Unassociated Document


    EXHIBIT
      4.1

     

    ELEMENT
      21 GOLF COMPANY

     

    CERTIFICATE
      OF THE 

    POWERS,
      DESIGNATIONS, PREFERENCES AND RIGHTS OF THE

    SERIES
      A CONVERTIBLE PREFERRED STOCK, $.001 PAR VALUE PER SHARE 

     

    Of
      the
      5,000,000 shares of Preferred Stock authorized under the Certificate of
      Incorporation of Element 21 Golf Company (the “Corporation”), 2,200,000 shares
      are hereby designated as Series A Convertible Preferred Stock (the “Series A
      Preferred Stock”) with the voting powers, preferences and relative
      participating, optional or other special rights, and qualifications, limitations
      or restrictions as set forth below:

     

    Section
      1.    Definitions.

     

    For
      the
      purposes hereof, the following definitions shall apply:

     

    “Board
      of Directors”
shall
      mean the Board of Directors of this Corporation.

     

    “Conversion
      Price”
means
      the amount set forth in Section 4(a), as adjusted pursuant to Section
      5.

     

    “Junior
      Shares”
means
      all shares of Common Stock of this Corporation or any other stock ranking junior
      to the Series A Preferred Stock in dividends or liquidation rights.

     

    “Original
      Issue Date”
means
      the date on which a share of Series A Preferred Stock was first
      issued.

     

    “Original
      Issue Price”
      means
      $1.00.

     

    Section
      2.    Dividend
      Rights.

     

    The
      holders of the Series A Preferred Stock shall be entitled to receive dividends,
      out of any funds legally available therefor, when, and if, declared by the
      Board
      of Directors, in preference and priority to any payment of any dividend on
      any
      class or series of Junior Shares.

     

    Section
      3.    Liquidation
      Preference.

     

    (a) Preference. 
      In the event of any liquidation, dissolution or winding up of the affairs of
      the
      Corporation, voluntarily or involuntarily, the holders of each share of Series
      A
      Preferred Stock, prior to any distribution to the holders of Junior Shares,
      shall be entitled to receive pro rata a preferential amount equal to $1.00
      per
      share (adjusted to reflect any stock split, stock dividend, combination,
      recapitalization or reorganization) of Series A Preferred Stock held by them
      plus all declared but unpaid dividends (the “Series
      A Preferred Stock Liquidation Preference”). 
      If, upon such liquidation, dissolution or winding up, the assets of the
      Corporation are insufficient (after payment of the liquidation preference of
      any
      class of preferred stock ranking senior on liquidation to the Series A Preferred
      Stock) to provide for the payment of the Series A Preferred Stock Liquidation
      Preference for each share of Series A Preferred Stock outstanding, such assets
      as are available shall be paid out pro rata among the shares of Series A
      Preferred Stock and no payment shall be made to the holders of Junior Shares.
      After payment to the holders of the Series A Preferred Stock of the Series
      A
      Preferred Stock Liquidation Preference, the entire remaining assets and funds
      of
      the Corporation legally available for distribution, if any, shall be distributed
      among the holders of Junior Shares in proportion to the number of Junior Shares
      then held by them.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (b) Acquisition
      Treated as Liquidation. 
A
      merger or consolidation of the corporation with or into another corporation
      or
      entity (whether or not the corporation is the surviving entity if, after the
      merger or consolidation, more than 50% of the voting stock of the surviving
      corporation is owned by persons who were not holders of voting stock of this
      corporation prior to the merger or consolidation), or the sale of all or
      substantially all the assets of the Corporation, shall be deemed to be a
      liquidation, dissolution or winding up within the meaning of this Section
      3.

     

    Section
      4.    Conversion
      of Series A Preferred Stock.

     

    The
      holders of the Series A Preferred Stock shall have conversion rights in
      accordance with the following provisions:

     

    (a) Right
      to Convert and Conversion Price. 
      Each share of Series A Preferred Stock shall be convertible, at the option
      of
      the holder thereof, at any time after the Original Issue Date, at the office
      of
      the Corporation or any transfer agent for the Series A Preferred Stock, into
      such number of fully paid and non-assessable shares of Common Stock as is
      determined by dividing the Original Issue Price by the Conversion Price,
      determined and adjusted as hereafter provided, in effect at the time of
      conversion.  The initial “Conversion
      Price”
      shall be
      $0.255, and it shall be subject to adjustment as provided in Section 5.


     

    (b) Mechanics
      of Conversion. 
      No fractional shares of Common Stock shall be issued upon conversion of Series
      A
      Preferred Stock.  In lieu of any fractional share to which a holder of
      Series A Preferred Stock would otherwise be entitled, the Corporation shall
      pay
      cash equal to such fraction multiplied by the then effective Conversion
      Price.  Before any holder of Series A Preferred Stock shall be entitled to
      convert the same into full shares of Common Stock, the holder shall surrender
      the certificate or certificates therefor, duly endorsed for transfer, at the
      office of the Corporation or of any transfer agent for the Series A Preferred
      Stock, and shall give written notice to the Corporation at such office that
      he
      elects to convert the same.  The Corporation shall, as soon as practicable
      thereafter, issue and deliver at such office to such holder of Series A
      Preferred Stock a certificate or certificates for the number of shares of Common
      Stock to which he shall be entitled as aforesaid and a check payable to the
      holder in the amount of any cash amounts payable in order to avoid a conversion
      into fractional shares of Common Stock.  Such conversion shall be deemed to
      have been made immediately prior to the close of business on the date of such
      surrender of the shares of Series A Preferred Stock to be converted, and the
      person or persons entitled to receive the shares of Common Stock issuable upon
      such conversion shall be treated for all purposes as the record holder or
      holders of such shares of Common Stock on such date.

     

    
      
         

      

      
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    (c) Notices
      of Record Date, etc. 
      In the event that the Corporation shall propose at any time:

     

    (i) to
      declare any dividend or distribution upon its Common Stock, whether in cash,
      property, stock or other securities, whether or not a regular cash dividend
      and
      whether or not out of earnings or earned surplus;

     

    (ii) to
      offer
      for subscription pro rata to the holders of any class of its stock any
      additional shares of stock of any class or other rights;

     

    (iii) to
      subdivide or combine its outstanding Common Stock;

     

    (iv) to
      effect
      any reclassification or recapitaliza-tion of its Common Stock outstanding
      involving a change in the Common Stock; or

     

    (v) to
      merge
      or consolidate with or into any other corporation, or sell, lease or convey
      all
      or substantially all its property or business, or to liquidate, dissolve or
      wind
      up;

     

    then,
      in
      connection with each such event, the Corporation shall send to the holders
      of
      the Series A Preferred Stock:

     

    (1) 
      at least 10 days' prior written notice of the date on which a record shall
      be
      taken for such dividend, distribution, subscription rights, subdivision or
      combination (and specifying the date on which the holders of Common Stock shall
      be entitled thereto) or for determining rights to vote in respect of the matters
      referred to in clauses (iv) and (v) above; and

     

    (2) 
      in the case of the matters referred to in clauses (iv) and (v) above, at least
      10 days' prior written notice of the date when the same shall take place
      (specifying the date on which the holders of Common Stock shall be entitled
      to
      exchange their Common Stock for securities or other property deliverable upon
      the occurrence of such event).

     

    Each
      such
      written notice shall be given by certified mail, postage prepaid, addressed
      to
      the holders of Series A Preferred Stock at the address for each such holder
      as
      shown on the books of the Corporation.

     

    (d) Reservation
      of Common Stock. 
      The Corporation shall, at all times when the Series A Preferred Stock shall
      be
      outstanding, reserve and keep available out of its authorized but unissued
      stock, for the purpose of effecting the conversion of the Series A Preferred
      Stock, such number of its duly authorized shares of Common Stock as shall from
      time to time be sufficient to effect the conversion of all outstanding Series
      A
      Preferred Stock.  Before taking any action which would cause an adjustment
      reducing the Conversion Price below the then par value of the shares of Common
      Stock issuable upon conversion of the Series A Preferred Stock, the Corporation
      will take any corporate action which may, in the opinion of its counsel, be
      necessary in order that the Corporation may validly and legally issue fully
      paid
      and nonassessable shares of such Common Stock at such adjusted Conversion
      Price.

     

    
      
         

      

      
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    (e) Cancellation
      of Series A Preferred Stock. 
      All shares of Series A Preferred Stock which shall have been surrendered for
      conversion as herein provided shall no longer be deemed to be outstanding and
      all rights with respect to such shares, including the rights, if any, to receive
      notices and to vote, shall forthwith cease and terminate except only the right
      of the holders thereof to receive shares of Common Stock in exchange therefor
      and payment of any declared but unpaid dividends thereon.  Any shares of
      Series A Preferred Stock so converted shall be retired and cancelled, and shall
      not be reissued, and the Corporation may from time to time take such appropriate
      action as may be necessary to reduce the authorized Series A Preferred Stock
      accordingly.

     

    Section
      5.    Adjustment
      of Conversion Price on Series A Preferred Stock.

     

    (a) Adjustment
      for Combination or Consolidation of Common Stock. 
      In the event the outstanding shares of Common Stock shall be combined or
      consolidated, by reclassification or otherwise, into a lesser number of shares
      of Common Stock, the Conversion Price in effect immediately prior to such
      combination or consolidation shall, concurrently with the effectiveness of
      such
      combination or consolidation, be proportionately increased.

     

    (b) Adjustment
      for Stock Dividend or Subdivision. 
      In the event the Corporation at any time or from time to time after the Original
      Issue Date shall declare or pay any dividend on the Common Stock payable in
      Common Stock, or effect a subdivision of the outstanding shares of Common Stock
      into a greater number of shares of Common Stock by reclassification or otherwise
      than by payment of a dividend in Common Stock, then and in any such event,
      the
      Conversion Price in effect immediately prior to such subdivision or stock
      dividend shall forthwith be proportionately reduced.

     

    (c) Certificate
      as to Adjustments. 
      The Corporation shall, upon the written request at any time of any holder of
      Series A Preferred Stock, furnish or cause to be furnished to such holder a
      certificate setting forth (i) such adjustments and readjustments, (ii) the
      Conversion Price at the time in effect, and (iii) the number of shares of Common
      Stock and the amount, if any, of other property which at the time would be
      received upon the conversion of Series A Preferred Stock.

     

    Section
      6.    Voting
      Rights of Series A Preferred Stock.

     

    (a) General. 
      Except as expressly set forth in this Section and except as otherwise required
      by law, each share of Series A Preferred Stock issued and outstanding shall
      have
      the right to fifty (50) votes on all matters, and the holders of the Series
      A
      Preferred Stock shall vote with the Common Stock as a single class.

     

    (b) Matters
      Affecting Series A Preferred Stock. 
      So long as any Series A Preferred Stock shall be outstanding, the Corporation
      shall not, without first obtaining the affirmative vote or written consent
      of
      the holders of not less than a majority of the outstanding shares of Series
      A
      Preferred Stock amend or repeal any provision of, or add any provision to,
      the
      Corporation's Certificate of Incorporation or By-laws if such action would
      alter
      or change the preferences, rights, privileges or powers of, or the restrictions
      provided for the benefit of, such Series A Preferred Stock.

     

    
      
         

      

      
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    IN
      WITNESS WHEREOF, the undersigned has executed this Certificate of Designations
      as of February 22, 2006.

     

    


    
      	 	 	ELEMENT 21 GOLF COMPANY 
	 	 	 
	 	 	By: /s/ Nataliya Hearn
	 	 	Name: Nataliya Hearn
	 	 	Title:
              President


    

     

    
      
         

      

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