Exhibit 4.30
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF
15% SERIES F CUMULATIVE CONVERTIBLE PREFERRED STOCK
OF
AMERICAN TELESOURCE INTERNATIONAL, INC.
Pursuant to Section 151 of the General Corporation Law of the State of
Delaware, American TeleSource International, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), hereby certifies that the Board of Directors of the Corporation
on March 15, 2001 adopted resolutions by unanimous written consent adopting this
Certificate of Designation, Preferences and Rights designating a new class of
its preferred stock called the 15% Series F Cumulative Convertible Preferred
Stock, having the terms set forth herein, and that the Corporation has caused
this Certificate of Designation, Preferences and Rights to be executed by a duly
authorized officer as of the 21st day of March, 2001.
15% Series F Cumulative Convertible Preferred Stock
ARTICLE 1
Definitions
The terms defined in this Article whenever used in this Certificate of
Designation have the following respective meanings:
(a) "Affiliate" has the meaning ascribed to such term in Rule 12b-2
under the Securities Exchange Act of 1934, as amended.
(b) "AMEX" means the American Stock Exchange, Inc.
(c) "Business Day" means a day other than Saturday, Sunday or any day
on which banks located in the State of New York are authorized or obligated to
close.
(d) "Capital Shares" means the Common Shares and any other shares of
any other class or series of capital stock, whether now or hereafter authorized
and however designated, which have the right to participate in the distribution
of earnings and assets (upon dissolution, liquidation or winding-up) of the
Corporation.
(e) "Closing Date" means the Issue Date.
(f) "Common Shares" or "Common Stock" means shares of common stock,
par value $0.001 per share, of the Corporation.
(g) "Common Stock Issued at Conversion" when used with reference to
the securities issuable upon conversion of the Series F Preferred Stock, means
all Common Shares now or hereafter Outstanding and securities of any other class
or series into which the Series F Preferred Stock hereafter shall have been
changed or substituted, whether now or hereafter created and however designated.
(h) "Conversion Date" means any day on which all or any portion of
shares of the Series F Preferred Stock is converted in accordance with the
provisions hereof.
(i) "Conversion Notice" has the meaning set forth in Section 6.2.
(j) "Conversion Price" means on any date of determination the
applicable price for the conversion of shares of Series F Preferred Stock into
Common Shares on such day as set forth in Section 6.1.
(k) "Corporation" means American TeleSource International, Inc., a
Delaware corporation, and any successor or resulting corporation by way of
merger, consolidation or otherwise.
(l) "Current Market Price" means on any date of determination the
last sale price of a Common Share on such day as reported on the AMEX; provided,
if such security is not listed or admitted to trading on the AMEX, as reported
on the principal national security exchange or quotation system on which such
security is quoted or listed or admitted to trading, or, if not quoted or listed
or admitted to trading on any national securities exchange or quotation system,
the closing bid price of such security on the over-the-counter market on the day
in question as reported by Bloomberg LP, or a similar generally accepted
reporting service, as the case may be, for such day. If the Current Market Price
cannot be calculated for such security on any such date in the manner provided
above, the Current Market Price shall be the fair market value as determined by
the Board of Directors acting in good faith.
(m) "Holder" means any Person or Persons who is the holder of record
of the Series F Preferred Stock as shown in the Corporation's stock transfer
records.
(n) "Issue Date" has the meaning set forth in Section 6.1.
(o) "Market Disruption Event" means any event that results in a
material suspension or limitation of trading of the Common Shares on the AMEX or
the principal securities exchange on which the Common Shares are traded.
(p) "Market Price" per Common Share, on any date of determination,
means the arithmetic mean of the average closing prices of the Common Shares as
reported on the AMEX for the five (5) Trading Days immediately preceding such
date of determination; provided, if such security is not listed or admitted to
trading on the AMEX, as reported on the principal national security exchange or
quotation system on which such security is quoted or listed or admitted to
trading, or, if not quoted or listed or admitted to trading on any national
securities exchange or quotation system, the closing bid price of such security
on the over-the-counter market on the day in question as reported by Bloomberg
LP, or a similar generally accepted reporting service, as the case may be, for
the five (5) Trading Days immediately preceding such date of determination. If
the Market Price cannot be calculated for such security on any such
determination date in the manner provided above, the Market Price shall be the
fair market value as determined by the Board of Directors acting in good faith.
(q) "Outstanding" when used with reference to Common Shares or
Capital Shares (collectively, "Shares"), means, on any date of determination,
all issued and outstanding Shares, and includes all such Shares issuable in
respect of outstanding scrip or any certificates representing fractional
interests in such Shares; provided, however, that any such Shares directly or
indirectly owned or held by or for the account of the Corporation or any
Subsidiary of the Corporation shall not be deemed "Outstanding" for purposes
hereof.
(r) "Person" means an individual, a corporation, a partnership, an
association, a limited liability company, an unincorporated business
organization, a trust or other entity or organization, and any government or
political subdivision or any agency or instrumentality thereof.
(s) "SEC" means the United States Securities and Exchange Commission.
(t) "Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC thereunder, all as in effect at the
time.
(u) "Securities Purchase Agreement" means that certain Securities
Purchase Agreement dated as of March 21, 2001 between the Corporation and the
Buyers named therein, including any amendments or supplements thereto.
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(v) "Series F Preferred Shares" or "Series F Preferred Stock" means
the shares of 15% Series F Cumulative Convertible Preferred Stock of the
Corporation or such other convertible Preferred Stock exchanged therefor.
(w) "Stated Value" has the meaning set forth in Article 2.
(x) "Subsidiary" means any entity of which securities or other
ownership interests having ordinary voting power to elect a majority of the
board of directors or other persons performing similar functions are owned
directly or indirectly by the Corporation.
(y) "Trading Day" means any day on which purchases and sales of
securities authorized for quotation on the AMEX (or if the Common Stock is not
listed on the AMEX, then on the principal national securities exchange or
quotation system on which the Common Stock is listed or admitted to trading) are
reported thereon and on which no Market Disruption Event has occurred.
All references to "cash" or "$" herein means currency of the United
States of America.
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ARTICLE 2
Designation And Amount
The designation of this series, which consists of 40,000 shares of
Preferred Stock, is 15% Series F Cumulative Convertible Preferred Stock (the
"Series F Preferred Stock") and the stated value shall be $100.00 per share (the
"Stated Value").
ARTICLE 3
Rank
The Series F Preferred Stock shall rank (i) prior to the Common Stock;
(ii) prior to any class or series of capital stock of the Corporation hereafter
created other than "Pari Passu Securities" (collectively, with the Common Stock,
"Junior Securities"); (iii) pari passu with the Corporation's 10% Series A
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Cumulative Convertible Preferred Stock, 6% Series B Cumulative Convertible
Preferred Stock, 6% Series C Cumulative Convertible Preferred Stock, 6% Series D
Cumulative Convertible Preferred Stock and 6% Series E Cumulative Convertible
Preferred Stock and any class or series of capital stock of the Corporation
hereafter created specifically ranking on parity with the Series F Preferred
Stock ("Pari Passu Securities"); and (iv) junior to any class or series of
capital stock of the Corporation hereafter created (with the consent of the
holders of the Series F Preferred Stock in accordance with Article 8 hereof)
specifically ranking, by its terms, senior to the Series F Preferred Stock
("Senior Securities"), in each case as to distribution of assets upon
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary.
ARTICLE 4
Dividends
(a) (i) The Holder 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 (subject to Article 4(a)(ii) hereof) at the rate
of fifteen percent (15%) per annum (computed on the basis of a 360-day year)
(the "Dividend Rate") on the Stated Value of each share of Series F Preferred
Stock on and as of the most recent Dividend Payment Due Date (as defined below)
with respect to each Dividend Period (as defined below). Dividends on the Series
F Preferred Stock shall be cumulative from the date of issue, whether or not
declared for any reason, including if such declaration is prohibited under any
outstanding indebtedness or borrowings of the Corporation or any of its
Subsidiaries, or any other contractual provision binding on the Corporation or
any of its Subsidiaries, and whether or not there shall be funds legally
available for the payment thereof.
(ii) Each dividend shall be payable in equal quarterly amounts
on each March 31, June 30, September 30 and December 31 of each year or, if any
such date is not a business day, on the next succeeding business day (each, a
"Dividend Payment Due Date"), commencing June 30, 2001, to the holders of record
of shares of the Series F Preferred Stock, as they appear on the stock records
of the Corporation at the close of business on any record date, not more than 60
days or less than 10 days preceding the payment dates thereof, as shall be fixed
by the Board of Directors. For the purposes hereof, "Dividend Period" means the
period commencing on and including April 1, 2001 through June 30, 2001 and
thereafter each quarterly period commencing on the day after the immediately
preceding Dividend Payment Due Date and ending on and including the immediately
subsequent Dividend Payment Due Date. Accrued and unpaid dividends for any past
Dividend Period may be declared and paid at any time, without reference to any
Dividend Payment Due Date, to holders of record on such date, not more than 15
days preceding the payment date thereof, as may be fixed by the Board of
Directors.
(iii) All dividends shall be paid through the issuance of duly
and validly authorized and issued, fully paid and non-assessable shares of the
Common Stock valued at the Conversion Price in effect as of the Dividend Payment
Due Date.
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(b) The Holder shall not be entitled to any dividends in excess of
the cumulative dividends, as herein provided, on the Series F Preferred Stock.
Except as provided in this Article 4, no interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or payments on the
Series F Preferred Stock that may be in arrears.
(c) So long as any shares of the Series F Preferred Stock are
outstanding, no dividends, except as described in the next succeeding sentence,
shall be declared or paid or set apart for payment on Pari Passu Securities for
any period unless full cumulative dividends required to be paid in shares of the
Common Stock have been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof set apart for such payment on the
Series F Preferred Stock for all Dividend Periods terminating on or prior to the
date of payment of the dividend on such class or series of Pari Passu
Securities. When dividends are not paid in full or a sum sufficient for such
payment is not set apart, as aforesaid, all dividends declared upon shares of
the Series F Preferred Stock and all dividends declared upon any other class or
series of Pari Passu Securities shall be declared ratably in proportion to the
respective amounts of dividends accumulated and unpaid on the Series F Preferred
Stock and accumulated and unpaid on such Pari Passu Securities.
(d) So long as any shares of the Series F Preferred Stock are
outstanding, no dividends shall be declared or paid or set apart for payment or
other distribution declared or made upon Junior Securities, nor shall any Junior
Securities be redeemed, purchased or otherwise acquired (other than a
redemption, purchase or other acquisition of shares of Common Stock made for
purposes of an employee incentive or benefit plan (including a stock option
plan) of the Corporation or any subsidiary or any cashless exercise of
warrants), (all such dividends, distributions, redemptions or purchases being
hereinafter referred to as a "Junior Securities Distribution") for any
consideration (or any moneys be paid to or made available for a sinking fund for
the redemption of any shares of any such stock) by the Corporation, directly or
indirectly, unless in each case (i) the full cumulative dividends required to be
paid in shares of the Common Stock on all outstanding shares of the Series F
Preferred Stock and in such form as may be required on any other Pari Passu
Securities shall have been paid or set apart for payment for all past Dividend
Periods with respect to the Series F Preferred Stock and all past dividend
periods with respect to such Pari Passu Securities, and (ii) sufficient funds or
shares of the Common Stock, as the case may be, shall have been paid or set
apart for the payment of the dividend for the current Dividend Period with
respect to the Series F Preferred Stock and the current dividend period with
respect to such Pari Passu Securities.
ARTICLE 5
Liquidation Preference
(a) If the Corporation shall commence a voluntary case under the
Federal bankruptcy laws or any other applicable Federal or state bankruptcy,
insolvency or similar law, or consent to the entry of an order for relief in an
involuntary case under any law or to the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or other similar official) of the
Corporation or of any substantial part of its property, or make an assignment
for the benefit of its creditors, or admit in writing its inability to pay its
debts generally as they become due, or if a decree or order for relief in
respect of the Corporation shall be entered by a court having jurisdiction in
the premises in an involuntary case under the Federal bankruptcy laws or any
other applicable Federal or state bankruptcy, insolvency or similar law
resulting in the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or other similar official) of the Corporation or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and any such decree or order shall be unstayed and in effect for a
period of 30 consecutive days and, on account of any such event, the Corporation
shall liquidate, dissolve or wind up, or if the Corporation shall otherwise
liquidate, dissolve or wind up (each such event being considered a "Liquidation
Event"), no distribution shall be made to the holders of any shares of Common
Stock or Junior Securities of the Corporation upon liquidation, dissolution or
winding-up unless prior thereto, the holders of shares of Series F Preferred
Stock, subject to this Article 5, shall have received the Liquidation Preference
(as defined in Article 5(b)) with respect to each share. If upon the occurrence
of a Liquidation Event, the assets and funds legally available for distribution
among the holders of the Series F Preferred Stock and holders of Pari Passu
Securities shall be insufficient to permit the payment to such holders of the
preferential amounts payable thereon, then the entire
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assets and funds of the Corporation legally available for distribution to the
Series F Preferred Stock and the Pari Passu Securities shall be distributed
ratably among such shares in proportion to the ratio that the liquidation
preference payable on each such share bears to the aggregate liquidation
preference payable on all such shares.
(b) For purposes hereof, the "Liquidation Preference" with respect to
a share of the Series F Preferred Stock shall mean an amount equal to the sum of
(i) the Stated Value thereof plus (ii) the aggregate of all accrued and unpaid
dividends on such share of Series F Preferred Stock until the most recent
Dividend Payment Due Date; provided that, in the event of an actual liquidation,
dissolution or winding up of the Corporation, the amount referred to in clause
(ii) above shall be calculated by including accrued and unpaid dividends to the
actual date of such liquidation, dissolution or winding up, rather than the
Dividend Payment Due Date referred to above.
ARTICLE 6
Conversion of Preferred Stock; Redemption
Section 6.1 Conversion; Conversion Price.
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(a) At the option of the Holder, the shares of Series F Preferred
Stock may be converted, either in whole or in part (in whole shares of Series F
Preferred Stock), into Common Shares (calculated as to each such conversion to
the nearest 1/100th of a share of Common Stock), at any time, and from time to
time following the date of the First Closing (as defined in the Securities
Purchase Agreement) (the "Issue Date") at the following Conversion Price per
share of Common Stock: (i) during the period beginning on the Issue Date and
ending on the first anniversary of the Issue Date (the "First Anniversary"), the
Conversion Price shall equal $0.54; (ii) during the period from and after the
First Anniversary and ending on the second anniversary of the Issue Date (the
"Second Anniversary"), the Conversion Price shall equal the Market Price on the
First Anniversary; and (iii) at all times from and after the Second Anniversary,
the Conversion Price shall equal the Market Price on the Second Anniversary. The
amount of accrued and unpaid dividends as of the Conversion Date shall be paid
in Common Stock valued at the Market Price on the Conversion Date.
(b) The number of shares of Common Stock due upon conversion of
Series F Preferred Stock shall be (i) the number of shares of Series F Preferred
Stock to be converted, multiplied by (ii) the Stated Value and divided by (iii)
the applicable Conversion Price. Notwithstanding any other provision herein, the
Conversion Price shall not be less than the par value of the Common Stock.
(c) If the number of shares of Common Stock outstanding at any time
after the date hereof is increased by a stock dividend payable in shares of
Common Stock or by a subdivision or split-up of shares of Common Stock, then, on
the date such payment is made or such change is effective, the Conversion Price
shall be appropriately decreased so that the number of shares of Common Stock
issuable on conversion of any shares of Convertible Preferred Stock shall be
increased in proportion to such increase of outstanding shares of Common Stock.
(d) If the number of shares of Common Stock outstanding at any time
after the date hereof is decreased by a combination or reverse split of the
outstanding shares of Common Stock, then, on the effective date of such
combination or reverse split, the Conversion Price shall be appropriately
increased so that the number of shares of Common Stock issuable on conversion of
any shares of Convertible Preferred Stock shall be decreased in proportion to
such decrease in outstanding shares of Common Stock.
Section 6.2 Exercise of Conversion Privilege.
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(a) Conversion of the Series F Preferred Stock may be exercised, in
whole or in part, by the Holder by telecopying to the Corporation an executed
and completed notice of conversion in form and substance satisfactory to the
Corporation (the "Conversion Notice"). Each date on which a Conversion Notice is
telecopied to the Corporation in accordance with the provisions of this Section
6.2 shall constitute a Conversion Date. The Corporation shall convert the Series
F Preferred Stock and issue the Common Stock Issued at Conversion to be
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issued upon conversion thereof, and all voting and other rights associated with
the beneficial ownership of such Common Stock Issued at Conversion to be issued
upon conversion thereof shall vest with the Holder, effective as of the
Conversion Date. The Conversion Notice also shall state the name or names (with
addresses) of the Persons who are to become the holders of the Common Stock
Issued at Conversion in connection with such conversion. The Holder shall
deliver the shares of Series F Preferred Stock to the Corporation within 30 days
following the date on which the telecopied Conversion Notice has been
transmitted to the Corporation. Upon surrender for conversion, the Series F
Preferred Stock shall be accompanied by a proper assignment thereof to the
Corporation or be endorsed in blank. As promptly as practicable after the
receipt of the Conversion Notice as aforesaid, but in any event not more than
five (5) Business Days after the Corporation's receipt of such Conversion Notice
and the Series F Preferred Stock being converted, the Corporation shall (i)
issue the Common Stock Issued at Conversion in accordance with the provisions of
this Article 6, (ii) cause to be mailed for delivery by overnight courier to the
Holder a certificate or certificate(s) representing the number of Common Shares
to which the Holder is entitled by virtue of such conversion and (iii) remit, in
immediately available funds, payment as provided in Section 6.3 in respect of
any fraction of a Common Share issuable upon such conversion and payment in the
amount of accrued and unpaid dividends as of the Conversion Date. Such
conversion shall be deemed to have been effected on the Conversion Date, and the
rights of the Holder of the Series F Preferred Stock, as such, shall cease and
the Person or Persons in whose name or names the Common Stock Issued at
Conversion shall be issuable shall be deemed to have become the holder or
holders of record of the Common Shares represented thereby and all voting and
other rights associated with the beneficial ownership of such Common Shares
shall at such time vest with such Person or Persons. The Conversion Notice shall
constitute a contract between the Holder and the Corporation, whereby the Holder
shall be deemed to subscribe for the number of Common Shares which it will be
entitled to receive upon such conversion and, in payment and satisfaction of
such subscription (and for any cash adjustment to which it is entitled pursuant
to Section 6.4), to surrender the Series F Preferred Stock and to release the
Corporation from all liability thereon. No cash payment aggregating less than
$1.00 shall be required to be given unless specifically requested by the Holder.
(b) If, at any time (i) the Corporation challenges, disputes or denies
the right of the Holder hereof to effect the conversion of the Series F
Preferred Stock into Common Shares or otherwise dishonors or rejects any
Conversion Notice delivered in accordance with this Section 6.2 or (ii) any
third party who is not and has never been an Affiliate of the Holder commences
any lawsuit or proceeding or otherwise asserts any claim before any court or
public or governmental authority which seeks to challenge, deny, enjoin, limit,
modify, delay or dispute the right of the Holder hereof to effect the conversion
of the Series F Preferred Stock into Common Shares, then the Holder shall have
the right, by written notice to the Corporation, to require the Corporation to
promptly redeem, to the extent permitted by law, the Series F Preferred Stock
for cash at a redemption price equal to 100% of the Stated Value thereof
together with all accrued and unpaid dividends thereon (the "Mandatory Purchase
Amount"). Under any of the circumstances set forth above, the Corporation shall
be responsible for the payment of all costs and expenses of the Holder,
including reasonable legal fees and expenses, as and when incurred in disputing
any such action or pursuing its rights hereunder (in addition to any other
rights of the Holder).
(c) The Holder shall be entitled to exercise its conversion privilege
notwithstanding the commencement of any case under 11 U.S.C.(S)101 et seq. (the
"Bankruptcy Code"). In the event the Corporation is a debtor under the
Bankruptcy Code, the Corporation hereby waives to the fullest extent permitted
any rights to relief it may have under 11 U.S.C.(S)362 in respect of the
Holder's conversion privilege. The Corporation hereby waives to the fullest
extent permitted any rights to relief it may have under 11 U.S.C. (S)362 in
respect of the conversion of the Series F Preferred Stock. The Corporation
agrees, without cost or expense to the Holder, to take or consent to any and all
action necessary to effectuate relief under 11 U.S.C.(S)362.
Section 6.3 Fractional Shares.
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No fractional Common Shares or scrip representing fractional Common Shares
shall be issued upon conversion of the Series F Preferred Stock. Instead of any
fractional Common Shares which otherwise would be issuable upon conversion of
the Series F Preferred Stock, the Corporation shall pay a cash adjustment in
respect of
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such fraction in an amount equal to the same fraction times the Market Price per
Common Share. No cash payment of less than $1.00 shall be required to be given
unless specifically requested by the Holder.
Section 6.4 Reclassification, Consolidation, Merger or Mandatory Share Exchange.
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At any time while the Series F Preferred Stock remains outstanding and
any shares thereof have not been converted, in case of any reclassification or
change of Outstanding Common Shares issuable upon conversion of the Series F
Preferred Stock (other than a change in par value, or from par value to no par
value per share, or from no par value per share to par value or as a result of a
subdivision or combination of outstanding securities issuable upon conversion of
the Series F Preferred Stock) or in case of any consolidation, merger or
mandatory share exchange of the Corporation with or into another corporation
(other than a merger or mandatory share exchange with another corporation in
which the Corporation is a continuing corporation and which does not result in
any reclassification or change, other than a change in par value, or from par
value to no par value per share, or from no par value per share to par value, or
as a result of a subdivision or combination of Outstanding Common Shares upon
conversion of the Series F Preferred Stock), or in the case of any sale or
transfer to another corporation of the property of the Corporation as an
entirety or substantially as an entirety, the Corporation will not effect any
such action unless the Corporation, or such successor, resulting or purchasing
corporation, as the case may be, shall, without benefit of any additional
consideration therefor, issue a new preferred stock providing that the Holder
shall have the right to convert such new preferred stock (upon terms and
conditions not less favorable to the Holder than those in effect pursuant to the
Series F Preferred Stock) and to receive upon such exercise, in lieu of each
Common Share theretofore issuable upon conversion of the Series F Preferred
Stock, the kind and amount of shares of stock, other securities, money or
property receivable upon such reclassification, change, consolidation, merger,
mandatory share exchange, sale or transfer by the holder of one Common Share
issuable upon conversion of the Series F Preferred Stock had the Series F
Preferred Stock been converted immediately prior to such reclassification,
change, consolidation, merger, mandatory share exchange or sale or transfer. The
provisions of this Section 6.4 shall similarly apply to successive
reclassifications, changes, consolidations, mergers, mandatory share exchanges
and sales and transfers.
Section 6.5 Optional Redemption and Optional Conversion.
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At any time from and after the First Anniversary to the extent
permitted by law, the Corporation, upon notice delivered to the Holder as
provided in Section 6.6, may redeem all (but not less than all) of the then
outstanding shares of the Series F Preferred Stock (but only with respect to
such shares as to which the Holder has not theretofore furnished a Conversion
Notice in compliance with Section 6.2), at 100% of the Stated Value, together
with all accrued and unpaid dividends thereon to the date of redemption (the
"Redemption Date"); provided, however, that the Corporation may only redeem the
Series F Preferred Stock under this Section 6.6 if for any period of 20
consecutive Trading Days ending at any time prior to the Redemption Date, the
Current Market Price on each outstanding Trading Day is greater than or equal to
200% of the Conversion Price in effect on each such Trading Day. Except as set
forth in this Section 6.5, the Corporation shall not have the right to prepay or
redeem the Series F Preferred Stock.
Section 6.6 Notice of Redemption.
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Notice of redemption pursuant to Section 6.5 shall be provided by the
Corporation to the Holder in writing (by registered mail or overnight courier at
the Holder's last address appearing in the Corporation's security registry) not
less than 10 nor more than 15 days prior to the Redemption Date, which notice
shall specify the Redemption Date and refer to Section 6.6 (including a
statement of the Market Price per Common Share) and this Section 6.6.
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Section 6.7 Surrender of Preferred Stock.
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Upon any redemption of the Series F Preferred Stock pursuant to Section
6.5, the Holder shall either deliver the Series F Preferred Stock by hand to the
Corporation at its principal executive offices or surrender the same to the
Corporation at such address by express courier. Payment of the optional
Redemption Price specified in Section 6.5 shall be made by the Corporation to
the Holder against receipt of the Series F Preferred Stock (as provided in this
Section 6.7) by wire transfer of immediately available funds to such account(s)
as the Holder shall specify to the Corporation. If payment of such redemption
price is not made in full by the later of the delivery of the shares of Series F
Preferred Stock or the Redemption Date, the Holder shall again have the right to
convert the Series F Preferred Stock as provided in Article 6 hereof.
Section 6.8 No Sinking Fund. No sinking fund shall be created for the
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redemption or purchase of shares of the Series F Preferred Stock
ARTICLE 7
Voting Rights
The holders of the Series F Preferred Stock have no voting power,
except as otherwise provided by the General Corporation Law of the State of
Delaware ("DGCL"), in this Article 7, and in Article 8 below.
Notwithstanding the above, the Corporation shall provide each Holder of
Series F Preferred Stock with prior notification of any meeting of the
shareholders (and copies of proxy materials and other information sent to
shareholders). In the event of any taking by the Corporation of a record of its
shareholders for the purpose of determining shareholders who are entitled to
receive payment of any dividend or other distribution, any right to subscribe
for, purchase or otherwise acquire (including by way of merger, consolidation or
recapitalization) any share of any class or any other securities or property, or
to receive any other right, or for the purpose of determining shareholders who
are entitled to vote in connection with any proposed liquidation, dissolution or
winding up of the Corporation, the Corporation shall mail a notice to each
Holder, at least 30 days prior to the consummation of the transaction or event,
whichever is earlier), of the date on which any such action is to be taken for
the purpose of such dividend, distribution, right or other event, and a brief
statement regarding, the amount and character of such dividend, distribution,
right or other event to the extent known at such time.
To the extent that under the DGCL the vote of the Holders of the Series
F Preferred Stock, voting separately as a class or series as applicable, is
required to authorize a given action of the Corporation, the affirmative vote or
consent of the Holders of at least a majority of the outstanding shares of
Series F Preferred Stock represented at a duly held meeting at which a quorum is
present or by written consent of a majority of the outstanding shares of Series
F Preferred Stock (except as otherwise may be required under the DGCL) shall
constitute the approval of such action by the class. To the extent that under
the DGCL holders of the Series F Preferred Stock are entitled to vote on a
matter with holders of Common Stock, voting together as one class, each share of
Series F Preferred Stock shall be entitled to a number of votes equal to the
number of shares of Common Stock into which it is then convertible using the
record date for the taking of such vote of shareholders as the date as of which
the Conversion Price is calculated. Holders of the Series F Preferred Stock
shall be entitled to notice of all shareholder meetings or written consents (and
copies of proxy materials and other information sent to shareholders) with
respect to which they would be entitled to vote, which notice would be provided
pursuant to the Corporation's bylaws and the DGCL.
Except as otherwise required by applicable law, subject to receipt of
the approval of the Holders of the Series F Preferred Stock as required herein,
the Corporation may alter or change the rights, preferences or privileges of the
Series F Preferred Stock without the approval of any other class or series of
capital stock of the Corporation.
ARTICLE 8
Protective Provisions
9
So long as shares of Series F Preferred Stock are outstanding, the
Corporation shall not, without first obtaining the approval (by vote or written
consent, as provided by the DGCL) of the Holders of at least a majority of the
then outstanding shares of Series F Preferred Stock:
(a) alter or change the rights, preferences or privileges of the
Series F Preferred Stock;
(b) create any Senior Securities or alter or change the rights,
preferences or privileges of any Senior Securities so as to affect adversely the
Series F Preferred Stock;
(c) increase the authorized number of shares of Series F Preferred
Stock; or
(d) do any act or thing not authorized or contemplated by this
Certificate of Designation which would result in taxation of the holders of
shares of the Series F Preferred Stock under Section 305 of the Internal Revenue
Code of 1986, as amended (or any comparable provision of the Internal Revenue
Code as hereafter from time to time amended).
In the event Holders of least a majority of the then outstanding
shares of Series F Preferred Stock give their approval to allow the Corporation
to alter or change the rights, preferences or privileges of the shares of Series
F Preferred Stock, pursuant to subsection (a) above, so as to affect the Series
F Preferred Stock, then the Corporation will deliver notice of such approved
change to the Holders of the Series F Preferred Stock that did not approve such
alteration or change (the "Dissenting Holders") and the Dissenting Holders shall
have the right for a period of 30 days to convert pursuant to the terms of this
Certificate of Designation as they exist prior to such alteration or change or
continue to hold their shares of Series F Preferred Stock.
ARTICLE 9
Miscellaneous
Section 9.1 Loss, Theft, Destruction of Preferred Stock Certificates.
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Upon receipt of evidence satisfactory to the Corporation of the loss,
theft, destruction or mutilation of shares of Series F Preferred Stock and, in
the case of any such loss, theft or destruction, upon receipt of indemnity or
security reasonably satisfactory to the Corporation, or, in the case of any such
mutilation, upon surrender and cancellation of the Series F Preferred Stock, the
Corporation shall make, issue and deliver, in lieu of such lost, stolen,
destroyed or mutilated shares of Series F Preferred Stock, new shares of Series
F Preferred Stock of like tenor. The Series F Preferred Stock shall be held and
owned upon the express condition that the provisions of this Section 9.1 are
exclusive with respect to the replacement of mutilated, destroyed, lost or
stolen shares of Series F Preferred Stock and shall preclude any and all other
rights and remedies notwithstanding any law or statute existing or hereafter
enacted to the contrary with respect to the replacement of negotiable
instruments or other securities without the surrender thereof.
Section 9.2 Who Deemed Absolute Owner.
-------------------------
The Corporation may deem the Person in whose name the Series F
Preferred Stock shall be registered upon the registry books of the Corporation
to be, and may treat it as, the absolute owner of the Series F Preferred Stock
for the purpose of receiving payment of dividends on the Series F Preferred
Stock, for the conversion of the Series F Preferred Stock and for all other
purposes, and the Corporation shall not be affected by any notice to the
contrary. All such payments and such conversion shall be valid and effectual to
satisfy and discharge the liability upon the Series F Preferred Stock to the
extent of the sum or sums so paid or the conversion so made.
Section 9.3 Register.
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10
The Corporation shall keep at its principal office a register in which
the Corporation shall provide for the registration of the Series F Preferred
Stock. Upon any transfer of the Series F Preferred Stock in accordance with the
provisions hereof, the Corporation shall register such transfer on the Series F
Preferred Stock register.
The Corporation may deem the person in whose name the Series F
Preferred Stock shall be registered upon the registry books of the Corporation
to be, and may treat it as, the absolute owner of the Series F Preferred Stock
for the purpose of receiving payment of dividends on the Series F Preferred
Stock, for the conversion of the Series F Preferred Stock and for all other
purposes, and the Corporation shall not be affected by any notice to the
contrary. All such payments and such conversions shall be valid and effective to
satisfy and discharge the liability upon the Series F Preferred Stock to the
extent of the sum or sums so paid or the conversion or conversions so made.
Section 9.4 Withholding.
-----------
To the extent required by applicable law, the Corporation may withhold
amounts for or on account of any taxes imposed or levied by or on behalf of any
taxing authority in the United States having jurisdiction over the Corporation
from any payments made pursuant to the Series F Preferred Stock.
Section 9.5 Headings.
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The headings of the Articles and Sections of this Certificate of
Designation are inserted for convenience only and do not constitute a part of
this Certificate of Designation.
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed by its duly authorized officers
on March 21, 2001.
AMERICAN TELESOURCE INTERNATIONAL, INC.
By: /s/ H. Douglas Saathoff
-----------------------
H. Douglas Saathoff, Chief Financial
Officer,
Senior Executive Vice President and
Treasurer
By: /s/ Raymond G. Romero
---------------------
Raymond G. Romero, Vice President,
General Counsel and Corporate Secretary