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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 C Redeemable
Convertible Preferred Stock (the "Series C Designation"), filed on November 6,
1997 and amended on December 12, 1997 (and as so amended, the "Series C
Certificate"), is hereby further amended as follows:
A. Paragraph 2 of the Series C Designation,
attached as Exhibit "A" to the Series C Certificate, is hereby amended
to read in full as follows:
(a) Payment of Dividends. The holders of
record of shares of Series C Preferred Stock are
entitled to a non-cumulative noncompounded dividend
as set forth below, 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
redemption of the Series C Preferred Stock.
(b) Special Dividends. Dividends on the
Series C Preferred Stock shall be at the rate of the
20% per annum through May 3, 1999 (the "Early
Redemption Period"), payable on the earlier of (i)
the last day of the Early Redemption Period and (ii)
the redemption of the shares of Series C Preferred
Stock. The dividend paid during the Early Redemption
Period is hereinafter referred to as the "Special
Dividend." In the event of a redemption during the
Early Redemption Period, the Special Dividend shall
nevertheless be paid for a period of not less than
six (6) months notwithstanding that the redemption
occurs after less than six (6) months from the date
of initial issuance. The Special Dividend may be paid
in cash or, at the election of the Company, by
delivery of additional shares of Common Stock having
an aggregate "Market Value" (as hereinafter defined)
equal to the amount of such dividend. For purposes of
payment of the Special Dividend, 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(c) for the ten (10)
consecutive trading days preceding the dividend
payment date.
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(c) After the Early Redemption Period,
dividends on the Series C Preferred Stock shall be at
the rate of 8% per annum, payable (when and if
declared by the Company's Board of Directors),
semi-annually by the Company, on June 30th and
December 31st of each year. All dividends paid after
the Early Redemption Period may be paid in cash or,
at the election of the Company, by delivery of
additional shares of Common Stock having an aggregate
"Market Value" (as defined in subparpagraph (b)
above) equal to the amount of such dividend.
B. Paragraph 9 of the Series C Designation is
hereby amended to read in full as follows:
"9. Series C Special Redemption.
(a) Subject to subsection (e) hereof; each
holder of Series C Preferred Stock shall
have the right to require the redemption of
a portion or all of its Series C Preferred
Stock upon a Series C Redemption Event (as
hereinafter defined) and in the Series C
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 C Redemption
Event the Company shall mail a notice (the
"Series C Redemption Notice") to each holder
of record of the Series C Preferred Stock
stating:
A: The Series C Redemption Amount; and
B: (i) that a Series C Redemption Event has occurred, that the
Series C Redemption Event Offer limited to the Series C Redemption
Amount is being made pursuant to the terms of the Series C Preferred
Stock and that all shares of Series C Preferred Stock validly tendered
and not in excess of the Series C Redemption Amount will be accepted
for redemption. If more than one registered owner of Series C Preferred
Stock at the time of any Series C Redemption Event Offer tenders stock
for redemption, Series C Preferred Stock shall be accepted for
redemption only in the same proportions in which those submitting
Series C Preferred Stock share ownership of it;
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(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 C Redemption
Date");
(iii) that any shares of Series C Preferred Stock
not tendered will continue to accumulate dividends;
(iv) that, unless the Company defaults in the payment
of the Series C Preferred Stock redemption price, any shares of Series
C Preferred Stock accepted for redemption pursuant to the Series C
Redemption Event Offer shall cease to accumulate dividends after the
Series C Redemption Date;
(v) that holders whose shares of Series C Preferred
Stock are being redeemed only in part will be issued new certificates
representing shares of Series C Preferred Stock equal in number to the
unredeemed portion of the shares of Series C Preferred Stock
surrendered; provided that each certificate representing shares of
Series C Preferred Stock redeemed and each new certificate representing
shares of Series C Preferred Stock issued shall be in whole shares.
(c) On or about the Series C Redemption Date:
(i) the transfer agent for the Series C Preferred
Stock shall deliver to the Company a certificate specifying the
aggregate number of shares of Series C Preferred Stock delivered for
purchase by the holders of Series C Preferred Stock prior to the Series
C Redemption Date pursuant to the Series C Redemption Offer;
(ii) The Company shall accept for redemption
shares of Series C Preferred Stock or portions thereof so accepted; and
(iii) The Company shall deposit with the transfer
agent for the Series C Preferred Stock money sufficient to pay the
redemption price of all shares of Series C 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 C Preferred Stock an
officers' certificate specifying the shares of Series C Preferred Stock
or portions thereof accepted for payment by the Company.
(d) The transfer agent for the Series C
Preferred Stock shall promptly mail to the
holders of Series C Preferred Stock so
accepted payment in an amount equal to the
Series C Preferred Stock redemption price,
and the transfer agent for the Series C
Preferred Stock shall promptly authenticate
and mail to such holders of Series C
Preferred Stock a new certificate
representing shares of Series C Preferred
Stock equal in number to any unredeemed
shares of Series C Preferred Stock
surrendered; provided that each share of
Series C Preferred Stock redeemed and each
new certificate representing shares of
Series C Preferred Stock issued shall be in
whole shares. The Company will notify the
holders of Series C Preferred Stock of the
results of the Series C Redemption Event
Offer on or as soon as practicable after the
Series C Redemption Date.
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(e) Series C Redemption Event shall mean each
instance in which the Series C Security
Account exceeds the Series C Redemption
Amount, provided however, that such Series C
Redemption Event shall cease whenever the
Company shall mail a Series C Redemption
Notice to each holder of record of the
Series C Preferred Stock as hereinabove
provided.
(f) Series C Redemption Amount shall mean the
amount, not less than $1,000,000 except as
specified hereinafter upon termination of
the Series C Security Account, and not
exceeding $6,200,000 in the aggregate, of
cash and cash equivalent property held by or
for the credit of the Series C Security
Account in excess of any reasonable reserve
for the payment of fees and expenses of such
Security Account. The Company maintains the
Series C Security Account to secure and as a
method of funding the Series C Redemptions
upon Series C 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 C Security Account
in accordance with the terms of the Security
Agreement, any amounts remaining in such
Series C Security Account shall be deemed a
Series C Redemption Amount and accordingly
shall be applied to fund Series C
Redemptions.
C. A new paragraph 12 is added to the Series C
Designation, to read in full as follows:
12. Notwithstanding anything to the contrary
contained in this certificate, no redemption of
Series C Preferred Stock shall be permitted except in
compliance with N.J. Business Corporation Act, Sec.
14-7-14.1. Any proposed redemption of the Series C
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 the redemption may be made in compliance
with such statute.
The Series C Certificate is hereby further amended as follows:
A. A new paragraph 5 is added to the Series C
Certificate as follows:
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"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
Corporation relating to a Certificate of Designations
of Rights and Preferences of Series C Exchangeable
Redeemable Preferred Stock filed on November 6, 1997,
as amended on December 12, 1997."
B. A new paragraph 6 is added to the Series C
Certificate immediately following paragraph 5 and preceding
the resolution, as follows:
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 7 is added to the Series C
Certificate immediately after new paragraph 6 and preceding
the resolution as follows:
The resolution referred to in Paragraph 6 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 C
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.
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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 C Preferred
Stock and is set forth below:
RESOLVED, that the Certificate of Amendment and the
Certificate of Designations of Rights and Preferences of
Series C Exchangeable Redeemable Preferred Stock filed on
November 6, 1997, as amended December 12, 1997, is confirmed
in all respects and is incorporated herein by reference ,
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
