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EXHIBIT 99.4
CERTIFICATE OF DESIGNATIONS,
RIGHTS AND PREFERENCES OF THE
SERIES B-1 NON-VOTING PARTICIPATING
PREFERRED STOCK
OF
ALTERRA HEALTHCARE CORPORATION
PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
ALTERRA HEALTHCARE CORPORATION, a corporation organized and existing under
the General Corporation Law of the State of Delaware (the "Corporation"), hereby
certifies that the following resolutions were adopted by the Board of Directors
of the Corporation as required by Section 151 of the General Corporation Law of
the State of Delaware on March 2, 2001:
RESOLVED, that pursuant to the authority granted to and vested in the Board
of Directors of the Company in accordance with the provisions of the Restated
Certificate of Incorporation, as amended, the Board of Directors hereby creates
a series of Non-Voting Participating Preferred Stock (the "Series B-1 Preferred
Stock") of the Corporation and hereby states the designation and number of
shares, and fixes the relative rights, preferences, and limitations thereof as
follows:
"SERIES B-1 NON-VOTING PARTICIPATING PREFERRED STOCK
1. Designation. The Preferred Stock of Alterra Healthcare Corporation
(the "Corporation"), created and authorized for issuance hereby shall be
designated as "Series B-1 Non-Voting Participating Preferred Stock" (hereinafter
"Series B-1 Preferred Stock") which will consist of 300,000 shares of such
Series B-1 Preferred Stock, each of which has a stated value of $75 per share as
adjusted, from time to time, in accordance with the provisions of Section 8
hereof (the "Stated Value").
2. Priority. The Series B-1 Preferred Stock shall, with respect to
dividend rights and rights on liquidation, winding up or dissolution, whether
voluntary or involuntary, whether now or hereafter issued, rank (i) junior to
the Corporation's Series A 9.75% Cumulative Convertible Pay-in-Kind Preferred
Stock (the "Series A Preferred Stock"), the Corporation's Series B Non-Voting
Participating Preferred Stock (the "Series B Preferred
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Stock"), and any other series of Preferred Stock established by the
Corporation's Board of Directors (the "Board of Directors"), the terms of which
shall specifically provide that such series shall rank senior to the Series B-1
Preferred Stock with respect to dividend rights and rights on liquidation,
winding up or dissolution (all of such series of Preferred Stock to which the
Series B-1 Preferred Stock ranks junior, are at times collectively referred to
herein as the "Senior Securities"), and (ii) senior to the Corporation's Common
Stock (the "Common Stock"), $.01 par value per share (except that with respect
to dividends the Series B-1 Preferred Stock shall rank pari passu with the
Common Stock), and the Corporation's Series A Junior Participating Preferred
Stock (the "Junior Preferred Stock") (except that with respect to dividends, the
Series B-1 Preferred Stock shall rank junior to the Junior Preferred Stock),
and, subject to clause (i) of this Section 2, any other equity securities of the
Corporation, with respect to dividend rights and rights on liquidation, winding
up or dissolution (all of such equity securities of the Corporation to which the
Series B-1 Preferred Stock ranks senior, including the Common Stock, are at
times collectively referred to herein as the "Junior Securities").
3. Dividends.
(a) Each Holder of a share of Series B-1 Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors out of
funds legally available therefor under the General Corporation Law of the State
of Delaware (the "DGCL"), dividends for each share of Series B-1 Preferred Stock
in an amount equal the amount of all cash dividends, all non cash dividends and
all other distributions (other than a dividend payable in shares of Common Stock
or a subdivision of the outstanding shares of Common Stock by reclassification
or otherwise, each of which are addressed in Section 8 hereof) declared and paid
on the Common Stock, as if the shares of Series B-1 Preferred Stock had been
converted immediately prior to the record date for payment of such dividends or
distributions at the conversion rate set forth in Section 5 hereof. Dividends on
shares of Series B-1 Preferred Stock shall be payable in cash or in such other
property, securities or assets (other than shares of Common Stock) as may be
declared and paid by the Corporation as a dividend to the holders of the
Corporation's issued and outstanding shares of Common Stock. Dividends shall be
paid to the holders of record of shares of Series B-1 Preferred Stock at the
close of business on the date specified by the Board of Directors of the
Corporation at the time such dividend is declared; provided, however, that such
record date shall not be more than 60 days nor less than 10 days prior to the
respective dividend payment date.
(b) All dividends paid with respect to shares of Series B-1 Preferred
Stock pursuant to Section 3(a) hereof shall be paid pro rata to the holders
entitled thereto.
(c) If at any time the Corporation shall have failed to pay all
dividends which have accrued on any outstanding shares of Senior Securities at
the times such dividends are payable, unless otherwise provided in the terms of
such Senior Securities, no cash or stock dividend (except in shares of Series
B-1 Preferred Stock) shall be declared by the Board of Directors or paid or set
apart for payment by the Corporation on shares of
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Series B-1 Preferred Stock unless prior to or concurrently with such
declaration, payment or setting apart for payment, all accrued and unpaid
dividends on all outstanding shares of such Senior Securities shall have been
declared, paid or set apart for payment, without interest.
4. Liquidation Preference.
(a) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Corporation, the holders of
shares of Series B-1 Preferred Stock then outstanding shall be entitled to be
paid out of the assets of the Corporation available for distribution to its
stockholders an amount in cash equal to the greater of (i) the Stated Value and
(ii) the Common Stock Liquidation Amount (as defined below) for each share of
Series B-1 Preferred Stock outstanding plus all declared but unpaid dividends
thereon to the date fixed for liquidation, before any payment shall be made or
any assets distributed to the holders of any of the Junior Securities (the
"Liquidation Preference"); provided, however, that the holders of outstanding
shares of Series B-1 Preferred Stock shall not be entitled to receive such
liquidation payment until the liquidation payments on all outstanding shares of
Senior Securities shall have been paid in full. If the assets of the Corporation
are not sufficient to pay in full the liquidation payments payable to the
holders of outstanding shares of Series B-1 Preferred Stock, then the holders of
all such shares shall share ratably in such distribution of assets in accordance
with the full respective preferential amounts that would be payable on such
shares of Series B-1 Preferred Stock if all amounts payable thereon were paid in
full.
(b) For the purposes of this Section 4, "Common Stock Liquidation
Amount" means the amount, if any, that each outstanding share of Series B-1
Preferred Stock would be entitled to receive following the payment by the
Corporation of any liquidation preferences with respect to the Senior
Securities, out of assets legally available for distribution as contemplated by
the relevant provisions of the DGCL and applicable law, assuming that the
holders of shares of Series B-1 Preferred Stock were entitled to participate
with the holders of the Series B Preferred Stock and the Common Stock in all
other assets of the Corporation (with each share of Series B-1 Preferred Stock
entitled to participate on the same basis as one hundred (100) shares of Common
Stock).
(c) For the purposes of this Section 4, (i) the voluntary sale,
conveyance, exchange or transfer (for cash, shares of stock, securities or other
consideration) of all or substantially all of the property or assets of the
Corporation (unless and until such sale, conveyance, exchange or transfer is
followed by the dissolution of the Corporation pursuant to the DGCL) or (ii) the
consolidation or merger of the Corporation with one or more other companies or
entities shall not be deemed to be a liquidation, dissolution or winding up,
voluntary or involuntary.
5. Conversion by the Corporation.
(a) The Corporation may, at its option, on or after May 31, 2003,
convert all, but not less than all, of the shares of Series B-1 Preferred Stock
then outstanding, upon notice as set forth in Section 5(d) hereof, into shares
of Common Stock with each share
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of Series B-1 Preferred Stock being converted into one hundred (100) shares of
fully paid non-assessable shares of Common Stock in accordance with and subject
to the terms of this Section 5.
(b) Notice of any conversion shall be sent by or on behalf of the
Corporation not less than 30 days prior to the date specified for such
conversion in such notice (the "Conversion Date"), by first-class mail, postage
prepaid, to all holders of record of Series B-1 Preferred Stock at their last
addresses as they shall appear on the books of the Corporation (the date such
notice is mailed by or on behalf of the Corporation is referred to herein as the
"Conversion Notice Date"); provided, however, that no failure to give such
notice or any defect therein or in the mailing thereof shall affect the validity
of the proceedings for the conversion of any shares of Series B-1 Preferred
Stock except as to the holder to whom the Corporation has failed to give notice
or except as to the holder to whom such notice was defective. In addition to any
information required by law, such notice shall state: (i) the place or places
where certificates for such shares are to be surrendered; and (ii) that
dividends on the shares to be converted will cease to be declared as of and
after the Conversion Date.
(c) If notice has been mailed in accordance with Section 5(b) hereof
and, provided that on or before the Conversion Date specified in such notice,
all shares of Common Stock necessary for such conversion shall have been set
aside by the Corporation for the pro rata benefit of the holders of the Series
B-1 Preferred Stock so called for conversion, so as to be, and to continue to be
available therefor, then, from and after the Conversion Date, dividends on the
shares of Series B-1 Preferred Stock so called for conversion shall cease to be
declared, and such shares shall no longer be deemed to be outstanding and shall
not have the status of shares of Series B-1 Preferred Stock, and all rights of
the holders thereof as stockholders of the Corporation (except the right to
receive from the Corporation shares of Common Stock in connection with the
conversion) shall cease.
(d) Upon surrender to the Corporation at the office of the transfer
agent or such other place or places, if any, as the Board of Directors may
determine and as specified in the Conversion Notice, of certificates duly
endorsed to the Corporation or in blank for shares of Series B-1 Preferred Stock
called for conversion together with appropriate evidence of the payment of any
transfer or similar tax, if required, the Corporation shall issue the number of
shares of Common Stock issuable upon conversion thereof as of the time of such
surrender and as promptly as practicable thereafter will deliver or cause to be
delivered certificates for such shares of Common Stock to the record holder of
the shares so surrendered.
(e) No fractional shares of Common Stock shall be issued pursuant to
this Section 5 and the aggregate number of shares of Common Stock issued to a
holder of Series B-1 Preferred Stock shall be rounded down to the nearest whole
number of shares.
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(f) The Corporation shall pay all documentary, stamp or similar issue
or transfer tax due upon conversion of Series B-1 Preferred Stock.
6. Redemption at the Request of the Holder.
(a) Any holder of Series B-1 Preferred Stock may, at its option, on or
after May 31, 2003, from time to time, cause the Corporation to redeem all, but
not less than all, of the Series B-1 Preferred Stock held by such holder on such
date, upon notice as set forth in Section 6(c) hereof at the redemption price
set forth in Section 6(b) hereof.
(b) The Redemption Price of each share of the Series B-1 Preferred
Stock shall be an amount in cash equal to one hundred (100) times the Common
Share Value (hereinafter defined) on the Redemption Date (as defined herein)
and, at the election of the Corporation, may be paid in cash or may be satisfied
in full by issuing to the holder one hundred (100) shares of Common Stock for
each share of Series B-1 Preferred Stock that is subject to redemption. The
Corporation shall take all actions required or permitted under the DGCL to
permit such redemption of Series B-1 Preferred Stock.
(c) Notice of any requested redemption pursuant to Section 6(a) hereof
shall be sent by or on behalf of the holder of shares of Series B-1 Preferred
Stock by first-class mail, postage prepaid, to the Corporation at its address
set forth in Section 11 hereof (the date of such mailing being referred to
herein as the Redemption Date). Such notice shall state: (i) that such
redemption is being requested pursuant the redemption provisions hereof; and
(ii) the number of shares of Series B-1 Preferred Stock to be redeemed. Upon
receipt by the Corporation of any such notice of requested redemption, the
Corporation shall become obligated to redeem as soon as practicable thereafter
all shares as to which redemption has been requested.
(d) For purposes of this Certificate of Designations, Rights and
Preferences, the following terms have the following meanings:
(i) "Closing Price" on any Trading Day with respect to the per
share price of any shares of Common Stock means the last reported sale
price regular way or, in case no such reported sale takes place on
such day, the average of the reported closing bid and asked prices
regular way, in either case on the American Stock Exchange or, if
shares of Common Stock are not listed or admitted to trading on such
exchange, on the principal national securities exchange on which such
shares are listed or admitted to trading or, if not listed or admitted
to trading on any national securities exchange, on the NASDAQ or, if
such shares are not listed or admitted to trading on any national
securities exchange or quoted on NASDAQ, the average of the closing
bid and asked prices in the over-the-counter market as furnished by
any American Stock Exchange member firm that is selected from time to
time by the Corporation for that purpose.
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(ii) "Common Share Value" means the average of the Closing Price
of the Common Stock for the five (5) consecutive Trading Days
immediately preceding the Redemption Date; provided, however, that in
the event that the Closing Price of Common Stock cannot be determined
pursuant to subsection d(i) hereof, the "Common Share Value" shall
mean the fair market value of a share of Common Stock on the
Redemption Date as agreed to by the Corporation, on the one hand, and
the holders of a majority of the shares of Series B-1 Preferred Stock
that are subject to redemption (voting or consenting in writing as a
separate class), on the other hand; and provided further, however,
that if the Corporation and such holders are unable to so agree within
10 days after the Redemption Date, then the fair market value of a
share of Common Stock shall be determined by an independent
nationally-recognized investment banking firm mutually acceptable to
the Corporation, on the one hand, and the holders of a majority of the
shares of Series B-1 Preferred Stock that are subject to redemption
(voting or consenting in writing as a separate class), on the other
hand, or if the Corporation and such holders are unable to so agree
within 5 days, by an independent nationally-recognized investment
banking firm selected by the American Arbitration Association.
(iii) "Trading Day," with respect to a securities exchange or
automated quotation system, means a day on which such exchange or
system is open for a full day of trading.
7. Voting Rights. Except as otherwise provided herein or as otherwise
required by law, holders of the Series B-1 Preferred Stock shall have no voting
rights; provided, however, that, notwithstanding the foregoing, the holders of
the Series B-1 Preferred Stock, acting by vote of a majority of the then
outstanding Series B-1 Preferred Stock, shall be entitled to approve, voting
together as a single class: (i) any amendment or modification, direct or
indirect, of the rights or preferences of the Common Stock or the Series B-1
Preferred Stock, whether by amendment of the Certificate of Incorporation,
recapitalization, merger or otherwise (including, without limitation, the
authorization or the filing of any certificate of designations with respect to
any additional class or series of capital stock of the Corporation) and (ii) any
merger, amendment of the Certificate of Incorporation, share exchange or other
corporate action (including, without limitation, any offer by the Corporation to
repurchase shares of Common Stock or any amendment to the Rights Agreement
between the Corporation and American Stock Transfer & Trust Corporation dated as
of December 10, 1998, as amended or modified from time to time) involving the
conversion or exchange of Common Stock or the receipt of cash, securities
(whether of the Corporation or any other entity), options, warrants or rights to
acquire securities or other property by holders of Common Stock (except to the
extent such transaction is subject to the provisions of Section 8 hereof) unless
the holders of Series B-1 Preferred Stock are entitled to participate in such
transaction on the same terms as the holders of Common Stock (with each share of
Series B-1 Preferred Stock entitled to participate on the same basis as one
hundred (100) shares of Common Stock). Each share of Series B-1 Preferred Stock
shall entitle the holder thereof to cast one vote on any matter submitted to a
vote of the holders of
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the Series B-1 Preferred Stock in accordance with the preceding sentence.
Notwithstanding anything to the contrary contained herein, any action required
or permitted to be taken by the holders of Series B-1 Preferred Stock at any
meeting of the holders of Series B-1 Preferred Stock may be taken without a
meeting, without prior notice and without a vote, if a consent in writing,
setting forth the action so taken, shall be signed by the holders of 100% of the
issued and outstanding shares of Series B-1 Preferred Stock.
8. Anti-Dilution Adjustments.
(a) In case the Corporation shall (i) pay or make a dividend or other
distribution on the outstanding shares of Common Stock in shares of Common
Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into
a greater number of shares, or (iii) combine or reclassify the outstanding
shares of Common Stock into a smaller number of shares, the number of issued and
outstanding shares of Series B-1 Preferred Stock (the "Outstanding Number") at
the opening of business on the day following the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution or subject to such subdivision, combination or reclassification
(the "Record Date") shall be adjusted by multiplying such Outstanding Number by
a fraction of which the numerator shall be the sum of such number of shares of
Common Stock outstanding immediately after the event described in clauses (i),
(ii) or (iii) of this Section 8(a) and of which the denominator shall be the
number of shares of Common Stock outstanding at the close of business on the
Record Date, such adjustment to the Outstanding Number to become effective
immediately after the opening of business on the Record Date. No adjustment to
the Outstanding Number need be made for a change in the par value of the Common
Stock. Whenever the Outstanding Number is adjusted, the Stated Value of each
share of Series B-1 Preferred Stock shall be adjusted proportionately such that
the aggregate Stated Value of all issued and outstanding shares of Series B-1
Preferred Stock shall not change as the result of the adjustment of the
Outstanding Number.
(b) Whenever the Outstanding Number is adjusted, the Corporation shall
promptly mail to the holders of Series B-1 Preferred Stock (i) a notice of
adjustment briefly stating the facts requiring the adjustment, the manner of
computing such adjustment and any adjustment to the Stated Value; and (ii) a
certificate or certificates representing the number of whole shares of Series
B-1 Preferred Stock to which such holder is entitled pursuant to Section 8(a)
hereof or, in the case of a reduction in the Outstanding Number, a new
certificate or certificates, in exchange for such holder's existing certificate
or certificates, representing the number of whole shares of Series B-1 Preferred
Stock to which such holder is entitled following the adjustment provided for in
Section 8(a) hereof. No fractional shares of Series B-1 Preferred Stock shall be
issued by the Corporation, so that the number of shares of Series B-1 Preferred
Stock to be issued pursuant to this Section 8 to a holder of Series B-1
Preferred Stock shall be rounded down to the nearest whole number of shares, and
the Corporation shall make a cash payment to a holder of shares of Series B-1
Preferred Stock who would otherwise have received a fractional share of Series
B-1 Preferred Stock in an amount equal to the greater of (i) the portion of the
Stated Value represented by such fraction or (ii) the portion of the Common
Stock Liquidation Amount
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represented by such fraction determined as of the Record Date of the action
necessitating the adjustment; provided, however, that, at the option of the
Corporation, the number of shares of Series B-1 Preferred Stock to be issued to
each holder of Series B-1 Preferred Stock may be rounded up to the nearest whole
number in lieu of making a cash payment with respect to any fractional amount.
(c) In case of any consolidation or merger of the Corporation with any
other entity, or in case of any sale or transfer of all or substantially all of
the assets of the Corporation, or in the case of any share exchange pursuant to
which all of the outstanding shares of Common Stock are converted into other
securities or property, the Corporation shall make appropriate provision or
cause appropriate provision to be made so that the holder of each share of
Series B-1 Preferred Stock then outstanding shall have the right thereafter to
receive, in lieu of Common Stock, in exchange for holder's shares of Series B-1
Preferred Stock, the kind and amount of shares of stock and other securities and
property receivable upon such consolidation, merger, sale, transfer or share
exchange by a holder of one hundred (100) shares of Common Stock; provided,
however, that if a purchase, tender or exchange offer shall have been made to
and accepted by the holders of more than 50% of the outstanding shares of Common
Stock, and if a holder of shares of Series B-1 Preferred Stock so designates in
a notice given to the Corporation on or before the date immediately preceding
the date of the consummation of such transaction, the holder of such Series B-1
Preferred Stock shall be entitled to receive the highest amount of securities,
cash or other property to which a holder of a number of shares of Common Stock
equal to one hundred (100) times the number of shares of Series B-1 Preferred
Stock held by such holder of Series B-1 Preferred Stock would actually have been
entitled to receive upon the consummation of such purchase, tender or exchange
offer, subject to adjustments (from and after the consummation of such purchase,
tender or exchange offer) as nearly equivalent as possible to the adjustments
provided for in this Section 8. If in connection with any such consolidation,
merger, sale, transfer or share exchange, each holder of shares of Common Stock
is entitled to elect to receive either securities, cash or other assets upon
completion of such transaction, the Corporation shall provide or cause to be
provided to each holder of Series B-1 Preferred Stock the right to elect to
receive the securities, cash or other assets a holder of a number of shares of
Common Stock equal to one hundred (100) times the number of shares of Series B-1
Preferred Stock held by such holder of Series B-1 Preferred Stock would have
been entitled to elect to receive on the same terms and subject to the same
conditions applicable to holders of the Common Stock (including, without
limitation, notice of the right to elect, the limitations on the period in which
such election shall be made and the effect of failing to exercise the election).
The Corporation shall not effect any such transaction unless the provisions of
this paragraph have been fulfilled. The above provisions shall similarly apply
to successive consolidations, mergers, sales, transfers or share exchanges.
(d) Anything herein to the contrary notwithstanding, no adjustment will
be made pursuant to Section 8 hereof by reason of the issuance of Common Stock
upon the conversion of Series A Preferred Stock or the Corporation's Series A
9.75% Convertible Pay-in-Kind Debentures due 2007 or the Corporation's Series C
9.75% Convertible Pay-in-Kind Debentures due 2007 or by reason of the issuance
of shares of Series B Preferred Stock
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upon the conversion of the Corporation's Series B 9.75% Convertible Pay-in-Kind
Debentures due 2007.
9. Shares to Be Retired. Any share of Series B-1 Preferred Stock redeemed,
repurchased or otherwise acquired by the Corporation shall be retired and
cancelled and shall upon cancellation and the filing of an appropriate
certificate with the Delaware Secretary of State be restored to the status of
authorized but unissued shares of Preferred Stock, subject to reissuance by the
Board of Directors as Series B-1 Preferred Stock or shares of preferred stock of
one or more other series.
10. Record Holders. The Corporation and the Corporation's transfer agent
may deem and treat the record holder of any shares of Series B-1 Preferred Stock
as the true and lawful owner thereof for all purposes, and neither the
Corporation nor the Corporation's transfer agent shall be affected by any notice
to the contrary.
11. Notice. Except as may otherwise be provided for herein, all notices
referred to herein shall be in writing, and all notices hereunder shall be
deemed to have been given upon, the earlier of receipt of such notice or three
Business Days after the mailing of such notice if sent by registered mail
(unless first-class mail shall be specifically permitted for such notice under
the terms of this Certificate of Designations) with postage prepaid, addressed,
if to the Corporation, to its offices at 10000 Innovation Drive, Milwaukee,
Wisconsin 53005, (Attention: Chief Financial Officer) or to an agent of the
Corporation designated as permitted by the Certificate of Incorporation or, if
to any holder of Series B-1 Preferred Stock, to such holder at the address of
such holder of Series B-1 Preferred Stock as listed in the stock record books of
the Corporation (which may include the records of the Corporation's transfer
agent); or to such other address as the Corporation or holder, as the case may
be, shall have designated by notice similarly given.
[Signature page to follow.]
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designations to be executed and acknowledged by its duly authorized officer this
2nd day of March, 2001.
ALTERRA HEALTHCARE CORPORATION
By: /s/ Mark W. Ohlendorf
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Its: Senior Vice President
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