<PAGE> 1
EXHIBIT 3.1
CERTIFICATE OF INCORPORATION
OF
DIRECT ALLIANCE CORPORATION
ARTICLE I
NAME
The name of the Corporation is Direct Alliance Corporation.
ARTICLE II
REGISTERED OFFICE
The name and address of the registered office and registered agent of
the Corporation is The Corporation Trust Company, Corporation Trust Center, 1209
Orange Street, Wilmington, New Castle County, Delaware.
ARTICLE III
PURPOSE
The purpose for which this Corporation is organized is the transaction
of any or all lawful activity for which corporations may be organized under the
General Corporation Law of Delaware, as it may be amended from time to time
("DGCL").
ARTICLE IV
CAPITAL STOCK
Section 1. Number of Shares. The total number of shares of stock which
the Corporation shall have authority to issue is 110,000,000 shares, consisting
of 100,000,000 shares of common stock having a par value of $.01 per share (the
"Common Stock") and 10,000,000 shares of preferred stock having a par value of
$.01 per share (the "Preferred Stock").
The Board of Directors, or any authorized committee thereof, is
authorized from time to time to establish and designate, subject to limitations
prescribed by law and the provisions of this Article IV, one or more series of
Preferred Stock, and by filing a certificate pursuant to the applicable law of
the State of Delaware, to establish from time to time the number of shares to be
included in each such series, and to fix the designation, powers, preferences
and rights of the shares of each such series and the qualifications, limitations
or restrictions thereof.
Section 2. General. The designations, powers, preferences and rights
of, and the qualifications, limitations and restrictions upon, each class or
series of stock shall be determined in accordance with, or as set forth in,
Sections 3 and 4 of this Article IV.
1
<PAGE> 2
Section 3. Common Stock. Subject to all of the rights, powers and
preferences of the Preferred Stock, and except as provided by law or in this
Article IV (or in any certificate of designation of any series of Preferred
Stock) or by the Board of Directors or any authorized committee thereof pursuant
to this Article IV:
(a) the holders of the Common Stock shall have the exclusive
right to vote for the election of directors and on all other matters requiring
stockholder action, each share being entitled to one vote;
(b) dividends may be declared and paid or set apart for
payment upon the Common Stock out of any assets or funds of the Corporation
legally available for the payment of dividends, but only when and as declared by
the Board of Directors or any authorized committee thereof; and
(c) upon voluntary or involuntary liquidation, dissolution or
winding up of the Corporation, the net assets of the Corporation shall be
distributed pro rata to the holders of the Common Stock in accordance with their
respective rights and interests.
Section 4. Preferred Stock. The authority of the Board with respect to
each series shall include, but not be limited to, determination of the
following:
(a) The number of shares constituting that series and the
distinctive designation of that series;
(b) The dividend rate on the shares of that series, whether
dividends shall be cumulative, and, if so, from which date or dates, and the
relative rights of priority, if any, of payment of dividends on shares of that
series;
(c) Whether that series shall have voting rights, in addition
to the voting rights provided by law, and, if so, the terms of such voting
rights;
(d) Whether that series shall have conversion privileges, and,
if so, the terms and conditions of such conversion, including provision for
adjustment of the conversion rate in such events as the Board of Directors shall
determine;
(e) Whether or not the shares of that series shall be
redeemable, and, if so, the terms and conditions of such redemption, including
the date or dates upon or after which they shall be redeemable, and the amount
per share payable in case of redemption, which amount may vary under different
conditions and at different redemption dates;
(f) Whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and, if so, the terms and
amount of such sinking fund;
(g) The rights of the shares of that series in the event of
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, and the relative rights of priority, if any, of payment of shares
of that series; and
2
<PAGE> 3
(h) Any other relative rights, preferences and limitations of
that series.
3
<PAGE> 4
ARTICLE V
STOCKHOLDER ACTION
A resolution in writing, signed by the stockholders, representing all
of those shares entitled to vote shall be deemed to be the action of the
stockholders to the effect therein expressed with the same force and effect as
if the same had been duly passed by the same vote at a duly convened meeting.
Notwithstanding the preceding sentence, from the date on which Insight no longer
owns at least 50% of the Common Stock 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 the stockholders and may not be
effected by any consent in writing by such stockholders.
ARTICLE VI
DIRECTORS
Section 1. General. The business and affairs of the Corporation shall
be managed by or under the direction of the Board of Directors except as
otherwise provided herein or required by law.
Section 2. Election of Directors. Elections of directors at an annual
or special meeting of stockholders shall be by written ballot unless the Bylaws
of the Corporation shall otherwise provide. Advance notice of stockholder
nominations for the election of directors shall be given in the manner provided
in the Bylaws of the Corporation.
Section 3. Number and Terms of Directors. The number of directors of
the Corporation shall consist of not less than three directors nor more than
nine directors, the exact number to be fixed from time to time by resolution
duly adopted by the Board of Directors. The directors shall be divided into
three classes, designated Class I, Class II and Class III. Each class shall
consist, as nearly as may be possible, of one-third of the total number of
directors constituting the entire Board of Directors. The terms of the initial
Class I directors shall terminate on the date of the 2001 annual meeting of
stockholders; the terms of the initial Class II directors shall terminate on the
date of the 2002 annual meeting of stockholders; and the terms of the initial
Class III directors shall terminate on the date of the 2003 annual meeting of
stockholders. At each annual meeting of stockholders beginning in 2001,
successors to the class of directors whose term expires at that annual meeting
shall be elected by the Board of Directors for a three-year term by the Board of
Directors. If the number of directors is changed, any increase or decrease shall
be apportioned among the classes so as to maintain the number of directors in
each class as nearly equal as possible, and any additional directors of any
class elected to fill a vacancy resulting from an increase in such class shall
hold office for a term that shall coincide with the remaining terms of that
class, but in no case will a decrease in the number of directors shorten the
term of any incumbent director. A director shall hold office until the annual
meeting for the year in which his term expires and until his successor shall be
elected and shall qualify, subject, however, to prior death, resignation,
retirement, disqualification or removal from office.
Section 4. Initial Directors. The initial board of directors shall
consist of three directors. The names of the individuals who are to serve as
directors are:
Branson ("Tony") M. Smith - Class I Director
Timothy A. Crown - Class II Director
Eric J. Crown - Class III Director
Section 5. Vacancies. Subject to the rights, if any, of the holders of
shares of Preferred Stock then outstanding, any vacancy on the Board of
Directors that results from an increase in
4
<PAGE> 5
the number of directors may be filled by a majority of the whole Board of
Directors, and any other vacancy however occurring, including, without
limitation, by death, resignation, disqualification or removal of a director,
may be filled by a majority of the directors then in office, even if less than a
quorum, or by a sole remaining director. Any director elected to fill a vacancy
shall hold office for a term that shall coincide with the term of the class to
which such director shall have been elected and until such director's successor
shall have been duly elected and qualified or until his earlier death,
disqualification, resignation or removal.
Notwithstanding the foregoing, whenever the holders of any one or more
classes or series of Preferred Stock issued by the Corporation shall have the
right, voting separately by class or series, to elect directors at an annual or
special meeting of stockholders, the election, term of office, filling of
vacancies and other features of such directorships shall be governed by the
terms of this Certificate of Incorporation or the resolution or resolutions
adopted by the Board of Directors pursuant to Article IV applicable thereto, and
such directors so elected shall not be divided into classes pursuant to this
Article VI unless expressly provided by such terms.
During any period when the holders of any series of Preferred Stock
have the right to elect additional directors as provided for or fixed pursuant
to the provisions of Article IV hereof, then upon commencement and for the
duration of the period during which such right continues: (a) the then otherwise
total authorized number of directors of the Corporation shall automatically be
increased by such specified number of directors, and the holders of such
Preferred Stock shall be entitled to elect the additional directors so provided
for or fixed pursuant to said provisions, and (b) each such additional director
shall serve until such director's successor shall have been duly elected and
qualified, or until such director's right to hold such office terminates
pursuant to said provisions, whichever occurs earlier, subject to such
director's earlier death, disqualification, resignation or removal. Except as
otherwise provided by the Board in the resolution or resolutions establishing
such series, whenever the holders of any series of Preferred Stock having such
right to elect additional directors are divested of such right pursuant to the
provisions of such stock, the terms of office of all such additional directors
elected by the holders of such stock, or elected to fill any vacancies resulting
from the death, resignation, disqualification or removal of such additional
directors, shall forthwith terminate and the total and authorized number of
directors of the Corporation shall be reduced accordingly.
Section 6. Removal of Directors. Subject to the rights, if any, of the
holders of shares of Preferred Stock then outstanding, any or all of the
directors of the Corporation (including persons elected by directors to fill
vacancies on the 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 a majority of
the outstanding shares of the Corporation then entitled to vote generally in the
election of directors, considered for purposes of this Section 5 as one class.
At least 30 days prior to any meeting of stockholders at which it is proposed
that any director be removed from office, written notice of such proposed
removal shall be sent to the director whose removal will be considered at the
meeting. For purposes of this Certificate of Incorporation, "cause," with
respect to the removal of any director shall mean only (i) conviction of a
felony, (ii) declaration of unsound mind by order of court, (iii) gross
dereliction of duty, (iv) commission of any action involving moral turpitude, or
(v) commission of an action which constitutes intentional misconduct or a
knowing violation of law if such action in either event results both in an
improper substantial
5
<PAGE> 6
personal benefit and a material injury to the Corporation.
ARTICLE VII
SPECIAL MEETINGS
Special meetings of the stockholders of the Corporation for any purpose
or purposes may be called at any time only by the Chairman of the Board, the
Chief Executive Officer, or the Board of Directors pursuant to a resolution
approved by a majority of the whole Board of Directors, or at the request in
writing of stockholders owning a majority or more in amount of the capital stock
issued and outstanding and entitled to vote. Special meetings of the
stockholders may not be called by any other person or persons. Business
transacted at any special meeting of the stockholders shall be limited to the
purposes stated in the notice of such meeting.
ARTICLE VIII
SPECIAL VOTING REQUIREMENT
Section 1. Voting Requirement. Except as set forth in Sections 2 and 3
of this Article VIII, the affirmative vote of the holders of two-thirds of each
class of the outstanding stock of the Corporation entitled to vote shall be
required for:
(l) any merger or consolidation to which the Corporation, or
any of its subsidiaries, and an Interested Person (as hereinafter defined) are
parties;
(2) any sale or other disposition by the Corporation, or any
of its subsidiaries, of all or substantially all of its assets to an Interested
Person;
(3) any purchase or other acquisition by the Corporation, or
any of its subsidiaries, of all or substantially all of the assets or stock of
an Interested Person; and
(4) any other transaction with an Interested Person which
requires the approval of the stockholders of the Corporation under the DGCL, as
in effect from time to time.
Section 2. Board Approval. The provisions of Section 1 of this Article
VIII shall not be applicable to any transaction described therein if such
transaction is approved by resolution of the Corporation's Board of Directors,
provided that a majority of the members of the Board of Directors voting for the
approval of such transaction are Continuing Directors. The term "Continuing
Director" shall mean any member of the Board of Directors of the Corporation who
is not the Interested Person, and not an affiliate, associate, representative or
nominee of the Interested Person or of such an affiliate or associate, that is
involved in the relevant transaction, and (A) was a member of the Board of
Directors on December , 2000, (B) was a member of the Board of Directors prior
to the date that the person, firm or corporation, or any group thereof, with
whom such transaction is proposed, became an Interested Person, or (C) whose
initial election as a director of the Corporation succeeds a Continuing Director
or is a newly created directorship, and in either case was recommended, elected
or appointed by a majority vote of the Continuing Directors then in office.
6
<PAGE> 7
Section 3. Insight. The provisions of Section 1 of this Article VIII
shall be effective only from and after the date on which Insight Enterprises,
Inc. ceases to own at least 50% of the outstanding Common Stock of the
Corporation.
Section 4. Interested Persons. As used in this Article VIII, the term
"Interested Person" shall mean any person, firm or corporation, or any group
thereof, acting or intending to act in concert, including any person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such person, firm or corporation or group, which owns of record or
beneficially, directly or indirectly, five percent (5%) or more of any class of
voting securities of the Corporation.
ARTICLE IX
LIMITATION OF LIABILITY
No director of the Corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for any breach of fiduciary
duty by such a director as a director. Notwithstanding the foregoing sentence, a
director shall be liable to the extent provided by applicable law (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) pursuant to Section 174 of the
DGCL, or (iv) for any transaction from which such director derived an improper
personal benefit. No amendment to or repeal of this Article IX shall apply to or
have an effect on the liability or alleged liability of any director of the
Corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal. If the DGCL is amended after the
effective date of this Certificate of Incorporation to authorize 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.
ARTICLE X
BYLAWS
Section 1. Amendment by Directors. In furtherance and not in limitation
of the powers conferred by statute, the Board of Directors is expressly
authorized by majority vote of the whole Board of Directors to adopt, repeal,
alter, amend or rescind the Bylaws of the Corporation.
Section 2. Amendment by Stockholders. The Bylaws of the Corporation may
be adopted, repealed, altered, amended, or rescinded by the affirmative vote of
two-thirds of the outstanding stock of the Corporation entitled to vote thereon;
provided, if the Continuing Directors, as defined in Article VIII, shall by a
two-thirds favorable vote of such Continuing Directors have adopted a resolution
approving the amendment or repeal proposal and have determined to recommend it
for approval by the holders of stock entitled to vote thereon, then the vote
required shall be the affirmative vote of the holders of at least a majority of
the outstanding shares entitled to vote thereon.
7
<PAGE> 8
ARTICLE XI
CERTIFICATE OF INCORPORATION
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 the Certificate of Incorporation, and all
rights conferred on stockholders herein are granted subject to the reservations
in this Article XI; provided, however, the affirmative vote of the holders of at
least two-thirds of the voting power of the outstanding stock of the Corporation
entitled to vote thereon shall be required to alter, amend, or adopt any
provision inconsistent with or repeal Articles V, VI, VII, VIII, IX, X, XI, and
any Sections in such Articles; provided, if the Continuing Directors, as defined
in Article VIII, shall by a two-thirds favorable vote of such Continuing
Directors have adopted a resolution approving the amendment or repeal proposal
and have determined to recommend it for approval by the holders of stock
entitled to vote thereon, then the vote required shall be the affirmative vote
of the holders of at least a majority of the outstanding shares entitled to vote
thereon.
I, THE UNDERSIGNED, being the Incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the DGCL, do make this
Certificate, hereby declaring and certifying that this is my act and deed and
the facts herein stated are true, and accordingly have hereunto set my hand
this 21st day of December, 2000.
----------------------------------------
----------------, Sole Incorporator
8
