Exhibit 4.14

CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTSOFSERIES B CONVERTIBLE PREFERRED STOCKOFBIOGAN INTERNATIONAL, INC.

 

Pursuant to Section 151 of theGeneral Corporation Law of the State of Delaware

        I, Joseph P. Galda, being the Secretary of Biogan International, Inc., acorporation organized and existing under the General Corporation law of theState of Delaware (the "Corporation"), DO HEREBY CERTIFY THAT:

        Pursuant to the authority conferred upon the Board of Directors byCertificate of Incorporation of the said Corporation, the Executive Committee ofsaid Board of Directors on July 16, 2002, adopted the following resolutioncreated a series of 3,624,000 shares of Series B Convertible Preferred Stock,par value $.001 per share, designated as Series B Convertible Preferred Stock,as follows:

        RESOLVED, that pursuant to the authority vested in the Executive Committee ofthe Board of Directors of this Corporation in accordance with the provisions ofits Certificate of Incorporation a series of Preferred Stock of the Corporationis hereby created, and that the designation and amount thereof and the votingpowers, preferences and relative, participating, optional and other specialrights of the shares of such series, and the qualifications, limitations orrestrictions thereof, are as follows:

Series B Convertible Preferred Stock

        1.    Designation and Number. The designation of a series of preferredstock fixed by this resolution shall be "Series B Convertible Preferred Stock"(the "Series B Preferred Stock") and the number of shares constituting suchseries shall be 3,624,000.

        2.    Rank. The Series B Preferred Stock shall rank (i) on parity withall of the Corporation's Common Stock, par value $.001 per share ("CommonStock"), (ii) prior to any class or series of capital stock of the Corporationhereafter created either specifically ranking by its terms junior to the SeriesB Preferred Stock and the Common Stock or not specifically ranking by its termssenior to or on parity with the Series B Preferred Stock and the Common Stock("Series B Junior Securities"); (iii) on parity with any class or series ofcapital stock of the Corporation hereafter created specifically ranking by itsterms on parity with the Series B Preferred Stock and the Common Stock ("SeriesB Parity Securities"); and (iv) junior to the outstanding shares of theCorporation's Series A Convertible Preferred Stock and any class or series ofcapital stock of the Corporation hereafter created specifically ranking by itsterms senior to the Series B Preferred Stock ("Series B Senior Securities"), ineach case, as to payment of dividends or as to distributions of assets uponliquidation, dissolution or winding-up of the Corporation, whether voluntary orinvoluntary (all such distributions being referred to collectively as"Distributions"). 

        3.    Dividends and Distributions. If any Distribution shall be made(including, without limitation, a distribution in liquidation or a distributionof rights) to the holders of Common Stock, the Corporation shall at the sametime pay a Distribution to the holders of the Series B Preferred Stock(collectively, the "Series B Holders" and individually a "Series B Holder") oneach share of Series B Preferred Stock equal to the Distributions that wouldhave been paid or made in respect of the shares of Common Stock into which suchshare of Series B Preferred Stock is convertible on the record date for thedetermination of stockholders of Common Stock to be entitled to suchDistribution.

        4.    Voting Rights. Each Series B Holder of Series B Preferred Stockshall be entitled to vote on all matters as to which the holders of the CommonStock are entitled to vote and, except as otherwise expressly provided herein,shall be entitled to that number of votes equal to the largest number of wholeshares of Common Stock into which such Series B Holder's shares of Series BPreferred Stock could be converted pursuant to the provisions of paragraph 5below (without regard to any limitation on the number of shares of Common Stockwhich is authorized for issuance), as of the record date for the determinationof the stockholders entitled to vote on such matters or, if no such record dateis established, at the date such vote is taken or the date any written consentof stockholders is obtained. Except as otherwise required by law, the Series BHolders of Series B Preferred Stock and the holders of the Common Stock shallvote together as a single class and not as separate classes.

    5.    Conversion.

           (A)    Automatic Conversion. The Series B Preferred Stock shall beautomatically converted, in whole, but not in part, into fully paid andnon-assessable shares of Common Stock at the effective time (the **"**EffectiveTime") of an amendment to the Certificate of Incorporation of the Corporationauthorizing an additional issuance of Common Stock in an amount sufficient topermit a conversion of all issued and outstanding Series B Preferred Stock toCommon Stock of the Corporation, or upon the effective date of any transactionwhich effects a change of control of the Corporation the Series B PreferredStock will be deemed to have been converted for the purpose of calculating therights and interests of the holders of the Series B Preferred Stock in suchchange of control transaction. 

          (B)    Conversion Rate. Each share of Series B Preferred Stock shall beconvertible into 100 shares of Common Stock (the "Conversion Rate"). TheConversion Rate shall be subject to adjustment from time to time as providedbelow. 

           (C)    Mechanics of Conversion. Within three business days after theEffective Time, the Corporation shall send a notice to each Series B Holder ofSeries B Preferred Stock, advising such Series B Holder to surrendercertificates representing such Series B Preferred Stock, to the Corporation.Upon presentation of such certificates, duly endorsed for transfer, theCorporation shall thereupon promptly issue and deliver at such office to suchSeries B Holder a certificate or certificates for the number of shares of CommonStock to which such Series B Holder is entitled. Such conversion will be deemedto have been made as of the Effective Time. 

           (D)    Adjustment for Subdivisions and Combinations. If the Corporationat any time or from time to time at or prior to the Effective Time effects asubdivision or combination of the shares of Common Stock (whether effected as astock split, reverse stock split, reclassification or otherwise), the applicableConversion Rate then in effect immediately prior to such event shall beproportionately adjusted in accordance with paragraph 5(G).

           (E)    Adjustment for Certain Dividends and Distributions. If theCorporation at any time or from time to time prior to the Effective Time makes adividend (or other such distribution) payable in shares of Common Stock, thenand in each such event the applicable Conversion Rate then in effect shall beappropriately adjusted as of the time of such issuance in accordance withparagraph 5(G).

           (F)    Adjustment for Reclassification. In the event that at any time orfrom time to time prior to the Effective Time the shares of Common Stockissuable upon the conversion of the Series B Preferred Stock are changed intothe same or a different number of shares of any class or classes of stock,whether by recapitalization, reclassification or otherwise (other than asubdivision or combination of shares provided for elsewhere in this paragraph5), then and in any such event each Series B Holder shall have the rightthereafter to convert such stock into the kind and amount of stock and othersecurities and property receivable upon such recapitalization, reclassificationor other change by holders of the maximum number of shares of Common Stock intowhich such shares of Series B Preferred Stock could have been convertedimmediately prior to such recapitalization, reclassification or change, allsubject to further adjustment as provided herein. 

           (G)    Calculation of Adjustment to Conversion Rate. In the case of anyadjustment to the Conversion Rate required pursuant to paragraphs 5(D) and (E)above, such adjustment shall be calculated as follows. The applicable ConversionRate in effect immediately prior to the event requiring such adjustment shall bemultiplied by a fraction (i) the denominator of which shall be the number ofshares of Common Stock outstanding immediately prior to the event and (ii) thenumerator of which is the number of shares of Common Stock outstandingimmediately following such event. Any such adjustment shall become effective asfollows: (i) in the case of any adjustment under paragraph 5(D), on theeffective date of any event described therein and (ii) in the case of anyadjustment under paragraph 5(E), retroactively to the record date fixed for suchdividend or distribution. 

           (H)    Certificate of Adjustment. In each case of an adjustment orreadjustment of the applicable Conversion Rate, the Corporation shall promptlyprepare a certificate signed by an officer of the Corporation showing suchadjustment or readjustment, and shall provide such certificate to eachregistered Series B Holder of the Series B Preferred Stock. The certificateshall set forth such adjustment or readjustment, showing in detail the factsupon which such adjustment or readjustment is based, including a statement, ifappropriate, of (i) the applicable Conversion Rate at the time immediatelypreceding and following such adjustment or readjustment, (ii) the number ofshares of Common Stock issued in the transaction requiring the adjustment (ifany) and (iii) the type and amount, if any, of other property which at the timewould be received upon conversion of the Series B Preferred Stock.

           (I)    Fractional Shares. No fractional shares of Common Stock shall beissued upon conversion of Series B Preferred Stock. In lieu of any fractionalshare to which the Series B Holder would otherwise be entitled, the Corporationshall pay cash equal to the product of such fraction multiplied by the fairmarket value of the Common Stock on the date of conversion. The fair marketvalue of the Common Stock shall be the fair market value of the Common Stock asdetermined in good faith by the Board of Directors of the Corporation (whichdetermination shall be reasonably satisfactory to the Series B Holders of theSeries B Preferred Stock).

           (J)    Notices. Any notice required by the provisions of this paragraph 5to be given to the Series B Holders of shares of the Series B Preferred Stockwill be deemed given upon the earlier of actual receipt or 72 hours after thesame has been deposited in the United States mail, by certified or registeredmail, return receipt requested, postage prepaid, and addressed to each Series BHolder of record at the address of such Series B Holder appearing on the booksof the Corporation.

           (K)    Payment of Taxes. The Corporation shall pay all taxes (other thantaxes based upon income) and other governmental charges that may be imposed withrespect to the issue or delivery of shares of Common Stock upon conversion ofshares of Series B Preferred Stock. 

           IN WITNESS WHEREOF, the Corporation has caused this Certificate to be signedby Joseph P. Galda, its Secretary.

Date: July 18, 2002

|   | BIOGAN INTERNATIONAL, INC.                                                    |
|--------|-------------------------------------------------------------------------------|
|   |                                                                          |
|   | By:  /s/ Joseph P. Galda         |
|   | Name: Joseph P. Galda                                                         |
|   | Title: Secretary                                                              |