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EXHIBIT 3.1
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS
OF SERIES A PREFERRED STOCK
of
BANCTEC, INC.
(Pursuant to Section 151 of the Delaware General Corporation Law)
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BANCTEC, INC., a corporation organized and existing under the laws of
the State of Delaware (the "Corporation"), hereby certifies that, pursuant to
authority vested in the Board of Directors of the Corporation by Article Fourth
of the Certificate of Incorporation of the Corporation, the following resolution
was adopted as of September 22, 2000 by the Board of Directors of the
Corporation pursuant to Section 141 of the Delaware General Corporation Law:
"RESOLVED that, pursuant to authority vested in the Board of Directors
of the Corporation by Article Fourth of the Corporation's Certificate of
Incorporation, of the total authorized number of 1,000,000 shares of
Preferred Stock, $.01 par value per share, of the Corporation, there shall
be designated a series of 100,000 shares which shall constitute a single
series to be known as "Series A Preferred Stock" (hereinafter called the
"Series A Preferred Stock"). The shares of Series A Preferred Stock shall
have the voting powers, designations, preferences and other special rights,
and qualifications, limitations and restrictions thereof set forth below:
Except as otherwise expressly provided herein, all shares of Series A
Preferred Stock (i) shall be identical and shall entitle the holders
thereof to the same rights and privileges, and (ii) shall, with respect to
dividend rights, redemption rights and rights on liquidation, winding up,
corporate reorganization and dissolution, rank senior to (A) the Common
Stock, $.01 par value per share, of the Corporation (the "Common Stock"),
(B) the Class A Common Stock, $.01 par value per share, of the Corporation
(the "Class A Common Stock") and (C) all classes and series of stock of the
Corporation now or hereafter authorized, issued or outstanding ranking pari
passu or junior to the Series A Preferred Stock (the "Junior Securities").
1. Dividends. (a) The holders of shares of Series A Preferred
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Stock shall be entitled to receive such dividends as from time to time may
be declared by the Board of Directors of the Corporation out of funds
legally available for such purpose, at the rate per annum of 7.0% of the
Redemption Price (as defined below) per share. Such dividends shall be
cumulative and shall accrue from and after the date of issue whether or
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not there are any funds of the Corporation legally available for the
payment of dividends. The Board of Directors of the Corporation may fix a
record date for the determination of holders of Series A Preferred Stock
entitled to receive payment of a dividend declared thereon, which record
date shall be no more than 60 days prior to the date fixed for the payment
thereof.
(b) As long as any shares of Series A Preferred Stock shall
remain outstanding, in no event (without the written consent of the holders
of 66-2/3% of the outstanding Series A Preferred Stock) shall any dividend
be declared or paid upon, nor shall any distribution be made upon, any
Common Stock or Junior Securities, other than a dividend or distribution
payable solely in shares of Common Stock of the Corporation, nor shall any
shares of Junior Securities be purchased or redeemed by the Corporation,
nor shall any monies be paid to or made available for a sinking fund for
the purchase or redemption of shares of any Junior Securities, unless, in
each such case, (i) full cumulative dividends on the outstanding shares of
Series A Preferred Stock shall have been declared and paid and (ii) any
arrears or defaults in any redemption of shares of Series A Preferred Stock
shall have been cured.
2. Redemption. The shares of Series A Preferred Stock shall be
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redeemable as follows:
2A. Mandatory Redemption. The Corporation shall redeem all of
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the outstanding shares of Series A Preferred Stock (i) on September 22,
2008 (the "Redemption Date"), (ii) upon a merger or consolidation of the
Corporation with or into another entity (other than a merger in which the
Corporation is the surviving corporation and which will not result in more
than 50% of the capital stock of the Corporation outstanding immediately
after the effective date of such merger being owned of record or
beneficially by persons other than the holders of such capital stock
immediately prior to such merger), (iii) upon the sale or other disposition
of all or substantially all of the assets or properties of the Corporation
or any of its subsidiaries, or of any division of the Corporation of any of
its subsidiaries, or (iv) upon the acquisition of "beneficial ownership" by
any "person" or "group" (other than Welsh, Carson, Anderson & Stowe VIII,
L.P. or its affiliates) of voting stock of the Corporation representing
more than 50% of the voting power of all outstanding shares of such voting
stock, whether by way of merger or consolidation or otherwise, in the
manner and with the effect provided in subparagraphs 2C through 2E below,
by paying for each share of Series A Preferred Stock the Redemption Price.
As used herein, (i) the terms "person" and "group" shall have the
meaning set forth in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), whether or not applicable, (ii) the
term "beneficial owner" shall have the meaning set forth in Rules 13d-3 and
13d-5 under the Exchange Act, whether or not applicable, except that a
person shall be deemed to have "beneficial ownership" of all shares that
any such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time or upon the occurrence of
certain events, and (iii) any "person" or "group" will be deemed to
beneficially own any voting stock of
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the Corporation so long as such person or group beneficially owns, directly
or indirectly, in the aggregate a majority of the voting stock of a
registered holder of the voting stock of the Corporation.
2B. Optional Redemption. The Corporation may, in its sole
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discretion, redeem at any time and from time to time (in the manner and
with the effect provided in subparagraphs 2C through 2E below), any whole
number of shares of Series A Preferred Stock. Any date on which the
Corporation elects to redeem shares of Series A Preferred Stock as provided
in this subparagraph 2B and each date on which the Corporation shall be
required to redeem shares of Series A Preferred Stock as provided in
subparagraph 2A above shall be referred to as a "Redemption Date."
2C. Redemption Price. The Series A Preferred Stock to be
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redeemed on a Redemption Date shall be redeemed by paying for each share
the sum of $150.00 (adjusted for any stock splits, stock dividends,
recapitalizations and the like with respect to such shares) plus the
aggregate amount of dividends accrued and unpaid thereon to such Redemption
Date whether or not such dividends shall have been declared by the Board of
Directors of the Corporation, such aggregate amount being herein sometimes
referred to as the "Redemption Price". Not less than 30 days before such
Redemption Date, written notice shall be given by mail, postage prepaid to
the holders of record of the Series A Preferred Stock to be redeemed, such
notice to be addressed to each such stockholder at such holder's post
office address as shown by the records of the Corporation, specifying the
number of shares to be redeemed, the paragraph or paragraphs of this
Certificate of Designation pursuant to which such redemption shall be made,
the Redemption Price and the place and date of such redemption, which date
shall not be a day on which banks in the City of New York are required or
authorized to close. If such notice of redemption shall have been duly
given and if on or before such Redemption Date the funds necessary for
redemption shall have been set aside so as to be and continue to be
available therefor, then, notwithstanding that any certificate for shares
of Series A Preferred Stock to be redeemed shall not have been surrendered
for cancellation, after the close of business on such Redemption Date, the
shares so called for redemption shall no longer be deemed outstanding, the
dividends thereon shall cease to accrue, and all rights with respect to
such shares shall forthwith after the close of business on the Redemption
Date, cease, except only the right of the holders thereof to receive, upon
presentation of the certificate representing shares so called for
redemption, the Redemption Price therefor, without interest thereon.
2D. Redeemed or Otherwise Acquired Shares to Be Retired. Any
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shares of the Series A Preferred Stock redeemed pursuant to this paragraph
2 or otherwise acquired by the Corporation in any manner whatsoever shall
be permanently retired and shall not under any circumstances be reissued;
and the Corporation may from time to time take such appropriate corporate
action as may be necessary to reduce the number of authorized shares of
Series A Preferred Stock accordingly.
2E. Notwithstanding anything herein to the contrary, any
redemption of shares of Series A Preferred Stock pursuant to clauses (ii),
(iii) or (iv) of subparagraph
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2A above is subject to the following: Any cash proceeds or other
consideration received by the Corporation or any subsidiary of the
Corporation, as the case may be, in connection with any of the transactions
described in such clauses shall be used by the Corporation to repay any and
all amounts owed by the Corporation pursuant to the terms and conditions of
the Credit Agreement, dated as of July 22, 1999, among the Corporation and
the other parties signatory thereto, prior to the Corporation's redemption
of any shares of Series A Preferred Stock pursuant to such clauses.
3. Liquidation. Upon any liquidation, dissolution or winding up
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of the Corporation, whether voluntary or involuntary, the holders of the
shares of Series A Preferred Stock shall be entitled, before any
distribution or payment is made upon any Junior Security to be paid an
amount equal to $150.00 per share (adjusted for any stock splits, stock
dividends, recapitalizations and the like with respect to such shares) plus
the amount of any accrued and unpaid dividends thereon through the date of
such payment (such amounts being herein sometimes referred to as the
"Liquidation Payments"). Upon such liquidation, dissolution or winding up
of the Corporation, after the holders of Series A Preferred Stock shall
have been paid in full the amounts to which they shall be entitled, the
remaining net assets of the Corporation may be distributed to the holders
of Junior Securities and Common Stock. If upon such liquidation,
dissolution or winding up of the Corporation, whether voluntary or
involuntary, the assets to be distributed among the holders of Series A
Preferred Stock of the Corporation shall be insufficient to permit payment
in full to the holders of Series A Preferred Stock of the Liquidation
Payments as aforesaid, then the entire assets of the Corporation to be
distributed shall be distributed ratably among the holders of Series A
Preferred Stock.
4. Voting. Except as otherwise provided by law, the Certificate
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of Incorporation of the Corporation and this Certificate of Designation,
the holders of Series A Preferred Stock shall not be entitled to vote on
any matters to be voted on by the stockholders of the Corporation.
5. Restrictions. At any time when shares of Series A Preferred
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Stock are outstanding, and in addition to any other vote of stockholders
required by law or by the Corporation's Certificate of Incorporation,
without the prior consent of the holders of 66-2/3% of the outstanding
Series A Preferred Stock, in each case given in person or by proxy, either
in writing or at a special meeting called for that purpose, at which
meeting the holders of the Series A Preferred Stock shall vote together as
a class, the Corporation will not:
(i) take any formal action by its Board of Directors or
stockholders (A) to consolidate or merge with or into any other entity
(other than a merger in which the Corporation is the surviving corporation
and which will not result in more than 50% of the capital stock of the
Corporation being owned of record or beneficially by persons other than the
holders of such capital stock immediately prior to such merger), (B) to
sell or otherwise dispose of all or substantially all of the properties or
assets of the Corporation as an entirety to any other person or (C) to
permit the acquisition by any "person" or "group" of "beneficial ownership"
of voting stock of such subsidiary
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representing more than 50% of the voting power of all outstanding shares of
such voting stock, whether by way of merger or consolidation or otherwise;
(ii) create, obligate itself to create, authorize or issue any
new class or classes of stock or new series of common stock or preferred
stock or any security convertible into or evidencing the right to purchase
shares of any new class or series of common stock or preferred stock or any
new capital stock of the Corporation having preference over or being on
parity with the Series A Preferred Stock in any respect; or
(iii) amend, alter or repeal the Corporation's Certificate of
Incorporation or By-laws in any manner;
(iv) declare, pay or set apart for payment any dividend or make
any distribution in respect of Junior Securities or any securities on
parity with the Series A Preferred Stock, except as permitted by paragraph
1(b) hereof;
(v) issue any Junior Securities of the Corporation, in either
case in excess of $5,000,000 in the aggregate; or
(vi) consummate a public offering of the Corporation's equity
securities.
IN WITNESS WHEREOF, this Certificate of Designations has been executed
by the Corporation as of this 22nd day of September, 2000.
BANCTEC, INC.
By /s/Richard A. McDonough
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Richard A. McDonough
Secretary
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