[image_005.jpg] 

 

Apollo Investment Corporation

9 W. 57th Street, 37th Floor

New York, New York 10019

 

September 20, 2013

 

Miller Energy Resources, Inc.

9721 Cogdill Road, Suite 302

Knoxville, TN 37932

Attention:    Scott M. Boruff

Chief Executive Officer

 

Re: Revised and Restated Consent and Amendment No. 7 (this “Amendment”)

 

Ladies and Gentlemen:

 

We refer to that certain Loan Agreement dated as of June 29, 2012 (as heretofore
amended or otherwise modified, the “Loan Agreement”), by and among Miller Energy
Resources, Inc., a Tennessee corporation (the “Borrower”), the financial
institutions party thereto from time to time as Lenders and Apollo Investment
Corporation, as Administrative Agent for the Lenders (in such capacity, the
“Administrative Agent”). Capitalized terms used but not otherwise defined herein
shall have the meanings given such terms in the Loan Agreement, as amended
hereby. References herein to any Section shall be to a Section of the Loan
Agreement, as amended hereby, unless otherwise specifically provided.

 

The Borrower has informed the Administrative Agent that it wishes to make
certain amendments to the Loan Agreement, and the Administrative Agent and the
Lenders have agreed, subject to the terms and conditions contained in this
Amendment, to make such amendments. These amendments include (i) permitting the
designation and issuance of a new series of preferred stock by the Borrower, as
described in the attached Exhibit A (the “Series D Preferred Stock”) and (ii)
amending the definition of “Permitted Lien” to account for the rescheduling of
the arbitration between Borrower and Voorhees Equipment and Consulting, Inc.,
now expected to occur on or about January 7, 2014.

 

In connection with this, Borrower, the Administrative Agent and the Lenders
previously agreed to a Consent and Amendment No. 7, dated September 20, 2013
(“Original Amendment No. 7”). Later on that same day, Borrower requested
adjustments, to which Administrative Agent and the Lenders have agreed. By this
Amendment, the parties intend to replace Original Amendment No. 7, in its
entirety, with this Amendment.

 

Accordingly, the Borrower, the Administrative Agent and the Lenders (or at least
the required percentage thereof) hereby agree as follows:

 

 

 

 

1. Effect of Original Amendment No. 7. Original Amendment No. 7 is hereby
replaced in its entirety with the terms of this Amendment. No consents,
amendments, modifications, waivers or agreements contained in Original Amendment
No. 7 shall have any force or effect, or shall operate to amend any of the terms
of the Loan Agreement, except to the extent such consent, amendment,
modification, waiver or agreement is separately and expressly set forth in this
Amendment. For the avoidance of doubt, and without limitation, no amendment to
clause (g) of Section 6.17 shall have occurred as a result of Original Amendment
No. 7, which shall remain in the form they existed immediately prior to the
execution of that Original Amendment No. 7.

 

2. Consent to Amendment of Borrower’s Articles of Incorporation. Borrower’s
filing of the amendment to its articles of incorporation substantially in the
form attached hereto as “Exhibit A” shall not be deemed to be “materially
adverse” to the Administrative Agent or the Lenders for purposes of Section
7.19(c) of the Loan Agreement, as amended hereby.

 

3. Treatment of the Series D Preferred Stock. The Series D Preferred Stock shall
not constitute Disqualified Stock for purposes of the Loan Agreement, as amended
hereby, solely as a result of the Series D Preferred Stock being redeemable
within thirty (30) days after Security Termination; provided that the foregoing
acknowledgement shall not in any way limit, modify or waive the restrictions set
forth in Section 7.10, as amended hereby. All proceeds from the issuance of
Series D Preferred Stock (other than amounts on deposit in the Special Dividend
Account) shall constitute Excluded Equity Proceeds and shall be used solely for
the purposes permitted by the Loan Agreement, as amended hereby. In addition,
and for the avoidance of doubt, it is further agreed that the Series D Preferred
Stock shall not be treated as Indebtedness for the purposes of the Loan
Agreement, as amended hereby, in the event it shall be classified as debt,
temporary equity or mezzanine equity for accounting purposes.

 

4. Amendments to Loan Agreement. On and as of the date hereof, the Loan
Agreement is amended as specified below.

 

(a) Amendments to Definitions.

 

(1) New Defined Terms. The following new defined terms are added to Section 1.1,
in the appropriate alphabetical order:

 

 

“‘Series D Preferred Dividend’ means a 10.5% per annum for cash payment paid
quarterly, subject to prior payment in full of accrued but unpaid dividends on
any other senior securities, if any, that may be issued with dividend rights
senior to the Series D Preferred Stock.”

 

“‘Series D Preferred Stock’ means the class of equity of the Borrower to be
designated “10.5% Series D Cumulative Redeemable Preferred Stock”, provided that
no more than 4,000,000 shares of such Stock shall be authorized or outstanding
at any time.”

 

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(2) Amendments to Existing Definitions. The following existing defined terms in
the Loan Agreement are hereby amended as follows:

 

(A) “Consolidated Permitted Expenses”. In the definition of “Consolidated
Permitted Expenses,” clause (n) is hereby replaced with the following:

 

“(n) only to the extent (i) permitted under Section 7.10 and (ii) no funds
remain on deposit in the Special Dividend Account, payment of the Series B
Preferred Dividend, Series C Preferred Dividend, and Series D Preferred
Dividend.”

 

(B) “Permitted Liens” In the definition of “Permitted Liens,” clause (r) is
hereby replaced with the following:

 

“(r) those certain Liens claimed by Voorhees Equipment and Consulting, Inc.
filed of record on (i) November 20, 2012 with the Anchorage Recording District
under file number 2012 68296-0 and (ii) November 15, 2012, in the Anchorage
Recording District, Alaska, File No. 2012 066917-0; provided that, (x) the value
of the asserted claims secured by those certain Liens shall, in the aggregate,
not exceed $728,230.00 and (y) the Liens permitted under this clause (r) shall
cease to be “Permitted Liens” on the earlier of March 31, 2014, or the thirtieth
(30th) day after the arbitrator issues an award in the arbitration expected to
begin on or about January 7, 2014 regarding the dispute between the Borrower and
Voorhees Equipment and Consulting, Inc. which gave rise to these liens.”

 

(b) Amendment to Section 7.10. Clause (e) of Section 7.10 is hereby replaced
with the following:

 

“(e) payments of the Series B Preferred Dividend, the Series C Preferred
Dividend or the Series D Preferred Dividend so long as immediately prior to and
after giving effect to each such payment, no Default or Event of Default shall
have occurred and be continuing and either:

 

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(i) such payment is made from Excluded Equity Proceeds so long as such use of
Excluded Equity Proceeds is permitted in accordance with Section 7.24; or

 

(ii) each such payment is made during a Capital Covenant Compliance Period and
immediately after giving effect to each such payment, the Borrower is in pro
forma compliance with the Capital Covenants; or”

 

(c) Amendment to Section 7.29. Section 7.29 is hereby replaced, in its entirety,
with the following:

 

“7.29    Series B Preferred Stock, Series C Preferred Stock, and Series D
Preferred Stock.

 

(a)    Borrower covenants and agrees that it shall not redeem any of the Series
B Preferred Stock, Series C Preferred Stock, or Series D Preferred Stock prior
to the date that is 30 days after the date on which Security Termination occurs.
The foregoing covenant and agreement shall survive the termination of the Loan
Documents and repayment of the Obligations.

 

(b)    Borrower shall not amend or otherwise modify the terms and/or conditions
of the Series B Preferred Stock, the Series C Preferred Stock, or the Series D
Preferred Stock (including without limitation the Series B Preferred Dividend,
the Series C Preferred Dividend, or the Series D Preferred Dividend) without the
prior written consent of the Administrative Agent.”

 

5. Ratification, Reaffirmation and Representations of Loan Parties. By its
signature below, each Loan Party hereby (a) acknowledges and agrees that, except
as expressly provided herein, the Loan Agreement, as amended hereby, and each of
the other Loan Documents are hereby ratified and confirmed in all respects and
shall remain in full force and effect; (b) ratifies and reaffirms its
obligations under, and acknowledges, renews and extends its continued liability
under, the Loan Agreement, as amended hereby, and each other Loan Document to
which it is a party; (c) ratifies and reaffirms all of the Liens securing the
payment and performance of the Obligations; and (d) represents and warrants to
the Administrative Agent and the Lenders that, as of the date hereof, (i) after
giving effect to this Amendment, all of the representations and warranties
contained in the Loan Agreement, as amended hereby, and each other Loan Document
to which it is a party are true and correct in all material respects, except to
the extent any such representations and warranties are expressly limited to an
earlier date, in which case, such representations and warranties shall continue
to be true and correct in all material respects as of such specified earlier
date, (ii) after giving effect to this Amendment, no Default or Event of Default
has occurred and is continuing, and (iii) the execution, delivery, and
performance of this Amendment by such Loan Party have been duly authorized by
all necessary action on the part of such Loan Party. This Amendment shall be
deemed to constitute a Loan Document for all purposes and in all respects. From
and after the date hereof, all references to the Loan Agreement and the Loan
Documents shall mean such Loan Agreement and such Loan Documents as amended by
this Amendment. By its signature below, each Loan Party agrees that, except as
expressly set forth herein, nothing herein shall be construed as (a) an
amendment, alteration, modification, waiver or continuing waiver of the
provisions of the Loan Agreement or any other Loan Document or (b) a waiver of
any Default or Event of Default now existing or hereafter arising under the Loan
Agreement or any other Loan Document. Nothing contained herein shall obligate
the Lenders to (i) grant any additional or future consents, amendments or
waivers under any provision of the Loan Agreement or any other Loan Document or
(ii) waive any Default or Event of Default now existing or hereafter arising
under the Loan Agreement or any other Loan Document.

 

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6. Conditions to Effectiveness. This Amendment shall become effective as of the
date first written above (the “Effective Date”) when and only when the
Administrative Agent shall have received duly executed counterparts of this
Amendment signed by each Loan Party and the Lenders (or at least the required
percentage thereof).

 

7. No Changes to Governing Documents. Borrower represents and warrants to the
Administrative Agent and the Lenders that the resolutions and Governing
Documents certified to the Administrative Agent and the Lenders by Borrower on
June 29, 2012, remain in full force and effect and have not been amended or
otherwise modified, except for the changes to its Charter designating the Series
B Preferred Stock and Series C Preferred Stock and Series D Preferred Stock. By
its respective signature below, each of the Loan Parties (other than the
Borrower) represents and warrants to the Administrative Agent and the Lenders
that its respective resolutions and Governing Documents certified to the
Administrative Agent and the Lenders by such Loan Party on June 29, 2012 remain
in full force and effect and have not been amended or otherwise modified.

 

8. Governing Law. This Amendment shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York.

 

9. Miscellaneous. In the event that any one or more of the provisions contained
in this Amendment shall for any reason be held invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision of this Amendment. This Amendment shall be binding upon and
inure to the benefit of the Administrative Agent, the Lenders and the Borrower
and their respective successors and assigns permitted pursuant to the Loan
Agreement. This Amendment may be executed in counterparts with each counterpart
constituting an original and all of the counterparts, once executed,
constituting but one original. Delivery of an executed counterpart by facsimile
or other electronic means shall be effective as delivery of an original executed
counterpart.

 

[Signature Pages Follow]

 

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If the foregoing is acceptable to you, please execute a copy of this letter
agreement in the spaces provided below to evidence your acceptance and approval
of the foregoing and return a fully-executed counterpart of this letter to the
attention of the undersigned.

 

  Very truly yours,             APOLLO INVESTMENT CORPORATION, as
Administrative Agent for the Lenders               By:   Apollo Investment
Management, L.P.                 By: ACC Management, LLC, as its
General Partner             By: /s/ Ted
Goldthorpe                                                    Name:   Ted
Goldthorpe   Title:      President  

 

Amendment No. 7— Miller Energy Resources, Inc.

 

Signature Page

 

 

 

 

  Acknowledged, agreed and accepted as of the 20th day of September, 2013.      
  BORROWER:         MILLER ENERGY RESOURCES, INC.,   a Tennessee corporation    
    By:   /s/ Scott M. Boruff                             Name:  Scott M. Boruff
    Title:    Chief Executive Officer             GUARANTORS:         MILLER
DRILLING, TN LLC         By: MILLER ENERGY RESOURCES, INC.,     its Sole Member
          By: /s/ Scott M. Boruff                             Name: Scott M.
Boruff     Title: Chief Executive Officer         MILLER ENERGY SERVICES, LLC  
      By: MILLER ENERGY RESOURCES, INC.,     its Sole Manager           By: /s/
Scott M. Boruff                             Name: Scott M. Boruff     Title:
Chief Executive Officer         MILLER ENERGY GP, LLC         By: MILLER ENERGY
RESOURCES, INC.,     its Sole Manager           By: /s/ Scott M.
Boruff                             Name: Scott M. Boruff     Title: Chief
Executive Officer

 

Amendment No. 7— Miller Energy Resources, Inc.

 

Signature Page

 

 

 

 

  MILLER RIG & EQUIPMENT, LLC         By: MILLER ENERGY RESOURCES, INC.,    
its Sole Manager           By: /s/ Scott M. Boruff                            
Name: Scott M. Boruff     Title: Chief Executive Officer         COOK INLET
ENERGY, LLC         By: /s/ David M. Hall                             Name:
David M. Hall     Title: Manager and Chief Executive Officer         EAST
TENNESSEE CONSULTANTS, INC.         By: /s/ Eugene D.
Lockyear                             Name: Eugene Lockyear     President        
EAST TENNESSEE CONSULTANTS II, L.L.C.         By: /s/ Eugene D.
Lockyear                             Name:Eugene Lockyear     Title:Manager and
President

  

Amendment No. 7— Miller Energy Resources, Inc.

 

Signature Page

 

 

 

 

EXHIBIT A

 

ARTICLES OF AMENDMENT TO THE CHARTER OF

 

MILLER ENERGY RESOURCES, INC.

 

Pursuant to the provisions of the Tennessee Business Corporation Act, §48-20-201
et. seq. the undersigned Corporation adopted the following Articles of Amendment
to its Charter:

 

The name of the Corporation is Miller Energy Resources, Inc.

 

The amendment is adopted is: Article Six of the Corporation’s Amended and
Restated Charter is hereby amended by adding the following:

 

In accordance with Sections 48-20-102 and 48-20-106 of the Tennessee Business
Corporation Act (“TBCA”), the undersigned corporation adopts the following
Articles of Amendment (the “Articles of Amendment”) to its Charter (the
“Charter”):

 

1. The name of this corporation is Miller Energy Resources, Inc. (the
“Corporation”)

 

2. Article Six of the Charter is hereby amended, pursuant to the authority
granted to the Board of Directors (the “Board”) of this corporation by Section
6(c) of the Charter, by adding the following subsection (f) to Article Six of
the Charter, which subsection states the number, designation, relative rights,
preferences and limitations of a new series of preferred stock as fixed by the
Board and shall read in its entirety as follows:

 

(f) 10.5% Series D Fixed Rate/Floating Rate Cumulative Redeemable Preferred
Stock.

 

(i) Designation and Amount. The shares of such series shall be designated as
“10.5% Series D Fixed Rate/Floating Rate Cumulative Redeemable Preferred Stock”
(the “Series D Preferred Stock”) and the number of shares initially authorized
constituting such series shall be 4,000,000 shares, par value $0.0001 per share.
Such number of shares may be increased or decreased by resolution of the Board;
provided, that no decrease shall reduce the number of shares of Series D
Preferred Stock to a number less than the number of shares then outstanding.

 

(ii) Maturity. The Series D Preferred Stock has no stated maturity and will not
be subject to any sinking fund or mandatory redemption. Shares of Series D
Preferred Stock will remain outstanding indefinitely unless the Corporation
decides to redeem or otherwise repurchase them pursuant to Section 6(f)(vi)
hereof or converted pursuant to Section 6(f)(vii) hereof. The Corporation is not
required to set aside funds to redeem the Series D Preferred Stock.

 

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(iii) Ranking. The Series D Preferred Stock will rank, with respect to rights to
the payment of dividends and the distribution of assets in the event of any
liquidation, dissolution or winding up of the Corporation, (A) senior to all
classes or series of the Corporation’s common stock (the “Common Stock”), and to
all other equity securities issued by the Corporation other than equity
securities referred to in clauses (B) and (C) of this Section (iii); (B) junior
to the Series B Preferred Stock and to all equity securities issued by the
Corporation which have terms specifically providing that those equity securities
rank senior to the Series D Preferred Stock with respect to rights to the
distribution of assets upon any liquidation, dissolution or winding up of the
Corporation; and (C) on parity with the Series C Preferred Stock and all other
equity securities issued by the Corporation with terms specifically providing
that those equity securities rank on parity with the Series D Preferred Stock
with respect to rights to the distribution of assets upon any liquidation,
dissolution or winding up of the Corporation. The term “equity securities” shall
not include convertible debt securities.

 

(iv) Dividends.

 

(A) Payment. Holders of shares of the Series D Preferred Stock are entitled to
receive, when, as and if declared by the Board, out of funds of the Corporation
legally available for the payment of dividends, cumulative cash dividends at an
annual rate (the “Regular Dividend Rate”) of (i) 10.5% during the Fixed Rate
Period (defined below), based on the $25.00 per share liquidation preference per
annum (equivalent to $2.625 per annum per share during such period) and (ii)
during the Floating Rate Period (defined below), the sum of (a) Three-Month
LIBOR (as defined below) as calculated on each applicable date of determination
and (b) the Applicable Spread (as defined below), based on the $25.00 per share
liquidation preference per annum; provided that this stated dividend rate shall
be subject to the increases required under Section 6(f)(iv)(F).

 

The term “Fixed Rate Period” means the period from and including the date of
original issuance of the Series D Preferred Stock to, but not including,
December 1, 2018.

 

The term “Floating Rate Period” means the period from and including December 1,
2018 and thereafter until such time as the Series D Preferred Stock is redeemed
pursuant to Section 6(f)(vi) hereof or is converted pursuant to Section
6(f)(vii) hereof.

 

The term “Three-Month LIBOR” means, on any date of determination, the rate
(expressed as a percentage per year) for deposits in U.S. dollars for a
three-month period as appears on Bloomberg, L.P. page US0003M, as set by the
British Bankers Association at 11 am (London time) on such date of
determination. If the appropriate page is replaced or service ceases to be
available, the Corporation, acting reasonably, may select another page or
service displaying the appropriate rate.

 

The term “Applicable Spread” means a rate of [_____]% per annum.

 

Dividends on the Series D Preferred Stock issued in connection with the
Corporation’s initial public offering of Series D Preferred Stock shall
accumulate daily and shall be cumulative from, and including, the date on which
the first such shares are first sold to any purchaser and shall be payable
quarterly in arrears on the first day of each December, March, June and
September of each year (each, a “Series D Dividend Payment Date”); provided,
that if any Series D Dividend Payment Date is not a Business Day (as defined
below), then the dividend which would otherwise have been payable on that Series
D Dividend Payment Date may be paid on the next succeeding Business Day with the
same force and effect as if paid on such Series D Dividend Payment Date and no
interest, additional dividends or other sums will accumulate on the amount so
payable for the period from and after such Series D Dividend Payment Date to
such next succeeding Business Day.

 

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For dividend periods beginning on and after December 1, 2018, the Three-Month
LIBOR shall be determined quarterly on the Series D Dividend Payment Date, which
determination will apply to each day during the Series D Dividend Period in
which that determination is made. “Series D Dividend Period” means a quarterly
dividend period beginning on and including a Series D Dividend Payment Date to,
but not including, the following Series D Dividend Payment Date.

 

Any dividend payable on the Series D Preferred Stock, including dividends
payable for any partial dividend period, will be computed on the basis of a
360-day year consisting of twelve 30-day months. Dividends will be payable to
holders of record as they appear in the stock records of the Corporation for the
Series D Preferred Stock at the close of business on the applicable record date,
which shall be the 15th day of each calendar month immediately preceding the
relevant Series D Dividend Payment Date, whether or not a Business Day (each, a
“Series D Dividend Record Date”). The dividends payable on any Series D Dividend
Payment Date shall include dividends accumulated to, but not including, such
Series D Dividend Payment Date.

 

(B) Restrictions on Payment. No dividends on shares of Series D Preferred Stock
shall be authorized by the Board or paid or set apart for payment by the
Corporation at any time when the terms and provisions of any agreement of the
Corporation, including any other classes or series of equity securities issued
by the Corporation or any agreement relating to any indebtedness of the
Corporation (including, but not limited to, the Loan Agreement, dated June 29,
2012, between the Corporation, as borrower, Apollo Investment Corporation, as
administrative agent, and the other lenders party thereto from time to time, as
the same may be amended from time to time, with such loan agreement, securities
and other agreements being referred to herein as the “Limiting Documents”),
prohibit the authorization, payment or setting apart for payment thereof or
provide that the authorization, payment or setting apart for payment thereof
would constitute a breach of the Limiting Documents or a default under the
Limiting Documents, or if the authorization, payment or setting apart for
payment shall be restricted or prohibited by law.

 

(C) Accumulation. Notwithstanding anything to the contrary contained herein,
dividends on the Series D Preferred Stock will accumulate whether or not the
Corporation has earnings, whether or not there are funds legally available for
the payment of those dividends and whether or not those dividends are declared.
No interest, or sum in lieu of interest, will be payable in respect of any
dividend payment or payments on the Series D Preferred Stock which may be in
arrears, and holders of the Series D Preferred Stock will not be entitled to any
dividends in excess of full cumulative dividends described in Section
6(f)(iv)(A). Any dividend payment made on the Series D Preferred Stock shall
first be credited against the earliest accumulated but unpaid dividend due with
respect to the Series D Preferred Stock.

 

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(D) Other Classes or Series of Equity. Except as provided in Section
6(f)(iv)(E), unless full cumulative dividends on the Series D Preferred Stock
have been or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof is set apart for payment for all past
dividend periods, (i) no dividends (other than in shares of Common Stock or in
shares of any classes or series of equity securities that the Corporation may
issue ranking junior to the Series D Preferred Stock as to dividends and upon
liquidation) shall be declared or paid or set aside for payment upon shares of
Common Stock or preferred stock that the Corporation may issue ranking junior to
or on parity with the Series D Preferred Stock as to dividends or upon
liquidation, (ii) no other distribution shall be declared or made upon shares of
Common Stock or preferred stock that the Corporation may issue ranking junior to
or on parity with the Series D Preferred Stock as to dividends or upon
liquidation, and (iii) any shares of Common Stock or preferred stock that the
Corporation may issue ranking junior to or on parity with the Series D Preferred
Stock as to dividends or upon liquidation shall not be redeemed, purchased or
otherwise acquired for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any such shares) by the
Corporation (except (x) as mandatorily required by the terms of such equity
security or (y) by conversion into or exchange for other capital stock of the
Corporation that it may issue ranking junior to the Series D Preferred Stock as
to dividends and upon liquidation).

 

(E) Partial Payment. When dividends are not paid in full (or a sum sufficient
for such full payment is not so set apart) upon the Series D Preferred Stock and
the shares of any other series of preferred stock that the Corporation may issue
ranking on parity as to dividends with the Series D Preferred Stock, all
dividends declared upon the Series D Preferred Stock and any Series C Preferred
Stock or other series of preferred stock the Corporation may issue ranking on
parity as to dividends with the Series D Preferred Stock shall be declared pro
rata so that the amount of dividends declared per share of Series D Preferred
Stock and such other series of preferred stock shall in all cases bear to each
other the same ratio that accumulated (or accrued with respect to the other
classes or series) dividends per share on the Series D Preferred Stock and such
other series of preferred stock (which shall not include any accrual in respect
of unpaid dividends for prior dividend periods if any such equity securities do
not have a cumulative dividend) bear to each other. No interest, or sum of money
in lieu of interest, shall be payable in respect of any dividend payment or
payments on the Series D Preferred Stock which may be in arrears.

 

(F) Penalty Events. Whenever (I) a Series D Listing Event (as defined hereafter)
has occurred or (II) dividends on any shares of Series D Preferred Stock are in
arrears for four or more quarterly dividend periods, whether or not consecutive
(the events in clause (I) and (II) each being a “Penalty Event”), the dividend
rate specified in Section 6(f)(iv)(A) shall be increased by 2.00% per annum
(which, during the Fixed Rate Period, will be the equivalent of a 12.5% rate per
annum based on the $25.00 per share liquidation preference, which is equivalent
to $3.125 per share per annum) (the “Penalty Rate”). For purposes hereof a
“Series D Listing Event” shall have occurred if, on or after October 31, 2013
the Series D Preferred Stock is not listed for trading on the New York Stock
Exchange LLC (the “NYSE”), the NYSE MKT LLC (the “NYSE MKT”) or the NASDAQ Stock
Market (“NASDAQ”), or listed or quoted on an exchange or quotation system that
is a successor to the NYSE, the NYSE MKT or NASDAQ (each a “National Exchange”)
for 180 or more consecutive days. This Penalty Rate shall remain in effect until
(x) shares of the Series D Preferred Stock are listed for trading on a National
Exchange and (y) all accrued but unpaid dividends on the Series D Preferred
Stock have been paid in full and the Corporation shall have paid all dividends
due on the Series D Preferred Stock for the two most recently ended quarterly
dividend payment periods, at which time the dividend rate shall revert to the
rate as specified in Section 6(f)(iv)(A) for the next occurring dividend payment
period (unless a new Penalty Event shall have occurred prior to and shall be
continuing at the start of, such next occurring dividend payment period).

 

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(G) Business Day Defined. “Business Day” shall mean any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions in New York, New York or Knoxville, Tennessee are authorized or
required by law, regulation or executive order to close.

 

(v) Liquidation Preference.

 

(A) Liquidation Payment. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, the holders of shares
of Series D Preferred Stock will be entitled to be paid out of the assets the
Corporation has legally available for distribution to its stockholders, subject
to the preferential rights of the holders of the Series B Redeemable Preferred
Stock and any class or series of equity securities of the Corporation ranking
senior to the Series D Preferred Stock with respect to the distribution of
assets upon liquidation, dissolution or winding up, a liquidation preference of
$25.00 per share, plus an amount equal to any accumulated and unpaid dividends
to, but not including, the date of payment, before any distribution of assets is
made to holders of Common Stock or any other class or series of equity
securities the Corporation may issue which ranks junior to the Series D
Preferred Stock as to liquidation rights.

 

(B) Partial Distribution in Liquidation. In the event that, upon any such
voluntary or involuntary liquidation, dissolution or winding up, the available
assets of the Corporation are insufficient to pay the amount of the liquidating
distributions on all outstanding shares of Series D Preferred Stock and the
corresponding amounts payable on all shares of other classes or series of equity
securities the Corporation may issue ranking on parity with the Series D
Preferred Stock in the distribution of assets, then the holders of the Series D
Preferred Stock and all other such classes or series of equity securities shall
share ratably in any such distribution of assets in proportion to the full
liquidating distributions to which they would otherwise be respectively
entitled.

 

(C) Notice of Liquidation. Holders of Series D Preferred Stock will be entitled
to written notice of any such liquidation, dissolution or winding up no fewer
than 30 days and no more than 60 days prior to the payment date for the
liquidating distributions payable under Section 6(f)(v)(A).

 

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(D) Other Rights on Liquidation. After payment of the full amount of the
liquidating distributions to which they are entitled, the holders of Series D
Preferred Stock will have no right or claim to any of the remaining assets of
the Corporation.

 

(E) Events Deemed Not to Be Liquidations. The consolidation or merger of the
Corporation with or into any other corporation, trust or entity or of any other
entity with or into the Corporation, or the sale, lease, transfer or conveyance
of all or substantially all of the property or business the Corporation, shall
not be deemed to constitute a liquidation, dissolution or winding up of the
Corporation.

 

(vi) Redemption.

 

(A) Restriction on Redemption. The Series D Preferred Stock is not redeemable by
the Corporation prior to the fifth anniversary of the date the Series D
Preferred Stock is initially issued by the Company (the “Series D Initial
Permitted Redemption Date”) except in accordance with Sections 6(f)(vi)(C);
provided, however, that no redemption by the Corporation of the Series D
Preferred Stock otherwise permitted in this Section 6(f)(vi) shall occur if any
term or condition contained in any Limiting Document shall prohibit it or if
such redemption shall result in a default thereunder.

 

(B) Optional Redemption Right. On and after the Series D Initial Permitted
Redemption Date, the Corporation may, at its option, upon not less than 30 nor
more than 60 days’ written notice, redeem the Series D Preferred Stock, in whole
or in part, at any time or from time to time, for cash at a redemption price of
Twenty-Five Dollars ($25.00) per share, plus any accumulated and unpaid
dividends thereon to, but not including, the date fixed for redemption. If the
Corporation elects to redeem any shares of Series D Preferred Stock as described
in this Section 6(f)(vi)(B), it may use any available cash to pay the redemption
price, and it will not be required to pay the redemption price only out of the
proceeds from the issuance of other equity securities or any other specific
source.

 

(C) Special Optional Redemption Right. Upon the occurrence of a Change of
Control (as defined below), provided no Limiting Document may prohibit it, the
Corporation may, at its option, upon not less than 30 nor more than 60 days’
written notice, redeem the Series D Preferred Stock, in whole or in part, within
120 days after the first date on which such Change of Control occurred, for cash
at a redemption price of $25.00 per share, plus any accumulated and unpaid
dividends to, but not including, the date fixed for redemption. If, prior to the
Series D Change of Control Conversion Date (as defined below), the Corporation
has provided notice of our election to redeem some or all of the shares of
Series D Preferred Stock (whether pursuant to Sections 6(f)(vi)(B) or (C)), the
holders of Series D Preferred Stock will not have the Series D Change of Control
Conversion Right (as defined below) with respect to the shares of Series D
Preferred Stock called for redemption. If the Corporation elects to redeem any
shares of Series D Preferred Stock as described in this Section 6(f)(vi)(C), it
may use any available cash to pay the redemption price, and it will not be
required to pay the redemption price only out of the proceeds from the issuance
of other equity securities or any other specific source.

 

6

 

 

(D) A “Change of Control” is deemed to occur when, after the original issuance
of the Series D Preferred Stock, the following have occurred and are continuing:
(i) the acquisition by any person, including any syndicate or group deemed to be
a “person” under Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), of beneficial ownership, directly or indirectly,
through a purchase, merger or other acquisition transaction or series of
purchases, mergers or other acquisition transactions of our stock entitling that
person to exercise more than 50% of the total voting power of all our stock
entitled to vote generally in the election of our directors (except that such
person will be deemed to have beneficial ownership of all securities that such
person has the right to acquire, whether such right is currently exercisable or
is exercisable only upon the occurrence of a subsequent condition); and (ii)
following the closing of any transaction referred to in the bullet point above,
neither the Corporation nor the acquiring or surviving entity has a class of
common securities (or American depositary receipts representing such securities)
listed on a National Exchange.

 

(E) Series D Change of Control Conversion Right Redemption Procedures. In the
event the Corporation elects to redeem Series D Preferred Stock, the notice of
redemption will be mailed by the Corporation, postage prepaid, not less than 30
nor more than 60 days prior to the redemption date, to each holder of record of
Series D Preferred Stock called for redemption at such holder’s address as it
appears on the stock transfer records of the Corporation and shall state: (I)
the redemption date; (II) the number of shares of Series D Preferred Stock to be
redeemed; (III) the redemption price; (IV) the place or places where
certificates (if any) for the Series D Preferred Stock are to be surrendered for
payment of the redemption price; (V) that dividends on the shares to be redeemed
will cease to accumulate on the redemption date; (VI) whether such redemption is
being made pursuant to Section 6(f)(vi)(B) or Section 6(f)(vi)(C); (VII) if
applicable, that such redemption is being made in connection with a Change of
Control and, in that case, a brief description of the transaction or
transactions constituting such Change of Control; and (VIII) if such redemption
is being made in connection with a Change of Control, that the holders of the
shares of Series D Preferred Stock being so called for redemption will not be
able to tender such shares of Series D Preferred Stock for conversion in
connection with the Change of Control and that each share of Series D Preferred
Stock tendered for conversion that is called, prior to the Series D Change of
Control Conversion Date (as defined below), for redemption will be redeemed on
the related date of redemption instead of converted on the Series D Change of
Control Conversion Date. If less than all of the shares of Series D Preferred
Stock held by any holder are to be redeemed, the notice mailed to such holder
shall also specify the number of shares of Series D Preferred Stock held by such
holder to be redeemed. No failure to give such notice or any defect thereto or
in the mailing thereof shall affect the validity of the proceedings for the
redemption of any shares of Series D Preferred Stock except as to the holder to
whom notice was defective or not given.

 

(F) Surrender and Payment. Holders of Series D Preferred Stock to be redeemed
shall surrender the Series D Preferred Stock at the place designated in the
notice of redemption and shall be entitled to the redemption price and any
accumulated and unpaid dividends payable upon the redemption following the
surrender.

 

7

 

 

(G) Cessation of Dividends after Redemption Notice. If notice of redemption of
any shares of Series D Preferred Stock has been given and if the Corporation
irrevocably sets aside the funds necessary for redemption in trust for the
benefit of the holders of the shares of Series D Preferred Stock so called for
redemption, then from and after the redemption date (unless the Corporation
shall default in providing for the payment of the redemption price plus
accumulated and unpaid dividends, if any), dividends will cease to accumulate on
those shares of Series D Preferred Stock, those shares of Series D Preferred
Stock shall no longer be deemed outstanding and all rights of the holders of
those shares will terminate, except the right to receive the redemption price
plus accumulated and unpaid dividends, if any, payable upon redemption.

 

(H) Redemption on Non-Business Day. If any redemption date is not a Business
Day, then the redemption price and accumulated and unpaid dividends, if any,
payable upon redemption may be paid on the next Business Day and no interest,
additional dividends or other sums will accumulate on the amount payable for the
period from and after that redemption date to that next Business Day.

 

(I) Partial Redemption. If less than all of the outstanding Series D Preferred
Stock is to be redeemed, the Series D Preferred Stock to be redeemed shall be
selected pro rata (as nearly as may be practicable without creating fractional
shares) or by lot.

 

(J) Unpaid Dividends. Immediately prior to any redemption of Series D Preferred
Stock, the Corporation shall pay, in cash, any accumulated and unpaid dividends
through and including the redemption date, unless a redemption date falls after
a Series D Dividend Record Date and prior to the corresponding Series D Dividend
Payment Date, in which case each holder of Series D Preferred Stock at the close
of business on such Series D Dividend Record Date shall be entitled to the
dividend payable on such shares on the corresponding Series D Dividend Payment
Date notwithstanding the redemption of such shares before such Series D Dividend
Payment Date. Except as provided in this paragraph, the Corporation will make no
payment or allowance for unpaid dividends, whether or not in arrears, on shares
of the Series D Preferred Stock to be redeemed.

 

(K) Additional Limitation on Redemption. Unless full cumulative dividends on all
shares of Series D Preferred Stock shall have been or contemporaneously are
declared and paid or declared and a sum sufficient for the payment thereof has
been or contemporaneously is set apart for payment for all past dividend
periods, no shares of Series D Preferred Stock shall be redeemed unless all
outstanding shares of Series D Preferred Stock are simultaneously redeemed and
the Corporation shall not purchase or otherwise acquire directly or indirectly
any shares of Series D Preferred Stock (except by exchanging it for its capital
stock ranking junior to the Series D Preferred Stock as to dividends and upon
liquidation); provided, however, that the foregoing shall not prevent the
purchase or acquisition by the Corporation of shares of Series D Preferred Stock
pursuant to a purchase or exchange offer made on the same terms to holders of
all outstanding shares of Series D Preferred Stock.

 

(L) Purchase of Shares by Corporation Permitted. Subject to applicable law, the
Corporation may purchase shares of Series D Preferred Stock in the open market,
by tender or by private agreement. Any shares of Series D Preferred Stock that
the Corporation acquires may be retired and re-classified as authorized but
unissued shares of preferred stock, without designation as to class or series,
and may thereafter be reissued as any class or series of preferred stock.

 

8

 

 

(vii) Series D Change of Control Conversion Rights. Shares of Series D Preferred
Stock are not convertible into or exchangeable for any other property or
securities of the Corporation, except as provided in this Section 6(f)(vii).

 

(A) [Reserved.]

 

(B) [Reserved.]

 

(C) Series D Change of Control Conversion Right. Upon the occurrence of a Change
of Control, each holder of Series D Preferred Stock will have the right (unless,
prior to the Series D Change of Control Conversion Date, the Corporation has
provided notice of its election to redeem some or all of the shares of Series D
Preferred Stock held by such holder as described in Sections 6(f)(vi)(B) and
6(f)(vi)(C) above, in which case such holder will have the right only with
respect to shares of Series D Preferred Stock that are not called for
redemption), to convert some or all of the Series D Preferred Stock held by such
holder (the “Series D Change of Control Conversion Right”) on the Series D
Change of Control Conversion Date into a number of shares of the Corporation’s
common stock per share of Series D Preferred Stock (the “Series D/Common Stock
Conversion Consideration”) equal to the lesser of: (i) the quotient obtained by
dividing (i) the sum of the $25.00 liquidation preference per share of Series D
Preferred Stock plus the amount of any accumulated and unpaid dividends thereon
to, but not including, the Series D Change of Control Conversion Date (unless
the Series D Change of Control Conversion Date is after a Series D Dividend
Record Date (as defined herein) and prior to the corresponding Series D Dividend
Payment Date (as defined herein) for the Series D Preferred Stock, in which case
no additional amount for such accrued and unpaid dividends will be included in
this sum) by (ii) the Common Stock Price (as defined below); and (ii) [ ] (the
“Share Cap”), subject to adjustments to the Share Cap for any splits,
subdivisions or combinations of our common stock; in each case, on the terms and
subject to the conditions described in this Section 6(f)(vii).

 

(D) [Reserved.]

 

(E) Share Cap Adjustments. If the Corporation, at any time while Series D
Preferred Stock is outstanding: (i) pays a stock dividend in the Common Stock
with respect to the then-outstanding Common Stock; (ii) subdivides outstanding
Common Stock into a larger number of shares; or (iii) combines (including by way
of a reverse stock split) outstanding Common Stock into a smaller number of
shares (in each case, a “Share Split”), then the Share Cap will subject to pro
rata adjustments as follows: the adjusted Share Cap as the result of a Share
Split will be the number of shares of Common Stock that is equivalent to the
product obtained by multiplying (i) the Share Cap in effect immediately prior to
such Share Split by (ii) a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after giving effect to such Share
Split and the denominator of which is the number of shares of Common Stock
outstanding immediately prior to such Share Split. For the avoidance of doubt,
subject to the immediately succeeding sentence, the aggregate number of shares
of Common Stock (or equivalent Alternative Conversion Consideration (as defined
below), as applicable) issuable or deliverable, as applicable, in connection
with the exercise of the Series D Change of Control Conversion Right will not
exceed [____________] shares of Common Stock (or equivalent Alternative
Conversion Consideration, as applicable).

 

9

 

 

(F) Series D Change of Control Conversion Date Defined. The “Series D Change of
Control Conversion Date” is the date the Series D Preferred Stock is to be
converted, which will be a Business Day selected by the Corporation that is no
fewer than 20 days nor more than 35 days after the date on which it provides the
notice of the related Change of Control described in Section 6(f)(vii)(K) (or in
Section 6(f)(vi)(E) if the relevant Change of Control is described therein) to
the holders of Series D Preferred Stock.

 

(G) Common Stock Price Defined. The “Common Stock Price” is (i) if the
consideration to be received in the Change of Control by the holders of Common
Stock is solely cash, the amount of cash consideration per share of Common Stock
or (ii) if the consideration to be received in the Change of Control by holders
of Common Stock is other than solely cash (x) the average of the closing sale
prices per share of Common Stock (or, if no closing sale price is reported, the
average of the closing bid and ask prices per share or, if more than one in
either case, the average of the average closing bid and the average closing ask
prices per share) for the ten consecutive trading days immediately preceding,
but not including, the date on which such Change of Control occurred as reported
on the principal U.S. securities exchange on which Common Stock is then traded,
or (y) the average of the last quoted bid prices for Common Stock in the
over-the-counter market as reported by Pink OTC Markets Inc. or similar
organization for the ten consecutive trading days immediately preceding, but not
including, the date on which such Change of Control occurred, if Common Stock is
not then listed for trading on a U.S. securities exchange.

 

(H) Alternative Consideration. In the case of a Change of Control pursuant to
which Common Stock is or will be converted into cash, securities or other
property or assets (including any combination thereof) (the “Alternative Form
Consideration”), a holder of Series D Preferred Stock will receive upon
conversion of such Series D Preferred Stock the kind and amount of Alternative
Form Consideration which such holder would have owned or been entitled to
receive upon the Change of Control had such holder held a number of shares of
Common Stock equal to the Series D/Common Stock Conversion Consideration
immediately prior to the effective time of the Change of Control (the
“Alternative Conversion Consideration”; the Series D/Common Stock Conversion
Consideration or the Alternative Conversion Consideration, whichever shall be
applicable to a Change of Control, is referred to as the “Conversion
Consideration”).

 

(I) Deemed Election of Conversion Consideration. If the holders of Common Stock
have the opportunity to elect the form of consideration to be received in the
Change of Control, the Conversion Consideration in respect of such Change of
Control will be deemed to be the kind and amount of consideration actually
received by holders of a majority of the outstanding shares of Common Stock that
made or voted for such an election (if electing between two types of
consideration) or holders of a plurality of the outstanding shares of Common
Stock that made or voted for such an election (if electing between more than two
types of consideration), as the case may be, and will be subject to any
limitations to which all holders of Common Stock are subject, including, without
limitation, pro rata reductions applicable to any portion of the consideration
payable in such Change of Control.

 

10

 

 

(J) No Fractional Shares Issued. No fractional shares of Common Stock upon the
conversion of the Series D Preferred Stock in connection with a Change of
Control will be issued. Instead, the Corporation will make a cash payment equal
to the value of such fractional shares based upon the Common Stock Price used in
determining the Series D/Common Stock Conversion Consideration for such Change
of Control.

 

(K) Notice of Change of Control. Within 15 days following the occurrence of a
Change of Control, provided that the Corporation has not then exercised its
right to redeem all shares of Series D Preferred Stock pursuant to Section
6(f)(vi), the Corporation will provide to holders of Series D Preferred Stock a
notice of occurrence of the Change of Control that describes the resulting
Series D Change of Control Conversion Right, which notice shall be delivered to
the holders of record of the shares of the Series D Preferred Stock in their
addresses as they appear on the stock transfer records of the Corporation and
shall state: (i) the events constituting the Change of Control; (ii) the date of
the Change of Control; (iii) the last date on which the holders of Series D
Preferred Stock may exercise their Series D Change of Control Conversion Right;
(iv) the method and period for calculating the Common Stock Price; (v) the
Series D Change of Control Conversion Date; (vi) that if, prior to the Series D
Change of Control Conversion Date, the Corporation has provided notice of its
election to redeem all or any shares of Series D Preferred Stock, holders will
not be able to convert the shares of Series D Preferred Stock called for
redemption and such shares will be redeemed on the related redemption date, even
if such shares have already been tendered for conversion pursuant to the Series
D Change of Control Conversion Right; (vii) if applicable, the type and amount
of Alternative Conversion Consideration entitled to be received per share of
Series D Preferred Stock; (viii) the name and address of the paying agent,
transfer agent and conversion agent for the Series D Preferred Stock; (ix) the
procedures that the holders of Series D Preferred Stock must follow to exercise
the Series D Change of Control Conversion Right (including procedures for
surrendering shares for conversion through the facilities of a Depositary (as
defined below)), including the form of conversion notice to be delivered by such
holders as described below; and (x) the last date on which holders of Series D
Preferred Stock may withdraw shares surrendered for conversion and the
procedures that such holders must follow to effect such a withdrawal.

 

(L) Publication of Notice. The Corporation shall also issue a press release
containing such notice provided for in the preceding Section 6(f)(vii)(K) for
publication on either of Dow Jones & Company, Inc., Business Wire, PR Newswire
or Bloomberg Business News (or, if these organizations are not in existence at
the time of issuance of the press release, such other news or press organization
as is reasonably calculated to broadly disseminate the relevant information to
the public), and post a notice on its website, in any event prior to the opening
of business on the first Business Day following any date on which it provides
the notice provided for in Section 6(f)(vii)(K) to the holders of Series D
Preferred Stock.

 

11

 

 

(M) Procedures for Exercise of Series D Change of Control Conversion Right. To
exercise the Series D Change of Control Conversion Right, the holders of Series
D Preferred Stock will be required to deliver, on or before the close of
business on the Series D Change of Control Conversion Date, the certificates (if
any) representing the shares of Series D Preferred Stock to be converted, duly
endorsed for transfer (or, in the case of any shares of Series D Preferred Stock
held in book-entry form through a Depositary, to deliver, on or before the close
of business on the Series D Change of Control Conversion Date, the shares of
Series D Preferred Stock to be converted through the facilities of such
Depositary), together with a written conversion notice in the form provided by
the Corporation, duly completed, to its transfer agent. The conversion notice
must state: (i) the relevant Series D Change of Control Conversion Date; (ii)
the number of shares of Series D Preferred Stock to be converted; and (iii) that
the Series D Preferred Stock is to be converted pursuant to the applicable
provisions of the Series D Preferred Stock.

 

(N) Withdrawal of Election of Series D Change of Control Conversion Right.
Holders of Series D Preferred Stock may withdraw any notice of exercise of a
Series D Change of Control Conversion Right (in whole or in part) by a written
notice of withdrawal delivered to the transfer agent of the Corporation prior to
the close of business on the Business Day prior to the Series D Change of
Control Conversion Date. The notice of withdrawal delivered by any holder must
state: (i) the number of withdrawn shares of Series D Preferred Stock; (ii) if
certificated Series D Preferred Stock has been surrendered for conversion, the
certificate numbers of the withdrawn shares of Series D Preferred Stock; and
(iii) the number of shares of Series D Preferred Stock, if any, which remain
subject to the holder’s conversion notice.

 

(O) Compliance with Depositary Requirements. Notwithstanding anything to the
contrary contained in Sections 6(f)(vii)(M) and (N), if any shares of Series D
Preferred Stock are held in book-entry form through The Depository Trust Company
(“DTC”) or a similar depositary (each, a “Depositary”), the conversion notice
and/or the notice of withdrawal, as applicable, must comply with applicable
procedures, if any, of the applicable Depositary.

 

(P) Conversion following Election of Series D Change of Control Conversion
Right. Series D Preferred Stock as to which the Series D Change of Control
Conversion Right has been properly exercised and for which the conversion notice
has not been properly withdrawn will be converted into the applicable Conversion
Consideration in accordance with the Series D Change of Control Conversion Right
on the Series D Change of Control Conversion Date, unless prior to the Series D
Change of Control Conversion Date the Corporation has provided notice of its
election to redeem some or all of the shares of Series D Preferred Stock
pursuant to Section 6(f)(vi), in which case only the shares of Series D
Preferred Stock properly surrendered for conversion and not properly withdrawn
that are not called for redemption will be converted as aforesaid. If the
Corporation elects to redeem shares of Series D Preferred Stock that would
otherwise be converted into the applicable Conversion Consideration on a Series
D Change of Control Conversion Date, such shares of Series D Preferred Stock
will not be so converted and the holders of such shares will be entitled to
receive on the applicable redemption date the redemption price as provided in
Section 6(f)(vi).

 

12

 

 

(Q) Delivery of Conversion Consideration. The Corporation shall deliver all
securities, cash and any other property owing upon conversion no later than the
third Business Day following the Series D Change of Control Conversion Date.
Notwithstanding the foregoing, the persons entitled to receive any shares of
Common Stock or other securities delivered on conversion will be deemed to have
become the holders of record thereof as of the Series D Change of Control
Conversion Date.

(R) Compliance with Laws. In connection with the exercise of any Series D Change
of Control Conversion Right, the Corporation shall comply with all federal and
state securities laws and stock exchange rules in connection with any conversion
of Series D Preferred Stock into shares of Common Stock or other property.

(S) Certain Dividends Payable Following Conversion. Notwithstanding anything to
the contrary herein and except as otherwise required by law, the persons who are
the holders of record of shares of Series D Preferred Stock at the close of
business on a Series D Dividend Record Date will be entitled to receive the
dividend payable on the corresponding Series D Dividend Payment Date
notwithstanding the conversion of those shares (pursuant to a Series D Change of
Control Conversion Right or otherwise) after such Series D Dividend Record Date
and on or prior to such Series D Dividend Payment Date and, in such case, the
full amount of such dividend shall be paid on such Series D Dividend Payment
Date to the persons who were the holders of record at the close of business on
such Series D Dividend Record Date. Except as provided in this paragraph (S),
the Corporation will make no allowance for unpaid dividends that are not in
arrears on the shares of Series D Preferred Stock to be converted.

 

(viii) [Reserved.]

 

(ix) Voting Rights.

 

(A) Voting Rights Generally. Holders of the Series D Preferred Stock will not
have any voting rights, except as set forth in this Section 6(f)(ix) or as
otherwise required by law. On each matter on which holders of Series D Preferred
Stock are entitled to vote, each share of Series D Preferred Stock will be
entitled to one vote, except that when shares of any other class or series of
equity securities the Corporation may issue have the right to vote with the
Series D Preferred Stock as a single class on any matter, the Series D Preferred
Stock and the shares of each such other class or series will have one vote for
each $25.00 of liquidation preference (excluding accumulated dividends).

 

(B) Board Representation Right. Upon the occurrence of a Penalty Event, the
number of directors constituting the Board will be automatically increased by
two, subject to the maximum number authorized under the bylaws then in effect
(if not already increased by two by reason of the election of directors by the
holders of any other class or series of equity securities the Corporation may
issue upon which like voting rights have been conferred and are exercisable and
with which the Series D Preferred Stock is entitled to vote as a class with
respect to the election of those two directors) and the holders of Series D
Preferred Stock (voting separately as a class with all other classes or series
of equity securities the Corporation may issue upon which like voting rights
have been conferred and are exercisable and which are entitled to vote as a
class with the Series D Preferred Stock in the election of those two directors)
will be entitled to vote for the election of those two additional directors at a
special meeting called by the Corporation at the request of the holders of
record of at least 25% of the outstanding shares of Series D Preferred Stock or
by the holders of any other class or series of equity securities the Corporation
may issue upon which like voting rights have been conferred and are exercisable
and which are entitled to vote as a class with the Series D Preferred Stock in
the election of those two directors (unless the request is received less than 90
days before the date fixed for the next annual or special meeting of
stockholders of the Corporation, in which case, such vote will be held at the
earlier of the next annual or special meeting of stockholders of the
Corporation), and at each subsequent annual meeting until a Correction Event (as
defined hereafter) has occurred with respect to each Penalty Event then
continuing. In that case, the right of holders of the Series D Preferred Stock
to elect any directors will cease and, unless there are other classes or series
of equity securities the Corporation may issue upon which like voting rights
have been conferred and are exercisable, any directors elected by holders of the
Series D Preferred Stock shall immediately resign and the number of directors
constituting the Board shall be reduced accordingly.

 

13

 

 

For purposes hereof a “Correction Event” means, (I) with respect to any Series D
Listing Event, the listing of the Series D Preferred Stock for trading on a
National Exchange and (II) with respect to a Penalty Event consisting of the
non-payment of dividends for four or more quarters, the payment in full of all
dividends accumulated on the Series D Preferred Stock for all past dividend
periods and the then current dividend period (or the declaration of such
dividends provided that a sum sufficient for the payment thereof is set aside
for such payment).

 

For the avoidance of doubt, in no event shall the total number of directors
elected by holders of the Series D Preferred Stock (voting separately as a class
with all other classes or series of equity securities the Corporation may issue
upon which like voting rights have been conferred and are exercisable and which
are entitled to vote as a class with the Series D Preferred Stock in the
election of such directors) pursuant to the voting rights under this Section
6(f)(ix)(B) exceed two.

 

(C) Special Provision for Election of Directors; Costs. If a special meeting is
not called by the Corporation within 30 days after request from the requisite
holders of Series D Preferred Stock as described in Section 6(f)(ix)(B), then
the holders of record of at least 25% of the outstanding Series D Preferred
Stock may designate a holder to call the meeting at the expense of the
Corporation and such meeting may be called by the holder so designated upon
notice similar to that required for annual meetings of stockholders and shall be
held at the place designated by the holder calling such meeting. The Corporation
shall pay all costs and expenses of calling and holding any meeting and of
electing directors pursuant to Section 6(f)(ix)(B) or (C), including, without
limitation, the cost of preparing, reproducing and mailing the notice of such
meeting, the cost of renting a room for such meeting to be held, and the cost of
collecting and tabulating votes.

 

14

 

 

(D) Resignation of Directors Elected by Holder of Series D Preferred Stock. If,
at any time when the voting rights conferred upon the Series D Preferred Stock
pursuant to Section 6(f)(ix)(B) are exercisable, any vacancy in the office of a
director elected pursuant to Section 6(f)(ix)(B) or this paragraph (D) shall
occur, then such vacancy may be filled only by the remaining such director or by
vote of the holders of record of the outstanding Series D Preferred Stock and
any other classes or series of equity securities the Corporation may issue upon
which like voting rights have been conferred and are exercisable and which are
entitled to vote as a class with the Series D Preferred Stock in the election of
directors pursuant to Section 6(f)(ix)(B). Any director elected or appointed
pursuant to Section 6(f)(ix)(B) or this paragraph (D) may be removed only by the
affirmative vote of holders of the outstanding Series D Preferred Stock and any
other classes or series of equity securities the Corporation may issue upon
which like voting rights have been conferred and are exercisable and which
classes or series of equity securities the Corporation may issue are entitled to
vote as a class with the Series D Preferred Stock in the election of directors
pursuant to Section 6(f)(ix)(B), such removal to be effected by the affirmative
vote of a majority of the votes entitled to be cast by the holders of the
outstanding Series D Preferred Stock and any such other classes or series of
equity securities the Corporation may issue, and may not be removed by the
holders of the Common Stock.

 

(E) Matters Requiring the Consent of Holders of the Series D Preferred Stock. So
long as any shares of Series D Preferred Stock remain outstanding, the
Corporation will not, without the affirmative vote or consent of the holders of
at least two-thirds of the shares of the Series D Preferred Stock outstanding at
the time, given in person or by proxy, either in writing or at a meeting (voting
together as a series and also together with all other classes or series of
equity securities the Corporation may issue upon which like voting rights have
been conferred and are exercisable), (i) authorize or create, or increase the
authorized or issued amount of, any class or series of equity securities ranking
senior to the Series D Preferred Stock with respect to payment of dividends or
the distribution of assets upon liquidation, dissolution or winding up or
reclassify any of the authorized capital stock of the Corporation into such
shares, or create, authorize or issue any obligation or security convertible
into or evidencing the right to purchase any such shares; or (ii) amend, alter
or repeal the provisions of the Charter, whether by merger, consolidation or
otherwise, so as to materially and adversely affect any right, preference,
privilege or voting power of the Series D Preferred Stock (each, an “Event”);
provided, however, with respect to the occurrence of any Event set forth in
clause (ii), so long as the Series D Preferred Stock remains outstanding with
the terms thereof materially unchanged, taking into account that, upon an
occurrence of an Event, the Corporation may not be the surviving entity, the
occurrence of any such Event shall not be deemed to materially and adversely
affect such rights, preferences, privileges or voting power of holders of the
Series D Preferred Stock and, provided, further, that any increase in the amount
of the authorized Common Stock or other equity securities the Corporation may
issue, including the Series D Preferred Stock, or the creation or issuance of
any additional shares of Common Stock or Series D Preferred Stock or other class
or series of equity securities that the Corporation may issue, or any increase
in the amount of authorized shares of such class or series, in each case ranking
on parity with or junior to the Series D Preferred Stock with respect to payment
of dividends or the distribution of assets upon liquidation, dissolution or
winding up, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.

 

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(F) Exception to Required Consent. The voting rights provided for in this
Section 6(f)(ix) will not apply if, at or prior to the time when the act with
respect to which voting by holders of the Series D Preferred Stock would
otherwise be required pursuant to this Section 6(f)(ix) shall be effected, all
outstanding shares of Series D Preferred Stock shall have been redeemed or
called for redemption upon proper notice and sufficient funds shall have been
deposited in trust to effect such redemption pursuant to Section 6(f)(vi).

 

(G) No Other Voting Rights. Except as expressly stated in this Section 6(f)(ix)
or as may be required by applicable law, the Series D Preferred Stock will not
have any relative, participating, optional or other special voting rights or
powers and the consent of the holders thereof shall not be required for the
taking of any corporate action.

 

(x) Information Rights. During any period in which the Corporation is not
subject to Section 13 or 15(d) of the Exchange Act and any shares of Series D
Preferred Stock are outstanding, the Corporation will use its best efforts to
(i) transmit by mail (or other permissible means under the Exchange Act) to all
holders of Series D Preferred Stock, as their names and addresses appear on the
record books of the Corporation and without cost to such holders, copies of the
annual reports on Form 10-K and quarterly reports on Form 10-Q that the
Corporation would have been required to file with the Securities and Exchange
Commission (the “SEC”) pursuant to Section 13 or 15(d) of the Exchange Act if it
were subject thereto (other than any exhibits that would have been required);
and (ii) promptly, upon request, supply copies of such reports to any holders or
prospective holder of Series D Preferred Stock. The Corporation will use its
best efforts to mail (or otherwise provide) the information to the holders of
the Series D Preferred Stock within 15 days after the respective dates by which
a periodic report on Form 10-K or Form 10-Q, as the case may be, in respect of
such information would have been required to be filed with the SEC, if the
Corporation were subject to Section 13 or 15(d) of the Exchange Act, in each
case, based on the dates on which the Corporation would be required to file such
periodic reports if it were a “non-accelerated filer” within the meaning of the
Exchange Act.

 

(xi) No Preemptive Rights. No holders of the Series D Preferred Stock will, as
holders of Series D Preferred Stock, have any preemptive rights to purchase or
subscribe for Common Stock or any other security of the Corporation.

 

(xii) Record Holders. The Corporation and the transfer agent for the Series D
Preferred Stock may deem and treat the record holder of any Series D Preferred
Stock as the true and lawful owner thereof for all purposes, and neither the
Corporation nor the transfer agent shall be affected by any notice to the
contrary.

 

(xiii) Office or Agency. For so long as any shares of Series D Preferred Stock
are outstanding, the Corporation shall at all times maintain an office or agency
in one of the 48 contiguous states of the United States of America where shares
of Series D Preferred Stock may be surrendered for payment (including upon
redemption), registration of transfer or exchange.

 

(xiv) Certain Defined Terms. The definitions of terms which are included in this
Section 6(f) shall apply solely to this Section and not to any other Section of
this Charter. In the event of any conflict or inconsistency between a definition
included in this Section 6(f) and a definition of the same term elsewhere in
this Charter, the definition contained in this Section 6(f) shall control, but
solely for purposes of the interpretation and enforcement of this Section 6(f).

 

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