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EXHIBIT 4.2
ASPEN TECHNOLOGY, INC.
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CERTIFICATE OF DESIGNATIONS
OF
SERIES D-1 CONVERTIBLE PREFERRED STOCK
AND
SERIES D-2 CONVERTIBLE PREFERRED STOCK
(PURSUANT TO SECTION 151 OF THE DELAWARE GENERAL CORPORATION LAW)
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Aspen Technology, Inc., a Delaware corporation (the "Corporation"), in
accordance with the provisions of Section 103 of the Delaware General
Corporation Law, does hereby certify that the following resolution was duly
adopted by the Board of Directors of the Corporation as of June 1, 2003, in
accordance with Section 141(c) of the Delaware General Corporation Law:
RESOLVED, that two series of Preferred Stock, Series D-1 Convertible
Preferred Stock, par value $0.10 per share, and Series D-2 Convertible Preferred
Stock, par value $0.10 per share, of the Corporation are hereby created and the
designation, number of shares, powers, preferences, rights, qualifications,
limitations and restrictions thereof (in addition to any provisions set forth in
the Certificate of Incorporation of the Corporation that are applicable to the
Preferred Stock of all classes and series) are as follows:
SERIES D-1 CONVERTIBLE PREFERRED STOCK
AND
SERIES D-2 CONVERTIBLE PREFERRED STOCK
A total of 302,000 shares of the authorized and unissued Preferred Stock
of the Corporation are hereby designated "Series D-1 Convertible Preferred
Stock" ("Series D-1 Preferred Stock") and a total of 65,000 shares of the
authorized and unissued Preferred Stock of the Corporation are hereby designated
"Series D-2 Convertible Preferred Stock" ("Series D-2 Preferred Stock," and
together with the Series D-1 Preferred Stock, "Series D Preferred Stock"), with
each series having the following rights, preferences, powers, privileges and
restrictions, qualifications and limitations:
1. DIVIDENDS
(a) DIVIDEND RATE. The holders of shares of Series D Preferred Stock
shall be entitled, out of funds legally available therefor, to receive
cumulative dividends at the rate per annum equal to 8% (subject to
adjustment in accordance with Section 6(a) and 6(b) below) of $333.00 per
share (subject to appropriate adjustment in the event of any stock
dividend, stock split, reverse stock split, combination, split-up,
recapitalization and like occurrences on or after the Series D Original
Issue Date (as defined below) affecting such shares, the "Stated Value"),
payable only when, as and if declared by the Board of Directors of the
Corporation. Such dividends shall be calculated on the basis of a 365-day
year, shall accumulate daily commencing on the Series D Original Issue
Date, shall compound quarterly to the extent not previously paid, and
shall accumulate from the date of issuance of a share of Series D
Preferred Stock until such share is no longer outstanding. Furthermore,
such dividends shall be deemed to accumulate from the Series D Original
Issue Date whether or not earned or declared and whether or not there are
profits, surplus or other funds of the Corporation legally available for
the payment of dividends.
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(b) DIVIDEND PAYMENTS
(i) Dividends declared on Series D Preferred Stock by the
Board of Directors of the Corporation pursuant to Subsection 1(a)
above shall be payable in cash, except that, in the sole discretion of
the Corporation (subject to Subsection 1(b)(ii) below), such dividends
may be paid in Common Stock, par value $0.10 per share, of the
Corporation ("Common Stock") as follows: Following the end of any
calendar quarter, commencing with the quarter ending March 31, 2004,
if the Board elects to pay a dividend, then the Corporation shall
deliver, by no later than the twentieth day following the end of such
calendar quarter (such twentieth day after the calendar quarter being
the "Quarterly Deadline"), a written notice to each of the holders of
Series D Preferred Stock advising such holders that the Corporation
has elected, pursuant to this paragraph (i), to pay all or any portion
of the dividends accumulated on the Series D Preferred Stock through
the final day of such calendar quarter (such final day of the calendar
quarter being the "Record Date"). If the Corporation delivers such a
notice, the Corporation shall pay such dividend on the twenty-fourth
Trading Day following the applicable Quarterly Deadline. Any such
dividend shall be payable in cash, except to the extent that the
notice delivered with respect thereto specifies that an amount (which
may be up to all) of such dividend shall be paid by the delivery of
shares of Common Stock to holders of Series D Preferred Stock as of
the Record Date (or, if such day is not a Trading Day, then the
immediately preceding Trading Day, as defined below). If the
Corporation elects to pay less than all of such accumulated dividends,
an equal amount of the dividends declared shall be paid with respect
to each share of Series D Preferred Stock and the form of payment
(that is, cash, Common Stock or a combination thereof) shall be
identical with respect to each share of Series D Preferred Stock. The
number of shares of Common Stock issuable in payment of any such
dividends to be paid in Common Stock shall be calculated as set forth
in Subsection 1(b)(iii) below, and the shares shall be delivered as
set forth in Subsection 1(b)(iv) below.
(ii) Notwithstanding any other provision hereof, the
Corporation shall not be entitled to pay a dividend in Common Stock
with respect to shares of Series D Preferred Stock pursuant to
Subsection 1(b)(i) above or Section 4(b) below unless, with respect to
such shares all of the following conditions are satisfied (with clause
(E) only being applicable to Series D-1 Preferred Stock):
(A) the Common Stock is listed on the Nasdaq National
Market, the American Stock Exchange or the New York
Stock Exchange at all times, without interruption,
between the date on which the Corporation gives
notice under Subsection 1(b)(i) through the date that
the certificate representing the shares of Common
Stock being issued in payment of such dividend is
actually delivered to the applicable holder of Series
D Preferred Stock;
(B) as of such delivery date, the Corporation has not
received any written notice or warning from such
trading or quotation facility with respect to the
potential delisting of the Common Stock, which notice
or warning continues to be unresolved or otherwise in
effect as of such delivery date such that the Common
Stock could not be listed and sold within 90 days
thereafter by reason of such notice or warning;
(C) the shares of Common Stock issued in payment of such
dividend shall be the subject of a registration
statement filed under the Securities Act of 1933, as
amended (the "Securities Act"), which registration
statement shall be effective as of the issue date, or
all such shares may be sold pursuant to Rule 144(k)
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under the Securities Act;
(D) none of the following have occurred on or prior to
such the issue date (1) the Corporation or any
significant subsidiary of the Corporation, as defined
in Rule 1-02(w) of Regulation S-X, (a "Material
Subsidiary") commences a case or other proceeding
under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any
jurisdiction relating to the Corporation or any
Material Subsidiary thereof; (2) there is commenced
against the Corporation or any Material Subsidiary
any such case or proceeding that is not dismissed
within 60 days after commencement; (3) the
Corporation or any Material Subsidiary is adjudicated
insolvent or bankrupt or any order of relief or other
order approving any such case or proceeding is
entered; (4) the Corporation or any Material
Subsidiary suffers any appointment of any custodian
or the like for it or any substantial part of its
property that is not discharged or stayed within 60
days; (5) the Corporation or any Material Subsidiary
makes a general assignment for the benefit of
creditors; (6) the Corporation or any Material
Subsidiary fails to pay, or states in writing that it
is unable to pay or is unable to pay, its debts
generally as they become due; or (7) the Corporation
or any subsidiary of the Corporation, by any act or
failure to act, expressly indicates its consent to,
approval of or acquiescence in any of the foregoing
or takes any corporate or other action that effects
any of the foregoing; and
(E) solely with respect to the holders of Series D-1
Preferred Stock, the receipt of the Common Stock by
such holders of Series D-1 Preferred Stock will be
exempt from the provisions of Section 16(b) of the
Securities Exchange Act of 1934, as amended (or any
successor thereto) (the "Exchange Act").
(iii) If a dividend on the Series D Preferred Stock is paid in
shares of Common Stock, the number of shares of Common Stock to be
issued to a holder of Series D Preferred Stock shall equal the
quotient of (A) the amount of the dividend payable to such holder
divided by (B) the arithmetic average of the Average Daily Prices for
twenty consecutive Trading Days commencing on the Trading Day
immediately following the applicable Quarterly Deadline. The
Corporation shall issue, as of such dividend payment date, a
certificate, registered in the name of the holder or its nominee, for
the number of shares of Common Stock to which the holder shall be
entitled.
(iv) If any dividend on Series D Preferred Stock is paid in
shares of Common Stock, the Corporation shall, on or before the
twenty-fourth Trading Day following the applicable Quarterly Deadline,
(A) issue and deliver to such holder a certificate, registered in the
name of such holder, for the number of shares of Common Stock to which
such holder shall be entitled or (B) if and when the applicable shares
of Common Stock may be held in a balance account with The Depository
Trust Corporation through its Deposit Withdrawal Agent Commission
System and after such holder has notified the Corporation that this
clause (B) shall apply, credit the number of shares of Common Stock to
which such holder shall be entitled to such holder's balance account
with The Depository Trust Corporation through its Deposit Withdrawal
Agent Commission System.
(v) No fractional shares of Common Stock shall be issued in
payment of dividends on the Series D Preferred Stock pursuant to this
Section 1(b). In lieu of any fractional shares to which the holder
would otherwise be entitled, the Corporation shall pay cash equal to
such
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fraction multiplied by the then-effective Series D Conversion Price.
(vi) For purposes hereof, the following definitions shall
apply:
(A) "Trading Day" shall mean (I) any day on which the
Common Stock is traded on the Nasdaq National Market,
(II) if the Common Stock is not then listed on the
Nasdaq National Market, any day on which the Common
Stock is traded on any other national securities
exchange, market, or trading or quotation facility,
or (III) if the Common Stock is not then listed or
quoted on any national securities exchange, market,
or trading or quotation facility, then a day on which
trading occurs on the New York Stock Exchange (or any
successor thereto); and
(B) "Average Daily Price" shall mean, with respect to a
Trading Day, the daily volume weighted average
trading price (the total dollar amount traded on that
day divided by trading volume for that day) of the
Common Stock on that Trading Day and for the regular
Trading Day session as reported at 4:15 P.M., Eastern
time, by Bloomberg, LP function key HP by using W to
calculate the daily weighted average, or such other
price as may be determined by an alternative
methodology agreed upon from time to time by the
Corporation and the holders of a majority of the
outstanding shares of Series D-1 Preferred Stock and
the holders of a majority of the outstanding shares
of Series D-2 Preferred Stock.
(c) PROHIBITION ON OTHER DIVIDENDS. So long as any of the shares of
Series D Preferred Stock are outstanding, the Corporation shall not
declare, pay or set aside any dividends (other than dividends payable in
shares of Common Stock, and then only at such times as the Corporation is
in compliance with its obligations hereunder) on shares of Common Stock or
Junior Stock unless dividends equal to the full amount of accumulated and
unpaid dividends on the Series D Preferred Stock have been declared and
have been, or are then being simultaneously, paid. For purposes hereof,
"Junior Stock" shall mean the Series A Preferred Stock and any other class
or series of equity securities of the Corporation not expressly ranking
senior to or on parity with the Series D Preferred Stock with respect to
payment of dividends or rights upon liquidation, dissolution or winding
up. "Parity Stock" shall mean any class or series of equity securities of
the Corporation expressly on parity with the Series D Preferred Stock, as
to the payment of dividends and as to distribution of assets upon
liquidation, dissolution or winding up, whether the dividend rates,
dividend payment dates or redemption or liquidation prices per share
thereof be different from those of the Series D Preferred Stock, if the
holders of such class of stock or series and the Series D Preferred Stock
shall be entitled to the receipt of dividends and of amounts distributable
upon liquidation, dissolution or winding up in proportion to their
respective amounts of accumulated but unpaid dividends per share or
liquidation preferences, without preference or priority one over the
other. The Series D-1 Preferred Stock shall be Parity Stock with respect
to the Series D-2 Preferred Stock, and the Series D-2 Preferred Stock
shall be Parity Stock with respect to the Series D-1 Preferred Stock.
2. LIQUIDATION, DISSOLUTION OR WINDING UP; CERTAIN MERGERS,
CONSOLIDATIONS AND ASSET SALES
(a) PAYMENTS TO HOLDERS OF SERIES D PREFERRED STOCK. In the event of
any Liquidation (as hereinafter defined), the holders of shares of Series
D Preferred Stock then outstanding shall be entitled to be paid out of the
assets of the Corporation available for distribution to its stockholders,
before any payment shall be made to the holders of Common Stock or Junior
Stock by reason of
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their ownership thereof, an amount per share equal to the greater of (i)
the Stated Value, plus any accumulated but unpaid dividends with respect
thereto, and (ii) such amount per share as would have been payable had
each such share been converted into Common Stock pursuant to Section 4
below immediately prior to such Liquidation (the amount payable pursuant
to this sentence is hereinafter referred to as the "Series D Liquidation
Amount"). If upon any such Liquidation the remaining assets of the
Corporation available for distribution to its stockholders shall be
insufficient to pay the holders of shares of Series D Preferred Stock and
any Parity Stock (as defined below) the full amount to which they shall be
entitled, the holders of shares of Series D Preferred Stock and any Parity
Stock shall share ratably in any distribution of the remaining assets and
funds of the Corporation in proportion to the respective amounts that
would otherwise be payable in respect of the shares held by them upon such
distribution if all amounts payable on or with respect to such shares were
paid in full. A "Liquidation" shall mean any of the following: (A) a
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, or (B) a Deemed Liquidation Event (as defined
below).
(b) PAYMENTS TO HOLDERS OF JUNIOR STOCK. After the payment of all
preferential amounts required to be paid to the holders of Series D
Preferred Stock, any Parity Stock and any other class or series of stock
of the Corporation ranking on liquidation senior to the Series D Preferred
Stock, upon the dissolution, liquidation or winding up of the Corporation,
the holders of shares of Junior Stock then outstanding shall be entitled
to receive the remaining assets and funds of the Corporation available for
distribution to its stockholders.
(c) DEEMED LIQUIDATION EVENTS
(i) The following events shall be deemed to be a liquidation
of the Corporation for purposes of this Section 2 (a "Deemed
Liquidation Event"):
(A) a merger, consolidation, recapitalization,
reorganization or other transaction in which:
(I) the Corporation is a constituent party or
(II) a subsidiary of the Corporation is a
constituent party and the Corporation issues
shares of its capital stock pursuant to such
merger or consolidation,
except any such merger, consolidation,
recapitalization, reorganization or other transaction
involving the Corporation or a subsidiary in which
the holders of capital stock of the Corporation
immediately prior to such merger or consolidation
continue to hold immediately following such merger or
consolidation, recapitalization, reorganization or
other transaction, at least 51%, by voting power and
economic interest, of the capital stock of (1) the
surviving or resulting corporation or (2) if the
surviving or resulting corporation is a wholly owned
subsidiary of another corporation immediately
following such merger or consolidation, the parent
corporation of such surviving or resulting
corporation; or
(B) the sale, in a single transaction or series of
related transactions, by the Corporation of all or
substantially all the assets of the Corporation
(except where such sale is to a wholly owned
subsidiary of the Corporation).
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(ii) The Corporation shall not effect any transaction
constituting a Deemed Liquidation Event pursuant to Subsection
2(c)(i)(A) above unless (A) the agreement or plan of merger or
consolidation provides that the consideration payable to the
stockholders of the Corporation shall be allocated among the holders
of capital stock of the Corporation in accordance with Subsections
2(a) and 2(b) above or (B) the holders of at least a majority of the
then-outstanding shares of Series D-1 Preferred Stock and the
then-outstanding shares of Series D-2 Preferred Stock specifically
consent in writing to the allocation of such consideration in a manner
different from that provided in Subsections 2(a) and 2(b) above.
(iii) In the event of a Deemed Liquidation Event pursuant to
Subsection 2(c)(i)(B) above, the Corporation shall use its reasonable
best efforts to distribute to each holder of Series D Preferred Stock,
in respect of each share of Series D Preferred Stock held by such
holder, the Series D Liquidation Amount within ten Trading Days of the
consummation of such Deemed Liquidation Event. If such distribution
has not occurred, then (A) the Corporation shall deliver a written
notice to each of the holders of Series D Preferred Stock no later
than fifteen Trading Days after the Deemed Liquidation Event advising
such holders of their right (and the requirements to be met to secure
such right) pursuant to the terms of the following clause (B) to
require the redemption of such shares of Series D Preferred Stock, and
(B) if the holders of at least a majority of the then-outstanding
shares of Series D-1 Preferred Stock or Series D-2 Preferred Stock so
request in a written instrument delivered to the Corporation (a
"Required Distribution Notice") not later than thirty Trading Days
after such Deemed Liquidation Event (which period shall be extended by
any period of noncompliance of the Corporation with clause (A) above),
the Corporation shall use the consideration received by the
Corporation, directly or indirectly, as a result of such Deemed
Liquidation Event (net of any liabilities associated with the assets
sold or technology licensed, as determined in good faith by the
members of the Board of Directors of the Corporation), to the extent
legally available therefor (the "Net Proceeds"), to redeem, on a date
not later than forty-five Trading Days after such Deemed Liquidation
Event (the "Liquidation Redemption Date"), all outstanding shares of
Series D-1 Preferred Stock and/or Series D-2 Preferred Stock, as
applicable, at a price per share equal to the Series D Liquidation
Amount. In the event of a redemption pursuant to the preceding
sentence, if the Net Proceeds are not sufficient to redeem all
outstanding shares of Series D-1 Preferred Stock and/or Series D-2
Preferred Stock, as applicable, the Corporation shall redeem a pro
rata portion of each holder's shares of Series D-1 Preferred Stock or
Series D-2 Preferred Stock, as applicable. In no event shall a holder
of Series D Preferred Stock receive more than such holder would
receive if all holders of Series D Preferred Stock gave a Required
Distribution Notice. The provisions of Section 6 below shall apply,
with such necessary changes in the details thereof as are necessitated
by the context, to the redemption of the Series D Preferred Stock
pursuant to this Subsection 2(c)(iii). Prior to the distribution or
redemption provided for in this Subsection 2(c)(iii), the Corporation
shall not expend or dissipate the consideration received for such
Deemed Liquidation Event, except to discharge expenses incurred in the
ordinary course of business.
(iv) The amount deemed paid or distributed to the holders of
capital stock of the Corporation upon any such merger, consolidation,
sale or redemption shall be the cash or the value of the property,
rights or securities paid or distributed to such holders by the
Corporation or the acquiring person, firm or other entity. The value
of such property, rights or securities shall be determined in good
faith by the Board of Directors of the Corporation.
(d) The Corporation shall mail written notice of any Liquidation to
each holder of Series D Preferred Stock not less than twenty days prior to
the payment date or effective date thereof.
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3. VOTING
(a) GENERAL VOTING RIGHTS. On any matter (other than, in the case of
the Series D-1 Preferred Stock, the election of the directors) presented
to the stockholders of the Corporation for their action or consideration
at any meeting of stockholders of the Corporation (or by written action of
stockholders in lieu of meeting), each holder of outstanding shares of
Series D Preferred Stock shall be entitled to the number of votes equal to
the number of whole shares of Common Stock into which the shares of Series
D Preferred Stock held by such holder are convertible (subject to the
limitations of Section 12 below) as of the record date for determining
stockholders entitled to vote on such matter; PROVIDED, HOWEVER, in no
event shall any share of Series D Preferred Stock be entitled to more
votes than the Maximum Per Share Preferred Vote (as defined below). Except
as provided by law or by the provisions of Subsection 3(b) or 3(c) below,
holders of Series D Preferred Stock shall vote together with the holders
of Common Stock, and with the holders of any other series of Preferred
Stock the terms of which so provide, as a single class.
As used herein, the "Maximum Per Share Preferred Vote" for each share
of Series D-1 Preferred Stock shall be the lesser of (i) ____(1) or such
greater number of votes as may be specifically permitted under then
applicable rules or regulation of the Nasdaq National Market or other
applicable market or exchange, and (ii) the number of shares of Common
Stock into which each share of Series D-1 Preferred Stock is convertible
as of 5:00 P.M. on the record date for the vote.
(b) ELECTIONS OF DIRECTORS. Except as otherwise provided below in
this Section 3(b), the holders of the shares of Series D-1 Preferred
Stock, exclusively and as a separate class, shall be entitled to elect a
number of directors of the Corporation as provided below, and the holders
of the shares of Common Stock and of any other class or series of voting
stock (but excluding the Series D-1 Preferred Stock), exclusively and as a
separate class, shall, subject to the rights of any additional series of
Preferred Stock that may be established from time to time, be entitled to
elect the balance of the total number of directors of the Corporation. For
so long as at least 60,060 shares of Series D-1 Preferred Stock are
outstanding, the holders of Series D-1 Preferred Stock shall be entitled
to elect a number of directors equal to, rounding to the closest whole
number, with .5 being rounded up, (except that rounding shall be down to
the closest whole number in the event that rounding up would permit the
Series D-1 Preferred Stock to elect fifty percent (50%) or more of the
board of directors), the product of (i) the total number of directors to
be on the Board of Directors immediately following an election of
directors, multiplied by (ii) a fraction, of which (A) the numerator shall
be the aggregate Maximum Per Share Preferred Votes for all shares of
Series D-1 Preferred Stock outstanding at the time of the vote and (B) the
denominator shall be the sum of (x) the total number of shares of Common
Stock outstanding as of the record date for the vote, (y) the aggregate
Maximum Per Share Preferred Votes for all shares of Series D-1 Preferred
Stock outstanding as of 5:00 P.M. on the record date for the vote, and (z)
for each other security of the Corporation, including the Series D-2
Preferred Stock, entitled to vote in an election for directors as of the
record date for the vote, the least of (I) the maximum vote permitted
under the Certificate of Incorporation, (II) the maximum vote permitted
under any Certificate of Designation of this Corporation and (III) the
maximum vote permitted under any applicable law, rule or regulation. At
any meeting held for the purpose of electing directors, the presence in
person or by proxy of the holders of a majority of the shares of Series
D-1 Preferred Stock then outstanding shall constitute a
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(1) Insert number equal to the lesser of the initial Stated Value of a Series D
Preferred Share divided by the average of the closing bid prices of the
Common Stock for the five days preceding the Closing Date for the Series D
Preferred.
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quorum of the Series D-1 Preferred Stock for the purpose of electing
directors by holders of the Series D-1 Preferred Stock. A vacancy in any
directorship filled by the holders of Series D-1 Preferred Stock shall be
filled only by vote or written consent in lieu of a meeting of the holders
of the Series D-1 Preferred Stock or by any remaining director or
directors elected by the holders of Series D-1 Preferred Stock pursuant to
this Subsection 3(b).
(c) SERIES VOTING RIGHTS. The Corporation shall not, without the
written consent or affirmative vote of the holders of a majority of the
shares of (i) Series D-1 Preferred Stock then outstanding, and (ii) with
respect to Subsection 3(c)(i) through Subsection 3(c)(v) (inclusive)
below, Series D-2 Preferred Stock, in each case given in writing or by
vote at a meeting, consenting or voting (as the case may be) separately as
a class:
(i) amend the Certificate of Incorporation, including this
Certificate of Designation, so as to amend, alter or
repeal the powers, preferences or special rights of the
Series D Preferred Stock in a manner that adversely
affects the rights, preferences or privileges of the
holders of Series D Preferred Stock, PROVIDED that nothing
in this Subsection 3(c)(i) shall prohibit the Corporation
from effecting a Deemed Liquidation Event so long as the
Corporation complies with the provisions of Subsections
2(c)(ii) through (iv) (inclusive) above;
(ii) authorize, designate or issue any Parity Stock or any
class of stock of the Corporation ranking senior to the
Series D Preferred Stock as to the payment of dividends
and as to distribution of assets upon Liquidation ("Senior
Stock");
(iii) amend the Certificate of Incorporation to authorize any
additional shares of Series D Preferred Stock, Parity
Stock or Senior Stock;
(iv) amend, alter or repeal any provision of this Certificate
of Designations, PROVIDED that nothing in this Subsection
3(c)(iv) shall prohibit the Corporation from effecting a
Deemed Liquidation Event so long as the Corporation
complies with the provisions of Subsections 2(c)(ii)
through (iv) (inclusive) above;
(v) amend, alter or repeal the Bylaws of the Corporation in
any way that is inconsistent with this Certificate of
Designations;
(vi) take any action to decrease the number of directors of the
Corporation to less than five;
(vii) apply any of its assets in excess of $7,500,000 in any
12-month period to the redemption, retirement, purchase or
acquisition, directly or indirectly (including through a
Corporation Subsidiary), of any shares of capital stock of
the Corporation (including securities convertible into or
exchangeable for such capital stock), other than (A)
redemptions of Preferred Stock in accordance with the
terms of the Certificate of Incorporation, (B) repurchases
of Common Stock from employees and consultants who
received the stock in connection with their performance of
services at cost upon termination of employment or
service, (C) redemptions, retirements, repurchases or
acquisitions of 5 1/4% Convertible Subordinated Debentures
due June 15, 2005 of the Corporation ("Convertible
Debentures"), and (D) repurchases made with the proceeds
of an issuance of Junior Stock, except where such proceeds
are used to repurchase securities from any officer or
director of the Corporation;
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(viii) acquire all or substantially all of the assets or stock of
any class of any other corporation, or any equity interest
in any partnership, limited liability company, joint
venture, association, joint stock company or trust where
the aggregate consideration paid by the Corporation (as
determined in good faith by the directors of the
Corporation at the time definitive agreements are entered
into) for such acquisition is greater than $80,000,000; or
(ix) incur any indebtedness for borrowed money, which for
purposes of this paragraph shall exclude the Convertible
Debentures, or permit any Corporation Subsidiary to incur
any indebtedness (other than indebtedness of Corporation
Subsidiaries owed to the Corporation or other intercompany
indebtedness), in excess of, at any time, the greater of
(A) $50,000,000; or (B) $65,000,000 less the aggregate
principal amount of the then-outstanding Convertible
Debentures.
For purposes of this Subsection 3(c), the term "Corporation Subsidiary"
shall mean any corporation, partnership, trust, limited liability company
or other non-corporate business enterprise in which the Corporation (or
another Corporation Subsidiary) holds stock or other ownership interests
representing (1) more than 50% of the voting power of all outstanding
stock or ownership interests of such entity or (2) the right to receive
more than 50% of the net assets of such entity available for distribution
to the holders of outstanding stock or ownership interests upon a
liquidation or dissolution of such entity. The rights of the holders of
the Series D-1 Preferred Stock under Subsections 3(c)(vi) through
(3)(c)(viii) above shall terminate on the first date on which there are
fewer than 30,030 outstanding shares of Series D-1 Preferred Stock.
At any meeting held for the purpose of voting on any of the matters for
which the holders of the Series D-1 Preferred Stock or Series D-2
Preferred Stock have class voting rights, the presence in person or by
proxy of the holders of a majority of the shares of Series D-1 Preferred
Stock then outstanding or the Series D-2 Preferred Stock then outstanding,
as the case may be, shall constitute a quorum of the Series D-1 Preferred
Stock or Series D-2 Preferred Stock for the purpose of voting on matters
to which these class voting rights apply.
4. OPTIONAL CONVERSION
The holders of the Series D Preferred Stock shall have conversion rights
as follows (the "Conversion Rights"):
(a) RIGHT TO CONVERT. Each share of Series D Preferred Stock shall
be convertible, at the option of the holder thereof, at any time and
from time to time, and without the payment of additional consideration
by the holder thereof, into such number of fully paid and non-assessable
shares of Common Stock as is determined by dividing the Stated Value of
such shares by the Series D Conversion Price (as defined below) in
effect on the Conversion Date (as defined below). The "Series D
Conversion Price" initially shall be $9.99(2). Such initial Series D
Conversion Price, and the rate at which shares of Series D Preferred
Stock may be converted into shares of Common Stock, shall be subject to
adjustment as provided below. In the event of a notice of redemption of
any shares of Series D Preferred Stock pursuant to Section 6 below, the
Conversion Rights of the shares of Series D Preferred Stock designated
for redemption shall terminate at 5:00 p.m., Eastern time, on the last
full day preceding the applicable Redemption Date (as defined below),
unless the Redemption Price (as defined below) is not paid or tendered
for payment on the Redemption Date, in which case the Conversion Rights
for such shares shall continue until such price is paid, or tendered for
payment, in full. In the event of a liquidation, dissolution or winding
up of the Corporation, (i) the Conversion Rights shall terminate at 5:00
p.m., Eastern time, on the last full day
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(2) Assuming stockholder approval of the one for three reverse stock split
approved by the Board of Directors on June 1, 2003.
<Page>
preceding the date fixed for the payment of any such amounts distributable
on such event to the holders of Series D Preferred Stock (unless such
amounts are not paid or tendered for payment on the Redemption Date, in
which case the Conversion Rights for such shares shall continue until such
amounts are paid, or tendered for payment, in full) and (ii) the
Corporation shall provide to each holder of shares of Series D Preferred
Stock notice of such liquidation, dissolution or winding up, which notice
shall (A) be sent at least 20 days (unless a greater period is required by
law) prior to the termination of the Conversion Rights and (B) state the
amount per share of Series D Preferred Stock that will be paid or
distributed on such liquidation, dissolution or winding up and in
reasonable detail the manner of calculation thereof. For the purposes of
this Subsection 4(a), "Redemption Date" shall mean any Mandatory
Redemption Date (as defined below) or Optional Redemption Date (as defined
below) and "Redemption Price" shall mean, as applicable, the Mandatory
Redemption Price (as defined below) or the Optional Redemption Price (as
defined below).
(b) PAYMENT IN LIEU OF ACCUMULATED DIVIDENDS. Upon conversion of a
share of Series D Preferred Stock in accordance with this Section 4, as
part of the conversion, the Corporation shall pay to the holder thereof an
amount equal to the total accumulated but unpaid dividends on such share.
The Corporation shall pay such amount in cash or if the conditions set
forth in Section 1(b)(ii) above are satisfied, in Common Stock, in its
sole discretion. If the Corporation elects to pay such amount in shares of
Common Stock, the number of shares of Common Stock to be issued shall
equal the quotient of (i) such amount divided by (ii) the arithmetic
average of the Average Daily Prices for five consecutive Trading Days, the
last day of which shall be the second Trading Day preceding the date on
which the amount is paid. To the extent the Corporation elects to pay such
accumulated but unpaid dividends in shares of Common Stock, (i) the
Corporation shall immediately notify such holder within two Trading Days
of the Conversion Date in accordance with the notice provisions of Section
13 below and (ii) such election may not be revoked or otherwise changed by
the Corporation. In the event the Corporation fails to deliver a notice
that it intends to pay dividends in Common Stock within two Trading Days
as required above, the Corporation shall pay such dividend in cash. All
accrued but unpaid dividends paid by the Corporation in Common Stock
pursuant to this Subsection 4(b) shall be paid by the Corporation on the
tenth Trading Day following the applicable Conversion Date. All
accumulated but unpaid dividends paid by the Corporation in cash pursuant
to this Subsection 4(b) shall be paid by the Corporation on the fourth
Trading Day following the applicable Conversion Date.
(c) FRACTIONAL SHARES. No fractional shares of Common Stock shall be
issued upon conversion of the Series D Preferred Stock pursuant to this
Section 4. In lieu of any fractional shares to which the holder would
otherwise be entitled, the Corporation shall pay cash equal to such
fraction multiplied by the then-effective Series D Conversion Price. The
Corporation shall, as soon as practicable after the Conversion Date, and
in no event later than three Trading Days after the Conversion Date, pay
to such holder any cash payable in lieu of any such fraction of a share.
(d) MECHANICS OF CONVERSION
(i) In order for a holder of Series D Preferred Stock to
convert shares of Series D Preferred Stock into shares of Common
Stock, such holder shall deliver to the office of the transfer agent
for the Series D Preferred Stock (or at the principal office of the
Corporation if the Corporation serves as its own transfer agent) a
written notice (the "Conversion Notice") that such holder elects to
convert all or any number of the shares of the Series D Preferred
Stock represented by such certificate or certificates. The Conversion
Notice shall state such holder's name or the names of the nominees in
which such holder wishes the certificate or certificates for shares of
Common Stock to be issued. If required by the Corporation,
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certificates surrendered for conversion shall be accompanied by a
written instrument evidencing such holder's desire to convert a
specified number of shares of Series D Preferred Stock, duly executed
by the registered holder or such holder's attorney duly authorized in
writing. The date specified by the holder in the notice shall be the
conversion date or, if no date is specified in the Conversion Notice,
the conversion date shall be the date the Conversion Notice is
delivered to the Corporation (as determined in accordance with the
notice provisions hereof; such date, the "Conversion Date"). The
shares of Common Stock issuable upon conversion of the shares
represented by the certificate or certificates delivered to the
Corporation shall be deemed to be outstanding as of the Conversion
Date. On or before the Conversion Date, the holders shall surrender a
certificate or certificates for the shares to be converted (or an
affidavit of loss and indemnity agreement relating thereto) to the
office of the transfer agent for the Series D Preferred (or at the
principal office of the Corporation if the Corporation serves as its
own transfer agent). Upon surrender of a certificate following one or
more partial conversions, the Corporation shall promptly deliver to
such holder a new certificate representing the remaining shares of
Series D Preferred Stock. Upon conversion of any Series D Preferred
Stock, the Corporation shall promptly (but in no event later than
three Trading Days after the Conversion Date) issue or cause to be
issued and cause to be delivered to, or upon the written order of,
such holder (or former holder, as the case may be) of Series D
Preferred Stock and in such name or names as such holder may
designate, a certificate for the shares of Common Stock issuable upon
such conversion, free of restrictive legends unless such shares of
Common Stock are not then freely transferable without volume
restrictions pursuant to Rule 144(k) under the Securities Act. Such
holder, or any person so designated by such holder to receive such
shares of Common Stock, shall be deemed to have become holder of
record of such shares of Common Stock as of the Conversion Date. If
and when such shares of Common Stock may be freely transferred
pursuant to Rule 144 under the Securities Act or pursuant to an
effective registration statement, the Corporation shall use its best
efforts to deliver such shares of Common Stock electronically through
the Depository Trust Corporation or another established clearing
corporation performing similar functions, and shall issue such shares
of Common Stock in the same manner as dividend payment shares are
issued pursuant to Section 1(b)(iii) above.
(ii) The Corporation covenants that it shall at all times when
the Series D Preferred Stock shall be outstanding, reserve and keep
available out of its authorized but unissued stock, for the purpose of
effecting the conversion of the Series D Preferred Stock, such number
of its duly authorized but unissued and otherwise unreserved shares of
Common Stock as shall from time to time be sufficient to effect the
conversion of all outstanding Series D Preferred Stock or, if the
number of shares of Common Stock so reserved is insufficient, the
Corporation shall take any corporation action that is necessary to
make available a sufficient number of authorized but unissued and
otherwise unreserved shares of Common Stock within 90 days after the
occurrence of such deficiency. Before taking any action that would
cause an adjustment reducing the Series D Conversion Price below the
then par value of the Common Stock, the Corporation shall take any
corporate action that may, in the opinion of its counsel, be necessary
in order that the Corporation may validly and legally issue fully paid
and non-assessable shares of Common Stock at such adjusted Series D
Conversion Price.
(iii) Upon any such conversion, shares of Common Stock issued
upon conversion of such shares of Series D Preferred Stock shall not
be deemed Additional Shares of Common Stock (as defined below) and no
adjustment to the Series D Conversion Price shall be made for any
accumulated but unpaid dividends on the Series D Preferred Stock
surrendered for conversion or on the Common Stock delivered upon
conversion.
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<Page>
(iv) All shares of Series D Preferred Stock that shall have
been surrendered for conversion as herein provided shall no longer be
deemed to be outstanding and all rights with respect to such shares,
including the rights, if any, to receive notices and to vote, shall
immediately cease and terminate on the Conversion Date, except for the
right of the holders thereof to receive shares of Common Stock and
cash, if any, in accordance with Subsections 4(b) and 4(c) above. Any
shares of Series D Preferred Stock so converted shall be retired and
canceled and shall not be reissued, and the Corporation (without the
need for action by the holders of Series D Preferred Stock or any
other stockholders) may from time to time take such appropriate action
as may be necessary to reduce the authorized number of shares of
Series D Preferred Stock accordingly.
(v) The Corporation shall pay any and all issue and other
similar taxes that may be payable in respect of any issuance or
delivery of shares of Common Stock upon conversion of shares of Series
D Preferred Stock pursuant to this Section 4. The Corporation shall
not, however, be required to pay any tax that may be payable in
respect of any transfer involved in the issuance and delivery of
shares of Common Stock in a name other than that in which the shares
of Series D Preferred Stock so converted were registered, and no such
issuance or delivery shall be made unless and until the person or
entity requesting such issuance has paid to the Corporation the amount
of any such tax or has established, to the reasonable satisfaction of
the Corporation, that such tax has been paid.
(e) ADJUSTMENTS TO SERIES D CONVERSION PRICE FOR DILUTING ISSUES
(i) SPECIAL DEFINITIONS. For purposes of this Section 4, the
following definitions shall apply:
(A) "Option" shall mean any rights, options or warrants
to subscribe for, purchase or otherwise acquire
Common Stock or Convertible Securities.
(B) "Series D Original Issue Date" shall mean the date on
which a share of Series D Preferred Stock was first
issued, regardless of the number of times the
transfer of such share shall be made on the
Corporation's stock transfer records and regardless
of the number of certificates that may be issued to
evidence such share.
(C) "Convertible Securities" shall mean any evidences of
indebtedness, shares or other securities directly or
indirectly convertible into or exchangeable for
Common Stock, but excluding Options.
(D) "Additional Shares of Common Stock" shall mean all
shares of Common Stock issued (or, pursuant to
Subsection 4(e)(iii) below, deemed to be issued) by
the Corporation after the Series D Original Issue
Date, other than shares of Common Stock issued,
issuable or deemed issued:
(I) as a dividend or distribution on Series D
Preferred Stock;
(II) by reason of a dividend, stock split, split-up
or other distribution on shares of Common Stock
that is covered by Subsection 4(f) or 4(g)
below;
(III) to employees or directors of, or consultants
to, the Corporation or any of
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<Page>
its subsidiaries pursuant to a plan, agreement
or arrangement approved by the Board of
Directors of the Corporation and by a majority
of the directors of the Corporation who are
eligible to serve on the Audit Committee of
such Board under the then-applicable rules of
the Securities and Exchange Commission and the
Nasdaq National Market (or other market or
exchange on which the Common Stock is then
traded or authorized for quotation);
(IV) to Accenture LLP pursuant to agreements in
effect on June 1, 2003; or
(V) in connection with any transaction with any
strategic investor, vendor or customer, lessor,
customer, supplier, marketing partner,
developer or integrator or any similar
arrangement, in each case the primary purpose
of which is not to raise equity capital,
provided such issuance is approved by the Board
of Directors of the Corporation and by a
majority of the directors of the Corporation
who are eligible to serve on the Audit
Committee of such Board under the
then-applicable rules of the Securities and
Exchange Commission and the Nasdaq National
Market (or other market or exchange on which
the Common Stock is then traded or authorized
for quotation).
(ii) NO ADJUSTMENT OF SERIES D CONVERSION PRICE. No adjustment
in the Series D Conversion Price shall be made as the result of the
issuance of Additional Shares of Common Stock if the consideration per
share (determined pursuant to Subsection 4(e)(v) below) for such
Additional Share of Common Stock issued or deemed to be issued by the
Corporation is equal to or greater than the applicable Series D
Conversion Price in effect immediately prior to the issuance or deemed
issuance of such Additional Shares of Common Stock. In addition, no
adjustment in the Series D Conversion Price shall be made (A) with
respect to the Series D-1 Preferred Stock, if prior to such issuance
or deemed issuance of Additional Shares of Common Stock, the
Corporation receives written notice from the holders of at least a
majority of the shares of Series D-1 Preferred Stock then outstanding
agreeing that no such adjustment shall be made as a result of such
issuance or deemed issuance and (B) with respect to the Series D-2
Preferred Stock, if prior to such issuance or deemed issuance of
Additional Shares of Common Stock, the Corporation receives written
notice from the holders of at least a majority of the shares of Series
D-2 then outstanding agreeing that no such adjustment shall be made as
a result of such issuance or deemed issuance.
(iii) ISSUE OF SECURITIES TO BE A DEEMED ISSUE OF ADDITIONAL
SHARES OF COMMON STOCK
(A) If the Corporation at any time or from time to time
after the Series D Original Issue Date shall issue
any Options or Convertible Securities (excluding
Options or Convertible Securities that, upon
exercise, conversion or exchange thereof, would
entitle the holder thereof to receive shares of
Common Stock that are specifically excepted from the
definition of Additional Shares of Common Stock by
Subsection 4(e)(i)(D) above) or shall fix a record
date for the determination of holders of any class of
securities entitled to receive any such Options or
Convertible Securities, then the maximum number of
shares of Common Stock (as set forth in the
instrument relating thereto without regard to any
provision contained therein for a subsequent
adjustment of such number) issuable upon the exercise
of such Options or, in the case of Convertible
Securities and Options therefor, the conversion or
exchange of
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<Page>
such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the
time of such issue or, in case such a record date
shall have been fixed, as of the close of business on
such record date.
(B) If the terms of any Option or Convertible Security,
the issuance of which resulted in an adjustment to
the Series D Conversion Price pursuant to the terms
of Subsection 4(e)(iv) below, are revised (either
automatically pursuant the provisions contained
therein or as a result of an amendment to such terms)
to provide for either (1) any increase or decrease in
the number of shares of Common Stock issuable upon
the exercise, conversion or exchange of any such
Option or Convertible Security or (2) any increase or
decrease in the consideration payable to the
Corporation upon such exercise, conversion or
exchange, then, effective upon such increase or
decrease becoming effective, the Series D Conversion
Price computed upon the original issue of such Option
or Convertible Security (or upon the occurrence of a
record date with respect thereto) shall be readjusted
prospectively to such Series D Conversion Price as
would have obtained had such revised terms been in
effect upon the original date of issuance of such
Option or Convertible Security. Notwithstanding the
foregoing, no adjustment pursuant to this clause (B)
shall have the effect of increasing the Series D
Conversion Price to an amount that exceeds the lower
of (i) the Series D Conversion Price on the original
adjustment date, or (ii) the Series D Conversion
Price that would have resulted from any issuances of
Additional Shares of Common Stock between the
original adjustment date and such readjustment date.
(C) If the terms of any Option or Convertible Security
(excluding Options or Convertible Securities that,
upon exercise, conversion or exchange thereof, would
entitle the holder thereof to receive shares of
Common Stock that are specifically excepted from the
definition of Additional Shares of Common Stock by
Subsection 4(e)(i)(D) above), the issuance of which
did not result in an adjustment to the Series D
Conversion Price pursuant to the terms of Subsection
4(e)(iv) below (either because the consideration per
share (determined pursuant to Subsection 4(e)(v)
below) of the Additional Shares of Common Stock
subject thereto was equal to or greater than the
Series D Conversion Price then in effect, or because
such Option or Convertible Security was issued before
the Series D Original Issue Date), are revised after
the Series D Original Issue Date (either
automatically pursuant the provisions contained
therein or as a result of an amendment to such terms)
to provide for either (1) any increase or decrease in
the number of shares of Common Stock issuable upon
the exercise, conversion or exchange of any such
Option or Convertible Security or (2) any increase or
decrease in the consideration payable to the
Corporation upon such exercise, conversion or
exchange, then such Option or Convertible Security,
as so amended, and the Additional Shares of Common
Stock subject thereto (determined in the manner
provided in Subsection 4(e)(iii)(A) above) shall be
deemed to have been issued effective upon such
increase or decrease becoming effective.
(D) Upon the expiration or termination of any unexercised
Option or unconverted or unexchanged Convertible
Security that resulted (either upon its original
issuance or upon a revision of its terms) in an
adjustment to the Series D Conversion Price pursuant
to the terms of Subsection 4(e)(iv) below, the
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<Page>
Series D Conversion Price shall be readjusted
prospectively to such Series D Conversion Price as
would have obtained had such Option or Convertible
Security never been issued.
(E) No adjustment in the Series D Conversion Price shall
be made upon the issue of shares of Common Stock or
Convertible Securities upon the exercise of Options
or the issue of shares of Common Stock upon the
conversion or exchange of Convertible Securities.
(iv) ADJUSTMENT OF SERIES D CONVERSION PRICE UPON ISSUANCE OF
ADDITIONAL SHARES OF COMMON STOCK. In the event the Corporation shall
at any time after the Series D Original Issue Date issue Additional
Shares of Common Stock (including Additional Shares of Common Stock
deemed to be issued pursuant to Subsection 4(e)(iii) above), without
consideration or for a consideration per share less than the
applicable Series D Conversion Price in effect immediately prior to
such issue, then the Series D Conversion Price shall be reduced,
concurrently with such issue, to a price (calculated to the nearest
cent) determined by multiplying such Series D Conversion Price by a
fraction, (A) the numerator of which shall be (1) the number of shares
of Common Stock outstanding immediately prior to such issue plus (2)
the number of shares of Common Stock that the aggregate consideration
received or to be received by the Corporation for the total number of
Additional Shares of Common Stock so issued would purchase at such
Series D Conversion Price; and (B) the denominator of which shall be
the number of shares of Common Stock outstanding immediately prior to
such issue plus the number of such Additional Shares of Common Stock
so issued; provided that, (i) for the purpose of this Subsection
4(e)(iv), all shares of Common Stock issuable upon conversion or
exercise of shares of Series D Preferred Stock, Options or Convertible
Securities outstanding immediately prior to such issue or upon
exercise of such securities shall be deemed to be outstanding, and
(ii) the number of shares of Common Stock deemed issuable upon
conversion of such outstanding shares of Series D Preferred Stock
shall be determined without giving effect to any adjustments to the
Series D Conversion Price resulting from the issuance of Additional
Shares of Common Stock that is the subject of this calculation.
(v) DETERMINATION OF CONSIDERATION. For purposes of this
Subsection 4(e), the consideration received by the Corporation for the
issue of any Additional Shares of Common Stock shall be computed as
follows:
(A) CASH AND PROPERTY. Such consideration shall:
(I) insofar as it consists of cash, be computed at
the aggregate amount of cash received by the
Corporation, excluding amounts paid or payable
for accrued interest;
(II) insofar as it consists of property other than
cash, be computed at the fair market value
thereof at the time of such issue, as
determined in good faith by the non-management
members of the Board of Directors of the
Corporation; and
(III) in the event Additional Shares of Common Stock
are issued together with other shares or
securities or other assets of the Corporation
for consideration that covers both, be the
proportion of such consideration so received,
computed as provided in clauses (I) and (II)
above, as determined in good faith by
non-management members of the Board of
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Directors of the Corporation.
(B) OPTIONS AND CONVERTIBLE SECURITIES. The consideration
per share received by the Corporation for Additional
Shares of Common Stock deemed to have been issued
pursuant to Subsection 4(e)(iii) above, relating to
Options and Convertible Securities, shall be
determined by dividing
(I) the total amount, if any, received or
receivable by the Corporation as consideration
for the issue of such Options or Convertible
Securities, plus the minimum aggregate amount
of additional consideration (as set forth in
the instruments relating thereto, without
regard to any provision contained therein for a
subsequent adjustment of such consideration)
payable to the Corporation upon the exercise of
such Options or the conversion or exchange of
such Convertible Securities, or in the case of
Options for Convertible Securities, the
exercise of such Options for Convertible
Securities and the conversion or exchange of
such Convertible Securities, by
(II) the maximum number of shares of Common Stock
(as set forth in the instruments relating
thereto, without regard to any provision
contained therein for a subsequent adjustment
of such number) issuable upon the exercise of
such Options or the conversion or exchange of
such Convertible Securities.
(vi) MULTIPLE CLOSING DATES. In the event the Corporation shall
issue on more than one date Additional Shares of Common Stock that are
comprised of shares of the same series or class of Preferred Stock and
that would result in an adjustment to the Series D Conversion Price
pursuant to the terms of Subsection 4(e)(iv) above, and such issuance
dates occur within a period of no more than 60 days, then, upon the
final such issuance, the Series D Conversion Price shall be readjusted
prospectively to give effect to all such issuances as if they occurred
on the date of the final such issuance (and without giving effect to
any adjustments as a result of such prior issuances within such
period).
(f) ADJUSTMENT FOR STOCK SPLITS AND COMBINATIONS. If the Corporation
shall at any time or from time to time after the Series D Original Issue
Date (i) effect a subdivision of the outstanding Common Stock (whether by
stock split, stock dividend or otherwise) without a corresponding
subdivision of the Series D Preferred Stock, or (ii) combine the
outstanding shares of Series D Preferred Stock (whether by reverse stock
split or otherwise) without a corresponding combination of the Common
Stock, the Series D Conversion Price in effect immediately before that
subdivision or combination shall be proportionately decreased. If the
Corporation shall at any time or from time to time after the Series D
Original Issue Date (x) combine the outstanding shares of Common Stock
(whether by reverse stock split or otherwise) without a corresponding
combination of the Series D Preferred Stock, or (y) effect a subdivision
of the outstanding shares of Series D Preferred Stock (whether by stock
split, stock dividend or otherwise) without a corresponding subdivision of
the Common Stock, the Series D Conversion Price in effect immediately
before the combination or subdivision shall be proportionately increased.
Any adjustment under this paragraph shall become effective at the close of
business on the date the subdivision or combination becomes effective.
(g) ADJUSTMENT FOR CERTAIN DIVIDENDS AND DISTRIBUTIONS. In the event
the Corporation at any time, or from time to time after the Series D
Original Issue Date shall make or issue, or fix a record date for the
determination of holders of Common Stock entitled to receive, a dividend
or other
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<Page>
distribution payable in additional shares of Common Stock, then and in
each such event the Series D Conversion Price in effect immediately before
such event shall be decreased as of the time of such issuance or, in the
event such a record date shall have been fixed, as of the close of
business on such record date, by multiplying the Series D Conversion Price
then in effect by a fraction:
(i) the numerator of which shall be the total number of shares
of Common Stock issued and outstanding immediately prior
to the time of such issuance or the close of business on
such record date, and
(ii) the denominator of which shall be the total number of
shares of Common Stock issued and outstanding immediately
prior to the time of such issuance or the close of
business on such record date plus the number of shares of
Common Stock issuable in payment of such dividend or
distribution;
PROVIDED, HOWEVER, that if such record date shall have been fixed and
such dividend is not fully paid or if such distribution is not fully
made on the date fixed therefor, the Series D Conversion Price shall be
recomputed accordingly as of the close of business on such record date
and thereafter the Series D Conversion Price shall be adjusted pursuant
to this paragraph as of the time of actual payment of such dividends or
distributions; and provided further, however, that no such adjustment
shall be made if the holders of Series D Preferred Stock simultaneously
receive (i) a dividend or other distribution of shares of Common Stock
in a number equal to the number of shares of Common Stock as they would
have received if all outstanding shares of Series D Preferred Stock had
been converted into Common Stock on the date of such event or (ii) a
dividend or other distribution of shares of Series D Preferred Stock
that are convertible, as of the date of such event, into such number of
shares of Common Stock as is equal to the number of additional shares of
Common Stock being issued with respect to each share of Common Stock in
such dividend or distribution.
(h) ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS. In the event
the Corporation at any time or from time to time after the Series D
Original Issue Date shall make or issue, or fix a record date for the
determination of holders of Common Stock entitled to receive, a dividend
or other distribution payable in securities of the Corporation (other than
shares of Common Stock) or in cash or other property, then and in each
such event provision shall be made so that the holders of the Series D
Preferred Stock shall receive upon conversion thereof, in addition to the
number of shares of Common Stock receivable thereupon, the kind and amount
of securities of the Corporation, cash or other property that they would
have been entitled to receive had the Series D Preferred Stock been
converted into Common Stock on the date of such event and had they
thereafter, during the period from the date of such event to and including
the conversion date, retained such securities receivable by them as
aforesaid during such period, giving application to all adjustments called
for during such period under this paragraph with respect to the rights of
the holders of the Series D Preferred Stock; provided, however, that no
such provision shall be made if the holders of Series D Preferred Stock
receive, simultaneously with the distribution to the holders of Common
Stock, a dividend or other distribution of such securities, cash or other
property in an amount equal to the amount of such securities, cash or
other property as they would have received if all outstanding shares of
Series D Preferred Stock had been converted into Common Stock on the date
of such event.
(i) ADJUSTMENT FOR MERGER OR REORGANIZATION, ETC. Subject to the
provisions of Subsection 2(c) above, if there shall occur any
reorganization, recapitalization, reclassification, consolidation or
merger involving the Corporation (which is not a Liquidation) in which the
Common Stock (but not the Series D Preferred Stock) is converted into or
exchanged for securities,
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cash or other property (other than a transaction covered by paragraph (e),
(f) or (g) of this Section 4), then, following any such reorganization,
recapitalization, reclassification, consolidation or merger, each share of
Series D Preferred Stock shall be convertible into the kind and amount of
securities, cash or other property that a holder of the number of shares
of Common Stock of the Corporation issuable upon conversion of one share
of Series D Preferred Stock immediately prior to such reorganization,
recapitalization, reclassification, consolidation or merger would have
been entitled to receive pursuant to such transaction; and, in such case,
appropriate adjustment (as determined in good faith by the Board of
Directors of the Corporation) shall be made in the application of the
provisions in this Section 4 with respect to the rights and interests
thereafter of the holders of the Series D Preferred Stock, to the end that
the provisions set forth in this Section 4 (including provisions with
respect to changes in and other adjustments of the Series D Conversion
Price) shall thereafter be applicable, as nearly as reasonably may be, in
relation to any securities or other property thereafter deliverable upon
the conversion of the Series D Preferred Stock.
(j) ROUNDING OF CALCULATIONS; MINIMUM ADJUSTMENTS. All calculations
under this Section 4 shall be made to the nearest one tenth of a cent. No
adjustment in the Series D Conversion Price is required if the amount of
such adjustment would be less than $0.01; provided, however, that any
adjustments which by reason of this Subsection 4(j) are not required to be
made will be carried forward and given effect in any subsequent
adjustment. The number of shares of Common Stock outstanding at any given
time shall not include shares owned or held by or for the account of the
Corporation, and the disposition of any such shares shall be considered an
issue or sale of Common Stock.
(k) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment pursuant to this Section 4, the Corporation at its expense will
promptly compute such adjustment in accordance with the terms hereof and
prepare a certificate describing in reasonable detail such adjustment and
the transactions giving rise thereto, including all facts upon which such
adjustment is based. Upon written request, the Corporation will promptly
deliver a copy of each such certificate to each holder of Series D
Preferred Stock and to the Corporation's Transfer Agent. The Corporation
shall, as promptly as reasonably practicable after the written request at
any time of any holder of Series D Preferred Stock (but in any event not
later than 10 days thereafter), furnish or cause to be furnished to such
holder a certificate setting forth (i) the Series D Conversion Price then
in effect, and (ii) the number of shares of Common Stock and the amount,
if any, of other securities, cash or property that then would be received
upon the conversion of Series D Preferred Stock.
(l) NOTICE OF RECORD DATE. In the event:
(i) the Corporation shall take a record of the holders of its
Common Stock (or other stock or securities at the time
issuable upon conversion of the Series D Preferred Stock)
for the purpose of entitling or enabling them to receive
any dividend or other distribution, or to receive any
right to subscribe for or purchase any shares of stock of
any class or any other securities, or to receive any other
right; or
(ii) of any capital reorganization of the Corporation, any
reclassification of the Common Stock of the Corporation,
any consolidation or merger of the Corporation with or
into another corporation (other than a consolidation or
merger in which the Corporation is the surviving entity
and its Common Stock is not converted into or exchanged
for any other securities or property), or any transfer of
all or substantially all of the assets of the Corporation;
or
(iii) of the voluntary or involuntary dissolution, liquidation
or winding-up of the
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Corporation,
then, and in each such case, the Corporation will send or cause to be
sent to the holders of the Series D Preferred Stock a notice specifying,
as the case may be, (i) the record date for such dividend, distribution
or right, and the amount and character of such dividend, distribution or
right, or (ii) the effective date on which such reorganization,
reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to
be fixed, as of which the holders of Common Stock (or such other stock
or securities at the time issuable upon the conversion of the Series D
Preferred Stock) shall be entitled to exchange their shares of Common
Stock (or such other stock or securities) for securities or other
property deliverable upon such reorganization, reclassification,
consolidation, merger, transfer, dissolution, liquidation or winding-up.
Any notice required under this Subsection 4(l) shall be sent at least 20
days prior to the record date or effective date for the event specified
in such notice.
5. REDEMPTION AT THE OPTION OF THE CORPORATION
(a) MANDATORY REDEMPTION EVENT. All or any portion of the outstanding
shares of Series D Preferred Stock shall be redeemed at a price per share
equal to (i) 125% of Stated Value plus (ii) all accumulated but unpaid
dividends (the "Mandatory Redemption Price") in accordance with this
Section 5 pursuant to written notice (the "Mandatory Redemption Notice")
delivered to the holders of Series D Preferred Stock by the Corporation,
in its sole discretion, at any time or from time to time after the third
anniversary of the Series D Original Issue Date; provided that the
Corporation shall be entitled to deliver a Mandatory Redemption Notice
only if the Average Daily Price on each Trading Day for a period of at
least 45 consecutive Trading Days (such period ending no earlier than four
Trading Days prior to the date of such Mandatory Redemption Notice) has
exceeded $22.80(3) (subject to appropriate adjustment in the event of any
stock dividend, stock split, reverse stock split, combination, split-up,
recapitalization and like occurrences on or after the Series D Original
Issue Date affecting such shares). Any Mandatory Redemption Notice
delivered pursuant to this Subsection 5(a) shall specify a date (a
"Mandatory Redemption Date") as of which such redemption shall be
effected. Each Mandatory Redemption Date shall be a Trading Day not less
than 20 Trading Days nor more than 30 Trading Days following the date on
which the related Mandatory Redemption Notice is sent by the Corporation.
On each Mandatory Redemption Date, the Corporation shall redeem, on a pro
rata basis in accordance with the number of shares of Series D Preferred
Stock owned by each holder, that number of outstanding shares of Series D
Preferred Stock specified in the related Mandatory Redemption Notice.
(b) MANDATORY REDEMPTION NOTICE. Any Mandatory Redemption Notice
shall be delivered to each holder of record of Series D Preferred Stock,
as applicable, in accordance with the notice provisions set forth in
Section 13 below. Each Mandatory Redemption Notice shall state:
(i) the Mandatory Redemption Date;
(ii) the Mandatory Redemption Price;
(iii) the number of shares of Series D Preferred Stock held by
the holder that the Corporation shall redeem on the
Mandatory Redemption Date;
(iv) the date upon which the holder's right to convert such
shares terminates (as determined in accordance with
Section 4 above); and
(v) that the holder is to surrender to the Corporation, in the
manner and at the place
- ----------
(3) Assuming stockholder approval of the one for three reverse stock split
approved by the Board of Directors on June 1, 2003.
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designated, its certificate or certificates (or an
affidavit of loss and indemnity agreement for such
certificates) representing the shares of Series D
Preferred Stock to be redeemed.
(c) SURRENDER OF CERTIFICATES; PAYMENT. On or before the applicable
Mandatory Redemption Date, each holder of shares of Series D Preferred
Stock to be redeemed on such Mandatory Redemption Date, unless such holder
has exercised its right to convert such shares as provided in Section 4
above, shall surrender the certificate or certificates (or deliver an
affidavit of loss and indemnity agreement for such certificates)
representing such shares to the Corporation, in the manner and at the
place designated in the Mandatory Redemption Notice, and thereupon the
Mandatory Redemption Price for such shares shall be payable to the order
of the person whose name appears on such certificate or certificates as
the owner thereof, and each surrendered certificate shall be canceled and
retired. In the event less than all of the shares of Series D Preferred
Stock represented by a certificate are redeemed, a new certificate
representing the unredeemed shares of Series D Preferred Stock shall
promptly be issued to such holder.
(d) RIGHTS SUBSEQUENT TO MANDATORY REDEMPTION. If the Mandatory
Redemption Notice shall have been duly given, and if on the applicable
Mandatory Redemption Date the Mandatory Redemption Price payable upon
redemption of the shares of Series D Preferred Stock to be redeemed on
such Mandatory Redemption Date is paid or tendered for payment, then
notwithstanding that the certificates evidencing any of the shares of
Series D Preferred Stock so called for redemption shall not have been
surrendered, dividends with respect to such shares of Preferred Stock
shall cease to accumulate after such Mandatory Redemption Date and all
rights with respect to such shares shall forthwith after the Mandatory
Redemption Date terminate, except only the right of the holders to receive
the Mandatory Redemption Price without interest upon surrender of their
certificate or certificates therefor.
(e) REDEEMED OR OTHERWISE ACQUIRED SHARES. Any shares of Series D
Preferred Stock that are redeemed pursuant to this Section 5 or Section 6
below or otherwise acquired by the Corporation or any of its subsidiaries
shall be automatically and immediately canceled and shall not be reissued,
sold or transferred as shares of Series D Preferred Stock. Neither the
Corporation nor any of its subsidiaries may exercise any voting or other
rights granted to the holders of Series D Preferred Stock following any
redemption.
(f) OTHER REDEMPTIONS OR ACQUISITIONS. Neither the Corporation nor
any subsidiary shall redeem or otherwise acquire any series of Series D
Preferred Stock, except (i) as expressly authorized herein, (ii) with the
written consent of the holders of at least a majority of the
then-outstanding shares of (A) Series D-1 Preferred Stock and (B) Series
D-2 Preferred Stock, or (iii) pursuant to a purchase offer made pro rata
to all holders of Series D Preferred Stock on the basis of the number of
shares of Series D Preferred Stock owned by each such holder.
6. REDEMPTION AT THE OPTION OF THE HOLDERS OF SERIES D PREFERRED STOCK
(a) RIGHT TO REDEEM. Shares of Series D-1 Preferred Stock shall be
redeemed by the Corporation at a price per share equal to the Stated Value
plus accumulated but unpaid dividends (the "Optional Redemption Price") at
any time and from time to time no earlier than the sixth anniversary of
the Series D Original Issue Date after receipt by the Corporation from the
holders of at least a majority of the then-outstanding shares of Series
D-1 Preferred Stock of written notice (a "Series D-1 Optional Redemption
Notice") requesting redemption of all or any portion of the outstanding
shares of Series D-1 Preferred Stock. Shares of Series D-2 Preferred Stock
shall be redeemed by the Corporation at a price per share equal to the
Optional Redemption Price at any time
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and from time to time no earlier than the sixth anniversary of the Series
D Original Issue Date after receipt by the Corporation from holder(s)
holding in the aggregate shares of Series D-2 Preferred Stock then
outstanding with a Stated Value in excess of $3,000,000 (or if less than
$3,000,000, all of such holder's shares of Series D-2 Preferred Stock) of
written notice (a "Series D-2 Optional Redemption Notice" and together
with a Series D-1 Optional Redemption Notice, an "Optional Redemption
Notice") requesting redemption of all or any portion of such holder's
outstanding shares of Series D-2 Preferred Stock. Notwithstanding any
other provision of this Section 6, until the seventh anniversary of the
Series D Original Issue Date, the aggregate number of shares of (i) Series
D-1 Preferred Stock or (ii) Series D-2 Preferred Stock that the
Corporation may be required to redeem under this Section 6 shall not
exceed 50% of the number of shares of Series D-1 Preferred Stock or Series
D-2 Preferred Stock, respectively, outstanding as of the sixth anniversary
of the Series D Original Issue Date. The process for effecting any such
redemption shall be as follows:
(i) Within 15 days after the receipt of an Optional Redemption
Notice, the Corporation shall send to each holder of Series D
Preferred Stock a notice (the "Corporation Notice") which shall (A)
state the number of shares of Series D Preferred Stock that are the
subject of the applicable Optional Redemption Notice, and (B) specify
a date (an "Optional Redemption Date") as of which a redemption
pursuant to this Section 6 shall be effected and the date by which a
holder may elect to join in the redemption pursuant to subsection
(b)(ii) below. Each Optional Redemption Date shall be a Trading Day
not less than 40 days or more than 120 days following the date on
which the related Corporation Notice is sent by the Corporation.
(ii) Within 20 days after receipt of the Corporation Notice,
each holder of Series D Preferred Stock may provide notice to the
Corporation that such holder wishes to include all or a portion of its
shares of Series D Preferred Stock in such Optional Redemption Notice
and stating the number of shares to be so included (and, thereafter
such shares shall be deemed to be included in such Optional Redemption
Notice).
(iii) Within 50 days after receiving the Optional Redemption
Notice and at least 10 days prior to the Optional Redemption Date, the
Corporation shall provide each holder of Series D Preferred Shares
with written notice ("Closing Notice") that states (i) the applicable
Optional Redemption Price, (ii) the applicable Optional Redemption
Date, (iii) the number of shares requested to be redeemed on that
Optional Redemption Date, (iv) the number of shares of Series D
Preferred Stock to be redeemed on such date, and (v) that the holder
is to surrender to the Corporation, in the manner and at the place
designated, its certificate or certificates (or affidavit of loss and
indemnity agreement) representing the shares of Series D Preferred
Stock to be redeemed.
(iv) Subject to the limitations above in this Section 6, on the
applicable Optional Redemption Date, the Corporation shall redeem, on
a pro rata basis in accordance with the number of shares of Series D
Preferred Stock owned by each holder for which redemption was
requested, that number of outstanding shares of Series D Preferred
Stock specified or deemed to be included in the Optional Redemption
Notice. In the event the Corporation does not have sufficient funds
legally available to redeem on such Optional Redemption Date all
shares of Series D Preferred Stock to be redeemed on such Optional
Redemption Date, the Corporation shall redeem a pro rata portion of
each holder's shares out of funds legally available therefor, based on
the respective amounts that would otherwise be payable in respect of
the shares to be redeemed if the legally available funds were
sufficient to redeem all such shares, and shall redeem the remaining
shares to have been redeemed as soon as practicable after the
Corporation has funds legally available therefor. If the Corporation
has not redeemed all
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outstanding shares of Series D Preferred Stock which are to be
redeemed within 120 days following the date on which the related
Optional Redemption Notice is sent by the Corporation, the Dividend
Rate with regard to any shares of Series D Preferred Stock that remain
outstanding shall be 14% per annum from the date of the Optional
Redemption Notice until such date as such shares are actually
redeemed.
(b) OPTIONAL REDEMPTION NOTICE AND OTHER NOTICES. Any Optional
Redemption Notice shall be delivered to the Corporation, and any
Corporation Notice or Closing Notice shall be delivered to each holder of
record of Series D Preferred Stock, as applicable, in accordance with the
notice provisions set forth in Section 13 below.
(c) SURRENDER OF CERTIFICATES; PAYMENT. On or before the applicable
Optional Redemption Date, each holder of shares of Series D Preferred
Stock to be redeemed on such Optional Redemption Date, unless such holder
has exercised its right to convert such shares as provided in Section 4
above, shall surrender the certificate or certificates (or deliver an
affidavit of loss and indemnity agreement for such certificates)
representing such shares to the Corporation, in the manner and at the
place designated by the Corporation in its notice pursuant to this Section
6, and thereupon the Optional Redemption Price for such shares shall be
payable to the order of the person whose name appears on such certificate
or certificates as the owner thereof, and each surrendered certificate
shall be canceled and retired. In the event less than all of the shares of
Series D Preferred Stock represented by a certificate are redeemed, a new
certificate representing the unredeemed shares of Series D Preferred Stock
shall promptly be issued to such holder.
(d) RIGHTS SUBSEQUENT TO OPTIONAL REDEMPTION. If the Optional
Redemption Notice shall have been duly given, and if on the applicable
Optional Redemption Date the Optional Redemption Price payable upon
redemption of the shares of Series D Preferred Stock to be redeemed on
such Optional Redemption Date is paid or tendered for payment, then
notwithstanding that the certificates evidencing any of the shares of
Series D Preferred Stock so called for redemption shall not have been
surrendered, dividends with respect to such shares of Preferred Stock
shall cease to accumulate after such Optional Redemption Date and all
rights with respect to such shares shall forthwith after the Optional
Redemption Date terminate, except only the right of the holders to receive
the Optional Redemption Price without interest upon surrender of their
certificate or certificates therefor.
7. WAIVERS
The holders of Series D Preferred Stock shall also be entitled to, and
shall not be deemed to have waived, any other applicable rights granted to such
holders under the Delaware General Corporation Law. Any of the rights of the
holders of Series D-1 Preferred Stock or Series D-2 Preferred Stock set forth
herein may be waived by the affirmative consent or vote of the holders of at
least a majority of the then outstanding shares of Series D-1 Preferred Stock or
Series D-2 Preferred Stock, respectively, subject to applicable law.
8. NO IMPAIRMENT
The Corporation will not, by amendment of its Certificate of Incorporation
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms to be observed
or performed hereunder by the Corporation without the written consent of the
holders of at least a majority of the then-outstanding shares of Series D
Preferred Stock, but will at all times in good faith assist in the carrying out
of all the provisions of this Certificate of Designations and in the taking of
all such action as may be necessary or appropriate in order to protect the
rights of the holders of the Series D
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Preferred Stock against impairment.
9. REGISTRATION OF SERIES D PREFERRED STOCK
The Corporation shall register shares of the Series D Preferred Stock,
upon records to be maintained by the Corporation for that purpose (the "Series D
Preferred Stock Register"), in the name of the record holders thereof from time
to time. The Corporation may deem and treat the registered holder of shares of
Series D Preferred Stock as the absolute owner thereof for the purpose of any
conversion hereof or any distribution to such holder, and for all other
purposes, absent actual notice to the contrary.
10. REGISTRATION OF TRANSFERS
The Corporation shall register the transfer of any shares of Series D
Preferred Stock in the Series D Preferred Stock Register, upon surrender of
certificates evidencing such Shares to the Corporation at its address specified
herein. Upon any such registration or transfer, a new certificate evidencing the
shares of Series D Preferred Stock so transferred shall be issued to the
transferee and a new certificate evidencing the remaining portion of the shares
not so transferred, if any, shall be issued to the transferring holder.
11. REPLACEMENT CERTIFICATES
If any certificate evidencing Series D Preferred Stock, or Common Stock
issued upon conversion thereof, is mutilated, lost, stolen or destroyed, the
Corporation shall issue or cause to be issued in exchange and substitution for
and upon cancellation hereof, or in lieu of and substitution for such
certificate, a new certificate, but only upon receipt of an affidavit of loss
and indemnity agreement reasonably satisfactory to the Corporation evidencing
such loss, theft or destruction and customary and reasonable indemnity, if
requested. Applicants for a new certificate under such circumstances shall also
comply with such other reasonable regulations and procedures and pay such other
reasonable third-party costs as the Corporation may prescribe.
12. LIMITATION ON CONVERSION
(a) Notwithstanding anything to the contrary contained herein, the
number of shares of Common Stock that may be acquired by any holder of
Series D-2 Preferred Stock upon any conversion of Series D-2 Preferred
Stock (or otherwise in respect of the Series D-2 Preferred Stock) shall be
limited to the extent necessary to insure that, following such conversion
(or other issuance), the total number of shares of Common Stock then
beneficially owned by such holder and its affiliates and any other persons
whose beneficial ownership of Common Stock would be aggregated with such
holder's for purposes of Section 13(d) of the Exchange Act, does not
exceed 4.999% (the "Maximum Percentage") of the total number of issued and
outstanding shares of Common Stock (including for such purpose the shares
of Common Stock issuable upon such conversion). Each delivery of a
Conversion Notice by a holder of Series D-2 Preferred Stock will
constitute a representation by such holder that it has evaluated the
limitation set forth in this paragraph and determined that issuance of the
full number of shares of Common Stock requested in such Conversion Notice
is permitted under this paragraph. By written notice to the Corporation,
any holder of Series D-2 Preferred Stock may waive the provisions of this
Section or increase or decrease the Maximum Percentage to any other
percentage specified in such notice, but (i) any such waiver or increase
will not be effective until the 61st day after such notice is delivered to
the Corporation, and (ii) any such waiver or increase or decrease will
apply only to such holder and not to any other holder of Series D-2
Preferred Stock. For purposes of this Section 12, beneficial ownership
shall be determined in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder.
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(b) For purposes of this Section 12, in determining the number of
outstanding shares of Common Stock, a holder of Series D Preferred Stock
may rely on the number of outstanding shares of Common Stock as reflected
in (1) the Corporation's most recent Form 10-Q, Form 10-K or other public
filing with the Commission, as the case may be, (2) a more recent public
announcement by the Corporation, or (3) any other notice by the
Corporation or its transfer agent setting forth the number of shares of
Common Stock outstanding. Upon the written request of any holder of Series
D Preferred Stock, the Corporation shall promptly, but in no even later
than one Trading Day following the receipt of such notice, confirm in
writing to any such holder the number of shares of Common Stock then
outstanding.
13. NOTICES
Any and all notices or other communications or deliveries hereunder
(including without limitation any Conversion Notice) shall be in writing and
shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section prior to 5:30 p.m. (New York City
time) on a Trading Day and electronic confirmation of receipt is received by the
sender, (ii) the next Trading Day after the date of transmission, if such notice
or communication is delivered via facsimile at the facsimile number specified in
this Section on a day that is not a Trading Day or later than 5:30 p.m. (New
York City time) on any Trading Day, (iii) the Trading Day following the date of
mailing, if sent by nationally recognized overnight courier service, or (iv)
upon actual receipt by the party to whom such notice is required to be given.
The addresses for such communications shall be: (i) if to the Corporation, to 10
Canal Park, Cambridge, Massachusetts 02141, facsimile: (617) 949-1722,
attention: Chief Executive Officer and General Counsel, or (ii) if to a holder
of Series D Preferred Stock, to the address or facsimile number appearing on the
Corporation's stockholder records or such other address or facsimile number as
such holder may provide to the Corporation in accordance with this Section.
14. PREEMPTIVE RIGHTS
Each holder of the Series D Preferred Stock shall have preemptive rights,
the terms of which are specified in the Investor Rights Agreement among the
Corporation and the holders of Series D Preferred Stock dated ___________, 2003
(as amended from time to time in accordance with its terms, and subject to the
limitations and other terms set forth in such Investor Rights Agreement,
including the right to waive any term thereof).
* * *
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designations to be signed by its President as of _________, 2003.
ASPEN TECHNOLOGY, INC.
By:
----------------------------------------
President and Chief Executive Officer
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