AMENDED AND RESTATED
CERTIFICATE OF DESIGNATIONS
OF SERIES A CONVERTIBLE PREFERRED STOCK
OF
RAND LOGISTICS, INC.
RAND LOGISTICS, INC., a corporation organized and existing under the
General Corporation Law of the State of Delaware (the "Corporation"), DOES
HEREBY CERTIFY THAT:
Pursuant to authority conferred upon the Corporation's Board of Directors
(the "Board") by Article FOURTH of the Certificate of Incorporation of the
Corporation (the "Certificate of Incorporation") and pursuant to the provisions
of ss.151 of the Delaware General Corporation Law, the Board adopted and
approved the following resolution providing for the designations, preferences
and other rights, and the qualifications, limitations and restrictions of the
Series A Convertible Preferred Stock.
WHEREAS, the Certificate of Incorporation provides for two classes
of shares known as common stock, $0.0001 par value per share (the "Common
Stock"), and preferred stock, $0.0001 par value per share (the "Preferred
Stock"); and
WHEREAS, the Board is authorized by the Certificate of Incorporation
to provide for the issuance of the shares of Preferred Stock in series, and by
filing a certificate pursuant to the applicable law of the State of Delaware, to
establish from time to time the number of shares to be included in such series
and to fix the designations, preferences and rights of the shares of each such
series and the qualifications, limitations and restrictions thereof.
NOW, THEREFORE, BE IT RESOLVED, that the Board deems it advisable
to, and hereby does, designate a Series A Convertible Preferred Stock and fixes
and determines the preferences, rights, qualifications, limitations and
restrictions relating to the Series A Convertible Preferred Stock as follows:
1. Designation. The shares of such series of Preferred Stock shall
be designated "Series A Convertible Preferred Stock" (referred to herein as the
"Series A Stock").
2. Authorized Number. The number of shares constituting the Series A
Stock shall be 300,000.
3. Ranking. The Series A Stock shall rank, as to dividends and upon
Liquidation (as defined in Section 5(a) hereof), senior and prior to the Common
Stock and to all other classes or series of stock issued by the Corporation. All
equity securities of the Corporation to which the Series A Stock ranks prior,
with respect to dividends and upon Liquidation, including, without limitation,
the Common Stock, are collectively referred to herein as "Junior Securities."
4. Dividends.
(a) Dividend Accrual and Payment. (i) The holders of the
Series A Stock shall be entitled to receive, when and if declared by the board,
out of funds legally available for the payment therefor, cash dividends per
share equal to the product of (x) the Dividend Rate (as defined below) and (y)
the Series A Base Price (as defined below) (hereinafter referred to as
"Dividends"). Dividends shall be payable quarterly on the first day immediately
following the end of the Corporation's fiscal quarter, or, if any such date is a
Saturday, Sunday or legal holiday, then on the next day which is not a Saturday,
Sunday or legal holiday (each a "Dividend Payment Date") and to the extent not
paid, shall accrue.
(ii) The "Series A Base Price" means, for each share of
Series A Stock, the sum of (x) the Series A Issue Price (as defined below) of
such share and (y) any Accrued Dividends (as defined below) with respect to such
share.
(iii) The "Series A Issue Price" of each share of Series
A Stock means $50.00 (as adjusted for any combinations, divisions or similar
recapitalizations affecting the shares of Series A Stock).
(iv) "Accrued Dividends" means, with respect to each
share of Series A Stock, any accrued and unpaid Dividends on such share.
(v) "Dividend Rate" means the rate of 7.75% per annum,
provided, however, that in the event that Dividends shall have accrued but
remain unpaid for two consecutive fiscal quarters, the Dividend Rate shall, as
of the end of such two-fiscal quarter period, prospectively increase by 0.5% per
annum, and the Dividend Rate shall further increase prospectively by 0.5% per
annum as of the end of each subsequent two-fiscal quarter period with respect to
which Dividends shall have accrued but remain unpaid, provided, further,
however, that under no circumstances shall the Dividend Rate exceed 12% per
annum, and provided, further, however, that upon payment by the Corporation of
all Accrued Dividends, the Dividend Rate shall thereupon automatically be
reduced prospectively to 7.75% per annum, subject to successive increases and
reductions as provided hereby.
(vi) If any shares of Series A Stock are issued on a
date which does not coincide with a Dividend Payment Date, then the initial
Dividend accrual period applicable to such shares shall be the period from the
date of issuance thereof (the "Original Issue Date") through the last day of the
Corporation's fiscal quarter in which such shares are issued. If the date fixed
for redemption of or payment of a final liquidating distribution on any shares
of Series A Stock, or the date on which any shares of Series A Stock are
converted into Common Stock, does not coincide with a Dividend Payment Date,
then subject to the provisions hereof relating to such redemption, payment or
conversion, the final Dividend accrual period applicable to such shares shall be
the period from the first day of the Corporation's fiscal quarter during which
such redemption, payment or conversion occurs through the redemption, payment or
conversion date.
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(b) Dividend Limitation on Junior Securities. For so long as
any Dividends shall have accrued but remain unpaid, the Corporation shall not
declare, pay or set apart for payment, any dividend on any Junior Securities, or
make any distribution in respect thereof, either directly or indirectly, and
whether in cash, obligations or shares of the Corporation or other property.
5. Liquidation.
(a) Liquidation Procedure. Upon any liquidation, dissolution
or winding up of the Corporation, whether voluntary or involuntary (a
"Liquidation"), the holders of the shares of Series A Stock shall be entitled,
before any distribution or payment is made upon any Junior Securities, to be
paid an amount per share equal to the sum of (i) the Series A Issue Price and
(ii) any Accrued Dividends with respect to such share through the date of
Liquidation (such sum, the "Liquidation Preference"). If upon Liquidation, the
assets to be distributed among the holders of Series A Stock shall be
insufficient to permit payment in full to the holders of Series A Stock of the
Liquidation Preference, then the entire assets of the Corporation shall be
distributed ratably among such holders in proportion to the full respective
Liquidation Preference to which they are entitled.
(b) Remaining Assets. Upon Liquidation, after the holders of
Series A Stock shall have been paid in full the Liquidation Preference, the
remaining assets of the Corporation legally available for distribution shall be
distributed ratably among the holders of the Junior Securities then outstanding,
or in accordance with any priorities or other terms of such Junior Securities.
(c) Mergers, Reorganizations, Etc. The merger, reorganization
or consolidation of the Corporation into or with another corporation or other
similar transaction or series of related transactions, or the sale of all or
substantially all the assets of the Corporation (the foregoing being referred to
collectively as an "Acquisition") shall not be considered a Liquidation.
6. Conversion. The Series A Stock shall be convertible into shares
of Common Stock of the Corporation in accordance with the following terms:
(a) Right to Convert.
(i) By the Holders of the Series A Stock. Each share of
Series A Stock shall be convertible, at the option of the holder thereof,
at any time after the Original Issue Date to and including the Cash
Redemption Date, at the office of the Corporation or its transfer agent,
into that number of the fully paid and nonassessable shares of Common
Stock determined in accordance with the provisions of Section 6(b) below.
In order to convert shares of the Series A Stock into shares of Common
Stock, the holder thereof shall surrender the certificate or certificates
therefor, duly endorsed, at the office of the Corporation or its transfer
agent, together with written notice to the Corporation stating that it
elects to convert the same and setting forth the name or names it wishes
the certificate or certificates for Common Stock to be issued, and the
number of shares of Series A Stock being converted. Such conversion shall
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be deemed to have been made immediately prior to the close of business on
the date of such surrender of the shares of Series A Stock to be
converted, and the person or persons entitled to receive the shares of
Common Stock issuable upon such conversion shall be treated for all
purposes as the record holder or holders of such shares of Common Stock at
such date and shall, with respect to such shares, have only those rights
of a holder of Common Stock of the Corporation.
(ii) By the Corporation. If at any time after the third
anniversary of the Original Issue Date, the Market Price (as defined
below) on the OTC Bulletin Board (or on a national securities market on
which the Common Stock is quoted for trading) of the Common Stock for 20
trading days within any 30 trading day period ending on the third business
day prior to the date on which notice of the Company Conversion is given
equals or exceeds $8.50 per share (subject to adjustment in the event of
stock splits, reverse stock splits, stock dividends, recapitalizations or
similar events) (the "Conversion Threshold"), the Corporation shall have
the right, at its option, and without any action on the part of the
holders of the Series A Stock, to convert each share of Series A Stock
into that number of the fully paid and nonassessable shares of Common
Stock determined in accordance with the provisions of Section 6(b) below,
by delivery of written notice of such conversion to the holders of the
Series A Stock (the "Company Conversion"). The Company Conversion shall be
deemed to occur on the date set forth in such notice, which shall be no
less than three and no more than ten business days after the date of such
notice, and the person or persons entitled to receive the shares of Common
Stock issuable upon such conversion shall be treated for all purposes as
the record holder or holders of such shares of Common Stock at such date
and shall, with respect to such shares, have only those rights of a holder
of Common Stock of the Corporation. The Conversion Threshold shall be
adjusted in accordance with Section 6(d) in the event of a subdivision of
the Common Stock or a dividend in Common Stock or other securities
convertible into or exchangeable for Common Stock, and in the event of a
Reorganization (as defined below), appropriate adjustment shall be made in
the Conversion Threshold such that the Conversion Threshold thereafter
shall be applicable, as nearly as reasonably may be, in relation to any
shares, other securities or property thereafter receivable upon conversion
of the Series A Stock.
(b) Conversion of the Series A Stock; Accrued Dividends.
(i) Each share of Series A Stock converted by the holder
thereof pursuant to Section 6(a)(i) or by the Corporation pursuant to Section
6(a)(ii) shall be converted into the number of fully paid and nonassessable
shares of Common Stock equal to the quotient of (x) the Series A Issue Price
divided by (y) the Conversion Price (as defined below). No shares of Common
Stock shall be issued on account of Accrued Dividends with respect to shares of
Series A Stock being converted (and the holder of such converted shares of
Series A Stock shall have no further right thereto or interest therein), and in
lieu thereof, the Corporation shall issue to the holder of such converted shares
of Series A Stock a subordinated promissory note, in substantially the form of
Exhibit A hereto, with a principal amount equal to the amount of such Accrued
Dividends as of the date of such conversion.
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(ii) No fractional shares of Common Stock shall be
issued upon conversion of the Series A Stock. All shares of Common Stock
issuable upon conversion of more than one share of Series A Stock of a holder
shall be aggregated for purposes of determining whether the conversion would
result in the issuance of any fractional share. If, after the aforementioned
aggregation, the conversion would result in the issuance of any fractional
share, the Corporation shall, in lieu of issuing any fractional share, pay cash
equal to the product of such fraction multiplied by the Market Price on the date
of conversion.
(iii) The Corporation shall, as soon as practicable
after the surrender of the certificate or certificates evidencing shares of
Series A Stock for conversion at the office of the Corporation or its transfer
agent, issue to each holder of such shares, or its nominee or nominees, a
certificate or certificates evidencing the number of shares of Common Stock to
which it shall be entitled and, in the event that only a part of the shares
evidenced by such certificate or certificates are converted, a certificate
evidencing the number of shares of Series A Stock which are not converted.
(iv) "Market Price" for any day means, with respect to
the shares of Common Stock, the last sale price as reported by Bloomberg (or if
such information is not available from Bloomberg, from another nationally
recognized independent pricing source) for such day. If there is no publicly
traded market for the shares of Common Stock, pricing information will be
obtained directly from broker/dealers and active market makers such as banks and
securities firms. In instances where there is no readily available pricing
information, the Board shall determine in good faith the fair value of the
Common Stock, which determination shall be set forth in a certificate by the
Secretary of the Corporation.
(c) Conversion Price. The conversion price per share for the
Series A Stock shall initially be $6.20 (the "Conversion Price") and shall be
subject to adjustment from time to time as provided herein.
(d) Adjustment for Stock Splits and Combinations. If
outstanding shares of the Common Stock of the Corporation shall be subdivided
into a greater number of shares, or a dividend in Common Stock or other
securities of the Corporation convertible into or exchangeable for Common Stock
(in which latter event the number of shares of Common Stock issuable upon the
conversion or exchange of such securities shall be deemed to have been
distributed) shall be paid in respect to the Common Stock of the Corporation,
the Conversion Price in effect immediately prior to such subdivision or at the
record date of such dividend shall, simultaneously with the effectiveness of
such subdivision or immediately after the record date of such dividend, be
proportionately reduced, and conversely, if outstanding shares of the Common
Stock of the Corporation shall be combined into a smaller number of shares, the
Conversion Price in effect immediately prior to such combination shall
simultaneously with the effectiveness of such combination, be proportionately
increased.
(e) Reorganizations, Mergers, Consolidations or
Reclassifications. In the event of any capital reorganization, any
reclassification of the Common Stock (other than a change in par value), or the
consolidation or merger of the Corporation with or into another Person
(collectively referred to hereinafter as "Reorganizations"), upon conversion of
the Series A Stock, the holders of the Series A Stock shall thereafter be
entitled to receive, and provision shall be made therefor in any agreement
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relating to a Reorganization, the kind and number of shares of Common Stock or
other securities or property (including cash) of the Corporation, or other
corporation resulting from such consolidation or surviving such merger, which
would have been due in connection with such Reorganization to a holder of the
number of shares of the Common Stock of the Corporation to which the Series A
Stock entitled the holder thereof to convert; and in any such case appropriate
adjustment shall be made in the application of the provisions herein set forth
with respect to the rights and interests thereafter of the holders of the Series
A Stock, to the end that the provisions set forth herein (including the
specified changes and other adjustments to the Conversion Price) shall
thereafter be applicable, as nearly as reasonably may be, in relation to any
shares, other securities or property thereafter receivable upon conversion of
the Series A Stock. The provisions of this Section 6(e) shall similarly apply to
successive Reorganizations.
(f) Sale of Additional Shares.
(i) If at any time or from time to time the Corporation
shall issue or sell Additional Shares of Common Stock (as hereinafter defined),
or is deemed by the express provisions of this subsection (f) to issue or sell
Additional Shares of Common Stock, other than as a subdivision or combination of
shares of Common Stock as provided in Section 6(d) above, for a consideration
per share less than the then existing Conversion Price, then the then existing
Conversion Price shall be reduced, as of the opening of business on the date of
such issuance or sale, to a price determined by dividing (A) an amount equal to
the sum of (1) the applicable Conversion Price immediately prior to such
issuance or sale multiplied by the number of shares of Common Stock deemed
outstanding at the close of business on the day before the date of such issuance
or sale, plus (2) the aggregate consideration, if any, received or to be
received by the Corporation upon such issuance or sale, by (B) an amount equal
to the sum of (1) the number of shares of Common Stock deemed outstanding
immediately prior to such issuance or sale, plus (2) the total number of
Additional Shares of Common Stock so issued. For the purposes of the preceding
sentence, the number of shares of Common Stock deemed to be outstanding as of a
given date shall be the sum of (i) the number of shares of Common Stock actually
outstanding, and (ii) the number of shares of Common Stock into which the then
outstanding shares of Series A Stock could be converted if fully converted on
the day immediately preceding the given date.
(ii) For the purpose of making any adjustment in the
Conversion Price or number of shares of Common Stock issuable upon conversion of
the Series A Stock, as provided above, the following provisions shall be
applicable:
(A) In case of the issuance of Common Stock for
consideration in whole or in part for cash, the consideration shall be
deemed to be the amount of cash paid therefor, plus the value of any
property other than cash received by the Corporation as determined in
accordance with clause (B) below.
(B) In case of the issuance of Common Stock for
consideration in whole or in part in property or consideration other than
cash, the value of such property or consideration other than cash shall be
deemed to be the fair value thereof as determined in good faith by the
Board.
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(C) In case of the issuance of (x) options, warrants, or
other rights to acquire or to purchase or to subscribe for Common Stock
(whether or not at the time exercisable), (y) securities convertible into
or exchangeable for Common Stock or (z) options to purchase or rights to
subscribe for such convertible or exchangeable securities (whether or not
at the time so convertible or exchangeable): (1) the aggregate maximum
number of shares of Common Stock deliverable upon exercise of such
options, warrants, or other rights to acquire or to purchase, or to
subscribe for Common Stock (whether or not at the time exercisable) shall
be deemed to have been issued at the time such options or rights were
issued and for a consideration equal to the consideration (determined in
the manner provided in clauses (A) and (B) above), if any, received by the
Corporation upon the issuance of such options, warrants or rights plus the
purchase or exercise price provided in such options, warrants or rights
for the shares of Common Stock covered thereby; (2) the aggregate maximum
number of shares of Common Stock deliverable upon conversion of, or in
exchange for, any such convertible or exchangeable securities or upon the
exercise of options to purchase, or to subscribe for, such convertible or
exchangeable securities and subsequent conversion or exchange thereof
shall be deemed to have been issued at the time such securities were
issued or such options, warrants or rights were issued and for a
consideration equal to the consideration received by the Corporation for
any such securities and related options or rights, plus the additional
consideration, if any, to be received by the Corporation upon the
conversion or exchange of such securities or the exercise of any related
options, warrants or rights (determined in the manner provided in clauses
(A) and (B) above); and (3) on the expiration of any warrant, right or
option or on the termination of any right to convert or exchange any
convertible or exchangeable securities, (whether or not at the time so
convertible or exchangeable), the Conversion Price then in effect shall
thereupon be readjusted to the Conversion Price as would have been in
effect had the adjustment made upon the granting or issuance of such
warrants, rights or options or convertible or exchangeable securities
(whether or not at the time so convertible or exchangeable) been made upon
the basis of the issuance or sale of only the number of shares of Common
Stock actually issued upon the exercise of such options, warrants or
rights or upon the conversion or exchange of such convertible or
exchangeable securities. No readjustment pursuant to clause (3) above
shall have the effect of increasing the Conversion Price to an amount
which exceeds the lower of (x) the Conversion Price on the original
adjustment date or (y) the Conversion Price that would have resulted from
any issuance of Additional Shares of Common Stock between the original
adjustment date and such readjustment date.
(g) Additional Shares of Common Stock. "Additional Shares of
Common Stock" shall mean all shares of Common Stock issued or deemed to be
issued or issuable by the Corporation, whether or not subsequently reacquired or
retired by the Corporation, other than (i) shares of Common Stock issued upon
the conversion of the Series A Stock, (ii) shares of Common Stock issued in
connection with any stock split, stock dividend or recapitalization of the
Corporation, (iii) shares of Common Stock issuable upon the exercise of stock
options or settlement of other awards made under any compensatory or incentive
stock, bonus, option or similar plan for the benefit of the officers, directors
or employees of the Company or its subsidiaries in effect or adopted as of or
after the Original Issue Date with respect to, in the aggregate, no more than
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ten percent (10%) of the Common Stock issued and outstanding on the Original
Issue Date, as adjusted for stock splits, reverse stock splits, stock dividends,
recapitalizations or similar events, (iv) shares of Common Stock issued upon
settlement of awards under the Rand Management Bonus Program adopted as of the
Original Issue Date, (v) shares of Common Stock issuable upon (a) exercise of
any warrants to purchase Common Stock issued in the Corporation's initial public
offering, (b) exercise of options to purchase "Units" of Common Stock and
warrants to purchase Common Stock issued in connection with the Corporation's
initial public offering to the underwriter(s) thereof or any representatives of
such underwriters, and (c) exercise of the warrants included in the "Units"
referred to in clause (b) above (such warrants, referred to in clauses (a) and
(c) above, "IPO Warrants"), (vi) shares of Common Stock issued pursuant to an
acquisition of a business (including, without limitation, by way of an
acquisition of capital stock) or the assets of a business (which assets do not
consist primarily of cash or cash equivalents) approved by the Board, (vii) the
2,402,957 shares of Common Stock issued pursuant to the Stock Purchase
Agreement, effective as of August 1, 2006, between the Corporation and the
"Buyers" thereunder and (viii) shares of Common Stock issuable upon exercise of
up to 1,000,000 warrants to purchase Common Stock (having substantially
identical terms as the warrants included in the "Units" issued in the
Corporation's initial public offering) which are issued, in the aggregate, to
the Corporation's Chief Executive Officer, President and non-management board of
director members (in such amounts as shall be determined by the Corporation) in
lieu of cash compensation which would otherwise be paid to such individuals.
(h) Certificate of Adjustment. In each case of an adjustment
or readjustment of the Conversion Price or the number of shares of Common Stock
or other securities issuable upon conversion of the Series A Stock, the
Corporation, at its expense, shall cause the Chief Financial Officer of the
Corporation to compute such adjustment or readjustment in accordance with this
Certificate of Designations and prepare a certificate showing such adjustment or
readjustment, and shall mail such certificate, by first-class mail, postage
prepaid, to each registered holder of the Series A Stock at the holder's address
as shown on the Corporation's stock transfer books. The certificate shall set
forth such adjustment or readjustment, showing in detail the facts upon which
such adjustment or readjustment is based, including a statement of (i) the
consideration received or to be received by the Corporation for any Additional
Shares of Common Stock issued or sold or deemed to have been issued or sold,
(ii) the Conversion Price at the time in effect for the Series A Stock, and
(iii) the number of Additional Shares of Common Stock and the type and amount,
if any, of other property which at the time would be received upon conversion of
the Series A Stock.
(i) Reservation of Stock Issuable Upon Conversion. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of effecting the
conversion of the shares of Series A Stock, such number of its shares of Common
Stock as shall from time to time be sufficient to effect a conversion of all
outstanding shares of the Series A Stock, and if at any time the number of
authorized but unissued shares of Common Stock shall not be sufficient to effect
the conversion of all then outstanding shares of the Series A Stock, the
Corporation shall promptly seek such corporate action as may, in the opinion of
its counsel, be necessary to increase its authorized but unissued shares of
Common Stock to such number of shares as shall be sufficient for such purpose.
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(j) Payment of Taxes. The Corporation shall pay all taxes and
other governmental charges (other than any income or other taxes imposed upon
the profits realized by the recipient) that may be imposed in respect of the
issue or delivery of shares of Common Stock or other securities or property upon
conversion of shares of Series A Stock; provided that, the Corporation shall not
pay any taxes or other governmental charge, imposed in connection with any
transfer involved in the issue and delivery of shares of Common Stock or other
securities in a name other than that of which the shares of Series A Stock so
converted were registered.
(k) Minimum Adjustment. No adjustment of the Conversion Price
shall be made if the amount of any such adjustment would be an amount less than
one percent (1%) of the Conversion Price then in effect, but any such amount
shall be carried forward and an adjustment in respect thereof shall be made at
the time of and together with any subsequent adjustment which, together with
such amount and any other amount or amounts so carried forward, shall aggregate
an increase or decrease of one percent (1%) or more.
(l) Certain Adjustments. The Conversion Price shall not be
adjusted upward except in the event of a combination of the outstanding shares
of Common Stock into a smaller number of shares of Common Stock or in the event
of a readjustment of the Conversion Price pursuant to Section 6(f)(ii)(C)(3).
(m) No Impairment, other actions. The Corporation will not, by
amendment of its Certificate of Incorporation (including this Certificate of
Designations) or through any reorganization, recapitalization 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, but will at
all times in good faith assist in the carrying out of all the provisions of this
Certificate of Designations in the taking of all such action as may be necessary
or appropriate in order to protect the rights of the holders of Series A
Preferred Stock, including the conversion rights of the holders of Series A
Preferred Stock, against impairment. If the Corporation shall take any action
affecting the outstanding number of shares of Common Stock other than an action
described herein, which would have an inequitable effect on the holders of the
Series A Preferred Stock, then the Conversion Price shall be adjusted in such
manner and at such times as the Board on the advice of the Corporation's
independent public accountants may in good faith determine to be equitable in
the circumstances.
7. Redemption.
(a) (i) Cash Redemption. Concurrently with (i) the
consummation of a merger, reorganization or consolidation of the Corporation
into or with another corporation (A) immediately following which the holders of
Common Stock immediately prior to the consummation of such merger,
reorganization or consolidation do not hold 50% or more of the voting securities
of the surviving entity or (B) in which more than 50% of the voting power of the
Corporation is disposed of in exchange for property, rights or securities
distributed to the holders thereof by the acquiring person, firm or entity, (ii)
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a similar transaction or series of transactions which has the effect referred to
in clause (A) or (B) above, or (iii) the consummation of a sale of all or
substantially all the assets of the Corporation (any such transaction referred
to in (i), (ii) or (iii), a "Change of Control", and the date of the
consummation of any Change of Control, the "Cash Redemption Date"), each share
of Series A Stock shall be automatically (and without further action by the
Board or the holders of the Series A Stock) redeemed by the Corporation at a
price per share equal to the sum of (x) one hundred and five percent (105%) of
the Series A Issue Price and (y) any Accrued Dividends with respect to such
share through the Cash Redemption Date (such sum, the "Cash Redemption Price").
(ii) Redemption Procedure. On or prior to the Cash
Redemption Date, the Corporation shall deposit an amount equal to the aggregate
Cash Redemption Price with a bank or trust corporation reasonably acceptable to
the Board as a trust fund for the benefit of the holders of the shares of Series
A Stock, with irrevocable instructions and authority to the bank or trust
corporation to pay the Cash Redemption Price for such shares to such holders on
or after the Cash Redemption Date upon receipt of the certificate or
certificates of the shares of Series A Stock to be redeemed. From and after the
Cash Redemption Date, unless there shall have been a default in payment of the
Cash Redemption Price, all rights of the holders of shares of Series A Stock as
holders of Series A Stock (except the right to receive the Redemption Price upon
surrender of their certificate or certificates) shall cease as to those shares
of Series A Stock redeemed, and such shares shall not thereafter be transferred
on the books of the Corporation or be deemed to be outstanding for any purpose
whatsoever. If on the Cash Redemption Date the funds of the Corporation legally
available for redemption of shares of Series A Stock are insufficient to redeem
the total number of shares of Series A Stock to be redeemed on such date, then
the Corporation will use those funds which are legally available therefor to
redeem the maximum possible number of shares of Series A Stock ratably among the
holders of such shares to be redeemed based upon their holdings of Series A
Stock. Payments shall first be applied against Accrued Dividends and thereafter
against the remainder of the Cash Redemption Price. The shares of Series A Stock
not redeemed shall remain outstanding and entitled to all the rights and
preferences provided herein. At any time thereafter when additional funds of the
Corporation are legally available for the redemption of shares of Series A Stock
such funds will immediately be used to redeem the balance of the shares of
Series A Stock. No dividends or other distributions shall be declared or paid
on, nor shall the Corporation redeem, purchase or acquire any shares of, the
Common Stock or any other class or series of stock of the Corporation unless the
Cash Redemption Price of all shares shall have been paid in full. Until the Cash
Redemption Price for each share of Series A Stock elected to be redeemed shall
have been paid in full, such share of Series A Stock shall remain outstanding
for all purposes and entitle the holder thereof to all the rights and privileges
provided herein, including, without limitation, that Dividends thereon shall
continue to accrue and, if unpaid prior to the date such shares are redeemed,
shall be included as part of the Cash Redemption Price as provided in this
Section 7(a)(ii).
(iii) Notice of Change of Control. The Corporation shall
deliver written notice of a contemplated Change of Control to the holders of
Series A Stock not less than ten (10) business days prior to a prospective Cash
Redemption Date. Such notice shall contain a description of the material terms
of the proposed Change of Control and may be satisfied by delivery to the
holders of Series A Stock of any proxy statement or other notice delivered to
the holders of Common Stock in connection with such Change of Control. Any
notice of conversion delivered by a holder of Series A Stock pursuant to Section
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4(a)(i) after the delivery of a notice of a Change of Control and before or on
the Cash Redemption Date specified in such notice of Change of Control may, at
the option of such holder of Series A Stock, specify that the conversion
election specified therein is subject to, and conditioned upon, consummation of
the Change of Control described in such notice, and any such conditional
conversion notice shall be null and void in the event that such Change of
Control is not consummated.
(b) Prohibited Redemption. Except as set forth in this Section
7, the Corporation shall not have the right to redeem any shares of the Series A
Stock.
8. Voting Rights.
(a) General. In addition to those rights set forth in Section
9 herein, each holder of Series A Stock shall have full voting rights and powers
equal to the voting rights and powers of the holders of Common Stock, and shall
be entitled to notice of any stockholders' meeting in accordance with the bylaws
of the Corporation (as in effect at the time in question) and applicable law,
and shall be entitled to vote, together with the holders of Common Stock, with
respect to any question upon which the holders of Common Stock have the right to
vote. In addition to those voting rights of holders of Series A Stock set forth
in Section 9 herein or as required by law, the holders of Series A Stock shall
vote together with the holders of Common Stock and not as separate classes.
(b) Series A Stock. On all matters put to a vote to the
holders of Common Stock, each holder of shares of Series A Stock shall be
entitled to the number of votes equal to the number of shares of Common Stock
into which such shares of Series A Stock could be converted pursuant to the
provisions of Section 6 above at the record date for the determination of the
stockholders entitled to vote or, if no such record date is established, the
date such vote is taken or any written consent of stockholders is solicited.
9. Protective Provisions. For so long as at least 50% of the shares
of Series A Stock remain outstanding, the Corporation will not, without first
obtaining the written consent or affirmative vote of holders of at least
two-thirds of the shares of Series A Stock then outstanding, voting separately
as a class, take any action with respect to any of the matters set forth in
Sections 9(a) through 9(f).
(a) Change the Series A Stock. Amend, alter, repeal, impair or
change, in any material respect, the rights, preferences, powers, privileges,
restrictions, qualifications or limitations of the Series A Stock.
(b) Create New Stock. Authorize, establish, create (by
reclassification or otherwise) or issue any additional series of Preferred Stock
or any other new class or series of equity securities or any securities
convertible into equity securities of the Corporation, in each case which would
have a preference over, or be on a parity with, the Series A Stock with respect
to dividends or upon Liquidation.
(c) Amend Charter or Bylaws. Amend, alter, repeal or waive any
provision of this Certificate of Designations, the Certificate of Incorporation
of the Corporation or bylaws of the Corporation which would adversely affect any
right, preference, privilege or voting power of the Series A Stock or the
holders thereof.
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(d) Purchase of Shares. Purchase, repurchase or redeem shares
of (i) Common Stock or other Junior Securities or (ii) securities or rights of
any kind convertible into or exercisable or exchangeable for Common Stock or
other Junior Securities, except (a) in each case, upon termination of an
employee, in which case the Corporation may purchase, repurchase or redeem such
shares of Common Stock, Junior Securities or securities held by such employee
pursuant to any agreement or plan under which such shares of Common Stock,
Junior Securities or securities were issued and (b) in the case of clause (ii)
above, the IPO Warrants.
(e) Authorized Shares. Increase the authorized number of
shares of Series A Preferred Stock.
(f) Change of Control. Effect, or agree to effect, any
transaction which will result in a Change of Control.
No change of the shares of Series A Preferred Stock, pursuant
to subsection (a) above, authorized by the requisite vote of holders of Series A
Stock pursuant to this Section 9, shall become effective until at least five
business days after notice of such authorization has been delivered to each
holder of Series A Stock.
10. Notices of Record Date. Upon (i) any taking by the Corporation
of a record of the holders of any class of securities (including the Series A
Stock) for the purpose of determining the holders thereof who are entitled to
receive any dividend or other distribution, or (ii) any Acquisition (as defined
in Section 5(c)), or other capital reorganization of the Corporation, any
reclassification or recapitalization of the capital stock of the Corporation,
any merger or consolidation of the Corporation with or into, any other
corporation, or any Liquidation, or any other action of the type or types
requiring an adjustment to the Conversion Price or the number or character of
the Series A Stock as set forth herein or any action described in Section 7
herein, the Corporation shall mail to each holder of Series A Stock at least
thirty (30) days prior to the record date specified therein a notice specifying
(A) the date on which any such record is to be taken for the purpose of such
dividend or distribution and a description of such dividend or distribution, (B)
the date on which any such Acquisition, reorganization, reclassification,
transfer, consolidation, merger, Liquidation, or other action is expected to
become effective, and (C) the date, if any, that is to be fixed as to when the
holders of record of Common Stock (or other securities) shall be entitled to
exchange their shares of Common Stock (or other securities) for securities or
other property deliverable upon such Acquisition, reorganization,
reclassification, transfer, Liquidation, or other action. Such notice shall also
set forth such facts with respect thereto as shall be reasonably necessary to
indicate the effect of such action (to the extent such effect may be known at
the date of such notice) on the Conversion Price and the number, kind, or class
of shares or other securities or property which shall be deliverable upon the
occurrence of such action or deliverable upon the conversion of Series A Stock.
11. No Reissuance of the Preferred Stock. No share or shares of
Series A Stock acquired by the Corporation by reason of purchase, conversion or
otherwise shall be reissued. The Corporation may from time to time to take such
appropriate corporate action as may be necessary to reduce the authorized number
of shares of Series A Stock.
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12. Headings of Subdivisions. The headings of the various
subdivisions hereof are for convenience of reference only and shall not affect
the interpretation of any of the provisions hereof.
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IN WITNESS WHEREOF, the undersigned has executed this Amended and
Restated Certificate of Designations as of this 8th day of August, 2006.
RAND LOGISTICS, INC.
By: /s/ Laurence S. Levy
--------------------------------
Name: Laurence S. Levy
Title: Chief Executive Officer