Amended Articles Of Incorporation

ARTICLES OF INCORPORATION OF NETZEE, INC.


ARTICLE I.


The name of the Corporation is Netzee, Inc.


ARTICLE II.


The purpose of the Corporation is to engage in any lawful act or Business Corporation Code (the "GBCC").


ARTICLE III.


The total number of shares of stock that the Corporation is authorized to issue is Seventy-Five Million (75,000,000) shares, of which and Five Million(5,000,000) shares are Preferred Stock (the "Preferred Stock"), all of which shares are without par value. The designations, preferences, limitations and relative rights of or on the Common Stock and the Preferred Stock are as set forth below and are otherwise subject to applicable law. The Common Stock (a) shall be one and the same class, (b) subject to the rights of the holders of Preferred Stock, if any, shall have full and unlimited voting rights (with each share having one vote on each matter submitted to shareholders for vote), and(c) subject to the rights of the holders of Preferred Stock, if any, shall have equal rights of participation in dividends and distributions and shall been titled to receive the net assets of the Corporation ratably upon the voluntary or involuntary liquidation, dissolution or winding up of the Corporation. The Board of Directors is authorized, by causing appropriate articles of amendment to be filed pursuant to the applicable law of the State of Georgia, to divide the Preferred Stock into series and to determine the preferences, limitations and relative rights thereof, including but not limited to dividend rights, dividend rates, conversion rights, voting rights (including, without limitation, the election of a specified number of directors by the holders of one or more such series), redemption rights, and liquidation preferences; to fix the number of shares constituting any such series and the designation thereof; and to increase or decrease the number of shares of any such series (but not below the number of shares thereof then issued).


ARTICLE IV.


The street address of the initial registered office of the Corporation is 3150 Holcomb Bridge Road, Suite 310, Norcross, Gwinnett County, Georgia 30071,and the initial registered agent of the Corporation at such address is C.Michael Bowers.


ARTICLE V.


The name and address of the incorporator are:


Mark D. Wasserman
Sutherland Asbill & Brennan LLP
999 Peachtree Street, N.E., Suite 2300
Atlanta, Georgia 30309-3996


ARTICLE VI. 2


The mailing address of the Corporation's initial principal office will be:


3150 Holcomb Bridge Road, Suite 310
Norcross, Georgia 30071


ARTICLE VII.


In furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to adopt, amend or repeal the Bylaws of the Corporation.


ARTICLE VIII.


A director of the Corporation shall not be personally liable to the Corporation or to its shareholders for monetary damages for any action taken, or any failure to take any action, as a director, except liability: (a) for any appropriation, in violation of his or her duties, of any business opportunity of the Corporation, (b) for acts or omissions that involve intentional misconductor a knowing violation of law, (c) for the types of liability set forth in Section 14-2-832 of the GBCC, or (d) for any transaction from which the director received an improper personal benefit. If the GBCC is hereafter amended to further eliminate or limit 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 GBCC, as so amended, without further action by the shareholders. Any repeal or modification of this Article VIII shall not adversely affect the elimination or limitation of liability or alleged liability pursuant hereto of a director of the Corporation for or with respect to any alleged act or omission of the director occurring prior to such repeal or modification.


ARTICLE IX.


The Board of Directors shall consist of such number of directors as fixed or changed from time to time by the Board of Directors and shall be divided into three classes: Class I, Class II and Class III, which shall be as nearly equal in number as possible. Each director shall serve for a term ending on the date of the third annual meeting of shareholders following the annual meeting at which such director was elected; provided, however, that each initial director in Class I shall hold office until the first annual meeting of shareholders after his election; each initial 2 director in Class II shall hold office until the second annual meeting of shareholders after his election; and each initial director in Class III shall hold office until the third annual meeting of shareholders after his election. Despite the expiration of a director's term, each director shall serve until his successor is elected and qualified or until his earlier death, resignation or removal. The number of directors may be increased or decreased from time to time by resolution of the Board of Directors; provided, however, that the total number of directors at any time shall not be less than three unless these Articles of Incorporation are amended to delete the classification of the Board of Directors. Any vacancies in the Board of Directors for any reason, and any directorships resulting from any increase in the authorized number of directors, may be filled by the Board of Directors, acting by a majority of the directors then in office, although less than a quorum, and any directors chosen to fill a vacancy shall hold office until the next election of the class for which such directors shall have been chosen and until their successors shall be elected and qualified, and any directors chosen by reason of an increase in the number 3


of directors shall hold office until the next election of directors by the shareholders and until their successors shall be elected and qualified. Subject to the foregoing and the GBCC, at each annual meeting of shareholders the successors to the class of directors whose term shall then expire shall be elected to hold office for a term expiring at the third succeeding annual meeting.


ARTICLE X.


In discharging the duties of their respective positions and in determining what is believed to be in the best interests of the Corporation, the Board of Directors, committees of the Board of Directors and individual directors, in addition to considering the effects of any action on the Corporation or its shareholders, may consider the interests of the employees, customers, suppliers and creditors of the Corporation and its subsidiaries, the communities in which offices or other establishments of the Corporation and its subsidiaries are located, and all other factors such directors consider pertinent; provided, however, that this Article X shall be deemed solely to grant discretionary authority to the directors and shall not be deemed to provide any constituency any right to be considered.


ARTICLE XI.


The shareholders of the Corporation shall have the right to take action in lieu of a meeting only by one or more consents in writing signed by all of the shareholders entitled to vote on such action.


ARTICLE XII.


Any shares of the Corporation reacquired by the Corporation shall become treasury shares.


ARTICLE XIII.


The affirmative vote of at least 66 2/3% of the directors is required for the following actions by the Corporation to be submitted to a vote of the shareholders:


(a) a sale of all or substantially all of the assets of the Corporation;


(b) a liquidation or dissolution of the Corporation; or


(c) the merger, consolidation or reorganization of the Corporation, unless the shareholders of the Corporation immediately prior to such transaction own at least a majority of the combined voting power of the corporation resulting from such merger, consolidation or reorganization;


provided, further, that the affirmative vote of the holders of 66 2/3% of the outstanding Common Stock is required for shareholder approval of any action outlined in the clauses above.


ARTICLE XIV.


The undersigned incorporator does hereby undertake to publish a notice of the filing with the Secretary of State of the State of Georgia of these Articles of Incorporation as required by O.C.G.A. (S) 14-2-201.1(b).


DULY EXECUTED and delivered by the undersigned incorporator on August 25, 1999.-- 4


/s/ Mark Wasserman
-------------------
Mark D. Wasserman, as Incorporator


* * * * *
4 5


ARTICLES OF AMENDMENT
OF
NETZEE, INC.


I.


The name of the Corporation, which was incorporated under the Georgia Business Corporation Code, is Netzee, Inc.


II.


The first amendment adopted is to delete Article XIII of the Articles of Incorporation of the Corporation in its entirety.


III.


The second amendment adopted is to amend Article XI of the Articles of Incorporation of the Corporation by deleting the text of Article XI in its entirety and substituting therefor the following text:


"The shareholders of the Corporation shall have the right to take
action without a meeting by one or more consents in writing signed by
persons entitled to vote at a meeting shares having voting power to
cast not less than the minimum number (or numbers, in the case of
voting by groups) of votes that would be necessary to authorize or
take the action at a meeting at which all shareholders entitled to
vote were present and voted."


IV.


Such amendment was adopted by the sole incorporator on September 1, 1999.


V.


No shares of the Corporation having been issued, the amendments were adopted by the sole incorporator without shareholder action, which action was not required pursuant to O.C.G.A. (S) 14-2-1005.


DULY EXECUTED and delivered by the sole incorporator on September 1, 1999.


/s/ Mark Wasserman
------------------------------
Mark D. Wasserman, Esq.
As Incorporator 6


ARTICLES OF AMENDMENT TO
ARTICLES OF INCORPORATION OF
NETZEE, INC.


In accordance with Sections 14-2-602 and 14-2-1006 of the Georgia Business Corporation Code (the "Code"), Netzee, Inc. (the "Corporation"), a corporation organized and existing under and by virtue of the Code, DOES HEREBY CERTIFY:


1. The name of the Corporation is Netzee, Inc.


2. The following resolution setting forth an amendment to the
Corporation's Articles of Incorporation has been duly adopted
by the Board of Directors:


RESOLVED, THAT ARTICLE III OF THE CORPORATION'S
ARTICLES OF INCORPORATION IS HEREBY AMENDED BY ADDING THE
FOLLOWING PROVISIONS TO THE END THEREOF: "THE CORPORATION IS
AUTHORIZED TO ISSUE 500,000 SHARES OF SERIES A 8% CONVERTIBLE
PREFERRED STOCK, WITHOUT PAR VALUE PER SHARE (THE "SERIES A
PREFERRED STOCK"). THE SERIES A PREFERRED STOCK SHALL HAVE
THE PREFERENCES, LIMITATIONS AND RELATIVE RIGHTS SET FORTH ON
EXHIBIT A HERETO."


3. The "Exhibit A" referenced in the foregoing resolution is
included in these Articles of Amendment and is the same
"Exhibit A" as is attached hereto.


4. The foregoing resolution containing the amendment was duly
adopted on December 14, 1999, by the Corporation's Board of
Directors in accordance with the provisions of Sections
14-2-602 and 14-2-1002 of the Code. This amendment was
adopted by the Corporation's Board of Directors without
shareholder action and such shareholder action was not
required. 7


IN WITNESS WHEREOF, the Corporation has caused this Amendment to be signed by the undersigned duly authorized officer, this 15th day of December, 1999.


NETZEE, INC.


By: /s/ Richard S. Eiswirth
---------------------------------


Name (print): Richard S. Eiswirth
------------------------


Title: CFO and EVP
-------------------------------


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EXHIBIT A


DESIGNATIONS OF PREFERENCES,
LIMITATIONS, AND RELATIVE RIGHTS OF
SERIES A PREFERRED STOCK OF NETZEE, INC.


For the purposes of these Designations, the following terms shall have the meanings specified:


"Articles of Incorporation" shall mean the Articles of Incorporation of the Corporation, as amended.


"Board of Directors" shall mean the board of directors of the Corporation.


"Bylaws" shall mean the bylaws of the Corporation, as amended.


"Common Stock" shall mean the common stock, no par value per share, of the Corporation.


"Conversion Notice" shall have the meaning provided in Subsection (d)(3) hereof.


"Conversion Price" shall have the meaning provided in Subsection (d)(1) hereof.


"Conversion Rate" shall have the meaning provided in Subsection (d)(1) hereof.


"Conversion Rights" shall have the meaning provided in Section (d) hereof.


"Conversion Shares" shall mean the shares of Common Stock into which each share of Series A Preferred Stock is convertible pursuant to Section (d) of these Designations.


"Corporation" shall mean Netzee, Inc., a Georgia corporation.


"Designations" shall mean the terms, preferences, limitations and relative rights of the Series A Preferred Stock established hereby and set forth hereinafter.


"Liquidation" shall have the meaning provided in Section (b) hereof.


"Redemption Notice" shall have the meaning provided in Subsection (d)(6) hereof. 9


"Redemption Price" shall have the meaning provided in Subsection (d)(6) hereof.


"Series A Preferred Stock" shall mean the 500,000 shares of Series A 8% Convertible Preferred Stock, without par value per share, hereby designated.


"Original Issue Date" shall mean, with respect to each share of Series A Preferred Stock, the date on which such share of Series A Preferred Stock is first issued by the Corporation.


"Securities Act" shall mean the federal Securities Act of 1933, as amended.


"Stated Value" per share of the Series A Preferred Stock shall mean the per share issue price for any share of Series A Preferred Stock (as adjusted pursuant to Section (d)(5) hereof after the Original Issue Date). The initial Stated Value per share of Series A Preferred Stock is $13.00.


The Designations granted to and imposed upon the Series A Preferred Stock are as follows:


(a) Dividend Rights. The following dividend rights shall apply to the Series A Preferred Stock:


(1) The holders of then outstanding shares of Series A
Preferred Stock shall be entitled to receive cumulative cash dividends
when, as and if declared by the Board of Directors out of any funds
legally available therefor at the rate of eight percent (8%) per
annum, or $1.04 per share of Series A Preferred Stock based upon the
initial Stated Value per share.


(2) Dividends shall accrue on each share of Series A
Preferred Stock from the Original Issue Date, and shall accrue from
day to day, whether or not earned or declared and whether or not there
shall be funds legally available for the payment of such dividends.
Such dividends shall be cumulative so that, if such dividends in
respect of any previous or current quarterly dividend period, at the
rate specified above, shall not have been paid or declared and a sum
sufficient for the payment thereof set apart, the deficiency shall
first be fully paid before any dividend or other distribution shall be
paid on or declared and set apart for the Common Stock or any other
stock ranking junior to the Series A Preferred Stock. Any accumulation
of dividends on the Series A Preferred Stock shall not bear interest.


(3) Unless full dividends on the Series A Preferred Stock
for all past dividend periods and the then current dividend period
shall have been paid or declared and a sum sufficient for the payment
above set apart, no cash dividend


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shall be paid or declared on Common Stock or any or any other stock
ranking junior to the Series A Preferred Stock as to liquidation
preference.


(4) Each dividend shall be paid to the holders of record of
the Series A Preferred Stock as they shall appear on the stock
register of the Corporation on such record date, not exceeding 45 days
nor less than 10 days preceding a dividend payment date, as shall be
fixed by the Board of Directors or a duly authorized committee
thereof.


(b) Liquidation Rights. Subject to the rights of any class of stock of the Corporation senior to the Series A Preferred Stock, in the event of the liquidation, dissolution or winding up for any reason, including, without limitation, bankruptcy, of the Corporation or any of the Corporation's subsidiaries, the assets of which constitute all or substantially all the assets of the business of the Corporation and its subsidiaries taken as a whole (each such event referred to as a "Liquidation"), the holders of the outstanding shares of Series A Preferred Stock shall, at their election, be entitled to receive in exchange for and in redemption of each share of their Series A Preferred Stock, and on a parity with the holders of any capital stock ranking pari passu to the Series A Preferred Stock by reason of their ownership thereof, from any funds or assets legally available for distribution to shareholders, that portion of such funds, proceeds or assets in an amount equal to a fraction,


(1) the numerator of which is the number of Conversion
Shares to which the holder of such share of Series A Preferred Stock
would be entitled by virtue of converting such share; and


(2) the denominator of which is the aggregate of the number
of Conversion Shares, shares of Common Stock outstanding, and all
other shares of outstanding capital stock of any series the holders of
which are entitled to participate in the proceeds of a Liquidation;


provided, however, that, notwithstanding the foregoing, the amount payable to such holder of a share of Series A Preferred Stock in the event of a Liquidation shall not be less than, and shall be increased if necessary (with sums payable to holders of shares of any other capital stock junior to be the Series A Preferred Stock to be reduced ratably per share as necessary) to equal, the Stated Value plus declared but unpaid dividends payable with respect to such Series A Preferred Stock.


All the preferential amounts to be paid to the holders of Series A Preferred Stock under this Section (b) shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any assets of the Corporation to, the holders of shares of Common Stock or any class or series of stock of the Corporation ranking junior to Series A Preferred Stock in connection with a Liquidation as to which this Section (b) applies. If the assets or surplus funds to be distributed to the holders of Series A Preferred Stock are insufficient to permit the


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payment to such holders of the full amounts payable to such holders, the assets and surplus funds legally available for distribution shall be distributed ratably among the holders of Series A Preferred Stock in proportion to the full amount each such holder is otherwise entitled to receive.


(c) Voting Rights. The Series A Preferred Stock shall be non-voting.


(d) Conversion. The holders of Series A Preferred Stock shall have conversion rights as follows (the "Conversion Rights"):


(1) Conversion Rate.


(A) For purposes of this Section (d), the shares of
Series A Preferred Stock shall be convertible, at the times
and under the conditions described in this Section (d)
hereafter, at the rate (the "Conversion Rate") of one share
of Series A Preferred Stock to the number of shares of Common
Stock that equals the quotient obtained by dividing the
Stated Value by the Conversion Price (defined hereinafter).
Thus, the aggregate number of shares of Common Stock to which
a holder of Series A Preferred Stock shall be entitled upon
any conversion provided for in this Section (d) shall be the
product obtained by multiplying the Conversion Rate by the
number of shares of Series A Preferred Stock being converted.
Such conversion shall be deemed to have been made immediately
prior to the close of business on the date of the surrender
of the shares of Series A Preferred Stock to be converted in
accordance with the procedures described in Subsection (d)(4)
below. The "Conversion Price" shall equal 110% of the closing
price per share of the Common Stock on the Original Issue
Date as reported on the Nasdaq National Market, except as
otherwise adjusted as provided hereafter in this Section (d).


(B) No fractional shares of Common Stock shall be
issued upon conversion of Series A Preferred Stock, and any
shares of Series A Preferred Stock surrendered for conversion
that would otherwise result in a fractional share of Common
Stock shall be redeemed in cash at the then effective
Conversion Price per share, payable as promptly as possible
when funds are legally available therefor.


(2) Optional Conversion. Subject to Subsection (d)(3)
below, each share of Series A Preferred Stock shall be convertible, at
the option of the holder thereof, at any time after issuance, in whole
or in part, at the office of the Corporation or any transfer agent for
the Series A Preferred Stock, into Common Stock at the then effective
Conversion Rate; provided, however, that the Corporation shall not be
obligated to issue certificates evidencing the shares of Common Stock
issuable upon such conversion unless certificates evidencing


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such shares of Series A Preferred Stock so converted are surrendered
to the Corporation in accordance with the procedures described in
Subsection (d)(3) below.


(3) Mechanics of Conversion. Before any holder of Series A
Preferred Stock shall be entitled to receive certificates representing
the shares of Common Stock into which shares of Series A Preferred
Stock are converted in accordance with Subsection (d)(2) above, such
holder shall surrender the certificate or certificates for such shares
of Series A Preferred Stock, duly endorsed, at the office of the
Corporation or of any transfer agent for the Series A Preferred Stock,
and shall give written notice to the Corporation at such office of the
name or names in which such holder wishes the certificate or
certificates for shares of Common Stock to be issued, if different
from the name shown on the books and records of the Corporation (the
"Conversion Notice"). The Conversion Notice shall also contain such
representations as may reasonably be required by the Corporation to
the effect that the shares to be received upon conversion are not
being acquired and will not be transferred in any way that might
violate the then applicable securities laws. The Corporation shall, as
soon as practicable thereafter and in no event later than thirty (30)
days after the delivery of said certificates and Conversion Notice,
issue and deliver at such office to such holder of Series A Preferred
Stock, or to the nominee or nominees of such holder as provided in the
Conversion Notice, a certificate or certificates for the number of
shares of Common Stock to which such holder shall be entitled as
aforesaid. The conversion shall be effective at the time the
Corporation accepts the Conversion Notice as being proper in form and
substance. The person or persons entitled to receive the shares of
Common Stock issuable upon a conversion pursuant to Subsection (d)(2)
above shall be treated for all purposes as the record holder or
holders of such shares of Common Stock as of the effective date of
conversion pursuant to this Section (d). All certificates issued upon
the exercise or occurrence of the conversion shall contain a legend
governing restrictions upon such shares ...