State of Delaware
Office of the Secretary of State
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STTATE OF
DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND
CORRECT COPY OF THE CERTIFICATE OF AMENDMENT OF "XCL LTD.",
FILED IN THIS OFFICE ON THE TENTH DAY OF NOVEMBER, A.D.
1997, AT 12 O'CLOCK P.M.
A CERTIFIED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO
THE NEW CASTLE COUNTY RECORDER OF DEEDS FOR RECORDING.
[GREAT SEAL OF THE STATE OF DELAWARE]
/s/ Edward J. Freel
-----------------------------------
Edward J. Freel, Secretary of State
[SEAL OF SECRETARY OF STATE]
2147839 8100 AUTHENTICATION: 8749044
971381726 DATE: 11-10-97
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF DESIGNATION
OF
XCL LTD.
(Pursuant to Section 242 of the General Corporation Law)
____________________________________________
THE UNDERSIGNED, Marsden W. Miller, Jr. and Lisha C. Falk,
being the duly elected Chairman of the Board and Chief
Executive Officer, and Secretary, respectively, of XCL Ltd.,
a Delaware corporation (the "Company"), for the purposes of
amending the Certificate of Designation of the Company's
Series A, Cumulative Convertible Preferred Stock, par value
$1.00 per share (the "Series A Preferred Stock"), as
originally filed on July 6, 1990 with the Secretary of
State of the State of Delaware pursuant to Section 151 of
the General Corporation Law of the State of Delaware
("DGCL"), as amended on December 22, 1992, October 31, 1995,
and April 12, 1996 (the "Certificate of Designation"),
pursuant to Section 242 of the DGCL, DO HEREBY CERTIFY THAT:
FIRST: On June 5, 1997, the Board of Directors of
said Company duly adopted resolutions proposing the
amendment of the terms of the Series A Preferred Stock to
recapitalize and convert such Stock into shares of the
Company's authorized shares of Amended Series A, Cumulative
Convertible Preferred Stock, par value $1.00 per share
("Amended Series A Preferred Stock"), the terms of which are
set forth in that certain Certificate of Designation of the
Amended Series A Preferred Stock, filed on May 19, 1997 with
the Secretary of State of the State of Delaware pursuant to
Section 151 of the DGCL ("Amended Series A Certificate of
Designation"), declaring such amendment and the
corresponding recapitalization and conversion to be in the
best interests of the Company and its shareholders and
authorizing the solicitation of written consents to such
amendment, recapitalization and conversion (collectively,
the "Amendment") from the holders of the Series A Preferred
Stock. The proposed Amendment as summarized in said
resolutions and submitted in summary form to such
stockholders for approval is as follows:
1. Paragraph 1 of the Certification of
Designation is hereby redesignated as Section 1 and
amended to read in its entirety as follows:
"The shares of this series of Preferred Stock
shall be redesignated as "Amended Series A, Cumulative
Convertible Preferred Stock, par value of $1.00 per
share" ("Convertible Preferred Stock" or "Amended
Series A Preferred Stock"). The existing 850,000
authorized shares of Series A, Cumulative Convertible
Preferred Stock, par value $1.00 per share, are hereby
converted into 650,000 shares of Amended Series A
Preferred Stock which shares shall be added to the
existing 1,370,000 previously authorized shares of
Amended Series A, Cumulative Preferred Stock, par value
$1.00 per share, increasing the total number of
authorized shares of such Preferred Stock to 2,020,000
shares. Such number of shares may be decreased, at any
time and from time to time, by resolution of the Board
of Directors; provided, however, that no decrease shall
reduce the number of shares of Convertible Preferred
Stock to a number less than the number of shares then
outstanding. The liquidation value of the Convertible
Preferred Stock shall be $85.00 per share."
2. The remaining terms and provisions of the
Series A Preferred Stock and the corresponding
provisions of the Certificate of Designation are
hereby amended to read in their entirety as set forth
in Exhibit "A" attached hereto and the Amended Series A
Certificate of Designation.
3. The 641,359 issued and outstanding shares
of Series A Preferred Stock are hereby recapitalized
and converted into an aggregate of 611,555 shares of
Amended Series A Preferred Stock on the basis of
0.95353 share of Amended Series A Preferred Stock for
each issued and outstanding share of Series A
Preferred Stock.
SECOND: In lieu of a meeting and vote of the
holders of the Series A Preferred Stock, the holders of
record on the record date, October 10, 1997, of an aggregate
of 569,838 shares of the Series A Preferred Stock, and
exceeding the two-thirds vote required to approve the
Amendment, representing approximately 88.85% of the issued
and outstanding shares of Series A Preferred Stock, gave
their written consent to said Amendment in accordance with
the provisions of Section 228 of the DGCL and the
provisions of Paragraph 9(iii) of the Certificate of
Designation, which written consents have been filed with the
Company as required under said Section 228.
THIRD: Written notice of the approval of the
Amendment has been given to holders of the Series A
Preferred Stock who have not so consented in writing.
FOURTH: Upon filing this Certificate of Amendment
with the Office of the Secretary of State of the State of
Delaware, the authorized but unissued shares of Series A
Preferred Stock authorized pursuant to the Certificate of
Designation and all amendments thereto shall be canceled and
returned to the status of undesignated authorized but
unissued shares of Preferred Stock.
FIFTH: The foregoing Amendment shall become
effective immediately on the date of the filing of this
Certificate of Amendment with the Office of the Secretary of
State of the State of Delaware.
IN WITNESS WHEREOF, the said Corporation has caused
this Certificate of Amendment to be signed and attested by
its officers thereunto duly authorized and its corporate
seal affixed this 10th day of November, 1997.
/s/ Marsden W. Miller, Jr.
__________________________________
Marsden W. Miller, Jr.
Chairman of the Board and
Chief Executive Officer
ATTEST:
/s/ Lisha C. Falk
_____________________
Lisha C. Falk
Secretary
STATE OF LOUISIANA
PARISH OF LAFAYETTE
BE IT REMEMBERED that on this 10th day of November
1997, personally came before me, a Notary Public for the
State of Louisiana, Parish of Lafayette, Marsden W. Miller,
Jr., who acknowledged himself to be the Chairman of the
Board and Chief Executive Officer of XCL Ltd., a Delaware
corporation, and that he, as such Chairman of the Board and
Chief Executive Officer, being authorized so to do, executed
the foregoing Amendment to the Certificate of Incorporation,
and acknowledged the same to be his act and deed and the act
and deed of the corporation, and that the facts therein
stated are true.
GIVEN under my hand and seal of office the day and year
aforesaid.
/s/ Benjamin B. Blanchet
________________________
Notary Public
My Commission Expires:
With Life
_________________________
EXHIBIT A
XCL LTD.
DESIGNATION OF AMENDED SERIES A, CUMULATIVE CONVERTIBLE
PREFERRED STOCK
The Corporation shall have the authority to issue up to
2,020,000 shares of Preferred Stock, which shall be
designated Amended Series A, Cumulative Convertible
Preferred Stock (the "Amended Series A Preferred Stock"),
each share of Amended Series A Preferred Stock being
identical with each other share of Amended Series A
Preferred Stock and all shares of Amended Series A Preferred
Stock having the following characteristics, rights and
preferences:
Section 2. Dividends.
(a) Amount. The holders of Convertible Preferred
Stock shall be entitled to receive, when, as and if declared
by the Board of Directors, out of funds legally available
for the payment of dividends, dividends at the rate of
$8.075 per share per annum, and no more, payable semi-
annually, on May 1, and November 1 in each year, commencing
November 1, 1997, except that if such date is not a business
day then such dividend shall be payable on the next
succeeding business day (the "Dividend Payment Date" or
"Dividend Payment Dates") (as used herein, the term
"business day" shall mean any day except a Saturday, Sunday
or day on which banking institutions are authorized or
required by law to close in New York City or in the City of
Lafayette, Louisiana). Such dividends shall be cumulative
(whether or not declared) and shall accrue, without
interest, from the first day in which such dividend may be
payable as provided herein, except that with respect to the
first semi-annual dividend, such dividend shall accrue from
the date of issuance of such shares of Convertible Preferred
Stock (the "Issue Date"). Dividends shall be payable to
holders of record as they appear on the share transfer
records of the Corporation on such record dates as may be
fixed by the Board of Directors, not more than sixty (60)
days nor less than ten (10) days preceding such Dividend
Payment Date. Dividends in arrears may be declared and paid
at any time, without reference to any regular Dividend
Payment Date, to holders of record on such date, not more
than sixty (60) days preceding the payment date thereof, as
may be fixed by the Board of Directors of the Corporation.
The amount of dividends payable on shares of Convertible
Preferred Stock for each full semi-annual dividend period
(the "Semi-Annual Dividend"), shall be computed by dividing
by two the annual rate per share set forth in this
subsection (a). During the period commencing on the Issue
Date to and including the Dividend Payment Date on
November 1, 2000, dividends shall be paid in additional
fully paid and nonassessable shares of Convertible Preferred
Stock (the "Preferred Dividend Stock"), and, thereafter,
dividends shall be paid in cash, or, at the sole election of
the Corporation, in shares of Preferred Dividend Stock. The
amount of Preferred Dividend Stock payable on the
Convertible Preferred Stock for each semi-annual dividend
period shall be computed by dividing the amount of the full
Semi-Annual Dividend by eighty-five (85). No fractional
shares of Preferred Dividend Stock shall be issued by the
Corporation. Instead of any fractional share of Preferred
Dividend Stock that would otherwise be issuable to a holder
by way of a dividend on the Convertible Preferred Stock, the
Corporation shall either (i) pay a cash adjustment in
respect of such fractional share in an amount equal to the
same fraction of $85.00 computed to the nearest whole cent
or (ii) aggregate all such fractional shares into a whole
number of shares and sell such aggregated fractional shares
on behalf of the holders entitled thereto in a public or
private sale and distribute the net cash proceeds from the
sale thereof to such holders pro rata. If the Corporation
shall elect so to aggregate and sell such fractional shares,
it shall endeavor to use its best efforts to secure the best
available sales price for such shares but shall not be
obligated to secure the highest price obtainable for such
shares. The amount of Preferred Dividend Stock issuable to
a holder by way of a dividend shall be computed on the basis
of the aggregate number of shares of Convertible Preferred
Stock registered in such holder's name on the record date
fixed for the payment of such dividend. Dividends payable
on the Convertible Preferred Stock for any period less than
a full semi-annual period shall be computed on the basis of
a 360-day year of twelve 30-day months.
(b) Priority. If dividends upon any shares of
Convertible Preferred Stock, or any other outstanding class
or series of Stock of the Corporation ranking on a parity
with the Convertible Preferred Stock as to dividends, are in
arrears, all dividends or other distributions declared upon
each class or series of such Stock (other than dividends
paid in Stock of the Corporation ranking junior to the
Convertible Preferred Stock as to dividends and upon
liquidation, dissolution or winding up) may only be declared
pro rata so that in all cases the amount of dividends or
other distributions declared per share on the Convertible
Preferred Stock and such class or series bear to each other
the same ratio that the accrued and unpaid dividends per
share on the shares of the Convertible Preferred Stock and
such class or series bear to each other. Except as set
forth above, if dividends upon any shares of Convertible
Preferred Stock are in arrears: (i) no dividends (in cash,
Stock or other property) may be paid, declared or set aside
for payment or any other distribution made on any Stock of
the Corporation ranking junior to the Convertible Preferred
Stock as to dividends (other than dividends or distributions
in Stock of the Corporation ranking junior to the
Convertible Preferred Stock as to dividends and upon
liquidation, dissolution or winding up) and upon
liquidation, dissolution or winding up; and (ii) no Stock of
the Corporation ranking junior to or on a parity with the
Convertible Preferred Stock as to dividends may be redeemed,
purchased or otherwise acquired by the Corporation, except
by conversion of such Stock into, or exchange of such Stock
for, Stock of the Corporation ranking junior to the
Convertible Preferred Stock as to dividends and upon
liquidation, dissolution or winding up.
(c) No Interest. No interest, sum of money in lieu
of interest, or other property or securities shall be
payable in respect of any dividend payment or payments which
are accrued but unpaid. Dividends paid on shares of
Convertible Preferred Stock in an amount less than the total
amount of such dividends at the time accumulated and payable
on such shares shall be allocated pro rata on a share-by-
share basis among all such shares at the time outstanding.
Section 3. Conversion Privilege.
(a) Right of Conversion. At any time on or after
May 20, 1998 (the "Conversion Date"), each share of
Convertible Preferred Stock shall be convertible at the
option of the holder thereof into fully paid and
nonassessable shares of Common Stock ("Conversion Stock"),
at a conversion rate per full share of Convertible Preferred
Stock determined by dividing $85.00 by the conversion price
per share of Common Stock in effect on the date such share
is surrendered for conversion, or into such additional or
other securities, cash or property and at such other rates
as required in accordance with the provisions of this
Section 3, except that if shares have been called for
redemption, the conversion right will terminate as to the
shares called for redemption at 5:00 p.m. New York City
time, on the business day prior to the date fixed for such
redemption. For purposes of this resolution, the
"conversion price" per share of Convertible Preferred Stock
shall initially be $0.50 and shall be adjusted from time to
time in accordance with the provisions of this Section 3.
For purposes of this resolution, the "conversion rate" per
share of Convertible Preferred Stock shall initially be
170 shares of Conversion Stock and shall be adjusted from
time to time in accordance with the provisions of this
Section 3. Each share of Convertible Preferred Stock may be
converted in whole or in part.
(b) Conversion Procedures. Any holder of shares of
Convertible Preferred Stock desiring to convert such shares
into Common Stock shall surrender the certificate or
certificates evidencing such shares of Convertible Preferred
Stock at the office of the transfer agent for the
Convertible Preferred Stock, which certificate or
certificates, if the Corporation shall so require, shall be
duly endorsed to the Corporation or in blank, or accompanied
by proper instruments of transfer to the Corporation or in
blank, accompanied by irrevocable written notice to the
Corporation that the holder elects to convert such shares of
Convertible Preferred Stock and specifying the name or names
(with address or addresses) in which a certificate or
certificates evidencing shares of Common Stock are to be
issued.
Except as otherwise described in Section 3(i) or in
this paragraph, no payments or adjustments in respect of
dividends on shares of Convertible Preferred Stock
surrendered for conversion, whether paid or unpaid and
whether or not in arrears, or on account of any dividend on
the Conversion Stock issued upon conversion shall be made by
the Corporation upon the conversion of any shares of
Convertible Preferred Stock at the option of the holder,
including, without limitation, the special conversion rights
provided in Section 4. The holder of record of shares of
Convertible Preferred Stock on a dividend record date who
surrenders such shares for conversion during the period
between such dividend record date and the corresponding
Dividend Payment Date will be entitled to receive the
dividend on such Dividend Payment Date notwithstanding the
conversion of such shares; provided, however, that unless
such shares, prior to such surrender, had been called for
redemption on a redemption date during the period between
such dividend record date and the Dividend Payment Date,
such shares must be accompanied, upon surrender for
conversion, by payment from the holder to the Corporation of
an amount equal to the dividend payable on such shares on
that Dividend Payment Date.
The Corporation shall, as soon as practicable after
such surrender of certificates evidencing shares of
Convertible Preferred Stock accompanied by the written
notice and compliance with any other conditions herein
contained, delivered at such office of such transfer agent
to the person for whose account such shares of Convertible
Preferred Stock were so surrendered, or to the nominee or
nominees of such person, certificates evidencing the number
of full shares of Common Stock to which such person shall be
entitled as aforesaid, together with a cash adjustment in
respect of any fraction of a share of Common Stock as
hereinafter provided. Such conversion shall be deemed to
have been made as of the date of such surrender of the
shares of Convertible Preferred Stock to be converted, and
the person or persons entitled to receive the Common Stock
deliverable upon conversion of such Convertible Preferred
Stock shall be treated for all purposes as the record holder
or holders of such Common Stock on such date.
(c) Adjustment of Conversion Price and Conversion
Rate. The conversion price at which a share of Convertible
Preferred Stock is convertible into Common Stock, and the
conversion rate at which shares of Conversion Stock are
issuable upon conversion of Convertible Preferred Stock,
shall be subject to adjustment in certain events including,
without duplication, the following:
(i) In case the Corporation shall pay or make
a dividend or other distribution on its Common Stock
exclusively in Common Stock to all holders of its
Common Stock, the conversion price in effect at the
opening of business on the business day following the
date fixed for the determination of stockholders
entitled to receive such dividend or other distribution
shall be reduced by multiplying such conversion price
by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding at the
close of business on the date fixed for such
determination and the denominator shall be the sum of
such number of shares and the total number of shares
constituting or included in such dividend or other
distribution, such reduction to become effective
immediately after the opening of business on the day
following the date fixed for such determination. For
the purposes of this paragraph (i), the number of
shares of Common Stock at any time outstanding shall
not include shares held in the treasury of the
Corporation. The Corporation shall not pay any
dividend or make any distribution on shares of Common
Stock held in the treasury of the Corporation.
(ii) In case the Corporation shall pay or make
a dividend or other distribution on its Common Stock
consisting exclusively of, or shall otherwise issue to
all holders of its Common Stock, rights or warrants
entitling the holders thereof to subscribe for or
purchase shares of Common Stock at a price per share
less than the Market Price per share (determined as
provided in paragraph (vi) of this Section 3(c)) of the
Common Stock on the date fixed for the determination of
stockholders entitled to receive such rights or
warrants, the conversion price in effect at the opening
of business on the day following the date fixed for
such determination shall be reduced by multiplying such
conversion price by a fraction of which the numerator
shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed
for such determination plus the number of shares of
Common Stock which the aggregate of the offering price
of the total number of shares of Common Stock so
offered for subscription or purchase would purchase at
such Market Price and the denominator shall be the
number of shares of Common Stock outstanding at the
close of business on the date fixed for such
determination plus the number of shares of Common Stock
so offered for subscription or purchase, such reduction
to become effective immediately after the opening of
business on the day following the date fixed for such
determination. In case any rights or warrants referred
to in this paragraph (ii) in respect of which an
adjustment shall have been made shall expire
unexercised, the conversion price shall be readjusted
at the time of such expiration to the conversion price
that would have been in effect if no adjustment had
been made on account of the distribution or issuance of
such expired rights or warrants.
(iii) In case outstanding shares of Common
Stock shall be subdivided into a greater number of
shares of Common Stock, the conversion price in effect
at the opening of business on the day following the day
upon which such subdivision becomes effective shall be
proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall each be
combined into a smaller number of shares of Common
Stock, the conversion price in effect at the opening of
business on the day following the day upon which such
combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may
be, to become effective immediately after the opening
of business on the day following the day upon which
such subdivision or combination becomes effective.
(iv) Subject to the last sentence of this
paragraph (iv), in case the Corporation shall, by
dividend or otherwise, distribute to all holders of its
Common Stock evidences of its indebtedness, shares of
any class or series of capital stock, cash or assets
(including securities, but excluding any rights or
warrants referred to in paragraph (ii) of this
Section 3(c), any dividend or distribution paid
exclusively in cash and any dividend or distribution
referred to in paragraph (i) of this Section 3(c)), the
conversion price in effect on the day following the
date fixed for the payment of such distribution (the
date fixed for payment being referred to as the
"Reference Date") shall be reduced by multiplying such
conversion price by a fraction of which the numerator
shall be the Market Price per share (determined as
provided in paragraph (vi) of this Section 3(c)) of the
Common Stock on the Reference Date less the fair market
value (as determined in good faith by the Board of
Directors, whose determination shall be conclusive and
described in a resolution of the Board of Directors) on
the Reference Date of the portion of the evidences of
indebtedness, shares of capital stock, cash and assets
so distributed applicable to one share of Common Stock,
and the denominator shall be such Market Price per
share of the Common Stock, such reduction to become
effective immediately prior to the opening of business
on the day following the Reference Date. If the Board
of Directors determines the fair market value of any
distribution for purposes of this paragraph (iv) by
reference to the actual or when issued trading market
for any securities comprising such distribution, it
must in doing so consider the prices in such market
over the same period used in computing the Market Price
per share of Common Stock pursuant to paragraph (vi) of
this Section 3(c). For purposes of this paragraph
(iv), any dividend or distribution that includes shares
of Common Stock or rights or warrants to subscribe for
or purchase shares of Common Stock shall be deemed to
be (A) a dividend or distribution of the evidences of
indebtedness, cash, assets or shares of capital stock
other than such shares of Common Stock or rights or
warrants (making any conversion price reduction
required by this paragraph (iv)) immediately followed
by (B) a dividend or distribution of such shares of
Common Stock or such rights or warrants (making any
further conversion price reduction required by
paragraph (i) or (ii) of this Section 3(c)), except (1)
the Reference Date of such dividend or distribution as
defined in this paragraph (iv) shall be substituted as
"the date fixed for the determination of stockholders
entitled to receive such dividend or other
distribution," "the date fixed for the determination of
stockholders entitled to receive such rights or
warrants" and "the date fixed for such determination"
within the meaning of paragraphs (i) and (ii) of this
Section 3(c) and (2) any shares of Common Stock
included in such dividend or distribution shall not be
deemed "outstanding at the close of business on the
date fixed for such determination" within the meaning
of paragraph (i) of this Section 3(c).
(v) In case the Corporation shall pay or make
a dividend or other distribution on its Common Stock in
cash (excluding (A) cash that is part of a distribution
referred to in paragraph (iv) above and (B) in the case
of any quarterly cash dividend on the Common Stock, the
portion thereof that does not exceed the per share
amount of the next preceding quarterly cash dividend on
the Common Stock (as adjusted to appropriately reflect
any of the events referred to in paragraphs (i), (ii),
(iii), (iv) and (v) of this Section 3(c)), or all of
such quarterly cash dividend if the amount thereof per
share of Common Stock multiplied by four does not
exceed 15% of the Market Price per share (determined as
provided in paragraph (vi) of this Section 3(c)) of the
Common Stock as of the trading day next preceding the
date of declaration of such dividend, the conversion
price in effect immediately prior to the opening of
business on the day following the date fixed for the
payment for such distribution shall be reduced by
multiplying such conversion price by a fraction of
which the numerator shall be the Market Price per share
(determined as provided in paragraph (vi) of this
Section 3(c)) of the Common Stock on the date fixed for
the payment of such distribution less the amount of
cash so distributed and not excluded as provided above
applicable to one share of Common Stock, and the
denominator of which shall be such Market Price per
share of the Common Stock, such reduction to become
effective immediately prior to the opening of business
on the day following the date fixed for the payment of
such distribution.
(vi) For the purpose of any computation under
paragraph (ii), (iii), (iv) or (v) of this Section 3(c)
or Section 3(d), the Market Price per share of Common
Stock on any date shall be deemed to be the average of
the Market Prices for the five consecutive trading days
ending with and including the date in question;
provided, however, that (A) if the "ex" date (as
hereinafter defined) for any event (other than the
issuance or distribution requiring such computation)
that requires an adjustment to the conversion price
pursuant to paragraph (i), (ii), (iii), (iv) or (v)
above ("Other Event") occurs after the fifth trading
day prior to the date in question and prior to the "ex"
date for the issuance or distribution requiring such
computation (the "Current Event"), the Market Price for
each trading day prior to the "ex" date for such Other
Event shall be adjusted by multiplying such Market
Price by the same fraction by which the conversion
price is so required to be adjusted as a result of such
Other Event, (B) if the "ex" date for any Other Event
occurs after the "ex" date for the Current Event and on
or prior to the date in question, the Market Price for
each trading day on and after the "ex" date for such
Other Event shall be adjusted by multiplying such
Market Price by the reciprocal of the fraction by which
the conversion price is so required to be adjusted as a
result of such Other Event, (C) if the "ex" date for
any Other Event occurs on the "ex" date for the Current
Event, one of those events shall be deemed for purposes
of clauses (A) and (B) of this proviso to have an "ex"
date occurring prior to the "ex" date for the other
event, and (D) if the "ex" date for the Current Event
is on or prior to the date in question, after taking
into account any adjustment required pursuant to
clause (B) of this proviso, the Market Price for each
trading day on or after such "ex" date shall be
adjusted by adding thereto the amount of any cash and
the fair market value on the date in question (as
determined in good faith by the Board of Directors in a
manner consistent with any determination of such value
for purposes of paragraph (iv) or (v) of this
Section 3(c), whose determination shall be conclusive
and described in a resolution of the Board of
Directors) of the portion of the rights, warrants,
evidences of indebtedness, shares of capital stock or
assets being distributed applicable to one share of
Common Stock. For purposes of this paragraph, the term
"ex" date, (1) when used with respect to any issuance
or distribution, means the first date on which the
Common Stock trades regular way on the relevant
exchanges or in the relevant market from which the
Market Price was obtained without the right to receive
such issuance or distribution and (2) when used with
respect to any subdivision or combination of shares of
Common Stock, means the first date on which the Common
Stock trades regular way on such exchange or in such
market after the time at which such subdivision or
combination becomes effective. As used in this
Section 3(c) or in Section 3(d), the term "Market
Price" of the Common Stock for any day means the last
reported sale price, regular way, on such day, or, if
no sale takes place on such day, the average of the
reported closing bid and asked prices on such day,
regular way, in either case reported on the American
Stock Exchange ("AMEX") Consolidated Transaction Tape,
or, if the Common Stock is not listed or admitted to
trading on the AMEX on such day, on the principal
national securities exchange on which the Common Stock
is listed or admitted to trading, if the Common Stock
is listed on a national securities exchange, or the
National Market Tier of The Nasdaq Stock Market
("Nasdaq NMS") or, if not listed or admitted to trading
on such quotation system, on the principal quotation
system on which the Common Stock may be listed or
admitted to trading or quoted or, if not listed or
admitted to trading or quoted on any national
securities exchange or quotation system, the average of
the closing bid and asked prices of the Common Stock in
the over-the-counter market on the day in question as
reported by the National Quotation Bureau Incorporated,
or similar generally accepted reporting service, or, if
not so available in such manner, as furnished by any
AMEX member firm selected from time to time by the
Board of Directors of the Corporation for that purpose
or, if not so available in such manner, as otherwise
determined in good faith by the Board of Directors of
the Corporation.
(vii) No adjustment in the conversion price
shall be required unless such adjustment would require
an increase or decrease of at least 1% in the
conversion price; provided, however, that any
adjustments which by reason of this paragraph (vii) are
not required to be made shall be carried forward and
taken into account in any subsequent adjustment.
(viii) Whenever the conversion price is
adjusted as herein provided:
(A) the Corporation shall make an
appropriate corresponding proportional adjustment
to the conversion rate which shall become
effective when the adjustment to the conversion
price becomes effective;
(B) the Corporation shall compute the
adjusted conversion price and conversion rate and
shall prepare a certificate signed by a Vice
President or the Treasurer of the Corporation
setting forth the adjusted conversion price and
conversion rate and showing in reasonable detail
the facts upon which such adjustments are based,
and such certificate shall forthwith be filed with
the transfer agent for the Convertible Preferred
Stock; and
(C) as soon as practicable after the
adjustments, the Corporation shall mail to all
record holders of Convertible Preferred Stock at
their last addresses as they shall appear in stock
transfer books of the Corporation a notice stating
that the conversion price and conversion rate have
been adjusted and setting forth the adjusted
conversion price and conversion rate.
(ix) The Corporation from time to time may
reduce the conversion price or increase the conversion
rate by any amount for any period of time if the period
is at least twenty (20) days and the Board of Directors
has made a determination that such reduction (or
increase) would be in the best interest of the
Corporation, which determination shall be conclusive.
Whenever the conversion price is reduced (or the
conversion rate increased) pursuant to the preceding
sentence, the Corporation shall mail to the record
holders of Convertible Preferred Stock a notice of the
reduction (or increase) at least fifteen (15) days
prior to the date the reduced conversion price (or
increased conversion rate) takes effect, and such
notice shall state the reduced conversion price (or
increased conversion rate) and the period it will be in
effect.
(d) No Fractional Shares. No fractional shares of
Common Stock shall be issued upon conversion of the
Convertible Preferred Stock. If more than one certificate
evidencing shares of Convertible Preferred Stock shall be
surrendered for conversion at such time by the holder, the
number of full shares issuable upon conversion thereof shall
be computed on the basis of the aggregate number of shares
of Convertible Preferred Stock so surrendered. Instead of
any fractional share of Common Stock that would otherwise be
issuable to a holder upon conversion of any shares of
Convertible Preferred Stock, the Corporation shall either
(i) pay a cash adjustment in respect of such fractional
share in an amount equal to the same fraction of the Market
Price for the shares of Common Stock as of the day of such
conversion or (ii) aggregate all such fractional shares into
a whole number of shares and sell such aggregated fractional
shares on behalf of the holders entitled thereto in a public
or private sale and distribute the net cash proceeds from
the sale thereof to such holders pro rata. If the
Corporation should so elect so to aggregate and sell such
fractional shares, it shall endeavor to use its best efforts
to secure the best available sales price for such shares but
shall not be obligated to secure the highest price
obtainable for such shares.
(e) Reclassification, Consolidation, Merger or Sale
of Assets. In the event that the Corporation shall be a
party to any transaction pursuant to which the Common Stock
is converted into the right to receive other securities,
cash or other property (including without limitation any
recapitalization or reclassification of the Common Stock
(other than a change in par value, or from par value to no
par value, or from no par value to par value, or as a result
of a subdivision or combination of the Common Stock), any
consolidation of the Corporation with, or merger of the
Corporation into, any other person, any merger or another
person into the Corporation (other than a merger which does
not result in a reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock), any
sale or transfer of all or substantially all of the assets
of the Corporation or any share exchange), then lawful
provisions shall be made as part of the terms of such
transaction whereby the holder of each share of Convertible
Preferred Stock then outstanding shall have the right
thereafter to convert such share only into the kind and
amount of securities, cash and other property receivable
upon such transaction by a holder of the number of shares of
Common Stock into which such share might have been converted
immediately prior to such transaction provided, however,
that if the holders of Common Stock were entitled by the
terms of the transaction to make an election to receive
securities, cash or property, or any combination of the
foregoing, lawful provision shall be made as part of the
terms of such transaction whereby the holder of each share
of Convertible Preferred Stock then outstanding shall have
the right thereafter to convert such share only into the
kind and amount of securities, cash or other property
receivable upon such transaction by a holder of the number
of shares of Common Stock who made one of the elections
provided for in such transaction (as determined by the Board
of Directors, whose determination shall be conclusive) into
which such share might have been converted immediately prior
to such transaction. The Corporation or the person formed
by such consolidation or resulting from such merger or which
acquires such shares or which acquires the Corporation's
shares, as the case may be, shall make provisions in its
certificate or articles of incorporation or other
constituting document to establish such right. Such
certificate or articles of incorporation or other
constituting document shall provide for adjustments which,
for events subsequent to the effective date of such
certificate or articles of incorporation or other
constituting document, shall be as nearly equivalent as may
be practicable to the adjustments provided for in this
Section 3. The above provisions shall similarly apply to
successive transactions of the foregoing type.
(f) Reservation of Shares; Etc. The Corporation
shall at all times reserve and keep available, free from
preemptive rights out of its authorized and unissued Common
Stock and/or Common Stock held in treasury, solely for the
purpose of effecting the conversion of the Convertible
Preferred Stock, such number of shares of its Common Stock
as shall from time to time be sufficient to effect the
conversion of all shares of Convertible Preferred Stock from
time to time outstanding. The Corporation shall from time
to time, in accordance with the laws of the State of
Delaware, in good faith and as expeditiously as possible,
endeavor to cause the authorized number of shares of Common
Stock to be increased (or combine or repurchase its
outstanding shares of Common Stock) if at any time the
number of shares of authorized and unissued Common Stock
and/or Common Stock held in treasury, shall not be
sufficient to permit the conversion of all the then
outstanding shares of Convertible Preferred Stock.
If any shares of Common Stock required to be reserved
for the purposes of conversion of the Convertible Preferred
Stock hereunder require registration with or approval of any
governmental authority under any Federal or State law before
such shares may be issued upon conversion, the Corporation
will in good faith and as expeditiously as possible endeavor
to cause such shares to be duly registered or approved as
the case may be. If the Common Stock is listed on any
national securities exchange, the Corporation will, if
permitted by the rules of such exchange, list and keep
listed on such exchange, upon official notice of issuance,
all shares of Common Stock issuable upon conversion of the
Convertible Preferred Stock, for so long as the Common Stock
continues to be so listed.
(g) Prior Notice of Certain Events. In case:
(i) the Corporation shall (A) declare any
dividend (or any other distribution) on its Common
Stock, other than (1) a dividend payable in shares
of Common Stock or (2) a dividend payable in cash
out of its retained earnings other than any
special or nonrecurring or other extraordinary
dividend or (B) declare or authorize a redemption
or repurchase of in excess of 10% of the then
outstanding shares of Common Stock; or
(ii) the Corporation shall authorize the
granting to all holders of Common Stock of rights
or warrants to subscribe for or purchase any
shares of stock of any class or series or of any
other rights or warrants; or
(iii) of any reclassification of Common
Stock (other than a subdivision or combination of
the outstanding Common Stock, or a change in par
value, or from par value to no par value, or from
no par value to par value), or of any
consolidation or merger to which the Corporation
is party and for which approval of any
stockholders of the Corporation shall be required,
or of the sale or transfer of all or substantially
all of the assets of the Corporation or of any
share exchange whereby the Corporation is
converted into other securities, cash or other
property; or
(iv) of the voluntary or involuntary
dissolution, liquidation or winding up of the
Corporation;
then the Corporation shall cause to be filed with the
transfer agent for the Convertible Preferred Stock, and
shall cause to be mailed to all holders of record of the
Convertible Preferred Stock at their last addresses as they
shall appear upon the stock transfer books of the
Corporation, at least fifteen (15) days prior to the
applicable record or effective date hereinafter specified, a
notice stating (x) the date on which a record (if any) is to
be taken for the purpose of such dividend, distribution,
redemption, repurchase, or grant of rights or warrants or,
if a record is not to be taken, the date as of which the
holders of Common Stock of record to be entitled to such
dividend, distribution, redemption, repurchase, rights or
warrants are to be determined or (y) the date on which such
reclassification, consolidation, merger, sale, transfer,
share exchange, dissolution, liquidation or winding up is
expected to become effective and the date as of which it is
expected that holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock, for
securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer,
share exchange, dissolution, liquidation or winding up (but
no failure to mail such notice or any defect therein or in
the mailing thereof shall affect the validity of the
corporate action required to be specified in such notice).
(h) Certain Additional Rights. In case the
Corporation shall, by dividend or otherwise, declare or make
a distribution on its Common Stock referred to in
Section 3(c)(iv) or 3(c)(v) (including, without limitation,
dividends or distribution referred to in the last sentence
of Section 3(c)(iv)), the holder of each share of
Convertible Preferred Stock upon the conversion thereof
subsequent to the close of business on the date fixed for
the determination of stockholders entitled to receive such
distribution and prior to the effectiveness of the
conversion price adjustment in respect of such distribution,
shall be entitled to receive for each share of Common Stock
into which such share of Convertible Preferred Stock is
converted, the portion of the shares of Common Stock,
rights, warrants, evidences of indebtedness, shares of
capital stock, cash and assets as distributed applicable to
one share of Common Stock; provided, however, that at the
election of the Corporation (whose election shall be
evidenced by a resolution of the Board of Directors) with
respect to all holders so converting, the Corporation may,
in lieu of distributing to such holder any portion of such
distribution not consisting of cash or securities of the
Corporation, pay such holder an amount in cash equal to the
fair market value thereof (as determined in good faith by
the Board of Directors, which determination shall be
conclusive). If any conversion of a share of Convertible
Preferred Stock described in the immediately preceding
sentence occurs prior to the payment date for a distribution
to holders of Common Stock which the holder of the share of
Convertible Preferred Stock so converted is entitled to
receive in accordance with the immediately preceding
sentence, the Corporation may elect (such election to be
evidenced by a resolution of the Board of Directors) to
distribute to such holder a due bill for the shares of
Common Stock, rights, warrants, evidences of indebtedness,
shares of capital stock, cash or assets to which such holder
is so entitled, provided that such due bill (a) meets any
applicable requirements of the principal national securities
exchange or other market on which the Common Stock is then
traded and (b) requires payment or delivery of such shares
of Common Stock, rights, warrants, evidences of
indebtedness, shares of capital stock, cash or assets no
later than the date of payment or delivery thereof to
holders of shares of Common Stock receiving such
distribution.
(i) Mandatory Conversion Right.
(i) At any time after November 20, 1997, and
provided that the Corporation is current in the payment
of dividends on the Convertible Preferred Stock to the
Mandatory Conversion Date, the Corporation may, at its
option, require the conversion of all the outstanding
shares of Convertible Preferred Stock. The Corporation
may exercise this option only if for twenty (20)
trading days within any period of thirty (30)
consecutive trading days, including the last trading
day of such period, the Current Market Price (as
defined in subparagraph (iii) below) of the Common
Stock equals or exceeds 150% of the current conversion
price of the Convertible Preferred Stock, such
conversion price to be subject to adjustments in the
same manner and for the same events as the conversion
price in Section 3. In order to exercise its mandatory
conversion option, the Corporation must issue a press
release for publication on the Dow Jones News Service,
Reuters, Bloomberg, or other widely disseminated
publicly available financial news service, announcing
the effective date of the mandatory conversion of the
Convertible Preferred Stock (the "Mandatory Conversion
Date") prior to the opening of business on the second
trading day after any period in which the condition in
the preceding sentence has been met, but in no event
prior to November 20, 1997. The press release shall
announce the Mandatory Conversion Date and provide the
current conversion price, current conversion rate and
Current Market Price of the Common Stock, in each case
as of the close of business on the trading day next
preceding the date of the press release. Effective on
the Mandatory Conversion Date, all of the issued and
outstanding shares of Convertible Preferred Stock shall
be converted into fully paid and non-assessable shares
of Common Stock at such current conversion price and
current conversion rate set forth in such press release
in the manner provided in this Section 3. Effective as
of the close of business on the Mandatory Conversion
Date, the shares of Convertible Preferred Stock shall
no longer be deemed to be issued and outstanding and
certificates evidencing such Stock shall solely
evidence the right to receive the shares of Common
Stock issuable in such conversion.
(ii) Notice of the exercise of the Mandatory
Conversion Right will be given by first-class mail to
the record holders of the Convertible Preferred Stock
not more than four (4) business days after the
Corporation issues the press release. The Mandatory
Conversion Date will be a date selected by the
Corporation not less than thirty (30) nor more than
sixty (60) days after the date on which the Corporation
issues the press release announcing its intention to
exercise its Mandatory Conversion Right.
(iii) The term "Current Market Price' of the
Common Stock for any day means the reported closing bid
price, regular way, on such day, as reported on the
AMEX, or, if the Common Stock is not listed or admitted
to trading on the AMEX on such day, on the principal
national securities exchange on which the Common Stock
is listed or admitted to trading, if the Common Stock
is listed on a national securities exchange, or the
Nasdaq NMS or, if the Common Stock is not quoted or
admitted to trading on such quotations system, on the
principal quotation system in which the Common Stock
may be listed or admitted to trading or quoted or, if
not listed or admitted to trading or quoted on any
national securities exchange or quotation system, the
average of the closing bid and asked prices of the
Common Stock in the over-the-counter market on the day
in question as reported by the National Quotation
Bureau Incorporated, or similar generally accepted
reporting service, or, if not so available in such
manner, as furnished by any AMEX member firm selected
from time to time by the Board of Directors of the
Corporation for that purpose or, if not so available in
such manner, as otherwise determined in good faith by
the Board of Directors of the Corporation, which
determination shall be conclusive.
Section 4. Special Conversion Rights.
(a) Change of Control. Upon the occurrence of a
Change of Control (as defined in Section 4(e)) with respect
to the Corporation, each holder of Convertible Preferred
Stock shall have the right, at the holder's option, for a
period of thirty (30) days after the mailing of a notice by
the Corporation that a Change of Control has occurred, to
convert all, but not less than all, of such holder's
Convertible Preferred Stock into Common Stock of the
Corporation at an adjusted conversion price per share equal
to the Special Conversion Price (as defined in Section
4(e)). The Corporation may, at its option, in lieu of
providing Common Stock upon any such special conversion,
provide the holder with cash equal to the Market Value (as
defined in Section 4(e)) of the Common Stock multiplied by
the number of shares of Common Stock into which such
Convertible Preferred Stock would have been convertible
immediately prior to such Change of Control at an adjusted
conversion price equal to the Special Conversion Price. The
special conversion right arising upon a Change of Control
shall only be applicable with respect to the first Change of
Control that occurs after the first date of issuance of any
Convertible Preferred Stock. Convertible Preferred Stock
which becomes convertible pursuant to a special conversion
right shall, unless so converted, remain convertible
pursuant to Section 3 at the conversion price and conversion
rate in effect immediately before the effective date of the
Change of Control, subject to subsequent adjustment as
provided in Section 3(c).
(b) Fundamental Change. Upon the occurrence of a
Fundamental Change (as defined in Section 4(e)) with respect
to the Corporation, each holder of Convertible Preferred
Stock shall have a special conversion right, at the holder's
option, for a period of thirty (30) days after the mailing
of a notice by the Corporation that a Fundamental Change has
occurred, to convert all, but not less than all, of such
holder's Convertible Preferred Stock into the kind and
amount of cash, securities, property or other assets
receivable upon such Fundamental Change by a holder of the
number of shares of Common Stock into which such Convertible
Preferred Stock would have been convertible immediately
prior to such Fundamental Change at an adjusted conversion
price equal to the Special Conversion Price. The
Corporation or a successor corporation, as the case may be,
may, at its option and in lieu of providing the
consideration as required above upon such conversion,
provide the holder with cash equal to the Market Value of
the Common Stock multiplied by the number of shares of
Common Stock into which such Convertible Preferred Stock
would have been convertible immediately prior to such
Fundamental Change at an adjusted conversion price equal to
the Special Conversion Price.
(c) Notice. Upon the occurrence of a Change of
Control or a Fundamental Change with respect to the
Corporation, within thirty (30) days after such occurrence,
the Corporation shall mail to each holder of Convertible
Preferred Stock a notice of such occurrence (the "Special
Conversion Notice") setting forth the following:
(i) the event constituting the Change of
Control or Fundamental Change;
(ii) the date upon which the applicable
special conversion right will terminate;
(iii) the Special Conversion Price;
(iv) the conversion price and conversion rate
then in effect under Section 3 and the continuing
conversion rights, if any, under Section 3;
(v) the name and address of the paying agent
and conversion agent;
(vi) that holders who want to convert
Convertible Preferred Stock must satisfy the
requirements of Section 4(d) and must exercise such
conversion right within the thirty (30)-day period
after the mailing of such notice by the Corporation;
(vii) that exercise of such conversion right
shall be irrevocable and no dividends on the
Convertible Preferred Stock (or portions thereof)
tendered for conversion shall accrue from and after the
conversion date; and
(viii) that the Corporation (or a successor
corporation, if applicable) may, at its option, elect
to pay cash (specifying the amount thereof per share)
for all Convertible Preferred Stock tendered for
conversion.
(d) Exercise Procedures. A holder of Convertible
Preferred Stock must exercise the special conversion right
within the thirty (30)-day period after the mailing of the
Special Conversion Notice or such special conversion right
shall expire. Such right must be exercised in accordance
with Section 3(b) to the extent the procedures in
Section 3(b) are consistent with the special provisions of
this Section 4. Exercise of such conversion right shall be
irrevocable and no payments or adjustments in respect of
dividends on shares of Convertible Preferred Stock
surrendered for conversion, whether paid or unpaid and
whether or not in arrears shall be made by the Corporation
upon exercise of such conversion right. The conversion date
with respect to the exercise of a special conversion right
arising upon a Change of Control or Fundamental Change shall
be the thirtieth (30th) day after the mailing of the Special
Conversion Notice.
Convertible Preferred Stock which becomes convertible
pursuant to a special conversion right shall, unless
converted, remain convertible pursuant to Section 3 into the
kind and amount of cash, securities, property or other
assets that the holders of the Convertible Preferred Stock
would have owned immediately after the Fundamental Change if
the holders had converted the Convertible Preferred Stock
immediately before the effective date of the Fundamental
Change, subject to subsequent adjustment under the
provisions contemplated by Section 3(c), if applicable.
(e) Definitions. The following definitions shall
apply to terms used in this Section 4:
(i) A "Change of Control" with respect to the
Corporation shall be deemed to have occurred at the
first time after the Issue Date that any person (within
the meaning of Sections 13(d)(3) and 14(d)(2) of the
Exchange Act)), including a group (within the meaning
of Rule 13d-5 under the Exchange Act), together with
any of its Affiliates or Associates (as defined below),
files or becomes obligated to file a report (or any
amendment or supplement thereto) on Schedule 13D or 14D-
1 pursuant to the Exchange Act, disclosing that such
person has become the beneficial owner of either
(A) 50% or more of the shares of Common Stock of the
Corporation then outstanding or (B) securities
representing 50% or more of the combined voting power
of the Voting Stock (as defined below) of the
Corporation then outstanding; provided a Change of
Control shall not be deemed to have occurred with
respect to any transaction that constitutes a
Fundamental Change. As used herein, a person shall be
deemed to have "beneficial ownership" with respect to,
and shall be deemed to "beneficially own," any
securities of the Corporation in accordance with
Section 13 of the Exchange Act and the rules and
regulations (including Rule 13d-3, Rule 13d-5 and any
successor rules) promulgated by the Securities and
Exchange Commission thereunder; provided that a person
shall be deemed to have beneficial ownership of all
securities that any such person has a right to acquire
whether such right is exercisable immediately or only
after the passage of time and without regard to the
sixty (60)-day limitation referred to in Rule 13d-3
and, provided further, that a beneficial owner of
Convertible Preferred Stock shall not be deemed to
beneficially own the Common Stock into which such
Convertible Preferred Stock is convertible solely by
reason of ownership of the Convertible Preferred Stock.
An "Affiliate" of a specified person is a person that
directly or indirectly controls, or is controlled by or
is under common control with, the person specified. An
"Associate" of a person means (i) any corporation or
organization, other than the Corporation or any
subsidiary of the Corporation, of which the person is
an officer or partner or is, directly or indirectly,
the beneficial owner of 10% or more of any class of
equity securities; (ii) any trust or estate in which
the person has a substantial beneficial interest or as
to which the person serves as trustee or in a similar
fiduciary capacity; and (iii) any relative or spouse of
the person or any relative of the spouse, who has the
same home as the person or who is a director or officer
of the person or any of its parents or subsidiaries.
(ii) "Exchange Act" means the Securities
Exchange Act of 1934, as amended, and as in effect on
the date hereof.
(iii) A "Fundamental Change" with respect to
the Corporation means (A) the occurrence of any
transaction or event in connection with which all or
substantially all of the Common Stock of the
Corporation shall be exchanged for, converted into,
acquired for or constitute solely the right to receive
cash, securities, property or other assets (whether by
means of an exchange offer, liquidation, tender offer,
consolidation, merger, combination, reclassification,
recapitalization or otherwise) or (B) the conveyance,
sale, lease, assignment, transfer or other disposal of
all or substantially all of the Corporation's property,
business or assets; provided, however, that a
Fundamental Change shall not be deemed to have occurred
with respect to either of the following transactions or
events: (1) any transaction or event in which more than
50% (by value as determined in good faith by the Board
of Directors) of the consideration received by holders
of Common Stock consists of Marketable Stock (as
defined below); or (2) any consolidation or merger of
the Corporation immediately prior to such transaction
own, directly or indirectly, (x) 50% or more of the
common stock of the surviving corporation (or of the
ultimate parent of such surviving corporation)
outstanding at the time immediately after such
consolidation or merger and (y) securities representing
50% or more of the combined voting power of the
surviving corporation's Voting Stock (or for the Voting
Stock of the ultimate parent of such surviving
corporation) outstanding at such time. The phrase "all
or substantially all" as used in this definition in
reference to the Common Stock shall mean 66% or more of
the aggregate outstanding amount of Common Stock.
(iv) "Voting Stock" means, with respect to any
person, capital stock of such person having general
voting power under ordinary circumstances to elect at
least a majority of the board of directors, managers or
trustees of such person (irrespective of whether or not
at the time capital stock of any other class or classes
shall have or might have voting power by reason of the
happening of any contingency).
(v) The "Special Conversion Price" shall mean
the lesser of the Market Value of the Common Stock and
the prevailing conversion price.
(vi) The "Market Value" of the Common Stock or
any other Marketable Stock shall be the average of the
last reported sales prices of the Common Stock or such
other Marketable Stock, as the case may be, for the
five business days ending on the last business day
preceding the date of the Change of Control or
Fundamental Change; provided, however, that if the
Marketable Stock is not traded on any national
securities exchange or similar quotation system as
described in the definition of "Marketable Stock"
during such period, then the Market Value of such
Marketable Stock shall be the average of the last
reported sales prices per share of such Marketable
Stock during the first five business days commencing
with the first day after the date on which such
Marketable Stock was first distributed to the general
public and traded on the New York Stock Exchange
("NYSE"), the AMEX, the Nasdaq NMS or any similar
system of automated dissemination of quotations of
securities prices in the United States.
(vii) "Marketable Stock" shall mean Common
Stock or common stock of any corporation that is the
successor to all or substantially all of the business
or assets of the corporation as a result of a
Fundamental Change (or of the ultimate parent of such
successor), which is (or will, upon distribution
thereof, be) listed or quoted on the NYSE, the AMEX,
the Nasdaq NMS or any similar system of automated
dissemination of quotations of securities prices in the
United States.
Section 5. General Class and Series Voting Rights.
The Convertible Preferred Stock shall have the following
voting rights in addition to (i) any special voting rights
specifically required by the laws of the State of
Delaware,(ii) as are provided in Section 6 and (iii) as
provided by the provisions of this Restated Certificate of
Incorporation of the Corporation:
(a) So long as any shares of Convertible Preferred
Stock remain outstanding, the holders of Convertible
Preferred Stock will be entitled to receive notice of any
meeting of, and solicitation of any consent from the
holders of Common Stock and to vote with the holders of
Common Stock on, and to consent to all matters on which the
holders of Common Stock are entitled to vote or consent to,
respectively. Each share of Convertible Preferred Stock
shall be entitled to cast the same number of votes as the
full number of shares of Common Stock that are then issuable
upon conversion thereof.
(b) So long as any shares of Convertible Preferred
Stock remain outstanding, the vote or consent of the holders
of at least two-thirds of the shares of Convertible
Preferred Stock outstanding at the time (voting separately
as a class) given in person or by proxy, either in writing
or at any special or annual meeting called for the purpose,
shall be necessary to permit, effect or validate any one or
more of the following:
(i) The authorization, creation or issuance,
or any increase in the authorized or issued amount, of
any class or series of stock (including any class or
series of preferred stock) ranking prior (as that term
is hereinafter defined in this Section 5) to the
Convertible Preferred Stock; or
(ii) The amendment, alteration or repeal,
whether by merger, consolidation or otherwise, of any
of the provisions of this Restated Certificate of
Incorporation or of these resolutions which would
alter, change or repeal the powers, preferences, or
special rights of the shares of the Convertible
Preferred Stock so as to affect them adversely.
(c) The foregoing voting provisions shall not apply
if, at or prior to the time when the act with respect to
which such vote would otherwise be required shall be
effected, all outstanding shares of Convertible Preferred
Stock shall have been redeemed or sufficient funds and/or
shares of Common Stock shall have been deposited in trust to
effect such redemption.
(d) For purposes of this resolution, any class or
series of stock of the Corporation shall be deemed to rank:
(i) prior to the Convertible Preferred Stock
as to dividends or as to distribution of assets upon
liquidation, dissolution or winding up, if the holders
of such class or series shall be entitled to the
receipt of dividends or amounts distributable upon
liquidation, dissolution or winding up, as the case may
be, in preference or priority to the holders of
Convertible Preferred Stock;
(ii) on a parity with the Convertible
Preferred Stock as to dividends or as to distribution
of assets upon liquidation, dissolution or winding up,
whether or not the dividend rates, dividend payment
dates, or redemption or liquidation prices per share
thereof shall be different from those of the
Convertible Preferred Stock, if the holders of such
class or series of stock and the Convertible Preferred
Stock shall be entitled to the receipt of dividends or
of amounts distributable upon liquidation, dissolution
or winding up, as the case may be, in proportion to
their respective dividend rates or liquidation prices,
without preference or priority one over the other as of
the date of adoption of this resolution. The Series A,
Series B, Series E and Series F Preferred Stock are on
a parity with the Convertible Preferred Stock as to
dividends and as to distribution of assets upon
liquidation, dissolution or winding up; and
(iii) junior to the Convertible Preferred
Stock as to dividends or as to distribution of assets
upon liquidation, dissolution or winding up, if such
class or series shall be Common Stock or if the holders
of the Convertible Preferred Stock shall be entitled to
the receipt of dividends or of amounts distributable
upon liquidation, dissolution or winding up, as the
case may be, in preference or priority to the holders
of shares of such class or series.
Section 6. Default Voting Rights.
(a) Election of Directors. Whenever, at any time
or times, dividends payable on the shares of Convertible
Preferred Stock shall be in arrears in an amount equal to at
least three semi-annual dividends (whether or not
consecutive and whether payable in cash or shares of
Convertible Preferred Stock), the holders of the outstanding
shares of Convertible Preferred Stock shall have the
exclusive right (voting separately as a class) to elect two
directors of the Corporation.
(b) Vote Per Share. At elections for such
directors, each holder of Convertible Preferred Stock shall
be entitled to one vote for each share of Convertible
Preferred Stock held. Upon the vesting of such right with
the holders of Convertible Preferred Stock, the maximum
authorized number of members of the Board of Directors shall
automatically be increased by two, which shall be of the
class or classes selected by the Corporation's Board of
Directors which has the least number of director positions
then currently filled, and the two vacancies so created
shall be filled by vote of the holders of the outstanding
shares of Convertible Preferred Stock as hereinafter set
forth. The right of the holders of Convertible Preferred
Stock, voting separately as a class to elect members of the
Board of Directors of the Corporation shall continue until
such time as all dividends accrued and unpaid on the
Convertible Preferred Stock shall have been paid or declared
and funds set aside to provide for payment in full, at which
time such right shall terminate, except as herein or by law
expressly provided, subject to revesting in the event of
each and every subsequent default of the character above
mentioned, and the term of office of all directors so
elected shall terminate also.
(c) Meetings. Whenever the voting right described
in subsection (a) above shall have vested in the holders of
the Convertible Preferred Stock, the right may be exercised
initially either at a special meeting of the holders of the
Convertible Preferred Stock called as hereinafter provided,
or at any annual meeting of stockholders held for the
purpose of electing directors, and thereafter at each
successive annual meeting.
(d) Call of Meeting. At any time when the voting
right described in subsection (a) above shall have vested in
the holders of the Convertible Preferred Stock, and if the
right shall not already have been initially exercised, a
proper officer of the Corporation shall, upon the written
request of the holders of record of 10% in number of the
shares of the Convertible Preferred Stock then outstanding,
addressed to the Secretary of the Corporation, call a
special meeting of the holders of the Convertible Preferred
Stock for the purpose of electing directors. Such meeting
shall be held at the earliest practicable date upon the
notice required for annual meetings of stockholders at the
place for holding of annual meetings of stockholders of the
Corporation, or, if none, at a place designated by the
Secretary of the Corporation. If the meeting shall not be
called by the proper officers of the Corporation within
thirty (30) days after the personal service of such written
request upon the Secretary of the Corporation, or within
thirty (30) days after mailing it within the United States
of America, by registered mail, addressed to the Secretary
of the Corporation at its principal office (such mailing to
be evidenced by the registry receipt issued by the postal
authorities), then the holders of record of 10% in number of
the shares of the Convertible Preferred Stock then
outstanding may designate in writing one of their members to
call such meeting at the expense of the Corporation, and
such meeting may be called by such person so designated upon
the notice required for annual meetings of stockholders and
shall be held at the same place as is elsewhere provided for
in this subsection (d). Any holder of the Convertible
Preferred Stock shall have access to the share transfer
books of the Corporation as permitted under the Delaware
General Corporation Law for the purpose of causing a meeting
of the stockholders to be called pursuant to the provisions
of this subsection (d). Notwithstanding the provisions of
this subsection (d), however, no such special meeting shall
be held during a period within sixty (60) days immediately
preceding the date fixed for the next annual meeting of
stockholders.
(e) Quorum. At any meeting held for the purpose of
electing directors at which the holders of the Convertible
Preferred Stock shall have the right to elect directors as
provided herein, the presence in person or by proxy of the
holders of 50% of the then outstanding shares of the
Convertible Preferred Stock shall be required and be
sufficient to constitute a quorum of the holders of the
Convertible Preferred Stock for the election of directors.
At any such meeting or adjournment thereof (i) the absence
of a quorum of the holders of the Convertible Preferred
Stock shall not prevent the election of directors other than
those to be elected by the holders of the Convertible
Preferred Stock and the absence of a quorum or quorums of
the holders of other classes or series of capital stock
entitled to elect such other directors shall not prevent the
election of directors to be elected by the holders of the
Convertible Preferred Stock and (ii) in the absence of a
quorum of the holders of the Convertible Preferred Stock, a
majority of the holders present in person or by proxy of the
Convertible Preferred Stock shall have the power to adjourn
the meeting, or appropriate portion thereof for the election
of directors which the holders of the Convertible Preferred
Stock are entitled to elect, from time to time, without
notice other than announcement at the meeting, until a
quorum shall be present. The Chairman of the Board or the
President of the Corporation shall preside at any such
meeting.
(f) Term. Each director elected by the holders of
shares of Convertible Preferred Stock shall continue to
serve as a director until such time as all dividends accrued
and unpaid on the Convertible Preferred Stock shall have
been paid or declared and funds set aside to provide for
payment in full, at which time the term of office of all
persons elected as directors by the holders of shares of
Convertible Preferred Stock shall forthwith terminate and
the number of members of the Board of Directors of the
Corporation shall be reduced accordingly. Whenever the term
of office of the directors elected by the holders of
Convertible Preferred Stock voting as a class shall end and
the special voting powers vested in the holders of
Convertible Preferred Stock as provided in this Section 6
shall have expired, the number of directors shall be such
number as may be provided for in the By-Laws irrespective of
any increase made pursuant to the provisions of this Section
6.
Section 7. Redemption Rights.
(a) Optional Redemption. The Corporation may at
its option, at any time on or after May 1, 2002, in the
years indicated below, redeem (an "Optional Redemption")
all, or any number less than all, of the outstanding shares
of Convertible Preferred Stock, provided, that the
Convertible Preferred Stock may not be redeemed, in whole or
in part, prior to May 1, 2002. All optional redemptions of
shares of Convertible Preferred Stock shall be effected
during the twelve (12) month period beginning on May 1 of
the year indicated at the applicable redemption prices set
forth below:
Redemption Price
Year Per Share
2002 $ 90.00
2003 88.33
2004 86.67
2005 85.00
and thereafter at $85.00 per share, plus, in each case, an
amount equal to all dividends (whether or not declared)
accrued and unpaid on such share of Convertible Preferred
Stock to the date fixed for redemption (the price from time
to time to redeem the Convertible Preferred Stock excluding
any dividends (whether or not declared) accrued and unpaid,
is referred to herein as the "Redemption Price").
(b) Mandatory Redemption. Each issued and
outstanding share of Convertible Preferred Stock shall be
redeemed on May 1, 2007, or the next succeeding business day
(the "Mandatory Redemption") at a Redemption Price of $85.00
per share, plus all dividends (whether or not declared)
accrued and unpaid on such share of Convertible Preferred
Stock to the date fixed for redemption, payable in cash or,
at the election of the Corporation, in shares of Common
Stock ("Redemption Stock").
(c) Accrued Dividends. The Corporation may not
purchase, redeem or otherwise acquire for value any shares
of Convertible Preferred Stock or shares of any other series
of Preferred Stock then outstanding ranking on a parity with
or junior to the Convertible Preferred Stock unless all
accrued dividends on all shares of Convertible Preferred
Stock then outstanding shall have been paid or declared and
a sum of cash (or shares of Preferred Dividend Stock)
sufficient for the payment thereof set apart. No sinking
fund shall be established for the Convertible Preferred
Stock.
(d) Mandatory Redemption Price Paid in Common
Stock. The Corporation may pay the Redemption Price for
Convertible Preferred Stock called for Mandatory Redemption
pursuant to Section 7(b) by issuing, for each full share of
Convertible Preferred Stock being redeemed, to the holder
thereof, such number of shares of Redemption Stock equal to
the value of the Market Price averaged over the twenty (20)
trading days preceding the date of notice of redemption
provided for in Section 7(e). All such shares of Redemption
Stock shall be duly authorized, validly issued, fully paid
and non-assessable. The Corporation will not issue any
fractional shares or script representing fractional shares
of Common Stock upon such redemption of the Convertible
Preferred Stock and, in lieu thereof, will either (i) pay a
cash adjustment based on the Market Price of the Common
Stock as of the last trading day prior to the Redemption
Date (as hereinafter defined) or (ii) aggregate and sell all
such fractional shares and distribute the proceeds to
holders as provided in Section 3(d).
For purpose of this Section 7(d), "Common Stock" shall
mean the Common Stock of the Corporation or any other cash,
securities or property that the holder of Convertible
Preferred Stock is entitled to receive upon conversion of
the Convertible Preferred Stock pursuant to Section 3(c).
(e) Notice of Redemption. Notice of any proposed
Optional or Mandatory Redemption of shares of Convertible
Preferred Stock shall be mailed to each record holder of the
shares of Convertible Preferred Stock to be redeemed at
least thirty (30) but not more than sixty (60) days prior to
the date fixed for such redemption (herein referred to as
the "Redemption Date"). Each such notice shall set forth
the following:
(i) the Redemption Date;
(ii) the Redemption Price per share;
(iii) the place for payment and for delivering
the stock certificate(s) and transfer instrument(s) in
order to receive the Redemption Price;
(iv) the shares of Convertible Preferred Stock
to be redeemed;
(v) the then effective conversion price and
conversion rate;
(vi) the Market Price of the Common Stock on
the last trading day prior to the date of the notice;
(vii) whether the Corporation will pay the
Redemption Price of the Convertible Preferred Stock to
be redeemed by issuing shares of Common Stock as
provided in subsection (d) above and, if so, the
average of the Market Prices over the twenty (20)
trading days preceding the date of the notice; and
(viii) that the right of holders of shares of
Convertible Preferred Stock being redeemed to exercise
their conversion right shall terminate as to such
shares at the close of business on the date fixed for
redemption (provided that no default by the Corporation
in the payment of the applicable Redemption Price
(including any accrued and unpaid dividends) shall have
occurred and be continuing).
Any notice mailed in such manner shall be conclusively
deemed to have been duly given regardless of whether such
notice is in fact received. If less than all the
outstanding shares of Convertible Preferred Stock are to be
redeemed, the Corporation will select those to be redeemed
ratably or by lot in a manner determined by the Board of
Directors. In order to facilitate the redemption of the
Convertible Preferred Stock, the Board of Directors may fix
a record date for determination of holders of Convertible
Preferred Stock to be redeemed, which shall not be more than
thirty (30) days prior to the Redemption Date with respect
thereto.
The holder of any shares of Convertible Preferred Stock
redeemed pursuant to this Section 7 upon any exercise of the
Corporation's redemption right shall not be entitled to
receive payment of the Redemption Price for such shares
until such holder shall cause to be delivered to the place
specified in the notice given with respect to such
redemption (i) the certificate(s) representing such share of
Convertible Preferred Stock and (ii) transfer instrument(s)
sufficient to transfer such shares of Convertible Preferred
Stock to the Corporation free of any adverse interest. No
interest shall accrue on the Redemption Price of any share
of Convertible Preferred Stock after the Redemption Date.
At the close of business on the Redemption Date for any
share of Convertible Preferred Stock, such share shall
(provided the Redemption Price (including any accrued and
unpaid dividends to the Redemption Date) of such shares has
been paid or properly provided for) be deemed to cease to be
outstanding and all rights of any person other than the
Corporation in such share shall be extinguished on the
Redemption Date for such share (including all rights to
receive future dividends with respect to such share) except
for the right to receive the Redemption Price (including any
accrued and unpaid dividends to the Redemption Date),
without interest, for such share in accordance with the
provisions of this Section 7, subject to applicable escheat
laws.
In the event that any shares of Convertible Preferred
Stock shall be converted into Common Stock prior to the
Redemption Date pursuant to Section 3 or 4, then (i) the
Corporation shall not have the right to redeem such shares
and (ii) any funds, securities or other property which shall
have been deposited for the payment of the Redemption Price
for such shares shall be returned to the Corporation
immediately after such conversion (subject to declared
dividends payable to holders of shares of Convertible
Preferred Stock on the record date for such dividends being
so payable, to the extent set forth in Section 3 hereof;
regardless of whether such shares are converted subsequent
to such record date and prior to the related Dividend
Payment Date) and any shares of Common Stock reserved for
issuance upon redemption of such converted shares need no
longer be so reserved.
Notwithstanding the foregoing provisions of this
Section 7, and subject to the provisions of Section 2
hereof; if a dividend upon any shares of Convertible
Preferred Stock is past due, (i) no share of the Convertible
Preferred Stock may be redeemed, except by means of a
redemption pursuant to which all outstanding shares of the
Convertible Preferred Stock are simultaneously redeemed and
all accrued dividends paid and (ii) the Corporation shall
not purchase or otherwise acquire any shares of the
Convertible Preferred Stock, except pursuant to a purchase
or exchange offer made on the same terms to all holders of
the Convertible Preferred Stock.
Section 8. Rank; Liquidation. Upon any voluntary
or involuntary dissolution, liquidation or winding up of the
Corporation (for the purposes of this Section 8, a
"Liquidation"), after payment or provision for payment of
the debts and other liabilities of the Corporation, the
holders of Convertible Preferred Stock shall be entitled to
be paid out of the assets of the Corporation available for
distribution to its stockholders, an amount equal to $85.00
per share of Convertible Preferred Stock then held by such
stockholder, plus all dividends (whether or not declared or
due) accrued and unpaid on such share to the date fixed for
the distribution of assets of the Corporation to the holders
of Convertible Preferred Stock. The shares of Convertible
Preferred Stock shall rank prior to the shares of Common
Stock and any other class or series of stock of the
Corporation ranking junior to the Convertible Preferred
Stock, so that the holders of the Convertible Preferred
Stock shall receive the full amount to which they shall be
entitled before any distribution of assets shall be made to
the holders of the Common Stock or the holders of any other
stock that ranks junior to the Convertible Preferred Stock
in respect of distributions upon the Liquidation of the
Corporation.
If upon any Liquidation of the Corporation, the assets
available for distribution to the holders of Convertible
Preferred Stock and any other stock of the Corporation
ranking on a parity with the Convertible Preferred Stock
upon Liquidation which shall then be outstanding
(hereinafter in this paragraph called the "Total Amount
Available") shall be insufficient to pay the holders of all
outstanding shares of Convertible Preferred Stock and all
other such parity stock the full amounts (including all
dividends accrued and unpaid) to which they shall be
entitled by reason of such Liquidation of the Corporation,
then there shall be paid to the holders of the Convertible
Preferred Stock in connection with such Liquidation of the
Corporation, an amount equal to the product derived by
multiplying the Total Amount Available times a fraction, the
numerator of which shall be the full amount to which the
holders of the Convertible Preferred Stock shall be entitled
under the terms of the preceding paragraph by reason of such
Liquidation of the Corporation and the denominator of which
shall be the total amount which would have been distributed
by reason of such Liquidation of the Corporation with
respect to the Convertible Preferred Stock and all other
stock ranking on a parity with the Convertible Preferred
Stock upon Liquidation then outstanding had the Corporation
possessed sufficient assets to pay the maximum amount which
the holders of all such stock would be entitled to receive
in connection with such Liquidation of the Corporation.
The voluntary sale, conveyance, lease, exchange or
transfer of all or substantially all of the property or
assets of the Corporation, or the merger or consolidation of
the Corporation into or with any other corporation, or the
merger of any other corporation into the Corporation, or any
purchase or redemption of some or all of the shares of any
class or series of stock of the Corporation, shall not be
deemed to be a Liquidation of the Corporation for the
purposes of this Section 8 (unless in connection therewith
the Liquidation of the Corporation is specifically
approved).
The holder of any shares of Convertible Preferred Stock
shall not be entitled to receive any payment owed for such
shares under this Section 8 until such holder shall cause to
be delivered to the Corporation (i) the certificate(s)
representing such shares of Convertible Preferred Stock and
(ii) transfer instrument(s) satisfactory to the Corporation
and sufficient to transfer such shares of Convertible
Preferred Stock to the Corporation free of any adverse
interest. No interest shall accrue on any payment upon
Liquidation after the due date thereof.
After payment of the full amount of the liquidating
distribution to which they are entitled, the holders of
shares of the Convertible Preferred Stock will not be
entitled to any further participation in any distribution of
assets by the Corporation.
Section 9. Payments. The Corporation may provide
funds for any payment of the Redemption Price for any shares
of Convertible Preferred Stock or any amount distributable
with respect to any Convertible Preferred Stock under
Sections 7 and 8 hereof by depositing such funds with a bank
or trust company selected by the Corporation having a net
worth of at least $50,000,000, in trust for the benefit of
the holders of such shares of Convertible Preferred Stock
under arrangements providing irrevocably for payment upon
satisfaction of any conditions to such payments by the
holders of such shares of Convertible Preferred Stock which
shall reasonably be required by the Corporation. The
Corporation shall be entitled to make any deposit of funds
contemplated by this Section 9 under arrangements designed
to permit such funds to generate interest or other income
for the Corporation, and the Corporation shall be entitled
to receive all interest and other income earned by any funds
while they shall be deposited as contemplated by this
Section 9, provided that the Corporation shall maintain on
deposit funds sufficient to satisfy all payments which the
deposit arrangement shall require to be paid by the
Corporation.
Any payment which may be owed for the payment of the
Redemption Price for any shares of Convertible Preferred
Stock pursuant to Section 7 or the payment of any amount
distributable with respect to any shares of Convertible
Preferred Stock under Section 8 shall be deemed to have been
"paid or properly provided for" upon the earlier to occur
of: (i) the date upon which such funds sufficient to make
such payment shall be deposited in a manner contemplated by
the preceding paragraph or (ii) the date upon which a check
payable to the person entitled to receive such payment shall
be delivered to such person or mailed to such person at
either the address of such person then appearing on the
books of the Corporation or such other address as the
Corporation shall deem reasonable or (iii) in the case of a
Mandatory Redemption the Corporation shall have deposited a
sufficient amount of shares of Common Stock to pay the
Redemption Price as provided in Section 7(e).
Subject to applicable escheat laws, if the conditions
precedent to the disbursement of any funds deposited by the
Corporation pursuant to this Section 9 shall not have been
satisfied within six (6) months after the establishment of
the trust for such funds (or shares), then (i) such funds
(or shares) shall be returned to the Corporation upon its
request; (ii) after such return, such funds (or shares)
shall be free of any trust which shall have been impressed
upon them; (iii) the person entitled to this payment for
which such funds (or shares) shall have been originally
intended shall have the right to look only to the
Corporation for such payment, subject to applicable escheat
laws; and (iv) the trustee which shall have held such funds
(or shares) shall be relieved of any responsibility for such
funds (or shares) upon the return of such funds (or shares)
to the Corporation.
Section 10. Status of Reacquired Shares. Shares of
Convertible Preferred Stock issued and reacquired by the
Corporation (including, without limitation, shares of
Convertible Preferred Stock which have been redeemed
pursuant to the terms of Section 7 hereof and shares of
Convertible Preferred Stock which have been converted into
shares of Common Stock) shall have the status of authorized
and unissued shares of preferred stock, undesignated as to
series, subject to later issuance.
Section 11. Preemptive Rights. The Convertible
Preferred Stock is not entitled to any preemptive or
subscription rights in respect of any securities of the
Corporation.
Section 12. Miscellaneous.
(a) Transfer Taxes. The Corporation shall pay any
and all stock transfer and documentary stamp taxes that may
be payable in respect of any original issuance and delivery
of shares of Convertible Preferred Stock or shares of Common
Stock or Preferred Dividend Stock or Redemption Stock or
other securities issued on account of Convertible Preferred
Stock pursuant hereto or certificates or instruments
evidencing such shares or securities. The Corporation shall
not, however, be required to pay any such tax which may be
payable in respect of any transfer involved in the issuance
or delivery of shares of Convertible Preferred Stock or
Common Stock or other securities in a name other than that
in which the shares of Convertible Preferred Stock with
respect to which such shares or other securities are issued
or delivered were registered, or in respect of any payment
to any person with respect to any such shares or securities
other than a payment to the registered holder thereof; and
shall not be required to make any such issuance, delivery or
payment unless and until the person otherwise entitled to
such issuance, delivery or payment has paid to the
Corporation the amount of any such tax or has established,
to the satisfaction of the Corporation, that such tax has
been paid or is not payable.
(b) Failure to Designate Stockholder or Payee. In
the event that a holder of shares of Convertible Preferred
Stock shall not by written notice designate the name in
which shares of Common Stock to be issued upon conversion or
Preferred Dividend Stock to be issued as a dividend or
Redemption Stock to be issued upon redemption of such
shares, should be registered or to whom payment upon
redemption of shares of Convertible Preferred Stock should
be made or the address to which the certificates or
instruments evidencing such shares or such payment should be
sent, the Corporation shall be entitled to register such
shares and make such payment in the name of the holder of
such Convertible Preferred Stock as shown on the records of
the Corporation and to send the certificates or instruments
evidencing such shares or such payment, to the address of
such holder shown on the records of the Corporation.
(c) Registrar and Transfer Agent. The Corporation
may appoint, and from time to time discharge and change, the
registrar and transfer agent for the Convertible Preferred
Stock. The initial registrar and transfer agent for the
Convertible Preferred Stock shall be the Corporation.
(d) Severability. Whenever possible, each
provision hereof shall be interpreted in such a manner as to
be effective and valid under applicable law, but if any
provision hereof is held to be prohibited by or invalid
under applicable law, such provision shall be ineffective
only to the extent of such prohibition or invalidity,
without invalidating or otherwise adversely affecting the
remaining provisions hereof. If a court of competent
jurisdiction should determine that a provision hereof would
be valid or enforceable if a period of time were extended or
shortened or a particular percentage were increased or
decreased, then such court may make such change as shall be
necessary to render the provision in question effective and
valid under applicable law.