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Delaware
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001-16381
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76-0600966
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(State
or other jurisdiction of incorporation or organization)
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(Commission
File Number)
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(IRS
Employer Identification Number)
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Exhibit
Number
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Description
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3.1
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Amendment
to Designation of the Series A Convertible Preferred Stock filed November
24, 2008.
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3.2
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Amendment
to Designation of the Series C Convertible Preferred Stock filed November
24, 2008.
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8. Conversion Provisions.
(c)
Conversion Ratio. The Conversion
Ratio shall be subject to adjustment as follows:
(i)
In case the Company shall (A) pay a dividend or make a distribution in
Common Stock, (B) subdivide or reclassify its outstanding shares of Common
Stock into a greater number of shares, or (c) reclassification or
combination into a smaller number of shares, the Conversion Ratio in
effect immediately prior thereto shall be adjusted retroactively as
provided below so that the Conversion Ratio thereafter shall be by
multiplying the Conversion Ratio at which such shares of this Series were
theretofore convertible by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding immediately following such
action and of which the denominator shall be the number of shares of
Common Stock outstanding immediately prior thereto. Such adjustment shall
be made whenever any event listed above shall occur and shall become
effective retroactively immediately after the record date in the case of a
dividend and shall become effective immediately after the effective date
in the case of a subdivision or
reclassification.
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7. CONVERSION. The holders of the
Series C Preferred Stock shall have conversion rights as
follows:
(a) Conversion
Ratio. The holder of each share of Series C Preferred
Stock shall have the right (the “Conversion Right”), at such holder’s
option, to convert such share, without cost, on the terms and at the times
specified in this Section 7, into the number of fully paid and
non-assessable shares of Common Stock as specified by the Conversion Ratio
that is in effect at the time of conversion; provided that, and only to
the extent that, the Corporation has a sufficient number of shares of
authorized but unissued and unreserved Common Stock available to issue
upon conversion of all outstanding shares of Series C Preferred
Stock. The initial “Conversion Ratio” for the Series C
Preferred Stock is 350:1. The Conversion Ratio shall be subject
to adjustment from time to time as provided in this Section
7.
(b) Shares Eligible for
Conversion. The below specified number of shares of
Series C Preferred Stock shall be eligible for conversion during each
successive 90 days, commencing 90 days after the effective date of an
increase in the number of authorized but unissued shares of Common Stock
sufficient to issue upon conversion of all outstanding shares of Series C
Preferred Stock.
The
number of Series C Preferred Shares eligible for conversion during each 90
day period is 10% (ten percent) of the original number of shares of Series
C Preferred Stock issued to each original holder (“Eligible
Shares”). Any Eligible Shares not converted during any 90 day
period may not be cumulated and carried forward to the next 90 day
period. Any subsequent owner or holder of all or any part of
Series C Preferred Stock shall be subject to the same eligibility
provisions applicable to the original holder of such shares.
(c) Mechanics of
Conversion. A holder of any share of Series C Preferred
Stock may exercise the Conversion Right of such share by surrendering the
certificate therefor, duly endorsed, at the office of the Corporation or
of any transfer agent for the Series C Preferred Stock, together with a
written notice to the Corporation which shall state: (A) that such holder
elects to convert the same, (B) the number of shares issued to the
original holder of such shares; and (C) the number of Eligible Shares and
the number of shares of Series C Preferred Stock being
converted. Thereupon the Corporation shall promptly issue and
deliver to the holder of such shares a certificate or certificates for the
number of whole shares of Common Stock to which such holder shall be
entitled. 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 fair market value (as determined in good
faith by the Board of Directors of the Corporation) of the Common
Stock. If the certificate evidencing the Series C Preferred
Stock being converted shall also evidence shares of Series C Preferred
Stock not being converted, then the Corporation shall also deliver to the
holder of such certificate a new stock certificate evidencing the Series C
Preferred Stock not converted. The conversion of any shares of
Series C Preferred Stock shall be deemed to have been made immediately
prior to the close of business on the date that the shares of Series C
Preferred Stock to be converted are surrendered to the Corporation, 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 on such
date. Any dividends or distributions declared but unpaid at the
time of conversion with respect to the Series C Preferred Stock so
converted, including any dividends declared on the Common Stock to which
the Series C Preferred Stock is entitled pursuant to Section 6 above,
shall be paid to the holder of Common Stock issued upon conversion of the
Series C Preferred Stock upon the payment date therefore.
The Corporation shall give
written notice to each holder of a share of Series C Preferred Stock
promptly upon the liquidation, dissolution or winding up of the
Corporation, and not more than fifty (50) nor less than twenty (20) days
before the anticipated date of consummation of any acquisition of the
Corporation or any sale of all or substantially all of the assets of the
Corporation and no such acquisition of the Corporation or sale of assets
shall be effective until such notice shall have been
given.
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