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ARTICLES OF AMENDMENT TO
EMN ENTERPRISES, INC.
THE UNDERSIGNED, being the president of EMN Enterprises, Inc., does
hereby amend its Articles of Incorporation, effective August 24, 1998, as
follows:
ARTICLE I
CORPORATE NAME
The name of the Corporation shall be zzap.net, Inc.
ARTICLE IV
SHARES
The capital stock of this corporation shall consist of 50,000,000
shares of common stock, $.001 par value and 5,000,000 shares of preferred
stock, no par value.
SERIES A CONVERTIBLE PREFERRED STOCK
1. Creation of Series A Convertible Stock Preferred Stock. There
is hereby created a series of preferred stock consisting of 5,000,000 shares
and designated as the Series A Convertible Preferred Stock, no par value,
having the voting powers, preferences, relative, participating, limitations,
qualifications optional and other special rights and the qualifications,
limitations and restrictions thereof that are set forth below.
2. Dividend Provisions. In the event a dividend is declared with
respect to the Company's Common Stock prior to Conversion of the Series A
Convertible Preferred Stock, upon such conversion, such dividend shall be paid
with respect to the Shares of Common Stock into which the Series A Convertible
Preferred Stock were converted. Each share of Series A Convertible Preferred
Stock shall rank on a parity with each other share of Series A Convertible
Preferred Stock with respect to dividends.
3. Redemption Provisions. Each share of the Series A Convertible
Preferred Stock is redeemable on the following manner, at a price of $8.00 per
Share (the "Redemption Price"). The Holder of the Preferred Stock and the
Corporation shall have the right to redeem each Share within 72 hours after the
Notice of Redemption is given by a Holder or the Corporation with respect to
such Shares. The Corporation shall effect such redemption by payment to the
Holder by wire transfer or certified check payable to the Holder on or before
the Redemption Date, which shall be the later of (i) the tenth calendar after
the Notice of Conversion or (ii) the date on which the Holder has delivered the
certificates representing the Preferred Stock proposed to be converted
pursuant. In the event the Corporation shall not make such payment it shall be
deemed to have waived its right to redemption as to those Shares. The
Corporation shall have the right to redeem less than all of the Shares which
are the subject of the Notice of Conversion.
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4. Liquidation Provisions. In the event of any liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
the Series A Convertible Preferred Stock shall be entitled to receive an amount
equal to $3.00 per share. After the full preferential liquidation amount has
been paid to, or determined and set apart for the Series A Convertible
Preferred Stock and all other series of Preferred Stock hereafter authorized
and issued, if any, the remaining assets of the Corporation available for
distribution to shareholders shall be distributed ratably to the holders of the
common stock. In the event the assets of the Corporation available for
distribution to its shareholders are insufficient to pay the full preferential
liquidation amount per share required to be paid the Corporation's Series A
Convertible Preferred Stock, the entire amount of assets of the Corporation
available for distribution to shareholders shall be paid up to their respective
full liquidation amounts first to the Series A Convertible Preferred Stock,
then to any other series of Preferred Stock hereafter authorized and issued,
all of which amounts shall be distributed ratably among holders of each such
series of Preferred Stock, and the common stock shall receive nothing. A
reorganization, or any other consolidation or merger of the Corporation with or
into any other corporation, or any other sale of all or substantially all of
the assets of the Corporation, shall not be deemed to be a liquidation,
dissolution or winding up of the Corporation within the meaning of this Section
4, and the Series A Convertible Preferred Stock shall be entitled only to (i)
the right provided in any agreement or plan governing the reorganization or
other consolidation, merger or sale of assets transaction, (ii) the rights
contained in the Florida Business Corporation Act and (iii) the rights
contained in other Sections hereof.
5. Conversion Provisions. The holders of shares of Series A
Convertible Preferred Stock shall have conversion rights as follows (the
"Conversion Rights"):
(a) Right to Convert - Option of Holder. Subject to Section 5(h)
hereof each share of Series A Convertible Preferred Stock (the
"Preferred Shares") shall be convertible, at the option of its holder,
at any time, into shares of common stock of the Company (the "Common
Stock") at the conversion rate. The conversion rate shall be increased
proportionally for any reverse stock split and decreased
proportionally for any forward stock split or stock dividend.
(b) No fractional shares of Common Stock shall be issued upon
conversion of the Preferred Shares, and in lieu thereof the number of
shares of Common Stock issuable for each Preferred Share converted
shall be rounded to the nearest whole number. Such number of whole
shares of Common Stock issuable upon the conversion of one Preferred
Share shall be multiplied by the number of Preferred Shares submitted
for conversion pursuant to the Notice of Conversion (defined below) to
determine the total number of shares of Common Stock issuable in
connection with any conversion.
(c) In order to convert the Preferred Shares into shares of Common
Stock, the holder of the Preferred Shares shall: (i) complete, execute
and deliver to the Corporation the conversion certificate set forth in
Section 5 (f) hereto (the "Notice of Conversion"); and (ii) surrender
the certificate or certificates representing the Preferred Shares
being converted (the "Converted Certificate") to the Corporation. The
Notice of Conversion
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shall be effective and in full force and effect if delivered to the
Corporation by facsimile transmission. Provided that a copy of the
Notice of Conversion is delivered to the Corporation on such date by
facsimile transmission or otherwise, and provided that the original
Notice of Conversion and the Converted Certificate are delivered to
the Corporation within three (3) business days thereafter at the
Corporation's principal place of business, the date on which notice of
conversion is given (the "Conversion Date") shall be deemed to be the
date set forth therefor in the Notice of Conversion; and the person or
persons entitled to receive the shares of Common Stock issuable upon
conversion shall be treated for all purposes as the record holder or
holders of such shares of Common Stock as of the Conversion Date. If
the original Notice of Conversion and the Converted Certificate are
not delivered to the Corporation within three (3) business days
following the Conversion Date, the Notice of Conversion shall become
null and void as if it were never given and the Corporation shall,
within two (2) business days thereafter, return to the holder by
overnight courier any Converted Certificate that may have been
submitted in connection with any such conversion.
(d) Upon receipt of a Notice of Conversion, the Corporation shall
absolutely and unconditionally be obligated to cause a certificate or
certificates representing the number of shares of Common Stock to
which a converting holder of Preferred Shares shall be entitled as
provided herein, which shares shall constitute fully paid and
nonassessable shares of Common Stock to be issued to, delivered by
overnight courier to, and received by such holder by the fifth (5th)
calendar day following the Conversion Date unless the Company has duly
redeemed the Preferred Shares which are the subject of the Notice of
Conversion in accordance with Section 3 hereof. Such delivery shall be
made at such address as such holder may designate therefor in its
Notice of Conversion or in its written instructions submitted together
therewith.
(e) Intentionally omitted.
(f) The Notice of Conversion shall be in substantially the
following form:
"The undersigned holder (the "Holder") is
surrendering to The Havana Republic, Inc., a Florida
corporation (the "Company"), one or more certificates
representing shares of Series A Convertible Preferred Stock
of the Company (the "Preferred Stock") in connection with the
conversion of all or a portion of the Preferred Stock into
shares of Common Stock, no par value per share, of the
Company (the "Common Stock") as set forth below.
1. The Holder understands that the Preferred Stock were
issued by the Company pursuant to the exemption from
registration under the United States Securities Act of 1933,
as amended (the "Securities Act"), provided by Regulation D
and/or Section 4(2) thereunder promulgated thereunder.
2. The Holder represents and warrants that all offers
and sales of the Common Stock issued to the Holder upon such
conversion of the Preferred Stock shall be made (a) pursuant
to an effective registration statement under the
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Securities Act, (in which case a prospectus has been
delivered to the purchaser) (b) in compliance with Rule 144,
or (c) pursuant to some other exemption from registration.
Number of Shares of Preferred Stock being converted:
Number of Shares of Common Stock issuable:
Conversion Date:
Delivery Instructions for certificates of Common Stock and
for new certificates representing any remaining shares of
Preferred Stock:
NAME OF HOLDER:
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(Signature of Holder)
(b) ADJUSTMENTS TO CONVERSION RATE. (1) RECLASSIFICATION, EXCHANGE
AND SUBSTITUTION. If the Common Stock issuable on conversion of the
Series A Convertible Preferred Stock shall be changed into the same or
a different number of shares of any other class or classes of stock,
whether by capital reorganization, reclassification, reverse stock
split or forward stock split or stock dividend or otherwise (other
than a subdivision or combination of shares provided for above), the
holders of the Series A Convertible Preferred Stock shall, upon its
conversion, be entitled to receive, in lieu of the Common Stock which
the holders would have become entitled to receive but for such change,
a number of shares of such other class or classes of stock that would
have been subject to receipt by the holders if they had exercised
their rights of conversion of the Series A Convertible Preferred Stock
immediately before that change.
(2) REORGANIZATIONS, MERGERS, CONSOLIDATION OR SALE OF ASSETS. If
at any time there shall be a capital reorganization of the
Corporation's common stock (other than a subdivision, combination,
reclassification or exchange of shares provided for elsewhere in this
Section (5) or merger of the Corporation into another corporation, or
the sale of the Corporation's properties and assets as, or
substantially as, an entirety to any other person, then, as a part of
such reorganization, merger or sale, lawful provision shall be made so
that the holders of the Series A Convertible Preferred Stock shall
thereafter be entitled to receive upon conversion of the Series A
Convertible Preferred Stock, the number of shares of stock or other
securities or property of the Corporation, or of the successor
corporation resulting from such merger, to which holders of the Common
Stock deliverable upon conversion of the Series A Convertible
Preferred Stock would have been entitled on such capital
reorganization, merger or sale if the Series A
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Convertible Preferred Stock had been converted immediately before that
capital reorganization, merger or sale to the end that the provisions
of this paragraph (b)(2) (including adjustment of the Conversion Rate
then in effect and number of shares purchasable upon conversion of the
Series A Convertible Preferred Stock) shall be applicable after that
event as nearly equivalently as may be practicable.
(c) NO IMPAIRMENT. The Corporation will not, by amendment of its
Articles of Incorporation or through any reorganization,
recapitalization, transfer of assets, merger, dissolution, 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 provision of this Section 5 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 A
Convertible Preferred Stock against impairment.
(d) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Conversion Rate for any shares of
Series A Convertible Preferred Stock, the Corporation at its expense
shall promptly compute such adjustment or readjustment in accordance
with the terms hereof and prepare and furnish to each holder of Series
A Convertible Preferred Stock effected thereby a certificate setting
forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based. The Corporation
shall, upon the written request at any time of any holder of Series A
Convertible Preferred Stock, furnish or cause to be furnished to such
holder a like certificate setting forth (i) such adjustments and
readjustments, (ii) the Conversion Rate at the time in effect, and
(iii) the number of shares of Common Stock and the amount, if any, of
other property which at the time would be received upon the conversion
of such holders shares of Series A Convertible Preferred Stock.
(e) NOTICES OF RECORD DATE. In the event of the establishment by
the Corporation of a record of the holders of any class of securities
for the purpose of determining the holders thereof who are entitled to
receive any dividend (other than a cash dividend) or other
distribution, the Corporation shall mail to each holder of Series A
Preferred Stock at least twenty (20) days prior to the date specified
therein, a notice specifying the date on which any such record is to
be taken for the purpose of such dividend or distribution and the
amount and character of such dividend or distribution.
(f) RESERVATION OF STOCK ISSUABLE UPON CONVERSION. The Corporation
shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock solely for the purpose of
effecting the conversion of the shares of the Series A Convertible
Preferred Stock such number of its shares of Common Stock as shall
from time to time be sufficient, based on the Conversion Rate then in
effect, to effect the conversion of all then outstanding shares of the
Series A Preferred Stock. If at any time the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the
conversion of all then outstanding shares of the Preferred Stock,
then, in addition to all rights, claims and damages to which the
holders of the Series A Convertible Preferred Stock shall be entitled
to receive at law or in equity as a result of
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such failure by the Corporation to fulfill its obligations to the
holders hereunder, the Corporation will take any and all Corporate or
other action as may, in the opinion of its counsel, be helpful,
appropriate or necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient
for such purpose.
(g) NOTICES. Any notices required by the provisions hereof to be
given to the holders of shares of Series A Convertible Preferred Stock
shall be deemed given if deposited in the United States mail, postage
prepaid and return receipt requested, and addressed to each holder of
record at its address appearing on the books of the Corporation or to
such other address of such holder or its representative as such holder
may direct.
(h) MANDATORY CONVERSION. All outstanding shares of Series A
Convertible Preferred Stock (not sooner converted into Common Stock)
shall be mandatorily convertible into Common Stock two years from the
issuance of the Preferred stock.
6. VOTING PROVISIONS. Except as otherwise expressly provided or
required by law, the Series A Convertible Preferred Stock shall have no voting
rights.
I hereby certify that the following was adopted by a majority vote of
the shareholders and directors of the corporation on August 24, 1998 and that
the number of votes cast was sufficient for approval.
IN WITNESS WHEREOF, I have hereunto subscribed to and executed this
Amendment to Articles of Incorporation this on August 24, 1998.
/s/ Rene M. Hamouth
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Rene Hamouth, President
The foregoing instrument was acknowledged before me on August 24,
1998, by Rene Hamouth, who is personally known to me.
/s/ (signature unreadable)
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Notary Public
My commission
does not expire -
Barrister-Solicitor
