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EXHIBIT
3.4
CERTIFICATE OF DESIGNATION OF POWERS,
PREFERENCES AND RIGHTS OF
SERIES B CONVERTIBLE PREFERRED STOCK
OF
YOUNGEVITY INTERNATIONAL, INC.
a Delaware corporation
ADOPTED IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 151 OF THE
DELAWARE GENERAL CORPORATION LAW
Youngevity
International, Inc., a Delaware corporation (the
“Corporation”),
pursuant to Section 151 of the General Corporation Law of the State
of Delaware, certifies that the directors of the Corporation have
unanimously adopted the resolutions attached hereto as Appendix I providing for the
issuance of 1,052,631 shares of Series B Convertible Preferred
Stock.
The
undersigned certifies that he is the duly elected President of the
Corporation.
IN WITNESS WHEREOF, the Corporation has
caused this Certificate to be executed by David Briskie, its
President, this ____ day of _______, 2018.
YOUNGEVITY INTERNATIONAL, INC.
By:
_/s/ David
Briskie
David Briskie
President
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APPENDIX I
The
undersigned, being all of the members of the Board of Directors of
Youngevity, Inc. (the “Corporation”), do hereby
consent to the following actions and adopt the following preamble
and resolutions by written consent pursuant to Section 141(f) of
the Delaware General Corporation Law:
WHEREAS, the Certificate of
Incorporation (the “Certificate”) of the
Corporation provides for a class of stock designated as preferred
stock, par value $.001 per share (the “Preferred Stock”),
comprising 5,000,000 shares, issuable from time to time and in one
or more series and authorizes the Board of Directors (the
“Board”) of the
Corporation to fix or alter the rights, preferences, privileges and
restrictions granted to or imposed upon any wholly unissued series
of Preferred Stock and the number of shares constituting any such
series and the designations thereof; and
WHEREAS, the Certificate also provides
for a class of stock designated as common stock, $.001 par value
per share, comprising 50,000,000 shares (the “Common Stock”). The term
“Common Stock” when used in this resolution with
reference to the Common Stock into which a share of Preferred Stock
is convertible, shall mean only Common Stock of the Corporation,
$.001 par value per share, and any stock into which the Common
Stock may hereafter be changed; and
WHEREAS, it is the desire of the Board
to authorize the issuance of a series of Preferred Stock and to
determine the rights, preferences, privileges, restrictions and
other matters relating to the series of Preferred
Stock.
NOW, THEREFORE, IT IS RESOLVED that the
Corporation does hereby provide for the issuance of a series of
convertible Preferred Stock of the Corporation, consisting of
1,052,631 shares which
shall be designated as “Series B Convertible Preferred
Stock”, and does hereby fix and determine the powers,
preferences and rights relating to said Series B Convertible
Preferred Stock:
SERIES
B CONVERTIBLE PREFERRED STOCK
1.
Designation of Shares;
Rank.
(a.)
This
series of preferred stock shall be designated and known as Series B
Convertible Preferred Stock (the “Series B Preferred
Stock”). The number of shares constituting the Series
B Preferred Stock shall be 1,052,631 shares, par value $.001 per
share.
(b.)
Except
as otherwise provided herein, so long as any Series B Preferred
Stock is outstanding, with respect to redemption rights, dividends,
rights on Liquidation (as hereinafter defined), winding up,
corporate reorganization and dissolution, the Series B Preferred
Stock shall rank senior to the Common Stock, the Series A
Convertible Preferred Stock (the “Series A Preferred
Stock”) and any other class or series of stock ranking
junior to the Series B Preferred Stock.
2.
Conversion. The holders of shares of Series B Preferred
Stock shall have the following conversion rights:
(a.)
Right to Convert. Subject to the terms and conditions of
this paragraph 2(a), each holder of any shares of the Series B
Preferred Stock shall have the right, at his, her or its option, at
any time and from time to time and without the payment of
additional consideration by the holder thereof, to convert each
share of Series B Preferred Stock held by such holder into such
number of shares of Common Stock as is determined by dividing $9.50
together with all accrued or declared and unpaid dividends of the
Series B Preferred by the Conversion Price (as defined below). Such
right of conversion shall be exercised by the holder hereof by
giving written notice that the holder elects to convert a stated
number of shares of Series B Preferred Stock into Common Stock and
by surrender of a certificate or certificates for the shares to be
converted to the Corporation at its principal office (or such other
office or agency of the Corporation as the Corporation may
designate in writing to the holders of Series B Preferred Stock) in
which the certificate or certificates for shares of Common Stock
shall be issued. If required by the Corporation, any certificate
for shares surrendered for conversion shall be accompanied by
instruments of transfer, in a form reasonably satisfactory to the
Corporation, duly executed by the holder of such Series B Preferred
Shares or his, her or its duly authorized
representative.
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(b.)
Automatic Conversion. Each outstanding share of Series B
Preferred Stock, on the two-year anniversary of its respective
original issuance date, shall convert into such number of shares of
Common Stock as is determined by dividing $9.50 by the Conversion
Price.
(c.)
Mechanics of Conversion. All shares of Series A Convertible
Preferred Stock which shall have been surrendered for conversion as
herein provided shall no longer be deemed to be outstanding and all
rights with respect to such shares, including the rights, if any,
to receive notices and to vote, shall immediately cease and
terminate on the Conversion Date at the time of conversion, except
only the right of the holders thereof to receive shares of Common
Stock in exchange therefor, to receive payment in lieu of any
fraction of a share otherwise issuable upon such conversion and
payment of any dividends declared but unpaid on the Series A
Convertible Preferred Stock. Any shares of Series A Convertible
Preferred Stock so converted shall be retired and canceled and
return to the status of and constitute authorized but unissued
shares of Preferred Stock, without classification as to series
until such shares are once more classified as a particular series
by the Board of Directors pursuant to the provisions of the
Certificate of Incorporation.
(d.)
Issuance of Certificates; Time Conversion Effected. Promptly
after the conversion of Series B Preferred Stock and surrender to
it of the certificate or certificates for the share or shares of
Series B Preferred Stock to be converted, the Corporation shall
issue and deliver, or cause to be issued and delivered, to the
holder, registered in such name or names as such holder may direct,
a certificate or certificates for the number of whole shares of
Common Stock issuable upon the conversion of such share or shares
of Series B Preferred Stock. To the extent permitted by law, such
conversion shall be deemed to have been effected as of the close of
business on the later of the date on which such written notice
shall have been received by the Corporation and the certificate or
certificates for such share or shares shall have been surrendered
as aforesaid, and at such time the rights of the holder of such
share or shares of Series B Preferred Stock shall cease, and the
person or persons in whose name or names any certificate or
certificates for shares of Common Stock shall be issuable upon such
conversion shall be deemed to have become the holder or holders of
record of the shares of Common Stock represented
thereby.
(e.)
No Fractional Shares; Dividends, Partial Conversion. No
fractional shares shall be issued upon conversion of Series B
Preferred Stock into Common Stock and no payment or adjustment
shall be made upon any conversion on account of any cash dividends
on the Common Stock issued upon such conversion. At the time of
each conversion pursuant to subparagraph 2(a) or 2(b), the
Corporation shall pay, to the extent permitted by law, in cash an
amount equal to all accrued and unpaid dividends on the shares of
Series B Preferred Stock surrendered for conversion to the date
upon which such conversion is deemed to take place as provided in
subparagraph 2(c). In case the number of shares of Series B
Preferred Stock represented by the certificate or certificates
surrendered exceeds the number of shares converted, the Corporation
shall, upon such conversion, execute and deliver to the holder, at
the expense of the Corporation, a new certificate or certificates
for the number of shares of Series B Preferred Stock represented by
the certificate or certificates surrendered which are not to be
converted. If any fractional share of Common Stock would, except
for the provisions of the first sentence of this subparagraph 2(d),
be delivered upon such conversion, the Corporation, in lieu of
delivering such fractional share, shall pay, to the extent
permitted by law, to the holder surrendering the Series B Preferred
Stock for conversion an amount in cash equal to the current fair
market value of such fractional share as determined in good faith
by the Board.
(f.)
Conversion Price. The initial Conversion Price is
$4.75.
(g.)
Adjustment to Conversion Price by Reason of Stock Split, Stock
Dividend, Recapitalization, Merger, etc. In the event of any
change in the outstanding shares of Series B Preferred Stock or
Common Stock of the Corporation by reason of any stock split, stock
dividend, recapitalization, merger, consolidation, combination or
exchange of shares or other similar change in the capital structure
of the Corporation, the Board shall make such equitable adjustments
to the Conversion Price as it determines, in its sole discretion,
are necessary and appropriate in order to preserve the intrinsic
value of the Series B Preferred Stock. Any such adjustments shall
be set forth in a written notice to the holders of Series B
Preferred Stock and shall be conclusive and binding on each
holder.
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3.
Liquidation.
(a.)
Upon
any liquidation, dissolution or winding up of the Corporation,
either voluntary or involuntary (a “Liquidation”), the
holders of Series B Preferred Stock shall first be entitled to
receive, out of the assets of the Corporation available for
distribution to its stockholders, before any distribution or
payment is made or any asset distributed to the holders of Common
Stock, the Series A Preferred Stock or any other class or series of
stock ranking junior to the Series B Preferred Stock, but subject
to the rights of holders of any other then outstanding shares of
preferred stock, the pari passu rights of
holders of any then outstanding shares of Series B Preferred Stock
and the rights of holders of any then outstanding shares of any
other series of stock ranking pari passu with
respect to the Liquidation rights of the Series B Preferred Stock,
to be paid an amount equal to $9.50 for each and every share of
Series B Preferred Stock held by the holders of Series B Preferred
Stock, plus all accrued and unpaid dividends (the
“Series B
Liquidation Payment”).
(b.)
If upon
such Liquidation, the assets to be distributed among the holders of
Series B Preferred Stock shall be insufficient to permit payment in
full to the holders of Series B Preferred Stock and the holders of
any securities ranking pari passu as to
liquidation rights with the Series B Preferred Stock, then the
assets available for payment or distribution to such holders shall
be allocated among the holders of the Series B Preferred Stock and
such holders of securities pari passu with the
Series B Preferred Stock in proportion to the full respective
preferential amounts to which each are entitled.
(c.)
Upon a
Liquidation, immediately after the holders of Series B Preferred
Stock and the holders of securities ranking pari passu with the
Series B Preferred Stock shall have been paid in full the Series B
Liquidation Payments, then the amount of the remaining assets of
the Corporation legally available for distribution, if any, shall
be distributed among the holders of any securities junior to the
Series B Preferred Stock in accordance with their respective
priorities.
(d.)
After
full payment of the Series B Liquidation Payment as set forth
above, such shares of Series B Preferred Stock shall no longer be
deemed to be outstanding and the holders thereof shall have no
further rights as holders of Series B Preferred Stock.
4.
Voting.
(a.)
Except
as otherwise provided herein or as otherwise required by law, the
Series B Preferred Stock shall have no voting rights. However, as
long as any shares of Series B Preferred Stock are outstanding, the
Corporation shall not, without the affirmative vote of the holders
of a majority of the then outstanding shares of the Series B
Preferred Stock alter or change adversely the powers, preferences
or rights given to the Series B Preferred Stock or alter or amend
this Certificate of Designation.
5.
Dividends.
(a.)
Commencing
on the date of the initial issuance of the Series B Preferred
Stock, a holder of record of shares of Series B Preferred Stock
shall be entitled to receive, out of any funds at the time legally
available therefor, a cash dividend at the per annum rate of an
amount equal to the product of five percent (5%) and $9.50 per
share of the Series B Preferred Stock owned by such holder, subject
to adjustment in the event of a stock dividend stock split or other
similar event. Dividends on the Series B Preferred Stock shall be
cumulative, shall accrue and shall be payable to holders quarterly
in arrears, on or about the last day of March, June, September and
December of each year, commencing June 30, 2018, or, if such day is
not a business day, on either the immediately preceding business
day or next succeeding business day at the Corporation’s
option, except that, if such business day is in the next succeeding
year, such payment shall be made on the immediately preceding
business day, in each case with the same force and effect as if
made on such date. The term “business day” means each
day, other than a Saturday or a Sunday, which is not a day on which
banks in New York are required to close.
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(b.)
Dividends
on the Series B Preferred Stock are prior and in preference to any
declaration or payment of any distribution on any outstanding
shares of Common Stock, the Series A Preferred Stock or any other
class or series of stock ranking junior to the Series B Preferred
Stock. Such dividends shall accrue on each share of Series B
Preferred Stock whether or not earned or declared. In the case of
Series B Preferred Stock outstanding for less than a full quarter,
dividends shall be pro rata based on
the portion of the quarter during which such shares are
outstanding.
(c.)
So long
as any shares of Series B Preferred Stock are outstanding, the
Corporation shall not declare, pay or set apart for payment any
dividend or make any distribution on Common Stock or other class or
series of stock ranking junior to the Series B Preferred Stock
(other than dividends or distributions payable in additional shares
of junior stock), unless at the time of such dividend or
distribution the Corporation shall have paid all accrued and unpaid
dividends on the outstanding shares of Series B Preferred
Stock.
(d.)
Notwithstanding
the foregoing, if the aggregate amount of dividends then accrued
and payable to a holder is less than $10.00, the Corporation may,
at its option, retain and not make payment in respect of such
dividends until the aggregate amount of dividends then accrued and
payable to the holder is not less than $10.00.
RESOLVED, that the officers of the Corporation are
authorized to file with the Secretary of State of Delaware a
Certificate of Designation providing for the issuance of the series
of stock designated in the foregoing resolution and that each of
the officers of the Corporation is individually authorized,
empowered and directed, in the name and on behalf of the
Corporation, to take all such further actions and execute and
deliver all such further documents and instruments as such officer
may approve as necessary or desirable to carry out the intent and
purpose of the foregoing resolutions, the taking of any action or
the execution and delivery of any document or instrument by that
officer to be conclusive evidence of that approval.
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