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EXHIBIT 3.2
RESTATED CERTIFICATE OF INCORPORATION
OF
TALITY CORPORATION
The undersigned, Robert P. Wiederhold and Duane W. Bell, in accordance
with the provisions of Sections 242 and 245 of the General Corporation Law of
the State of Delaware, hereby certify that:
1. They are the duly elected and acting President and Secretary,
respectively, of Tality Corporation, a Delaware corporation.
2. The name of this corporation is Tality Corporation. Tality
Corporation was originally incorporated under the same name and the original
Certificate of Incorporation was filed with the Secretary of State of Delaware
on July 13, 2000.
3. The Amendment and Restatement of this corporation's Certificate of
Incorporation, as set forth below, has been approved by this corporation's Board
of Directors and stockholders and was duly adopted in accordance with the
provisions of Sections 242 and 245 of the General Corporation Law of the State
of Delaware.
4. The Certificate of Incorporation of this corporation be, and it
hereby is, amended and restated to read in its entirety as follows:
CERTIFICATE OF INCORPORATION
ARTICLE I
NAME OF CORPORATION
The name of this Corporation is:
TALITY CORPORATION
ARTICLE II
REGISTERED OFFICE
The registered office of Tality Corporation (hereinafter called the
"Corporation") in the State of Delaware shall be at 615 South Dupont Highway,
City of Dover, County of Kent, and the name of the registered agent in charge
thereof shall be National Corporate Research Ltd.
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ARTICLE III
PURPOSE
Subject to such limitations as are stated herein, the purpose of the
Corporation is to engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of Delaware, as may be
amended or replaced (the "DGCL").
ARTICLE IV
AUTHORIZED CAPITAL STOCK
SECTION 1. Number of Authorized Shares. The total number of shares
of all classes of stock that the Corporation shall have authority to issue is
four hundred sixty-five million one thousand (465,001,000) shares, consisting of
four hundred sixty million one thousand (460,001,000) shares of common stock,
par value $0.001 per share (the "Common Stock"), and five million (5,000,000)
shares of preferred stock, par value $0.001 per share (the "Preferred Stock").
The number of authorized shares of any class of Common 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 voting power of the
Corporation and without the separate vote of any single class of Common Stock.
SECTION 2. Authorized Common Stock. The Common Stock shall consist
solely of three classes designated "Class A Common Stock," "Class B Common
Stock," and "Class C Common Stock." The authorized number of shares of Class A
Common Stock shall be three hundred million (300,000,000), the authorized number
of shares of Class B Common Stock shall be one thousand (1,000), and the
authorized number of shares of Class C Common Stock shall be one hundred sixty
million (160,000,000). The Board of Directors of the Corporation (the "Board of
Directors") may (or, as specified below, shall) authorize the issuance of shares
of Class A Common Stock, shares of Class B Common Stock and shares of Class C
Common Stock from time to time subject to the foregoing.
SECTION 3. Terms of Common Stock; Voting.
(a) Rights and Privileges; Voting Rights.
(i) All shares of Common Stock will be identical in all respects
and will entitle the holders thereof to the same rights and privileges, except
as expressly provided otherwise in this Certificate of Incorporation. Except as
expressly specified otherwise herein, all classes of Common Stock shall vote
together as a single class on all matters submitted to a vote of the
stockholders.
(ii) The Class C Common Stock shall be issuable only to Cadence
Design Systems, Inc., a Delaware corporation ("Cadence"), or any Subsidiary
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(as defined below) of Cadence and only if both of the following requirements are
met: (x) such issuance occurs in connection with a Tax-Free Spin-Off (as defined
below); and (y) such issuance occurs upon an acquisition by the Corporation,
whether by assignment, merger or otherwise, directly or through one or more
Subsidiaries, of all outstanding shares of Class B Common Stock and Limited
Partnership Units (as defined below) then held by Cadence or any of its
Subsidiaries.
(iii) The holders of shares of Common Stock shall have the
following voting rights:
(A) Except as provided in Section 3(a)(v) of this Article
IV, each holder of a share of Class A Common Stock shall be entitled to cast one
vote on all matters submitted to a vote of the stockholders of the Corporation
for each share of Class A Common Stock held by such holder.
(B) Each holder of a share of Class B Common Stock shall be
entitled to cast the aggregate number of votes on all matters submitted to a
vote of the stockholders of the Corporation equal to the sum of (x) the number
of shares of Class B Common Stock held by such holder plus (y) the number of
Limited Partnership Units held by such holder.
(C) Except as provided in Section 3(a)(v) of this Article
IV, each holder of a share of Class C Common Stock shall, for each share of
Class C Common Stock held by such holder, be entitled to cast that number of
votes on all matters submitted to a vote of the stockholders of the Corporation
equal to the Class C Per-Share Vote, determined as provided in Section 3(a)(iv)
below.
(iv) The "Class C Per-Share Vote" shall equal that number of
votes per share necessary so that, immediately prior to a Tax-Free Spin-Off, the
aggregate voting power of all shares of Class C Common Stock, when added to the
voting power of all shares, if any, of Class A Common Stock held by Cadence and
its Subsidiaries, equals eighty percent (80%) of the sum of: (A) the total
combined voting power of all outstanding capital stock of the Corporation, plus
(B) the voting power underlying shares potentially issuable under any
outstanding options, warrants, convertible or exchangeable securities (including
Limited Partnership Units) or other rights or contracts that could result in any
Person (as defined below) owning a voting interest in the Corporation.
Notwithstanding the foregoing, if counsel for Cadence reasonably determines in
connection with advising Cadence with respect to Tax-Free Spin-Off that, in
order for the Tax-Free Spin-Off to be tax free to Cadence, its Subsidiaries or
its stockholders, the Class C Per-Share Vote should be increased beyond the
figure produced by application of the foregoing provisions of this Section
3(a)(iv), or in the event Cadence and the Corporation agree that the Class C
Per-Share Vote can be reduced below the figure produced by application of the
foregoing provision without adversely affecting the tax-free nature of the
Tax-Free Spin-Off, then the Class C Per-Share Vote shall be that number
indicated by such counsel, or agreed to by Cadence and the Corporation, as the
case may be, delivered in writing to the Secretary of the Corporation no later
than fifteen (15) days prior to consummation of the Tax-Free Spin-
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Off. A copy of such writing shall be made available to any stockholder upon
request of the Secretary of the Corporation.
(v) Only the holders of Class B Common Stock shall be entitled
to vote on a Spin-Off Merger (as defined below). As used herein, a "Spin-Off
Merger" shall mean a merger of the Corporation or one or more of its
Subsidiaries with one or more Subsidiaries of Cadence that own Limited
Partnership Units, which merger is effected solely in order to facilitate a
Tax-Free Spin-Off. A Spin-Off Merger may be effected only if it satisfies the
following requirements:
(A) Prior to the merger, each constituent Person other than
the Corporation shall have no assets or liabilities, subject only to de minimus
exceptions, other than shares of Common Stock, Preferred Stock or Limited
Partnership Units or direct or indirect interests in Persons owning Common
Stock, Preferred Stock or Limited Partnership Units.
(B) The Corporation shall have received an opinion of its
counsel or counsel to Cadence, or a ruling from the Internal Revenue Service, to
the effect that the Spin-Off Merger will qualify as a reorganization under
Section 368(a) of the Code.
(C) If the surviving Person in the Spin-Off Merger is the
Corporation, or if the Corporation becomes the parent corporation of one or more
other constituent Persons:
(1) the outstanding shares of stock of each other
constituent Person shall be converted into (x) that number of shares of Class C
Common Stock equal to the aggregate number of shares of Class B Common Stock and
Limited Partnership Units then held by such other constituent Person, plus (y)
that number of shares of Class A Common Stock equal to the number of shares of
Class A Common Stock then held directly or indirectly by such other constituent
Person, plus (z) that number of shares of Preferred Stock having rights that are
the same as the powers, preferences and rights of any shares of Preferred Stock
then held directly or indirectly by such other constituent Person; provided,
however, that any shares of Class A Common Stock, Class B Common Stock and
Preferred Stock then held by such other constituent Person shall not be so
converted, but rather shall be cancelled immediately upon consummation of the
Spin-Off Merger; and
(2) If (x) the surviving Person in the Spin-Off Merger
is the Corporation, each outstanding share of stock of the Corporation, other
than those shares held by each other constituent Person, shall remain
outstanding and unaffected by the Spin-Off Merger or (y) the Corporation becomes
the parent corporation of one or more other constituent Persons through the
merger of such constituent Persons into a Subsidiary of the Corporation, each
outstanding share of stock of the Subsidiary of the Corporation shall remain
outstanding and unaffected by the Spin-Off Merger.
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(D) If the surviving Person in the Spin-Off Merger is a
Subsidiary of Cadence, or if a Subsidiary of Cadence becomes the parent of the
Corporation and the other constituent Persons:
(1) such Cadence Subsidiary shall have classes of common
and preferred stock which are the same, in all material respects, as the Class A
Common Stock, Class B Common Stock, Class C Common Stock and any Preferred Stock
then outstanding;
(2) each outstanding share of Class A Common Stock shall
be converted into one share of class A common stock of such Cadence Subsidiary,
each outstanding share of Class B Common Stock shall be converted into one share
of class B common stock of such Cadence Subsidiary and each outstanding share of
Preferred Stock shall be converted in one share of preferred stock of such
Cadence Subsidiary having the same powers, preferences and privileges as such
share of Preferred Stock; provided, however, that shares of Class A Common
Stock, Class B Common Stock and Preferred Stock then held by such Cadence
Subsidiary shall not be so converted, but rather shall be cancelled immediately
upon consummation of the Spin-Off Merger; and
(3) the outstanding capital stock of such Cadence
Subsidiary shall be converted into (x) that number of shares of class A common
stock of such Cadence Subsidiary equal to the number of shares of Class A Common
Stock then held by such Cadence Subsidiary, plus (y) that number of shares of
class C common stock of such Cadence Subsidiary which is equal to the number of
shares of Class B Common Stock and Limited Partnership Units then held by such
Cadence Subsidiary, plus (z) that number of shares of preferred stock of such
Cadence Subsidiary having the same powers, preferences and rights, as any
Preferred Stock then held by such Cadence Subsidiary.
(b) Dividends and Distributions.
(i) Subject to the preferences applicable to any Preferred Stock
outstanding at any time, the holders of shares of Common Stock shall be entitled
to receive such dividends and other distributions in cash, property or shares of
stock of the Corporation as may be declared thereon by the Board of Directors
from time to time out of assets or funds of the Corporation legally available
therefor; provided, however, that, subject to the other provisions of this
subsection (b), the Corporation shall not pay dividends or make other
distributions to holders of any class of Common Stock, unless simultaneously
with such dividend or other distribution the Corporation makes the same per
share dividend or other distribution with respect to each outstanding share of
other Classes of Common Stock.
(ii) In the case of a dividend or other distribution payable in
Class A Common Stock, Class B Common Stock or Class C Common Stock (including
any distribution pursuant to a stock split or division of Class A Common Stock
Class B Common Stock or Class C Common Stock), only shares of Class A Common
Stock shall be distributed with respect to Class A Common Stock, only shares of
Class B
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Common Stock shall be distributed with respect to Class B Common Stock, and only
shares of Class C Common Stock shall be distributed with respect to Class C
Common Stock. In the case of any such dividend or other distribution payable in
shares of Class A Common Stock, Class B Common Stock or Class C Common Stock,
the number of shares of each class of Common Stock payable per share of such
class of Common Stock shall be equal.
(iii) In the case of a dividend or other distribution consisting
of voting securities of the Corporation other than Common Stock or of voting
securities of any Person that is a wholly owned subsidiary of the Corporation,
the Corporation shall declare and pay such dividend or other distribution in
separate classes of such voting securities, identical in all respects, except
that: (A) the voting rights of each such security issued to the holders of Class
A Common Stock, Class B Common Stock and Class C Common Stock shall be identical
to the voting rights of the respective classes of Common Stock held by such
holders in accordance with Section 3(a)(iii) above; and (B) such security issued
to the holders of Class B Common Stock shall convert into the security issued to
the holder of Class A Common Stock upon the same terms and conditions applicable
to the conversion of Class B Common Stock into Class A Common Stock. In the case
of any such dividend or distribution, the number of such securities payable per
share of each class of Common Stock shall be equal.
(iv) In the case of a dividend or other distribution consisting
of securities convertible into, or exchangeable for, voting securities of the
Corporation or voting securities of another Person that is a wholly owned
subsidiary of the Corporation, the Corporation shall provide that such
convertible or exchangeable securities, and the securities underlying such
convertible or exchangeable securities, be identical in all respects (including,
without limitation, the conversion or exchange rate), except that: (A) the
voting rights of each security underlying the convertible or exchangeable
security issued to the holders of Class A Common Stock, Class B Common Stock and
Class C Common Stock shall have the same relationship to each other as provided
for Class A Common Stock, Class B Common Stock and Class C Common Stock in
Section 3(a)(iii) above; and (B) such underlying securities issuable to the
holders of the Class B Common Stock shall convert into the underlying securities
issued to the holders of Class A Common Stock upon the same terms and conditions
applicable to the conversion of Class B Common Stock into Class A Common Stock.
(c) Conversion of Class B Common Stock; Exchange of Limited
Partnership Units.
(i) The holders of Class B Common Stock shall be entitled to
convert, at any time and from time to time, each share of Class B Common Stock
into one (1) fully paid and non-assessable share of Class A Common Stock. Such
right shall be exercised by the surrender to the Corporation of the certificate
or certificates representing the shares of Class B Common Stock to be converted
at any time during normal business hours at the principal executive offices of
the Corporation or at the office of the Corporation's transfer agent (the
"Transfer Agent"), accompanied by a written notice from the holder of such
shares stating that such holder desires to convert such shares, or a stated
number of the shares represented by such certificate or
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certificates, into an equal number of shares of Class A Common Stock, and (if so
required by the Corporation or the Transfer Agent) by instruments of transfer,
in form satisfactory to the Corporation and to the Transfer Agent, duly executed
by such holder or such holder's duly authorized attorney, and transfer tax
stamps or funds therefor, if required pursuant to Section 3(e)(iii) below.
(ii) Upon the transfer (other than the original issuance) of any
share of Class B Common Stock to any Person other than the original holder
thereof, such share shall immediately and automatically (and without any action
on the part of the holder) convert into one (1) fully paid and non-assessable
share of Class A Common Stock; provided, however, that no such conversion shall
occur solely as a result of the pledge or hypothecation of, or existence of any
other lien or encumbrance on, any Class B Common Stock, and no such conversion
shall occur solely as a result of a transfer by the original holder thereof or
one of its Subsidiaries to the original holder thereof or one of its
Subsidiaries; provided further, that such share of Class B Common Stock shall
immediately and automatically (and without any action on the part of the holder)
convert into one (1) fully paid and nonassessable share of Class A Common Stock
at any time such holder is no longer a Subsidiary of the original holder of such
share of Class B Common Stock.
(iii) Subject to adjustment as provided in Section 3(f) below,
in accordance with and subject to the terms of the Partnership Agreement, the
holders of Limited Partnership Units (other than the Corporation and its
Subsidiaries) shall be entitled to exchange, at any time and from time to time,
each of their Limited Partnership Units into one (1) fully paid and
non-assessable share of Class A Common Stock. Such right shall be exercised in
the manner provided in the Partnership Agreement.
(iv) As promptly as practicable following the surrender for
conversion of a certificate representing shares of Class B Common Stock in the
manner provided in Section 3(c)(i) or (ii) above, or upon the surrender for
exchange of Limited Partnership Units in the manner provided in the Partnership
Agreement (if the Corporation is to issue newly issued shares of Class A Common
Stock upon such surrender), as applicable, and the payment in cash of any amount
required by Section 3(e)(iii) below, the Corporation shall deliver or cause to
be delivered at the office of the Transfer Agent, a certificate or certificates
representing the number of full shares of Class A Common Stock issuable upon
such conversion or exchange, issued in such name or names as such holder may
direct. Such conversion or exchange shall be deemed to have been effected
immediately prior to the close of business on the date of the giving of the
required written notice and surrender of any certificate or certificates
representing shares of Class B Common Stock or Limited Partnership Units, as the
case may be; provided, however, that the Corporation may delay the effective
date of such exchange with respect to no more than one (1) Limited Partnership
Unit for up to fifteen (15) days to the extent it reasonably deems such delay
necessary in order implement steps to avoid a dissolution of the Partnership (as
defined below) under the Delaware Revised Uniform Limited Partnership Act, 6
Del.C. Section 17-101, et seq., as amended from time to time (the "Delaware
Partnership Act") by reason of the Partnership having only one partner. Upon
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the date any such conversion or exchange is made or effected, all rights of the
holder of such shares of Class B Common Stock or Limited Partnership Units as
such holder shall cease, and the Person or Persons in whose name or names the
certificate or certificates representing the shares of Class A Common Stock are
to be issued shall be treated for all purposes as having become the record
holder or holders of such shares of Class A Common Stock.
(v) Shares of Class B Common Stock that are converted into
shares of Class A Common Stock shall continue to be authorized shares of Class B
Common Stock and available for reissuance by the Corporation as treasury shares
or, after their retirement, as authorized but unissued shares of Class B Common
Stock; provided, however, that no shares of Class B Common Stock shall be
reissued except as expressly permitted by Section 3(b) above or Section 3(f)
below.
(d) Conversion of Class B Common Stock into, and Exchange of Limited
Partnership Units for, Class C Common Stock.
(i) Subject to Section 3(a)(ii) of this Article IV, at any time
that Cadence and its Subsidiaries shall own in the aggregate thirty percent
(30%) or more of the total combined voting power of the Corporation, in order to
facilitate a Tax-Free Spin-Off, Cadence and its Subsidiaries (other than the
Corporation and its Subsidiaries) shall have the right to transfer all (but not
less than all) of their Limited Partnership Units and shares of Class B Common
Stock to the Corporation in exchange for the issuance by the Corporation to such
Persons of that number of shares of Class C Common Stock equal to the number of
Limited Partnership Units and shares of Class B Common Stock transferred to the
Corporation.
(ii) The transfer of shares of Class B Common Stock and Limited
Partnership Units in exchange for shares of Class C Common Stock shall be
effected by written notice to the Corporation stating the desire to transfer
such shares and Limited Partnership Units as described in paragraph (i) above.
Any such transfer shall be effected as of the close of business on the date
immediately preceding the date of the Tax-Free Spin-Off (or, if requested by
Cadence, on the date of the Tax-Free Spin-Off) and at such time the rights of
the holders of such shares and Limited Partnership Units as such holders shall
cease and such holders shall be treated for all purposes as having become the
record owners of shares of Class C Common Stock issuable upon such transfer on
such date.
(e) Certain Provisions Relating to Stock Conversion and Exchange of
Limited Partnership Units.
(i) In the event of a reclassification or other similar
transaction as a result of which the shares of Class A Common Stock are
converted into another security, then the holders of any outstanding shares of
Class B Common Stock shall be entitled to receive upon conversion thereof the
amount of such security that such holder would have received if it had effected
such conversion immediately prior to the record date of such reclassification or
other similar transaction. Except as set forth in the preceding sentence, no
adjustments in respect of dividends or other distributions shall be
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made upon the conversion of any share of Class B Common Stock; provided,
however, that if a share of Class B Common Stock shall be converted into a share
of Class A Common Stock after the record date for the payment of a dividend or
other distribution on shares of Class B Common Stock but prior to such payment,
then the registered holder of such share at the close of business on such record
date shall be entitled to receive the dividend or other distribution payable on
such share on such date notwithstanding the conversion thereof or the default in
payment of the dividend or other distribution due on such date.
(ii) The Corporation shall at all times reserve and keep
available out of its authorized but unissued shares of Class A Common Stock and
Class C Common Stock, solely for the purpose of issuance upon conversion,
exchange or transfer of outstanding shares of Class B Common Stock and Limited
Partnership Units (including pursuant to a Spin-Off Merger), such number of
shares of Class A Common Stock or Class C Common Stock that shall be issuable
upon the conversion of all such outstanding shares of Class B Common Stock and
the exchange of all such outstanding Limited Partnership Units. If any shares of
Class A Common Stock or Class C Common Stock require registration with or
approval of any governmental authority under any federal or state law before
such shares of Class A Common Stock or Class C Common Stock may be issued upon
conversion, exchange or transfer, or before such shares may be distributed to
Cadence stockholders in connection with a Tax-Free Spin-Off or sold by such
Cadence stockholders thereafter without restriction under applicable law, the
Corporation shall cause such shares to be duly registered or approved, as the
case may be. The Corporation shall use its best efforts to list the shares of
Class A Common Stock and Class C Common Stock required to be delivered upon such
conversion, exchange or transfer (including pursuant to a Spin-Off Merger) prior
to such delivery on each national securities exchange on which the outstanding
Common Stock is listed at the time of such delivery. The Corporation covenants
and warrants that all shares of Class A Common Stock and Class C Common Stock
issued upon conversion of shares of Class B Common Stock or exchange of Limited
Partnership Units (including pursuant to a Spin-Off Merger) will, upon issuance,
be validly issued, fully paid and non-assessable.
(iii) The issuance of certificates for shares of Class A Common
Stock and Class C Common Stock upon conversion of shares of Class B Common Stock
or exchange of Limited Partnership Units (including pursuant to a Spin-Off
Merger) shall be made without charge to the holders of such shares or Limited
Partnership Units for any stamp or other similar tax in respect of such
issuance; provided, however, that if any such certificate is to be issued in a
name other than that of the holder of the share or shares of Class B Common
Stock converted or the Limited Partnership Units exchanged, then the Person or
Persons requesting the issuance thereof shall pay to the Corporation the amount
of any tax that may be payable in respect of any transfer involved in such
issuance or shall establish to the satisfaction of the Corporation that such tax
has been paid or is not payable.
(f) Stock Splits. Without the unanimous approval of all holders of
Class A Common Stock, Class B Common Stock and Class C Common Stock, the
Corporation shall not in any manner subdivide (by any stock split, stock
dividend,
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reclassification, recapitalization or otherwise) or combine (by reverse stock
split, reclassification, recapitalization or otherwise) the outstanding shares
of one class of Common Stock unless the outstanding shares of all classes of
Common Stock shall be proportionately subdivided or combined. The exchange
rights for Limited Partnership Units shall be adjusted appropriately if there
is: (A) any subdivision (by any unit split, unit distribution, reclassification,
recapitalization or otherwise) or combination (by reverse unit split,
reclassification, recapitalization or otherwise) of the Limited Partnership
Units that is not accompanied by an identical subdivision or combination of the
Common Stock; or (B) any subdivision (by any stock split, stock dividend,
reclassification, recapitalization or otherwise) or combination (by reverse
stock split, reclassification, recapitalization or otherwise) of the Common
Stock that is not accompanied by an identical subdivision or combination of the
Limited Partnership Units.
(g) Options, Rights or Warrants.
(i) Except as set forth herein, without the unanimous approval
of all holders of Class A Common Stock, Class B Common Stock and Class C Common
Stock, the Corporation shall not make any offering or distribution of options,
rights or warrants to subscribe for shares of Class B Common Stock or Class C
Common Stock. If the Corporation makes an offering or distribution to all
holders of a class of Common Stock of options, rights or warrants to subscribe
for shares of any class or classes of its capital stock other than Class B
Common Stock or Class C Common Stock, then the Corporation shall simultaneously
make a similar offering or distribution of the same number of options, rights or
warrants per share which options, warrants or rights offered or distributed to
each class of Common Stock shall entitle the holder, upon exercise thereof, to
purchase the same class of Common Stock as the shares with respect to which such
options, warrants or rights were offered or distributed to all holders of the
other outstanding class of Common Stock, except that it need not make such
offering or distribution to such class of Common Stock all the holders of which,
voting as a separate class, determine that such offering or distribution need
not be made to such class.
(ii) Subject to Section 3(g)(i) above, the Corporation shall
have the power to create and issue, whether or not in connection with the
issuance and sale of any shares of stock or other securities of the Corporation,
rights, options or warrants entitling the holders thereof to purchase from the
Corporation any shares of its capital stock of any class or classes at the time
authorized (other than Class B Common Stock or Class C Common Stock), such
rights, options or warrants to have such terms and conditions, and to be
evidenced by or in such instrument or instruments, as shall be approved by the
Board of Directors.
(h) Mergers, Consolidation, Etc. Except in the event of a Tax-Free
Spin-Off, the Corporation shall not, without the approval of a majority of the
voting power of the outstanding shares of Class B Common Stock (if any such
shares are then outstanding), enter into any consolidation, merger, combination,
recapitalization, reclassification or other transaction in which shares of
Common Stock are exchanged for or converted into other stock or other
securities, cash and/or any other property unless in
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such event, the shares of each class of Common Stock shall be exchanged for or
converted into like classes of capital stock of the surviving Person that differ
only in their respective voting rights, which shall be the same as the voting
rights enjoyed by each class of Common Stock pursuant to Section 3(a)(iii)
above.
(i) No Preemptive Rights. Except as provided in Section 3(g)
above, the holders of shares of Common Stock are not entitled to any preemptive
right to subscribe for, purchase or receive any part of any new or additional
issue of stock of any class of the Corporation, whether now or hereafter
authorized, or of bonds, debentures or other securities convertible into or
exchangeable for stock of the Corporation.
SECTION 4. Preferred Stock. The Board of Directors is authorized,
subject to any limitations prescribed by law, to provide for the issuance of
shares of Preferred Stock in series, and by filing a certificate pursuant to the
DGCL (such certificate being 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 (including any
voting powers), preferences and rights of the shares of each such series and any
qualifications, limitations or restrictions thereof. 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 majority vote of
the holders of the 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 the terms of any Preferred Stock Designation. Notwithstanding the
foregoing, the Corporation shall not issue any shares of preferred stock other
than "voting stock" (as determined for purposes of applying Section 368(c) of
the Code) without the prior approval of a majority of the voting power of the
Class B common stock until such time as: (i) there has been effected a Tax-Free
Spin-Off or (ii) Cadence and its Subsidiaries shall own in the aggregate less
than thirty percent (30%) of the total combined voting power of the Corporation.
ARTICLE V
RELATIONSHIP WITH CADENCE DESIGN SYSTEMS, INC.
SECTION 1. Corporate Opportunities.
(a) Except as Cadence may otherwise agree in writing, Cadence may
engage or invest, and avail itself of opportunities, in the same or similar
business activities or lines of business as the Corporation. Except in the case
of a Corporate Opportunity (as defined below), the Corporation shall have no
interest or expectancy in any such engagement, investment or opportunity or any
interest or expectancy that Cadence will not engage in any of the foregoing
activities, any such interest or expectancy being hereby renounced by the
Corporation so that Cadence shall not violate any duty to the Corporation by
engaging in, investing in, or availing itself of opportunities in any such
business activities or line of business.
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(b) For purposes of this Certificate of Incorporation, "Corporate
Opportunity" shall mean a transaction, potential transaction or other business
opportunity that (i) the Corporation is financially able to undertake, (ii)
relates exclusively to the Business (as defined below), (iii) is one in which
the Corporation has or, but for the effect of this Article V the Corporation
would have, an interest or reasonable expectancy and (iv) if offered to a
director, officer or employee of the Corporation who is also a director, officer
or employee of Cadence, such transaction, potential transaction or other
business opportunity is offered to him or her solely in his or her capacity as a
director, officer or employee of the Corporation; provided, however, that a
"Corporate Opportunity" shall not include (A)(1) any transaction in which the
Corporation or Cadence is permitted to participate pursuant to any agreement
between them in effect as of the time any equity security of the Corporation is
first held of record by any Person other than Cadence or any director, officer
or employee of Cadence or the Corporation, or as may be amended thereafter with
the approval of a majority of the Disinterested Directors (as defined below), or
(2) any such transaction provided for in any subsequent agreement between the
Corporation and Cadence approved by a majority of the Disinterested Directors;
(B) any transaction, potential transaction or other business opportunity that is
offered to or learned of by a director, officer or employee of Cadence (other
than as described in clause (iv) above) by or from a Person other than the
Corporation or (C) any transaction, potential transaction or other business
opportunity that arises from ideas independently conceived, acquired or
developed by Cadence.
(c) For purposes of this Certificate of Incorporation (i) "Business"
shall mean the business of providing electronic design engineering services, and
intellectual property in connection therewith, to electronic equipment
manufacturers; and (ii) "Disinterested Directors" shall mean the directors of
the Corporation who are not officers or directors of Cadence.
(d) In the case of a Corporate Opportunity, Cadence shall have such
duties as would exist in the absence of this Article V.
SECTION 2. Intercompany Agreements.
In any action by or in the right of the Corporation against Cadence or
any of its officers, directors, employees in which the fairness of any agreement
or transaction to which any such Person is a party or in which any such Person
may have a financial interest, shall be an issue: (1) the burden of proof on the
issue of fairness shall be on the Person seeking to establish unfairness; and
(2) fairness shall be deemed to have been established in any of the following
circumstances:
(a) the conditions set forth in Section 144 of the DGCL or any
successor provision, as in effect from time to time, are satisfied;
(b) the agreement or transaction is effected in accordance with
guidelines approved by a majority of the Disinterested Directors; or
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(c) the terms of the transaction or agreement are not materially
less favorable to the Corporation than those made available by Cadence to
unaffiliated Persons under similar circumstances.
The provisions of this Section 2 shall not be construed to limit or
restrict any defenses that would be available to Cadence or any of its officers,
directors, employees or agents in the absence of this provision.
SECTION 3. General Provisions and Certain Definitions.
(a) Any Person purchasing or otherwise acquiring any interest in any
shares of stock or other securities of the Corporation shall be deemed to have
notice of and to have consented to the provisions of this Article V.
(b) Neither the alteration, amendment or repeal of this Article V,
nor the adoption of any other provision of this Certificate of Incorporation
inconsistent with this Article V, shall eliminate, reduce or otherwise affect
the effect of this Article V in respect of any matter occurring, or any cause of
action, suit or claim arising or accruing, or in respect of any matter that, but
for this Article V, would have arisen or accrued, prior to such alteration,
amendment, repeal or adoption.
(c) For purposes of this Article V, "Corporation" shall mean the
Corporation and all of its Affiliates other than Cadence, collectively, and any
successors thereto and assigns thereof; provided, however, that where, in order
to effectuate the intent of this definition to provide Cadence with protection
in its dealings with any such Affiliate, action on the part of any such
Affiliate of the Corporation is required (e.g., without limitation, to renounce
an interest in a transaction, potential transaction or other business
opportunity, or to adopt guidelines pursuant to Section 2 of this Article V),
the Corporation shall cause such Affiliate to take such action. For purposes of
this Article V, "Cadence" shall mean Cadence and all of its Affiliates (other
than the Corporation and its Subsidiaries), collectively, and any successors
thereto and assigns thereof.
(d) This Article V may be modified, amended or repealed only by the
affirmative vote of ninety percent (90%) of the outstanding voting stock of the
Corporation entitled to vote thereon.
(e) This Article V shall remain in effect only until such time as
(i) Cadence shall hold less than ten percent (10%) of the voting power of the
Corporation's outstanding securities entitled to vote in an election of
directors and (ii) no officer or employee of Cadence shall be a member of the
Board of Directors. After such time, this Article V shall have no further force
or effect.
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ARTICLE VI
MANAGEMENT OF THE AFFAIRS OF THE CORPORATION
SECTION 1. Board of Directors/Operating Company. The business and
affairs of the Corporation shall be managed by or under the direction of the
Board of Directors, which may exercise all the powers of the Corporation and do
all such lawful acts and things that are not conferred upon or reserved to the
stockholders by law, by this Certificate of Incorporation or the Bylaws. The
Corporation shall take no action inconsistent with the terms of the Partnership
Agreement.
SECTION 2. Additional Management Provisions. The following provisions
are inserted for the limitation and regulation of the powers of the Corporation
and of its directors and stockholders:
(a) Subject to the rights of the holders of any series of Preferred
Stock to elect additional directors under specified circumstances, the number of
directors shall be fixed from time to time exclusively by the Board of Directors
pursuant to a resolution adopted by a majority of the Whole Board. For purposes
of this Certificate of Incorporation, the term "Whole Board" shall mean the
total number of authorized directors whether or not there exist any vacancies in
previously authorized directorships. The directors, other than those who may be
elected by the holders of any series of Preferred Stock under specified
circumstances, shall be divided into three classes, with the term of office of
the first class to expire at the Corporation's first annual meeting of
stockholders, the term of office of the second class to expire at the
Corporation's second annual meeting of stockholders and the term of office of
the third class to expire at the Corporation's third annual meeting of
stockholders. At each annual meeting of stockholders, directors elected to
succeed those directors whose terms expire shall be elected for a term of office
to expire at the third succeeding annual meeting of stockholders after their
election.
(b) Subject to the rights of the holders of any series of Preferred
Stock then outstanding, from and after the date on which Cadence and its
Subsidiaries, acting together, cease to be entitled to cast a majority of the
votes on all matters submitted to a vote of stockholders of the Corporation,
newly created directorships resulting from any increase in the authorized number
of directors or any vacancies in the Board of Directors resulting from death,
resignation, retirement, disqualification, removal from office or other cause
shall, unless otherwise required by law or by resolution of the Board of
Directors, be filled only by a majority vote of the directors then in office,
though less than a quorum (and not by stockholders), and directors so chosen
shall hold office for a term expiring at the annual meeting of stockholders at
which the term of office of the class to which they have been chosen expires;
prior to such date, no decrease in the authorized number of directors shall
shorten the term of any incumbent director. Prior to such date, such vacancies
may also be filled by a majority vote of the stockholders.
(c) Advance notice of stockholder nominations for the election of
directors and of business to be brought by stockholders before any meeting of
the stockholders of the Corporation shall be given in the manner provided in the
Bylaws.
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(d) Subject to the rights of the holders of any series of Preferred
Stock then outstanding, from and after the date on which Cadence and its
Subsidiaries, acting together, cease to be entitled to cast a majority of the
votes on all matters submitted to a vote of the stockholders of the Corporation,
any director, or the entire Board of Directors, may be removed from office at
any time, but only for cause and only by the affirmative vote of the holders of
at least eighty percent (80%) of the voting power of all of the then outstanding
shares of capital stock of the Corporation entitled to vote in the election of
directors, voting together as a single class. Prior to such date, any director
may be removed with or without cause by a majority of votes entitled to be cast
at an election of directors.
(e) The Board of Directors is expressly empowered to adopt, amend or
repeal Bylaws. Any adoption, amendment or repeal of the Bylaws by the Board of
Directors shall require the approval of a majority of the Whole Board. The
stockholders shall also have the power to adopt, amend or repeal the Bylaws;
provided, however, that, in addition to any vote of the holders of any class or
series of stock of the Corporation required by law or by this Certificate of
Incorporation, the affirmative vote of the holders of at least sixty-six and
two-thirds percent (66 2/3%) of the voting power of all of the then-outstanding
shares of the capital stock of the Corporation entitled to vote generally in the
election of directors, voting together as a single class, shall be required to
adopt, amend or repeal any provision of the Bylaws.
(f) Special meetings of the stockholders of the Corporation for any
purpose or purposes may be called solely as set forth in the Bylaws.
(g) From and after the date on which Cadence and its Subsidiaries,
acting together, cease to be entitled to cast a majority of the votes on all
matters submitted to a vote of the stockholders of the Corporation, 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 stockholders of the
Corporation and may not be effected by any consent in writing by such
stockholders. Prior to such date, any such action may also be effected by
written consent of the stockholders.
ARTICLE VII
LIMITATIONS ON DIRECTOR 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 for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve 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. If the
DGCL is amended to authorize corporate action further eliminating or limiting
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 DGCL, as so amended.
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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 VIII
CORPORATE POWER
The Corporation reserves the right to amend or repeal any provision of
this Certificate of Incorporation in the manner prescribed by the laws of the
State of Delaware and all rights conferred upon stockholders are granted subject
to this reservation; provided, however, that, notwithstanding any other
provision of this Certificate of Incorporation or any provision of law that
might otherwise permit a lesser vote or no vote, but in addition to any vote of
the holders of any class or series of the stock of the Corporation required by
law or by this Certificate of Incorporation, the affirmative vote of the holders
of at least eighty percent (80%) of the voting power of all of the then
outstanding shares of the capital stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class, shall
be required to amend or repeal this Article VIII, Article VII or Section 2(a),
(b), (d), (e), (f) or (g) of Article VI; provided further, that any amendment of
this Certificate of Incorporation that would adversely affect the rights or
powers of the Class A Common Stock, increase the rights or powers of the Class B
Common Stock or Class C Common Stock set forth herein, or authorize the creation
of a new class of Common Stock shall require the affirmative vote of the holders
of a majority of the outstanding shares of Class A Common Stock not held by
Cadence or its Affiliates voting as a separate class.
ARTICLE IX
DEFINITIONS
For purposes of this Certificate of Incorporation:
(i) "Affiliate" shall mean as to any Person, any other Person
who controls, is controlled by, or is under common control with such Person.
(ii) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(iii) "Limited Partner Interests" shall mean limited partner
interests of the Partnership.
(iv) "Limited Partnership Unit" means the equal units into which
all the Limited Partner Interests (other than any Preferred Interests) are
divided.
(v) "Partnership" shall mean Tality, LP, a Delaware limited
partnership.
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(vi) "Partnership Agreement" shall mean the Agreement of Limited
Partnership of the Partnership, dated as of _______ ___, 2000, as may be amended
from time to time.
(vii) "Person" shall mean any individual, partnership, joint
venture, limited liability company, firm, corporation, trust or other entity,
including governmental authorities.
(viii) "Preferred Interests" shall have the meaning given to it
in the Partnership Agreement.
(ix) "Subsidiary" shall mean, with respect to any Person, any
other Person in which such first Person owns, directly or indirectly, more than
50% of the capital stock (or other voting interests) the holders of which are
generally entitled to vote for the election of the board of directors or other
governing body of such Person or otherwise controls such Person (whether by
contract or otherwise).
(x) "Tax-Free Spin-Off" shall mean a distribution of Common
Stock (and preferred stock, if any) or common stock (and preferred stock, if
any) of a Person that is a successor to the Corporation, in a Spin-Off Merger as
a spin-off, split-up or split-off to holders of common stock of Cadence intended
to qualify as a tax-free distribution under Section 355 of the Code, or any
successor thereto.
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THE UNDERSIGNED, being the officers hereinbefore named do make and file
this Amended and Restated Certificate of Incorporation.
Dated: September ___, 2000
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Robert P. Wiederhold, President
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Duane W. Bell, Secretary
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