Attached files
| file | filename |
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| 8-K - International Cellular Accessories | v176997_8k.htm |
| EX-10.1 - International Cellular Accessories | v176997_ex10-1.htm |
| EX-4.1 - International Cellular Accessories | v176997_ex4-1.htm |
| EX-2.1 - International Cellular Accessories | v176997_ex2-1.htm |
Exhibit 3.1
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ROSS
MILLER
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Secretary
of State
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204
North Carson Street, Suite 1
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Carson City, Nevada
89701-4520
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(775) 684
5708
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Website:
www.nvsos.gov
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Certificate
of Amendment
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(PURSUANT
TO NRS 78.385 AND 78.390)
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USE
BLACK INK ONLY - DO NOT HIGHLIGHT
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ABOVE
SPACE IS FOR OFFICE USE ONLY
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Certificate of Amendment to
Articles of Incorporation
For Nevada Profit
Corporations
(Pursuant
to NRS 78.385 and 78.390 - After Issuance of Stock)
1. Name
of corporation:
International
Cellular Accessories
2. The articles have been amended as
follows: (provide article numbers, if available)
The
amendments to Article I and Article IV of the articles of incorporation set
forth in Exhibit A to this Certificate of Amendment are incorporated herein by
reference in their entirety.
3. The
vote by which the stockholders holding shares in the corporation entitling them
to exercise a least a majority of the voting power, or such greater proportion
of the voting power as may be required in the case of a vote by classes or
series, or as may be required by the provisions of the articles of
incorporation* have voted in favor of the amendment
is: 68.3%
4.
Effective date of filing: (optional)
(must not
be later than 90 days after the certificate is filed)
5.
Signature: (required)
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X
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Signature of Officer
Clifford Chapman, President and Chief Executive
Officer
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*If any
proposed amendment would alter or change any prefrence or any relative or other
right given to any class or series of outstanding shares, then the
amendment must be approved by’the vote, in addition to the affirmative vote
otherwise required, of the holders of shares representing a majority of the
voting power of each class or series affected by the amendment regardless to
limitations or restrictions on the voting power thereof.
IMPORTANT: Failure to include
any of the above information and submit with the proper fees may cause this
filing to be rejected.
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This
form must be accompanied by appropriate fees.
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Nevada Secretary of State
Amend Profit-After
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Revised:
3-6-09
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Exhibit
A to Certificate of Amendment
of
International
Cellular Accessories (the “Corporation”)
Article I
of the Articles of Incorporation is hereby amended as follows:
ARTICLE
I
NAME
The name
of the corporation is IMAGE METRICS, INC.
Section
4.01 of Article IV of the Articles of Incorporation is hereby amended to read in
full as follows:
Section
4.01. Number and Class. The total number of shares of all classes of
capital stock which the Corporation shall have the authority to issue is
90,000,000 shares, consisting of (a) 75,000,000 shares of Common Stock, par
value $0.001 per share, and (b) 20,000,000 shares of Preferred Stock, par value
$0.001 per share, of which 15,000,000 shares of such Preferred Stock shall be
designated as Series A Convertible Preferred Stock.
The
powers, preferences and rights of the shares of Common Stock and the shares of
Preferred Stock, including the Series A Convertible Preferred Stock, and the
qualifications, limitations or restrictions thereof are as follows:
A. Common
Stock
1. Dividends. Subject to the preferential rights of the
Preferred Stock, the holders of shares of Common Stock shall be entitled to
receive, when and if declared by the Board of Directors, out of the assets of
the Corporation which are by law available therefor, dividends payable either in
cash, in property, or in shares of Common Stock.
2. Voting Rights. At every annual or special meeting of
stockholders of the Corporation, every holder of Common Stock shall be entitled
to one vote, in person or by proxy, for each share of Common Stock standing in
his name on the books of the Corporation.
3. Dissolution, Liquidation or
Winding-Up. In the event of any
dissolution, liquidation or winding-up of the affairs of the Corporation, after
payment or provision for payment of the debts and other liabilities of the
Corporation, and of the amounts to which the holders of all outstanding shares
of Preferred Stock shall be entitled, the holders of all outstanding shares of
Common Stock shall be entitled to share ratably in the remaining net assets of
the Corporation.
B. Preferred
Stock
1. Issuance in
Series. The shares of Preferred
Stock may be divided into and issued in one or more series, and each series
shall be so designated as to distinguish the shares thereof from the shares of
all other series. All shares of Preferred Stock shall be of equal rank and
identical except to the extent that variations in the relative preferences and
rights enumerated in subparagraphs (a) through (g), inclusive, of Section 2 of
Paragraph A of this Article IV may be fixed and determined by the Board of
Directors between series hereafter established; and each share of a series shall
be identical in all respects with the other shares of such series.
2. Authority of the Board with
Respect to Series. Authority is
hereby expressly granted to the Board of Directors, subject to the provisions of
this Article IV, to divide the shares of Preferred Stock into one or more
series, and with respect to each such series, to fix and determine by resolution
or resolutions providing for the issue of such series the following relative
preferences and rights as to which there may be variations between the series so
established:
(a) The
distinctive designation of such series and the number of shares which shall
constitute such series which number may be increased or decreased (but not
decreased below the number of shares then outstanding) from time to time by like
action of the Board of Directors;
(b) The
annual rate of dividends payable on shares of such series, the conditions, if
any, upon which and the dates when such dividends shall be payable;
(c) The
time or times when and the price or prices at which shares of such series shall
be redeemable;
(d) The
amount payable on shares of such series in the event of any liquidation,
dissolution or winding-up of the affairs of the Corporation;
(e)
If the shares of such series are to be entitled to the benefit of a
sinking or retirement fund to be applied to the purchase or redemption of shares
of such series, the amount of the fund and the manner of its application,
including the price or prices at which the shares may be redeemed or purchased
through the application of the fund;
(f) If
the shares of such series are to be convertible into or exchangeable for shares
of Common Stock or shares of any other series of Preferred Stock, the conversion
price or prices or the rate or rates of exchange and the terms and conditions of
such conversion or exchange;
(g) The
voting rights, if any, of such series; and
(h) Such
other powers, preferences and rights of shares of such series and the
qualifications, limitations or restrictions thereof as the Board of Directors
may deem advisable and as are not inconsistent with the provisions of the
Certificate of Incorporation.
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3. Dividends. The holders of shares of Preferred Stock of
each series shall be entitled to receive, out of the assets of the Corporation
which are by law available for the payment of dividends, cash dividends in such
amounts and payable at such time or times as shall be fixed and determined by
the Board of Directors in any resolution providing for the issuance of any such
series, before any dividends on any class of capital stock of the Corporation
ranking junior to the Preferred Stock (other than dividends payable in shares of
any class of capital stock of the Corporation ranking junior to the Preferred
Stock) may be declared or paid or set apart for payment. The term “class of
capital stock of the Corporation ranking junior to the Preferred Stock” shall
mean the Common Stock and any other class of stock of the Corporation hereafter
authorized which ranks junior to the Preferred Stock as to payment of dividends
or the distribution of assets upon dissolution, liquidation or
winding-up.
4. Redemption. The shares of Preferred Stock of any series
then outstanding shall be redeemable, in whole or in part, at the option of the
Corporation, by resolution of its Board of Directors at such price or prices and
at such time or times as may be fixed and determined by the Board of Directors
in accordance with any resolution providing for the issuance of any such series
of Preferred Stock. In case of redemption of a part only of the shares of
Preferred Stock of any series at the time outstanding, the redemption shall be
pro rata. Subject to the foregoing, the Board of Directors shall have full
authority and power to prescribe the manner in which the drawing by lot or the
pro rata redemption shall be conducted and the terms and conditions upon which
the shares of Preferred Stock shall be redeemed from time to time.
Notice of
every redemption of shares of Preferred Stock shall be given by mailing such
notice, postage prepaid, not less than 20 nor more than 60 days prior to the
date fixed for such redemption to each holder of record of shares so to be
redeemed at his address as the same shall appear on the books of the
Corporation. Each such notice shall specify the date fixed for redemption and
the place where payment of the redemption price is to be made upon surrender for
cancellation of the certificates representing shares called for redemption. Any
notice which was mailed in the manner herein provided shall be conclusively
presumed to be duly given whether or not the holder receives the
notice.
If notice
of redemption shall have been duly given as hereinabove provided, on and after
the date fixed for redemption (unless the Corporation shall default in making
payment of the redemption price), all shares so called for redemption shall no
longer be deemed outstanding and all rights with respect to such shares,
including, but not limited to, the right to receive dividends thereon, shall
cease and terminate, notwithstanding that any certificate for such shares so
called for redemption shall not have been surrendered for cancellation, and the
holders of such shares so called for redemption shall cease to be shareholders
and shall have no interest in or claim against the Corporation except the right
to receive the redemption price of the shares so redeemed, upon surrender of
their certificates for cancellation.
5. Reacquired
Shares. Shares of any series of
Preferred Stock which have been acquired by the Corporation, whether by purchase
or redemption or by their having been converted into or exchanged for other
shares of the Corporation shall upon their acquisition and without any other
action by the Corporation resume the status of authorized but unissued shares of
Preferred Stock and may be reissued as shares of the series of which they were
originally a part or may be issued as shares of a new series or as shares of any
other series.
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6. Voting Rights. Except as otherwise fixed and determined by the
Board of Directors in any resolution providing for the issuance of any series of
Preferred Stock or as required by law, the holders of shares of Preferred Stock
of any such series shall not be entitled to vote at any annual or special
meeting of stockholders of the Corporation.
7. Dissolution, Liquidation or
Winding-Up. In the event of any
dissolution, liquidation or winding-up of the affairs of the Corporation, after
payment or provision for payment of the debts or other liabilities of the
Corporation, the holders of all then outstanding shares of Preferred Stock shall
be entitled to receive, out of the net assets of the Corporation, an amount in
cash for each share equal to the amount fixed and determined by the Board of
Directors in any resolution providing for the issuance of any such series of
Preferred Stock before any distribution is made to the holders of any class of
capital stock of the Corporation ranking junior to the Preferred Stock. If upon
any dissolution, liquidation or winding-up of the affairs of the Corporation,
the net assets available for distribution shall be insufficient to pay the
holders of all outstanding shares of Preferred Stock in full amounts to which
they respectively shall be entitled, the holders of all outstanding shares of
Preferred Stock of all series shall share ratably in any distribution of assets
in proportion to the full amounts which would be payable upon such distribution
if all sums payable were paid in full. Neither the merger nor the consolidation
of the Corporation, nor the sale, lease or conveyance of all or a part of its
assets, shall be deemed to be a liquidation or winding-up of the affairs of the
Corporation within the meaning of this Article IV.
C. Series A Convertible
Preferred Stock
1. Designation and Number of
Shares. There shall be a series of
Preferred Stock that shall be designated as “Series A Convertible
Preferred Stock,” and the number of
shares constituting such series shall be 15,000,000 shares. Such number of
shares may be increased or decreased by resolution of the Board of Directors;
provided, however, that no decrease shall reduce the number of
shares of Series A Convertible Preferred Stock to less than the number of shares
then issued and outstanding plus the number of shares issuable upon exercise of
outstanding rights, options or warrants or upon conversion of outstanding
securities issued by the Corporation.
2. Ranking. The Series A Convertible Preferred Stock shall,
with respect to distribution rights upon the Liquidation (as defined in Section
3 below) of the Corporation, rank (a) subject to clause (b), senior to the
Common Stock, and all other preferred stock of the Corporation, and (b) as
applicable, junior to or on a parity with such preferred stock of the
Corporation the terms of which expressly provide that such preferred stock will
rank senior to or on a parity with the Series A Convertible Preferred
Stock.
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3. Liquidation.
(a) Upon
any liquidation, dissolution or winding-up of the Corporation, whether voluntary
or involuntary (“Liquidation”), the holders of record of the shares of the
Series A Convertible Preferred Stock shall be entitled to receive, immediately
after any distributions required by the Corporation’s Articles of Incorporation
and any certificate(s) of designation, powers, preferences and rights in respect
of any securities of the Corporation having priority over the Series A
Convertible Preferred Stock with respect to the distribution of the assets of
the Corporation upon Liquidation, and before and in preference to any
distribution or payment of assets of the Corporation or the proceeds thereof may
be made or set apart with respect to any securities of the Corporation over
which the Series A Convertible Preferred Stock has priority with respect to the
distribution of the assets of the Corporation upon Liquidation (“Junior
Securities”), an amount in cash with
respect to each share of Series A Convertible Preferred Stock held by such
holders, equal to the $1.00 per share (subject to adjustment in the event of
stock splits, combinations or similar events). If, upon such Liquidation, the
assets of the Corporation available for distribution to the holders of Series A
Convertible Preferred Stock and any securities of the Corporation having equal
priority with the Series A Convertible Preferred Stock with respect to the
distribution of the assets of the Corporation upon Liquidation (“Parity Securities”) shall be insufficient to permit payment in
full to the holders of the Series A Convertible Preferred Stock and Parity
Securities, then the entire assets and funds of the Corporation legally
available for distribution to such holders and the holders of the Parity
Securities then outstanding shall be distributed ratably among the holders of
the Series A Convertible Preferred Stock and Parity Securities based upon the
proportion the total amount distributable on each share upon liquidation bears
to the aggregate amount available for distribution on all shares of the Series A
Convertible Preferred Stock and of such Parity Securities, if any. Except as
otherwise specifically provided, the consolidation or merger of the Corporation
with another person, or the sale, transfer or lease of all or substantially all
of its assets to another person shall not be deemed to be a Liquidation within
the meaning of this Section 3(a).
(b) Upon
the completion of the distributions required by paragraph (a) of this Section 3,
if assets remain in the Corporation, they shall be distributed to holders of
Junior Securities in accordance with the Corporation’s Articles of
Incorporation.
4. Dividends. The Series A Convertible Preferred Stock shall
not be entitled to receive dividends or other distributions from the
Corporation, and no dividends or distributions shall be payable in respect
thereof.
5. Conversion
Rights. Each holder of record of
shares of the Series A Convertible Preferred Stock shall have the right to
convert all or any part of such holder’s shares of Series A Convertible
Preferred Stock into Common Stock, without any further payment therefor, as
follows:
(a) Optional
Conversion. Subject to and upon
compliance with the provisions of this Section 5, the holder of any shares of
Series A Convertible Preferred Stock shall have the right at such holder’s
option, at any time and from time to time, to convert any of such shares of
Series A Convertible Preferred Stock into fully paid and non-assessable shares
of Common Stock. Each share of Series A Convertible Preferred Stock shall
initially be convertible into one share of Common Stock (the “Conversion Rate”), subject to adjustment upon the terms
hereinafter set forth.
(b) Automatic
Conversion. At such time as the
trading volume of the Common Stock is equivalent to or greater than $300,000 in
value per day for 20 out of 30 consecutive trading days, provided the volume
weighted average price of the Common Stock exceeds $1.00 per share each day
during the 30-day period, and a shelf registration statement covering the resale
of the shares underlying the Series A Convertible Preferred Stock has been
declared effective by the U.S. Securities and Exchange Commission and remains
effective with no stop orders in place, all outstanding shares of Series A
Convertible Preferred Stock shall automatically be converted into Common Shares
at the Conversion Rate.
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(c) Mechanics of
Conversion.
(i) Before
any holder of Series A Convertible Preferred Stock shall be entitled to convert
the same into shares of Common Stock, such holder shall surrender the
certificate or certificates therefor, duly endorsed, at the office of the
Corporation or of any transfer agent for the Series A Convertible Preferred
Stock, and shall give written notice to the Corporation at its principal
corporate office, of the election to convert the same and shall state therein
the name or names in which the certificate or certificates for shares of Common
Stock are to be issued. The Corporation shall, as soon as practicable
thereafter, issue and deliver at such office to such holder of Series A
Convertible Preferred Stock, or to the nominee or nominees of such holder, a
certificate or certificates for the number of shares of Common Stock to which
such holder shall be entitled as aforesaid. Conversion shall be deemed to have
been effected on the date when delivery of notice of an election to convert and
certificates for shares is made, and such date is referred to herein as the
“Conversion Date.”
(ii) All
Common Stock which may be issued upon conversion of the Series A Convertible
Preferred Stock will, upon issuance, be duly issued, fully paid and
non-assessable and free from all taxes, liens, and charges with respect to the
issuance thereof. At all times that any shares of Series A Convertible Preferred
Stock are outstanding, the Corporation shall have authorized and shall have
reserved for the purpose of issuance upon such conversion into Common Stock of
all Series A Convertible Preferred Stock, a sufficient number of shares of
Common Stock to provide for the conversion of all outstanding shares of Series A
Convertible Preferred Stock at the then effective Conversion Rate.
(d) Conversion Rate
Adjustments. The Conversion Rate
shall be subject to the adjustment provisions of Section 6 below.
6. Anti-Dilution
Provisions. During the period in
which any shares of Series A Convertible Preferred Stock remain outstanding, the
Conversion Rate in effect at any time and the number and kind of securities
issuable upon the conversion of the Series A Convertible Preferred Stock shall
be subject to adjustment from time to time following the date of the original
issuance of the Series A Convertible Preferred Stock upon the happening of
certain events as follows:
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(a) Consolidation, Merger or
Sale. If any consolidation or merger
of the Corporation with another person, or the sale, transfer or lease of all or
substantially all of its assets to another person shall be effected in such a
way that holders of shares of Common Stock shall be entitled to receive stock,
securities or assets with respect to or in exchange for their shares of Common
Stock, then provision shall be made, in accordance with this Section 6(a),
whereby each holder of shares of Series A Convertible Preferred Stock shall
thereafter have the right to receive such securities or assets as would have
been issued or payable with respect to or in exchange for the shares of Common
Stock into which the shares of Series A Convertible Preferred Stock held by such
holder were convertible immediately prior to the closing of such merger, sale,
transfer or lease, as applicable. The Corporation will not effect any such
consolidation, merger, sale, transfer or lease unless prior to the consummation
thereof the successor entity (if other than the Corporation) resulting from such
consolidation or merger or the entity purchasing or leasing such assets shall
assume by written instrument (i) the obligation to deliver to the holders of
Series A Convertible Preferred Stock such securities or assets as, in accordance
with the foregoing provisions, such holders may be entitled to purchase, and
(ii) all other obligations of the Corporation hereunder. The provisions of this
Section 6(a) shall similarly apply to successive mergers, sales, transfers or
leases.
(b) Common Stock Dividends,
Subdivisions, Combinations, etc. In
case the Corporation shall hereafter (i) declare a dividend or make a
distribution on its outstanding shares of Common Stock in shares of Common
Stock, (ii) subdivide or reclassify its outstanding shares of Common Stock into
a greater number of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the Conversion Rate in
effect at the time of the record date for such dividend or distribution or of
the effective date of such subdivision, combination or reclassification shall be
adjusted so that it shall equal the number of shares of Common Stock determined
by multiplying the then applicable Conversion Rate by a fraction, the
denominator of which shall be the number of shares of Common Stock outstanding
after giving effect to such action, and the numerator of which shall be the
number of shares of Common Stock outstanding immediately prior to such action.
Such adjustment shall be made successively whenever any event listed above shall
occur.
(c) Discounted Common
Stock.
(i) Subject
to Section 6(c)(iii), for a period of 24 months following the date of issuance
of the Series A Convertible Preferred Stock, in case the Corporation shall issue
shares of its Common Stock, Preferred Stock, stock options, warrants or
convertible securities for cash consideration per share less than $1.00 (the
“Offering Price”), the Conversion Rate shall be adjusted
immediately thereafter so that it shall equal the rate determined by multiplying
the Conversion Rate in effect immediately prior thereto by a fraction, the
numerator of which shall be the sum of the number of shares of Common Stock
outstanding immediately prior to the issuance of such additional shares and the
number of shares of Common Stock which the aggregate consideration received for
the issuance of such additional shares would purchase at such current market
price per share of Common Stock, and the denominator of which shall be the
number of shares of Common Stock outstanding immediately after the issuance of
such additional shares.
(ii) Subject
to Section 6(c)(iii), adjustments to the Conversion Rate pursuant to this
Section 6(c) shall be made successively whenever an issuance of shares
triggering such an adjustment is made.
(iii) Notwithstanding
anything to the contrary set forth in this Section 6(c), no adjustment to the
Conversion Rate shall be made pursuant to this Section 6(c) in the case of (A)
shares of Common Stock (or common stock equivalents) issued in acquisitions,
mergers or strategic alliances, as reasonably determined by the Board of
Directors of the Corporation and approved by Verus International Group Ltd. and
Saffron Hill Ventures Ltd. on a case-by-case basis, or (B) exercises of
outstanding Image Metrics Limited stock options and warrants assumed by the
Corporation.
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(iv) Notwithstanding
anything to the contrary set forth in this Section 6(c), the Conversion Rate
shall not be reduced as a result of the application of this Section
6(c).
(v) The
consent of four out of five directors of the Corporation (or, in any event, not
less than eighty percent (80%) of the then number of directors) is required to
approve the issuance of shares of Common Stock (or common stock equivalents) in
a financing transaction during the 24-month period referenced in subparagraph
(c)(i) above at a sale price of less than the Offering Price.
(d) Notice of
Adjustment. Whenever the Conversion
Rate is adjusted as herein provided, the Corporation shall promptly but no later
than 10 days after any request for such an adjustment by the holder, cause a
notice setting forth the adjusted Conversion Rate issuable upon exercise of each
share of Series A Convertible Preferred Stock, and, if requested, information
describing the transactions giving rise to such adjustments, to be mailed to the
holders at their last addresses appearing in the share register of the
Corporation, and shall cause a certified copy thereof to be mailed to its
transfer agent, if any. The Corporation may retain a firm of independent
certified public accountants selected by the Board of Directors (who may be the
regular accountants employed by the Corporation) to make any computation
required by this Section 6, and a certificate signed by such firm shall be
conclusive evidence of the correctness of such adjustment.
(e) Waiver of Rights. Notwithstanding anything to the contrary set
forth herein, in the event any of the anti-dilution rights set forth in Section
6 of these Articles of Incorporation are duly waived or modified by the holders
thereof, the analogous rights set forth in Section 6 hereof shall be deemed
similarly waived or modified without any further action on the part of the
holders of Series A Convertible Preferred Stock.
(f) Termination. The provisions of this Section 6 shall be of no
further force and effect (i) as to any particular holder, once the shares of
Series A Convertible Preferred Stock held by such holder are no longer
outstanding or (ii) after the expiration of the 24-month period referenced in
Section 6(c)(1) above, whichever event occurs sooner.
7.
Redemption. The Corporation may not redeem the outstanding
shares of Series A Convertible Preferred Stock and the holders shall not have
any right, at any time or under any circumstances, to require the Corporation to
redeem any of the Series A Convertible Preferred Stock.
8.
Voting Rights.
(a) Except
as otherwise required by law, the holders of shares of Series A Convertible
Preferred Stock shall be entitled to vote on all matters submitted to a vote of
the shareholders of the Corporation and shall have such number of votes equal to
the number of shares of Common Stock into which such holders’ shares of Series A
Convertible Preferred Stock are convertible pursuant to the provisions hereof at
the record date for the determination of shareholders entitled to vote on such
matters or, if no such record date is established, at the date such vote is
taken or any written consent of shareholders is solicited. Except as otherwise
required by law, the holders of shares of Series A Convertible Preferred Stock
and Common Stock shall vote together as a single class, and not as separate
classes.
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(b) In
the event that the holders of the Series A Convertible Preferred Stock are
required to vote as a class, the affirmative vote of holders of not less than
two-thirds of the outstanding shares of Series A Convertible Preferred Stock
shall be required to approve each such matter to be voted upon, and if any
matter is approved by such requisite percentage of holders of Series A
Convertible Preferred Stock, such matter shall bind all holders of Series A
Convertible Preferred Stock.
9. Covenants of the
Corporation. The Corporation
covenants and agrees that, so long as the Shares are outstanding, it will
perform the obligations set forth in this Section 9:
(a) Taxes and Levies. The Corporation will promptly pay and discharge
all taxes, assessments, and governmental charges or levies imposed upon the
Corporation or upon its income and profits, or upon any of its property, before
the same shall become delinquent, as well as all claims for labor, materials and
supplies which, if unpaid, might become a lien or charge upon such properties or
any part thereof; provided, however, that the Corporation shall not be required to
pay and discharge any such tax, assessment, charge, levy or claim so long as the
validity thereof shall be contested in good faith by appropriate proceedings and
the Corporation shall set aside on its books adequate reserves in accordance
with generally accepted accounting principles (“GAAP”) with respect to any such tax, assessment,
charge, levy or claim so contested;
(b) Maintenance of
Existence. The Corporation will do
or cause to be done all things reasonably necessary to preserve and keep in full
force and effect its corporate existence, rights and franchises and comply with
all laws applicable to the Corporation, except where the failure to comply would
not have a material adverse effect on the Corporation;
(c) Maintenance of
Property. The Corporation will at
all times maintain, preserve, protect and keep its property used or useful in
the conduct of its business in good repair, working order and condition, and
from time to time make all needful and proper repairs, renewals, replacements
and improvements thereto as shall be reasonably required in the conduct of its
business;
(d) Insurance. The Corporation will, to the extent necessary
for the operation of its business, keep adequately insured by financially sound
reputable insurers, all property of a character usually insured by similar
corporations and carry such other insurance as is usually carried by similar
corporations;
(e) Books and
Records. The Corporation will at all
times keep true and correct books, records and accounts reflecting all of its
business affairs and transactions materially in accordance with GAAP;
and
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(f) Notice of Certain
Events. The Corporation will give
prompt written notice (with a description in reasonable detail) to the holders
of Series A Convertible Preferred Stock in the event the Corporation
shall:
(i) become
insolvent or generally fail or be unable to pay, or admit in writing its
inability to pay, its debts as they become due;
(ii) apply
for, consent to, or acquiesce in, the appointment of a trustee, receiver,
sequestrator or other custodian for the Corporation or any of its property, or
make a general assignment for the benefit of creditors;
(iii) in
the absence of such application, consent or acquiesce in, permit or suffer to
exist the appointment of a trustee, receiver, sequestrator or other custodian
for the Corporation or for any part of its property;
(iv) permit
or suffer to exist the commencement of any bankruptcy, reorganization, debt
arrangement or other case or proceeding under any bankruptcy or insolvency law,
or any dissolution, winding up or liquidation proceeding, in respect of the
Corporation, and, if such case or proceeding is not commenced by the Corporation
or converted to a voluntary case, such case or proceeding shall be consented to
or acquiesced in by the Corporation or shall result in the entry of an order for
relief; or
(v) enter
into any agreement to merge or consolidate with any other person or sell,
transfer or lease all or substantially all of its assets to any other
person;
(vi) declare
any split of its outstanding shares of capital stock, declare or make any
dividend or distribution, or subdivide, reclassify or combine any of its
outstanding shares of capital stock.
(g) Investor
Nominees. For a period of 24 months
following the date of the issuance of the Series A Convertible Preferred Stock,
Verus International Group Ltd. and Saffron Hill Investors Guernsey Limited, on
behalf of the holders of shares of Series A Convertible Preferred Stock, shall
(i) each be entitled to designate one person to be a nominee for election to the
Corporation’s Board of Directors (the “Series A
Nominees”) and (ii) have the right
to jointly approve one additional nominee for election to the Corporation’s
Board of Directors (together with the Series A Nominees, the “Investor
Nominees”). The number of Investor
Nominees set forth in this Section 9(g) is based on the size of the entire Board
of Directors being fixed at five directors, provided that in the event the size
of the entire Board of Directors is increased, then the number of Investor
Nominees shall be proportionally increased relative to the then number of
directors on the Corporation’s Board of directors. The Corporation shall use its
best efforts (which shall include, without limitation, the solicitation of
proxies on behalf of the Investor Nominees) to elect such Investor Nominees to
the Board of Directors.
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10. Reservation of
Shares. The Corporation shall at all
times reserve and keep available and free of preemptive rights out of its
authorized but unissued Common Stock, solely for the purpose of effecting the
conversion of the Series A Convertible Preferred Stock pursuant to the terms
hereof, such number of its shares of Common Stock (or other shares or other
securities as may be required) as shall from time to time be sufficient to
effect the conversion of all outstanding Series A Convertible Preferred Stock
pursuant to the terms hereof If at any time the number of authorized but
unissued shares of Common Stock (or such other shares or other securities) shall
not be sufficient to affect the conversion of all then outstanding Series A
Convertible Preferred Stock, the Corporation shall promptly take such action as
may be necessary to increase its authorized but unissued Common Stock (or other
shares or other securities) to such number of shares as shall be sufficient for
such purpose.
11. Miscellaneous.
(a) There
is no sinking fund with respect to the Series A Convertible Preferred
Stock.
(b) The
shares of the Series A Convertible Preferred Stock shall not have any
preferences, voting powers or relative, participating, optional, preemptive or
other special rights (including no preemptive rights to purchase or otherwise
acquire additional shares in the Corporation) except as set forth above in this
Articles of Incorporation of the Corporation.
(c) The
holders of the Series A Convertible Preferred Stock shall be entitled to receive
all communications sent by the Corporation to the holders of the Common
Stock.
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