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EXHIBIT 3.1
SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
iSKY, INC.
Originally incorporated on May 20, 1999 under the name KASTAR SATELLITE
COMMUNICATIONS CORP.
iSky, Inc., a corporation organized and existing under the laws of the
State of Delaware (the "CORPORATION"), hereby certifies as follows:
1. The Corporation was originally incorporated under the name KaSTAR
Satellite Communications Corp.
2. The original Certificate of Incorporation of the Corporation was
filed with the Secretary of State of the State of Delaware on May 20, 1999.
3. The Corporation filed an Amended and Restated Certificate of
Incorporation reflecting the Corporation's name change to "iSKY.net, Inc." and
certain other amendments on October 19, 1999.
4. The Corporation filed a Certificate of Amendment to the Amended and
Restated Certificate of Incorporation reflecting the Corporation's name change
to "iSKY, Inc." on December 3, 1999.
5. This Second Amended and Restated Certificate of Incorporation amends
and restates the Amended and Restated Certificate of the Corporation, in its
entirety.
6. This Second Amended and Restated Certificate of Incorporation was
duly adopted in accordance with the provisions of Section 242 and 245 of the
General Corporation Law of the State of Delaware and has been consented to in
writing by the stockholders, and written notice has been given, in accordance
with Section 228 of the General Corporation Law of the State of Delaware.
7. This Second Amended and Restated Certificate of Incorporation shall
be effective upon filing with the Secretary of State of the State of Delaware.
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SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
iSKY, INC. ,
A DELAWARE CORPORATION
ARTICLE I
The name of the Corporation is iSky, Inc.
ARTICLE II
The address of the registered office of the Corporation in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle
County, Delaware 19801, and the name of the registered agent of the Corporation
in the State of Delaware at such address is The Corporation Trust Company.
ARTICLE III
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 the State of Delaware.
ARTICLE IV
A. The total number of shares of capital stock that the Corporation is
authorized to issue is Three Hundred Sixty Million Three Hundred Twenty Thousand
Two Hundred Eighteen (360,320,218). The Corporation is authorized to issue two
classes of shares to be designated respectively Preferred Stock ("PREFERRED
STOCK") and Common Stock ("COMMON STOCK"). The total number of shares of Common
Stock the Corporation shall have authority to issue is One Hundred Seventy Nine
Million Five Hundred Eighty Two Thousand Eight Hundred Twenty Five
(179,582,825). The total number of shares of Preferred Stock the Corporation
shall have authority to issue is One Hundred Eighty Million Seven Hundred Thirty
Seven Thousand Three Hundred Ninety Three (180,737,393). The Preferred Stock
shall have a par value of $.001 per share and the Common Stock shall have a par
value of $.001 per share.
B. PREFERRED STOCK
1. Shares of Preferred Stock authorized by this Second Amended
and Restated Certificate of Incorporation, as amended from time to time (this
"CERTIFICATE OF INCORPORATION"), may be issued from time to time in one or more
series. All shares of any one series of Preferred Stock shall be of equal rank
and identical in all respects except as to the dates from and after which
dividends thereon shall cumulate, if cumulative.
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2. The first series of Preferred Stock shall consist of One
Hundred Nine Million Four Hundred Ninety-Nine Thousand Eight Hundred Thirty-One
(109,499,831) shares and is designated "SERIES A PREFERRED STOCK." The second
series of Preferred Stock shall consist of Two Million Four Hundred Six Thousand
Nine Hundred Ninety-Five (2,406,995) shares and is designated "SERIES B
PREFERRED STOCK." The third series of Preferred Stock shall consist of
Twenty-Three Million Five Hundred Eighty-Seven Thousand Seven Hundred Thirty-One
(23,587,731) shares and is designated "SERIES C PREFERRED STOCK." The fourth
series of Preferred Stock shall consist of Fifteen Million Seven Hundred Twenty
Thousand One Hundred Eighty (15,720,180) shares and is designated "SERIES D
NONVOTING PREFERRED STOCK." The fifth series of Preferred Stock shall consist of
Fifteen Million Seven Hundred Twenty Thousand One Hundred Eighty (15,720,180)
shares and is designated "SERIES E PREFERRED STOCK." The sixth series of
Preferred Stock shall consist of Thirteen Million Eight Hundred Two Thousand
Four Hundred Seventy Six (13,802,476) shares and is designated "SERIES F
PREFERRED STOCK." The Series A Preferred Stock, the Series B Preferred Stock,
the Series C Preferred Stock, the Series E Preferred Stock and the Series F
Preferred Stock are referred to collectively herein as the "CONVERTIBLE VOTING
PREFERRED STOCK." The Series D Nonvoting Preferred Stock and the Convertible
Voting Preferred Stock are referred to collectively herein as the "CONVERTIBLE
PREFERRED STOCK."
C. The rights, preferences, privileges and restrictions granted to and
imposed on the Series A Preferred Stock, the Series B Preferred Stock, the
Series C Preferred Stock, the Series D Nonvoting Preferred Stock, the Series E
Preferred Stock and the Series F Preferred Stock are as set forth below in this
Article IV.C.
1. DIVIDEND PROVISIONS.
(a) The holders of shares of Convertible Preferred
Stock shall be entitled to receive dividends, out of any assets legally
available therefor, prior and in preference to any declaration or payment of any
dividend (payable other than in Common Stock or other securities and rights
convertible into or entitling the holder thereof to receive, directly or
indirectly, additional shares of Common Stock) on the Common Stock, at the rate
of $0.08 per share of Series A Preferred Stock, $0.168 per share of Series B
Preferred Stock, $0.28 per share of Series C Preferred Stock, $0.28 per share of
Series D Nonvoting Preferred Stock, $0.28 per share of Series E Preferred Stock
and $0.34 per share of Series F Preferred Stock (subject to appropriate
adjustments for stock splits, stock dividends, combinations or other
recapitalizations) per annum, payable out of funds legally available therefor.
Such dividends shall be payable only when, as and if declared by the Board of
Directors of the Corporation (the "BOARD OF DIRECTORS") and shall not be
cumulative.
(b) If the Corporation shall declare a distribution
payable in securities of other persons, evidences of indebtedness issued by the
Corporation or other persons, assets (excluding cash dividends) or options or
rights to purchase any such securities or evidences of indebtedness, then, in
each case the holders of the Convertible Preferred Stock shall be entitled to a
proportionate share of any such distribution as though the holders of the
Convertible Preferred Stock were the holders of the number of shares of Common
Stock into which their respective shares of Convertible Preferred Stock are
convertible as of the record date fixed for the determination of the holders of
Common Stock entitled to receive such distribution.
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2. LIQUIDATION PREFERENCE.
(a) Upon any liquidation, dissolution or winding up
of the Corporation, either voluntary or involuntary, each holder of the
Convertible Preferred Stock shall be entitled to receive prior and in preference
to any distribution of any of the assets of the Corporation to the holders of
Common Stock by reason of their ownership thereof, an amount per share equal to
$1.00 per share of Series A Preferred Stock (as adjusted for stock splits,
dividends, combinations or other recapitalizations with respect to such shares)
plus all declared and unpaid dividends on the Series A Preferred Stock, an
amount per share equal to $2.094 per share of Series B Preferred Stock (as
adjusted for stock splits, dividends, combinations or other recapitalizations
with respect to such shares) plus all declared and unpaid dividends on the
Series B Preferred Stock, an amount per share equal to $3.50 per share of Series
C Preferred Stock (as adjusted for stock splits, dividends, combinations or
other recapitalizations with respect to such shares) plus all declared and
unpaid dividends on the Series C Preferred Stock, an amount per share equal to
$3.50 per share of Series D Nonvoting Preferred Stock (as adjusted for stock
splits, dividends, combinations or other recapitalizations with respect to such
shares) plus all declared and unpaid dividends on the Series D Nonvoting
Preferred Stock, an amount per share equal to $3.50 per share of Series E
Preferred Stock (as adjusted for stock splits, dividends, combinations or other
recapitalizations with respect to such shares) plus all declared and unpaid
dividends on the Series E Preferred Stock, and an amount per share equal to
$4.25 per share of Series F Preferred Stock (as adjusted for stock splits,
dividends, combinations or other recapitalizations with respect to such shares)
plus all declared and unpaid dividends on the Series F Preferred Stock. If upon
the occurrence of such event, the assets and funds thus distributed among the
holders of the Convertible Preferred Stock shall be insufficient to permit the
payment to such holders of the full aforesaid preferential amounts, then, the
entire assets and funds of the Corporation legally available for distribution
shall be distributed ratably among the holders of the Convertible Preferred
Stock in proportion to the preferential amount each such holder would otherwise
be entitled to receive.
(b) After the distributions described in Article
IV.C.2(a) above, if any, have been paid, the remaining assets of the Corporation
available for distribution to stockholders shall be distributed among the
holders of Common Stock pro rata based on the number of shares of Common Stock
held by each.
(c) A consolidation or merger of the Corporation with
or into any other corporation, corporations or other entity (other than any
merger effected solely for the purpose of changing the domicile of the
Corporation) in which more than 50% of the voting power of the Corporation is
disposed of, or a sale, conveyance or disposition of all or substantially all of
the assets of the Corporation or the effectuation by the Corporation of a
transaction or series of related transactions in which more than 50% of the
voting power of the Corporation is disposed of, shall be deemed to be a
liquidation, dissolution or winding up within the meaning of this Article
IV.C.2.
(d) Whenever the distribution provided for in this
Article IV.C.2. shall be payable in securities or property other than cash, the
value of such distribution shall be the fair market value of such securities or
other property as determined in good faith by the Board of Directors.
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(e) The Corporation shall mail to each holder of
Convertible Preferred Stock written notice at least fifteen (15) days prior to
any liquidation, dissolution or winding up of the Corporation within the meaning
of this Article IV.C.2.
3. REDEMPTION. The Convertible Preferred Stock shall not be
redeemable by the Corporation.
4. VOTING RIGHTS; DIRECTORS.
(a) GENERAL VOTING RIGHTS. Except as set forth in
Article IV.C.4(b) below, the holder of each share of Convertible Voting
Preferred Stock shall have the right to one vote for each share of Common Stock
into which such Convertible Voting Preferred Stock could then be converted (with
any fractional share determined on an aggregate conversion basis being rounded
to the nearest whole share), and with respect to such vote, such holder shall
have full voting rights and powers equal to the voting rights and powers of the
holders of Common Stock, and shall be entitled, notwithstanding any provision
hereof, to notice of any stockholders' meeting in accordance with the Bylaws of
the Corporation (the "BYLAWS"), and shall be entitled to vote, together as a
single class with holders of Common Stock, with respect to any matter upon which
holders of Common Stock have the right to vote. Shares of Series D Nonvoting
Preferred Stock shall have no voting rights except as required by the General
Corporation Law of the State of Delaware.
(b) ELECTION OF DIRECTORS. The Board of Directors
shall consist of seven (7) members, unless otherwise changed in accordance with
Article IV.C.6.(a)(vii) hereof. The holders of Convertible Voting Preferred
Stock, voting together on an as-converted basis as a single class, shall be
entitled to elect all of the members of the Board of Directors (the
"DIRECTORS"). At any meeting held for the purpose of electing or nominating
directors, the presence in person or by proxy of the holders of a majority of
the Convertible Voting Preferred Stock then outstanding shall constitute a
quorum of the Convertible Voting Preferred Stock for the election or nomination
of the Directors.
5. CONVERSION. The holders of the Convertible Preferred Stock
shall have conversion rights as follows (the "CONVERSION RIGHTS"):
(a) RIGHT TO CONVERT. Each share of Convertible
Voting Preferred Stock shall be convertible, at the option of the holder
thereof, at any time, into such number of fully paid and nonassessable shares of
Common Stock as is determined by dividing $1.00, in the case of the Series A
Preferred Stock, $2.094, in the case of the Series B Preferred Stock, $3.50, in
the case of the Series C Preferred Stock and the Series E Preferred Stock, and
$4.25, in the case of the Series F Preferred Stock, by the Conversion Price
applicable to such share, determined as hereinafter provided, in effect on the
date the certificate is surrendered for conversion. The initial Series A
Conversion Price shall be $1.00 (the "SERIES A CONVERSION PRICE"), the initial
Series B Conversion Price shall be $2.094 (the "SERIES B CONVERSION PRICE"), the
initial Series C Conversion Price shall be $3.50 (the "SERIES C CONVERSION
PRICE"), the initial Series E Conversion Price shall be $3.50 (the "SERIES E
CONVERSION PRICE") and the initial Series F Conversion Price shall be $4.25 (the
"SERIES F CONVERSION PRICE"). Such initial Series A Conversion Price, Series B
Conversion Price, Series C Conversion Price, Series E Conversion Price and
Series F Conversion Price shall be adjusted as hereinafter provided.
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(b) AUTOMATIC CONVERSION. Each share of Convertible
Voting Preferred Stock shall automatically be converted into shares of Common
Stock at the then-effective Series A Conversion Price, the then-effective Series
B Conversion Price, the then-effective Series C Conversion Price, the
then-effective Series E Conversion Price or the then-effective Series F
Conversion Price, as the case may be, upon the earlier of (i) the date specified
by written consent or agreement of holders of at least fifty-eight percent (58%)
of the shares of the Convertible Voting Preferred Stock then outstanding, voting
together on an as-converted basis as a single class, or (ii) immediately prior
to the closing of the sale of Common Stock in a firm commitment, underwritten
public offering registered under the Securities Act of 1933, as amended (the
"SECURITIES ACT") other than a registration relating solely to a transaction
under Rule 145 under the Securities Act (or any successor thereto) or to an
employee benefit plan of the Corporation, at a public offering price (prior to
underwriters' discounts and expenses) equal to or exceeding $4.00 per share of
Common Stock (subject to appropriate adjustments for stock splits, stock
dividends, combinations or other recapitalizations) and the aggregate proceeds
to the Corporation and/or any selling stockholders (without deduction for
underwriters' discounts and expenses relating to the issuance) of which exceed
$15,000,000.
(c) CONVERSION OF SERIES D NONVOTING PREFERRED STOCK.
Upon the occurrence of the automatic conversion of the Corporation's Convertible
Voting Preferred Stock pursuant to Article IV.C.5(b), each share of Series D
Nonvoting Preferred Stock shall automatically be converted into the number of
shares of Common Stock into which each share of Series E Preferred Stock is
converted. Prior to the occurrence of the automatic conversion of the
Convertible Preferred Stock pursuant to Article IV.C.5(b), at the option of
either the holder or the Corporation and upon the occurrence of either of the
events specified in Article IV.C.5(c)(i) or (ii) below, each share of Series D
Nonvoting Preferred Stock shall be convertible into one share of Series E
Preferred Stock.
(i) the delivery to the Corporation by the
holder (or the delivery to the holder by the
Corporation) of (A) written confirmation of the
expiration of all waiting periods under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act") applicable to the
acquisition by such holder of voting stock of the
Corporation, or (B) a legal opinion of counsel to
such holder, addressed to the Corporation (or a legal
opinion of counsel to the Corporation, addressed to
such holder) confirming that the provisions of the
HSR Act do not apply to such holder's proposed
acquisition of voting stock; or
(ii) the receipt by the Corporation of
written notice (or other notice acceptable to the
Corporation) of the transfer of such Series D
Nonvoting Preferred Stock to any person or entity
whose ownership of voting stock of the Corporation
does not require any filing or waiting period
expiration under the HSR Act (or where such filing
and expiration have already occurred).
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(d) MECHANICS OF CONVERSION.
(i) Before any holder of Convertible Preferred Stock
shall be entitled to convert the same into shares of Common Stock (or Series E
Preferred Stock, if applicable), such holder shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation or of any
transfer agent for such stock, and shall give written notice to the Corporation
at such office that such holder elects to convert the same and shall state
therein the name or names in which such holder wishes the certificate or
certificates for shares of Common Stock (or Series E Preferred Stock, if
applicable) to be issued. The Corporation shall, as soon as practicable
thereafter, issue and deliver at such office to such holder of Convertible
Preferred Stock, a certificate or certificates for the number of shares of
Common Stock (or Series E Preferred Stock, if applicable) to which such holder
shall be entitled as aforesaid. Such conversion shall be deemed to have been
made immediately prior to the close of business on the date of surrender of the
shares of Convertible Preferred Stock to be converted, and the person or persons
entitled to receive the shares of Common Stock (or Series E Preferred Stock, if
applicable) issuable upon such conversion shall be treated for all purposes as
the record holder or holders of such shares of Common Stock (or Series E
Preferred Stock, if applicable) on such date.
(ii) If the conversion is in connection with an
underwritten offering of securities pursuant to the Securities Act, the
conversion may, at the option of any holder tendering shares of Convertible
Preferred Stock for conversion, be conditioned upon the closing with the
underwriters of the sale of securities pursuant to such offering, in which event
the person(s) entitled to receive the Common Stock upon conversion of the
Convertible Preferred Stock shall not be deemed to have converted such
Convertible Preferred Stock until immediately prior to the closing of such sale
of securities.
(e) ADJUSTMENTS OF PREFERRED STOCK. The Series A Conversion
Price, the Series B Conversion Price, the Series C Conversion Price, the Series
E Conversion Price and the Series F Conversion Price shall be subject to
adjustment from time to time as follows:
(i)(A) If the Corporation shall issue, after the date
upon which any shares of Convertible Voting Preferred Stock were first issued
(the "PURCHASE DATE" with respect to such series), any Additional Stock (as
defined below) without consideration or for a consideration per share less than
the Series A Conversion Price, the Series B Conversion Price, the Series C
Conversion Price, the Series E Conversion Price or the Series F Conversion
Price, as the case may be, in effect immediately prior to the issuance of such
Additional Stock, the Series A Conversion Price, the Series B Conversion Price,
the Series C Conversion Price, the Series E Conversion Price or the Series F
Conversion Price, as the case may be, in effect immediately prior to each such
issuance shall forthwith (except as otherwise provided in this clause (i)) be
adjusted to a price determined by multiplying such Series A Conversion Price,
Series B Conversion Price, Series C Conversion Price, Series E Conversion Price
or Series F Conversion Price, as the case may be, by a fraction, the numerator
of which shall be the number of shares of Common Stock outstanding immediately
prior to such issuance (including, without limitation, the number of shares of
Common Stock issuable upon the conversion of all of the outstanding shares of
Convertible Preferred Stock and other convertible securities and assuming the
exercise of all outstanding options, warrants or other rights to purchase Common
Stock or other securities convertible into Common Stock) plus the number of
shares of Common Stock that the aggregate consideration received by the
Corporation for such issuance would purchase at such Conversion
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Price; and the denominator of which shall be the number of shares of Common
Stock outstanding immediately prior to such issuance (including, without
limitation, the number of shares of Common Stock issuable upon the conversion of
all of the outstanding shares of Convertible Preferred Stock and other
convertible securities and assuming the exercise of all outstanding options,
warrants or other rights to purchase Common Stock or other securities
convertible into Common Stock) plus the number of shares of such Additional
Stock.
(B) No adjustment of the Series A Conversion Price,
the Series B Conversion Price, the Series C Conversion Price, the Series E
Conversion Price or the Series F Conversion Price shall be made in an amount
less than one cent ($0.01) per share, provided that any adjustments which are
not required to be made by reason of this sentence shall be carried forward and
shall be either taken into account in any subsequent adjustment made prior to
three (3) years from the date of the event giving rise to the adjustment being
carried forward, or shall be made at the end of three (3) years from the date of
the event giving rise to the adjustment being carried forward. Except to the
limited extent provided for in Article IV.C.5(e)(i)(E)(3) and Article
IV.C.5(e)(i)(E)(4), no adjustment of such Series A Conversion Price, Series B
Conversion Price, Series C Conversion Price, Series E Conversion Price or Series
F Conversion Price pursuant to this Article IV.C.5(e)(i) shall have the effect
of increasing the Series A Conversion Price, the Series B Conversion Price, the
Series C Conversion Price, the Series E Conversion Price or the Series F
Conversion Price above the Series A Conversion Price, the Series B Conversion
Price, the Series C Conversion Price, the Series E Conversion Price or the
Series F Conversion Price (as applicable) in effect immediately prior to such
adjustment.
(C) In the case of the issuance of Additional Stock
for cash, the consideration shall be deemed to be the amount of cash paid
therefor before deducting any reasonable discounts, commissions or other
expenses allowed, paid or incurred by the Corporation for any underwriting or
otherwise in connection with the issuance and sale thereof.
(D) In the case of the issuance of Additional Stock
for a consideration in whole or in part other than cash, the consideration other
than cash shall be deemed to be the fair value thereof as determined in good
faith by the Board of Directors irrespective of any accounting treatment.
(E) In the case of the issuance (whether on or after
the applicable Purchase Date) of options to purchase or rights to subscribe for
or acquire Common Stock, securities by their terms convertible into or
exchangeable for Common Stock or options to purchase or rights to subscribe for
or acquire such convertible or exchangeable securities, the following provisions
shall apply for all purposes of this Article IV.C.5(e)(i) and Article
IV.C.5(e)(ii):
(1) The aggregate maximum number of shares of Common
Stock deliverable upon exercise (assuming the satisfaction of any conditions to
exercisability, including without limitation, the passage of time, but without
taking into account potential antidilution adjustments) of such options to
purchase or rights to subscribe for or acquire Common Stock shall be deemed to
have been issued at the time such options or rights were issued and for a
consideration equal to the consideration (determined in the manner provided in
Article IV.C.5(e)(i)(C) and 5(e)(i)(D)), if any, received by the Corporation
upon the issuance of such
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options or rights plus the minimum exercise price provided in such options or
rights (without taking into account potential antidilution adjustments) for the
Common Stock covered thereby.
(2) The aggregate maximum number of shares of Common
Stock deliverable upon conversion of or in exchange for (assuming the
satisfaction of any conditions to convertibility or exchangeability, including,
without limitation, the passage of time, but without taking into account
potential antidilution adjustments) any such convertible or exchangeable
securities or upon the exercise of options to purchase or rights to subscribe
for or acquire such convertible or exchangeable securities and subsequent
conversion or exchange thereof shall be deemed to have been issued at the time
such securities were issued or such options or rights were issued and for a
consideration equal to the consideration, if any, received by the Corporation
for any such securities and related options or rights (excluding any cash
received on account of accrued interest or accrued dividends), plus the minimum
additional consideration, if any, to be received by the Corporation (without
taking into account potential antidilution adjustments) upon the conversion or
exchange of such securities or the exercise of any related options or rights
(the consideration in each case to be determined in the manner provided in
Article IV.C.5(e)(i)(C) and Article IV.C.5(e)(i)(D)) hereof.
(3) Upon any change in the number of shares of Common
Stock deliverable or in the consideration payable to the Corporation upon
exercise of such options or rights or upon conversion of or in exchange for such
convertible or exchangeable securities, including, but not limited to, a change
resulting from the antidilution provisions thereof, the Series A Conversion
Price, the Series B Conversion Price, the Series C Conversion Price, the Series
E Conversion Price or the Series F Conversion Price, to the extent in any way
affected by or computed using such options, rights or securities, shall be
recomputed to reflect such change.
(4) Upon the expiration of any such options or
rights, the termination of any such rights to convert or exchange or the
expiration of any options or rights related to such convertible or exchangeable
securities, the Series A Conversion Price, the Series B Conversion Price, the
Series C Conversion Price, the Series E Conversion Price or the Series F
Conversion Price, to the extent in any way affected by or computed using such
options, rights or securities or options or rights related to such securities,
shall be recomputed to reflect the issuance of only the number of shares of
Common Stock (and convertible or exchangeable securities which remain in effect)
actually issued upon the exercise of such options or rights, upon the conversion
or exchange of such securities or upon the exercise of the options or rights
related to such securities.
(5) The number of shares of Common Stock deemed
issued and the consideration deemed paid therefor pursuant to Article
IV.C.5(e)(i)(E)(1) and Article IV.C.5(e)(i)(E)(2) hereof shall be appropriately
adjusted to reflect any change, termination or expiration of the type described
in either Article IV.C.5(e)(i)(E)(3) or Article IV.C.5(e)(i)(E)(4) hereof.
(6) In the event of an adjustment to the Series A
Conversion Price, the Series B Conversion Price, the Series C Conversion Price,
the Series E Conversion Price or the Series F Conversion Price pursuant to
Article IV.C.5(e), no further adjustment shall be made for the actual issuance
of Common Stock upon the exercise of any such options or rights or the
conversion or exchange of such securities.
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(ii) "ADDITIONAL STOCK" shall mean any shares of
Common Stock issued (or deemed to have been issued pursuant to Article
IV.C.5(e)(i)(E)) by the Corporation after the Purchase Date other than:
(A) Common Stock issued pursuant to a transaction
described in Article IV.C.5(e)(iii) hereof; or
(B) (i) up to ten million (10,000,000) shares of
Common Stock (or options, warrants or other rights to purchase such Common
Stock) issued or issuable to employees, consultants, officers or directors of
the Corporation pursuant to a stock option plan or restricted stock plan
approved by the Board of Directors, whether issued or issuable before or after
the Purchase Date, net of any such shares of Common Stock repurchased by the
Corporation and any such options, warrants or other rights to purchase such
Common Stock that expire unexercised, and subject to adjustment for any stock
splits, dividends, combinations or recapitalizations with respect to such shares
and (ii) Common Stock or Preferred Stock (or options, warrants or other rights
to purchase Common Stock or Preferred Stock) issued or issuable to employees,
consultants, officers or directors of the Corporation pursuant to stock option
agreements in effect as of May 26, 1999 (including amendments thereto); or
(C) shares of Common Stock (or options, warrants or
other rights to purchase such Common Stock) issued or issuable in connection
with (i) debt financings, credit agreements or issuance of debt securities
(including the issuance of options, warrants or other rights to acquire
securities of the Corporation to underwriters in connection with the placement
of such debt securities), equipment leasing arrangements, or the sale by the
Corporation of capacity on a satellite owned or controlled by the Corporation,
in each case upon the express approval of the Board of Directors, whether issued
or issuable before or after the Purchase Date; or
(D) shares of Common Stock or Series E Preferred
Stock issued or issuable upon conversion of the Convertible Preferred Stock; or
(E) shares of Common Stock issued or issuable (I) in
a public offering before or in connection with which all outstanding shares of
Convertible Preferred Stock will be converted to Common Stock or (II) upon
exercise of warrants or rights granted to underwriters in connection with such a
public offering; or
(F) shares of Series B Preferred Stock to be issued
to KPCB Holdings, Inc., pursuant to that certain Series A and B Preferred Stock
Purchase Agreement, dated as of May 26, 1999, by and among the Company and the
parties signatory thereto; or
(G) shares of Series A Preferred Stock, Series B
Preferred Stock and Series C Preferred Stock issued to Liberty KASTR Corp.,
DirectCom Networks, Inc., Televerde Communications, L.P. and KPCB Holdings,
Inc., pursuant to that certain Securities Purchase Agreement, by and among the
Company and the parties signatory thereto; or
(H) Up to one million six hundred thousand shares of
Common Stock to be issued to each of DirectCom Networks, Inc. and KaStarCom.
World Satellite, LLC
<PAGE> 11
pursuant to that certain Securities Purchase Agreement between the Company,
DirectCom Networks, Inc., and KaStarCom. World Satellite; or
(I) Series D Preferred Stock, Series E Preferred
Stock and warrants to purchase Series F Preferred Stock (and the shares of
Series F Preferred Stock issuable upon exercise thereof) issued to Echostar
Satellite Communications (or an affiliate) and existing stockholders exercising
preemptive rights under the Company's Amended and Restated Investor Rights
Agreement; or
(J) Series C Preferred Stock issued to Telesat
Canada.
(iii) If the Corporation should at any time or from
time to time after the Purchase Date fix a record date for the effectuation of a
split or subdivision of the outstanding shares of Common Stock or the
determination of holders of Common Stock entitled to receive a dividend or other
distribution payable in additional shares of Common Stock or other securities or
rights convertible into, or entitling the holder thereof to receive directly or
indirectly, additional shares of Common Stock (hereinafter referred to as
"COMMON STOCK EQUIVALENTS") without payment of any consideration by such holder
for the additional shares of Common Stock or the Common Stock Equivalents
(including the additional shares of Common Stock issuable upon conversion or
exercise thereof), then, as of such record date (or the date of such dividend
distribution, split or subdivision if no record date is fixed), the Series A
Conversion Price, the Series B Conversion Price, the Series C Conversion Price,
the Series E Conversion Price and the Series F Conversion Price shall be
appropriately decreased so that the number of shares of Common Stock issuable on
conversion of each share of such series shall be increased in proportion to such
increase of the aggregate of shares of Common Stock outstanding and those
issuable with respect to such Common Stock Equivalents with the number of shares
issuable with respect to Common Stock Equivalents determined from time to time
in the manner provided for deemed issuances in Article IV.C.5(e)(i)(E) above.
(iv) If the number of shares of Common Stock
outstanding at any time after the Purchase Date is decreased by a combination of
the outstanding shares of Common Stock, then, following the record date of such
combination, the Series A Conversion Price, the Series B Conversion Price, the
Series C Conversion Price, the Series E Conversion Price and the Series F
Conversion Price shall be appropriately increased so that the number of shares
of Common Stock issuable on conversion of each share of such series shall be
decreased in proportion to such decrease in outstanding shares.
(f) OTHER DISTRIBUTIONS. If the Corporation shall
declare a distribution payable in securities of other persons, evidences of
indebtedness issued by the Corporation or other persons, assets (excluding cash
dividends) or options or rights not referred to in Article IV.C.5(e)(iii) above,
then, in each such case for the purpose of this Article IV.C.5(f), the holders
of the Convertible Preferred Stock shall be entitled to a proportionate share of
any such distribution as though they were the holders of the number of shares of
Common Stock of the Corporation into which their shares of Convertible Preferred
Stock are convertible as of the record date fixed for the determination of the
holders of Common Stock of the Corporation entitled to receive such
distribution.
<PAGE> 12
(g) RECAPITALIZATIONS. If at any time or from time to
time there shall be a recapitalization of the Common Stock (other than a
subdivision, combination or merger or sale of assets transaction provided for
elsewhere in this Article IV.C.5 or Article IV.C.2 hereof) provision shall be
made so that the holders of the Convertible Preferred Stock shall thereafter be
entitled to receive upon conversion of the Convertible Preferred Stock the
number of shares of stock or other securities or property of the Corporation or
otherwise, to which a holder of Common Stock deliverable upon conversion would
have been entitled on such recapitalization. In any such case, appropriate
adjustment shall be made in the application of the provisions of this Article
IV.C.5 with respect to the rights of the holders of the Convertible Preferred
Stock after the recapitalization to the end that the provisions of this Article
IV.C.5 (including adjustment of the Series A Conversion Price, the Series B
Conversion Price, the Series C Conversion Price, the Series E Conversion Price
and the Series F Conversion Price then in effect and the number of shares
purchasable upon conversion of the Convertible Preferred Stock) shall be
applicable after that event as nearly equivalent as may be practicable.
(h) NO IMPAIRMENT. The Corporation will not, by
amendment of its Certificate of Incorporation or through any reorganization,
recapitalization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Corporation, but will at all times in good faith assist in the
carrying out of all the provisions of this Article IV.C.5 and in the taking of
all such action as may be necessary or appropriate in order to protect the
Conversion Rights of the holders of the Convertible Preferred Stock against
impairment.
(i) NO FRACTIONAL SHARES AND CERTIFICATE AS TO
ADJUSTMENTS.
(i) No fractional shares shall be issued upon
conversion of the Convertible Preferred Stock to Common Stock, and the number of
shares of Common Stock to be issued shall be rounded to the nearest whole share.
Whether or not fractional shares are issuable upon such conversion shall be
determined on the basis of the total number of shares of Convertible Preferred
Stock the holder is at the time converting into Common Stock and the number of
shares of Common Stock issuable upon such aggregate conversion.
(ii) Upon the occurrence of each adjustment or
readjustment of the Series A Conversion Price, Series B Conversion Price, Series
C Conversion Price, Series E Conversion Price or Series F Conversion Price
pursuant to this Article IV.C.5, the Corporation, at its expense, shall promptly
compute such adjustment or readjustment in accordance with the terms hereof and
prepare and furnish to each holder of Convertible Preferred Stock a certificate
setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based. The Corporation shall, upon
the written request at any time of any holder of Convertible Preferred Stock,
furnish or cause to be furnished to such holder a like certificate setting forth
(A) such adjustment and readjustment, (B) the Series A Conversion Price, Series
B Conversion Price, Series C Conversion Price, Series E Conversion Price or
Series F Conversion Price at the time in effect, and (C) the number of shares of
Common Stock and the amount, if any, of other property which at the time would
be received upon the conversion of a share of Convertible Preferred Stock to
Common Stock.
<PAGE> 13
(j) NOTICES OF RECORD DATE. Upon the Corporation's
taking of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend (other
than a cash dividend) or other distribution, any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, the Corporation shall
mail to each holder of Convertible Preferred Stock, at least twenty (20) days
prior to the date specified therein, a notice specifying the date on which any
such record is to be taken for the purpose of such dividend, distribution or
right, and the amount and character of such dividend, distribution or right.
(k) RESERVATION OF STOCK ISSUABLE UPON CONVERSION.
The Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock and Series E Preferred Stock
solely for the purpose of effecting the conversion of the shares of Convertible
Preferred Stock such number of its shares of Common Stock and Series E Preferred
Stock as shall from time to time be sufficient to effect the conversion of all
outstanding shares of Convertible Preferred Stock; and if at any time the number
of authorized but unissued shares of Common Stock or Series E Preferred Stock
shall not be sufficient to effect the conversion of all then outstanding shares
of Convertible Preferred Stock, in addition to such other remedies as shall be
available to the holder of such Convertible Preferred Stock, the Corporation
will take such corporate action as may, in the opinion of its counsel, be
necessary to increase its authorized but unissued shares of Common Stock or
Series E Preferred Stock to such number of shares as shall be sufficient for
such purposes.
(l) NOTICES. Any notice required by the provisions of
this Article IV.C.5 to be given to the holders of shares of Convertible
Preferred Stock shall be deemed given when deposited in the United States mail,
postage prepaid, and addressed to each holder of record at his address appearing
on the books of the Corporation.
6. PROTECTIVE PROVISIONS.
(a) So long as any shares of Convertible Voting
Preferred Stock remain outstanding, the Corporation shall not, without the vote
or written consent by the holders of at least fifty-eight (58%) of the then
outstanding shares of Convertible Voting Preferred Stock, voting together as a
single class:
(i) sell, convey or otherwise dispose of or encumber
(other than pursuant to a credit arrangement in the ordinary course of business)
all or substantially all of its assets or business or merge into or consolidate
with any other entity (other than any merger effected solely for the purpose of
changing the domicile of the Corporation, any merger with a wholly-owned
subsidiary corporation or any merger in which the Corporation is the surviving
entity and no more than fifty percent (50%) of the voting power of the
Corporation is disposed of) or effect any transaction or series of related
transactions in which more than fifty percent (50%) of the voting power of the
Corporation is disposed of; or
(ii) provide for the voluntary liquidation,
dissolution or winding up of the Corporation; or
<PAGE> 14
(iii) amend the Certificate of Incorporation or
Bylaws in a manner that materially and adversely affects all of the holders of
the Convertible Voting Preferred Stock to the same extent; or
(iv) redeem any shares of the Corporation's capital
stock except for (A) the repurchase by the Corporation of shares of Common Stock
held by employees, officers, directors, consultants or other persons performing
services for the Corporation or any wholly-owned subsidiary that are subject to
restrictive stock purchase agreements under which the Corporation has the option
to repurchase such shares upon the occurrence of certain events, such as the
termination of employment or (B) the repurchase of shares of the Corporation's
Series D Nonvoting Preferred Stock pursuant to redemption rights granted to
certain holders of Series D Nonvoting Preferred Stock in connection with
limitations imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended, on such holder's ability to hold voting stock of the Corporation; or
(v) reclassify any shares of Common Stock to give
those shares a preference over, or to make those shares on a parity with, the
Convertible Voting Preferred Stock with respect to dividends, redemption or
voting rights or upon liquidation; or
(vi) declare any dividend or distribution on any
shares of Common Stock; or
(vii) change the number of directors from seven; or
(viii) authorize or issue any other equity securities
(other than Series E Preferred Stock issuable upon conversion of Series D
Nonvoting Preferred Stock), including any other security convertible into or
exercisable for any equity security, having a preference over, or being on
parity with each of the Convertible Voting Preferred Stock, including, without
limitation, with respect to dividends, redemption or voting rights or upon
liquidation; or
(ix) increase or decrease (other than by redemption
or conversion) the authorized number of shares of Convertible Preferred Stock.
(b) So long as any shares of Series A Preferred
Stock, Series B Preferred Stock, Series C Preferred Stock, Series E Preferred
Stock or Series F Preferred Stock (each a "SERIES OF VOTING PREFERRED STOCK")
remain outstanding, the Corporation shall not, without the vote or written
consent by the holders of at least fifty-eight percent (58%) of the then
outstanding shares of any such Series of Voting Preferred Stock, voting as a
single class:
(i) alter or change the rights, preferences or
privileges of the shares of such Series of Preferred Stock so as to affect
adversely the shares of such Series of Voting Preferred Stock in any manner that
does not so affect all Series of Voting Preferred Stock; or
<PAGE> 15
(ii) amend the Certificate of Incorporation or Bylaws
in a manner that materially and adversely affects the holders of such Series of
Voting Preferred Stock but does not so affect the shares of all Series of Voting
Preferred Stock; or
(iii) reclassify any shares of Common Stock to give
those shares a preference over, or to make those shares on a parity with, the
shares of such Series of Voting Preferred Stock with respect to dividends,
redemption or voting rights or upon liquidation but not the Shares of all Series
of Voting Preferred Stock; or
(iv) authorize or issue any other equity securities
(other than Series E Preferred Stock issuable upon conversion of Series D
Nonvoting Preferred Stock), including other any other security convertible into
or exercisable for any equity security, having a preference over, or being on
parity with, the shares of such Series of Voting Preferred Stock, including,
without limitation, with respect to dividends, redemption or voting rights or
upon liquidation but not the shares of all Series of Voting Preferred Stock; or
(v) increase or decrease (other than be redemption or
conversion) the authorized number of shares of such Series of Voting Preferred
Stock.
D. COMMON STOCK.
1. DIVIDEND RIGHTS. Subject to the prior rights of holders of
all classes of stock at the time outstanding having prior rights as to
dividends, the holders of the Common Stock shall be entitled to receive, when
and as declared by the Board of Directors, out of any assets of the Corporation
legally available therefor, such dividends as may be declared from time to time
by the Board of Directors.
2. LIQUIDATION RIGHTS. Upon the liquidation, dissolution or
winding up of the Corporation, the assets of the Corporation shall be
distributed as provided in Article IV.C.2. hereof.
3. VOTING RIGHTS. The holder of each share of Common Stock
shall have the right to one vote, and shall be entitled to notice of any
stockholders' meeting in accordance with the Bylaws, and shall be entitled to
vote upon such matters and in such manner as may be provided by law and by
Article IV.C.4(b) hereof.
ARTICLE V
A. EXCULPATION. 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 Delaware General
Corporation Law or (iv) for any transaction from which the director derived any
improper personal benefit. If the Delaware General Corporation Law is hereafter
amended to further reduce or to authorize, with
<PAGE> 16
the approval of the Corporation's stockholders, further reductions in the
liability of the Corporation's directors for breach of fiduciary duty, then a
director of the Corporation shall not be liable for any such breach to the
fullest extent permitted by the Delaware General Corporation Law as so amended.
B. INDEMNIFICATION. To the extent permitted by applicable law, the
Corporation is also authorized to provide indemnification of (and advancement of
expenses to) such agents (and any other persons to which Delaware law permits
the Corporation to provide indemnification) through bylaw provisions, agreements
with such agents or other persons, vote of stockholders or disinterested
directors or otherwise, in excess of the indemnification and advancement
otherwise permitted by Section 145 of the Delaware General Corporation Law,
subject only to limits created by applicable Delaware law (statutory or
non-statutory), with respect to actions for breach of duty to the Corporation,
its stockholders, and others.
C. EFFECT OF REPEAL OR MODIFICATION. Any repeal or modification of any
of the foregoing provisions of this Article V shall not adversely affect any
right or protection of a director, officer or agent of the Corporation (or any
other person to which Delaware law permits the Corporation to provide
indemnification) existing at the time of, or increase the liability of any
director, officer or agent of the Corporation (or other person) with respect to
any acts or omissions of such director, officer or agent (or other person)
occurring prior to, such repeal or modification.
ARTICLE VI
The Corporation shall have perpetual existence.
ARTICLE VII
Except as otherwise provided in this Certificate of Incorporation, in
furtherance and not in limitation of the powers conferred by statute, the Board
of Directors is expressly authorized to make, repeal, alter, amend and rescind
any or all of the Bylaws.
ARTICLE VIII
Elections of directors need not be by written ballot except and to the
extent provided in the Bylaws.
<PAGE> 17
ARTICLE IX
The Corporation reserves the right to amend, alter, change or repeal
any provision contained in this Certificate of Incorporation, in the manner now
or hereafter prescribed by statute, and all rights conferred upon stockholders
herein are granted subject to this reservation.
ARTICLE X
The Corporation shall not be subject to the provisions of Section 203
of the Delaware General Corporation Law.
<PAGE> 18
IN WITNESS WHEREOF, this Second Amended and Restated Certificate of
Incorporation has been signed as of this 13th day of March 2000.
iSKY, INC.
By: /s/ David M. Brown
-------------------------------
Name (Print): David M. Brown
---------------------
Title: Vice President
----------------------------
[SIGNATURE PAGE TO SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION]
<PAGE> 19
CERTIFICATE OF AMENDMENT
TO THE
SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
iSKY, INC.
iSKY, INC., a corporation duly organized and existing under the General
Corporation Law of the State of Delaware, (the "Corporation") does hereby
certify that:
1. The amendment to the Corporation's Certificate of Incorporation (the
"Certificate") set forth below was duly adopted in accordance with the
provisions of Section 242 and has been consented to in writing by the
stockholders, and written notice has been given, in accordance with Section 228
of the General Corporation law of the State of Delaware.
2. Article IV, Subsection A, of the Certificate shall be amended and
restated in its entirety to read as follows:
A. The total number of shares of capital stock that the
Corporation is authorized to issue is Four Hundred Twenty-Two
Million Nine Hundred Thirty-Five Thousand Four Hundred
Eighty-Nine (422,935,485). The Corporation is authorized to
issue two classes of shares to be designated respectively
Preferred Stock ("PREFERRED STOCK") and Common Stock ("COMMON
STOCK"). The total number of shares of Common Stock the
Corporation shall have authority to issue is Two Hundred
Eleven Million Five Hundred Eighty-Seven Thousand Six Hundred
Nine (211,587,609). The total number of shares of Preferred
Stock the Corporation shall have authority to issue is Two
Hundred Eleven Million Three Hundred Forty-Seven Thousand
Eight Hundred Seventy-Six (211,347,876). The Preferred Stock
shall have a par value of $.001 per share and the Common Stock
shall have a par value of $.001 per share.
3. Article IV, Subsection B(2), of the Certificate shall be amended and
restated in its entirety to read as follows:
2. The first series of Preferred Stock shall consist of One
Hundred Five Million Nine Hundred Seventy-Eight Thousand Five
Hundred Eleven (105,978,511) shares and is designated "SERIES
A PREFERRED STOCK." The second series of Preferred Stock shall
consist of Two Million Four Hundred Six Thousand Nine Hundred
Ninety-Five (2,406,995) shares and is designated "SERIES B
PREFERRED STOCK." The third series of Preferred Stock shall
consist of Thirty Million Nine Hundred Sixty-Three Thousand
Thirty (30,963,030) shares and is designated "SERIES C
PREFERRED STOCK." The fourth series of Preferred Stock shall
consist of Fourteen Million Two Hundred Eighty-Five Thousand
Seven
Page 1 of 2
<PAGE> 20
Hundred Fourteen (14,285,714) shares and is designated
"SERIES D PREFERRED STOCK." The fifth series of Preferred
Stock shall consist of Thirty-Five Million Five Hundred
Seventy-Two Thousand Nine Hundred Seventy-Six (35,572,976)
shares and is designated "SERIES E PREFERRED STOCK." The sixth
series of Preferred Stock shall consist of Twenty-Two Million
One Hundred Forty Thousand Six Hundred Fifty (22,140,650)
shares and is designated "SERIES F PREFERRED STOCK."
IN WITNESS WHEREOF, iSKY, Inc. has caused this Certificate of Amendment
to be executed by its authorized officer on this 9th day of May, 2000.
iSKY, INC.
By: /s/ David M. Brown
----------------------
David M. Brown, Secretary
Page 2 of 2
<PAGE> 21
CERTIFICATE OF AMENDMENT
OF THE
SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
iSKY, INC.
iSKY, Inc., a corporation duly organized and existing under the General
Corporation law of the State of Delaware (the "Corporation") does hereby certify
that:
1. The amendment to the Corporation's Second Amended and Restated
Certificate of Incorporation (the "Certificate") set forth below was duly
adopted in accordance with the provisions of Section 242 and has been consented
to in writing by the stockholders, and written notice has been given, in
accordance with Section 228 of the General Corporation law of the State of
Delaware.
2. Article I of the Certificate is amended and restated in its entirety
to read as follows:
"The name of the Corporation is Wildblue Communications, Inc."
3. This Amendment to the Second Amended and Restated Certificate of
Incorporation shall become effective as of August 15, 2000.
IN WITNESS WHEREOF, iSKY, Inc. has caused this Certificate of Amendment
to be executed by its authorized officer, on this 8th day of August, 2000.
iSKY, Inc.
By: /s/ David M. Brown
-------------------
David M. Brown
Secretary
