Document:

exhibit_4-1.htm

Exhibit 4.1

 

 

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CERTIFICATE OF DESIGNATION OF SERIES A REDEEMABLE PREFERRED STOCK

 

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Willamette Valley Vineyards, Inc., an Oregon corporation (the “Corporation”), hereby certifies that pursuant to the authority vested in the Board of Directors of the Corporation by the provisions of its Articles of Incorporation, as amended, and by and pursuant to ORS 60.341, the Board of Directors adopted the following Resolution effective as of June 22, 2015:

 

RESOLVED, that pursuant to Article II of the Corporation’s Articles of Incorporation, as amended, the Board of Directors hereby designates a new series of preferred stock and the number of shares constituting such series and fixes the rights, powers, preferences, privileges and the qualifications, limitations and restrictions relating to such series as set forth in Attachment A.

 

I, being the duly authorized President and Chairperson of the Board of Directors of the Corporation, do hereby certify under penalty of perjury that the foregoing resolution amending the Willamette Valley Vineyards, Inc. Articles of Incorporation, as amended, is the act and deed of the Corporation and that the facts stated herein are true and, accordingly, have hereunto set my hand this 22nd day of June, 2015.

 

 

 

	
 

	
By: 

	/s/ James W. Bernau	 
	 	 	James W. Bernau, President and Chairperson of the	 
	 	 	
Board of Directors

	 
	 	 	
Willamette Valley Vineyards, Inc.

	 

 

	
 

	
Attest:

	/s/ Craig Smith	 
	 	 	
Craig Smith, Secretary

	 

  

Page 1 of 4

Certificate of Designation of Series A Redeemable Preferred Stock

  

ATTACHMENT A

 

_______________

 

Certificate of Designation of the Preferences, Limitations, and Relative Rights of the

Series A Redeemable Preferred Stock of

Willamette Valley Vineyards, Inc.

 

_______________

 

1.           Designation and Number. The designation of such preferred shares, no par value, is “Series A Redeemable Preferred Stock” (the “Series A Redeemable Preferred Stock”). The total number of authorized shares of Series A Redeemable Preferred Stock shall be 1,445,783.

 

2.           Dividends.  The Corporation shall not declare, pay or set aside any dividends on shares of Common Stock unless the holders of the Series A Redeemable Preferred Stock then issued and outstanding shall first receive, or simultaneously receive, a dividend on each issued and outstanding Series A Redeemable Preferred Stock in an amount at least equal to the Series A Preferred Return Dividend.  As used herein and with respect to each share of Series A Redeemable Preferred Stock, the “Series A Preferred Return Dividend” shall mean an annual cumulative cash dividend, whether or not declared by the Board, in an amount equal to 5.3% of the applicable Series A Original Issue Price (defined below) per annum.  The Series A Preferred Return Dividend with respect to a share of Series A Redeemable Preferred Stock shall commence on the first day of the calendar quarter following the issuance of such share, and shall accrue and be earned with respect to each share of Series A Redeemable Preferred Stock on a daily basis, on a 365/366 day year, as the case may be.  The “Series A Original Issue Price” shall mean USD $4.15 per share subject to appropriate adjustment in the event of any bonus issue, share dividend, share split, subdivision, consolidation, combination or other similar recapitalization with respect to the Series A Redeemable Preferred Stock.  No right shall accrue to the holders of shares of Series A Redeemable Preferred Stock by reason of the fact that dividends on said shares are not declared in any prior year, nor shall any undeclared or unpaid dividend bear or accrue any interest.

 

3.           Liquidation.

 

(a)           Payment of the Series A Preferred Preference.  In the event of any Liquidation Event (defined below), the holders of Series A Redeemable Preferred Stock then issued and outstanding shall be entitled to be paid out of the assets of the Corporation available for distribution to its shareholders before any payment shall be made to the holders of Common Stock by reason of their ownership thereof, an amount per share equal to the sum of (i) the Series A Original Issue Price, (ii) the Series A Preferred Return Dividend, and (iii) any other accrued and unpaid dividends (whether or not declared) thereon.  If the assets of the Corporation available for distribution among the holders of the Series A Redeemable Preferred Stock in accordance with this Section 3(a) shall be insufficient to permit the payment to such holders of their full aforesaid preferential amount, then the entire amount of assets of the Corporation available for such distribution shall be distributed ratably among the holders of the Series A Redeemable Preferred Stock in proportion to the aggregate preferential amount each holder would otherwise be entitled to receive.

 

 

  

Page 2 of 4

Certificate of Designation of Series A Redeemable Preferred Stock

  

 

(b)           Payment to Holders of Common Stock.  In the event of any Liquidation Event, after the payment of all preferential amounts required to be paid to the holders of Series A Redeemable Preferred Stock pursuant to Section 3(a), the remaining assets of the Corporation available for distribution to its shareholders shall be distributed among the holders of shares of Common Stock, pro rata based on the number of shares held by each such holder.

 

(c)           Liquidation Event.  For purposes of this Section 3, “Liquidation Event” shall mean any reorganization or merger of the Corporation with or into any other corporation or corporations, in which the shareholders of the Corporation immediately prior to the transaction hold less than a majority of the voting stock immediately after the transaction, or any transaction or series of transactions resulting in the sale, transfer, lease or other disposition (but not including a transfer by pledge or mortgage to a bona fide lender) of all or substantially all of the assets of the Corporation (other than to a wholly-owned subsidiary) or any transaction or series of related transactions to which the Corporation is a party in which the shareholders of the Corporation immediately prior to the transaction hold less than a majority of the voting stock immediately after the transaction.

 

4.           Voting. The Series A Redeemable Preferred Stock shall be nonvoting in all matters other than those matters where voting is specifically required by the Oregon Business Corporation Act. As to all matters for which voting by class is specifically required by the Oregon Business Corporation Act, each outstanding share of Series A Redeemable Preferred Stock shall be entitled to one vote.

 

5.           Series A Redeemable Preferred Stock Protective Provisions.  So long as any shares of Series A Redeemable Preferred Stock are outstanding, the Corporation shall not, either directly or indirectly by amendment, amalgamation, merger, consolidation or otherwise, without the affirmative vote of the holders of at least a majority of the then issued and outstanding shares of Series A Redeemable Preferred Stock given in writing or by vote at a meeting, voting separately as a series pay any dividend or establish or maintain any sinking fund on any Common Stock or any class of preferred stock that is pari passu with or junior to the Series A Redeemable Preferred Stock.

 

6.           Conversion.  The Series A Redeemable Preferred Stock is not convertible into Common Stock.

 

7.           Redemption.

 

(a)           At any time after June 1, 2020, the Corporation shall have the option, but not the obligation, to redeem all, but not less than all, of the shares of Series A Redeemable Preferred Stock out of funds lawfully available therefor at a price per share equal to the applicable Series A Original Issue Price, plus all accrued but unpaid Series A Preferred Return Dividends thereon, plus an amount equal to three percent (3%) of the applicable Series A Original Issue Price (the “Redemption Price”), in one lump-sum payment due not more than sixty days after the written notice is delivered to holders of the Series A Redeemable Preferred Stock (the “Redemption Date”).  On the Redemption Date, the Corporation shall redeem all, but not less than all, of the outstanding shares of Series A Redeemable Preferred Stock owned by each holder.

 

 

  

Page 3 of 4

Certificate of Designation of Series A Redeemable Preferred Stock

  

 

(b)           Redemption Notice.  Written notice of the redemption (the “Redemption Notice”) shall be sent to each holder of shares of Series A Redeemable Preferred Stock not less than thirty (30) days prior to the Redemption Date.  Each Redemption Notice shall state:

 

(i)           the number of shares of Series A Redeemable Preferred Stock held by the holder that the Corporation shall redeem on the Redemption Date specified in the Redemption Notice;

 

(ii)           the Redemption Date and the Redemption Price; and

 

(iii)           that the holder is to surrender to the Corporation, in the manner and at the place designated, his, her or its certificate or certificates representing the shares of Series A Redeemable Preferred Stock to be redeemed.

 

(c)           Surrender of Certificates; Payment.  On or before the Redemption Date, each holder of Series A Redeemable Preferred Stock shall surrender the certificate or certificates representing such shares (or, if such registered holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate) to the Corporation, in the manner and at the place designated in the Redemption Notice, and thereupon the Redemption Price for such shares shall be payable to the order of the person whose name appears on such certificate or certificates as the owner thereof.

 

(d)           Rights Subsequent to Redemption.  If the Redemption Notice shall have been duly given, and if on the applicable Redemption Date the Redemption Price payable upon redemption of the Series A Redeemable Preferred Stock to be redeemed on such Redemption Date is paid or tendered for payment or deposited with an independent payment agent so as to be available therefor, then notwithstanding that the certificates evidencing any of the shares of Series A Redeemable Preferred Stock so called for redemption shall not have been surrendered, dividends with respect to such shares of Series A Redeemable Preferred Stock shall cease to accrue after such Redemption Date and all rights with respect to such shares of Series A Redeemable Preferred Stock shall forthwith after the Redemption Date terminate, except only the right of the holders to receive the Redemption Price without interest upon surrender of their certificate or certificates therefor.

 

(e)           Redeemed or Otherwise Acquired Shares.  Shares of Series A Redeemable Preferred Stock that are redeemed or otherwise acquired by the Corporation or any of its subsidiaries shall be automatically and immediately cancelled and retired and shall not be reissued, sold or transferred.

 

8.           Amendment. This Certificate of Designation constitutes an agreement between the Corporation and the holders of the Series A Redeemable Preferred Stock and may be amended or any term hereof waived only by the affirmative vote of the Board of Directors of the Corporation and the holders of a majority of the outstanding shares of Series A Redeemable Preferred Stock.

 

 

 

 

 

 

 

 Page 4 of 4 

Certificate of Designation of Series A Redeemable Preferred Stockexhibit_4-3.htm

Exhibit 4.3

 

 

 

 

ESCROW AGREEMENT

 

 

This ESCROW AGREEMENT (the "Agreement") dated as of this 15 day of July 2015, between Willamette Valley Vineyards (the "Company") and OTR, Inc., (the “Escrow Agent").

 

RECITALS

 

The Company desires to establish an escrow account with the Escrow Agent and the Escrow Agent is willing to open, maintain, and administer such escrow account in accordance with the terms and conditions set forth in this Agreement

 

NOW, THEREFORE, IT IS AGREED as follows:

 

1.          Duties of Escrow Agent.

 

The duties of OTR, Inc. should be set forth in this section in sufficient detail.

 

This is the heart of the Agreement.

 

2.          Acceptance by Escrow Agent. The Escrow Agent hereby accepts and agrees to perform its obligations hereunder, provided that:

 

(a)          The Escrow Agent may act in reliance upon any signature believed by it to be genuine, and may assume that any person who has been designated by the Company to give any written instructions, notice or receipt, or make any statements in connection with the provisions hereof has been duly authorized to do so. Escrow Agent shall have no duty to make inquiry as to the genuineness, accuracy or validity of any statements or instructions or any signatures on statements or instructions. The names and true signatures of each individual authorized to act singly on behalf of the Company are stated in Schedule I, which is attached hereto and made a part hereof. The Company may remove or add one or more of its authorized signers stated on Schedule I by notifying the Escrow Agent of such change in accordance with this Agreement, which notice shall include the true signature for any new authorized signatories.

 

(b)          The Escrow Agent may act relative hereto in reliance upon advice of counsel in reference to any matter connected herewith. The Escrow Agent shall not be liable for any mistake of fact or error of judgment or law, or for any acts or omissions of any kind, unless caused by its willful misconduct or gross negligence.

 

(c)          The Company agree to indemnify and hold the Escrow Agent harmless from and against any and all claims, losses, costs, liabilities, damages, suits, demands, judgments or expenses, including but not limited to reasonable attorney's fees, claimed against or incurred by Escrow Agent arising out of or related, directly or indirectly, to this Escrow Agreement unless caused by the Escrow Agent's gross negligence or willful misconduct.

 

(d)          In the event that the Escrow Agent shall be uncertain as to its duties or rights hereunder, the Escrow Agent shall be entitled to (i) refrain from taking any action other than to keep safely the Escrow Funds until it shall be directed otherwise by a court of competent jurisdiction, or (ii) deliver the Escrow Funds to a court of competent jurisdiction.

 

 

Escrow Agreement-Page 1

  

  

  

 

 

(e)          The Escrow Agent shall have no duty, responsibility or obligation to interpret or enforce the terms of any agreement other than Escrow Agent's obligations hereunder, and the Escrow Agent shall not be required to make a request that any monies be delivered to the Escrow Account, it being agreed that the sole duties and responsibilities of the Escrow Agent shall he to the extent not prohibited by applicable law (i) to accept checks or other instruments for the payment of money and wire transfers delivered to the Escrow Agent for the Escrow Account and deposit said checks and wire transfers into the non-interest bearing Escrow Account, and (ii) to disburse or refrain from disbursing the Escrow Funds as stated above, provided that the checks received by the Escrow Agent have been collected and are available for withdrawal.

 

3.          Resignation and Termination of the Escrow Agent. The Escrow Agent may resign at any time by giving 30 days' prior written notice of such resignation to the Company. Upon providing such notice, the Escrow Agent shall have no further obligation hereunder except to hold as depositary the Escrow Funds that it receives until the end of such 30-day period. In such event, the Escrow Agent shall not take any action, other than receiving and depositing Subscribers checks and wire transfers in accordance with this Agreement, until the Company has designated a banking corporation, trust company, attorney or other person as successor. Upon receipt of such written designation signed by the Company, the Escrow Agent shall promptly deliver the Escrow Funds to such successor and shall thereafter have no further obligations hereunder. If such instructions are not received within 30 days following the effective date of such resignation, then the Escrow Agent may deposit the Escrow Funds held by it pursuant to this Agreement with a clerk of a court of competent jurisdiction pending the appointment of a successor. In either case provided for in this paragraph, the Escrow Agent shall be relieved of all further obligations and released from all liability thereafter arising with respect to the Escrow Funds. If the Escrow Agent should resign within the first twelve (12) months of the date of this Agreement, then all applicable fees, including the initial fee of $5,000.00 will be refunded to the Company.

 

4.          Termination. The Company may terminate the appointment of the Escrow Agent hereunder upon written notice specifying the date upon which such termination shall take effect, which date shall be at least 30 days from the date of such notice. In the event of such termination, the Company shall, within 30 days of such notice, appoint a successor escrow agent and the Escrow Agent shall, upon receipt of written instructions signed by the Company, turn over to such successor escrow agent all of the Escrow Funds; provided, however, that if the Company fails to appoint a successor escrow agent within such 30-day period, such termination notice shall be null and void and the Escrow Agent shall continue to be bound by all of the provisions hereof. Upon receipt of the Escrow Funds, the successor escrow agent shall become the escrow agent hereunder and shall be bound by all of the provisions hereof and the Escrow Agent shall be relieved of all further obligations and released from all liability thereafter arising with respect to the Escrow Funds and under this Agreement.

 

5.          Investment. The Escrow Funds received by the Escrow Agent shall be invested only in non-interest bearing hank accounts at the Escrow Agent.

 

6.          Compensation. Escrow Agent shall be entitled, for the duties to be performed by it hereunder, to a fee of $5,000.00, which fee shall he paid by the Company upon the signing of this Agreement. In addition, the Company shall be obligated to reimburse Escrow Agent for all fees, costs and expenses incurred or that become due in connection with this Agreement or the Escrow Account, including reasonable attorney's fees. Neither the modification, cancellation, termination or rescission of this Agreement nor the resignation or termination of the Escrow Agent shall affect the right of Escrow Agent to retain the amount of any fee which has been paid, or to be reimbursed or paid any amount which has been incurred or becomes due, prior to the effective date of any such modification, cancellation, termination, resignation or rescission. To the extent the Escrow Agent has incurred any such expenses, or any such fee becomes due, prior to any closing, the Escrow Agent shall advise the Company and the Company shall direct all such amounts to be paid directly at any such closing.

 

 

Escrow Agreement-Page 2

  

  

  

 

 

7.          Notices. All notices, requests, demands and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if sent by hand-delivery, by facsimile, followed by first-class mail, by nationally recognized overnight courier service or by prepaid registered or certified mail, return receipt requested, to the addresses set forth below:

If to the Company:

Willamette Valley Vineyards, Inc.

8800 Enchanted Way SE

Turner, OR 97392

With a copy to:

Jim Bernau

2545 Cloverdale Rd SE

Turner, OR 97392

If to Escrow Agent:

 

OTR, Inc.

1001 S.W. Fifth Ave., Suite 1550 

Portland, Oregon 97204-1143 

Attention: Robert E. Roach

Tel: 503-225-0375 

Fax: 503-273-9168

 

8.          General.

 

(a)          This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Oregon applicable to agreements made and to be entirely performed within such State, without regard to choice of law principles and any action brought hereunder shall be brought in the courts of the State of Oregon, located in Multnomah County. Each party hereto irrevocably waives any objection on the grounds of venue, forum nonconveniens or any similar grounds and irrevocably consents to service of process by mail or in any manner permitted by applicable law and consents to the jurisdiction of said courts. Each of the parties hereto hereby waives all right to trial by jury in any action, proceeding or counterclaim arising out of the transactions contemplated by this Agreement.

 

(b)          This Agreement sets forth the entire agreement and understanding of the parties with respect to the matters contained herein and supersedes all prior agreements, arrangements and understandings relating thereto.

 

(c)          All of the terms and conditions of this Agreement shall be binding upon, and inure to the benefit of and be enforceable by, the parties hereto, as well as their respective successors and assigns.

 

 

Escrow Agreement-Page 3

  

  

  

 

(d)          This Agreement may be amended, modified, superseded or canceled, and any of the terms or conditions hereof may be waived, only by a written instrument executed by each party hereto or, in the case of a waiver, by the party waiving compliance. The failure of any party at any time or times to require performance of any provision hereof shall in no manner affect its right at a later time to enforce the same. No waiver of any party of any condition, or of the breach of any term contained in this Agreement, whether by conduct or otherwise, in any one or more instances shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of the breach of any other term of this Agreement. No party may assign any rights, duties or obligations hereunder unless all other parties have given their prior written consent.

 

(e)          If any provision included in this Agreement proves to be invalid or unenforceable, it shall not affect the validity of the remaining provisions.

 

(f)          This Agreement and any modification or amendment of this Agreement may be executed in several counterparts or by separate instruments and all of such counterparts and instruments shall constitute one agreement, binding on all of the parties hereto.

 

9.          Form of Signature. The parties hereto agree to accept a facsimile transmission copy of their respective actual signatures as evidence of their actual signatures to this Agreement and any modification or amendment of this Agreement; provided, however, that each party who produces a facsimile signature agrees, by the express terms hereof, to place, promptly after transmission of his or her signature by fax, a true and correct original copy of his or her signature in overnight mail to the address of the other party.

 

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first set forth above.

 

 

_____________________________________

 

 

	
By: 

	/s/ James W. Bernau	 
	 	Name: James W. Bernau	 
	 	Title: CEO	 
	 	 	 

 

THE ESCROW AGENT 

OTR, Inc.

 

	
By: 

	/s/ Robert E. Roach	 
	 	Name: Robert E. Roach	 
	 	Title: Vice President	 
	 	 	 

 

 

Escrow Agreement-Page 4

  

  

  

 

Schedule I

 

The Escrow Agent is authorized to accept instructions signed or believed by the Escrow Agent to be signed by any one of the following on behalf of the Company.

 

	
Name:

	
Kathy Shannon

	  	
Signature:

	
/s/ Kathy Shannon

	  	  	  	  	  
	
Name:

	
James W. Bernau

	  	
Signature:

	
/s/ James W. Bernau

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Escrow Agreement-Page 5

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