exv4w8



 





Exhibit 4.8




CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS




OF




SERIES C CONVERTIBLE PREFERRED STOCK




OF




UTIX GROUP, INC.




(Pursuant to Section 151 of the

Delaware General Corporation Law)




          UTIX Group, Inc., a corporation organized and existing under the laws of the State of Delaware
(the “Company”), hereby certifies that, pursuant to authority vested in the Board of Directors of
the Company by Article FOURTH of the Amended and Restated Certificate of Incorporation of the
Company, the following resolution was adopted as of September ___, 2007 by the Board of Directors of
the Company pursuant to Section 151 of the Delaware General Corporation Law:




          “RESOLVED that, pursuant to authority vested in the Board of Directors of the Company by
Article FOURTH of the Company’s Amended and Restated Certificate of Incorporation, out of the total
authorized number of 25,000,000 shares of its preferred stock, par value $0.001 per share
(“Preferred Stock”), there shall be designated a series of Six Million One Hundred Fifty-Three
Thousand Eight Hundred and Fourty-Six (6,153,846) shares which shall be issued in and constitute a
single series to be known as “Series C Convertible Preferred Stock” (hereinafter called the “Series
C Preferred Stock”). The shares of Series C Preferred Stock have the voting powers, designations,
preferences and other special rights, and qualifications, limitations and restrictions thereof set
forth below:




          1. Certain Definitions.




          As used in this Certificate of Designations, Preferences and Rights of Series C Convertible
Preferred Stock of UTIX Group, Inc., the following terms shall have the respective meanings set
forth below:




          “Affiliate”, as applied to any Person, means any other Person directly or indirectly
controlling, controlled by, or under common control with, that Person. For the purposes of this
definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled
by” and “under common control with”), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by contract or otherwise.














 








          “Common Stock” means the common stock, $0.001 par value per share, of the Company,
including the stock into which the Series C Preferred Stock is convertible, and any securities into
which the Common Stock may be reclassified.




          “Conversion Shares” means the shares of Common Stock into which the Series C Preferred
Stock is convertible.




          “Excluded Stock” means (A) capital stock, Options (as defined in Section 4D(1)) or
Convertible Securities (as defined in Section 4D(1)) issued to employees, consultants, officers or
directors of the Company pursuant to any stock or option plan duly adopted by a majority of the
non-employee members of the Board of Directors of the Company or a majority of the members of a
committee of non-employee directors established for such purpose, (B) shares of Common Stock issued
upon the conversion or exercise of Options or Convertible Securities issued prior to the date
hereof, provided that such securities have not been amended since the date hereof to increase the
number of shares of Common Stock issuable thereunder or to lower the exercise or conversion price
thereof, (C) securities issued pursuant to that certain Purchase Agreement dated September ___,
2007, among the Company and the Investors named therein (the “Purchase Agreement”) and securities
issued upon the exercise or conversion of those securities, and (D) shares of Common Stock issued
or issuable by reason of a dividend, stock split or other distribution on shares of Common Stock
(but only to the extent that such a dividend, split or distribution results in an adjustment in the
Conversion Price pursuant to the other provisions of this Series C Preferred Stock).




          “Person” shall be construed in the broadest sense and means and includes any natural
person, a partnership, a corporation, an association, a joint stock company, a limited liability
company, a trust, a joint venture, an unincorporated organization and other entity or governmental
or quasi-governmental entity.




          “Series C Stated Value” means $0.65.




          “Subsidiary” means any corporation, association or other business entity (i) at least
50% of the outstanding voting securities of which are at the time owned or controlled, directly or
indirectly, by the Company; or (ii) with respect to which the Company possesses, directly or
indirectly, the power to direct or cause the direction of the affairs or management of such person;




          2. Dividends. Dividends on the Series C Preferred Stock shall be declared and paid
from time to time as determined by the Company’s Board of Directors out of funds legally available
therefor. The Company shall not declare, pay or set aside any dividends or distributions on shares
of Common Stock (other than dividends payable solely in shares of Common Stock), unless the holders
of Series C Preferred Stock first receive, or simultaneously receive, a dividend or distribution on
each outstanding share of Series C Preferred Stock equal to the product of (i) the per share
dividend or distribution to be declared, paid or set aside for the Common Stock, multiplied by (ii)
the number of shares of Common Stock into which such share of Series C Preferred Stock is then
convertible.




          3. Liquidation. Upon any liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary, the holders of the shares of Series C Preferred Stock




 









 







shall be entitled, before any distributions shall be made to the holders of the Common Stock, or any other
class or series of capital stock of the Company ranking junior to the Series C Preferred Stock as
to such distributions, to be paid an amount per share equal to the Series C Stated Value plus any
accrued and unpaid Series C Preferred Dividends (the “Liquidation Preference”). If upon such
liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the assets
to be distributed among the holders of the Series C Preferred Stock and any class or series of
capital stock ranking on a parity with the Series C Preferred Stock as to such distributions shall
be insufficient to permit payment to the holders of the Series C Preferred Stock and any such class
or series of capital stock of their respective liquidation amount, then the entire assets of the
Company to be distributed shall be distributed pro rata to the holders of Series C Preferred Stock
and the holders of such class or series of capital stock ranking on a parity with the Series C
Preferred Stock as to such distributions according to the preferential amounts due thereon. Unless
waived in writing by the holders of at least a majority of the Series C Preferred Stock then
outstanding, voting together as one class, a consolidation or merger of the Company into or with
any other entity or entities, a share exchange, a sale of Common Stock or the sale or transfer by
the Company of all or substantially all of its assets, in each case under circumstances in which
the holders of a majority in voting power of the outstanding capital stock of the Company,
immediately prior to such a merger, consolidation, share exchange or sale, own less than a majority
in voting power of the outstanding capital stock of the corporation or the surviving or resulting
corporation or acquirer, as the case may be, immediately following such a merger, consolidation,
share exchange or sale (each such transaction being hereinafter referred to as a “Corporate
Transaction”) shall be deemed to be a liquidation within the meaning of this Section 3.




          4. Conversion.




          4A. Right to Convert.





     (a) Subject to the terms and conditions of this paragraph 4A, the holder of any share
or shares of Series C Preferred Stock shall have the right, at its option at any time, to
convert any such shares of Series C Preferred Stock into such number of fully paid and
nonassessable whole shares of Common Stock as is obtained by multiplying the number of
shares of Series C Preferred Stock so to be converted by the Liquidation Preference per
share and dividing the result by the conversion price of $0.65 per share or, if there has
been an adjustment of the conversion price, by the conversion price as last adjusted and in
effect at the date any share or shares of Series C Preferred Stock are surrendered for
conversion (such price, or such price as last adjusted, being referred to herein as the
“Conversion Price”). Such rights of conversion shall be exercised by the holder thereof by
surrender of a certificate or certificates for the shares to be converted to the Company at
its principal office (or such other office or agency of the Company as the Company may
designate by notice in writing to the holder or holders of the Series C Preferred Stock) at
any time during its usual business hours on the date set forth in such notice, together with
a properly completed notice of conversion in the form attached to the Series C Preferred
Stock certificate with a statement of the name or names (with address), subject to
compliance with applicable laws to the extent such designation shall involve a transfer, in which the certificate or certificates for
shares of Common Stock, shall be issued. Such conversion shall be deemed to have been
effected and the Conversion Price shall be determined as of the close of business on the
date



 









 






on which such written notice shall have been received by the Company and the
certificate or certificates for such shares shall have been surrendered as aforesaid.




     (b) To the extent permitted by applicable law and the listing requirements of any stock
market or exchange on which the Common Stock is then listed, the Company from time to time
may decrease the Conversion Price by any amount for any period of time if the period is at
least twenty (20) days, the decrease is irrevocable during the period and the Board shall
have made a determination that such decrease would be in the best interests of the Company,
which determination shall be conclusive. Whenever the Conversion Price is decreased
pursuant to the preceding sentence, the Company shall provide written notice thereof to the
holders of the Series C Preferred Stock at least five (5) days prior to the date the
decreased Conversion Price takes effect, and such notice shall state the decreased
Conversion Price and the period during which it will be in effect.




     4B. Issuance of Certificates; Time Conversion Effected. Promptly after the
conversion of the Series C Preferred Stock and surrender of the certificate or certificates
for the share or shares of the Series C Preferred Stock being converted, the Company shall
issue and deliver, or cause to be issued and delivered, to the holder, registered in such
name or names as such holder may direct, subject to compliance with applicable laws to the
extent such designation shall involve a transfer, a certificate or certificates for the
number of whole shares of Common Stock issuable upon the conversion of such share or shares
of Series C Preferred Stock. Upon the effective date of any such conversion, the rights of
the holder of the shares of Series C Preferred Stock being converted shall cease, and the
person or persons in whose name or names any certificate or certificates for shares of
Common Stock shall be issuable upon such conversion shall be deemed to have become the
holder or holders of record of the shares represented thereby.




     4C. Fractional Shares; Dividends. No fractional shares shall be issued upon
conversion of the Series C Preferred Stock into Common Stock. In lieu of any fractional
share interest, the Company shall pay to the converting holder an amount equal to such
fractional interest multiplied by the Market Price of a share of Common Stock on the date
such conversion is deemed to be effective..


4D. Adjustment of Conversion Price. If the Company shall issue or sell, or is, in
accordance with any of subsections 4D(1) through 4D(7) hereof, deemed to have issued or sold, any
Additional Shares of Common Stock for no consideration or for a consideration per share less than
the Conversion Price in effect immediately prior to the time of such issue or sale, then and in
each such case (a “Trigger Issuance”) the then-existing Conversion Price, shall be reduced,
as of the close of business on the effective date of the Trigger Issuance, to a price determined as
follows:




	 	 	 	 	 
	 

	 	Adjusted Conversion Price =
	 	(A x B) + D
	 

	 	 	 	A+C






                    where



 









 





                    “A” equals the number of shares of Common Stock outstanding, including Additional Shares of
Common Stock (as defined below) deemed to be issued hereunder, immediately preceding such Trigger
Issuance;



                    “B” equals the Conversion Price in effect immediately preceding such Trigger Issuance;



                    “C” equals the number of Additional Shares of Common Stock issued or deemed issued hereunder
as a result of the Trigger Issuance; and



                    “D” equals the aggregate consideration, if any, received or deemed to be received by the
Company upon such Trigger Issuance;


provided, however, that in no event shall the Conversion Price after giving effect to such Trigger
Issuance be greater than the Conversion Price in effect prior to such Trigger Issuance.




          For purposes of this subsection 4D, “Additional Shares of Common Stock” shall mean all shares
of Common Stock issued by the Company or deemed to be issued pursuant to this subsection 4D, other
than Excluded Stock.




          For purposes of this subsection 4D, the following paragraphs 4D(1) to 4D(7) shall also be
applicable:





     4D(1) Issuance of Rights or Options. In case at any time the Company shall in
any manner grant (directly and not by assumption in a merger or otherwise) any warrants or
other rights to subscribe for or to purchase, or any options for the purchase of, Common
Stock or any stock or security convertible into or exchangeable for Common Stock (such
warrants, rights or options being called “Options” and such convertible or exchangeable
stock or securities being called “Convertible Securities”) whether or not such Options or
the right to convert or exchange any such Convertible Securities are immediately
exercisable, and the price per share for which Common Stock is issuable upon the exercise of
such Options or upon the conversion or exchange of such Convertible Securities (determined
by dividing (i) the sum (which sum shall constitute the applicable consideration) of (x) the
total amount, if any, received or receivable by the Company as consideration for the
granting of such Options, plus (y) the aggregate amount of additional consideration payable
to the Company upon the exercise of all such Options, plus (z), in the case of such Options
which relate to Convertible Securities, the aggregate amount of additional consideration, if
any, payable upon the issue or sale of such Convertible Securities and upon the conversion
or exchange thereof, by (ii) the total maximum number of shares of Common Stock issuable
upon the exercise of such Options or upon the conversion or exchange of all such Convertible
Securities issuable upon the exercise of such Options) shall be less than the Conversion
Price in effect immediately prior to the time of the granting of such Options, then the total
number of shares of Common Stock issuable upon the exercise of such Options or upon
conversion or exchange of the total amount of such Convertible Securities issuable upon the
exercise of such Options shall be deemed to have been issued for such price per share as of
the date of granting of such Options or the issuance of such Convertible Securities and
thereafter shall



 









 






be deemed to be outstanding for purposes of adjusting the Conversion Price.
Except as otherwise provided in subsection 4D(3), no adjustment of the Conversion Price
shall be made upon the actual issue of such Common Stock or of such Convertible Securities
upon exercise of such Options or upon the actual issue of such Common Stock upon conversion
or exchange of such Convertible Securities.




     4D(2) Issuance of Convertible Securities. In case the Company shall in any
manner issue (directly and not by assumption in a merger or otherwise) or sell any
Convertible Securities, whether or not the rights to exchange or convert any such
Convertible Securities are immediately exercisable, and the price per share for which Common
Stock is issuable upon such conversion or exchange (determined by dividing (i) the sum
(which sum shall constitute the applicable consideration) of (x) the total amount received
or receivable by the Company as consideration for the issue or sale of such Convertible
Securities, plus (y) the aggregate amount of additional consideration, if any, payable to
the Company upon the conversion or exchange thereof, by (ii) the total number of shares of
Common Stock issuable upon the conversion or exchange of all such Convertible Securities)
shall be less than the Conversion Price in effect immediately prior to the time of such
issue or sale, then the total maximum number of shares of Common Stock issuable upon
conversion or exchange of all such Convertible Securities shall be deemed to have been
issued for such price per share as of the date of the issue or sale of such Convertible
Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the
Conversion Price, provided that (a) except as otherwise provided in subsection 4D(3), no
adjustment of the Conversion Price shall be made upon the actual issuance of such Common
Stock upon conversion or exchange of such Convertible Securities and (b) no further
adjustment of the Conversion Price shall be made by reason of the issue or sale of
Convertible Securities upon exercise of any Options to purchase any such Convertible
Securities for which adjustments of the Conversion Price have been made pursuant to the
other provisions of subsection 4D.




     4D(3) Change in Option Price or Conversion Rate. Upon the happening of any of
the following events, namely, if the purchase price provided for in any Option referred to
in subsection 4D(l) hereof, the additional consideration, if any, payable upon the
conversion or exchange of any Convertible Securities referred to in subsections 4D(l) or
4D(2), or the rate at which Convertible Securities referred to in subsections 4D(l) or 4D(2)
are convertible into or exchangeable for Common Stock shall change at any time (including,
but not limited to, changes under or by reason of provisions designed to protect against
dilution), the Conversion Price in effect at the time of such event shall forthwith be
readjusted to the Conversion Price which would have been in effect at such time had such
Options or Convertible Securities still outstanding provided for such changed purchase
price, additional consideration or conversion rate, as the case may be, at the time
initially granted, issued or sold. On the termination of any Option for which any
adjustment was made pursuant to this subsection 4(D) or any right to convert or exchange Convertible Securities for which
any adjustment was made pursuant to this subsection 4(D) (including without limitation upon
the redemption or purchase for consideration of such Convertible Securities by the Company),
the Conversion Price then in effect hereunder shall forthwith be changed to the Conversion
Price which would have been in effect at the time of such termination had such Option or
Convertible Securities, to the extent outstanding immediately prior to such termination,



 









 






never been issued.




     4D(4) Stock Dividends. Subject to the provisions of this subsection 4D, in
case the Company shall declare or pay a dividend or make any other distribution upon any
stock of the Company (other than the Common Stock) payable in Common Stock, Options or
Convertible Securities, then any Common Stock, Options or Convertible Securities, as the
case may be, issuable in payment of such dividend or distribution shall be deemed to have
been issued or sold without consideration.




     4D(5) Consideration for Stock. In case any shares of Common Stock, Options or
Convertible Securities shall be issued or sold for cash, the consideration received therefor
shall be deemed to be the net amount received by the Company therefor, after deduction
therefrom of any expenses incurred or any underwriting commissions or concessions paid or
allowed by the Company in connection therewith. In case any shares of Common Stock, Options
or Convertible Securities shall be issued or sold for a consideration other than cash, the
amount of the consideration other than cash received by the Company shall be deemed to be
the fair value of such consideration as determined in good faith by the Board of Directors
of the Company, after deduction of any expenses incurred or any underwriting commissions or
concessions paid or allowed by the Company in connection therewith. In case any Options
shall be issued in connection with the issue and sale of other securities of the Company,
together comprising one integral transaction in which no specific consideration is allocated
to such Options by the parties thereto, such Options shall be deemed to have been issued for
such consideration as determined in good faith by the Board of Directors of the Company. If
Common Stock, Options or Convertible Securities shall be issued or sold by the Company and,
in connection therewith, other Options or Convertible Securities (the “Additional Rights”)
are issued, then the consideration received or deemed to be received by the Company shall be
reduced by the fair market value of the Additional Rights (as determined using the
Black-Scholes option pricing model or another method mutually agreed to by the Company and
the holder). The Board of Directors of the Company shall respond promptly, in writing, to
an inquiry by the holder as to the fair market value of the Additional Rights. In the event
that the Board of Directors of the Company and the holder are unable to agree upon the fair
market value of the Additional Rights, the Company and the holder shall jointly select an
appraiser, who is experienced in such matters. The decision of such appraiser shall be
final and conclusive, and the cost of such appraiser shall be borne evenly by the Company
and the holder.




     4D(6) Record Date. In case the Company shall take a record of the holders of
its Common Stock for the purpose of entitling them (i) to receive a dividend or other
distribution payable in Common Stock, Options or Convertible Securities or (ii) to subscribe
for or purchase Common Stock, Options or Convertible Securities, then such record date
shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to
have been issued or sold upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription or purchase, as the
case may be.




     4D(7) Treasury Shares. The number of shares of Common Stock outstanding at
any



 









 






given time shall not include shares owned or held by or for the account of the Company
or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than
the cancellation or retirement thereof) shall be considered an issue or sale of Common Stock
for the purpose of this Section 4D.




     4E Stock Splits and Dividends. If the Company shall, at any time or from time
to time while the Series C Preferred Stock is outstanding, pay a dividend or make a
distribution on its Common Stock in shares of Common Stock, subdivide its outstanding shares
of Common Stock into a greater number of shares or combine its outstanding shares of Common
Stock into a smaller number of shares or issue by reclassification of its outstanding shares
of Common Stock any shares of its capital stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
corporation), then the Conversion Price in effect immediately prior to the date upon which
such change shall become effective shall be adjusted by multiplying such Conversion Price by
a fraction, the numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such change and the denominator of which shall be the number of shares
of Common Stock outstanding immediately after giving effect to such change and. Such
adjustment shall be made successively whenever any event listed above shall occur.




     4F. Reorganization or Reclassification. If any capital reorganization or
reclassification of the capital stock of the Company, consolidation or merger of the Company
with another corporation in which the Company is not the survivor, or sale, transfer or
other disposition of all or substantially all of the Company’s assets to another corporation
shall be effected, then, as a condition of such reorganization or reclassification,
consolidation, merger, sale, transfer or other disposition, lawful and adequate provision
shall be made whereby each holder of a share or shares of Series C Preferred Stock shall
thereafter have the right to receive, upon the basis and upon the terms and conditions
specified herein and in lieu of the Conversion Shares immediately theretofore receivable
upon the conversion of such share or shares of the Series C Preferred Stock, such shares of
stock, securities or assets as would have been issuable or payable with respect to or in
exchange for a number of Conversion Shares equal to the number of Conversion Shares
immediately theretofore issuable upon conversion of the Series C Preferred Stock, had such
reorganization, reclassification, consolidation, merger, sale, transfer or other disposition
not taken place, and in any such case appropriate provision shall be made with respect to
the rights and interests of such holder to the end that the provisions hereof (including
without limitation provisions for adjustment of the Conversion Price) shall thereafter be
applicable, as nearly equivalent as may be practicable in relation to any shares of stock,
securities or assets thereafter deliverable upon the exercise of such conversion rights. The Company shall not effect any such
consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously
with the consummation thereof the successor corporation (if other than the Company)
resulting from such consolidation or merger, or the corporation purchasing or otherwise
acquiring such assets or other appropriate corporation or entity shall assume the obligation
to deliver to the holders of the Series C Preferred Stock, at the last addresses of such
holders appearing on the books of the Company, such shares of stock, securities or assets
as, in accordance with the foregoing provisions, such holders may be entitled to



 









 






receive, and the other obligations hereunder. The provisions of this subsection 4F shall similarly
apply to successive reorganizations, reclassifications, consolidations, mergers, sales,
transfers or other dispositions.




     4G. Distributions. In case the Company shall fix a payment date for the making
of a distribution to all holders of Common Stock (including any such distribution made in
connection with a consolidation or merger in which the Company is the continuing
corporation) of evidences of indebtedness or assets (other than cash dividends or cash
distributions payable out of consolidated earnings or earned surplus or dividends or
distributions referred to in Section 4E), or subscription rights or warrants, the Conversion
Price to be in effect after such payment date shall be determined by multiplying the
Conversion Price in effect immediately prior to such payment date by a fraction, the
numerator of which shall be the total number of shares of Common Stock outstanding
multiplied by the Market Price (as defined below) per share of Common Stock immediately
prior to such payment date, less the fair market value (as determined by the Company’s Board
of Directors in good faith) of said assets or evidences of indebtedness so distributed, or
of such subscription rights or warrants, and the denominator of which shall be the total
number of shares of Common Stock outstanding multiplied by such Market Price per share of
Common Stock immediately prior to such payment date. “Market Price” as of a particular date
(the “Valuation Date”) shall mean the following: (a) if the Common Stock is then listed on a
national stock exchange, the closing sale price of one share of Common Stock on such
exchange on the last trading day prior to the Valuation Date; (b) if the Common Stock is
then quoted on The Nasdaq Stock Market, Inc. (“Nasdaq”), the National Association of
Securities Dealers, Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar quotation
system or association, the closing sale price of one share of Common Stock on Nasdaq, the
Bulletin Board or such other quotation system or association on the last trading day prior
to the Valuation Date or, if no such closing sale price is available, the average of the
high bid and the low asked price quoted thereon on the last trading day prior to the
Valuation Date; or (c) if the Common Stock is not then listed on a national stock exchange
or quoted on Nasdaq, the Bulletin Board or such other quotation system or association, the
fair market value of one share of Common Stock as of the Valuation Date, as determined in
good faith by the Board of Directors of the Company and the holders of at least a majority
of the outstanding Series C Preferred Stock. If the Common Stock is not then listed on a
national securities exchange, Nasdaq, the Bulletin Board or such other quotation system or
association, the Board of Directors of the Company shall respond promptly, in writing, to an
inquiry by a holder of Series C Preferred Stock prior to the conversion of Series C
Preferred Stock hereunder as to the fair market value of a share of Common Stock as
determined by the Board of Directors of the Company. In the event that the Board of Directors of the Company and the holders
of at least a majority of the outstanding Series C Preferred Stock are unable to agree upon
the fair market value in respect of subpart (c) hereof, the Company and the holders of at
least a majority of the outstanding Series C Preferred Stock shall jointly select an
appraiser, who is experienced in such matters. The decision of such appraiser shall be
final and conclusive, and the cost of such appraiser shall be borne equally by the Company
and such holders. Such adjustment shall be made successively whenever such a payment date
is fixed.




     4H. Effective Date of Adjustment. An adjustment to the Conversion Price shall



 









 






become effective immediately after the payment date in the case of each dividend or
distribution and immediately after the effective date of each other event which requires an
adjustment.




     4I. Subsequent Adjustments. In the event that, as a result of an adjustment
made pursuant to this Section 4, holders of Series C Preferred Stock shall become entitled
to receive any shares of capital stock of the Company other than shares of Common Stock, the
number of such other shares so receivable upon the conversion of the Series C Preferred
Stock shall be subject thereafter to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the Conversion Shares
contained herein.




     4J. Notice of Adjustment. Upon any adjustment of the Conversion Price, then,
and in each such case the Company shall give written notice thereof by first class mail,
postage prepaid, addressed to each holder of shares of Series C Preferred Stock at the
address of such holder as shown on the books of the Company, which notice shall state the
Conversion Price resulting from such adjustment, setting forth in reasonable detail the
method of calculation and the facts upon which such calculation is based.




     4K. Other Notices. In case at any time:




          (1) the Company shall declare any dividend upon its Common Stock payable in cash or
stock or make any other distribution to the holders of its Common Stock;




          (2) the Company shall offer for subscription pro rata to the holders of
its Common Stock any additional shares of such stock of any class or other rights;




          (3) there shall be any capital reorganization or reclassification of the capital stock
of the Company, or a consolidation or merger of the Company with, or a sale of all or
substantially all its assets to, another corporation; or




          (4) there shall be a voluntary or involuntary dissolution, liquidation or winding up of
the Company;




then, in any one or more of said cases, the Company shall give, by first class mail, postage
prepaid, addressed to each holder of any shares of Series C Preferred Stock at the address
of such holder as shown on the books of the Company, (a) at least 15 days prior written notice
of the date on which the books of the Company shall close or a record shall be taken for
such dividend, distribution or subscription rights or for determining rights to vote in
respect of any such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, and (b) in the case of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at
least 15 days prior written notice of the date when the same shall take place. Such notice
in accordance with the foregoing clause (a) shall also specify, in the case of any such
dividend, distribution or subscription rights, the date on which the holders of Common Stock
shall be entitled thereto, and such notice in accordance with the foregoing clause (b) shall
also specify the date on which the holders of



 









 






Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as
the case may be.



          4L. Stock to be Reserved.





          (1) The Company will at all times reserve and keep available out of its authorized but
unissued Common Stock solely for the purpose of issuance upon the conversion of the Series C
Preferred Stock as herein provided, such number of shares of Common Stock as shall then be
issuable upon the conversion of all outstanding shares of Series C Preferred Stock. All
shares of Common Stock which shall be so issued shall be duly and validly issued and fully
paid and nonassessable and free from all liens, duties and charges arising out of or by
reason of the issue thereof (including, without limitation, in respect of taxes) and,
without limiting the generality of the foregoing, the Company covenants that it will from
time to time take all such action as may be requisite to assure that the par value per share
of the Common Stock is at all times equal to or less than the effective Conversion Price.
The Company will take all such action within its control as may be necessary on its part to
assure that all such shares of Common Stock may be so issued without violation of any
applicable law or regulation, or of any requirements of any national securities exchange
upon which the Common Stock of the Company may be listed. The Company will not take any
action which results in any adjustment of the Conversion Price if after such action the
total number of shares of Common Stock issued and outstanding and thereafter issuable upon
exercise of all options and conversion of Convertible Securities, including upon conversion
of the Series C Preferred Stock, would exceed the total number of shares of such class of
Common Stock then authorized by the Company’s Amended and Restated Certificate of
Incorporation.




          (2) The Company will at all times reserve and keep available out of its authorized
Series C Preferred Stock such number of shares of Series C Preferred Stock as is equal to
the number of shares of Series C Preferred Stock then outstanding. All shares of Series C
Preferred Stock which shall be so issued shall be duly and validly issued and fully paid and
nonassessable and free from all liens, duties and charges arising out of or by reason of the
issue thereof (including, without limitation, in respect of taxes).




     4M. No Reissuance of Series C Preferred Stock. Shares of Series C Preferred
Stock that are converted into shares of Common Stock as provided herein shall be retired and
may not be reissued as Series C Preferred Stock but may be reissued as all or part of
another series of Preferred Stock.




     4N. Issue Tax. The issuance of certificates for shares of Common Stock upon
conversion of the Series C Preferred Stock shall be made without charge to the holders
thereof for any issuance tax, stamp tax, transfer tax, duty or charge in respect thereof,
provided that the Company shall not be required to pay any tax, duty or charge which may be
payable in respect of any transfer involved in the issuance and delivery of any certificate
in a name other than that of the holder of the Series C Preferred Stock which is being
converted.



 









 






     4O. Closing of Books. The Company will at no time close its transfer books
against the transfer of any Series C Preferred Stock or of any shares of Common Stock issued
or issuable upon the conversion of any shares of Series C Preferred Stock in any manner
which interferes with the timely conversion of such Series C Preferred Stock;
provided, however, nothing herein shall be construed to prevent the Company
from setting record dates for the holders of its securities.



          5. Voting — Series C Preferred Stock. In addition to any class voting rights provided
by law and this Certificate of Designation, the holders of Series C Preferred Stock shall have the
right to vote together with the holders of Common Stock as a single class on any matter on which
the holders of Common Stock are entitled to vote (including the election of directors). With
respect to the voting rights of the holders of the Series C Preferred Stock pursuant to the
preceding sentence, each holder of Series C Preferred Stock shall be entitled to one vote for each
share of Common Stock that would be issuable to such holder upon the conversion of all the shares
of Series C Preferred Stock held by such holder on the record date for the determination of
shareholders entitled to vote.




          6. Certain Restrictions. In addition to any other vote of the holders of Series C
Preferred Stock required by law or by the Amended and Restated Certificate of Incorporation,
without the prior consent of the holders of at least a majority of the outstanding Series C
Preferred Stock, given in person or by proxy, either in writing or at a special meeting called for
that purpose, at which meeting the holders of the shares of such Series C Preferred Stock shall
vote together as a class, the Company will not:





          (a) authorize, create, designate, establish or issue (whether by merger or otherwise)
(i) an increased number of shares of Series C Preferred Stock, or (ii) any other class or
series of capital stock ranking senior to or on parity with the Series C Preferred Stock as
to dividends or upon liquidation or reclassify any shares of Common Stock into shares having
any preference or priority as to dividends or upon liquidation superior to or on parity with
any such preference or priority of Series C Preferred Stock;




          (b) authorize, create, designate, establish or issue (whether by merger or otherwise)
any shares of capital stock or any Options or Convertible Securities or amend or
waive any of the terms or provisions of any outstanding capital stock, Options or
Convertible Securities;




          (c) enter into or consummate any Corporate Transaction;




          (d) incur, assume or suffer to exist any indebtedness for borrowed money in excess of
$500,000 in the aggregate;




          (e) amend, alter or repeal, whether by merger, consolidation or otherwise, the Amended
and Restated Certificate of Incorporation or By-laws of the Company or the Resolutions
contained in this Certificate of Designations of the Series C Preferred Stock and the
powers, preferences, privileges, relative, participating, optional and other special rights



 









 






and qualifications, limitations and restrictions thereof, which would adversely affect any
right, preference, privilege or voting power of the Series C Preferred Stock, or which would
increase or decrease the amount of authorized shares of the Series C Preferred Stock or of
any other series of preferred stock ranking senior to the Series C Preferred Stock, with
respect to the payment of dividends (whether or not such series of preferred stock is
cumulative or noncumulative as to payment of dividends) or upon liquidation;




          (f) directly or indirectly, declare or pay any dividend (other than dividends permitted
pursuant to Section 2 and dividends payable in shares of Common Stock but only to the extent
that such stock dividend results in an adjustment of the Conversion Price pursuant to
Section 4(D)(4)) or directly or indirectly purchase, redeem, repurchase or otherwise acquire
or permit any Subsidiary to redeem, purchase, repurchase or otherwise acquire (or make any
payment to a sinking fund for such redemption, purchase, repurchase or other acquisition)
any share of Common Stock or any other class or series of the Company’s capital stock
(except for shares of Common Stock repurchased from current of former employees,
consultants, or directors upon termination of service in accordance with plans approved by
the Company’s Board of Directors) whether in cash, securities or property or in obligations
of the Company or any Subsidiary; or




          (g) agree to do any of the foregoing.



          7. No Waiver. Except as otherwise modified or provided for herein, the holders of
Series C Preferred Stock shall also be entitled to, and shall not be deemed to have waived, any
other applicable rights granted to such holders under the Delaware General Corporation Law.




          8. No Impairment. The Company will not, through any reorganization, transfer of
assets, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms to be observed or performed
hereunder by the Company but will at all time in good faith assist in the carrying out of all the
provisions of this Article FOURTH and in the taking of all such action as may be necessary or
appropriate in order to protect the conversion rights and liquidation preferences granted hereunder
of the holders of the Series C Preferred Stock against impairment.”




          9. Amendment; Waiver. Any term of the Series C Preferred Stock may be amended or
waived (including the adjustment provisions included in Section 4(D) hereof) upon the written
consent of the Company and the holders of at least a majority of the Series C Preferred Stock then
outstanding, voting together as a single class; provided, however that the number
of Conversion Shares issuable hereunder and the Conversion Price may not be amended, and the right
to convert the Series C Preferred Stock may not be altered or waived, without the written consent
of the holders of all of the Series C Preferred Stock then outstanding.




          10. Action By Holders. Any action or consent to be taken or given by the holders of
the Series C Preferred Stock may be given either at a meeting of the holders of the Series C
Preferred Stock called and held for such purpose or by written consent.




[Execution Page Follows]




 









 








          IN WITNESS WHEREOF, the undersigned has executed Certificate of Designations, Preferences and
Rights this 24th day of September, 2007.




	 	 	 	 	 
	 	UTIX GROUP, INC.

 	 
	 	By:  	/s/ Anthony G. Roth
 	 
	 	 	Name:  	Anthony G. Roth 	 
	 	 	Title:  	President and Chief Executive