**Exhibit 3.4**

 

**CERTIFICATE OFDESIGNATIONOF SERIES B PREFERRED STOCKOFAMERICAN MEDICAL TECHNOLOGIES, INC.**

 

AmericanMedical Technologies, Inc., a corporation organized and existing under the lawsof the State of Delaware, the Certificate of Incorporation of which was filedin the office of the Secretary of State of Delaware on November 21, 1989 underthe name ADL Consolidated, Inc. (the “Corporation”), in accordance with theprovisions of Section 151(g) of the General Corporation Law of the State ofDelaware, does by its President hereby certify as follows:

 

That pursuantto the authority conferred upon the Board of Directors by the First RestatedCertificate of Incorporation of the Corporation, the Board of Directors onAugust 24, 2002 adopted the following resolutions creating a second series of575,000 shares of preferred stock designated as Series B Preferred Stock:

 

RESOLVED, thatpursuant to the authority granted to the Board of Directors by ARTICLE FOURTHof the Restated Certificate of Incorporation of the Corporation, as amended(the “Certificate”), the Board of Directors does hereby provide for issuance ofa series of preferred stock, $.01 par value, of the Corporation, to bedesignated “Series B Preferred Stock”, which shall have, in addition to theterms set forth in the Certificate, the following designations, powers,preferences and relative and other special rights and the qualifications,limitations and restrictions as follows:

 

Section1.  Designation and Amount.  There shall be a series of preferred stock,$.01 par value, of the Corporation designated as “Series B Preferred Stock”,and the number of shares constituting such series shall be 575,000 shares.

 

Section2.  Dividends and Distributions.  The holders of Series B Preferred Stockshall be entitled to receive a dividend at the rate of ten percent (10%) perannum on its paid in capital, payable each year on a date to be specified bythe Board of Directors.   The dividendsaccrue from the date of issuance of the Series B Preferred Stock and shall bedeemed to accrue whether or not earned or declared.  The right to these dividends is cumulative; and those currentlydue as well as all those past due must be declared and set aside or fully paidbefore any distribution, by dividend or otherwise, is paid on, declared, or setapart for the holders of any shares of common stock.  After the cumulative dividends on the Series B Preferred Stockhave been paid in full, any further distribution of dividends shall be madeequally to the holders of all outstanding shares of common stock.

 

Section3.  Voting Rights.  On all matters submitted to a vote of thestockholders, the holders of Series B Preferred Stock shall be entitled to twoand one-half (2-1/2) votes for each share of Series B Preferred Stock, and theholders of common stock shall be entitled to one vote for each share of commonstock.

 

Section4.  Conversion Rights.  Each holder of the Series B Preferred Stock,at its option and at any time, is entitled to receive two and one-half (2-1/2)shares of common stock for each share of Series B Preferred Stock delivered tothe Corporation for conversion.  Awritten notice shall be given to the

 

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Corporation not less thanthirty days before the shares of Series B Preferred Stock are submitted forconversion.  If at any time after theissuance of the Series B Preferred Stock, the Corporation issues additionalshares of common tock as a stock dividend, or subdivides or combines theoutstanding shares of common stock, the rate of conversion shall be proportionatelyadjusted.  All shares of Series BPreferred Stock surrendered for conversion shall be canceled and shall not bereissued.  All such shares shall uponcancellation become authorized, but unissued shares of Series B PreferredStock, and may be reissued as part of a new series of preferred stock to becreated by resolution of the Board of Directors.  So long as any shares of Series B Preferred Stock areoutstanding, the Corporation shall reserve a sufficient number of unissuedshares of the authorized common stock to satisfy in full the conversionprivileges of the holder of those shares. The Corporation need not issue fractional shares of its common stock,but may instead pay cash equal to the market value of the fractional shares theholder of the Series B Preferred Stock would otherwise be entitled to onconversion.

 

Section5.  Redemption Rights.

 

(a)                                  Automatic.  On September 30, 2007, all shares of SeriesB Preferred Stock shall be redeemed by the Corporation at a price per shareequal to the consideration received by the Corporation for the issuance of theSeries B Preferred Stock (on a per share basis) together with accruedcumulative dividends (the “Series B Redemption Price”).

 

(b)                                 VoluntaryRedemption.  Beginning afterSeptember 30, 2005, either the Corporation or a holder of Series B PreferredStock may redeem at the Series B Redemption Price all or part of the Series BPreferred Stock upon three (3) months prior written notice to the holder ofSeries B Preferred Stock or the Corporation, as the case may be.  In the event the Corporation desires toredeem less than all of the outstanding Series B Preferred Stock pursuant tothe foregoing sentence, such redemption shall be pro rata amongst the holdersof the Series B Preferred Stock based on the number of shares of Series BPreferred Stock held by such holder.

 

(c)                                  Saleof Corporation.  In the event of a(i) merger of the Corporation with or into another entity pursuant to which theCorporation shall not be the surviving entity, (ii) sale of all orsubstantially all of the assets of the Corporation or (iii) sale of greaterthan 50% of the capital stock of the Corporation, the holders of Series BPreferred Stock may require the Corporation to redeem at the Series BRedemption Price all or part of the Series B Preferred Stock held by suchholder.

 

Section6.  Transfer Restrictions.  The Series B Preferred Stock shall benon-transferable.  Common stock receivedby the holder of the Series B Preferred Stock upon conversion shall bear thefollowing restrictive legend:

 

“THE SECURITYHAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SHARES OF STOCK REPRESENTED BY THISCERTIFICATE HAVE BEEN ACQUIRED PURSUANT TO AN INVESTMENT REPRESENTATION ON THEPART OF THE REGISTERED OWNER HEREOF.  IFTHE CORPORATION SO REQUESTS, BEFORE THESE SHARES ARE SOLD, PLEDGED,HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED, WHETHER OR NOT FORCONSIDERATION, THE REGISTERED OWNER HEREOF SHALL OBTAIN AN OPINION OF COUNSELSATISFACTORY TO THE BOARAD OF DIRECTORS, IN THE BOARD’S SOLE DISCRETION, THATANY SUCH

 

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TRANSFER WILLNOT BE IN VIOLATION OF THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLESTATE SECURITIES LAWS.”

 

Section7.  Liquidation, Dissolution and WindingUp.  In the event of theliquidation, dissolution or winding up of the Corporation, the holders ofSeries B Preferred Stock shall be entitled to receive in full the respectiveamounts fixed in accordance with the provisions below before any distributionor payment is made to the holders of shares of common stock.  The holders of Series B Preferred Stock willbe entitled to receive an amount equal to the consideration received by theCorporation for the issuance of the Series B Preferred Stock, together with theaccrued cumulative dividends to the payment date, whether or not earned ordeclared.  After full payment has beenmade to the holders of Series B Preferred Stock, the holders of Series APreferred Stock will be entitled to receive an amount equal to theconsideration received by the Corporation for the issuance of the Series APreferred Stock, together with the accrued cumulative dividends to the paymentdate, whether or not earned or declared. After full payment has been made to the holders of the Series BPreferred Stock, the remaining assets of the Corporation are to be distributedequally to all holders of outstanding common stock, share for share.  If the assets of the Corporation areinsufficient to satisfy in full the payments to the holders of the Series BPreferred Stock as provided herein, then the holders of the Series B PreferredStock will share in any distribution of assets to the fullest extent to whichthey otherwise are legally entitled, and then, if any assets remain, theholder(s) of the Series A Preferred Stock will share in any distribution ofassets to the fullest extent to which they otherwise are legally entitled.  This provision shall not apply to a mergeror consolidation by the Corporation, nor to any lease or conveyance ofsubstantially all of its assets.

 

IN WITNESSWHEREOF, American Medical Technologies, Inc. has caused this certificate to beduly executed this 10th day of January, 2003.

 
|   | AMERICAN  MEDICALTECHNOLOGIES, INC. |
|--------|-------------------------------------|
|   |                                |
|   |                                |
|   | By                                  | */s/*   Roger W. Dartt |   |
|   |                                | Roger W. Dartt, President |

 

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