State of Delaware
Office of the Secretary of State
Page 1
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED ARE TRUE AND CORRECT COPIES OF ALL DOCUMENTS FILED FROM AND INCLUDING THE RESTATED CERTIFICATE OF "PERMA-FIX ENVIRONMENTAL SERVICES, INC." AS RECEIVED AND FILED IN THIS OFFICE.
THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:
RESTATED CERTIFICATE, FILED THE TWENTY-SIXTH DAY OF NOVEMBER, A.D. 1991, AT 10 O'CLOCK A.M.
CERTIFICATE OF AMENDMENT, CHANGING ITS NAME FROM "NATIONAL ENVIRONMENTAL INDUSTRIES, LTD." TO "PERMA-FIX ENVIRONMENTAL SERVICES, INC.", FILED THE SEVENTEENTH DAY OF DECEMBER, A.D. 1991, AT 4:30 O'CLOCK A.M.
CERTIFICATE OF AMENDMENT, FILED THE FOURTH DAY OF SEPTEMBER, A.D. 1992, AT 11:30 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE SIXTH DAY OF FEBRUARY, A.D. 1996, AT 4 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE TWENTIETH DAY OF FEBRUARY, A.D. 1996, AT 10:45 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE NINETEENTH DAY OF JULY, A.D. 1996, AT 12:30 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE SIXTEENTH DAY OF DECEMBER, A.D. 1996, AT 4:30 O'CLOCK P.M.
CERTIFICATE OF AMENDMENT, FILED THE SIXTH DAY OF JANUARY, A.D. 1997, AT 4:30 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE ELEVENTH DAY OF JUNE, A.D. 1997, AT 11 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE FOURTEENTH DAY OF JULY, A.D. 1997, AT 11:15 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE THIRTEENTH DAY OF NOVEMBER, A.D. 1997, AT 1:30 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION FILED THE THIRTEENTH DAY OF NOVEMBER, A.D. 1997, AT 1:31 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE TWENTH-SIXTH DAY OF NOVEMBER, A.D. 1997, AT 10 O'CLOCK A.M.
CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF JULY, A.D. 1998, AT 12 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE SIXTEENTH DAY OF JULY, A.D. 1998, AT 1:30 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE SIXTEENTH DAY OF JULY, A.D. 1998, AT 1:31 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE SIXTEENTH DAY OF JULY, A.D. 1998, AT 1:32 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:30 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION,FILED THE FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:31 O'CLOCK P.M.
CERTIFICATE OF DESIGANTION, FILED THE FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:32 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE FIFTEENTH DAY OF JULY, A.D. 1999, AT 12:33 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST, A.D. 1999, AT 12:30 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST, A.D. 1999, AT 12:31 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST, A.D. 1999, AT 12:32 O'CLOCK P.M.
CERTIFICATE OF DESIGNATION, FILED THE TENTH DAY OF AUGUST, A.D. 1999, AT 12:33 O'CLOCK P.M.
THE CERTIFICATE OF RESTATED CERTIFICATE OF "NATIONAL ENVIRONMENTAL INDUSTRIES, LTD." FILED IN THIS OFFICE ON THE TWENTY- SIXTH DAY OF NOVEMBER, A.D. 1991 AT 10 O'CLOCK A.M.
/s/ Edward J. Freel
Edward J. Freel, Secretary of State
2249849 8100X AUTHENTICATION: 0642864
001433866 DATE: 08-28-00
RESTATED CERTIFICATE OF INCORPORATION
OF
NATIONAL ENVIRONMENTAL INDUSTRIES, LTD.
1. The present name of the corporation (hereinaftercalled the "Corporation") is National Environmental Industries,Ltd., and the date of filing the original certificate ofincorporation of the Corporation with the Secretary of State of theState of Delaware is December 19, 1990.
2. The certificate of incorporation of the Corporationis hereby amended by striking out Articles FOURTH through NINTHthereof and by substituting in lieu thereof new Articles FOURTHthrough NINTH as set forth in the Restated Certificate ofIncorporation hereinafter provided for.
3. The provisions of the certificate of incorporationas heretofore amended and/or supplemented, and as herein amended,are hereby restated and integrated into the single instrument whichis hereinafter set forth, and which is entitled RestatedCertificate of Incorporation of National Environmental Industries,Ltd. without any further amendment other than the amendmentcertified herein and without any discrepancy between the
provisionsof the certificate of incorporation as heretofore amended andsupplemented and the provisions of the said single instrumenthereinafter set forth.
4. The amendment and restatement of the certificate ofincorporation herein certified have been duly adopted by thestockholders in accordance with the provisions of Sections 228, 242and 245 of the General Corporation Law of the State of Delaware. Prompt written notice of the adoption of the amendment and of therestatement of the certificate of incorporation herein certifiedhas been given to those stockholders who have not consented inwriting thereto, as provided in Section 228 of the GeneralCorporation Law of the State of Delaware.
5. The certificate of incorporation of the Corporation,as amended and restated herein, shall at the effective time of thisRestated Certificate of Incorporation, read as follows:
"Restated Certificate of Incorporation
of
National Environmental Industries, Ltd.
FIRST: The name of the Corporation is NationalEnvironmental Industries, Ltd.
SECOND: The address of the Corporation's registeredoffice in the State of Delaware is 32 Loockerman Square, Suite L-100, City of Dover, County of Dover. The name of its registeredagent at such address is The Prentice-Hall Corporation System, Inc.
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THIRD: The purpose of the Corporation is to engage inany lawful act or activity for which a corporation may be organizedunder the laws of the General Corproation Law of the State ofDelaware.
FOURTH: The total number of shares of capital stock which the Corporation shall have authority to issue is Twenty-Two Million (22,000,000) shares, of which Twenty Million (20,000,000)shares shall be Common Stock, par value $.001 per share, and TwoMillion (2,000,000) shares shall be Preferred Stock, $.001 parvalue per share.
The Preferred Stock may be issued from time to time in one or more series. The Board of Directors is hereby expressly authorized to provide, by resolution or resolutions duly adopted by it prior to issuance, for the creation of each such series and to fix the designation and the powers, preferences, rights, qualifications, limitations and restrictions relating to the shares of each such series. The authority of the Board of Directors with respect to each such series of Preferred Stock shall include, but not be limited to, determining the following:
(a) the designation of such series, the number of shares to constitute such series and the stated value if different from the par value thereof;
(b) whether the shares of such series shall have voting rights, in addition to any voting rights provided by law, and, if so, the terms of such voting rights, which may be generalor limited;
3
(c) the dividends, if any, payable on such series, whether any such dividends shall be cumulative, and, if so, from what dates, the conditions and dates upon which such dividends shall be payable, and the preference or relation which such dividends shall bear to the dividends payable on any shares of stock of any other class or any other series of Preferred Stock;
(d) whether the shares of such series shall be subject to redemption by the Corporation, and, if so, the times, prices and other conditions of such redemption;
(e) the amount or amounts payable upon shares of suchseries upon, and the rights of the holders of such series in,the voluntary or involuntary liquidation, dissolution orwinding up, or upon any distribution of the assets of theCorporation;
(f) whether the shares of such series shall be subject to the operation of a retirement or sinking fund and, if so, the extent to and manner in which any such retirement or sinking fund shall be applied to the purchase or redemption of the shares of such series for retirement or other corporate purposes and the terms and provisions relating to the operation thereof;
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(g) whether the shares of such series shall be convertible into, or exchangeable for, shares of stock of any other class or any other series of Preferred Stock or any other securities and, if so, the price or prices or the rate or rates of conversion or exchange and the method, if any, of adjusting the same, and any other terms and conditions of conversion or exchange;
(h) the limitations and restrictions, if any, to be effective while any shares of such series are outstanding upon the payment of dividends or the making of other distributions on, and upon the purchase, redemption or other acquisition by the Corporation of, the Common Stock or shares of stock of any other class or any other series of Preferred Stock;
(i) the conditions or restrictions, if any, upon the creation of indebtedness of the Corporation or upon the issue of any additional stock, including additional shares of such series or of any other series of Preferred Stock or of any other class; and
(j) any other powers, preferences and relative participating, optional and other special rights, and any qualifications, limitations and restrictions thereof.
The powers, preferences and relative, participating, optional and other special rights of each series of Preferred Stock, and the qualifications, limitations or restrictions thereof,
5
if any, may differ from those of any and all other series at any time outstanding. All shares of any one series of Preferred Stock shall be identical in all respects with all other shares of such series, except that shares of any one series issued at different times may differ as to the dates from which dividends thereof shall be cumulative.
FIFTH: Unless required by law or determined by the chairman of the meeting to be advisable, the vote by stockholders on any matter, including the election of directors, need not be by written ballot.
SIXTH: The Corporation reserves the right to increase or decrease its authorized capital stock, or any class or series thereof, and to reclassify the same, and to amend, alter, change or repeal any provision contained in the Certificate of Incorporation under which the Corporation is organized or in any amendment thereto, in the manner now or hereafter prescribed by law, and all rights conferred upon stockholders in said Certificate of Incorporation or any amendment thereto are granted subject to the aforementioned reservation.
SEVENTH: The Board of Directors shall have the power at any time, and from time to time, to adopt, amend and repeal any and all By-Laws of the Corporation.
EIGHTH: All persons who the Corporation is empowered to indemnify pursuant to the provisions of Section 145 of the General Corporation Law of the State of Delaware (or any similar provision or provisions
6
of applicable law at the time in effect), shall be indemnified by the Corporation to the full extent permitted thereby. The foregoing right of indemnification shall not be deemed to be exclusive of any other rights to which those seeking indemnification maybe entitled under any by-law, agreement, vote of stockholders or disinterested directors, or otherwise. No repeal or amendment of this Article EIGHTH shall adversely affect any rights of any person pursuant to this Article Eighth which existed at the time of such repeal or amendment with respect to acts or omissions occurring prior to such repeal or amendment.
NINTH: No director of the Corporation shall be personally liable to the Corporation or its stockholders for any monetary damages for breaches of fiduciary duty as a director, provided that this provisions shall not eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders; (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (iii) under Section 174 of the General Corporation Law of the State of Delaware; or (iv) for any transaction from which the director derived an improper personal benefit. No repeal or amendment of this Article NINTH shall adversely affect any rights of any person pursuant to this
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Article NINTH which existed at the time of such repeal or amendment withrespect to acts or omissions occurring prior to such repeal oramendment."
IN WITNESS WHEREOF, we have signed this Certificate this22nd day of November, 1991.
/s/ Louis Centofanti
President
ATTEST:
/s/ Carol A. Dixon
Secretary
8
CERTIFICATE OF AMENDMENT
TO THE
RESTATED CERTIFICATE OF INCORPORATION
OF
NATIONAL ENVIRONMENTAL INDUSTRIES, LTD.
It is hereby certified that:
1. The name of the corporation (hereinafter called the "Corporation") is National Environmental Industries, Ltd.
2. The Restated Certificate of Incorporation is hereby amended by striking out Article FIRST thereof and by substitutingin lieu of said Article FIRST the following new Article:
"FIRST: The name of the Corporation is Perma-Fix Environmental Services, Inc."
3. The amendment of the Certificate of Incorporation herein certified has been duly adopted in accordance with the provisions of Sections 228 and 242 of the General Corporation Law of the State of Delaware. Prompt written notice of the adoption of the amendment herein certified has been given to those stockholders who have not consented in writing thereto, as provided in Section 228 of the General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, we have signed this Certificate this 16th day of December, 1991.
/s/ Louis Centofanti
Louis Centofanti, President
ATTEST:
/s/ Mark Zwecker
Mark Zwecker, Secretary
CERTIFICATE OF AMENDMENT
TO
RESTATED CERTIFICATE OF INCORPORATION, AS AMENDED
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc., a Delawarecorporation (the "Corporation"), does hereby certify:
That the amendment set forth below to the Corporation's Restated Certificate of Incorporation, as amended, was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware and written notice thereof has been given as provided in Section 228 thereof:
I) The first paragraph of Article FOURTH of theCorporation's Restated Certificate of Incorporation, as amended, ishereby deleted and replaced in its entirety by the following:
Fourth: The total number of shares of capitalstock that the Corporation shall have
authority toissue is 22,000,000 shares of which 20,000,000shares of the par value
of $.001 per share shall bedesignated Common Stock ("Common Stock"), and
2,000,000 shares of the par value of $.001 pershare shall be designated Preferred
Stock.
As of September 4, 1992 (the "Effective Time"), each share of Common Stock issued
and outstanding immediately prior to the Effective Time shall automatically be changed
and converted, without any action on the part of the holder thereof, into 1/3.0236956
of a share of Common Stock and, in connection with fractional interests in shares of
Common Stock of the Corporation, each holder whose aggregate holdings of shares
of Common stock prior to the Effective Time amounted to less than 3.0236956, or
to a number not evenly divisible by 3.0236956 shares of Common Stock shall be
entitled to receive for such fractional interest, and at such time, any such fractional
interest in shares of Common Stock of the Corporation shall be converted into the
right to receive, upon surrender of the stock certificates formerly representing
shares of Common Stock of the Corporation, one whole share of Common Stock.
IN WITNESS whereof, Perma-Fix Environmental Services,Inc. has caused this Certificate to be signed and attested to byits duly authorized officers as of this first day of September,1992.
Perma-Fix Environmental Services, Inc.
By:/s/ Louis Centofanti
Dr. Louis F. Centofanti
President
ATTEST:
By: /s/ Mark Zwecker
Secretary
981311720
CERTIFICATE OF DESIGNATIONS
OF SERIES I CLASS A PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board ofDirectors by the Corporation's Certificate of Incorporation, asamended, and pursuant to the provisions of Section 151 of theDelaware Corporation Law, said Board of Directors, acting byunanimous written consent in lieu of a meeting dated February 2,1996, hereby adopted the terms of the Series I Class A PreferredStock, which resolutions are set forth on the attached page.
Dated: February 2, 1996
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis F. Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Mark A. Zwecker
Mark A. Zwecker, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE SERIES I CLASS A
PREFERRED STOCK
WHEREAS,
A. The Corporation's share capital includes Preferred Stock, parvalue $.001 per share ("Preferred Stock"),
which PreferredStock may be issued in one or more series with the directorsof the Corporation (the
"Board") being entitled by resolutionto fix the number of shares in each series and to designatethe
rights, designations, preferences, and relative,participating, optional or other special rights, privileges,
restrictions and conditions attaching to the shares of eachsuch series; and
B. It is in the best interests of the Corporation for the Board to create a new series from the Preferred
Stock designated asthe Series I Class A Preferred Stock, par value $.001.
NOW, THEREFORE, BE IT RESOLVED, THAT:
The Series I Class A Preferred Stock, par value $.001 (the"Series I Class A Preferred Stock") of the
Corporation shallconsist of 1,100 shares and no more and shall be designated asthe Series I Class A
Preferred Stock and in addition to thepreferences, rights, privileges, restrictions and conditions
attaching to all the Series I Class A Preferred Stock as aseries, the rights, privileges, restrictions
and conditionsattaching to the Series I Class A Preferred Stock shall be asfollows:
Part 1 - Voting and Preemptive Rights.
1.1 Except as otherwise provided herein, in the Certificate of Incorporation (the "Articles") or the General Corporation Law of the State of Delaware (the "GCL"), each holder of Series I Class A Preferred Stock, by virtue of his ownership thereof, shall be entitled to cast that number of votes per share thereof on each matter submitted to the Corporation's shareholders for voting which equals the number of votes which could be cast by such holder of the number of shares of the Corporation's Common Stock, par value $.001 per share (the "Common Shares") into which such shares of Series I Class A Preferred Stock would be converted into pursuant to Part 5 hereof immediately prior to the record date of such vote. The outstanding Series I Class A Preferred Stock and the Common Shares of the Corporation shall vote together as a single class, except as otherwise expressly required by the GCL or Part 7 hereof. The Series I Class A Preferred Stock shall not have cumulative voting rights.
1.2 The Series I Class A Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any Series I Class A Preferred Stock shall be outstanding, the holders of the then outstanding Series I Class A Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Common Shares equal to $1,000 consideration per outstanding share of Series I Class A Preferred Stock, together with an amount equal to all unpaid dividends accrued thereon, if any, to the date of payment of such distribution, whether or not declared by the Board;provided,however, that the merger of the Corporation with any corporation or corporations in which the Corporation is not the survivor, or the sale or transfer by the Corporation of all or substantially all of its property, or any reduction by at least seventy percent (70%) of the then issued and outstanding Common Shares of the Corporation, shall be deemed to be a liquidation of the Corporation within the meaning of any of the provisions of this Part 2.
2.2 Subject to the provisions of Part 6 hereof, all amounts to be paid as preferential distributions to the holders of Series I Class A Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of Common Shares, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
Part 3 - Dividends.
3.1 Holders of record of Series I Class A Preferred Stock, out of funds legally available therefor and to the extent permitted by law, shall be entitled to receive dividends on their Series I Class A Preferred Stock, which dividends shall accrue at the rate per share of five percent (5%) per annum of consideration paid for each share of Series I Class A Preferred Stock ($50.00 per share per year for each full year) commencing on the date of the issuance thereof, payable, at the option of the Corporation, (i) in cash, or (ii) by the issuance of that number of whole Common Shares computed by dividing the amount of the dividend by the market price applicable to such dividend.
3.2 For the purposes of this Part 3 and Part 4 hereof, "market price" means the average of the daily closing prices of Common Shares for a period of five (5) consecutive trading days ending on the date on which any dividend becomes payable or of any notice of redemption as the case may be. The closing price for each trading day shall be (i) for any period during which the Common Shares shall be listed for trading on a national securities exchange, the last reported bid price per share of Common Shares as reported by the primary stock exchange, or the Nasdaq Stock Market, if the Common Shares are quoted on the Nasdaq Stock Market, or (ii) if last sales price information is not available, the average closing bid price of Common Shares as reported
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by the Nasdaq Stock Market, or if not so listed or reported, then as reported by National Quotation Bureau, Incorporated, or (iii) in the event neither clause (i) nor (ii) is applicable, the average of the closing bid and asked prices as furnished by any member of the National Association of Securities Dealers, Inc., selected from time to time by the Corporation for that purpose.
3.3 Dividends on Series I Class A Preferred Stock shall becumulative, and no dividends or other distributions shall be paidor declared and set aside for payment on the Common Shares untilfull cumulative dividends on all outstanding Series I Class A Preferred Stock shall have been paid or declared and set aside for payment.
3.4 Dividends shall be payable in arrears, at the rate of $12.50 per share for each full calendar quarter on each February 28, May 31, August 31, and November 30 of each calendar year, to the holders of record of the Series I Class A Preferred Stock as they appear in the securities register of the Corporation on such record dates not more than sixty (60) nor less than ten (10) days preceding the payment date thereof, as shall be fixed by the Board; provided, however, that the initial dividend for the Series I Class A Preferred Stock shall accrue for the period commencing on the date of the issuance thereof to and including December 31, 1995.
3.5 If, in any quarter, insufficient funds are available to pay such dividends as are then due and payable with respect to the Series I Class A Preferred Stock and all other classes and series of the capital stock of the Corporation ranking in parity therewith (or such payment is otherwise prohibited by provisions of the GCL, such funds as are legally available to pay such dividends shall be paid or Common Shares will be issued as stock dividends to the holders of Series I Class A Preferred Stock and to the holders of any other series of Class A Preferred Stock then outstanding as provided in Part 6 hereof, in accordance with the rights of each such holder, and the balance of accrued but undeclared and/or unpaid dividends, if any, shall be declared and paid on the next succeeding dividend date to the extent that funds are then legally available for such purpose.
Part 4 - Redemption.
4.1 At any time, and from time to time, on and after one hundred twenty (120) days from the date of the issuance of any Series I Class A Preferred Stock, if the average of the closing bid prices for the Common Shares for five (5) consecutive trading days shall be in excess of $1.50, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, the then outstanding Series I Class A Preferred Stock at a price per share of U. S. $1,000 each (the "Redemption Price") (such price to be adjusted proportionately in the event of any change of the Series I Class A Shares into a different number of Shares).
4.2 Thirty (30) days prior to any date stipulated by the Corporation for the redemption of Series I Class A Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series I Class A Preferred Stock. The Redemption Notice shall
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state: (i) the Redemption Date of such Shares, (ii) the number of Series I Class A Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated of a share certificate or share certificates representing the number of Series I Class A Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series I Class A Preferred Stock to be redeemed as provided in this Part 4, and the number of shares to be converted into Common Shares as provided in Part 5 hereof.
4.3 Upon receipt of the Redemption Notice, any Eligible Holder (as defined in Section 5.2 hereof) shall have the option, at its sole election, to specify what portion of its Series I Class A Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 4 or converted into Common Shares in the manner provided in Part 5 hereof, except that, notwithstanding any provision of such Part 5 to the contrary, any Eligible Holder shall have the right to convert into Common Shares that number of Series I Class A Preferred Stock called for redemption in the Redemption Notice.
4.4 On or before the Redemption Date in respect of any Series I Class A Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.5 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series I Class A Shares which are not being redeemed to be registered in the names of the persons whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
4.5 On the Redemption Date in respect of any Series I Class A Shares or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series I Class A Shares in respect of which the Corporation has received notice from the Eligible Holder thereof of its election to convert Series I Class A Shares in to Common Shares), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed share shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares
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called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 5 - Conversion.
5.1 For the purposes of conversion of the Series I Class APreferred Stock shall be valued at $1,000 per share ("Value"), and,if converted, the Series I Class A Preferred Stock shall beconverted into such number of Common Shares (the "ConversionShares") as is obtained by dividing the aggregate Value of theshares of Series I Class A Preferred Stock being so converted,together with all accrued but unpaid dividends thereon, by the "Average Stock Price" per share of the Conversion Shares (the "Conversion Price"), subject to adjustment pursuant to the provisions of this Part 5. For purposes of this Part 5, the "Average Stock Price" means the lesser of (x) seventy percent (70%) of the average daily closing bid prices of the Common Shares for the period of five (5) consecutive trading days immediately preceding the date of subscription by the Holder or (y) seventy percent (70%) of the daily average closing bid prices of Common Shares for the period of five (5) consecutive trading days immediately preceding the date of the conversion of the Series I Class A Preferred Stock in respect of which such Average Stock Price is determined. The closing price for each trading day shall be determined as provided in the last sentence of Section 3.2.
5.2 Any holder of Series I Class A Preferred Stock (an "Eligible Holder") may at any time commencing forty-five (45) days after the issuance of any Series I Class A Preferred Stock convert up to one hundred percent (100%) of his holdings of Series I Class A Preferred Stock in accordance with this Part 5.
5.3 The conversion right granted by Section 5.2 hereof may be exercised only by an Eligible Holder of Series I Class A Preferred Stock, in whole or in part, by the surrender of the share certificate or share certificates representing the Series I Class A Preferred Stock to be converted at the principal office of the Corporation (or at such other place as the Corporation may designate in a written notice sent to the holder by first class mail, postage prepaid, at its address shown on the books of the Corporation) against delivery of that number of whole Common Shares as shall be computed by dividing (1) the aggregate Value of the Series I Class A Preferred Stock so surrendered for conversion plus any accrued but unpaid dividends thereon, if any, by (2) the Conversion Price in effect at the date of the conversion. At the time of conversion of a share of the Series I Class A Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, issue that number of whole Common Shares which is equal to the product of dividing the amount of such unpaid dividends by the Average Stock Price whether or not declared by the Board. Each Series I Class A Preferred Stock share certificate surrendered for conversion shall be endorsed by its holder. In the event of any exercise of the conversion right of the Series I Class A Preferred Stock granted herein (i) share certificate representing the Common Shares purchased by virtue of such exercise shall be delivered to such holder within three (3) days of notice of conversion, and (ii) unless the Series I Class A Preferred Stock has been fully converted, a new share certificate representing the Series I Class A Preferred Stock not so converted, if any, shall also be delivered to
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such holder within three (3) days of notice of conversion. Any Eligible Holder may exercise its right to convert the Series I Class A Preferred Stock by telecopying an executed and completed Notice of Conversion to the Corporation, and within seventy-two (72) hours thereafter, delivering the original Notice of Conversion and the certificate representing the Series I Class A Preferred Stock to the Corporation by express courier. Each date on which a Notice of Conversion is telecopied to and received by the Corporation in accordance with the provisions hereof shall be deemed a conversion date. The Corporation will transmit the Common Shares certificates issuable upon conversion of any Series I Class A Preferred Stock (together with the certificates representing the Series I Class A Preferred Stock not so converted) to the Eligible Holder via express courier within three (3) business days after the conversion date if the Corporation has received the original Notice of Conversion and the Series I Class A Shares certificates being so converted by such date.
5.4 All Common Shares which may be issued upon conversion of Series I Class A Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof. At all times that any Series I Class A Preferred Stock is outstanding, the Corporation shall have authorized, and shall have reserved for the purpose of issuance upon such conversion, a sufficient number of Common Shares to provide for the conversion into Common Shares of all Series I Class A Preferred Stock then outstanding at the then effective Conversion Price. Without limiting the generality of the foregoing, if, at any time, the Conversion Price is decreased, the number of Common Shares authorized and reserved for issuance upon the conversion of the Series I Class A Preferred Stock shall be proportionately increased.
5.5 The number of Common Shares issued upon conversion of Series I Class A Preferred Stock and the Conversion Price shall be subject to adjustment from time to time upon the happening of certain events, as follows:
5.5.1 Change of Designation of the Common Shares or the rights, privileges, restrictions and conditions
in respect of the Common Shares or division of the Common Shares into series. In the case of any
amendment to the Articles to change the designation of the Common Shares or the rights, privileges,
restrictions or conditions in respect of the Common Shares or division of the Common Shares into series
the rights of the holders of the Series I Class A Preferred Stock shall be adjusted so as to provide that
upon conversion thereof, the holder of the Series I Class A Preferred Stock being converted shall procure,
in lieu of each Common Share theretofore issuable upon such conversion, the kind and amount of shares,
other securities, money and property receivable upon such designation, change or division by the holder of
one Common Share issuable upon such conversion had conversion occurred immediately prior to such
designation, change or division. The Series I Class A Preferred Stock shall be deemed thereafter to
provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments
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provided for in this Part 5. The provisions of this subsection 5.5.1 shall apply in the same manner to
successive reclassifications, changes, consolidations, and mergers.
5.5.2 If the Corporation, at any time while any of the Series I Class A Preferred Stock is outstanding,
shall amend the Articles so as to change the Common Shares into a different number of shares, the
Conversion Price shall be proportionately reduced, in case of such change increasing the number
of Common Shares, as of the effective date of such increase, or if the Corporation shall take a record
of holders of its Common Shares for the purpose of such increase, as of such record date, whichever
is earlier, or the Conversion Price shall be proportionately increased, in the case of such change
decreasing the number of Common Shares, as of the effective date of such decrease or, if the
Corporation shall take a record of holders of its Common Stock for the purpose of such decrease,
as of such record date, whichever is earlier.
5.5.3 If the Corporation, at any time while any of the Series I Class A Preferred Stock is outstanding,
shall pay a dividend payable in Common Shares (except for any dividends of Common Shares
payable pursuant to Part 3 hereof), the Conversion Price shall be adjusted, as of the date the
Corporation shall take a record of the holders of its Common Shares for the purposes of receiving
such dividend (or if no such record is taken, as of the date of payment of such dividend), to that
price determined by multiplying the Conversion Price therefor in effect by a fraction (1) the numerator
of which shall be the total number of Common Shares outstanding immediately prior to such dividend,
and (2) the denominator of which shall be the total number of Common Shares outstanding
immediately after such dividend (plus in the event that the Corporation paid cash for fractional shares,
the number of additional shares which would have been outstanding had the Corporation issued
�� fractional shares in connection with said dividend).
5.6 Whenever the Conversion Price shall be adjusted pursuant to Section 5.5 hereof, the Corporation shall make a certificate signed by its President, or a Vice President and by its Treasurer, Assistant Treasurer, Secretary or Assistant Secretary, setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated (including a description of the basis on which the Board of Directors made any determination hereunder), and the Conversion Price after giving effect to such adjustment, and shall cause copies of such certificates to be mailed (by first class mail, postage prepaid) to each holder of the Series I Class APreferred Stock at its address shown on the books of theCorporation. The Corporation shall make such certificate and mailit to each such holder promptly after each adjustment.
5.7 No fractional Common Shares shall be issued in connection with any conversion of Series I Class A Preferred Stock, but in lieu of such fractional shares, the Corporation shall make a cash payment therefor equal in amount to the product of the applicable fraction multiplied by the Conversion Price then in effect.
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5.8 No Series I Class A Preferred Stock which has been converted into Common Shares shall be reissued by the Corporation; provided, however, that each such share shall be restored to the status of authorized but unissued Preferred Stock without designation as to series and may thereafter be issued as a series of Preferred Stock not designated as Series I Class A Preferred Stock.
Part 6 - Parity with Other Shares of Class A Preferred Shares.
6.1 If any cumulative dividends or accounts payable or return of capital in respect of Series I Class A Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
Part 7 - Amendment.
7.1 In addition to any requirement for a series vote pursuant to the GCL in respect of any amendment to the Corporation's Certificate of Incorporation that adversely affects the rights, privileges, restrictions and conditions of the Series I Class A Preferred Stock, the rights, privileges, restrictions and conditions attaching to the Series I Class A Preferred Stock may be amended by an amendment to the Corporation's Certificate of Incorporation so as to affect such adversely only if the Corporation has obtained the affirmative vote at a duly called and held series meeting of the holders of the Series I Class A Preferred Stock or written consent by the holders of a majority of the Series I Class A Preferred Stock then outstanding. Notwithstanding the above, the number of authorized shares of such class or classes of stock may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting as a single class, irrespective of this Section 7.1.
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CERTIFICATE OF DESIGNATIONS
OF SERIES 2 CLASS B CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), acorporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 2 Class B Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 2 Class B Convertible Preferred Stock as set forth in the attached resolutions.
Dated: February 16, 1996
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis F. Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Mark A. Zwecker
Mark A. Zwecker, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 2 CLASS B CONVERTIBLE PREFERRED STOCK
WHEREAS,
A. The Corporation's share capital includes Preferred Stock, par value $.001 per share ("Preferred Stock"),
which Preferred Stock may be issued in one or more series with the directors of the Corporation (the
"Board") being entitled by resolution to fix the number of shares in each series and to designate the
rights, designations, preferences, and relative, participating, optional or other special rights, privileges,
restrictions and conditions attaching to the shares of each such series; and
B. It is in the best interests of the Corporation for the Board to create a new series from the Preferred
Stock designated as the Series 2 Class B Convertible Preferred Stock, par value$.001.
NOW, THEREFORE, BE IT RESOLVED, THAT:
The Series 2 Class B Convertible Preferred Stock, par value $.001 (the "Series 2 Class B Preferred
Stock") of the Corporation shall consist of 2,500 shares and no more and shall be designated as the
Series 2 Class B Preferred Stock and in addition to the preferences, rights, privileges, restrictions
and conditions attaching to all the Series 2 Class B Preferred Stock as a series, the rights,
privileges, restrictions and conditions attaching to the Series 2 Class B Preferred Stock shall be
as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Except as otherwise provided herein, in the Corporation's Certificate of Incorporation (the "Articles") or the General Corporation Law of the State of Delaware (the "GCL"), each holder of Series 2 Class B Preferred Stock, by virtue of his ownership thereof, shall be entitled to cast that number of votes per share thereof on each matter submitted to the Corporation's shareholders for voting which equals the number of votes which could be cast by such holder of the number of shares of the Corporation's Common Stock, par value $.001 per share (the "Common Shares") into which such shares of Series 2 Class B Preferred Stock would be entitled to be converted into pursuant to Part 5 hereof on the record date of such vote. The outstanding Series 2 Class B Preferred Stock, the Common Shares of the Corporation and any other series of Preferred Stock of the Corporation having voting rights shall vote together as a single class, except as otherwise expressly required by the GCL or Part 7 hereof. The Series 2 Class B Preferred Stock shall not have cumulative voting rights.
1.2 The Series 2 Class B Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any Series 2 Class B Preferred Stock shall be outstanding, the holders of the then outstanding Series 2 Class B Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Common Shares equal to $1,000 consideration per outstanding share of Series 2 Class B Preferred Stock, together with an amount equal to all unpaid dividends accrued thereon, if any, to the date of payment of such distribution, whether or not declared by the Board; provided, however, that the merger of the Corporation with any corporation or corporations in which the Corporation is not the survivor, or the sale or transfer by the Corporation of all or substantially all of its property, or a reduction by at least seventy percent (70%) of the then issued and outstanding Common Shares of the Corporation, shall be deemed to be a liquidation of the Corporation within the meaning of any of the provisions of this Part 2.
2.2 Subject to the provisions of Part 6 hereof, all amounts to be paid as preferential distributions to the holders of Series 2 Class B Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of Common Shares, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3 After the payment to the holders of the shares of the Series 2 Class B Preferred Stock of the full preferential amounts provided for in this Part 2, the holders of the Series 2 Class B Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4 In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 2 Class B Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 2 Class B Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 2 Class B Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 2 Class B Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
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Part 3 - Dividends.
3.1 Holders of record of Series 2 Class B Preferred Stock, out of funds legally available therefor and to the extent permitted by law, shall be entitled to receive dividends on their Series 2 Class B Preferred Stock, which dividends shall accrue at the rate per share of five percent (5%) per annum of consideration paid for each share of Series 2 Class B Preferred Stock ($50.00 per share per year for each full year) commencing on the date of the issuance thereof, payable, at the option of the Corporation, (i) in cash, or (ii) by the issuance of that number of whole Common Shares computed by dividing the amount of the dividend by the market price applicable to such dividend.
3.2 For the purposes of this Part 3 and Part 4 hereof, "market price" means the average of the daily closing prices of Common Shares for a period of five (5) consecutive trading days ending on the date on which any dividend becomes payable or of any notice of redemption as the case may be. The closing price for each trading day shall be (i) for any period during which the Common Shares shall be listed for trading on a national securities exchange, the last reported bid price per share of Common Shares as reported by the primary stock exchange, or the Nasdaq Stock Market, if the Common Shares are quoted on the Nasdaq Stock Market, or (ii) if last sales price information is not available, the average closing bid price of Common Shares as reported by the Nasdaq Stock Market, or if not so listed or reported, then as reported by National Quotation Bureau, Incorporated, or (iii) in the event neither clause (i) nor (ii) is applicable, the average of the closing bid and asked prices as furnished by any member of the National Association of Securities Dealers, Inc., selected from time to time by the Corporation for that purpose.
3.3 Dividends on Series 2 Class B Preferred Stock shall becumulative, and no dividends or other distributions shall be paidor declared and set aside for payment on the Common Shares untilfull cumulative dividends on all outstanding Series 2 Class BPreferred Stock shall have been paid or declared and set aside forpayment.
3.4 Dividends shall be payable in arrears, at the rate of $12.50per share for each full calendar quarter on each February 28, May31, August 31, and November 30 of each calendar year, to theholders of record of the Series 2 Class B Preferred Stock as theyappear in the securities register of the Corporation on such recorddates not more than sixty (60) nor less than ten (10) dayspreceding the payment date thereof, as shall be fixed by the Board;provided, however, that the initial dividend for the Series 2 ClassB Preferred Stock shall accrue for the period commencing on thedate of the issuance thereof.
3.5 If, in any quarter, insufficient funds are available to pay such dividends as are then due and payable with respect to the Series 2 Class B Preferred Stock and all other classes and series of the capital stock of the Corporation ranking in parity therewith (or such payment is otherwise prohibited by provisions of the GCL, such funds as are legally available to pay such dividends shall be paid or Common Shares will be issued as stock dividends to the holders of Series 2 Class B Preferred Stock and to the holders of any other series of
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Class B Preferred Stock then outstanding as provided in Part 6 hereof, in accordance with the rights of each such holder, and the balance of accrued but undeclared and/or unpaid dividends, if any, shall be declared and paid on the next succeeding dividend date to the extent that funds are then legally available for such purpose.
Part 4 - Redemption.
4.1 At any time, and from time to time, on and after one hundred twenty (120) days from the date of the issuance of any Series 2 Class B Preferred Stock, if the average of the closing bid prices for the Common Shares for five (5) consecutive trading days shall be in excess of $1.50 per share, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, the then outstanding Series 2 Class B Preferred Stock at a price per share of U. S. $1,000 each (the "Redemption Price") (such price to be adjusted proportionately in the event of any change of the Series 2 Class B Preferred Stock into a different number of shares of Series 2 Class B Preferred Stock).
4.2 Thirty (30) days prior to any date stipulated by the Corporation for the redemption of Series 2 Class B Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 2 Class B Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 2 Class B Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated of a share certificate or share certificates representing the number of Series 2 Class B Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 2 Class B Preferred Stock to be redeemed as provided in this Part 4, and the number of shares to be converted into Common Shares as provided in Part 5 hereof.
4.3 Upon receipt of the Redemption Notice, any Eligible Holder (as defined in Section 5.2 hereof) shall have the option, at its sole election, to specify what portion of its Series 2 Class B Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 4 or converted into Common Shares in the manner provided in Part 5 hereof, except that, notwithstanding any provision of such Part 5 to the contrary, any Eligible Holder shall have the right to convert into Common Shares that number of Series 2 Class B Preferred Stock called for redemption in the Redemption Notice.
4.4 On or before the Redemption Date in respect of any Series 2 Class B Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 4.5 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 2
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Class B Preferred Stock which are not being redeemed to be registered in the names of the persons whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
4.5 On the Redemption Date in respect of any Series 2 Class BPreferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 2 Class B Preferred Stock in respect of which the Corporation has received notice from the Eligible Holder thereof of its election to convert Series 2 Class B Preferred Stock in to Common Shares), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed share shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 5 - Conversion.
5.1 For the purposes of conversion of the Series 2 Class B Preferred Stock shall be valued at $1,000 per share ("Value"), and, if converted, the Series 2 Class B Preferred Stock shall be converted into such number of Common Shares (the "Conversion Shares") as is obtained by dividing the aggregate Value of the shares of Series 2 Class B Preferred Stock being so converted, together with all accrued but unpaid dividends thereon, by the "Average Stock Price" per share of the Conversion Shares (the "Conversion Price"), subject to adjustment pursuant to the provisions of this Part 5. For purposes of this Part 5, the "Average Stock Price" means the lesser of (x) seventy percent (70%) of the average daily closing bid prices of the Common Shares for a period of five (5) consecutive trading days immediately preceding the date of subscription by the Holder or (y) seventy percent (70%) of the average daily closing bid prices of Common Shares for the period of five (5) consecutive trading days immediately preceding the date of the conversion of the Series 2 Class B Preferred Stock in respect of which such Average Stock Price is determined. The closing price for each trading day shall be determined as provided in the last sentence of Section 3.2.
5.2 Any holder of Series 2 Class B Preferred Stock (an "Eligible Holder") may at any time commencing forty-five (45) days after the issuance of any Series 2 Class B Preferred Stock convert up to one hundred percent (100%) of his holdings of Series 2 Class B Preferred Stock in accordance with this Part 5.
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5.3 The conversion right granted by Section 5.2 hereof may be exercised only by an Eligible Holder of Series 2 Class B Preferred Stock, in whole or in part, by the surrender of the share certificate or share certificates representing the Series 2 Class B Preferred Stock to be converted at the principal office of the Corporation (or at such other place as the Corporation may designate in a written notice sent to the holder by first class mail, postage prepaid, at its address shown on the books of the Corporation) against delivery of that number of whole Common Sharesas shall be computed by dividing (1) the aggregate Value of theSeries 2 Class B Preferred Stock so surrendered for conversion plusany accrued but unpaid dividends thereon, if any, by (2) theConversion Price in effect at the date of the conversion. At thetime of conversion of a share of the Series 2 Class B Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, issue that number of whole Common Shares which is equal to the product of dividing the amount of such unpaid dividends by the Average Stock Price whether or not declared by the Board. Each Series 2 Class B Preferred Stock share certificate surrendered for conversion shall be endorsed by its holder. In the event of any exercise of the conversion right of the Series 2 Class B Preferred Stock granted herein (i) share certificate representing the Common Shares purchased by virtue of such exercise shall be delivered to such holder within three (3) days of notice of conversion, and (ii) unless the Series 2 Class B Preferred Stock has been fully converted, a new share certificate representing the Series 2 Class B Preferred Stock not so converted, if any, shall also be delivered to such holder within three (3) days of notice of conversion. Any Eligible Holder may exercise its right to convert the Series 2 Class B Preferred Stock by telecopying an executed and completed Notice of Conversion to the Corporation, and within seventy-two (72) hours thereafter, delivering the original Notice of Conversion and the certificate representing the Series 2 Class B Preferred Stock to the Corporation by express courier. Each date on which a Notice of Conversion is telecopied to and received by the Corporation in accordance with the provisions hereof shall be deemed a conversion date. The Corporation will transmit the Common Shares certificates issuable upon conversion of any Series 2 Class B Preferred Stock (together with the certificates representing the Series 2 Class B Preferred Stock not so converted) to the Eligible Holder via express courier within three (3) business days after the conversion date if the Corporation has received the original Notice of Conversion and the Series 2 Class B Shares certificates being so converted by such date.
5.4 All Common Shares which may be issued upon conversion of Series 2 Class B Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof. At all times that any Series 2 Class B Preferred Stock is outstanding, the Corporation shall have authorized, and shall have reserved for the purpose of issuance upon such conversion, a sufficient number of Common Shares to provide for the conversion into Common Shares of all Series 2 Class B Preferred Stock then outstanding at the then effective Conversion Price. Without limiting the generality of the foregoing, if, at any time, the Conversion Price is decreased, the number of Common Shares authorized and reserved for issuance upon the conversion of the Series 2 Class B Preferred Stock shall be proportionately increased.
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5.5 The number of Common Shares issued upon conversion of Series 2 Class B Preferred Stock and the Conversion Price shall be subject to adjustment from time to time upon the happening of certain events, as follows:
5.5.1 In the case of any amendment to the Articles to change the designation of the Common Shares
or the rights, privileges, restrictions or conditions in respect of the Common Shares or division of the
Common Shares into series the rights of the holders of the Series 2 Class B Preferred Stock shall be
adjusted so as to provide that upon conversion thereof, the holder of the Series 2 Class B Preferred
Stock being converted shall procure, in lieu of each Common Share theretofore issuable upon such
conversion, the kind and amount of shares, other securities, money and property receivable upon such
designation, change or division by the holder of one Common Share issuable upon such conversion
had conversion occurred immediately prior to such designation, change or division. The Series 2
Class B Preferred Stock shall be deemed thereafter to provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this Part 5. The provisions
of this subsection 5.5.1 shall apply in the same manner to successive reclassifications, changes,
consolidations, and mergers.
5.5.2 If the Corporation, at any time while any of the Series 2 Class B Preferred Stock is outstanding,
shall amend the Articles so as to change the Common Shares into a different number of shares, the
Conversion Price shall be proportionately reduced, in case of such change increasing thenumber of
Common Shares, as of the effective date of suchincrease, or if the Corporation shall take a record of
holders of its Common Shares for the purpose of such increase, as of such record date, whichever is
earlier, or the Conversion Price shall be proportionately increased, in the case of such change
decreasing the number of Common Shares, as of the effective date of such decrease or, if the
Corporation shall take a record of holders of its Common Stock for the purpose of such decrease,
as of such record date, whichever is earlier.
5.5.3 If the Corporation, at any time while any of the Series 2 Class B Preferred Stock is outstanding,
shall pay a dividend payable in Common Shares (except for any dividends of Common Shares
payable pursuant to Part 3 hereof), the Conversion Price shall be adjusted, as of the date the
Corporation shall take a record of the holders of its Common Shares for the purposes of receiving
such dividend (or if no such record is taken, as of the date of payment of such dividend), to that price
determined by multiplying the Conversion Price therefor in effect by a fraction (1) the numerator of
which shall be the total number of Common Shares outstanding immediately prior to such dividend,
and (2) the denominator of which shall be the total number of Common Shares outstanding
immediately after such dividend (plus in the event that the Corporation paid cash for fractional shares,
the number of additional shares which would have been outstanding had the Corporation issued
fractional shares in connection with said dividend).
5.6 Whenever the Conversion Price shall be adjusted pursuant to Section 5.5 hereof, the Corporation shall make a certificate signed by its President, or a Vice President and by its Treasurer, Assistant Treasurer,
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Secretary or Assistant Secretary, setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated (including a description of the basis on which the Board of Directors made any determination hereunder), and the Conversion Price after giving effect to such adjustment, and shall cause copies of such certificates to be mailed (by first class mail, postage prepaid) to each holder of the Series 2 Class B Preferred Stock at its address shown on the books of the Corporation. The Corporation shall make such certificate and mail it to each such holder promptly after each adjustment.
5.7 No fractional Common Shares shall be issued in connection with any conversion of Series 2 Class B Preferred Stock, but in lieu of such fractional shares, the Corporation shall make a cash payment therefor equal in amount to the product of the applicable fraction multiplied by the Conversion Price then in effect.
5.8 No Series 2 Class B Preferred Stock which has been converted into Common Shares shall be reissued by the Corporation; provided, however, that each such share shall be restored to the status of authorized but unissued Preferred Stock without designation as to series and may thereafter be issued as a series of Preferred Stock not designated as Series 2 Class B Preferred Stock.
Part 6 - Parity with Other Shares of Series 2 Class B Preferred Stock and Priority.
6.1 If any cumulative dividends or accounts payable or return of capital in respect of Series 2 Class B Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 2 Class B Preferred Stock either as to dividends or
upon liquidation, if the holders of such class or classes shall be entitled to the receipt of dividends
or of amounts distributable upon dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in preference or priority to the holders of shares of
this Series 2 Class B Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 2 Class B Preferred Stock, either as to
dividends or upon liquidation, whether or not the dividend rates, dividend payment dates, or
redemption or liquidation prices per share or sinking fund provisions, if any, are different from those
of this Series 2 Class B Preferred Stock, if the holders of such stock are entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, in proportion to their respective dividend rates or liquidation
prices, without preference or priority, one over the other, as between the holders of such stock and
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over the other, as between the holders of such stock and the holders of shares of this Series 2
Class B Preferred Stock; and,
6.2.3 Junior to shares of this Series 2 Class B Preferred Stock, either as to dividends or upon
liquidation, if such class or series shall be Common Shares or if the holders of shares of this Series
2 Class B Preferred Stock shall be entitled to receipt of dividends or of amounts distributable
upon dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary,
as the case may be, in preference or priority to the holders of shares of such class or series.
Part 7 - Amendment.
7.1 In addition to any requirement for a series vote pursuant tothe GCL in respect of any amendment to the Articles that adverselyaffects the rights, privileges, restrictions and conditions of theSeries 2 Class B Preferred Stock, the rights, privileges,restrictions and conditions attaching to the Series 2 Class BPreferred Stock may be amended by an amendment to the Corporation'sCertificate of Incorporation so as to affect such adversely only if the Corporation has obtained the affirmative vote at a duly called and held series meeting of the holders of the Series 2 Class B Preferred Stock or written consent by the holders of a majority of the Series 2 Class B Preferred Stock then outstanding. Notwithstanding the above, the number of authorized shares of such class or classes of stock may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of this Section 7.1.
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CERTIFICATE OF DESIGNATIONS
OF SERIES 3 CLASS C CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), acorporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 3 Class C Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 3 Class C Convertible Preferred Stock as set forth in the attached resolutions.
Dated: July 17, 1996
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis F. Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 3 CLASS C CONVERTIBLE PREFERRED STOCK
WHEREAS,
A. The Corporation's share capital includes Preferred Stock, par value $.001 per share ("Preferred
Stock"), which Preferred Stock may be issued in one or more series by the Board of Directors
of the Corporation (the "Board") being entitled by resolution to fix the number of shares in each
series and to designate the rights, designations, preferences, and relative, participating, optional
or other special rights, privileges, restrictions and conditions attaching to the shares of each such
series; and
B. It is in the best interests of the Corporation for the Board to create a new series from the Preferred
Stock designated as the Series 3 Class C Convertible Preferred Stock, par value $.001.
NOW, THEREFORE, BE IT RESOLVED, THAT:
The Series 3 Class C Convertible Preferred Stock, par value$.001 (the "Series 3 Class C Preferred
Stock") of theCorporation shall consist of 5,500 shares and no more andshall be designated as the
Series 3 Class C ConvertiblePreferred Stock, and the preferences, rights, privileges,restrictions
and conditions attaching to the Series 3 Class CPreferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided herein, in the Corporation's Certificate of Incorporation (the "Articles") or the General Corporation Law of the State of Delaware (the "GCL"), the holders of the Series 3 Class C Preferred Stock shall have no voting rights whatsoever. To the extent that under the GCL the vote of the holders of the Series 3 Class C Preferred Stock, voting separately as a class or series as applicable, is required to authorize a given action of the Corporation, the affirmative vote or consent of the holders of at least a majority of the shares of the Series 3 Class C Preferred Stock represented at a duly held meeting at which a quorum is present or by written consent of a majority of the shares of Series 3 Class C Preferred Stock (except as otherwise may be required under the GCL) shall constitute the approval of such action by the series. To the extent that under the GCL the holders of the Series 3 Class C Preferred Stock are entitled to vote on a matter with holders of Corporation's Common Stock and/or any other class or series of the Corporation's voting securities, the Series 3 Class C Preferred Stock, the Corporation's Common Stock and all other classes
or series of the Corporation's voting securities shall vote together as one class, with each share of Series 3 Class C Preferred Stock entitled to a number of votes equal to the number of shares of the Corporation's Common Stock into which it is then convertible using the record date for the taking of such vote of stockholders as the date as of which the Conversion Price (as defined in Section 4.2 hereof) is calculated and conversion is effected. Holders of the Series 3 Class C Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 3 Class C Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1Liquidation. If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any shares of the Series 3 Class C Preferred Stock shall beoutstanding, the holders of the then outstanding Series 3 Class C Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Corporation's Common Stock equal to $1,000 consideration per outstanding share of Series 3 Class C Preferred Stock, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of such distribution ("Liquidation Preference"), whether or not declared by the Board.
2.2Payment of Liquidation Preferences. Subject to the provisions of Part 6 hereof, all amounts to be paid as Liquidation Preference to the holders of Series 3 Class C Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of the Corporation's Common Stock, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3No Rights After Payment. After the payment to the holders of the shares of the Series 3 Class C Preferred Stock of the full Liquidation Preference amounts provided for in this Part 2, the holders of the Series 3 Class C Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 3 Class C Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 3 Class C Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 3 Class C Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 3 Class C Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
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Part 3 - Dividends.
3.1 The holders of the Series 3 Class C Preferred Stock areentitled to receive if, when and as declared by the Board out offunds legally available therefor, cumulative dividends, payable incash or Common Stock of the Corporation, par value $.001 per share(the "Common Stock"), at the Corporation's election, at the rate ofsix percent (6%) per annum of the Liquidation Value of the Series3 Class C Preferred Stock. The Liquidation Value of the Series 3 Class C Preferred Stock shall be $1,000.00 per share (the "Dividend Rate"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing December 31, 1996 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 3 Class C Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from the date of issuance of the Series 3 Class C Preferred Stock. In the event that the Corporation elects to pay dividends in Common Stock of the Corporation, each holder of the Series 3 Class C Preferred Stock shall receive shares of Common Stock of the Corporation equal to the quotient of (i) the Dividend Rate in effect on the applicable Dividend Declaration Date dividend by (ii) the average of the closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"). Dividends on the Series 3 Class C Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 3 Class C Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 3 Class C Preferred Stock shall have rights to convert the shares of Series 3 Class C Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1Right to Convert. The Series 3 Class C Preferred Stock shall be convertible into shares of Common Stock, as follows:
4.1.1 Up to one thousand eight hundred thirty-three (1,833) shares of Series 3 Class C Preferred
Stock may be converted at the Conversion Price (as that term is defined in Section 4.2 below)
at any time on or after October 1, 1996;
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4.1.2 Up to one thousand eight hundred thirty-three (1,833) shares of Series 3 Class C Preferred
Stock may be converted at the Conversion Price at any time on or after November 1, 1996; and,
4.1.3 Up to one thousand eight hundred thirty-four (1,834) shares of Series 3 Class C Preferred
Stock may be converted at the Conversion Price on or after December 1, 1996.
4.2 Conversion Price. As used herein, the term Conversion Price shall be the product of (i) the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately preceding the date of the Conversion Notice referred to in Section 4.3 below multiplied by (ii) seventy-five percent (75%). Notwithstanding the foregoing, the Conversion Price shall not be (i) less than a minimum of $.75 per share ("Minimum Conversion Price") or (ii) more than a maximum of $1.50 per share ("Maximum Conversion Price"). If, after July 1, 1996, the Corporation sustains a net loss, on a consolidated basis, in each of two (2) consecutive quarters, as determined under generally accepted accounting principles, the Minimum Conversion Price shall be reduced $.25 a share, but there shall be no change to, or reduction of, the Maximum Conversion Price. For the purpose of determining whether the Corporation has had a net loss in each of two (2) consecutive quarters, at no time shall a quarter that has already been considered in such determination be considered in any subsequent determination (as an example the third quarter of 1996 in which there is a net profit and the fourth quarter of 1996 in which there is a net loss shall be considered as two consecutive quarters, and, as a result, the fourth quarter of 1996 shall not be considered along with the first quarter of 1997 as two (2) consecutive quarters, but the first quarter of 1997 must be considered with the second quarter of 1997 for the purposes of such determination). For the purposes of this Section 4.2, a "quarter" is a three (3) month period ending on March 31, June 30, September 30, and December 31. If any of the outstanding shares of Series 3 Class C Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 3 Class C Preferred Stockso surrendered for conversion by (b) the Conversion Price in effectat the date of the conversion. At the time of conversion of shares of the Series 3 Class C Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the product of dividing the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 3 Class C Preferred Stock so converted by the Conversion Price in effect at the date of conversion.
4.3 Mechanics of Conversion. Any holder of the Series 3 Class C Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the
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Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 3 Class C Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. No Conversion Notice with respect to any shares of Series 3 Class C Preferred Stock can be given prior to the time such shares of Series 3 Class C Preferred Stock are eligible for conversion in accordance with the provision of Section 4.1 above. Any such premature Conversion Notice shall automatically be null and void. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 3 Class C Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 3 Class C Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of Series 3 Class C Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion within five (5) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.3, the Corporation shall pay to the holder U.S. $1,000 for each day that the Corporation is late in delivering such certificate to the holder or its agent.
4.4 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 3 Class C Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate. If the Corporation shall declare or pay, without consideration, any dividend on the Common Stock payable in any right to acquire Common stock for no consideration, then the Corporation shall be deemed to have made a
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dividend payable in Common Stock in an amount of shares equal to the maximum number of shares issuable upon exercise of such rights to acquire Common Stock.
4.5. Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 3 Class 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 4.4 hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 3 Class C Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 3 Class C Preferred Stock 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 3 Class C Preferred Stock immediately before that change.
4.6 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 3 Class C Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof.
4.7 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 3 Class C Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.8 Issue Taxes. The Corporation shall pay any and all issue andother taxes that may be payable in respect of any issue or deliveryof shares of Common Stock on conversion of the Series 3 Class CPreferred Stock pursuant thereto; provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 3 Class C Preferred Stock in connection with such conversion.
4.9 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 3 Class 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 3 Class 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 3 Class C Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
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4.10 Fractional Shares. No fractional share shall be issued upon the conversion of any share or shares of Series 3 Class C Preferred Stock. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series 3 Class 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 fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.11Notices. Any notices required by the provisions of this Part 4 to be given to the holders of shares of Series 3 Class C Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.
4.12Business Day. As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or a day when the federal and state banks located in the State of New York are required or permitted to close.
Part 5 - Redemption.
5.1Redemption During First 180 Days. At any time, and from time to time, during the first one hundred eighty (180) days from the date of issuance of the Series 3 Class C Preferred Stock, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, the then outstanding Series 3 Class C Preferred Stock at a price per share of U. S. $1,300.00 each ("First Six Months Redemption Price"). The Company may exercise such redemption by giving the holder of the Series 3 Class C Preferred Stock written notice of such redemption at any time during such 180-day period.
5.2 Other Rights of Redemption by the Corporation. At any time, and from time to time, after one hundred eighty (180) days from the date of the issuance of any Series 3 Class C Preferred Stock, if the average of the closing bid price of the Common Stock for ten (10) consecutive days shall be in excess of $2.50 per share, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, the then outstanding Series 3 Class C Preferred Stock at a price per share of U. S. $1,000 each (the "Redemption Price") (such price to be adjusted proportionately in the event of any change of the Series 3 Class C Preferred Stock into a different number of shares of Series 3 Class C Preferred Stock).
5.3Mechanics of Redemption. Thirty (30) days prior to any datestipulated by the Corporation for the redemption of Series 3 Class C Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 3 Class C Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 3 Class C Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 3 Class C Preferred Stock to be redeemed from such
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holder, and (iv) instructions as to how to specify to the Corporation the number of Series 3 Class C Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first one hundred eighty (180) days from the date of issuance of the Series 3 Class C Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.4Rights of Conversion Upon Redemption. If the redemption occurs pursuant to Section 5.1 hereof, the Holder of the Series 3 Class C Preferred Stock shall not have the right to convert those outstanding shares of Series 3 Class C Preferred Stock that the Company is redeeming after receipt of the Redemption Notice. If the redemption occurs pursuant to Section 5.2 hereof, then, upon receipt of the Redemption Notice, any holder of Series 3 Class C Preferred Stock shall have the option, at its sole election, to specify what portion of its Series 3 Class C Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, such holder shall have the right to convert into Common Stock that number of Series 3 Class C Preferred Stock called for redemption in the Redemption Notice.
5.5 Surrender of Certificates. On or before the Redemption Date in respect of any Series 3 Class C Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.5 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 3 Class C Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.6 Payment. On the Redemption Date in respect of any Series 3 Class C Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate First Six Months Redemption Price or the Redemption Price, whichever is applicable, of all such shares called from redemption (less the aggregate Redemption Price for those Series 3 Class C Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 3 Class C Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the First Six Months Redemption Price or the Redemption Price, whichever is applicable, to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the
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First Six Months Redemption Price or the Redemption Price, whichever is applicable, of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the First Six Months Redemption Price or the Redemption Price, whichever is applicable, in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 3 Class C Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 3 Class C Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 3 Class C Preferred Stock either as to dividends
or upon liquidation, if the holders of such class or classes shall be entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in preference or priority
to the holders of shares of this Series 3 Class C Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 3 Class C Preferred Stock, either as to
dividends or upon liquidation, whether or not the dividend rates, dividend payment dates, or
redemption or liquidation prices per share or sinking fund provisions, if any, are different from
those of this Series 3 Class C Preferred Stock, if the holders of such stock are entitled to the
receipt of dividends or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, in proportion to their respective dividend rates or
liquidation prices, without preference or priority, one over the other, as between the holders of
such stock and over the other, as between the holders of such stock and the holders of shares
of this Series 3 Class C Preferred Stock; and,
6.2.3 Junior to shares of this Series 3 Class C Preferred Stock, either as to dividends or upon
liquidation, if such class or series shall be Common Stock or if the holders of shares of this
Series 3 Class C Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, whether voluntary
or involuntary, as the case may be, in preference or priority to the holders of shares of such
class or series.
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Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to the Corporation's Certificate of Incorporation would alter or change the powers, preferences or special rights of the Series 3 Class C Preferred Stock so as to affect such adversely, then the Corporation must obtain the affirmative vote of such amendment to the Certificate of Incorporation at a duly called and held series meeting of the holders of the Series 3 Class C Preferred Stock or written consent by the holders of a majority of the Series 3 Class C Preferred Stock then outstanding. Notwithstanding the above, the number of authorized shares of any class or classes of stock may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of this Section 7.1 or the requirements of Section 242 of the GCL.
7.2 Authorized. Any shares of Series 3 Class C Preferred Stock acquired by the Corporation by reason of purchase, conversion,redemption or otherwise shall be retired and shall becomeauthorized but unissued shares of Preferred Stock, which may bereissued as part of a new series of Preferred Stock hereaftercreated.
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CERTIFICATE OF ELIMINATION
OF
SERIES I CLASS A PREFERRED STOCK
AND
SERIES 2 CLASS B CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
____________________________________________
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporationorganized and existing under the Delaware General Corporation Lawof the State of Delaware (hereinafter called the "Corporation"),hereby certifies the following:
1. That the Certificate of Designations of Series I Class APreferred Stock of the Corporation (the "Series I Preferred") wasfiled on February 6, 1996 (the "Series I Certificate ofDesignations").
2. That all outstanding shares of the Series I Preferred have been converted into shares of common stock of the Company pursuant to the terms and conditions of the Series I Certificate of Designations.
3. That no shares of Series I Preferred remain outstanding.
4. That all shares of the Series I Preferred which have been converted have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
5. That on September 19, 1996, the Board of Directors of the company duly adopted the following resolution:
RESOLVED, that no authorized shares of SeriesI Class A Preferred Stock remain outstanding
and no shares of Series I Class A PreferredStock will be issued subject to theCertificate of
Designation previously filedwith respect to the Series I Class A PreferredStock.
6. That the Certificate of Designations of the Series 2 Class B Convertible Preferred Stock of the Corporation (the "Series 2 Preferred") was filed on February 20, 1996 (the "Series 2 Certificate of Designations").
7. That all outstanding shares of the Series 2 Preferred have been converted into shares of common stock of the Company pursuant to the terms and conditions of the Series 2 Certificate of Designations.
8. That no shares of Series 2 Preferred remain outstanding.
9. That all shares of the Series 2 Preferred which have beenconverted have the status of authorized and unissued shares of thePreferred Stock of the Corporation without designation as toseries, until such shares are once more designated as part of aparticular series by the Board of Directors.
10. That on September 19, 1996, the Board of Directors of thecompany duly adopted the following resolution:
RESOLVED, that no authorized shares of Series2 Class B Preferred Stock remain outstanding
and no shares of Series 2 Class B ConvertiblePreferred Stock will be issued subject to the
Certificate of Designation previously filedwith respect to the Series 2 Class BConvertible
Preferred Stock.
11. That pursuant to the provisions of Section 151(g) of theDelaware General Corporation Law, upon the effective date of thefiling of this Certificate, this Certificate will have the effectof eliminating from the Restated Certificate of Incorporation onlythose matters set forth in the Restated Certificate ofIncorporation with respect to the Series I Class A Preferred Stockand the Series 2 Class B Convertible Preferred Stock.
IN WITNESS WHEREOF, this Certificate of Elimination has been executed this 4th day of December, 1996, by the President of the Company.
PERMA-FIX ENVIRONMENTAL
ATTEST: SERVICES, INC.
/s/ Richard T. Kelecy By/s/ Louis Centofanti
Richard T. Kelecy, Secretary Dr. Louis F. Centofanti,
President
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CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
___________________________________________
Perma-Fix Environmental Services, Inc., a Delawarecorporation (the "Corporation"), for purposes of amending itsRestated Certificate of Incorporation, as amended ("RestatedCertificate of Incorporation"), as provided by Section 242 of theDelaware General Corporation Law, does hereby certify:
1. The amendment set forth below to the Corporation'sRestated Certificate of Incorporation was duly adopted inaccordance with the provisions of Section 242 of the GeneralCorporation Law of the State of Delaware:
The first paragraph of Article Fourth of theCorporation's Restated Certificate of Incorporation is herebydeleted and replaced in its entirety by the following:
The total number of shares of capital stock that the Corporation shall have authority to issue
is 52,000,000, of which 50,000,000 shall be designated as common stock of the par value
of $.001 per share ("Common Stock") and 2,000,000 shall be designated as preferred stock
of the par value of $.001 per share ("Preferred Stock").
2. Only the first paragraph of Article Fourth is amended bythis Amendment, and the remainder of Article Fourth shall remain infull force and effect. No other provision, paragraph or article ofthe Restated Certificate of Incorporation is amended or changed bythis Amendment. The Restated Certificate of Incorporation, asexpressly amended by paragraph 1 of this Amendment, shall be infull force and effect.
3. At a meeting of the Board of Directors held on the 19thday of September, 1996, a resolution was duly adopted setting forththe foregoing proposed amendment to the first paragraph of ArticleFourth of the Restated Certificate of Incorporation, declaring suchamendment to be advisable and setting the next Annual Meeting ofStockholders for consideration thereof.
4. Thereafter, pursuant to said resolution of its Board ofDirectors, the Annual Meeting of Stockholders was duly called andheld on December 12, 1996, at which meeting the necessary number ofshares as required by statute were voted in favor of suchamendment.
IN WITNESS whereof, Perma-Fix Environmental Services,Inc. has caused this Certificate to be signed and attested to byits duly authorized officers as of this 16th day of December, 1996.
Perma-Fix Environmental
Services, Inc.,
a Delaware corporation
By:/s/Louis F. Centofanti
Dr. Louis F. Centofanti
President and
Chief Executive Officer
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy,
Secretary
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CERTIFICATE OF DESIGNATIONS
OF SERIES 4 CLASS D CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 4 Class D Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 4 Class D Convertible Preferred Stock as set forth in the attached resolutions.
Dated: June 9, 1997 PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By/s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 4 CLASS C CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock,par value $.001 per share ("Preferred Stock"), which PreferredStock may be issued in one or more series by resolutions adopted bythe directors, and with the directors being entitled by resolutionto fix the number of shares in each series and to designate therights, designations, preferences and relative, participating,optional or other special rights and privileges, restrictions andconditions attaching to the shares of each such series;
WHEREAS,it is in the best interests of the Corporation forthe Board to create a new series from the Preferred Stockdesignated as the Series 4 Class D Convertible Preferred Stock, parvalue $.001 per share ("Series 4 Class D Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 4 Class D Convertible Preferred Stock, par value $.001 (the "Series 4 Class D Preferred Stock") of the Corporation shall consist of two thousand five hundred (2,500) shares and no more and shall be designated as the Series 4 Class D Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 4 Class D Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Part 7 hereofor under the General Corporation Law of the State of Delaware (the"GCL"), the holders of the Series 4 Class D Preferred Stock shallhave no voting rights whatsoever. To the extent that under Part 7 hereof or the GCL the vote of the holders of the Series 4 Class D Preferred Stock, voting separately as a class or series as applicable, is required to authorize a given action of the Corporation, the affirmative vote or consent of the holders of at least a majority of the shares of the Series 4 Class D Preferred Stock represented at a duly held meeting at which a quorum is present or by written consent of a majority of the shares of Series 4 Class D Preferred Stock (except as otherwise may be required under the GCL) shall constitute the approval of such action by the series. To the extent that under the GCL or Part 7 hereof, the holders of the Series 4 Class D Preferred Stock are entitled to vote on a matter, each share of the Series 4 Class D Preferred Stock shall be entitled one (1) vote for each outstanding share of Series 4 Class D Preferred Stock. Holders of the Series 4 Class D Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or
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written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 4 Class D Preferred Stockshall not give its holders any preemptive rights to acquire anyother securities issued by the Corporation at any time in thefuture.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily orinvoluntarily liquidated, dissolved or wound up at any time whenany shares of the Series 4 Class D Preferred Stock shall beoutstanding, the holders of the then outstanding Series 4 Class DPreferred Stock shall have a preference in distribution of theCorporation's property available for distribution to the holders ofthe Corporation's Common Stock equal to $1,000 consideration peroutstanding share of Series 4 Class D Preferred Stock, plus anamount equal to all unpaid dividends accrued thereon to the date ofpayment of such distribution ("Liquidation Preference"), whether ornot declared by the Board.
2.2 Payment of Liquidation Preferences. Subject to the provisionsof Part 6 hereof, all amounts to be paid as Liquidation Preferenceto the holders of Series 4 Class D Preferred Stock, as provided inthis Part 2, shall be paid or set apart for payment before thepayment or setting apart for payment of any amount for, or thedistribution of any of the Corporation's property to the holders ofthe Corporation's Common Stock, whether now or hereafterauthorized, in connection with such liquidation, dissolution orwinding up.
2.3No Rights After Payment. After the payment to the holders ofthe shares of the Series 4 Class D Preferred Stock of the fullLiquidation Preference amounts provided for in this Part 2, theholders of the Series 4 Class D Preferred Stock as such shall haveno right or claim to any of the remaining assets of theCorporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 4 Class D Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 4 Class D Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 4 Class D Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 4 Class D Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
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Part 3 - Dividends.
3.1 The holders of the Series 4 Class D Preferred Stock are entitled to receive if, when and as declared by the Board out of funds legally available therefor, cumulative dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), or any combination thereof, at the Corporation's election, at the rate of four percent (4%) per annum of the Liquidation Value (as defined below) of each issued and outstanding share of Series 4 Class D Preferred Stock (the "Dividend Rate"). The Liquidation Value of the Series 4 Class D Preferred Stock shall be $1,000 per outstanding share of the Series 4 Class D Preferred Stock (the "Liquidation Value"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing December 31, 1997 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 4 Class D Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record of the Series 4 Class D Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from the date of issuance of the Series 4 Class D Preferred Stock. In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on an outstanding share of the Series 4 Class D Preferred Stock in Common Stock of the Corporation, the holder of such share shall receive that number of shares of Common Stock of the Corporation equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the average closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid, and the denominator of which is 365. Dividends on the Series 4 Class D Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 4 Class D Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 4 Class D Preferred Stock shall have rights to convert the shares of Series 4 Class D Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1 Right to Convert. The Series 4 Class D Preferred Stock shallbe convertible into shares of Common Stock, as follows:
4.1.1 Up to one thousand two hundred fifty (1,250) sharesof Series 4 Class D Preferred Stock may
beconverted at the Conversion Price (as that term isdefined in Section 4.2 below) at any time
on orafter October 5, 1997; and,
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4.1.2 Up to an additional one thousand two hundred fifty(1,250) shares of Series 4 Class D
Preferred Stockmay be converted at the Conversion Price at anytime on or after November 5,
1997.
4.2 Conversion Price. Subject to the terms hereof, as usedherein, the term Conversion Price per outstanding share ofSeries 4 Class D Preferred Stock shall be the product of thelesser of (i) the average closing bid quotation of the CommonStock as reported on the over-the-counter market, or theclosing sale price if listed on a national securitiesexchange, for the five (5) trading days immediately precedingthe date of the Conversion Notice referred to in Section 4.3below multiplied by eighty percent (80%) or (ii) U.S. $1.6875.Notwithstanding the foregoing, the Conversion Price shall notbe less than a minimum of $.75 per share ("Minimum ConversionPrice"), which Minimum Conversion Price shall be eliminatedfrom and after September 6, 1998. If any of the outstandingshares of Series 4 Class D Preferred Stock are converted, inwhole or in part, into Common Stock pursuant to the terms ofthis Part 4, the number of shares of whole Common Stock to beissued to the holder as a result of such conversion shall bedetermined by dividing (a) the aggregate Liquidation Value ofthe Series 4 Class D Preferred Stock so surrendered forconversion by (b) the Conversion Price in effect at the dateof the conversion. At the time of conversion of shares of theSeries 4 Class D Preferred Stock, the Corporation shall pay incash to the holder thereof an amount equal to all unpaid andaccrued dividends, if any, accrued thereon to the date ofconversion, or, at the Corporation's option, in lieu of payingcash for the accrued and unpaid dividends, issue that numberof shares of whole Common Stock which is equal to the quotientof the amount of such unpaid and accrued dividends to the dateof conversion on the shares of Series 4 Class D PreferredStock so converted divided by the Stock Dividend Price, asdefined in Section 3.1 hereof, in effect at the date ofconversion.
4.3Mechanics of Conversion. Any holder of the Series 4 Class D Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 4 Class D Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. No Conversion Notice with respect to any shares of Series 4 Class D Preferred Stock can be given prior to the time such shares of Series 4 Class D Preferred Stock are eligible forconversion in accordance with the provision of Section 4.1 above, except as provided in Section 4.4. Any such premature Conversion Notice shall automatically be null and void. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 4 Class D Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to
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the contrary, all shares of Common Stock issuable upon conversion of the Series 4 Class D Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of Series 4 Class D Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion within seven (7) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.3 ("Seven (7) Business Day Period"), then, upon the written demand of RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 4 Class D Preferred Stock, for payment of the penalty described below in this Section 4.3, which demand must be received by the Corporation no later than ten (10) calendar days after the expiration of such Seven (7) Business Day Period, the Corporation shall pay to RBB Bank the following penalty for each business day after the Seven (7) Business Day Period until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion:business day eight (8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day thereafter an amount equalto the penalty due on the immediately preceding business daytimes two (2) until the Corporation delivers to the holder orits agent the certificate representing the shares of CommonStock that the holder is entitled to receive as a result ofsuch conversion.
4.4 Merger or Consolidation. In case of either (a) any merger orconsolidation to which the Corporation is a party(collectively, the "Merger"), other than a Merger in which theCorporation is the surviving or continuing corporation, or (b)any sale or conveyance to another corporation of all, orsubstantially all, of the assets of the Corporation(collectively, the "Sale"), and such Merger or Sale becomeseffective (x) while any shares of Series 4 Class D PreferredStock are outstanding and prior to the date that theCorporation's Registration Statement covering up to 1,482,000shares of Common Stock issuable upon the conversion of theSeries 4 Class D Preferred Stock is declared effective by theU. S. Securities and Exchange Commission or (y) prior to theend of the restriction periods in Section 4.1, then, in suchevent, the Corporation or such successor corporation, as thecase may be, shall make appropriate provision so that theholder of each share of Series 4
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Class D Preferred Stock thenoutstanding shall have the right to convert such share ofSeries 4 Class D Preferred Stock into the kind and amount ofshares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number of sharesof Common Stock into which such shares of Series 4 Class DPreferred Stock could have been converted into immediatelyprior to such Merger or Sale, subject to adjustments whichshall be as nearly equivalent as may be practicable to theadjustments provided for in this Part 4.
4.4 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 4 Class D Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
4.5. Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 4 Class 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 4.4 hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 4 Class D Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 4 Class D Preferred Stock 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 4 Class D Preferred Stock immediately before that change.
4.6 Common Stock Duly Issued. All Common Stock which may beissued upon conversion of Series 4 Class D Preferred Stockwill, upon issuance, be duly issued, fully paid andnonassessable and free from all taxes, liens, and charges withrespect to the issue thereof.4.7 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 4 Class D Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
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4.8 Issue Taxes. The Corporation shall pay any and all issue andother taxes that may be payable in respect of any issue ordelivery of shares of Common Stock on conversion of the Series4 Class D Preferred Stock pursuant thereto; provided, however,that the Corporation shall not be obligated to pay anytransfer taxes resulting from any transfer requested by anyholder of Series 4 Class D Preferred Stock in connection withsuch conversion.
4.9 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 4 Class 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 4 Class 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 4 Class D Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
4.10 Fractional Shares. No fractional shares shall be issued uponthe conversion of any share or shares of Series 4 Class D Preferred Stock. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series 4 Class 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 fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.11 Notices. Any notices required by the provisions of this Part4 to be given to the holders of shares of Series 4 Class DPreferred Stock shall be deemed given if deposited in theUnited States mail, postage prepaid, and addressed to eachholder of record at his address appearing on the books of theCorporation.
4.12 Business Day. As used herein, the term "business day" shallmean any day other than a Saturday, Sunday or a day when thefederal and state banks located in the State of New York arerequired or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwiseprovided in this Section 5.1, at any time, and from time totime, after the expiration of one (1) year from the date ofthe first issuance of the Series 4 Class D
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Preferred Stock,the Corporation may, at its sole option, but shall not beobligated to, redeem, in whole or in part, at any time, andfrom time to time, the then outstanding Series 4 Class DPreferred Stock at the following cash redemption prices pershare (the "Redemption Price") if redeemed during thefollowing periods: (a) within four (4) years from the date ofthe first issuance of Series 4 Class D Preferred Stock -$1,300 per share, if at any time during such four (4) yearperiod the average of the closing bid price of the CommonStock for ten (10) consecutive trading days shall be in excessof Four U.S. Dollars ($4.00) per share, and (b) after four (4)years from the date of the first issuance of Series 4 Class DPreferred Stock - $1,000 per share.
5.3 Mechanics of Redemption. Thirty (30) days prior to any date stipulated by the Corporation for the redemption of Series 4 Class D Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 4 Class D Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 4 Class D Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 4 Class D Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 4 Class D Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first one hundred eighty (180) days from the date of issuance of the Series 4 Class D Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.4 Rights of Conversion Upon Redemption. If the redemptionoccurs after the first one hundred eighty (180) days after the first issuance of Series 4 Class D Preferred Stock, then, upon receipt of the Redemption Notice, any holder of Series 4 Class D Preferred Stock shall have the option, at its sole election, to specify what portion of its Series 4 Class D Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, such holder shall have the right to convert into Common Stock that number of Series 4 Class D Preferred Stock called for redemption in the Redemption Notice.
5.5 Surrender of Certificates. On or before the Redemption Date in respect of any Series 4 Class D Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.6 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is
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surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 4 Class D Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.6 Payment. On the Redemption Date in respect of any Series 4Class D Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 4 Class D Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 4 Class D Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 4 Class D Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 4 Class D Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 4 Class D Preferred Stock either as to dividends or
upon liquidation, if the holders of such class or classes shall be entitled to the receipt of dividends
or of amounts distributable upon dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, as the case may be, in preference or priority to the holders
of shares of this Series 4 Class D Preferred Stock;
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6.2.2 On a parity with, or equal to, shares of thisSeries 4 Class D Preferred Stock, either as todividends
or upon liquidation, whether or not the dividend rates, dividend payment dates, or redemption or
liquidation prices per share or sinking fund provisions, if any, are different from those of this
Series 4 Class C Preferred Stock, if the holders of such stock are entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, in proportion to their respective dividend rates
or liquidation prices, without preference or priority, one over the other, as between theholders
of such stock and over the other, as between the holders of such stock and theholders of shares
of this Series 4 Class D Preferred Stock; and,
6.2.3 Junior to shares of this Series 4 Class D Preferred Stock, either as to dividends or upon liquidation, if such class or series shall be Common Stock or if the holders of shares of this Series 4 Class D Preferred Stock shall be entitled to receipt of dividends or of amounts distributable upon dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, as the case may be, in preference or priority to the holders of shares of such class or series.
Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to theCorporation's Certificate of Incorporation (the"Articles") would alter or change the powers, preferences or special rights of the Series 4 Class D Preferred Stock so as to affect such adversely, then the Corporation must obtain the affirmative vote of such amendment to theArticles at a duly called and held series meeting of the holders of the Series 4 Class D Preferred Stock orwritten consent by the holders of a majority of the Series 4 Class D Preferred Stock then outstanding.Notwithstanding the above or the provisions of the GCL, the number of authorized shares of any class or classesof stock of the Corporation may be increased or decreased (but not below the number of shares thereof outstanding)by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon,voting together as a single class, irrespective of the provisions of this Section 7.1 or Section 242 of the GCL.
7.2 Authorized. Any shares of Series 4 Class D Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
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CERTIFICATE OF DESIGNATIONS
OF SERIES 5 CLASS E CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), acorporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board ofDirectors by the Corporation's Restated Certificate ofIncorporation, as amended, and pursuant to the provisions ofSection 151 of the Delaware Corporation Law, the Board of Directorsof the Corporation has adopted resolutions, a copy of which isattached hereto, establishing and providing for the issuance of aseries of Preferred Stock designated as Series 5 Class EConvertible Preferred Stock and has established and fixed thevoting powers, designations, preferences and relativeparticipating, optional and other special rights andqualifications, limitations and restrictions of such Series 5 ClassE Convertible Preferred Stock as set forth in the attachedresolutions.
Dated: July 3, 1997 PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By/s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 5 CLASS E CONVERTIBLE PREFERRED STOCK
WHEREAS,the Corporation's capital includes preferred stock,par value $.001 per share ("Preferred Stock"), which PreferredStock may be issued in one or more series by resolutions adopted bythe directors, and with the directors being entitled by resolutionto fix the number of shares in each series and to designate therights, designations, preferences and relative, participating,optional or other special rights and privileges, andqualifications, limitations or restrictions attaching to the sharesof each such series;
WHEREAS, it is in the best interests of the Corporation for the Board to create a new series from the Preferred Stock designated as the Series 5 Class E Convertible Preferred Stock, par value $.001 per share ("Series 5 Class E Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 5 Class E Convertible Preferred Stock, par value $.001 (the "Series 5 Class E Preferred Stock") of the Corporation shall consist of three hundred fifty (350) shares and no more and shall be designated as the Series 5 Class E Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 5 Class E Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Section242(b)(2) of the General Corporation Law of the State of Delaware(the "GCL"), the holders of the Series 5 Class E Preferred Stockshall have no voting rights whatsoever. To the extent that underSection 242(b)(2) of the GCL the vote of the holders of the Series5 Class E Preferred Stock, voting separately as a class or seriesas applicable, is required to authorize a given action of theCorporation, the affirmative vote or consent of the holders of atleast a majority of the shares of the Series 5 Class E PreferredStock represented at a duly held meeting at which a quorum ispresent or by written consent of a majority of the shares of Series 5 Class E Preferred Stock (except as otherwise may be required under the GCL) shall constitute the approval of such action by the series. To the extent that under Section 242(b)(2) of the GCL the holders of the Series 5 Class E Preferred Stock are entitled to vote on a matter, each share of the Series 5 Class E Preferred Stock shall be entitled one (1) vote for each outstanding share of Series 5 Class E Preferred Stock. Holders of the Series 5 Class E Preferred Stock shall be entitled to
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notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes. If the holders of the Series 5 Class E Preferred Stock are required to vote under Section 242(b)(2) of the GCL as a result of the number of authorized shares of any such class or classes of stock being increased or decreased, the number of authorized shares of any of such class or classes of stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, irrespective of the provisions of Section 242(b)(2) of the GCL.
1.2 No Preemptive Rights. The Series 5 Class E Preferred Stockshall not give its holders any preemptive rights to acquire anyother securities issued by the Corporation at any time in thefuture.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily orinvoluntarily liquidated, dissolved or wound up at any time whenany shares of the Series 5 Class E Preferred Stock shall beoutstanding, the holders of the then outstanding Series 5 Class EPreferred Stock shall be entitled to receive out of the assets ofthe Corporation available for distribution to shareholders anamount equal to $1,000 consideration per outstanding share ofSeries 5 Class E Preferred Stock, and no more, plus an amount equalto all unpaid dividends accrued thereon to the date of payment ofsuch distribution ("Liquidation Preference"), whether or notdeclared by the Board of Directors, before any payment shall bemade or any assets distributed to the holders of the Corporation'sCommon Stock.
2.2 Payment of Liquidation Preferences. Subject to the provisionsof Part 6 hereof, all amounts to be paid as Liquidation Preferenceto the holders of Series 5 Class E Preferred Stock, as provided inthis Part 2, shall be paid or set apart for payment before thepayment or setting apart for payment of any amount for, or thedistribution of any of the Corporation's property to the holders ofthe Corporation's Common Stock, whether now or hereafterauthorized, in connection with such liquidation, dissolution orwinding up.
2.3 No Rights After Payment. After the payment to the holders ofthe shares of the Series 5 Class E Preferred Stock of the fullLiquidation Preference amounts provided for in this Part 2, theholders of the Series 5 Class E Preferred Stock as such shall haveno right or claim to any of the remaining assets of theCorporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. Inthe event that the assets of the Corporation available for distribution to the holders of shares of the Series 5 Class E Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 5 Class E Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 5 Class E Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 5 Class E Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
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Part 3 - Dividends.
3.1 The holders of the Series 5 Class E Preferred Stock are entitled to receive if, when and as declared by the Board of Directors of the Corporation (the "Board") out of funds legally available therefor, cumulative annual dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), or any combination thereof, at the Corporation's election, at the rate of four percent (4%) per annum of the Liquidation Value (as defined below) of each issued and outstanding share of Series 5 Class E Preferred Stock (the "Dividend Rate"). The Liquidation Value of the Series 5 Class E Preferred Stock shall be $1,000 per outstanding share of the Series 5 Class E Preferred Stock (the "Liquidation Value"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing December 31, 1997 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 5 Class E Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record of the Series 5 Class E Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from the date of issuance of the Series 5 Class E Preferred Stock. In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on an outstanding share of the Series 5 Class E Preferred Stock in Common Stock of the Corporation, the holder of such share shall receive that number of shares of Common Stock of the Corporation equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the average closing sale price if listed on a national securities exchange, forthe five (5) trading days immediately prior to the DividendDeclaration Date (the "Stock Dividend Price"), times (b) afraction, the numerator of which is the number of days elapsedduring the period for which the dividend is to be paid, and thedenominator of which is 365. Dividends on the Series 5 Class EPreferred Stock shall be cumulative, and no dividends or otherdistributions shall be paid or declared or set aside for payment onthe Corporation's Common Stock until all accrued and unpaiddividends on all outstanding shares of Series 5 Class E PreferredStock shall have been paid or declared and set aside for payment.
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Part 4 - Conversion. The holders of the Series 5 Class E PreferredStock shall have rights to convert the shares of Series 5 Class EPreferred Stock into shares of the Corporation's Common Stock, asfollows (the "Conversion Rights"):
4.1Right to Convert. The Series 5 Class E Preferred Stock shallbe convertible into shares of Common Stock, as follows:
4.1.1 Up to one hundred seventy-five (175) shares ofSeries 5 Class E Preferred Stock may be
convertedat the Conversion Price (as that term is defined inSection 4.2 below) at any time
on or after November3, 1997; and,
4.1.2 Up to an additional one hundred seventy-five (175) shares of Series 5 Class E Preferred Stock
may be converted at the Conversion Price at any time on or after December 3, 1997.
4.2 Conversion Price. Subject to the terms hereof, as usedherein, the term Conversion Price per outstanding share ofSeries 5 Class E Preferred Stock shall be the product of thelesser of (i) the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately preceding the date of the Conversion Notice referred to in Section 4.3 below multiplied by eighty percent (80%) or (ii) U.S. $1.6875. Notwithstanding the foregoing, the Conversion Price shall not be less than a minimum of $.75 per share ("Minimum Conversion Price"), which Minimum Conversion Price shall be eliminated from and after September 6, 1998. If any of the outstanding shares of Series 5 Class E Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 5 Class E Preferred Stock so surrendered for conversion by (b) the Conversion Price in effect at the date of the conversion. At the time of conversion of shares of the Series 5 Class E Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 5 Class E Preferred Stock so converted divided by the Stock Dividend Price, as defined in Section 3.1 hereof, in effect at the date of conversion.
4.3 Mechanics of Conversion. Any holder of the Series 5 Class E Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part 4 must surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission,
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to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). No Conversion Notice with respect to any shares of Series 5 Class E Preferred Stock can be given prior to the time such shares of Series 5 Class E Preferred Stock are eligible for conversion in accordance with the provision of Section 4.1 above, except as provided in Section 4.4. Any such premature Conversion Notice shall automatically be null and void. The Corporation shall, within seven (7) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 5 Class E Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 5 Class E Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of Series 5 Class E Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received.
4.4 Merger or Consolidation. In case of either (a) any merger orconsolidation to which the Corporation is a party(collectively, the "Merger"), other than a Merger in which theCorporation is the surviving or continuing corporation, or (b)any sale or conveyance to another corporation of all, orsubstantially all, of the assets of the Corporation(collectively, the "Sale"), and such Merger or Sale becomeseffective (x) while any shares of Series 5 Class E PreferredStock are outstanding and prior to the date that theCorporation's Registration Statement covering up to 200,000shares of Common Stock issuable upon the conversion of theSeries 5 Class E Preferred Stock is declared effective by theU. S. Securities and Exchange Commission or (y) prior to theend of the restriction periods in Section 4.1, then, in suchevent, the Corporation or such successor corporation, as thecase may be, shall make appropriate provision so that theholder of each share of Series 5 Class E Preferred Stock thenoutstanding shall have the right to convert such share ofSeries 5 Class E Preferred Stock into the kind and amount ofshares of stock or other securities and property receivableupon such Merger or Sale by a holder of the number of sharesof Common Stock into which such shares of Series 5 Class EPreferred Stock could have been converted into immediatelyprior to such Merger or Sale, subject to adjustments whichshall be as nearly equivalent as may be practicable to theadjustments provided for in this Part 4.
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4.4 Adjustments to Conversion Price for Stock Dividends and forCombinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 5 Class E Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
4.5. Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 5 Class E 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 4.4 hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 5 Class E Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 5 Class E Preferred Stock 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 5 Class E Preferred Stock immediately before that change.4.6 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 5 Class E Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof.
4.7 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 5 Class E Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.8 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 the Series 5 Class E Preferred Stock pursuant thereto; provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 5 Class E Preferred Stock in connection with such conversion.
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4.9 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 5 Class E 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 5 Class E 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 5 Class E Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
4.10 Fractional Shares. No fractional shares shall be issued uponthe conversion of any share or shares of Series 5 Class EPreferred Stock. All shares of Common Stock (includingfractions thereof) issuable upon conversion of more than oneshare of Series 5 Class E Preferred Stock by a holder thereofshall be aggregated for purposes of determining whether theconversion would result in the issuance of any fractionalshare. If, after the aforementioned aggregation, theconversion would result in the issuance of a fractional shareof Common Stock, such fractional share shall be rounded up tothe nearest whole share.
4.11Notices. Any notices required by the provisions of this Part4 to be given to the holders of shares of Series 5 Class EPreferred Stock shall be deemed given if deposited in theUnited States mail, postage prepaid, and addressed to eachholder of record at his address appearing on the books of theCorporation.
4.12 Business Day. As used herein, the term "business day" shallmean any day other than a Saturday, Sunday or a day when thefederal and state banks located in the State of New York arerequired or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, after the expiration of one (1) year from the date of the first issuance of the Series 5 Class E Preferred Stock, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, the then outstanding Series 5 Class E Preferred Stock at the following cash redemption prices per share (the "Redemption Price") if redeemed during the following periods: (a) within four (4) years from the date of the first issuance of Series 5 Class E Preferred Stock - $1,300 per share, if at any time during such four (4) year period the average of the closing bid price of the Common Stock for ten (10) consecutive trading days shall be in excess of Four U.S. Dollars ($4.00) per share, and (b) after four (4) years from the date of the first issuance of Series 5 Class E Preferred Stock - $1,000 per share.
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5.3 Mechanics of Redemption. Thirty (30) days prior to any datestipulated by the Corporation for the redemption of Series 5Class E Preferred Stock (the "Redemption Date"), writtennotice (the "Redemption Notice") shall be mailed to eachholder of record on such notice date of the Series 5 Class EPreferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 5 Class E Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 5 Class E Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 5 Class E Preferred Stock to be redeemed as provided in this Part 5.
5.4 Rights of Conversion Upon Redemption. If the redemption occurs after the first one hundred eighty (180) days after the first issuance of Series 5 Class E Preferred Stock, then, upon receipt of the Redemption Notice, any holder of Series 5 Class E Preferred Stock shall have the option, at its sole election, to specify what portion of its Series 5 Class E Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof.
5.5Surrender of Certificates. On or before the Redemption Datein respect of any Series 5 Class E Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.6 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 5 Class E Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.6 Payment. On the Redemption Date in respect of any Series 5Class E Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 5 Class E Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 5 Class E
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Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 5 Class E Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 5 Class E Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 5 Class E Preferred Stock either as to dividends
or upon liquidation, if the holders of suchclass or classes shall be entitled to thereceipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in preference or priority
to the holders of shares of this Series 5 Class E Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 5 Class E Preferred Stock, either as to
dividends or upon liquidation, whether or not the dividend rates, dividend payment dates,
or redemption or liquidation prices per share or sinking fund provisions, if any, are different
from those of this Series 5 Class E Preferred Stock, if the holders of such stock are entitled
to the receipt of dividends or of amounts distributable upon dissolution, liquidation or winding
up of the Corporation, whether voluntary or involuntary, in proportion to their respective
dividend rates or liquidation prices, without preference or priority, one over the other, as
between the holders of such stock and over the other, as between the holders of such stock
and the holders of shares of this Series 5 Class E Preferred Stock; and,
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6.2.3 Junior to shares of this Series 5 Class E Preferred Stock, either as to dividends or upon
liquidation, if such class or series shall be Common Stock or if the holders of shares of this
Series 5 Class E Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, whether voluntary
or involuntary, as the case may be, in preference or priority to the holders of shares of such
class or series.
Part 7 - Reissue.
7.1 Authorized. Any shares of Series 5 Class E Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
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CERTIFICATE OF DESIGNATIONS
OF SERIES 6 CLASS F CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), acorporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board ofDirectors by the Corporation's Restated Certificate ofIncorporation, as amended, and pursuant to the provisions ofSection 151 of the Delaware Corporation Law, the Board of Directorsof the Corporation has adopted resolutions, a copy of which isattached hereto, establishing and providing for the issuance ofaseries of Preferred Stock designated as Series 6 Class FConvertible Preferred Stock and has established and fixed thevoting powers, designations, preferences and relativeparticipating, optional and other special rights andqualifications, limitations and restrictions of such Series 6 ClassF Convertible Preferred Stock as set forth in the attachedresolutions.
Dated: November 12, 1997
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 6 CLASS F CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock,par value $.001 per share ("Preferred Stock"), which PreferredStock may be issued in one or more series by resolutions adopted bythe directors, and with the directors being entitled by resolutionto fix the number of shares in each series and to designate therights, designations, preferences and relative, participating,optional or other special rights and privileges, restrictions andconditions attaching to the shares of each such series;
WHEREAS, it is in the best interests of the Corporation forthe Board to create a new series from the Preferred Stockdesignated as the Series 6 Class F Convertible Preferred Stock, parvalue $.001 per share (the "Series 6 Class F Preferred Stock");NOW, THEREFORE, BE IT RESOLVED, that the Series 6 Class FPreferred Stock shall consist of two thousand five hundred (2,500)shares and no more and shall be designated as the Series 6 Class FConvertible Preferred Stock, and the preferences, rights,privileges, restrictions and conditions attaching to the Series 6Class F Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Part7 hereof or under the General Corporation Law of theState of Delaware (the "GCL"), the holders of the Series6 Class F Preferred Stock shall have no voting rightswhatsoever. To the extent that under Part 7 hereof orthe GCL the vote of the holders of the Series 6 Class FPreferred Stock, voting separately as a class or seriesas applicable, is required to authorize a given action ofthe Corporation, the affirmative vote or consent of theholders of at least a majority of the shares of theSeries 6 Class F Preferred Stock represented at a dulyheld meeting at which a quorum is present or by writtenconsent of a majority of the shares of Series 6 Class FPreferred Stock (except as otherwise may be requiredunder the GCL) shall constitute the approval of such action by the series. To the extent that under the GCLor Part 7 hereof, the holders of the Series 6 Class FPreferred Stock are entitled to vote on a matter, eachshare of the Series 6 Class F Preferred Stock shall beentitled one (1) vote for each outstanding share ofSeries 6 Class F Preferred Stock. Holders of the Series6 Class F Preferred Stock shall be entitled to notice of(and copies of proxy materials and other information sentto stockholders) for all shareholder meetings or
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written consents with respect to which they would be entitled tovote, which notice would be provided pursuant to theCorporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 6 Class FPreferred Stock shall not give its holders any preemptiverights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall bevoluntarily or involuntarily liquidated, dissolved orwound up at any time when any shares of the Series 6Class F Preferred Stock shall be outstanding, the holdersof the then outstanding Series 6 Class F Preferred Stockshall have a preference in distribution of theCorporation's property available for distribution to theholders of the Corporation's Common Stock equal to $1,000consideration per outstanding share of Series 6 Class FPreferred Stock, plus an amount equal to all unpaiddividends accrued thereon to the date of payment of suchdistribution ("Liquidation Preference"), whether or notdeclared by the Board.
2.2 Payment of Liquidation Preferences. Subject to the provisions of Part 6 hereof, all amounts to be paid as Liquidation Preference to the holders of Series 6 Class F Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of the Corporation's Common Stock, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to the holders of the shares of the Series 6 Class F Preferred Stock of the full Liquidation Preference amounts provided for in this Part 2, the holders of the Series 6 Class F Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 6 Class F Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 6 Class F Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 6 Class F Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 6 Class F Preferred Stock,
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ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
Part 3 - Dividends. The holders of the Series 6 Class FPreferred Stock are entitled to receive if, when and asdeclared by the Board out of funds legally availabletherefor, cumulative dividends, payable in cash or CommonStock of the Corporation, par value $.001 per share (the"Common Stock"), or any combination thereof, at theCorporation's election, at the rate of four percent (4%)per annum of the Liquidation Value (as defined below) ofeach issued and outstanding share of Series 6 Class FPreferred Stock (the "Dividend Rate"). The LiquidationValue of the Series 6 Class F Preferred Stock shall be$1,000 per outstanding share of the Series 6 Class FPreferred Stock (the "Liquidation Value"). The dividendis payable semi-annually within seven (7) business daysafter each of December 31 and June 30 of each year,commencing December 31, 1997 (each, a "DividendDeclaration Date"). Dividends shall be paid only withrespect to shares of Series 6 Class F Preferred Stockactually issued and outstanding on a Dividend DeclarationDate and to holders of record of the Series 6 Class FPreferred Stock as of the Dividend Declaration Date.Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable,except with respect to the first semi-annual dividendwhich shall accrue from September 16, 1997. In the eventthat the Corporation elects to pay the accrued dividendsdue as of a Dividend Declaration Date on an outstandingshare of the Series 6 Class F Preferred Stock in CommonStock of the Corporation, the holder of such share shallreceive that number of shares of Common Stock of theCorporation equal to the product of (a) the quotient of(i) the Dividend Rate divided by (ii) the average of theclosing bid quotation of the Corporation's Common Stockas reported on the National Association of SecuritiesDealers Automated Quotation system ("NASDAQ"), or theaverage closing sale price if listed on a nationalsecurities exchange, for the five (5) trading daysimmediately prior to the Dividend Declaration Date (the"Stock Dividend Price"), times (b) a fraction, thenumerator of which is the number of days elapsed duringthe period for which the dividend is to be paid, and thedenominator of which is 365. Dividends on the Series 6Class F Preferred Stock shall be cumulative, and nodividends or other distributions shall be paid ordeclared or set aside for payment on the Corporation'sCommon Stock until all accrued and unpaid dividends onall outstanding shares of Series 6 Class F PreferredStock shall have been paid or declared and set aside forpayment.
Part 4 - Conversion. The holders of the Series 6 ClassF Preferred Stock shall have rights to convert the shares of Series 6 Class F Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1 Right to Convert. The Series 6 Class F Preferred Stock shall be convertible into shares of Common Stock, as follows:
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4.1.1 Up to one thousand two hundred fifty (1,250)shares of Series 6 Class F Preferred Stock may
be converted at the Conversion Price (as thatterm is defined in Section 4.2 below) at anytime
on or after October 5, 1997; and,
4.1.2 Up to an additional one thousand two hundred fifty (1,250) shares of Series 6 Class F Preferred
Stock may be converted at the Conversion Price at any time on or after November 5, 1997.
4.2 Conversion Price. Subject to the terms hereof, as used herein, the Conversion Price per outstanding share of Series 6 Class F Preferred Stock shall be $1.8125, except that, in the event the average closing bid price per share of the Common Stock for 20 of any 30 consecutive trading days after March 1, 1998 shall be less than $2.50 as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, the Conversion Price shall thereafter be the product of the lesser of (i) the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five trading days immediately preceding the date of the Conversion Notice referred to in Section 4.3 below multiplied by eighty percent (80%) or (ii) $1.8125. Notwithstanding the foregoing, the Conversion Price shall not be less than a minimum of $.75 per share ("Minimum Conversion Price"), which Minimum Conversion Price shall be eliminated from and after September 6, 1998. If any of the outstanding shares of Series 6 Class F Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 6 Class F Preferred Stock so surrendered for conversion by (b) the Conversion Price as of such conversion. At the time of conversion of shares of the Series 6 Class F Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of whole shares of Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 6 Class F Preferred Stock so converted divided by the Stock Dividend Price, as defined in Part 3 hereof, in effect at the date of conversion.
4.3 Mechanics of Conversion. Any holder of the Series 6 Class F Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 6 Class F
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Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. No Conversion Notice with respect to any shares of Series 6 Class F Preferred Stock can be given prior to the time such shares of Series 6 Class F Preferred Stock are eligible for conversion in accordance with the provision of Section 4.1 above, except as provided in Section 4.4. Any such premature Conversion Notice shall automatically be null and void. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 6 Class F Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 6 Class F Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of Series 6 Class F Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion within seven (7) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.3 ("Seven (7) Business Day Period"), then, upon the written demand of RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 6 Class F Preferred Stock, for payment of the penalty described below in this Section 4.3, which demand must be received by the Corporation no later than ten (10) calendar days after the expiration of such Seven (7) Business Day Period, the Corporation shall pay to RBB Bank the following penalty for each business day after the Seven (7) Business Day Period until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion: business day eight (8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day thereafter an amount equal to the penalty due on the immediately preceding business day times two (2) until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion.
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4.4 Merger or Consolidation. In case of either (a) any merger or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the Corporation is the surviving or continuing corporation, or (b) any sale or conveyance to another corporation of all, or substantially all, of the assets of the Corporation (collectively, the "Sale"), and such Merger or Sale becomes effective (x) while any shares of Series 6 Class F Preferred Stock are outstanding and prior to the date that the Corporation's Registration Statement covering up to 1,379,500 shares of Common Stock issuable upon the conversion of the Series 6 Class F Preferred Stock is declared effective by the U. S. Securities and Exchange Commission or (y) prior to the end of the restriction periods in Section 4.1, then, in such event, the Corporation or such successor corporation, as the case may be, shall make appropriate provision so that the holder of each share of Series 6 Class F Preferred Stock then outstanding shall have the right to convert such share of Series 6 Class F Preferred Stock into the kind and amount of shares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number of shares of Common Stock into which such shares of Series 6 Class F Preferred Stock could have been converted into immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Part 4.
4.5 Adjustments to Conversion Price for Stock Dividendsand for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 6 Class F Preferred Stock are issued and outstanding shall declare or pay, without consideration any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
4.6 Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 6 Class F 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 4.4 hereof), the Conversion Price shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 6 Class F Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 6 Class F Preferred Stock would otherwise have been entitled to
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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 6 Class F Preferred Stock immediately before that change.
4.7 Common Stock Duly Issued. All Common Stock whichmay be issued upon conversion of Series 6 Class FPreferred Stock will, upon issuance, be duly issued,fully paid and nonassessable and free from all taxes,liens, and charges with respect to the issue thereof.
4.8 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 6 Class F Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.9Issue Taxes. The Corporation shall pay any and allissue and other taxes that may be payable in respect ofany issue or delivery of shares of Common Stock onconversion of the Series 6 Class F Preferred Stockpursuant thereto; provided, however, that the Corporationshall not be obligated to pay any transfer taxesresulting from any transfer requested by any holder ofSeries 6 Class F Preferred Stock in connection with suchconversion.
4.10Reservation of Stock Issuable Upon Conversion. TheCorporation shall at all times reserve and keep availableout of its authorized but unissued shares of CommonStock, solely for the purpose of effecting the conversionof the shares of the Series 6 Class F Preferred Stock,such number of its shares of Common Stock as shall, fromtime to time, be sufficient to effect the conversion ofall outstanding shares of the Series 6 Class F Preferredstock, and, if at any time, the number of authorized butunissued shares of Common Stock shall not be sufficientto effect the conversion of all then outstanding sharesof the Series 6 Class F Preferred Stock, the Corporationwill take such corporate action as may be necessary toincrease its authorized but unissued shares of CommonStock to such number of shares as shall be sufficient forsuch purposes, including, without limitation, engaging inreasonable efforts to obtain the requisite stockholderapproval of any necessary amendment to its Certificate ofIncorporation.
4.11 Fractional Shares. No fractional shares shall beissued upon the conversion of any share or shares ofSeries 6 Class F Preferred Stock. All shares of CommonStock (including fractions thereof) issuable uponconversion of more than one share of Series 6 Class FPreferred Stock by a holder thereof shall be aggregatedfor purposes of determining whether the conversion wouldresult in the issuance of any fractional share. If,after
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the aforementioned aggregation, the conversionwould result in the issuance of a fractional share ofCommon Stock, such fractional share shall be rounded upto the nearest whole share.
4.12 Notices. Any notices required by the provisions ofthis Part 4 to be given to the holders of shares ofSeries 6 Class F Preferred Stock shall be deemed given ifdeposited in the United States mail, postage prepaid, andaddressed to each holder of record at his addressappearing on the books of the Corporation.
4.13 Business Day. As used herein, the term "businessday" shall mean any day other than a Saturday, Sunday ora day when the federal and state banks located in theState of New York are required or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, after the expiration of one (1) year from June 9, 1997, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, the then outstanding Series 6 Class F Preferred Stock at the following cash redemption prices per share (the "Redemption Price") if redeemed during the following periods: (a) within four years from June 9, 1997 - $1,300 per share, if at any time during such four year period the average of the closing bid price of the Common Stock for ten consecutive trading days shall be in excess of Four Dollars ($4.00) per share, and (b) after four years from June 9, 1997 - $1,000 per share.
5.2 Mechanics of Redemption. Thirty days prior to any date stipulated by the Corporation for the redemption of Series 6 Class F Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 6 Class F Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 6 Class F Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 6 Class F Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 6 Class F Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first 180 days from the date of issuance of the Series 6 Class F Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.3 Rights of Conversion Upon Redemption. If the redemption occurs after the first 180 days after the first issuance of Series 6 Class F Preferred Stock, then, upon receipt of the Redemption Notice, any holder of
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Series 6 Class F Preferred Stock shall have the option, at its sole election, to specify what portion of its Series 6 Class F Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, such holder shall have the right to convert into Common Stock that number of Series 6 Class F Preferred Stock called for redemption in the Redemption Notice.
5.4 Surrender of Certificates. On or before the Redemption Date in respect of any Series 6 Class F Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.6 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 6 Class F Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.5 Payment. On the Redemption Date in respect of any Series 6 Class F Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 6 Class F Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 6 Class F Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
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Part 6 - Parity with Other Shares of Series 6 Class F Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividendsor return of capital in respect of Series 6 Class FPreferred Stock are not paid in full, the owners of allseries of outstanding Preferred Stock shall participaterateably in respect of accumulated dividends and returnof capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 6 Class F Preferred Stock either as to dividends or
upon liquidation, if the holders of such class or classes shall be entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in preference or priority
to the holders of shares of this Series 6 Class F Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 6 Class F Preferred Stock, either as to
dividends or upon liquidation, whether or not the dividend rates, dividend payment dates, or
redemption or liquidation prices per share or sinking fund provisions, if any, are different from
those of this Series 6 Class F Preferred Stock, if the holders of such stock are entitled to the
receipt of dividends or of amounts distributable upon dissolution, liquidation or winding up
of the Corporation, whether voluntary or involuntary, in proportion to their respective dividend
rates or liquidation prices, without preference or priority, one over the other, as between the
holders of such stock and over the other, as between the holders of such stock and the
holders of shares of this Series 6 Class F Preferred Stock; and,
6.2.3 Junior to shares of this Series 6 Class F Preferred Stock, either as to dividends or upon
liquidation, if such class or series shall be Common Stock or if the holders of shares of this
Series 6 Class F Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in preference or priority to the holders of shares
of such class or series.
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Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to theCorporation's Certificate of Incorporation (the"Articles") would alter or change the powers, preferencesor special rights of the Series 6 Class F Preferred Stockso as to affect such adversely, then the Corporation mustobtain the affirmative vote of such amendment to theArticles at a duly called and held series meeting of theholders of the Series 6 Class F Preferred Stock orwritten consent by the holders of a majority of theSeries 6 Class F Preferred Stock then outstanding.Notwithstanding the above or the provisions of the GCL,the number of authorized shares of any class or classesof stock of the Corporation may be increased or decreased(but not below the number of shares thereof outstanding)by the affirmative vote of the holders of a majority ofthe stock of the Corporation entitled to vote thereon,voting together as a single class, irrespective of theprovisions of this Section 7.1 or Section 242 of the GCL.
7.2 Authorized. Any shares of Series 6 Class FPreferred Stock acquired by the Corporation by reason ofpurchase, conversion, redemption or otherwise shall beretired and shall become authorized but unissued sharesof Preferred Stock, which may be reissued as part of anew series of Preferred Stock hereafter created.
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CERTIFICATE OF DESIGNATIONS
OF SERIES 7 CLASS G CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 7 Class G Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 7 Class G Convertible Preferred Stock as set forth in the attached resolutions.
Dated: November 12, 1997
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis F. Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 7 CLASS G CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock,par value $.001 per share ("Preferred Stock"), which PreferredStock may be issued in one or more series by resolutions adopted bythe directors, and with the directors being entitled by resolutionto fix the number of shares in each series and to designate therights, designations, preferences and relative, participating,optional or other special rights and privileges, restrictions andconditions attaching to the shares of each such series;
WHEREAS, it is in the best interests of the Corporation forthe Board to create a new series from the Preferred Stockdesignated as the Series 7 Class G Convertible Preferred Stock, parvalue $.001 per share (the "Series 7 Class G Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 7 Class GPreferred Stock shall consist of three hundred (350) shares and nomore and shall be designated as the Series 7 Class G ConvertiblePreferred Stock, and the preferences, rights, privileges,restrictions and conditions attaching to the Series 7 Class GPreferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Section 242(b)(2) of the General Corporation Law of the State of Delaware (the "GCL"), the holders of the Series 7 Class G Preferred Stock shall have no voting rights whatsoever. To the extent that under Section 242(b)(2) of the GCL the vote of the holders of the Series 7 Class G Preferred Stock, voting separately as a class or series as applicable, is required to authorize a given action of the Corporation, the affirmative vote or consent of the holders of at least a majority of the shares of the Series 7 Class G Preferred Stock represented at a duly held meeting at which a quorum is present or by written consent of a majority of the shares of Series 7 Class G Preferred Stock (except as otherwise may be required under the GCL) shall constitute the approval of such action by the series. To the extent that under Section 242(b)(2) of the GCL the holders of the Series 7 Class G Preferred Stock are entitled to vote on a matter, each share of the Series 7 Class G Preferred Stock shall be entitled one (1) vote for each outstanding share of Series 7 Class G Preferred Stock. Holders of the Series 7 Class G Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes. If the holders of the Series 7 Class G Preferred Stock are required to vote under Section 242(b)(2) of the GCL as a result of the number of authorized shares of any such class or classes of stock being increased or decreased, the number of authorized shares of any of such class or classes of stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, irrespective of the provisions of Section 242(b)(2) of the GCL.
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1.2 No Preemptive Rights. The Series 7 Class G Preferred Stockshall not give its holders any preemptive rights to acquire anyother securities issued by the Corporation at any time in thefuture.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily orinvoluntarily liquidated, dissolved or wound up at any time whenany shares of the Series 7 Class G Preferred Stock shall beoutstanding, the holders of the then outstanding Series 7 Class GPreferred Stock shall be entitled to receive out of the assets ofthe Corporation available for distribution to shareholders anamount equal to $1,000 consideration per outstanding share ofSeries 7 Class G Preferred Stock, and no more, plus an amount equalto all unpaid dividends accrued thereon to the date of payment ofsuch distribution ("Liquidation Preference"), whether or notdeclared by the Board of Directors, before any payment shall bemade or any assets distributed to the holders of the Corporation'sCommon Stock.
2.2 Payment of Liquidation Preferences. Subject to the provisionsof Part 6 hereof, all amounts to be paid as Liquidation Preferenceto the holders of Series 7 Class G Preferred Stock, as provided inthis Part 2, shall be paid or set apart for payment before thepayment or setting apart for payment of any amount for, or thedistribution of any of the Corporation's property to the holders ofthe Corporation's Common Stock, whether now or hereafterauthorized, in connection with such liquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to the holders ofthe shares of the Series 7 Class G Preferred Stock of the fullLiquidation Preference amounts provided for in this Part 2, theholders of the Series 7 Class G Preferred Stock as such shall haveno right or claim to any of the remaining assets of theCorporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. Inthe event that the assets of the Corporation available fordistribution to the holders of shares of the Series 7 Class GPreferred Stock upon any dissolution, liquidation or winding up ofthe Corporation, whether voluntary or involuntary, shall beinsufficient to pay in full all amounts to which such holders areentitled pursuant to this Part 2, no such distribution shall bemade on account of any shares of any other class or series ofPreferred Stock ranking on a parity with the shares of this Series7 Class G Preferred Stock upon such dissolution, liquidation orwinding up unless proportionate distributive amounts shall be paidon account of the shares of this Series 7 Class G Preferred Stockand shares of such other class or series ranking on a parity withthe shares of this Series 7 Class G Preferred Stock, ratably, inproportion to the full distributable amounts for which holders ofall such parity shares are respectively entitled upon suchdissolution, liquidation or winding up.
Part 3 - Dividends.
3.1 The holders of the Series 7 Class G Preferred Stock are entitled to receive if, when and as declared by the Board of Directors of the Corporation (the "Board") out of funds legally available therefor, cumulative annual
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dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), or any combination thereof, at the Corporation's election, at the rate of four percent (4%) per annum of the Liquidation Value (as defined below) of each issued and outstanding share of Series 7 Class G Preferred Stock (the "Dividend Rate"). The Liquidation Value of the Series 7 Class G Preferred Stock shall be $1,000 per outstanding share of the Series 7 Class G Preferred Stock (the "Liquidation Value"). The dividend is payable semi-annually within seven (7) business days after each of December 31and June 30 of each year, commencing December 31, 1997 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 7 Class G Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record of the Series 7 Class G Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from the date of issuance of the Series 7 Class G Preferred Stock. In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on an outstanding share of the Series 7 Class G Preferred Stock in Common Stock of the Corporation, the holder of such share shall receive that number of shares of Common Stock of the Corporation equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the average closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid, and the denominator of which is 365. Dividends on the Series 7 Class G Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 7 Class G Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 7 Class G Preferred Stock shall have rights to convert the shares of Series 7 Class G Preferred Stock into shares of the Corporation's Common Stock, as follows (the "Conversion Rights"):
4.1 Right to Convert. The Series 7 Class G Preferred Stock shallbe convertible into shares of Common Stock, as follows:
4.1.1 Up to one hundred seventy-five (175) shares ofSeries 7 Class G Preferred Stock may be convertedat the Conversion Price (as that term is defined inSection 4.2 below) at any time on or after November3, 1997; and,
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4.1.2 Up to an additional one hundred seventy-five (175)shares of Series 7 Class G Preferred Stock may beconverted at the Conversion Price at any time on orafter December 3, 1997.
4.2 Conversion Price. Subject to the terms hereof, as usedherein, the Conversion Price per outstanding share of Series7 Class G Preferred Stock shall be $1.8125 except that, in theevent the average closing bid price per share of the CommonStock for 20 of any 30 consecutive trading days (a "30 DayPeriod") after March 1, 1998 shall be less than $2.50 asreported on the over-the-counter market, or the closing saleprice if listed on a national securities exchange and if theholders of the Series 7 Class G Preferred Stock have engagedin no sales of Common Stock of the Company during, and for 30trading days prior to, the applicable 30 Day Period, theConversion Price shall thereafter be the product of the lesserof (i) the average closing bid quotation of the Common Stockas reported on the over-the-counter market, or the closingsale price if listed on a national securities exchange, forthe five trading days immediately preceding the date of theConversion Notice referred to in Section 4.3 below multipliedby eighty percent (80%) or (ii) $1.8125. Notwithstanding theforegoing, the Conversion Price shall not be less than aminimum of $.75 per share ("Minimum Conversion Price"), whichMinimum Conversion Price shall be eliminated from and afterSeptember 6, 1998. If any of the outstanding shares of Series7 Class G Preferred Stock are converted, in whole or in part,into Common Stock pursuant to the terms of this Part 4, thenumber of shares of whole Common Stock to be issued to theholder as a result of such conversion shall be determined bydividing (a) the aggregate Liquidation Value of the Series 7Class G Preferred Stock so surrendered for conversion by (b)the Conversion Price as of such conversion. At the time ofconversion of shares of the Series 7 Class G Preferred Stock,the Corporation shall pay in cash to the holder thereof anamount equal to all unpaid and accrued dividends, if any,accrued thereon to the date of conversion, or, at theCorporation's option, in lieu of paying cash for the accruedand unpaid dividends, issue that number of whole shares ofCommon Stock which is equal to the quotient of the amount ofsuch unpaid and accrued dividends to the date of conversion onthe shares of Series 7 Class G Preferred Stock so converteddivided by the Stock Dividend Price, as defined in Part 3 hereof, in effect at the date of conversion.
4.5Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 7 Class G 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 4.4 hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 7 Class G Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 7 Class G Preferred Stock 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 7 Class G Preferred Stock immediately before that change.
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4.6 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 7 Class G Preferred Stockwill, upon issuance, be duly issued, fully paid andnonassessable and free from all taxes, liens, and charges withrespect to the issue thereof.
4.7 Notice of Adjustments. Upon the occurrence of each adjustmentor readjustment of any Conversion Price pursuant to this Part4, the Corporation, at its expense, within a reasonable periodof time, shall compute such adjustment or readjustment inaccordance with the terms hereof and prepare and furnish toeach holder of Series 7 Class G Preferred Stock a noticesetting forth such adjustment or readjustment and showing indetail the facts upon which such adjustment is based.
4.8 Issue Taxes. The Corporation shall pay any and all issue andother taxes that may be payable in respect of any issue ordelivery of shares of Common Stock on conversion of the Series7 Class G Preferred Stock pursuant thereto; provided, however,that the Corporation shall not be obligated to pay anytransfer taxes resulting from any transfer requested by anyholder of Series 7 Class G Preferred Stock in connection withsuch conversion.
4.9 Reservation of Stock Issuable Upon Conversion. TheCorporation shall at all times reserve and keep available outof its authorized but unissued shares of Common Stock, solelyfor the purpose of effecting the conversion of the shares ofthe Series 7 Class G Preferred Stock, such number of itsshares of Common Stock as shall, from time to time, besufficient to effect the conversion of all outstanding sharesof the Series 7 Class G Preferred stock, and, if at any time,the number of authorized but unissued shares of Common Stockshall not be sufficient to effect the conversion of all thenoutstanding shares of the Series 7 Class G Preferred Stock,the Corporation will take such corporate action as may benecessary to increase its authorized but unissued shares ofCommon Stock to such number of shares as shall be sufficientfor such purposes, including, without limitation, engaging inreasonable efforts to obtain the requisite stockholderapproval of any necessary amendment to its Certificate ofIncorporation.
4.10 Fractional Shares. No fractional shares shall be issued uponthe conversion of any share or shares of Series 7 Class GPreferred Stock. All shares of Common Stock (includingfractions thereof) issuable upon conversion of more than oneshare of Series 7 Class G Preferred Stock by a holder thereofshall be aggregated for purposes of determining whether theconversion would result in the issuance of any fractionalshare. If, after the aforementioned aggregation, theconversion would result in the issuance of a fractional shareof Common Stock, such fractional share shall be rounded up tothe nearest whole share.
4.11 Notices. Any notices required by the provisions of this Part4 to be given to the holders of shares of Series 7 Class GPreferred Stock shall be deemed given if deposited in the United States mail, postageprepaid, and addressed to eachholder of record at his address appearing on the books of theCorporation.
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4.12 Business Day. As used herein, the term "business day" shallmean any day other than a Saturday, Sunday or a day when thefederal and state banks located in the State of New York arerequired or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwiseprovided in this Section 5.1, at any time, and from time totime, after the expiration of one (1) year from the date ofthe first issuance of the Series 7 Class G Preferred Stock,the Corporation may, at its sole option, but shall not beobligated to, redeem, in whole or in part, at any time, andfrom time to time, the then outstanding Series 7 Class GPreferred Stock at the following cash redemption prices pershare (the "Redemption Price") if redeemed during thefollowing periods: (a) within four (4) years from the date ofthe first issuance of Series 7 Class G Preferred Stock - -$1,300 per share, if at any time during such four (4) yearperiod the average of the closing bid price of the CommonStock for ten (10) consecutive trading days shall be in excessof Four U.S. Dollars ($4.00) per share, and (b) after four (4)years from the date of the first issuance of Series 7 Class GPreferred Stock - $1,000 per share.
5.3 Mechanics of Redemption. Thirty (30) days prior to any datestipulated by the Corporation for the redemption of Series 7Class G Preferred Stock (the "Redemption Date"), writtennotice (the "Redemption Notice") shall be mailed to eachholder of record on such notice date of the Series 7 Class GPreferred Stock. The Redemption Notice shall state: (i) theRedemption Date of such shares, (ii) the number of Series 7Class G Preferred Stock to be redeemed from the holder to whomthe Redemption Notice is addressed, (iii) instructions forsurrender to the Corporation, in the manner and at the placedesignated, of a share certificate or share certificatesrepresenting the number of Series 7 Class G Preferred Stock tobe redeemed from such holder, and (iv) instructions as to howto specify to the Corporation the number of Series 7 Class GPreferred Stock to be redeemed as provided in this Part 5.
5.4 Rights of Conversion Upon Redemption. If the redemptionoccurs after the first one hundred eighty (180) days after thefirst issuance of Series 7 Class G Preferred Stock, then, uponreceipt of the Redemption Notice, any holder of Series 7 ClassG Preferred Stock shall have the option, at its sole election,to specify what portion of its Series 7 Class G PreferredStock called for redemption in the Redemption Notice shall beredeemed as provided in this Part 5 or converted into CommonStock in the manner provided in Part 4 hereof, except that,notwithstanding any provision of such Part 4 to the contrary,
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such holder shall have the right to convert into Common Stockthat number of Series 7 Class G Preferred Stock called forredemption in the Redemption Notice.
5.5 Surrender of Certificates. On or before the Redemption Datein respect of any Series 7 Class G Preferred Stock, eachholder of such shares shall surrender the required certificateor certificates representing such shares to the Corporation inthe manner and at the place designated in the RedemptionNotice, and upon the Redemption Date, the Redemption Price forsuch shares shall be made payable, in the manner provided inSection 5.6 hereof, to the order of the person whose nameappears on such certificate or certificates as the ownerthereof. If a share certificate is surrendered and all theshares evidenced thereby are not being redeemed (as describedbelow), the Corporation shall cause the Series 7 Class GPreferred Stock which are not being redeemed to be registeredin the names of the persons or entity whose names appear asthe owners on the respective surrendered share certificatesand deliver such certificate to such person.
5.6 Payment. On the Redemption Date in respect of any Series 7Class G Preferred Stock or prior thereto, the Corporationshall deposit with any bank or trust company having a capitaland surplus of at least U. S. $50,000,000, as a trust fund, asum equal to the aggregate Redemption Price of all such sharescalled from redemption (less the aggregate Redemption Pricefor those Series 7 Class G Preferred Stock in respect of whichthe Corporation has received notice from the holder thereof ofits election to convert Series 7 Class G Preferred Stock intoCommon Stock), with irrevocable instructions and authority tothe bank or trust company to pay, on or after the RedemptionDate, the Redemption Price to the respective holders upon thesurrender of their share certificates. The deposit shallconstitute full payment for the shares to their holders, andfrom and after the date of the deposit the redeemed sharesshall be deemed to be no longer outstanding, and holdersthereof shall cease to be shareholders with respect to suchshares and shall have no rights with respect thereto exceptthe rights to receive from the bank or trust company paymentsof the Redemption Price of the shares, without interest, uponsurrender of their certificates thereof. Any funds sodeposited and unclaimed at the end of one year following theRedemption Date shall be released or repaid to theCorporation, after which the former holders of shares calledfor redemption shall be entitled to receive payment of theRedemption Price in respect of their shares only from theCorporation.
Part 6 - Parity with Other Shares of Series 7 Class G Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or returnof capital in respect of Series 7 Class G Preferred Stock arenot paid in full, the owners of all series of outstandingPreferred Stock shall participate rateably in respect ofaccumulated dividends and return of capital.
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6.2 Ranking. For purposes of this resolution, any stock of anyclass or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 7Class G Preferred Stock either as to dividends
or upon liquidation, if the holders of suchclass or classes shall be entitled to thereceipt of
dividends or of amountsdistributable upon dissolution, liquidation orwinding up of the
Corporation, whethervoluntary or involuntary, as the case may be,in preference or
priority to the holders ofshares of this Series 7 Class G PreferredStock;
6.2.2 On a parity with, or equal to, shares of thisSeries 7 Class G Preferred Stock, either as to
dividends or upon liquidation, whether or notthe dividend rates, dividend payment dates,
orredemption or liquidation prices per share orsinking fund provisions, if any, are
differentfrom those of this Series 7 Class G PreferredStock, if the holders of such
stock areentitled to the receipt of dividends or ofamounts distributable upon
dissolution,liquidation or winding up of the Corporation,whether voluntary or
involuntary, inproportion to their respective dividend ratesor liquidation prices,
without preference orpriority, one over the other, as between theholders of such
stock and over the other, asbetween the holders of such stock and theholders of
shares of this Series 7 Class GPreferred Stock; and,
6.2.3 Junior to shares of this Series 7 Class GPreferred Stock, either as to dividends orupon
liquidation, if such class or seriesshall be Common Stock or if the holders ofshares of this
Series 7 Class G Preferred tock shall be entitled to receipt ofdividends or of amounts
distributable upondissolution, liquidation or winding up of theCorporation, whether
voluntary or involuntary,as the case may be, in preference or priorityto the holders of
shares of such class orseries.
Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to the Corporation'sCertificate of Incorporation (the "Articles") would alteror change the powers, preferences or special rights of theSeries 7 Class G Preferred Stock so as to affect suchadversely, then the Corporation must obtain the affirmativevote of such amendment to the Articles at a duly called andheld series meeting of the holders of the Series 7 Class GPreferred Stock then outstanding. Notwithstanding the aboveor the provisions of the GCL, the number of authorized sharesof any class or classes of stock of the Corporation may beincreased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority
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of the stock of the Corporation entitled tovote thereon, voting together as a single class, irrespectiveof the provisions of this Section 7.1 or Section 242 of theGCL.
7.2 Authorized. Any shares of Series 7 Class G PreferredStock acquired by the Corporation by reason of purchase,conversion, redemption or otherwise shall be retired andshall become authorized but unissued shares of PreferredStock, which may be reissued as part of a new series ofPreferred Stock hereafter created.
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STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 10:00 A.M. 11/26/1997
971405163 -- 2249849
CERTIFICATE OF ELIMINATION
OF
SERIES 4 CLASS D CONVERTIBLE PREFERRED STOCK
AND
SERIES 5 CLASS E CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
____________________________________________
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporationorganized and existing under the General Corporation Law of theState of Delaware (hereinafter called the "Corporation"), herebycertifies the following:
1. That the Certificate of Designations of Series 4 Class DConvertible Preferred Stock of the Corporation (the "Series 4Preferred") was filed on June 11, 1997 (the "Series 4 Certificateof Designations").
2. That all outstanding shares of the Series 4 Preferredhave been delivered to the Company and exchanged upon agreementwith the holder thereof pursuant to the terms and conditions of acertain Exchange Agreement between the Company and RBB BankAktiengesellschaft, dated effective as of September 16, 1997.
3. That no shares of Series 4 Preferred remain outstanding.
4. That all shares of the Series 4 Preferred which have beenexchanged have the status of authorized and unissued shares of thePreferred Stock of the Corporation without designation as toseries, until such shares are once more designated as part of aparticular series by the Board of Directors.
5. That effective September 16, 1997, the Board of Directorsof the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchangewith the holder
of the Series 4 Class DConvertible Preferred Stock, no authorized
shares of Series 4 Class D ConvertiblePreferred Stock will remain
outstanding and no shares of Series 4 Class D ConvertiblePreferred
Stock will be issued subject to theCertificate of Designations previously
filedwith respect to the Series 4 Class DConvertible Preferred Stock.
FURTHER RESOLVED, that upon completion of theexchange, the
officers of the Company arehereby authorized and directed, for and on
behalf of the Company, to execute and deliveran appropriate Certificate
of Elimination tothe Secretary of State of Delaware regarding
the Series 4 Class D Convertible PreferredStock.
6. That the Certificate of Designations of the Series 5Class E Convertible Preferred Stock of the Corporation (the "Series5 Preferred") was filed on July 14, 1997 (the "Series 5 Certificateof Designations").
7. That all outstanding shares of the Series 5 Preferredhave been delivered to the Company and exchanged upon agreementwith the holder thereof pursuant to the terms and conditions of acertain Exchange Agreement between the Company and The InfinityFund, L.P., dated effective as of September 16, 1997.
8. That no shares of Series 5 Preferred remain outstanding.
9. That all shares of the Series 5 Preferred which have beenexchanged have the status of authorized and unissued shares of thePreferred Stock of the Corporation without designation as toseries, until such shares are once more designated as part of aparticular series by the Board of Directors.
10. That effective September 16, 1997, the Board of Directorsof the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchangewith the holder
of the Series 5 Class EConvertible Preferred Stock, no authorized
shares of Series 5 Class E ConvertiblePreferred Stock will remain
outstanding and noshares of Series 5 Class E ConvertiblePreferred
Stock will be issued subject to theCertificate of Designations previously
filedwith respect to the Series 5 Class EConvertible Preferred Stock.
FURTHER RESOLVED, that upon completion of theexchange, the
officers of the Company arehereby authorized and directed, for and on
behalf of the Company, to execute and deliveran appropriate Certificate
of Elimination tothe Secretary of State of Delaware regardingthe Series
5 Class E Convertible PreferredStock.
11. That pursuant to the provisions of Section 151(g) of theDelaware General Corporation Law, upon the effective date of thefiling of this Certificate, this Certificate will have the effectof eliminating from the Restated Certificate of Incorporation onlythose matters set forth in the Restated Certificate ofIncorporation with respect to the Series 4 Class D ConvertiblePreferred Stock and the Series 5 Class E Convertible PreferredStock.
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IN WITNESS WHEREOF, this Certificate of Elimination has beenexecuted this 20th day of November, 1997, by the President of theCompany.
PERMA-FIX ENVIRONMENTAL
ATTEST: SERVICES, INC.
/s/ Richard T. Kelecy By /s/ Louis Centofanti
Richard T. Kelecy, Secretary Dr. Louis F. Centofanti,
President
(SEAL)
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STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:00 PM 07/10/1998
981268436 -- 2249849
CERTIFICATE OF DESIGNATIONS
OF RIGHTS AND PREFERENCES OF THE
SERIES 10 CLASS J CONVERTIBLE PREFERRED STOCK OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
We, being respectively the President and Secretary of Perma-FixEnvironmental Services, Inc. a corporation organized and existingunder the laws of the State of Delaware (hereinafter the"Corporation"), DO HEREBY CERTIFY:
FIRST:
That pursuant to authority expressly granted and vested in theBoard of Directors of said Corporation under Section 151 of theDelaware General Corporation Law (the "GCL"), and the provisions ofthe Corporation's Restated Certificate of Incorporation, said Boardof Directors, on June 30th, 1998 (the "Closing Date"), adopted thefollowing resolution setting forth the designations, powers,preferences and rights of its Series 10 Class J ConvertiblePreferred Stock (the "Certificate of Designations").
RESOLVED: That the designations, powers, preferences and rights ofthe Series 10 Class J Convertible Preferred Stock be, and theyhereby are, as set forth below:
1. Number of Shares of Common Stock of Series 10 Class JConvertible Preferred Stock
The Corporation hereby authorizes the issuance of up to 3,000(three thousand,) shares of Series 10 Class J Convertible PreferredStock par value $.001 per share (the "Preferred Stock"). ThisPreferred Stock shall pay an annual dividend based on a 365 daycalendar year of 4% of the Liquidation Value (as defined in Section3 hereof) ("Dividend Rate"), payable semiannually within ten (10)business days after each subsequent June 30th and December 31st(each a "Dividend Declaration Date"), and shall be payable in cashor shares of the Corporation's par value $.001 per share commonstock (Common Stock) at the Corporation's option. The firstDividend Declaration Date shall be December 31st, 1998.
In the event that the Corporation elects to pay the accrueddividends due as of a Dividend Declaration Date on the outstandingshares of Preferred Stock in Common Stock of the Corporation, theHolder of each share of Preferred Stock shall receive that numberof shares of Common Stock equal to the product of (a) the quotientof (i) the Dividend Rate divided by (ii) the average of' theclosing bid quotation of the Corporation's Common Stock as reportedon the National Association of Securities Dealers AutomatedQuotation system ("NASDAQ"), or if the Common Stock is not listed for trading on a national
;1
securities exchange, the average closing bid price of the CommonStock as quoted on such national exchange, for the five (5) tradingdays immediately prior to the Dividend Declaration Date (the "StockDividend Price"), times (b) a fraction, the numerator of which isthe number of days elapsed during the period for which the dividendis to be paid, and the denominator of which is 365. Dividends onthe Preferred Stock shall be cumulative, and no dividends or otherdistributions shall be paid or declared or set aside for payment onthe Corporation's Common Stock until all accrued and unpaiddividends on all outstanding shares of Preferred Stock shall havebeen paid or declared and set aside for payment.
2. Voting.
(a) Except as provided under Section 242 of the GCL, holders ofPreferred Stock (the "Holders") shall not have the right to voteon any matter. Notwithstanding the provisions of Section 242 ofthe GCL or Section 4 hereof, the number of authorized shares of anyclass or classes of stock of the Corporation may be increased ordecreased (but not below the number of shares thereof outstanding)by the affirmative vote of the holders of a majority of the stockof the Corporation entitled to vote thereon, voting together as asingle class, irrespective of the provisions of Section 242 of theGCL.
3. Liquidation.
In the event of a voluntary or involuntary dissolution,liquidation, or winding up of the Corporation, the Holders ofPreferred Stock shall be entitled to receive out of the assets ofthe Corporation legally available for distribution to holders ofits capital stock, before any payment or distribution shall be madeto holders of shares of Common Stock or any other class of stockranking junior to the Preferred Stock, an amount per share ofPreferred Stock equal to $1,000 (the "Liquidation Value") plus anyaccrued and unpaid dividends on the Preferred Stock. If upon suchliquidation, dissolution, or winding up of the Corporation, whethervoluntary or involuntary, the assets to be distributed among theHolders of Preferred Stock shall be insufficient to permit paymentto the Holders of Preferred Stock of the amount distributable asaforesaid, then the entire assets of the Corporation to be sodistributed shall be distributed ratably among the Holders ofPreferred Stock and shares of such other classes or series rankingon a parity with the shares of this Preferred Stock in proportionto the full distributable amounts for which holders of all suchparity shares are entitled upon such distribution, liquidation, orwinding up. Upon any such liquidation, dissolution or winding upof the Corporation, after the Holders of Preferred Stock shallhave been paid in full the amounts to which they shall be entitled,the remaining net assets of the Corporation may be distributed tothe holders of stock ranking on liquidation junior to the PreferredStock and the Holders of the Preferred Stock shall have no right orclaim to any of the remaining assets of the Corporation. Writtennotice of such liquidation, dissolution or winding up, stating apayment date, the amount of the liquidation payments and the place
;2
where said liquidation payments shall be payable, shall be given bymail, postage prepaid or by telex or facsimile to non-U.S.residents, not less than 10 days prior to the payment date statedtherein, to the Holders of record of Preferred Stock, such noticeto be addressed to each such Holder at its address as shown by therecords of the Corporation. For purposes hereof the shares ofCommon Stock, shall rank on liquidation junior to the PreferredStock.
4. Restrictions.
The Corporation will not amend or modify the terms of its RestatedCertificate of Incorporation so as to adversely alter or change thePreferred Stock at any time when shares of Preferred Stock areoutstanding, without the approval of the Holders of at least amajority of the then outstanding shares of Preferred Stock given inwriting or by vote at a meeting, consenting or voting (as the casemay be) separately as a series, except where the vote or writtenconsent of the Holders of a greater number of shares of CommonStock of the Corporation is required by law or by the Corporation'sCertificate of Incorporation, as amended.
5. Optional Conversion.
The Holders of shares of Preferred Stock shall have the followingconversion rights to convert the shares of Preferred Stock intoshares of Common Stock of the Corporation:
(a) Conversion Dates, The Holder of any share or shares ofPreferred Stock may convert cumulatively any of such PreferredStock at any time subsequent to 180 days after the Closing Date.
(b) Right to Convert; Conversion Price. Subject to the termshereof, as used herein, the term Conversion Price per outstandingshare of Preferred Stock shall be One Dollar and 875/1000 ($1.875);except that after the expiration of one hundred and eighty (180)days after the Closing Date if the average of the closing bid priceper share of Common Stock quoted on the NASDAQ (or the closing bidprice of the Common Stock as quoted on the national securitiesexchange if the Common Stock is not listed for trading on theNASDAQ but is listed for trading on a national securities exchange)for the five (5) trading days immediately prior to the particulardate of each Conversion Notice (as defined below) is less than TwoDollars and 34/100 ($2.34), then the Conversion Price for thatparticular conversion shall be eighty percent (80%) of the averageof the closing bid price of the Common Stock on the NASDAQ (or ifthe Common Stock is not listed for trading on the NASDAQ but islisted for trading on a national securities exchange then eightypercent (80%) of the average of the closing bid price of the CommonStock on the national securities exchange) for the five (5) tradingdays immediately prior to the particular date of the ConversionNotice. If any of the outstanding shares of Preferred Stock areconverted, in whole or in part, into Common Stock pursuant to theterms of this Section 5(b), the number of shares of whole CommonStock to be issued to the Holder as a result of such conversion shall be determined
;3
by dividing (a) the aggregate Stated Value ofthe Preferred Stock so surrendered for conversion by (b) theConversion Price in effect on the date of that particularConversion Notice relating to such conversion. At the time ofconversion of shares of the Preferred Stock, the Corporation shallpay in cash to the holder thereof an amount equal to all unpaid andaccrued dividends, if any, accrued thereon on the shares ofPreferred so converted to the date of the Conversion Noticerelating to such conversion, or, at the Corporation's option, inlieu of paying cash for the accrued and unpaid dividends, issuethat number of shares of whole Common Stock which is equal to thequotient of the amount of such unpaid and accrued dividends to thedate of the Conversion Notice relating to such conversion of theshares of Preferred Stock so converted divided by the StockDividend Price, in effect at the date of the Conversion Noticerelating to such conversion.
(c) Conversion Notice. The right of conversion shall be exercisedby the Holder thereof by telecopying or faxing an executed andcompleted written notice signed by an authorized representative ofthe Holder, ("Conversion Notice") to the Corporation that theHolder elects to convert a specified number of shares of PreferredStock representing a specified Stated Value thereof into shares ofCommon Stock and by delivering by express courier the certificateor certificates of Preferred Stock being converted to theCorporation at its principal office (or such other office or agencyof the Corporation as the Corporation may designate by notice inwriting to the Holders of the Preferred Stock). The business dateindicated on a Conversion Notice which is telecopied to andreceived by the Corporation in accordance with the provisionshereof shall be deemed a Conversion Date. The Conversion Noticeshall include therein the Stated Value of shares of Preferred Stockto be converted, and a calculation (a) of the Stock Dividend Price,(b) the Conversion Price, and (c) the number of Shares of CommonStock to be issued in connection with such conversion. TheCorporation shall have the right to review the calculationsincluded in the Conversion Notice, and shall provide notice of anydiscrepancy or dispute therewith within three (3) business days ofthe receipt thereof. The Holder shall deliver to the Corporationan original Conversion Notice and the original Preferred to beconverted within three (3) business days from the date of theConversion Notice.
(d) Issuance of Certificates - Time Conversion Effected. Promptly, but in no event more than six (6) business days, afterthe receipt by facsimile of the Conversion Notice referred to inSubparagraph (5)(c); and provided within the six (6) business daysthe Corporation receives the certificate or certificates for theshares of Preferred Stock to be converted, the Corporation shallissue and deliver, or cause to be issued and delivered, to theHolder, registered in the name of the Holder, a certificate orcertificates for the number of whole shares of Common Stock intowhich such shares of Preferred Stock are converted. Suchconversion shall be deemed to have been effected as of the close ofbusiness on the date on which the telecopy or facsimile ConversionNotice shall have been received by the Corporation, and the rightsof the Holder of such share or shares of Preferred Stock shallcease, at such time, and the Holder or Holders shall be deemed tohave become the Holder or Holders of record of the shares of CommonStock represented thereby.
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In the event that the shares of Common Stock issuable uponconversion of the Preferred, is not delivered within six (6)business days of the date the Company receives the ConversionNotice, the Company shall pay to the Buyer, by wire transfer, asliquidated damages for such failure and not as a penalty, for each$100,000 of Preferred sought to be converted, $500 for each of thefirst five (5) calendar days and $1,000 per calendar day thereafterthat the shares of Common Stock are not delivered, which liquidateddamages shall begin to run from the seventh (7th) business dayafter the Conversion Date. Any and all payments required pursuantto this paragraph shall be payable only in cash. Notwithstandingthe above, liquidated damages shall not exceed $2,000.00 per day. In addition to the liquidated damages set forth herein, in theevent the Company fails to deliver the shares of Common Stockwithin six (6) business days after the Conversion date, the Companyagrees to issue the larger number of shares of Common Stock derivedfrom (i) the original Conversion Notice, or (ii) utilizing the fivelowest closing bid prices of the Company's shares of Common Stockbeginning on the Conversion Date and ending on the day the sharesof Common Stock are delivered. The Company understands that adelay in the issuance of the shares of Common Stock could result ineconomic loss to the Holder. Nothing contained herein, or in thePreferred shall limit the Holder's rights to pursue actual damagesfor the Company's failure to issue and deliver shares of CommonStock to the Holder in accordance with the terms of the Certificateof Designations, and this Agreement.
(e) Fractional Shares of Common Stock. No fractional shares ofCommon Stock shall be issued upon conversion of any Preferred Stockinto shares of Common Stock. All fractional shares of Common Stockshall be aggregated and then rounded down to the nearest wholeshare of Common Stock. In case the number of shares of PreferredStock represented by the certificate or certificates surrenderedpursuant to Subparagraph 5(b) exceeds the number of shares ofCommon Stock converted, the Corporation shall, upon suchconversion, execute and deliver to the Holder, at the expense ofthe Corporation, a new certificate or certificates for the numberof shares of Preferred Stock represented by the certificate orcertificates surrendered which are not to be converted.
(f) Merger or Consolidation. In case of either (a) any merger orconsolidation to which the Corporation is a party (collectively,the "Merger"), other than a Merger in which the Corporation is thesurviving or continuing corporation, or (b) any sale or conveyanceto another corporation of all, or substantially all, of the assetsof the Corporation (collectively, the "Sale"), and such Merger orSale becomes effective (x) while any shares of Preferred Stock areoutstanding and prior to the date that the Corporation'sRegistration Statement covering all the shares of Common Stockissuable upon the conversion of the Preferred Stock is declaredeffective by the U.S. Securities and Exchange Commission("Commission"), the Corporation or such successor corporation asthe case may be, shall make appropriate provision so that theHolder of each share of Preferred Stock then outstanding shall havethe right to convert such share of Preferred Stock into the kindand amount of shares of stock or other securities and propertyreceivable upon such Merger or Sale by a holder of the number ofshares of Common Stock into which such shares of Preferred Stockcould have been converted into immediately prior to such Merger or
;5
Sale, subject to adjustments which shall be as nearly equivalent asmay be practicable to the adjustments provided for in this Section5.
In the event of a Merger or Sale, where the Corporation is not thesurviving Corporation, the Holder shall have the right to redeemall of the outstanding shares of Preferred Stock at 120% of theLiquidation Value of each share of Preferred Stock then outstandingplus all accrued and unpaid dividends (the "Redemption Amount").The Corporation shall pay this Redemption Amount in cash within ten(10) business days of receipt by the Corporation of notice from theHolder, and receipt by the Corporation of all outstanding shares ofPreferred Stock duly endorsed by the Holder to the Corporation.
(g) Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporationat any time or from time to time while shares of Preferred Stockare issued and outstanding shall declare or pay, any dividend onthe Common Stock payable in Common Stock, or shall effect asubdivision of the outstanding shares of Common Stock into agreater number of shares of Common Stock (by stock split,reclassification or otherwise than by payment of a dividend inCommon Stock), or if the outstanding shares of Common Stock shallbe combined or consolidated, by reclassification or otherwise, intoa lesser number of shares of Common Stock, then the ConversionPrice in effect immediately before such event shall, concurrentlywith the effectiveness of such event, be proportionately decreasedor increased, as appropriate.
(h) Adjustments for Reclassification and Reorganization. Ifthe Common Stock issuable upon conversion of the Preferred Stockshall be changed into the same or a different number of shares ofCommon Stock of any other class or classes of stock, whether bycapital reorganization, reclassification or otherwise (other thana subdivision or combination or shares of Common Stock provided forin Section 5(g) hereof), the Conversion Price then in effect shall,concurrently with the effectiveness of such reorganization orreclassification, be proportionately adjusted so that the PreferredStock shall be convertible into, in lieu of the number of shares ofCommon Stock which the holders of Preferred Stock would otherwisehave been entitled to receive, a number of shares of Common Stockof such other class or classes of stock equivalent to the number ofshares of Common Stock that would have been subject to receipt bythe holders upon conversion of the Preferred Stock immediatelybefore that change.
6. Assignment.
Subject to all applicable restrictions on transfer, the rightsand obligations of the Corporation and the Holder of thePreferred Stock shall be binding upon and benefit the successors,assigns, heirs, administrators, and transferees of the parties.
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7. Shares of Common Stock to be Reserved.
The Corporation, upon the effective date of this Certificate ofDesignations, has a sufficient number of shares of Common Stockavailable to reserve for issuance upon the conversion of alloutstanding shares of Preferred Stock, pursuant to the terms andconditions set forth in Section 5, and exercise of the Warrants asdefined in Section 11. The Corporation will at all times reserveand keep available out of its authorized shares of Common Stock,solely for the purpose of issuance upon the conversion of PreferredStock, and exercise of the Warrants, as herein provided, suchnumber of shares of Common Stock as shall then be issuable upon theconversion of all outstanding shares of Preferred Stock, andexercise of the Warrants. The Corporation covenants that allshares of Common Stock which shall be so issued shall be duly andvalidly issued, fully paid and non assessable. The Corporationwill take such action as may be required, if the total number ofshares of Common Stock issued and issuable after such action uponconversion of the Preferred Stock, and exercise of the Warrantswould exceed the total number of shares of Common Stock thenauthorized by the Corporation's Certificate of Incorporation, asamended, or would exceed 19.99% of the shares of Common Stock thenoutstanding if required by law or the Rules and Regulations ofNASDAQ or the National Securities Exchange applicable to theCorporation to take such action as a result of exceeding such19.99%, in order to increase the number of shares of Common Stockto permit the Corporation to issue the number of shares of CommonStock required to effect conversion of the Preferred, and exerciseof the Warrants, to a number sufficient to permit conversion of thePreferred Stock, and exercise of the Warrants, including, withoutlimitation, engaging in reasonable efforts to obtain the requisitestockholder approval of any necessary amendment to theCorporation's Restated Certificate of Incorporation, and to obtainshareholders approval in order to effect conversion of thePreferred Stock, and exercise of the Warrants, if required by lawor the rules or regulations of the NASDAQ or National SecuritiesExchange applicable to the Corporation.
7(a) Shareholder Approval. In connection with the issuance to theHolder of the shares of Preferred Stock, pursuant to thisCertificate of Designations, the Corporation is also issuing (i)certain warrants ("RBB Warrants") to the Holder pursuant to theterms of that certain Private Securities Subscription Agreementdated June 30th, 1998 (the "Agreement"), providing for the purchaseof up to 150,000 shares of Common Stock at an exercise price of$2.50 per share and (ii) certain warrants (collectively, the"Liviakis Warrants") to Liviakis Financial Communication, Inc.("Liviakis") and Robert B. Prag providing for the purchase of up toan aggregate of 2,500,000 shares of Common Stock at an exerciseprice of $1.875 per share pursuant to the terms of that Placementand Consulting Agreement dated June 30th, 1998, between Liviakisand the Corporation.
If (i) the aggregate number of shares of Common Stock issued by theCorporation as a result of any or all of the following: (a)conversion of the Preferred Stock, (b) payment of dividends accruedon the Preferred Stock (c) exercise of the RBB Warrants, and (d)exercise of the Liviakis Warrants exceeds 2,388,347 shares ofCommon Stock (which equals 19.9% of the outstanding shares of
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Common Stock of the Corporation as of the date of this Certificateof Designations) and (ii) the Holder has converted or elects toconvert any of the then outstanding shares of Preferred Stockpursuant to the terms of this Section 5 at a Conversion Price lessthan $1.875 ($1.875 the market value per share of Common Stock asquoted on the NASDAQ as of the close of business on June 30th,1998) pursuant to the terms of Section 5(b) hereof, other than ifthe Conversion Price is less than $1.875 solely as a result of theanti-dilution provisions of Section 5(g) and (h) hereof, then,notwithstanding anything in Section 5 to the contrary, theCorporation shall not issue any shares of Common Stock as a resultof receipt of a Conversion Notice unless and until the Corporationshall have obtained approval of its shareholders entitled to voteon the transactions in accordance with subparagraphs (25)(H)(i)d,(iv) and (v) of Rule 4310 of the NASDAQ Marketplace Rules("Shareholder Approval").
If Shareholder Approval is required as set forth in the aboveparagraph, the Corporation shall take all necessary steps to obtainsuch Shareholder Approval upon receipt of the Conversion Noticetriggering the need for Shareholder Approval ("Current ConversionNotice"). If the Corporation has not received from the Holder aCurrent Conversion Notice, the Holder, subsequent to January 1st,1999 may, if the Corporation's shares of Common Stock trade,subsequent to January 1st, 1999, at a five (5) day average closingbid price below Two Dollars and 34/00 ($2.34), upon written noticeto the Corporation, require the Corporation to obtain ShareholderApproval ("Holder's Notice"). The Holder and the Corporation'sofficers and directors covenant to vote all shares of Common Stockover which they have voting control in favour of ShareholderApproval. If the Corporation does not obtain Shareholder Approvalwithin ninety (90) days of the earlier of the Corporation's receiptof (i) the Current Conversion Notice or (ii) the Holder's Notice,and the Holder has not breached its covenant to vote all shares ofCommon Stock over which they have voting control in favour ofShareholder Approval, the Corporation shall pay in cash to theHolder liquidated damages, in an amount of 4% per month of theLiquidation Value of each share of Preferred Stock thenoutstanding, commencing on the 91st day of the Corporation'sreceipt of the Holder's Current Conversion Notice, and continuingevery thirty (30) days pro-rata until such time the Corporationreceives Shareholder Approval.
8. No Reissuance of Series 10 Class J Convertible Preferred Stock.
Shares of Preferred Stock which are converted into shares of CommonStock as provided herein shall be retired and shall becomeauthorized but unissued shares of Preferred Stock, which may bereissued as part of a new series of Preferred stock hereaftercreated.
9. Closing of Books.
The Corporation will at no time close its transfer books againstthe transfer of any Preferred Stock or of any shares of CommonStock issued or issuable upon the conversion of any shares of
;8
Common Stock of Preferred Stock in any manner which interferes withthe timely conversion of such Preferred Stock, except as mayotherwise be required to comply with applicable securities laws.
10. No Preemptive Rights.
The Preferred Stock shall not give its holders any preemptiverights to acquire any other securities issued by the Corporationat any time in the future.
11. Definition of Shares.
As used in this Certificate of Designations, the term "shares ofCommon Stock" shall mean and include the Corporation's authorizedcommon stock, par value $.001, as constituted on the date of filingof these terms of the Preferred Stock, or in case of anyreorganization, reclassification, or stock split of the outstandingshares of Common Stock thereof, the stock, securities or assetsprovided for hereof. The term "Warrants" as used herein shall havethe same meaning as defined in Section 1 of the Private SecuritiesSubscription Agreement, dated June 30th 1998, between the Companyand RBB Bank Aktiengesellschaft.
The said determination of the designations, preferences andrelative, participating, optional or other rights, and thequalifications, limitations or restrictions thereof, relating tothe Preferred Stock was duly made by the Board of Directorspursuant to the provisions of the Corporation's RestatedCertificate of Incorporation and in accordance with the provisionsof the Delaware General Corporation Law.
IN WITNESS HEREOF, this Certificate of Designations has beensigned by:
Dr. Louis F. Centofanti, President on this 30th day of June,1998.
/s/ Louis Centofanti
President, Perma-Fix Environmental Services, Inc.
Richard Kelecy, Secretary on this 30th day of June, 1998
/s/ Richard T. Kelecy ��
Secretary, Perma-Fix Environmental Services, Inc.
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STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 01:30 PM 07/16/1998
981277755 -- 2249849
CERTIFICATE OF ELIMINATION
OF
SERIES 6 CLASS F CONVERTIBLE PREFERRED STOCK
AND
SERIES 7 CLASS G CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
____________________________________________
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporationorganized and existing under the General Corporation Law of theState of Delaware (hereinafter called the "Corporation"), herebycertifies the following:
1. That the Certificate of Designations of Series 6 Class FConvertible Preferred Stock of the Corporation (the "Series 6Preferred") was filed with the Delaware Secretary of State onNovember 13, 1997 (the "Series 6 Certificate of Designations").
2. That all outstanding shares of the Series 6 Preferredhave been delivered to the Company and exchanged upon agreementwith the holder thereof pursuant to the terms and conditions of acertain Second RBB Exchange Agreement between the Company and RBBBank Aktiengesellschaft, dated effective as of February 28, 1998.
3. That no shares of Series 6 Preferred remain outstanding.
4. That all shares of the Series 6 Preferred which have beenexchanged have the status of authorized and unissued shares of thePreferred Stock of the Corporation without designation as toseries, until such shares are once more designated as part of aparticular series by the Board of Directors.
5. That effective February 28, 1998, the Board of Directorsof the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchangewith the holder of
the Series 6 Class FConvertible Preferred Stock, no authorizedshares
of Series 6 Class F ConvertiblePreferred Stock will remain outstanding
and noshares of Series 6 Class F ConvertiblePreferred Stock will be
issued subject to the Certificate of Designations previously filedwith
respect to the Series 6 Class FConvertible Preferred Stock.
FURTHER RESOLVED, that upon completion of theexchange, the
officers of the Company arehereby authorized and directed, for and on
behalf of the Company, to execute and deliver an appropriate Certificate
of Elimination tothe Secretary of State of Delaware regardingthe Series 6
Class F Convertible PreferredStock.
6. That the Certificate of Designations of the Series 7Class G Convertible Preferred Stock of the Corporation (the "Series7 Preferred") was filed on November 13, 1997 (the "Series 7Certificate of Designations").
7. That all outstanding shares of the Series 7 Preferredhave been delivered to the Company and exchanged upon agreementwith the holder thereof pursuant to the terms and conditions of acertain Exchange Agreement between the Company and The InfinityFund, L.P., dated effective as of February 28, 1998.
8. That no shares of Series 7 Preferred remain outstanding.
9. That all shares of the Series 7 Preferred which have beenexchanged have the status of authorized and unissued shares of thePreferred Stock of the Corporation without designation as toseries, until such shares are once more designated as part of aparticular series by the Board of Directors.
10. That effective February 28, 1998, the Board of Directorsof the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchangewith the holder
of the Series 7 Class GConvertible Preferred Stock, no authorizedshares
of Series 7 Class G ConvertiblePreferred Stock will remain outstanding
and noshares of Series 7 Class G ConvertiblePreferred Stock will be issued
subject to theCertificate of Designations previously filedwith respect to the
Series 7 Class GConvertible Preferred Stock.
FURTHER RESOLVED, that upon completion of theexchange, the officers
of the Company arehereby authorized and directed, for and onbehalf of the
Company, to execute and deliveran appropriate Certificate of Elimination to
the Secretary of State of Delaware regardingthe Series 7 Class G Convertible
PreferredStock.
11. That pursuant to the provisions of Section 151(g) of theDelaware General Corporation Law, upon the effective date of thefiling of this Certificate, this Certificate will have the effectof eliminating from the Restated Certificate of Incorporation onlythose matters set forth in the Restated Certificate ofIncorporation with respect to the Series 6 Class F Convertible Preferred Stock and the Series 7 Class G Convertible PreferredStock.
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IN WITNESS WHEREOF, this Certificate of Elimination has beenexecuted this 30th day of April, 1998, by the President of theCompany.
PERMA-FIX ENVIRONMENTAL
ATTEST: SERVICES, INC.
/s/ Richard T. Kelecy By /s/ Louis Centofanti
Richard T. Kelecy, Secretary Dr. Louis F. Centofanti,
President
(SEAL)
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STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 01:31 PM 07/16/1998
981277757 -- 2249849
CERTIFICATE OF DESIGNATIONS
OF SERIES 8 CLASS H CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), acorporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board ofDirectors by the Corporation's Restated Certificate ofIncorporation, as amended, and pursuant to the provisions ofSection 151 of the Delaware Corporation Law, the Board of Directorsof the Corporation has adopted resolutions, a copy of which isattached hereto, establishing and providing for the issuance of aseries of Preferred Stock designated as Series 8 Class HConvertible Preferred Stock and has established and fixed thevoting powers, designations, preferences and relativeparticipating, optional and other special rights andqualifications, limitations and restrictions of such Series 8 ClassH Convertible Preferred Stock as set forth in the attachedresolutions.
Dated: April 30, 1998
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 8 CLASS H CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock,par value $.001 per share ("Preferred Stock"), which PreferredStock may be issued in one or more series by resolutions adopted bythe directors, and with the directors being entitled by resolutionto fix the number of shares in each series and to designate therights, designations, preferences and relative, participating,optional or other special rights and privileges, restrictions andconditions attaching to the shares of each such series;
WHEREAS, it is in the best interests of the Corporation forthe Board to create a new series from the Preferred Stockdesignated as the Series 8 Class H Convertible Preferred Stock, parvalue $.001 per share (the "Series 8 Class H Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 8 Class HPreferred Stock shall consist of two thousand five hundred (2,500)shares and no more and shall be designated as the Series 8 Class HConvertible Preferred Stock, and the preferences, rights,privileges, restrictions and conditions attaching to the Series 8Class H Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Part7 hereof or under Section 242(b)(2) of the GeneralCorporation Law of the State of Delaware (the "GCL"), theholders of the Series 8 Class H Preferred Stock shallhave no voting rights whatsoever. To the extent thatunder Section 242(b)(2) of the GCL or Part 7 hereof, theholders of the Series 8 Class H Preferred Stock areentitled to vote on a matter, each share of the Series 8Class H Preferred Stock shall be entitled one (1) votefor each outstanding share of Series 8 Class H PreferredStock. Holders of the Series 8 Class H Preferred Stockshall be entitled to notice of (and copies of proxymaterials and other information sent to stockholders) forall shareholder meetings or written consents with respectto which they would be entitled to vote, which noticewould be provided pursuant to the Corporation's bylawsand applicable statutes.
1.2 No Preemptive Rights. The Series 8 Class HPreferred Stock shall not give its holders any preemptiverights to acquire any other securities issued by theCorporation at any time in the future.
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Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall bevoluntarily or involuntarily liquidated, dissolved orwound up at any time when any shares of the Series 8Class H Preferred Stock shall be outstanding, the holdersof the then outstanding Series 8 Class H Preferred Stockshall have a preference in distribution of theCorporation's property available for distribution to theholders of the Corporation's Common Stock equal to $1,000consideration per outstanding share of Series 8 Class HPreferred Stock, plus an amount equal to all unpaiddividends accrued thereon to the date of payment of suchdistribution ("Liquidation Preference"), whether or notdeclared by the Board.
2.2 Payment of Liquidation Preferences. Subject to theprovisions of Part 6 hereof, all amounts to be paid asLiquidation Preference to the holders of Series 8 ClassH Preferred Stock, as provided in this Part 2, shall bepaid or set apart for payment before the payment orsetting apart for payment of any amount for, or thedistribution of any of the Corporation's property to theholders of the Corporation's Common Stock, whether now orhereafter authorized, in connection with suchliquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to theholders of the shares of the Series 8 Class H PreferredStock of the full Liquidation Preference amounts providedfor in this Part 2, the holders of the Series 8 Class HPreferred Stock as such shall have no right or claim toany of the remaining assets of the Corporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of theCorporation available for distribution to the holders ofshares of the Series 8 Class H Preferred Stock upon anydissolution, liquidation or winding up of theCorporation, whether voluntary or involuntary, shall beinsufficient to pay in full all amounts to which suchholders are entitled pursuant to this Part 2, no suchdistribution shall be made on account of any shares ofany other class or series of Preferred Stock ranking ona parity with the shares of this Series 8 Class HPreferred Stock upon such dissolution, liquidation orwinding up unless proportionate distributive amountsshall be paid on account of the shares of this Series 8Class H Preferred Stock and shares of such other class orseries ranking on a parity with the shares of this Series8 Class H Preferred Stock, ratably, in proportion to thefull distributable amounts for which holders of all suchparity shares are respectively entitled upon suchdissolution, liquidation or winding up.
Part 3 - Dividends. The holders of the Series 8 Class HPreferred Stock are entitled to receive if, when and asdeclared by the Board out of funds legally availabletherefor, cumulative dividends, payable in cash or CommonStock of the Corporation, par value $.001 per share (the"Common Stock"), or any combination thereof, at theCorporation's election, at the rate of four percent (4%)
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per annum of the Liquidation Value (as defined below) ofeach issued and outstanding share of Series 8 Class HPreferred Stock (the "Dividend Rate"). The LiquidationValue of the Series 8 Class H Preferred Stock shall be$1,000 per outstanding share of the Series 8 Class HPreferred Stock (the "Liquidation Value"). The dividendis payable semi-annually within seven (7) business daysafter each of December 31 and June 30 of each year,commencing June 30, 1998 (each, a "Dividend DeclarationDate"). Dividends shall be paid only with respect toshares of Series 8 Class H Preferred Stock actuallyissued and outstanding on a Dividend Declaration Date andto holders of record of the Series 8 Class H PreferredStock as of the Dividend Declaration Date. Dividendsshall accrue from the first day of the semi-annual periodin which such dividend may be payable, except withrespect to the first semi-annual dividend which shallaccrue from March 1, 1998. In the event that theCorporation elects to pay the accrued dividends due as ofa Dividend Declaration Date on an outstanding share ofthe Series 8 Class H Preferred Stock in Common Stock ofthe Corporation, the holder of such share shall receivethat number of shares of Common Stock of the Corporationequal to the product of (a) the quotient of (i) theDividend Rate divided by (ii) the average of the closingbid quotation of the Corporation's Common Stock asreported on the National Association of SecuritiesDealers Automated Quotation system ("NASDAQ"), or theaverage closing sale price if listed on a nationalsecurities exchange, for the five (5) trading daysimmediately prior to the Dividend Declaration Date (the"Stock Dividend Price"), times (b) a fraction, thenumerator of which is the number of days elapsed duringthe period for which the dividend is to be paid and thedenominator of which is 365. Dividends on the Series 8Class H Preferred Stock shall be cumulative, and nodividends or other distributions shall be paid ordeclared or set aside for payment on the Corporation'sCommon Stock until all accrued and unpaid dividends onall outstanding shares of Series 8 Class H PreferredStock shall have been paid or declared and set aside forpayment.
Part 4 - Conversion. The holders of the Series 8 ClassH Preferred Stock shall have rights to convert the sharesof Series 8 Class H Preferred Stock into shares of theCorporation's Common Stock, par value $.001 per share("Common Stock"), as follows (the "Conversion Rights"):
4.1 Right to Convert. The Series 8 Class H PreferredStock shall be convertible into shares of Common Stock atany time.
4.2 Conversion Price. Subject to the terms hereof, asused herein, the Conversion Price per outstanding shareof Series 8 Class H Preferred Stock shall be $1.8125,except that, in the event the average closing bid priceper share of the Common Stock as reported on the over-the-counter market, or the closing sale price if listedon a national securities exchange, for the five (5)trading days prior to the particular date of conversionshall be less than $2.265, the Conversion Price for onlysuch particular conversion shall be the product of theaverage closing bid quotation of the Common Stock as
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reported on the over-the-counter market, or the closingsale price if listed on a national securities exchange,for the five (5) trading days immediately preceding thedate of the Conversion Notice referred to in Section 4.3below in connection with such conversion multiplied byeighty percent (80%). Notwithstanding the foregoing, theConversion Price shall not be less than a minimum of $.75per share ("Minimum Conversion Price"), which MinimumConversion Price shall be eliminated from and afterSeptember 6, 1998. If any of the outstanding shares ofSeries 8 Class H Preferred Stock are converted, in wholeor in part, into Common Stock pursuant to the terms ofthis Part 4, the number of shares of whole Common Stockto be issued to the holder as a result of such conversionshall be determined by dividing (a) the aggregateLiquidation Value of the Series 8 Class H Preferred Stockso surrendered for conversion by (b) the Conversion Priceas of such conversion. At the time of conversion ofshares of the Series 8 Class H Preferred Stock, theCorporation shall pay in cash to the holder thereof anamount equal to all unpaid and accrued dividends, if any,accrued thereon to the date of conversion, or, at theCorporation's option, in lieu of paying cash for theaccrued and unpaid dividends, issue that number of wholeshares of Common Stock which is equal to the quotient ofthe amount of such unpaid and accrued dividends to thedate of conversion on the shares of Series 8 Class HPreferred Stock so converted divided by the StockDividend Price, as defined in Part 3 hereof, in effect atthe date of conversion.
4.3 Mechanics of Conversion. Any holder of the Series8 Class H Preferred Stock who wishes to exercise itsConversion Rights pursuant to Section 4.1 of this Part 4must, if such shares are not being held in escrow by theCorporation's attorneys, surrender the certificatetherefor at the principal executive office of theCorporation, and give written notice, which may be viafacsimile transmission, to the Corporation at such officethat it elects to convert the same (the "ConversionNotice"). In the event that the shares of Series 8 ClassH Preferred Stock are being held in escrow by theCorporation's attorneys, no delivery of the certificatesshall be required. The Corporation shall, within five(5) business days after receipt of an appropriate andtimely Conversion Notice (and certificate, if necessary),issue to such holder of Series 8 Class H Preferred Stockor its agent a certificate for the number of shares ofCommon Stock to which he shall be entitled; it beingexpressly agreed that until and unless the holderdelivers written notice to the Corporation to thecontrary, all shares of Common Stock issuable uponconversion of the Series 8 Class H Preferred Stockhereunder are to be delivered by the Corporation to aparty designated in writing by the holder in theConversion Notice for the account of the holder and suchshall be deemed valid delivery to the holder of suchshares of Common Stock. Such conversion shall be deemedto have been made only after both the certificate for theshares of Series 8 Class H Preferred Stock to beconverted have been surrendered and the Conversion Noticeis received by the Corporation (or in the event that nosurrender of the Certificate is required, then only uponthe receipt by the Corporation of the Conversion Notice)
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(the "Conversion Documents"), and the person or entitywhose name is noted on the certificate evidencing suchshares of Common Stock issuable upon such conversionshall be treated for all purposes as the record holder ofsuch shares of Common Stock at and after such time. Inthe event that the Conversion Notice is sent viafacsimile transmission, the Corporation shall be deemedto have received such Conversion Notice on the firstbusiness day on which such facsimile Conversion Notice isactually received. If the Corporation fails to deliverto the holder or its agent the certificate representingthe shares of Common Stock that the holder is entitled toreceive as a result of such conversion of the Series 8Class H Preferred Stock within seven (7) business daysafter receipt by the Corporation from the holder of anappropriate and timely Conversion Notice and certificatespursuant to the terms of this Section 4.3 ("Seven (7)Business Day Period"), then, upon the written demand ofRBB Bank Aktiengesellschaft ("RBB Bank"), the holder ofthe Series 8 Class H Preferred Stock, for payment of thepenalty described below in this Section 4.3, which demandmust be received by the Corporation no later than ten(10) calendar days after the expiration of such Seven (7)Business Day Period, the Corporation shall pay to RBBBank the following penalty for each business day afterthe Seven (7) Business Day Period until the Corporationdelivers to the holder or its agent the certificaterepresenting the shares of Common Stock that the holderis entitled to receive as a result of such conversion:business day eight (8) - U.S. $1,000; business day nine(9) - U.S. $2,000, and each business day thereafter anamount equal to the penalty due on the immediatelypreceding business day times two (2) until theCorporation delivers to the holder or its agent thecertificate representing the shares of Common Stock thatthe holder is entitled to receive as a result of suchconversion.
4.4 Merger or Consolidation. In case of either (a) anymerger or consolidation to which the Corporation is aparty (collectively, the "Merger"), other than a Mergerin which the Corporation is the surviving or continuingcorporation, or (b) any sale or conveyance to anothercorporation of all, or substantially all, of the assetsof the Corporation (collectively, the "Sale"), and suchMerger or Sale becomes effective (x) while any shares ofSeries 8 Class H Preferred Stock are outstanding andprior to the date that the Corporation's RegistrationStatement covering up to 1,379,311 shares of Common Stockissuable upon the conversion of the Series 8 Class HPreferred Stock is declared effective by the U. S.Securities and Exchange Commission or (y) prior to theend of the restriction periods in Section 4.1, then, insuch event, the Corporation or such successorcorporation, as the case may be, shall make appropriateprovision so that the holder of each share of Series 8Class H Preferred Stock then outstanding shall have theright to convert such share of Series 8 Class H PreferredStock into the kind and amount of shares of stock orother securities and property receivable upon such Mergeror Sale by a holder of the number of shares of CommonStock into which such shares of Series 8 Class HPreferred Stock could have been converted into
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immediately prior to such Merger or Sale, subject toadjustments which shall be as nearly equivalent as may bepracticable to the adjustments provided for in this Part4.
4.5 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. Ifthe Corporation at any time or from time to time whileshares of Series 8 Class H Preferred Stock are issued andoutstanding shall declare or pay, without consideration,any dividend on the Common Stock payable in Common Stock,or shall effect a subdivision of the outstanding sharesof Common Stock into a greater number of shares of CommonStock (by stock split, reclassification or otherwise thanby payment of a dividend in Common Stock or in any rightto acquire Common Stock), or if the outstanding shares ofCommon Stock shall be combined or consolidated, byreclassification or otherwise, into a lesser number ofshares of Common Stock, then the Conversion Price ineffect immediately before such event shall, concurrentlywith the effectiveness of such event, be proportionatelydecreased or increased, as appropriate.
4.6 Adjustments for Reclassification and Reorganization.If the Common Stock issuable upon conversion of theSeries 8 Class H Preferred Stock shall be changed intothe same or a different number of shares of any otherclass or classes of stock, whether by capitalreorganization, reclassification or otherwise (other thana subdivision or combination of shares provided for inSection 4.4 hereof), the Conversion Price shall,concurrently with the effectiveness of suchreorganization or reclassification, be proportionatelyadjusted so that the Series 8 Class H Preferred Stockshall be convertible into, in lieu of the number ofshares of Common Stock which the holders of Series 8Class H Preferred Stock would otherwise have beenentitled to receive, a number of shares of such otherclass or classes of stock equivalent to the number ofshares of Common Stock that would have been subject toreceipt by the holders upon conversion of the Series 8Class H Preferred Stock immediately before that change.
4.7 Common Stock Duly Issued. All Common Stock whichmay be issued upon conversion of Series 8 Class HPreferred Stock will, upon issuance, be duly issued,fully paid and nonassessable and free from all taxes,liens, and charges with respect to the issue thereof.
4.8 Notice of Adjustments. Upon the occurrence of eachadjustment or readjustment of any Conversion Pricepursuant to this Part 4, the Corporation, at its expense,within a reasonable period of time, shall compute suchadjustment or readjustment in accordance with the termshereof and prepare and furnish to each holder of Series8 Class H Preferred Stock a notice setting forth suchadjustment or readjustment and showing in detail thefacts upon which such adjustment is based.
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4.9 Issue Taxes. The Corporation shall pay any and allissue and other taxes that may be payable in respect ofany issue or delivery of shares of Common Stock onconversion of the Series 8 Class H Preferred Stockpursuant thereto; provided, however, that the Corporationshall not be obligated to pay any transfer taxesresulting from any transfer requested by any holder ofSeries 8 Class H Preferred Stock in connection with suchconversion.
4.10 Reservation of Stock Issuable Upon Conversion. TheCorporation shall at all times reserve and keep availableout of its authorized but unissued shares of CommonStock, solely for the purpose of effecting the conversionof the shares of the Series 8 Class H Preferred Stock,such number of its shares of Common Stock as shall, fromtime to time, be sufficient to effect the conversion ofall outstanding shares of the Series 8 Class H Preferredstock, and, if at any time, the number of authorized butunissued shares of Common Stock shall not be sufficientto effect the conversion of all then outstanding sharesof the Series 8 Class H Preferred Stock, the Corporationwill take such corporate action as may be necessary toincrease its authorized but unissued shares of CommonStock to such number of shares as shall be sufficient forsuch purposes, including, without limitation, engaging inreasonable efforts to obtain the requisite stockholderapproval of any necessary amendment to its Certificate ofIncorporation.
4.11 Fractional Shares. No fractional shares shall beissued upon the conversion of any share or shares ofSeries 8 Class H Preferred Stock. All shares of CommonStock (including fractions thereof) issuable uponconversion of more than one share of Series 8 Class HPreferred Stock by a holder thereof shall be aggregatedfor purposes of determining whether the conversion wouldresult in the issuance of any fractional share. If,after the aforementioned aggregation, the conversionwould result in the issuance of a fractional share ofCommon Stock, such fractional share shall be rounded upto the nearest whole share.
4.12 Notices. Any notices required by the provisions ofthis Part 4 to be given to the holders of shares ofSeries 8 Class H Preferred Stock shall be deemed given ifdeposited in the United States mail, postage prepaid, andaddressed to each holder of record at his addressappearing on the books of the Corporation.
4.13 Business Day. As used herein, the term "businessday" shall mean any day other than a Saturday, Sunday ora day when the federal and state banks located in theState of New York are required or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except asotherwise provided in this Section 5.1, at any time, andfrom time to time, after the expiration of one (1) yearfrom June 9, 1997, the Corporation may, at its soleoption, but shall not be obligated to, redeem, in whole
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or in part, at any time, and from time to time, the thenoutstanding Series 8 Class H Preferred Stock at thefollowing cash redemption prices per share (the"Redemption Price") if redeemed during the followingperiods: (a) within four years from June 9, 1997 - $1,300per share, if at any time during such four year periodthe average of the closing bid price of the Common Stockfor ten consecutive trading days shall be in excess ofFour Dollars ($4.00) per share, and (b) after four yearsfrom June 9, 1997 - $1,000 per share.
5.2 Mechanics of Redemption. Thirty days prior to anydate stipulated by the Corporation for the redemption ofSeries 8 Class H Preferred Stock (the "Redemption Date"),written notice (the "Redemption Notice") shall be mailedto each holder of record on such notice date of theSeries 8 Class H Preferred Stock. The Redemption Noticeshall state: (i) the Redemption Date of such shares, (ii)the number of Series 8 Class H Preferred Stock to beredeemed from the holder to whom the Redemption Notice isaddressed, (iii) instructions for surrender to theCorporation, in the manner and at the place designated,of a share certificate or share certificates representingthe number of Series 8 Class H Preferred Stock to beredeemed from such holder, and (iv) instructions as tohow to specify to the Corporation the number of Series 8Class H Preferred Stock to be redeemed as provided inthis Part 5 and, if the Redemption Notice is mailed tothe Holder after the first 180 days from the date ofissuance of the Series 8 Class H Preferred Stock, thenumber of shares to be converted into Common Stock asprovided in Part 4 hereof.
5.3 Rights of Conversion Upon Redemption. If theredemption occurs after the first 180 days after thefirst issuance of Series 8 Class H Preferred Stock, then,upon receipt of the Redemption Notice, any holder ofSeries 8 Class H Preferred Stock shall have the option,at its sole election, to specify what portion of itsSeries 8 Class H Preferred Stock called for redemption inthe Redemption Notice shall be redeemed as provided inthis Part 5 or converted into Common Stock in the mannerprovided in Part 4 hereof, except that, notwithstandingany provision of such Part 4 to the contrary, such holdershall have the right to convert into Common Stock thatnumber of Series 8 Class H Preferred Stock called forredemption in the Redemption Notice.
5.4 Surrender of Certificates. On or before theRedemption Date in respect of any Series 8 Class HPreferred Stock, each holder of such shares shallsurrender the required certificate or certificatesrepresenting such shares to the Corporation in the mannerand at the place designated in the Redemption Notice, andupon the Redemption Date, the Redemption Price for suchshares shall be made payable, in the manner provided inSection 5.6 hereof, to the order of the person whose nameappears on such certificate or certificates as the ownerthereof, and each surrendered share certificate shall becanceled and retired. If a share certificate issurrendered and all the shares evidenced thereby are not
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being redeemed (as described below), the Corporationshall cause the Series 8 Class H Preferred Stock whichare not being redeemed to be registered in the names ofthe persons or entity whose names appear as the owners onthe respective surrendered share certificates and deliversuch certificate to such person.
5.5 Payment. On the Redemption Date in respect of anySeries 8 Class H Preferred Stock or prior thereto, theCorporation shall deposit with any bank or trust companyhaving a capital and surplus of at least $50,000,000, asa trust fund, a sum equal to the aggregate RedemptionPrice of all such shares called from redemption (less theaggregate Redemption Price for those Series 8 Class HPreferred Stock in respect of which the Corporation hasreceived notice from the holder thereof of its electionto convert Series 8 Class H Preferred Stock into CommonStock), with irrevocable instructions and authority tothe bank or trust company to pay, on or after theRedemption Date, the Redemption Price to the respectiveholders upon the surrender of their share certificates. The deposit shall constitute full payment for the sharesto their holders, and from and after the date of thedeposit the redeemed shares shall be deemed to be nolonger outstanding, and holders thereof shall cease to beshareholders with respect to such shares and shall haveno rights with respect thereto except the rights toreceive from the bank or trust company payments of theRedemption Price of the shares, without interest, uponsurrender of their certificates thereof. Any funds sodeposited and unclaimed at the end of one year followingthe Redemption Date shall be released or repaid to theCorporation, after which the former holders of sharescalled for redemption shall be entitled to receivepayment of the Redemption Price in respect of theirshares only from the Corporation.
Part 6 - Parity with Other Shares of Series 8 Class HPreferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividendsor return of capital in respect of Series 8 Class HPreferred Stock are not paid in full, the owners of allseries of outstanding Preferred Stock shall participaterateably in respect of accumulated dividends and returnof capital.
6.2 Ranking. For purposes of this resolution, any stockof any class or series of the Corporation shall be deemedto rank:
6.2.1 Prior or senior to the shares of thisSeries 8 Class H Preferred Stock eitheras to dividends or upon liquidation, ifthe holders of such class or classesshall be entitled to the receipt ofdividends or of amounts distributableupon dissolution, liquidation or windingup of the Corporation, whether voluntaryor involuntary, as the case may be, inpreference or priority to the holders ofshares of this Series 8 Class H PreferredStock;
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6.2.2 On a parity with, or equal to, shares ofthis Series 8 Class H Preferred Stock,either as to dividends or uponliquidation, whether or not the dividendrates, dividend payment dates, orredemption or liquidation prices pershare or sinking fund provisions, if any,are different from those of this Series 8Class H Preferred Stock, if the holdersof such stock are entitled to the receiptof dividends or of amounts distributableupon dissolution, liquidation or windingup of the Corporation, whether voluntaryor involuntary, in proportion to theirrespective dividend rates or liquidationprices, without preference or priority,one over the other, as between theholders of such stock and over the other,as between the holders of such stock andthe holders of shares of this Series 8Class H Preferred Stock; and,
6.2.3 Junior to shares of this Series 8 Class HPreferred Stock, either as to dividendsor upon liquidation, if such class orseries shall be Common Stock or if theholders of shares of this Series 8 ClassH Preferred Stock shall be entitled toreceipt of dividends or of amountsdistributable upon dissolution,liquidation or winding up of theCorporation, whether voluntary orinvoluntary, as the case may be, inpreference or priority to the holders ofshares of such class or series.
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Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to theCorporation's Certificate of Incorporation (the"Articles") would alter or change the powers, preferencesor special rights of the Series 8 Class H Preferred Stockso as to affect such adversely, then the Corporation mustobtain the affirmative vote of such amendment to theArticles at a duly called and held series meeting of theholders of the Series 8 Class H Preferred Stock orwritten consent by the holders of a majority of theSeries 8 Class H Preferred Stock then outstanding. Notwithstanding the above or the provisions of Section242(b)(2) of the GCL, the number of authorized shares ofany class or classes of stock of the Corporation may beincreased or decreased (but not below the number ofshares thereof outstanding) by the affirmative vote ofthe holders of a majority of the stock of the Corporationentitled to vote thereon, voting together as a singleclass, irrespective of the provisions of this Section 7.1or Section 242(b)(2) of the GCL.
7.2 Authorized. Any shares of Series 8 Class HPreferred Stock acquired by the Corporation by reason ofpurchase, conversion, redemption or otherwise shall beretired and shall become authorized but unissued sharesof Preferred Stock, which may be reissued as part of anew series of Preferred Stock hereafter created.
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CERTIFICATE OF DESIGNATIONS
OF SERIES 9 CLASS I CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), acorporation organized and existing under the General CorporationLaw of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board ofDirectors by the Corporation's Restated Certificate ofIncorporation, as amended, and pursuant to the provisions ofSection 151 of the Delaware Corporation Law, the Board of Directorsof the Corporation has adopted resolutions, a copy of which isattached hereto, establishing and providing for the issuance of aseries of Preferred Stock designated as Series 9 Class IConvertible Preferred Stock and has established and fixed thevoting powers, designations, preferences and relativeparticipating, optional and other special rights andqualifications, limitations and restrictions of such Series 9 ClassI Convertible Preferred Stock as set forth in the attachedresolutions.
Dated: April 30, 1998
PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 01:32 PM 07/16/1998
981277758 -- 2249849
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 9 CLASS I CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock,par value $.001 per share ("Preferred Stock"), which PreferredStock may be issued in one or more series by resolutions adopted bythe directors, and with the directors being entitled by resolutionto fix the number of shares in each series and to designate therights, designations, preferences and relative, participating,optional or other special rights and privileges, restrictions andconditions attaching to the shares of each such series;
WHEREAS, it is in the best interests of the Corporation forthe Board to create a new series from the Preferred Stockdesignated as the Series 9 Class I Convertible Preferred Stock, parvalue $.001 per share (the "Series 9 Class I Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 9 Class IPreferred Stock shall consist of three hundred (350) shares and nomore and shall be designated as the Series 9 Class I ConvertiblePreferred Stock, and the preferences, rights, privileges,restrictions and conditions attaching to the Series 9 Class IPreferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Part 7 hereof or under Section 242(b)(2) of the General Corporation Law of theState of Delaware (the "GCL"), the holders of the Series 9 Class IPreferred Stock shall have no voting rights whatsoever. To theextent that under Section 242(b)(2) of the GCL or Part 7 hereof,the holders of the Series 9 Class I Preferred Stock are entitled tovote on a matter, each share of the Series 9 Class I PreferredStock shall be entitled one (1) vote for each outstanding share ofSeries 9 Class I Preferred Stock. Holders of the Series 9 Class IPreferred Stock shall be entitled to notice of (and copies of proxymaterials and other information sent to stockholders) for allshareholder meetings or written consents with respect to which theywould be entitled to vote, which notice would be provided pursuantto the Corporation's bylaws and applicable statutes. If theholders of the Series 9 Class I Preferred Stock are required tovote under Section 242(b)(2) of the GCL as a result of the numberof authorized shares of any such class or classes of stock beingincreased or decreased, the number of authorized shares of any ofsuch class or classes of stock may be increased or decreased (butnot below the number of shares thereof then outstanding) by theaffirmative vote of the holders of a majority of the stock of theCorporation entitled to vote thereon, irrespective of theprovisions of Section 242(b)(2) of the GCL.
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1.2 No Preemptive Rights. The Series 9 Class I Preferred Stockshall not give its holders any preemptive rights to acquire anyother securities issued by the Corporation at any time in thefuture.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily orinvoluntarily liquidated, dissolved or wound up at any time whenany shares of the Series 9 Class I Preferred Stock shall beoutstanding, the holders of the then outstanding Series 9 Class IPreferred Stock shall be entitled to receive out of the assets ofthe Corporation available for distribution to shareholders anamount equal to $1,000 consideration per outstanding share ofSeries 9 Class I Preferred Stock, and no more, plus an amount equalto all unpaid dividends accrued thereon to the date of payment ofsuch distribution ("Liquidation Preference"), whether or notdeclared by the Board of Directors, before any payment shall bemade or any assets distributed to the holders of the Corporation'sCommon Stock.
2.2 Payment of Liquidation Preferences. Subject to the provisionsof Part 6 hereof, all amounts to be paid as Liquidation Preferenceto the holders of Series 9 Class I Preferred Stock, as provided inthis Part 2, shall be paid or set apart for payment before thepayment or setting apart for payment of any amount for, or thedistribution of any of the Corporation's property to the holders ofthe Corporation's Common Stock, whether now or hereafterauthorized, in connection with such liquidation, dissolution orwinding up.
2.3 No Rights After Payment. After the payment to the holders ofthe shares of the Series 9 Class I Preferred Stock of the fullLiquidation Preference amounts provided for in this Part 2, theholders of the Series 9 Class I Preferred Stock as such shall haveno right or claim to any of the remaining assets of theCorporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. Inthe event that the assets of the Corporation available fordistribution to the holders of shares of the Series 9 Class IPreferred Stock upon any dissolution, liquidation or winding up ofthe Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders areentitled pursuant to this Part 2, no such distribution shall bemade on account of any shares of any other class or series ofPreferred Stock ranking on a parity with the shares of this Series9 Class I Preferred Stock upon such dissolution, liquidation orwinding up unless proportionate distributive amounts shall be paidon account of the shares of this Series 9 Class I Preferred Stockand shares of such other class or series ranking on a parity withthe shares of this Series 9 Class I Preferred Stock, ratably, inproportion to the full distributable amounts for which holders ofall such parity shares are respectively entitled upon suchdissolution, liquidation or winding up.
Part 3 - Dividends.
3.1 The holders of the Series 9 Class I Preferred Stock areentitled to receive if, when and as declared by the Board ofDirectors of the Corporation (the "Board") out of funds legally
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available therefor, cumulative annual dividends, payable in cash orCommon Stock of the Corporation, par value $.001 per share (the"Common Stock"), or any combination thereof, at the Corporation'selection, at the rate of four percent (4%) per annum of theLiquidation Value (as defined below) of each issued and outstandingshare of Series 9 Class I Preferred Stock (the "Dividend Rate").The Liquidation Value of the Series 9 Class I Preferred Stock shallbe $1,000 per outstanding share of the Series 9 Class I PreferredStock (the "Liquidation Value"). The dividend is payable semi-annually within seven (7) business days after each of December 31and June 30 of each year, commencing June 30, 1998 (each, a"Dividend Declaration Date"). Dividends shall be paid only withrespect to shares of Series 9 Class I Preferred Stock actuallyissued and outstanding on a Dividend Declaration Date and toholders of record of the Series 9 Class I Preferred Stock as of theDividend Declaration Date. Dividends shall accrue from the firstday of the semi-annual period in which such dividend may bepayable, except with respect to the first semi-annual dividendwhich shall accrue from March 1, 1998. In the event that theCorporation elects to pay the accrued dividends due as of aDividend Declaration Date on an outstanding share of the Series 9Class I Preferred Stock in Common Stock of the Corporation, theholder of such share shall receive that number of shares of CommonStock of the Corporation equal to the product of (a) the quotientof (i) the Dividend Rate divided by (ii) the average of the closingbid quotation of the Corporation's Common Stock as reported on theNational Association of Securities Dealers Automated Quotationsystem ("NASDAQ"), or the average closing sale price if listed ona national securities exchange, for the five (5) trading daysimmediately prior to the Dividend Declaration Date (the "StockDividend Price"), times (b) a fraction, the numerator of which isthe number of days elapsed during the period for which the dividendis to be paid and the denominator of which is 365. Dividends onthe Series 9 Class I Preferred Stock shall be cumulative, and nodividends or other distributions shall be paid or declared or setaside for payment on the Corporation's Common Stock until allaccrued and unpaid dividends on all outstanding shares of Series 9Class I Preferred Stock shall have been paid or declared and setaside for payment.
Part 4 - Conversion. The holders of the Series 9 Class I PreferredStock shall have rights to convert the shares of Series 9 Class IPreferred Stock into shares of the Corporation's Common Stock, asfollows (the "Conversion Rights"):
4.1 Right to Convert. The Series 9 Class I Preferred Stock shallbe convertible into shares of Common Stock at any time.
4.2 Conversion Price. Subject to the terms hereof, as usedherein, the Conversion Price per outstanding share of Series9 Class I Preferred Stock shall be $1.8125, except that, inthe event the average closing bid price per share of theCommon Stock as reported on the over-the-counter market, orthe closing sale price if listed on a national securitiesexchange, for the five (5) trading days prior to theparticular date of conversion shall be less than $2.265, theConversion Price for only such particular conversion shall bethe product of the average closing bid quotation of the CommonStock as reported on the over-the-counter market, or theclosing sale price if listed on a national securitiesexchange, for the five (5) trading days immediately precedingthe date of the Conversion Notice referred to in Section 4.3below in connection with such conversion multiplied by eighty
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percent (80%). Notwithstanding the foregoing, the ConversionPrice shall not be less than a minimum of $.75 per share("Minimum Conversion Price"), which Minimum Conversion Priceshall be eliminated from and after September 6, 1998. If anyof the outstanding shares of Series 9 Class I Preferred Stockare converted, in whole or in part, into Common Stock pursuantto the terms of this Part 4, the number of shares of wholeCommon Stock to be issued to the holder as a result of suchconversion shall be determined by dividing (a) the aggregateLiquidation Value of the Series 9 Class I Preferred Stock sosurrendered for conversion by (b) the Conversion Price as ofsuch conversion. At the time of conversion of shares of theSeries 9 Class I Preferred Stock, the Corporation shall pay incash to the holder thereof an amount equal to all unpaid andaccrued dividends, if any, accrued thereon to the date ofconversion, or, at the Corporation's option, in lieu of payingcash for the accrued and unpaid dividends, issue that numberof whole shares of Common Stock which is equal to the quotientof the amount of such unpaid and accrued dividends to the dateof conversion on the shares of Series 9 Class I PreferredStock so converted divided by the Stock Dividend Price, asdefined in Part 3 hereof, in effect at the date of conversion.
4.3 Mechanics of Conversion. Any holder of the Series 9 Class IPreferred Stock who wishes to exercise its Conversion Rightspursuant to Section 4.1 of this Part 4 must surrender thecertificate therefor at the principal executive office of theCorporation, and give written notice, which may be viafacsimile transmission, to the Corporation at such office thatit elects to convert the same (the "Conversion Notice"). TheCorporation shall, within seven (7) business days afterreceipt of an appropriate and timely Conversion Notice (andcertificate, if necessary), issue to such holder of Series 9Class I Preferred Stock or its agent a certificate for thenumber of shares of Common Stock to which he shall beentitled; it being expressly agreed that until and unless theholder delivers written notice to the Corporation to thecontrary, all shares of Common Stock issuable upon conversionof the Series 9 Class I Preferred Stock hereunder are to bedelivered by the Corporation to a party designated in writingby the holder in the Conversion Notice for the account of theholder and such shall be deemed valid delivery to the holderof such shares of Common Stock. Such conversion shall bedeemed to have been made only after both the certificate forthe shares of Series 9 Class I Preferred Stock to be convertedhave been surrendered and the Conversion Notice is received bythe Corporation (the "Conversion Documents"), and the personor entity whose name is noted on the certificate evidencingsuch shares of Common Stock issuable upon such conversionshall be treated for all purposes as the record holder of suchshares of Common Stock at and after such time. In the eventthat the Conversion Notice is sent via facsimile transmission,the Corporation shall be deemed to have received suchConversion Notice on the first business day on which suchfacsimile Conversion Notice is actually received.
4.4 Merger or Consolidation. In case of either (a) any merger orconsolidation to which the Corporation is a party(collectively, the "Merger"), other than a Merger in which theCorporation is the surviving or continuing corporation, or (b)any sale or conveyance to another corporation of all, orsubstantially all, of the assets of the Corporation
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(collectively, the "Sale"), and such Merger or Sale becomeseffective (x) while any shares of Series 9 Class I PreferredStock are outstanding and prior to the date that theCorporation's Registration Statement covering up to 200,000shares of Common Stock issuable upon the conversion of theSeries 9 Class I Preferred Stock is declared effective by theU. S. Securities and Exchange Commission or (y) prior to theend of the restriction periods in Section 4.1, then, in suchevent, the Corporation or such successor corporation, as thecase may be, shall make appropriate provision so that theholder of each share of Series 9 Class I Preferred Stock thenoutstanding shall have the right to convert such share ofSeries 9 Class I Preferred Stock into the kind and amount ofshares of stock or other securities and property receivableupon such Merger or Sale by a holder of the number of sharesof Common Stock into which such shares of Series 9 Class IPreferred Stock could have been converted into immediatelyprior to such Merger or Sale, subject to adjustments whichshall be as nearly equivalent as may be practicable to theadjustments provided for in this Part 4.
4.5 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If theCorporation at any time or from time to time while shares ofSeries 9 Class I Preferred Stock are issued and outstandingshall declare or pay, without consideration, any dividend onthe Common Stock payable in Common Stock, or shall effect asubdivision of the outstanding shares of Common Stock into agreater number of shares of Common Stock (by stock split,reclassification or otherwise than by payment of a dividend inCommon Stock or in any right to acquire Common Stock), or if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
4.6 Adjustments for Reclassification and Reorganization. If theCommon Stock issuable upon conversion of the Series 9 Class IPreferred Stock shall be changed into the same or a differentnumber of shares of any other class or classes of stock,whether by capital reorganization, reclassification orotherwise (other than a subdivision or combination of sharesprovided for in Section 4.4 hereof), the Conversion Price thenin effect shall, concurrently with the effectiveness of suchreorganization or reclassification, be proportionatelyadjusted so that the Series 9 Class I Preferred Stock shall beconvertible into, in lieu of the number of shares of CommonStock which the holders of Series 9 Class I Preferred Stockwould otherwise have been entitled to receive, a number ofshares of such other class or classes of stock equivalent tothe number of shares of Common Stock that would have beensubject to receipt by the holders upon conversion of theSeries 9 Class I Preferred Stock immediately before thatchange.
4.7 Common Stock Duly Issued. All Common Stock which may beissued upon conversion of Series 9 Class I Preferred Stockwill, upon issuance, be duly issued, fully paid andnonassessable and free from all taxes, liens, and charges withrespect to the issue thereof.
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4.8 Notice of Adjustments. Upon the occurrence of each adjustmentor readjustment of any Conversion Price pursuant to this Part4, the Corporation, at its expense, within a reasonable periodof time, shall compute such adjustment or readjustment inaccordance with the terms hereof and prepare and furnish toeach holder of Series 9 Class I Preferred Stock a noticesetting forth such adjustment or readjustment and showing indetail the facts upon which such adjustment is based.
4.9 Issue Taxes. The Corporation shall pay any and all issue andother taxes that may be payable in respect of any issue ordelivery of shares of Common Stock on conversion of the Series9 Class I Preferred Stock pursuant thereto; provided, however,that the Corporation shall not be obligated to pay anytransfer taxes resulting from any transfer requested by anyholder of Series 9 Class I Preferred Stock in connection withsuch conversion.
4.10 Reservation of Stock Issuable Upon Conversion. TheCorporation shall at all times reserve and keep available outof its authorized but unissued shares of Common Stock, solelyfor the purpose of effecting the conversion of the shares ofthe Series 9 Class I Preferred Stock, such number of itsshares of Common Stock as shall, from time to time, besufficient to effect the conversion of all outstanding sharesof the Series 9 Class I Preferred stock, and, if at any time,the number of authorized but unissued shares of Common Stockshall not be sufficient to effect the conversion of all thenoutstanding shares of the Series 9 Class I Preferred Stock,the Corporation will take such corporate action as may benecessary to increase its authorized but unissued shares ofCommon Stock to such number of shares as shall be sufficientfor such purposes, including, without limitation, engaging inreasonable efforts to obtain the requisite stockholderapproval of any necessary amendment to its Certificate ofIncorporation.
4.11 Fractional Shares. No fractional shares shall be issued uponthe conversion of any share or shares of Series 9 Class IPreferred Stock. All shares of Common Stock (includingfractions thereof) issuable upon conversion of more than oneshare of Series 9 Class I Preferred Stock by a holder thereofshall be aggregated for purposes of determining whether theconversion would result in the issuance of any fractionalshare. If, after the aforementioned aggregation, theconversion would result in the issuance of a fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.12 Notices. Any notices required by the provisions of this Part 4 to be given to the holders of shares of Series 9 Class I Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.
4.13 Business Day. As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or a day when the federal and state banks located in the State of New York are required or is permitted to close.
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Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, after the expiration of one (1) year from the date of the first issuance of the Series 9 Class I Preferred Stock, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, the then outstanding Series 9 Class I Preferred Stock at the following cash redemption prices per share (the "Redemption Price") if redeemed during the following periods: (a) within four (4) years from the date of the first issuance of Series 9 Class I Preferred Stock - - $1,300 per share, if at any time during such four (4) year period the average of the closing bid price of the Common Stock for ten (10) consecutive trading days shall be in excess of Four U.S. Dollars ($4.00) per share, and (b) after four (4) years from the date of the first issuance of Series 9 Class I Preferred Stock - $1,000 per share.
5.2 Mechanics of Redemption. Thirty (30) days prior to any date stipulated by the Corporation for the redemption of Series 9 Class I Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 9 Class I Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 9 Class I Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 9 Class I Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 9 Class I Preferred Stock to be redeemed as provided in this Part 5.
5.3 Rights of Conversion Upon Redemption. If the redemption occurs after the first one hundred eighty (180) days after the first issuance of Series 9 Class I Preferred Stock, then, upon receipt of the Redemption Notice, any holder of Series 9 Class I Preferred Stock shall have the option, at its sole election, to specify what portion of its Series 9 Class I Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof.
5.4 Surrender of Certificates. On or before the Redemption Date in respect of any Series 9 Class I Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.6 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 9 Class I Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
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5.5 Payment. On the Redemption Date in respect of any Series 9 Class I Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 9 Class I Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 9 Class I Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 9 Class I Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 9 Class I Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 9 Class I Preferred Stock either as to dividends
or upon liquidation, if the holders of such class or classes shall be entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in preference or
priority to the holders of shares of this Series 9 Class I Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 9 Class I Preferred Stock, either as to
dividends or upon liquidation, whether or not the dividend rates, dividend payment dates,
or redemption or liquidation prices per share or sinking fund provisions, if any, are
different from those of this Series 9 Class I Preferred Stock, if the holders of such stock
are entitled to the receipt of dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether voluntary or involuntary, in
proportion to their respective dividend rates
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or liquidation prices, without preference or priority, one over the other, as between
the holders of such stock and over the other, as between the holders of such stock
and the holders of shares of this Series 9 Class I Preferred Stock; and,
6.2.3 Junior to shares of this Series 9 Class I Preferred Stock, either as to dividends or upon
liquidation, if such class or series shall be Common Stock or if the holders of shares
of this Series 9 Class I Preferred Stock shall be entitled to receipt of dividends or of
amounts distributable upon dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, as the case may be, in preference or priority to the
holders of shares of such class or series.
Part 7 - Reissue.
7.1 Authorized. Any shares of Series 9 Class I Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
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STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:30 PM 07/15/1999
991291288 -- 2249849
OF SERIES 11 CLASS K CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 11 Class K Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 11 Class K Convertible Preferred Stock as set forth in the attached resolutions.
Dated: July 15, 1999 PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 11 CLASS K CONVERTIBLE PREFERRED STOCK
WHEREAS,
A. The Corporation's share capital includes Preferred Stock, par value $.001 per share
("Preferred Stock"), which Preferred Stock may be issued in one or more series by the
Board of Directors of the Corporation (the "Board") being entitled by resolution to fix the
number of shares in each series and to designate the rights, designations, preferences, and
relative, participating, optional or other special rights, privileges, restrictions and conditions
attaching to the shares of each such series; and
B. It is in the best interests of the Corporation for the Board to create a new series from the
Preferred Stock designated as the Series 11 Class K Convertible Preferred Stock, par value $.001.
NOW, THEREFORE, BE IT RESOLVED, THAT:
The Series 11 Class K Convertible Preferred Stock, par value $.001 (the "Series 11 Class K Preferred Stock") of the Corporation shall consist of 1,769 shares and no more and shall be designated as the Series 11 Class K Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 11 Class K Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided herein, in the Corporation's Certificate of Incorporation (the "Articles") or the General Corporation Law of the State of Delaware (the "GCL"), the holders of the Series 11 Class K Preferred Stock shall have no voting rights whatsoever. To the extent that under the GCL the vote of the holders of the Series 11 Class K Preferred Stock, voting separately as a class or series as applicable, is required to authorize a given action of the Corporation, the affirmative vote or consent of the holders of at least a majority of the shares of the Series 11 Class K Preferred Stock represented at a duly held meeting at which a quorum is present or by written consent of a majority of the shares of Series 11 Class K Preferred Stock (except as otherwise may be required under the GCL) shall constitute the approval
of such action by the series. To the extent that under the GCL the holders of the Series 11 Class K Preferred Stock are entitled to vote on a matter with holders of Corporation's Common Stock and/or any other class or series of the Corporation's voting securities, the Series 11 Class K Preferred Stock, the Corporation's Common Stock and all other classes or series of the Corporation's voting securities shall vote together as one class, with each share of Series 11 Class K Preferred Stock entitled to a number of votes equal to the number of shares of the Corporation's Common Stock into which it is then convertible using the record date for the taking of such vote of stockholders as the date as of which the Conversion Price (as defined in Section 4.2 hereof) is calculated and conversion is effected. Holders of the Series 11 Class K Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 11 Class K Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any shares of the Series 11 Class K Preferred Stock shall be outstanding, the holders of the then outstanding Series 11 Class K Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Corporation's Common Stock equal to $1,000 consideration per outstanding share of Series 11 Class K Preferred Stock, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of such distribution ("Liquidation Preference"), whether or not declared by the Board.
2.2 Payment of Liquidation Preferences. Subject to the provisions of Part 6 hereof, all amounts to be paid as Liquidation Preference to the holders of Series 11 Class K Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of the Corporation's Common Stock, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to the holders of the shares of the Series 11 Class K Preferred Stock of the full Liquidation Preference amounts provided for in this Part 2, the holders of the Series 11 Class K Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 11 Class K Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be
insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 11 Class K Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 11 Class K Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 11 Class K Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
Part 3 - Dividends.
3.1 The holders of the Series 11 Class K Preferred Stock are entitled to receive if, when and as declared by the Board out of funds legally available therefor, cumulative dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), at the Corporation's election, at the rate of six percent (6%) per annum of the Liquidation Value of the Series 11 Class K Preferred Stock. The Liquidation Value of the Series 11 Class K Preferred Stock shall be $1,000.00 per share (the "Dividend Rate"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing December 31, 1996 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 11 Class K Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from the date of issuance of the Series 11 Class K Preferred Stock. In the event that the Corporation elects to pay dividends in Common Stock of the Corporation, each holder of the Series 11 Class K Preferred Stock shall receive shares of Common Stock of the Corporation equal to the quotient of (i) the Dividend Rate in effect on the applicable Dividend Declaration Date dividend by (ii) the average of the closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"). Dividends on the Series 11 Class K Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 11 Class K Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 11 Class K Preferred Stock shall have rights to convert the shares of Series 11 Class K Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1 No Right to Convert. The Series 11 Class K Preferred shall not be convertible into shares of Common Stock until after July 15, 2000.
4.2 Right to Convert. The Series 11 Class K Preferred Stock may be convertible into shares of Common Stock at any time on or after July 15, 2000.
4.3 Conversion Price. As used herein, the term Conversion Price shall be the product of (i) the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately preceding the date of the Conversion Notice referred to in Section 4.3 below multiplied by (ii) seventy-five percent (75%), subject to the provisions of this Section 4.3. Notwithstanding the foregoing, the Conversion Price shall not be (i) less than a minimum of $1.50 per share for a period of twenty-four (24) months from the date of issuance of the Series 11 Class K Preferred Stock, or, after twenty-four (24) months from the date of issuance of the Series 11 Class K Preferred Stock, a minimum of $.50 per share (as applicable, the "Minimum Conversion Price") or (ii) more than a maximum of $1.50 per share ( "Maximum Conversion Price"). If, after July 1, 1996, the Corporation sustains a net loss, on a consolidated basis, in each of two (2) consecutive quarters, as determined under generally accepted accounting principles, the Minimum Conversion Price shall be reduced $.25 a share, but there shall be no change to, or reduction of, the Maximum Conversion Price. For the purpose of determining whether the Corporation has had a net loss in each of two (2) consecutive quarters, at no time shall a quarter that has already been considered in such determination be considered in any subsequent determination (as an example the third quarter of 1996 in which there is a net profit and the fourth quarter of 1996 in which there is a net loss shall be considered as two consecutive quarters, and, as a result, the fourth quarter of 1996 shall not be considered along with the first quarter of 1997 as two (2) consecutive quarters, but the first quarter of 1997 must be considered with the second quarter of 1997 for the purposes of such determination). For the purposes of this Section 4.2, a "quarter" is a three (3) month period ending on March 31, June 30, September 30, and December 31. If any of the outstanding shares of Series 11 Class K Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 11 Class K Preferred Stock so surrendered for conversion by (b) the Conversion Price in effect at the date of the conversion. At the time of conversion of shares of the Series 11 Class K Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the product of dividing the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 11 Class K Preferred Stock so converted by the Conversion Price in effect at the date of conversion.
4.4 Mechanics of Conversion. Any holder of the Series 11 Class K Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such
office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 11 Class K Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. No Conversion Notice with respect to any shares of Series 11 Class K Preferred Stock can be given prior to the time such shares of Series 11 Class K Preferred Stock are eligible for conversion in accordance with the provision of Section 4.1 above. Any such premature Conversion Notice shall automatically be null and void. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 11 Class K Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 11 Class K Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of Series 11 Class K Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion within five (5) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.3, the Corporation shall pay to the holder U.S. $1,000 for each day that the Corporation is late in delivering such certificate to the holder or its agent.
4.5 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 11 Class K Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate. If the Corporation shall declare or pay, without consideration, any dividend on the Common Stock payable in any right to acquire Common stock for no consideration, then the Corporation
shall be deemed to have made a dividend payable in Common Stock in an amount of shares equal to the maximum number of shares issuable upon exercise of such rights to acquire Common Stock.
4.6. Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 11 Class K 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 4.4 hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 11 Class K Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 11 Class K Preferred Stock 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 11 Class K Preferred Stock immediately before that change.
4.7 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 11 Class K Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof.
4.8 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 11 Class K Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.9 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 the Series 11 Class K Preferred Stock pursuant thereto;provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 11 Class K Preferred Stock in connection with such conversion.
4.10 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 11 Class K 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 11 Class K 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 11 Class K Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
4.11 Fractional Shares. No fractional share shall be issued upon the conversion of any share or shares of Series 11 Class K Preferred Stock. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series 11 Class K 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 fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.12 Notices. Any notices required by the provisions of this Part 4 to be given to the holders of shares of Series 11 Class K Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.
4.13 Business Day. As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or a day when the federal and state banks located in the State of New York are required or permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, the then outstanding Series 11 Class K Preferred Stock at the following cash redemption prices if redeemed during the following periods: (i)within one year fromJuly 15, 1999 - $1,100 per share, and (ii) after one year fromJuly 15, 1999 - $1,200 per share (as applicable, the redemption price of $1,100 or $1,200 is referred to herein as the "Redemption Price").
5.2 Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 11 Class K Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 11 Class K Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 11 Class K Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 11 Class K Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 11 Class K Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first year from the date of issuance of the Series 11 Class K Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.3 Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 11 Class K Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 11 Class K Preferred Stock. The
Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 11 Class K Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 11 Class K Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 11 Class K Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first year from the date of issuance of the Series 11 Class K Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.4 Rights of Conversion Upon Redemption. If the redemption occurs during the first 12 months after the issuance of the Series 11 Class K Preferred Stock, the holder may not convert any redeemed shares. If the redemption occurs pursuant to Section 5.1 hereof, the Holder of the Series 11 Class K Preferred Stock shall not have the right to convert those outstanding shares of Series 11 Class K Preferred Stock that the Company is redeeming after receipt of the Redemption Notice. If the redemption occurs pursuant to Section 5.2 hereof, then, upon receipt of the Redemption Notice, any holder of Series 11 Class K Preferred Stock shall have the next five business days during which it may exercise the option, at its sole election, to specify what portion of its Series 11 Class K Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, after one year from the date of first issuance of the Series 11 Class K Preferred Stock, such holder shall have the right to convert into Common Stock that number of Series 11 Class K Preferred Stock called for redemption in the Redemption Notice.
5.5 Surrender of Certificates. On or before the Redemption Date in respect of any Series 11 Class K Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.5 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 11 Class K Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.6 Payment. On the Redemption Date in respect of any Series 11 Class K Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate First Year Redemption Price or the Redemption Price, whichever is applicable, of all such shares called from redemption (less the aggregate Redemption Price for those Series 11 Class K Preferred Stock in respect of which the Corporation has received notice from the
holder thereof of its election to convert Series 11 Class K Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the First Year Redemption Price or the Redemption Price, whichever is applicable, to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the First Year Redemption Price or the Redemption Price, whichever is applicable, of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the First Year Redemption Price or the Redemption Price, whichever is applicable, in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 11 Class K Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 11 Class K Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 11 Class K Preferred Stock either as to
dividends or upon liquidation, if the holders of such class or classes shall be entitled
to the receipt of dividends or of amounts distributable upon dissolution, liquidation
or winding up of the Corporation, whether voluntary or involuntary, as the case
may be, in preference or priority to the holders of shares of this Series 11 Class
K Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 11 Class K Preferred Stock, either
as to dividends or upon liquidation, whether or not the dividend rates, dividend
payment dates, or redemption or liquidation prices per share or sinking fund
provisions, if any, are different from those of this Series 3 Class C Preferred Stock,
if the holders of such stock are entitled to the receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, in proportion to their respective dividend rates or liquidation
prices, without preference or priority, one over the other, as between the holders of
such stock and over the other, as between the holders of such stock and the holders
of shares of this Series 11 Class K Preferred Stock; and,
6.2.3 Junior to shares of this Series 11 Class K Preferred Stock, either as to dividends or
upon liquidation, if such class or series shall be Common Stock or if the holders of
shares of this Series 11 Class K Preferred Stock shall be entitled to receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of
the Corporation, whether voluntary or involuntary, as the case may be, in preference
or priority to the holders of shares of such class or series.
Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to the Corporation's Certificate of Incorporation would alter or change the powers, preferences or special rights of the Series 11 Class K Preferred Stock so as to affect such adversely, then the Corporation must obtain the affirmative vote of such amendment to the Certificate of Incorporation at a duly called and held series meeting of the holders of the Series 11 Class K Preferred Stock or written consent by the holders of a majority of the Series 11 Class K Preferred Stock then outstanding. Notwithstanding the above, the number of authorized shares of any class or classes of stock may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of this Section 7.1 or the requirements of Section 242 of the GCL.
7.2 Authorized. Any shares of Series 11 Class K Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:31 PM -- 07/15/1999
991291289 -- 2249849
OF SERIES 12 CLASS L CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 12 Class L Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 12 Class L Convertible Preferred Stock as set forth in the attached resolutions.
Dated: July 15, 1999
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis Centofanti &n bsp;
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 12 CLASS L CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock, par value $.001 per share ("Preferred Stock"), which Preferred Stock may be issued in one or more series by resolutions adopted by the directors, and with the directors being entitled by resolution to fix the number of shares in each series and to designate the rights, designations, preferences and relative, participating, optional or other special rights and privileges, restrictions and conditions attaching to the shares of each such series;
WHEREAS, it is in the best interests of the Corporation for the Board to create a new series from the Preferred Stock designated as the Series 12 Class L Convertible Preferred Stock, par value $.001 per share (the "Series 12 Class L Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 12 Class L Preferred Stock shall consist of nine hundred sixteen (916) shares and no more and shall be designated as the Series 12 Class L Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 12 Class L Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Part 7 hereof or under Section 242(b)(2) of the General Corporation Law of the State of Delaware (the "GCL"), the holders of the Series 12 Class L Preferred Stock shall have no voting rights whatsoever. To the extent that under Section 242(b)(2) of the GCL or Part 7 hereof, the holders of the Series 12 Class L Preferred Stock are entitled to vote on a matter, each share of the Series 12 Class L Preferred Stock shall be entitled one (1) vote for each outstanding share of Series 12 Class L Preferred Stock. Holders of the Series 12 Class L Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 12 Class L Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any shares of the Series 12 Class L Preferred Stock shall be outstanding, the holders of the then outstanding Series 12 Class L Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Corporation's Common Stock equal to $1,000 consideration per outstanding share of Series 12 Class L Preferred Stock, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of such distribution ("Liquidation Preference"), whether or not declared by the Board.
2.2 Payment of Liquidation Preferences. Subject to the provisions of Part 6 hereof, all amounts to be paid as Liquidation Preference to the holders of Series 12 Class L Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of the Corporation's Common Stock, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to the holders of the shares of the Series 12 Class L Preferred Stock of the full Liquidation Preference amounts provided for in this Part 2, the holders of the Series 12 Class L Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 12 Class L Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 12 Class L Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 12 Class L Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 12 Class L Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
Part 3 - Dividends. The holders of the Series 12 Class L Preferred Stock are entitled to receive if, when and as declared by the Board out of funds legally available therefor, cumulative dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), or any combination thereof, at the Corporation's election, at the rate of four percent (4%)
per annum of the Liquidation Value (as defined below) of each issued and outstanding share of Series 12 Class L Preferred Stock (the "Dividend Rate"). The Liquidation Value of the Series 12 Class L Preferred Stock shall be $1,000 per outstanding share of the Series 12 Class L Preferred Stock (the "Liquidation Value"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing June 30, 1998 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 12 Class L Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record of the Series 12 Class L Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from March 1, 1998. In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on an outstanding share of the Series 12 Class L Preferred Stock in Common Stock of the Corporation, the holder of such share shall receive that number of shares of Common Stock of the Corporation equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the average closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid and the denominator of which is 365. Dividends on the Series 12 Class L Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 12 Class L Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 12 Class L Preferred Stock shall have rights to convert the shares of Series 12 Class L Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1 No Right to Convert. The Series 12 Class L Preferred shall not be convertible into shares of Common Stock until after July 15, 2000.
4.2 Right to Convert. The Series 12 Class L Preferred Stock may be convertible into shares of Common Stock at any time after July 15, 2000.
4.3 Conversion Price. Subject to the terms hereof, as used herein, the Conversion Price per outstanding share of Series 12 Class L Preferred Stock shall be $1.8125, except that, in the event the average closing bid price per share of the Common Stock as reported on the over-the-counter
market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days prior to the particular date of conversion shall be less than $2.265, the Conversion Price for only such particular conversion shall be the product of the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately preceding the date of the Conversion Notice referred to in Section 4.3 below in connection with such conversion multiplied by eighty percent (80%), subject to the provisions of this Section 4.3. Notwithstanding the foregoing, the Conversion Price shall not be less than a minimum of $1.50 per share ("Minimum Conversion Price") for a period of twenty-four (24) months from the date of issuance of the Series 12 Class L Preferred Stock. If any of the outstanding shares of Series 12 Class L Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 12 Class L Preferred Stock so surrendered for conversion by (b) the Conversion Price as of such conversion. At the time of conversion of shares of the Series 12 Class L Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of whole shares of Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 12 Class L Preferred Stock so converted divided by the Stock Dividend Price, as defined in Part 3 hereof, in effect at the date of conversion.
4.3 Mechanics of Conversion. Any holder of the Series 12 Class L Preferred Stock who wishes to exercise its Conversion Rights pursuant to Section 4.1 of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 12 Class L Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 12 Class L Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 12 Class L Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been
made only after both the certificate for the shares of Series 12 Class L Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion of the Series 12 Class L Preferred Stock within seven (7) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.3 ("Seven (7) Business Day Period"), then, upon the written demand of RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 12 Class L Preferred Stock, for payment of the penalty described below in this Section 4.3, which demand must be received by the Corporation no later than ten (10) calendar days after the expiration of such Seven (7) Business Day Period, the Corporation shall pay to RBB Bank the following penalty for each business day after the Seven (7) Business Day Period until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion: business day eight (8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day thereafter an amount equal to the penalty due on the immediately preceding business day times two (2) until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion.
4.4 Merger or Consolidation. In case of either (a) any merger or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the Corporation is the surviving or continuing corporation, or (b) any sale or conveyance to another corporation of all, or substantially all, of the assets of the Corporation (collectively, the "Sale"), and such Merger or Sale becomes effective (x) while any shares of Series 12 Class L Preferred Stock are outstanding and prior to the date that the Corporation's Registration Statement covering up to 1,379,311 shares of Common Stock issuable upon the conversion of the Series 12 Class L Preferred Stock is declared effective by the U. S. Securities and Exchange Commission or (y) prior to the end of the restriction periods in Section 4.1, then, in such event, the Corporation or such successor corporation, as the case may be, shall make appropriate provision so that the holder of each share of Series 12 Class L Preferred Stock then outstanding shall have the right to convert such share of
Series 12 Class L Preferred Stock into the kind and amount of shares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number of shares of Common Stock into which such shares of Series 12 Class L Preferred Stock could have been converted into immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Part 4.
4.5 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 12 Class L Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
4.6 Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 12 Class L 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 4.4 hereof), the Conversion Price shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 12 Class L Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 12 Class L Preferred Stock 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 12 Class L Preferred Stock immediately before that change.
4.7 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 12 Class L Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof.
4.8 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and
prepare and furnish to each holder of Series 12 Class L Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.9 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 the Series 12 Class L Preferred Stock pursuant thereto;provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 12 Class L Preferred Stock in connection with such conversion.
4.10 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 12 Class L 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 12 Class L 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 12 Class L Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
4.11 Fractional Shares. No fractional shares shall be issued upon the conversion of any share or shares of Series 12 Class L Preferred Stock. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series 12 Class L 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 fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.12 Notices. Any notices required by the provisions of this Part 4 to be given to the holders of shares of Series 12 Class L Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.
4.13 Business Day. As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or a day when the federal and state banks located in the State of New York are required or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, (i) for a period of 120 days from the date of issuance of the Series 12 Class L Preferred Stock up to an aggregate of 300 shares of the Series 12 Class L Preferred Stock at the cash redemption price of $1,000 per share, and (ii) the then outstanding Series 12 Class L Preferred Stock at the following cash redemption prices if redeemed during the following periods: (a)within one year fromJuly 15, 1999 - $1,100 per share, except as otherwise provided in (i) above and (b) after one year fromJuly 15, 1999 - $1,200 per share (as applicable, the redemption price of $1,000, $1,100 or $1,200 is referred to herein as the "Redemption Price").
5.2 Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 12 Class L Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 12 Class L Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 12 Class L Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 12 Class L Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 12 Class L Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first year from the date of issuance of the Series 12 Class L Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.3 Rights of Conversion Upon Redemption. If the redemption occurs during the first 12 months after the issuance of the Series 12 Class L Preferred Stock, the holder may not convert any redeemed shares. If the redemption occurs after the first twelve months after the first issuance of Series 12 Class L Preferred Stock, then, upon receipt of the Redemption Notice, any holder of Series 12 Class L Preferred Stock shall have five business days during which it may exercise the option, at its sole election, to specify what portion of its Series 12 Class L Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, after one year from the date of first issuance of the Series 12 Class L Preferred Stock, such holder shall have the right to convert into Common Stock that number of Series 12 Class L Preferred Stock called for redemption in the Redemption Notice.
5.4 Surrender of Certificates. On or before the Redemption Date in respect of any Series 12 Class L Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.6 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 12 Class L Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.5 Payment. On the Redemption Date in respect of any Series 12 Class L Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 12 Class L Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 12 Class L Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 12 Class L Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 12 Class L Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 12 Class L Preferred Stock either as to
dividends or upon liquidation, if the holders of such class or classes shall be entitled
to the receipt of dividends or of amounts distributable upon dissolution, liquidation
or winding up of the Corporation, whether voluntary or involuntary, as the case
may be, in preference or priority to the holders of shares of this Series 12 Class L
Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 12 Class L Preferred Stock, either
as to dividends or upon liquidation, whether or not the dividend rates, dividend payment
dates, or redemption or liquidation prices per share or sinking fund provisions, if any,
are different from those of this Series 12 Class L Preferred Stock, if the holders of such
stock are entitled to the receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary,
in proportion to their respective dividend rates or liquidation prices, without preference
or priority, one over the other, as between the holders of such stock and over the other,
as between the holders of such stock and the holders of shares of this Series 12 Class
L Preferred Stock; and,
6.2.3 Junior to shares of this Series 12 Class L Preferred Stock, either as to dividends or
upon liquidation, if such class or series shall be Common Stock or if the holders of shares
of this Series 12 Class L Preferred Stock shall be entitled to receipt of dividends or of
amounts distributable upon dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, as the case may be, in preference or priority to the
holders of shares of such class or series.
Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to the Corporation's Certificate of Incorporation (the "Articles") would alter or change the powers, preferences or special rights of the Series 12 Class L Preferred Stock so as to affect such adversely, then the Corporation must obtain the affirmative vote of such amendment to the Articles at a duly called and held series meeting of the holders of the Series 12 Class L Preferred Stock or written consent by the holders of a majority of the Series 12 Class L Preferred Stock then outstanding. Notwithstanding the above or the provisions of Section 242(b)(2) of the GCL, the number
of authorized shares of any class or classes of stock of the Corporation may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of the provisions of this Section 7.1 or Section 242(b)(2) of the GCL.
7.2 Authorized. Any shares of Series 12 Class L Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:32 PM 07/15/1999
991291291 -- 2249849
OF SERIES 13 CLASS M CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 13 Class M Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 13 Class M Convertible Preferred Stock as set forth in the attached resolutions.
Dated: July 15, 1999
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis F. Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 13 CLASS M CONVERTIBLE PREFERRED STOCK
RE: DESIGNATION OF SERIES 13 CLASS M PREFERRED STOCK.
RESOLVED: That the designations, powers, preferences and rights of the Series 13 Class M Convertible Preferred Stock be, and they hereby are, as set forth below:
1. Number of Shares of Common Stock of Series 13 Class M Convertible Preferred Stock
The Corporation hereby authorizes the issuance of up to two thousand two hundred fifty-two (2,252) shares of Series 13 Class M Convertible Preferred Stock par value $.001 per share (the "Preferred Stock"). This Preferred Stock shall pay an annual dividend based on a 365 day calendar year of 4% of the Liquidation Value (as defined in Section 3 hereof) ("Dividend Rate"), payable semiannually within ten (10) business days after each subsequent June 30th and December 31st (each a "Dividend Declaration Date"), and shall be payable in cash or shares of the Corporation's par value $.001 per share common stock (Common Stock) at the Corporation's option. The first Dividend Declaration Date shall be December 31st, 1998.
In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on the outstanding shares of Preferred Stock in Common Stock of the Corporation, the Holder of each share of Preferred Stock shall receive that number of shares of Common Stock equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of' the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange, the average closing bid price of the Common Stock as quoted on such national exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid, and the denominator of which is 365. Dividends on the Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Preferred Stock shall have been paid or declared and set aside for payment.
2. Voting.
Except as provided under Section 242 of the GCL, holders of Preferred Stock (the "Holders") shall not have the right to vote on any matter. Notwithstanding the provisions of Section 242 of the GCL or Section 4 hereof, the number of authorized shares of any class or classes of stock of the Corporation may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of the provisions of Section 242 of the GCL.
3. Liquidation.
In the event of a voluntary or involuntary dissolution, liquidation, or winding up of the Corporation, the Holders of Preferred Stock shall be entitled to receive out of the assets of the Corporation legally available for distribution to holders of its capital stock, before any payment or distribution shall be made to holders of shares of Common Stock or any other class of stock ranking junior to the Preferred Stock, an amount per share of Preferred Stock equal to $1,000 (the "Liquidation Value") plus any accrued and unpaid dividends on the Preferred Stock. If upon such liquidation, dissolution, or winding up of the Corporation, whether voluntary or involuntary, the assets to be distributed among the Holders of Preferred Stock shall be insufficient to permit payment to the Holders of Preferred Stock of the amount distributable as aforesaid, then the entire assets of the Corporation to be so distributed shall be distributed ratably among the Holders of Preferred Stock and shares of such other classes or series ranking on a parity with the shares of this Preferred Stock in proportion to the full distributable amounts for which holders of all such parity shares are entitled upon such distribution, liquidation, or winding up. Upon any such liquidation, dissolution or winding up of the Corporation, after the Holders of Preferred Stock shall have been paid in full the amounts to which they shall be entitled, the remaining net assets of the Corporation may be distributed to the holders of stock ranking on liquidation junior to the Preferred Stock and the Holders of the Preferred Stock shall have no right or claim to any of the remaining assets of the Corporation. Written notice of such liquidation, dissolution or winding up, stating a payment date, the amount of the liquidation payments and the place where said liquidation payments shall be payable, shall be given by mail, postage prepaid or by telex or facsimile to non-U.S. residents, not less than 10 days prior to the payment date stated therein, to the Holders of record of Preferred Stock, such notice to be addressed to each such Holder at its address as shown by the records of the Corporation. For purposes hereof the shares of Common Stock, shall rank on liquidation junior to the Preferred Stock.
4. Restrictions.
The Corporation will not amend or modify the terms of its Restated Certificate of Incorporation so as to adversely alter or change the Preferred Stock at any time when shares of Preferred Stock are outstanding, without the approval of the Holders of at least a majority of the then outstanding shares of Preferred Stock given inwriting or
by vote at a meeting, consenting or voting (as the case may be) separately as a series, except where the vote or written consent of the Holders of a greater number of shares of Common Stock of the Corporation is required by law or by the Corporation's Certificate of Incorporation, as amended.
5. Optional Conversion.
The Holders of shares of Preferred Stock shall have the following conversion rights to convert the shares of Preferred Stock into shares of Common Stock of the Corporation:
(a) No Right to Convert. The Preferred Stock shall not be convertible into shares of Common Stock until after July 15, 2000.
(b) Conversion Dates. The Preferred Stock may be convertible into shares of Common Stock at any time after July 15, 2000.
(c) Right to Convert; Conversion Price. Subject to the terms hereof, as used herein, the term Conversion Price per outstanding share of Preferred Stock shall be One Dollar and 875/100 ($1.875); except that after the expiration of one hundred and eighty (180) days after the Closing Date if the average of the closing bid price per share of Common Stock quoted on the NASDAQ (or the closing bid price of the Common Stock as quoted on the national securities exchange if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange) for the five (5) trading days immediately prior to the particular date of each Conversion Notice (as defined below) is less than Two Dollars and 34/100 ($2.34), then the Conversion Price for that particular conversion shall be eighty percent (80%) of the average of the closing bid price of the Common Stock on the NASDAQ (or if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange then eighty percent (80%) of the average of the closing bid price of the Common Stock on the national securities exchange) for the five (5) trading days immediately prior to the particular date of the Conversion Notice. Notwithstanding the foregoing, the Conversion Price shall not be less than a minimum of $1.50 per share ("Minimum Conversion Price") for a period of twenty-four (24) months from the date of issuance of the Preferred Stock.
If any of the outstanding shares of Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Section 5(b), the number of shares of whole Common Stock to be issued to the Holder as a result of such conversion shall be determined by dividing (a) the aggregate Stated Value of the Preferred Stock so surrendered for conversion by (b) the Conversion Price in effect on the date of that particular Conversion Notice relating to such conversion. At the time of conversion of shares of the Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon on the shares of Preferred so converted to the date of the Conversion Notice relating to such conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of the Conversion Notice
relating to such conversion of the shares of Preferred Stock so converted divided by the Stock Dividend Price, in effect at the date of the Conversion Notice relating to such conversion.
(c) Conversion Notice. The right of conversion shall be exercised by the Holder thereof by telecopying or faxing an executed and completed written notice signed by an authorized representative of the Holder, ("Conversion Notice") to the Corporation that the Holder elects to convert a specified number of shares of Preferred Stock representing a specified Stated Value thereof into shares of Common Stock and by delivering by express courier the certificate or certificates of Preferred Stock being converted to the Corporation at its principal office (or such other office or agency of the Corporation as the Corporation may designate by notice in writing to the Holders of the Preferred Stock). The business date indicated on a Conversion Notice which is telecopied to and received by the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Conversion Notice shall include therein the Stated Value of shares of Preferred Stock to be converted, and a calculation (a) of the Stock Dividend Price, (b) the Conversion Price, and (c) the number of Shares of Common Stock to be issued in connection with such conversion. The Corporation shall have the right to review the calculations included in the Conversion Notice, and shall provide notice of any discrepancy or dispute therewith within three (3) business days of the receipt thereof. The Holder shall deliver to the Corporation an original Conversion Notice and the original Preferred to be converted within three (3) business days from the date of the Conversion Notice.
(d) Issuance of Certificates - Time Conversion Effected. Promptly, but inno event more than six (6) business days, after the receipt by facsimile of the Conversion Notice referred to in Subparagraph (5)(c); and provided within the six (6) business days the Corporation receives the certificate or certificates for the shares of Preferred Stock to be converted, the Corporation shall issue and deliver, or cause to be issued and delivered, to the Holder, registered in the name of the Holder, a certificate or certificates for the number of whole shares of Common Stock into which such shares of Preferred Stock are converted. Such conversion shall be deemed to have been effected as of the close of business on the date on which the telecopy or facsimile Conversion Notice shall have been received by the Corporation, and the rights of the Holder of such share or shares of Preferred Stock shall cease, at such time, and the Holder or Holders shall be deemed to have become the Holder or Holders of record of the shares of Common Stock represented thereby.
In the event that the shares of Common Stock issuable upon conversion of the Preferred, is not delivered within six (6) business days of the date the Company receives the Conversion Notice, the Company shall pay to the Buyer, by wire transfer, as liquidated damages for such failure and not as a penalty, for each $100,000 of Preferred sought to be converted, $500 for each of the first five (5) calendar days and $1,000 per calendar day thereafter that the shares of Common Stock are not delivered, which liquidated damages shall begin to run from the seventh (7th) business day after the Conversion Date. Any and all payments required pursuant to this paragraph shall be payable only in cash. Notwithstanding the above, liquidated damages shall not exceed $2,000.00 per day. In addition to the liquidated damages set forth herein, in the event the Company fails to deliver the shares of Common Stock within six (6) business days after the Conversion date, the
Company agrees to issue the larger number of shares of Common Stock derived from (i) the original Conversion Notice, or (ii) utilizing the five lowest closing bid prices of the Company's shares of Common Stock beginning on the Conversion Date and ending on the day the shares of Common Stock are delivered. The Company understands that a delay in the issuance of the shares of Common Stock could result in economic loss to the Holder. Nothing contained herein, or in the Preferred shall limit the Holder's rights to pursue actual damages for the Company's failure to issue and deliver shares of Common Stock to the Holder in accordance with the terms of the Certificate of Designations, and this Agreement.
(e) Fractional Shares of Common Stock. No fractional shares of Common Stock shall be issued upon conversion of any Preferred Stock into shares of Common Stock. All fractional shares of Common Stock shall be aggregated and then rounded down to the nearest whole share of Common Stock. In case the number of shares of Preferred Stock represented by the certificate or certificates surrendered pursuant to Subparagraph 5(b) exceeds the number of shares of Common Stock converted, the Corporation shall, upon such conversion, execute and deliver to the Holder, at the expense of the Corporation, a new certificate or certificates for the number of shares of Preferred Stock represented by the certificate or certificates surrendered which are not to be converted.
(f) Merger or Consolidation. In case of either (a) any merger or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the Corporation is the surviving or continuing corporation, or (b) any sale or conveyance to another corporation of all, or substantially all, of the assets of the Corporation (collectively, the "Sale"), and such Merger or Sale becomes effective (x) while any shares of Preferred Stock are outstanding and prior to the date that the Corporation's Registration Statement covering all the shares of Common Stock issuable upon the conversion of the Preferred Stock is declared effective by the U.S. Securities and Exchange Commission ("Commission"), the Corporation or such successor corporation as the case may be, shall make appropriate provision so that the Holder of each share of Preferred Stock then outstanding shall have the right to convert such share of Preferred Stock into the kind and amount of shares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number of shares of Common Stock into which such shares of Preferred Stock could have been converted into immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 5.
In the event of a Merger or Sale, where the Corporation is not the surviving Corporation, the Holder shall have the right to redeem all of the outstanding shares of Preferred Stock at 120% of the Liquidation Value of each share of Preferred Stock then outstanding plus all accrued and unpaid dividends (the "Redemption Amount"). The Corporation shall pay this Redemption Amount in cash within ten (10) business days of receipt by the Corporation of notice from the Holder, and receipt by the Corporation of all outstanding shares of Preferred Stock duly endorsed by the Holder to the Corporation.
(g) Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Preferred Stock are issued and outstanding shall declare or pay, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
(h) Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Preferred Stock shall be changed into the same or a different number of shares of Common Stock of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination or shares of Common Stock provided for in Section 5(g) hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Preferred Stock would otherwise have been entitled to receive, a number of shares of Common Stock 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 Preferred Stock immediately before that change.
6 Redemption.
(a) Redemption at Corporation's Option. Except as otherwise provided in this Section 6, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time (i) for a period of 120 days from the date of issuance of the Preferred Stock up to an aggregate of 450 shares of Series 13 Class M Preferred Stock at the cash redemption price of $1,000 per share and (ii) the then outstanding Series 13 Class M Preferred Stock at the following cash redemption prices if redeemed during the following periods: (a)within one year fromJuly 15, 1999 - $1,100 per share, except as otherwise provided in (i) above, and (b) after one year fromJuly 15, 1999 - $1,200 per share (as applicable, the redemption price of $1,000, $1,100 or $1,200 is referred to herein as the "Redemption Price").
(b) Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 13 Class M Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 13 Class M Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 13 Class M Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 13 Class M Preferred Stock to be redeemed from such holder, and (iv)
instructions as to how to specify to the Corporation the number of Series 13 Class M Preferred Stock to be redeemed as provided in this Part 6 and, if the Redemption Notice is mailed to the Holder after the first year from the date of issuance of the Series 13 Class M Preferred Stock, the number of shares to be converted into Common Stock as provided in Part 5 hereof.
(c) Rights of Conversion Upon Redemption. If the redemption occurs during the first 12 months after the issuance of the Preferred Stock, the holder may not convert any redeemed shares. If the redemption occurs after the first year after the first issuance of Series 13 Class M Preferred Stock, then, upon receipt of the Redemption Notice, any holder of Series 13 Class M Preferred Stock shall have five business days during which it may exercise the option, at its sole election, to specify what portion of its Series 13 Class M Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 6 or converted into Common Stock in the manner provided in Part 5 hereof, except that, notwithstanding any provision of such Part 5 to the contrary, after one year from the date of first issuance of the Preferred Stock, such holder shall have the right to convert into Common Stock that number of Series 13 Class M Preferred Stock called for redemption in the Redemption Notice.
(d) Surrender of Certificates. On or before the Redemption Date in respect of any Series 13 Class M Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 13 Class M Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
(e) Payment. On the Redemption Date in respect of any Series 13 Class M Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 13 Class M Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 13 Class M Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid
to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
7. Assignment.
Subject to all applicable restrictions on transfer, the rights and obligations of the Corporation and the Holder of the Preferred Stock shall be binding upon and benefit the successors, assigns, heirs, administrators, and transferees of the parties.
8. Shares of Common Stock to be Reserved.
The Corporation, upon the effective date of this Certificate of Designations, has a sufficient number of shares of Common Stock available to reserve for issuance upon the conversion of all outstanding shares of Preferred Stock, pursuant to the terms and conditions set forth in Section 5, and exercise of the Warrants as defined in Section 12. The Corporation will at all times reserve and keep available out of its authorized shares of Common Stock, solely for the purpose of issuance upon the conversion of Preferred Stock, and exercise of the Warrants, as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of all outstanding shares of Preferred Stock, and exercise of the Warrants. The Corporation covenants that all shares of Common Stock which shall be so issued shall be duly and validly issued, fully paid and non assessable. The Corporation will take such action as may be required, if the total number of shares of Common Stock issued and issuable after such action upon conversion of the Preferred Stock, and exercise of the Warrants would exceed the total number of shares of Common Stock then authorized by the Corporation's Certificate of Incorporation, as amended, or would exceed 19.99% of the shares of Common Stock then outstanding if required by law or the Rules and Regulations of NASDAQ or the National Securities Exchange applicable to the Corporation to take such action as a result of exceeding such 19.99%, in order to increase the number of shares of Common Stock to permit the Corporation to issue the number of shares of Common Stock required to effect conversion of the Preferred, and exercise of the Warrants, to a number sufficient to permit conversion of the Preferred Stock, and exercise of the Warrants, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to the Corporation's Restated Certificate of Incorporation, and to obtain shareholders approval in order to effect conversion of the Preferred Stock, and exercise of the Warrants, if required by law or the rules or regulations of the NASDAQ or National Securities Exchange applicable to the Corporation.
8(a) Shareholder Approval. In connection with the issuance to the Holder of the shares of Preferred Stock, pursuant to this Certificate of Designations, the Corporation is also issuing (i) certain warrants ("RBB Warrants") to the Holder pursuant to the terms of that certain Private Securities Subscription Agreement dated June 30, 1998 (the "Agreement"), providing for the purchase of up to 150,000 shares of Common Stock at an exercise price of $2.50 per share and (ii) certain warrants (collectively, the "Liviakis Warrants") to Liviakis Financial Communication, Inc. ("Liviakis") and Robert B. Prag providing for the
purchase of up to an aggregate of 2,500,000 shares of Common Stock at an exercise price of $1.875 per share pursuant to the terms of that Liviakis Agreement dated June 30, 1998, between Liviakis and the Corporation.
If (i) the aggregate number of shares of Common Stock issued by the Corporation as a result of any or all of the following: (a) conversion of the Preferred Stock, (b) payment of dividends accrued on the Preferred Stock (c) exercise of the RBB Warrants, and (d) exercise of the Liviakis Warrants exceeds 2,388,347 shares of Common Stock (which equals 19.9% of the outstanding shares of Common Stock of the Corporation as of the date of this Certificate of Designations) and (ii) the Holder has converted or elects to convert any of the then outstanding shares of Preferred Stock pursuant to the terms of Section 5 at a Conversion Price less than $ 1.875 ($1.875 being the market value per share of Common Stock as quoted on the NASDAQ as of the close of business on June 30, 1998) pursuant to the terms of Section 5(b) hereof, other than if the Conversion Price is less than $ 1.875 solely as a result of the anti-dilution provisions of Section 5(g) and (h) hereof, then, notwithstanding anything in Section 5 to the contrary, the Corporation shall not issue any shares of Common Stock as a result of receipt of a Conversion Notice unless and until the Corporation shall have obtained approval of its shareholders entitled to vote on the transactions in accordance with subparagraphs (25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace Rules ("Shareholder Approval").
If Shareholder Approval is required as set forth in the above paragraph, the Corporation shall take all necessary steps to obtain such Shareholder Approval upon receipt of the Conversion Notice triggering the need for Shareholder Approval ("Current Conversion Notice"). If the Corporation has not received from the Holder a Current Conversion Notice, the Holder, subsequent to January 1st, 1999 may, if the Corporation's shares of Common Stock trade, subsequent to January 1st, 1999, at a five (5) day average closing bid price below Two Dollars and 34/00 ($2.34), upon written notice to the Corporation, require the Corporation to obtain Shareholder Approval ("Holder's Notice"). The Holder and the Corporation's officers and directors covenant to vote all shares of Common Stock over which they have voting control in favor of Shareholder Approval. If the Corporation does not obtain Shareholder Approval within ninety (90) days of the earlier of the Corporation's receipt of (i) the Current Conversion Notice or (ii) the Holder's Notice, and the Holder has not breached its covenant to vote all shares of Common Stock over which they have voting control in favor of Shareholder Approval, the Corporation shall pay incash to the Holder liquidated damages, in an amount of 4% per month of the Liquidation Value of each share of Preferred Stock then outstanding, commencing on the 91st day of the Corporation's receipt of the Holder's Current Conversion Notice, and continuing every thirty (30) days pro-rata until such time the Corporation receives Shareholder Approval.
9. No Reissuance of Series 13 Class M Convertible Preferred Stock.
Shares of Preferred Stock which are converted into shares of Common Stock as provided herein shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred stock hereafter created.
10. Closing of Books.
The Corporation will at no time close its transfer books against the transfer of any Preferred Stock or of any shares of Common Stock issued or issuable upon the conversion of any shares of Common Stock of Preferred Stock inany manner which interferes with the timely conversion of such Preferred Stock, except as may otherwise be required to comply with applicable securities laws.
11. No Preemptive Rights.
The Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
12. Definition of Shares.
As used in this Certificate of Designations, the term "shares of Common Stock" shall mean and include the Corporation's authorized common stock, par value $.001, as constituted on the date of filing of these terms of the Preferred Stock, or in case of any reorganization, reclassification, or stock split of the outstanding shares of Common Stock thereof, the stock, securities or assets provided for hereof. The term "Warrants" as used herein shall have the same meaning as defined in Section 1 of the Private Securities Subscription Agreement, dated June 30, 1998, between the Company and RBB Bank Aktiengesellschaft.
The said determination of the designations, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, relating to the Preferred Stock was duly made by the Board of Directors pursuant to the provisions of the Corporation's Restated Certificate of Incorporation and in accordance with the provisions of the Delaware General Corporation Law.
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:33 PM -- 07/15/1999
991291292 -- 2249849
OF
SERIES 3 CLASS C CONVERTIBLE PREFERRED STOCK
AND
SERIES 8 CLASS H CONVERTIBLE PREFERRED STOCK
AND
SERIES 10 CLASS J CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
____________________________________________
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the "Corporation"), hereby certifies the following:
1. That the Certificate of Designations of Series 3 Class C Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 3 Preferred") was filed with the Delaware Secretary of State on July 19, 1996 (the "Series 3 Certificate of Designations").
2. That all outstanding shares of the Series 3 Preferred have been delivered to the Company and exchanged pursuant to an agreement with the holder thereof in accordance with the terms and conditions of a certain Exchange Agreement between the Company and RBB Bank Aktiengesellschaft, dated as of July 15, 1999.
3. That no shares of Series 3 Preferred remain outstanding.
4. That all shares of the Series 3 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
5. That effective July 15, 1999, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 3
Class C Convertible Preferred Stock, no authorized shares of Series 3 Class C
Convertible Preferred Stock will remain outstanding and no shares of Series 3
Class C Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 3 Class C Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 3 Class C Convertible Preferred Stock.
6. That the Certificate of Designations of the Series 8 Class H Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 8 Preferred") was filed on July 16, 1998 (the "Series 8 Certificate of Designations").
7. That all outstanding shares of the Series 8 Preferred have been delivered to the Company and exchanged pursuant to an agreement with the holder thereof in accordance with the terms and conditions of a certain Exchange Agreement between the Company and RBB Bank, dated as of July 15, 1999.
8. That no shares of Series 8 Preferred remain outstanding.
9. That all shares of the Series 8 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
10. That effective July 15, 1999, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 8
Class H Convertible Preferred Stock, no authorized shares of Series 8 Class H
Convertible Preferred Stock will remain outstanding and no shares of Series 8
Class H Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 8 Class H Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 8 Class H Convertible Preferred Stock.
11. That the Certificate of Designations of the Series 10 Class J Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 10 Preferred") was filed on July 10, 1998 (the "Series 10 Certificate of Designations").
12. That all outstanding shares of the Series 10 Preferred have been delivered to the Company and exchanged pursuant to an agreement
with the holder thereof in accordance to the terms and conditions of a certain Exchange Agreement between the Company and RBB Bank, dated as of July 15, 1999.
13. That no shares of Series 10 Preferred remain outstanding.
14. That all shares of the Series 10 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
15. That effective July 15, 1999, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 10
Class J Convertible Preferred Stock, no authorized shares of Series 10 Class J
Convertible Preferred Stock will remain outstanding and no shares of Series 10
Class J Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 10 Class J Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 10 Class J Convertible Preferred Stock.
16. That pursuant to the provisions of Section 151(g) of the Delaware General Corporation Law, upon the effective date of the filing of this Certificate, this Certificate will have the effect of eliminating from the Restated Certificate of Incorporation only those matters set forth in the Restated Certificate of Incorporation with respect to the Series 3 Class C Convertible Preferred Stock, the Series 8 Class H Convertible Preferred Stock, and the Series 10 Class J Convertible Preferred Stock
IN WITNESS WHEREOF, this Certificate of Elimination has been executed this 15th day of July, 1999, by the President of the Company.
PERMA-FIX ENVIRONMENTAL
ATTEST: SERVICES, INC.
/s/ Richard T. Kelecy By /s/ Louis Centofanti
Richard T. Kelecy, Secretary Dr. Louis F. Centofanti, President
(SEAL)
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:30 PM -- 08/10/1999
991331578 -- 2249849
OF SERIES 14 CLASS N CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 14 Class N Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 14 Class N Convertible Preferred Stock as set forth in the attached resolutions.
Dated: August 10, 1999 PERMA-FIX ENVIRONMENTAL
SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 14 CLASS N CONVERTIBLE PREFERRED STOCK
WHEREAS,
A. The Corporation's share capital includes Preferred Stock, par value $.001 per share
("Preferred Stock"), which Preferred Stock may be issued in one or more series by the
Board of Directors of the Corporation (the "Board") being entitled by resolution to fix the
number of shares in each series and to designate the rights, designations, preferences, and
relative, participating, optional or other special rights, privileges, restrictions and conditions
attaching to the shares of each such series; and
B. It is in the best interests of the Corporation for the Board to create a new series from the
Preferred Stock designated as the Series 14 Class N Convertible Preferred Stock, par value $.001.
NOW, THEREFORE, BE IT RESOLVED, THAT:
The Series 14 Class N Convertible Preferred Stock, par value $.001 (the "Series 14 Class N Preferred Stock") of the Corporation shall consist of 1,769 shares and no more and shall be designated as the Series 14 Class N Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 14 Class N Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided herein, in the Corporation's Certificate of Incorporation (the "Articles") or the General Corporation Law of the State of Delaware (the "GCL"), the holders of the Series 14 Class N Preferred Stock shall have no voting rights whatsoever. To the extent that under the GCL the vote of the holders of the Series 14 Class N Preferred Stock, voting separately as a class or series as applicable, is required to authorize a given action of the Corporation, the affirmative vote or consent of the holders of at least a majority of the shares of the Series 14 Class N Preferred Stock represented at a duly held meeting at which a quorum is present or by written consent of a majority of the shares of Series 14 Class N Preferred Stock (except as otherwise may be required under the GCL) shall constitute the approval of such action by the series. To the extent that under the GCL the holders of the Series 14 Class N
Preferred Stock are entitled to vote on a matter with holders of Corporation's Common Stock and/or any other class or series of the Corporation's voting securities, the Series 14 Class N Preferred Stock, the Corporation's Common Stock and all other classes or series of the Corporation's voting securities shall vote together as one class, with each share of Series 14 Class N Preferred Stock entitled to a number of votes equal to the number of shares of the Corporation's Common Stock into which it is then convertible using the record date for the taking of such vote of stockholders as the date as of which the Conversion Price (as defined in Section 4.3 hereof) is calculated and conversion is effected. Holders of the Series 14 Class N Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 14 Class N Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any shares of the Series 14 Class N Preferred Stock shall be outstanding, the holders of the then outstanding Series 14 Class N Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Corporation's Common Stock equal to $1,000 consideration per outstanding share of Series 14 Class N Preferred Stock, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of such distribution ("Liquidation Preference"), whether or not declared by the Board.
2.2 Payment of Liquidation Preferences. Subject to the provisions of Part 6 hereof, all amounts to be paid as Liquidation Preference to the holders of Series 14 Class N Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of the Corporation's Common Stock, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to the holders of the shares of the Series 14 Class N Preferred Stock of the full Liquidation Preference amounts provided for in this Part 2, the holders of the Series 14 Class N Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 14 Class N Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 14 Class N Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 14 Class N Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 14 Class N Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
Part 3 - Dividends.
3.1 The holders of the Series 14 Class N Preferred Stock are entitled to receive if, when and as declared by the Board out of funds legally available therefor, cumulative dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), at the Corporation's election, at the rate of six percent (6%) per annum of the Liquidation Value of the Series 14 Class N Preferred Stock. The Liquidation Value of the Series 14 Class N Preferred Stock shall be $1,000.00 per share (the "Dividend Rate"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing December 31, 1999 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 14 Class N Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from August 3, 1999. In the event that the Corporation elects to pay dividends in Common Stock of the Corporation, each holder of the Series 14 Class N Preferred Stock shall receive shares of Common Stock of the Corporation equal to the quotient of (i) the Dividend Rate in effect on the applicable Dividend Declaration Date dividend by (ii) the average of the closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"). Dividends on the Series 14 Class N Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 14 Class N Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 14 Class N Preferred Stock shall have rights to convert the shares of Series 14 Class N Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1 No Right to Convert. The Series 14 Class N Preferred shall not be convertible into shares of Common Stock until after April 20, 2000.
4.2 Right to Convert. The Series 14 Class N Preferred Stock may be convertible into shares of Common Stock at any time on or after April 20, 2000.
4.3 Conversion Price. As used herein, the term Conversion Price shall be the product of (i) the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately preceding the date of the Conversion Notice referred to in Section 4.4 below multiplied by (ii) seventy-five percent (75%), subject to the provisions of this Section 4.3. Notwithstanding the foregoing, the Conversion Price shall not be (i) less than a minimum of $1.50 per share for a period of twenty-four (24) months from April 20, 1999, or, after twenty-four (24) months from April 20, 1999, a minimum of $.50 per share (as applicable, the "Minimum Conversion Price") or (ii) more than a maximum of $1.50 per share ( "Maximum Conversion Price"). If, after July 1, 1996, the Corporation sustains a net loss, on a consolidated basis, in each of two (2) consecutive quarters, as determined under generally accepted accounting principles, the Minimum Conversion Price shall be reduced $.25 a share, but there shall be no change to, or reduction of, the Maximum Conversion Price. For the purpose of determining whether the Corporation has had a net loss in each of two (2) consecutive quarters, at no time shall a quarter that has already been considered in such determination be considered in any subsequent determination (as an example the third quarter of 1996 in which there is a net profit and the fourth quarter of 1996 in which there is a net loss shall be considered as two consecutive quarters, and, as a result, the fourth quarter of 1996 shall not be considered along with the first quarter of 1997 as two (2) consecutive quarters, but the first quarter of 1997 must be considered with the second quarter of 1997 for the purposes of such determination). For the purposes of this Section 4.3, a "quarter" is a three (3) month period ending on March 31, June 30, September 30, and December 31. If any of the outstanding shares of Series 14 Class N Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 14 Class N Preferred Stock so surrendered for conversion by (b) the Conversion Price in effect at the date of the conversion. At the time of conversion of shares of the Series 14 Class N Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the product of dividing the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 14 Class N Preferred Stock so converted by the Conversion Price in effect at the date of conversion.
4.4 Mechanics of Conversion. Any holder of the Series 14 Class N Preferred Stock who wishes to exercise its Conversion Rights pursuant to the terms of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 14 Class
N Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. No Conversion Notice with respect to any shares of Series 14 Class N Preferred Stock can be given prior to the time such shares of Series 14 Class N Preferred Stock are eligible for conversion in accordance with the provision of Section 4.1 above. Any such premature Conversion Notice shall automatically be null and void. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 14 Class N Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 14 Class N Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of Series 14 Class N Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion within five (5) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.4, the Corporation shall pay to the holder U.S. $1,000 for each day that the Corporation is late in delivering such certificate to the holder or its agent.
4.5 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 14 Class N Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate. If the Corporation shall declare or pay, without consideration, any dividend on the Common Stock payable in any right to acquire Common stock for no consideration, then the Corporation shall be deemed to have made a dividend payable in Common Stock in an amount of shares equal to the maximum number of shares issuable upon exercise of such rights to acquire Common Stock.
4.6. Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 14 Class N 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 4.5 hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 14 Class N Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 14 Class N Preferred Stock 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 14 Class N Preferred Stock immediately before that change.
4.7 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 14 Class N Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof.
4.8 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 14 Class N Preferred Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.9 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 the Series 14 Class N Preferred Stock pursuant thereto;provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 14 Class N Preferred Stock in connection with such conversion.
4.10 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 14 Class N 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 14 Class N 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 14 Class N Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
4.11 Fractional Shares. No fractional share shall be issued upon the conversion of any share or shares of Series 14 Class N Preferred Stock.
ll shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series 14 Class N 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 fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.12 Notices. Any notices required by the provisions of this Part 4 to be given to the holders of shares of Series 14 Class N Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.
4.13 Business Day. As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or a day when the federal and state banks located in the State of New York are required or permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, the then outstanding Series 14 Class N Preferred Stock at the following cash redemption prices if redeemed during the following periods: (i)within twelve (12) months fromApril 20, 1999 - $1,100 per share, and (ii) after twelve (12) months fromApril 20, 1999 - $1,200 per share (as applicable, the redemption price of $1,100 or $1,200 is referred to herein as the "Redemption Price").
5.2 Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 14 Class N Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 14 Class N Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 14 Class N Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 14 Class N Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 14 Class N Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first twelve (12) months from April 20, 1999, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.3 Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 14 Class N Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 14 Class N Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 14 Class N
Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 14 Class N Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 14 Class N Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first 12 months from April 20, 1999, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.4 Rights of Conversion Upon Redemption. If the redemption occurs during the first 12 months after April 20, 1999, the holder may not convert any redeemed shares. If the redemption occurs pursuant to Section 5.1 (i) hereof, the Holder of the Series 14 Class N Preferred Stock shall not have the right to convert those outstanding shares of Series 14 Class N Preferred Stock that the Company is redeeming after receipt of the Redemption Notice. If the redemption occurs pursuant to Section 5.1 (ii) hereof, then, upon receipt of the Redemption Notice, any holder of Series 14 Class N Preferred Stock shall have the next five business days during which it may exercise the option, at its sole election, to specify what portion of its Series 14 Class N Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, after twelve (12) months from April, 20, 1999, such holder shall have the right to convert into Common Stock that number of Series 14 Class N Preferred Stock called for redemption in the Redemption Notice.
5.5 Surrender of Certificates. On or before the Redemption Date in respect of any Series 14 Class N Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.6 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 14 Class N Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.6 Payment. On the Redemption Date in respect of any Series 14 Class N Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least U. S. $50,000,000, as a trust fund, a sum equal to the aggregate First Year Redemption Price or the Redemption Price, whichever is applicable, of all such shares called from redemption (less the aggregate Redemption Price for those Series 14 Class N Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 14 Class N Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares
to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the First Year Redemption Price or the Redemption Price, whichever is applicable, of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the First Year Redemption Price or the Redemption Price, whichever is applicable, in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 14 Class N Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 14 Class N Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 14 Class N Preferred Stock either as to
dividends or upon liquidation, if the holders of such class or classes shall be entitled
to the receipt of dividends or of amounts distributable upon dissolution, liquidation
or winding up of the Corporation, whether voluntary or involuntary, as the case
may be, in preference or priority to the holders of shares of this Series 14 Class N
Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 14 Class N Preferred Stock, either
as to dividends or upon liquidation, whether or not the dividend rates, dividend
payment dates, or redemption or liquidation prices per share or sinking fund
provisions, if any, are different from those of this Series 14 Class N Preferred Stock,
if the holders of such stock are entitled to the receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, in proportion to their respective dividend rates or liquidation
prices, without preference or priority, one over the other, as between the holders
of such stock and over the other, as between the holders of such stock and the
holders of shares of this Series 14 Class N Preferred Stock; and,
6.2.3 Junior to shares of this Series 14 Class N Preferred Stock, either as to dividends or
upon liquidation, if such class or series shall be Common Stock or if the holders of
shares of this Series 14 Class N Preferred Stock shall be entitled to receipt of dividends
or of amounts distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or
involuntary, as the case may be, in preference or priority to the holders of shares of such class or series.
Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to the Corporation's Certificate of Incorporation would alter or change the powers, preferences or special rights of the Series 14 Class N Preferred Stock so as to affect such adversely, then the Corporation must obtain the affirmative vote of such amendment to the Certificate of Incorporation at a duly called and held series meeting of the holders of the Series 14 Class N Preferred Stock or written consent by the holders of a majority of the Series 14 Class N Preferred Stock then outstanding. Notwithstanding the above, the number of authorized shares of any class or classes of stock may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of this Section 7.1 or the requirements of Section 242 of the GCL.
7.2 Authorized. Any shares of Series 14 Class N Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
OF SERIES 15 CLASS O CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 15 Class O Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 15 Class O Convertible Preferred Stock as set forth in the attached resolutions.
Dated: August 10, 1999
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis Centofanti &n bsp;
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
STATE OF DELAAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:31 PM -- 08/10/1999
991331579 -- 22498949
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 15 CLASS O CONVERTIBLE PREFERRED STOCK
WHEREAS, the Corporation's capital includes preferred stock, par value $.001 per share ("Preferred Stock"), which Preferred Stock may be issued in one or more series by resolutions adopted by the directors, and with the directors being entitled by resolution to fix the number of shares in each series and to designate the rights, designations, preferences and relative, participating, optional or other special rights and privileges, restrictions and conditions attaching to the shares of each such series;
WHEREAS, it is in the best interests of the Corporation for the Board to create a new series from the Preferred Stock designated as the Series 15 Class O Convertible Preferred Stock, par value $.001 per share (the "Series 15 Class O Preferred Stock");
NOW, THEREFORE, BE IT RESOLVED, that the Series 15 Class O Preferred Stock shall consist of six hundred sixteen (616) shares and no more and shall be designated as the Series 15 Class O Convertible Preferred Stock, and the preferences, rights, privileges, restrictions and conditions attaching to the Series 15 Class O Preferred Stock shall be as follows:
Part 1 - Voting and Preemptive Rights.
1.1 Voting Rights. Except as otherwise provided in Part 7 hereof or under Section 242(b)(2) of the General Corporation Law of the State of Delaware (the "GCL"), the holders of the Series 15 Class O Preferred Stock shall have no voting rights whatsoever. To the extent that under Section 242(b)(2) of the GCL or Part 7 hereof, the holders of the Series 15 Class O Preferred Stock are entitled to vote on a matter, each share of the Series 15 Class O Preferred Stock shall be entitled one (1) vote for each outstanding share of Series 15 Class O Preferred Stock. Holders of the Series 15 Class O Preferred Stock shall be entitled to notice of (and copies of proxy materials and other information sent to stockholders) for all shareholder meetings or written consents with respect to which they would be entitled to vote, which notice would be provided pursuant to the Corporation's bylaws and applicable statutes.
1.2 No Preemptive Rights. The Series 15 Class O Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
Part 2 - Liquidation Rights.
2.1 Liquidation. If the Corporation shall be voluntarily or involuntarily liquidated, dissolved or wound up at any time when any shares of the Series 15 Class O Preferred Stock shall be outstanding, the holders of the then outstanding Series 15 Class O Preferred Stock shall have a preference in distribution of the Corporation's property available for distribution to the holders of the Corporation's Common Stock equal to $1,000 consideration per outstanding share of Series 15 Class O Preferred Stock, plus an amount equal to all unpaid dividends accrued thereon to the date of payment of such distribution ("Liquidation Preference"), whether or not declared by the Board.
2.2 Payment of Liquidation Preferences. Subject to the provisions of Part 6 hereof, all amounts to be paid as Liquidation Preference to the holders of Series 15 Class O Preferred Stock, as provided in this Part 2, shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any of the Corporation's property to the holders of the Corporation's Common Stock, whether now or hereafter authorized, in connection with such liquidation, dissolution or winding up.
2.3 No Rights After Payment. After the payment to the holders of the shares of the Series 15 Class O Preferred Stock of the full Liquidation Preference amounts provided for in this Part 2, the holders of the Series 15 Class O Preferred Stock as such shall have no right or claim to any of the remaining assets of the Corporation.
2.4 Assets Insufficient to Pay Full Liquidation Preference. In the event that the assets of the Corporation available for distribution to the holders of shares of the Series 15 Class O Preferred Stock upon any dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this Part 2, no such distribution shall be made on account of any shares of any other class or series of Preferred Stock ranking on a parity with the shares of this Series 15 Class O Preferred Stock upon such dissolution, liquidation or winding up unless proportionate distributive amounts shall be paid on account of the shares of this Series 15 Class O Preferred Stock and shares of such other class or series ranking on a parity with the shares of this Series 15 Class O Preferred Stock, ratably, in proportion to the full distributable amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or winding up.
Part 3 - Dividends. The holders of the Series 15 Class O Preferred Stock are entitled to receive if, when and as declared by the Board out of funds legally available therefor, cumulative dividends, payable in cash or Common Stock of the Corporation, par value $.001 per share (the "Common Stock"), or any combination thereof, at the Corporation's election, at the rate of four percent (4%) per
annum of the Liquidation Value (as defined below) of each issued and outstanding share of Series 15 Class O Preferred Stock (the "Dividend Rate"). The Liquidation Value of the Series 15 Class O Preferred Stock shall be $1,000 per outstanding share of the Series 15 Class O Preferred Stock (the "Liquidation Value"). The dividend is payable semi-annually within seven (7) business days after each of December 31 and June 30 of each year, commencing December 31, 1999 (each, a "Dividend Declaration Date"). Dividends shall be paid only with respect to shares of Series 15 Class O Preferred Stock actually issued and outstanding on a Dividend Declaration Date and to holders of record of the Series 15 Class O Preferred Stock as of the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from August 3, 1999. In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on an outstanding share of the Series 15 Class O Preferred Stock in Common Stock of the Corporation, the holder of such share shall receive that number of shares of Common Stock of the Corporation equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or the average closing sale price if listed on a national securities exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid and the denominator of which is 365. Dividends on the Series 15 Class O Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Series 15 Class O Preferred Stock shall have been paid or declared and set aside for payment.
Part 4 - Conversion. The holders of the Series 15 Class O Preferred Stock shall have rights to convert the shares of Series 15 Class O Preferred Stock into shares of the Corporation's Common Stock, par value $.001 per share ("Common Stock"), as follows (the "Conversion Rights"):
4.1 No Right to Convert. The Series 15 Class O Preferred shall not be convertible into shares of Common Stock until after April 20, 2000.
4.2 Right to Convert. The Series 15 Class O Preferred Stock may be convertible into shares of Common Stock at any time after April 20, 2000.
4.3 Conversion Price. Subject to the terms hereof, as used herein, the Conversion Price per outstanding share of Series 15 Class O Preferred Stock shall be $1.8125, except that, in the event the average closing bid price per share of the Common Stock as reported on the over-the-counter market, or
the closing sale price if listed on a national securities exchange, for the five (5) trading days prior to the particular date of conversion shall be less than $2.265, the Conversion Price for only such particular conversion shall be the product of the average closing bid quotation of the Common Stock as reported on the over-the-counter market, or the closing sale price if listed on a national securities exchange, for the five (5) trading days immediately preceding the date of the Conversion Notice referred to in Section 4.4 below in connection with such conversion multiplied by eighty percent (80%), subject to the provisions of this Section 4.2. Notwithstanding the foregoing, the Conversion Price shall not be less than a minimum of $1.50 per share ("Minimum Conversion Price") for a period of twenty-four (24) months from April 20, 1999. If any of the outstanding shares of Series 15 Class O Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Part 4, the number of shares of whole Common Stock to be issued to the holder as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Series 15 Class O Preferred Stock so surrendered for conversion by (b) the Conversion Price as of such conversion. At the time of conversion of shares of the Series 15 Class O Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon to the date of conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of whole shares of Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of conversion on the shares of Series 15 Class O Preferred Stock so converted divided by the Stock Dividend Price, as defined in Part 3 hereof, in effect at the date of conversion.
4.4 Mechanics of Conversion. Any holder of the Series 15 Class O Preferred Stock who wishes to exercise its Conversion Rights pursuant to the terms of this Part 4 must, if such shares are not being held in escrow by the Corporation's attorneys, surrender the certificate therefor at the principal executive office of the Corporation, and give written notice, which may be via facsimile transmission, to the Corporation at such office that it elects to convert the same (the "Conversion Notice"). In the event that the shares of Series 15 Class O Preferred Stock are being held in escrow by the Corporation's attorneys, no delivery of the certificates shall be required. The Corporation shall, within five (5) business days after receipt of an appropriate and timely Conversion Notice (and certificate, if necessary), issue to such holder of Series 15 Class O Preferred Stock or its agent a certificate for the number of shares of Common Stock to which he shall be entitled; it being expressly agreed that until and unless the holder delivers written notice to the Corporation to the contrary, all shares of Common Stock issuable upon conversion of the Series 15 Class O Preferred Stock hereunder are to be delivered by the Corporation to a party designated in writing by the holder in the Conversion Notice for the account of the holder and such shall be deemed valid delivery to the holder of such shares of Common Stock. Such conversion shall be deemed to have been made only after both the certificate for the shares of
Series 15 Class O Preferred Stock to be converted have been surrendered and the Conversion Notice is received by the Corporation (or in the event that no surrender of the Certificate is required, then only upon the receipt by the Corporation of the Conversion Notice) (the "Conversion Documents"), and the person or entity whose name is noted on the certificate evidencing such shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock at and after such time. In the event that the Conversion Notice is sent via facsimile transmission, the Corporation shall be deemed to have received such Conversion Notice on the first business day on which such facsimile Conversion Notice is actually received. If the Corporation fails to deliver to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion of the Series 15 Class O Preferred Stock within seven (7) business days after receipt by the Corporation from the holder of an appropriate and timely Conversion Notice and certificates pursuant to the terms of this Section 4.4 ("Seven (7) Business Day Period"), then, upon the written demand of RBB Bank Aktiengesellschaft ("RBB Bank"), the holder of the Series 15 Class O Preferred Stock, for payment of the penalty described below in this Section 4.4, which demand must be received by the Corporation no later than ten (10) calendar days after the expiration of such Seven (7) Business Day Period, the Corporation shall pay to RBB Bank the following penalty for each business day after the Seven (7) Business Day Period until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion: business day eight (8) - U.S. $1,000; business day nine (9) - U.S. $2,000, and each business day thereafter an amount equal to the penalty due on the immediately preceding business day times two (2) until the Corporation delivers to the holder or its agent the certificate representing the shares of Common Stock that the holder is entitled to receive as a result of such conversion.
4.5 Merger or Consolidation. In case of either (a) any merger or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the Corporation is the surviving or continuing corporation, or (b) any sale or conveyance to another corporation of all, or substantially all, of the assets of the Corporation (collectively, the "Sale"), and such Merger or Sale becomes effective (x) while any shares of Series 15 Class O Preferred Stock are outstanding and prior to the date that the Corporation's Registration Statement covering up to 1,379,311 shares of Common Stock issuable upon the conversion of the Series 15 Class O Preferred Stock is declared effective by the U. S. Securities and Exchange Commission or (y) prior to the end of the restriction periods in Section 4.3, then, in such event, the Corporation or such successor corporation, as the case may be, shall make appropriate provision so that the holder of each share of Series 15 Class O Preferred Stock then outstanding shall have the right to convert such share of Series 15 Class O Preferred Stock into the kind and amount of shares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number
of shares of Common Stock into which such shares of Series 15 Class O Preferred Stock could have been converted into immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Part 4.
4.6 Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Series 15 Class O Preferred Stock are issued and outstanding shall declare or pay, without consideration, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
4.7 Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Series 15 Class O 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 4.6 hereof), the Conversion Price shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Series 15 Class O Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Series 15 Class O Preferred Stock 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 15 Class O Preferred Stock immediately before that change.
4.8 Common Stock Duly Issued. All Common Stock which may be issued upon conversion of Series 15 Class O Preferred Stock will, upon issuance, be duly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof.
4.9 Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of any Conversion Price pursuant to this Part 4, the Corporation, at its expense, within a reasonable period of time, shall compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series 15 Class O Preferred
Stock a notice setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment is based.
4.10 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 the Series 15 Class O Preferred Stock pursuant thereto;provided, however, that the Corporation shall not be obligated to pay any transfer taxes resulting from any transfer requested by any holder of Series 15 Class O Preferred Stock in connection with such conversion.
4.11 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 15 Class O 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 15 Class O 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 15 Class O Preferred Stock, the Corporation will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to its Certificate of Incorporation.
4.12 Fractional Shares. No fractional shares shall be issued upon the conversion of any share or shares of Series 15 Class O Preferred Stock. All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series 15 Class O 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 fractional share of Common Stock, such fractional share shall be rounded up to the nearest whole share.
4.13 Notices. Any notices required by the provisions of this Part 4 to be given to the holders of shares of Series 15 Class O Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing on the books of the Corporation.
4.14 Business Day. As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or a day when the federal and state banks located in the State of New York are required or is permitted to close.
Part 5 - Redemption.
5.1 Redemption at Corporation's Option. Except as otherwise provided in this Section 5.1, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time, the then outstanding Series 15 Class O Preferred Stock at the following cash redemption prices if redeemed during the following periods: (i)within twelve (12) months fromApril 20, 1999 - $1,100 per share and (ii) after twelve (12) months fromApril 20, 1999 - $1,200 per share (as applicable, the redemption price of $1,100 or $1,200 is referred to herein as the "Redemption Price").
5.2 Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 15 Class O Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 15 Class O Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 15 Class O Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 15 Class O Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 15 Class O Preferred Stock to be redeemed as provided in this Part 5 and, if the Redemption Notice is mailed to the Holder after the first twelve (12) months from April 20, 1999, the number of shares to be converted into Common Stock as provided in Part 4 hereof.
5.3 Rights of Conversion Upon Redemption. If the redemption occurs during the first twelve (12) months after April 20, 1999, the holder may not convert any redeemed shares. If the redemption occurs after the first twelve (12) months after April 20, 1999, then, upon receipt of the Redemption Notice, any holder of Series 15 Class O Preferred Stock shall have five business days during which it may exercise the option, at its sole election, to specify what portion of its Series 15 Class O Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 5 or converted into Common Stock in the manner provided in Part 4 hereof, except that, notwithstanding any provision of such Part 4 to the contrary, after twelve (12) months from April 20, 1999, such holder shall have the right to convert into Common Stock that number of Series 15 Class O Preferred Stock called for redemption in the Redemption Notice.
5.4 Surrender of Certificates. On or before the Redemption Date in respect of any Series 15 Class O Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the
Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided in Section 5.5 hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 15 Class O Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
5.5 Payment. On the Redemption Date in respect of any Series 15 Class O Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 15 Class O Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 15 Class O Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
Part 6 - Parity with Other Shares of Series 15 Class O Preferred Stock and Priority.
6.1 Rateable Participation. If any cumulative dividends or return of capital in respect of Series 15 Class O Preferred Stock are not paid in full, the owners of all series of outstanding Preferred Stock shall participate rateably in respect of accumulated dividends and return of capital.
6.2 Ranking. For purposes of this resolution, any stock of any class or series of the Corporation shall be deemed to rank:
6.2.1 Prior or senior to the shares of this Series 15 Class O Preferred Stock either as to
dividends or upon liquidation, if the holders
of such class or classes shall be entitled to the receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in preference or priority to the holders
of shares of this Series 15 Class O Preferred Stock;
6.2.2 On a parity with, or equal to, shares of this Series 15 Class O Preferred Stock, either
as to dividends or upon liquidation, whether or not the dividend rates, dividend payment
dates, or redemption or liquidation prices per share or sinking fund provisions, if any,
are different from those of this Series 15 Class O Preferred Stock, if the holders of such
stock are entitled to the receipt of dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether voluntary or involuntary, in
proportion to their respective dividend rates or liquidation prices, without preference or
priority, one over the other, as between the holders of such stock and over the other, as
between the holders of such stock and the holders of shares of this Series 15 Class O
Preferred Stock; and,
6.2.3 Junior to shares of this Series 15 Class O Preferred Stock, either as to dividends or
upon liquidation, if such class or series shall be Common Stock or if the holders of
shares of this Series 15 Class O Preferred Stock shall be entitled to receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding up of
the Corporation, whether voluntary or involuntary, as the case may be, in preference
or priority to the holders of shares of such class or series.
Part 7 - Amendment and Reissue.
7.1 Amendment. If any proposed amendment to the Corporation's Certificate of Incorporation (the "Articles") would alter or change the powers, preferences or special rights of the Series 15 Class O Preferred Stock so as to affect such adversely, then the Corporation must obtain the affirmative vote of such amendment to the Articles at a duly called and held series meeting of the holders of the Series 15 Class O Preferred Stock or written consent by the holders of a majority of the Series 15 Class O Preferred Stock then outstanding. Notwithstanding the above or the provisions of Section 242(b)(2) of the GCL, the number of authorized shares of any class or classes of stock of the Corporation may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of the provisions of this Section 7.1 or Section 242(b)(2) of the GCL.
7.2 Authorized. Any shares of Series 15 Class O Preferred Stock acquired by the Corporation by reason of purchase, conversion, redemption or otherwise shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred Stock hereafter created.
OF SERIES 16 CLASS P CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 16 Class P Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 16 Class P Convertible Preferred Stock as set forth in the attached resolutions.
Dated: August 10, 1999
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:32 PM -- 08/10/1999
991331580 -- 2249849
(the "Corporation")
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 16 CLASS P CONVERTIBLE PREFERRED STOCK
RE: DESIGNATION OF SERIES 16 CLASS P PREFERRED STOCK.
RESOLVED: That the designations, powers, preferences and rights of the Series 16 Class P Convertible Preferred Stock be, and they hereby are, as set forth below:
1. Number of Shares of Common Stock of Series 16 Class P Convertible Preferred Stock
The Corporation hereby authorizes the issuance of up to one thousand eight hundred two (1,802) shares of Series 16 Class P Convertible Preferred Stock par value $.001 per share (the "Preferred Stock"). This Preferred Stock shall pay an annual dividend based on a 365 day calendar year of 4% of the Liquidation Value (as defined in Section 3 hereof) ("Dividend Rate"), payable semiannually within ten (10) business days after each subsequent June 30th and December 31st (each a "Dividend Declaration Date"), and shall be payable in cash or shares of the Corporation's par value $.001 per share common stock (Common Stock) at the Corporation's option. The first Dividend Declaration Date shall be December 31st, 1999.
In the event that the Corporation elects to pay the accrued dividends due as of a Dividend Declaration Date on the outstanding shares of Preferred Stock in Common Stock of the Corporation, the Holder of each share of Preferred Stock shall receive that number of shares of Common Stock equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of' the closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated Quotation system ("NASDAQ"), or if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange, the average closing bid price of the Common Stock as quoted on such national exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid, and the denominator of which is 365. Dividends on the Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Preferred Stock shall have been paid or declared and set aside for payment.
2. Voting.
Except as provided under Section 242 of the GCL, holders of Preferred Stock (the "Holders") shall not have the right to vote on any matter. Notwithstanding the provisions of Section 242 of the GCL or Section 4 hereof, the number of authorized shares of any class or classes of stock of the Corporation may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of the provisions of Section 242 of the GCL.
3. Liquidation.
In the event of a voluntary or involuntary dissolution, liquidation, or winding up of the Corporation, the Holders of Preferred Stock shall be entitled to receive out of the assets of the Corporation legally available for distribution to holders of its capital stock, before any payment or distribution shall be made to holders of shares of Common Stock or any other class of stock ranking junior to the Preferred Stock, an amount per share of Preferred Stock equal to $1,000 (the "Liquidation Value") plus any accrued and unpaid dividends on the Preferred Stock. If upon such liquidation, dissolution, or winding up of the Corporation, whether voluntary or involuntary, the assets to be distributed among the Holders of Preferred Stock shall be insufficient to permit payment to the Holders of Preferred Stock of the amount distributable as aforesaid, then the entire assets of the Corporation to be so distributed shall be distributed ratably among the Holders of Preferred Stock and shares of such other classes or series ranking on a parity with the shares of this Preferred Stock in proportion to the full distributable amounts for which holders of all such parity shares are entitled upon such distribution, liquidation, or winding up. Upon any such liquidation, dissolution or winding up of the Corporation, after the Holders of Preferred Stock shall have been paid in full the amounts to which they shall be entitled, the remaining net assets of the Corporation may be distributed to the holders of stock ranking on liquidation junior to the Preferred Stock and the Holders of the Preferred Stock shall have no right or claim to any of the remaining assets of the Corporation. Written notice of such liquidation, dissolution or winding up, stating a payment date, the amount of the liquidation payments and the place where said liquidation payments shall be payable, shall be given by mail, postage prepaid or by telex or facsimile to non-U.S. residents, not less than 10 days prior to the payment date stated therein, to the Holders of record of Preferred Stock, such notice to be addressed to each such Holder at its address as shown by the records of the Corporation. For purposes hereof the shares of Common Stock, shall rank on liquidation junior to the Preferred Stock.
4. Restrictions.
The Corporation will not amend or modify the terms of its Restated Certificate of Incorporation so as to adversely alter or change the Preferred Stock at any time when shares of Preferred Stock are outstanding, without the approval of the Holders of at least a majority of the then outstanding shares of Preferred Stock given inwriting or by vote at a meeting, consenting or voting (as the case may be) separately as a series, except where the vote or written consent of the
Holders of a greater number of shares of Common Stock of the Corporation is required by law or by the Corporation's Certificate of Incorporation, as amended.
5. Optional Conversion.
The Holders of shares of Preferred Stock shall have the following conversion rights to convert the shares of Preferred Stock into shares of Common Stock of the Corporation:
(a) No Right to Convert. The Preferred Stock shall not be convertible into shares of Common Stock until after April 20, 2000.
(b) Conversion Dates. The Preferred Stock may be convertible into shares of Common Stock at any time after April 20, 2000.
(c) Right to Convert; Conversion Price. Subject to the terms hereof, as used herein, the term Conversion Price per outstanding share of Preferred Stock shall be One Dollar and 875/100 ($1.875); except that after the expiration of one hundred and eighty (180) days after the Closing Date if the average of the closing bid price per share of Common Stock quoted on the NASDAQ (or the closing bid price of the Common Stock as quoted on the national securities exchange if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange) for the five (5) trading days immediately prior to the particular date of each Conversion Notice (as defined below) is less than Two Dollars and 34/100 ($2.34), then the Conversion Price for that particular conversion shall be eighty percent (80%) of the average of the closing bid price of the Common Stock on the NASDAQ (or if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange then eighty percent (80%) of the average of the closing bid price of the Common Stock on the national securities exchange) for the five (5) trading days immediately prior to the particular date of the Conversion Notice. Notwithstanding the foregoing, the Conversion Price shall not be less than a minimum of $1.50 per share ("Minimum Conversion Price") for a period of twenty-four (24) months from April 20, 1999.
If any of the outstanding shares of Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Section 5(c), the number of shares of whole Common Stock to be issued to the Holder as a result of such conversion shall be determined by dividing (a) the aggregate Stated Value of the Preferred Stock so surrendered for conversion by (b) the Conversion Price in effect on the date of that particular Conversion Notice relating to such conversion. At the time of conversion of shares of the Preferred Stock, the Corporation shall pay in cash to the holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon on the shares of Preferred so converted to the date of the Conversion Notice relating to such conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of the Conversion Notice relating to such conversion of the shares of Preferred Stock so converted divided by the Stock Dividend Price, in effect at the date of the Conversion Notice relating to such conversion.
(d) Conversion Notice. The right of conversion shall be exercised by the Holder thereof by telecopying or faxing an executed and completed written notice signed by an authorized representative of the Holder, ("Conversion Notice") to the Corporation that the Holder elects to convert a specified number of shares of Preferred Stock representing a specified Stated Value thereof into shares of Common Stock and by delivering by express courier the certificate or certificates of Preferred Stock being converted to the Corporation at its principal office (or such other office or agency of the Corporation as the Corporation may designate by notice in writing to the Holders of the Preferred Stock). The business date indicated on a Conversion Notice which is telecopied to and received by the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Conversion Notice shall include therein the Stated Value of shares of Preferred Stock to be converted, and a calculation (a) of the Stock Dividend Price, (b) the Conversion Price, and (c) the number of Shares of Common Stock to be issued in connection with such conversion. The Corporation shall have the right to review the calculations included in the Conversion Notice, and shall provide notice of any discrepancy or dispute therewith within three (3) business days of the receipt thereof. The Holder shall deliver to the Corporation an original Conversion Notice and the original Preferred to be converted within three (3) business days from the date of the Conversion Notice.
(e) Issuance of Certificates - Time Conversion Effected. Promptly, but inno event more than six (6) business days, after the receipt by facsimile of the Conversion Notice referred to in Subparagraph (5)(c); and provided within the six (6) business days the Corporation receives the certificate or certificates for the shares of Preferred Stock to be converted, the Corporation shall issue and deliver, or cause to be issued and delivered, to the Holder, registered in the name of the Holder, a certificate or certificates for the number of whole shares of Common Stock into which such shares of Preferred Stock are converted. Such conversion shall be deemed to have been effected as of the close of business on the date on which the telecopy or facsimile Conversion Notice shall have been received by the Corporation, and the rights of the Holder of such share or shares of Preferred Stock shall cease, at such time, and the Holder or Holders shall be deemed to have become the Holder or Holders of record of the shares of Common Stock represented thereby.
In the event that the shares of Common Stock issuable upon conversion of the Preferred, are not delivered within six (6) business days of the date the Corporation receives the Conversion Notice, the Corporation shall pay to the Holder, by wire transfer, as liquidated damages for such failure and not as a penalty, for each $100,000 of Preferred sought to be converted, $500 for each of the first five (5) calendar days and $1,000 per calendar day thereafter that the shares of Common Stock are not delivered, which liquidated damages shall begin to run from the seventh (7th) business day after the Conversion Date. Any and all payments required pursuant to this paragraph shall be payable only in cash. Notwithstanding the above, liquidated damages shall not exceed $2,000.00 per day. In addition to the liquidated damages set forth herein, in the event the Corporation fails to deliver the shares of Common Stock within six (6) business days after the Conversion date, the Corporation agrees to issue the larger number of shares of Common Stock derived from (i) the original Conversion Notice, or (ii) utilizing the five lowest closing bid prices of the Corporation's shares of Common Stock beginning on the Conversion Date and ending on the day the shares of Common Stock are delivered. The Corporation
understands that a delay in the issuance of the shares of Common Stock could result in economic loss to the Holder. Nothing contained herein, or in the Preferred shall limit the Holder's rights to pursue actual damages for the Corporation's failure to issue and deliver shares of Common Stock to the Holder in accordance with the terms of the Certificate of Designations, and this Agreement.
(f) Fractional Shares of Common Stock. No fractional shares of Common Stock shall be issued upon conversion of any Preferred Stock into shares of Common Stock. All fractional shares of Common Stock shall be aggregated and then rounded down to the nearest whole share of Common Stock. In case the number of shares of Preferred Stock represented by the certificate or certificates surrendered pursuant to Subparagraph 5(d) exceeds the number of shares of Common Stock converted, the Corporation shall, upon such conversion, execute and deliver to the Holder, at the expense of the Corporation, a new certificate or certificates for the number of shares of Preferred Stock represented by the certificate or certificates surrendered which are not to be converted.
(g) Merger or Consolidation. In case of either (a) any merger or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the Corporation is the surviving or continuing corporation, or (b) any sale or conveyance to another corporation of all, or substantially all, of the assets of the Corporation (collectively, the "Sale"), and such Merger or Sale becomes effective while any shares of Preferred Stock are outstanding and prior to the date that the Corporation's Registration Statement covering all the shares of Common Stock issuable upon the conversion of the Preferred Stock is declared effective by the U.S. Securities and Exchange Commission ("Commission"), the Corporation or such successor corporation as the case may be, shall make appropriate provision so that the Holder of each share of Preferred Stock then outstanding shall have the right to convert such share of Preferred Stock into the kind and amount of shares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number of shares of Common Stock into which such shares of Preferred Stock could have been converted into immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 5.
In the event of a Merger or Sale, where the Corporation is not the surviving Corporation, the Holder shall have the right to redeem all of the outstanding shares of Preferred Stock at 120% of the Liquidation Value of each share of Preferred Stock then outstanding plus all accrued and unpaid dividends (the "Redemption Amount"). The Corporation shall pay this Redemption Amount in cash within ten (10) business days of receipt by the Corporation of notice from the Holder, and receipt by the Corporation of all outstanding shares of Preferred Stock duly endorsed by the Holder to the Corporation.
(h) Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time while shares of Preferred Stock are issued and outstanding shall declare or pay, any dividend on the Common Stock payable in Common Stock, or 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 if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
(i) Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Preferred Stock shall be changed into the same or a different number of shares of Common Stock of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination or shares of Common Stock provided for in Section 5(h) hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders of Preferred Stock would otherwise have been entitled to receive, a number of shares of Common Stock 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 Preferred Stock immediately before that change.
6 Redemption.
(a) Redemption at Corporation's Option. Except as otherwise provided in this Section 6, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time the then outstanding Series 16 Class P Preferred Stock at the following cash redemption prices if redeemed during the following periods: (i)within twelve (12) months fromApril 20, 1999 - $1,100 per share, and (ii) after twelve (12) months fromApril 20, 1999 - $1,200 per share (as applicable, the redemption price of $1,100 or $1,200 is referred to herein as the "Redemption Price").
(b) Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Series 16 Class P Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each holder of record on such notice date of the Series 16 Class P Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Series 16 Class P Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Series 16 Class P Preferred Stock to be redeemed from such holder, and (iv) instructions as to how to specify to the Corporation the number of Series 16 Class P Preferred Stock to be redeemed as provided in this Part 6 and, if the Redemption Notice is mailed to the Holder after the first twelve (12) months from April 20, 1999, the number of shares to be converted into Common Stock as provided in Part 5 hereof.
(c) Rights of Conversion Upon Redemption. If the redemption occurs during the first twelve (12) months after April 20, 1999, the holder may not convert any redeemed shares. If the redemption occurs after the first twelve (12) months after April 20, 1999, then, upon receipt of the Redemption Notice, any holder of Series 16 Class P Preferred Stock shall have five business days during which it may exercise the
option, at its sole election, to specify what portion of its Series 16 Class P Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Part 6 or converted into Common Stock in the manner provided in Part 5 hereof, except that, notwithstanding any provision of such Part 5 to the contrary, after twelve (12) months from April 20, 1999, such holder shall have the right to convert into Common Stock that number of Series 16 Class P Preferred Stock called for redemption in the Redemption Notice.
(d) Surrender of Certificates. On or before the Redemption Date in respect of any Series 16 Class P Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Series 16 Class P Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
(e) Payment. On the Redemption Date in respect of any Series 16 Class P Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Series 16 Class P Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Series 16 Class P Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date, the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
7. Assignment.
Subject to all applicable restrictions on transfer, the rights and obligations of the Corporation and the Holder of the Preferred Stock shall be binding upon and benefit the successors, assigns, heirs, administrators, and transferees of the parties.
8. Shares of Common Stock to be Reserved.
The Corporation, upon the effective date of this Certificate of Designations, has a sufficient number of shares of Common Stock available to reserve for issuance upon the conversion of all outstanding shares of Preferred Stock, pursuant to the terms and conditions set forth in Section 5, and exercise of the Warrants as defined in Section 12. The Corporation will at all times reserve and keep available out of its authorized shares of Common Stock, solely for the purpose of issuance upon the conversion of Preferred Stock, and exercise of the Warrants, as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of all outstanding shares of Preferred Stock, and exercise of the Warrants. The Corporation covenants that all shares of Common Stock which shall be so issued shall be duly and validly issued, fully paid and non assessable. The Corporation will take such action as may be required, if the total number of shares of Common Stock issued and issuable after such action upon conversion of the Preferred Stock, and exercise of the Warrants would exceed the total number of shares of Common Stock then authorized by the Corporation's Certificate of Incorporation, as amended, or would exceed 19.99% of the shares of Common Stock then outstanding if required by law or the Rules and Regulations of NASDAQ or the National Securities Exchange applicable to the Corporation to take such action as a result of exceeding such 19.99%, in order to increase the number of shares of Common Stock to permit the Corporation to issue the number of shares of Common Stock required to effect conversion of the Preferred, and exercise of the Warrants, to a number sufficient to permit conversion of the Preferred Stock, and exercise of the Warrants, including, without limitation, engaging in reasonable efforts to obtain the requisite stockholder approval of any necessary amendment to the Corporation's Restated Certificate of Incorporation, and to obtain shareholders approval in order to effect conversion of the Preferred Stock, and exercise of the Warrants, if required by law or the rules or regulations of the NASDAQ or National Securities Exchange applicable to the Corporation.
8(a) Shareholder Approval. In connection with the issuance to the Holder of the shares of Preferred Stock, pursuant to this Certificate of Designations, the Corporation is also issuing (i) certain warrants ("RBB Warrants") to the Holder pursuant to the terms of that certain Private Securities Subscription Agreement dated June 30, 1998 (the "Agreement"), providing for the purchase of up to 150,000 shares of Common Stock at an exercise price of $2.50 per share and (ii) certain warrants (collectively, the "Liviakis Warrants") to Liviakis Financial Communication, Inc. ("Liviakis") and Robert B. Prag providing for the purchase of up to an aggregate of 2,500,000 shares of Common Stock at an exercise price of $1.875 per share pursuant to the terms of that Liviakis Agreement dated June 30, 1998, between Liviakis and the Corporation.
If (i) the aggregate number of shares of Common Stock issued by the Corporation as a result of any or all of the following: (a) conversion of the Preferred Stock, (b) payment of dividends accrued on the Preferred Stock (c) exercise of the RBB Warrants, and (d) exercise of the Liviakis Warrants exceeds 2,388,347 shares of Common Stock (which equals 19.9% of the outstanding shares of Common Stock of the Corporation as of the date of this Certificate of Designations) and (ii) the Holder has converted or elects to convert any of the then outstanding shares of Preferred Stock pursuant to the terms of Section 5 at a Conversion Price less than $ 1.875 ($1.875 being the market
value per share of Common Stock as quoted on the NASDAQ as of the close of business on June 30, 1998) pursuant to the terms of Section 5(c) hereof, other than if the Conversion Price is less than $ 1.875 solely as a result of the anti-dilution provisions of Section 5(h) and (i) hereof, then, notwithstanding anything in Section 5 to the contrary, the Corporation shall not issue any shares of Common Stock as a result of receipt of a Conversion Notice unless and until the Corporation shall have obtained approval of its shareholders entitled to vote on the transactions in accordance with subparagraphs (25)(H)(i)d, (iv) and (v) of Rule 4310 of the NASDAQ Marketplace Rules ("Shareholder Approval").
If Shareholder Approval is required as set forth in the above paragraph, the Corporation shall take all necessary steps to obtain such Shareholder Approval upon receipt of the Conversion Notice triggering the need for Shareholder Approval ("Current Conversion Notice"). If the Corporation has not received from the Holder a Current Conversion Notice, the Holder, subsequent to January 1st, 1999 may, if the Corporation's shares of Common Stock trade, subsequent to January 1st, 1999, at a five (5) day average closing bid price below Two Dollars and 34/00 ($2.34), upon written notice to the Corporation, require the Corporation to obtain Shareholder Approval ("Holder's Notice"). The Holder and the Corporation's officers and directors covenant to vote all shares of Common Stock over which they have voting control in favor of Shareholder Approval. If the Corporation does not obtain Shareholder Approval within ninety (90) days of the earlier of the Corporation's receipt of (i) the Current Conversion Notice or (ii) the Holder's Notice, and the Holder has not breached its covenant to vote all shares of Common Stock over which they have voting control in favor of Shareholder Approval, the Corporation shall pay incash to the Holder liquidated damages, in an amount of 4% per month of the Liquidation Value of each share of Preferred Stock then outstanding, commencing on the 91st day of the Corporation's receipt of the Holder's Current Conversion Notice, and continuing every thirty (30) days pro-rata until such time the Corporation receives Shareholder Approval.
9. No Reissuance of Series 16 Class P Convertible Preferred Stock.
Shares of Preferred Stock which are converted into shares of Common Stock as provided herein shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of Preferred stock hereafter created.
10. Closing of Books.
The Corporation will at no time close its transfer books against the transfer of any Preferred Stock or of any shares of Common Stock issued or issuable upon the conversion of any shares of Common Stock of Preferred Stock inany manner which interferes with the timely conversion of such Preferred Stock, except as may otherwise be required to comply with applicable securities laws.
11. No Preemptive Rights.
The Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
12. Definition of Shares.
As used in this Certificate of Designations, the term "shares of Common Stock" shall mean and include the Corporation's authorized common stock, par value $.001, as constituted on the date of filing of these terms of the Preferred Stock, or in case of any reorganization, reclassification, or stock split of the outstanding shares of Common Stock thereof, the stock, securities or assets provided for hereof. The term "Warrants" as used herein shall have the same meaning as defined in Section 1 of the Private Securities Subscription Agreement, dated June 30, 1998, between the Company and RBB Bank Aktiengesellschaft.
The said determination of the designations, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, relating to the Preferred Stock was duly made by the Board of Directors pursuant to the provisions of the Corporation's Restated Certificate of Incorporation and in accordance with the provisions of the Delaware General Corporation Law.
SERIES 11 CLASS K CONVERTIBLE PREFERRED STOCK
AND
SERIES 12 CLASS L CONVERTIBLE PREFERRED STOCK
AND
SERIES 13 CLASS M CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
____________________________________________
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the "Corporation"), hereby certifies the following:
1. That the Certificate of Designations of Series 11 Class K Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 11 Preferred") was filed with the Delaware Secretary of State on July 15, 1999 (the "Series 11 Certificate of Designations").
2. That all outstanding shares of the Series 11 Preferred have been delivered to the Company and exchanged pursuant to an agreement with the holder thereof in accordance with the terms and conditions of a certain Exchange Agreement between the Company and RBB Bank Aktiengesellschaft, dated as of August 3, 1999.
3. That no shares of Series 11 Preferred remain outstanding.
4. That all shares of the Series 11 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
5. That effective August 3, 1999, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 11
Class K Convertible Preferred Stock, no authorized shares of Series 11 Class K
Convertible Preferred Stock will remain outstanding and no shares of Series 11 Class K
Convertible Preferred Stock will be issued subject to the Certificate of Designations
previously filed with respect to the Series 11 Class K Convertible Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 12:33 PM 08/10/1999
991331581 -- 2249849
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 11 Class K Convertible Preferred Stock.
6. That the Certificate of Designations of the Series 12 Class L Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 12 Preferred") was filed on July 15, 1999 (the "Series 12 Certificate of Designations").
7. That all outstanding shares of the Series 12 Preferred have been delivered to the Company and exchanged pursuant to an agreement with the holder thereof in accordance with the terms and conditions of a certain Exchange Agreement between the Company and RBB Bank, dated as of August 3, 1999.
8. That no shares of Series 12 Preferred remain outstanding.
9. That all shares of the Series 12 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
10. That effective August 3, 1999, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 12
Class L Convertible Preferred Stock, no authorized shares of Series 12 Class L
Convertible Preferred Stock will remain outstanding and no shares of Series 12
Class L Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 12 Class L Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 12 Class L Convertible Preferred Stock.
11. That the Certificate of Designations of the Series 13 Class M Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 13 Preferred") was filed on July 15, 1999 (the "Series 13 Certificate of Designations").
12. That all outstanding shares of the Series 13 Preferred have been delivered to the Company and exchanged pursuant to an agreement with the holder thereof in accordance to the terms and conditions of a certain Exchange Agreement between the Company and RBB Bank, dated as of August 3, 1999.
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13. That no shares of Series 13 Preferred remain outstanding.
14. That all shares of the Series 13 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
15. That effective August 3, 1999, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 13
Class M Convertible Preferred Stock, no authorized shares of Series 13 Class M
Convertible Preferred Stock will remain outstanding and no shares of Series 13
Class M Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 13 Class M Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 13 Class M Convertible Preferred Stock.
16. That pursuant to the provisions of Section 151(g) of the Delaware General Corporation Law, upon the effective date of the filing of this Certificate, this Certificate will have the effect of eliminating from the Restated Certificate of Incorporation only those matters set forth in the Restated Certificate of Incorporation with respect to the Series 11 Class K Convertible Preferred Stock, the Series 12 Class L Convertible Preferred Stock, and the Series 13 Class M Convertible Preferred Stock
IN WITNESS WHEREOF, this Certificate of Elimination has been executed this 10th day of August, 1999, by the President of the Company.
PERMA-FIX ENVIRONMENTAL
ATTEST: SERVICES, INC.
/s/ Richard T. Kelecy By�� /s/ Louis Centofanti
Richard T. Kelecy, Secretary Dr. Louis F. Centofanti, President
(SEAL)
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Page 1
State of Delaware
Office of the Secretary of State
________________________________
I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF DESIGNATION OF "PERMA-FIX ENVIRONMENTAL SERVICES, INC.," FILED IN THIS OFFICE ON THE FOURTEENTH DAY OF JUNE, A.D. 2001, AT 10 O'CLOCK A.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW CASTLE COUNTY RECORDER OF DEEDS.
/s/ Harriet Smith Windsor
Harriet Smith Windsor, Secretary of State
2249849 8100 AUTHENTICATION: 1188603
010285655 DATE: 06-14-01
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 10:00 AM 06/14/2001
010285655 -- 2249849
OF SERIES 17 CLASS Q CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
Perma-Fix Environmental Services, Inc. (the "Corporation"), a corporation organized and existing under the General Corporation Law of the State of Delaware, does hereby certify:
That, pursuant to authority conferred upon by the Board of Directors by the Corporation's Restated Certificate of Incorporation, as amended, and pursuant to the provisions of Section 151 of the Delaware Corporation Law, the Board of Directors of the Corporation has adopted resolutions, a copy of which is attached hereto, establishing and providing for the issuance of a series of Preferred Stock designated as Series 17 Class Q Convertible Preferred Stock and has established and fixed the voting powers, designations, preferences and relative participating, optional and other special rights and qualifications, limitations and restrictions of such Series 17 Class Q Convertible Preferred Stock as set forth in the attached resolutions.
Dated: May 25, 2001.
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
By /s/ Louis Centofanti
Dr. Louis F. Centofanti
Chairman of the Board
ATTEST:
/s/ Richard T. Kelecy
Richard T. Kelecy, Secretary
RESOLUTION OF THE BOARD OF DIRECTORS
FIXING THE NUMBER AND DESIGNATING THE RIGHTS, PRIVILEGES,
RESTRICTIONS AND CONDITIONS ATTACHING TO THE
SERIES 17 CLASS Q CONVERTIBLE PREFERRED STOCK
RE: DESIGNATION OF SERIES 17 CLASS Q CONVERTIBLE PREFERRED STOCK.
RESOLVED: That the designations, powers, preferences and rights of the Series 17 Class Q Convertible Preferred Stock be, and they hereby are, as set forth below:
1. Designation, Number of Shares of Preferred Stock of Series 17 Class Q ConvertiblePreferred Stock and Dividends.
The Corporation hereby authorizes the issuance of up to two thousand five hundred (2,500) shares of Series 17 Class Q Convertible Preferred Stock, par value $.001 per share (the "Preferred Stock"). The holders of the Preferred Stock (individually, the "Holder," and collectively, the "Holders") are entitled to receive if, when and as declared by the Board of Directors of the Corporation (the"Board") out of funds legally available therefore, cumulative dividends at an annual dividend rate, based on a 365 day calendar year, of 5% of the Liquidation Value (as defined in Section 3 hereof) ("Dividend Rate") for each share of the Preferred Stock then issued and outstanding as of the acceptable declaration of such dividend, payable semiannually within ten (10) business days after each subsequent June 30th and December 31st (each a "Dividend Declaration Date"), and shall be payable in cash or shares of the Corporation's common stock, par value $.001 per share ("Common Stock"), at the Corporation's option. The first Dividend Declaration Date shall be December 31st, 2001. Dividends shall be paid only with respect to the shares of Preferred Stock actually issued and outstanding on the Dividend Declaration Date and to Holders of record on the Dividend Declaration Date. Dividends shall accrue from the first day of the semi-annual dividend period in which such dividend may be payable, except with respect to the first semi-annual dividend which shall accrue from the date of the issuance of the Preferred Stock.
In the event that the Board elects to pay the accrued dividends due as of a Dividend Declaration Date on the outstanding shares of Preferred Stock in Common Stock of the Corporation, the Holder of each share of Preferred Stock shall receive that number of shares of Common Stock equal to the product of (a) the quotient of (i) the Dividend Rate divided by (ii) the average of the average closing bid quotation of the Corporation's Common Stock as reported on the National Association of Securities Dealers Automated
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Quotation system ("NASDAQ"), or if the Common Stock is not listed for trading on the NASDAQ but is listed for trading on a national securities exchange, the average closing price of the Common Stock as quoted on such national exchange, for the five (5) trading days immediately prior to the Dividend Declaration Date (the "Stock Dividend Price"), times (b) a fraction, the numerator of which is the number of days elapsed during the period for which the dividend is to be paid, and the denominator of which is 365. Dividends on the Preferred Stock shall be cumulative, and no dividends or other distributions shall be paid or declared or set aside for payment on the Corporation's Common Stock until all accrued and unpaid dividends on all outstanding shares of Preferred Stock shall have been paid or declared and set aside for payment.
2. Voting.
Except as provided under Section 242(2) of the Delaware General Corporation Law ("GCL"), the Preferred Stock shall not have any voting rights and the Holders of the Preferred Stock shall not have the right to vote on any matter. Notwithstanding the provisions of Section 242 of the GCL, the number of authorized shares of any class or classes of stock of the Corporation may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon, voting together as a single class, irrespective of the provisions of Section 242 of the GCL.
3. Liquidation.
In the event of a voluntary or involuntary dissolution, liquidation, or winding up of the Corporation, the Holders of the Preferred Stock shall be entitled to receive out of the assets of the Corporation legally available for distribution to holders of its capital stock, before any payment or distribution shall be made to holders of shares of Common Stock or any other class of stock ranking junior to the Preferred Stock, an amount per share of the Preferred Stock equal to $1,000 (the "Liquidation Value"), plus any accrued and unpaid dividends on the Preferred Stock. If upon such liquidation, dissolution, or winding up of the Corporation, whether voluntary or involuntary, the assets to be distributed among the Holders of the Preferred Stock shall be insufficient to permit payment to the Holders of the Preferred Stock of the amount distributable as aforesaid, then the entire assets of the Corporation to be so distributed shall be distributed ratably among the Holders of the Preferred Stock and shares of such other classes or series ranking on a parity with the shares of the Preferred Stock in proportion to the full distributable amounts for which holders of all such parity shares are entitled upon such distribution, liquidation, or winding up. Upon any such liquidation, dissolution or winding up of the Corporation, after the Holders of Preferred Stock shall have been paid in full the amounts to which they shall be entitled, the remaining net assets of the Corporation may be distributed to the holders of stock ranking on liquidation junior to the Preferred Stock and the Holders of the Preferred Stock shall have no right or claim to any of the remaining assets of the Corporation. Written notice of such liquidation, dissolution or winding up, stating a payment date, the amount of the liquidation payments and the place where said liquidation payments shall be payable, shall be given by mail, postage
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prepaid or by telex or facsimile to non-U.S. residents, not less than 10 days prior to the payment date stated therein, to the Holders of record of the Preferred Stock, such notice to be addressed to each such Holder at its address as shown by the records of the Corporation. For purposes hereof, the shares of Common Stock shall rank on liquidation junior to the Preferred Stock.
4. Optional Conversion.
The Holders of shares of Preferred Stock shall have the following conversion rights to convert the shares of Preferred Stock into shares of Common Stock of the Corporation as follows:
(a) Intentionally left blank.
(b) Right to Convert; Conversion Price. Subject to the terms hereof, as used herein, the term Conversion Price per outstanding share of Preferred Stock shall be One Dollar and 50/100 ($1.50). If any of the outstanding shares of Preferred Stock are converted, in whole or in part, into Common Stock pursuant to the terms of this Section 4, the number of shares of whole Common Stock to be issued as a result of such conversion shall be determined by dividing (a) the aggregate Liquidation Value of the Preferred Stock so surrendered for conversion by (b) the Conversion Price in effect on the date of that particular Conversion Notice relating to such conversion. At the time of conversion of shares of the Preferred Stock, the Corporation shall pay in cash to the Holder thereof an amount equal to all unpaid and accrued dividends, if any, accrued thereon on the shares of the Preferred Stock so converted to the date of the Conversion Notice relating to the shares of Preferred Stock so converted under such conversion, or, at the Corporation's option, in lieu of paying cash for the accrued and unpaid dividends, issue that number of shares of whole Common Stock which is equal to the quotient of the amount of such unpaid and accrued dividends to the date of the Conversion Notice relating to such conversion of the shares of Preferred Stock so converted divided by the Stock Dividend Price in effect at the date of the Conversion Notice relating to such conversion.
(c) Conversion Notice. The right of conversion shall be exercised by the Holder thereof by telecopying or faxing an executed and completed written notice signed by an authorized representative of the Holder ("Conversion Notice"), to the Corporation that the Holder elects to convert a specified number of shares of Preferred Stock representing a specified Liquidation Value thereof into shares of Common Stock and by delivering by express courier the certificate or certificates of Preferred Stock being converted to the Corporation at its principal office (or such other office or agency of the Corporation as the Corporation may designate by notice in writing to the Holders of the Preferred Stock). The business date indicated on a Conversion Notice which is telecopied to and received by the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Conversion Notice shall include therein the Liquidation Value of the shares of Preferred Stock to be converted, and a calculation (a) of the Stock Dividend Price, (b) the Conversion Price, and (c) the number of shares of Common Stock to be issued in connection with such conversion. The Corporation shall have the right to review the calculations included in the Conversion Notice, and shall provide notice of any discrepancy or dispute therewith within five (5) business days of the
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receipt thereof. The Holder shall deliver to the Corporation an original Conversion Notice and the original Preferred to be converted within three (3) business days from the date of the Conversion Notice.
(d) Issuance of Certificates - Time Conversion Effected. Promptly, but inno event more than fifteen (15) business days, after the receipt by facsimile of the Conversion Notice referred to in Section 4(c); and provided within the ten (10) business days the Corporation receives the certificate or certificates for the shares of Preferred Stock to be converted, the Corporation shall issue and deliver, or cause to be issued and delivered, to the Holder, registered in the name of the Holder, a certificate or certificates for the number of whole shares of Common Stock into which such shares of Preferred Stock are converted. Such conversion shall be deemed to have been effected as of the close of business on the date on which the telecopy or facsimile Conversion Notice shall have been received by the Corporation, and the rights of the Holder of such share or shares of Preferred Stock shall cease at such time, and the Holder or Holders shall be deemed to have become the holder or holders of record of the shares of Common Stock represented thereby.
(e) Fractional Shares of Common Stock. No fractional shares of Common Stock shall be issued upon conversion of any Preferred Stock into shares of Common Stock. All fractional shares of Common Stock shall be aggregated and then rounded down to the nearest whole share of Common Stock. In case the number of shares of Preferred Stock represented by the certificate or certificates surrendered pursuant to this Section 4(e) exceeds the number of shares of Common Stock converted, the Corporation shall, upon such conversion, execute and deliver to the Holder, at the expense of the Corporation, a new certificate or certificates for the number of shares of Preferred Stock represented by the certificate or certificates surrendered which are not to be converted.
(f) Merger or Consolidation. In case of either (a) any merger or consolidation to which the Corporation is a party (collectively, the "Merger"), other than a Merger in which the Corporation is the surviving or continuing corporation, or (b) any sale or conveyance to another corporation of all, or substantially all, of the assets of the Corporation (collectively, the "Sale"), and such Merger or Sale becomes effective while any shares of Preferred Stock are outstanding and prior to the date that the Corporation's Registration Statement covering all the Conversion Shares is declared effective by the U. S. Securities and Exchange Commission ("SEC"), the Corporation or such successor corporation as the case may be, shall make appropriate provision so that the Holder of each share of Preferred Stock then outstanding shall have the right to convert such share of Preferred Stock into the kind and amount of shares of stock or other securities and property receivable upon such Merger or Sale by a holder of the number of shares of Common Stock into which such shares of Preferred Stock could have been converted into immediately prior to such Merger or Sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4.
(g) Adjustments to Conversion Price for Stock Dividends and for Combinations or Subdivisions of Common Stock. If the Corporation, at any time or from time to time while shares of Preferred Stock are issued and outstanding, shall declare or pay, any dividend on the Common Stock payable in Common Stock, or shall effect a subdivision of the outstanding shares of Common Stock into a greater number of
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shares of Common Stock (by stock split, reclassification or otherwise than by payment of a dividend in Common Stock), or if 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 Price in effect immediately before such event shall, concurrently with the effectiveness of such event, be proportionately decreased or increased, as appropriate.
(h) Adjustments for Reclassification and Reorganization. If the Common Stock issuable upon conversion of the Preferred Stock shall be changed into the same or a different number of shares of common stock of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination or shares of Common Stock provided for in Section 5(g) hereof), the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted so that the Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the Holders of Preferred Stock would otherwise have been entitled to receive, a number of shares of common stock 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 Preferred Stock immediately before that change.
(i) Other Adjustments to Conversion Price. Except as provided in subsection 4(j), if, after the Closing Date and during the period that any of the Preferred Stock is issued and outstanding, the Corporation shall sell (a) any shares of Common Stock for a consideration per share less than the Conversion Price in effect immediately prior to such sale, or (b) any rights, warrants or other securities entitling the holders thereof to convert such securities into Common Stock at a price per share (determined by dividing (i) the total amount, if any, received or receivable by the Corporation in consideration of the sale of such rights, warrants or other securities plus the total amount, if any, payable to the Corporation upon exercise or conversion thereof by (ii) the number of additional shares of Common Stock issuable upon exercise or conversion of such securities) which is less than the Conversion Price in effect on the date of such sale, the Conversion Price shall be adjusted as of the date of such sale to the amount per share received and to be received by the Corporation in connection with such sale, conversion and exercise as determined above. The Holders may, if approved by the Holders of record representing a majority of the then issued and outstanding shares of Preferred Stock, waive their rights to any adjustment to the Conversion Price in connection with a particular sale covered by this Section 4(i), and, in the event of such waiver, no adjustment to the Conversion Price shall be made under this Section 4(i) as a result of such sale.
(j) No Adjustments. No adjustment in the Conversion Price shall be required in the case of (i) the grant by the Corporation of stock options to employees of the Corporation under a Stock Option Plan approved by the stockholders of the Company or (ii) the issuance of shares of Common Stock upon the exercise of stock options (a) referred to in clause (i) hereof and (b) granted by the Corporation which grant had triggered an adjustment in the Conversion Price.
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5. Redemption.
(a) Redemption at Corporation's Option. Except as otherwise provided in this Section 5, at any time, and from time to time, the Corporation may, at its sole option, but shall not be obligated to, redeem, in whole or in part, at any time, and from time to time the then outstanding Preferred Stock at the following cash redemption prices if redeemed during the following periods: (i)within twelve (12) months from June 1, 2001 - $1,100 per share, and (ii) after June 1, 2002 - $1,200 per share (as applicable, the redemption price of $1,100 or $1,200 is referred to herein as the "Redemption Price").
(b) Mechanics of Redemption. Prior to any date stipulated by the Corporation for the redemption of Preferred Stock (the "Redemption Date"), written notice (the "Redemption Notice") shall be mailed to each Holder of record on such notice date of the Preferred Stock. The Redemption Notice shall state: (i) the Redemption Date of such shares, (ii) the number of Preferred Stock to be redeemed from the holder to whom the Redemption Notice is addressed, (iii) instructions for surrender to the Corporation, in the manner and at the place designated, of a share certificate or share certificates representing the number of Preferred Stock to be redeemed from such Holder, and (iv) instructions as to how to specify to the Corporation the number of Preferred Stock to be redeemed as provided in this Section 5.
(c) Rights of Conversion Upon Redemption. If the redemption occurs, then, upon receipt of the Redemption Notice, any Holder of Preferred Stock shall have five business days during which it may exercise the option, at its sole election, to specify what portion of its Preferred Stock called for redemption in the Redemption Notice shall be redeemed as provided in this Section 5 or converted into Common Stock in the manner provided in Section 4 hereof.
(d) Surrender of Certificates. On or before the Redemption Date in respect of any Preferred Stock, each holder of such shares shall surrender the required certificate or certificates representing such shares to the Corporation in the manner and at the place designated in the Redemption Notice, and upon the Redemption Date, the Redemption Price for such shares shall be made payable, in the manner provided hereof, to the order of the person whose name appears on such certificate or certificates as the owner thereof, and each surrendered share certificate shall be canceled and retired. If a share certificate is surrendered and all the shares evidenced thereby are not being redeemed (as described below), the Corporation shall cause the Preferred Stock which are not being redeemed to be registered in the names of the persons or entity whose names appear as the owners on the respective surrendered share certificates and deliver such certificate to such person.
(e) Payment. On the Redemption Date in respect of any Preferred Stock or prior thereto, the Corporation shall deposit with any bank or trust company having a capital and surplus of at least $50,000,000, as a trust fund, a sum equal to the aggregate Redemption Price of all such shares called from redemption (less the aggregate Redemption Price for those Preferred Stock in respect of which the Corporation has received notice from the holder thereof of its election to convert Preferred Stock into Common Stock), with irrevocable instructions and authority to the bank or trust company to pay, on or after the Redemption Date,
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the Redemption Price to the respective holders upon the surrender of their share certificates. The deposit shall constitute full payment for the shares to their holders, and from and after the date of the deposit the redeemed shares shall be deemed to be no longer outstanding, and holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the rights to receive from the bank or trust company payments of the Redemption Price of the shares, without interest, upon surrender of their certificates thereof. Any funds so deposited and unclaimed at the end of one year following the Redemption Date shall be released or repaid to the Corporation, after which the former holders of shares called for redemption shall be entitled to receive payment of the Redemption Price in respect of their shares only from the Corporation.
6. Assignment.
Subject to all applicable restrictions on transfer, the rights and obligations of the Corporation and the Holder of the Preferred Stock shall be binding upon and benefit the successors, assigns, heirs, administrators, and transferees of the parties.
7. Shares of Common Stock to be Reserved.
The Corporation, upon the effective date of this Certificate of Designations, has a sufficient number of shares of Common Stock available to reserve for issuance upon the conversion of all outstanding shares of Preferred Stock, pursuant to the terms and conditions set forth in Section 4. The Corporation will at all times reserve and keep available out of its authorized shares of Common Stock, solely for the purpose of issuance upon the conversion of Preferred Stock, as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of all outstanding shares of Preferred Stock. The Corporation covenants that all shares of Common Stock which shall be so issued shall be duly and validly issued, fully paid and non assessable. The Corporation will take such action as may be required, if the total number of shares of Common Stock issued and issuable after such action upon conversion of the Preferred Stock would exceed the total number of shares of Common Stock then authorized by the Corporation's Certificate of Incorporation, as amended, in order to increase the number of shares of Common Stock to permit the Corporation to issue the number of shares of Common Stock required to effect conversion of the Preferred Stock, and exercise of the Warrants, to a number sufficient to permit conversion of the Preferred Stock.
8. No Reissuance of Preferred Stock.
Shares of Preferred Stock which are converted into shares of Common Stock as provided herein shall be retired and shall become authorized but unissued shares of Preferred Stock, which may be reissued as part of a new series of preferred stock hereafter created.
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9. Closing of Books.
The Corporation will at no time close its transfer books against the transfer of any Preferred Stock or of any shares of Common Stock issued or issuable upon the conversion of any shares of Common Stock of Preferred Stock inany manner which interferes with the timely conversion of such Preferred Stock, except as may otherwise be required to comply with applicable securities laws.
10. No Preemptive Rights.
The Preferred Stock shall not give its holders any preemptive rights to acquire any other securities issued by the Corporation at any time in the future.
11. Definition of Shares.
As used in this Certificate of Designations, the term "shares of Common Stock" shall mean and include the Corporation's authorized common stock, par value $.001, as constituted on the date of filing of these terms of the Preferred Stock, or in case of any reorganization, reclassification, or stock split of the outstanding shares of Common Stock thereof, the stock, securities or assets provided for hereof.
The said determination of the designations, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, relating to the Preferred Stock was duly made by the Board of Directors pursuant to the provisions of the Corporation's Restated Certificate of Incorporation and in accordance with the provisions of the Delaware General Corporation Law.
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State of Delaware
Office of the Secretary of State
Page 1
I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF
DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY
OF THE CERTIFICATE OF DESIGNATION OF "PERMA-FIX ENVIRONMENTAL
SERVICES, INC.," FILED IN THIS OFFICE ON THE FOURTEENTH DAY OF JUNE,
A.D. 2001, AT 10:01 O'CLOCK A.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE
NEW CASTLE COUNTY RECORDER OF DEEDS.
s/ Harriet Smith Windsor
Harriett Smith Windsor, Secretary of State
Authentication: 1188613
2249849 8100 Date: 06-14-01
010285660
SERIES 14 CLASS N CONVERTIBLE PREFERRED STOCK
AND
SERIES 15 CLASS O CONVERTIBLE PREFERRED STOCK
AND
SERIES 16 CLASS P CONVERTIBLE PREFERRED STOCK
OF
PERMA-FIX ENVIRONMENTAL SERVICES, INC.
____________________________________________
PERMA-FIX ENVIRONMENTAL SERVICES, INC., a corporation organized and existing under the General Corporation Law of the State of Delaware (hereinafter called the "Corporation"), hereby certifies the following:
1. That the Certificate of Designations of Series 14 Class N Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 14 Preferred") was filed with the Delaware Secretary of State on August 10, 1999 (the "Series 14 Certificate of Designations").
2. That a portion of the outstanding shares of the Series 14 Preferred have been converted into common stock of the Corporation and all of the remaining balance have been delivered to the Company and exchanged pursuant to an agreement with the holder thereof in accordance with the terms and conditions of a certain Conversion and Exchange Agreement between the Company and RBB Bank Aktiengesellschaft, dated as of May 25, 2001 ("Exchange Agreement").
3. That no shares of Series 14 Preferred remain outstanding.
4. That all shares of the Series 14 Preferred which have been exchanged have the status of authorized and unissued shares of the preferred stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
5. That effective May 25, 2001, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the conversion and exchange with the holder of the
Series 14 Class N Convertible Preferred Stock, no authorized shares of Series 14
Class N Convertible Preferred Stock will remain outstanding and no shares of Series 14
Class N Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 14 Class N Convertible Preferred
Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to execute
and deliver an appropriate Certificate of Elimination to the Secretary of State of Delaware
regarding the Series 14 Class N Convertible Preferred Stock.
6. That the Certificate of Designations of the Series 15 Class O Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 15 Preferred") was filed on August 10, 1999 (the "Series 15 Certificate of Designations").
7. That all outstanding shares of the Series 15 Preferred have been delivered to the Company and exchanged pursuant to the Exchange Agreement.
8. That no shares of Series 15 Preferred remain outstanding.
9. That all shares of the Series 15 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
10. That effective May 25, 2001, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 15
Class O Convertible Preferred Stock no authorized shares of Series 15 Class O
Convertible Preferred Stock will remain outstanding and no shares of Series 15
Class O Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 15 Class O Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 15 Class O Convertible Preferred Stock.
11. That the Certificate of Designations of the Series 16 Class P Convertible Preferred Stock, par value $.001 per share, of the Corporation (the "Series 16 Preferred") was filed on August 10, 1999 (the "Series 16 Certificate of Designations").
12. That all outstanding shares of the Series 16 Preferred have been delivered to the Company and exchanged pursuant to the Exchange Agreement.
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13. That no shares of Series 16 Preferred remain outstanding.
14. That all shares of the Series 16 Preferred which have been exchanged have the status of authorized and unissued shares of the Preferred Stock of the Corporation without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.
15. That effective May 25, 2001, the Board of Directors of the Company duly adopted the following resolutions:
RESOLVED, that upon completion of the exchange with the holder of the Series 16
Class P Convertible Preferred Stock, no authorized shares of Series 16 Class P
Convertible Preferred Stock will remain outstanding and no shares of Series 16
Class P Convertible Preferred Stock will be issued subject to the Certificate of
Designations previously filed with respect to the Series 16 Class P Convertible
Preferred Stock.
FURTHER RESOLVED, that upon completion of the exchange, the officers of the
Company are hereby authorized and directed, for and on behalf of the Company, to
execute and deliver an appropriate Certificate of Elimination to the Secretary of State
of Delaware regarding the Series 16 Class P Convertible Preferred Stock.
16. That pursuant to the provisions of Section 151(g) of the Delaware General Corporation Law, upon the effective date of the filing of this Certificate, this Certificate will have the effect of eliminating from the Restated Certificate of Incorporation only those matters set forth in the Restated Certificate of Incorporation with respect to the Series 14 Class N Convertible Preferred Stock, the Series 15 Class O Convertible Preferred Stock, and the Series 16 Class P Convertible Preferred Stock
IN WITNESS WHEREOF, this Certificate of Elimination has been executed this 25th day of May, 2001, by the President of the Company.
PERMA-FIX ENVIRONMENTAL
ATTEST: SERVICES, INC.
/s/ Richard T. Kelecy By: /s/ Louis Centofanti
Richard T. Kelecy, Secretary Dr. Louis F. Centofanti, President
(SEAL)
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