EXHIBIT 4.8
Form CD-26-5M-8-83
The Commonwealth of Massachusetts
OFFICE OF THE MASSACHUSETTS SECRETARY OF STATE
MICHAEL JOSEPH CONNOLLY, Secretary
ONE ASHBURTON PLACE, BOSTON, MASS. 02108
FEDERAL IDENTIFICATION
NO. 04-2384321
CERTIFICATE OF VOTE OF DIRECTORS ESTABLISHING
A SERIES OF A CLASS OF STOCK
General Laws, Chapter 156B, Section 26
---------
We, C. William Carey , President / and
Richard E. Floor , Clerk of
TOWN & COUNTRY CORPORATION
(Name of Corporation)
located at 25 Union Street, Chelsea, MA 02150 do hereby certify that pursuant to
a consent in lieu of special meeting of the directors of the corporation dated
November 18, 1994, the following vote establishing and designating a series of a
class of stock and determining the relative rights and preferences thereof was
duly adopted: -
See attached pages 2A to 17A.
Note: Votes for which the space provided above is not sufficient should be set
out on continuation sheets to be numbered 2A, 2B, etc. Continuation sheets must
have a left-hand margin 1 inch wide for binding and shall be 8 1/2" x 11". Only
one side should be used.
VOTE OF DIRECTORS
ESTABLISHING SERIES OF
CONVERTIBLE REDEEMABLE PREFERRED STOCK
OF
TOWN & COUNTRY CORPORATION
Pursuant to Section 26 of Chapter 156B of the General Laws of the Commonwealth
of Massachusetts:
VOTED, that as a result of the reacquisition by Town & Country Corporation
(the "Corporation") of shares of the Corporation's exchangeable preferred stock,
par value $1.00 per share (the "Exchangeable Preferred Stock"), the Board of
Directors of the Corporation, pursuant to Section 21A of Chapter 156B of the
General Laws of the Commonwealth of Massachusetts and pursuant to the
Certificate of Vote of Directors Establishing a Series of a Class of Stock dated
May 14, 1993 establishing the Exchangeable Preferred Stock, hereby restores such
reacquired shares of Exchangeable Preferred Stock to the status of authorized
but unissued shares of Preferred Stock of the Corporation and reduces the number
of shares of Exchangeable Preferred Stock authorized for issuance by the
Corporation from 2,700,000 shares to 200,000 shares.
VOTED, that pursuant to authority conferred upon the Board of Directors by
the Corporation's Articles of Organization, as amended as of the date hereof
(the "Articles"), the Board of Directors hereby establishes and designates a
series of Preferred Stock of the Corporation, and hereby fixes and determines
the relative rights and preferences of the shares of such series, in addition to
those set forth in the Articles of Organization, as follows:
Section 1. Designation, Amount and Liquidation Value.
The shares of the series of Preferred Stock shall be designated as
"Convertible Redeemable Preferred Stock," and the number of shares constituting
such series initially shall be 2,533,255; provided that pursuant to the terms of
this Certificate of Designation, the Corporation shall be authorized to issue
from time to time additional shares of Convertible Redeemable Preferred Stock
solely as payment in lieu of cash dividends payable on the Convertible
Redeemable Preferred Stock. Each share of Convertible Redeemable Preferred Stock
shall have a liquidation value equal to the sum of $6.50 (as adjusted to reflect
any stock dividend, subdivision, reclassification,
distribution or similar event relating to the Convertible Redeemable Preferred
Stock) plus the amount of accrued and unpaid dividends thereon (the "Liquidation
Value").
Section 2. Definitions.
"AMEX" means the American Stock Exchange.
"Board of Directors" means the Board of Directors of the
Corporation.
"Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions in the City of Boston or the Commonwealth of
Massachusetts or the State of New York are authorized or obligated by law or
executive order to close.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated and whether voting or nonvoting) corporate stock.
"Certificate of Designation" means the Certificate of Vote of
Directors Establishing a Series of a Class of Stock of the Corporation pursuant
to Section 26 of Chapter 156B of the General Laws of the Commonwealth of
Massachusetts, of which these votes form a part, creating the Convertible
Redeemable Preferred Stock and setting forth the terms, rights and preferences
thereof.
"Class A Common Stock" means the Class A Common Stock of the
Corporation, $.01 par value per share.
"Class B Common Stock" means the Class B Common Stock of the
Corporation, $.01 par value per share.
"Closing Date" means the date on which the shares of Convertible
Redeemable Preferred Stock are first issued.
"Conversion Notice" shall have the meaning set forth in
Section 5(c) hereof.
"Conversion Rate" shall have the meaning set forth in Section 5(a)
hereof, as adjusted from time to time pursuant to the provisions of Section 5(d)
hereof.
"Convertible Redeemable Preferred Stock" means the convertible
redeemable preferred stock of the Corporation, $1.00 par value per share,
established pursuant to this Certificate of Designation.
"Corporation Optional Conversion" shall have the meaning set forth in
Section 5(b) hereof.
"Corporation Optional Conversion Date" shall have the meaning set
forth in Section 5(c)(ii) hereof.
"Corporation Optional Conversion Notice" shall have the meaning set
forth in Section 5(c)(ii) hereof.
"Corporation Optional Redemption" shall have the meaning set forth in
Section 4(a) hereof.
"Dividend Period" shall mean the semi-annual periods commencing on
March 1 and September 1 of each year after the Closing Date and ending on and
including the day preceding the first day of the next succeeding Dividend
Period, provided that the Dividend Period for March 1, 1995 shall include the
period from the Closing Date up to March 1, 1995.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchangeable Preferred Stock" means the exchangeable preferred stock
of the Corporation, $1.00 par value per share.
"Fair Market Value" means the average of the Sale Price of a share of
Class A Common Stock for the 30 Trading Days immediately preceding the date on
which the Transfer Agent received a Conversion Notice or written notice of a
redemption, as the case may be.
"Holder" means the person in whose name shares of Convertible
Redeemable Preferred Stock are registered on the books of the Corporation.
"Junior Stock" means Class A Common Stock, Class B Common Stock, and
any other class or series of Capital Stock of the Corporation now or hereafter
issued and outstanding that ranks junior as to dividends and/or liquidation to
the Convertible Redeemable Preferred Stock.
"Lien" means any interest in property securing an obligation owed to,
or a claim by, a person other than the owner of the property, whether such
interest is based on the common law, statute or contract and including, without
limitation, any lien, security interest, mortgage, encumbrance, pledge, charge,
claim, hypothecation, assignment for security, deposit arrangement, conditional
sale or trust receipt, a lease, consignment or bailment for security purposes or
other security agreement of any kind or nature whatsoever. The term "Lien" shall
include stockholder agreements, voting trust agreements, buy-back agreements and
all similar arrangements.
"Liquidation Value" shall have the meaning set forth in
Section 1 hereof.
"NASDAQ" means the National Association of Securities Dealers
Automated Quotation System.
"New Senior Secured Notes" means the Corporation's 11 1/2%
Senior Secured Notes due September 15, 1997.
"New Senior Subordinated Notes" means the Corporation's 13%
Senior Subordinated Notes due May 31, 1998.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Chief Financial Officer, the Treasurer or
the Clerk of the Corporation.
"Officers' Certificate" means a certificate signed by two Officers,
one of whom must be the Chairman of the Board, the President, the Chief
Financial Officer, the Treasurer or a Vice President of the Corporation.
"Optional Conversion Date" shall have the meaning set forth in Section
5(c)(i) hereof.
"Person" means an individual, a corporation, a partnership, a joint
venture, an association, a joint-stock company, a trust, a business trust, a
government or any agency or any political subdivision, any unincorporated
organization, or any other entity.
"Redemption Date" means the date on which shares of Convertible
Redeemable Preferred Stock are to be redeemed pursuant to Section 4.
"Revised Debt Agreements" means, collectively, the Credit Agreement
dated as of May 14, 1993 by and among the Corporation and certain of its
subsidiaries and Foothill Capital Corporation, and each of the amended and
restated consignment agreements dated as of May 14, 1993 by and between the
Corporation and each of its gold suppliers in each such case, as the same may be
amended, modified or supplemented in accordance with their respective terms from
time to time, and any credit, consignment or other agreement pursuant to which
the Corporation or any of its subsidiaries replaces, renews, refunds, refinances
or extends borrowings under such credit agreement or any of such consignment
agreements.
"Sale Price" means, with respect to Class A Common Stock, for any
given day, the closing sale price (or, if no closing sale price is reported, the
average of the bid and ask prices or if more than one in either case, the
average of the average bid and ask prices on such day) of a share of such
security as reported by AMEX or, in the event that such security is not traded
on AMEX, such other national or regional securities exchange or automated
quotations system upon which such security is listed and principally traded or,
if no such price is available, the per share market value of such security as
determined by a nationally recognized investment banking firm or other
nationally recognized financial adviser retained by the Corporation for such
purpose; provided, however, that if any such date shall not be a Trading Day,
the Sale Price shall be based on the specified price on the Trading Day
preceding such date.
"First Anniversary Date" means the first anniversary of the
Closing Date.
"Securities Act" means the Securities Act of 1933, as amended.
"Significant Subsidiary" of any Person means any subsidiary or group
of subsidiaries which would, individually or in the aggregate, be a "Significant
Subsidiary" as defined in Rule 1.02 of Regulation S-X under the Securities Act.
"subsidiary" means, as to any particular parent corporation, any
corporation, association, partnership or other business entity of which more
than 50% of the Voting Stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by such parent corporation.
"Trading Day" means each day on which AMEX or such other securities
exchange or automated quotations system on which shares of Class A Common Stock
are traded is open for the transaction of business or, if such securities are
not listed or admitted for trading on AMEX, any other securities exchange or
NASDAQ, a Business Day.
"Transfer Agent" means State Street Bank & Trust Company as transfer
agent for the Convertible Redeemable Preferred Stock until a successor replaces
it in accordance with the terms of the Transfer Agent Agreement and, thereafter,
means such successor.
"Voting Stock" with respect to any Person means all classes of Capital
Stock of such Person then outstanding and normally entitled to vote for the
election of directors of such Person. Any reference to a percentage of Voting
Stock shall refer to the percentage of votes eligible to be cast for the
election of directors which are attributable to the applicable shares of Voting
Stock.
Section 3. Dividends.
(a) Payment of Dividends. After the Closing Date, the Holders of
Convertible Redeemable Preferred Stock shall be entitled to receive, when and as
declared by the Board of Directors, cash dividends at the rate per annum of 6%
of the Liquidation Value. Notwithstanding anything to the contrary set forth
herein, the Corporation shall not be obligated to declare or pay cash dividends
on the Convertible Redeemable Preferred Stock if (i) the Corporation does not
have sufficient funds legally available to pay such dividends; (ii) directors of
the Corporation could be held jointly and severally liable for the payment of
such dividends under Massachusetts law; or (iii) the payment of such dividends
is prohibited by the certificate of designation for the Exchangeable Preferred
Stock, the indenture for the New Senior Secured Notes, the indenture for the New
Senior Subordinated Notes or the Revised Debt Agreements (provided that, in the
case of any credit, gold consignment or other agreement pursuant to which the
Corporation or any of its subsidiaries replaces, renews, refinances or extends
borrowings under any of the Revised Debt Agreements, such dividend restriction
is no more restrictive than the dividend restriction set forth in such Revised
Debt Agreement entered into on May 14, 1993); provided, however, that dividends
on the Convertible Redeemable Preferred Stock shall accrue (whether or not
declared) from and including the Closing Date to and including the date on which
the Liquidation Value is paid on such shares or on which such shares are
converted or redeemed and, to the extent not paid for any Dividend Period, will
be cumulative. If the Corporation is prohibited from paying cash dividends on
the Convertible Redeemable Preferred Stock, then in lieu of any cash payment due
to the Holders in respect of such dividends, the Corporation shall issue
additional shares of Convertible Redeemable Preferred Stock having an aggregate
Liquidation Value equal to the amount of such dividend payments. Notwithstanding
anything to the contrary set forth herein, the issuance of additional shares of
Convertible Redeemable Preferred Stock (and the issuance of shares of Class A
Common Stock upon the automatic conversion of such shares of Convertible
Redeemable Preferred Stock as set forth in Section 5(c)(i) and Section 5(c)(ii)
hereof) in lieu of cash dividends for any Dividend Period shall be deemed to
have satisfied for all purposes the Corporation's requirement to pay such
dividends for such Dividend Period and such dividends shall cease to accrue upon
such issuance. If at any time the Corporation pays a portion of any dividends in
cash and a portion in additional shares of Convertible Redeemable Preferred
Stock, the cash portion and the share portion of such dividend payment shall be
distributed ratably among the Holders of Convertible Redeemable Preferred Stock
based upon the aggregate dividends payable on the shares of Convertible
Redeemable Preferred Stock held by such Holders. Dividends on the Convertible
Redeemable Preferred Stock, whether paid in cash or in shares of Convertible
Redeemable Preferred Stock, shall be payable semiannually, when and as declared
by the Board of Directors, on each March 1 and September 1 after the Closing
Date. Each such dividend shall be payable to Holders of Convertible Redeemable
Preferred Stock at the close of business on the record date, which record date
shall be not more than 60 days prior to the date fixed for payment thereof.
Dividends payable on the Convertible Redeemable Preferred Stock shall be
computed on the basis of a 360-day year consisting of twelve 30-day months.
(b) Distribution of Partial Dividend Payments. Except as otherwise
provided herein, if at any time the Corporation pays less than the total amount
of dividends then accrued with respect to the Convertible Redeemable Preferred
Stock, such payment shall be distributed ratably among the Holders of
Convertible Redeemable Preferred Stock based upon the aggregate accrued but
unpaid dividends on the shares of Convertible Redeemable Preferred Stock held by
such Holders.
(c) Certain Restrictions. So long as any shares of Convertible
Redeemable Preferred Stock are outstanding, no dividends or other distributions
shall be declared or paid or set apart for payment on any class or series of
Junior Stock unless the Corporation shall have deposited with the Transfer Agent
cash sufficient to pay the then-applicable redemption price for all shares of
Convertible Redeemable Preferred Stock then outstanding plus cash sufficient to
pay all accrued but unpaid dividends thereon; provided, however, that
notwithstanding the foregoing, the Corporation shall be able to make any
required payments under (i) the Registration Effectiveness Agreement, dated as
of May 14, 1993, by and between the Corporation and certain funds managed by
Fidelity Research & Management Company and Fidelity Management Trust Company and
(ii) the Registration Rights Agreement, dated as of the Closing Date, by and
between the Corporation and the Holders.
(d) Exceptions. As used in this Section 3, the term "dividend" shall
not include dividends payable solely in shares of Junior Stock, or options,
warrants or rights to subscribe for or purchase shares of any Junior Stock.
Section 4. Redemption.
(a) Optional Redemption. Shares of Convertible Redeemable Preferred
Stock may not be redeemed by the Corporation prior to the First Anniversary
Date. On and after the First Anniversary Date, to the extent permitted by law,
by the Revised Debt Agreements, by the indentures for the New Senior Secured
Notes and the New Senior Subordinated Notes, and by the certificate of
designation for the Exchangeable Preferred Stock, the Corporation may redeem
shares of Convertible Redeemable Preferred Stock in whole at any time or in part
from time to time at a redemption price per share set forth below (expressed as
a percentage of the Liquidation Value) if redeemed during the twelve-month
period beginning November 23 of the year indicated below (a "Corporation
Optional Redemption"):
Year Percentage
1995 104%
1996 102
1997 and thereafter 100
(b) Procedures for Redemption.
(i) If fewer than all the shares of Convertible Redeemable
Preferred Stock are to be redeemed, the number of shares of Convertible
Redeemable Preferred Stock to be redeemed from each Holder thereof in
redemptions hereunder shall be the number of shares determined by multiplying
the total number of shares of Convertible Redeemable Preferred Stock to be
redeemed by a fraction, the numerator of which shall be the total number of
shares of Convertible Redeemable Preferred Stock held by such Holder and the
denominator of which shall be the total number of shares of Convertible
Redeemable Preferred Stock then outstanding. Upon surrender of a stock
certificate of Convertible Redeemable Preferred Stock that is redeemed in part,
the Corporation shall execute and deliver or have delivered to a Holder (at the
Corporation's expense) a new stock certificate representing an amount equal to
the unredeemed portion of the stock certificate surrendered.
(ii) At least 45 days but not more than 60 days before the
Redemption Date, the Corporation or, at the Corporation's request, the Transfer
Agent shall mail a notice of redemption by first-class mail to each Holder. This
notice shall identify the shares of Convertible Redeemable Preferred Stock to be
redeemed and shall, among other things, state:
(A) the Redemption Date;
(B) the redemption price and the amount and type of
consideration being paid in connection with the redemption;
(C) the name and address of the Transfer Agent;
(D) that the shares of Convertible Redeemable
Preferred Stock called for redemption must be surrendered to the Transfer
Agent to collect the redemption price;
(E) if fewer than all of the outstanding shares of
Convertible Redeemable Preferred Stock are to be redeemed, the identification
and amounts of the shares of Convertible Redeemable Preferred Stock to be
redeemed, and that after the applicable Redemption Date, upon surrender of such
shares of Convertible Redeemable Preferred Stock, a new stock certificate equal
to the unredeemed portion will be issued; and
(F) the Conversion Rate and the date established
pursuant to Section 5(c)(iv) on which the right to convert the shares of
Convertible Redeemable Preferred Stock into Class A Common Stock shall expire
and instructions for converting the Convertible Redeemable Preferred Stock,
including the requirement that the shares of Convertible Redeemable Preferred
Stock to be converted must be delivered to the Transfer Agent to receive the
Class A Common Stock.
In the event that the Corporation shall mail the redemption notice to
Holders, a copy of such notice shall also be simultaneously mailed to the
Transfer Agent. Failure to give notice or any defect in the notice to any Holder
shall not affect the validity of the notice given to any other Holder.
(iii) In the case of a Corporation Optional Redemption made
pursuant to Section 4(a), the Corporation shall pay such redemption price in
cash. Not later than two (2) Business Days prior to the Redemption Date, the
Corporation shall deposit with the Transfer Agent cash sufficient to pay the
redemption price for all shares of Convertible Redeemable Preferred Stock to be
redeemed and any accrued and unpaid dividends thereon, whether or not declared;
provided that in lieu of paying cash in respect of such accrued and unpaid
dividends, the Corporation may pay such dividends in shares of Convertible
Redeemable Preferred Common Stock having an aggregate Liquidation Value equal to
the amount of such accrued but unpaid dividends. In the event that the
Corporation elects to pay such accrued but unpaid dividends with shares of
Convertible Redeemable Preferred Stock, immediately upon issuance such shares of
Convertible Redeemable Preferred Stock shall automatically and without further
action by the Corporation or the Holder be converted into shares of Class A
Common Stock at the then-applicable Conversion Rate.
(iv) As long as the Corporation has complied with the
requirements set forth in this Section 4(b), from and after the Redemption Date,
dividends on the shares of Convertible Redeemable Preferred Stock so called for
redemption shall cease to accrue, such shares shall be cancelled and shall no
longer be deemed to be outstanding, and all rights of the Holders thereof as
stockholders of the Corporation (except the right to receive from the
Corporation the redemption price and payment of all accrued but unpaid
dividends) shall cease.
Section 5. Conversion of Convertible Redeemable Preferred Stock.
(a) Conversion at Option of the Holder. At any time and from time to
time after the Closing Date, a Holder of Convertible Redeemable Preferred Stock
may surrender such stock, in whole or in part, for shares of Class A Common
Stock during the time periods set forth in Section 5(c)(iv). Initially a Holder
of Convertible Redeemable Preferred Stock shall receive two shares of Class A
Common Stock for each share of Convertible Redeemable Preferred Stock
surrendered for conversion subject to adjustment as set forth in Section 5(d)
(the "Conversion Rate").
(b) Conversion at Option of the Corporation. In the event that at any
time after the Closing Date, the Sale Price of Class A Common Stock shall equal
or exceed $3.25 per share (as adjusted to reflect any stock dividend,
subdivision, combination, reclassification, distribution or similar event
relating to the shares of Class A Common Stock) for 30 consecutive Trading Days,
the Corporation may require the Holders of the Convertible Redeemable Preferred
Stock in whole but not in part to convert their shares of
Convertible Redeemable Preferred Stock into shares of Class A
Common Stock at the then-applicable Conversion Rate (a
"Corporation Optional Conversion").
(c) Procedures and Method of Conversion.
(i) In order to convert shares of Convertible Redeemable
Preferred Stock, a Holder must surrender such shares of Convertible Redeemable
Preferred Stock to the Transfer Agent by physical delivery to the office of the
Transfer Agent maintained for that purpose, duly assigned or endorsed for
transfer to the Corporation (or accompanied by duly executed stock powers
relating thereto), accompanied by written notice of conversion (the "Conversion
Notice") and, to the extent required by Section 5(g) hereof, payment for all
transfer and similar taxes. Such Conversion Notice shall specify (i) the number
of shares of Convertible Redeemable Preferred Stock to be converted, (ii) the
name or names in which such Holder wishes the certificate or certificates for
Class A Common Stock and for any Convertible Redeemable Preferred Stock not to
be so converted to be issued and (iii) the address to which such Holder wishes
delivery to be made of such new certificates to be issued upon such conversion.
Any conversion shall be deemed to have been effected on the date on which all
such requirements set forth in the preceding sentence have been satisfied (the
"Optional Conversion Date"). Once received by the Transfer Agent, a Conversion
Notice shall be irrevocable and may not be withdrawn by a Holder for any reason.
The Transfer Agent shall promptly notify the Corporation of receipt by it of any
Conversion Notice. No later than five (5) Business Days following the Optional
Conversion Date, the Corporation shall deliver to the Transfer Agent (for
redelivery to the Holder) accrued and unpaid dividends on the Convertible
Redeemable Preferred Stock through and including the Optional Conversion Date
which such dividends may be paid in cash or in shares of Convertible Redeemable
Preferred Common Stock having an aggregate Liquidation Value equal to the amount
of such accrued but unpaid dividends. In the event that the Corporation elects
to pay such accrued but unpaid dividends with shares of Convertible Redeemable
Preferred Stock, immediately upon issuance such shares of Convertible Redeemable
Preferred Stock shall automatically and without further action by the
Corporation or the Holder be converted into shares of Class A Common Stock at
the then-applicable Conversion Rate. In addition, the Transfer Agent shall
deliver to the Holder the Class A Common Stock (at the Conversion Rate then in
effect) which such Holder is entitled to receive in accordance with the
provisions of this Certificate of Designation. Such conversion shall be deemed
to have been effected on the close of business on the Optional Conversion Date,
and at such time all rights of the Holder of such Convertible Redeemable
Preferred Stock as a Holder of Convertible Redeemable Preferred Stock (other
than the right to receive Class A Common Stock and accrued and unpaid dividends
on the Convertible Redeemable Preferred Stock) shall cease and the Holder shall,
as between such Holder and the Transfer Agent and the Corporation, be deemed to
have become the holder of record of the Class A Common Stock represented
thereby. Delivery of such certificate or certificates or execution of such
transfer, as the case may be, and delivery of immediately available funds for
any cash in payment of accrued and unpaid dividends on the shares of Convertible
Redeemable Preferred Stock being converted (subject to the Corporation's right
to pay such accrued and unpaid dividends in shares of Convertible Redeemable
Preferred Stock) as aforesaid may be delayed for a reasonable time at the
request of the Corporation in order to effectuate the calculation of adjustments
of the Conversion Rate pursuant to Section 5(d) or to make any governmental
filings or obtain any necessary governmental approvals required to be made or
obtained by the Corporation or the Holder converting its shares of Convertible
Redeemable Preferred Stock. If, between any Optional Conversion Date and the
related date of delivery of applicable Class A Common Stock, a record date or
effective date of a transaction described in Section 5(d) or 5(e) shall occur,
the Holder entitled to receive such Class A Common Stock shall be entitled only
to receive such Class A Common Stock as so modified on the date of the delivery,
and the Corporation and the Transfer Agent shall not be otherwise liable with
respect to the modification of such Class A Common Stock from such Optional
Conversion Date to the date of such delivery.
(ii) In the event of a Corporation Optional Conversion, the
Corporation shall provide written notice (the "Corporation Optional Conversion
Notice") to the Holders that the requirements of Section 5(b) have been met and
that the Corporation is requiring the conversion of all outstanding shares of
Convertible Redeemable Preferred Stock. For purposes of this Section 5(c)(ii),
the date of the Corporation Optional Conversion Notice shall be the "Corporation
Optional Conversion Date." The Corporation Optional Conversion Notice shall be
accompanied by a letter of transmittal describing the procedures by which the
Holders shall deliver all of their shares of Convertible Redeemable Preferred
Stock for conversion into Class A Common Stock. As of the Corporation Optional
Conversion Date and without any further action by the Corporation and without
any further notice, (i) all outstanding shares of Convertible Redeemable
Preferred Stock shall be deemed to have been converted into shares of Class A
Common Stock at the then-applicable Conversion Rate and such shares shall be
cancelled and shall no longer be deemed to be outstanding, (ii) dividends on the
Convertible Redeemable Preferred Stock shall cease to accrue, and (iii) all
rights of the Holders of the Convertible Redeemable Preferred Stock (except the
right to receive from the Corporation the shares of Class A Common Stock) shall
cease. In the event of a Corporation Optional Conversion, the Corporation shall
pay the amount of accrued but unpaid dividends on such shares of Convertible
Redeemable Preferred Stock in shares of Convertible Redeemable Preferred Stock
having an aggregate Liquidation Value equal to the amount of such accrued but
unpaid dividends, which such shares of Convertible Redeemable Preferred Stock
shall automatically and without further action by the Corporation or the Holder
be converted into shares of Class A Common Stock at the then-applicable
Conversion Rate.
(iii) If any Holder converts less than all of its shares of
Convertible Redeemable Preferred Stock, upon such conversion the Corporation
shall execute and deliver or have delivered to the Holder thereof, at the
expense of the Corporation, a new stock certificate or certificates representing
an amount equal to the unconverted shares of Convertible Redeemable Preferred
Stock.
(iv) With respect to any shares of Convertible Redeemable
Preferred Stock called for redemption, the right to convert such shares for
Class A Common Stock shall expire on the close of business on the day preceding
the Redemption Date if such shares have been called for redemption pursuant to
Section 4(a) and the Corporation shall have deposited with the Transfer Agent
cash sufficient to pay the redemption price for the shares to be redeemed in
accordance with the provisions of Section 4(b)(iii) hereof.
(d) Adjustment of Conversion Rate.
The Conversion Rate shall be subject to adjustment as follows:
(i) If at any time any shares of Convertible Redeemable
Preferred Stock are outstanding, the Corporation shall (A) pay a dividend or
make a distribution on Class A Common Stock in shares of such stock, (B)
subdivide outstanding shares of Class A Common Stock into a greater number of
shares of such stock, (C) combine outstanding shares of Class A Common Stock
into a smaller number of shares of such stock, or (D) issue, by reclassification
of shares of Class A Common Stock, any shares of any series of the Corporation's
Capital Stock, the Conversion Rate in effect immediately prior thereto shall be
proportionately adjusted so that the Holder of any Convertible Redeemable
Preferred Stock thereafter converted shall be entitled to receive upon such
conversion the number of shares of Class A Common Stock or other Capital Stock
as such Holder would have owned or would have been entitled to receive
immediately after the happening of any of the events described above, had such
Convertible Redeemable Preferred Stock been converted immediately prior to the
record date (or if there is no record date, the effective date) of such event.
Such adjustments shall be made whenever any of the events listed above shall
occur and shall become effective as of immediately after the close of business
on the record date in the case of a stock dividend and on the effective date in
the case of a subdivision or combination or reclassification. Any Holder
converting any Convertible Redeemable Preferred Stock after such record date or
such effective date, as the case may be, shall be entitled to receive shares of
Class A Common Stock or other Capital Stock at the Conversion Rate as so
adjusted pursuant to this Section 5(d)(i).
(ii) All calculations under this Section 5(d) shall be made
to the nearest one-one-thousandth (.001) of a share.
(iii) Whenever the Conversion Rate is adjusted as herein
provided, the Corporation shall determine the adjusted Conversion Rate in
accordance with the provisions of this Section 5(d) and shall prepare a
certificate setting forth such adjusted Conversion Rate and showing in detail
the facts upon which such adjustment is based, and such certificate shall
forthwith be filed with the Transfer Agent. A notice stating that the Conversion
Rate has been adjusted and setting forth the adjusted Conversion Rate shall as
soon as practicable be mailed by the Corporation or, at the Corporation's
request, the Transfer Agent to the Holders at their last addresses as they shall
appear upon the books of the Corporation.
(e) Distributions by Corporation. If at any time any shares of
Convertible Redeemable Preferred Stock are outstanding, the Corporation shall
distribute to all holders of its Class A Common Stock any of its assets or debt
securities, or rights, including purchase rights, options, warrants or
convertible or exchangeable securities of the Corporation (including securities
for cash, but excluding distributions of Capital Stock referred to in subsection
5(d)(i) above), then in each such case, the Holders of Convertible Redeemable
Preferred Stock shall be entitled to receive such rights, options, warrants or
convertible or exchangeable securities as such Holders would have been entitled
to receive had they converted their shares of Convertible Redeemable Preferred
Stock for shares of Class A Common Stock prior to the record date of any such
distribution.
(f) Fractional Interest. At its option, the Corporation may deliver
fractional shares of Class A Common Stock upon conversion of Convertible
Redeemable Preferred Stock or may instruct the Transfer Agent, on behalf of the
Corporation, to pay a cash adjustment in respect of such fractional interest in
an amount equal to the same fraction of the Fair Market Value per share of Class
A Common Stock. If more than one certificate representing shares of Convertible
Redeemable Preferred Stock shall be surrendered for conversion at one time by
the same Holder, the number of full shares of Class A Common Stock that shall be
delivered upon conversion shall be computed on the basis of the aggregate number
of shares of Convertible Redeemable Preferred Stock (or specified portion
thereof to the extent permitted hereby) so surrendered. In the event that the
Corporation shall elect to pay cash in lieu of any fractional interest, the
Corporation shall, upon conversion of any shares of Convertible Redeemable
Preferred Stock, provide cash to the Transfer Agent in an amount equal to the
cash adjustment payable with respect to any fractional shares of Class A Common
Stock deliverable upon conversion of such shares of Convertible Redeemable
Preferred Stock, and receive in consideration therefor such fractional shares.
(g) Taxes. The Corporation will pay any and all documentary, stamp,
transfer or similar taxes that may be payable in respect of the transfer and
delivery of Class A Common Stock pursuant hereto; provided, however, that the
Corporation shall not be required to pay any such tax that may be payable in
respect of any transfer involved in the delivery of Class A Common Stock in a
name other than that in which the shares of Convertible Redeemable Preferred
Stock so converted were registered, and no such transfer or delivery shall be
made unless and until the Person requesting such transfer 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.
(h) Shares Free and Clear. The Corporation hereby warrants that, upon
conversion of Convertible Redeemable Preferred Stock pursuant to this
Certificate of Designation, including upon conversion of shares of Convertible
Preferred Stock issued in lieu of payment of cash dividends, the Holders of
Convertible Redeemable Preferred Stock shall receive fully paid and
nonassessable shares of Class A Common Stock free and clear of any and all
Liens.
(i) Status upon Conversion. From and after the Optional Conversion
Date or the Corporation Optional Conversion Date, as the case may be, dividends
on the shares of Convertible Redeemable Preferred Stock so converted shall cease
to accrue, such shares shall be cancelled and shall no longer be deemed to be
outstanding, and all rights of the Holders thereof as stockholders of the
Corporation (except the right to receive the Class A Common Stock) shall cease.
(j) Assistance by Corporation. The Corporation shall assist and
cooperate with any Holder in making any governmental filings or obtaining
governmental approval required to be made or obtained by such Holder in
connection with any conversion of shares of Convertible Redeemable Preferred
Stock hereunder (including, without limitation, making any filings required to
be made by the Corporation).
(k) Reservation of Shares. The Corporation shall reserve, free from
any preemptive rights, out of its authorized but unissued Class A Common Stock
sufficient shares of Class A Common Stock to provide for the conversion of all
shares of Convertible Redeemable Preferred Stock from time to time outstanding,
including shares of Convertible Redeemable Preferred Stock issued in lieu of
cash dividend payments.
Section 6. Consolidation, Merger and Sale of Assets, etc.
The Corporation shall not consolidate with or merge into, or transfer all
or substantially all of its assets to, another Person unless (i) the Corporation
is the surviving entity and the Convertible Redeemable Preferred Stock is
unchanged or (ii) (A) the surviving, resulting or acquiring Person is a Person
organized under the laws of the United States, any state thereof or the District
of Columbia, or a Person organized under the laws of a foreign jurisdiction
whose equity securities are listed on a national securities exchange in the
United States or authorized for quotation on NASDAQ, and (B) the Corporation
shall make effective provision such that, upon consummation of such transaction,
the Holders of Convertible Redeemable Preferred Stock shall receive stock of the
surviving entity having substantially identical terms (including the conversion
rights for the Class A Common Stock set forth in Section 5) as the Convertible
Redeemable Preferred Stock.
Section 7. Voting Rights of Convertible Redeemable Preferred
Stock.
(a) General. Except as otherwise expressly provided herein or as
required by law, the Holder of each share of Convertible Redeemable Preferred
Stock shall be entitled to vote on all matters on which the holders of Class A
Common Stock are entitled to vote. Each share of Convertible Redeemable
Preferred Stock shall entitle the Holder thereof to such number of votes per
share as shall equal the number of shares of Class A Common Stock into which
each share of Convertible Redeemable Preferred Stock is then convertible. Except
as provided in Section 7(b) hereof or as required by law, the holders of shares
of the Convertible Redeemable Preferred Stock and the Class A Common Stock shall
vote together as a single class on all matters.
(b) Certain Amendments. So long as any shares of Convertible
Redeemable Preferred Stock remain outstanding:
(i) the affirmative vote of the Holders of 100% of the
outstanding shares of Convertible Redeemable Preferred Stock, voting together as
a separate class, shall be required in order to change (A) the amount of the
Liquidation Value or the dividend rate of, or any provision of Section 3 hereof
relating to the calculation of the dividend on, the Convertible Redeemable
Preferred Stock or (B) subsection 4(a), any provision of Section 5 hereof
relating to the conversion rights of Holders of Convertible Redeemable Preferred
Stock, or this Section 7; and
(ii) the affirmative vote of the Holders of at least 75% of the
outstanding shares of Convertible Redeemable Preferred Stock, voting together as
a separate class, shall be required in order to (A) amend, alter or repeal any
of the provisions of the Articles or this Certificate of Designation so as to
adversely affect any right, preference or voting power of the Convertible
Redeemable Preferred Stock or (B) authorize, create or issue any class or series
of stock of the Corporation that is senior to or pari passu with the Convertible
Redeemable Preferred Stock with respect to dividends or the distribution of
assets upon dissolution, liquidation or winding up of the Corporation.
The foregoing voting provisions shall not apply if, at or prior to the
time when the action with respect to which such vote would otherwise be required
to be effected, all outstanding shares of Convertible Redeemable Preferred Stock
(i) shall have been redeemed or notice of redemption shall have been provided
and sufficient funds shall have been delivered to the Transfer Agent to effect
such redemption and/or (ii) shall have been converted into shares of Class A
Common Stock.
Section 8. Certain Restrictions.
So long as any shares of Convertible Redeemable Preferred Stock are
outstanding, the Corporation shall not redeem, retire, purchase or otherwise
acquire any shares of Junior Stock.
Section 9. Transfer Agent.
Simultaneously with the creation and issuance of the Convertible Redeemable
Preferred Stock in accordance with the terms of this Certificate of Designation,
the Corporation is amending its existing agreement with the Transfer Agent to
provide that the Transfer Agent shall also act as the Transfer Agent for the
Convertible Redeemable Preferred Stock. The duties of the Transfer Agent and
certain rights of the Corporation and the Holders of Convertible Redeemable
Preferred Stock with respect to the transfer of shares of Convertible Redeemable
Preferred Stock and the redemption of shares of Convertible Redeemable Preferred
Stock for cash by the Corporation are set forth in the transfer agent agreement,
as so amended.
Section 10. Transfers; Replacement of Certificates.
(a) Transfers. Subject to any restrictions on transfer under
applicable securities or other laws, shares of Convertible Redeemable Preferred
Stock may be transferred on the books of the Corporation by the surrender to the
Transfer Agent of the certificate therefor properly endorsed or accompanied by a
written assignment and power of attorney properly executed, with transfer stamps
(if necessary) affixed, and such proof of the authenticity of signature as the
Corporation or the Transfer Agent may reasonably require.
(b) Replacement of Certificates. If any mutilated certificate
representing shares of Convertible Redeemable Preferred Stock is surrendered to
the Transfer Agent, or if a Holder claims the certificate representing shares of
Convertible Redeemable Preferred Stock has been lost, destroyed or willfully
taken, the Corporation shall issue and the Transfer Agent shall countersign a
replacement certificate of like tenor and date if (i) the Holder provides an
indemnity bond or other security sufficient, in the judgment of the Transfer
Agent, to protect the Corporation, the Transfer Agent, and any authenticating
agent and any of their officers, directors, employees or representatives from
any loss which any of them may suffer if a certificate representing shares of
Convertible Redeemable Preferred Stock is replaced and (ii) the Holder satisfies
any other reasonable requirements of the Transfer Agent.
Section 11. Liquidation.
Upon any liquidation, dissolution or winding up of the Corporation, the
Holders of shares of Convertible Redeemable Preferred Stock shall be entitled to
receive, out of the assets or surplus funds of the Corporation available for
distribution, cash equal to the Liquidation Value per share of each outstanding
share of Convertible Redeemable Preferred Stock. No distribution in respect of
any such liquidation, dissolution or winding up shall be made (A) to the holders
of shares of Junior Stock unless, prior thereto, the Holders of shares of
Convertible Redeemable Preferred Stock shall have been paid in cash the
Liquidation Value for each outstanding share of Convertible Redeemable Preferred
Stock or (B) to the holders of any other class or series of stock ranking on a
parity (either as to dividends or upon liquidation, dissolution or winding up)
with the Convertible Redeemable Preferred Stock, except distributions made
ratably on the Convertible Redeemable Preferred Stock and all other such parity
stock in proportion to the total amounts to which the holders of all such shares
are entitled upon such liquidation, dissolution or winding up. If the assets or
surplus funds to be distributed to the Holders of Convertible Redeemable
Preferred Stock upon any such liquidation, dissolution or winding up are
insufficient to permit the payment to such Holders of their full preferential
amount, the assets and surplus funds legally available for distribution shall be
distributed ratably among the Holders of Convertible Redeemable Preferred Stock
in proportion to the full preferential amount each such Holder is otherwise
entitled to receive.
Neither the consolidation of nor merging of the Corporation with or into
any other Person, nor the sale or other transfer of all or substantially all of
the assets of the Corporation to another Person, shall be deemed to be a
liquidation, dissolution or winding up of the Corporation within the meaning of
this Section 11.
Section 12. Rank.
All shares of Convertible Redeemable Preferred Stock shall rank junior,
both as to payment of dividends and as to distributions of assets upon
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary, to all shares of Exchangeable Preferred Stock.
124471.c7
IN WITNESS WHEREOF AND UNDER THE PENALTIES OF PERJURY, we have
hereto signed our names this
23rd day of November in the year 1994.
/s/ C. William Carey, President/
/s/ Richard E. Floor, Clerk/
THE COMMONWEALTH OF MASSACHUSETTS
Certificate of Vote of Directors Establishing
A Series of a Class of Stock
(General Laws, Chapter 156B, Section 26)
I hereby approve the within certificate and, the
filing fee in the amount of $
having been paid, said certificate is hereby filed this
day of ,1994.
MICHAEL JOSEPH CONNOLLY
Secretary of State
TO BE FILLED IN BY CORPORATION
PHOTO COPY OF CERTIFICATE TO BE SENT
TO: Elliot J. Mark, Esq.
Goodwin, Procter & Hoar
Exchange Place
Boston, MA 02109
Telephone: (617) 570-1452
Copy Mailed