**Exhibit4.7**

 

**AMENDED AND RESTATEDCERTIFICATE OF INCORPORATIONOFROLLER BEARING HOLDING COMPANY, INC.**

 

The undersigned, for thepurpose of amending and restating the Certificate of Incorporation of RollerBearing Holding Company, Inc., a Delaware corporation (the “*Corporation*”),does hereby certify that:

 

# 1.                                       Thedate of filing of the Corporation’s original Certificate of Incorporation withthe Secretary of State of the State of Delaware was March 23, 1992;

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# 2.                                       TheAmended and Restated Certificate of Incorporation has been duly adoptedpursuant to Sections 228, 242 and 245 of the Delaware General Corporation Law;

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# 3.                                       Writtennotice of the taking of action by written consent has been sent to allshareholders who did not consent to the adoption of this Amended and RestatedCertificate of Incorporation; and

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# 4.                                       TheCertificate of Incorporation of the Corporation is hereby amended and restatedin its entirety as follows:

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## FIRST:  Name.

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The name of theCorporation is:

 

RollerBearing Holding Company, Inc.

 

## SECOND: Registered Office.

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The address of theregistered office of the Corporation in the State of Delaware is 2711Centerville Road, Suite 400, City of Wilmington, County of New Castle; and thename of its registered agent at that address is Corporation Service Company.

 

## THIRD: Purposes.

 

The purpose of theCorporation is to engage in any lawful act or activity for which corporationsmay be organized under the General Corporation Law of Delaware.

 

## FOURTH: Capital Stock

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### A.                                   AuthorizedCapital Stock. The Corporation is authorized to issue five classes ofcapital stock to be designated, respectively, “*Common Stock,*” “*Class APreferred Stock,*” *“Class B Preferred Stock,”**“Class CPreferred Stock”*and *“Class D Preferred Stock,”* each ofwhich shall have a par value of $.01 per share. The total number of shareswhich the Corporation is authorized to issue is 10,395,500 shares, of which:(i) 9,000,000****shares shall be designated as Common Stock, of which (a)8,000,000 shares shall be designated Class A Voting Common Stock (the “*Class ACommon Stock*”) and (b) 1,000,000****shares shall be designated

 

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Class B SupervotingCommon Stock (the “*Class B Common Stock*” and togetherwith the Class A Common Stock, the “*Common Stock*”); (ii) 15,500****sharesshall be designated as Class A Preferred Stock; (iii) 240,000 shares shall bedesignated as Class B Exchangeable Convertible Participating Preferred Stock(the “*ClassB Preferred Stock”* and each share thereof a *“Class B Share”*);(iv) 900,000 shares shall be designated as Class C Redeemable Preferred Stock(the *“ClassC Preferred Stock”*and together with the Class A Preferred Stockand Class B Preferred Stock, the*“Dividend Preferred Stock”)*;**and(v) 240,000 shares shall be designated as Class D Preferred Stock (the *“Class DPreferred Stock”* and together with the Class A Preferred Stock,Class B Preferred Stock and Class C Preferred Stock, the *“Preferred Stock”*).  The Corporation shall have the authority toissue fractional shares.

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### B.                                     Rights,Preferences, Privileges and Restrictions of Preferred Stock.

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#### (1)                                  General.  Except as otherwise provided in this SectionB of Article Fourth or as otherwise required by applicable law, all shares of aparticular class of Preferred Stock shall be identical in all respects andshall entitle the holders thereof to the same rights, powers, preferences andprivileges, subject to the same qualifications, limitations, and restrictions.

 

#### (2)                                  Dividends.

 

##### (a)                                  Rightto Receive Preferential Dividends. When and as declared by theCorporation’s Board of Directors (the *“Board of Directors”*) and to theextent permitted under the General Corporation Law of the State of Delaware(the *“DGCL”*),the Corporation shall pay preferential dividends (the *“Preferential Dividends”*)to the holders of the Preferred Stock as provided in this Section 2(a) andSections 2(b) and 2(c) below.  Suchdividends shall accrue on each share of Dividend Preferred Stock, until paid,on a daily basis at a rate equal to 8.0% *per annum*on the sum of (x) the StatedValue of such share and (y) the aggregate amount of all dividends that haveaccumulated with respect to such share in accordance with Section 2(b) below,from and including the Date of Issuance of such share to and including theearlier to occur of (i) the date on which such share’s Liquidation Amount (asdescribed in Section 3 below) is paid to the holder thereof, and (ii) thedate on which such share is redeemed as provided herein.  Such dividends shall accrue whether or notthey have been declared and whether or not there are profits, surplus or otherfunds of the Corporation legally available for the payment of dividends.  Such dividends (to the extent declared)shall be payable in cash, quarterly in arrears, on the last day of March, June,September and December of each year beginning September 30, 2002, and if suchdate is not a Business Day, then on the next succeeding Business Day (the “DividendReference Dates”).  As used herein,the term *“StatedValue*” shall mean (i) $3,000 per share in the case of the ClassA Preferred Stock, and (ii) $100 per share in the case of the Class B PreferredStock and the Class C Preferred Stock, in each case subject to adjustment toreflect any stock split, stock dividend, reclassification, recapitalization orother transaction having a similar effect. The date on which the Corporation initially issues any share ofPreferred Stock shall be deemed to be its *“Date of Issuance”* regardless ofthe number of times transfers of such share are made on the stock recordsmaintained by or for the

 

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Corporation andregardless of the number of certificates which may be issued to evidence suchshare.

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##### (b)                                 Accumulationof Accrued and Unpaid Dividends. For purposes of clarity, to the extent not paid on a Dividend ReferenceDate, all dividends which have accrued pursuant to Section 2(a) above on eachshare of Preferred Stock shall be accumulated and shall remain accumulateddividends with respect to such share until paid to the holder thereof.  As used herein, the term *“UnpaidDividends”* shall mean, with respect to any share of DividendPreferred Stock as of any date of determination, the aggregate amount of allaccrued and unpaid dividends thereon (if any), including all dividends whichhave accumulated thereon pursuant to this Section 2(b), from the Date ofIssuance of such share to and including such date of determination.

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##### (c)                                  Distributionof Partial Dividend Payments. Except as otherwise provided herein, if at any time the Corporation paysless than the total amount of dividends then accrued pursuant to Section 2(a)above with respect to any class or series of Dividend Preferred Stock, suchpayment shall be distributed *pro rata* among the holders thereof basedupon the aggregate Unpaid Dividends on such shares held by each such holder.

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##### (d)                                 ParticipatingDividend.  Subject to Section 2(e)below, in the event that the Corporation declares or pays any dividends uponthe Common Stock (other than dividends payable in additional shares of CommonStock), the Corporation shall also declare and pay to the holders of anyoutstanding shares of Class B Preferred Stock at the same time that it declaresand pays such dividends to the holders of the Common Stock, the dividends whichwould have been declared and paid with respect to the Common Stock issuableupon conversion of such Class B Preferred Stock had all of the outstandingClass B Preferred Stock been converted immediately prior to the record date forsuch dividend, or if no record date is fixed, the date as of which the recordholders of Common Stock entitled to such dividends are to be determined.

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##### (e)                                  DividendPreference.  The PreferentialDividends on the Dividend Preferred Stock shall be payable before any dividendsor distributions or other payments shall be paid or set aside for payment inrespect of any Junior Stock (other than dividends payable in additional sharesof Common Stock).  The term “*JuniorStock*” shall mean (i) with respect to the Class A PreferredStock, any other class or series of capital stock of the Corporation, (ii) withrespect to the Class B Preferred Stock and the Class C Preferred Stock, anyother class or series of capital stock of the Corporation other than the ClassA Preferred Stock, and (iii) with respect to the Class D Preferred Stock, anyother class or series of capital stock of the Corporation other than the ClassA Preferred Stock, Class B Preferred Stock or Class C Preferred Stock.  If at any time the Preferential Dividends onthe outstanding shares of the Dividend Preferred Stock at the rate set forthherein shall not have been paid or declared and set apart for payment withrespect to all preceding and current periods, the amount of the deficiencyshall be fully paid or declared and set apart for payment, before any dividend,distribution or payment shall be declared or paid upon or set apart for theshares of any other class or series of Junior Stock.

 

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#### (3)                                  Liquidation;Sale of the Corporation.

 

##### (a)                                  Liquidation.  Upon any liquidation, dissolution or windingup of the Corporation, whether voluntary or involuntary (a “*LiquidationEvent*”), then the assets of the Corporation that are legallyavailable for distribution to the Corporation’s stockholders shall be paid asfollows:

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###### (i)                                     *first*,to the holders of Class A Preferred Stock *pro rata*based on their relative aggregateClass A Liquidation Amount, as defined below, until such holders receive aliquidation payment in respect of each share of Class A Preferred Stock equalto the sum of (x) the Stated Value of such share and (y) an amount equal to allUnpaid Dividends on such share (such sum, the *“Class A Liquidation Amount”*);

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###### (ii)                                  *second*,to the holders of Class B Preferred Stock *pro rata*based on their relative aggregateClass B Liquidation Amount, as defined below, until such holders receive aliquidation payment in respect of each share of Class B Preferred Stock equalto the sum (x) the Stated Value of such share, (y) an amount equal to allUnpaid Dividends on such share, and (z) the Preference Amount (as definedbelow) payable in respect of such share as of the date of the applicableLiquidation Event (such sum, the *“Class B Liquidation Amount”*);

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###### (iii)                               *third*,to the holders of Class C Preferred Stock *pro rata*based on their relative aggregateClass C Liquidation Amount, as defined below, until such holders receive aliquidation payment in respect of each share of Class C Preferred Stock equalto the sum of (x) the Stated Value of such share and (y) an amount equal to allUnpaid Dividends on such share (the *“Class C Liquidation Amount”)*;

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###### (iv)                              *fourth,*to the holders of Class D Preferred Stock *pro rata*based on their relative aggregateClass D Liquidation Amount, as defined below, until such holders receive aliquidation payment in respect of each share of Class D Preferred Stock equalto the Preference Amount (as defined below) payable in respect of such share asof the date of the applicable Liquidation Event (the *“Class D Liquidation Amount”)*(theaggregate amount of the Class A Liquidation Amount, the Class B LiquidationAmount, the Class C Liquidation Amount and the Class D Liquidation Amount forall outstanding shares of Preferred Stock as of any date of determination shallbe referred to herein as the *“Preferred Stock Liquidation Preference”*);and

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###### (v)                                 *fifth*,to the holders of the Common Stock *pro rata* based on the number of shares ofCommon Stock held by such holders determined on a fully diluted,as-if-converted basis (*provided*, that any amount payable pursuantto this clause (v) to a holder of options or warrants that are convertible intoor exerciseable for shares of Common Stock shall be adjusted to reflect thepayment by such holder of the aggregate exercise price of such options orwarrants).

 

##### (b)                                 Saleof the Corporation.  In connectionwith any: (i) consolidation or merger of the Corporation into or with any otherentity or entities which results in the exchange of outstanding shares of theCorporation for securities or other consideration

 

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issued or paid or causedto be issued or paid by any such entity or affiliate thereof (except aconsolidation or merger into a subsidiary or merger in which the Corporation isthe surviving corporation and the holders of the Corporation’s voting stockoutstanding immediately prior to the transaction hold a majority of the votingstock of the Corporation outstanding immediately following the transaction);(ii) sale or transfer by the Corporation of all or substantially all its assets(it being understood that, in addition to and not in limitation of applicablelaw, any sale or series of related sales of assets representing 60% or more ofthe (A) fair market value of the assets, (B) revenues or (C) earnings beforeinterest, taxes, depreciation and amortization of the Corporation and itssubsidiaries taken as a whole shall constitute a sale of “all or substantiallyall” of the Corporation’s assets for purposes hereof); (iii) sale of a majorityof the outstanding Common Stock in a single transaction or a series of relatedtransactions; or (iv) sale of less than a majority of the outstanding CommonStock in a single transaction or a series of related transactions where aftergiving effect to such sale or series of sales more than a majority ofoutstanding voting power of the Corporation would be held by individuals orentities other than stockholders of the Corporation immediately before suchevent or the first of such series of events (each a *“Sale of the Corporation”*),the consideration to be paid in connection with such transaction shall beallocated among the holders of Preferred Stock and Common Stock such that theholders thereof receive the amounts to which they would be entitled pursuant toSection 3(a) above as if such sale of the Company were a “LiquidationEvent.”  If any Sale of the Corporationdoes not involve the sale of all of the Corporation’s assets or of all of theoutstanding capital stock of the Corporation, then the provisions hereof shallalso apply in the case of any subsequent sale of the Corporation.  The Corporation shall not approve, adopt orenter into any agreement or arrangement relating to a Sale of the Corporation(or amend or modify any such agreement) if such agreement or arrangement (or theeffect of any such amendment or modification thereto) does not allocate theconsideration to be paid in connection with such transaction in accordance withthe immediately preceding sentence.

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##### (c)                                  Notice.  The Corporation shall provide written noticeof any Liquidation Event or Sale of the Corporation, stating a payment date andthe place where said payments shall be made, to the holders of record ofPreferred Stock by mail, postage prepaid, or by telex to non-U.S. residents,not less than 10 days prior to the payment date stated therein, such notice tobe addressed to each such holder at its address as shown by the records of theCorporation.  Any holder of PreferredStock may at any time waive its right to receive any such notice by providingthe Corporation with written notice thereof.

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##### (d)                                 LiquidationPayments.  If the assets and fundsof the Corporation available for distribution to the holders of the PreferredStock upon any Liquidation Event shall be insufficient to permit the payment toholders of the Preferred Stock the full Preferred Stock Liquidation Preference,the holders of each class of Preferred Stock shall share ratably (and ratablyas to cash, in-kind or other distributions) in any distribution of assets orfunds of the Corporation in proportion to the full respective Class A LiquidationAmount, Class B Liquidation Amount, Class C Liquidation Amount and Class DLiquidation Amount to which they are entitled; and the holders of the PreferredStock shall retain their preferential rights stated herein with respect to anysubsequent distribution of the Corporation’s assets and funds.

 

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##### (e)                                  CertainDefinitions.  As used herein, thefollowing terms shall have the following meanings:

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###### (i)                                     *“ApplicablePercentage”*means, for purposes of determining Net Equity Valueduring the period of time set forth in the following table under the heading“Time of Determination,” the percentage set forth in the following tableopposite such period of time under the heading “Applicable Percentage”:

 

| **YEAR OF DETERMINATION**                                |   | **APPLICABLE  PERCENTAGE** |
|----------------------------------------------------------|--------|----------------------------|
| Prior  to July 29, 2003                                  |   | 20%                        |
|                                                     |   |                       |
| From  and after July 29, 2003 but prior to July 29, 2004 |   | 40%                        |
|                                                     |   |                       |
| From  and after July 29, 2004 but prior to July 29, 2005 |   | 60%                        |
|                                                     |   |                       |
| From  and after July 29, 2005 but prior to July 29, 2006 |   | 80%                        |
|                                                     |   |                       |
| From  and after July 29, 2006 but prior to July 29, 2007 |   | 100%                       |
|                                                     |   |                       |
| From  and after July 29, 2007                            |   | 120%                       |

 

###### (ii)                                  *“FundedDebt”* shall mean, as of any date of determination and alwayswithout duplication, all indebtedness of the Corporation or its subsidiariesfor borrowed money evidenced by notes, bonds, debentures or similar evidencesof indebtedness.

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###### (iii)                               *“PreferenceAmount”* shall mean, with respect to each share of Class BPreferred Stock and each share of Class D Preferred Stock (as the case may be)as of any date of determination, the number computed by multiplying (x) theApplicable Percentage as of such date by (y) the number computed by dividing(A) the sum of (i) .0254 multiplied by the Net Equity Value determinedas of such date plus (ii) $6,800,000 by (B) 240,000 (subject toadjustment to reflect any stock split, stock dividend, reclassification,recapitalization or other transaction having a similar effect)

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###### (iv)                              *“NetEquity Value”* means, as of any date of determination, the“enterprise value” of the Corporation and its subsidiaries (determined asdescribed below) less Funded Debt, in each case as of such date.  For purposes of the definition of Net EquityValue, the “enterprise value” of the Corporation and its subsidiaries shallequal (i) in the case of any Liquidation Event other than a Sale of theCorporation, the amount jointly

 

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determined by the Boardof Directors and the holders of a majority of the outstanding shares of Class BPreferred Stock and shares of Class D Preferred Stock (taken together as asingle class), each acting in good faith, and (ii) in the case of a Sale of theCorporation, the aggregate consideration payable in such transaction plusthe amount of cash and cash equivalents that would be required under generallyaccepted accounting principles to be recorded on a consolidated balance sheetof the Corporation and its subsidiaries prepared as of the applicable date ofdetermination.  In the case of clause(i) above, if the Board of Directors and the holders of the Series B PreferredStock and Series D Preferred Stock are unable to reach agreement on thedetermination of “enterprise value” within a reasonable amount of time, suchdetermination shall be made by a nationally-recognized independent appraiserexperienced in valuing securities.  Suchappraiser shall be jointly selected by the Corporation and the holders of amajority of the outstanding shares of Class B Preferred Stock.  The determination of such appraiser shall befinal and binding upon the Corporation and the holders of the Class B PreferredStock, and the fees and expenses of such appraiser shall be borne by theCorporation.

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#### (4)                                  Conversionof Class B Preferred Stock.

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##### (a)                                  ConversionProcedure.

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###### (i)                                     Subjectto the terms of this Section 4, at any time and from time to time any holder ofClass B Preferred Stock may convert all or any portion of the Class B PreferredStock (including any fraction of a Class B Share) held by such holder into:

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(x) a number of shares ofClass C Preferred Stock computed by multiplying the number of Class B Shares tobe converted by the sum of (A) the Stated Value of such shares and (B) theamount of all Unpaid Dividends thereon as of such time and dividing the resultby the Stated Value of the Class C Preferred Stock,

 

(y) one (1) share ofClass D Preferred Stock (subject to adjustment to reflect any stock split,stock dividend, reclassification, recapitalization or other transaction havinga similar effect) for each Class B Share being converted; and

 

(z) a number of shares ofClass A Common Stock computed by multiplying the number of Class B Shares to beconverted by the Stated Value of the Class B Preferred Stock and dividing theresult by the Conversion Price in effect immediately prior to suchconversion.  The Conversion Price shallinitially be $32.49576 and shall be subject to adjustment pursuant to thisSection 4.

 

###### (ii)                                  Exceptas otherwise provided herein, each conversion of Class B Preferred Stock shallbe deemed to have been effected as of the close of business on the date onwhich the certificate or certificates representing the Class B Preferred Stockto be converted have been surrendered for conversion at the principal office ofthe Corporation.  At the time any suchconversion has been effected, the rights of the holder of the Shares convertedas a holder of Class B Preferred Stock shall cease and the Person or Persons inwhose name or names any certificate or certificates for shares of Class CPreferred Stock, Class D Preferred Stock and Class A Common Stock are to beissued upon such conversion shall be

 

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deemed to have become theholder or holders of record of the shares of Class C Preferred Stock, Class DPreferred Stock and Class A Common Stock represented thereby.

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###### (iii)                               Theconversion rights of any Class B Share subject to redemption or exchangehereunder shall terminate on the date of redemption for such Class B Shareunless the Corporation has failed to pay to the holder thereof the RedemptionPrice for such Class B Share.

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###### (iv)                              Notwithstandingany other provision hereof, if a conversion of Class B Preferred Stock is to bemade in connection with an Organic Change, a Sale of the Corporation or suchother transaction affecting the Corporation, the conversion of any Class BShare may, at the election of the holder thereof, be conditioned upon theconsummation of such transaction, in which case such conversion shall not bedeemed to be effective until such transaction has been consummated.

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###### (v)                                 Assoon as possible after a conversion has been effected (but in any event withinthree (3) business days), the Corporation shall deliver to the convertingholder:

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(A)                              acertificate or certificates representing the number of shares of Class CPreferred Stock, Class D Preferred Stock and Class A Common Stock issuable byreason of such conversion in such name or names and such denomination ordenominations as the converting holder has specified; and

 

(B)                                acertificate representing any shares of Class B Preferred Stock which wererepresented by the certificate or certificates delivered to the Corporation inconnection with such conversion but which were not converted.

 

###### (vi)                              Theissuance of certificates for shares of Class C Preferred Stock, Class DPreferred Stock and Class A Common Stock upon conversion of Class B PreferredStock shall be made without charge to the holders of such Class B PreferredStock for any issuance tax in respect thereof if issued in the name of suchholder or other cost incurred by the Corporation in connection with suchconversion and the related issuance of shares of Class C Preferred Stock, ClassD Preferred Stock and Class A Common Stock. Upon conversion of each Class B Share, the Corporation shall take allsuch actions as are necessary in order to insure that the Class C PreferredStock, Class D Preferred Stock and Class A Common Stock issuable with respectto such conversion shall be validly issued, fully paid and nonassessable, freeand clear of all taxes, liens, charges and encumbrances with respect to theissuance thereof.

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###### (vii)                           TheCorporation shall not close its books against the transfer of Class B PreferredStock or of any Class C Preferred Stock, Class D Preferred Stock and Class ACommon Stock issued or issuable upon conversion of Class B Preferred Stock inany manner which interferes with the timely conversion of Class B PreferredStock.  The Corporation shall assist andcooperate with any holder of Class B Shares required to make any

 

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governmental filings orobtain any governmental approval prior to or in connection with any conversionof Class B Shares hereunder (including, without limitation, making any filingsrequired to be made by the Corporation).

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###### (viii)                        TheCorporation shall at all times reserve and keep available out of its authorizedbut unissued shares of Class C Preferred Stock, Class D Preferred Stock andClass A Common Stock, solely for the purpose of issuance upon the conversion ofthe Class B Preferred Stock, such number of shares of Class C Preferred Stock,Class D Preferred Stock and Class A Common Stock issuable upon the conversionof all outstanding Class B Preferred Stock. All shares of Class C Preferred Stock, Class D Preferred Stock and ClassA Common Stock which are so issuable shall, when issued, be duly and validlyissued, fully paid and nonassessable and free from all taxes, liens andcharges.  The Corporation shall take allsuch actions as may be necessary to assure that all such shares of Class CPreferred Stock, Class D Preferred Stock and Class A Common Stock may be soissued without violation of any applicable law or governmental regulation orany requirements of any domestic securities exchange upon which shares of ClassA Common Stock may be listed (except for official notice of issuance whichshall be immediately delivered by the Corporation upon each suchissuance).  The Corporation shall nottake any action which would cause the number of authorized but unissued sharesof Class C Preferred Stock, Class D Preferred Stock and Class A Common Stock tobe less than the number of such shares required to be reserved hereunder forissuance upon conversion of the Class B Preferred Stock.

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###### (ix)                                Ifthe shares of Class C Preferred Stock or Class A Common Stock issuable byreason of conversion of Class B Preferred Stock are convertible into orexchangeable for any other stock or securities of the Corporation, theCorporation shall, at the converting holder’s option, upon surrender of theClass B Shares to be converted by such holder as provided herein together withany notice, statement or payment required to effect such conversion or exchangeof Class C Preferred Stock or Class A Common Stock, deliver to such holder oras otherwise specified by such holder a certificate or certificatesrepresenting the stock or securities into which the shares of Class C PreferredStock or Class A Common Stock issuable by reason of such conversion are soconvertible or exchangeable, registered in such name or names and in suchdenomination or denominations as such holder has specified.

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##### (b)                                 ConversionPrice.

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###### (i)                                     Inorder to prevent dilution of the conversion rights granted under thisSection 4, the Conversion Price shall be subject to adjustment from timeto time pursuant to this Section 4(b).

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###### (ii)                                  Ifand whenever after the original Date of Issuance of the Class B PreferredStock, the Corporation issues or sells, or in accordance with Section 4(c) isdeemed to have issued or sold, any share of Common Stock for a considerationper share less than $30.00 (subject to adjustment to reflect any stock split,stock dividend, reclassification, recapitalization or other transaction havinga similar effect), then immediately upon such issue or sale or deemed issue orsale, the Conversion Price shall be reduced to the Conversion Price

 

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determined by dividing(x) the sum of (i) the product determined by multiplying the Conversion Pricein effect immediately prior to such issuance or sale by the number of shares ofCommon Stock Deemed Outstanding immediately prior to such issuance or sale,plus (ii) the consideration, if any, received by the Corporation upon suchissuance or sale, by (y) the number of shares of Common Stock DeemedOutstanding immediately after such issuance or sale.

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###### (iii)                               Notwithstandingthe foregoing, there shall be no adjustment to the Conversion Price hereunderwith respect to a Permitted Issuance.

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##### (c)                                  Effecton Conversion Price of Certain Events. For purposes of determining the adjusted Conversion Price under Section4(b), the following shall be applicable:

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###### (i)                                     Issuanceof Rights or Options.  If theCorporation in any manner grants or sells any Options and the price per sharefor which Common Stock is issuable upon the exercise of such Options, or uponconversion or exchange of any Convertible Securities issuable upon exercise ofsuch Options, is less than $30.00 (subject to adjustment to reflect any stocksplit, stock dividend, reclassification, recapitalization or other transactionhaving a similar effect), then the total maximum number of shares of CommonStock issuable upon the exercise of such Options or upon conversion or exchangeof the total maximum amount of such Convertible Securities issuable upon theexercise of such Options shall be deemed to be outstanding and to have beenissued and sold by the Corporation at the time of the granting or sale of suchOptions for such price per share.  Forpurposes of this paragraph, the “price per share for which Common Stock isissuable” shall be determined by dividing (A) the total amount, if any,received or receivable by the Corporation as consideration for the granting orsale of such Options, plus the minimum aggregate amount of additionalconsideration payable to the Corporation upon exercise of all such Options,plus in the case of such Options which relate to Convertible Securities, theminimum aggregate amount of additional consideration, if any, payable to theCorporation upon the issuance or sale of such Convertible Securities and theconversion or exchange thereof, by (B) the total maximum number of shares ofCommon Stock issuable upon the exercise of such Options or upon the conversionor exchange of all such Convertible Securities issuable upon the exercise ofsuch Options.  No further adjustment ofthe Conversion Price shall be made when Convertible Securities are actuallyissued upon the exercise of such Options or when Common Stock is actuallyissued upon the exercise of such Options or the conversion or exchange of suchConvertible Securities.

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###### (ii)                                  Issuanceof Convertible Securities.  If theCorporation in any manner issues or sells any Convertible Securities and theprice per share for which Common Stock is issuable upon conversion or exchangethereof is less than $30.00 (subject to adjustment to reflect any stock split,stock dividend, reclassification, recapitalization or other transaction havinga similar effect), then the maximum number of shares of Common Stock issuableupon conversion or exchange of such Convertible Securities shall be deemed tobe outstanding and to have been issued and sold by the Corporation at the timeof the issuance or sale of such Convertible Securities for such price pershare.  For the purposes of thisparagraph, the “price per share for which Common Stock is issuable” shall bedetermined by dividing (A)

 

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the total amount receivedor receivable by the Corporation as consideration for the issue or sale of suchConvertible Securities, plus the minimum aggregate amount of additionalconsideration, if any, payable to the Corporation upon the conversion orexchange thereof, by (B) the total maximum number of shares of Common Stockissuable upon the conversion or exchange of all such ConvertibleSecurities.  No further adjustment ofthe Conversion Price shall be made when Common Stock is actually issued uponthe conversion or exchange of such Convertible Securities, and if any suchissue or sale of such Convertible Securities is made upon exercise of anyOptions for which adjustments of the Conversion Price had been or are to bemade pursuant to other provisions of this Section 4, no further adjustment ofthe Conversion Price shall be made by reason of such issue or sale.

 

###### (iii)                               Changein Option Price or Conversion Rate. If, in the case of Options and Convertible Securities issued on or afterthe Original Date of Issuance, the purchase price provided for in any suchOptions, the additional consideration, if any, payable upon the conversion orexchange of any such Convertible Securities or the rate at which any suchConvertible Securities are convertible into or exchangeable for Common Stockchanges at any time, the Conversion Price in effect at the time of such changeshall be immediately adjusted to the Conversion Price which would have been ineffect at such time had such Options or Convertible Securities stilloutstanding provided for such changed purchase price, additional considerationor conversion rate, as the case may be, at the time initially granted, issuedor sold; *provided*,that if such adjustment would result in an increase of the Conversion Pricethen in effect, such adjustment shall not be effective until 30 days afterwritten notice thereof has been given by the Corporation to all holders of theClass B Preferred Stock.  For purposesof Section 4(c), if the terms of any Option or Convertible Security which wasoutstanding as of the original Date of Issuance of the Class B Preferred Stockare changed in the manner described in the immediately preceding sentence, thensuch Option or Convertible Security and the Common Stock deemed issuable uponexercise, conversion or exchange thereof shall be deemed to have been issued asof the date of such change; *provided*, that no such change shall at anytime cause the Conversion Price hereunder to be increased.

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###### (iv)                              Treatmentof Expired Options and Unexercised Convertible Securities.  Upon the expiration of any Option or thetermination of any right to convert or exchange any Convertible Securitywithout the exercise of any such Option or right, the Conversion Price then ineffect hereunder shall be adjusted immediately to the Conversion Price whichwould have been in effect at the time of such expiration or termination hadsuch Option or Convertible Security, to the extent outstanding immediatelyprior to such expiration or termination, never been issued; *provided*,that if such expiration or termination would result in an increase in theConversion Price then in effect, such increase shall not be effective until 30days after written notice thereof has been given to all holders of the Class BPreferred Stock.  For purposes ofSection 4(c), the expiration or termination of any Option or ConvertibleSecurity which was outstanding as of the original Date of Issuance of the ClassB Preferred Stock shall not cause the Conversion Price hereunder to be adjustedunless, and only to the extent that, a change in the terms of such Option orConvertible Security caused it to be deemed to have been issued after theoriginal Date of Issuance of the Class B Preferred Stock.

 

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###### (v)                                 Calculationof Consideration Received.  If anyCommon Stock, Option or Convertible Security is issued or sold or deemed tohave been issued or sold for cash, the consideration received therefor shall bedeemed to be the amount received by the Corporation therefor (net of discounts,commissions and related expenses).  Ifany Common Stock, Option or Convertible Security is issued or sold for aconsideration other than cash, the amount of the consideration other than cashreceived by the Corporation shall be the fair value of such consideration,except where such consideration consists of securities, in which case theamount of consideration received by the Corporation shall be the Market Pricethereof as of the date of receipt.  Ifany Common Stock, Option or Convertible Security is issued to the owners of thenon-surviving entity in connection with any merger in which the Corporation isthe surviving corporation, the amount of consideration therefor shall be deemedto be the fair value of such portion of the net assets and business of thenon-surviving entity as is attributable to such Common Stock, Option orConvertible Security, as the case may be. The fair value of any consideration other than cash and securities shallbe determined by the Board of Directors in good faith; *provided*, that if theholders of a majority of the outstanding shares of Class B Preferred Stockdisagree with such determination, the fair value of such consideration shall bedetermined by an independent appraiser experienced in valuing such type ofconsideration jointly selected by the Corporation and the holders of a majorityof the outstanding shares of Class B Preferred Stock.  The determination of such appraiser shall be final and bindingupon the parties, and the fees and expenses of such appraiser shall be borne bythe Corporation.

######  

###### (vi)                              IntegratedTransactions.  In case any Option isissued in connection with the issue or sale of other securities of theCorporation, together comprising one integrated transaction in which nospecific consideration is allocated to such Option by the parties thereto, theconsideration for the Option shall be the Market Price thereof.

######  

###### (vii)                           TreasuryShares.  The number of shares ofCommon Stock outstanding at any given time shall not include shares owned orheld by or for the account of the Corporation or any Subsidiary, and thedisposition of any shares so owned or held shall be considered an issue or saleof Common Stock.

######  

###### (viii)                        RecordDate.  If the Corporation takes arecord of the holders of Common Stock for the purpose of entitling them (a) toreceive a dividend or other distribution payable in Common Stock, Options or inConvertible Securities or (b) to subscribe for or purchase Common Stock,Options or Convertible Securities, then such record date shall be deemed to bethe date of the issue or sale of the shares of Common Stock deemed to have beenissued or sold upon the declaration of such dividend or upon the making of suchother distribution or the date of the granting of such right of subscription orpurchase, as the case may be.

######  

##### (d)                                 Subdivisionor Combination of Common Stock.  Ifthe Corporation at any time subdivides (by any stock split, stock dividend,recapitalization or otherwise) one or more classes of its outstanding shares ofCommon Stock into a greater number of shares, the Conversion Price in effectimmediately prior to such subdivision shall be proportionately reduced (and anyother appropriate actions shall be taken by the Corporation) so

 

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that the holder of anyshare of Class B Preferred Stock thereafter surrendered for conversion (withoutactually requiring such Class B Preferred Stock to be so converted and withoutregard to any limitation on conversion set forth herein or otherwise) shall beentitled to receive, in addition to the number of shares of Class C PreferredStock computed in accordance with Section 4(a), the number of shares of CommonStock or other securities of the Corporation that such holder would have ownedor would have been entitled to receive upon or by reason of the eventsdescribed above, had such share of Class B Preferred Stock been converted(without actually requiring such Class B Preferred Stock to be so converted andwithout regard to any limitation on conversion set forth herein or otherwise)immediately prior to the occurrence of such event.  If the Corporation at any time combines (by reverse stock splitor otherwise) one or more classes of its outstanding shares of Common Stockinto a smaller number of shares, the Conversion Price in effect immediatelyprior to such combination shall be proportionately increased (and any otherappropriate actions shall be taken by the Corporation) so that the holder ofany share of Class B Preferred Stock thereafter surrendered for conversion(without actually requiring such Class B Preferred Stock to be so converted andwithout regard to any limitation on conversion set forth herein or otherwise)shall be entitled to receive, in addition to the number of shares of Class CPreferred Stock computed in accordance with Section 4(a), the number of sharesof Class A Common Stock or other securities of the Corporation that such holderwould have owned or would have been entitled to receive upon or by reason ofthe events described above, had such share of Class B Preferred Stock beenconverted (without actually requiring such Class B Preferred Stock to be soconverted and without regard to any limitation on conversion set forth hereinor otherwise) immediately prior to the occurrence of such event.

#####  

##### (e)                                  Reorganization,Reclassification, Consolidation, Merger or Sale.  Any recapitalization, reorganization, reclassification,consolidation, merger, sale of all or substantially all of the Corporation’sassets or other transaction, in each case which is effected in such a mannerthat the holders of Common Stock are entitled to receive (either directly orupon subsequent liquidation) stock, securities or assets with respect to or inexchange for Common Stock, is referred to herein as an “*Organic Change*”.  Prior to the consummation of any OrganicChange (other than an Organic Change that is also a Sale of the Corporation),the Corporation shall make appropriate provisions (in form and substancesatisfactory to the holders of a majority of the Class B Preferred Stock thenoutstanding) to insure that each of the holders of Class B Preferred Stockshall thereafter have the right to acquire and receive, in lieu of or inaddition to (as the case may be) the shares of Class C Preferred Stock, Class DPreferred Stock and Class A Common Stock immediately theretofore acquirable andreceivable upon the conversion of such holder’s Class B Preferred Stock, suchshares of stock, securities or assets as such holder would have received inconnection with such Organic Change if such holder had converted its Class BPreferred Stock (without actually requiring such Class B Preferred Stock to beso converted and without regard to any limitation on conversion set forthherein or otherwise) immediately prior to such Organic Change.  In each such case, the Corporation shallalso make appropriate provisions (in form and substance satisfactory to theholders of a majority of the Class B Preferred Stock then outstanding) toinsure that the provisions of this Section 4 shall thereafter be applicable tothe Class B Preferred Stock (including, in the case of any such consolidation,merger or sale in which the successor entity or purchasing entity is other thanthe Corporation, an immediate adjustment of the Conversion Price to the valuefor the Common Stock reflected by the terms of

 

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such consolidation,merger or sale, and a corresponding immediate adjustment in the number ofshares of Common Stock acquirable and receivable upon conversion of Class BPreferred Stock, if the value so reflected is less than $30.00 (subject toadjustment to reflect any stock split, stock demand, reclassification,recapitalization or other transaction having a similar effect).  The Corporation shall not effect any suchconsolidation, merger or sale, unless prior to the consummation thereof, thesuccessor entity (if other than the Corporation) resulting from consolidationor merger or the entity purchasing such assets assumes by written instrument(in form and substance satisfactory to the holders of a majority of the Class BPreferred Stock then outstanding), the obligation to deliver to each suchholder such shares of stock, securities or assets as, in accordance with theforegoing provisions, such holder may be entitled to acquire.

#####  

##### (f)                                    CertainDistributions.  In case theCorporation shall at any time or from time to time, prior to conversion ofshares of Class B Preferred Stock, distribute to all holders of shares of theCommon Stock (including any such distribution made in connection with a mergeror consolidation in which the Corporation is the resulting or surviving Personand the Common Stock is not changed or exchanged), cash, evidences ofindebtedness of the Corporation or another issuer, securities of theCorporation or another issuer or other assets (excluding cash dividends in whichholders of Class B Shares participate, in the manner provided in Section 2(d),dividends payable in shares of Common Stock for which adjustment is made underanother paragraph of this Section 4 and any distribution in connection with aPermitted Issuance), or rights or warrants to subscribe for or purchase of anyof the foregoing, then, and in each such case, the Conversion Price then ineffect shall be adjusted (and any other appropriate actions shall be taken bythe Corporation) by multiplying the Conversion Price in effect immediatelyprior to the date of such distribution by a fraction (x) the numerator of whichshall be the Market Price of the Common Stock immediately prior to the date ofdistribution less the then fair market value (as determined by the Board ofDirectors in the exercise of their fiduciary duties) of the portion of thecash, evidences of indebtedness, securities or other assets so distributed orof such rights or warrants applicable to one share of Common Stock and (y) thedenominator of which shall be the Market Price of the Common Stock immediatelyprior to the date of distribution (but such fraction shall not be greater thanone); *provided*,*however*,that no adjustment shall be made with respect to any distribution of rights orwarrants to subscribe for or purchase securities of the Corporation if theholder of shares of Class B Preferred Stock would otherwise be entitled toreceive such rights or warrants upon conversion at any time of shares of ClassB Preferred Stock into Class C Preferred Stock and Class A Common Stock.  Such adjustment shall be made whenever anysuch distribution is made and shall become effective retroactively to a dateimmediately following the close of business on the record date for thedetermination of stockholders entitled to receive such distribution.

#####  

##### (g)                                 CertainEvents.  If any event occurs of thetype contemplated by the provisions of this Section 4 but not expresslyprovided for by such provisions (including, without limitation, the granting ofstock appreciation rights, phantom stock rights or other rights with equityfeatures), then the Board of Directors shall make an appropriate adjustment inthe Conversion Price so as to protect the rights of the holders of Class BPreferred Stock; *provided*, that no such adjustment shall increase theConversion Price as

 

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otherwise determinedpursuant to this Section 4 or decrease the number of shares of Class A CommonStock issuable upon conversion of each Class B Share.

#####  

##### (h)                                 CertainDefinitions.  As used herein, thefollowing terms shall have the following meanings:

#####  

###### (i)                                     *“CommonStock Deemed Outstanding”*means, at any given time, the numberof shares of Common Stock actually outstanding at such time, plus the number ofshares of Common Stock deemed to be outstanding pursuant to Sections 4(c)(i)and 4(c)(ii) of this Section B of Article Fourth whether or not the Options orConvertible Securities are actually exercisable at such time, but excluding anyshares of Common Stock.

######  

###### (ii)                                  *“ConvertibleSecurities”*means any stock or securities directly or indirectlyconvertible into or exchangeable for Common Stock.

######  

###### (iii)                               *“InitialPublic Offering”*means the first underwritten public offering byeither the Company or any of its subsidiaries of its common stock pursuant to aregistration statement (other than a registration statement on Form S-8 or S-4or any successor form thereto) that has been filed under the Securities Act of1933, as amended (the *“Act”*), and declared effective bythe Securities and Exchange Commission or any similar agency then havingjurisdiction to enforce the Securities Act; provided, however,that for this purpose any offering under Rule 144A under the Securities Act orany similar rule or regulation promulgated under the Securities Act shall notbe deemed to be an Initial Public Offering.

######  

###### (iv)                              *“QualifiedPublic Offering”*means an Initial Public Offering in which theCorporation receives not less than $50 million in net proceeds and the pershare offering price is not less than $90 per share (subject to adjustment toreflect any stock split, stock dividend, reclassification, recapitalization orother transaction having a similar effect).

######  

###### (v)                                 *“MarketPrice”* of any security means the average of the closing pricesof such security’s sales on all securities exchanges on which such security mayat the time be listed, or, if there has been no sales on any such exchange onany day, the average of the highest bid and lowest asked prices on all suchexchanges at the end of such day, or, if on any day such security is not solisted, the average of the representative bid and asked prices quoted in theNASDAQ System as of 4:00 P.M., New York time, or, if on any day such securityis not quoted in the NASDAQ System, the average of the highest bid and lowestasked prices on such day in the domestic over-the-counter market as reported bythe National Quotation Bureau, Incorporated, or any similar successororganization, in each such case (i) averaged over a period of 20 daysconsisting of the day as of which “Market Price” is being determined and the 19consecutive business days prior to such day, and (ii) averaged on avolume-weighted basis based on the trading volume for each such business day.  If at any time such security is not listedon any securities exchange or quoted in the NASDAQ System or theover-the-counter market, the “Market Price” shall be the fair value thereofdetermined by the Board of Directors in good faith; *provided*, that if theholders of a majority of the outstanding shares of Class B Preferred Stockdisagree with such determination, such fair value shall be determined by anationally-recognized independent appraiser experienced in valuing such type of

 

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consideration jointlyselected by the Corporation and the holders of a majority of the outstandingshares of Class B Preferred Stock.  Thedetermination of such appraiser shall be final and binding upon the Corporationand the holders of the Class B Preferred Stock, and the fees and expenses ofsuch appraiser shall be borne by the Corporation.

######  

###### (vi)                              *“Options”*means any rights, warrants or options to subscribe for or purchaseCommon Stock or Convertible Securities.

######  

###### (vii)                           *“PermittedIssuance”* means any sale or issuance or deemed sale or issuanceof Common Stock: (i) issued or issuable upon the exercise, conversion orexchange of Options or Convertible Securities of the Corporation outstanding onthe date hereof; (ii) issued or issuable in respect of any management equityplans heretofore or hereafter approved by the Board to purchase Common Stock (*provided*,that such Common Stock together with all shares of Common Stock issued orissuable pursuant to this clause (ii) as to grants made after the date hereofdo not exceed 396,241.5 shares (subject to adjustment to reflect any stocksplit, stock dividend, reclassification, recapitalization or other transactionhaving a similar effect); and (iii) issued or issuable in connection with arestructuring, including a cancellation or modification of the terms of any, ofthe debt of the Corporation or any of its subsidiaries in which lenders orowners of debt securities of the Corporation or its subsidiaries receive equityinterests in consideration of or in connection with such restructuring.

######  

##### (i)                                     MandatoryConversion.  All outstanding sharesof Class B Preferred Stock shall be automatically converted in accordance withthe provisions of this Section 4 upon the consummation of (i) an Initial PublicOffering, and (ii) an Organic Change (other than an Organic Change which isalso a Sale of the Corporation).  In thecase of any conversion required in connection with (A) an Initial PublicOffering where such Initial Public Offering does not constitute a QualifiedPublic Offering or (B) an Organic Change, the Corporation shall not give effectto such conversion, and any such purported conversion shall be null and void,if the Corporation does not contemporaneously enter into an agreement providingthe holders of the shares of Class A Common Stock issuable upon conversion ofthe Class B Preferred Stock with anti-dilution rights with respect to suchshares of Class A Common Stock that are identical to the anti-dilutionprotection provided for in this Section 4.

#####  

##### (j)                                     Notices.

#####  

###### (i)                                     Immediatelyupon any adjustment of the Conversion Price, the Corporation shall give writtennotice thereof to all holders of Class B Preferred Stock, setting forth inreasonable detail and certifying the calculation of such adjustment.

######  

###### (ii)                                  TheCorporation shall give written notice to all holders of Class B Preferred Stockat least twenty (20) days prior to the date on which the Corporation closes itsbooks or takes a record (a) with respect to any dividend or distribution uponCommon Stock, (b) with respect to any pro rata subscription offer to holders ofCommon Stock, or (c) for determining rights to vote with respect to any Sale ofthe Corporation, Organic Change or Liquidation Event.

 

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###### (iii)                               TheCorporation shall also give written notice to the holders of Class B PreferredStock at least twenty (20) days prior to the date on which any Initial PublicOffering, Organic Change or Sale of the Corporation shall take place.

######  

#### (5)                                  Exchangeof Class B Preferred Stock.

####  

##### (a)                                  Exchange.  At any time and from time to time theCorporation may demand that the holders of Class B Shares surrender to theCorporation all or any lesser portion of the outstanding Class B PreferredStock, and in exchange for each surrendered Class B Share, the Corporationshall promptly issue to such holder the number of shares of Class C PreferredStock, Class D Preferred Stock and Class A Common Stock into which such Class BShare is then convertible in accordance with Section 4 of this Section B ofArticle Fourth (such number of shares of Class C Preferred Stock and Class ACommon Stock, the *“Exchange Shares”*). Any demand by the Corporation for the exchange of Class B PreferredStock pursuant to this Section 5 shall be made to the holders of the Class BPreferred Stock *pro rata*based upon the number of Class B Shares held byeach such holder and the aggregate number of shares to be exchanged.  The Corporation shall not give effect to anyexchange pursuant to this Section 5, and any such purported exchange shallbe null and void, if the Corporation (i) does not have sufficient legallyavailable funds to redeem all of the Class C Preferred Stock issuable inconnection with such exchange in accordance with Section 6(b), or (ii) theCorporation fails to redeem all of such shares of Class C Preferred Stockin accordance with Section 6(b).

#####  

##### (b)                                 ExchangeProcedure.  Not more than 15 daysprior to any exchange of Class B Preferred Stock, the Corporation shall sendwritten notice (each such notice, an *“Exchange Notice”*) to each recordholder of Class B Shares, notifying such holder of (i) the exchange to beeffected, specifying the number of shares of Class B Preferred Stock to beredeemed from each holder, (ii) the aggregate number of Exchange Shares to beissued to such holder, (iii) the date on which such exchange shall be effected,and (iv) the place at which the Exchange Shares to be issued to such holder maybe obtained and calling upon such holder to surrender to the Corporation, inthe manner and at the place designated, the certificate or certificatesrepresenting such holder’s Class B Shares to be exchanged.  In case fewer than the total number of ClassB Shares represented by any certificate are exchanged, a new certificaterepresenting the number of unexchanged Class B Shares shall be issued to theholder thereof without cost to such holder within three business days aftersurrender of the certificate representing the exchanged Class B Shares.

#####  

##### (c)                                  Issuanceof Exchange Shares.  The issuance ofcertificates for shares of Class C Preferred Stock, Class D Preferred Stock andClass A Common Stock issuable upon the exchange of Class B Preferred Stockshall be made without charge to the holders of the Class B Shares for anyissuance tax if issued in the name of such holder in respect thereof or othercost incurred by the Corporation in connection with such exchange and therelated issuance of shares of Class C Preferred Stock, Class D Preferred Stockand Class A Common Stock.  Upon theexchange of each Class B Shares, the Corporation shall take all such actions asare necessary in order to insure that the Exchange Shares issuable with respectto such

 

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conversion shall bevalidly issued, fully paid and nonassessable, free and clear of all taxes,liens, charges and encumbrances with respect to the issuance thereof.

#####  

##### (d)                                 Closingof Books.  The Corporation shall notclose its books against the transfer of Class B Preferred Stock or of any ClassC Preferred Stock, Class D Preferred Stock and Class A Common Stock issued orissuable upon the exchange of Class B Preferred Stock in any manner whichinterferes with the timely exchange of Class B Preferred Stock.  The Corporation shall assist and cooperatewith any holder of Class B Preferred Stock required to make any governmentalfilings or obtain any governmental approval prior to or in connection with anyconversion of Shares hereunder (including, without limitation, making anyfilings required to be made by the Corporation).

#####  

##### (e)                                  Reservationof Shares.  The Corporation shall atall times reserve and keep available out of its authorized but unissued sharesof Class C Preferred Stock, Class D Preferred Stock and Class A Common Stock,solely for the purpose of issuance upon the exchange of the Class B PreferredStock such number of shares of Class C Preferred Stock, Class D Preferred Stockand Class A Common Stock issuable upon the exchange of all outstanding sharesof Class B Preferred Stock.  All sharesof Class C Preferred Stock, Class D Preferred Stock and Class A Common Stockwhich are so issuable shall, when issued, be duly and validly issued, fullypaid and nonassessable and free from all taxes, liens and charges.  The Corporation shall take all such actionsas may be necessary to assure that all such shares of Class C Preferred Stock,Class D Preferred Stock and Class A Common Stock may be so issued withoutviolation of any applicable law or governmental regulation or any requirementsof any domestic securities exchange upon which shares of Class C PreferredStock, Class D Preferred Stock and Class A Common Stock may be listed (exceptfor official notice of issuance which shall be immediately delivered by theCorporation upon each such issuance). The Corporation shall not take any action which would cause the numberof authorized but unissued shares of Class C Preferred Stock, Class D PreferredStock or Class A Common Stock to be less than the number of such sharesrequired to be reserved hereunder for issuance upon exchange of the Class BPreferred Stock.

#####  

##### (f)                                    SurrenderedShares.  Any Class B Shares whichare exchanged pursuant to this Section 5 shall be canceled and retired toauthorized but unissued shares and shall not be reissued, sold or transferred.

#####  

##### (g)                                 RightsAfter Issuance of Exchange Shares. Each exchange of Class B Preferred Stock shall be deemed to have beeneffected as of the close of business on the date on which the certificaterepresenting the Class B Shares to be exchanged have been surrendered to theCorporation for exchange as set forth in the applicable Exchange Notice.  At the time any such exchange has beeneffected, the rights of the holders of the Class B Shares as holders of Class BPreferred Stock shall cease and such holders shall be deemed to have become theholders of record of the Exchange Shares issued in exchange therefor.  For the avoidance of doubt, dividends shallaccrue on each Class B Share up to the date on which the Exchange Sharesissuable pursuant to this Section 5 are issued.

 

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#### (6)                                  Redemptions.

####  

##### (a)                                  OptionalRedemption of Class C Preferred Stock. Subject to Section 6(b), at any time and from time to time theCorporation may redeem all or any lesser portion of the outstanding Class CPreferred Stock for a per share redemption price equal to the Class CLiquidation Amount calculated as of the applicable Redemption Date (as definedin Section 6(c) below).

#####  

##### (b)                                 MandatoryRedemption of Class C Preferred Stock. Promptly (but in no event later than the following business day) afterthe issuance of shares of Class C Preferred Stock in exchange for Class BShares surrendered to the Company in accordance with Section 5(a), theCorporation shall redeem all of such shares of Class C Preferred Stock for aper share redemption price equal to the Class C Liquidation Amount calculatedas of the applicable Redemption Date (as defined in Section 6(c) below).

#####  

##### (c)                                  RedemptionProcedure.  Not more than 15 daysprior to the date of any redemption of Series C Preferred Stock, theCorporation shall send written notice to each record holder of shares of SeriesC Preferred Stock notifying such holder of (i) the redemption to be effected,specifying the number of shares of Series C Preferred Stock to be redeemed fromeach holder (the “Redemption Shares”), (ii) the aggregate redemptionprice required to be paid to such holder under Section 6(a) or 6(b), asapplicable (the *“Redemption Price”*), and (iii) the date on which suchredemption shall be effected (each such date, a *“Redemption Date”*),and calling upon such holder to surrender to the Corporation, in the manner andat the place designated, the certificate or certificates representing suchholder’s Redemption Shares.  In the caseof any redemption to be effected pursuant to Section 6(b) above, such noticeshall be delivered together with the Exchange Notice delivered to the holdersof Class B Preferred Stock pursuant to Section 5(b), and in such case theholders of the Class B Preferred Stock to be exchanged shall be deemed,for purposes of this Section 6(c) only, to be holders of the Class C PreferredStock issuable upon the surrender of such Class B Shares.  In case fewer than the total number ofRedemption Shares represented by any certificate are redeemed, a newcertificate representing the number of unredeemed Redemption Shares shall beissued to the holder thereof without cost to such holder within three businessdays after surrender of the certificate representing the redeemed Redemption Shares.

#####  

##### (d)                                 RightsUpon Redemption.  After the paymentin full (in immediately available funds) of the Redemption Price with respectto any Redemption Share (as the case may be), all rights of the holder of suchRedemption Share shall cease, and the Redemption Share shall not be deemed tobe outstanding.  For the avoidance ofdoubt, dividends shall accrue on each share of Class C Preferred Stock up tothe date on which the Redemption Price of such share is paid in full inimmediately available funds.

#####  

##### (e)                                  Redeemedor Otherwise Acquired Shares.  Anyshares of Series C Preferred Stock which are redeemed or otherwise acquired bythe Corporation shall be canceled and retired to authorized but unissued sharesand shall not be reissued, sold or transferred.

 

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##### (f)                                    OtherRedemptions or Acquisitions.  TheCorporation shall not be entitled to redeem or otherwise acquire any Class BPreferred Stock or Class D Preferred Stock. Neither the Corporation nor any of its subsidiaries shall redeem orotherwise acquire any Preferred Stock, except as expressly authorized herein orpursuant to (i) Section 9.05 of the Stock Purchase Agreement dated as ofNovember 20, 2000, among the Corporation, Dr. Michael J. Hartnett, Hartnett FamilyInvestments, L.P. and Whitney Acquisition II, Inc., or (ii) Section 8.05 of thePreferred Stock Purchase Agreement dated as of the original Date of Issuance ofthe Class B Preferred Stock among the Corporation, Roller Bearing Company ofAmerica, Inc., Dr. Michael J. Hartnett and Whitney V, L.P.

#####  

#### (7)                                  VotingRights.  Except to the extentrequired by the General Corporation Law of the State of Delaware, the holdersof outstanding shares of Preferred Stock shall not be entitled to vote on anymatters to be voted on by the Corporation’s stockholders.

####  

#### (8)                                  ProtectiveProvisions.

####  

##### (a)                                  Withoutthe prior written consent of the holders of a majority of the then outstandingPreferred Stock, the Corporation shall not: (i) authorize or issue any sharesof capital stock having liquidation, dividend or distribution rights senior toor *paripassu* with the Class A Preferred Stock; (ii) authorize or issue anyshares of capital stock having liquidation, dividend or distribution rightssenior to the Class B Preferred Stock, the Class C Preferred Stock or the ClassD Preferred Stock (except that the Corporation may issues shares ofClass A Preferred Stock to the extent permitted under the following clause(iii)); (iii) issue any shares of Class A Preferred Stock other than pursuantto (A) Section 9.04 of the Stock Purchase Agreement dated as of November 20,2000, among the Corporation, Dr. Michael J. Hartnett, Hartnett FamilyInvestments, L.P. and Whitney Acquisition II, Inc., or (B) Section 8.04 of thePreferred Stock and Warrant Purchase Agreement dated as of the original Date ofIssuance of the Class B Preferred Stock among the Corporation, Roller BearingCompany of America, Inc., Dr. Michael J. Hartnett and Whitney V, L.P.; (iv)issue any shares of Class C Preferred Stock or Class D Preferred Stock otherthan pursuant to Section 4 or Section 5 of this Section B of ArticleFourth; or (iv) amend, modify or restate the provisions of this Section B ofthis Article Fourth in any respect.

#####  

##### (b)                                 Priorto or concurrently with the effectiveness of any Sale of the Corporation orLiquidation Event, the Board of Directors shall declare and authorize thepayment of all accumulated and accrued and unpaid but not yet accumulateddividends on the outstanding shares of Preferred Stock.

#####  

### C.                                     Rightsand Privileges of Common Stock. Except as otherwise provided herein, all shares of Class A Common Stockand Class B Common Stock will be identical and will entitle the holder thereofto the same rights and privileges.

###  

#### (1)                                  General.  The voting, dividend and liquidation rightsof the holders of the Common Stock are subject to and qualified by the rightsof the holders of the Preferred Stock set forth in Section B of Article Fourth.

 

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#### (2)                                  VotingRights.

####  

##### (a)                                  Theholders of Class A Common Stock will be entitled to one vote per share on allmatters to be voted on by the Corporation’s stockholders.

#####  

##### (b)                                 Untilone of the events described in subsections (i) through (iv) below (each, a “*VotingEvent*”) shall have occurred, the holders of Class B Common Stockwill be entitled to that number of votes per share on all matters to be votedupon by the Corporation’s stockholders as is required to entitle the holdersthereof, in the aggregate, to fifty-one percent (51%) of the voting power ofthe issued and outstanding Common Stock. Following the occurrence of a Voting Event, the holders of Class BCommon Stock will be entitled to one vote per share on all matters to be votedon by the Corporation’s stockholders.

#####  

###### (i)                                     TheCorporation (A) shall commence any proceeding under any bankruptcy,reorganization, arrangement, readjustment of debt, dissolution or liquidationlaw or statute of any jurisdiction, whether now or hereafter in effect; or (B)shall have had any such petition or application filed or any such proceedingshall have been commenced, against it, in which an adjudication or appointmentis made or order for relief is entered, or which petition, application orproceeding remains undismissed for a period of 60 days or more;

######  

###### (ii)                                  (A)Michael J. Hartnett shall (1) die, (2) be discharged from employmentwith the Corporation for Cause (as defined in any Employment Agreement betweenthe Corporation and Michael J. Hartnett (the “*Employment Agreement*”))or (3) terminate his Employment Agreement during the stated term thereoffor other than Good Reason (as defined in the Employment Agreement) or (B)ninety (90) days shall have passed after there shall have occurred a PermanentDisability with respect to Michael J. Hartnett.  For the purposes hereof, a “*Permanent Disability*” shall mean anyphysical or mental disability that permanently prevents Michael J. Hartnettfrom performing the essential functions, taken as a whole, of his position asChief Executive Officer of the Corporation and/or of its wholly ownedsubsidiaries;

######  

###### (iii)                               Atsuch time that Michael J. Hartnett and his Permitted Transferees shall have thepower to vote with respect to, or the power to dispose of, less than 50% of theshares of the Common Stock, on a fully diluted basis (i.e., assuming fullexercise of all such holders’ warrants, options and other rights to purchaseshares of Common Stock), owned by Michael J. Hartnett and Hartnett FamilyInvestments, L.P. on December 18, 2000 (subject to adjustment to reflectany stock split, stock dividend, reclassification, recapitalization or othertransaction having a similar effect); and

######  

###### (iv)                              thefirst underwritten public offering of equity securities of the Corporationpursuant to an effective registration statement under the Securities Act of1933, as amended (the “*Act*”), for which the Corporation shallhave received not less than $50 million in net proceeds and following whichthere is a public market for the securities so offered.

 

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For the purposes ofsubsection (iii), “*Permitted Transferee*” shall mean, withrespect to any Person, (a) if such Person is an individual, (i) a member of theImmediate Family of such Person, (ii) a trust or other similar legal entity forthe primary benefit of such Person and/or one or more members of his ImmediateFamily, or (iii) a partnership, limited partnership, limited liability company,corporation or other entity in which such Person alone or together with membersof his Immediate Family possess 100% of the outstanding voting securities, (b)a Person to whom Securities are Transferred in compliance with Rule 144 underthe Act, so long as Holdings is furnished with evidence reasonably satisfactoryto it that such Transfer complied with such rule, and (c) if such Person is nota natural person, (i) any Affiliate of such Person or (ii) any of such Person’sor its Affiliates’ stockholders, general partners, limited partners, members,directors, officers, or employees or their respective Affiliates to whomSecurities are Transferred.  For thepurposes of this definition, “*Immediate Family*”, with respect to anindividual, shall mean his brothers, sisters, spouse, children (includingadopted children), parents, parents-in-law, grandchildren, great grandchildrenand other lineal descendants and spouses of any of the foregoing, and “*Affiliate*”shall mean a person controlled by, in control of, or under common control with,another person.

 

#### (3)                                  Dividends.  Subject to the preferential rights of theholders of Preferred Stock, when, as and if dividends are declared, whetherpayable in cash, property or securities of the Corporation, the holders of bothClass A Common Stock and Class B Common Stock will be entitled to receive suchdividends, ratably according to the number of shares of Common Stock held bythem.

####  

#### (4)                                  RightsUpon Liquidation or Sale of the Corporation. In the event of anyliquidation, dissolution or winding up of the Corporation, the assets of theCorporation shall be distributed in accordance with Section B(3)(a) ofthis Article Fourth, and the rights of the holders of Common Stock toparticipate in any such distribution shall be subject to the rights andpreferences of the holders of the Preferred Stock set forth therein.  In connection with a Sale of theCorporation, the rights of the holder of Common Stock to receive considerationto be paid in connection with such transaction shall be subject toSection B(3)(b) of this Article FOURTH.

####  

#### (5)                                  Conversionof Class B Common Stock.

####  

##### (a)                                  Atany time and from time to time, each record holder of Class B Common Stock willbe entitled to convert any and all of the shares of such holder’s Class BCommon Stock into shares of Class A Common Stock on a one to one basis at suchholder’s election.

#####  

##### (b)                                 Atany time and from time to time that Michael J. Hartnett or any PermittedTransferee of Michael J. Hartnett shall transfer any shares of Class B CommonStock other than to a Permitted Transferee such shares of Class B Common Stockso transferred will automatically and without any further action be deemed tohave been converted into shares of Class A Common Stock on a one-to-onebasis.  Upon any such transfer, suchholder of shares of Class B Common Stock shall be obligated to effect theprocedures described in paragraphs (c)

 

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through (f) below; *provided*,*however*,that such conversion shall be deemed to have occurred regardless of suchholder’s compliance therewith.

#####  

##### (c)                                  Eachconversion of shares of Class B Common Stock into shares of Class A CommonStock will be effected by the surrender of the certificate or certificatesrepresenting the shares to be converted at the principal office of theCorporation (or such other office or agency of the Corporation as theCorporation may designate by notice in writing to the holder or holders of theClass B Common Stock) at any time during normal business hours, together with awritten notice by the Holder of such Class B Common Stock stating that suchholder desires to convert the shares, or a stated number of the shares, ofClass B Common Stock represented by such certificate or certificates into ClassA Common Stock.  Such conversion will bedeemed to have been effected as of the close of business on the date on whichcertificate or certificates have been surrendered and such notice has beenreceived, and at such time the rights of the holder of the converted Class BCommon Stock as such will cease and the person or persons in whose name ornames the certificate or certificates for shares of Class A Common Stock are tobe issued upon such conversion will be deemed to have become the holder orholders of record of the shares of Class A Common Stock represented thereby.

#####  

##### (d)                                 Promptlyafter such surrender and the receipt of such written notice, the Corporationwill issue and deliver in accordance with the surrendering holder’sinstructions (i) the certificate or certificates for the Class A Common Stockissuable upon such conversion and (ii) a certificate representing any Class BCommon Stock which was represented by the certificate or certificates deliveredto the Corporation in connection with such conversion but which was notconverted.

#####  

##### (e)                                  TheCorporation will at all times reserve and keep available out of its authorizedbut unissued shares of Class A Common Stock or its treasury shares, solely forthe purpose of issue upon the conversion of the Class B Common Stock asprovided in this Section (C)(3), such number of shares of Class A Common Stockas shall then be issuable upon the conversion of all then outstanding shares ofClass B Common Stock.

#####  

##### (f)                                    Theissuance of certificates for Class A Common Stock upon the conversion of ClassB Common Stock will be made without charge to the holders of such shares forany issuance tax in respect thereof or other cost incurred by the Corporationin connection with such conversion and the related issuance of Class A CommonStock.  The Corporation will not closeits books against the transfer of Class B Common Stock or of Class A CommonStock issued or issuable upon the conversion of Class B Common Stock in anymanner which would interfere with the timely conversion of Class B CommonStock.

#####  

#### (6)                                  PreemptiveRights.  No holder of shares ofCommon Stock shall be entitled to the preemptive right to subscribe to any orall additional issues of stock of the Corporation of any or all classes orseries thereof, or to any securities of the Corporation convertible into, orexchangeable or exercisable for, such stock, except to the extent set forth inthe Amended and Restated Stockholders’ Agreement, dated as of the date hereof(the

 

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*“Stockholders’ Agreement”*), by andamong the Corporation and certain of its stockholders, as the same may beamended from time to time.

####  

#### (7)                                  BusinessCombinations With Interested Stockholders. The Corporation shall not be governed by the provisions of Section 203of the Delaware General Corporation Law.

####  

## FIFTH: Amendment of Bylaws.

##  

### In furtherance and not in limitation of the powersconferred by statute, the Board of Directors is expressly authorized to make,repeal, alter, amend and rescind the bylaws of the Corporation, subject to thereceipt of the requisite vote of the stockholders, if any, pursuant to ArticleFourth above.

 

## SIXTH: Election of Directors.

##  

### Elections of directors need not be by written ballotunless the bylaws of the Corporation shall so provide.

 

## SEVENTH: Amendment of Certificate of Incorporation.

##  

### Subject to the receipt of the requisite vote of thestockholders, if any, pursuant to Article Fourth above, the Corporationreserves the right to amend, alter, change or repeal any provision contained inthis Certificate of Incorporation, in the manner now or hereafter prescribed bystatute, and all rights conferred on stockholders herein are granted subject tothis reservation.

 

## EIGHTH: Liability and Indemnification.

##  

### A.                                   TheCorporation shall indemnify, in the manner and to the full extent permitted bylaw, any person (or the estate of any person) who was or is a party to, or isthreatened to be made a party to any threatened, pending or completed action,suit or proceeding, whether or not by or in the right of the Corporation, andwhether civil, criminal, administrative, investigative or otherwise, by reasonof the fact that such person is or was a director, officer, employee or agentof the Corporation, or is or was serving at the request of the Corporation as adirector, officer, employee, agent or fiduciary of another corporation,partnership, joint venture, trust or other enterprise.  The Corporation may, to the full extentpermitted by law, purchase and maintain insurance on behalf of any such personagainst any liability which may be asserted against him.  To the full extent permitted by law, theindemnification provided herein shall include expenses (including attorneys’fees), judgments, fines and amounts paid in settlement, and, in the mannerprovided by law, any such expenses shall be paid by the Corporation in advanceof the final disposition of such action, suit or proceeding upon receipt of anundertaking by or on behalf of the person seeking indemnification to pay suchamounts if it is ultimately determined that he is not entitled to beindemnified.  The indemnificationprovided herein shall not be deemed to limit the right of the Corporation toindemnify any other person for any such expenses to the full extent permittedby law, nor shall it be deemed exclusive of any other rights

 

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to which any personseeking indemnification from the Corporation may be entitled under anyagreement, vote of stockholders or disinterested directors or otherwise, bothas to action in his official capacity and as to action in another capacitywhile holding such office.

###  

### B.                                     Adirector of the Corporation shall not be liable to the Corporation or itsstockholders for monetary damages for breach of fiduciary duty as a director,except to the extent such exemption from liability or limitation thereof is notpermitted under the Delaware General Corporation Law as the same exits or mayhereafter be amended.

###  

### C.                                     Anyrepeal or modification of Section B of this Article EIGHTH shall not adverselyaffect any right or protection of a director of the Corporation existing hereunderwith respect to any act or omission occurring prior to such repeal ormodification.

###  

#### IN WITNESS WHEREOF, the undersigned has executed thisAmended and Restated Certificate of incorporation on behalf of the Corporationand does hereby verify and affirm, under penalty of perjury, that this Amendedand Restated Certificate of Incorporation is the act and deed of theCorporation and that the facts stated herein are true as of March   ,2003.

 
|   |   | ROLLER BEARING HOLDING  COMPANY, INC. |
|--------|--------|---------------------------------------|
|   |   |                                  |
|   |   |                                  |
|   |   | By:                                   | /s/ Michael J. Hartnett |   |
|   |   |                                  | Name: Michael J.  Hartnett |
|   |   |                                  | Title: President |

 

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