in the
exercise of its sole discretion.
ARTICLE VII
Repurchase of Shares
The Corporation may from time to time, pursuant to
authorization by the board of directors and without action by the
stockholders, purchase or otherwise acquire shares of any class,
bonds, debentures, notes, scrip, warrants, obligations, evidences
or indebtedness, or other securities of the Corporation in such
manner, upon such terms, and in such amounts as the board of
directors shall determine; subject, however, to such limitations
or restrictions, if any, as are contained in the express terms of
any class of shares of the Corporation outstanding at the time of
the purchase or acquisition in question or as are imposed by law.
ARTICLE VIII
Meetings of Stockholders; Cumulative Voting
A. No action that is required or permitted to be taken by the
stockholders of the Corporation at any annual or special
meeting of stockholders may be effected by written consent
of stockholders in lieu of a meeting of stockholders, unless
the action to be effected by written consent of stockholders
and the taking of such action by such written consent have
expressly been approved in advance by the board of
directors.
B. Special meetings of the stockholders of the Corporation for
any purpose or purposes may be called at any time by the
board of directors, or by a committee of the board of
directors which as been duly designated by the board of
directors and whose powers and authorities, as provided in a
resolution of the board of directors or in the bylaws of the
Corporation, include the power and authority to call such
meetings but such special meetings may not be called by
another person or persons.
C. There shall be no cumulative voting by stockholders of any
class or series in the election of directors of the
Corporation.
D. Meetings of stockholders may be held at such place as the
bylaws may provide.
ARTICLE IX
Notice for Nominations and Proposals
A. Nominations for the election of directors and proposals for
any new business to be taken up at any annual or special
meeting of stockholders may be made by the board of
directors or by any stockholder of the Corporation entitled
to vote generally in the election of directors. In order for
a stockholder of the Corporation to make any nominations
and/or proposals at an annual meeting or such proposals at a
special meeting, he or she shall give notice thereof in
writing, delivered or mailed by first class United States
mail, postage prepaid, to the Secretary of the Corporation
of not less than thirty days nor more than sixty days prior
to any such meeting; provided, however, that if less than
forty days' notice of the meeting is given to stockholders,
such written notice shall be delivered or mailed, as
prescribed, to the Secretary of the Corporation not later
than the close of the tenth day following the day on which
notice of the meeting was mailed to stockholders. Each such
notice given by a stockholder with respect to nominations
for the election of directors shall set forth (1) the name,
age, business address and, if known, residence address of
each nominee proposed in such notice, (2) the principal
occupation or employment of each such nominee, and (3) the
number of shares of stock of the Corporation which are
beneficially owned by each such nominee. In addition, the
stockholder making such nomination shall promptly provide
any other information reasonably requested by the
Corporation.
B. Each such notice given by a stockholder to the Secretary
with respect to business proposals to bring before a meeting
shall set forth in writing as to each matter: (1) a brief
description of the business desired to be brought before the
meeting and the reasons for conducting such business at the
meeting; (2) the name and address, as they appear on the
Corporation's books, of the stockholder proposing such
business; (3) the class and number of shares of the
Corporation which are beneficially owned by the stockholder;
and (4) any material interest of the stockholder in such
business. Notwithstanding anything in this Certificate to
the contrary, no business shall be conducted at the meeting
except in accordance with the procedures set forth in this
Article.
C. The Chairman of the annual or special meeting of
stockholders may, if the facts warrant, determine and
declare to such meeting that a nomination or proposal was
not made in accordance with the foregoing procedure, and, if
he should so determine, he shall so declare to the meeting
and the defective nomination or proposal shall be
disregarded and laid over for action at the next succeeding
adjourned, special or annual meeting of the stockholders
taking place thirty days or more thereafter. This provision
shall not require the holding of any adjourned or special
meeting of stockholders for the purpose of considering such
defective nomination or proposal.
ARTICLE X
Directors
A. Number; Vacancies. The number of directors of the
Corporation shall be such number, not less than three nor
more than 15 (exclusive of directors, if any, to be elected
by holders of preferred stock of the Corporation), as shall
be provided from time to time in a resolution adopted by the
board of directors, provided that no decrease in the number
of directors shall have the effect of shortening the term of
any incumbent director, and provided further that no action
shall be taken to decrease or increase the number of
directors from time to time unless at least two-thirds of
the directors then in office shall concur in said action.
Exclusive of directors, if any, elected by holders of
preferred stock, vacancies in the board of directors,
however caused, and newly created directorships shall be
filled by a vote of two-thirds of the directors then in
office, whether or not a quorum, and any director so chosen
shall hold office for a term expiring at the annual meeting
of stockholders at which the term of the class to which the
director has been chosen expires and when the director's
successor is elected and qualified.
B. Classified Board. Other than directors which may be elected
by the holders of preferred stock, the board of directors
shall be divided in to three classes of directors which
shall be designated Class I, Class II and Class III. The
members of each class shall be elected for a term of three
years and until their successors are elected and qualified.
Such classes shall be as nearly equal in number as the then
total number of directors constituting the entire board of
directors shall permit, exclusive of directors, if any,
elected by holders of preferred stock, with the terms of
office of all members of one class expiring each year.
Should the number of directors not be equally divisible by
three, the excess director or directors shall be assigned to
Classes I or II as follows: (1) if there shall be an excess
of one directorship over the number equally divisible by
three, such extra directorship shall be classified in Class
I; and (2) if there be an excess of two directorships over a
number equally divisible by three, one shall be classified
in Class I and the other in Class II. At the first annual
meeting of stockholders, directors of Class I shall be
elected to hold office for a term expiring at the third
succeeding annual meeting of stockholders, directors of
Class I shall be elected to hold office for a term expiring
at the third annual meeting of stockholders, directors of
Class III shall be elected to hold office for a term
expiring at the third succeeding annual meeting thereafter.
Thereafter, at each succeeding annual meeting, directors of
each class shall be elected for three year terms.
Notwithstanding the foregoing, the director whose term shall
expire at any annual meeting shall continue to serve until
such time as his successor shall have been duly elected and
shall have qualified unless his position on the board of
directors shall have been abolished by action taken to
reduce the size of the board of directors prior to said
meeting.
Should the number of directors of the Corporation be
reduced, the directorship(s) eliminated shall be allocated
among classes as appropriate so that the number of directors
in each class is as specified in the position(s) to be
abolished. Notwithstanding the foregoing, no decrease in the
number of directors shall have the effect of shortening the
term of any incumbent director. Should the number of
directors of the Corporation be increased, other than for
directors which may be elected by the holders of preferred
stock, the additional directorships shall be allocated among
classes as appropriate so that the number of directors in
each class is as specified in the immediately preceding
paragraph.
Whenever the holders of any one or more series of preferred
stock of the Corporation shall have the right, voting
separately as a class, to elect one or more directors of the
Corporation, the board of directors shall consist of said
directors so elected in addition to the number of directors
fixed as provided in this Article X. Notwithstanding the
foregoing, and except as otherwise may be required by law,
whenever the holders of any one or more series of preferred
stock of the Corporation, the terms of the director or
directors elected by such holders shall expire at the next
succeeding annual meeting of stockholders.
C. Initial Board of Directors. The initial board of directors
shall consist of one (1) member. The name and address of
the initial member of the board of directors is as follows:
<TABLE>
<S> <C>
Name Address
Terry Kirby 411-1200 West Pender
Street
Vancouver, British
Columbia
Canada V6E 2S9
</TABLE>
ARTICLE XI
Removal of Directors
Notwithstanding any other provision of this Certificate or
the bylaws, any director or the entire board of directors may be
removed, at any time, but only for cause and only by the
affirmative vote of the holders of at least 50% of the voting
power of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of
directors (considered for this purpose as one class) cast at a
meeting of the stockholders called for that purpose.
Notwithstanding the foregoing, whenever the holders of any one or
more series of preferred stock of the Corporation shall have the
right, voting separately as a class, to elect one or more
directors of the Corporation, the preceding provisions of this
Article XI shall not apply with respect to the director or
directors elected by such holders of preferred stock.
ARTICLE XII
Acquisition of Capital Stock
A. For the purpose of this Article:
(1) The term "Act" shall mean the Securities Exchange Act
of 1934, as amended, and any successor statute.
(2) The term "acting in concert" shall mean (i) knowing
participation in a joint activity or conscious parallel
action towards a common goal whether or not pursuant to
an express agreement, and (ii) a combination or pooling
of voting or other interest in the Corporation's
outstanding shares of capitol stock for a common
purpose, pursuant to any contract, understanding,
relationship, agreement or other arrangement, whether
written or otherwise.
(3) The term "acquire," "acquisition" or "acquiring" with
respect to the acquisition of any security of the
Corporation shall refer to the acquisition of such
security by any means whatsoever, including without
limitation, an acquisition of such security by gift, by
operation of law, by will or by intestacy, whether
voluntarily or involuntarily.
(4) The term "Code" means the Internal Revenue Code of
1986, as amended, and any successor statute.
(5) The term "Common Stock" means all Common Stock of the
Corporation and any other securities issued by the
Corporation (other than the Warrants) which are treated
as stock for purposes of Section 382 of the Code.
(6) The term "Fair Market Value" of the Common Stock shall
mean the average of the daily closing prices of the
Common Stock for 15 consecutive trading days commencing
20 trading days before the date of such computation The
closing price is the last reported sale price on the
principal securities exchange on which the Common Stock
is listed or, if the Common Stock is not listed on any
national securities exchange, the NASDAQ National
Marked System, or, if the Common Stock is not
designated for trading on the NASDAQ National Market
System, the average of the closing bid and asked prices
as reported on NASDAQ or, if not so reported, as
furnished by the National Quotation Bureau
Incorporated. In the absence of such a quotation, the
Corporation shall determine the current market rice on
a reasonable and appropriate basis of the average of
the daily closing prices for 15 consecutive trading
days commencing 20 trading days before the date of such
computation.
(7) The term "own," "owing," "ownership" or "owning" refer
to the ownership of securities within the meaning of
Section 382 of the Code after taking into account the
attribution rules of Section 382(l)(3) of the Code and
the regulations promulgated hereunder (except insofar
as such attribution would be inconsistent with
provisions of this Article XII relating to Warrants).
(8) The term "Person" shall mean any individual, firm,
corporation, partnership, joint venture or other entity
and shall include any group composed of such person and
any other person with whom such person or any Affiliate
or Associate (as those terms are defined in Rule 12b-2
of the General Rules and Regulations under the Act) of
such person has any agreement, arrangement or
understanding, directly or indirectly, for the purposes
of acquiring, holding, voting or disposing of Common
Stock or Warrants, and any other person who is a member
of such group.
(9) The term "Transfer Agent" shall mean the transfer agent
with respect to the Common Stock nominated and
appointed by the Board of Directors from time to time.
(10) The term "Warrant" shall mean any securities issued or
assumed by the Corporation, or any securities issuable
by the Corporation in respect to issued securities
which are convertible into, or which include the right
to acquire, shares of Common Stock, whether or not the
right to make such conversion or acquisition is subject
to any contingencies, including, without limitation,
warrants, options, calls, contracts to acquire
securities, convertible debt instruments or any other
interests treated as an option pursuant to Section
382(l)(3) of the Code.
(11) The term "Warrant Agent" shall mean any warrant agent for
any Warrants nominated and appointed by the Board of Directors
from time to time.
B. (1) If, at any time during the ten years from the effective
date of this Certificate, any Person shall acquire the
beneficial ownership (as determined pursuant to Rules 13d-3
and 13d-5 under the Act) of more than 20% of any class of
Common Stock, then the record holders of Common stock
beneficially owned by such acquiring Person shall have only
the voting rights set forth in this paragraph B on any
matter requiring their vote or consent. With respect to each
vote in excess of 20% of the voting power of the outstanding
shares of Common Stock which such record holders would
otherwise be entitled to cast without giving effect to this
paragraph B, the record holders in the aggregate shall be
entitled to cast only one-hundredth of a vote. A Person who
is a record owner of shares of Common Stock that are
beneficially owned simultaneously by more than one person
shall have, with respect to such shares, the right to cast
the least number of votes that such person would be entitled
to cast under this paragraph B by virtue of such shares
being so beneficially owned by any of such acquiring
Persons. The effect of the reduction in voting power
required by this paragraph B shall be given effect in
determination the presence of a quorum for purposes of
convening a meeting of the stockholders of the Corporation.
(2) The limitation on voting rights prescribed by this
paragraph B shall terminate and be of no force and effect as of
the earliest to occur of:
(i) the date that any person becomes the beneficial owner
of shares of stock representing at least 50% of the total number
of votes entitled to be cast in respect of all outstanding shares
of stock, before giving effect to the reduction in votes
prescribed by this paragraph B; or
(ii) the date (the "Reference Date") one day prior to the
date on which, as a result of such limitation of voting rights,
the Common Stock will be delisted from (including by ceasing to
be temporarily or provisionally authorized for listing with) a
national stock exchange ("stock exchange") or be no longer
authorized for inclusion (including by ceasing to be
provisionally or temporarily authorized for inclusion) on the
National Association of Securities Dealers, Inc. Automated
Quotation System ("Nasdaq:); provided, however, that (a) such
termination shall not occur until the earlier of (x) the 90th day
after the Reference Date or (y) the first day on or after a
Reference Date that there is not pending a proceeding under the
rules of the NYSE, the AMEX or Nasdaq or any other administrative
or judicial proceeding challenging such delisting or removal of
authorization of the Common Stock, an application for listing of
the Common stock with the NYSE or the AMEX or for authorization
for the Common Stock to be including on Nasdaq, or an appeal with
respect to any such application, and (b) such termination shall
not occur by virtue of such delisting or lack of authorization if
on or prior to the earlier of the 90th day after the Reference
Date or the day on which no proceeding, application or appeal of
the type described in (y) above is pending, the Common Stock is
approved for listing or continued listing on the NYSE or the AMEX
or authorized for inclusion or continued inclusion on Nasdaq
(including any such approval or authorization which is temporary
or provisional). Nothing contained herein shall be construed so
as to prevent the Common Stock from continuing to be listed with
the NYSE or AMEX or continuing to be authorized for inclusion on
Nasdaq in the event that the NYSE, AMEX or Nasdaq, as the case
may be, adopts a rule or is governed by an order, decree, ruling
or regulation of the Securities and Exchange Commission which
provides in whole or in part that companies having common stock
with differential voting rights listed on the NYSE or the Amex or
authorized for inclusion on Nasdaq may continue to be so listed
or included.
C. The restrictions contained in this Article XII shall
not apply to (1) any underwriter or member of an underwriting or
selling group involving a public sale or resale of securities of
the Corporation or a subsidiary thereof; provided, however, that
upon completion of the sale or resale of such securities, no such
underwriter or member of such selling group is a beneficial owner
of more than 4.9% of any class of equity security of the
Corporation, (2) any revocable proxy granted pursuant to a proxy
solicitation in compliance with section 14 of the Act by a
stockholder of the Corporation or (3) any employee benefit plans
of the Corporation. In addition, the Continuing Directors of the
Corporation, the officers and employees of the Corporation and
its subsidiaries, the directors of subsidiaries of the
Corporation, the employee benefit plans of the Corporation and
its subsidiaries, entities organized or established by the
Corporation or any subsidiary thereof pursuant to the terms of
such plans and trustees and fiduciaries with respect to such
plans acting in such capacity shall not be deemed to be a group
with respect to their beneficial ownership of voting stock of the
Corporation solely by virtue of their being directors, officers
or employees of the Corporation or a subsidiary thereof or by
virtue of the Continuing Directors of the Corporation, the
officers and employees of the Corporation and its subsidiaries
and the directors of subsidiaries of the Corporation being
fiduciaries or beneficiaries of an employee benefit plan of the
Corporation or a subsidiary of the Corporation. Notwithstanding
the foregoing, no director, officer or employee of the
Corporation or any of its subsidiaries or group of any of them
shall be exempt from the provisions of this Article XII should
any such person or group become a beneficial owner of more than
20% of any class of equity security of the Corporation.
D. A majority of the Continuing Directors, as defined in
Article XIII, shall have the power to construe and apply the
provisions of paragraphs B, C and D of this Article XII and
to make all determinations necessary or desirable to
implement such provisions, including but not limited to
matters with respect to (1) the number of shares
beneficially owned by any person, (2) whether a person has
an agreement, arrangement or understanding with another as
to the matters referred to in the definition of beneficial
ownership, (3) the application of any other definition or
operative provision of this Article XII to the given facts
or (4) any other matter relating to the applicability or
effect of paragraphs B, C and D of this Article XII. Any
constructions, applications, or determinations made by the
Continuing Directors pursuant to paragraphs B, C and D of
this Article XII in good faith and on the basis of such
information and assistance as was then reasonably available
for such purpose shall be conclusive and binding upon the
Corporation and its stockholders.
E. All certificates evidencing ownership of Common Stock or
ownership of Warrants of the Corporation shall bear a
conspicuous legend in compliance with the General
Corporation Law of Delaware describing the restrictions on
transfers set forth in this Article XII.
F. If any provision of this Article XII or any application of
any such provision is determined to be invalid by any
federal or state court having jurisdiction over the issues,
the validity of the remaining provisions shall not be
affected and other applications of such provision shall be
affected only to the extent necessary to comply with the
determination of such court.
ARTICLE XIII
Approval of Certain Business Combinations
The stockholder vote required to approve Business
Combinations (as hereinafter defined) shall be as set forth in
this section.
A. (1) Except as otherwise expressly provided in this Article
XIII, and in addition to any other vote required by law, the
affirmative vote required by law, the affirmative vote of
the holders of (i) at least 50% of the voting power of the
outstanding shares entitled to vote thereon (and, if any
class or series of shares is entitled to vote thereon
separately the affirmative vote of the holders of at least
50% of the outstanding shares of each such class or series),
and (ii) at least a majority of the outstanding shares
entitled to vote thereon, not including shares deemed
beneficially owned by a Related Person (as hereinafter
defined), shall be required in order to authorize any of the
following:
(a) any merger or consolidation of the Corporation or
a subsidiary of the Corporation with or into a
Related person (as hereinafter defined);
(b) any sale, lease, exchange, transfer or other
disposition, including without limitation, a
mortgage or pledge, of all or any Substantial Part
(as hereinafter defined) of the assets of the
Corporation (including without limitation any
voting securities of a subsidiary) or of a
subsidiary, to a Related Person;
(c) any merger or consolidation of a Related Person
with or into the Corporation or a subsidiary of
the Corporation;
(d) any sale, lease, exchange, transfer or other
disposition of all or any Substantial Part of the
assets of a Related Person to the Corporation or a
subsidiary of the Corporation;
(e) the issuance of any securities of the Corporation
or a subsidiary of the Corporation to a Related
Person other than on a pro rata basis to all
holders of capital stock of the Corporation of the
same class or classes held by the Related person,
pursuant to a stock split, stock dividend or
distribution or warrants or rights, and other than
in connection with the exercise or conversion of
securities exercisable for or convertible into
securities of the Corporation or any of its
subsidiaries which securities have been
distributed pro rata to all holders of capital
stock of the Corporation;
(f) the acquisition by the Corporation or a subsidiary
of the Corporation of any securities of a Related
Person;
(g) any reclassification of the common stock of the
Corporation, or any recapitalization involving the
common stock of the Corporation or any similar
transaction (whether or not with or into or
otherwise involving a Related Person) that has the
effect directly or indirectly, of increasing by
more than 1% the proportionate share of the
outstanding shares of any class of equity or
convertible securities of the Corporation or any
subsidiary that are directly or indirectly owned
by any Related Person; and
(h) any agreement, contract or other arrangement
providing for any of the transactions described in
this Article XIII.
(2) Such affirmative vote shall be required notwithstanding
any other provision of this Certificate, any provision
of law, or any agreement with any regulatory agency or
national securities exchange which might otherwise
permit a lesser vote or no vote; provided, however,
that in no instance shall the provisions of this
Article XIII require the vote of greater than 85% of
the voting power of the outstanding shares entitled to
vote thereon for the approval of a Business
Combination.
(3) The term "Business Combination" as used in this Article
XIII shall mean any transaction which is referred to in
any one or more of subparagraphs A(1)(a) through (h)
above.
B. The provisions of paragraph A shall not be applicable to any
particular Business Combination, and such Business
Combination shall require only such affirmative vote as is
required by any other provision of this Certificate, any
provision of law, or any agreement with any regulatory
agency or national securities exchange, if the Business
Combination shall have been approved in advance by a two-
thirds vote of the Continuing Directors (as hereinafter
defined; provided, however, that such approval shall only be
effective if obtained at a meeting at which a continuing
Director Quorum (as hereinafter defined) is present.
C. For the purposes of this Article XIII the following
definitions apply:
(1) The term "Related Person" shall mean and include (i)
any individual, corporation, partnership or other
person or entity which together with its "affiliates"
or "associates" (as those terms are defined in the Act)
"beneficially owns" (as that there is defined in the
Act) in the aggregate 10% or more of the outstanding
shares of the common stock of the Corporation; and (ii)
any "affiliate" or "associate" (as those terms are
defined in the Act) of any such individual,
Corporation, partnership or other person or entity;
provided, however, that the term "Related Person" shall
not include the Corporation, any subsidiary of the
Corporation, any employee benefit plan, employee stock
plan of the Corporation or of any subsidiary of the
Corporation, or any trust established by the
Corporation in connection with the foregoing, or any
person or entity organized, appointed, established or
holding shares of capital stock of the Corporation for
or pursuant to the terms of any such plan, nor shall
such term encompass shares of capital stock of the
Corporation held by any of the foregoing (whether or
not held in a fiduciary capacity or otherwise). Without
limitation, any shares of the common stock of the
Corporation which any Related Person has the right to
acquire pursuant to any agreement, or upon exercise or
conversion rights, warrants or options, or otherwise,
shall be deemed "beneficially owned" by such Related
Person.
(2) The term "Substantial Part" shall mean more than 25% of
the total assets of the entity at issue, as of the end
of its most recent fiscal year ending prior to the time
the determination is made.
(3) The term "Continuing Director" shall mean any member of
the board of directors who is unaffiliated with and who
is not the Related Person and was a member of the board
prior to the time that the Related Person became a
Related Person, and any successor of a Continuing
Director who is unaffiliated with and who is not the
Related Person and is recommended to succeed a
Continuing Director by a majority of Continuing
Directors then on the board.
(4) The term "Continuing Director Quorum" shall mean two-
thirds of the Continuing Directors capable of
exercising the powers conferred on them.
ARTICLE XIV
Evaluation of Business Combinations
In connection with the exercise of its judgment in
determining what is in the best interests of the Corporation and
of the stockholders, when evaluating a Business Combination (as
defined in Article XIII) or a tender or exchange offer, the board
of directors shall, in addition to considering the adequacy of
the amount to be paid in connection with any such transaction,
consider all of the following factors and any other factors which
it deems relevant; (A) the social and economic effects of the
transaction on the Corporation and its subsidiaries, employees
and customers, creditors and other elements of the communities in
which the Corporation and its subsidiaries operate or are
located; (B) the business and financial condition and earnings
prospects of the acquiring person or entity, including, but not
limited to, debt service and other existing financial
obligations, financial obligations to be incurred in connection
with the acquisition and other likely financial obligations of
the acquiring person or entity and the possible effect of such
conditions upon the Corporation and obligations of the acquiring
person or entity and the possible effect of such conditions upon
the Corporation and its subsidiaries and the other elements of
the communities in which the Corporation and its subsidiaries
operate or are located; and (C) the competence, experience, and
integrity of the acquiring person or entity and its or their
management.
ARTICLE XV
Indemnification
A. Persons. The Corporation shall indemnify, to the extent
provided in paragraphs B, D or F:
(1) any person who is or was a director, officer, employee,
or agent of the Corporation; and
(2) any person who serves or served at the Corporation's
written request as a director, officer, employee,
agent, partner or trustee of another corporation,
partnership, joint venture, trust or other enterprise.
B. Extent -- Derivative Suits. In case of a threatened, pending
or completed action or suit by or in the right of the
Corporation against a person named in paragraph A by reason
of his holding a position named in paragraph A, the
Corporation shall indemnify him if he satisfies the standard
in paragraph C, for expenses (including attorneys' fees but
excluding amounts paid in settlement) actually and
reasonably incurred by him in connection with the defense or
settlement of the action or suit.
C. Standard -- Derivative Suits. In case of a threatened,
pending or completed action or suit by or in the right of
the Corporation, a person named in paragraph A shall be
indemnified only if:
(1) he is successful on the merits or otherwise; or
(2) he acted in good faith in the transaction which is the
subject of the suit or action, and in a manner he
reasonably believed to be in, or not opposed to, the
best interests of the Corporation, including, but not
limited to, the taking of any and all actions in
connection with the Corporation's response to any
tender offer or any offer or proposal of another party
to engage in a Business Combination (as defined in
Article XIII) not approved by the board of directors.
However, he shall not be indemnified in respect of any
claim, issue or matter as to which he has been adjudged
liable to the Corporation unless (and only to the
extent that) the court in which the suit was brought
shall determine, upon application, that despite the
adjudication but in view of all the circumstances, he
is fairly and reasonably entitled to indemnity for such
expenses as the court shall deemed proper.
D. Extent -- Nonderivative Suits. In case of a threatened,
pending or completed suit, action or proceeding (whether
civil, criminal, administrative or investigative), other
than a suit by or in the right of the Corporation, together
hereafter referred to as a "nonderivative suit," against a
person named in paragraph A by reason of his holding a
position named in paragraph A, the Corporation shall
indemnify him if he satisfies the standard in paragraph E,
for amounts actually and reasonably incurred by him in
connection with the defense or settlement of the
nonderivative suit, including, but not limited to (1)
expenses (including attorneys' fees), (2) amounts paid in
settlement, (3) judgments, and (4) fines.
E. Standard -- Nonderivative Suits. In case of a nonderivative
suit, a person named in paragraph A shall be indemnified
only if:
(1) he is successful on the merits or otherwise; or
(2) he acted in good faith in the transaction which is the
subject of the nonderivative suit and in a manner he
reasonably believed to be in, or not opposed to, the
best interests of the Corporation, including, but not
limited to, the taking of any and all actions in
connection with the Corporation's response to any
tender offer or any offer or proposal of another party
to engage in a Business Combination (as defined in
Article XIII) not approved by the board of directors
and, with respect to any criminal action or proceeding,
he had no reasonable cause to believe his conduct was
unlawful. The termination of a nonderivative suit by
judgment, order, settlement, conviction, or upon a plea
of nolo contendere or its equivalent shall not, in
itself, create a presumption that the person failed to
satisfy the standard of this paragraph E(2).
F. Determination That Standard Has Been Met. A determination
that the standard of paragraph C or E has been satisfied may
be made by a court; or, except as stated in paragraph C(2)
(second sentence), the determination may be made by:
(1) the board of directors by a majority vote of a quorum
consisting of directors of the Corporation who were not
parties to the action, suit or proceeding; or
(2) independent legal counsel (appointed by a majority of
the disinterested directors of the Corporation, whether
or not a quorum) in a written opinion; or
(3) the stockholders of the Corporation.
G. Proration. Anyone making a determination under paragraph F
may determine that a person has met the standard as to some
matters but not as to others, and may reasonably prorate amounts
to be indemnified.
H. Advance Payment. The Corporation may, but shall not be
obligated to, pay in advance any expenses (including attorneys'
fees) which may become subject to indemnification under
paragraphs A through G if:
(1) the board of directors authorizes the specific payment;
and
(2) the person receiving the payment undertakes in writing
to repay the same if it is ultimately determined that
he is not entitled to Indemnification by the
Corporation under paragraphs A through G.
I. Nonexclusive. The indemnification and advance payment of
expenses provided by paragraphs A through H shall not be
exclusive of any other rights to which a person may be
entitled by law, bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise.
J. Continuation. The indemnification provided by this Article
XV shall be deemed to be a contract between the Corporation
and the persons entitled to indemnification thereunder, and
any repeal or modification of this Article XV shall not
affect any rights or obligations then existing with respect
to any state of facts then or theretofore existing or any
action, suit or proceeding theretofore or thereafter brought
based in whole or in part upon any such state of facts. The
indemnification and advance payment provided by paragraphs A
through H shall continue as to a person who has ceased to
hold a position named in paragraph A and shall inure to his
heirs, executors and administrators.
K. Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who holds or who has held
any position named in paragraph A, against any liability
incurred by him in any such position, or arising out of his
status as such, whether or not the Corporation would have
power to indemnify him against such liability under
paragraphs A through H.
L. Savings Clause. If this Article XV or any portion hereof
shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation shall nevertheless
indemnify each director, officer, employee, and agent of the
Corporation as to costs, charges, and expenses (including
attorneys' fees), judgments, fines, and amounts paid in
settlement with respect to any action, suit, or proceeding,
whether civil, criminal, administrative, or investigative,
including an action by or in the right of the Corporation to
the full extent permitted by any applicable portion of this
Article XV that shall not have been invalidated and to the
full extent permitted by applicable law.
ARTICLE XVI
Limitations on Directors' Liability
A director of the Corporation shall not be personally liable
to the Corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director, except: (A) for any
breach of the director's duty of loyalty to the Corporation or
its stockholders, (B) for acts or omissions that are not in good
faith or that involve intentional misconduct or a knowing
violation of Corporation Law of the State of Nevada. If the
General Corporation Law of the State of Nevada is amended after
the date of filing of this Certificate to further eliminate or
limit the personal liability of directors, then the liability of
a director of the Corporation shall be eliminated or limited to
the fullest extent permitted by the General Corporation Law of
the State of Nevada, as so amended.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any
right or protection of a director of the Corporation existing at
the time of such repeal or modification.
ARTICLE XVII
Amendment of Bylaws
In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized to
adopt, repeal, alter, amend and rescind the bylaws by a vote of
two-thirds of the board of directors. Notwithstanding any other
provision of this Certificate or the bylaws, and in addition to
any affirmative vote required by law (and notwithstanding the
fact that some lesser percentage may be specified by law), the
bylaws shall be adopted, repealed, altered, amended or rescinded
by the stockholders of the Corporation only by the vote of the
holders of not less than 50% of the voting power of the
outstanding shares of capital stock of the Corporation entitled
to vote generally in the election of directors (considered for
this purpose as one class) cast at a meeting of stockholders
called for that purpose or by proxy (provided that notice of such
proposed adoption, repeal, alteration, amendment or rescission is
included in the notice of such meeting or in such proxy) or, as
set forth above, by the board of directors.
ARTICLE XVIII
Amendment of Certificate of Incorporation
Subject to the provisions hereof, the Corporation reserves
the right to repeal, alter, amend or rescind any provision
contained in this Certificate in the manner now or hereafter
prescribed by law, and all rights conferred on stockholders
herein are granted subject to this reservation. Notwithstanding
the foregoing at any time and from time to time, the provisions
set forth in Articles VIII, IX, X, XI, XII, XIII, XIV, XV, XVI,
XVII and this Article XVIII may be repealed, altered, amended or
rescinded in any respect only if the same is approved by the
affirmative vote of the holders of not less than 50% of the
voting power of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of
directors (considered for this purpose as a single class) cast at
a meeting of the stockholders called for that purpose or by proxy
(provided that notice of such proposed adoption, repeal,
alteration, amendment or rescission is included in the notice of
such meeting or in such proxy).
ARTICLE XIX
The name and address of the incorporator is:
Terry Kirby
411-1200 West Pender Street
Vancouver, British Columbia
Canada V6E 2S9
I, THE UNDERSIGNED, being the incorporator, for the purpose
of forming a corporation pursuant to the General Corporation Law
of the State of Nevada, do make and file this Certificate of
Incorporation, hereby declaring and certifying that the facts
herein stated are true, and accordingly have hereunto set my hand
this 15th day of April, 1999.
/s/Terry Kirby
Terry Kirby
