Document:

Unassociated Document

     

    STATE OF
DELAWARE

    SECRETARY
OF STATE

    DIVISION
OF CORPORATIONS

    FILED
09:00 AM 06/07/2002

    020368494
— 0896898

     

    Exhibit
4.1

     

    

    CERTIFICATE
OF DESIGNATIONS OF PREFERENCES AND

    RIGHTS
OF SERIES C CONVERTIBLE PREFERRED STOCK

    OF

    NEW
CENTURY COMPANIES, INC.

     

    Pursuant
to Section 151 of the General Corporation Law

    of the
State of Delaware

     

    The
undersigned, being the duly elected Chief Executive Officer and Secretary of New
Century Companies, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware in accordance with the provisions of
Section 103 thereof (the “Corporation”), DO HEREBY CERTIFY:

     

    That
pursuant to the authority conferred upon the Board of Directors by the
Certificate of Incorporation of the Corporation, as amended, the Board of
Directors has duly adopted the following recitals and resolutions:

     

    “WHEREAS,
the Certificate of Incorporation of this corporation, as amended, provides for a
class of shares known as Preferred Stock, par value $1.00 per share, of the
Corporation (the “Preferred Stock”), issuable from time to time in one or more
series;

     

    WHEREAS,
the Board of Directors of this corporation is authorized to determine or alter
the rights, preferences, privileges and restrictions granted to or imposed upon
any wholly unissued series of Preferred Stock, to fix the number of shares
constituting any such series, and to determine the designation thereof, or any
of them; and

     

    WHEREAS,
the Board of Directors of this corporation desires, pursuant to its authority,
to determine and fix the rights, preferences, privileges and restrictions
relating to this series of Preferred Stock and the number of shares constituting
and the designation of such series;

     

    NOW,
THEREFORE, BE IT RESOLVED, that the Board of Directors hereby fixes and
determines the designation of, the number of shares constituting, and the
rights, preferences, privileges and restrictions relating to, a new series of
Preferred Stock as follows:

     

    
      
         

      

      
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    b.           Designation.  This
series of Preferred Stock shall be designated “Series C Preferred
Stock”.

     

    c.           Number.  The
number of shares constituting the Series C Preferred Stock shall be
75,000.  None of the Series C Preferred Stock have been
issued.

     

    d.           Dividends.  Commencing
on the date of issuance (the “Issuance Date”), each issued and outstanding share
of Series C Preferred Stock shall entitle the holder of record thereof to
receive, when, as and if declared by the Board of Directors, out of any funds
legally available therefor, dividends in preference to the holders of Common
Stock, par value $0.10 per share (the “Common Stock”), of the Corporation, and
any other junior stock, until conversion, at the rate (the “Dividend Rate”) of
$1.25 per annum per share of Series C Preferred Stock, subject to
adjustment in each case as hereinafter set forth, payable semi-annually on each
December 15 and June 15 (the “Dividend Payment Date”), to holders of
record on November 30 and May 31 (“Dividend Record
Date”).  Dividends shall accrue from the Issuance Date and shall
accrue from day to day, whether or not earned or declared.  Dividends
shall be paid on the Series C Preferred Stock only when, as and if declared
by the Board of Directors, out of funds legally available
therefor.  Dividends shall be cumulative so that, if such dividends in
respect of any previous or current semi-annual period, at the annual rate
specified above (subject to adjustment as herein provided), shall not have been
paid or declared and a sum sufficient for payment thereof set apart, the
deficiency shall first be fully paid before any dividend or other distribution
shall be paid on or set apart for any equity securities of the Corporation which
is junior to the Series C Preferred Stock.  Any accumulation of
dividends on the Series C Preferred Stock shall not bear
interest.  Unless full cumulative dividends on the Series C
Preferred Stock for all past dividend periods and the then current dividend
period shall have been paid or declared and a sum sufficient for the payment
thereof set apart: (i) no dividend whatsoever shall be paid or declared,
and no distribution shall be made, on any equity security of the Corporation
which is junior to the Series C Preferred Stock, and (ii) no shares of
any equity security which are junior to the Series C Preferred Stock of the
Corporation shall be purchased, redeemed, or acquired by the Corporation and no
funds shall be paid into or set aside or made available for a sinking fund for
the purchase, redemption, or acquisition thereof.  If any dividend
previously due on the Series C Preferred Stock has not been paid in full,
then no dividends shall be paid or declared upon any shares of any class or
series of stock of the Corporation ranking on a parity with the Series C
Preferred Stock in the payment of dividends for any period unless a like
proportionate dividend for the current period, ratably in proportion to the
respective annual dividend rates fixed thereupon, shall be paid upon or declared
for the Series C Preferred Stock then issued and outstanding.  In
the event of a split or subdivision of the outstanding shares of Series C
Preferred Stock, or the combination or the outstanding shares of Series C
Preferred Stock, as the case may be, the dividends provided for herein shall
automatically and without any further action be decreased, in the case of a
split or subdivision, or increased, in the case of a combination, in proportion
to the increase or decrease in the number of shares of Series C Preferred
Stock outstanding immediately before such split, subdivision or
combination.

     

    e.           Liquidation
Preference.

     

    (i)           In
the event of any liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, the holders of the Series C Preferred
Stock shall each be entitled to receive, prior and in preference to any
distribution of any of the assets or surplus funds of the Corporation to the
holders of the Common Stock or any class or series of shares except any class or
series of shares which is entitled to priority over the Series C Preferred
Stock, by reason of their ownership thereof, a liquidation preference (the
“Liquidation Preference”) in the amount of $25.00 per share (as adjusted for any
stock dividends, combinations or splits with respect to such
shares).  If upon the occurrence of such event, the remaining assets
and funds thus distributed (after taking into account any payment to any class
or series of shares having priority over or parity with the Series C
Preferred Stock) among the holders of the Series C Preferred Stock shall be
insufficient to permit the payment to such holders of the full Liquidation
Preference, then the entire assets and funds of the Corporation legally
available for distribution shall be distributed ratably among the holders of the
Series C Preferred Stock in proportion to the shares of Series C
Preferred Stock then held by them.

     

    
      
         

      

      
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    (ii)           For
purposes of this Section (d), (A) any acquisition of the Corporation
by means of merger or other form of corporate reorganization in which
outstanding shares of the Corporation are exchanged for securities or other
consideration issued, or caused to be issued, by the acquiring corporation or
its subsidiary (other than a mere reincorporation transaction) or (B) a
sale of all or substantially all of the assets of the Corporation, shall be
treated as a liquidation, dissolution or winding up of the Corporation and shall
entitle the holders of Series C Preferred Stock and Common Stock to receive
at the closing in cash, securities or other property (valued as provided in
Section (d)(iii) below) amounts as specified in Section (d)(i)
above.

     

    (iii)           Whenever
the distribution provided for in this Section (d) shall be payable in
securities or property other than cash, the value of such distribution shall be
the fair market value of such securities or other property as determined in good
faith by the Board of Directors.

     

    f.           Voting
Rights.

     

    Except as
otherwise expressly provided by law or this Certificate of Designation, the
holders of the Series C Preferred shall have no voting
rights.  Notwithstanding the foregoing, so long as any shares of the
Series C Preferred Stock remain outstanding, the consent of two-thirds of
the holders of the then outstanding Series C Preferred Stock, voting as one
class, either expressed in writing or at a meeting called for that purpose,
shall be necessary to repeal, amend or otherwise change this Certificate of
Designation, or the Certificate of Incorporation of the Company, as amended, in
a manner which would alter or change the powers, preferences, rights,
privileges, restrictions and conditions of the Series C Preferred Stock so
as to adversely affect the Series C Preferred Stock.  Each share
of the Series C Preferred Stock shall entitle the holder thereof to one
vote on all matters to be voted on by the holders of the Series C Preferred
Stock, as set forth above.

     

    g.           Conversion.  The
holders of the Series C Preferred Stock shall have conversion rights as
follows (the “Conversion Rights”):

     

    (i)           Right to
Convert.  Each share of Series C Preferred Stock shall be
convertible, at the option of the holder thereof, at any time, at the office of
the Corporation or any transfer agent for such stock, into 16.667 fully paid and
nonassessable shares of Common Stock on and subject to the terms and conditions
hereinafter set forth.  The conversion rate in effect at any time
herein is hereinafter referred to as the “Conversion Rate”.

     

    
      
         

      

      
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    (ii)           Automatic
Conversion.  Each share of Series C Preferred Stock then
outstanding shall, by virtue of such conditions and without any action on the
part of the holder thereof, be deemed automatically converted into that number
of Common Stock into which the Series C Preferred Stock would then be
converted at the then effective Conversion Rate as of the date that a
registration statement covering the shares of Common Stock issuable upon
conversion of the Series C Preferred Stock has been declared effective by
the Securities and Exchange Commission.

     

    (iii)           Mechanics of
Conversion.  Before any holder of Series C Preferred Stock
shall be entitled to receive certificates for shares of Common Stock, he shall
surrender the certificate or certificates therefor, duly endorsed, at the office
of the Corporation or of any transfer agent for such stock, and shall give
written notice to the Corporation at such office that he elects to convert the
same and shall state therein the name or names in which he wishes the
certificate or certificates for shares of Common Stock to be
issued.  The Corporation shall, as soon as practicable thereafter,
issue and deliver at such office to such holder of Series C Preferred
Stock, a certificate or certificates for the number of shares of Common Stock to
which he shall be entitled as aforesaid.  Such conversion shall be
deemed to have been made immediately prior to the close of business on the date
of surrender of the shares of Series C Preferred Stock to be converted, and
the person or persons entitled to receive the shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder or
holders of such shares of Common Stock on such date.  Upon receipt of
evidence reasonably satisfactory to the Corporation of the loss, theft,
destruction or mutilation of certificate or certificates representing the
Series C Preferred Stock from any holder therefor, and (if lost, stolen or
destroyed) of indemnity reasonably satisfactory to the Corporation, and (if
mutilated) upon surrender and cancellation of the certificate or certificates,
each such holder shall be entitled to convert the Series C Preferred Stock
held by such holder into Common Stock in the manner as aforesaid.

     

    (iv)           Adjustments to Conversion
Rate for Combinations or Subdivisions of Common Stock.  In the
event that this Corporation at any time or from time to time after the original
issue date of the Series C Preferred Stock shall effect a subdivision of
the outstanding shares of Common Stock into a greater number of shares of Common
Stock (by stock split, reclassification or otherwise than by payment of a
dividend in Common Stock or in any right to acquire Common Stock), or in the
event the outstanding shares of Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Common
Stock, then the Conversion Rate in effect immediately prior to such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate.

     

    (v)           Adjustment for
Reclassification and Reorganization.  If the Common Stock
issuable upon conversion of the Series C Preferred Stock shall be changed
into the same or a different number of shares of any other class or classes of
stock, whether by capital reorganization, reclassification or otherwise (other
than a subdivision or combination of shares provided for in Section (f)(iv)
above or a merger or other reorganization referred to in Section (d)(ii)
above), the Conversion Rate then in effect shall, concurrently with the
effectiveness of such reorganization or reclassification, be proportionately
adjusted so that the Series C Preferred Stock shall be convertible into, in
lieu of the number of shares of Common Stock which the holders would otherwise
have been entitled to receive, a number of shares of such other class or classes
of stock equivalent to the number of shares of Common Stock that would have been
subject to receipt by the holders upon conversion of the Series C Preferred
Stock immediately before that change.

     

    
      
         

      

      
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    (vi)           No
Impairment.  The Corporation will not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Corporation, but will at
all times in good faith assist in the carrying out of the provisions of this
Section (f) and in the taking of all such action as may be necessary or
appropriate in order to protect the Conversion Rights of the holders of the
Series C Preferred Stock against impairment.

     

    (vii)           Certificates as to
Adjustments.  Upon the occurrence of each adjustment or
readjustment of any Conversion Rate pursuant to this Section (f), the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of Series C Preferred Stock a certificate executed by the
Corporation’s President or Chief Financial Officer setting forth such adjustment
or readjustment and showing in detail the facts upon which such adjustment or
readjustment is based.  The Corporation shall, upon the written
request at any time of any holder of Series C Preferred Stock, furnish or
cause to be furnished to such holder a like certificate setting forth
(A) such adjustments and readjustments, (B) the Conversion Rate for
the Series C Preferred Stock at the time in effect, and (C) the number
of shares of Common Stock and the amount, if any, of other property which at the
time would be received upon the conversion of the Series C Preferred
Stock.

     

    (viii)                      Notices of Record
Date.  In the event that the Corporation shall propose at any
time (A) to effect any reclassification or recapitalization of its Common
Stock outstanding involving a change in the Common Stock, or (B) to merge
or consolidate with or into any other corporation, or sell, lease or convey all
or substantially all of its assets, or to liquidate, dissolve or wind up; then,
in connection with each such event, the Corporation shall send to the holders of
Series C Preferred Stock:

     

    (x)           at
least twenty (20) days’ prior written notice of the date on which a record shall
be taken for determining rights to vote, if any, in respect of the matters
referred to in (A) and (B) above;

     

    (y)           in
the case of the matters referred to in (A) and (B) above, at least
twenty (20) days’ prior written notice of the date when the same shall take
place (and specifying the date on which the holders of Common Stock shall be
entitled to exchange their Common Stock for securities or other property
deliverable upon the occurrence of such event).

     

    
      
         

      

      
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    (ix)           Issue
Taxes.  The Corporation shall pay any and all issue and other
taxes that may be payable in respect of any issue or delivery of shares of
Common Stock on conversion of Series C Preferred Stock pursuant hereto;
provided, however, that the Corporation shall not be obligated to pay any
transfer taxes resulting from any transfer requested by any holder in connection
with any such conversion.

     

    (x)           Reservation of Stock
Issuable Upon Conversion.  The Corporation shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the conversion of the shares of the
Series C Preferred Stock, such number of its shares of Common Stock as
shall from time to time be sufficient to effect the conversion of all
outstanding shares of the Series C Preferred Stock; and if at any time the
number of authorized but unissued shares of Common Stock shall not be sufficient
to effect the conversion of all then outstanding shares of the Series C
Preferred Stock, the Corporation will take such corporate action as may, in the
opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose, including, without limitation, engaging in best efforts to obtain the
requisite stockholder approval of any necessary amendment to this Certificate of
Designation.

     

    (xi)           Fractional
Shares.  No fractional share shall be issued upon the
conversion of any share or shares of Series C Preferred
Stock.  All shares of Common Stock (including fractions thereof)
issuable upon conversion of more than one share of Series C Preferred Stock
by a holder thereof shall be aggregated for purposes of determining whether the
conversion would result in the issuance of any fractional share.  If,
after the aforementioned aggregation, the conversion would result in the
issuance of a fraction of a share of Common Stock, the Corporation shall, in
lieu of issuing any fractional share, pay the holder otherwise entitled to such
fraction a sum in cash equal to the fair market value of such fraction on the
date of conversion (as determined in good faith by the Board of
Directors).

     

    (xii)           Notices.  Any
notice required by the provisions of this Section (f) to be given to the
holders of shares of Series C Preferred Stock shall be deemed given if
deposited in the United States mail, postage prepaid, and addressed to each
holder of record at such holder’s address appearing in the records of the
Corporation.

     

    h.           Rank.

     

    The
Series C Preferred Stock shall rank, with respect to the payment of
dividends and the distribution of assets, prior and superior to all series of
the Corporation’s Preferred Stock and any other class of the Corporation’s
securities, including the Common Stock.

     

    RESOLVED
FURTHER, that the Chief Executive Officer or any Vice President, and the
Secretary or the Chief Financial Officer of this corporation be, and each of
them hereby is, authorized, empowered and directed, for and on behalf of this
corporation, to execute, verify and file a certificate of determination of
preferences with respect to the Series C Preferred Stock in accordance with
Delaware law; and

     

    
      
         

      

      
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    RESOLVED
FURTHER, that any officer of this corporation, acting alone, be, and hereby is,
authorized, empowered and directed, for and on behalf of this corporation, to
execute any and all further documents or instruments and to take any further
actions as may be necessary, proper or advisable in order to effectuate the
intent and purposes of the foregoing resolutions.”

     

    The
undersigned further declare under penalty of perjury under the laws of the State
of Delaware that the matters set forth in this Certificate of Designation of
Preferences and Rights are true and correct of our own knowledge.

     

    

    
      	
              DATED:  
      June 7, 2002

            	
               

               

               

               /s/ David
      Duquette                                                             

              David
      Duquette, President and

              Chief
      Executive Office

               

            
	 
      	
               /s/ Josef
      Czikmantori                                                             

              Josef
      Czikmantori, Secretary

            

    

     

     

     

     

    11Unassociated Document

    STATE OF
DELAWARE

    SECRETARY
OF STATE

    DIVISION
OF CORPORATIONS

    Delivered
01:48 PM 05/25/2004

    FILED
01:48 PM 05/25/2004

    SRV
040386327 – 0896898

    

    Exhibit
4.2

    

    CERTIFICATE
OF DESIGNATIONS OF PREFERENCES AND

    RIGHTS
OF SERIES D CONVERTIBLE PREFERRED STOCK

    OF

    NEW
CENTURY COMPANIES, INC.

     

    Pursuant
to Section 151 of the General Corporation Law

    of the
State of Delaware

     

    The
undersigned, being the duly elected Chief Executive Officer and Secretary of New
Century Companies, Inc., a corporation organized and existing under the General
Corporation Law of the State of Delaware in accordance with the provisions of
Section 103 thereof (the “Corporation”), DO HEREBY CERTIFY:

     

    That
pursuant to the authority conferred upon the Board of Directors by the
Certificate of Incorporation of the Corporation, as amended, the Board of
Directors has duly adopted the following recitals and resolutions:

     

    “WHEREAS,
the Certificate of Incorporation of this corporation, as amended, provides for a
class of shares known as Preferred Stock, par value $1.00 per share, of the
Corporation (the ‘Preferred Stock”), issuable from time to time in one or more
series;

     

    WHEREAS,
the Board of Directors of this corporation is authorized to determine or alter
the rights, preferences, privileges and restrictions granted to or imposed upon
any wholly unissued series of Preferred Stock, to fix the number of shares
constituting any such series, and to determine the designation thereof, or any
of them; and

     

    WHEREAS,
the Board of Directors of this corporation desires, pursuant to its authority,
to determine and fix the rights, preferences, privileges and restrictions
relating to this series of Preferred Stock and the number of shares constituting
and the designation of such series;

     

    NOW,
THEREFORE, BE IT RESOLVED, that the Board of Directors hereby fixes and
determines the designation of, the number of shares constituting, and the
rights, preferences, privileges and restrictions relating to, a new series of
Preferred Stock as follows:

     

    
      
         

      

      
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    i.           Designation.  This
series of Preferred Stock shall be designated “Series D Preferred
Stock”.

     

    j.           Number.  The
number of shares constituting the Series D Preferred Stock shall be
75,000.  None of the Series D Preferred Stock have been
issued.

     

    k.           Dividends.  Commencing
on the date of issuance (the “Issuance Date”), each issued and outstanding share
of Series D Preferred Stock shall entitle the holder of record thereof to
receive, out of any funds legally available therefore, dividends in preference
to the holders of Common Stock, par value $0.10 per share (the “Common Stock”),
of the Corporation, and any other junior stock, until conversion, at the rate
(the “Dividend Rate”) of $1.25 per annum per share of Series D Preferred Stock,
subject to adjustment in each case as hereinafter Set forth, payable
semi-annually on each July 15 and January 15 (the “Dividend Payment Date”), to
holders of record on June 30 and December 31 (“Dividend Record Date”). Dividends
shall accrue from the Issuance Date and shall accrue from day to day. Dividends
shall be paid on the Series D Preferred Stock, whether or not declared by the
Board of Directors, out of funds legally available therefore. Dividends shall be
cumulative so that, if such dividends in respect of any previous or current
semi-annual period, at the annual rate specified above (subject to adjustment as
herein provided), shall not have been paid and a sum sufficient for payment
thereof set apart, the deficiency shall first be fully paid before any dividend
or other distribution shall he paid on or set apart for any equity securities of
the Corporation which is junior to the Series D Preferred Stock.  Any
accumulation of dividends on the Series D Preferred Stock shall not bear
interest.  Unless full cumulative dividends on the Series D Preferred
Stock for all past dividend periods and the then current dividend period shall
have been paid or declared and a sum sufficient for the payment thereof set
apart: (i) no dividend whatsoever shall be paid or declared, and no distribution
shall be made, on any equity security of the Corporation which is junior to the
Series D Preferred Stock, and (ii) no shares of any equity security which are
junior to the Series D Preferred Stock of the Corporation shall be purchased,
redeemed, or acquired by the Corporation and no funds shall be paid into or set
aside or made available for a sinking fund for the purchase, redemption, or
acquisition thereof.  If any dividend previously due on the Series D
Preferred Stock has not been paid in full, then no dividends shall be paid or
declared upon any shares of any class or series of stock of the Corporation
ranking on a parity with the Series D Preferred Stock in the payment of
dividends for any period unless a like proportionate dividend for the current
period, ratably in proportion to the respective annual dividend rates fixed
thereupon, shall be paid upon or declared for the Series D Preferred Stock then
issued and outstanding. in the event of a split or subdivision of the
outstanding shares of Series D Preferred Stock, or the combination or the
outstanding shares of Series D Preferred Stock, as the case may be, the
dividends provided for herein shall automatically and without any further action
be decreased, in the case of a split or subdivision, or increased, in the case
of a combination, in proportion to the increase or decrease in the number of
shares of Series D Preferred Stock outstanding immediately before such split,
subdivision or combination.

     

    l.           Liquidation
Preference.

     

    (i)           In
the event of any liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, the holders of the Series D Preferred Stock
shall each be entitled to receive, prior and in preference to any distribution
of any of the assets or surplus funds of the Corporation to the holders of the
Common Stock or any class or series of shares except any class or series of
shares which is entitled to priority over the Series D Preferred Stock, by
reason of their ownership thereof, a liquidation preference (the “Liquidation
Preference”) in the amount of $25.00 per share (as adjusted for any stock
dividends, combinations or splits with respect to such shares).  If
upon the occurrence of such event, the remaining assets and funds thus
distributed (after taking into account any payment to any class or series of
shares having priority over or parity with the Series D Preferred Stock) among
the holders of the Series D Preferred Stock shall be insufficient to permit the
payment to such holders of the full Liquidation Preference, then the entire
assets and funds of the Corporation legally available for distribution shall be
distributed ratably among the holders of the Series D Preferred Stock in
proportion to the shares of Series D Preferred Stock then held by
them.

     

    
      
         

      

      
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    (ii)           For
purposes of this Section (d), (A) any acquisition of the Corporation by means of
merger or other form of corporate reorganization in which outstanding shares of
the Corporation are exchanged for securities or other consideration issued, or
caused to be issued, by the acquiring corporation or its subsidiary (other than
a mere reincorporation transaction) or (B) a sale of alt or substantially
all of the assets of the Corporation, shall be treated as a liquidation,
dissolution or winding up of the Corporation and shall entitle the holders of
Series D Preferred Stock and Common Stock to receive at the closing in cash,
securities or other property (valued as provided in Section (d)(iii) below)
amounts as specified in Section (d)(i) above.

     

    (iii)           Whenever
the distribution provided for in this Section (d) shall be payable in securities
or property other than cash, the value of such distribution shall be the fair
market value of such securities or other property as determined in good faith by
the Board of Directors.

     

    m.           Voting
Rights.

     

    Except as
otherwise expressly provided by law or this Certificate of Designation, the
holders of the Series D Preferred shall have no voting
rights.  Notwithstanding the foregoing, so long as any shares of the
Series D Preferred Stock remain outstanding, the consent of two-thirds of the
holders of the then outstanding Series D Preferred Stock, voting as one class,
either expressed in writing or at a meeting called for that purpose, shall be
necessary to repeal, amend or otherwise change this Certificate of Designation,
or the Certificate of Incorporation of the Company, as amended, in a manner
which would alter or change the powers, preferences, rights, privileges,
restrictions and conditions of the Series D Preferred Stock so as to adversely
affect the Series D Preferred Stock.  Each share of the Series D
Preferred Stock shall entitle the holder thereof to one vote on all matters to
be voted on by the holders of the Series D Preferred Stock, as set forth
above.

     

    n.           Conversion.  The
holders of the Series D Preferred Stock shall have conversion rights as follows
(the “Conversion Rights”):

     

    (i)           Right to
Convert.  Each share of Series D Preferred Stock shall be
convertible, at the option of the holder thereof, at any time, at the office of
the Corporation or any transfer agent for such stock, into 50 fully paid and
nonassessable shares of Common Stock on and subject to the terms and conditions
hereinafter set forth.  The conversion rate in effect at any time
herein is hereinafter referred to as the “Conversion Rate”.

     

    
      
         

      

      
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    (ii)           Automatic
Conversion.  Each share of Series D Preferred Stock then
outstanding shall, by virtue of such conditions and without any action on the
part of the holder thereof, be deemed automatically converted into that number
of Common Stock into which the Series I) Preferred Stock would then be converted
at the then effective Conversion Rate as of the date that a registration
statement covering the shares of Common Stock issuable upon conversion of the
Series D Preferred Stock has been declared effective by the Securities and
Exchange Commission.

     

    (iii)           Mechanics of
Conversion.  Before any holder of Series D Preferred Stock
shall be entitled to receive certificates for shares of Common Stock, he shall
surrender the certificate or certificates therefore, duly endorsed, at the
office of the Corporation or of any transfer agent for such stock, and shall
give written notice to the Corporation at such office that he elects to convert
the same and shall state therein the name or names in which he wishes the
certificate or certificates for shares of Common Stock to be
issued.  The Corporation shall, as soon as practicable thereafter,
issue and deliver at such office to such holder of Series D Preferred Stock, a
certificate or certificates for the number of shares of Common Stock to which he
shall be entitled as aforesaid.  Such conversion shall be deemed to
have been made immediately prior to the close of business on the date of
surrender of the shares of Series I) Preferred Stock to be converted, and the
person or persons entitled to receive the shares of Common Stock issuable upon
such conversion shall be treated for all purposes as the record holder or
holders of such shares of Common Stock on such date.  Upon receipt of
evidence reasonably satisfactory to the Corporation of the loss, theft,
destruction or mutilation of certificate or certificates representing the Series
D Preferred Stock from any holder therefore, and (if lost, stolen or destroyed)
of indemnity reasonably satisfactory to the Corporation, and (if mutilated) upon
surrender and cancellation of the certificate or certificates, each such holder
shall be entitled to convert the Series D Preferred Stock held by such holder
into Common Stock in the manner as aforesaid.

     

    (iv)           Adjustments to Conversion
Rate for Combinations or Subdivisions of Common Stock.  In the
event that this Corporation at any time or from time to time after the original
issue date of the Series D Preferred Stock shall effect a subdivision of the
outstanding shares of Common Stock into a greater number of shares of Common
Stock (by stock split, reclassification or otherwise than by payment of a
dividend in Common Stock or in any right to acquire Common Stock), or in the
event the outstanding shares of Common Stock shall be combined or consolidated,
by reclassification or otherwise, into a lesser number of shares of Common
Stock, then the Conversion Rate in effect immediately prior to such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate.

     

    (v)           Adjustment for
Reclassification and Reorganization.  If the Common Stock
issuable upon conversion of the Series D Preferred Stock shall be changed into
the same or a different number of shares of any other class or classes of stock,
whether by capital reorganization, reclassification or otherwise (other than a
subdivision or combination of shares provided for in Section (f)(iv) above or a
merger or other reorganization referred to in Section (d)(ii) above), the
Conversion Rate then in effect shall, concurrently with the effectiveness of
such reorganization or reclassification, be proportionately adjusted so that the
Series D Preferred Stock shall be convertible into, in lieu of the number of
shares of Common Stock which the holders would otherwise have been entitled to
receive, a number of shares of such other class or classes of stock equivalent
to the number of shares of Common Stock that would have been subject to receipt
by the holders upon conversion of the Series D Preferred Stock immediately
before that change.

     

    
      
         

      

      
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    (vi)           Adjustments
to Conversion Rate for Diluting Issues:

     

    (a)           Special
Definitions.  For purposes of this subsection (vi), the
following definitions shall apply:

     

    (A)           “Option” shall mean
any right, option, or warrant to subscribe for, purchase or otherwise acquire
Common Stock or Convertible Securities, excluding (1) options described in
clause (vi)(i)(D)(IV) below and (2) any warrant issued in connection with the
establishment of credit facilities for the Corporation.

     

    (B)           “Original Issue Date”
shall mean the date on which a share of Series D Preferred Stock was first
issued.

     

    (C)           “Convertible
Securities” shall mean any evidences of indebtedness, shares or other
securities directly or indirectly convertible into or exchangeable for Common
Stock.

     

    (D)           “Additional Shares of Common
Stock” shall mean all shares of Common Stock issued (or, pursuant to
clause (vi)(c) below, deemed to be issued) by the Corporation after the Original
Issue Date, other than shares of Common Stock issued or issuable:

     

    (I)           upon
conversion of any Convertible Securities outstanding on the Original Issue Date,
or upon exercise of any Options outstanding on the Original Issue
Date;

     

    (II)           as
a dividend or distribution on shares of Series D Preferred Stock;

     

    (III)           by
reason of a dividend, stock split, split-up or other distribution on shares of
Common Stock that is covered by subsections (iv) or(v) above;

     

    (IV)           upon
exercise of options to acquire Common Stock granted pursuant to the Company’s
Employee Stock Option Plan (subject to appropriate adjustment in the event of
any stock dividend, stock split, combination or other similar recapitalization
affecting shares of Common Stock) or granted in connection with the
establishment of credit facilities for the Corporation; and

     

    (V)           to
holders of Series D Preferred Stock upon conversion of such Preferred Stock
pursuant to the terms hereof.

     

    (b)           No Adjustment of Conversion
Rate.  No adjustment in the number of shares of Common Stock
into which the shares of Series D Preferred Stock is convertible shall be made
with respect to such series, by adjustment in the applicable Conversion Rate
thereof, by reason of issuance or deemed issuance of Additional Shares: (a)
unless the consideration per share (determined pursuant to clause (vi)(e)) for
an Additional Share of Common Stock issued or deemed to be issued by the
Corporation is less than the applicable Conversion Rate in effect on the date
of, and immediately prior to, the issuance of such Additional
Shares.

     

    
      
         

      

      
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    (c)           Issue of Securities Deemed
Issue of Additional Shares of Common Stock.  If the Corporation
at any time or from time to time after the Original Issue Date shall issue any
Options or Convertible Securities or shall fix a record date for the
determination of holders of any class of securities entitled to receive any such
Options or Convertible Securities, then the maximum number of shares of Common
Stock (as set forth in the instrument relating thereto without regard to any
provision contained therein for a subsequent adjustment of such number) issuable
upon the exercise of such Options or, in the case of Convertible Securities
and/or Options therefore, the conversion or exchange of such Convertible
Securities, shall be deemed to be Additional Shares of Common Stock issued as of
the time of such issue or, in case such a record date shall have been fixed, as
of the close of business on such record date, provided that Additional Shares of
Common Stock shall not be deemed to have been issued unless the consideration
per share (determined pursuant to clause (vi)(e)) of such Additional Shares of
Common Stock would be less than the applicable Conversion Rate with respect to
the Series D Preferred Stock in effect on the date of and immediately prior to
such issue, or such record date, as the case may be, and provided further that
in any such case in which Additional Shares of Common Stock are deemed to be
issued, then with respect to the Conversion Rate applicable to the Series D
Preferred Stock:

     

    (A)           No
further adjustment in such Conversion Rate shall be made upon the subsequent
issue of Convertible Securities or shares of Common Stock upon the exercise of
such Options or conversion or exchange of such Convertible
Securities;

     

    (B)           If
such Options or Convertible Securities by their terms provide, with the passage
of time or otherwise, for any increase in the consideration payable to the
Corporation, upon the exercise, conversion or exchange thereof, the Conversion
Rate computed upon the original issue thereof (or upon the occurrence of a
record date with respect thereto), and any subsequent adjustments based thereon,
shall, upon any such increase becoming effective, be recomputed to reflect such
increase insofar as it affects such Options or the rights of conversion or
exchange under such Convertible Securities;

     

    (C)           Upon
the expiration or termination of any unexercised Option, such Conversion Rate
shall be readjusted to such amount as would have obtained had the adjustment
made upon the granting or issuance of such Option been made based upon the
issuance of only the number of shares of Common Stock actually issued on
exercise of such Option;

     

    (D)           In
the event of any change in the number of shares of Common Stock issuable upon
the exercise, conversion, or exchange of any Option or Convertible Security,
including, but not limited to, a change resulting from the anti-dilution
provisions thereof, such Conversion Rate then in effect shall forthwith be
readjusted to such Conversion Rate as would have obtained had the adjustment
that was made upon the issuance of such Option or Convertible Security not
exercised or converted prior to such change been made upon the basis of such
change; and

     

    
      
         

      

      
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    (E)           No
readjustment pursuant to clause (B) or (D) above shall have the effect of
increasing such Conversion Rate to an amount that exceeds the lower of (I) such
Conversion Rate on the original adjustment date or (ii) the Conversion Rate that
would have resulted from any issuances of Additional Shares of Common Stock
between the original adjustment date and such readjustment date.

     

    In the
event the Corporation, after the Original Issue Date, amends the terms of any
Options or Convertible Securities (whether such Options or Convertible,
Securities were outstanding on the Original Issue Date or were issued after the
Original Issue Date), then such Options or Convertible Securities, as so
amended, shall be deemed to have been issued after the Original issue Date and
the provisions of this clause (vi)(c) shall apply.

     

    (d)           Adjustment of Conversion
Rate Upon Issuance of Additional Shares of Common Stock.  In
the event the Corporation shall at any time after the Original Issue Date issue
Additional Shares of Common Stock (including Additional Shares of Common Stock
deemed to be issued pursuant to clause (vi)(c) above, but excluding shares
issued as a stock split or combination as provided in clause (iv) above or as
provided in clause (v) above), without consideration or for a consideration per
share less than the Conversion Rate applicable to Series D Preferred Stock in
effect on the date of and immediately prior to such issue, then and in such
event, such Conversion Rate shall be reduced, concurrently with such issue, to a
price (calculated to the nearest cent) determined by multiplying such Conversion
Rate by a fraction, (A) the numerator of which shall be (1) the number of shares
of Common Stock outstanding immediately prior to such issue plus (2) the number
of shares of Common Stock that the aggregate consideration received or to be
received by the Corporation for the total number of Additional Shares of Common
Stock so issued would purchase at such Conversion Rate; and (B) the denominator
of which shall be the number of shares of Common Stock outstanding immediately
prior to such issue plus the number of such Additional Shares of Common Stock so
issued; provided that, (i) for the purpose of this clause (vi)(d), all shares of
Common Stock issuable upon exercise or conversion of Options or Convertible
Securities outstanding immediately prior to such issue shall be deemed to be
outstanding, and (ii) the number of shares of Common Stock deemed issuable upon
exercise or conversion of such outstanding Options and Convertible Securities
shall not give effect to any adjustments to the Conversion Rate or conversion
rate of such Options or Convertible Securities resulting from the issuance of
Additional Shares of Common Stock that is the subject of this
calculation.

     

    (e)           Determination of
Consideration.  For purposes of this clause (vi), the
consideration received by the Corporation for the issue of any Additional Shares
of Common Stock shall be computed as follows:

     

    (A)           Cash and
Property:  Such consideration shall:

     

    (I)           insofar
as it consists of cash, be computed at the aggregate of cash received by the
Corporation, excluding amounts paid or payable for accrued
interest;

     

    
      
         

      

      
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    (II)           insofar
as it consists of property other than cash, be computed at the fair market value
thereof at the time of such issue, as determined in good faith by the Board of
Directors; and

     

    (III)           in
the event Additional Shares of Common Stock are issued together with other
shares or securities or other assets of the Corporation for consideration that
covers both, be the proportion of such consideration so received, computed as
provided in clauses (I) and (II) above, as determined in good faith by the Board
of Directors.

     

    (B)           Options and Convertible
Securities: The consideration per share received by the Corporation for
Additional Shares of Common Stock deemed to have been issued pursuant to clause
(vi)(c) above, relating to Options and Convertible Securities, shall be
determined by dividing

     

    (x)           the
total amount, if any, received or receivable by the Corporation as consideration
for the issue of such Options or Convertible Securities, “the minimum aggregate
amount of additional consideration (as set forth in the instruments relating
thereto, without regard to any provision contained therein for a subsequent
adjustment of such consideration) payable to the Corporation upon the exercise
of such Options or the conversion or exchange of such Convertible Securities, or
in the case of Options for Convertible Securities, the exercise of such Options
for Convertible Securities and the conversion or exchange of such Convertible
Securities, by

     

    (y)           the
maximum number of shares of Common Stock (as set forth in the instruments
relating thereto, without regard to any provision contained therein for a
subsequent adjustment of such number) issuable upon the exercise of such Options
or the conversion or exchange of such Convertible Securities.

     

    (vii)           No
Impairment.  The Corporation will not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed hereunder by the Corporation, but will at
all times in good faith assist in the carrying out of the provisions of this
Section (f) and in the taking of all such action as may be necessary or
appropriate in order to protect the Conversion Rights of the holders of the
Series D Preferred Stock against impairment.

     

    (viii)                      Certificates as to
Adjustments.  Upon the occurrence of each adjustment or
readjustment of any Conversion Rate pursuant to this Section (f), the
Corporation at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and prepare and furnish to each
holder of Series D Preferred Stock a certificate executed by the Corporation’s
President or Chief Financial Officer setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based.  The Corporation shall, upon the written
request at any time of any holder of Series D Preferred Stock, furnish or cause
to be furnished to such holder a like certificate setting forth (A) such
adjustments and readjustments, (B) the Conversion Rate for the Series D
Preferred Stock at the time in effect, and (C) the number of shares of Common
Stock and the amount, if any, of other property which at the time would be
received upon the conversion of the Series D Preferred Stock,

     

    
      
         

      

      
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    (ix)           Notices of Record
Date.  In the event that the Corporation shall propose at any
time (A) to effect any reclassification or recapitalization of its Common Stock
outstanding involving a change in the Common Stock, or (B) to merge or
consolidate with or into any other corporation, or sell, lease or convey all or
substantially all of its assets, or to liquidate, dissolve or wind up; then, in
connection with each such event, the Corporation shall send to the holders of
Series D Preferred Stock:

     

    (x)           at
least twenty (20) days’ prior written notice of the date on which a record shall
be taken for determining rights to vote, if any, in respect of the matters
referred to in (A) and (B) above;

     

    (y)           in
the case of the matters referred to in (A) and (B) above, at least twenty (20)
days’ prior written notice of the date when the same shall take place (and
specifying the date on which the holders of Common Stock shall be entitled to
exchange their Common Stock for securities or other property deliverable upon
the occurrence of such event).

     

    (x)           Issue
Taxes.  The Corporation shall pay any and all issue and other
taxes that may be payable in respect of any issue or delivery of shares of
Common Stock on conversion of Series D Preferred Stock pursuant hereto;
provided, however, that the Corporation shall not be obligated to pay any
transfer taxes resulting from any transfer requested by any holder in connection
with any such conversion.

     

    (xi)           Reservation of Stock
Issuable Upon Conversion.  The Corporation shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the conversion of the shares of the
Series D Preferred Stock, such number of its shares of Common Stock as shall
from time to time be sufficient to effect the conversion of all outstanding
shares of the Series D Preferred Stock; and if at any time the number of
authorized but unissued shares of Common Stock shall not be sufficient to effect
the conversion of all then outstanding shares of the Series D Preferred Stock,
the Corporation will take such corporate action as may, in the opinion of its
counsel, be necessary to increase its authorized but unissued shares of Common
Stock to such number of shares as shall be sufficient for such purpose,
including, without limitation, engaging in best efforts to obtain the requisite
stockholder approval of any necessary amendment to this Certificate of
Designation.

     

    (xii)           Fractional
Shares.  No fractional share shall he issued upon the
conversion of any share or shares of Series D Preferred Stock. All shares of
Common Stock (including fractions thereof) issuable upon conversion of more than
one share of Series D Preferred Stock by a holder thereof shall be aggregated
for purposes of determining whether the conversion would result in the issuance
of any fractional share. If, after the aforementioned aggregation, the
conversion would result in the issuance of a fraction of a share of Common
Stock, the Corporation shall, in lieu of issuing any fractional share, pay the
holder otherwise entitled to such fraction a sum in cash equal to the fair
market value of such fraction on the date of conversion (as determined in good
faith by the Board of Directors).

     

    
      
         

      

      
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    (xiii)                      Notices.  Any
notice required by the provisions of this Section (f) to be given to the holders
of shares of Series D Preferred Stock shall be deemed given if deposited in the
United States mail, postage prepaid, and addressed to each holder of record at
such holder’s address appearing in the records of the Corporation.

     

    o.           Rank.

     

    The
Series D Preferred Stock shall rank, with respect to the payment of dividends
and the distribution of assets, on a party with all outstanding series of the
Corporation’s Preferred Stock and prior and superior to any other class of the
Corporation’s securities, including the Common Stock,

     

    RESOLVED
FURTHER, that the Chief Executive Officer or any Vice President, and the
Secretary or the Chief Financial Officer of this corporation be, and each of
them hereby is, authorized, empowered and directed, for and on behalf of this
corporation, to execute, verify and file a certificate of determination of
preferences with respect to the Series D Preferred Stock in accordance with
Delaware law; and

     

    RESOLVED
FURTHER, that any officer of this corporation, acting alone, be, and hereby is,
authorized, empowered and directed, for and on behalf of this corporation, to
execute any and all further documents or instruments and to take any further
actions as may be necessary, proper or advisable in order to effectuate the
intent and purposes of the foregoing resolutions.”

     

    The
undersigned further declare under penalty of perjury under the laws of the State
of Delaware that the matters set forth in this Certificate of Designation of
Preferences and Rights are true and correct of our own knowledge.

     

    
      	
              DATED:                      April 2,
      2004

            	
               

               

               

               /s/ David
      Duquette                                                             

              David
      Duquette, President and

              Chief
      Executive Office

               

               

            
	 
      	
               /s/ Josef
      Czikmantori                                                             

              Josef
      Czikmantori, Secretary

               

            

    

    
 

     

    21

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