0000912057-01-537662.txt : 20011112
0000912057-01-537662.hdr.sgml : 20011112
ACCESSION NUMBER: 0000912057-01-537662
CONFORMED SUBMISSION TYPE: 8-K/A
PUBLIC DOCUMENT COUNT: 2
CONFORMED PERIOD OF REPORT: 20011001
ITEM INFORMATION: Acquisition or disposition of assets
ITEM INFORMATION: Financial statements and exhibits
FILED AS OF DATE: 20011105
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: 5B TECHNOLOGIES CORP
CENTRAL INDEX KEY: 0001000179
STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER RENTAL & LEASING [7377]
IRS NUMBER: 113529387
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K/A
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-27190
FILM NUMBER: 1774910
BUSINESS ADDRESS:
STREET 1: 100 SUNNYSIDE BLVD
CITY: WOODBURY
STATE: NY
ZIP: 11797
BUSINESS PHONE: 5166776100
MAIL ADDRESS:
STREET 1: 100 SUNNYSIDE BLVD
CITY: WOODBURY
STATE: NY
ZIP: 11797
FORMER COMPANY:
FORMER CONFORMED NAME: PARAMOUNT FINANCIAL CORP
DATE OF NAME CHANGE: 19950906
8-K/A
1
a2062309z8-ka.txt
FORM 8-K/A
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 1, 2001
-----------------------------------------------------------------
5B Technologies Corporation
-----------------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-27190
-------- -------
(State or Other Jurisdiction (Commission
of Incorporation) File Number)
100 Sunnyside Boulevard, Woodbury, NY 11797
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(Address of Principal Executive Offices)
Registrant's telephone number, (516) 677-6100
Not Applicable
------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
--------------------------------------------------------------------------------
On October 1, 2001, 5B Technologies Corporation (the "Company" or
"Registrant") acquired certain assets of Galt Corporation ("Galt"), an
applications development and Web hosting company in exchange for: (i) 300,000
shares of Company common stock, par value $.04 per share, (ii) 300,000 shares of
Company preferred stock, par value $.01 per share, convertible at $3.33 per
share, and (iii) warrants to acquire 300,000 shares of Company common stock at
an exercise price of $1.00 per share. The consideration for the assets was
determined in arms length negotiations with Galt. The issuance of the common
stock representing 19.9% or more of the outstanding common stock upon the
conversion of the preferred stock and the exercise of the warrant is contingent
upon stockholder approval in conformance with NASD regulations. The assets
acquired include customers, customer lists, certain employees, certain contracts
and agreements and computer equipment which were used by Galt in connection with
their business, and will be continued to be used by the Company in a similar
manner.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
--------------------------------------------------------------------------------
(c) Exhibit included herein:
3.6 - Certificate of Designation of Series F and Series G
Convertible Preferred Stock of the Company.
(d) Exhibit previously filed on October 15, 2001:
10.24 - Asset Purchase Agreement, dated as of September 14,
2001, by and among Abby Garrett & Seth, Ltd., the
Company, Galt, Alan Sheinwald and Kenneth Greene.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
5B TECHNOLOGIES CORPORATION
Date: November 5, 2001 By: /s/ Glenn Nortman
------------------------- --------------------------------------
Glenn Nortman, Chief Executive Officer
EX-3.6
3
a2062309zex-3_6.txt
EXHIBIT 3.6
EXHIBIT 3.6
CERTIFICATE OF DESIGNATION
FOR
SERIES F CONVERTIBLE PREFERRED STOCK AND
SERIES G CONVERTIBLE PREFERRED STOCK
OF
5B TECHNOLOGIES CORPORATION
--------------------
Pursuant to Section 151 of the General Corporation Law of the State of Delaware
---------------------
The undersigned, Glenn Nortman, hereby certifies that:
1. I am the duly elected and acting Chief Executive Officer of 5B
Technologies Corporation, a Delaware corporation (the
"Corporation").
2. The Certificate of Incorporation of the Corporation authorizes five
million (5,000,000) shares of preferred stock, $0.01 par value per
share.
3. The following is a true and correct copy of the resolution duly
adopted by the unanimous written consent of the Board of Directors
of the Corporation (the "Board of Directors") on September 14, 2001
pursuant to the Certificate of Incorporation of the Corporation and
in accordance with the provisions of the General Corporation Law of
the State of Delaware, relating to the designation and issuance of
the Series F and G preferred stock, each at a par value $.01 per
share, of the Corporation, to be designated "Series F Convertible
Preferred Stock" and "Series G Convertible Preferred Stock," which
resolution remains in full force and effect as of the date hereof:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of the Corporation by the Certificate of Incorporation, the
Board of Directors does hereby provide for the issuance of the following
series of preferred stock, par value $0.01 per share, of the Corporation,
to be designated "Series F Convertible Preferred Stock" ("Series F
Preferred") and "Series G Convertible Preferred Stock" ("Series G
Preferred," together with the Series F Preferred, hereinafter collectively
referred to as the "Preferred Stock") which shall have the designation,
rights, preferences, privileges and restrictions and limitations as
follows:
I SERIES F CONVERTIBLE PREFERRED STOCK
(A) DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "Series F Convertible Preferred Stock," par value $0.01 per
share (the "Series F Preferred"), and the number of shares constituting
such series shall be 300,000.
(B) RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS OF THE SERIES F
PREFERRED. The rights, preferences, privileges and restrictions granted to
and imposed on the Series F Preferred are as follows:
(1) DIVIDEND PROVISIONS.
The holders of shares of the Series F Preferred shall not be
entitled to receive dividends
(2) LIQUIDATION PREFERENCE.
(a) In the event of any liquidation, dissolution or winding up of
the Corporation, either voluntary or involuntary, the holders of the
Series F Preferred shall be entitled to receive, in cash, after any
distributions are made to the holders of Senior Securities but prior
and in preference to any distribution of any of the assets or
surplus funds of the Corporation to the holders of the Common Stock
or any other Junior Securities by reason of their ownership thereof,
the amount of $3.3333 per share (the "Original Series F Preferred
Stock Issue Price") (as adjusted for stock splits, stock dividends,
combinations, recapitalizations and similar events) in cash or cash
equivalents for each share of Series F Preferred then held by them,
and, in addition, an amount equal to all accrued but unpaid
dividends on such shares of Series F Preferred in cash or cash
equivalents. If upon occurrence of such event the assets and funds
thus distributed ratably among the holders of the Series F Preferred
shall be insufficient to permit the payment to such holders (and the
holders of any series of preferred stock that ranks on a parity with
the Series F Preferred on any liquidation, dissolution or winding up
of the Corporation), including, without limitation the holders of
the Series G Preferred, of the full preferential amount, then the
entire assets and funds of the Corporation legally available for
distribution shall be distributed among the holders of the Series F
Preferred (and such parity stock) in proportion to the amount that
the holders of the Series F Preferred and the holders of such parity
stock would be entitled to receive if they were to be paid the full
amounts due to them at the time of such liquidation, dissolution or
winding up. After payment has been made to the holders of the Series
F Preferred and such parity stock of the full amounts to which they
shall be entitled as aforesaid, all remaining assets of the
Corporation shall be distributed among all holders of the preferred
stock of the Corporation that rank junior to the Series F Preferred
on any liquidation, dissolution or winding up of the Corporation and
all holders of Common Stock and other Junior Securities in
proportion to the number of shares of Common Stock which would be
held by each such holder if all shares of such series of
2
preferred stock were converted into Common Stock.
(3) CONVERSION. The holders of the Series F Preferred shall each have
conversion rights as follows (the "Conversion Rights"):
(a) RIGHT TO CONVERT. Subject to the limitations set forth in
subsection 3(b) below, each share of Series F Preferred (i) may be
convertible at the option of the holders of the Series Stock F
Preferred into one fully paid and nonassessable share of Common
Stock, as adjusted for stock splits, stock dividends, combinations,
recapitalizations and similar events, at any time after the ten (10)
day average closing price of the Common Stock exceeds $3.33 per
share and (ii) shall be automatically converted, without any action
by the holders of the Series F Preferred, into one fully paid and
nonassessable share of Common Stock, as adjusted for stock splits,
stock dividends, combinations, recapitalizations and similar events,
on the first day business day occurring two years from the date of
the filing of this Certificate of Designation.
(b) NASDAQ CONVERSION LIMITATION. Unless the Company obtains the
requisite approval of its stockholders to comply with the applicable
rules of the Nasdaq SmallCap Market, Nasdaq OTC Bulletin Board or
the Nasdaq National Market, no holder of any shares of Series F
Preferred may exercise its conversion rights to the extent that such
conversion would, together with (i) an aggregate of 300,000 shares
of Common Stock issued by the Corporation to such holder on the date
hereof, (ii) 300,000 shares of Common Stock subject to outstanding
warrants to purchase Common Stock and (iii) shares of Common Stock
issued upon conversion of the Series G Preferred, cause such holder
to obtain more than 19.9% of all issued and outstanding shares of
Common Stock including shares issuable in respect of outstanding
scrip or any certificates representing fractional interests in such
shares of Common Stock. The prior sentence shall not prohibit any
holder of shares of Series F Preferred from exercising its
conversion rights at any time following such time as the Common
Stock is not listed on the Nasdaq SmallCap Market, Nasdaq OTC
Bulletin Board or the Nasdaq National Market. Nothing in this
subsection 3(b) shall prohibit a holder of Series F Preferred from
converting such stock if and to the extent that the shares issued
upon such conversion, together with the shares of Common Stock
referred to in subclauses (i), (ii) and (iii) above and any and all
shares of Common Stock issued upon prior conversions by such holder
of the Series F Preferred, would equal 19.9% or less of all issued
and outstanding shares of Common Stock including shares issuable in
respect of outstanding script or any certificates representing
fractional interests in such shares of Common Stock. With respect to
any holder of Series F
3
Preferred, all references in this subsection 3(b) to 19.9% of all
issued and outstanding shares of Common Stock of the Corporation
shall mean 19.9% of such issued and outstanding Common Stock as of
the date of issuance by the Corporation of the Series F Preferred to
such holder.
(c) SHAREHOLDER VOTE REGARDING CONVERSION LIMITATION. If a holder of
the Series F Preferred is unable to exercise its conversion rights
due to the limitations set forth in subsection 3(b) above, the Board
of Directors shall use commercially reasonable efforts to present
and recommend to the stockholders of the Company at the next annual
meeting of stockholders (to be held in accordance with the corporate
laws of Delaware, the Certificate of Incorporation and the Bylaws of
the Company) a proposal to approve such holder acquiring in excess
of 19.9% of the issued and outstanding shares of Common Stock upon
conversion of the Series F Preferred. The Corporation hereby
undertakes to present such proposal at the annual meeting of
stockholders to take place in 2002 or, if earlier, at the next
meeting of stockholders (or in the next action taken by consent of
stockholders without a meeting) other than the annual meeting of
stockholders to take place in 2001. If such approval is not obtained
at the next such meeting of the stockholders of the Corporation (or
in the next action taken by consent of stockholders without a
meeting), the Corporation shall thereafter continue to use
commercially reasonable efforts to effect such approval. In no event
may the Corporation issue more than 19.9% of the issued and
outstanding shares of Common Stock as determined in subsection 3(b)
above without obtaining such requisite vote of stockholders as set
forth herein.
(d) MECHANICS OF CONVERSION. No fractional shares of Common Stock
shall be issued upon conversion of the Series F Preferred. In lieu
of any fractional share to which a holder would otherwise be
entitled, the Corporation shall pay cash equal to such fraction
multiplied by the fair market value of the Common Stock as
determined by the Board of Directors. Before any holder of the
Series F Preferred shall be entitled to convert the same into full
shares of Common Stock, he shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the
Corporation or of any transfer agent for the Series F Preferred, as
designated by the Corporation, and shall give written notice to the
Corporation at such office that he elects to convert the same. The
Corporation shall, as soon as practicable thereafter, issue and
deliver at such office to such holder of Series F Preferred, a
certificate or certificates for the number of shares of Common Stock
to which such holder shall be entitled as aforesaid and a check
payable to the holder in the amount of any cash amounts payable as
the result of a conversion into a fractional share of Common Stock
and, if the Corporation shall exercise the option referred
4
to in the last sentence of Section I(B)(1)(b), any amount owed to
such holder as the result of such exercise. Such conversion shall be
deemed to have been made immediately prior to the close of business
on the date of such surrender of the shares of Series F Preferred to
be converted, 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.
(e) NO IMPAIRMENT.
(i) The Corporation will not, by amendment of its
Certificate of Incorporation or through any reorganization,
transfer of assets, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Corporation but will at
all times in good faith assist in the carrying out of all the
provisions of this section 3 and in the taking of all such
action as may be necessary or appropriate in order to protect
the conversion rights of the holders of the Series F Preferred
against impairment.
(ii) The Corporation shall at all times reserve and keep
available for issuance upon the conversion of the Series F
Preferred a number of its authorized but unissued shares of
Common Stock that will from time to time be sufficient to
permit the conversion of all outstanding shares of Series F
Preferred, and shall take all commercially reasonable action
required to increase the authorized number of shares of Common
Stock if at any time there shall be insufficient authorized
but unissued shares of Common Stock to permit such reservation
or to permit the conversion of all outstanding shares of
Series F Preferred.
(f) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Series F Conversion Price pursuant
to this section 3, the Corporation, at its expense, shall promptly
compute such adjustment or readjustment in accordance with the terms
hereof and furnish to each holder of Series F Preferred a
certificate setting forth such adjustment or readjustment and
showing in detail the facts upon which such adjustment or
readjustment is based.
(g) NOTICES OF RECORD DATE. In the event that this Corporation
shall propose at any time:
5
(i) to declare any dividend or distribution upon its
Common Stock, whether in cash, property, stock or other
securities, whether or not a regular cash dividend and whether
or not out of earnings or earned surplus; or
(ii) to effect any reclassification or recapitalization
or other reorganization of its capital stock;
then, in connection with each such event, this Corporation shall
send to the holders of the Series F Preferred shares at least 10
days' prior written notice of the date on which a record shall be
taken for any such event setting forth a description thereof. Such
written notice shall be given by first class mail, postage prepaid,
addressed to the holders of Series F Preferred at the address for
each such holder as shown on the books of this Corporation.
(4) VOTING. Except as otherwise required by law, the holders of Series F
Preferred shall not be entitled to vote upon any matter submitted to the
stockholders for a vote except as to matters affecting holders of Series F
Preferred as a class. In addition to any other rights provided by law, so
long as any Series F Preferred shall be outstanding, this Corporation
shall not, without first obtaining the affirmative vote or written consent
of the holders of more than 50 percent of such outstanding shares of
Series F Preferred, amend or repeal any provision of, or add any provision
to, this Certificate of Designation or Bylaws if such action would alter
or change the preferences, rights, privileges or powers of, or the
restrictions provided for the benefit of, the Series F Preferred;
(5) OPTIONAL REDEMPTION. At any time after giving the holders of the
Series F Preferred ten (10) days prior written notice, (the "Redemption
Notice Date"), the Corporation will, within sixty (60) days of the
Redemption Notice Date (the "Redemption Date"), redeem all or any portion
of the shares of Series F Preferred, by paying in cash, out of funds
legally available therefor, at Original Series F Preferred Stock Issue
Price after any adjustments for stock splits, stock dividends,
combinations, recapitalizations and similar events. Any holder of shares
of Series F Preferred may elect to convert such shares to Common Stock by
giving written notice to the Corporation within thirty (30) days after the
Redemption Notice Date and complying with the provisions of Section 3
hereof.
(6) RESIDUAL RIGHTS. All rights accruing to the outstanding shares of
this Corporation not expressly provided for to the contrary herein shall
be vested in the Common Stock.
6
II SERIES G CONVERTIBLE PREFERRED STOCK
(A) DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "Series G Convertible Preferred Stock," par value $0.01 per
share (the "Series G Preferred"), and the number of shares constituting
such series shall be 100,000.
(B) RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS OF THE SERIES G
PREFERRED. The rights, preferences, privileges and restrictions granted to
and imposed on the Series G Preferred are as follows:
(1) DIVIDEND PROVISIONS.
The holders of shares of the Series G Preferred shall not be
entitled to receive dividends.
(2) LIQUIDATION PREFERENCE.
(a) In the event of any liquidation, dissolution or winding up of
the Corporation, either voluntary or involuntary, the holders of the
Series G Preferred shall be entitled to receive, in cash, after any
distributions are made to the holders of Senior Securities but prior
and in preference to any distribution of any of the assets or
surplus funds of the Corporation to the holders of the Common Stock
or any other Junior Securities by reason of their ownership thereof,
the amount of $1.00 per share (the "Original Series G Preferred
Stock Issue Price") (as adjusted for stock splits, stock dividends,
combinations, recapitalizations and similar events) in cash or cash
equivalents for each share of Series G Preferred then held by them,
and, in addition, an amount equal to all accrued but unpaid
dividends on such shares of Series G Preferred in cash or cash
equivalents. If upon occurrence of such event the assets and funds
thus distributed ratably among the holders of the Series G Preferred
shall be insufficient to permit the payment to such holders (and the
holders of any series of preferred stock that ranks on a parity with
the Series G Preferred on any liquidation, dissolution or winding up
of the Corporation), including, without limitation the holders of
the Series F Preferred, of the full preferential amount, then the
entire assets and funds of the Corporation legally available for
distribution shall be distributed among the holders of the Series G
Preferred (and such parity stock) in proportion to the amount that
the holders of the Series G Preferred and the holders of such parity
stock would be entitled to receive if they were to be paid the full
amounts due to them at the time of such liquidation, dissolution or
winding up. After payment has been made to
7
the holders of the Series G Preferred and such parity stock of the
full amounts to which they shall be entitled as aforesaid, all
remaining assets of the Corporation shall be distributed among all
holders of the preferred stock of the Corporation that rank junior
to the Series G Preferred on any liquidation, dissolution or winding
up of the Corporation and all holders of Common Stock and other
Junior Securities in proportion to the number of shares of Common
Stock which would be held by each such holder if all shares of such
series of preferred stock were converted into Common Stock.
(3) CONVERSION. The holders of the Series G Preferred shall each have
conversion rights as follows (the "Conversion Rights"):
(a) RIGHT TO CONVERT. The Series G Preferred may be converted into
Common Stock of the Company at any time after 270 calendar days from
the filing date of this Certificate of Designation. After the
expiration of such time period, each share of Series G Preferred may
be convertible into a number of fully paid and nonassessable shares
of Common Stock, as adjusted for stock splits, stock dividends,
combinations, recapitalizations and similar events, as determined by
dividing the number of shares of Series G Preferred to be converted
by the greater of (i) the ten (10) trading day average closing price
(the "Average Closing Price") as reported on the NASDAQ Small Cap.
Market, or if the Common Stock is not trading on such market, on
such other market as the Common Stock most actively trades;
provided, that Average Closing Price shall not exceed $3.33 per
share or (ii) $0.56 per share. For the purpose of determining the
Average Closing Price, the last day of the ten (10) trading day
period shall end on date of the notice of conversion is received by
the Company. The conversion price so determined shall be the "Series
G Conversion Price." The provisions of this section 3(a) are subject
to the limitations set forth in subsection 3(b) below,
(b) NASDAQ CONVERSION LIMITATION. Unless the Company obtains the
requisite approval of its stockholders to comply with the applicable
rules of the Nasdaq SmallCap Market, Nasdaq OTC Bulletin Board or
the Nasdaq National Market, no holder of any shares of Series G
Preferred may exercise its conversion rights to the extent that such
conversion would, together with (i) an aggregate of 300,000 shares
of Common Stock issued by the Corporation to such holder on the date
hereof, (ii) 300,000 shares of Common Stock subject to outstanding
warrants to purchase Common Stock and (iii) shares of Common Stock
issued upon conversion of the Series G Preferred, cause such holder
to obtain more than 19.9% of all issued and outstanding shares of
Common Stock including shares issuable in respect of outstanding
scrip or any certificates representing fractional
8
interests in such shares of Common Stock. The prior sentence shall
not prohibit any holder of shares of Series G Preferred from
exercising its conversion rights at any time following such time as
the Common Stock is not listed on the Nasdaq SmallCap Market, Nasdaq
OTC Bulletin Board or the Nasdaq National Market. Nothing in this
subsection 3(b) shall prohibit a holder of Series G Preferred from
converting such stock if and to the extent that the shares issued
upon such conversion, together with the shares of Common Stock
referred to in subclauses (i), (ii) and (iii) above and any and all
shares of Common Stock issued upon prior conversions by such holder
of the Series G Preferred, would equal 19.9% or less of all issued
and outstanding shares of Common Stock including shares issuable in
respect of outstanding script or any certificates representing
fractional interests in such shares of Common Stock. With respect to
any holder of Series G Preferred, all references in this subsection
3(b) to 19.9% of all issued and outstanding shares of Common Stock
of the Corporation shall mean 19.9% of such issued and outstanding
Common Stock as of the date of issuance by the Corporation of the
Series G Preferred to such holder.
(c) SHAREHOLDER VOTE REGARDING CONVERSION LIMITATION. If a holder of
the Series G Preferred is unable to exercise its conversion rights
due to the limitations set forth in subsection 3(b) above, the Board
of Directors shall use commercially reasonable efforts to present
and recommend to the stockholders of the Company at the next annual
meeting of stockholders (to be held in accordance with the corporate
laws of Delaware, the Certificate of Incorporation and the Bylaws of
the Company) a proposal to approve such holder acquiring in excess
of 19.9% of the issued and outstanding shares of Common Stock upon
conversion of the Series G Preferred. The Corporation hereby
undertakes to present such proposal at the annual meeting of
stockholders to take place in 2002 or, if earlier, at the next
meeting of stockholders (or in the next action taken by consent of
stockholders without a meeting) other than the annual meeting of
stockholders to take place in 2001. If such approval is not obtained
at the next such meeting of the stockholders of the Corporation (or
in the next action taken by consent of stockholders without a
meeting), the Corporation shall thereafter continue to use
commercially reasonable efforts to effect such approval. In no event
may the Corporation issue more than 19.9% of the issued and
outstanding shares of Common Stock as determined in subsection 3(b)
above without obtaining such requisite vote of stockholders as set
forth herein.
(d) MECHANICS OF CONVERSION. No fractional shares of Common Stock
shall be issued upon conversion of the Series G Preferred. In lieu
of any fractional share to which a holder would otherwise be
entitled, the Corporation shall pay cash
9
equal to such fraction multiplied by the fair market value of the
Common Stock as determined by the Board of Directors. Before any
holder of the Series G Preferred shall be entitled to convert the
same into full shares of Common Stock, he shall surrender the
certificate or certificates therefor, duly endorsed, at the office
of the Corporation or of any transfer agent for the Series G
Preferred, as designated by the Corporation, and shall give written
notice to the Corporation at such office that he elects to convert
the same. The Corporation shall, as soon as practicable thereafter,
issue and deliver at such office to such holder of Series G
Preferred, a certificate or certificates for the number of shares of
Common Stock to which such holder shall be entitled as aforesaid and
a check payable to the holder in the amount of any cash amounts
payable as the result of a conversion into a fractional share of
Common Stock and, if the Corporation shall exercise the option
referred to in the last sentence of Section I(B)(1)(b), any amount
owed to such holder as the result of such exercise. Such conversion
shall be deemed to have been made immediately prior to the close of
business on the date of such surrender of the shares of Series G
Preferred to be converted, 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.
(e) NO IMPAIRMENT.
(i) The Corporation will not, by amendment of its
Certificate of Incorporation or through any reorganization,
transfer of assets, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Corporation but will at
all times in good faith assist in the carrying out of all the
provisions of this section 3 and in the taking of all such
action as may be necessary or appropriate in order to protect
the conversion rights of the holders of the Series G Preferred
against impairment.
(ii) The Corporation shall at all times reserve and keep
available for issuance upon the conversion of the Series G
Preferred a number of its authorized but unissued shares of
Common Stock that will from time to time be sufficient to
permit the conversion of all outstanding shares of Series G
Preferred, and shall take all commercially reasonable action
required to increase the authorized number of shares of Common
Stock if at any time there shall be insufficient authorized
but unissued shares of Common Stock to permit such reservation
or to permit the
10
conversion of all outstanding shares of Series G Preferred.
(f) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Series G Conversion Price pursuant
to this section 3, the Corporation, at its expense, shall promptly
compute such adjustment or readjustment in accordance with the terms
hereof and furnish to each holder of Series G Preferred a
certificate setting forth such adjustment or readjustment and
showing in detail the facts upon which such adjustment or
readjustment is based.
(g) NOTICES OF RECORD DATE. In the event that this Corporation
shall propose at any time:
(i) to declare any dividend or distribution upon its
Common Stock, whether in cash, property, stock or other
securities, whether or not a regular cash dividend and whether
or not out of earnings or earned surplus; or
(ii) to effect any reclassification or recapitalization
or other reorganization of its capital stock;
then, in connection with each such event, this Corporation shall
send to the holders of the Series G Preferred shares at least 10
days' prior written notice of the date on which a record shall be
taken for any such event setting forth a description thereof. Such
written notice shall be given by first class mail, postage prepaid,
addressed to the holders of Series G Preferred at the address for
each such holder as shown on the books of this Corporation.
(4) VOTING. Except as otherwise required by law, the holders of Series G
Preferred shall not be entitled to vote upon any matter submitted to the
stockholders for a vote except as to matters affecting holders of Series G
Preferred as a class. In addition to any other rights provided by law, so
long as any Series G Preferred shall be outstanding, this Corporation
shall not, without first obtaining the affirmative vote or written consent
of the holders of more than 50 percent of such outstanding shares of
Series G Preferred, amend or repeal any provision of, or add any provision
to, this Certificate of Designation or Bylaws if such action would alter
or change the preferences, rights, privileges or powers of, or the
restrictions provided for the benefit of, the Series G Preferred;
(5) OPTIONAL REDEMPTION. At any time after giving the holders of the
Series G Preferred ten (10) days prior written notice, (the "Redemption
Notice Date"), the
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Corporation will, within sixty (60) days of the Redemption Notice Date
(the "Redemption Date"), redeem all or any portion of the shares of Series
G Preferred, by paying in cash, out of funds legally available therefor,
at Original Series G Preferred Stock Issue Price after any adjustments for
stock splits, stock dividends, combinations, recapitalizations and similar
events. Any holder of shares of Series G Preferred may elect to convert
such shares to Common Stock by giving written notice to the Corporation
within thirty (30) days after the Redemption Notice Date and complying
with the provisions of Section 3 hereof.
(6) RESIDUAL RIGHTS. All rights accruing to the outstanding shares of
this Corporation not expressly provided for to the contrary herein, shall
be vested in the Common Stock.
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IN WITNESS WHEREOF, 5B Technologies Corporation has caused its corporate
seal to be hereunto affixed and this certificate to be signed by Glenn Nortman,
its Chief Executive Officer, this 14th day of September, 2001.
5B TECHNOLOGIES CORPORATION
By:_________________________________
Name: Glenn Nortman
Title: Chief Executive Officer
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