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EXHIBIT 3(a)
SECOND AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
SUPERCONDUCTIVE COMPONENTS, INC.
(adopted SEPTEMBER 12, 1995)
Edward R. Funk, President and Curtis A. Loveland, Secretary, of
Superconductive Components, Inc. (the "Corporation"), with its principal offices
located at Columbus, Franklin County, Ohio, do hereby certify that in an action
by unanimous written consent of the directors pursuant to Section 1701.54 of the
Ohio Revised Code, the Articles of Incorporation have been amended and restated
pursuant to Section 1701.72 of the Ohio Revised Code, as follows:
FIRST: The name of said Corporation shall be Superconductive
Components, Inc.
SECOND: The place in Ohio where its principal office is to be located
is the City of Columbus, Franklin County, Ohio.
THIRD: The purposes for which it is formed are to engage in any
business or activity for which corporations are formed under Sections 1701.01 to
1701.98, inclusive, of the Revised Code of Ohio.
FOURTH:
A. AUTHORIZED SHARES.
The total number of shares of all classes of stock
which the Corporation shall have the authority to
issue is Fifteen Million Two Hundred Sixty Thousand
(15,260,000) consisting of:
1. Fifteen Million (15,000,000) shares of
Common Stock, without par value (the "Common
Stock");
2. Ten Thousand (10,000) cumulative
preferred shares, without par value (the
"Cumulative Preferred Stock");
3. One Hundred Twenty-Five Thousand
(125,000) shares of Voting Preferred Stock,
without par value (the "Voting Preferred
Stock"); and
4. One Hundred Twenty-Five Thousand
(125,000) shares of Non-Voting Preferred
Stock, without par value (the "Non-Voting
Preferred Stock").
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B. COMMON STOCK
The holders of the Common Stock are entitled at all times to
one vote for each share and to such dividends as the Board of
Directors may in its discretion from time to time legally
declare, subject, however, to the voting and dividend rights,
if any, of the holders of the Voting Preferred Stock and the
Non-Voting Preferred Stock. In the event of any liquidation,
dissolution or winding up of the Corporation, the remaining
assets of the Corporation after the payment of all debts and
necessary expenses shall be distributed among the holders of
the Common Stock pro rata in accordance with their respective
holdings, subject, however, to the rights of the holders of
the Voting Preferred Stock and the Non-Voting Preferred Stock
then outstanding. The Common Stock is subject to all of the
terms and provisions of the Voting Preferred Stock and the
Non-Voting Preferred Stock as fixed by the Board of Directors
as hereinafter provided.
C. CUMULATIVE PREFERRED STOCK
Each share of the Cumulative Preferred Stock shall have a
stated value of Three Hundred Dollars ($300.00) and be
entitled to receive dividends at the rate of ten (10%) per
annum of the stated value per share thereof, paid, at the
election of the Corporation, in either (i) cash or (ii) Common
Stock at the then per share market value of the Common Stock.
Such dividends shall be cumulative from the date of issuance
and shall be payable in arrears, when and as declared by the
Board of Directors. Each share of the Cumulative Preferred
Stock shall be equal to every other share of Cumulative
Preferred Stock except that shares issued at different times
may differ as to the dates from which dividends thereon shall
be cumulative. Except as otherwise provided in this Article
Fourth, each share of Cumulative Preferred Stock shall be
equal to each share of Common Stock in all respects,
including, without limitation, voting rights and rights upon
liquidation.
Subject to an upon compliance with the provisions above, the
holder of any shares of Cumulative Preferred Stock may at his
option convert any such shares of Cumulative Preferred Stock
into such number of fully paid and nonassessable shares of
Common Stock as are issuable pursuant to the formula set forth
below; provided, however, that there must be sufficient Common
Stock duly and validly authorized and unissued to accommodate
any such conversion.
The basic conversion rate shall be five hundred (500) shares
of Common Stock for each share of Cumulative Preferred Stock
surrendered for conversion.
In case at any time or from time to time the Corporation
shall:
(i) take a record of the holders of its Common Stock
for the purpose of entitling them to receive a
dividend payable in, or other distribution of, Common
Stock, or
(ii) subdivide its outstanding shares of Common Stock
into a larger number of shares of Common Stock, or
(iii) combine its outstanding shares of Common Stock
into a smaller number of shares of Common Stock,
then the conversion rate in effect immediately after the
happening of any such event shall be proportionately
increased, in case of the happening of events described in
subparagraphs (i) or (ii) above, or proportionately decreased
in case of the happening of events described in subparagraph
(iii) above.
To convert shares of Cumulative Preferred Stock, the holder
shall give the Corporation thirty (30) days advance written
notice which notice shall contain (i) the number of shares of
Cumulative
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Preferred Stock to be exchanged and (ii) stock certificates
representing the shares of Cumulative Preferred Stock to be
exchanged. The Board of Directors of the Corporation is
expressly authorized to take appropriate action, without
any further action by the shareholders of this Corporation,
to ensure that any such conversion may be accomplished
within thirty (30) days, including, without limitation
thereto, the adoption of an amendment to the Articles of
Incorporation to increase the number of authorized Common
Stock in order to accommodate the conversion.
So long as any shares of Cumulative Preferred Stock are
outstanding, the Corporation shall not, without the consent
(given in writing without a meeting or by vote in person or by
proxy at a meeting called for the purpose) of the holders of
at least a majority of the aggregate number of shares of
Cumulative Preferred Stock entitled to vote thereon, amend,
change or repeal any of the express terms of the Cumulative
Preferred Stock in any manner adverse to the holders thereof.
D. VOTING PREFERRED STOCK
The Board of Directors is hereby expressly authorized to adopt
amendments to the Articles of Incorporation to provide for the
issuance of one or more series of Voting Preferred Stock, to
establish from time to time the number of shares to be
included in each such series, to fix the designation, powers,
preferences and rights of the shares of each such series and
any qualifications, limitations or restrictions thereof,
including without limitation the following, and the shares of
each series may vary from the shares of any other series in
the following respects:
(a) the division of such shares into series and the
designation and authorized number of shares of each
series;
(b) the annual dividend rate on the shares;
(c) the dates of payment of dividends, whether the
dividends shall be cumulative and, if cumulative, the
date from which dividends shall accumulate;
(d) the redemption price or prices for the particular
series, if redeemable, and the terms and conditions
of such redemption;
(e) sinking fund requirements, if any;
(f) the preference, if any, of the shares of
such series in the event of any voluntary or
involuntary liquidation, dissolution, or winding up
of affairs of the Corporation;
(g) the right, if any, of the shares of such series
to be converted into shares of any other series or
class and the terms and conditions of such
conversion; and
(h) any other relative rights, preferences, and
limitations of that series.
The holders of Voting Preferred Stock shall be entitled at all
times to one vote for each share, voting as a class.
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E. NON-VOTING PREFERRED STOCK
The Board of Directors is hereby expressly authorized to adopt
amendments to the Articles of Incorporation to provide for the
issuance of one or more series of Non-Voting Preferred Stock,
and to establish from time to time the number of shares to be
included in each such series, to fix the designation, powers,
preferences and rights of the shares of each such series and
any qualifications, limitations or restrictions thereof,
including without limitation the following, and the shares of
each series may vary from the shares of any other series in
the following respects:
(a) the division of such shares into series and the
designation and authorized number of shares of each
series;
(b) the annual dividend rate on the shares;
(c) the dates of payment of dividends, whether the
dividends shall be cumulative and, if cumulative, the
date from which dividends shall accumulate;
(d) the redemption price or prices for the particular
series, if redeemable, and the terms and conditions
of such redemption;
(e) sinking fund requirements, if any;
(f) the preference, if any, of the shares of such
series in the event of any voluntary or involuntary
liquidation, dissolution, or winding up of affairs of
the Corporation;
(g) the right, if any, of the shares of such series
to be converted into shares of any other series or
class and the terms and conditions of such
conversion; and
(h) any other relative rights, preferences, and
limitations of that series.
Except as otherwise required by law, no holders of Non-Voting
Preferred Stock shall be entitled to vote on any matter
submitted to the shareholders of the Corporation.
F. SERIES A 10% NON-VOTING CONVERTIBLE PREFERRED STOCK.
There shall be created out of the authorized number of the
Non-Voting Preferred Stock of the Corporation a series
designated as "Series A 10% Non-Voting Convertible Preferred
Stock" (the "Series A Non-Voting Preferred Stock"), to consist
of 700 shares, with a stated value of $1,000 per share, of
which the preferences, rights, qualifications, limitations and
restrictions thereof, shall be as follows:
(1) CERTAIN DEFINITIONS. Unless the context otherwise
requires, the terms defined in this paragraph shall have, for
the purposes of this paragraph and paragraphs 2 through 9
below, the meanings herein specified.
COMMON STOCK. The term "Common Stock" shall mean all
shares now or hereafter authorized of any class of
Common Stock of the Corporation and any other shares
of the Corporation, howsoever designated, authorized
after the Issue Date, which have the right (subject
always to prior rights of any class or series of
Voting and Non-Voting Preferred Stock) to participate
in the distribution of the assets and earnings of the
Corporation without limit as to per share amount.
CUMULATIVE PREFERRED STOCK. The term "Cumulative
Preferred Stock" shall mean all shares now or
hereafter authorized of any class of Cumulative
Preferred Stock of the
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Corporation which are entitled to receive dividends
at the rate of ten percent (10%) per annum of the
stated value per share thereof and which are
convertible into shares of Common Stock.
ISSUE DATE. The term "Issue Date" shall mean the date
that shares of Series A Non-Voting Preferred Stock
are first issued by the Corporation.
JUNIOR STOCK. The term "Junior Stock" shall mean the
Common Stock and the Cumulative Preferred Stock and
any class or series of shares of the Corporation
issued after the Issue Date not entitled to receive
any assets upon the liquidation, dissolution or
winding up of the affairs of the Corporation until
the shares of Series A Non-Voting Preferred Stock
shall have received the Stated Value of all
outstanding shares of Series A Non-Voting Preferred
Stock as of the date of such liquidation, dissolution
or winding up, plus any accrued and unpaid dividends
to such date.
PARITY STOCK. The term "Parity Stock" shall mean, for
purposes of paragraph 3 below, any class or series of
shares of the Corporation issued after the Issue Date
entitled to receive assets upon the liquidation,
dissolution or winding up of the affairs of the
Corporation on a parity with the Series A Non-Voting
Preferred Stock.
SENIOR STOCK. The term "Senior Stock" shall mean any
class or series of shares of the Corporation issued
after the Issue Date ranking senior to the Series A
Non-Voting Preferred Stock in respect of the right to
receive dividends, as discussed in paragraph 2 below,
or assets upon the liquidation, dissolution or
winding up of the affairs of the Corporation, as
discussed in paragraph 3 below.
STATED VALUE. The term "Stated Value" when used in
reference to the Series A Non-Voting Preferred Stock
shall mean $1,000 per share of Series A Non-Voting
Preferred Stock.
(2) DIVIDENDS. Subject to the limitations set forth below, the
holders of the Series A Non-Voting Preferred Stock shall be
entitled to receive dividends at the rate of 10% of the Stated
Value per annum per share. Dividends shall be payable on each
anniversary of the Issue Date. Dividends shall be payable
either in shares of Series A Non-Voting Preferred Stock or
cash, in the sole option of the Corporation, for the initial
three years that the Series A Non-Voting Preferred Stock is
outstanding, and thereafter in cash to the extent funds are
then legally available for the payment of such cash dividends.
The right of the holders of the Series A Non-Voting Preferred
Stock to receive such dividends shall be cumulative and shall
accrue from the date of issuance of the Series A Non-Voting
Preferred Stock. If at any time, the aggregate amount of cash
dividends to be paid by the Corporation on the Series A
Non-Voting Preferred Stock is insufficient to permit the
payment of the full amount of cash dividends then accrued on
all issued and outstanding Series A Non-Voting Preferred
Stock, then such cash dividends, to the extent payable, shall
be distributed to the holders of all outstanding Series A
Non-Voting Preferred Stock ratably in proportion to the
respective amounts of cash dividends then accrued and unpaid
on such Series A Non-Voting Preferred Stock. So long as any
Series A Non-Voting Preferred Stock shall remain outstanding,
no cash dividends shall be declared or paid on any Junior
Stock until all accrued and unpaid cash dividends on the
Series A Non-Voting Preferred Stock have been paid to the
holders thereof.
In the event that any of the Series A Non-Voting Preferred
Stock is converted, as provided herein, prior to a dividend
payment date, no payment of or adjustment for dividends yet
due shall be made on the Series A Non-Voting Preferred Stock
converted.
(3) LIQUIDATION RIGHTS. In the event of any liquidation,
dissolution, or winding up of the Corporation, the holders of
the Series A Non-Voting Preferred Stock then outstanding shall
be
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entitled to receive out of the assets of the Corporation,
before any distribution or payment shall be made to the
holders of any Junior Stock, an amount equal to the Stated
Value per share plus any accrued and unpaid cumulative
dividends thereon. If upon any liquidation, dissolution, or
winding up, amounts distributable to the holders of all Series
A Non-Voting Preferred Stock and any Parity Stock shall be
insufficient to permit the payment of the full liquidation
amounts on all issued and outstanding Series A Non-Voting
Preferred Stock and Parity Stock, then the entire assets of
the Corporation available for distribution to the holders of
Series A Non-Voting Preferred Stock and Parity Stock shall be
distributed to holders of all Series A Non-Voting Preferred
Stock and Parity Stock ratably in proportion to the full
preferential amounts to which such holders are respectively
entitled. A consolidation or merger of the Corporation with or
into any other corporation or corporations, or a sale or
transfer of all, or substantially all, of its property shall
not be deemed to be a liquidation, dissolution, or winding up
of the Corporation.
(4) OPTIONAL REDEMPTION. After the third anniversary of the
Issue Date, the Corporation may, at its option, redeem the
Series A Non-Voting Preferred Stock, in whole or in part, at a
redemption price equal to 103% of the Stated Value plus the
amount of any accrued and unpaid cash dividends thereon to the
date of such redemption. In case of the redemption of only a
part of the Series A Non-Voting Preferred Stock, the Series A
Non-Voting Preferred Stock to be redeemed shall be selected by
whatever means the Board of Directors may, in its sole
discretion, determine.
(5) MANDATORY REDEMPTION. Twenty-five percent (25%) of the
Series A Non-Voting Preferred Stock issued and outstanding as
of the fourth anniversary of the Issue Date shall be redeemed
by the Corporation on the fourth, fifth, sixth and seventh
anniversary dates of the Issue Date at a redemption price
equal to the Stated Value per share plus the amount of any
accrued and unpaid cash dividends thereon to the date of such
redemption. The Series A Non-Voting Preferred Stock to be
redeemed shall be selected by whatever means the Board of
Directors may, in its sole discretion, determine.
(6) NOTICE OF REDEMPTION Notice of any redemption shall be
given by the Corporation to the holders of record of the
Series A Non-Voting Preferred Stock to be redeemed at their
respective addresses then appearing upon the books of the
Corporation not less than 30 nor more than 60 days prior to
the date fixed for such redemption (the "Redemption Date"),
which notice shall specify the Redemption Date, the number of
shares to be redeemed, and the place where certificates
representing such Series A Non-Voting Preferred Stock are to
be surrendered. On the Redemption Date, all Series A
Non-Voting Preferred Stock as to which such notice shall have
been given shall, whether or not certificates therefor shall
have been surrendered for cancellation, be deemed to be no
longer outstanding for any purpose, and all rights with
respect to such Series A Non-Voting Preferred Stock shall
thereupon terminate, except only the right of the holders of
the certificates for such Series A Non-Voting Preferred Stock
to receive the amount payable upon the redemption thereof,
without further dividends.
Notwithstanding any provisions of paragraphs 4 and 5 above to
the contrary, the Corporation shall not be obligated to pay to
any holder of the Series A Non-Voting Preferred Stock the
redemption price for any Series A Non-Voting Preferred Stock
to be redeemed until such holder shall have surrendered to the
Corporation certificates representing such Series A Non-Voting
Preferred Stock.
(7) CONVERSION RIGHTS. The holders of the Series A Non-Voting
Preferred Stock shall have the right and option to convert all
or part of the Series A Non-Voting Preferred Stock then owned
by them, at any time, into Common Stock; provided, however,
that, except for the conversion of all of the Series A
Non-Voting Preferred Stock then owned by a holder, no
fractional share of Series A Non-Voting Preferred Stock may be
converted at any time.
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The Common Stock issuable to each holder of Series A
Non-Voting Preferred Stock upon conversion of any Series A
Non-Voting Preferred Stock shall be, subject to adjustments as
described in paragraph 8 below, based upon a conversion price
of $.60 per share of Common Stock so that the number of shares
of Common Stock issuable for each share of Series A Non-Voting
Preferred Stock converted shall be calculated by dividing the
Stated Value of each share of Series A Non-Voting Preferred
Stock by $.60. Furthermore, and notwithstanding the foregoing
sentences of this paragraph, the Corporation shall not be
obligated to issue any fractional shares of Common Stock upon
conversion of any shares of Series A Non-Voting Preferred
Stock. In lieu of any fractional shares of Common Stock to
which a holder of shares of Series A Non-Voting Preferred
Stock would otherwise be entitled, the Corporation shall pay
to such holder cash in an amount equal to the market price of
the Common Stock as of the effective date of the conversion,
as such price shall be allocable to such fractional shares of
Common Stock. For purposes of this paragraph, the market price
per share of the Common Stock on any date shall be equal to
the average of the quoted prices of such shares for 30
consecutive trading days commencing 45 trading days before the
date in question. In the absence of one or more such
quotations, or in the absence of any trading market for such
shares, the Corporation shall determine the market price of
the Common Stock on the basis of such quotations, bid and
asked prices, or other information as it considers appropriate
and reasonable in light of the circumstances.
If the Series A Non-Voting Preferred Stock, in whole or in
part, is called for redemption, the right to convert such
Series A Non-Voting Preferred Stock into Common Stock ceases
at the close of business on the day prior to the Redemption
Date set in the notice of redemption.
(8) CONVERSION PROCEDURES. In order for the holders of the
Series A Non-Voting Preferred Stock to exercise their
conversion right and option, a holder of the Series A
Non-Voting Preferred Stock shall give written notice to the
Corporation stating that such holder thereby exercises its
conversion right and option and specifying the number of
shares of Series A Non-Voting Preferred Stock such holder
desires to convert at that time. Such notice shall be
accompanied by stock certificates representing the Series A
Non-Voting Preferred Stock then being converted, duly endorsed
for transfer to the Corporation. Each such conversion shall be
deemed effective on the date the Corporation receives such
notice and such stock certificates. Any notice given by any
holder of Series A Non-Voting Preferred Stock under this
paragraph shall be irrevocable, and all rights with respect to
Series A Non-Voting Preferred Stock converted into Common
Stock shall terminate as of the effective date of such
conversion, except the right to receive certificates
representing the Common Stock issuable upon such conversion.
(9) ADJUSTMENTS TO CONVERSION PRICE. If the Corporation (a)
pays a dividend or makes a distribution on its Common Stock in
Common Stock; (b) subdivides its outstanding Common Stock into
a greater number of shares; (c) combines its outstanding
Common Stock into a smaller number of shares; (d) makes a
distribution on its Common Stock in shares of its capital
stock other than Common Stock; or (e) issues by
reclassification of its Common Stock any shares of its capital
stock, then the conversion privilege and the conversion price
in effect immediately before such action shall be adjusted so
that the holders of the Series A Non-Voting Preferred Stock
may thereafter receive the number of shares of Common Stock
which such holders would have owned immediately following such
action if they had converted the Series A Non-Voting Preferred
Stock immediately before such action.
If the Corporation merges or consolidates with another
corporation or sells or transfers all or substantially all of
its assets to another person and the holders of the Common
Stock are entitled to receive stock, securities, or property
in respect of or in exchange for Common Stock, then as a
condition of such merger, consolidation, sale or transfer, the
Corporation and any such successor, purchaser, or transferee
shall amend the Series A Non-Voting Preferred Stock to provide
that they may thereafter by converted in to the kind and
amount of stock, securities, or property receivable upon such
merger, consolidation, sale, or transfer by a holder of the
number of Common Stock
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into which the Series A Non-Voting Preferred Stock might have
been converted immediately before such merger, consolidation,
sale or transfer.
G. SERIES B 10% NON-VOTING CONVERTIBLE PREFERRED STOCK.
There shall be created out of the authorized number of the
Non-Voting Preferred Stock of the Corporation a series
designated as "Series B 10% Non-Voting Convertible Preferred
Stock" (the "Series B Non-Voting Preferred Stock"), to consist
of 100,000 shares, with a stated value of $10 per share, of
which the preferences, rights, qualifications, limitations and
restrictions thereof, shall be as follows:
(1) CERTAIN DEFINITIONS. Unless the context otherwise
requires, the terms defined in this paragraph shall have,
for the purposes of this paragraph and paragraphs 2 through
9 below, the meanings herein specified.
COMMON STOCK. The term "Common Stock" shall mean all
shares now or hereafter authorized of any class of
Common Stock of the Corporation and any other shares
of the Corporation, howsoever designated, authorized
after the Issue Date, which have the right (subject
always to prior rights of any class or series of
Voting and Non-Voting Preferred Stock) to participate
in the distribution of the assets and earnings of the
Corporation without limit as to per share amount.
CUMULATIVE PREFERRED STOCK. The term "Cumulative
Preferred Stock" shall mean all shares now or
hereafter authorized of any class of Cumulative
Preferred Stock of the Corporation which are entitled
to receive dividends at the rate of ten percent (10%)
per annum of the stated value per share thereof and
which are convertible into shares of Common Stock.
ISSUE DATE. The term "Issue Date" shall mean the date
that shares of Series B Non-Voting Preferred Stock
are first issued by the Corporation.
JUNIOR STOCK. The term "Junior Stock" shall mean the
Common Stock and the Cumulative Preferred Stock and
any class or series of shares of the Corporation
issued after the Issue Date not entitled to receive
any assets upon the liquidation, dissolution or
winding up of the affairs of the Corporation until
the shares of Series B Non-Voting Preferred Stock
shall have received the Stated Value of all
outstanding shares of Series B Non-Voting Preferred
Stock as of the date of such liquidation, dissolution
or winding up, plus any accrued and unpaid dividends
to such date.
PARITY STOCK. The term "Parity Stock" shall mean, for
purposes of paragraphs 2 and 3 below, the Series A
Non-Voting Preferred Stock, as defined, and any class
or series of shares of the Corporation issued after
the Issue Date entitled to receive assets upon the
liquidation, dissolution or winding up of the affairs
of the Corporation on a parity with the Series B
Non-Voting Preferred Stock.
SERIES A NON-VOTING PREFERRED STOCK. The term "Series
A Non-Voting Preferred Stock" shall mean those shares
described in paragraph (F) above.
SENIOR STOCK. The term "Senior Stock" shall mean any
class or series of shares of the Corporation issued
after the Issue Date ranking senior to the Series B
Non-Voting Preferred Stock in respect of the right to
receive dividends, as discussed in paragraph 2 below,
or assets upon the liquidation, dissolution or
winding up of the affairs of the Corporation, as
discussed in paragraph 3 below.
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STATED VALUE. The term "Stated Value" when used in
reference to the Series B Non-Voting Preferred Stock
shall mean $10 per share of Series B Non-Voting
Preferred Stock.
(2) DIVIDENDS. Subject to the limitations set forth below, the
holders of the Series B Non-Voting Preferred Stock shall be
entitled to receive dividends at the rate of 10% of the Stated
Value per annum per share. Dividends shall be payable on each
anniversary of the Issue Date. Dividends shall be payable
either in shares of Series B Non-Voting Preferred Stock or
cash, in the sole option of the Corporation, for the initial
three years that the Series B Non-Voting Preferred Stock is
outstanding, and thereafter in cash to the extent funds are
then legally available for the payment of such cash dividends.
The right of the holders of the Series B Non-Voting Preferred
Stock to receive such dividends shall be cumulative and shall
accrue from the date of issuance of the Series B Non-Voting
Preferred Stock. If at any time, the aggregate amount of cash
dividends to be paid by the Corporation on the Series B
Non-Voting Preferred Stock and Parity Stock is insufficient to
permit the payment of the full amount of cash dividends then
accrued on all issued and outstanding Series B Non-Voting
Preferred Stock and Parity Stock, then such cash dividends, to
the extent payable, shall be distributed to the holders of all
outstanding Series B Non-Voting Preferred Stock and Parity
Stock ratably in proportion to the respective amounts of cash
dividends then accrued and unpaid on such Series B Non-Voting
Preferred Stock and Parity Stock. So long as any Series B
Non-Voting Preferred Stock shall remain outstanding, no cash
dividends shall be declared or paid on any Junior Stock until
all accrued and unpaid cash dividends on the Series B
Non-Voting Preferred Stock have been paid to the holders
thereof.
In the event that any of the Series B Non-Voting Preferred
Stock is converted, as provided herein, prior to a dividend
payment date, no payment of or adjustment for dividends yet
due shall be made on the Series B Non-Voting Preferred Stock
converted.
(3) LIQUIDATION RIGHTS. In the event of any liquidation,
dissolution, or winding up of the Corporation, the holders of
the Series B Non-Voting Preferred Stock and Parity Stock then
outstanding shall be entitled to receive out of the assets of
the Corporation, before any distribution or payment shall be
made to the holders of any Junior Stock, an amount equal to
the Stated Value per share plus any accrued and unpaid
cumulative dividends thereon. If upon any liquidation,
dissolution, or winding up, amounts distributable to the
holders of all Series B Non-Voting Preferred Stock and any
Parity Stock shall be insufficient to permit the payment of
the full liquidation amounts on all issued and outstanding
Series B Non-Voting Preferred Stock and Parity Stock, then the
entire assets of the Corporation available for distribution to
the holders of Series B Non-Voting Preferred Stock and Parity
Stock shall be distributed to holders of all Series B
Non-Voting Preferred Stock and Parity Stock ratably in
proportion to the full preferential amounts to which such
holders are respectively entitled. A consolidation or merger
of the Corporation with or into any other corporation or
corporations, or a sale or transfer of all, or substantially
all, of its property shall not be deemed to be a liquidation,
dissolution, or winding up of the Corporation.
(4) OPTIONAL REDEMPTION. After the third anniversary of the
Issue Date, the Corporation may, at its option, redeem the
Series B Non-Voting Preferred Stock, in whole or in part, at a
redemption price equal to 103% of the Stated Value plus the
amount of any accrued and unpaid cash dividends thereon to the
date of such redemption. In case of the redemption of only a
part of the Series B Non-Voting Preferred Stock, the Series B
Non-Voting Preferred Stock to be redeemed shall be selected by
whatever means the Board of Directors may, in its sole
discretion, determine.
(5) NOTICE OF REDEMPTION Notice of any redemption shall be
given by the Corporation to the holders of record of the
Series B Non-Voting Preferred Stock to be redeemed at their
respective addresses then appearing upon the books of the
Corporation not less than 30 nor more than 60 days prior to
the date fixed for such redemption (the "Redemption Date"),
which notice shall specify the Redemption Date, the number of
shares to be redeemed, and the place where certificates
representing such Series B Non-Voting Preferred Stock are to
be surrendered. On the
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Redemption Date, all Series B Non-Voting Preferred Stock as to
which such notice shall have been given shall, whether or not
certificates therefor shall have been surrendered for
cancellation, be deemed to be no longer outstanding for any
purpose, and all rights with respect to such Series B
Non-Voting Preferred Stock shall thereupon terminate, except
only the right of the holders of the certificates for such
Series B Non-Voting Preferred Stock to receive the amount
payable upon the redemption thereof, without further
dividends.
Notwithstanding any provisions of paragraph 4 above to the
contrary, the Corporation shall not be obligated to pay to any
holder of the Series B Non-Voting Preferred Stock the
redemption price for any Series B Non-Voting Preferred Stock
to be redeemed until such holder shall have surrendered to the
Corporation certificates representing such Series B Non-Voting
Preferred Stock.
(6) CONVERSION RIGHTS. The holders of the Series B Non-Voting
Preferred Stock shall have the right and option to convert all
or part of the Series B Non-Voting Preferred Stock then owned
by them, at any time, into Common Stock; provided, however,
that, except for the conversion of all of the Series B
Non-Voting Preferred Stock then owned by a holder, no
fractional share of Series B Non-Voting Preferred Stock may be
converted at any time.
The Common Stock issuable to each holder of Series B
Non-Voting Preferred Stock upon conversion of any Series B
Non-Voting Preferred Stock shall be, subject to adjustments as
described in paragraph 8 below, based upon a conversion price
of $.50 per share of Common Stock so that the number of shares
of Common Stock issuable for each share of Series B Non-Voting
Preferred Stock converted shall be calculated by dividing the
Stated Value of each share of Series B Non-Voting Preferred
Stock by $.50. Furthermore, and notwithstanding the foregoing
sentences of this paragraph, the Corporation shall not be
obligated to issue any fractional shares of Common Stock upon
conversion of any shares of Series B Non-Voting Preferred
Stock. In lieu of any fractional shares of Common Stock to
which a holder of shares of Series B Non-Voting Preferred
Stock would otherwise be entitled, the Corporation shall pay
to such holder cash in an amount equal to the market price of
the Common Stock as of the effective date of the conversion,
as such price shall be allocable to such fractional shares of
Common Stock. For purposes of this paragraph, the market price
per share of the Common Stock on any date shall be equal to
the average of the quoted prices of such shares for 30
consecutive trading days commencing 45 trading days before the
date in question. In the absence of one or more such
quotations, or in the absence of any trading market for such
shares, the Corporation shall determine the market price of
the Common Stock on the basis of such quotations, bid and
asked prices, or other information as it considers appropriate
and reasonable in light of the circumstances.
If the Series B Non-Voting Preferred Stock, in whole or in
part, is called for redemption, the right to convert such
Series B Non-Voting Preferred Stock into Common Stock ceases
at the close of business on the day prior to the Redemption
Date set in the notice of redemption.
(7) CONVERSION PROCEDURES. In order for the holders of the
Series B Non-Voting Preferred Stock to exercise their
conversion right and option, a holder of the Series B
Non-Voting Preferred Stock shall give written notice to the
Corporation stating that such holder thereby exercises its
conversion right and option and specifying the number of
shares of Series B Non-Voting Preferred Stock such holder
desires to convert at that time. Such notice shall be
accompanied by stock certificates representing the Series B
Non-Voting Preferred Stock then being converted, duly endorsed
for transfer to the Corporation. Each such conversion shall be
deemed effective on the date the Corporation receives such
notice and such stock certificates. Any notice given by any
holder of Series B Non-Voting Preferred Stock under this
paragraph shall be irrevocable, and all rights with respect to
Series B Non-Voting Preferred Stock converted into Common
Stock shall terminate as of the effective date of such
conversion, except the right to receive certificates
representing the Common Stock issuable upon such conversion.
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(8) ADJUSTMENTS TO CONVERSION PRICE. If the Corporation (a)
pays a dividend or makes a distribution on its Common Stock in
Common Stock; (b) subdivides its outstanding Common Stock into
a greater number of shares; (c) combines its outstanding
Common Stock into a smaller number of shares; (d) makes a
distribution on its Common Stock in shares of its capital
stock other than Common Stock; or (e) issues by
reclassification of its Common Stock any shares of its capital
stock, then the conversion privilege and the conversion price
in effect immediately before such action shall be adjusted so
that the holders of the Series B Non-Voting Preferred Stock
may thereafter receive the number of shares of Common Stock
which such holders would have owned immediately following such
action if they had converted the Series B Non-Voting Preferred
Stock immediately before such action.
If the Corporation merges or consolidates with another
corporation or sells or transfers all or substantially all of
its assets to another person and the holders of the Common
Stock are entitled to receive stock, securities, or property
in respect of or in exchange for Common Stock, then as a
condition of such merger, consolidation, sale or transfer, the
Corporation and any such successor, purchaser, or transferee
shall amend the Series B Non-Voting Preferred Stock to provide
that they may thereafter by converted in to the kind and
amount of stock, securities, or property receivable upon such
merger, consolidation, sale, or transfer by a holder of the
number of Common Stock into which the Series B Non-Voting
Preferred Stock might have been converted immediately before
such merger, consolidation, sale or transfer.
H. COMBINATION OF COMMON STOCK.
Effective as of the close of business on the fifth business
day after the date a certificate of amendment adding this
Section H to the Corporation's Second Amended and Restated
Articles of Incorporation is filed with the Secretary of State
of the State of Ohio (the "Effective Time"), each ten shares
of Common Stock outstanding immediately before the Effective
Time ("Old Common Stock") shall be changed into one share of
new Common Stock ("New Common Stock"). The changing of shares
of Old Common Stock into shares of New Common Stock shall be
referred to as the "Share Combination." The number of shares
of Common Stock authorized to be issued by the Corporation and
the par value thereof shall not be affected by the Share
Combination. No fractional shares of New Common Stock and no
certificate representing a fractional share of New Common
Stock shall be issued as a result of the Share Combination
and, in lieu of any such fractional share of New Common Stock,
each holder of a share of Old Common Stock who otherwise would
be entitled to receive a fractional share of New Common Stock
will be entitled to receive cash in an amount equal to the
market value of each share of Old Common Stock that would have
been converted into a fraction of a share of New Common Stock
but for this sentence, upon surrender of the certificate for
such Old Common Stock. For this purpose, the market value of
the shares of Old Common Stock shall be the unweighted
arithmetic mean of the bid prices of the Common Stock on the
over the counter market for the Common Stock for the five
trading day period ending at the Effective Time. Promptly
after the Effective Time, notice shall be given to the holders
of record of Common Stock at the Effective Time to surrender
their certificates for Common Stock for cancellation and
either issuance of new certificates or the payment of cash in
lieu of fractional shares, as the case may be, pursuant to the
Share Combination. The appropriate officers of the Corporation
are hereby empowered to adopt rules and regulations concerning
the surrender and payment for fractional shares resulting from
the Share Combination.
FIFTH: The Corporation, through its Board of Directors, shall have the
right and power to repurchase any of its outstanding shares at such times, for
such considerations and upon such terms and conditions as may be agreed upon
between the Corporation and the selling shareholder or shareholders.
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SIXTH: No holders of shares of the Corporation shall have any
pre-emptive right to subscribe for or to purchase any shares of the Corporation
of any class, whether now or hereafter authorized.
SEVENTH: Notwithstanding any provision of the Revised Code of Ohio, now
or hereafter in force, requiring for any purpose, the vote or consent of the
holders of shares entitling them to exercise two-thirds, or any other
proportion, of the voting power of the Corporation or of any class or classes of
shares thereof, such action, unless otherwise expressly required, may be taken
by the vote or consent of the holders of shares entitling them to exercise a
majority of the voting power of the Corporation, or of such class or classes of
shares thereof.
EIGHTH: No shareholder shall have the right to vote cumulatively in the
election of directors pursuant to, and in accordance with ss.1707.69(B)(10) of
the Ohio Revised Code.
NINTH: These First Amended and Restated Articles of Incorporation take
the place and supersede the existing Articles of Incorporation.
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