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FEDERAL EMPLOYER IDENTIFICATION NO. 22-2603175
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION
OF
COMPOST AMERICA HOLDING COMPANY, INC.
Pursuant to the provision of Section 14A:7-2, of the New Jersey
Business Corporation Act, the undersigned corporation executes the following
Certificate of Amendment to Certificate of Incorporation:
1. The name of the corporation is:
Compost America Holding Company, Inc.
2. The following amendment to the Certificate of Incorporation
was approved by the directors of the corporation on the 23rd
day of March, 2000:
The Certificate of Amendment to the Certificate of Incorporation of
Compost America Holding Company, Inc. relating to the Certificate of
Designations of Rights and Preferences of Series A Exchangeable Redeemable
Preferred Stock (the "Series A Designation"), filed on November 6, 1997, as
amended on December 12, 1997 and June 15, 1998 (and as so amended, the "Series A
Certificate"), is hereby further amended as follows:
A. Paragraph 2 of the Series A Designation, attached as Exhibit
"A" to the Series A Certificate, is hereby amended to read in full as
follows:
2. Cumulative Dividends; Priority.
(a) The holders of record of shares of Series A Preferred
Stock are entitled to a cumulative noncompounded dividend
equal to 8% per annum, payable when declared by the Company's
Board of Directors, and, except for any redemption provided in
that certain Sharing Agreement dated March 31, 2000 by and
among the Company, Wasteco Ventures Limited and Robert J.
Longo, as amended (the "Sharing Agreement"), upon any exchange
or redemption of the Series A Preferred Stock. Dividends shall
be payable semi-annually by the Company on June 30th and
December 31st of each year. Through November 3, 2004,
dividends on the Series A Preferred Stock may be paid either
in cash or, at the election of the Company, by delivery of
additional shares of Common Stock having an aggregate "Market
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Value" (as hereinafter defined) equal to the amount of such
dividend, or in any combination of cash and shares of Common
Stock. For purposes of dividend payments, each share of Common
Stock will be deemed to have a "Market Value" equal to ninety
percent (90%) of the "Average Share Price" as defined in
Section 5(a) for the ten (10) consecutive trading days
preceding the dividend payment date. Dividends on shares of
the Series A Preferred Stock will be cumulative on a daily
basis from the date of initial issuance of such shares of
Series A Preferred Stock. Dividends will be payable, in
arrears, to holders of record as they appear on the stock
books of the Company on such record dates, not more than 60
days nor less than 10 days preceding the payment dates
thereof, as shall be fixed by the Board of Directors. The
amount of dividends payable for each full dividend period
shall be computed by dividing the annual dividend payment by
two. The amount of dividends payable for the initial dividend
period or any period shorter or longer than a full dividend
period shall be calculated on the basis of a 360-day year of
twelve 30-day months. No dividends may be declared or paid or
set apart for payment on any parity stock with regard to the
payment of dividends unless there shall also be or have been
declared and paid or set apart for payment on the Series A
Preferred Stock, like dividends for all dividend payment
periods of the Series A Preferred Stock ending on or before
the dividend payment date of such parity stock, ratably in
proportion to the respective amounts of dividends (x)
accumulated and unpaid or payable on such parity stock, on the
one hand, and (y) accumulated and unpaid through the dividend
payment period or periods of Series A Preferred Stock next
preceding such dividend payment date, on the other hand.
Except as set forth in the preceding sentence, unless full
cumulative dividends on the Series A Preferred Stock have been
paid, no dividends (other than in Common Stock of the Company)
may be paid or declared or set aside for payment or other
distribution made upon the Common Stock or any other Junior
Stock of the Company or on a parity with the Series A
Preferred Stock as to dividends, nor may any Common Stock or
any other Junior Stock or parity stock of the Company, except
as provided in the Sharing Agreement, be redeemed, purchased
or otherwise acquired for any consideration (or any payment be
made to or available for a sinking fund for the redemption of
any shares of such stock); provided, that any such Junior
Stock or parity stock may be converted into or exchanged for
stock of the Company ranking junior to the Series A Preferred
Stock as to dividends."
B. Paragraph 9 of the Series A Designation is hereby amended to
read in full as follows:
9. Series A Special Redemption.
(a) Subject to subsection (e) hereof; each holder of Series
A Preferred Stock shall have the right to require the
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redemption of a portion or all of its Series A Preferred Stock
upon a Series A Redemption Event (as hereinafter defined) and
in the Series A Redemption Amount (hereinafter defined) at a
price equal to $100 per share plus a sum equal to all cash
dividends accrued and unpaid to the Redemption Date and any
stock dividends accrued and unpaid to such date.
(b) Within 30 days of a Series A Redemption Event the
Company shall mail a notice (the "Series A Redemption Notice")
to each holder of record of the Series A Preferred Stock
stating:
A: The Series A Redemption Amount; and
B: (i) that a Series A Redemption Event has occurred, that
the Series A Redemption Event Offer limited to the Series A
Redemption Amount is being made pursuant to the terms of
the Series A Preferred Stock and that all shares of Series
A Preferred Stock validly tendered and not in excess of the
Series A Redemption Amount will be accepted for redemption.
If more than one registered owner of Series A Preferred
Stock at the time of any Series A Redemption Event Offer
tenders stock for redemption, Series A Preferred Stock
shall be accepted for redemption only in the same
proportions in which those submitting Series A Preferred
Stock share ownership of it;
(ii) the redemption price and the date of redemption
(which shall be a business day no earlier than 30 days not
later than 60 days from the date such notice is mailed)
(the "Series A Redemption Date");
(iii) that any shares of Series A Preferred Stock not
tendered will continue to accumulate dividends;
(iv) that, unless the Company defaults in the payment
of the Series A Preferred Stock redemption price, any
shares of Series A Preferred Stock accepted for redemption
pursuant to the Series A Redemption Event Offer shall cease
to accumulate dividends after the Series A Redemption Date;
(v) that holders whose shares of Series A Preferred
Stock are being redeemed only in part will be issued new
certificates representing shares of Series A Preferred
Stock equal in number to the unredeemed portion of the
shares of Series A Preferred Stock surrendered; provided
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that each certificate representing shares of Series A
Preferred Stock redeemed and each new certificate
representing shares of Series A Preferred Stock issued
shall be in whole shares.
(c) On or about the Series A Redemption Date:
(i) the transfer agent for the Series A Preferred Stock
shall deliver to the Company a certificate specifying the
aggregate number of shares of Series A Preferred Stock
delivered for purchase by the holders of Series A Preferred
Stock prior to the Series A Redemption Date pursuant to the
Series A Redemption Offer;
(ii) The Company shall accept for redemption shares of
Series A Preferred Stock or portions thereof so accepted;
and
(iii) The Company shall deposit with the transfer agent
for the Series A Preferred Stock money sufficient to pay
the redemption price of all shares of Series A Preferred
Stock or portions thereof accepted for payment by the
Company.
(iv) The Company shall deliver, or cause to be
delivered, to the transfer agent for the Series A Preferred
Stock an officers' certificate specifying the shares of
Series A Preferred Stock or portions thereof accepted for
payment by the Company.
(d) The Series A Preferred Stock transfer agent shall
promptly mail to the holders of Series A Preferred Stock so
accepted payment in an amount equal to the Series A Preferred
Stock redemption price, and the transfer agent for the Series
A Preferred Stock shall promptly authenticate and mail to such
holders of Series A Preferred Stock a new certificate
representing shares of Series A Preferred Stock equal in
number to any unredeemed shares of Series A Preferred Stock
surrendered; provided that each share of Series A Preferred
Stock redeemed and each new certificate representing shares of
Series A Preferred Stock issued shall be in whole shares. The
Company will notify the holders of Series A Preferred Stock of
the results of the Series A Redemption Event Offer on or as
soon as practicable after the Series A Redemption Date.
(e) Series A Redemption Event shall mean each instance in
which the Series A Security Account exceeds the Series A
Redemption Amount, provided however, that such Series A
Redemption Event shall cease whenever the Company shall mail a
Series A Redemption Notice to each holder of record of the
Series A Preferred Stock as hereinabove provided.
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(f) Series A Redemption Amount shall mean the amount, not
less than $1,000,000 except as specified hereinafter upon
termination of the Series A Security Account, and not
exceeding $3,000,000 in the aggregate, of cash and cash
equivalent property held by or for the credit of the Series A
Security Account in excess of any reasonable reserve for the
payment of fees and expenses of such Security Account. The
Company maintains the Series A Security Account to secure and
as a method of funding the Series A Redemptions upon Series A
Redemption Events. Such Account is maintained pursuant to a
security agreement (the "Security Agreement") as required by
the Sharing Agreement. Upon termination of the Series A
Security Account in accordance with the terms of the Security
Agreement, any amount remaining in such Series A Security
Account immediately prior to such termination shall be deemed
a Series A Redemption Amount and accordingly shall be applied
to fund Series A Redemptions.
C. A new paragraph 11 is added to the Series A Designation, to
read in full as follows:
11. Notwithstanding anything to the contrary contained in this
certificate, no redemption of Series A Preferred Stock shall be
permissible except in compliance with N.J. Business Corporation
Act, Sec. 14-7-14.1. Any proposed redemption of the Series A
Preferred Stock authorized herein shall be reduced in an amount
to effect compliance with such statute, or if such reduction is
not feasible, deferred until such time as a Series A Redemption
Event Offer may be made in compliance with such statute.
The Series A Certificate is hereby further amended as follows:
A. A new paragraph 8 is added to the Series A Certificate as
follows:
"Pursuant to the provisions of Section 14A:7-2(2) of the New
Jersey Business Corporation Act, the undersigned corporation
executes the following Certificate of Amendment to the
Certificate of Incorporation relating to a Certificate of
Designations of Rights and Preferences of Series A Exchangeable
Redeemable Preferred Stock filed on November 6, 1997, as amended
on December 12, 1997 and June 15, 1998."
B. A new paragraph 9 is added to the Series A Certificate
immediately following paragraph 8 and preceding the resolution, as
follows:
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The Certificate of Incorporation is further amended so that the
relative rights, preferences and limitations of each class and
series acted upon in the resolution are as stated in the
resolution.
C. A new paragraph 10 is added to the Series A Certificate
immediately after new paragraph 9 and preceding the resolution as
follows:
The resolution referred to in paragraph 9 is the resolution of
the Board dated March 23, 2000 setting forth its actions and
stating the relative rights, preferences and limitations of the
shares of Series A Exchangeable Redeemable Preferred Stock
thereby created and is set forth below.
This Certificate of Incorporation is amended so that the relative
rights, preferences and limitations of each class and series acted upon in
the resolution, are as stated in the resolution.
The resolution referred to in the immediately preceding paragraph was
adopted by the Board of Directors on March 23, 2000, and is the resolution of
the Board setting forth the actions and stating the relative rights, preferences
and limitations of the shares of Series A Preferred Stock and is set forth
below:
RESOLVED, that the Certificate of Amendment and the Certificate
of Designations of Rights and Preferences of Series A Exchangeable
Redeemable Preferred Stock filed on November 6, 1997, as amended
December 12, 1997 and June 15, 1998, is confirmed in all respects and
is incorporated herein by reference;
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subject, however, to the further amendments set forth in the
Certificate of Amendment dated June 14, 2000 and the Board authorizes
the filing with the Secretary of State of the State of New Jersey of
such Certificate of Amendment.
Dated this 14th day of June, 2000.
COMPOST AMERICA HOLDING COMPANY, INC.
BY: _________________________________
Marvin Roseman
Office of the President
BY: _________________________________
Chris Daggett
Office of the President
BY: _________________________________
Richard Franks
Assistant Secretary
