Exhibit 3.2
[graphic DEAN HELLER
omitted] Secretary of State
204 North Carson Street, Suite 1
Carson City, Nevada 89701-4299
(775) 884 5708
Webalte: secretaryofstate.biz
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CERTIFICATE OF DESIGNATION
(PURSUANT TO NRS 78.1955)
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Important. Read attached Instructions before completing form. ABOVE SPACE IS FOR
OFFICE USE ONLY
CERTIFICATE OF DESIGNATION
FOR NEVADA PROFIT CORPORATIONS
(PURSUANT TO NRS 78.1955)
1. Name of corporation:
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GLOBALOPTIONS GROUP, INC.
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2. By resolution of the board of directors pursuant to a provision in the
articles of incorporation, this certificate establishes the following regarding
the voting powers, designations, preferences, limitations, restrictions and
relative rights, of the following class or series of stock:
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Series A Convertible Preferred Stock: 16,000 shares with a par value of $.001
per share and with designations, powers, preferences and other rights as set
forth in the attached exhibit.
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3. Effective date of filing (optional) _________________________________________
(must not be later than 90 days after the
certificate is filed)
4. Officer Signature: /s/ Carla L. Santia
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FILING FEE: $175.00
IMPORTANT: Failure to include any of the above information and submit the proper
fees may cause this filing to be rejected.
SUBMIT IN DUPLICATE
This form must be accompanied by appropriate fees. See attached feeschedule.
CERTIFICATE OF DESIGNATIONS, POWERS,
PREFERENCES AND OTHER RIGHTS
AND QUALIFICATIONS OF
SERIES A CONVERTIBLE PREFERRED STOCK
(PURSUANT TO SECTION 78.1955 OF THE
NEVADA GENERAL CORPORATION LAW)
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GLOBALOPTIONS GROUP, INC., a corporation organized and existing under the
Nevada General Corporation Law formerly known as Creative Solutions with Art,
Inc. (the "CORPORATION"), hereby certifies that the following resolution was
adopted by the Board of Directors (the "BOARD") of the Corporation on June 24,
2005 pursuant to the authority of the Board as required by Section 78.1955 of
the Nevada General Corporation Law:
RESOLVED, that pursuant to the authority vested in the Board in accordance
with the provisions of the Articles of Incorporation, as amended (the "ARTICLES
OF INCORPORATION"), of the Corporation, the Board hereby authorizes a series of
the Corporation's previously authorized Preferred Stock, par value $0.001 per
share, and hereby states the designation and number of shares, and fixes the
relative rights, preferences, privileges, powers and restrictions thereof as
follows:
Series A Convertible Preferred Stock:
1. DESIGNATION AND NUMBER OF SHARES. There shall be a series of Preferred
Stock that shall be designated as "SERIES A CONVERTIBLE PREFERRED Stock," and
the number of shares constituting such series shall be 16,000 shares. Such
number of shares may be increased or decreased by resolution of the Board;
PROVIDED, HOWEVER, that no decrease shall reduce the number of shares of Series
A Convertible Preferred Stock to less than the number of shares then issued and
outstanding plus the number of shares issuable upon exercise of outstanding
rights, options or warrants or upon conversion of outstanding securities issued
by the Corporation.
2. RANKING. The Series A Convertible Preferred Stock shall, with respect to
distribution rights upon the Liquidation (as defined in Section 3 below) of the
Corporation, rank (a) subject to clause (b), senior to the common stock, par
value $0.001 per share, of the Corporation (the "COMMON STOCK"), and all other
preferred stock of the Company, and (b) as applicable, junior to or on a parity
with such preferred stock of the Company the terms of which expressly provide
that such preferred stock will rank senior to or on a parity with the Series A
Convertible Preferred Stock.
3. Liquidation.
(a) Upon any liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, which shall include, but not be
limited to, the events set forth in Section 9(f)(i)-(v) below (a "LIQUIDATION"),
the holders of record of the shares of the Series A Convertible Preferred Stock
shall be entitled to receive, immediately after any distributions required by
the Corporation's Articles of Incorporation and any certificate(s) of
designation, powers, preferences and rights in respect of any securities of the
Corporation having priority over the Series A Convertible Preferred Stock with
respect to the distribution of the assets of the Corporation upon Liquidation,
and before and in preference to any distribution or payment of assets of the
Corporation or the proceeds thereof may be made or set apart with respect to any
securities of the Corporation over which the Series A Convertible Preferred
Stock has priority with respect to the distribution of the assets of the
Corporation upon Liquidation ("JUNIOR SECURITIES"), an amount in cash with
respect to each share of Series A Convertible Preferred Stock held by such
holders, equal to $1,000 per share (subject to adjustment in the event of stock
splits, combinations or similar events). If, upon such Liquidation, the assets
of the Corporation available for distribution to the holders of Series A
Convertible Preferred Stock and any securities of the Corporation having equal
priority with the Series A Convertible Preferred Stock with respect to the
distribution of the assets of the Corporation upon Liquidation ("PARITY
SECURITIES") shall be insufficient to permit payment in full to the holders of
the Series A Convertible Preferred Stock and Parity Securities, then the entire
assets and funds of the Corporation legally available for distribution to such
holders of the Series A Convertible Preferred Stock and Parity Securities then
outstanding shall be distributed ratably among such holders based upon the
proportion the total amount distributable on each share upon liquidation bears
to the aggregate amount available for distribution on all shares of the Series A
Convertible Preferred Stock and of such Parity Securities, if any. Except as
otherwise specifically provided, the consolidation or merger of the Corporation
with another person, or the sale, transfer or lease of all or substantially all
of its assets to another person shall not be deemed to be a Liquidation within
the meaning of this Section 3(a).
(b) Upon the completion of the distributions required by paragraph (a)
of this Section 3, if assets remain in the Corporation, they shall be
distributed to holders of Series A Convertible Preferred Stock pro rata with
holders of Junior Securities, based on the number of shares of Common Stock into
which the the Series A Convertible Preferred Stock is convertible at the then
effective Conversion Rate (as defined below).
4. DIVIDENDS. The Series A Convertible Preferred Stock shall not be
entitled to receive dividends or other distributions from the Corporation,
except to the extent that dividends are declared on the Common Stock, in which
case holders of Series A Convertible Preferred Stock will be entitled to receive
such dividends based on the number of shares of Common Stock into which the
Series A Convertible Preferred Stock is convertible at the then effective
Conversion Rate.
5. CONVERSION RIGHTS. Each holder of record of shares of the Series A
Convertible Preferred Stock shall have the right to convert all or any part of
such holder's shares of Series A Convertible Preferred Stock into Common Stock,
without any further payment therefor, as follows:
(a) OPTIONAL CONVERSION. Subject to and upon compliance with the
provisions of this Section 5, the holder of any shares of Series A Convertible
Preferred Stock shall have the right at such holder's option, at any time and
from time to time, to convert any of such shares of Series A Convertible
Preferred Stock into fully paid and non-assessable whole shares of Common Stock.
Each share of Series A Convertible Preferred Stock shall initially be
convertible into 500 shares of Common Stock (the "CONVERSION RATE"), subject to
adjustment upon the terms hereinafter set forth.
(b) Mechanics of Conversion.
(i) Before any holder of Series A Convertible Preferred Stock
shall be entitled to convert the same into shares of Common Stock, such
holder shall surrender the certificate or certificates therefor, duly
endorsed, at the office of the Corporation or of any transfer agent for the
Series A Convertible Preferred Stock, and shall give written notice to the
Corporation at its principal corporate office, of the election to convert
the same and shall state therein the name or names in which the certificate
or certificates for shares of Common Stock are to be issued. The
Corporation shall, as soon as practicable thereafter, issue and deliver at
such office to such holder of Series A Convertible Preferred Stock, or to
the nominee or nominees of such holder, a certificate or certificates for
the number of shares of Common Stock to which such holder shall be entitled
as aforesaid. Conversion shall be deemed to have been effected on the date
when a notice of an election to convert and properly endorsed certificates
are delivered, and such date is referred to herein as the "CONVERSION
DATE."
(ii) All Common Stock which may be issued upon conversion of the
Series A Convertible Preferred Stock will, upon issuance, be duly issued,
fully paid and non-assessable and free from all taxes, liens, and charges
with respect to the issuance thereof.
(c) FRACTIONAL SHARES. No fractional shares shall be issued upon
conversion of Series A Convertible Preferred Stock into Common Stock and the
number of shares of Common Stock to be issued shall be rounded to the nearest
whole share. If any fractional share of Common Stock would, except for the
provisions of the first sentence of this Section 5(c), be delivered upon such
conversion, the Corporation, in lieu of delivering such fractional share, shall
pay to the holder surrendering the Class A Preferred Stock for conversion an
amount in cash equal to the current market price of such fractional share as
determined in good faith by the Board.
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(d) CONVERSION RATE ADJUSTMENTS. The Conversion Rate shall be subject
to the adjustment provisions of Section 6 below.
6. ANTI-DILUTION PROVISIONS. During the period in which any shares of
Series A Convertible Preferred Stock remain outstanding, the Conversion Rate in
effect at any time, and the number and kind of securities issuable upon the
conversion of the Series A Convertible Preferred Stock, shall be subject to
adjustment from time to time following the date of the original issuance of the
Series A Convertible Preferred Stock upon the happening of certain events as
follows:
(a) RECAPITALIZATION, RECLASSIFICATION AND SUCCESSION. If any
recapitalization of the Corporation or reclassification of its Common Stock or
any merger or consolidation of the Corporation into or with a corporation or
other business entity, or the sale or transfer of all or substantially all of
the Corporation's assets or of any successor corporation's assets to any other
corporation or business entity (any such corporation or other business entity
being included within the meaning of the term "successor corporation") shall be
effected then, as a condition of such recapitalization, reclassification,
merger, consolidation, sale or transfer, lawful and adequate provision shall be
made whereby each holder of shares of Series A Convertible Preferred Stock
thereafter shall have the right to receive such shares of capital stock,
securities or other property as may be issued or payable with respect to or in
exchange for a number of outstanding shares of Common Stock equal to the number
of shares of Common Stock immediately theretofore issuable upon conversion of
the shares of Series A Convertible Preferred Stock held by such holder prior to
such recapitalization, reclassification, merger, consolidation, sale or
transfer, and in each such case, the terms of this Section 6 shall be applicable
to the shares of stock or other securities or property receivable upon the
conversion of such shares of Series A Convertible Preferred Stock after such
consummation.
(b) SUBDIVISION OR COMBINATION OF SHARES. If the Corporation shall
subdivide or combine its Common Stock, the Conversion Rate shall be
proportionately adjusted.
(c) STOCK DIVIDENDS AND DISTRIBUTIONS. If the Corporation shall issue
or pay the holders of its Common Stock, or take a record of the holders of its
Common Stock for the purpose of entitling them to receive, a dividend payable
in, or other distribution of, Common Stock, then the Conversion Rate shall be
adjusted to the number of shares of Common Stock that a holder of a share of
Series A Convertible Preferred Stock would have owned immediately following such
action had such share of Series A Convertible Preferred Stock been converted
immediately prior thereto.
(d) VALUATION ADJUSTMENT.
(i) If the Corporation has issued, or shall be deemed to have
issued, Additional Shares of Common Stock (as hereinafter defined) for a
consideration per share less than $2.00 per share or with a per share
conversion, exercise or exchange price of less than $2.00 per share (each,
a "Triggering Issuance" and such lesser consideration or per share
conversion, exercise or exchange price, the "Adjusted Price"), then and in
such event, the Conversion Rate shall be adjusted to $1,000 divided by the
Adjusted Price, but in no event shall the denominator be less than $.765
per share.
(ii) As used herein, "Additional Shares of Common Stock" shall
mean all shares of Common Stock, or any stock options, warrants,
convertible securities or other rights to purchase or acquire shares of
Common Stock, issued or deemed to be issued by the Corporation after the
date hereof which represent a Triggering Issuance. Notwithstanding the
foregoing, no issuance or deemed issuance (A) described in subsections (a),
(b) or (c) of this Section 6, or (B) of Common Stock or options or warrants
to purchase Common Stock issued to officers, directors or employees of or
consultants to the Corporation pursuant to any compensation agreement, plan
or arrangement, or the issuance of Common Stock upon the exercise of any
such options or warrants, shall be deemed the issuance of Additional Shares
of Common Stock.
(e) CERTAIN SHARES EXCLUDED. The number of shares of Common Stock
outstanding at any given time for purposes of the adjustments set forth in this
Section 6 shall exclude any shares then directly or indirectly held in the
treasury of the Corporation.
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(f) DEFERRAL AND CUMULATION OF DE MINIMIS ADJUSTMENTS. The Corporation
shall not be required to make any adjustment pursuant to this Section 6 if the
amount of such adjustment would be less than one percent (1%) of the Conversion
Rate in effect immediately before the event that would otherwise have given rise
to such adjustment. In such case, however, any adjustment that would otherwise
have been required to be made shall be made at the time of and together with the
next subsequent adjustment which, together with any adjustment or adjustments so
carried forward, shall amount to not less than one percent (1%) of the
Conversion Rate in effect immediately before the event giving rise to such next
subsequent adjustment. All calculations under this Section 6 shall be made to
the nearest one-hundredth of a share, as the case may be, but in no event shall
the Corporation be obligated to issue fractional shares of Common Stock or
fractional portions of any securities upon the conversion of the Series A
Convertible Preferred Stock.
(g) DURATION OF ADJUSTMENT. Following each computation or readjustment
as provided in this Section 6, the new adjusted Conversion Rate shall remain in
effect until a further computation or readjustment thereof is required.
7. REDEMPTION. The Corporation may not redeem the outstanding shares of
Series A Convertible Preferred Stock and the holders shall not have any right,
at any time or under any circumstances, to require the Corporation to redeem any
of the Series A Convertible Preferred Stock.
8. VOTING RIGHTS.
(a) Except as otherwise required by law, the holders of shares of
Series A Convertible Preferred Stock shall be entitled to vote on all matters
submitted to a vote of the stockholders of the Corporation and shall have such
number of votes equal to the largest whole number of shares of Common Stock into
which such holders' shares of Series A Convertible Preferred Stock are
convertible pursuant to the provisions hereof at the record date for the
determination of stockholders entitled to vote on such matters or, if no such
record date is established, at the date such vote is taken or any written
consent of stockholders is solicited. Except as otherwise required by law, the
holders of shares of Series A Convertible Preferred Stock and Common Stock shall
vote together as a single class, and not as separate classes.
(b) In the event that the holders of the Series A Convertible
Preferred Stock are required to vote as a class, the affirmative vote of holders
of not less than a majority of the outstanding shares of Series A Convertible
Preferred Stock shall be required to approve each such matter to be voted upon,
and if any matter is approved by such requisite percentage of holders of Series
A Convertible Preferred Stock, such matter shall bind all holders of Series A
Convertible Preferred Stock.
9. COVENANTS OF THE COMPANY. The Corporation covenants and agrees that, so
long as shares of Series A Convertible Preferred Stock are outstanding, it will
perform the obligations set forth in this Section 9:
(a) TAXES AND LEVIES. The Corporation will promptly pay and discharge
all taxes, assessments, and governmental charges or levies imposed upon the
Corporation or upon its income and profits, or upon any of its property, before
the same shall become delinquent, as well as all claims for labor, materials and
supplies which, if unpaid, might become a lien or charge upon such properties or
any part thereof; PROVIDED, HOWEVER, that the Corporation shall not be required
to pay and discharge any such tax, assessment, charge, levy or claim so long as
the validity thereof shall be contested in good faith by appropriate proceedings
and the Corporation shall set aside on its books adequate reserves in accordance
with generally accepted accounting principles ("GAAP") with respect to any such
tax, assessment, charge, levy or claim so contested;
(b) MAINTENANCE OF EXISTENCE. The Corporation will do or cause to be
done all things reasonably necessary to preserve and keep in full force and
effect its corporate existence, rights and franchises and comply with all laws
applicable to the Corporation, except where the failure to comply would not have
a material adverse effect on the Corporation;
(c) MAINTENANCE OF PROPERTY. The Corporation will at all times
maintain, preserve, protect and keep its property used or useful in the conduct
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of its business in good repair, working order and condition, and from time to
time make all needful and proper repairs, renewals, replacements and
improvements thereto as shall be reasonably required in the conduct of its
business;
(d) INSURANCE. The Corporation will, to the extent necessary for the
operation of its business, keep adequately insured by financially sound
reputable insurers, all property of a character usually insured by similar
corporations and carry such other insurance as is usually carried by similar
corporations;
(e) BOOKS AND RECORDS. The Corporation will at all times keep true and
correct books, records and accounts reflecting all of its business affairs and
transactions materially in accordance with GAAP; and
(f) NOTICE OF CERTAIN EVENTS. The Corporation will give prompt written
notice (with a description in reasonable detail) to the holders of Series A
Convertible Preferred Stock in the event the Corporation shall:
(i) become insolvent or generally fail or be unable to pay, or
admit in writing its inability to pay, its debts as they become due;
(ii) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for the Corporation or
any of its property, or make a general assignment for the benefit of
creditors;
(iii) in the absence of such application, consent or acquiesce
in, permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for the Corporation or for any part of its
property;
(iv) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement or other case or proceeding
under any bankruptcy or insolvency law, or any dissolution, winding up or
liquidation proceeding, in respect of the Corporation, and, if such case or
proceeding is not commenced by the Corporation or converted to a voluntary
case, such case or proceeding shall be consented to or acquiesced in by the
Corporation or shall result in the entry of an order for relief;
(v) enter into any agreement to merge or consolidate with any
other person or sell, transfer or lease all or substantially all of its
assets to any other person; or
(vi) declare any split of its outstanding shares of capital
stock, declare or make any dividend or distribution, or subdivide,
reclassify or combine any of its outstanding shares of capital stock.
(g) PROTECTIVE PROVISIONS. So long as any shares of Series A
Convertible Preferred Stock are outstanding, the Corporation shall not, without
first obtaining the approval (by vote or written consent) as provided by the
Nevada General Corporation Law of the holders of not less than a majority of the
outstanding shares of Series A Convertible Preferred Stock:
(i) alter, amend or repeal (whether by merger, consolidation or
otherwise) the rights, preferences or privileges of the Series A
Convertible Preferred Stock or any capital stock of the Corporation so as
to affect adversely the Series A Convertible Preferred Stock;
(ii) alter, amend or repeal, the Articles of Incorporation or
By-laws of the Corporation in a manner that would adversely affect the
voting power of the Series A Convertible Preferred Stock or any other
rights or privileges of the holders of the Series A Convertible Preferred
Stock;
(iii) create any new class or series of capital stock having a
preference over the Series A Convertible Preferred Stock as to distribution
of assets upon a Liquidation ("SENIOR SECURITIES");
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(iv) create any new class or series of capital stock ranking PARI
PASSU with the Series A Convertible Preferred Stock as to distribution of
assets upon a Liquidation (as previously defined in Section 3(a) hereof,
"Parity Securities");
(v) increase the authorized number of shares of Series A
Convertible Preferred Stock;
(vi) issue any Senior Securities or Parity Securities; or
(vii) do any act or thing not authorized or contemplated by this
Certificate of Designations which would result in taxation of the holders
of shares of the Series A Convertible Preferred Stock under Section 305 of
the Internal Revenue Code of 1986, as amended (or any comparable provision
of the Internal Revenue Code as hereafter from time to time amended).
10. RESERVATION OF SHARES. The Corporation shall at all times reserve and
keep available and free of preemptive rights out of its authorized but unissued
Common Stock, solely for the purpose of effecting the conversion of the Series A
Convertible Preferred Stock pursuant to the terms hereof, such number of its
shares of Common Stock (or other shares or other securities as may be required)
as shall from time to time be sufficient to effect the conversion of all
outstanding Series A Convertible Preferred Stock pursuant to the terms hereof.
If at any time the number of authorized but unissued shares of Common Stock (or
such other shares or other securities) shall not be sufficient to affect the
conversion of all then outstanding Series A Convertible Preferred Stock, the
Corporation shall promptly take such action as may be necessary to increase its
authorized but unissued Common Stock (or other shares or other securities) to
such number of shares as shall be sufficient for such purpose.
11. Miscellaneous.
(a) There is no sinking fund with respect to the Series A Convertible
Preferred Stock.
(b) The shares of the Series A Convertible Preferred Stock shall not
have any preferences, voting powers or relative, participating, optional,
preemptive or other special rights except as set forth above in this Certificate
of Designations and in the Articles of Incorporation of the Corporation.
(c) The holders of the Series A Convertible Preferred Stock shall be
entitled to receive all communications sent by the Corporation to the holders of
the Common Stock.
(d) Holders of a majority of the outstanding shares of Series A
Convertible Preferred Stock may, voting as a single class, elect to waive any
provision of these Articles of Amendment Designating Series A Convertible
Preferred Stock, and the affirmative vote of such percentage with respect to any
proposed waiver of any of the provisions contained herein shall bind all holders
of Series A Convertible Preferred Stock.
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IN WITNESS WHEREOF, GlobalOptions Group, Inc. has caused this Certificate
of Designations to be signed by its President, on this 24th day of June 2005,
and such person hereby affirms under penalty of perjury that this Certificate of
Designations is the act and deed of GlobalOptions Group, Inc., and that the
facts stated herein are true and correct.
GLOBALOPTIONS GROUP, INC.
By: /s/ Carla L. Santia
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Carla L. Santia
President
