\n \n
CERTIFICATE OF DESIGNATION
OF
SERIES B CONVERTIBLE PREFERRED STOCK
OF
eUNIVERSE, INC.
<\/b><\/p>\n\neUniverse, Inc., a Delaware corporation (the \"Company<\/b>\"), hereby certifies that the following resolution was\nadopted by the sole Director of the Company, as required by Section 151 of the Delaware General Corporation Law pursuant to a written consent of the sole Director dated October 31, 2002: <\/p>\n\n\n
RESOLVED,\nthat pursuant to the authority expressly granted to and vested in the Board of Directors of the Company (the \"Board of\nDirectors<\/b>\") by the provisions of the Certificate of Incorporation of the Company (the \"Certificate of Incorporation<\/b>\"), there is\nhereby created, out of the 40,000,000 shares of preferred stock, par value $.10 per share, of the Company authorized in Article Fourth of the Certificate of Incorporation (the\n\"Preferred Stock<\/b>\"), a series of the Preferred Stock consisting of 4,098,335 shares, which series shall have the following powers, designations,\npreferences and relative, participating, optional or other rights, and the following qualifications, limitations and restrictions (in addition to any powers, designations, preferences and relative,\nparticipating, optional or other rights, and any qualifications, limitations and restrictions, set forth in the Certificate of Incorporation which are applicable to the Preferred Stock): <\/p>\n\n
Section 1. Designation of Amount<\/i>. <\/p>\n\n
The\nshares of Preferred Stock created hereby shall be designated the \"Series B Convertible Preferred Stock\" (the \"Series B Preferred\nStock<\/b>\") and the authorized number of shares constituting such series shall be 4,098,335. The Series B Preferred Stock shall rank senior to the Series A 6%\nConvertible Preferred Stock as to dividends, distributions or as to distributions of assets upon liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary. <\/p>\n\n
Section 2. Dividends<\/i>. <\/p>\n\n
(a) The\nholders of the then outstanding shares of Series B Preferred Stock will be entitled to receive, when, as and if declared by the Board of Directors out of\nfunds of the Company legally available therefor, non-cumulative cash dividends, accruing on a daily basis from the Original Issuance Date (as hereinafter defined) through and including the\ndate on which such dividends are paid at the annual rate of 8% (the \"Applicable Rate<\/b>\") of the Liquidation Preference (as hereinafter defined) per share\nof the Series B Preferred Stock. The term \"Original Issuance Date<\/b>\" means October 23, 2001. The cash dividends provided for in this\nSection 2(a) are hereinafter referred to as \"Base Dividends<\/b>.\" <\/p>\n\n
(b) In\naddition to Base Dividends, in the event any dividends are declared or paid or any other distribution is made on or with respect to the common stock, par value $.001\nper share (\"Common Stock<\/b>\"), the holders of the Series B Preferred Stock as of the record date established by the Board of Directors for such\ndividend or distribution on the Common Stock shall be entitled to receive as additional dividends (the \"Additional Dividends<\/b>\") an amount (whether in the\nform of cash, securities or other property) equal to the amount (and in the form) of the dividends or distribution that such holder would have received had the Series B Preferred Stock been\nconverted into Common Stock as of the date immediately prior to the record date of such dividend or distribution on the Common Stock, such Additional Dividends to be payable on the same payment date\nas the payment date for the dividend on the Common Stock established by the Board of Directors (the \"Additional Dividend Payment Date<\/b>\"); provided,\nhowever, that if the Company declares and pays a dividend or makes a distribution on the Common Stock consisting in whole or in part of Common Stock, then no such dividend or distribution shall be\npayable in respect of the Series B Preferred Stock on account of the portion of such dividend or distribution on the Common Stock payable in Common Stock and in lieu thereof the\nanti-dilution adjustment in Section 5(e) below shall apply. The record date for any such Additional Dividends shall be the record date for the applicable dividend or distribution on the Common Stock, and any such Additional Dividends shall be payable to the individual, entity or group (a\n\"Person<\/b>\") in whose name the Series B Preferred Stock is registered at the close of business on the applicable record date. <\/p>\n\n\n\n\n\n
(c) No\ndividend shall be paid or declared on any share of Common Stock (other than dividends payable in Common Stock for which an adjustment is made pursuant to\nSection 5(e)(iv) hereof), unless a dividend, payable in the same consideration and manner, is simultaneously paid or declared, as the case may be, on each share of Series B\nPreferred Stock in an amount determined as set forth in paragraph (b) above. For purposes hereof, the term \"dividends\" shall include any pro rata<\/i>\n\ndistribution by the Company, out of funds of the Company legally available therefor, of cash, property, securities (including, but not limited to, rights, warrants or options) or other property or\nassets to the holders of the Common Stock, whether or not paid out of capital, surplus or earnings. <\/p>\n\n\n
(d) Prior\nto declaring any dividend or making any distribution on or with respect to shares of Common Stock, the Company shall take all prior corporate action necessary to\nauthorize the issuance of any securities payable as a dividend in respect of the Series B Preferred Stock. <\/p>\n\n
Section 3. Liquidation Preference<\/i>. <\/p>\n\n
In\nthe event of a liquidation, dissolution or winding up of the Company, whether voluntary or involuntary (a \"Liquidation<\/b>\"), the holders\nof the Series B Preferred Stock then outstanding shall be entitled to receive out of the available assets of the Company, whether such assets are stated capital or surplus of any nature, an\namount on such date equal to $2.60 per share of Series B Preferred Stock plus the amount of any accrued and unpaid Base Dividends as of such date, calculated pursuant to Section 2 and\nany declared but unpaid Additional Dividends as of such date (collectively, the \"Liquidation Preference\"). Such payment shall be made before any payment shall be made or any assets distributed to the\nholders of any class or series of the Common Stock, the holders of the Series A 6% Convertible Preferred Stock or any other class or series of the Company's capital stock ranking junior as to\nliquidation rights to the Series B Preferred Stock. After the Liquidation Preference has been paid in full pursuant to this Section 3, the holders of the Series A 6% Convertible\nPreferred Stock shall be entitled to receive their liquidation preference as set forth in the First Amendment to the Certificate of Designation of the Series A 6% Convertible Preferred Stock.\nFollowing payment, first, to the holders of the Series B Preferred Stock of the full preferential amounts described in the first sentence of this Section 3 and, second, to the holders of\nthe Series A 6% Convertible Preferred Stock of the full preferential amounts described in the First Amendment to the Certificate of Designation of the Series A 6% Convertible Preferred\nStock, the remaining assets (if any) of the Company available for distribution to stockholders of the Company shall be distributed, subject to the rights of the holders of shares of any other series\nof Preferred Stock ranking prior to the Common Stock as to distributions upon Liquidation, pro rata among (i) the holders of the then outstanding shares of Series B Preferred Stock (as\nif the Series B Preferred Stock had been converted into Common Stock as of the date immediately prior to the date fixed for determination of stockholders entitled to receive such distribution)\nand (ii) the holders of the Common Stock and any other shares of capital stock of the Company ranking on a parity with the Common Stock as to distributions upon Liquidation. If upon any\nLiquidation the assets available for payment of the Liquidation Preference are insufficient to permit the payment to the holders of the Series B Preferred Stock of the full preferential amounts\ndescribed in this paragraph, then all the remaining available assets shall be distributed among the holders of the then outstanding Series B Preferred Stock pro rata according to the number of\nthen outstanding shares of Series B Preferred Stock held by each holder thereof. A Corporate Transaction (as hereinafter defined), shall at the election of the holders of a majority of the\nSeries B Preferred Stock outstanding at the time constitute a Liquidation for purposes of this Section 3, other than an Excluded Corporate Transaction. <\/p>\n\n
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Section 4. Voting Rights<\/i>. <\/p>\n\n
(a) Except\nas otherwise provided by applicable law and in addition to any voting rights provided by law, the holders of outstanding shares of the Series B Preferred\nStock: <\/p>\n\n\n\n
(i) shall\nbe entitled to vote together with the holders of the Common Stock as a single class on all matters submitted for a vote of holders of Common Stock; <\/p>\n\n
(ii) shall\nhave such other voting rights as are specified in the Certificate of Incorporation or as otherwise provided by Delaware law; and <\/p>\n\n
(iii) shall\nbe entitled to receive notice of any stockholders' meeting in accordance with the Certificate of Incorporation and By-laws of the Company. <\/p>\n\n
For\npurposes of the voting rights set forth in this Section 4(a), each share of Series B Preferred Stock shall entitle the holder thereof to cast one vote for each whole\nvote that such holder would be entitled to cast had such holder converted its Series B Preferred Stock into shares of Common Stock as of the date immediately prior to the record date for\ndetermining the stockholders of the Company eligible to vote on any such matter. <\/p>\n\n
(b) The\nholders of Series B Preferred Stock shall have the exclusive right, voting separately as a single class, to elect the following number of members of the Board\nof Directors: one (1) member in the event the Board of Directors consists of one (1) to five (5) members; two (2) members in the event the Board of Directors consists of\nsix (6) to eight (8) members; and three (3) members in the event the Board of Directors consists of nine (9) to eleven (11) members (each such member elected by the\nSeries B Preferred Stockholders, a \"Preferred Stock Director<\/b>\"). Except as permitted by Section 4(c) below in no event shall the total\nnumber of members of the Board of Directors exceed eleven (11). In any such election the holders of Series B Preferred Stock shall be entitled to cast one vote per share of Series B\nPreferred Stock held of record on the record date for the determination of the holders of Series B Preferred Stock entitled to vote on such election. The initial Preferred Stock Director(s)\nshall be Thomas Gewecke, and he is elected to serve until his successors are duly elected; and thereafter the Preferred Stock Directors shall be elected at the same time as other members of the Board\nof Directors. A Preferred Stock Director may only be removed by the written consent or affirmative vote of at least a majority of the Series B Preferred Stock. If for any reason a Preferred\nStock Director shall resign or otherwise be removed from the Board of Directors, then his or her replacement shall be a person elected by the holders of the Series B Preferred Stock, in\naccordance with the voting procedures set forth in this Section 4(b). The Preferred Stock Directors shall be appointed by the Board of Directors to serve on each committee of the Board of\nDirectors at least in the same proportions that the number of Preferred Stock Directors bears to the total number of directors then comprising the entire Board of Directors. <\/p>\n\n\n
(c) So\nlong as any shares of Series B Preferred Stock remain outstanding, the Company shall not, without the written consent or affirmative vote of the holders of at\nleast two-thirds of the outstanding shares of Series B Preferred Stock, (i) amend, alter, waive or repeal, whether by merger, consolidation,\ncombination, reclassification or otherwise, the Certificate of Incorporation, including this Certificate of Designation, or By-laws of the Company or any provisions thereof (including the\nadoption of a new provision thereof), (ii) create, authorize or issue any class, series or shares of Preferred Stock or any other class of capital stock ranking either as to payment of\ndividends, distributions or as to distributions of assets upon Liquidation (x) prior to the Series B Preferred Stock, or (y) on a parity with the Series B Preferred Stock\nor (iii) increase the size of the Board or Directors beyond eleven (11) members. The vote of the holders of at least two-thirds of the outstanding shares of Series B\nPreferred Stock, voting separately as one class, shall be necessary to adopt any alteration, amendment or repeal of any provision of this Resolution, in addition to any other vote of stockholders\nrequired by law. <\/p>\n\n
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(d) So\nlong as 550 Digital Media Ventures Inc. or any of its affiliates owns at least 1,442,308 shares of Series B Preferred Stock or Common Stock (as\nappropriately adjusted for any stock split, combination, reorganization, reclassification, stock dividend, stock distribution or similar event), the Company shall not, without the written consent or\naffirmative vote of at least two-thirds of the Board of Directors (i) enter into an agreement to, or consummate, a Corporate Transaction, (ii) enter into transactions which\nresult in or require the Company to issue shares of its capital stock in excess of 5% (in any one transaction) or 12.5% (in the aggregate, in a series of transactions commencing on or after the\nOriginal Issuance Date) of the Company's issued and outstanding shares of capital stock, (iii) enter into transactions which result in or require the Company to pay (whether in cash, stock or a\ncombination thereof) in excess of 5% (in any one transaction) or 12.5% (in the aggregate, in a series of transactions commencing on or after the Original Issuance Date) of the Company's\nthen-current market capitalization, (iv) increase or decrease the number of authorized shares of capital stock, (v) directly or indirectly declare or pay any dividend or make\nany other distribution in respect thereof, or directly or indirectly purchase, redeem, repurchase or otherwise acquire any shares of capital stock of the Company or any subsidiary, whether in cash or\nproperty or in obligations of the Company or any subsidiary, other than repurchases pursuant to an employee's employment or incentive agreement and upon an employee's termination and at a price not to\nexceed such employee's cost, (vi) increase or decrease the size of the Company's Board of Directors; provided that in no event shall the total number of members of the Board of Directors exceed\neleven (11). <\/p>\n\n
Section 5. Conversion Rights.<\/i><\/p>\n\n
(a) General.\nSubject to and upon compliance with the provisions of this Section 5, the holders of the shares of Series B Preferred Stock shall be entitled, at\ntheir option, at any time to convert all or any such shares of Series B Preferred Stock into a number of fully paid and non-assessable shares (calculated as to each conversion to\nthe nearest 1\/100,000th of a share) of Common Stock. The number of shares of Common Stock to which a holder of Series B Preferred Stock shall be entitled upon conversion shall be determined by\ndividing (x) the Liquidation Preference of such Series B Preferred Stock as of the Conversion Date (as hereinafter defined) by (y) the Conversion Price in effect at the close of\nbusiness on the Conversion Date (determined as provided in this Section 5). <\/p>\n\n
(b) Automatic\nConversion. Each share of Series B Preferred Stock shall automatically convert, immediately upon the earlier of (1) the written consent of\nholders of more than 50% of issued and\noutstanding Series B Preferred Stock, and (2) the Company Election (each, an \"Automatic Conversion Date<\/b>\") into fully paid and\nnon-assessable shares of Common Stock. The number of shares of Common Stock (calculated as to each conversion to the nearest 1\/100,000th of a share) to which a holder of Series B\nPreferred Stock shall be entitled upon such automatic conversion shall be determined by dividing (x) the Liquidation Preference of such Series B Preferred Stock as of the Automatic\nConversion Date by (y) the Conversion Price in effect at the close of business on the Business Day immediately preceding such closing date. Such conversion shall occur automatically and without\nany further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent. Upon the occurrence of such\nautomatic conversion of the Series B Preferred Stock, the holders of Series B Preferred Stock shall surrender the certificates representing such shares at the office of the Company or\nany transfer agent for the Series B Preferred Stock. Thereupon, there shall be issued and delivered to such holder promptly at such office and in its name as shown on such surrendered\ncertificate or certificates, a certificate or certificates for the number of shares of Common Stock into which the shares of Series B Preferred Stock surrendered were convertible on the date on\nwhich such automatic conversion occurred. <\/p>\n\n
(c) Conversion\nPrice. The conversion price (the \"Conversion Price<\/b>\") shall initially be $2.60, subject to adjustment from time\nto time in accordance with Section 5(e). <\/p>\n\n
(d) Fractions\nof Shares. Unless the holder of shares of Series B Preferred Stock being converted specifies otherwise, the Company shall issue fractional shares of\nCommon Stock (carried out to seven <\/p>\n\n
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\ndecimal places) upon conversion of shares of Series B Preferred Stock. If more than one share of Series B Preferred Stock shall be surrendered for conversion at one time by the same\nholder, the number of full shares of Common Stock to be issued shall be computed on the basis of the aggregate number of shares of Series B Preferred Stock so surrendered. Instead of any\nfractional shares of Common Stock which would otherwise be issuable upon conversion of any shares of Series B Preferred Stock, the Company shall pay a cash adjustment in respect of such\nfractional share in an amount equal to the product of such fraction multiplied by the Fair Market Value (as hereinafter defined) of one share of Common Stock on the Conversion Date. <\/p>\n\n
(e) Adjustments\nto Conversion Price. The Conversion Price shall be subject to adjustment from time to time as follows: <\/p>\n\n\n\n
(i) Upon\nIssuance of Common Stock. If the Company shall, at any time or from time to time after the Original Issuance Date, issue any shares of Common Stock (other than an\nissuance of Common Stock as a dividend or in a split of or subdivision in respect of which the adjustment provided for in Section 5(e)(iv) applies), options to purchase or rights to\nsubscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock, or options to purchase or rights to subscribe for such convertible or exchangeable securities\n(other than Excluded Stock (as defined below)) without consideration or for consideration per share less than the Conversion Price in effect\nimmediately prior to such issuance, then such Conversion Price shall forthwith be lowered to a price equal to the price obtained by multiplying: <\/p>\n\n\n\n\n
(A) the\nConversion Price in effect immediately prior to the issuance of such Common Stock, options, rights or securities by <\/p>\n\n
(B) a\nfraction of which (x) the denominator shall be the number of shares of Common Stock outstanding on a fully-diluted basis immediately after such issuance and\n(y) the numerator shall be the sum of (i) the number of shares of Common Stock outstanding on a fully-diluted basis immediately prior to such issuance and (ii) the number of\nadditional shares of Common Stock which the aggregate consideration for the number of shares of Common Stock so offered would purchase at the Conversion Price. <\/p>\n\n
For\npurposes of this Section 5(e), \"fully diluted basis\" shall be determined in accordance with the treasury stock method of computing fully diluted earnings per share in\naccordance with GAAP. <\/p>\n\n\n\n
(ii) Upon\nAcquisition of Common Stock. If the Company or any subsidiary shall, at any time or from time to time after the Original Issuance Date, directly or indirectly,\nredeem, purchase or otherwise acquire any shares of Common Stock, options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common\nStock (other than shares of Series B Preferred Stock that are redeemed according to their terms), or options to purchase or rights to subscribe for such convertible or exchangeable securities,\nfor a consideration per share greater than the Fair Market Value (plus, in the case of such options, rights, or securities, the additional consideration required to be paid to the Company upon\nexercise, conversion or exchange) per share of Common Stock immediately prior to such event, then the Conversion Price shall forthwith be lowered to a price equal to the price obtained by multiplying: <\/p>\n\n\n\n\n\n
(A) the\nConversion Price in effect immediately prior to such event by <\/p>\n\n
(B) a\nfraction of which (x) the denominator shall be the Fair Market Value per share of Common Stock immediately prior to such event and (y) the numerator\nshall be the result of dividing: <\/p>\n\n\n\n
a) (1)\nthe product of (A) the number of shares of Common Stock outstanding on a fully-diluted basis and (B) the Fair Market Value per share of Common Stock, <\/p>\n\n
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\nin each case immediately prior to such event, minus (2) the aggregate consideration paid by the Company in such event (plus, in the case of such options, rights, or convertible or exchangeable\nsecurities, the aggregate additional consideration to be paid by the Company upon exercise, conversion or exchange), by <\/p>\n\n
b) the\nnumber of shares of Common Stock outstanding on a fully-diluted basis immediately after such event. <\/p>\n\n
(iii) For\nthe purposes of any adjustment of a Conversion Price pursuant to paragraphs (1) of this Section 5(e), the following provisions shall be applicable: <\/p>\n\n\n\n
(1) In\nthe case of the issuance of Common Stock for cash in a public offering or private placement, the consideration shall be deemed to be the amount of cash paid therefor\nbefore deducting therefrom any discounts, commissions or placement fees payable by the Company to any underwriter or placement agent in connection with the issuance and sale thereof. <\/p>\n\n\n
(2) In\nthe case of the issuance of Common Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the Fair\nMarket Value thereof. <\/p>\n\n
(3) In\nthe case of the issuance of options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock,\nor options to purchase or rights to subscribe for such convertible or exchangeable securities (except for options to acquire Excluded Stock): <\/p>\n\n\n\n
(A) the\naggregate maximum number of shares of Common Stock deliverable upon exercise of such options to purchase or rights to subscribe for Common Stock shall be deemed to\nhave been issued at the time such options or rights were issued and for a consideration equal to the consideration (determined in the manner provided in subparagraphs (i) and\n(ii) above), if any, received by the Company upon the issuance of such options or rights plus the minimum purchase price provided in such options or rights for the Common Stock covered thereby; <\/p>\n\n
(B) the\naggregate maximum number of shares of Common Stock deliverable upon conversion of or in exchange for any such convertible or exchangeable securities or upon the\nexercise of options to purchase or rights to subscribe for such convertible or exchangeable securities and subsequent conversion or exchange thereof shall be deemed to have been issued at the time\nsuch securities, options, or rights were issued and for a consideration equal to the consideration received by the Company for any such securities and related options or rights (excluding any cash\nreceived on account of accrued interest or accrued dividends), plus the additional consideration, if any, to be received by the Company upon the conversion or exchange of such securities or the\nexercise of any related options or rights (the consideration in each case to be determined in the manner provided in paragraphs (i) and (ii) above); <\/p>\n\n
(C) on\nany change in the number of shares or exercise price of Common Stock deliverable upon exercise of any such options or rights or conversions of or exchanges for such\nsecurities, other than a change resulting from the anti-dilution provisions thereof, the applicable Conversion Price shall forthwith be readjusted to such Conversion Price as would have\nbeen obtained had the adjustment made upon the issuance of such options, rights or securities not converted prior to such change or options or rights related to such securities not converted prior to\nsuch change been made upon the basis of such change; and <\/p>\n\n
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(D) no\nfurther adjustment of the Conversion Price adjusted upon the issuance of any such options, rights, convertible securities or exchangeable securities shall be made as\na result of the actual issuance of Common Stock on the exercise of any such rights or options or any conversion or exchange of any such securities. <\/p>\n\n
(iv) Upon\nStock Dividends, Subdivisions or Splits. If, at any time after the Original Issuance Date, the number of shares of Common Stock outstanding is increased by a stock\ndividend payable in shares of Common Stock or by a subdivision or split-up of shares of Common Stock, then, following the record date for the determination of holders of Common Stock\nentitled to receive such stock dividend, or to be affected by such subdivision or split-up, the Conversion Price shall be appropriately decreased so that the number of shares of Common\nStock issuable on conversion of Series B Preferred Stock shall be increased in proportion to such increase in outstanding shares. <\/p>\n\n\n
(v) Upon\nCombinations. If, at any time after the Original Issuance Date, the number of shares of Common Stock outstanding is decreased by a combination of the outstanding\nshares of Common Stock into a smaller number of shares of Common Stock, then, following the record date to determine shares affected by such combination, the Conversion Price shall be appropriately\nincreased so that the number of shares of Common Stock issuable on conversion of each share of Series B Preferred Stock shall be decreased in proportion to such decrease in outstanding shares. <\/p>\n\n
(vi) Upon\nReclassifications, Reorganizations, Consolidations or Mergers. In the event of any capital reorganization of the Company, any reclassification of the stock of the\nCompany (other than a change in par value or from par value to no par value or from no par value to par value or as a result of a stock dividend or subdivision, split-up or combination of\nshares), or any consolidation or merger of the Company with or into another corporation (where the Company is not the surviving corporation or where there is a change in or distribution with respect\nto the Common Stock), each share of Series B Preferred Stock shall after such reorganization, reclassification, consolidation, or merger be convertible into the kind and number of shares of\nstock or other securities or property of the Company or of the successor corporation resulting from such consolidation or surviving such merger, if any, to which the holder of the number of shares of\nCommon Stock deliverable (immediately prior to the time of such reorganization, reclassification, consolidation or merger) upon conversion of such Series B Preferred Stock would have been\nentitled upon such reorganization, reclassification, consolidation or merger. The provisions of this clause shall similarly apply to successive reorganizations, reclassifications, consolidations, or\nmergers. The Company shall not effect any such reorganization, reclassification,\nconsolidation or merger unless, prior to the consummation thereof, the successor corporation (if other than the Company) resulting from such reorganization, reclassification, consolidation, shall\nassume, by written instrument, the obligation to deliver to the holders of the Series B Preferred Stock such shares of stock, securities or assets, which, in accordance with the foregoing\nprovisions, such holders shall be entitled to receive upon such conversion. <\/p>\n\n\n
(vii) Deferral\nin Certain Circumstances. In any case in which the provisions of this Section 5(e) shall require that an adjustment shall become effective immediately\nafter a record date of an event, the Company may defer until the occurrence of such event: <\/p>\n\n\n\n
(1) issuing\nto the holder of any Series B Preferred Stock converted after such record date and before the occurrence of such event the shares of capital stock\nissuable upon such conversion by reason of the adjustment required by such event and issuing to such holder only the shares of capital stock issuable upon such conversion before giving effect to such\nadjustments, and <\/p>\n\n
(2) paying\nto such holder any amount in cash in lieu of fractional share of capital stock pursuant to Section 5(d) above; <\/p>\n\n
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provided,\nhowever, that the Company shall deliver to such holder an appropriate instrument or due bills evidencing such holder's right to receive such additional shares and such cash. <\/p>\n\n
(viii) Other\nAnti-Dilution Provisions. If the Company has issued or issues any securities on or after the Original Issuance Date containing\nprovisions protecting the holder or holders thereof against dilution in any manner more favorable to such holder or holders thereof than those set forth in this Section 5, such provisions (or\nany more favorable portion thereof) shall be deemed to be incorporated herein as if fully set forth herein and, to the extent inconsistent with any provision herein, shall be deemed to be substituted\ntherefor. <\/p>\n\n
(ix) Appraisal\nProcedure. In any case in which the provisions of this Section 5(e) shall necessitate that the Appraisal Procedure be utilized for purposes of\ndetermining an adjustment to the Conversion Price, the Company may defer until the completion of the Appraisal Procedure and the determination of the adjustment: <\/p>\n\n\n\n
(1) issuing\nto the holder of any share of Series B Preferred Stock converted after the date of the event that requires the adjustment and before completion of the\nAppraisal Procedure and the determination of the adjustment, the shares of capital stock issuable upon such conversion by reason of the\nadjustment required by such event and issuing to such holder only the shares of capital stock issuable upon such conversion before giving effect to such adjustment and <\/p>\n\n\n
(2) paying\nto such holder any amount in cash in lieu of a fractional share of capital stock pursuant to Section 5(d) above; provided, however, that the Company shall\ndeliver to such holder an appropriate instrument or due bills evidencing such holder's right to receive such additional shares and such cash. <\/p>\n\n
(x) Exceptions.\nSection 5(e) shall not apply to (i) any issuance of Common Stock upon any grant or exercise of any warrants or options awarded to employees or\ndirectors of the Company pursuant to an employee stock option plan or stock incentive plan approved by the Board of Directors, (ii) any issuance of Common Stock upon conversion of the Preferred\nStock, (iii) upon approval by the Preferred Stockholder, (x) any issuance of Common Stock or any grant of any warrants or options to purchase Common Stock as payment for services or\ncompensation or (y) in connection with an asset or stock acquisition (collectively, the \"Excluded Stock<\/b>\"). <\/p>\n\n
(f) Exercise\nof Conversion Privilege. <\/p>\n\n\n\n
(i) Except\nin the case of an automatic conversion pursuant to Section 5(b), in order to convert shares of Series B Preferred Stock, a holder must\n(A) surrender the certificate or certificates evidencing such holder's shares of Series B Preferred Stock to be converted, duly endorsed in a form satisfactory to the Company, at the\noffice of the Company and (B) notify the Company at such office that such holder elects to convert Series B Preferred Stock and the number of shares such holder wishes to convert. Such\nnotice referred to in clause (B) above shall be delivered substantially in the following form: <\/p>\n\n
\"NOTICE\nTO EXERCISE CONVERSION RIGHT <\/p>\n\n
The\nundersigned, being a holder of the Series B Convertible Preferred Stock of eUniverse, Inc. (the \"Convertible Preferred\nStock<\/b>\"), irrevocably exercises the right to convert outstanding shares of\nConvertible Preferred Stock on , ,\ninto shares of Common\nStock of eUniverse, Inc. In accordance with the terms of the shares of Convertible Preferred Stock, and directs that the shares issuable and deliverable upon the conversion be issued and\ndelivered in the denominations indicated below to the registered holder hereof unless a different name has been indicated below. <\/p>\n\n
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Dated:\n[At least one Business Day prior to the date fixed for conversion] <\/p>\n\n
Fill\nin for registration of
\nshares of Common Stock
\nif to be issued other than
\n\nto the registered holder: <\/p>\n\n<\/pre>\n
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| \nAddress<\/td>\n | <\/td>\n | <\/p>\n<\/td>\n<\/tr>\n | |||||||
| \nPlease print name and \naddress, including postal \ncode number<\/td>\n | <\/td>\n | \n(Signature)<\/td>\n<\/tr>\n | |||||||
| <\/p>\n Denominations: “<\/td>\n | <\/td>\n | \n <\/td>\n<\/tr>\n<\/table>\n (ii) Series B (iii) In (g) Notice (h) Notice 9<\/p>\n \nmaximum number of shares being sought or the amount or type of consideration being offered therefor); then the Company shall cause to be filed at each office or agency maintained for such purpose, (i) Company Before (j) Taxes (k) Cancellation (l) Certain “Appraisal Procedure<\/b>” if applicable, means the following procedure to determine the fair market value, as to any security, for purposes of 10<\/p>\n \nmore than 50% of the issued and outstanding shares of Series B Preferred Stock (the “Majority Holder<\/b>“); provided, however, that if such parties “Business Day<\/b>” means a day other than a Saturday, Sunday or day on which banking institutions in New York are authorized or required to “Company Election<\/b>” means the election by the Company to exercise its right to convert the Series B Preferred Stock into Common “Corporate Transaction<\/b>” means a reorganization, merger, change of control or consolidation of the Company or sale or other disposition of “Excluded Corporate Transaction<\/b>” means a Corporate Transaction pursuant to which the individuals or entities who are the beneficial 11<\/p>\n \nownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be. <\/p>\n “Fair Market Value”<\/b> means, as to any security, the Twenty Day Average of the average closing prices of such security’s sales on all “GAAP<\/b>” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of “Operating Profits<\/b>” means earnings before interest, taxes and purchase price amortization, adjusted to exclude non-recurring “Outstanding Company Common Stock<\/b>” means the then outstanding shares of Common Stock. <\/p>\n “Outstanding Company Voting Securities<\/b>” means the combined voting power of the then outstanding securities of the Company entitled to vote “Twenty Day Average<\/b>” means, with respect to any prices and in connection with the calculation of Fair Market Value, the average of such “Voting Stock”<\/b> shall mean shares of Common Stock, Preferred Stock and any other class of securities of the Company having the power to 12<\/p>\n \nVoting Stock). Each share of Common Stock shall count as one share of Voting Stock, each share of Preferred Stock shall count as a number of shares of Voting Stock equal to the number of shares of “Voting Stock Equivalents”<\/b> means any right, warrant, option or security of the Company which is exercisable or exchangeable for or Section 6. Dividend Received Deduction.<\/i><\/p>\n For Section 7. Preemptive Rights<\/i>. <\/p>\n In 13<\/p>\n IN Secretary, Senior Vice President and 14<\/p>\n Exhibit 3.3<\/p>\n CERTIFICATE OF DESIGNATION OF SERIES B CONVERTIBLE PREFERRED STOCK OF eUNIVERSE, INC.<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7885],"corporate_contracts_industries":[9497],"corporate_contracts_types":[9562,9560],"class_list":["post-40898","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-intermix-media-inc","corporate_contracts_industries-retail__electronics","corporate_contracts_types-finance__desig","corporate_contracts_types-finance"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40898","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40898"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40898"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40898"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40898"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}} |