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EXHIBIT
3.4
CERTIFICATE OF DESIGNATION OF POWERS,
PREFERENCES AND RIGHTS OF
SERIES B CONVERTIBLE PREFERRED STOCK
OF
YOUNGEVITY INTERNATIONAL, INC.
a Delaware corporation
ADOPTED IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 151 OF THE
DELAWARE GENERAL CORPORATION LAW
Youngevity
International, Inc., a Delaware corporation (the
“Corporation”),
pursuant to Section 151 of the General Corporation Law of the State
of Delaware, certifies that the directors of the Corporation have
unanimously adopted the resolutions attached hereto as Appendix I providing for the
issuance of 1,052,631 shares of Series B Convertible Preferred
Stock.
The
undersigned certifies that he is the duly elected President of the
Corporation.
IN WITNESS WHEREOF, the Corporation has
caused this Certificate to be executed by David Briskie, its
President, this ____ day of _______, 2018.
YOUNGEVITY INTERNATIONAL, INC.
By:
_/s/ David
Briskie
David
Briskie
President
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APPENDIX I
The
undersigned, being all of the members of the Board of Directors of
Youngevity, Inc. (the “Corporation”), do hereby
consent to the following actions and adopt the following preamble
and resolutions by written consent pursuant to Section 141(f) of
the Delaware General Corporation Law:
WHEREAS, the Certificate of
Incorporation (the “Certificate”) of the
Corporation provides for a class of stock designated as preferred
stock, par value $.001 per share (the “Preferred Stock”),
comprising 5,000,000 shares, issuable from time to time and in one
or more series and authorizes the Board of Directors (the
“Board”) of the
Corporation to fix or alter the rights, preferences, privileges and
restrictions granted to or imposed upon any wholly unissued series
of Preferred Stock and the number of shares constituting any such
series and the designations thereof; and
WHEREAS, the Certificate also provides
for a class of stock designated as common stock, $.001 par value
per share, comprising 50,000,000 shares (the “Common Stock”). The term
“Common Stock” when used in this resolution with
reference to the Common Stock into which a share of Preferred Stock
is convertible, shall mean only Common Stock of the Corporation,
$.001 par value per share, and any stock into which the Common
Stock may hereafter be changed; and
WHEREAS, it is the desire of the Board
to authorize the issuance of a series of Preferred Stock and to
determine the rights, preferences, privileges, restrictions and
other matters relating to the series of Preferred
Stock.
NOW, THEREFORE, IT IS RESOLVED that the
Corporation does hereby provide for the issuance of a series of
convertible Preferred Stock of the Corporation, consisting of
1,052,631 shares which
shall be designated as “Series B Convertible Preferred
Stock”, and does hereby fix and determine the powers,
preferences and rights relating to said Series B Convertible
Preferred Stock:
SERIES
B CONVERTIBLE PREFERRED STOCK
1.
Designation of Shares; Rank.
(a.)
This series of
preferred stock shall be designated and known as Series B
Convertible Preferred Stock (the “Series B Preferred
Stock”). The number of shares constituting the Series
B Preferred Stock shall be 1,052,631 shares, par value $.001 per
share.
(b.)
Except as otherwise
provided herein, so long as any Series B Preferred Stock is
outstanding, with respect to redemption rights, dividends, rights
on Liquidation (as hereinafter defined), winding up, corporate
reorganization and dissolution, the Series B Preferred Stock shall
rank senior to the Common Stock, the Series A Convertible Preferred
Stock (the “Series A
Preferred Stock”) and any other class or series of stock
ranking junior to the Series B Preferred Stock.
2.
Conversion.
The holders of shares of Series B Preferred Stock shall have the
following conversion rights:
(a.)
Right to Convert. Subject to
the terms and conditions of this paragraph 2(a), each holder of any
shares of the Series B Preferred Stock shall have the right, at
his, her or its option, at any time and from time to time and
without the payment of additional consideration by the holder
thereof, to convert each share of Series B Preferred Stock held by
such holder into such number of shares of Common Stock as is
determined by dividing $9.50 together with all accrued or declared
and unpaid dividends of the Series B Preferred by the Conversion
Price (as defined below). Such right of conversion shall be
exercised by the holder hereof by giving written notice that the
holder elects to convert a stated number of shares of Series B
Preferred Stock into Common Stock and by surrender of a certificate
or certificates for the shares to be converted to the Corporation
at its principal office (or such other office or agency of the
Corporation as the Corporation may designate in writing to the
holders of Series B Preferred Stock) in which the certificate or
certificates for shares of Common Stock shall be issued. If
required by the Corporation, any certificate for shares surrendered
for conversion shall be accompanied by instruments of transfer, in
a form reasonably satisfactory to the Corporation, duly executed by
the holder of such Series B Preferred Shares or his, her or its
duly authorized representative.
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(b.)
Automatic Conversion. Each
outstanding share of Series B Preferred Stock, on the two-year
anniversary of its respective original issuance date, shall convert
into such number of shares of Common Stock as is determined by
dividing $9.50 by the Conversion Price.
(c.)
Mechanics of Conversion. All
shares of Series A Convertible Preferred Stock which 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 and to
vote, shall immediately cease and terminate on the Conversion Date
at the time of conversion, except only the right of the holders
thereof to receive shares of Common Stock in exchange therefor, to
receive payment in lieu of any fraction of a share otherwise
issuable upon such conversion and payment of any dividends declared
but unpaid on the Series A Convertible Preferred Stock. Any shares
of Series A Convertible Preferred Stock so converted shall be
retired and canceled and return to the status of and constitute
authorized but unissued shares of Preferred Stock, without
classification as to series until such shares are once more
classified as a particular series by the Board of Directors
pursuant to the provisions of the Certificate of
Incorporation.
(d.)
Issuance of Certificates; Time
Conversion Effected. Promptly after the conversion of Series
B Preferred Stock and surrender to it of the certificate or
certificates for the share or shares of Series B Preferred Stock to
be converted, the Corporation shall issue and deliver, or cause to
be issued and delivered, to the holder, registered in such name or
names as such holder may direct, a certificate or certificates for
the number of whole shares of Common Stock issuable upon the
conversion of such share or shares of Series B Preferred Stock. To
the extent permitted by law, such conversion shall be deemed to
have been effected as of the close of business on the later of the
date on which such written notice shall have been received by the
Corporation and the certificate or certificates for such share or
shares shall have been surrendered as aforesaid, and at such time
the rights of the holder of such share or shares of Series B
Preferred Stock shall cease, and the person or persons in whose
name or names any certificate or certificates for shares of Common
Stock shall be issuable upon such conversion shall be deemed to
have become the holder or holders of record of the shares of Common
Stock represented thereby.
(e.)
No Fractional Shares; Dividends,
Partial Conversion. No fractional shares shall be issued
upon conversion of Series B Preferred Stock into Common Stock and
no payment or adjustment shall be made upon any conversion on
account of any cash dividends on the Common Stock issued upon such
conversion. At the time of each conversion pursuant to subparagraph
2(a) or 2(b), the Corporation shall pay, to the extent permitted by
law, in cash an amount equal to all accrued and unpaid dividends on
the shares of Series B Preferred Stock surrendered for conversion
to the date upon which such conversion is deemed to take place as
provided in subparagraph 2(c). In case the number of shares of
Series B Preferred Stock represented by the certificate or
certificates surrendered exceeds the number of shares converted,
the Corporation shall, upon such conversion, execute and deliver to
the holder, at the expense of the Corporation, a new certificate or
certificates for the number of shares of Series B Preferred Stock
represented by the certificate or certificates surrendered which
are not to be converted. If any fractional share of Common Stock
would, except for the provisions of the first sentence of this
subparagraph 2(d), be delivered upon such conversion, the
Corporation, in lieu of delivering such fractional share, shall
pay, to the extent permitted by law, to the holder surrendering the
Series B Preferred Stock for conversion an amount in cash equal to
the current fair market value of such fractional share as
determined in good faith by the Board.
(f.)
Conversion Price. The initial
Conversion Price is $4.25.
(g.)
Adjustment to Conversion Price by
Reason of Stock Split, Stock Dividend, Recapitalization, Merger,
etc. In the event of any change in the outstanding shares of
Series B Preferred Stock or Common Stock of the Corporation by
reason of any stock split, stock dividend, recapitalization,
merger, consolidation, combination or exchange of shares or other
similar change in the capital structure of the Corporation, the
Board shall make such equitable adjustments to the Conversion Price
as it determines, in its sole discretion, are necessary and
appropriate in order to preserve the intrinsic value of the Series
B Preferred Stock. Any such adjustments shall be set forth in a
written notice to the holders of Series B Preferred Stock and shall
be conclusive and binding on each holder.
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3.
Liquidation.
(a.)
Upon any
liquidation, dissolution or winding up of the Corporation, either
voluntary or involuntary (a “Liquidation”), the
holders of Series B Preferred Stock shall first be entitled to
receive, out of the assets of the Corporation available for
distribution to its stockholders, before any distribution or
payment is made or any asset distributed to the holders of Common
Stock, the Series A Preferred Stock or any other class or series of
stock ranking junior to the Series B Preferred Stock, but subject
to the rights of holders of any other then outstanding shares of
preferred stock, the pari passu rights of
holders of any then outstanding shares of Series B Preferred Stock
and the rights of holders of any then outstanding shares of any
other series of stock ranking pari passu with
respect to the Liquidation rights of the Series B Preferred Stock,
to be paid an amount equal to $9.50 for each and every share of
Series B Preferred Stock held by the holders of Series B Preferred
Stock, plus all accrued and unpaid dividends (the
“Series B
Liquidation Payment”).
(b.)
If upon such
Liquidation, the assets to be distributed among the holders of
Series B Preferred Stock shall be insufficient to permit payment in
full to the holders of Series B Preferred Stock and the holders of
any securities ranking pari passu as to
liquidation rights with the Series B Preferred Stock, then the
assets available for payment or distribution to such holders shall
be allocated among the holders of the Series B Preferred Stock and
such holders of securities pari passu with the
Series B Preferred Stock in proportion to the full respective
preferential amounts to which each are entitled.
(c.)
Upon a Liquidation,
immediately after the holders of Series B Preferred Stock and the
holders of securities ranking pari passu with the
Series B Preferred Stock shall have been paid in full the Series B
Liquidation Payments, then the amount of the remaining assets of
the Corporation legally available for distribution, if any, shall
be distributed among the holders of any securities junior to the
Series B Preferred Stock in accordance with their respective
priorities.
(d.)
After full payment
of the Series B Liquidation Payment as set forth above, such shares
of Series B Preferred Stock shall no longer be deemed to be
outstanding and the holders thereof shall have no further rights as
holders of Series B Preferred Stock.
4.
Voting.
(a.)
Except as otherwise
provided herein or as otherwise required by law, the Series B
Preferred Stock shall have no voting rights. However, as long as
any shares of Series B Preferred Stock are outstanding, the
Corporation shall not, without the affirmative vote of the holders
of a majority of the then outstanding shares of the Series B
Preferred Stock alter or change adversely the powers, preferences
or rights given to the Series B Preferred Stock or alter or amend
this Certificate of Designation.
5.
Dividends.
(a.)
Commencing on the
date of the initial issuance of the Series B Preferred Stock, a
holder of record of shares of Series B Preferred Stock shall be
entitled to receive, out of any funds at the time legally available
therefor, a cash dividend at the per annum rate of an amount equal
to the product of five percent (5%) and $9.50 per share of the
Series B Preferred Stock owned by such holder, subject to
adjustment in the event of a stock dividend stock split or other
similar event. Dividends on the Series B Preferred Stock shall be
cumulative, shall accrue and shall be payable to holders quarterly
in arrears, on or about the last day of March, June, September and
December of each year, commencing June 30, 2018, or, if such day is
not a business day, on either the immediately preceding business
day or next succeeding business day at the Corporation’s
option, except that, if such business day is in the next succeeding
year, such payment shall be made on the immediately preceding
business day, in each case with the same force and effect as if
made on such date. The term “business day” means each
day, other than a Saturday or a Sunday, which is not a day on which
banks in New York are required to close.
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(b.)
Dividends on the
Series B Preferred Stock are prior and in preference to any
declaration or payment of any distribution on any outstanding
shares of Common Stock, the Series A Preferred Stock or any other
class or series of stock ranking junior to the Series B Preferred
Stock. Such dividends shall accrue on each share of Series B
Preferred Stock whether or not earned or declared. In the case of
Series B Preferred Stock outstanding for less than a full quarter,
dividends shall be pro rata based on
the portion of the quarter during which such shares are
outstanding.
(c.)
So long as any
shares of Series B Preferred Stock are outstanding, the Corporation
shall not declare, pay or set apart for payment any dividend or
make any distribution on Common Stock or other class or series of
stock ranking junior to the Series B Preferred Stock (other than
dividends or distributions payable in additional shares of junior
stock), unless at the time of such dividend or distribution the
Corporation shall have paid all accrued and unpaid dividends on the
outstanding shares of Series B Preferred Stock.
(d.)
Notwithstanding the
foregoing, if the aggregate amount of dividends then accrued and
payable to a holder is less than $10.00, the Corporation may, at
its option, retain and not make payment in respect of such
dividends until the aggregate amount of dividends then accrued and
payable to the holder is not less than $10.00.
RESOLVED, that the officers of the Corporation are
authorized to file with the Secretary of State of Delaware a
Certificate of Designation providing for the issuance of the series
of stock designated in the foregoing resolution and that each of
the officers of the Corporation is individually authorized,
empowered and directed, in the name and on behalf of the
Corporation, to take all such further actions and execute and
deliver all such further documents and instruments as such officer
may approve as necessary or desirable to carry out the intent and
purpose of the foregoing resolutions, the taking of any action or
the execution and delivery of any document or instrument by that
officer to be conclusive evidence of that approval.
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