such Dividend Date. Dividends shall be payable in cash.
(3)
Conversion.
Shares of Series A Preferred
Stock shall be convertible into the Company's common shares, $0.001 par value
per share (the "Common Shares"), on the terms and conditions set forth in this
Section 3.
(A)
CERTAIN DEFINED TERMS.
FOR PURPOSES OF
THIS CERTIFICATE OF DESIGNATIONS, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING
MEANINGS:
(I)
"ADDITIONAL AMOUNT" MEANS, ON A PER
PREFERRED SHARE BASIS, THE PRODUCT OF (X) THE RESULT OF THE FOLLOWING FORMULA:
(DIVIDEND RATE)(N/360) AND (Y) THE STATED VALUE.
(II)
"APPROVED ACQUISITIONS" MEANS
(A) ACQUISITIONS BY THE COMPANY OR ITS SUBSIDIARIES OF A BUSINESS ENTERPRISE OR
ASSETS OR (B) JOINT VENTURES BY THE COMPANY WITH THIRD PERSONS.
(III)
"APPROVED SHARE PLAN" MEANS ANY EMPLOYEE
BENEFIT PLAN WHICH HAS BEEN APPROVED BY THE BOARD OF DIRECTORS OF THE COMPANY,
PURSUANT TO WHICH THE COMPANY'S SECURITIES MAY BE ISSUED TO ANY EMPLOYEE,
OFFICER, CONSULTANT OR DIRECTOR FOR SERVICES PROVIDED TO THE COMPANY.
(IV)
"BLOOMBERG" MEANS BLOOMBERG FINANCIAL MARKETS.
(V)
"BUSINESS DAY" MEANS ANY DAY OTHER THAN
SATURDAY, SUNDAY OR OTHER DAY ON WHICH COMMERCIAL BANKS IN THE CITY OF NEW YORK
ARE AUTHORIZED OR REQUIRED BY LAW TO REMAIN CLOSED.
(VI)
"CALENDAR QUARTER" MEANS EACH OF THE FOLLOWING
PERIODS:
THE PERIOD BEGINNING ON AND INCLUDING JANUARY 1 AND ENDING ON AND
INCLUDING MARCH 31; THE PERIOD BEGINNING ON AND INCLUDING APRIL 1 AND ENDING ON
AND INCLUDING JUNE 30; THE PERIOD BEGINNING ON AND INCLUDING JULY 1 AND ENDING
ON AND INCLUDING SEPTEMBER 30; AND THE PERIOD BEGINNING ON AND INCLUDING
OCTOBER 1 AND ENDING ON AND INCLUDING DECEMBER 31.
(VII)
"CHERISH AND RESO BUSINESS" MEANS (I) THE
BUSINESS OF CHERISH, INC., A FLORIDA CORPORATION AND ITS SUBSIDIARIES AS OF THE
SUBSCRIPTION DATE AND (II) THE BUSINESS OF REAL ESTATE SCHOOL ONLINE INC. AND
ITS SUBSIDIARIES AS OF THE SUBSCRIPTION DATE.
(VIII)
"CHANGE OF CONTROL" MEANS ANY FUNDAMENTAL
TRANSACTION OTHER THAN (A) ANY REORGANIZATION, RECAPITALIZATION OR
RECLASSIFICATION IN WHICH HOLDERS OF THE COMPANY'S VOTING POWER IMMEDIATELY
PRIOR TO SUCH REORGANIZATION, RECAPITALIZATION OR RECLASSIFICATION CONTINUE
AFTER SUCH REORGANIZATION, RECAPITALIZATION OR RECLASSIFICATION TO HOLD PUBLICLY
TRADED SECURITIES AND, DIRECTLY OR INDIRECTLY, THE VOTING POWER OF THE SURVIVING
ENTITY OR ENTITIES NECESSARY TO ELECT A MAJORITY OF THE MEMBERS OF THE BOARD OF
DIRECTORS (OR THEIR EQUIVALENT IF OTHER THAN A CORPORATION) OF SUCH ENTITY OR
ENTITIES, (B) PURSUANT TO A MIGRATORY MERGER EFFECTED SOLELY FOR THE PURPOSE OF
CHANGING THE JURISDICTION OF INCORPORATION OF THE COMPANY OR (C) A FUNDAMENTAL
TRANSACTION THAT HAS BEEN PREVIOUSLY AUTHORIZED BY A WRITTEN CONSENT OF
2
THE REQUIRED HOLDERS PRIOR TO THE CONSUMMATION OF SUCH FUNDAMENTAL TRANSACTION.
(IX)
"CLOSING BID PRICE" AND "CLOSING SALE PRICE"
MEANS, FOR ANY SECURITY AS OF ANY DATE, THE LAST CLOSING BID PRICE AND LAST
CLOSING TRADE PRICE, RESPECTIVELY, FOR SUCH SECURITY ON THE PRINCIPAL MARKET, AS
REPORTED BY BLOOMBERG, OR, IF THE PRINCIPAL MARKET BEGINS TO OPERATE ON AN
EXTENDED HOURS BASIS AND DOES NOT DESIGNATE THE CLOSING BID