<PAGE>
EXHIBIT 3.1
FORM OF
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
PROPEL, INC.
The name of the corporation is Propel, Inc. The original certificate
of incorporation of the corporation was filed with the Secretary of State of
the State of Delaware on February 24, 1999, and amended on September 17, 1999.
This Amended and Restated Certificate of Incorporation amends and, as
amended, restates in its entirety the corporation's certificate of
incorporation and has been duly proposed by resolutions adopted and declared
advisable by the Board of Directors of the Corporation, duly adopted by the
sole stockholder of the Corporation and duly executed and acknowledged by the
officers of the Corporation in accordance with Sections 103, 242 and 245 of the
General Corporation Law of the State of Delaware.
The text of the certificate of incorporation of the corporation is
hereby amended and restated to read in its entirety as follows:
ARTICLE I
NAME
The name of the corporation (hereinafter referred to as the
"CORPORATION") is Propel, Inc.
ARTICLE II
REGISTERED OFFICE AND AGENT
The address of the Corporation's registered office in the State of
Delaware is The Corporation Trust Center, 1209 Orange Street in the City of
Wilmington, County of New Castle. The name of the Corporation's registered
agent at such address is The Corporation Trust Company.
ARTICLE III
PURPOSE
The purpose of the Corporation shall be to engage in any lawful act or
activity for which corporations may be incorporated under the General
Corporation Law of the State of Delaware, as from time to time in effect (the
"DGCL").
ARTICLE IV
<PAGE>
CAPITAL STOCK
Section 1. AUTHORIZED STOCK. The Corporation shall be authorized to issue
five hundred, five million shares of capital stock, of which five hundred
million (500,000,000) shares shall be shares of Common Stock, $0.01 par value
per share ("COMMON STOCK"), and five million (5,000,000) shares shall be shares
of Preferred Stock, $___ par value per share ("PREFERRED STOCK").
Section 2. DESIGNATION OF PREFERRED STOCK TERMS. The Preferred Stock may
be issued from time to time in one or more series. The Board of Directors is
hereby authorized to provide for the issuance of shares of Preferred Stock in
series and, by filing a certificate pursuant to the DGCL (hereinafter referred
to as a "PREFERRED STOCK DESIGNATION"), to establish from time to time the
number of shares to be included in each such series, and to fix the
designation, powers, privileges, preferences and rights of the shares of each
such series and the qualifications, limitations and restrictions thereon. The
authority of the Board of Directors with respect to each series shall include,
but not be limited to, determination of the following:
(a) the designation of the series, which may be by distinguishing
number, letter or title;
(b) the number of shares of the series, which number the Board of
Directors may thereafter (except where otherwise provided in the Preferred
Stock Designation) increase or decrease (but not below the number of shares
thereof then outstanding) in the manner permitted by law;
(c) the rate of any dividends (or method of determining the
dividends) payable to the holders of the shares of such series, any conditions
upon which such dividends shall be paid and the date or dates or the method for
determining the date or dates upon which such dividends shall be payable;
(d) whether dividends, if any, shall be cumulative or noncumulative,
and, in the case of shares of any series having cumulative dividend rights, the
date or dates or method of determining the date or dates from which dividends
on the shares of such series shall cumulate;
(e) if the shares of such series may be redeemed by the Corporation,
the price or prices (or method of determining such price or prices) at which,
the form of payment of such price or prices (which may be cash, property or
rights, including securities of the Corporation or of another corporation or
other entity) for which, the period or periods within which and the other terms
and conditions upon which the shares of such series may be redeemed, in whole
or in part, at the option of the Corporation or at the option of the holder or
holders thereof or upon the happening of a specified event or events, if any,
including the obligation, if any, of the Corporation to purchase or redeem
shares of such series pursuant to a sinking fund or otherwise;
2
<PAGE>
(f) the amount payable out of the assets of the Corporation to the
holders of shares of the series in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the Corporation;
(g) provisions, if any, for the conversion or exchange of the shares
of such series, at any time or times, at the option of the holder or holders
thereof or at the option of the Corporation or upon the happening of a
specified event or events, into shares of any other class or classes or any
other series of the same class of capital stock of the Corporation or into any
other security of the Corporation, or into the stock or other securities of any
other corporation or other entity, and the price or prices or rate or rates of
conversion or exchange and any adjustments applicable thereto, and all other
terms and conditions upon which such conversion or exchange may be made;
(h) restrictions on the issuance of shares of the same series or of
any other class or series of capital stock of the Corporation, if any; and
(i) the voting rights and powers, if any, of the holders of shares
of the series.
Section 3. POWERS, PRIVILEGES AND RIGHTS PERTAINING TO THE COMMON STOCK.
The powers, privileges and rights pertaining to the Common Stock shall be
subject to the powers, privileges, preferences and rights pertaining to the
Preferred Stock and any and all series thereof. The holders of shares of Common
Stock shall be entitled to one vote for each such share upon all matters and
proposals presented to the stockholders on which the holders of Common Stock
are entitled to vote. Except as otherwise provided by law or by a Preferred
Stock Designation, the Common Stock shall have the exclusive right to vote for
the election of directors and on all other matters or proposals presented to
the stockholders; except that the holders of shares of Common Stock, as such,
shall not be entitled to vote on any amendment of the certificate of
incorporation of the Corporation (including any amendment of any provision of a
Preferred Stock Designation) that solely relates to the powers, privileges,
preferences or rights pertaining to one or more outstanding series of Preferred
Stock, or the number of shares of any such series, and does not affect the
number of authorized shares of Preferred Stock. A Preferred Stock Designation
may not grant to the holders of shares of Preferred Stock the right to vote on
any amendment of the certificate of incorporation that relates solely to the
powers, privileges and rights pertaining to the Common Stock, and may not
eliminate the voting rights of the holders of shares of the Common Stock.
Holders of shares of Preferred Stock (of any series) shall not be entitled to
receive notice of any meeting of stockholders at which they are not entitled to
vote, except as may be explicitly provided by any Preferred Stock Designation.
The number of authorized shares of Preferred Stock may be increased or
decreased (but not below the number of shares thereof then outstanding) by the
affirmative vote of the holders of a majority of the outstanding shares of
Common Stock, without a vote of the holders of the Preferred Stock, or of any
series thereof, unless a vote of any such holders is required pursuant to
another provision of the certificate of incorporation of the Corporation
(including any Preferred Stock Designation).
3
<PAGE>
ARTICLE V
BYLAWS
Bylaws for the Corporation may be adopted, consistent with law and the
provisions of the certificate of incorporation of the Corporation (including
any Preferred Stock Designation), and, once adopted, any Bylaw may be altered
or repealed: (i) by the affirmative vote of the holders of a majority of the
voting power of the capital stock issued and outstanding and entitled to vote
thereon; PROVIDED, HOWEVER, that any proposed alteration or repeal of, or the
adoption of any Bylaw inconsistent with, Section 2.2, 2.7 or 2.10 of Article II
or Section 3.1, 3.2 or 3.12 of Article III or or Article IX of the Bylaws in
effect on, and as the same may be amended from time to time in accordance
herewith after, the date of the effectiveness of this Amended and Restated
Certificate of Incorporation, shall require the affirmative vote of the holders
of at least 80% of the voting power of all shares of capital stock of the
Corporation entitled generally to vote on the election of directors of the
Corporation ("VOTING STOCK") then outstanding, voting together as a single
class; AND PROVIDED, FURTHER, HOWEVER, that in the case of any such stockholder
action at a special meeting of stockholders, notice of the proposed alteration,
repeal or adoption of the new Bylaw or Bylaws must be contained in the notice
of such special meeting, or (ii) by the affirmative vote of a majority of the
total number of directors which the Corporation would have if there were no
vacancies on the Board of Directors (the "WHOLE BOARD"); PROVIDED, HOWEVER,
that any amendment of the Bylaws by action of the Board of Directors shall
require the affirmative vote of a greater number of the directors if so
provided by the Bylaws (as from time to time amended and in effect from time to
time). Notwithstanding anything to the contrary elsewhere contained in the
certificate of incorporation of the Corporation, the affirmative vote of the
holders of at least 80% of the voting power of all Voting Stock then
outstanding, voting together as a single class, shall be required to alter,
amend or repeal, or to adopt any provision inconsistent with, this Article.
ARTICLE VI
STOCKHOLDER ACTION
Section 1. ACTION BY CONSENT IN LIEU OF A MEETING. Effective upon and
commencing as of the day following the day on which Motorola, Inc., a Delaware
corporation ("MOTOROLA"), and any company that is directly or indirectly
controlled by Motorola and of which at least a majority of the equity interests
therein are directly or indirectly beneficially owned by Motorola, shall first
cease to be the owner, in the aggregate, of at least a majority of the then
outstanding shares of Common Stock (the "TRIGGER DATE"), and except as
otherwise provided pursuant to provisions of the certificate of incorporation
of the Corporation (including any Preferred Stock Designation) fixing the
powers, privileges or rights of any class or series of stock other than the
Common Stock in respect of action by written consent of the holders of such
class or series of stock, any action required or permitted to be taken by the
stockholders of the Corporation must be effected at a duly called annual or
special meeting of such holders and may not be effected by any consent in
writing by such holders.
4
<PAGE>
Section 2. SPECIAL MEETINGS. Effective upon and commencing as of the
Trigger Date, except as otherwise required by law and subject to the rights of
the holders of any class or series of stock having a preference over the Common
Stock as to dividends or distributions upon liquidation, special meetings of
stockholders of the Corporation of any class or series for any purpose or
purposes may be called only by the Board of Directors pursuant to a resolution
stating the purpose or purposes thereof approved by a majority of the Whole
Board and, effective as of the Trigger Date, any power of stockholders to call
a special meeting is specifically denied. No business other than that stated in
the notice shall be transacted at any special meeting.
Section 3. STOCKHOLDER NOMINATION OF DIRECTOR CANDIDATES AND OTHER
STOCKHOLDER PROPOSALS. Advance notice of stockholder nominations for the
election of directors and of the proposal by stockholders of any other action
to be taken by the stockholders shall be given in such manner as shall be
provided in the Bylaws of the Corporation (as amended and in effect from time
to time).
Section 4. AMENDMENT OF THIS ARTICLE. Notwithstanding anything to the
contrary contained in the certificate of incorporation of the Corporation, the
affirmative vote of the holders of at least 80% of the voting power of all
shares of Voting Stock then outstanding, voting together as a single class,
shall be required to alter, amend or repeal, or to adopt any provision
inconsistent with, this Article.
ARTICLE VII
BOARD OF DIRECTORS
Section 1. POWERS OF THE BOARD OF DIRECTORS. The business and affairs of
the Corporation shall be managed by or under the direction of the Board of
Directors, which shall be constituted as provided in this Article and as
provided by law.
Section 2. NUMBER, ELECTION AND TERM OF OFFICE. Except in respect of the
election of additional directors as otherwise provided for by or pursuant to
the provisions of the certificate of incorporation of the Corporation
(including any Preferred Stock Designation) pertaining to any class or series
of stock having a preference over the Common Stock as to dividends or
distributions upon liquidation, the number of the directors of the Corporation
shall be fixed from time to time (and may be changed) exclusively pursuant to a
resolution adopted by a majority of the Whole Board, but shall not be less than
three; PROVIDED, HOWEVER, that (i) no reduction in the number of directors
shall end the term of office of any incumbent director prior to the date such
director's term of office would otherwise end, and (ii) the Bylaws may provide
that the vote of a greater number of the directors may be required for action
of the Board of Directors changing the size of the Board of Directors. The
directors, other than those who may be elected by the holders of any class or
series of stock having a preference over the Common Stock as to dividends or
distributions upon liquidation, shall be classified, by the Board of Directors
with respect to the time for which they severally hold office, into three
classes, as nearly equal in number as possible, one class to be originally
elected for a term expiring at the annual meeting of stockholders to be held in
2001, another class to be originally elected for a term expiring at the annual
meeting of stockholders to be held in 2002, and another
5
<PAGE>
class to be originally elected for a term expiring at the annual meeting of
stockholders to be held in 2003, with each director to hold office until his or
her successor is duly elected and qualified, such classification to be
effective upon the date shares of Common Stock are first publicly held. At each
succeeding annual meeting of stockholders, directors elected to succeed those
directors whose terms then expire shall be elected for a term of office to
expire at the third succeeding annual meeting of stockholders after their
election, with each director to hold office until his or her successor shall
have been duly elected and qualified.
Section 3. WRITTEN BALLOT NOT REQUIRED. Unless and except to the extent
that the Bylaws of the Corporation shall so require, the election of directors
of the Corporation need not be by written ballot.
Section 4. NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Except for the
rights of any class of Preferred Stock, or series thereof, to elect directors
and except as the stockholders shall otherwise be entitled to elect directors
as provided by law, newly created directorships resulting from any increase in
the number of directors constituting the Board of Directors and any vacancies
on the Board of Directors occurring for any reason shall be filled only by the
affirmative vote of a majority of the remaining directors then in office, even
though less than a quorum of the Board of Directors, and not by the
stockholders; PROVIDED, HOWEVER, that the Bylaws may provide that the vote of a
greater number of the directors may be required for action of the Board of
Directors to fill any vacancy on the Board of Directors and may provide that
any vacancy on the Board of Directors may be filled by vote of the
stockholders. Any director elected to fill a vacancy on the Board of Directors
shall hold office for the remainder of the full term of the class of directors
in which the new directorship was created or in which the vacancy occurred and
until such director's successor shall have been duly elected and qualified.
Section 5. REMOVAL. Subject to the rights of any class of Preferred Stock
or series thereof to elect and remove additional directors under specified
circumstances, (i) prior to the Trigger Date, any director may be removed from
office, with or without cause, by the affirmative vote of the holders of at
least a majority of the voting power of all Voting Stock then outstanding,
voting together as a single class and, (ii) on and after the Trigger Date, any
director may be removed from office only for cause by the affirmative vote of
the holders of at least a majority of the voting power of all Voting Stock then
outstanding, voting together as a single class.
Section 6. AMENDMENT OF THIS ARTICLE. Notwithstanding anything to the
contrary elsewhere contained in the certificate of incorporation of the
Corporation, the affirmative vote of the holders of at least 80% of the voting
power of all shares of Voting Stock then outstanding, voting together as a
single class, shall be required to alter, amend or repeal, or to adopt any
provision inconsistent with, this Article.
6
<PAGE>
ARTICLE VIII
LIMITATIONS ON LIABILITY OF AND INDEMNIFICATION
OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS
Section 1. LIMITED LIABILITY OF DIRECTORS. A director of the Corporation
shall not be personally liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director, except for any
liability imposed by law (as in effect from time to time) (i) for any breach of
the director's duty of loyalty to the Corporation or its stockholders, (ii) for
any act or omission not in good faith or which involved intentional misconduct
or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for
any transaction from which the director derived an improper personal benefit.
Neither the amendment nor the repeal of this Section 1 of this Article shall
eliminate or reduce the effect thereof in respect of any matter occurring, or
any cause of action, suit or claim that, but for this Section 1 of this Article
would accrue or arise, prior to such amendment or repeal.
Section 2. INDEMNIFICATION.
(a) INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS.
Each person who was or is made a party or is threatened to be made a party to
or is involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative in nature, including any appeal (hereinafter a
"PROCEEDING"), by reason of the fact that such person (or a person of whom such
person is the legal representative) is or was a director, officer, employee or
agent of the Corporation or, while a director, officer, employee or agent of
the Corporation, is or was serving at the request of the Corporation as a
director, officer, trustee, partner, member, employee, other fiduciary or agent
of another corporation or of a partnership, joint venture, limited liability
company, trust or other enterprise, including service with respect to employee
benefit plans or public service or charitable organizations, whether the basis
of such claim or proceeding is alleged actions or omissions in any such
capacity or in any other capacity while serving as a director, officer,
trustee, partner, member, employee, other fiduciary or agent thereof, may be
indemnified and held harmless by the Corporation to the fullest extent
permitted by the DGCL, against all expense and liability (including without
limitation, attorneys' fees and disbursements, court costs, damages, fines,
amounts paid or to be paid in settlement, and excise taxes or penalties)
reasonably incurred or suffered by such person in connection therewith and such
indemnification may continue as to a person who has ceased to be a director,
officer, employee or agent of the Corporation and may inure to the benefit of
such person's heirs, executors and administrators. The Corporation, by
provisions in its Bylaws or by agreement, may accord to any current or former
director, officer, employee or agent of the Corporation the right to, or
regulate the manner of providing to any current or former director, officer,
employee or agent of the Corporation, indemnification to the fullest extent
permitted by the DGCL.
(b) ADVANCE OF EXPENSES. The Corporation to the fullest extent
permitted by the DGCL may advance to any person who is or was a director,
officer, employee or agent of the Corporation (or to the legal representative
thereof) any and all expenses (including, without
7
<PAGE>
limitation, attorneys fees and disbursements and court costs) reasonably
incurred by such person in respect of any proceeding to which such person (or a
person of whom such person is a legal representative) is made a party or
threatened to be made a party by reason of the fact that such person is or was
a director, officer, employee or agent of the Corporation or, while a director,
officer, employee or agent of the Corporation, is or was serving at the request
of the Corporation as a director, officer, trustee, partner, member, employee,
other fiduciary or agent of another corporation or a partnership, joint
venture, limited liability company, trust or other enterprise, including
service with respect to employee benefit plans or public service or charitable
organizations; PROVIDED, HOWEVER, that, to the extent the DGCL requires, the
payment of such expenses in advance of the final disposition of the proceeding
shall be made only upon delivery to the Corporation of an undertaking, by or on
behalf of such person, to repay all amounts so advanced if it shall ultimately
be determined that such person is not entitled to be indemnified against such
expense under this Section 2 or otherwise. The Corporation by provisions in its
Bylaws or by agreement may accord any such person the right to, or regulate the
manner of providing to any such person, such advancement of expenses to the
fullest extent permitted by the DGCL.
(c) NON-EXCLUSIVITY OF RIGHTS. Any right to indemnification and
advancement of expenses conferred as permitted by this Section 2 shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute (including the DGCL), any other provision of the certificate
of incorporation of the Corporation, any agreement, any vote of stockholders or
the Board of Directors or otherwise.
Section 3. INSURANCE. The Corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent of the
Corporation or of another corporation or a partnership, joint venture, limited
liability company, trust or other enterprise against any expense, liability or
loss, whether or not the Corporation would have the power to indemnify such
person against such expense, liability or loss under the DGCL.
Section 4. SEVERABILITY. If any provision or provisions of this Article
shall be held to be invalid, illegal or unenforceable as applied to any
circumstance for any reason whatsoever: (a) the validity, legality and
enforceability of such provisions in any other circumstance and of the
remaining provisions of this Article (including, without limitation, each
portion of any paragraph of this Article containing any such provision held to
be invalid, illegal or unenforceable that is not itself held to be invalid,
illegal or unenforceable) shall not in any way be affected or impaired thereby
and (b) to the fullest extent possible, the provisions of this Article
(including, without limitation, each such portion of any paragraph of this
Article containing any such provision held to be invalid, illegal or
unenforceable) shall be construed so as to permit the Corporation to protect
its directors, officers, employees and agents from personal liability in
respect of their good faith service to or for the benefit of the Corporation to
the fullest extent permitted by law.
ARTICLE IX
CERTAIN BUSINESS COMBINATIONS
8
<PAGE>
Section 1. VOTE REQUIRED FOR CERTAIN BUSINESS COMBINATIONS. In addition
to any affirmative vote required by law or the certificate of incorporation or
the Bylaws of the Corporation, and except as otherwise expressly provided in
Section 2 of this Article, after such time as Motorola and any company
controlling, controlled by or under common control with Motorola ceases to be
the owner, in the aggregate, of Voting Stock representing fifty percent (50%)
or more of the votes entitled to be cast by the holders of all the then
outstanding shares of Voting Stock, a Business Combination (as hereinafter
defined) involving as a party, or proposed by or on behalf of, an Interested
Stockholder (as hereinafter defined) or an Affiliate or Associate (as
hereinafter defined) of an Interested Stockholder or a person who upon
consummation of such Business Combination would become an Affiliate or
Associate of an Interested Stockholder shall, except as otherwise prohibited by
applicable law, require the affirmative vote of not less than 66-2/3% of the
votes entitled to be cast by the holders of all the then outstanding shares of
Voting Stock, voting together as a single class, excluding Voting Stock
Beneficially Owned (as hereinafter defined) by any Interested Stockholder. Such
affirmative vote shall be required notwithstanding the fact that no vote may be
required, or that a lesser percentage affirmative vote or the vote of any other
class of stockholders may otherwise be required, by law or otherwise. The
Corporation expressly intends that this Article IX shall not apply to any
person that acquired an ownership interest in the Company prior to or in the
same transaction in which Motorola ceased to own fifty percent (50%) or more of
the votes entitled to be cast by the holders of all the then outstanding shares
of Voting Stock.
Section 2. EXCEPTIONS TO VOTE REQUIRED BY SECTION 1. The provisions of
Section 1 of this Article shall not be applicable to any particular Business
Combination, and such Business Combination shall require only such stockholder
vote, if any, as is required by law or by any other provision of the
certificate of incorporation or Bylaws of the Corporation, if all of the
conditions specified in either of the following paragraphs (a) or (b) are met
or, in the case of a Business Combination not involving the payment of
consideration to the holders of the Corporation's outstanding capital stock, if
the condition specified in the following paragraph (a) is met:
(a) CONTINUING DIRECTOR APPROVAL. The Business Combination shall
have been approved, either specifically or as a transaction which is within an
approved category of transactions, by a majority of the Continuing Directors
(as hereinafter defined), whether such approval is given prior to or subsequent
to the acquisition of, or announcement or public disclosure of the intention to
acquire, Beneficial Ownership of Voting Stock that caused the Interested
Stockholder to become an Interested Stockholder.
(b) OTHER CONDITIONS. All of the following conditions shall have
been met:
(i) the aggregate amount of cash and the Fair Market Value (as
hereinafter defined), as of the date of the consummation of the Business
Combination, of consideration other than cash to be received per share by
holders of Common Stock in such Business Combination shall be at least equal to
the highest amount determined under clauses (A) and (B) below:
(A) if applicable, the highest per share price (including
any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by
or on behalf of the
9
<PAGE>
Interested Stockholder for any share of Common Stock in connection with the
acquisition by the Interested Stockholder of Beneficial Ownership of shares of
Common Stock (x) within the two-year period immediately prior to the first
public announcement of the proposed Business Combination (the "ANNOUNCEMENT
DATE" ) or (y) in the transaction in which it became an Interested Stockholder,
whichever is higher, in either case as adjusted for any subsequent stock split,
stock dividend, subdivision or reclassification with respect to Common Stock;
and
(B) the Fair Market Value per share of Common Stock on the
Announcement Date or on the date on which the Interested Stockholder became an
Interested Stockholder (the "DETERMINATION DATE"), whichever is higher, as
adjusted for any subsequent stock split, stock dividend, subdivision or
reclassification with respect to Common Stock.
(ii) The aggregate amount of cash and the Fair Market Value, as
of the date of the consummation of the Business Combination, of consideration
other than cash to be received per share by holders of shares of any class or
series of outstanding capital stock, other than Common Stock, shall be at least
equal to the highest amount determined under clauses (A), (B), (C) and (D)
below:
(A) if applicable, the highest per share price (including
any brokerage commissions, transfer taxes and soliciting dealers' fees) paid by
or on behalf of the Interested Stockholder for any share of such class or
series of capital stock in connection with the acquisition by the Interested
Stockholder of Beneficial Ownership of shares of such class or series of
capital stock (x) within the two-year period immediately prior to the
Announcement Date or (y) in the transaction in which it became an Interested
Stockholder, whichever is higher, in either case as adjusted for any subsequent
stock split, stock dividend, subdivision or reclassification with respect to
such class or series of capital stock;
(B) the Fair Market Value per share of such class or series
of capital stock on the Announcement Date or on the Determination Date,
whichever is higher, as adjusted for any subsequent stock split, stock
dividend, subdivision or reclassification with respect to such class or series
of capital stock;
(C) if applicable, the price per share equal to the Fair
Market Value per share of such class or series of capital stock determined
pursuant to the immediately preceding clause (B), multiplied by the ratio of
(x) the highest per share price (including any brokerage commissions, transfer
taxes and soliciting dealers' fees) paid by or on behalf of the Interested
Stockholder for any share of such class or series of capital stock in
connection with the acquisition by the Interested Stockholder of Beneficial
Ownership of shares of such class or series of capital stock within the
two-year period immediately prior to the Announcement Date, as adjusted for any
subsequent stock split, stock dividend, subdivision or reclassification with
respect to such class or series of capital stock to (y) the Fair Market Value
per share of such class or series of capital stock on the first day in such
two-year period on which the Interested Stockholder acquired Beneficial
Ownership of any share of such class or series of capital stock, as adjusted
for any subsequent stock
10
<PAGE>
split, stock dividend, subdivision or reclassification with respect to such
class or series of capital stock; and
(D) if applicable, the highest preferential amount per
share to which the holders of shares of such class or series of capital stock
would be entitled in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Corporation, regardless of
whether the Business Combination to be consummated constitutes such an event.
The provisions of this paragraph (b) shall be required to be met with respect
to every class or series of outstanding capital stock, whether or not the
Interested Stockholder has previously acquired Beneficial Ownership of any
shares of a particular class or series of capital stock.
(iii) The consideration to be received by holders of a particular
class or series of outstanding capital stock shall be in cash or in the same
form as previously has been paid by or on behalf of the Interested Stockholder
in connection with its direct or indirect acquisition of Beneficial Ownership
of shares of such class or series of capital stock. If the consideration so
paid for shares of any class or series of capital stock varied as to form, the
form of consideration for such class or series of capital stock shall be either
cash or the form used to acquire Beneficial Ownership of the largest number of
shares of such class or series of capital stock previously acquired by the
Interested Stockholder.
(iv) After the Determination Date and prior to the consummation
of such Business Combination: (A) except as approved by a majority of the
Continuing Directors, there shall have been no failure to declare and pay at
the regular date therefor any full quarterly dividends (whether or not
cumulative) payable in accordance with the terms of any outstanding capital
stock; (B) there shall have been no reduction in the annual rate of dividends
paid on the Common Stock (except as necessary to reflect any stock split, stock
dividend, subdivision or reclassification with respect to the Common Stock),
except as approved by a majority of the Continuing Directors; (C) there shall
have been an increase in the annual rate of dividends paid on the Common Stock
as necessary to reflect any reclassification (including any reverse stock
split), recapitalization, reorganization or any similar transaction that has
the effect of reducing the number of outstanding shares of Common Stock, unless
the failure so to increase such annual rate is approved by a majority of the
Continuing Directors; and (D) such Interested Stockholder shall not have become
the beneficial owner of any additional shares of capital stock except as part
of the transaction that results in such Interested Stockholder becoming an
Interested Stockholder and except in a transaction that, after giving effect
thereto, would not result in any increase in the Interested Stockholder's
percentage Beneficial Ownership of any class or series of capital stock.
(v) A proxy or information statement describing the proposed
Business Combination and complying with the requirements of the Securities
Exchange Act of 1934 and the rules and regulations thereunder (the "ACT") (or
any subsequent provisions replacing such Act, rules or regulations) shall be
mailed to all stockholders of the Corporation at least 20 business days prior
to the consummation of such Business Combination (whether or not such proxy or
information statement is required to be mailed pursuant to such Act or
subsequent provisions). The proxy or
11
<PAGE>
information statement shall contain on the first page thereof, in a prominent
place, any statement as to the advisability (or inadvisability) of the Business
Combination that the Continuing Directors, or any of them, may choose to make
and, if deemed advisable by a majority of the Continuing Directors, the opinion
of an investment banking firm selected by a majority of the Continuing
Directors as to the fairness (or not) of the terms of the Business Combination
from a financial point of view to the holders of the outstanding shares of
capital stock other than the Interested Stockholder and its Affiliates or
Associates, such investment banking firm to be paid by the Corporation a
reasonable fee for its services.
(vi) Neither such Interested Stockholder nor any Affiliate or
Associate of such Interested Stockholder shall have acted on behalf of the
Corporation or any Subsidiary (as hereinafter defined) to cause any material
change in the business or equity capital structure of the Corporation or a
Subsidiary without the approval of a majority of the Continuing Directors.
Section 3. CERTAIN DEFINITIONS. For purposes of this Article, the
following definitions shall apply:
(a) The term "BUSINESS COMBINATION" shall mean:
(i) any merger or consolidation of the Corporation or any
Subsidiary with (A) any Interested Stockholder or (B) any other company
(whether or not itself an Interested Stockholder) which is or after such merger
or consolidation would be an Affiliate or Associate of an Interested
Stockholder; or
(ii) any (A) sale, lease, exchange, mortgage, pledge, transfer or
other disposition or hypothecation of assets of the Corporation or of any
Subsidiary (whether or not in connection with the dissolution of the
Corporation) to or for the benefit of, or (B) securities purchase by the
Corporation or any Subsidiary from or (C) issuance by the Corporation or any
Subsidiary of securities to or (D) investment, loan, advance, guarantee,
participation or other extension of credit by the Corporation or any Subsidiary
to, from, in or with or (E) establishment of a partnership, joint venture or
other joint enterprise with or for the benefit of, in each case, any Interested
Stockholder or any Affiliate or Associate of any Interested Stockholder which
transaction, alone or taken together with any related transaction or
transactions, has an aggregate Fair Market Value and/or involves aggregate
commitments of $25,000,000 or more or any arrangement, whether as employee,
consultant or otherwise (other than service as a director) pursuant to which
any Interested Stockholder or any Affiliate or Associate thereof shall,
directly or indirectly, attain any control over or responsibility for the
management of any aspect of the business or affairs of the Corporation which
involves assets which have an aggregate Fair Market Value of $25,000,000 or
more; or
(iii) the adoption of any plan or proposal for the liquidation or
dissolution of the Corporation; or
(iv) any (A) reclassification of securities (including any
reverse stock split), or (B) recapitalization of the Corporation (including any
change to or exchange of securities of the
12
<PAGE>
Corporation), or (C) any merger or consolidation of the Corporation with any of
its Subsidiaries or (D) any other transaction (whether or not with or otherwise
involving as a party an Interested Stockholder) that, in each case, has the
effect, directly or indirectly, of increasing the proportionate share of any
class or series of capital stock, or any securities convertible into or
exchangeable for capital stock or other equity securities, of the Corporation
or any Subsidiary that is Beneficially Owned by any Interested Stockholder or
any Affiliate or Associate of any Interested Stockholder; or
(v) any agreement, contract or other arrangement providing for
any one or more of the actions specified in the foregoing clauses (i) through
(iv).
(b) The term "PERSON" shall mean any individual, firm, company or
other entity and shall include any group comprised of any person and any other
person with whom such person or any Affiliate or Associate of such person has
any agreement, arrangement or understanding, directly or indirectly, for the
purpose of acquiring, holding, voting or disposing of capital stock.
(c) The term "INTERESTED STOCKHOLDER" shall mean any person (other
than (i) the Corporation or any Subsidiary, any profit-sharing, employee stock
ownership or other employee benefit plan of the Corporation or any Subsidiary
or any trustee or fiduciary with respect to any such plan or holding Voting
Stock for the purpose of funding any such plan or funding other employee
benefits for employees of the Corporation or any Subsidiary when acting in such
capacity and (ii) until immediately following the date on which Motorola and
any Affiliate or Associate thereof shall first cease to Beneficially Own shares
of Voting Stock representing ten percent (10%) or more of the votes entitled to
be cast by the holders of all then outstanding shares of Voting Stock, Motorola
or any company directly or indirectly controlled by Motorola and of which at
least a majority of the equity interests therein are directly or indirectly
beneficially owned by Motorola) who is, or has announced or publicly disclosed
a plan or intention to become, the Beneficial Owner of Voting Stock
representing ten percent or more of the votes entitled to be cast by the
holders of all then outstanding shares of Voting Stock.
(d) A person shall be a "BENEFICIAL OWNER" of any capital stock or
other securities of the Corporation: (i) which such person or any of its
Affiliates or Associates owns or has the economic benefit of ownership of,
directly or indirectly; (ii) which such person or any of its Affiliates or
Associates has, directly or indirectly, (A) the right to acquire (whether such
right is exercisable immediately or subject only to the passage of time),
pursuant to any agreement, arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or options, or otherwise, or (B)
the right to vote pursuant to any agreement, arrangement or understanding; or
(iii) any other person with which such person or any of its Affiliates or
Associates has any agreement, arrangement or understanding for the purpose of
acquiring, holding, voting or disposing of any shares of capital stock, owns or
has the economic benefit of ownership of. For the purposes of determining
whether a person is an Interested Stockholder pursuant to paragraph (c) of this
Section 3, the number of shares of capital stock of the Corporation deemed to
be outstanding shall include shares deemed beneficially owned by such person
through application of this paragraph (d) of this Section 3, but shall not
include any other shares of capital stock that may be
13
<PAGE>
issuable pursuant to any agreement, arrangement or understanding, or upon
exercise of conversion rights, warrants or options, or otherwise.
(e) The term "AFFILIATE" in respect of a person means any person
controlling, controlled by or under common control with such person.
(f) The term "ASSOCIATE" in respect of an individual means (i) any
corporation or other organization of which such person is an officer or partner
or otherwise participates in a material way in the management or policy-making
thereof or is the Beneficial Owner of ten percent (10%) or more of any class of
equity security, (ii) any trust or other estate in which such person has a
substantial beneficial interest or as to which such person serves as a trustee
or in a similar fiduciary capacity and (iii) any parent or lineal descendant of
such person or the spouse of such person or any relative of such person who has
the same home as such person or who is a director, officer, partner, limited
liability company member, trustee or other fiduciary of any organization of
which such person is also a director, officer, partner, limited liability
company member, trustee or other fiduciary or substantial beneficiary. The term
"ASSOCIATE" in respect of any company means (i) any director, officer or
trustee of such company or in the case of a limited liability company any
manager or managing member or in the case of a partnership any general partner,
(ii) any other person who participates in a material way in the management or
policy-making of such company and (iii) any person who is the Beneficial Owner
of ten percent (10%) or more of any class of equity security of such company.
(g) The term "SUBSIDIARY" means any company of which a majority of
any class of equity securities are directly or indirectly owned by the
Corporation.
(h) The term "CONTINUING DIRECTOR" with respect to an Interested
Stockholder means any member of the Board of Directors (while such person is a
member of the Board of Directors) who is not an Affiliate or Associate or
representative of such Interested Stockholder and who was a member of the Board
of Directors prior to the time that such Interested Stockholder became an
Interested Stockholder, and any successor of a Continuing Director (while such
successor is a member of the Board of Directors) who is not an Affiliate or
Associate or representative of such Interested Stockholder and is recommended
or elected to succeed the Continuing Director by a majority of the Continuing
Directors.
(i) The term "FAIR MARKET VALUE" means: (i) in the case of
cash, the amount of such cash; (ii) in the case of stock, the highest closing
sale price during the 30-day period immediately preceding the date in question
of a share of such stock on the Composite Tape for New York Stock
Exchange-Listed Stocks, or, if such stock is not quoted on the Composite Tape,
on the New York Stock Exchange, or, if such stock is not listed on such
Exchange, on the principal United States securities exchange registered under
the Act on which such stock is listed, or, if such stock is not listed on any
such exchange, the highest closing bid quotation with respect to a share of
such stock during the 30-day period preceding the date in question on The
Nasdaq Stock Market or any similar system then in use, or if no such quotations
are available, the fair market value on the date in question of a share of such
stock as determined by a majority of the Continuing Directors in good
14
<PAGE>
faith; and (iii) in the case of property other than cash or stock, the fair
market value of such property on the date in question as determined in good
faith by a majority of the Continuing Directors.
(j) In the event of any Business Combination in which the
Corporation survives the transaction as a juridic entity, the phrase
"consideration other than cash to be received" as used in clause (i) of
paragraph (b) of Section 2 of this Article shall include the shares of Common
Stock and/or the shares of any other class or series of capital stock retained
by the holders of such shares.
Section 4. CERTAIN DETERMINATIONS. A majority of the Continuing Directors
shall have the power and duty to determine for the purposes of this Article, on
the basis of information known to them after reasonable inquiry, all questions
arising under this Article, including, without limitation, (a) whether a person
is an Interested Stockholder, (b) the number of shares of capital stock or
other securities Beneficially Owned by any person, (c) whether a person is an
Affiliate or Associate of another person, (d) whether a Business Combination is
proposed by or on behalf of an Interested Stockholder or an Affiliate or
Associate of an Interested Stockholder or a person who upon consummation of
such Business Combination would become an Affiliate or Associate of such
Interested Stockholder, (e) whether the assets that are the subject of any
Business Combination have, or the consideration to be received for the issuance
or transfer of securities by the Corporation or any Subsidiary in any Business
Combination has, an aggregate Fair Market Value of $25,000,000 or more, and (f)
the application of any other term used in this Article. Any such determination
made in good faith shall be binding and conclusive on the Corporation, all of
its stockholders and all other parties.
Section 5. NO EFFECT ON FIDUCIARY OBLIGATIONS OF INTERESTED STOCKHOLDERS.
Nothing contained in this Article shall be construed to relieve any Interested
Stockholder from any fiduciary obligation imposed by law.
Section 6. COMPLIANCE WITH SECTION 2 DOES NOT OBLIGATE OR LIMIT BOARD OF
DIRECTORS. The fact that any Business Combination complies with the provisions
of Section 2 of this Article shall not be construed to impose any fiduciary
duty, obligation or responsibility on the Board of Directors, or any member
thereof, to approve such Business Combination or recommend its adoption or
approval to the stockholders of the Corporation, nor shall such compliance
limit, prohibit or otherwise restrict in any manner the Board of Directors, or
any member thereof, with respect to evaluations of or actions and responses
taken with respect to such Business Combination.
Section 7. BUSINESS COMBINATION PROPOSED BY AN INTERESTED STOCKHOLDER.
For the purposes of this Article, a Business Combination shall be presumed to
have been proposed by or on behalf of an Interested Stockholder or an Affiliate
or Associate of an Interested Stockholder or a person who upon consummation of
such Business Combination would become an Affiliate or Associate of an
Interested Stockholder if, after such Interested Stockholder became such, the
Business Combination is proposed following the election of any director of the
Corporation who with respect to such Interested Stockholder would not qualify
to serve as a Continuing Director.
15
<PAGE>
Section 8. AMENDMENT OF THIS ARTICLE. Notwithstanding anything to the
contrary elsewhere contained in the certificate of incorporation of the
Corporation, any proposal to alter, amend or repeal, or to adopt any provision
inconsistent with, this Article shall require the affirmative vote of the
holders of not less than 66-2/3% of the votes entitled to be cast by the
holders of all the then outstanding shares of Voting Stock, voting together as
a single class, excluding Voting Stock beneficially owned by any Interested
Stockholder; PROVIDED, HOWEVER, that this Section 8 shall not apply to, and
such 66-2/3% vote shall not be required for, any alteration, amendment or
repeal of, or the adoption of any provision inconsistent with, this Article
unanimously recommended by the Board of Directors if a majority of the
directors are persons who are Continuing Directors with respect to any
Interested Stockholder.
ARTICLE X
CERTAIN TRANSACTIONS WITH STOCKHOLDERS
AND ALLOCATION OF CORPORATE OPPORTUNITIES
Section 1. CERTAIN ACKNOWLEDGMENTS. In recognition and anticipation that
(i) the Corporation will cease to be a wholly owned subsidiary of Motorola but
that Motorola will remain, for a period of time, a substantial stockholder of
the Corporation, (ii) the directors, officers and/or employees of Motorola or
of Affiliated Companies (as defined below in this Article) of Motorola may
serve as directors and/or officers of the Corporation, (iii) Motorola and
Affiliated Companies thereof engage and may continue to engage in the same or
similar activities or related lines of business as those in which the
Corporation, directly or indirectly, may engage and/or other business
activities that overlap with or compete with those in which the Corporation,
directly or indirectly, may engage, (iv) that the Corporation and Affiliated
Companies thereof will engage in material business transactions with Motorola
and Affiliated Companies thereof and that the Corporation is expected to
benefit therefrom, and (v) that, as a consequence of the foregoing, it is in
the best interests of the Corporation that the respective rights and duties of
the Corporation and of Motorola and Affiliated Companies of Motorola, and the
duties of any directors or officers of the Corporation who are also directors,
officers or employees of Motorola or Affiliated Companies thereof, be
determined and delineated in respect of any transactions between the
Corporation and Affiliated Companies thereof, on the one hand, and Motorola and
Affiliated Companies thereof, on the other hand, the provisions of this Article
shall regulate and define the conduct of certain of the business and affairs of
the Corporation in relation to Motorola and Affiliated Companies thereof.
Section 2. CERTAIN AGREEMENTS AND TRANSACTIONS PERMITTED; CERTAIN
FIDUCIARY DUTIES OF CERTAIN STOCKHOLDERS, DIRECTORS AND OFFICERS. The
Corporation may from time to time enter into and perform, and cause or permit
any Affiliated Company of the Corporation to enter into and perform, one or
more agreements (or modifications or supplements to pre-existing agreements)
with Motorola or Affiliated Companies thereof pursuant to which the Corporation
or an Affiliated Company thereof, on the one hand, and Motorola or an
Affiliated Company thereof, on the other hand, agree to engage in transactions
of any kind or nature with each other or with Affiliated Companies thereof
and/or agree to compete, or to refrain from competing or to limit or restrict
their competition, with each other, including to allocate and to cause their
respective directors, officers and employees
16
<PAGE>
(including any who are directors, officers or employees of both) to allocate
opportunities between or to refer opportunities to each other. Subject to
Section 4 of this Article, no such agreement, or the performance thereof by the
Corporation or Motorola, or any Affiliated Company thereof, shall be considered
contrary to (i) any fiduciary duty that Motorola or any Affiliated Company
thereof may owe to the Corporation or any Affiliated Company thereof or to any
stockholder or other owner of an equity interest in the Corporation or any
Affiliated Company thereof by reason of Motorola or any Affiliated Company
thereof being a controlling stockholder of the Corporation or participating in
the control of the Corporation or of any Affiliated Company thereof or (ii) any
fiduciary duty of any director or officer of the Corporation or of any
Affiliated Company thereof who is also a director, officer or employee of
Motorola or any Affiliated Company thereof to the Corporation or such
Affiliated Company, or to any stockholder thereof, if any of the following
conditions shall have been satisfied:
(A) such agreement shall have been entered into before the
Corporation ceased to be a wholly-owned subsidiary of
Motorola and continued in effect in respect of any such
transaction or opportunity after such time; or
(B) such agreement shall have been approved (i) by the Board of
Directors of the Corporation by the affirmative vote of a
majority of the members (even though less than a quorum)
who are not Interested Persons (as defined below in this
Article) in respect of such agreement or (ii) by a
committee of the Board of Directors of the Corporation
constituted solely of members who are not Interested
Persons in respect of such agreement by the affirmative
vote of a majority of the members of such committee or
(iii) by one or more officers or employees of the
Corporation (including officers or employees of the
Corporation acting as directors, officers, trustees,
partners or members of, or in any similar capacity on
behalf of, any Affiliated Company of the Corporation)
who in each case is not an Interested Person in respect of
such agreement and to whom the authority to approve such
agreement has been delegated either by the Board of
Directors by the same affirmative vote required by
subclause (i) of this subparagraph for approval of such
agreement by the Board of Directors or by a committee of
the Board of Directors constituted as provided by and
acting by the same affirmative vote as required by
subclause (ii) of this subparagraph for approval of such
agreement by such committee or, in the case of an employee,
to whom such authority has been delegated by an officer to
whom authority to approve such agreement has been so
delegated; PROVIDED, HOWEVER, that, before approval of such
agreement, the material facts of the relationship between
the Corporation or such Affiliated Company thereof, on the
one hand, and Motorola or such Affiliated Company thereof,
on the other hand, and the material terms and facts as to
such agreement were disclosed to or were known by the
members of the Board of Directors or of such committee or
the officer or officers or employee or employees who acted
on approval of such agreement, as the case may be; or
17
<PAGE>
(C) such agreement was fair to the Corporation as of the time
it was entered into by the Corporation; or
(D) such agreement was approved by the affirmative vote of the
holders of a majority of the shares of capital stock of the
Corporation entitled to vote thereon and who do vote
thereon, exclusive of Motorola and any Affiliated Company
thereof and any Interested Person in respect of such
agreement; or
(E) in the case of any such transaction that was not entered
into in the performance of an agreement that satisfied the
requirements of clause (A), (B), (C) or (D) of this
sentence, such transaction shall have been approved or
ratified by (i) the Board of Directors of the Corporation
by the affirmative vote of a majority of the members (even
though less than a quorum) who are not Interested Persons
in respect of such transaction or (ii) by a committee of
the Board of Directors of the Corporation constituted
solely of members who are not Interested Persons in respect
of such transaction by the affirmative vote of a majority
of the members of such committee or (iii) by one or more
officers or employees of the Corporation (including
officers or employees of the Corporation acting as
directors, officers, trustees, partners or members of, or
in any similar capacity on behalf of, any Affiliated
Company of the Corporation) who in each case is not an
Interested Person in respect of such transaction and to
whom the authority to approve such transaction has been
delegated either by the Board of Directors by the same
affirmative vote required by subclause (i) of this
subparagraph for approval of such transaction by the Board
of Directors or a committee of the Board of Directors
constituted as provided by and acting by the same
affirmative vote as required by subclause (ii) of this
subparagraph for approval of such transaction by such
committee or, in the case of an employee, to whom such
authority has been delegated by an officer to whom
authority to approve such transaction has been so
delegated; PROVIDED, HOWEVER, that, before such approval or
ratification, the material facts of the relationship
between the Corporation or such Affiliated Company thereof,
on the one hand, and Motorola or such Affiliated Company
thereof, on the other hand, and the material facts as to
such transaction were disclosed to or were known by the
members of the Board of Directors or of such committee or
the officer or officers or employee or employees who acted
on approval or ratification of such transaction, as the
case may be; or
(F) in the case of any such transaction that was not entered
into in the performance of an agreement that satisfied the
requirements of clause (A), (B), (C) or (D) of this
sentence, such transaction was fair to the Corporation as
of the time it was entered into by the Corporation; or
18
<PAGE>
(G) in case of any such transaction that was not entered into
in the performance of an agreement that satisfied the
requirements of clause (A), (B), (C) or (D) of this
sentence, such transaction was approved or ratified by the
affirmative vote of the holders of a majority of the shares
of capital stock of the Corporation entitled to vote
thereon and who do vote thereon, exclusive of Motorola and
any Affiliated Company thereof and any Interested Person in
respect of such transaction.
Subject to Section 4 of this Article, neither Motorola nor any Affiliated
Company thereof, as a stockholder of the Corporation or participant in control
of the Corporation, shall have or be under any fiduciary duty to refrain from
entering into any agreement or participating in any transaction that meets the
requirements of any of clauses (A), (B), (C), (D), (E), (F) or (G) of the
immediately preceding sentence and no director, officer or employee of the
Corporation who is also a director, officer or employee of Motorola or any
Affiliated Company thereof shall have or be under any fiduciary duty to the
Corporation to refrain from acting on behalf of the Corporation or any
Affiliated Company thereof in respect of any such agreement or transaction or
performing any such agreement in accordance with its terms. Any person
purchasing or otherwise acquiring any shares of capital stock of the
Corporation, or any interest therein, shall be deemed to have notice of and to
have consented to the provisions of this Article. The failure of any agreement
or transaction between the Corporation or an Affiliated Company thereof, on the
one hand, and Motorola or an Affiliated Company thereof, on the other hand, to
satisfy the requirements of this Section shall not, by itself, cause such
agreement or transaction to constitute any breach of any fiduciary duty to the
Corporation or to any Affiliated Company thereof, or, any to stockholder or
other owner of an equity interest therein, by any controlling stockholder of
the Corporation or such Affiliated Company thereof or by any director or
officer of the Corporation.
Section 3. COMPETITION AND CORPORATE OPPORTUNITIES. None of Motorola or
any of its Affiliated Companies shall have any duty to refrain from engaging
directly or indirectly in the same or similar business activities or lines of
business as the Corporation or any of its Affiliated Companies, and neither
Motorola nor any officer or director thereof (except as provided in Section 4
below) shall be liable to the Corporation or its stockholders for breach of any
fiduciary duty solely by reason of any such activities of Motorola or any of
its Affiliated Companies. In the event that Motorola or any of its Affiliates
Companies acquires knowledge of a potential transaction or matter which may be
a corporate opportunity for itself and the Corporation or any of its Affiliated
Companies, none of Motorola or any of its Affiliated Companies shall have any
duty to communicate or offer such corporate opportunity to the Corporation or
any of its Affiliated Companies and shall not be liable to the Corporation or
its stockholders for breach of any fiduciary duty as a stockholder of the
Corporation solely by reason of the fact that Motorola or any of it Affiliated
Companies pursues or acquires such corporate opportunity for itself, directs
such corporate opportunity to another person, or does not communicate
information regarding such corporate opportunity to the Corporation.
Section 4. ALLOCATION OF CORPORATE OPPORTUNITIES. In the event that a
director , officer or employee of the Corporation who is also a director,
officer or employee of Motorola acquires
19
<PAGE>
knowledge of a potential transaction or matter which may be a corporate
opportunity for the Corporation or any of its Affiliated Companies and Motorola
or any of its Affiliated Companies, such director, officer or employee of the
Corporation shall have fully satisfied and fulfilled the fiduciary duty of such
director, officer or employee to the Corporation and its stockholders with
respect to such corporate opportunity, if such director, officer or employee
acts in a manner consistent with the following policy:
(a) A corporate opportunity offered to any person who is a director,
officer or employee of the Corporation, and who is also a director, officer or
employee of Motorola, shall belong to the Corporation if such opportunity is
expressly offered to such person in writing solely in his or her capacity as a
director
20
<PAGE>
or officer of the Corporation.
(b) Otherwise, such corporate opportunity shall belong to Motorola.
Section 5. CERTAIN MATTERS DEEMED NOT CORPORATE OPPORTUNITIES. In
addition to and notwithstanding the foregoing provisions of this Article X, a
corporate opportunity shall not be deemed to belong to the Corporation if it is
a business opportunity that the Corporation is not permitted to undertake under
the terms of Article III or that the Corporation is not financially able or
contractually permitted or legally able to undertake, or that is, from its
nature, not in the line of the Corporation's business or is of no practical
advantage to it or that is one in which the Corporation has no interest or
reasonable expectancy.
Section 6. CERTAIN DEFINITIONS. For purposes of this Article X, the
following definitions shall apply:
(A) "AFFILIATED COMPANY" shall mean in respect of Motorola any company
which is controlled by Motorola (other than the Corporation and any company
that is controlled by the Corporation), and in respect of the Corporation shall
mean any company controlled by the Corporation.
(B) "INTERESTED PERSON" in respect of an agreement or transaction
referred to in Section 2 of this Article shall mean any director, officer or
employee of Motorola or an Affiliated Company thereof and any person who has a
financial interest that is material to such person in Motorola or such
Affiliated Company or otherwise has a personal financial interest that is
material to such person in such agreement or transaction; PROVIDED, HOWEVER,
that no such financial interest shall be considered material by reason of a
person's ownership of securities of Motorola or an Affiliated Company thereof,
if such ownership of securities has been determined in good faith not to be
reasonably likely to influence such individual's decision on behalf of the
Corporation or an Affiliated Company thereof in respect of the agreement or
transaction either in the specific instance by, or pursuant to a policy adopted
by, the Board of Directors of the Corporation by the affirmative vote of a
majority of the members (even though less than a quorum) who are not directors,
officers or employees of Motorola or any Affiliated Company thereof or a
committee of the Board of Directors of the Corporation constituted solely of
members who are not directors, officers or employees of Motorola or any
Affiliated Company thereof by the affirmative vote of a majority of such
committee.
Section 7. TERMINATION. The provisions of this Article shall have no
further force or effect at such time as Motorola and any company controlling,
controlled by or under common control with Motorola shall first cease to be the
owner, in the aggregate, of Voting Stock representing five percent (5%) or more
of the votes entitled to be cast by the holders of all the then outstanding
shares of Voting Stock; PROVIDED, HOWEVER, that such termination shall not
terminate the effect of such provisions with respect to (i) any agreement
between the Corporation or an Affiliated Company
21
<PAGE>
thereof and Motorola or an Affiliated Company thereof that was entered into
before such time or any transaction entered into in the performance of such
agreement, whether entered into before or after such time, or (ii) any
transaction entered into between the Corporation or an Affiliated Company
thereof and Motorola or an Affiliated Company thereof.
Section 8. AMENDMENT OF THIS ARTICLE. Notwithstanding anything to the
contrary elsewhere contained in the certificate of incorporation of the
Corporation, the affirmative vote of the holders of at least 80% of the voting
power of all shares of Voting Stock then outstanding, voting together as a
single class, shall be required to alter, amend or repeal, or to adopt any
provision inconsistent with, this Article.
Section 9. DEEMED NOTICE. Any person or entity purchasing or otherwise
acquiring any interest in any shares of the Corporation shall be deemed to have
notice or and to have consented to the provisions of this Article X.
ARTICLE XI
DELAWARE SECTION 203
The Corporation hereby expressly elects to be governed by Section
203 of the DGCL beginning at such time as Motorola and any company controlling,
controlled by or under common control with Motorola shall first cease to be the
owner, in the aggregate, of Voting Stock representing fifty percent (50%) or
more of the votes entitled to be cast by the holders of all the then
outstanding shares of Voting Stock. The Corporation expressly elects not to be
governed by Section 203 of the DGCL prior to such time, and for the avoidance
of doubt, expressly intends that Section 203 shall not apply to any person who
becomes an interested stockholder within the meaning of Section 203 prior to
the time that the Corporation becomes governed by Section 203 in accordance
with this Article XI and furthermore expressly intends that Section 203 shall
not apply to any person that acquired an ownership interest in the Company
prior to or in the same transaction in which Motorola ceased to own fifty
percent (50%) or more of the votes entitled to be cast by the holders of all
the then outstanding shares of Voting Stock.
22
<PAGE>
ARTICLE XII
AMENDMENT OF CERTIFICATE OF INCORPORATION
The Corporation reserves the right at any time and from time to time
to amend, alter, change or repeal any provision contained in the certificate of
incorporation of the Corporation in accordance with its terms, as from time to
time in effect, and to add thereto any other provision authorized by the laws
of the State of Delaware at the time in force, and, except as may otherwise be
explicitly provided by any provision of the certificate of incorporation of the
Corporation, all rights, preferences and privileges of whatsoever nature
conferred upon stockholders, directors or officers of the Corporation or any
other person whomsoever by and pursuant to the certificate of incorporation of
the Corporation in its present form, or as hereafter amended, are granted
subject to the right reserved in this Article. Any provision of the certificate
of incorporation of the Corporation may be altered, amended or repealed, and
any inconsistent provision may be added, by such action (if any) of the Board
of Directors and the stockholders, and otherwise in such manner, as is provided
herein and by law; PROVIDED, HOWEVER, that, in addition to any other vote of
stockholders (if any) required by law and notwithstanding that a lower vote (or
no vote) of stockholders otherwise would be required, (a) if any provision of
the certificate of incorporation of the Corporation other than this Article
requires a particular vote of stockholders in order to alter, amend or repeal,
or adopt any provision inconsistent with, any provision of the certificate of
incorporation of the Corporation, then such vote of stockholders shall be
required for such change and (b) the vote of stockholders required to alter,
amend or repeal, or adopt any provision inconsistent with, this proviso shall
be the affirmative vote of the holders of at least 80% of the Voting Stock then
outstanding, voting together as a single class.
* * * *
23
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this Amended and
Restated Certificate of Incorporation to be duly executed this _____ day of
__________ __, 2000.
PROPEL, INC.
By: __________________________
Name:
Title:
24
