EXHIBIT 3.2
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
PRIMEDEX HEALTH SYSTEMS, INC.
-----------------------------
(UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW)
We, the undersigned, as President and Secretary, respectively, of Primedex
Health Systems, Inc., hereby certify that:
1. The name of the corporation is Primedex Health Systems, Inc. (the
"Corporation"). The name under which the Corporation was formed is CCC
Franchising Corp.
2. The date the Certificate of Incorporation was filed by the Department of
State was October 21, 1985.
3. The Corporation's Certificate of Incorporation is amended by this
Certificate of Amendment to undesignate the 5,600,000 shares of Series A
Preferred Stock and to implement certain transfer restrictions on the
Corporation's capital stock.
4. To effect the foregoing, Paragraphs (b) and (c) of Article FOURTH of the
Certificate of Incorporation relating to the Capital Stock are hereby amended to
read in their entirety as follows:
(b) The relative rights, preferences, and limitations of each class of
Capital Stock are, and the designations and relative rights, preferences, and
limitations of each series of Preferred Stock are to be fixed as follows:
(i) Subject to any limitation prescribed by law, the number of
shares in each series of Preferred Stock and the designation and
relative rights, preferences, and limitations of each series of
Preferred Stock shall be fixed by the Board of Directors of the
Corporation, provided that before any shares of a series of Preferred
Stock are issued a Certificate of Amendment of this Certificate of
Incorporation shall be filed by the Board of Directors as required by
Section 502 of the Business Corporation Law. Pursuant to the foregoing
general authority vested in it, but not in limitation thereof, the
Board of Directors is expressly empowered to determine with respect to
the shares of each series of Preferred Stock:
(1) the dividend rights of such shares, including whether
the dividends to which such shares are entitled shall be cumulative or
noncumulative and whether dividends on such shares shall have any
preference over dividends payable on any other class or classes of
stock;
(2) whether such shares shall be convertible into shares of
Common Stock or, to the extent permitted by law, into shares of
another series of Preferred Stock and, if so, upon what terms and
conditions;
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(3) whether such shares shall have voting rights in addition
to those provided by law and, if so, to what extent and upon what
terms and conditions;
(4) whether such shares shall be subject to redemption by
the Corporation and, if so, upon what terms and conditions;
(5) whether, if such shares are to be redeemable, a sinking
fund or other fund shall be established for the purpose of redemption
there and, if so, what terms and conditions;
(6) the rights of such shares in the event of the voluntary
or involuntary liquidation, dissolution, or winding up of the
Corporation, including whether such shares shall have any preferential
claim against the assets of the Corporation and, if so, to what
extent.
(ii) Except as otherwise provided by law or by action of the
Board of Directors in granting voting rights to the shares of any
series of Preferred Stock the entire voting power for the election of
directors and for all other purposes shall be vested exclusively in
the shares of Common Stock. Each share of Common Stock shall have one
vote upon all matters.
(c) Restrictions on Transfers.
Section 1 DEFINITIONS. As used in this Article FOURTH, the following
capitalized terms have the following meanings when used herein with initial
capital letters (and any references to any portions of Treasury Regulation ss.
1.382-2T shall include any successor provisions):
"5% TRANSACTION" means any Transfer described in clause (a) or (b) of
Section 2.
"AGENT" has the meaning set forth in Section 6.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CORPORATION SECURITIES" means (i) shares of Common Stock, (ii) shares of
Preferred Stock (other than preferred stock described in Section 1504(a)(4) of
the Code), (iii) warrants, rights, or options (including options within the
meaning of Treasury Regulation ss. 1.382-2T(h)(4)(v)) to purchase Securities of
the Corporation, and (iv) any Stock.
"EXCESS SECURITIES" has the meaning given such term in Section 5.
"EXPIRATION DATE" means the beginning of the taxable year of the
Corporation to which the Board of Directors determines that no Tax Benefits may
be carried forward, unless the Board of Directors shall fix an earlier date in
accordance with Section 11.
"FIVE-PERCENT STOCKHOLDER" means a Person or group of Persons that is a
"5-percent stockholder" of the Corporation pursuant to Treasury Regulation ss.
1.382-2T(g).
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"PERCENTAGE STOCK OWNERSHIP" means the percentage Stock Ownership interest
of any Person or group (as the context may require) for purposes of Section 382
of the Code as determined in accordance with Treasury Regulation ss.
1.382-2T(g), (h), (j) and (k) or any successor provision.
"PERSON" means any individual, firm, corporation or other legal entity, and
includes any successor (by merger or otherwise) of such entity.
"PRE-EXISTING 5% STOCKHOLDER" means (i) any Person that (A) has filed a
Schedule 13D or 13G with respect to the Corporation on or before August 21, 2006
or (B) on or before the thirtieth day after the effectiveness of the Certificate
of Incorporation, establishes to the satisfaction of the Board of Directors that
such Person was a direct Five-Percent Stockholder or a "first tier entity" of
the Corporation within the meaning of Treasury Regulation ss. 1.382-2T(f)(9) on
August 21, 2006 and (ii) any "5-percent owner" or "higher tier entity" of any
Person described in clause (i) within the meaning of Treasury Regulation ss.
1.382-2T(f)(10) and 1.382-2T(f)(14).
"PROHIBITED DISTRIBUTION" has the meaning given such term in Section 6.
"PROHIBITED TRANSFER" means any purported Transfer of Corporation
Securities to the extent that such Transfer is prohibited and/or void under this
Article FOURTH.
"PUBLIC GROUP" has the meaning set forth in Treasury Regulation ss.
1.382-2T(f)(13). "PURPORTED TRANSFEREE" has the meaning set forth in Section 5.
"SECURITIES" and "SECURITY" each has the meaning set forth in Section 8.
"STOCK" means any interest that would be treated as "stock" of the
Corporation pursuant to Treasury Regulation ss. 1.382-2T(f)(18).
"STOCK OWNERSHIP" means any direct or indirect ownership of Stock,
including any ownership by virtue of application of constructive ownership
rules, with such direct, indirect, and constructive ownership determined under
the provisions of Code Section 382 and the regulations thereunder.
"TAX BENEFIT" means the net operating loss carryovers, capital loss
carryovers, general business credit carryovers, alternative minimum tax credit
carryovers and foreign tax credit carryovers, as well as any loss or deduction
attributable to a "net unrealized built-in loss" within the meaning of Section
382, of the Corporation or any direct or indirect subsidiary thereof.
"TRANSFER" means any direct or indirect sale, transfer, assignment,
conveyance, pledge or other disposition or other action taken by a person, other
than the Corporation, that alters the Percentage Stock Ownership of any Person
or group. A Transfer also shall include the creation or grant of an option
(including an option within the meaning of Treasury Regulation ss.
1.382-2T(h)(4)(v)). For the avoidance of doubt, a Transfer shall not include the
creation or grant of an option by the Corporation, nor shall a Transfer include
the issuance of Stock by the Corporation.
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Section 2 RESTRICTIONS ON TRANSFERS. Any attempted Transfer of Corporation
Securities prior to the Expiration Date and any attempted Transfer of
Corporation Securities pursuant to an agreement entered into prior to the
Expiration Date, shall be prohibited and void AB INITIO (A) if the transferee is
a Five-Percent Stockholder or (b) to the extent that, as a result of such
Transfer (or any series of Transfers of which such Transfer is a part), either
(1) any Person or group of Persons would become a Five-Percent Stockholder or
(2) the Percentage Stock Ownership in the Corporation of any Five-Percent
Stockholder would be increased.
Section 3 EXCEPTIONS.
(a) Notwithstanding anything to the contrary herein, if a Transfer by
(but not to) a Pre-existing 5% Stockholder otherwise would be prohibited by
Section 2, such Transfer shall not be prohibited under Section 2 if both of the
following conditions are met: (i) such Transfer does not increase the Percentage
Stock Ownership of any Five-Percent Stockholder other than a Public Group
(including a new Public Group created under Treasury Regulation ss.
1.382-2T(j)(3)(i)), and (ii) the Stock that is the subject of the Transfer was
owned by such Pre-existing 5% Stockholder on August 21, 2006.
(b) The restrictions set forth in Section 2 shall not apply to an
attempted Transfer that is a 5% Transaction if the transferor or the transferee
obtains the prior written approval of the Board of Directors or a duly
authorized committee thereof. As a condition to granting its approval pursuant
to Section 3, the Board of Directors may, in its discretion, require (at the
expense of the transferor and/or transferee) an opinion of counsel selected by
the Board of Directors that the Transfer shall not result in the application of
any Section 382 limitation on the use of the Tax Benefits. The Board of
Directors may exercise the authority granted by this Article FOURTH through duly
authorized officers or agents of the Corporation. Nothing in this Section 3
shall be construed to limit or restrict the Board of Directors in the exercise
of its fiduciary duties under applicable law.
Section 4 LEGEND. Each certificate representing shares of Common Stock
issued by the Corporation shall conspicuously bear the following legend:
"THE CERTIFICATE OF INCORPORATION (THE "CERTIFICATE OF INCORPORATION") OF
THE CORPORATION CONTAINS RESTRICTIONS PROHIBITING THE TRANSFER (AS DEFINED
IN THE CORPORATION'S CERTIFICATE OF INCORPORATION) OF ANY STOCK OF THE
CORPORATION (INCLUDING THE CREATION OR GRANT OF CERTAIN OPTIONS) WITHOUT
THE PRIOR AUTHORIZATION OF THE BOARD OF DIRECTORS OF THE CORPORATION (THE
"BOARD OF DIRECTORS") IF SUCH TRANSFER AFFECTS THE PERCENTAGE OF STOCK OF
THE CORPORATION (WITHIN THE MEANING OF SECTION 382 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE "CODE") AND THE TREASURY REGULATIONS
PROMULGATED THEREUNDER), THAT IS TREATED AS OWNED BY A FIVE PERCENT
STOCKHOLDER UNDER THE CODE AND SUCH REGULATIONS. IF THE TRANSFER
RESTRICTIONS ARE VIOLATED, THEN THE TRANSFER WILL BE VOID AB INITIO AND THE
PURPORTED TRANSFEREE OF THE STOCK WILL BE REQUIRED TO TRANSFER EXCESS
SECURITIES (AS DEFINED IN THE CERTIFICATE OF INCORPORATION) TO THE
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CORPORATION'S AGENT. IN THE EVENT OF A TRANSFER WHICH DOES NOT INVOLVE
SECURITIES OF THE CORPORATION WITHIN THE MEANING OF NEW YORK BUSINESS
CORPORATION LAW ("SECURITIES") BUT WHICH WOULD VIOLATE THE TRANSFER
RESTRICTIONS, THE PURPORTED TRANSFEREE (OR THE RECORD OWNER) OF THE
SECURITIES WILL BE REQUIRED TO TRANSFER SUFFICIENT SECURITIES PURSUANT TO
THE TERMS PROVIDED FOR IN THE CORPORATION'S CERTIFICATE OF INCORPORATION TO
CAUSE THE FIVE PERCENT STOCKHOLDER TO NO LONGER BE IN VIOLATION OF THE
TRANSFER RESTRICTIONS. THE CORPORATION WILL FURNISH WITHOUT CHARGE TO THE
HOLDER OF RECORD OF THIS CERTIFICATE A COPY OF THE CERTIFICATE OF
INCORPORATION, CONTAINING THE ABOVE-REFERENCED TRANSFER RESTRICTIONS, UPON
WRITTEN REQUEST TO THE CORPORATION AT ITS PRINCIPAL PLACE OF BUSINESS."
Section 5 EXCESS SECURITIES.
(a) No employee or agent of the Corporation shall record any
Prohibited Transfer, and the purported transferee of such a Prohibited Transfer
(the "Purported Transferee") shall not be recognized as a stockholder of the
Corporation for any purpose whatsoever in respect of the Corporation Securities
which are the subject of the Prohibited Transfer (the "Excess Securities").
Until the Excess Securities are acquired by another person in a Transfer that is
not a Prohibited Transfer, the Purported Transferee shall not be entitled with
respect to such Excess Securities to any rights of stockholders of the
Corporation, including, without limitation, the right to vote such Excess
Securities and to receive dividends or distributions, whether liquidating or
otherwise, in respect thereof, if any. After the Excess Securities have been
acquired in a Transfer that is not a Prohibited Transfer, the Corporation
Securities shall cease to be Excess Securities. For this purpose, any Transfer
of Excess Securities not in accordance with the provisions of this Section 5 or
Section 6 shall also be a Prohibited Transfer.
(b) The Corporation may require as a condition to the registration of
the Transfer of any Corporation Securities or the payment of any distribution on
any Corporation Securities that the proposed Transferee or payee furnish to the
Corporation all information reasonably requested by the Corporation with respect
to all the direct or indirect ownership interests in such Corporation
Securities. The Corporation may make such arrangements or issue such
instructions to its stock transfer agent as may be determined by the Board of
Directors to be necessary or advisable to implement this Article FOURTH,
including, without limitation, authorizing such transfer agent to require an
affidavit from a purported transferee regarding such Person's actual and
constructive ownership of stock and other evidence that a Transfer will not be
prohibited by this Article FOURTH as a condition to registering any transfer.
Section 6 TRANSFER TO AGENT. If the Board of Directors determines that a
Transfer of Corporation Securities constitutes a Prohibited Transfer then, upon
written demand by the Corporation sent within thirty days of the date on which
the Board of Directors determines that the attempted Transfer would result in
Excess Securities, the Purported Transferee shall transfer or cause to be
transferred any certificate or other evidence of ownership of the Excess
Securities within the Purported Transferee's possession or control, together
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with any dividends or other distributions that were received by the Purported
Transferee from the Corporation with respect to the Excess Securities
("Prohibited Distributions"), to an agent designated by the Board of Directors
(the "Agent"). The Agent shall thereupon sell to a buyer or buyers, which may
include the Corporation, the Excess Securities transferred to it in one or more
arm's-length transactions (on the public securities market on which such Excess
Securities are traded, if possible, or otherwise privately); PROVIDED, HOWEVER,
that the Agent shall effect such sale or sales in an orderly fashion and shall
not be required to effect any such sale within any specific time frame if, in
the Agent's discretion, such sale or sales would disrupt the market for the
Corporation Securities or otherwise would adversely affect the value of the
Corporation Securities. If the Purported Transferee has resold the Excess
Securities before receiving the Corporation's demand to surrender Excess
Securities to the Agent, the Purported Transferee shall be deemed to have sold
the Excess Securities for the Agent, and shall be required to transfer to the
Agent any Prohibited Distributions and proceeds of such sale, except to the
extent that the Corporation grants written permission to the Purported
Transferee to retain a portion of such sales proceeds not exceeding the amount
that the Purported Transferee would have received from the Agent pursuant to
Section 7 if the Agent rather than the Purported Transferee had resold the
Excess Securities.
Section 7 APPLICATION OF PROCEEDS AND PROHIBITED DISTRIBUTIONS. The Agent
shall apply any proceeds of a sale by it of Excess Securities and, if the
Purported Transferee has previously resold the Excess Securities, any amounts
received by it from a Purported Transferee, together, in either case, with any
Prohibited Distributions, as follows: (a) first, such amounts shall be paid to
the Agent to the extent necessary to cover its costs and expenses incurred in
connection with its duties hereunder; (b) second, any remaining amounts shall be
paid to the Purported Transferee, up to the amount paid by the Purported
Transferee for the Excess Securities (or the fair market value at the time of
the Transfer, in the event the purported Transfer of the Excess Securities was,
in whole or in part, a gift, inheritance or similar Transfer) which amount shall
be determined at the discretion of the Board of Directors; and (c) third, any
remaining amounts shall be paid to one or more organizations qualifying under
Section 501(c)(3) of the Code (or any comparable successor provision) selected
by the Board of Directors. The Purported Transferee of Excess Securities shall
have no claim, cause of action or any other recourse whatsoever against any
transferor of Excess Securities. The Purported Transferee's sole right with
respect to such shares shall be limited to the amount payable to the Purported
Transferee pursuant to this Section 7. In no event shall the proceeds of any
sale of Excess Securities pursuant to this Section 7 inure to the benefit of the
Corporation.
Section 8 MODIFICATION OF REMEDIES FOR CERTAIN INDIRECT TRANSFERS. In the
event of any Transfer which does not involve a transfer of securities of the
Corporation within the meaning of New York Law ("Securities," and individually,
a "Security") but which would cause a Five-Percent Stockholder to violate a
restriction on Transfers provided for in this Article FOURTH, the application of
Section 6 and Section 7 shall be modified as described in this Section 8. In
such case, no such Five-Percent Stockholder shall be required to dispose of any
interest that is not a Security, but such Five-Percent Stockholder and/or any
Person whose ownership of Securities is attributed to such Five-Percent
Stockholder shall be deemed to have disposed of and shall be required to dispose
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of sufficient Securities (which Securities shall be disposed of in the inverse
order in which the were acquired) to cause such Five-Percent Stockholder,
following such disposition, not to be in violation of this Article FOURTH. Such
disposition shall be deemed to occur simultaneously with the Transfer giving
rise to the application of this provision, and such number of Securities that
are deemed to be disposed of shall be considered Excess Securities and shall be
disposed of through the Agent as provided in Sections 6 and 7, except that the
maximum aggregate amount payable either to such Five-Percent Stockholder or to
such other Person that was the direct holder of such Excess Securities, in
connection with such sale shall be the fair market value of such Excess
Securities at the time of the purported Transfer. All expenses incurred by the
Agent in disposing of such Excess Stock shall be paid out of any amounts due
such Five-Percent Stockholder or such other Person. The purpose of this Section
8 is to extend the restrictions in Sections 2 and 6 to situations in which there
is a 5% Transaction without a direct Transfer of Securities, and this Section 8,
along with the other provisions of this Article FOURTH, shall be interpreted to
produce the same results, with differences as the context requires, as a direct
Transfer of Corporation Securities.
Section 9 LEGAL PROCEEDINGS. If the Purported Transferee fails to surrender
the Excess Securities or the proceeds of a sale thereof to the Agent within
thirty days from the date on which the Corporation makes a written demand
pursuant to Section 6 (whether or not made within the time specified in Section
6), then the Corporation shall use its best efforts to enforce the provisions
hereof, including the institution of legal proceedings to compel the surrender.
Nothing in this Section 9 shall (a) be deemed inconsistent with any Transfer of
the Excess Securities provided in this Article FOURTH being void AB INITIO, (b)
preclude the Corporation in its discretion from immediately bringing legal
proceedings without a prior demand or (c) cause any failure of the Corporation
to act within the time periods set forth in Section 6 to constitute a waiver or
loss of any right of the Corporation under this Article FOURTH.
Section 10 DAMAGES. Any stockholder subject to the provisions of this
Article FOURTH who knowingly violates the provisions of this Article FOURTH and
any Persons controlling, controlled by or under common control with such
stockholder shall be jointly and severally liable to the Corporation for, and
shall indemnify and hold the Corporation harmless against, any and all damages
suffered as a result of such violation, including but not limited to damages
resulting from a reduction in, or elimination of, the Corporation's ability to
utilize its Tax Benefits, and attorneys' and auditors' fees incurred in
connection with such violation.
Section 11 BOARD AUTHORITY.
(a) The Board of Directors of the Corporation shall have the power to
determine all matters necessary for assessing compliance with this Article
FOURTH, including, without limitation, (i) the identification of Five-Percent
Stockholders, (ii) whether a Transfer is a 5% Transaction or a Prohibited
Transfer, (iii) the Percentage Stock Ownership in the Corporation of any
Five-Percent Stockholder, (iv) whether an instrument constitutes a Corporation
Security, (v) the amount (or fair market value) due to a Purported Transferee
pursuant to Section 7, and (vi) any other matters which the Board of Directors
determines to be relevant; and the good faith determination of the Board of
Directors on such matters shall be conclusive and binding for all the purposes
of this Article FOURTH. In addition, the Board of Directors may, to the extent
permitted by law, from time to time establish, modify, amend or rescind by-laws,
regulations and procedures of the Corporation not inconsistent with the
provisions of this Article FOURTH for purposes of determining whether any
Transfer of Corporation Securities would jeopardize the Corporation's ability to
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preserve and use the Tax Benefits and for the orderly application,
administration and implementation of this Article FOURTH. The Board of Directors
may delegate all or any portion of its duties and powers under this Article
FOURTH to a committee of the Board of Directors as it deems necessary or
advisable.
(b) Nothing contained in this Article FOURTH shall limit the authority
of the Board of Directors to take such other action to the extent permitted by
law as it deems necessary or advisable to protect the Corporation and its
stockholders in preserving the Tax Benefits. Without limiting the generality of
the foregoing, in the event of a change in law making one or more of the
following actions necessary or desirable, the Board of Directors may, by
adopting a written resolution, (i) accelerate or extend the Expiration Date,
(ii) modify the ownership interest percentage in the Corporation or the Persons
or groups covered by this Article FOURTH, (iii) modify the definitions of any
terms set forth in this Article FOURTH or (iv) modify the terms of this Article
FOURTH as appropriate to prevent an ownership change for purposes of Section 382
of the Code as a result of any changes in applicable Treasury Regulations or
otherwise; PROVIDED, HOWEVER, that the Board of Directors shall not cause there
to be such acceleration, extension, change or modification unless it concludes
in writing that such action is reasonably necessary or advisable to preserve the
Tax Benefits or that the continuation of these restrictions is no longer
reasonably necessary for the preservation of the Tax Benefits, and its
conclusion is based upon a written opinion of tax counsel to the Corporation.
Such written conclusion of the Board of Directors shall be filed with the
Secretary of the Corporation and shall be mailed by the Secretary to all
stockholders of the Corporation within 10 days after the date of such
conclusion.
Section 12 RELIANCE. The Corporation and the members of the Board of
Directors shall be fully protected in relying in good faith upon the
information, opinions, reports or statements of the chief executive officer, the
chief financial officer or the chief accounting officer of the Corporation or of
the Corporation's legal counsel, independent auditors, transfer agent,
investment bankers or other employees and agents in making the determinations
and findings contemplated by this Article FOURTH, and the members of the Board
of Directors shall not be responsible for any good faith errors made in
connection therewith. For purposes of determining the existence and identity of,
and the amount of any Corporation Securities owned by any stockholder, the
Corporation is entitled to rely conclusively on (a) the existence and absence of
filings of Schedule 13D or 13G under the Securities and Exchange Act of 1934, as
amended (or similar schedules), as of any date and (b) its actual knowledge of
the ownership of Corporation Securities.
Section 13 GENERAL AUTHORIZATION. The purpose of this Article FOURTH is to
facilitate the Corporation's ability to maintain or preserve its Tax Benefits.
If any provision of this Article FOURTH or any application of any provision
thereunder is determined to be invalid, the validity of the remaining provisions
shall be unaffected and application of such provision shall be affected only to
the extent necessary to comply with such determination.
5. The manner in which shares shall be changed by reason of this
Certificate of Amendment of Certificate of Incorporation is as follows:
There are 5,600,000 unissued shares of Series A Preferred Stock
and 4,400,000 unissued shares of undesignated Preferred Stock, par value
$.01 per share. The 5,600,000 shares of Preferred Stock designated as
Series A Preferred Stock are being undesignated and returned to authorized
and undesignated shares of Preferred Stock at the rate of one (1) for one
(1).
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6. The Certificate of Amendment of Certificate of Incorporation was
authorized by the vote of the Board of Directors followed by a vote of a
majority of all outstanding shares entitled to vote thereon at a meeting of the
shareholders held on November 15, 2006.
{Signature page follows.}
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IN WITNESS WHEREOF, Primedex Health Systems, Inc. has caused this
certificate to be signed by Howard G. Berger, M.D., its President, and by Norman
R. Hames, its Secretary, this ______ day of November, 2006.
PRIMEDEX HEALTH SYSTEMS, INC.
By
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Howard G. Berger, M.D., President
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Norman R. Hames, Secretary
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