EXHIBIT 3.1
CERTIFICATE OF DESIGNATION
OF
SERIES D 7.75% CONVERTIBLE PREFERRED STOCK
OF
ALLEN TELECOM INC.
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
Allen Telecom Inc., a corporation organized and existing under
the General Corporation Law of the State of Delaware (hereinafter called the
"Company"), DOES HEREBY CERTIFY:
That, pursuant to authority vested in the Board of Directors of
the Company by its Second Restated Certificate of Incorporation, and pursuant to
the provisions of Section 151 of the General Corporation Law of the State of
Delaware, the Board of Directors of the Company has adopted the following
resolution providing for the issuance of a series of preferred stock:
RESOLVED, that pursuant to the authority expressly granted to
and vested in the Board of Directors of the Company by the Second Restated
Certificate of Incorporation of the Company (the "Certificate of
Incorporation"), a series of preferred stock, without par value, of the Company
be, and it hereby is, created, and that the designation and amount thereof and
the powers, designations, preferences and relative, participating, optional and
other special rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
1. Designation and Amount. There shall be created from the
3,000,000 shares of preferred stock, without par value, of the Company
authorized to be issued pursuant to the Certificate of Incorporation, a series
of preferred stock, designated as the "Series D 7.75% Convertible Preferred
Stock" (the "Series D Preferred Stock"), and the number of shares of such series
shall be 1,150,000. Such number of shares may be decreased by resolution of the
Board of Directors; provided, however, that no such decrease shall reduce the
number of authorized shares of the Series D Preferred Stock to a number less
than the number of shares of the Series D Preferred Stock then issued and
outstanding.
2. Definitions. As used herein, in addition to those terms
otherwise defined herein, the following terms shall have the following meanings:
(a) "Accumulated Automatic Conversion Ratio Increases" shall
mean, as of any date, any accumulated automatic increases to the Conversion
Ratio that may occur pursuant to Section 6(g)(ii), as such increases may be
equitably adjusted from time to time pursuant to Section 16(d).
(b) "Board of Directors" shall mean the Board of Directors
of the Company or, with respect to any action to be taken by the Board of
Directors, any committee of the Board of Directors duly authorized to take such
action.
(c) "Business Day" shall mean any day other than a Saturday,
Sunday or other day on which commercial banks in The City of New York are
authorized or required by law or executive order to close.
(d) "Change of Control" shall mean any of the following
events:
(i) the sale, lease or transfer, in one or a series
of related transactions, of all or substantially all of the Company's assets
(determined on a consolidated basis) to any Person or group (as such term is
used in Section 13(d)(3) of the Exchange Act);
(ii) the Company consolidates with or merges into any
other Person or conveys, transfers or leases all or substantially all its assets
to any Person, or permits any Person to consolidate with or merge into, or
transfer or lease all or substantially all its properties to, the Company, and
the surviving company, successor, transferee or lessee is not organized under
the laws of the United States or any political subdivision thereof;
(iii) the adoption of a plan the consummation of which
would result in the liquidation or dissolution of the Company;
(iv) the acquisition, directly or indirectly, by any
Person or group (as such term is used in Section 13(d)(3) of the Exchange Act),
of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of
more than 50% of the aggregate voting power of the Voting Stock of the Company;
or
(v) during any period of two consecutive years,
individuals who at the beginning of such period composed the Board of Directors
of the Company (together with any new directors whose election by such Board of
Directors or whose nomination for election by the stockholders of the Company
was approved by a vote of 66 2/3% of the directors of the Company then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the Company then in
office.
(e) "Change of Control Date" shall mean the date on which a
Change of Control event described in Section 2(d) occurs.
(f) "Common Stock" shall mean the common stock, par value
$1.00 per share, of the Company, or any other class of stock resulting from
successive changes or reclassifications of such common stock consisting solely
of changes in par value, or from par value to no par value, or as a result of a
subdivision, combination, or merger, consolidation or similar transaction in
which the Company is a constituent corporation.
(g) "Conversion Price" shall mean, initially, $7.70 per
share of Common Stock, subject to adjustment from time to time as set forth in
Section 9.
(h) "Conversion Ratio" shall mean the number of shares of
Common Stock into which each share of the Series D Preferred Stock may be
converted at any time pursuant to and in accordance with an applicable voluntary
or mandatory conversion provision of this Certificate of Designation, and shall
equal (x) the Liquidation Preference divided by the
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Conversion Price applicable upon such conversion, plus (y) Accumulated Automatic
Conversion Ratio Increases, if any, through the conversion date.
(i) "Dividend Payment Date" shall mean February 15, May 15,
August 15 and November 15 of each year, commencing May 15, 2002, or, if any such
day is not a Business Day, the next succeeding Business Day.
(j) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
(k) "Holder" shall mean a holder of record of an outstanding
share or shares of the Series D Preferred Stock.
(l) "Issue Date" shall mean the original date of issuance of
shares of the Series D Preferred Stock.
(m) "Junior Stock" shall mean the Common Stock, the Series C
Junior Participating Preferred Stock and each other class of capital stock or
series of preferred stock of the Company established by the Board of Directors
after the Issue Date, the terms of which do not expressly provide that such
class or series ranks senior to or on parity with the Series D Preferred Stock
as to dividend rights or rights upon the liquidation, winding-up or dissolution
of the Company.
(n) "Liquidation Parity Stock" shall mean Parity Stock the
terms of which expressly provide that it will rank on parity with the Series D
Preferred Stock as to rights upon the liquidation, winding-up or dissolution of
the Company.
(o) "Liquidation Preference" shall mean, with respect to
each share of the Series D Preferred Stock, $50.00, subject to equitable
adjustment from time to time pursuant to Section 16(d).
(p) "Market Value" shall mean the average closing price of a
share of the Common Stock for a five consecutive Trading Day period on the NYSE
(or such other national securities exchange or automated quotation system on
which the Common Stock is then listed or authorized for quotation or, if the
Common Stock is not so listed or authorized for quotation, an amount determined
in good faith by the Board of Directors to be the fair value of the Common
Stock).
(q) "NYSE" shall mean the New York Stock Exchange, Inc.
(r) "Officer" shall mean the Chairman of the Board of
Directors, the President, any Vice President, the Treasurer, the Secretary or
any Assistant Secretary of the Company.
(s) "Officers' Certificate" shall mean a certificate signed
by two duly authorized Officers.
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(t) "Opinion of Counsel" shall mean a written opinion from
legal counsel acceptable to the Transfer Agent. The counsel may be an employee
of or counsel to the Company or the Transfer Agent.
(u) "Parity Stock" shall mean any class of capital stock or
series of preferred stock established by the Board of Directors after the Issue
Date, the terms of which expressly provide that such class or series will rank
on parity with the Series D Preferred Stock as to dividend rights or rights upon
the liquidation, winding-up or dissolution of the Company.
(v) "Person" shall mean any individual, corporation, general
partnership, limited partnership, limited liability partnership, joint venture,
association, joint-stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
(w) "Record Date" shall mean, with respect to a Dividend
Payment Date, the 15 th calendar day prior thereto, or such other date
designated by the Board of Directors with respect to a Dividend Period.
(x) "SEC" shall mean the Securities and Exchange Commission.
(y) "Securities Act" shall mean the Securities Act of 1933,
as amended, and the rules and regulations promulgated thereunder.
(z) "Senior Stock" shall mean each class of capital stock or
series of preferred stock established by the Board of Directors after the Issue
Date, the terms of which expressly provide that such class or series will rank
senior to the Series D Preferred Stock as to dividend rights or rights upon the
liquidation, winding-up or dissolution of the Company.
(aa) "Series C Junior Participating Preferred Stock" shall
mean the 500,000 shares of preferred stock of the Company designated as the
Series C Junior Participating Preferred Stock, none of which have been issued as
of the date of this Certificate of Designation.
(bb) "Trading Day" shall mean any day on which the Common
Stock is traded for any period on the NYSE (or such other national securities
exchange or automated quotation system on which the Common Stock is then listed
or authorized for quotation).
(cc) "Transfer Agent" shall mean Fifth Third Bank, the
Company's duly appointed transfer agent, registrar, redemption, conversion and
dividend disbursing agent for the Series D Preferred Stock and transfer agent
and registrar for any Common Stock issued upon conversion of or in payment of
any portion of a dividend on shares of the Series D Preferred Stock, or any
successor duly appointed by the Company.
(dd) "Underwriting Agreement" shall mean that certain
Underwriting Agreement with respect to the public offering of the Series D
Preferred Stock, dated as of March 14, 2002, among the Company, Bear, Stearns &
Co. Inc., McDonald Investments Inc., A.G. Edwards & Sons, Inc., Needham &
Company, Inc. and H.C. Wainwright & Co., Inc.
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(ee) "Voting Stock" shall mean, with respect to any Person,
securities of any class or classes of Capital Stock of such Person entitling the
holders thereof (whether at all times or only so long as no senior class of
stock has voting power by reason of contingency) to vote in the election of
members of the Board of Directors or other governing body of such Person. For
purposes of this definition, "Capital Stock" shall mean, with respect to any
Person, any and all shares, interests, participations or other equivalents
(however designated) of corporate stock or partnership interests and any and all
warrants, options and rights with respect thereto (whether or not currently
exercisable), including each class of common stock and preferred stock of such
Person.
3. Ranking. The Series D Preferred Stock will, with respect to
dividend rights and rights upon the liquidation, winding-up or dissolution of
the Company, rank (a) senior to all Junior Stock, (b) on parity with all Parity
Stock and (c) junior to all Senior Stock.
4. Liquidation Rights.
(a) In the event of any liquidation, winding-up or
dissolution of the Company, whether voluntary or involuntary, each Holder shall,
subject to the prior rights of any holders of Senior Stock, be entitled to
receive and to be paid out of the assets of the Company available for
distribution to its stockholders the Liquidation Preference for each outstanding
share of the Series D Preferred Stock held by such Holder, in preference to the
holders of, and before any payment or distribution is made on (or any setting
apart for any payment or distribution), any Junior Stock, including, without
limitation, on any Common Stock. After the payment to the Holders of the
Liquidation Preference for each outstanding share of the Series D Preferred
Stock, the Holders shall not be entitled to convert any share of the Series D
Preferred Stock into Common Stock and shall not be entitled to any further
participation in distributions of, and shall have no right or claim to, any of
the remaining assets of the Company in respect of the shares of the Series D
Preferred Stock.
(b) Upon any liquidation, winding-up or dissolution of the
Company, whether voluntary or involuntary, the Company shall not pay to the
Holders, and no Holder shall be entitled to, any additional amount per share of
the Series D Preferred Stock in excess of the Liquidation Preference to
compensate any such Holder for any Accumulated Automatic Conversion Ratio
Increases through the date of liquidation, winding-up or dissolution.
(c) Neither the sale, conveyance, exchange or transfer (for
cash, shares of stock, other securities or other consideration) of all or
substantially all the assets or business of the Company (other than in
connection with the voluntary or involuntary liquidation, winding-up or
dissolution of the Company) nor the merger or consolidation of the Company into
or with any other Person shall be deemed to be a liquidation, winding-up or
dissolution, voluntary or involuntary, for the purposes of this Section 4.
(d) In the event the assets of the Company legally available
for distribution to the Holders upon any liquidation, winding-up or dissolution
of the Company, whether voluntary or involuntary, shall be insufficient to pay
in full all amounts to which such Holders are entitled pursuant to Section 4(a),
no such distribution shall be made on account of any shares of Liquidation
Parity Stock upon such liquidation, winding-up or dissolution unless
proportionate
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distributable amounts shall be paid with equal priority on account of the Series
D Preferred Stock, ratably, in proportion to the full distributable amounts for
which Holders and holders of any Liquidation Parity Stock are entitled upon such
liquidation, winding-up or dissolution.
5. Voting; Amendments.
(a) The shares of the Series D Preferred Stock shall have no
voting rights except as set forth in Section 5(b) and 5(c) or as otherwise
required by Delaware law from time to time. In exercising the voting rights set
forth in Section 5(b) and 5(c), each Holder shall be entitled to one vote for
each share of the Series D Preferred Stock held by such Holder.
(b) So long as any shares of the Series D Preferred Stock
remain outstanding, unless a greater percentage shall then be required by law,
the Company shall not, without the affirmative vote or written consent of the
Holders (voting or consenting separately as one class) of at least 66 2/3% of
the outstanding shares of the Series D Preferred Stock, authorize, increase the
authorized amount of, reclassify any authorized capital stock or the Company
into, or issue, any shares of any class or series of Senior Stock (or any
security convertible into or exchangeable or exercisable for Senior Stock), or
adopt amendments to the Certificate of Incorporation, including this Certificate
of Designation, or the by-laws of the Company, that would materially affect the
existing terms of the Series D Preferred Stock. Notwithstanding the foregoing,
except as otherwise required by law, the Company may, without the consent of any
Holder, authorize, increase the authorized amount of, or issue shares of Parity
Stock or Junior Stock, and in taking such actions the Company shall not be
deemed to have materially adversely affected the existing terms of the Series D
Preferred Stock. In addition, the Company may, without the consent of any
Holder, enter into a Transaction, as described in Section 9(i), in which the
outstanding shares of the Series D Preferred Stock become convertible into
securities other than the Common Stock, cash or other property, or consolidate
with or merge into any other Person or convey, transfer or lease all or
substantially all its assets to any Person or permit any Person to consolidate
with or merge into, or transfer or lease all or substantially all its properties
to, the Company, as described in Section 13.
(c) So long as at least 100,000 shares of the Series D
Preferred Stock remain outstanding:
(i) If, for each of six consecutive Dividend
Periods, the Company fails to pay in cash, shares of Common Stock or a
combination of cash and shares of Common Stock, the full dividend amount payable
to the Holders with respect to such Dividend Period pursuant to Sections 6(a)
and 6(b), then the Holders, voting separately as one class, will be entitled at
the next regular or special meeting of stockholders of the Company to elect one
additional director of the Company. Effective immediately prior to the election
of such additional director, the number of directors that compose the Board of
Directors shall be increased by one director.
(ii) The Holders may exercise the voting rights set
forth in Section 5(c)(i) at any special meeting of the Holders held for such
purpose, which may be called in accordance with the Company's by-laws or as
hereinafter provided, or at any annual meeting of stockholders held for the
purpose of electing directors, and thereafter at each such annual meeting until
such time as fewer than 100,000 shares of the Series D Preferred Stock are
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outstanding, such time as the outstanding shares of the Series D Preferred Stock
have been mandatorily converted or redeemed, or the liquidation, winding-up or
dissolution of the Company, whichever is earliest, at which time such voting
rights and the term of any director elected pursuant to this Section 5(c) shall
automatically terminate.
(iii) At any time when the voting rights set forth in
Section 5(c)(i) shall have vested in the Holders, an Officer of the Company may
call, and, upon written request of the Holders of at least twenty-five percent
(25%) of the outstanding shares of the Series D Preferred Stock, addressed to
the Secretary of the Company, shall call a special meeting of the Holders. Such
meeting shall be held at the earliest practicable date upon the notice required
for annual meetings of stockholders at the place for holding annual meetings of
stockholders of the Company, or, if none, at a place designated by the Board of
Directors. Notwithstanding the provisions of this Section 5(c)(iii), no such
special meeting shall be called during a period within the 60 days immediately
preceding the date fixed for the next annual meeting of stockholders in which
such case, the election of directors pursuant to Section 5(c) shall be held at
such annual meeting of stockholders.
(iv) At any meeting held for the purpose of electing
directors at which the Holders voting separately as one class shall have the
right to elect a director as provided in this Section 5(c), the presence in
person or by proxy of the Holders of more than fifty percent (50%) of the then
outstanding shares of the Series D Preferred Stock shall be required and shall
be sufficient to constitute a quorum of such class for the election of a
director by such class. The director candidate that receives the highest number
of affirmative votes of the outstanding shares of the Series D Preferred Stock
will be elected.
(v) Any director elected pursuant to the voting
rights set forth in this Section 5(c) shall hold office until the next annual
meeting of stockholders (or his or her earlier death, resignation or removal),
unless such term has previously automatically terminated pursuant to Section
5(c)(ii)) and any vacancy in respect of any such director shall be filled only
by the Holders at a special meeting called in accordance with the procedures set
forth in this Section 5(c), or, if no such special meeting is called, at the
next annual meeting of stockholders. The Holders shall be entitled to remove any
director elected pursuant to this Section 5(c) without cause at any time and
replace such director as provided in this Section 5(c).
6. Dividends; Automatic Conversion Ratio Increases.
(a) Subject to the rights of any holders of Senior Stock or
Parity Stock, each Holder will be entitled to receive, when, as and if declared
by the Board of Directors, out of assets of the Company legally available
therefor, dividends on each share of the Series D Preferred Stock at a rate per
annum equal to 7.75% of the Liquidation Preference, or $3.875 per share annually
(or $0.96875 per share in a full quarterly dividend period), payable quarterly
in arrears on each Dividend Payment Date, to the Holders at the close of
business on the Record Date immediately preceding the relevant Dividend Payment
Date.
(b) Dividends on the outstanding shares of the Series D
Preferred Stock will be payable from the most recent Dividend Payment Date or,
in the case of the dividend payable on May 15, 2002, from the Issue Date (each
such period, a "Dividend Period"). Dividends
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payable on the Series D Preferred Stock with respect to any period other than a
full Dividend Period shall be computed on the basis of a 360-day year consisting
of twelve 30-day months. If a Dividend Payment Date is not a Business Day,
payment of dividends shall be made on the next succeeding Business Day.
(c) In the event that the Board of Directors declares a
dividend with respect to a Dividend Period in an amount less than the full
amount payable to the Holders with respect to such Dividend Period pursuant to
Sections 6(a) and 6(b) (such lesser amount, a "Partial Dividend"), such Partial
Dividend shall be distributed to the Holders on a pro rata basis with respect to
the outstanding shares of the Series D Preferred Stock.
(d) Any dividend on the Series D Preferred Stock shall be,
at the option of the Company, payable in cash, in shares of Common Stock or in a
combination of cash and shares of Common Stock. The Company may not elect to pay
any portion of the dividend with respect to any Dividend Period in shares of
Common Stock unless the covenants set forth in Sections 16(f), 16(g), 16(h) and
16(i) shall have been satisfied with respect to all of the shares of Common
Stock to be issued in payment thereof ("Dividend Common Stock"). If the Company
elects to pay any portion of a dividend in Common Stock:
(i) The Company shall furnish written notice of such
election by issuing a press release for publication on the PR Newswire or an
equivalent newswire service, if required by and in accordance with the federal
securities laws or the rules of any stock exchange on which the Series D
Preferred Stock or the Common Stock is then listed or traded, and in any case by
first class mail to each Holder or by publication (with subsequent prompt notice
by first class mail to each Holder), at least ten days in advance of the Record
Date for the relevant Dividend Payment Date.
(ii) The number of shares of Common Stock to be
issued as a dividend on the applicable Dividend Payment Date per share of the
Series D Preferred Stock will be determined by dividing (w) the difference
between the total declared dividend amount per share of the Series D Preferred
Stock to be paid with respect to the applicable Dividend Period and the amount
of the cash dividend, if any, to be paid per share of the Series D Preferred
Stock with respect to such Dividend Period, by (x) the applicable Discounted
Current Market Value of the Common Stock. The "Discounted Current Market Value"
of a share of the Common Stock with respect to a Dividend Payment Date shall
equal the product of (y) 95% and (z) the average closing price of a share of the
Common Stock on the NYSE (or such other national securities exchange or
automated quotation system on which the Common Stock is then listed or
authorized for quotation or, if the Common Stock is not so listed or authorized
for quotation, an amount determined in good faith by the Board of Directors to
be the fair value of the Common Stock) for the ten consecutive Trading Day
period ending on and including the fifth Trading Day before such Dividend
Payment Date.
(iii) No fractional shares of Common Stock shall be
issued in payment of any dividend on the Series D Preferred Stock. The Transfer
Agent is hereby authorized to aggregate any fractional shares of Common Stock
that would otherwise be distributable as Dividend Common Stock, to sell them at
the best available price and to distribute the proceeds to the Holders in
proportion to their respective interests. The Company shall reimburse the
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Transfer Agent for any expenses incurred with respect to such sale, including
brokerage commissions. If the sale by the Transfer Agent of such aggregated
fractional shares of Common Stock would be restricted, the Company shall agree
with the Transfer Agent on other appropriate arrangements for the cash
realization of such fractional shares of Common Stock. If the Company is
precluded from paying cash in lieu of fractional shares to the Holders on the
Dividend Payment Date, such failure shall not trigger an automatic increase in
the Conversion Ratio pursuant to Section 6(g)(ii), and the Company shall, when
it becomes legally and contractually able to, pay to the Holders such cash in
lieu of fractional shares.
(e) The Company will not declare, pay or set apart any sum
for the payment of any dividend or other distribution in respect of any Parity
Stock or Junior Stock, unless the Board of Directors has declared, and the
Company has not failed to pay, a dividend in the full amount payable to the
Holders pursuant to Sections 6(a) and 6(b) with respect to the Dividend Period
in which such payment of a dividend or other distribution in respect of any
Parity Stock or Junior Stock would occur. Notwithstanding anything in this
Certificate of Designation to the contrary, the Company may:
(i) declare and pay dividends on Parity Stock which
are payable solely in shares of Parity Stock or Junior Stock;
(ii) declare and pay dividends on Junior Stock which
are payable solely in shares of Junior Stock;
(iii) declare and pay dividends on Parity Stock or
Junior Stock by increasing the liquidation value of the Parity Stock or Junior
Stock, as applicable;
(iv) repurchase, redeem or otherwise acquire Junior
Stock in exchange for Junior Stock; or
(v) repurchase, redeem or otherwise acquire Parity
Stock in exchange for Parity Stock or Junior Stock.
(f) If the Board of Directors declares a dividend with
respect to a Dividend Period, the Holders at the close of business on the
applicable Record Date will be entitled to receive the dividend payment on
shares of the Series D Preferred Stock on the corresponding Dividend Payment
Date notwithstanding the conversion thereof subsequent to such Record Date,
unless the Company defaults in payment of such dividend on the corresponding
Dividend Payment Date, in which case such Holders shall be issued on the
Dividend Payment Date, in addition to the shares of Common Stock issued on the
conversion date, an additional number of shares of Common Stock per converted
share of the Series D Preferred Stock equal to the automatic increase in the
Conversion Ratio pursuant to Section 6(g)(ii). However, shares of the Series D
Preferred Stock surrendered for conversion during the period between the close
of business on any Record Date and the close of business on the Business Day
immediately preceding the applicable Dividend Payment Date must be accompanied
by payment of an amount in cash equal to the cash dividend amount payable on
that Dividend Payment Date (or, if the dividend payable on that Dividend Payment
Date is payable in Common Stock in whole or in part, an amount in cash equal to
the cash dividend amount that would have been payable on that
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Dividend Payment Date if the Company had elected to pay such dividend solely in
cash) on the shares of the Series D Preferred Stock surrendered for conversion.
A Holder on a Record Date who (or whose transferee) tenders any shares for
conversion on the corresponding Dividend Payment Date will receive any dividend
payable by the Company on such tendered shares of the Series D Preferred Stock
on that date, and the converting Holder need not include payment in the amount
of such dividend upon surrender of shares of the Series D Preferred Stock for
conversion.
(g) The difference between (x) the full amount payable per
share of the Series D Preferred Stock to the Holders with respect to any
Dividend Period pursuant to Sections 6(a) and 6(b) and (y) any lesser (or zero)
actual dividend amount paid per share of the Series D Preferred Stock with
respect to such Dividend Period, resulting from the failure of the Board of
Directors to declare any dividend with respect to such Dividend Period, the
declaration by the Board of Directors of a Partial Dividend with respect to such
Dividend Period, or the failure of the Company to pay on the applicable Dividend
Payment Date the dividend or Partial Dividend declared by the Board of Directors
for such Dividend Period, is referred to as the "Dividend Deficiency." In the
event that a Dividend Deficiency shall occur with respect to any Dividend
Period:
(i) The Holders will not be entitled to receive the
amount of the Dividend Deficiency with respect to such Dividend Period, and the
amount of the Dividend Deficiency with respect to such Dividend Period shall not
accumulate and no interest or sum of money or other property or securities in
lieu of interest will be payable in respect of such Dividend Deficiency.
(ii) The Conversion Ratio shall automatically
increase on the Dividend Payment Date on which the amount of such Dividend
Deficiency would have been paid by a number of shares of Common Stock equal to
115% of the number of shares of Common Stock that the Company would have been
required to issue as a stock dividend on each share of the Series D Preferred
Stock to pay the Dividend Deficiency with respect to the applicable Dividend
Period in full. Such automatic increase in the Conversion Ratio shall be deemed
to fully satisfy in all respects the payment of the amount of the Dividend
Deficiency with respect to the applicable Dividend Period, and, except for the
voting rights described in Section 5(c), no other rights or interest will accrue
to the Holders as a result of any Dividend Deficiency, whether or not the
earnings or net surplus of the Company in any calendar or fiscal year of the
Company were sufficient to pay any such Dividend Deficiency in whole or in part.
(iii) Upon any automatic increase in the Conversion
Ratio pursuant to Section 6(g)(ii), the Company promptly shall deliver to the
Transfer Agent an Officers' Certificate describing in reasonable detail the
Dividend Deficiency requiring the automatic increase in the Conversion Ratio and
the method of calculation thereof in accordance with the provisions of this
Certificate of Designation and specifying the increased Conversion Ratio in
effect following such automatic increase.
(iv) The Company shall furnish notice of any Dividend
Deficiency and resulting automatic increase in the Conversion Ratio pursuant to
Section 6(g)(ii) by issuing a press release for publication on the PR Newswire
or an equivalent newswire service, if required
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by and in accordance with the federal securities laws or the rules of any stock
exchange on which the Series D Preferred Stock or the Common Stock is then
listed or traded, and in any case by distribution of a copy of the Officers'
Certificate described in Section 6(g)(iii) to each Holder by first class mail or
by publication (with subsequent prompt distribution of such notice by first
class mail to each Holder), (A) at least ten days in advance of the Record Date
for the relevant Dividend Payment Date, in the event that the Board of Directors
does not declare a dividend with respect to any Dividend Period or declares a
Partial Dividend with respect to any Dividend Period, or (B) no more than three
days after the relevant Dividend Payment Date, if the Company fails to pay a
dividend or Partial Dividend declared by the Board of Directors with respect to
any Dividend Period.
(h) Automatic increases in the Conversion Ratio pursuant to
Section 6(g)(ii) will occur each time a Dividend Deficiency occurs with respect
to a Dividend Period, and such increases in the Conversion Ratio shall
accumulate with respect to each outstanding share of the Series D Preferred
Stock, until the earlier of (i) such time as such shares of the Series D
Preferred Stock are redeemed for cash or converted into Common Stock, cash or
other property as provided in this Certificate of Designation, or (ii) such time
as distributions of the Company's assets with respect to such shares of the
Series D Preferred Stock are made upon the liquidation, winding-up of
dissolution of the Company as provided in this Certificate of Designation. Upon
distribution of the Company's assets to the Holders with respect to the
outstanding shares of the Series D Preferred Stock upon the liquidation,
winding-up of dissolution of the Company as provided in Section 4 or upon the
mandatory redemption of the outstanding shares of the Series D Preferred Stock
pursuant to Section 11, the Company shall not pay to any Holder any amount per
share of the Series D Preferred Stock in excess of the Liquidation Preference to
compensate such Holder for Accumulated Automatic Conversion Ratio Increases
through the date of liquidation or the Mandatory Redemption Date.
(i) The Company shall take all actions required or permitted
under the General Corporation Law of the State of Delaware to permit the payment
of dividends on the Series D Preferred Stock and automatic increases in the
Conversion Ratio pursuant to Section 6(g)(ii).
(j) In the event that the Company consummates a transaction
described in Section 2(d)(ii), and the laws of the jurisdiction in which the
successor, transferee or lessee is organized would impose a withholding tax on
any dividend payment hereunder, the Company shall:
(i) furnish written notice to the Holders, by
issuing a press release for publication on the PR Newswire or an equivalent
newswire service, if required by and in accordance with the federal securities
laws or the rules of any stock exchange on which the Series D Preferred Stock or
the Common Stock is then listed or traded, and in any case by distribution of
such notice to each Holder by first class mail or by publication (with
subsequent prompt distribution of such notice by first class mail to each
Holder) at least ten days in advance of the Record Date for the first Dividend
Payment Date on which any dividend payable hereunder would be subject to such
withholding tax, whether or not any dividend is paid on such Dividend Payment
Date, which notice shall state that withholding taxes may be imposed with
respect to dividends payable on the Series D Preferred Stock and that the
Company will, as
11
described in Section 6(j)(ii) below, increase the dividend amounts payable on
the Series D Preferred Stock with respect to all Dividend Periods for which such
withholding taxes apply;
(ii) with respect to the dividend payable on each
Dividend Payment Date for which any such withholding tax may be imposed,
increase the dividend amount payable to the Holders such that the net dividend
amount payable to the Holders on such Dividend Payment Date after giving effect
to any such withholding tax shall be equivalent to the dividend that the Holders
would have received on such Dividend Payment Date absent such withholding tax;
and
(iii) with respect to each dividend for which any such
withholding tax may be imposed, deliver to the Transfer Agent promptly after the
declaration of such dividend an Officers' Certificate describing in detail the
dividend amount that would have been payable on the relevant Dividend Payment
Date before the increase for withholding taxes pursuant to Section 6(j)(ii) and
the amount by which such dividend amount was increased to produce a net dividend
amount equal to the dividend amount that the Holders would have received on the
relevant Dividend Payment Date absent such withholding tax.
7. Voluntary Conversion.
(a) Each Holder shall have the right, at its option,
exercisable at any time and from time to time from the Issue Date, to convert,
subject to the terms and provisions of this Section 7 and Section 11, any or all
of such Holder's shares of the Series D Preferred Stock into such whole number
of shares of Common Stock per share of the Series D Preferred Stock as is equal
to the Conversion Ratio in effect on the date of conversion, plus cash in lieu
of any fractional share of Common Stock as provided in Section 8.
(b) The conversion right of a Holder shall be exercised by
the Holder by the delivery to the Company at any time during usual business
hours at the Company's principal place of business or the offices of the
Transfer Agent of a written notice to the Company in the form of Exhibit B that
the Holder elects to convert the number of its shares of the Series D Preferred
Stock specified in such notice. The conversion of shares of the Series D
Preferred Stock not represented by physical certificates will be effected
through the facilities of the Depositary as described in Section 15. If the
shares of the Series D Preferred Stock that the Holder wishes to convert are
represented by one or more physical certificates, the Holder shall be required
to surrender such physical certificate or certificates to the Company or the
Transfer Agent (properly endorsed or assigned for transfer, if the Company shall
so require). The shares of Common Stock and cash in lieu of any fractional share
due to such Holder surrendering physical certificates shall be delivered to the
Holder and each surrendered physical certificate shall be canceled and retired.
Immediately prior to the close of business on the date of receipt by the Company
or its duly appointed Transfer Agent of notice of conversion of shares of the
Series D Preferred Stock, each converting Holder shall be deemed to be the
holder of record of Common Stock issuable upon conversion of such Holder's
shares of the Series D Preferred Stock notwithstanding that the share register
of the Company shall then be closed or that, if applicable, physical
certificates representing such Common Stock shall not then be actually delivered
to such Holder. On the date of any conversion, all rights of any Holder with
respect to the shares of the Series D Preferred Stock so converted, including
the rights, if any, to receive distributions of
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the Company's assets (including, but not limited to, the Liquidation Preference)
or notices from the Company, will terminate, except only for the rights of any
such Holder to (i) receive physical certificates (if applicable) for the number
of whole shares of Common Stock into which such shares of the Series D Preferred
Stock have been converted and cash in lieu of any fractional share as provided
in Section 8, and (ii) exercise the rights to which he, she or it is entitled as
a holder of Common Stock into which such shares of the Series D Preferred Stock
have been converted.
8. No Fractional Shares Upon Conversion. No fractional shares or
securities representing fractional shares of Common Stock shall be issued upon
any conversion of any shares of the Series D Preferred Stock, whether voluntary
or mandatory. If more than one share of the Series D Preferred Stock held by the
same Holder shall be subject to conversion at one time, the number of full
shares of Common Stock issuable upon conversion thereof shall be computed on the
basis of the aggregate Liquidation Preference of, and any applicable Accumulated
Automatic Conversion Ratio Increases with respect to, all of such shares of the
Series D Preferred Stock as of the conversion date. If the conversion of any
share or shares of the Series D Preferred Stock results in a fraction, an amount
equal to such fraction multiplied by the last reported sale price of the Common
Stock on the NYSE (or such other national securities exchange or automated
quotation system on which the Common Stock is then listed or authorized for
quotation or, if the Common Stock is not so listed or authorized for quotation,
an amount determined in good faith by the Board of Directors to be the fair
value of the Common Stock) at the close of business on the Trading Day next
preceding the conversion date shall be paid to such Holder in cash by the
Company.
9. Adjustments to Conversion Price. Any adjustment to the
Conversion Price shall result in a change in the Conversion Ratio. The
Conversion Price shall be subject to adjustment as follows:
(a) In case the Company shall at any time or from time to
time:
(i) pay a dividend (or other distribution) payable
in shares of Common Stock on any class of capital stock (which, for purposes of
this Section 9 shall include, without limitation, any dividends or distributions
in the form of options, warrants or other rights to acquire capital stock) of
the Company (other than the issuance of shares of Common Stock in connection
with the conversion of the Series D Preferred Stock or as dividends in respect
of the Series D Preferred Stock or any Parity Stock);
(ii) subdivide the outstanding shares of Common Stock
into a larger number of shares;
(iii) combine the outstanding shares of Common Stock
into a smaller number of shares;
(iv) issue any shares of its capital stock in a
reclassification of the Common Stock; or
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(v) pay a dividend or make a distribution to all
holders of shares of Common Stock (other than a dividend subject to Section
9(b)) pursuant to a stockholder rights plan, "poison pill" or similar
arrangement,
then, and in each such case, the Conversion Price in effect immediately prior to
such event shall be adjusted (and any other appropriate actions shall be taken
by the Company) so that the Holder of shares of the Series D Preferred Stock
thereafter surrendered for conversion shall be entitled to receive the number of
shares of Common Stock that such Holder would have owned or would have been
entitled to receive upon or by reason of any of the events described above, had
such share of the Series D Preferred Stock been converted into shares of Common
Stock immediately prior to the occurrence of such event. An adjustment made
pursuant to this Section 9(a) shall become effective retroactively (x) in the
case of any such dividend or distribution, to the day immediately following the
close of business on the record date for the determination of holders of Common
Stock entitled to receive such dividend or distribution or (y) in the case of
any such subdivision, combination or reclassification, to the close of business
on the day upon which such corporate action becomes effective.
(b) In case the Company shall at any time or from time to
time issue to all holders of its Common Stock rights, options or warrants
entitling the holders thereof to subscribe for or purchase shares of Common
Stock (or securities convertible into or exchangeable for shares of Common
Stock) at a price per share less than the Market Value for the period ending on
the date of issuance (treating the price per share of any security convertible
into, or exchangeable or exercisable for, Common Stock as equal to (i) the sum
of the price paid to acquire such security convertible into, or exchangeable or
exercisable for, Common Stock plus any additional consideration payable (without
regard to any anti-dilution adjustments) upon the conversion, exchange or
exercise of such security into Common Stock divided by (ii) the number of shares
of Common Stock into which such convertible, exchangeable or exercisable
security is initially convertible, exchangeable or exercisable), other than (A)
issuances of such rights, options or warrants if the Holder would be entitled to
receive such rights, options or warrants upon conversion at any time of shares
of the Series D Preferred Stock into Common Stock and (B) issuances that are
subject to certain triggering events (until such time as such triggering events
occur), then, and in each such case, the Conversion Price then in effect shall
be adjusted by dividing the Conversion Price in effect on the day immediately
prior to the record date of such issuance by a fraction (x) the numerator of
which shall be the sum of the number of shares of Common Stock outstanding on
such record date plus the number of additional shares of Common Stock issued or
to be issued upon or as a result of the issuance of such rights, options or
warrants (or the maximum number into or for which such convertible or
exchangeable securities initially may convert or exchange or for which such
options, warrants or other rights initially may be exercised) and (y) the
denominator of which shall be the sum of the number of shares of Common Stock
outstanding on such record date plus the number of shares of Common Stock which
the aggregate consideration for the total number of such additional shares of
Common Stock so issued (or into or for which such convertible or exchangeable
securities may convert or exchange or for which such options, warrants or other
rights may be exercised plus the aggregate amount of any additional
consideration initially payable upon the conversion, exchange or exercise of
such security) would purchase at the Market Value for the period ending on the
date of conversion; provided, however, that if the Company distributes rights or
warrants (other than those referred to above in this Section 9(b)) pro rata to
the holders of Common Stock,
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the Conversion Price shall not be subject to adjustment on account of any
declaration, distribution or exercise of such rights or warrants so long as (x)
such rights or warrants have not expired or been redeemed by the Company, and
(y) the Holder of any shares of the Series D Preferred Stock surrendered for
conversion shall be entitled to receive upon such conversion, in addition to the
shares of Common Stock then issuable upon such conversion (the "Conversion
Shares"), a number of rights or warrants to be determined as follows: (i) if
such conversion occurs on or prior to the date for the distribution to the
holders of rights or warrants of separate certificates evidencing such rights or
warrants (the "Distribution Date"), the same number of rights or warrants to
which a holder of a number of shares of Common Stock equal to the number of
Conversion Shares is entitled at the time of such conversion in accordance with
the terms and provisions applicable to the rights or warrants and (ii) if such
conversion occurs after the Distribution Date, the same number of rights or
warrants to which a holder of the number of shares of Common Stock into which
such shares of the Series D Preferred Stock was convertible immediately prior to
such Distribution Date would have been entitled on such Distribution Date had
such shares of the Series D Preferred Stock been converted immediately prior to
such Distribution Date in accordance with the terms and provisions applicable to
the rights and warrants.
(c) In case the Company shall at any time or from time to
time:
(i) make a pro rata distribution to all holders of
shares of its Common Stock consisting exclusively of cash (excluding any cash
portion of distributions referred to in Section 9(a)(v) above, or cash
distributed upon a merger or consolidation to which Section 9(i) below applies),
that, when combined together with (x) all other such all-cash distributions made
within the then-preceding 12 months in respect of which no adjustment has been
made and (y) any cash and the fair market value of other consideration paid or
payable in respect of any tender offer by the Company or any of its subsidiaries
for shares of Common Stock concluded within the then-preceding 12 months in
respect of which no adjustment pursuant to this Section 9 has been made, in the
aggregate exceeds 10% of the Company's market capitalization (defined as the
product of the Market Value for the period ending on the record date of such
distribution times the number of shares of Common Stock outstanding on such
record date) on the record date of such distribution;
(ii) complete a tender or exchange offer by the
Company or any of its subsidiaries for shares of Common Stock that involves an
aggregate consideration that, together with (A) any cash and other consideration
payable in a tender or exchange offer by the Company or any of its subsidiaries
for shares of Common Stock expiring within the then-preceding 12 months in
respect of which no adjustment pursuant to this Section 9 has been made and (B)
the aggregate amount of any such all-cash distributions referred to in Section
9(c)(i) to all holders of shares of Common Stock within the then-preceding 12
months in respect of which no adjustments have been made, exceeds 10% of the
Company's market capitalization (as defined in Section 9(c)(i)) on the
expiration of such tender offer; or
(iii) make a distribution to all holders of its Common
Stock consisting of evidences of indebtedness, shares of its capital stock other
than Common Stock or assets (including securities, but excluding those
dividends, rights, options, warrants and distributions referred to in Sections
9(a) or 9(b) above or this Section 9(c)),
15
then, and in each such case, the Conversion Price then in effect shall be
adjusted by dividing the Conversion Price in effect immediately prior to the
date of such distribution or completion of such tender or exchange offer, as the
case may be, by a fraction (x) the numerator of which shall be the Market Value
for the period ending on the record date for the determination of stockholders
entitled to receive such distribution, or, if such adjustment is made upon the
completion of a tender or exchange offer, on the payment date for such offer,
and (y) the denominator of which shall be such Market Value less the then fair
market value (as determined by the Board of Directors of the Company) of the
portion of the cash, evidences of indebtedness, securities or other assets so
distributed or paid in such tender or exchange offer, applicable to one share of
Common Stock (but such denominator shall not be less than one); provided,
however, that no adjustment shall be made with respect to any distribution of
rights to purchase securities of the Company if the Holder would otherwise be
entitled to receive such rights upon conversion at any time of shares of the
Series D Preferred Stock into shares of Common Stock unless such rights are
subsequently redeemed by the Company, in which case such redemption shall be
treated for purposes of this Section 9(b) as a dividend on the Common Stock.
Such adjustment shall be made whenever any such distribution is made or tender
or exchange offer is completed, as the case may be, and shall become effective
retroactively to a date immediately following the close of business on the
record date for the determination of stockholders entitled to receive such
distribution.
(d) In the case the Company at any time or from time to time
shall take any action affecting its Common Stock (it being understood that the
issuance or sale of shares of Common Stock (or securities convertible into or
exchangeable for shares of Common Stock, or any options, warrants or other
rights to acquire shares of Common Stock) to any Person at a price per share
less than the Conversion Price then in effect shall not be deemed such an
action), other than an action described in any of Sections 9(a), 9(b), 9(c) or
9(i), then the Conversion Price shall be adjusted in such manner and at such
time as the Board of Directors of the Company in good faith determines to be
equitable in the circumstances (such determination to be evidenced in a
resolution, a certified copy of which shall be mailed to the Transfer Agent and
the Holders along with the Officers' Certificate described in Section 9(h)).
(e) Notwithstanding anything herein to the contrary, no
adjustment under this Section 9 need be made to the Conversion Price unless such
adjustment would require an increase or decrease of at least 1% of the
Conversion Price then in effect. Any lesser adjustment shall be carried forward
and shall be made at the time of and together with the next subsequent
adjustment, if any, which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at least 1% of such
Conversion Price.
(f) The Company reserves the right to make such reductions
in the Conversion Price in addition to those required in the foregoing
provisions as it considers advisable in order that any event treated for federal
income tax purposes as a dividend of stock or stock rights will not be taxable
to the recipients. In the event the Company elects to make such a reduction in
the Conversion Price, the Company will comply with the requirements of Rule
14e-1 under the Exchange Act, and any other securities laws and regulations
thereunder if and to the extent that such laws and regulations are applicable in
connection with the reduction of the Conversion Price.
16
(g) If the Company shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a dividend or other
distribution, and shall thereafter (and before the dividend or distribution has
been paid or delivered to stockholders) legally abandon its plan to pay or
deliver such dividend or distribution, then thereafter no adjustment in the
Conversion Price then in effect shall be required by reason of the taking of
such record.
(h) Upon any increase or decrease in the Conversion Price
pursuant to this Section 9, the Company promptly shall deliver to the Transfer
Agent and each Holder an Officers' Certificate describing in reasonable detail
the event requiring the increase or decrease in the Conversion Price and the
method of calculation thereof and specifying the increased or decreased
Conversion Price and Conversion Ratio in effect following such adjustment, and
attaching and certifying the resolution of the Board of Directors pursuant to
Section 9(d) (if applicable).
(i) Subject to the provisions of Section 12, in the event of
any reclassification of outstanding shares of Common Stock (other than a change
in par value, or from par value to no par value, or from no par value to par
value), or in the event of any consolidation or merger of the Company with or
into another Person or any merger of another Person with or into the Company
(other than a consolidation or merger in which the Company is the resulting or
surviving Person and which does not result in any reclassification or change of
outstanding Common Stock), or in the event of any sale or other disposition to
another Person of all or substantially all of the assets of the Company
(computed on a consolidated basis) (any of the foregoing, a "Transaction"), each
share of the Series D Preferred Stock then outstanding shall, without the
consent of any Holder, become convertible at any time, at the option of the
Holder thereof, only into the kind and amount of securities (of the Company or
another issuer), cash and other property receivable upon such Transaction by a
holder of the number of shares of Common Stock into which such share of the
Series D Preferred Stock could have been converted immediately prior to such
Transaction, after giving effect to any adjustment event, including the exercise
of the Change of Control Option contemplated in Section 12. The provisions of
this Section 9(i) and any equivalent thereof in any such securities similarly
shall apply to successive Transactions. The provisions of this Section 9(i)
shall be the sole right of the Holders in connection with any Transaction and
such Holders shall have no separate vote thereon.
(j) For purposes of this Section 9, the number of shares of
Common Stock at any time outstanding shall not include shares held in treasury
of the Company. The Company shall not pay any dividend or make any distribution
on Common Stock held in treasury of the Company.
10. Mandatory Conversion.
(a) At any time on or after February 20, 2005, the Company
shall have the right, at its option, to cause all, but not a portion, of the
outstanding shares of the Series D Preferred Stock to be automatically converted
into that number of whole shares of Common Stock for each share of the Series D
Preferred Stock equal to the Conversion Ratio then in effect, with any resulting
fractional shares of Common Stock to be settled in accordance with Section 8.
The Company may exercise its right to cause a mandatory conversion pursuant to
this Section 10(a) only if the closing price of a share of the Common Stock as
reported on the NYSE (or such
17
other national securities exchange or automated quotation system on which the
Common Stock is then listed or authorized for quotation or, if the Common Stock
is not so listed or authorized for quotation, an amount determined in good faith
by the Board of Directors to be the fair value of the Common Stock) equals or
exceeds 125% of the Conversion Price then in effect for at least 20 Trading Days
in any consecutive 30-day trading period, including the last Trading Day of such
30-day period, ending on the Trading Day prior to the Company's issuance of a
press release, or, if no press release is issued, mailing of a notice announcing
the mandatory conversion as described in Section 10(b).
(b) To exercise the mandatory conversion right described in
Section 10(a) or in Section 10(e), the Company shall issue a press release for
publication on the PR Newswire or an equivalent newswire service, if required by
and in accordance with the federal securities laws or the rules of any stock
exchange on which the Series D Preferred Stock or the Common Stock is then
listed or traded, prior to the opening of business on the first Trading Day
following any date on which the conditions described in Section 10(a) or in
Section 10(e), as applicable, are met, announcing such a mandatory conversion.
Whether or not a press release is issued, the Company shall furnish notice of
the Company's intention to mandatorily convert the outstanding shares of the
Series D Preferred Stock by first class mail to each Holder or by publication
(with subsequent prompt notice by first class mail to each Holder), not later
than the 15 th day prior to the date on which the mandatory conversion would
occur (the "Mandatory Conversion Date"). The Mandatory Conversion Date will be a
date selected by the Company and will be at least 15 days but no more than 30
days after the Company issues the press release described in this Section 10(b),
or if no press release is issued, after mailing of the notice described in this
Section 10(b) to the Holders.
(c) In addition to any information required by applicable
law or regulation, the press release and notice of a mandatory conversion
described in Section 10(a) shall state, as appropriate: (i) the Mandatory
Conversion Date; (ii) the number of shares of Common Stock to be issued upon
conversion of each share of the Series D Preferred Stock; (iii) the number of
shares of the Series D Preferred Stock to be converted; and (iv) that dividends
on the shares of the Series D Preferred Stock to be converted will cease to be
payable on the Mandatory Conversion Date.
(d) On the Mandatory Conversion Date, dividends will cease
to be payable on the Series D Preferred Stock, and all rights of any Holder with
respect to the shares of the Series D Preferred Stock, including the rights, if
any, to receive distributions of the Company's assets (including, but not
limited to, the Liquidation Preference) or notices from the Company, will
terminate, except only for the rights of any such Holder to (i) receive physical
certificates (if applicable) for the number of whole shares of Common Stock into
which such Holder's shares of the Series D Preferred Stock have been converted
and cash in lieu of any fractional share as provided in Section 8, and (ii)
exercise the rights to which he, she or it is entitled as a holder of Common
Stock into which such Holder's shares of the Series D Preferred Stock have been
mandatorily converted. Any dividend payment declared by the Board of Directors
with respect to the shares of the Series D Preferred Stock called for a
mandatory conversion on a date during the period between the close of business
on any Record Date to the close of business on the corresponding Dividend
Payment Date will be payable on such Dividend Payment Date to the
18
Holder of such share on such Record Date if such share has been converted after
such Record Date and prior to such Dividend Payment Date.
(e) In addition to the mandatory conversion right described
in Section 10(a), if there are less than 100,000 shares of the Series D
Preferred Stock outstanding, the Company shall have the right, at any time on or
after February 20, 2006, at its option, to cause each outstanding share of the
Series D Preferred Stock to be automatically converted into that number of whole
shares of Common Stock equal to the lesser of (i) the Conversion Ratio then in
effect and (ii) the sum of (x) the Liquidation Preference divided by the Market
Value for the period ending on the second Trading Day immediately prior to the
Mandatory Conversion Date and (y) any Accumulated Automatic Conversion Ratio
Increases to the Mandatory Conversion Date. Any fractional shares of Common
Stock resulting from such conversion shall be settled in cash in accordance with
Section 8.
(f) The provisions of Sections 10(b) and 10(d) shall apply
to any mandatory conversion pursuant to Section 10(e). In addition to any
information required by applicable law or regulation, the press release and
notice of a mandatory conversion described in Section 10(e) shall state, as
appropriate: (i) the Mandatory Conversion Date; (ii) the number of shares of the
Series D Preferred Stock to be converted; (iii) that dividends on the shares of
the Series D Preferred Stock to be converted will cease to be payable on the
Mandatory Conversion Date; (iv) the Conversion Ratio then in effect; and (v)
that the number of shares of Common Stock to be issued upon conversion of each
share of the Series D Preferred Stock shall be equal to the lesser of the
Conversion Ratio then in effect and the sum of (x) the Liquidation Preference
divided by the Market Value for the period ending on the second Trading Day
immediately prior to the Mandatory Conversion Date and (y) any Accumulated
Automatic Conversion Ratio Increases to the Mandatory Conversion Date.
11. Mandatory Redemption.
(a) On but not before February 15, 2014 (the "Mandatory
Redemption Date"), the Company shall be required to redeem, subject to the legal
availability of funds therefor, all outstanding shares of the Series D Preferred
Stock at a price in cash equal to the Liquidation Preference thereof (the
"Mandatory Redemption Price"). The Company shall take all actions required or
permitted under the laws of the State of Delaware to permit such mandatory
redemption.
(b) Upon mandatory redemption pursuant to this Section 11,
the Company shall not pay to the Holders, and no Holder shall be entitled to,
any additional amount per share of the Series D Preferred Stock in excess of the
Liquidation Preference to compensate any such Holder for any Accumulated
Automatic Conversion Ratio Increases through the Mandatory Redemption Date.
(c) Unless the Company defaults in the payment of the
Mandatory Redemption Price, the right of the Holders pursuant to Section 7 to
convert shares of the Series D Preferred Stock into Common Stock shall terminate
at the close of business on the Business Day preceding the Mandatory Redemption
Date, dividends on the Series D Preferred Stock will cease to be payable on and
after the Mandatory Redemption Date and all other rights of the Holders
19
will terminate on the Mandatory Redemption Date except for the right to receive
the Mandatory Redemption Price, without interest.
(d) The Company will furnish written notice of the mandatory
redemption by issuing a press release for publication on the PR Newswire or an
equivalent newswire service, if required by and in accordance with the federal
securities laws or the rules of any stock exchange on which the Series D
Preferred Stock or the Common Stock is then listed or traded, and in any case by
first class mail to each Holder or by publication (with subsequent prompt notice
by first class mail to each Holder), at least 15 days in advance of the
Mandatory Redemption Date (the "Mandatory Redemption Notice"). In addition to
any information required by applicable law or regulation, the press release, if
any, and Mandatory Redemption Notice shall state, as appropriate:
(i) the Mandatory Redemption Date;
(ii) the total number of shares of the Series D
Preferred Stock to be mandatorily redeemed;
(iii) that each outstanding share of the Series D
Preferred Stock will be redeemed for cash in an amount equal to the Mandatory
Redemption Price;
(iv) that dividends on the Series D Preferred Stock
to be mandatorily redeemed will cease to be payable on the Mandatory Redemption
Date, unless the Company defaults in the payment of the Mandatory Redemption
Price;
(v) that the right of the Holders to voluntarily
convert shares of the Series D Preferred Stock into Common Stock will terminate
at the close of business on the Business Day preceding the Mandatory Redemption
Date, unless the Company defaults in the payment of the Mandatory Redemption
Price;
(vi) the Conversion Ratio then in effect; and
(vii) that if any shares of the Series D Preferred
Stock held by any Holder are represented by one or more physical certificates,
such Holder must surrender to the Company or the Transfer Agent, in the manner
and at the place or places designated, such physical certificate or certificates
representing the shares of the Series D Preferred Stock to be redeemed.
(e) The mandatory redemption of shares of the Series D
Preferred Stock not represented by physical certificates will be effected
through the facilities of the Depositary as described in Section 15. Each Holder
of one or more physical certificates representing shares of the Series D
Preferred Stock shall surrender such physical certificate or certificates to the
Company or the Transfer Agent (properly endorsed or assigned for transfer, if
the Company shall so require and the Mandatory Redemption Notice shall so
state), in the manner and at the place or places designated in the Mandatory
Redemption Notice, and the full Mandatory Redemption Price for such shares shall
be payable in cash on the Mandatory Redemption Date to the Holder, and each
surrendered physical certificate shall be canceled and retired.
20
(f) The Company shall comply with any federal and state
securities laws and regulations, to the extent such laws and regulations are
applicable, in connection with the mandatory redemption.
12. Change of Control.
(a) Upon the occurrence of a Change of Control (or if the
Company has mailed or is required by Section 12(d) to have mailed a notice with
respect to a transaction described in Section 2(d)(ii) that is for the purpose
of changing the Company's domicile to a location outside of the United States (a
"Foreign Domicile Change of Control")), each Holder shall, in the event that the
Change of Control Ratio (as defined below) is greater than the Conversion Ratio
on the Change of Control Date (or, in the case of a Foreign Domicile Change of
Control, on the date that is two Trading Days before the mailing of the notice
described in Section 12(d)), have a one-time option (the "Change of Control
Option") to convert all of such Holder's outstanding shares of the Series D
Preferred Stock into shares of Common Stock, each such share of the Series D
Preferred Stock being convertible into a number of shares of Common Stock equal
to the sum of (u) the Liquidation Preference divided by an adjusted Conversion
Price equal to the greater of (i) the Market Value for the period ending on the
Change of Control Date (or, in the case of a Foreign Domicile Change of Control,
the Market Value for the period ending on the date that is two Trading Days
before the mailing of the notice described in Section 12(d)) and (ii) $4.6667
and (v) the amount of any Accumulated Automatic Conversion Ratio Increases
through the Change of Control Date (or, in the case of a Foreign Domicile Change
of Control, the amount of any Accumulated Automatic Conversion Ratio Increases
through the Holder's date of conversion pursuant to its exercise of the Change
of Control Option). The "Change of Control Ratio" shall equal the sum of (w) the
Liquidation Preference divided by the Market Value for the period ending on the
Change of Control Date (or, in the case of a Foreign Domicile Change of Control,
the Market Value for the period ending on the date that is two Trading Days
before the mailing of the notice described in Section 12(d)) and (x) the amount
of any Accumulated Automatic Conversion Ratio Increases through the Change of
Control Date (or, in the case of a Foreign Domicile Change of Control, through
the date that is two Trading Days before the mailing of the notice described in
Section 12(d)). In lieu of converting shares of the Series D Preferred Stock
into Common Stock upon any Holder's valid exercise of the Change of Control
Option, the Company may, at its option, redeem each share of the Series D
Preferred Stock for cash equal to the product of (y) the Market Value for the
period ending on the Change of Control Date (or, in the case of a Foreign
Domicile Change of Control, for the period ending on the date that is two
Trading Days before the mailing of the notice described in Section 12(d)) and
(z) the number of shares of Common Stock that would have been issuable to such
Holder upon conversion in accordance with the first sentence of this Section
12(a). Notwithstanding the foregoing, upon the occurrence of a Change of Control
in which each holder of the Common Stock receives consideration consisting
solely of common stock of the successor, acquiror or other third party (and cash
paid in lieu of fractional shares) that is listed on a national securities
exchange or quoted on the Nasdaq National Market and all of the Common Stock has
been exchanged for, converted into or acquired for common stock of the
successor, acquiror or other third party (and cash paid in lieu of fractional
shares), and shares of the Series D Preferred Stock become convertible solely
into such common stock, the Conversion Price will not be adjusted as described
in this Section 12(a).
21
(b) The Change of Control Option must be exercised, if at
all, during the period of not less than 30 days nor more than 60 days commencing
on the third Business Day after notice of a Change in Control has been given by
the Company in accordance with Section 12(c); provided, however, that in the
case of a Foreign Domicile Change of Control, the Change of Control Option must
be exercised, if at all, during the 15 consecutive day period ending on the day
immediately prior to the Change of Control Date commencing upon the Company's
delivery of a notice to the Holders in accordance with Section 12(d).
(c) In the event of a Change of Control (other than a Change
of Control described in the last sentence of Section 12(a) or a Foreign Domicile
Change of Control), notice of such Change of Control shall be given, within five
Business Days of the Change of Control Date, by the Company by first class mail
to each Holder. Each such notice shall state (i) that a Change of Control has
occurred; (ii) the last day on which the Change of Control Option may be
exercised (with respect to any such Change of Control, the "Expiration Date")
pursuant to the terms of this Section 12; and (iii) the procedures that Holders
must follow to exercise the Change of Control Option.
(d) In the event of a Foreign Domicile Change of Control,
notice of such Foreign Domicile Change of Control shall be given at least 15
days prior to the Change of Control Date by the Company by first class mail to
each Holder. Each such notice shall state (i) that a Foreign Domicile Change of
Control is pending; (ii) the expected Change of Control Date; (iii) the last day
on which the Change of Control Option may be exercised (with respect to such
Foreign Domicile Change of Control, the "Expiration Date") pursuant to the terms
of this Section 12; and (iv) the procedures that Holders must follow to exercise
the Change of Control Option.
(e) On or before the Expiration Date, each Holder wishing to
exercise the Change of Control Option shall furnish to the Company or the
Transfer Agent the documentation requested in the notice described in Section
12(c) or 12(d), in the manner and at the place or places designated in such
notice. The conversion or redemption of shares of the Series D Preferred Stock
not represented by physical certificates will be effected through the facilities
of the Depositary as described in Section 15. Each Holder of one or more
physical certificates representing shares of the Series D Preferred Stock shall
be required to surrender such physical certificate or certificates to the
Company or the Transfer Agent (properly endorsed or assigned for transfer, if
the Company shall so require and the notice shall so state). The cash or shares
of Common Stock due to such Holder, as described in Section 12(a), shall be
delivered to the Holder and each surrendered physical certificate shall be
canceled and retired.
(f) The rights of the Holders pursuant to this Section 12
are in addition to, and not in lieu of, the voluntary conversion rights of the
Holders provided for in Section 7.
13. Consolidation, Merger and Sale of Assets.
(a) The Company, without the consent of any Holder, may
consolidate with or merge into any other Person or convey, transfer or lease all
or substantially all its assets to any Person or may permit any Person to
consolidate with or merge into, or transfer or lease all or substantially all
its properties to, the Company; provided, however, that:
22
(i) subject to the provisions of Section 12, the
shares of the Series D Preferred Stock will become shares of such successor,
transferee or lessee, having in respect of such successor, transferee or lessee
the same powers, preferences and relative participating, optional or other
special rights and the qualification, limitations or restrictions thereon, that
the shares of the Series D Preferred Stock had immediately prior to such
transaction; and
(ii) the Company delivers to the Transfer Agent an
Officers' Certificate and an Opinion of Counsel stating that such transaction
complies with this Certificate of Designation.
(b) Upon any consolidation by the Company with, or merger by
the Company into, any other person or any conveyance, transfer or lease of all
or substantially all the assets of the Company as described in Section 13(a),
the successor resulting from such consolidation or into which the Company is
merged or the transferee or lessee to which such conveyance, transfer or lease
is made, will succeed to, and be substituted for, and may exercise every right
and power of, the Company under the shares of the Series D Preferred Stock, and
thereafter, except in the case of a lease, the predecessor (if still in
existence) will be released from its obligations and covenants with respect to
the shares of the Series D Preferred Stock.
14. SEC Reports. Whether or not the Company is required to file
reports with the SEC, if any shares of the Series D Preferred Stock are
outstanding, the Company shall file with the SEC all such reports and other
information as it would be required to file with the SEC pursuant to Sections
13(a) or 15(d) under the Exchange Act. The Company shall supply each Holder,
upon request, without cost to such Holder, copies of such reports or other
information.
15. Certificates.
(a) The Series D Preferred Stock certificate shall be
substantially in the form of Exhibit A, which is hereby incorporated in, and the
form and terms thereof expressly made a part of, this Certificate of
Designation. The Series D Preferred Stock certificate may have notations,
legends or endorsements required by law, stock exchange rule, agreements to
which the Company is subject, if any, or usage (provided that any such notation,
legend or endorsement is in a form acceptable to the Company).
(b) The Series D Preferred Stock shall initially be issued
only in the form of one or more fully registered global security certificates
("Global Security Certificates") with the global securities legend set forth in
Exhibit A hereto, registered in the name of Cede & Co., the nominee of The
Depository Trust Company, which will act as securities depositary (the
"Depositary") for the Series D Preferred Stock. The Global Security Certificates
will be deposited with the Depositary or its custodian. As long as the
Depositary or its nominee is the registered owner of the Global Security
Certificates, the Depositary or that nominee will be considered the sole owner
and holder of the Global Security Certificates and all of the shares of the
Series D Preferred Stock represented by those Global Security Certificates for
all purposes under the Series D Preferred Stock. Except if the Depositary has
notified the Company that it is unwilling or unable to continue as Depositary
for the Global Security Certificates, has ceased to be qualified to act or there
is a continuing default by the Company in respect of its obligations under the
Series D Preferred Stock, this Certificate of Designation, the Underwriting
Agreement
23
or any other principal agreement or instrument executed in connection with the
offering of the Series D Preferred Stock, owners of beneficial interests in
Global Security Certificates will not be entitled to have the Global Security
Certificates or shares of the Series D Preferred Stock represented by those
certificates registered in their names, will not receive or be entitled to
receive physical certificates representing shares of the Series D Preferred
Stock in exchange and will not be considered to be owners or holders of the
Global Security Certificates or any of the shares of the Series D Preferred
Stock represented by the Global Security Certificates for any purpose under the
Series D Preferred Stock. All payments on shares of the Series D Preferred Stock
represented by the Global Security Certificates and all related transfers and
deliveries of Common Stock will be made to the Depositary or its nominee as
their holder.
(c) Except with respect to shares of Series D Preferred
Stock that may be represented by physical certificates issued by the Company
from time to time, procedures for conversion or redemption of the shares of
Series D Preferred Stock in accordance with the applicable provisions of this
Certificate of Designation will be governed by arrangements among the
Depositary, its participants and Persons that may hold beneficial interests
through its participants designed to permit the settlement without the physical
movement of certificates. Payments, transfers, deliveries, exchanges and other
matters relating to beneficial interests in Global Security Certificates may be
subject to various policies and procedures adopted by the Depositary from time
to time.
(d) If the Company issues any physical certificate
representing shares of the Series D Preferred Stock from time to time and any
such Series D Preferred Stock certificate shall be mutilated, lost, stolen or
destroyed, the Company shall, at the expense of the Holder, issue, in exchange
and in substitution for and upon cancellation of the mutilated Series D
Preferred Stock certificate, or in lieu of and substitution for the Series D
Preferred Stock certificate lost, stolen or destroyed, a new Series D Preferred
Stock certificate of like tenor and representing an equivalent amount of shares
of the Series D Preferred Stock, but only upon receipt of evidence of such loss,
theft or destruction of such Series D Preferred Stock certificate and indemnity,
if requested, satisfactory to the Company and the Transfer Agent. The Company
shall not be required to issue any physical certificates representing shares of
the Series D Preferred Stock on or after any conversion date with respect to
such shares of the Series D Preferred Stock. In place of the delivery of a
replacement certificate following any such conversion date, the Transfer Agent,
upon delivery of the evidence and indemnity described above, will deliver the
shares of Common Stock pursuant to the terms of the Series D Preferred Stock
evidenced by the certificate.
16. Other Provisions.
(a) With respect to any notice to a Holder required to be
provided hereunder, such notice shall be mailed to the registered address of
such Holder, and neither failure to mail such notice, nor any defect therein or
in the mailing thereof, to any particular Holder shall affect the sufficiency of
the notice or the validity of the proceedings referred to in such notice with
respect to the other Holders or affect the legality or validity of any mandatory
redemption, mandatory conversion, distribution, rights, warrant,
reclassification, consolidation, merger, conveyance, transfer, dissolution,
liquidation, winding-up or other action, or the vote upon any action with
respect to which the Holders are entitled to vote. All notice periods referred
to herein
24
shall commence on the date of the mailing of the applicable notice. Any notice
which was mailed in the manner herein provided shall be conclusively presumed to
have been duly given whether or not the Holder receives the notice.
(b) The shares of the Series D Preferred Stock shall be
issuable, convertible and redeemable only in whole shares.
(c) Any calculation of a dollar amount or number of shares
of Common Stock pursuant to any provision of this Certificate of Designation,
including, without limitation, the calculation of Accumulated Automatic
Conversion Ratio Increases, any Market Value, Discounted Current Market Value,
adjusted Conversion Price, Conversion Ratio, Change of Control Ratio or Dividend
Deficiency, shall be calculated to the nearest ten-thousandth of a dollar or
share.
(d) The Liquidation Preference and the annual dividend rate
set forth in Section 6(a) shall be subject to adjustment whenever there shall
occur a stock split, combination, reclassification or other similar event
involving shares of the Series D Preferred Stock. In addition, Accumulated
Automatic Conversion Ratio Increases shall be subject to adjustment whenever
there shall occur a stock split, combination, reclassification or other similar
event involving the Common Stock. Such adjustments shall be made in such manner
and at such time as the Board of Directors of the Company in good faith
determines to be equitable in the circumstances, any such determination to be
evidenced in a resolution. Upon any such equitable adjustment, the Company shall
promptly deliver to the Transfer Agent and each Holder an Officers' Certificate
attaching and certifying the resolution of the Board of Directors, describing in
reasonable detail the event requiring the adjustment and the method of
calculation thereof and specifying the increased or decreased Liquidation
Preference, annual dividend rate or Accumulated Automatic Conversion Ratio
Increases, and the Conversion Ratio, in effect following such adjustment.
(e) Shares of the Series D Preferred Stock issued and
reacquired shall be retired and canceled promptly after reacquisition thereof
and, upon compliance with the applicable requirements of Delaware law, have the
status of authorized but unissued shares of preferred stock of the Company
undesignated as to series and may with any and all other authorized but unissued
shares of preferred stock of the Company be designated or redesignated and
issued or reissued, as the case may be, as part of any series of preferred stock
of the Company, except that any issuance or reissuance of shares of the Series D
Preferred Stock must be in compliance with this Certificate of Designation.
(f) The Company covenants that it shall at all times reserve
and keep available, free from preemptive rights, out of the aggregate of its
authorized but unissued shares of Common Stock, for the purpose of effecting
conversion of shares of the Series D Preferred Stock, the full number of shares
of Common Stock deliverable upon the conversion of all outstanding shares of the
Series D Preferred Stock not theretofore converted. For purposes of this Section
16(f), the number of shares of Common Stock that shall be deliverable upon the
conversion of all outstanding shares of the Series D Preferred Stock shall be
computed as if at the time of computation all such outstanding shares were held
by a single Holder. The Company shall take all action required to increase the
authorized number of shares of Common Stock if at
25
any time there shall be insufficient unissued shares of Common Stock to permit
such reservation or to permit the conversion of all outstanding shares of the
Series D Preferred Stock not theretofore converted.
(g) The Company covenants that any shares of Common Stock
issued upon conversion of or in payment of any dividend on shares of the Series
D Preferred Stock shall be validly issued, fully paid and non-assessable.
(h) Prior to the delivery of any shares of Common Stock or
other securities that the Company shall be obligated to deliver upon conversion
of shares of the Series D Preferred Stock or the delivery of any shares of
Common Stock in payment of any dividend on shares of the Series D Preferred
Stock, the Company shall comply with all federal and state laws and regulations
thereunder requiring the registration of such securities with, or any approval
of or consent to the delivery thereof by, any governmental authority. Any share
of Common Stock so delivered shall be freely transferable under the Securities
Act.
(i) The Company shall list the shares of Common Stock
required to be delivered upon conversion of shares of the Series D Preferred
Stock or in payment of any dividend on shares of the Series D Preferred Stock,
prior to such delivery, upon each national securities exchange or quotation
system, if any, upon which the outstanding Common Stock is listed at the time of
such delivery.
(j) The Company shall pay any and all documentary stamp or
similar issue or transfer taxes payable in respect of the issue or delivery of
shares of Common Stock or other securities or property upon conversion of shares
of the Series D Preferred Stock pursuant to the provisions of this Certificate
of Designation; provided, however, that the Company shall not be required to pay
any tax that may be payable in respect of any transfer involved in the issue or
delivery of shares of Common Stock or other securities or property in a name
other than that of the Holder of the shares of the Series D Preferred Stock to
be converted and no such issue or delivery shall be made unless and until the
person requesting such issue or delivery has paid to the Company the amount of
any such tax or established, to the reasonable satisfaction of the Company, that
such tax has been paid.
(k) The headings of the various sections and subsections of
this Certificate of Designation are for convenience of reference only and shall
not affect the interpretation of any of the provisions of this Certificate of
Designation.
(l) Whenever possible, each provision of this Certificate of
Designation shall be interpreted in a manner as to be effective and valid under
applicable law and public policy. If any provision set forth herein is held to
be invalid, unlawful or incapable of being enforced by reason of any rule of law
or public policy, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating or otherwise adversely affecting
the remaining provisions of this Certificate of Designation. No provision herein
set forth shall be deemed dependent upon any other provision unless so expressed
herein. If a court of competent jurisdiction should determine that a provision
of this Certificate of Designation would be valid or enforceable if a period of
time were extended or shortened or a particular percentage were
26
increased or decreased, then such court may make such change as shall be
necessary to render the provision in question effective and valid under
applicable law.
(m) The Holders as such are not entitled to any preemptive
or preferential right to purchase or subscribe to any capital stock,
obligations, warrants or other securities of the Company.
(n) Except as may otherwise be required by law, the shares
of the Series D Preferred Stock shall not have any powers, designations,
preferences and relative, participating, optional or other special rights, other
than those specifically set forth in this Certificate of Designation or the
Certificate of Incorporation.
(Signature page follows)
27
IN WITNESS WHEREOF, this Certificate of Designation is executed
on behalf of the Company by its Executive Vice President and attested by its
Secretary this 14 th day of March, 2002.
ALLEN TELECOM INC.
By:
-------------------------
Robert A. Youdelman
Executive Vice President
Attest:
- ---------------------------
Laura Meagher
Secretary
28
EXHIBIT A
FORM OF SERIES D PREFERRED STOCK
FACE OF SECURITY
[Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the Company or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.](1)
Certificate Number: [ ]
Number of Shares of Series D Preferred Stock: [ ]
CUSIP No.: 018091 20 7
Series D 7.75% Convertible Preferred Stock
of
Allen Telecom Inc.
Allen Telecom Inc., a Delaware corporation (the "Company"),
hereby certifies that [ ] (the "Holder") is the registered owner of [ ]
fully paid and non-assessable shares of preferred stock of the Company
designated as the Series D 7.75% Convertible Preferred Stock, without par value,
liquidation preference $50.00 per share (the "Series D Preferred Stock"). The
shares of the Series D Preferred Stock are transferable on the books and records
of the Transfer Agent, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer. The
powers, designations, preferences and relative, participating, optional and
other special rights of the shares of the Series D Preferred Stock represented
hereby are issued and shall in all respects be subject to the provisions of the
Certificate of Designation of Series D 7.75% Convertible Preferred Stock of the
Company dated March 14, 2002, as the same may be amended from time to time in
accordance with its terms (the "Certificate of Designation"). Capitalized terms
used herein but not defined shall have the respective meanings given them in the
Certificate of Designation. The Company will provide a copy of the Certificate
of Designation to a Holder without charge upon written request to the Company at
its principal place of business.
Reference is hereby made to select provisions of the Series D
Preferred Stock set forth on the reverse hereof, and to the Certificate of
Designation, which select provisions and the
- ----------------
(1) Subject to removal if not a global security certificate.
Certificate of Designation shall for all purposes have the same effect as if set
forth in this certificate.
Upon receipt of this certificate, the Holder is bound by the
Certificate of Designation and is entitled to the benefits thereunder. Unless
the Transfer Agent's valid countersignature appears hereon, the shares of the
Series D Preferred Stock evidenced hereby shall not be entitled to any benefit
under the Certificate of Designation or be valid or obligatory for any purpose.
2
IN WITNESS WHEREOF, the Company has executed this Series D
Preferred Stock certificate as of the date set forth below.
ALLEN TELECOM INC.
By:
--------------------------
Name:
Title:
By:
--------------------------
Name:
Title:
Dated:
-----------------------
COUNTERSIGNED AND REGISTERED
FIFTH THIRD BANK, as Transfer Agent,
By:
-----------------------------
Authorized Signatory
Dated:
--------------------------
3
REVERSE OF SECURITY
Dividends on each share of Series D Preferred Stock shall be
payable when, as and if declared by the Board of Directors of the Company from
funds legally available therefor at a rate per annum set forth in the face
hereof or as provided in the Certificate of Designation. Dividends may be paid
in cash, in shares of the Company's common stock, par value $1.00 per share
("Common Stock"), or a combination thereof.
The shares of the Series D Preferred Stock shall be redeemable
as provided in the Certificate of Designation. The shares of the Series D
Preferred Stock shall be convertible into the Company's Common Stock in the
manner and according to the terms set forth in the Certificate of Designation.
The Company shall furnish to any holder upon request and without
charge, a statement of the powers, designations, preferences and relative,
participating, optional and other special rights of each class of the Company's
stock or series thereof and the qualifications, limitations or restrictions of
such preferences and/or rights.
4
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers the
shares of Series D Preferred Stock evidenced hereby to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
and irrevocably appoints:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer the shares of Series D Preferred Stock evidenced hereby on the
books of the Transfer Agent. The agent may substitute another to act for him or
her.
Date:
--------------------------
Signature:
---------------------
(Sign exactly as your name appears on the other side of this Series D Preferred
Stock certificate)
Signature Guarantee:(2)
----------------------------
- ----------------
(2) Signature must be guaranteed by an "eligible guarantor institution"
(i.e., a bank, stockbroker, savings and loan association or credit union)
meeting the requirements of the Transfer Agent, which requirements include
membership or participation in the Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Transfer Agent in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
EXHIBIT B
NOTICE OF CONVERSION
(To be executed by the registered holder in order to
convert shares of the Series D Preferred Stock)
The undersigned hereby irrevocably elects to convert (the
"Conversion") [_____] shares of Series D 7.75% Convertible Preferred Stock (the
"Series D Preferred Stock"), into shares of common stock, par value $1.00 per
share ("Common Stock"), of Allen Telecom Inc. (the "Company") according to the
conditions of the Certificate of Designation establishing the terms of the
Series D Preferred Stock (the "Certificate of Designation"), as of the date
written below. If shares are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto and is delivering herewith payment of all applicable taxes or evidence
that such taxes have been paid. No fee will be charged to the holder for any
conversion, except for transfer taxes, if any. A copy of each stock certificate
representing shares of the Series D Preferred Stock to be converted is attached
hereto (or evidence of loss, theft or destruction thereof).(3)
Date of Conversion: _________________________________________________________
Applicable Conversion Ratio: ________________________________________________
Number of shares of Series D Preferred Stock to be Converted: _______________
Number of shares of Common Stock to be Issued: ______________________________
Signature: __________________________________________________________________
Name: _______________________________________________________________________
Address:(4) _________________________________________________________________
Fax No.: ____________________________________________________________________
- ----------------
(3) The Company is not required to issue shares of Common Stock until the
original certificates representing the shares of the Series D Preferred Stock
(or evidence of loss, theft or destruction thereof and indemnity reasonably
satisfactory to the Company and the Transfer Agent) to be converted are received
by the Company or the Transfer Agent. The Company shall issue and deliver shares
of Common Stock by hand or by delivery to an overnight courier not later than
three business days following receipt of the original stock certificates
representing the shares of the Series D Preferred Stock to be converted.
(4) Address where shares of Common Stock and any other payments or
certificates shall be sent by the Company.