EXHIBIT 99.8
CERTIFICATE OF AMENDMENT TO
CERTIFICATE OF INCORPORATION OF
CYTATION CORPORATION
CERTIFICATE OF DESIGNATION,
PREFERENCES AND RIGHTS
OF
SERIES B 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 B CONVERTIBLE PREFERRED STOCK DESIGNATION AND AMOUNT
49,451 shares of the authorized and unissued Preferred Stock of the
Corporation are hereby designated "SERIES B 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 B Convertible Preferred
Stock shall be entitled to cast the number of votes equal to the number of whole
shares of Common Stock into which the shares of Series B 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(b) below, holders of Series B Convertible Preferred
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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, together
as a single class.
b. Limitations on Corporate Action. At any time when shares of
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Series B 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 B 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 B
Convertible Preferred Stock;
(ii) alter or change the voting or other powers, preferences,
or other rights, privileges or restrictions of the Series B 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(b)(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 B Convertible Preferred Stock, each holder of Series B 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 B 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 B 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 B Convertible Preferred Stock,
calculated on the record date for determination of holders entitled to receive
such dividend.
b. Cumulative Dividends on Series B Convertible Preferred Stock.
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Dividends declared or paid for shares of Series B 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 B 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 B 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 B 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 B 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 B Convertible Preferred Stock and any class or series of stock
ranking on liquidation on a parity with the Series B Convertible Preferred
Stock, the full preferential amount to which they shall be entitled, the holders
of shares of Series B Convertible Preferred Stock and any class or series of
stock ranking on liquidation on a parity with the Series B Convertible Preferred
Stock, which shall include the Series C Convertible Preferred Stock of the
Company (the "SERIES C PREFERRED STOCK"), 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 Convertible
Preferred Stock have been paid in full the Series B Liquidation Amount pursuant
to Section 4(a) above, and the holders of Series C Preferred Stock have been
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paid in full the Series C Liquidation Amount, as set forth in the Series C
Preferred Stock Certificate of Designations, the remaining net assets of the
Corporation available for distribution shall be distributed pro-rata among the
holders of shares of Series B Convertible Preferred Stock, Series C 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 B 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 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 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.
(iii) In the event of a Deemed Liquidation Event pursuant to Section
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4(c)(i)(A)(II) or (B) above, if the Corporation does not effect a dissolution of
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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 B 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 redemption of such shares
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of Series B Convertible Preferred Stock; and (B) if the holders of at least a
majority of the then-outstanding shares of Series B 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 B Convertible Preferred
Stock at a price per share equal to the Series B 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 B Convertible
Preferred Stock, or if the Proceeds are not sufficient to redeem all outstanding
shares of Series B 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 B
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
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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 shall be
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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. Mandatory Conversion.
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a. Contemporaneously with the completion of the increase in
authorized shares of Common Stock of the Corporation (the "MANDATORY CONVERSION
DATE") in connection with that certain Securities Purchase and Share Exchange
Agreement, of even date herewith, by and among Cytation Corporation, certain
shareholders of Cytation a party thereto, DeerValley Acquistions, Corp. ("DVA"),
DVA shareholders a party thereto, Vicis Capital Master Fund, and certain
purchasers of Series A Convertible Preferred Stock a party thereto, (i) each
outstanding share of Series B Convertible Preferred Stock shall automatically be
converted into one hundred (100) shares of Common Stock, and (ii) the shares of
Series B Convertible Preferred Stock may not be reissued by the Corporation as
shares of such series or any other series of Preferred Stock.
b. All holders of record of shares of Series B Convertible
Preferred Stock shall be given written notice of the Mandatory Conversion Date
and the place designated for mandatory conversion of all such shares of Series B
Convertible Preferred Stock pursuant to this Section5. Such notice need not be
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given in advance of the occurrence of the Mandatory Conversion Date. Such
notice shall be sent by first class or registered mail, postage prepaid, or
given by electronic communication in compliance with the provisions of Delaware
corporate law, to each record holder of Series B Convertible Preferred Stock.
Upon receipt of such notice, each holder of shares of Series B Convertible
Preferred Stock shall surrender his, her or its certificate(s) for all such
shares to the Corporation at the place designated in such notice, and shall
thereunder receive certificates for the number of shares of Common Stock to
which such holder is entitled pursuant to Section5(a). On the Mandatory
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Conversion Date, all outstanding shares of Series B Convertible Preferred Stock
shall be deemed to have been converted into shares of Common Stock, which shall
be deemed to be outstanding of record, and all rights with respect to the Series
B Convertible Preferred Stock so converted, including the rights, if any, to
receive notices and to vote (other than as a holder of Common Stock), will
terminate, except the right of the holders thereof, upon surrender of their
certificate(s) therefor, to receive certificates for the number of shares of
Common Stock into which such Series B Convertible Preferred Stock has been
converted, and payment of any declared but unpaid dividends thereon. If so
required by the Corporation, certificates surrendered for conversion shall be
endorsed or accompanied by written instrument(s) of transfer, in form
satisfactory to the Corporation, duly executed by the registered holder or by
his, her or its attorney duly authorized in writing. As soon as practicable
after the Mandatory Conversion Date and the surrender of the certificate(s) for
Series B Convertible Preferred Stock, the Corporation shall cause to be issued
and delivered to such holder, on his, her or its written order, a certificate or
certificates for the number of full shares of Common Stock issuable on such
Conversion in accordance with the provisions hereof.
c. All certificates evidencing shares of Series B Convertible
Preferred Stock that are required to be surrendered for conversion in accordance
with the provisions hereof shall, from and after the Mandatory Conversion Date,
be deemed to have been retired and cancelled and the shares of Series B
Convertible Preferred Stock represented thereby converted into Common Stock for
all purposes, notwithstanding the failure of the holder(s) thereof to surrender
such certificate(s) on or prior to such date. Such converted Series B
Convertible Preferred Stock may not be reissued as shares of such Series or any
other series of Preferred Stock, and the Corporation may thereafter take such
appropriate action (without the need for stockholder action) as may be necessary
to reduce the authorized number of shares of Series B Convertible Preferred
Stock accordingly.
6. Optional Conversion. The holders of the Series B Convertible
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Preferred Stock shall have no optional conversion rights.
7. Redemption. There shall be no redemption of shares of Series B
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Convertible Preferred Stock.
8. Waiver. Any of the rights, powers, or preferences of the holders of
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Series B 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 B Convertible Preferred Stock then outstanding.
[Signature Page Follows]
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 B Preferred Certificate of Designations]