UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. 2)
Under the Securities Exchange Act of 1934
Pure Cycle Corporation
(Name of Issuer)
Common Stock, Par Value 1/3 of $.01
(Title of Class of Securities)
746228 10 5
(CUSIP Number)
Thomas P. Clark 5650 York Street Commerce City, CO 80022 (303) 292-3456
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
September 7, 1999
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g),
check the following box. ?
Note: Schedules filed in paper format shall include a signed original and
five copies of the sschedule, including all exhibits. See Rule 13d-7(b)
for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities
of that section of the Act but shall be subject to all other provisions of
the Act (however, see the Notes).
1 NAMES OF REPORTING PERSONS S.S. OR
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Thomas P. Clark
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
Not Applicable (b)
3 SEC USE ONLY
4 SOURCE OF FUNDS
Not applicable
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQURIED ?
PURSUANT TO ITEMS 2(d) or 2(e)
Not Applicable
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7 SOLE VOTING POWER
27,264,854
8 SHARED VOTING POWER
0
9 SOLE DISPOSITIVE POWER
27,264,854
10 SHARED DISPOSITIVE POWER
27,264,854
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
27,264,854
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES ?
Not applicable
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
32.9%
14 TYPE OF REPORTING PERSON
IN
Item 1. Security and Issuer.
This Schedule 13D is filed with respect to shares of Common Stock, 1/3 of
$.01 par value ("Common Stock"), of Pure Cycle Corporation, a Delaware
corporation (the "Company"). The Company's principal executive offices
are located at 5650 York Street, Commerce City, Colorado 80022.
The names and addresses of the principal executive officers of the
Company are as follows:
Name Title Address
Thomas P. Clark President, Treasurer 5650 York St.
Commerce City, CO 80022
Mark W. Harding CFO, Secretary 5650 York St.
Commerce City, CO 80022
Item 2. Identity and Background.
(a), (b) and (c). This Schedule 13D is being filed by Thomas P. Clark
("Clark"), whose business address is 5650 York Street, Commerce City, CO
80022. The principal occupation of Clark is his employment as President and
Treasurer of the Company. The address of the Company's executive offices
is set forth in Item 1 above.
(d) and (e). Clark has not, during the last five years, been (i) convicted in
a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (ii) a party to a civil proceeding of a judicial or administrative body
of a competent jurisdiction as a result of which he was or is subject to a
judgement, decree or final order enjoining future violations of or
prohibiting activities subject to, federal or state securities laws or
finding any violation with respect to such laws.
(f) Clark is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
Not applicable
Item 4. Purpose of Transaction.
Except as described below Clark has no present plans or proposals that
relate to or would result in any transaction of the kind described in
paragraphs (a) through (j) of Item 4. In the future, however, Clark
reserves the right to adopt such plans or proposals, subject to applicable
regulatory requirements, if any.
Pursuant to an Amended and Restated Voting Agreement dated August
12, 1992, a copy of which was filed previously as Exhibit A to Amendment
No 1 (the "1992 Voting Agreement") Clark has agreed along with other
parties to vote his shares of the Company's Common Stock in favor of
electing a representative designated by The Environmental Private Equity
Fund II, L.P., a Delaware limited partnership ("EP Fund"), to the Company's
Board of Directors. EP Fund owns 7,142,320 shares of Common Stock of the
Company, 600,000 shares of Series A-1 Preferred Stock of the Company
which are convertible into 3,333,333 shares of Common Stock. Companies
affiliated with EP Fund who are parties to the 1992 Voting Agreement (the
"EP Fund Entities") own an additional 27,814,527 shares of Common
Stock, 408,000 shares of Series A-1 Preferred Stock which are convertible
into 2,266,667 shares of Common Stock and warrants to acquire an additional
1,000,000 shares of Common Stock. Assuming the exercise of all warrants by
the EP Fund Entities, but no exercise of warrants and options held by any
other persons, the EP Fund Entities own approximately 36.7% of the
Company's Common Stock. George M. Middlemas currently serves on the Board
and was elected as the EP Fund representative.
Pursuant to a Voting Agreement dated December 11, 1990, a copy of which was
filed previously as Exhibit B to Amendment No. 1 (the "1990 Voting
Agreement"), Clark has agreed along with other parties to vote his shares
of the Company's Common Stock in favor of electing a representative
designated by Inco Securities Corporation, a Delaware corporation ("Inco"),
to the Company's Board of Directors. Inco owns warrants to acquire
4,700,000 shares of Common Stock. Assuming the exercise of all warrants
held by Inco which are currently exercisable and no exercise of warrants and
option held by any other persons, Inco owns approximately 5.7% of the
Company's Common Stock. Richard L. Guido currently serves on the Board
and was elected as the Inco representative.
Item 5. Interest in Securities of the Issuer.
(a) Clark beneficially owns 27,264,854 shares of Common Stock
which is 32.9% of the outstanding and issued Common Stock of the Company.
Clark owns 22,898,187 shares of Common Stock and 4,366,667 shares of
Convertible Voting Preferred Stock as described in (c) below.
Although Clark is a party to certain voting agreements more speficically
described in Item 4, Clark disclaims beneficial ownership of all shares of
Common Stock owned by the other parties to those agreements and disclaims
the existence of a "group" within the meaning of Section 13(d)(3) of the
Securities Exchange Act of 1934.
(b) Clark has sole power to dispose of 27,264,854 shares of Common
Stock, subject to the 1990 Voting Agreement, which currently requires
Clark to obtain Inco's consent because he and the other parties to that
agreement currently own less than 50% of the outstanding stock, and subject
to the 1992 Voting Agreement, which requires Clark to obtain consent for
dispositions unless the transferee agrees to be bound by the 1992 Voting
Agreement or the disposition is pursuant to an agreement in effect on
August 12, 1992. Subject to the terms and conditions of the 1992 Voting
Agreement and the 1990 Voting Agreement, Clark has the sole power to vote
27,264,854 shares of Common Stock.
(c) On August 3, 1998, January 5, 1999 and September 7, 1999, Clark
transferred 3,200,000, 500,000, and 666,667 shares of Common Stock to
the Company, respectively in exchange for 3,200,000 shares of Series C
Preferred Stock, 500,000 shares of Series C-1 Preferred Stock, and 666,667
shares of Series C-2 Preferred Stock respectively. The Series C, Series
C-1 and Series C-2 Preferred Stock are convertible into 3,200,000, 500,000
and 666,667 shares of Common Stock, respectively, and have the right to
vote with the Common Stock on all matters presented to the stockholders of
the Company.
(d) None.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
See Item 5(b) above for a description of the 1992 Voting Agreement and the
1990 Voting Agreement.
Clark has pledged the following shares to the following entity as security
for loans to the Company.
LCH Inc. 20,000,000
A default by the Company of the terms of such loan could result in a loss of
those shares.
Clark sold the following shares to the following persons and has the right
to reacquire such shares in the event such persons are paid a specified
amount by the Company as a result of their investments in the Company's
Rangeview water supply.
Amount to be
Paid from
Potential Transferor Shares Rangeview Project
Beverly A. Beardslee 500,000 shares $100,000
Bradley K. Beardslee 250,000 shares $50,000
Robert D. Beardslee 250,000 shares $50,000
Item 7. Material to Be Filed as Exhibits.
Exhibit A Certificate of the Designations, Powers, Preferences and Rights
of Series C Convertible Preferred Stock dated August 3, 1998.
Exhibit B Certificate of the Designations, Powers, Preferences and Rights
of Series C-1 Convertible Preferred Stock dated January 5, 1999.
Exhibit C Certificate of the Designations, Powers, Preferences and Rights
of Series C-2 Convertible Preferred Stock dated September 7, 1999.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: February 16, 2000 Pure Cycle Corporation
By:
(Thomas P. Clark, President)
Attention: Intentional misstatements or
omissions of fact constitute Federal
criminal violations (See 18 U.S.C. 1001)
EXHIBIT INDEX
Exhibit A Certificate of the Designations, Powers, Preferences and Rights of
Series C Convertible Preferred Stock dated August 3, 1998.
Exhibit B Certificate of the Designations, Powers, Preferences and Rights of
Series C-1 Convertible Preferred Stock dated January 5, 1999.
Exhibit C Certificate of the Designations, Powers, Preferences and Rights of
Series C-2 Convertible Preferred Stock dated September 7, 1999.
Exhibit A
. CERTIFICATE OF THE DESIGNATIONS, POWERS, PREFERENCES
AND RIGHTS OF
SERIES C CONVERTIBLE PREFERRED STOCK
($.001 Par Value)
of
PURE CYCLE CORPORATION
______________________
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
______________________
PURE CYCLE CORPORATION, a Delaware corporation (the "Corporation"),
does hereby certify that the following resolutions were duly adopted by
the board of directors of the Corporation pursuant to authority conferred
upon the board of directors by Article IV of the Certificate of
Incorporation of the Corporation, which authorizes the issuance of up to
25,000,000 shares of Preferred Stock, at a meeting of the board of
directors duly held on August 3, 1998
RESOLVED, that one series of the class of authorized Preferred Stock, $.001
par value, of the Corporation is hereby created and that the designations,
powers, preferences and relative, participating, optional or other special
rights of the shares of such series, and qualifications, limitations or
restrictions thereof, are hereby fixed as follows:
1. Number of Shares and Designation. 3,200,000 shares of the Preferred
Stock, $.001 par value, of the Corporation are hereby constituted as a series
of the Preferred Stock designated as Series C Convertible Preferred Stock
(the "Series C Preferred Stock").
2. Liquidation.
A. Upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Series C
Preferred Stock will be entitled to share in any distribution or payment
made to the holders of Common Stock on a pro rata basis with the holders of
the Common Stock determined as if such holders had converted their Series C
Preferred Stock to Common Stock pursuant to Section 4 hereof immediately
prior to such liquidation, dissolution or winding up.
B. The Corporation will mail written notice of any distribution in
connection with such liquidation, dissolution or winding up, not less than
60 days prior to the payment date stated therein, to each record holder of
Series C Preferred Stock. Neither the consolidation or merger of the
Corporation into or with any other corporation or corporations, nor the
sale or transfer by the Corporation of all or any part of its assets,
nor the reduction of the capital stock of the Corporation, will be deemed
to be a liquidation, dissolution or winding up of the Corporation within
the meaning of this Section 2.
3. Dividends. The holders of the Series C Preferred Stock will be entitled
to share in any dividend or distribution or payment made to the holders of
Common Stock on a pro rata basis with the holders of the Common Stock
determined as if such holders had converted their Series C Preferred Stock to
Common Stock pursuant to Section 4 hereof immediately prior to such dividend
or distribution.
4. Conversion.
A. Right to Convert. Each share of Series C Preferred Stock shall be
convertible, at the option of the holder thereof, at any time, into 1
fully paid and non-assessable share of Common Stock (the "Conversion Rate"),
provided that the Corporation has authorized but unissued shares of Common
Stock to deliver to the holders of the Series C Preferred Stock at the time
of such conversion.
B. Fractional Shares. In the event the aggregate number of shares of
Series C Preferred Stock being converted by a holder thereof is convertible
into a number of shares of Common Stock which would require the issuance of
a fractional interest in a share of Common Stock, the Corporation shall
deliver cash in the amount of the fair market value of such fractional i
nterest.
C. Accrued Dividends. If, at the time the holder of shares of Series C
Preferred Stock exercises its right of conversion under Section 4.A, such
holder's shares of Series C Preferred Stock have accrued dividends which
remain unpaid at the time of such conversion, such holder's right to
receive dividends on the shares so converted, to the extent accrued but
unpaid on the date of conversion, shall continue.
D. Mechanics of Conversion. Before any holder of the Series C
Preferred Stock shall be entitled to voluntarily convert the same into
shares of Common Stock, such holder shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation, in
the case of a conversion pursuant to Section 4.A above, shall give written
notice to the Corporation at such office that he or she elects to convert
the same and shall state therein his or her name or the name or names of
his or her nominees in which he or she wishes the certificate or
certificates for shares of Common Stock to be issued. The Corporation
shall, as soon as practicable thereafter, issue and deliver at such office
to such holder of the Series C Preferred Stock, or to his or her
nominee or nominees, a certificate or certificates for the number of shares
of Common Stock to which he or she shall be entitled as aforesaid. Any
conversion shall be deemed to have taken place at 5:01 Mountain Time on
the date of such surrender of the shares 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; provided, however,
that the right to receive dividends on the shares so converted, to the
extent accrued but unpaid on the date of such conversion (whether or
not declared), shall continue.
E. Adjustment for Combinations or Consolidations of Common
Stock. In the event the Corporation at any time or from time to time after
the date of issuance of any Series C Preferred Stock effects a subdivision,
combination or reclassification of its outstanding shares of Common Stock
into a greater or lesser number of shares, then and in each such event the
Conversion Rate shall be increased or decreased proportionately.
F. Adjustments for Merger or Reorganization, etc. In case of any
consolidation or merger of the Corporation with or into another corporation
or the conveyance of all or substantially all of the assets of the
Corporation to another corporation or other person, provision shall be made
so that each share of the Series C Preferred Stock shall thereafter be
convertible into the number of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Corporation deliverable upon conversion of such Series C Preferred Stock
would have been entitled upon such consolidation, merger or conveyance; and,
in any such case, appropriate adjustment (as determined by the board of
directors) shall be made in the application of the provisions herein set
forth with respect to the rights and interest thereafter of the holders of
the Series C Preferred Stock, to the end that the provisions set
forth herein (including provisions with respect to changes in and other
adjustments of the Conversion Rate) shall thereafter be applicable, as
nearly as they reasonably may be, in relation to any shares of stock or
other securities or property thereafter deliverable upon the conversion of
the Series C Preferred Stock.
5. Voting.
A. Holders of the Series C Preferred Stock shall have the right to vote
together with the Common Stock, and not separately as a class, for the
election of directors and upon all other matters to be voted on by the
holders of the Common Stock of the Corporation. Every holder of shares of
the Series C Preferred Stock shall have the number of votes equal to the
number of shares of Common Stock that his or her shares of Series C
Preferred Stock would be convertible into pursuant to Section 4 on the record
date of the meeting at which such shares are being voted.
B. At each meeting or at any adjournment thereof at which the
holders of the Series C Preferred Stock have the right to vote as a class,
the presence, in person or by proxy, of the holders of a majority of the
Series C Preferred Stock then outstanding will be required to constitute a
quorum. The vote of a majority of such quorum will be required to take any
action at such meeting. Cumulative voting by holders of Series C Preferred
Stock is prohibited. In the absence of a quorum, a majority
of the holders present in person or by proxy of the Series C Preferred
Stock shall have the power to adjourn the portion of the meeting related to
that particular series for a period of up to 30 days without notice other
than announcement at the meeting until a quorum shall be present.
6. Corporation's Right to Purchase Series C Preferred Stock.
A. The Corporation shall have the right at any time to acquire any
Series C Preferred Stock from the owner of such shares on such terms as may
be agreeable to such owner. Shares of Series C Preferred Stock may be
acquired by the Corporation from any stockholder pursuant to this Section
6.A without offering any other stockholder an equal opportunity to sell his
stock to the Corporation, and no purchase by the Corporation from any
stockholder pursuant to this Section 6.A shall be deemed to create any right
on the part of any stockholder to sell any shares of Series C Preferred
Stock (or any other stock) to the Corporation. The purchase by the
Corporation of shares of Series C Preferred Stock pursuant to this Section
6.A shall not be deemed for any purpose to be a redemption. Such shares
shall not be entitled to receive dividends while held by the Company.
B. Notwithstanding the foregoing provisions of this Section 6, if a
dividend upon any shares of Series C Preferred Stock is past due, the
Corporation shall not purchase or otherwise acquire any shares of Series C
Preferred Stock, except (i) pursuant to a purchase or exchange offer made on
the same terms to all holders of the Series C Preferred Stock, or (ii) by
conversion of shares of Series C Preferred Stock into, or exchange of such
shares for, Common Stock.
7. Preemptive Rights. The holders of shares of Series C Preferred Stock are
not entitled to any preemptive or subscription rights in respect of any
securities of the Corporation.
8. Notices. Any notice required hereby to be given to the holders of shares
of Series C Preferred Stock shall be sufficiently given if sent by
telecopier, registered or certified mail, postage prepaid, by express mail
or by other express courier addressed to each holder of record at his
address appearing on the books of the Corporation. All notices and other
communications shall be effective (i) if mailed, when received or three
(3) days after mailing, whichever is earlier; (ii) if sent by express mail
or courier, when delivered; and (iii) if telecopied, when received by the
telecopier to which transmitted (a machine-generated transaction report
produced by sender bearing recipient's telecopier number being prima facie
proof of receipt).
9. Transfer Costs. The Corporation shall pay any and all documentary stamp
and other transaction taxes attributable to the issuance or delivery of
shares of Common Stock upon conversion of any shares of Series C Preferred
Stock; provided, however, that the Corporation shall not be required to pay
any tax which may be payable in respect of any transfer involved in the
issue or delivery of shares of Common Stock in a name other than that of the
holder of the Series C Preferred Stock to be converted and no such issue
or delivery shall be made unless and until the person requesting such issue
or delivery has paid to the Corporation the amount of any such tax or has
established, to the satisfaction of the Corporation, that such tax has been
paid.
IN WITNESS WHEREOF, the undersigned have executed this Certificate of
Designation this 3 day of August, 1998.
PURE CYCLE CORPORATION
By:
Margaret Hansson, Vice President
ATTEST:
By:
Mark W. Harding, Secretary
Exhibit B
CERTIFICATE OF THE DESIGNATIONS, POWERS, PREFERENCES
AND RIGHTS OF
SERIES C-1 CONVERTIBLE PREFERRED STOCK
($.001 Par Value)
of
PURE CYCLE CORPORATION
______________________
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
______________________
PURE CYCLE CORPORATION, a Delaware corporation (the "Corporation"),
does hereby certify that the following resolutions were duly adopted by the
board of directors of the Corporation pursuant to authority conferred upon
the board of directors by Article IV of the Certificate of Incorporation of
the Corporation, which authorizes the issuance of up to 25,000,000 shares of
Preferred Stock, at a meeting of the board of directors duly held on
January 5, 1999
RESOLVED, that one series of the class of authorized Preferred Stock, $.001
par value, of the Corporation is hereby created and that the designations,
powers, preferences and relative, participating, optional or other special
rights of the shares of such series, and qualifications, limitations or
restrictions thereof, are hereby fixed as follows:
1. Number of Shares and Designation. 500,000 shares of the Preferred Stock,
$.001 par value, of the Corporation are hereby constituted as a series of the
Preferred Stock designated as Series C-1 Convertible Preferred Stock (the
"Series C-1 Preferred Stock").
2. Liquidation.
A. Upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Series
C-1 Preferred Stock will be entitled to share in any distribution or payment
made to the holders of Common Stock on a pro rata basis with the holders of
the Common Stock determined as if such holders had converted their Series
C-1 Preferred Stock to Common Stock pursuant to Section 4 hereof immediately
prior to such liquidation, dissolution or winding up.
B. The Corporation will mail written notice of any distribution in
connection with such liquidation, dissolution or winding up, not less
than 60 days prior to the payment date stated therein, to each record
holder of Series C-1 Preferred Stock. Neither the consolidation or merger
of the Corporation into or with any other corporation or corporations, nor
the sale or transfer by the Corporation of all or any part of its assets,
nor the reduction of the capital stock of the Corporation, will be deemed
to be a liquidation, dissolution or winding up of the Corporation within
the meaning of this Section 2.
3. Dividends. The holders of the Series C-1 Preferred Stock will be
entitled to share in any dividend or distribution or payment made to the
holders of Common Stock on a pro rata basis with the holders of the Common
Stock determined as if such holders had converted their Series C-1 Preferred
Stock to Common Stock pursuant to Section 4 hereof immediately prior to such
dividend or distribution.
4. Conversion.
A. Right to Convert. Each share of Series C-1 Preferred Stock shall
be convertible, at the option of the holder thereof, at any time, into 1
fully paid and non-assessable share of Common Stock (the "Conversion Rate"),
provided that the Corporation has authorized but unissued shares of Common
Stock to deliver to the holders of the Series C-1 Preferred Stock at the
time of such conversion.
B. Fractional Shares. In the event the aggregate number of shares of
Series C-1 Preferred Stock being converted by a holder thereof is
convertible into a number of shares of Common Stock which would require the
issuance of a fractional interest in a share of Common Stock, the
Corporation shall deliver cash in the amount of the fair market value of
such fractional interest.
C. Accrued Dividends. If, at the time the holder of shares of Series
C-1 Preferred Stock exercises its right of conversion under Section 4.A,
such holder's shares of Series C-1 Preferred Stock have accrued dividends
which remain unpaid at the time of such conversion, such holder's right to
receive dividends on the shares so converted, to the extent accrued but
unpaid on the date of conversion, shall continue.
D. Mechanics of Conversion. Before any holder of the Series C-1
Preferred Stock shall be entitled to voluntarily convert the same into
shares of Common Stock, such holder shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation,
in the case of a conversion pursuant to Section 4.A above, shall give
written notice to the Corporation at such office that he or she elects to
convert the same and shall state therein his or her name or the name or
names of his or her nominees in which he or she wishes the certificate or
certificates for shares of Common Stock to be issued. The Corporation
shall, as soon as practicable thereafter, issue and deliver at such office
to such holder of the Series C-1 Preferred Stock, or to his or her
nominee or nominees, a certificate or certificates for the number of
shares of Common Stock to which he or she shall be entitled as aforesaid.
Any conversion shall be deemed to have taken place at 5:01 Mountain Time
on the date of such surrender of the shares 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; provided, however, that
the right to receive dividends on the shares so converted, to the extent
accrued but unpaid on the date of such conversion (whether or not
declared), shall continue.
E. Adjustment for Combinations or Consolidations of Common
Stock. In the event the Corporation at any time or from time to time
after the date of issuance of any Series C-1 Preferred Stock effects a
subdivision, combination or reclassification of its outstanding shares of
Common Stock into a greater or lesser number of shares, then and in each
such event the Conversion Rate shall be increased or decreased
proportionately.
F. Adjustments for Merger or Reorganization, etc. In case of any
consolidation or merger of the Corporation with or into another corporation
or the conveyance of all or substantially all of the assets of the
Corporation to another corporation or other person, provision shall be made
so that each share of the Series C-1 Preferred Stock shall thereafter be
convertible into the number of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Corporation deliverable upon conversion of such Series C-1 Preferred Stock
would have been entitled upon such consolidation, merger or conveyance; and,
in any such case, appropriate adjustment (as determined by the board of
directors) shall be made in the application of the provisions herein set
forth with respect to the rights and interest thereafter of the holders of
the Series C-1 Preferred Stock, to the end that the provisions
set forth herein (including provisions with respect to changes in and other
adjustments of the Conversion Rate) shall thereafter be applicable, as
nearly as they reasonably may be, in relation to any shares of stock or
other securities or property thereafter deliverable upon the conversion of
the Series C-1 Preferred Stock.
5. Voting.
A. Holders of the Series C-1 Preferred Stock shall have the right to
vote together with the Common Stock, and not separately as a class, for the
election of directors and upon all other matters to be voted on by the
holders of the Common Stock of the Corporation. Every holder of shares of
the Series C-1 Preferred Stock shall have the number of votes equal to the
number of shares of Common Stock that his or her shares of Series C-1
Preferred Stock would be convertible into pursuant to Section 4 on
the record date of the meeting at which such shares are being voted.
B. At each meeting or at any adjournment thereof at which the
holders of the Series C-1 Preferred Stock have the right to vote as a class,
the presence, in person or by proxy, of the holders of a majority of the
Series C-1 Preferred Stock then outstanding will be required to constitute
a quorum. The vote of a majority of such quorum will be required to take
any action at such meeting. Cumulative voting by holders of Series C-1
Preferred Stock is prohibited. In the absence of a quorum, a majority of
the holders present in person or by proxy of the Series C-1 Preferred Stock
shall have the power to adjourn the portion of the meeting related to that
particular series for a period of up to 30 days without notice other than
announcement at the meeting until a quorum shall be present.
6. Corporation's Right to Purchase Series C-1 Preferred Stock.
A. The Corporation shall have the right at any time to acquire any
Series C-1 Preferred Stock from the owner of such shares on such terms as
may be agreeable to such owner. Shares of Series C-1 Preferred Stock may be
acquired by the Corporation from any stockholder pursuant to this Section
6.A without offering any other stockholder an equal opportunity to sell his
stock to the Corporation, and no purchase by the Corporation from any
stockholder pursuant to this Section 6.A shall be deemed to create any right
on the part of any stockholder to sell any shares of Series C-1 Preferred
Stock (or any other stock) to the Corporation. The purchase by the
Corporation of shares of Series C-1 Preferred Stock pursuant to this
Section 6.A shall not be deemed for any purpose to be a redemption.
Such shares shall not be entitled to receive dividends while
held by the Company.
B. Notwithstanding the foregoing provisions of this Section 6, if a
dividend upon any shares of Series C-1 Preferred Stock is past due, the
Corporation shall not purchase or otherwise acquire any shares of Series C-1
Preferred Stock, except (i) pursuant to a purchase or exchange offer made on
the same terms to all holders of the Series C-1 Preferred Stock, or (ii) by
conversion of shares of Series C-1 Preferred Stock into, or exchange of
such shares for, Common Stock.
7. Preemptive Rights. The holders of shares of Series C-1 Preferred Stock
are not entitled to any preemptive or subscription rights in respect of any
securities of the Corporation.
8. Notices. Any notice required hereby to be given to the holders of shares
of Series C-1 Preferred Stock shall be sufficiently given if sent by
telecopier, registered or certified mail, postage prepaid, by express mail
or by other express courier addressed to each holder of record at his
address appearing on the books of the Corporation. All notices and other
communications shall be effective (i) if mailed, when received or three
(3) days after mailing, whichever is earlier; (ii) if sent by express mail
or courier, when delivered; and (iii) if telecopied, when received by the
telecopier to which transmitted (a machine-generated transaction report
produced by sender bearing recipient's telecopier number being prima facie
proof of receipt).
9. Transfer Costs. The Corporation shall pay any and all documentary stamp
and other transaction taxes attributable to the issuance or delivery of
shares of Common Stock upon conversion of any shares of Series C-1 Preferred
Stock; provided, however, that the Corporation shall not be required to pay
any tax which may be payable in respect of any transfer involved in the
issue or delivery of shares of Common Stock in a name other than that of
the holder of the Series C-1 Preferred Stock to be converted and no
such issue or delivery shall be made unless and until the person requesting
such issue or delivery has paid to the Corporation the amount of any such
tax or has established, to the satisfaction of the Corporation, that such
tax has been paid.
IN WITNESS WHEREOF, the undersigned have executed this Certificate of
Designation this 5 day of January, 1999.
PURE CYCLE CORPORATION
By:
Thomas P. Clark, President
ATTEST:
By:
Mark W. Harding, Secretary
Exhibit C
CERTIFICATE OF THE DESIGNATIONS, POWERS, PREFERENCES
AND RIGHTS OF
SERIES C-2 CONVERTIBLE PREFERRED STOCK
($.001 Par Value)
of
PURE CYCLE CORPORATION
______________________
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
______________________
PURE CYCLE CORPORATION, a Delaware corporation (the "Corporation"),
does hereby certify that the following resolutions were duly adopted by the
board of directors of the Corporation pursuant to authority conferred upon
the board of directors by Article IV of the Certificate of Incorporation of
the Corporation, which authorizes the issuance of up to 25,000,000 shares of
Preferred Stock, at a meeting of the board of directors duly held on
September 7, 1999
RESOLVED, that one series of the class of authorized Preferred Stock, $.001
par value, of the Corporation is hereby created and that the designations,
powers, preferences and relative, participating, optional or other special
rights of the shares of such series, and qualifications, limitations or
restrictions thereof, are hereby fixed as follows:
1. Number of Shares and Designation. 666,667 shares of the Preferred Stock,
$.001 par value, of the Corporation are hereby constituted as a series of
the Preferred Stock designated as Series C-2 Convertible Preferred Stock
(the "Series C-2 Preferred Stock").
2. Liquidation.
A. Upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Series
C-2 Preferred Stock will be entitled to share in any distribution or payment
made to the holders of Common Stock on a pro rata basis with the holders of
the Common Stock determined as if such holders had converted their Series
C-2 Preferred Stock to Common Stock pursuant to Section 4 hereof immediately
prior to such liquidation, dissolution or winding up.
B. The Corporation will mail written notice of any distribution in
connection with such liquidation, dissolution or winding up, not less than
60 days prior to the payment date stated therein, to each record holder of
Series C-2 Preferred Stock. Neither the consolidation or merger of the
Corporation into or with any other corporation or corporations, nor the sale
or transfer by the Corporation of all or any part of its assets, nor the
reduction of the capital stock of the Corporation, will be deemed to be a
liquidation, dissolution or winding up of the Corporation within the meaning
of this Section 2.
3. Dividends. The holders of the Series C-2 Preferred Stock will be entitled
to share in any dividend or distribution or payment made to the holders of
Common Stock on a pro rata basis with the holders of the Common Stock
determined as if such holders had converted their Series C-2 Preferred Stock
to Common Stock pursuant to Section 4 hereof immediately prior to such
dividend or distribution.
4. Conversion.
A. Right to Convert. Each share of Series C-2 Preferred Stock shall be
convertible, at the option of the holder thereof, at any time, into 1 fully
paid and non-assessable share of Common Stock (the "Conversion Rate"),
provided that the Corporation has authorized but unissued shares of Common
Stock to deliver to the holders of the Series C-2 Preferred Stock
at the time of such conversion.
B. Fractional Shares. In the event the aggregate number of shares of Series
C-2 Preferred Stock being converted by a holder thereof is convertible into
a number of shares of Common Stock which would require the issuance of a
fractional interest in a share of Common Stock, the Corporation shall
deliver cash in the amount of the fair market value of such fractional
interest.
C. Accrued Dividends. If, at the time the holder of shares of Series C-2
Preferred Stock exercises its right of conversion under Section 4.A, such
holder's shares of Series C-2 Preferred Stock have accrued dividends which
remain unpaid at the time of such conversion, such holder's right to receive
dividends on the shares so converted, to the extent accrued but unpaid on
the date of conversion, shall continue.
D. Mechanics of Conversion. Before any holder of the Series C-2 Preferred
Stock shall be entitled to voluntarily convert the same into shares of
Common Stock, such holder shall surrender the certificate or certificates
therefor, duly endorsed, at the office of the Corporation, in the case of a
conversion pursuant to Section 4.A above, shall give written notice
to the Corporation at such office that he or she elects to convert the same
and shall state therein his or her name or the name or names of his or her
nominees in which he or she wishes the certificate or certificates for
shares of Common Stock to be issued. The Corporation shall, as
soon as practicable thereafter, issue and deliver at such office to such
holder of the Series C-2 Preferred Stock, or to his or her nominee or
nominees, a certificate or certificates for the number
of shares of Common Stock to which he or she shall be entitled as aforesaid.
Any conversion shall be deemed to have taken place at 5:01 Mountain Time on
the date of such surrender of the shares 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; provided, however, that the
right to receive dividends on the shares so converted, to the extent accrued
but unpaid on the date of such conversion (whether or not declared), shall
continue.
E. Adjustment for Combinations or Consolidations of Common Stock. In the
event the Corporation at any time or from time to time after the date of
issuance of any Series C-2 Preferred Stock effects a subdivision,
combination or reclassification of its outstanding shares of Common Stock
into a greater or lesser number of shares, then and in each such event the
Conversion Rate shall be increased or decreased proportionately.
F. Adjustments for Merger or Reorganization, etc. In case of any
consolidation or merger of the Corporation with or into another corporation
or the conveyance of all or substantially all of the assets of the
Corporation to another corporation or other person, provision shall be made
so that each share of the Series C-2 Preferred Stock shall thereafter be
convertible into the number of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock of the
Corporation deliverable upon conversion of such Series C-2 Preferred Stock
would have been entitled upon such consolidation, merger or conveyance; and,
in any such case, appropriate adjustment (as determined by the board of
directors) shall be made in the application of the provisions herein set
forth with respect to the rights and interest thereafter of the holders of
the Series C-2 Preferred Stock, to the end that the provisions set forth
herein (including provisions with respect to changes in and other adjustments
of the Conversion Rate) shall thereafter be applicable, as nearly as they
reasonably may be, in relation to any shares of stock or other securities
or property thereafter deliverable upon the conversion of the Series C-2
Preferred Stock.
5. Voting.
A. Holders of the Series C-2 Preferred Stock shall have the right to vote
together with the Common Stock, and not separately as a class, for the
election of directors and upon all other matters to be voted on by the
holders of the Common Stock of the Corporation. Every holder of shares of
the Series C-2 Preferred Stock shall have the number of votes equal to
the number of shares of Common Stock that his or her shares of Series C-2
Preferred Stock would be convertible into pursuant to Section 4 on the
record date of the meeting at which such shares are being voted.
B. At each meeting or at any adjournment thereof at which the holders of the
Series C-2 Preferred Stock have the right to vote as a class, the presence,
in person or by proxy, of the holders of a majority of the Series C-2
Preferred Stock then outstanding will be required to constitute a quorum.
The vote of a majority of such quorum will be required to take any action
at such meeting. Cumulative voting by holders of Series C-2 Preferred Stock
is prohibited. In the absence of a quorum, a majority of the holders
present in person or by proxy of the Series C-2 Preferred Stock shall have
the power to adjourn the portion of the meeting related to that
particular series for a period of up to 30 days without notice other than
announcement at the meeting until a quorum shall be present.
6. Corporation's Right to Purchase Series C-2 Preferred Stock.
A. The Corporation shall have the right at any time to acquire any Series
C-2 Preferred Stock from the owner of such shares on such terms as may be
agreeable to such owner. Shares of Series C-2 Preferred Stock may be
acquired by the Corporation from any stockholder pursuant to this Section
6.A without offering any other stockholder an equal opportunity to sell
his stock to the Corporation, and no purchase by the Corporation from any
stockholder pursuant to this Section 6.A shall be deemed to create any right
on the part of any stockholder to sell any shares of Series C-2 Preferred
Stock (or any other stock) to the Corporation. The purchase by
the Corporation of shares of Series C-2 Preferred Stock pursuant to this
Section 6.A shall not be deemed for any purpose to be a redemption.
Such shares shall not be entitled to receive dividends while held by the
Company.
B. Notwithstanding the foregoing provisions of this Section 6, if a dividend
upon any shares of Series C-2 Preferred Stock is past due, the Corporation
shall not purchase or otherwise acquire any shares of Series C-2 Preferred
Stock, except (i) pursuant to a purchase or exchange offer made on the same
terms to all holders of the Series C-2 Preferred Stock, or (ii) by
conversion of shares of Series C-2 Preferred Stock into, or exchange of
such shares for, Common Stock.
7. Preemptive Rights. The holders of shares of Series C-2 Preferred Stock are
not entitled to any preemptive or subscription rights in respect of any
securities of the Corporation.
8. Notices. Any notice required hereby to be given to the holders of shares
of Series C-2 Preferred Stock shall be sufficiently given if sent by telecopier,
registered or certified mail, postage prepaid, by express mail or by other
express courier addressed to each holder of record at his address appearing
on the books of the Corporation. All notices and other communications
shall be effective (i) if mailed, when received or three (3) days after
mailing, whichever is earlier; (ii) if sent by express mail or courier,
when delivered; and (iii) if telecopied, when received by the telecopier to
which transmitted (a machine-generated transaction report produced
by sender bearing recipient's telecopier number being prima facie proof of
receipt).
9. Transfer Costs. The Corporation shall pay any and all documentary stamp
and other transaction taxes attributable to the issuance or delivery of
shares of Common Stock upon conversion of any shares of Series C-2 Preferred
Stock; provided, however, that the Corporation shall not be required to pay
any tax which may be payable in respect of any transfer involved in
the issue or delivery of shares of Common Stock in a name other than that
of the holder of the Series C-2 Preferred Stock to be converted and no such
issue or delivery shall be made unless and until the person requesting such
issue or delivery has paid to the Corporation the amount of any such tax or
has established, to the satisfaction of the Corporation, that such tax has
been paid.
IN WITNESS WHEREOF, the undersigned have executed this Certificate of
Designation this 7 day of September, 1999.
PURE CYCLE CORPORATION
By:
Thomas P. Clark, President
ATTEST:
By:
Mark W. Harding, Secretary
Schedule 13D
CUSIP No. 736228 10 5 Pure Cycle
