Exhibit 10.2



 


Exhibit
10.2


 


EXHIBIT
B


 


The
undersigned Daniel Wiesel, hereby certifies that:


 


1.
He is the Chairman of the Board of Directors and the Chief Executive Officer of The PAWS Pet Company, Inc., an Illinois
corporation (the “Corporation”).


 


2.
The Corporation is authorized to issue 10,000,000 shares of preferred stock, none of which are issued or outstanding.


 


3.
That on March 9th 2013, the following resolutions were duly adopted by the Board of Directors:


 


WHEREAS,
the Amended and Restated Articles of Incorporation, as amended to date, of the Corporation provide for a class of its authorized
stock known as preferred stock, comprised of 10,000,000 shares, no par value per share (the “Preferred Stock”),
issuable from time to time in one or more series;


 


WHEREAS,
the Board of Directors of the Corporation is authorized to fix the dividend rights, dividend rates, voting rights, conversion
rights, rights and terms of redemption and liquidation preferences of any wholly unissued series of Preferred Stock and the number
of shares constituting any series and designation thereof, of any of them;


 


NOW,
THEREFORE, BE IT RESOLVED, that the Board of Directors of the Corporation does hereby authorize this Certificate of Designation
OF SERIES B CONVERTIBLE PREFERRED STOCK to provide for the issuance of a series of Preferred Stock for cash or exchange of other
securities, rights or property and does hereby fix and determine the rights, preferences, restrictions and other matters relating
to such series of Preferred Stock as follows:


 


TERMS
OF PREFERRED STOCK


 


ARTICLE
I. Designation, Amount and Par Value.


 


Section
1.01 The series of Preferred Stock shall be designated as the Corporation’s Series B Convertible Preferred Stock (the
“Series B Stock”) and the number of shares so designated shall be eighty thousand (80,000), which shall not
be subject to increase without the affirmative vote or written consent of the holders (each a “Holder” and
collectively, the “Holders”) of at least sixty-seven percent (67%) of the Series B Stock issued and outstanding
at the time of any such vote or written consent. Each share of Series B Stock shall have no par value per share.


 


ARTICLE
II. Ranking.


 


Section
2.01 The Series B Stock shall be, with respect to dividend rights and rights upon liquidation, winding-up or dissolution,
rank:


 


	(a)		Senior to the Corporation’s
Common A Stock, no par value per share (“Common Stock”); and
	 	 	 
	(b)		Senior to any and all other
classes or series of Preferred Stock of the Corporation, whether authorized now, or at any time in the future, unless any such
subordination to any other class or series of Preferred Stock, is expressly agreed to, pursuant to an affirmative vote or written
consent of Holders of at least sixty-seven percent (67%) of the Series B Stock issued and outstanding at the time of any such
vote or written consent.



 




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ARTICLE
III. Liquidation Rights.


 


Section
3.01 With respect to rights on Liquidation (as defined in Section 3.02 of this Article III), the Series B Stock shall rank
senior and prior to the any and all classes of series of the Corporation’s common stock and to any and all other classes
or series of preferred stock of the Corporation, except as otherwise approved by the affirmative vote or written consent of the
Holders of at least a sixty-seven percent (67%) of the Series B Stock issued and outstanding at the time of any such vote or written
consent. Furthermore, the Corporation may not designate any other class or series of common stock or preferred stock without first
obtaining the affirmative vote or consent of the Holders of at least sixty-seven percent (67%) of the Series B Stock issued and
outstanding at the time of any such vote or written consent.


 


Section
3.02 In the event of any liquidation, dissolution or winding-up of the affairs of the Corporation (collectively, a
“Liquidation”), the sole participation to which the Holders of shares of Series B Stock then issued and
outstanding (the “Series B Stockholders”) shall be entitled, out of the assets of the Corporation legally
available for distribution to its stockholders, whether from capital, surplus or earnings, to receive, before any payment
shall be made to the holders of the Common Stock or any other class or series of preferred stock ranking on Liquidation
junior to such Series B Stock, an amount per share equal to the Face Value (as hereinafter defined). If upon any such
Liquidation, the remaining assets of the Corporation available for distribution to its shareholders shall be insufficient to
pay the Holders of shares of Series B Stock the full amount to which they shall be entitled, the Holders of shares of Series
B Stock, and of any class or series of stock ranking upon liquidation on a parity with the Series B Stock, shall share pari
passu in any distribution of the remaining assets and funds of the Corporation in proportion to the respective liquidation
amounts that would otherwise be payable to the Holders of preferred stock with respect to the shares held by them upon such
distribution if all amounts payable on or with respect to such shares were paid in full.


 


ARTICLE
IV. Restrictive Legend. 


 


Section
4.01 Any Series B Stock certificate issued in reference to this designation shall bear on its face the following restrictive
legend:


 


THE
SHARES REPRESENTED BY THE CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES
LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED UNLESS, IN THE OPINION OF COUNSEL SATISFACTORY TO THE ISSUER, THE
TRANSFER QUALIFIES FOR AN EXEMPTION FROM OR EXEMPTION TO THE REGISTRATION PROVISIONS THEREOF.


 


Section
4.02 For purposes of this CERTIFICATE OF DESIGNATION OF SERIES B CONVERTIBLE PREFERRED STOCK, the term “Valid Exemption
From or To Registration” shall mean, an exemption from or to registration, under the Securities Act of 1933 and applicable
state securities laws and then, only after receipt, by the Corporation, its Transfer Agent and the Holder, of an opinion of counsel
which clearly states that such an exemption is available to the Holder.


 




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ARTICLE
V. Conversion and Face Value.


 


Section
5.01 Any Holder of Series B Stock shall have the right to convert any or all of the Holder’s Series B Stock into a number
of fully paid and non-assessable shares of Common Stock for each share of Series B Stock so converted, as set forth in this Article
V.


 


	(a)		Any Series B Stockholder may
exercise the right to convert such shares into Common Stock pursuant to this Article V by delivering to the Corporation during
regular business hours, at the office of the Corporation or any transfer agent of the Corporation or at such other place as may
be designated by the Corporation, the certificate or certificates for the shares to be converted (the “Series B Preferred
Certificate”), duly endorsed or assigned in blank to the Corporation (if required by it).
	 	 	 
	(b)		Each Series B Preferred Certificate
shall be accompanied by written notice (the “Conversion Demand”) stating that such Holder elects to convert
such shares and stating the name or names (with address) in which the certificate or certificates for the shares of Common Stock
(the “Common Certificate”) are to be issued. Such conversion shall be deemed be effected on the date when such
delivery is made, and such date is referred to herein as the “Conversion Date.”
	 	 	 
	(c)		As promptly as practicable
thereafter, the Corporation shall issue and deliver to or upon the written order of such Holder, at the place designated by such
Holder, a certificate or certificates for the number of shares of Common Stock calculated pursuant to this Article V, to which
such Holder is entitled.
	 	 	 
	(d)		The person in whose name the
certificate or certificates for Common Stock are to be issued shall be deemed to have become a Holder of record of Common Stock
on the applicable Conversion Date, unless the transfer books of the Corporation are closed on such Conversion Date, in which event
the Holder shall be deemed to have become the stockholder of record on the next succeeding date on which the transfer books are
open, provided that the Conversion Ratio (as hereinafter defined) shall be the Conversion Ratio in effect on the Conversion Date.
	 	 	 
	(e)		Upon conversion of only a portion
of the number of shares covered by a Series B Preferred Certificate, the Corporation shall issue and deliver to, or upon the written
order of, the Holder of such Series B Preferred Certificate, at the expense of the Corporation, a new certificate covering the
number of shares of the Series B Stock representing the unconverted portion of the Series B Preferred Certificate, which new certificate
shall entitle the Holder thereof to all the rights, powers and privileges of a Holder of such shares.
	 	 	 
	(f)		The number of shares of Common
Stock to be issued pursuant to a Conversion Demand shall be the number that is equal to 0.001% of the number of shares of the
Common Stock that would be issued and outstanding after the hypothetical conversion and issuance of all of the outstanding shares
of any and all classes of convertible stock and/or any and all other convertible debt instruments, options and/or warrants outstanding
at the time the Conversion Demand (the “Conversion Ratio”).



 


	(i) 		Any fractional shares calculated
and issued pursuant to Section 5.01(f) shall be rounded up to the nearest whole share.
	 	 	 
	(ii)		In no event shall the Conversion
Ratio be less than four thousand, three hundred (4,300) shares of Common Stock (the “Minimum Conversion Ratio”)
and in no event shall the Conversion Ratio be more than ten thousand (10,000) shares of Common Stock (the “Maximum Conversion
Ratio”).



 


Section
5.02 The Corporation shall pay all documentary, stamp or other transactional taxes (excluding income taxes) attributable to
the issuance or delivery of shares of capital stock of the Corporation upon conversion of any shares of Series B Stock; provided,
however, that the Corporation shall not be required to pay any taxes which may be payable in respect of any transfer involved
in the issuance or delivery of any certificate for such shares in a name other than that of the Holder of the Series B Stock in
respect of which such shares of Common Stock are being issued.


 




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Section
5.03 The Corporation shall reserve out of its authorized, but unissued, shares of Common Stock, solely for the purpose of
effecting the conversion of the Series B Stock, sufficient shares of Common Stock to provide for the conversion of all outstanding
shares of Series B Stock.


 


Section
5.04 All shares of Common Stock which may be issued in connection with the conversion provisions set forth herein will, upon
issuance by the Corporation, be validly issued, fully paid and non-assessable, not subject to any preemptive or similar rights
and free from all taxes, liens or charges with respect thereto created or imposed by the Corporation.


 


Section
5.05 In no event, shall a Holder of any Series B Stock be allowed to convert such shares of Series B Stock into Common Stock
which, upon giving effect to such conversion, would cause the aggregate number of shares of Common Stock beneficially owned by
the Holder, and/or its affiliates, to exceed four and nine tenths percent (4.9%) of the currently issued and outstanding shares
of the Corporation. In reference to the written notice of election to convert required by Article V Section 5.01 (b) above, the
Holder shall affirm in that notice, under penalty of perjury, the exact number of shares held by the Holder on the date of the
notice and the Corporation shall have the right to reduce any demand for conversion by a number such that the total number of
shares of Common Stock held by the Holder after conversion will not exceed four and nine tenths percent (4.9%) of the currently
issued and outstanding shares of Common Stock of the Corporation.


 


Section
5.06 Notwithstanding the limitations on conversion contained within Section 5.05 above, the limitations on conversion contained
therein may be waived, in the sole discretion of the Holder upon, and at the election of the Holder, not less than sixty-one (61)
days’ prior notice to the Company, and the provisions of the conversion limitation shall continue to apply until such sixty-first
(61st) day (or such later date, as determined by the Holder, as may be specified in such notice of waiver).


 


Section
5.07 In the event that the Company shall at any time subdivide the outstanding shares of Common Stock, or shall issue a stock
dividend on the outstanding Common Stock, the Minimum and Maximum Conversion Ratios in effect immediately prior to such subdivision
or the issuance of such dividend shall be proportionately increased and shall continue to be proportionately increased through
any subsequent subdivision, subdivisions, issuance or issuances.


 


Section
5.08 In no event may the Corporation combine or divide the number of shares of Series B Stock outstanding, nor change the
authorized number of shares of Series B Stock, except as otherwise approved by the affirmative vote or written consent of the
Holders of at least a sixty-seven percent (67%) of the Series B Stock issued and outstanding at the time of any such vote or written
consent.


 


Section
5.09 As used herein, the term “Face Value” shall mean Thirty Dollars ($30.00) per share of Series B Stock.


 


ARTICLE
VI. Voting Rights.


 


Section
6.01 A Holder of Series B Stock shall not be entitled to vote on any matter presented to the Common stockholders of the Company
for their action or consideration.


 


Section
6.02 Series B Stockholders are entitled to vote only on matters relating to modifications, adjustments, waivers or other changes
or matters relating to Series B Stock. Each Series B Stock share shall have one (1) vote on matters relating to Series B Stock.


 




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ARTICLE
VII. Certain Covenants.


 


Section
7.01 Any Holder of Series B Stock may proceed to protect and enforce its rights and the rights of such Holders by any available
remedy by proceeding at law or in equity, whether for the specific enforcement of any provision in this Certificate of Designation
or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.


 


ARTICLE
VIII. Dividends.


 


Section
8.01 The Series C Stock shall not be entitled to dividends.


 


ARTICLE
IX. Notice to the Corporation.


 


Section
9.01 All notices and other communications required or permitted to be given to the Corporation hereunder shall be made by
first-class mail, postage prepaid, to the Corporation at its principal executive offices as may be fixed from time to time by
the Board of Directors. Any notice to a Holder shall me made to their address as set forth on the books and records of the Corporation.


 


	 	PAWS PET COMPANY, INC.
	 	 	 
	 	By: 	/s/
    Daniel Wiesel
	 	 	 Daniel
    Wiesel, Chairman & CEO


 


Dated:
March 15, 2013


 








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