EXHIBIT 99.9
CERTIFICATE OF AMENDMENT TO
CERTIFICATE OF INCORPORATION OF
CYTATION CORPORATION
CERTIFICATE OF DESIGNATION,
PREFERENCES AND RIGHTS
OF
SERIES C CONVERTIBLE PREFERRED STOCK
Cytation Corporation, a corporation organized and existing under the laws
of the State of Delaware (the "CORPORATION"), hereby certifies that the Board of
Directors of the Corporation (the "BOARD OF DIRECTORS" or the "BOARD"), pursuant
to authority of the Board of Directors as required by applicable corporate law,
and in accordance with the provisions of its Certificate of Incorporation and
Bylaws, has and hereby authorizes a series of the Corporation's previously
authorized Preferred Stock, par value $.01 per share (the "PREFERRED STOCK"),
and hereby states the designation and number of shares, and fixes the rights,
preferences, privileges, powers and restrictions thereof, as follows:
SERIES C CONVERTIBLE PREFERRED STOCK DESIGNATION AND AMOUNT
26,750 shares of the authorized and unissued Preferred Stock of the
Corporation are hereby designated "SERIES C CONVERTIBLE PREFERRED STOCK" with
the following rights, preferences, powers, privileges, restrictions,
qualifications and limitations.
1. Intentionally Omitted.
2. Voting.
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a. Number of Votes. On any matter presented to the stockholders
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of the Corporation for their action or consideration at any meeting of
stockholders of the Corporation (or by written consent of stockholders in lieu
of meeting), each holder of outstanding shares of Series C Convertible Preferred
Stock shall be entitled, subject to the limitation set forth in Section 2(b)
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below, to cast the number of votes equal to the number of whole shares of Common
Stock into which the shares of Series C Convertible Preferred Stock held by such
holder are convertible as of the record date for determining stockholders
entitled to vote on such matter. Except as provided by law or by the provisions
of Section 2(c) below, holders of Series C Convertible Preferred Stock shall
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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, together as a
single class.
b. Limitation on Number of Votes. Notwithstanding anything
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contained herein to the contrary, the voting rights of each holder of
outstanding shares of Series C Convertible Preferred Stock shall be limited in
accordance with Section 6 hereof, so that each holder of Series C Convertible
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Preferred Stock shall be entitled to vote only the number of votes equal to the
number of whole shares of Common Stock into which the shares of Series C
Convertible Preferred Stock are convertible as of the record date, up to a
maximum of 4.99% of the outstanding shares of Common Stock of the Corporation.
c. Limitations on Corporate Action. At any time when shares of
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Series C Convertible Preferred Stock are outstanding, except where the vote or
written consent of the holders of a greater number of shares of the Corporation
is required by law or by this Certificate of Designation, and in addition to any
other vote required by law or this Certificate of Designation, without the
written consent or affirmative vote of the holders of a majority of the
then-outstanding shares of Series C Convertible Preferred Stock given in writing
or by vote at a meeting, consenting or voting (as the case may be) as a separate
class from the Common Stock, the Corporation shall not, either directly or by
amendment, merger, consolidation or otherwise:
(i) increase the authorized number of shares of Series C
Convertible Preferred Stock;
(ii) alter or change the voting or other powers, preferences,
or other rights, privileges or restrictions of the Series C Convertible
Preferred Stock contained herein (by merger, consolidation or otherwise);
(iii) make or authorize, or permit the authorization of, any
material change in the nature or scope of the business of the Corporation; or
(iv) cause or authorize, or permit any of its subsidiaries to
authorize or take any of the foregoing actions. For purposes of this Section
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2(c)(iv), "SUBSIDIARY" means any entity of which securities or ownership
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interests having voting power to elect a majority of the board of directors or
other persons performing similar functions or otherwise granting the holder
Control are directly or indirectly beneficially owned by the Corporation. For
purposes of this Certificate of Designation, "CONTROL" means the possession,
directly or indirectly, of power to direct or cause the direction of management
or policies (whether through ownership of voting securities, by agreement or
otherwise).
3. Dividends.
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a. Amount. From and after the date of the issuance of any shares
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of Series C Convertible Preferred Stock, each holder of Series C Convertible
Preferred Stock shall receive, in the case of a dividend on Common Stock or any
class or series that is convertible into Common Stock, that dividend per share
of Series C Convertible Preferred Stock as would equal the product of (1) the
dividend payable on each share of such class or series determined, if
applicable, as if all such shares of such class or series had been converted
into Common Stock and all Series C Convertible Preferred Stock had been
converted into Common Stock, and (2) the number of shares of Common Stock
issuable upon conversion of a share of Series C Convertible Preferred Stock,
calculated on the record date for determination of holders entitled to receive
such dividend.
b. Cumulative Dividends on Series C Convertible Preferred Stock.
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Dividends declared or paid for shares of Series C Convertible Preferred Stock
shall not be cumulative.
4. Liquidation, Dissolution, or Winding-Up; Certain Mergers,
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Consolidations and Asset Sales.
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a. Payments to Holders of Series C Convertible Preferred Stock.
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In the event of any voluntary or involuntary liquidation, dissolution, or
winding up of the Corporation, the holders of shares of Series C Convertible
Preferred Stock then outstanding shall be entitled to be paid out of the assets
available for distribution to its stockholders after the Aggregate Series A
Liquidation Preference Payment (as defined in the Certificate of Designations,
Preferences, and Rights of Series A Convertible Preferred Stock of the
Corporation (the "SERIES A PREFERRED STOCK CERTIFICATE OF DESIGNATIONS")) shall
be made to the holders of shares of the Corporation's Series A Convertible
Preferred Stock (the "SERIES A PREFERRED STOCK") and before any payment shall be
made to the holders of Common Stock or any other class or series of stock
ranking on liquidation junior to the Series C Convertible Preferred Stock (such
Common Stock and other stock being collectively referred to as "JUNIOR STOCK")
by reason of their ownership thereof, an amount equal to One Hundred Thousand
and No/100 Dollars ($100,000)(the amount payable pursuant to this sentence is
hereinafter referred to as the "SERIES C LIQUIDATION AMOUNT"). If, upon any
such liquidation, dissolution, or winding up of the Corporation (and after the
entire Aggregate Series A Liquidation Preference Payment has been paid to the
holders of shares of Series A Preferred Stock) the remaining assets available
for distribution to its stockholders shall be insufficient to pay the holders of
shares of Series C Convertible Preferred Stock and any class or series of stock
ranking on liquidation on a parity with the Series C Convertible Preferred
Stock, the full preferential amount to which they shall be entitled, the holders
of shares of Series C Convertible Preferred Stock and any class or series of
stock ranking on liquidation on a parity with the Series C Convertible Preferred
Stock, which shall include the Series B Convertible Preferred Stock of the
Company (the "SERIES B PREFERRED"), shall share ratably in any distribution of
the remaining assets available for distribution 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.
b. Payments to Holders of Junior Stock. Upon any liquidation,
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dissolution or winding up of the Corporation, immediately after (1) the holders
of Series A Preferred Stock have been paid in full the Aggregate Series A
Liquidation Preference Payment, as set forth in the Series A Preferred Stock
Certificate of Designations; and (2) the holders of Series B Preferred Stock
have been paid in full the Series B Liquidation Amount, as set forth in the
Series B Preferred Stock Certificate of Designations and the holders of Series C
Convertible Preferred Stock have been paid in full the Series C Liquidation
Amount pursuant to Section 4(a) above, the remaining net assets of the
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Corporation available for distribution shall be distributed pro-rata among the
holders of shares of Series B Preferred Stock, Series C Convertible Preferred
Stock, and Common Stock on an as-converted-to-Common Stock basis.
c. Deemed Liquidation Events.
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(i) The following events shall be deemed to be a liquidation
of the Corporation for purposes of this Section 4 (a "DEEMED LIQUIDATION
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EVENT"), unless the holders of a majority of the shares of Series C Convertible
Preferred Stock elect otherwise by written notice given to the Corporation at
least five (5) days prior to the effective date of any such event:
A. a merger or consolidation 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 that any such merger or consolidation involving the Corporation or a
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subsidiary in which the shares of capital stock of the Corporation outstanding
immediately prior to such merger or consolidation continue to represent, or are
converted or exchanged for shares of capital stock that represent, immediately
following such merger or consolidation, at least a majority, by voting power, 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 (provided that, for the
purpose of this Section4(c)(i), all shares of Common Stock issuable upon
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exercise of options outstanding immediately prior to such merger or
consolidation, or upon conversion of convertible securities outstanding
immediately prior to such merger or consolidation shall be deemed to be
outstanding immediately prior to such merger or consolidation and, if
applicable, converted or exchanged in such merger or consolidation on the same
terms as the actual outstanding shares of Common Stock are converted or
exchanged); or
B. the sale, lease, transfer, or other disposition, in a
single transaction or series of related transactions, by the Corporation or any
subsidiary of the Corporation of all or substantially all of the assets of the
Corporation and its subsidiaries, taken as a whole, except where such sale,
lease, transfer, or other disposition is to a wholly-owned subsidiary of the
Corporation.
(ii) The Corporation shall not have the power to effect any
transaction constituting a Deemed Liquidation Event pursuant to Section
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4(c)(i)(A)(I) above unless the agreement or plan of merger or consolidation
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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 Sections 4(a) and 4(b) above.
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(iii) In the event of a Deemed Liquidation Event pursuant to
Section 4(c)(i)(A)(II) or (B) above, if the Corporation does not effect a
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dissolution of the Corporation under the Delaware General Corporation Law within
sixty (60) days after such Deemed Liquidation Event, then (A) the Corporation
shall deliver a written notice to each holder of Series C Convertible Preferred
Stock no later than the 60th day 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
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redemption of such shares of Series C Convertible Preferred Stock; and (B) if
the holders of at least a majority of the then-outstanding shares of Series C
Convertible Preferred Stock so request in a written instrument delivered to the
Corporation not later than seventy-five (75) days after such Deemed Liquidation
Event, the Corporation shall use the consideration received by the Corporation
for such Deemed Liquidation Event (net of any retained liabilities associated
with the assets sold or technology licensed, as determined in good faith by the
Board of Directors)(the "NET PROCEEDS") to redeem, to the extent legally
available therefor, on the 90th day after such Deemed Liquidation Event (the
"LIQUIDATION REDEMPTION DATE"), all outstanding shares of Series C Convertible
Preferred Stock at a price per share equal to the Series C 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 C
Convertible Preferred Stock, or if the Proceeds are not sufficient to redeem all
outstanding shares of Series C Convertible Preferred Stock, or if the
Corporation does not have sufficient funds lawfully available to effect such
redemption, the Corporation shall redeem a pro rata portion of each holder's
shares of Series C Convertible Preferred Stock to the fullest extent of such Net
Proceeds or such lawfully available funds, as the case may be, and, where such
redemption is limited by the amount of lawfully available funds, the Corporation
shall redeem the remaining shares to have been redeemed as soon as practicable
after the Corporation has funds legally available therefor. Prior to the
distribution or redemption provided for in this Section 4(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) Whenever the distribution provided for in this Section 4
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shall be payable in property other than cash, the value of such distribution
shall be the fair market value of such property, rights or securities as
determined in good faith by the Board of Directors of the Corporation.
5. Optional Conversion. The holders of Series C Convertible Preferred
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Shares shall have the conversion rights as follows (the "CONVERSION RIGHTS").
a. Right to Convert. Each share of Series C Convertible Preferred
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Stock shall be convertible, at the option of the holder thereof and subject to
the conversion cap set forth in Section 6 below, at any time after the
"CONVERSION DATE" (as defined in Section 9 below), and without the payment of
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additional consideration by the holder thereof, into One Hundred (100) shares of
Common Stock.
b. Fractional Shares. No fractional shares of Common Stock shall
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be issued upon conversion of the Series C Convertible Preferred Stock. 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 fair market
value of a share of Common Stock as determined in good faith by the Board of
Directors, or round-up to the next whole number of shares, at the Corporation's
option. Whether or not fractional shares would be issuable upon such conversion
shall be determined on the basis of the total number of shares of Series C
Convertible Preferred Stock the holder is at the time converting into Common
Stock and the aggregate number of shares of Common Stock issuable upon such
conversion.
c. Mechanics of Conversion.
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(i) For a holder of Series C Convertible Preferred Stock to
voluntarily convert shares of Series C Convertible Preferred Stock into shares
of Common Stock, that holder shall surrender the certificate or certificates for
such shares of Series C Convertible Preferred Stock (or, if the registered
holder alleges that such certificate has been lost, stolen, or destroyed, a lost
certificate affidavit and agreement reasonably acceptable to the Corporation to
indemnify the Corporation against any claim that may be made against the
Corporation on account of the alleged loss, theft, or destruction of such
certificate), at the office of the transfer agent for the Series C Convertible
Preferred Stock (or at the principal office of the Corporation if the
Corporation serves as its own transfer agent), together with written notice that
the holder elects to convert all or any number of the shares of the Series C
Convertible Preferred Stock represented by such certificate or certificates and,
if applicable, any event on which such conversion is contingent. The notice
shall state the holder's name or the names of the nominees in which the holder
wishes the certificate or certificates for shares of Common Stock to be issued.
If required by the Corporation, certificates surrendered for conversion shall be
endorsed or accompanied by a written instrument or instruments of transfer, in
form satisfactory to the Corporation, duly executed by the registered holder or
his, her, or its attorney duly authorized in writing. The close of business on
the date of receipt by the transfer agent of such certificates (or lost
certificate affidavit and agreement) and notice (or by the Corporation if the
Corporation serves as its own transfer agent) shall be the time of conversion
(the "CONVERSION TIME"), and the shares of Common Stock issuable upon conversion
of the shares represented by such certificate shall be deemed to be outstanding
of record as of that date. The Corporation shall, as soon as practicable after
the Conversion Time, issue and deliver at such office to the holder of Series C
Convertible Preferred Stock, or to his, her, or its nominee(s), a certificate or
certificates for the number of shares of Common Stock to which the holder(s)
shall be entitled, together with cash in lieu of any fraction of a share, if
applicable.
(ii) All shares of Series C Convertible 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, to vote, and to receive payment of any
dividends accrued or declared but unpaid thereon, shall immediately cease and
terminate at the Conversion Time, except only the right of the holders thereof
to receive shares of Common Stock in exchange therefor. Any shares of Series C
Convertible Preferred Stock so converted shall be retired and cancelled and
shall not be reissued as shares of such series, and the Corporation (without the
need for stockholder action) may from time to time take such appropriate action
as may be necessary to reduce the authorized number of shares of Series C
Convertible Preferred Stock accordingly.
(iii) 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 C Convertible
Preferred Stock pursuant to this Section 5. The Corporation shall not, however,
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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 C Convertible 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 satisfaction
of the Corporation, that such tax has been paid.
d. Adjustments for Other Dividends and Distributions. If the
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Corporation at any time or from time to time after the Series C Original Issue
Date shall make or issue, or fix a record date for the determination of holders
of capital stock of the Corporation entitled to receive, a dividend or other
distribution payable in securities of the Corporation (other than a distribution
of shares of Common Stock in respect of outstanding shares of Common Stock) or
in other property, then, and in each such event, the holders of Series C
Convertible Preferred Stock shall receive, simultaneously with the distribution
to the holders of such capital stock, a dividend or other distribution of such
securities or other property in an amount equal to the amount of such securities
or other property as they would have received if all outstanding shares of
Series C Convertible Preferred Stock had been converted into Common Stock on the
date of such event.
e. Adjustment for Merger or Reorganization, etc. Subject to the
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provisions of Section 4(c) above, if there shall occur any reorganization,
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recapitalization, reclassification, consolidation or merger involving the
Corporation in which the Common Stock (but not the Series C Convertible
Preferred Stock) is converted into or exchanged for securities, cash, or other
property (other than a transaction covered by Section 5(d) above), then,
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following any such reorganization, recapitalization, reclassification,
consolidation, or merger, each share of Series C Convertible Preferred Stock
shall thereafter be convertible in lieu of the Common Stock into which it was
convertible prior to such event 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 C Convertible
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) shall be made in the
application of the provisions in this Section 5 with respect to the rights and
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interests thereafter of the holders of the Series C Convertible Preferred Stock,
to the end that the provisions set forth in this Section 5 shall thereafter be
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applicable, as nearly as reasonably may be, in relation to any securities or
other property thereafter deliverable upon the conversion of the Series C
Convertible Preferred Stock.
f. Notice of Record Date. In the event:
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(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 C Convertible 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, or any Deemed Liquidation Event; or
(iii) of the voluntary or involuntary dissolution, liquidation,
or winding-up of the Corporation, then, and in each such case, the Corporation
will send or cause to be sent to the holders of the Series C Convertible
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 proposed to take place, and the time, if any is to
be fixed, as of which the holders of record of Common Stock (or such other stock
or securities at the time issuable upon the conversion of the Series C
Convertible 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, and the amount per
share and character of such exchange applicable to the Series C Convertible
Preferred Stock and the Common Stock. Such notice shall be sent at least ten
(10) days prior to the record date or effective date for the event specified in
such notice. Any notice required by the provisions hereof to be given to a
holder of shares of Series C Convertible Preferred Stock shall be deemed sent to
such holder if deposited in the United States mail, postage prepaid, and
addressed to such holder at his, her, or its address appearing on the books of
the Corporation.
6. Conversion Cap. In no event shall any holder be entitled to convert
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any Series C Convertible Preferred Stock to the extent that, after such
conversion, the sum of the number of shares of Common Stock beneficially owned
by any holder and its affiliates (other than shares of Common Stock which may be
deemed beneficially owned through the ownership of the unconverted portion of
the Series C Convertible Preferred Stock or any unexercised right held by any
holder subject to a similar limitation), would result in beneficial ownership by
any holder and its affiliates of more than 4.99% of the outstanding shares of
Common Stock (after taking into account the shares to be issued to the holder
upon such conversion). For purposes of this Section 6, beneficial ownership
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shall be determined in accordance with Section 13(d) of the Securities Exchange
Act of 1934, as amended. Nothing herein shall preclude the holder from
disposing of a sufficient number of other shares of Common Stock beneficially
owned by the holder so as to thereafter permit the continued conversion of the
Series C Convertible Preferred Stock.
7. Redemption. Except as set forth in Section 4(c)(iii), there
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shall be no redemption of shares of Series C Convertible Preferred Stock.
8. Waiver. Any of the rights, powers, or preferences of the holders of
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Series C Convertible Preferred Stock set forth herein may be waived by the
affirmative consent or vote of the holders of at least a majority of the shares
of Series C Convertible Preferred Stock then outstanding.
9. Definitions. As used herein, the following terms shall have the
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following meanings:
a. "CONVERSION DATE" shall mean the date that the Company effects
an increase in the authorized shares of Common Stock of the Corporation.
IN WITNESS WHEREOF, this Certificate of Designation has been executed by a
duly authorized officer of the Corporation on this ____ day of January __, 2006.
CYTATION CORPORATION
By: /s/ Charles G. Masters
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Charles G. Masters, Chief Executive Officer
[Signature Page to Series C Preferred Certificate of Designations]