EXECUTION COPY
SHARE EXCHANGE AGREEMENT
SHARE EXCHANGE AGREEMENT, dated as of April 27, 2001 (the "Agreement"),
between Westar Investments, Inc., a Delaware corporation ("Westar"), and
Guardian International Inc., a Florida Corporation ("Guardian").
RECITALS
A. Westar desires to exchange 8,000 shares of Guardian Series C 7% Redeemable
Cumulative Preferred Stock, par value $.001 per share ("Series C Preferred
Stock") for 8,000 shares of Guardian Series E 7% Cumulative Preferred Stock, par
value $.001 per share ("Series E Preferred Stock").
B. Guardian desires to exchange its shares of Series E Preferred Stock as stated
hereinabove in exchange for its receipt of the Series C Preferred Stock.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. THE EXCHANGE
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1.1. Closing. The closing of the transaction contemplated in this
Agreement (the "Closing") shall take place at the offices of Guardian at 0000 X.
00xx Xxxxxxx, Xxxxxxxxx, Xxxxxxx, 00000, at 2:00 p.m., (or at such other place
as shall be mutually acceptable to the parties) on the 27th day of April, 2001
(the "Closing Date").
1.2. Exchange. In reliance on and subject to the terms, conditions,
representations, warranties, covenants and agreements herein contained, Guardian
shall issue to Westar 8,000 shares of its newly issued Series E Preferred Stock
in exchange for the receipt of 8,000 shares of Series C Preferred Stock from
Westar. The Series E Preferred Stock will have the terms and conditions set
forth in the Articles of Amendment to the Articles of Incorporation attached as
Exhibit A hereto.
1.3. Mechanism of Exchange.
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(a). At the Closing, Westar shall deliver to Guardian a
certificate representing 8,000 shares of Series C Preferred Stock, duly endorsed
for transfer.
(b). At the Closing, Guardian shall deliver to Westar 8,000 shares
of newly issued Series E Preferred Stock. The Series E Preferred Stock shall
bear an appropriate legend restricting the transfer except as permitted under
Rule 144 of the Securities Act of 1933, as amended.
2. Representations and Warranties of Guardian.
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Guardian represents, covenants and warrants to Westar as follows:
2.1. Corporate Existence/Standing/Authority. Guardian is a corporation
duly organized, validly existing, and in good standing under the laws of
Florida, and has all necessary corporate power and authority to own, operate and
lease its properties and, to carry on its business as now being conducted, and
to enter into this Agreement and to carry the transactions contemplated hereby.
Guardian is duly qualified to do business and is in good standing in each
jurisdiction where the failure to qualify would have a material adverse effect
on it.
2.2. Capitalization. the authorized capital stock of Guardian consists
of (i) 100,000,000 shares of `Class A Voting Common Stock', par value $.001 per
share of which, as of the date hereof, 8,096,441 shares are outstanding; all of
such outstanding shares have been validly issued and are fully paid and
nonassessable; (ii) 1,000,000 shares of `Class B Nonvoting Common Stock', par
value $.001 per share of which, as of the date hereof, 634,035 shares are
outstanding; all of such outstanding shares have been validly issued and are
fully paid and nonassessable; and (iii) 30,000,000 shares of Preferred Stock,
par value $.001 per share of which, as of the date hereof, 16,397 shares have
been designated as Series C 7% Redeemable Cumulative Preferred Stock and of
which 8,397 are outstanding; 30,000 shares have been designated as Series D 6%
Convertible Cumulative Preferred Stock and of which 11,369 are outstanding; and
16,397 shares have been designated as Series E 7% Cumulative Preferred Stock and
of which 8,000 are outstanding; all of such outstanding shares have been validly
issued and are fully paid and nonassessable.
2.3. Authorization; Binding Effect; No Conflict. The execution,
delivery and performance of this Agreement has been duly authorized by Guardian.
This Agreement constitutes the legal, valid and binding obligation of Guardian
and is enforceable against Guardian in accordance with its terms. Other than the
consent of Xxxxxx Financial Inc. (which consent shall be obtained prior to
Closing), neither the execution and delivery of this Agreement nor the
consummation of the transaction contemplated hereby will: (i) require any
consent, authorization, approval or other action of any person, entity or
government authority; (ii) violate or constitute a default under the Articles of
Incorporation of Guardian, or any note, indenture, mortgage, deed of trust or
other contract to which Guardian or its assets are subject; (iii) result in any
adverse effect under any agreement, commitment, license, or permit relating to
or affecting Guardian's assets or business; or (iv) result in the creation or
imposition of any lien, mortgage, pledge, security interest or any other
encumbrance upon Guardian's assets or cause the acceleration of any indebtedness
of Guardian.
3. Representations and Warranties of Westar.
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Westar represents, covenants and warrants to Guardian as follows:
3.1. Corporate Existence/Standing/Authority. Westar is a corporation
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its organization and has all necessary corporate power and
authority to own, operate and lease its properties and, to carry on its business
as now being conducted, and to enter into this Agreement and to carry the
transactions contemplated hereby. Westar is duly qualified to do business and is
in good standing in each jurisdiction where the failure to qualify would have a
material adverse effect on it.
3.2. Title to Series C Preferred Stock. Westar owns the Series C
Preferred Stock free and clear of all liens, encumbrances, or rights of any
other person, corporation, or other entity.
3.3. Authorization; Binding Effect; No Conflict. The execution,
delivery and performance of this Agreement has been duly authorized by Westar.
This Agreement constitutes the legal, valid and binding obligation of Westar and
is enforceable against Westar in accordance with its terms. Neither the
execution and delivery of this Agreement nor the consummation of the transaction
contemplated hereby will: (i) require any consent, authorization, approval or
other action of any person, entity or government authority; (ii) violate or
constitute a default under the Articles of Incorporation of Westar, or any note,
indenture, mortgage, deed of trust or other contract to which Westar or its
assets are subject; (iii) result in any adverse effect under any agreement,
commitment, license, or permit relating to or affecting Westar's assets or
business; or (iv) result in the creation or imposition of any lien, mortgage,
pledge, security interest or any other encumbrance upon Westar's assets or cause
the acceleration of any indebtedness of Westar.
4. Documents to be Delivered at Closing:
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(a). By Guardian
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(i) A stock certificate in definitive form registered in the
name of Westar for 8,000 shares of Guardian Series E Preferred Stock;
(ii) A certified copy of the certificate of incorporation of
Guardian, as amended, to reflect the terms of the Series E Preferred Stock;
(iii) The consent of Xxxxxx Financial, Inc. to the transaction
contemplated by this Agreement;
(iv) A certificate executed by a duly authorized officer of
Guardian certifying that: (A) the representations and warranties in Section 2
hereof are true and correct in all material respects as of the Closing, (B) true
and complete copies of the resolutions duly and validly adopted by the board of
directors of Guardian evidencing their authorization of the execution and
delivery of this Agreement and the consummation of the transaction contemplated
hereby have been provided to Westar, and (C) the person signing this Agreement
on behalf of Guardian is authorized to signed this Agreement and the other
documents to be delivered hereunder on behalf of Guardian; and
(v) Such other documents as Westar may reasonably request.
(b). By Westar
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(i) Certificate representing 8,000 shares of Guardian Series
C Preferred Stock, duly endorsed for transfer to Guardian;
(ii) A certificate executed by a duly authorized officer of
Westar certifying that: (A) the representations and warranties in Section 3
hereof are true and correct in all material respects as of the Closing, (B) true
and complete copies of the resolutions duly and validly adopted by the board of
directors of Westar evidencing their authorization of the execution and delivery
of this Agreement and the consummation of the transaction contemplated hereby
have been provided to Guardian, and (C) the person signing this Agreement on
behalf of Westar is authorized to signed this Agreement and the other documents
to be delivered hereunder on behalf of Westar; and
(iii) Such other documents as Guardian may reasonably request.
5. Miscellaneous.
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5.1. Notices. All notices, requests and other communications hereunder
must be in writing and will be deemed to have been duly given only if delivered
personally, by facsimile transmission, by reputable overnight delivery service,
or mailed (first class postage prepaid) to the parties at the following
addresses or facsimile numbers:
If to Westar: Westar Investments, Inc.
000 X. Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
Phone: 000-000-0000
Fax: 000-000-0000
To Guardian:
Guardian International, Inc.
0000 Xxxxx 00xx Xxxxxxx
Xxxxxxxxx, Xxxxxxx 00000-0000
Attention: President
Phone: 000-000-0000
Fax: 000-000-0000
With a copy (which shall not constitute notice) to:
Xxxxxx Xxxxxxx, Esq.
Steel Xxxxxx & Xxxxx LLP
000 Xxxxx Xxxxxxxx Xxxxxxxxx
00xx Xxxxx
Xxxxx, XX 00000-0000
Phone: 000-000-0000
Fax: 000-000-0000
All such notices, requests and other communications will (a) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (b) if delivered by facsimile transmission, by reputable overnight
delivery service, or by facsimile as provided in this Section, be deemed given
upon receipt, and (c) if delivered by mail in the manner described above to the
addresses provided in this Section, be deemed given upon receipt (in each case
regardless of whether such notice, request or other communication is received by
any other person to whom a copy of such notice is to be delivered pursuant to
this Section). Any party from time to time may change its or her address,
facsimile or other information for the purposes of notices to that party by
giving notice specifying such change to the other parties hereto.
5.2. Entire Agreement and Modification. This Agreement supersedes all
prior agreements between the parties with respect to its subject matter and
constitutes (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the agreement between the parties with
respect to its subject matter. This Agreement may be not amended except by a
written agreement executed by the party to be charged with the Amendment.
5.3 Waiver. Any term or condition of this Agreement may be waived at
any time by the party that is entitled to the benefit thereof, but no such
waiver shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party waiving such term or condition. No waiver by any
party of any term or condition of this Agreement, in any one or more instances,
shall be deemed to be construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion. All remedies will be
cumulative and not alternative.
5.4 Amendment. This Agreement may be amended, supplemented or modified
only by a written instrument duly executed by or on behalf of each party hereto.
5.5 Headings; Counterparts. The headings used in this Agreement have
been inserted for convenience of reference only and do not define or limit the
provisions hereof. This Agreement may be executed in any number of counterparts,
each of which will be deemed an original, but all of which together will
constitute one in the same instrument.
5.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of Florida applicable to a contract executed and
performed in such jurisdiction without giving effect to the conflict of laws
principles thereof.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the duly authorized representative of each party hereto as of the date first
above written.
WESTAR INVESTMENTS, INC.
By: /s/ XXXX X. XXXXX
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__________________, its _______________
GUARDIAN INTERNATIONAL, INC.
By: /s/ XXXXXX X. XXXXX
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Xxxxxx X. Xxxxx, its Director, Vice President and
Chief Financial Officer
EXHIBIT A
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
GUARDIAN INTERNATIONAL, INC.
I.
The name of the corporation is Guardian International, Inc. (the
"Corporation").
II.
Article III of the Articles of Incorporation of the Corporation is
hereby amended to include Section 8 as follows:
1. Section 8. Series E Cumulative Preferred Stock. 16,397 shares of
Preferred Stock shall be designated as Series E 7% Cumulative Preferred Stock,
par value $.001 per share ("Series E Preferred Stock"), and shall have the
following rights and preferences:
(a) Designation and Rank.
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All shares of Series E Preferred Stock shall rank equally and
be identical in all respects. So long as the Series E Preferred Stock is
outstanding, unless consented to by the affirmative vote of 2/3 of the holders
of the outstanding Series E Preferred Stock, the Corporation shall not authorize
or issue additional equity securities of any kind, including shares of Preferred
Stock of any class, series or designation ranking in priority or in parity as to
rights and preferences (including in respect of dividends or rights upon
liquidation, dissolution or winding-up of the Corporation) with the Series E
Preferred Stock now or hereafter authorized including, without limitation,
additional shares of Series E Preferred Stock.
(b) Dividends.
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The holders of the Series E Preferred Stock, in preference to
the holders of Class A Voting Common Stock, par value $.001 per share (the
"Class A Common Stock"), of the Corporation and the Class B Non-Voting Common
Stock, par value $.001 per share (collectively, with the Class A Common Stock,
the "Common Stock"), of the Corporation and any other class or classes of stock
of the Corporation ranking junior in rights and preferences to the Series E
Preferred Stock as to payment of dividends and other distributions shall be
entitled to receive, but only out of any funds legally available for the
declaration of dividends, cumulative, preferential dividends at the annual rate
of 7.00% of the Liquidation Value (as hereinafter defined), in parity with the
holders of Preferred Stock ranking in parity with the Series E Preferred Stock,
payable as follows:
(i) Series E Preferred Stock dividends (the "Dividends") shall
commence to accrue on the shares of Series E Preferred Stock and be cumulative
from and after the date of issuance of such shares of Series E Preferred Stock
(the "Issuance Date") and shall be deemed to accumulate and accrue from day to
day thereafter. Dividends for any partial period shall be computed on the basis
of a 360-day year of twelve 30-day months and the actual number of days elapsed
in the period for which payable.
(ii) The Dividends shall be payable to the holders of the
Series E Preferred Stock quarterly on the 1st day of January, April, July and
October commencing July 1, 2001. The Corporation shall pay Dividends in cash;
provided, however, that if the provisions of the current credit agreement to
which the Corporation is a party, or any replacements thereof, prohibit the
Corporation from paying Dividends in cash, the Dividends shall be paid in shares
("Dividend Common Shares") of Class A Common Stock; provided further that in no
event shall the Corporation pay cash dividends with respect to any stock of the
Corporation ranking junior in rights or preferences to the Series E Preferred
Stock during any period in which cash dividends may not be paid or have not been
paid with respect to the Series E Preferred Stock. Once issued, any Dividend
Common Shares shall rank pari passu and have all of the rights and privileges
associated with all other shares of the Class A Common Stock. If Dividends are
paid in Dividend Common Shares, the price per share of the Class A Common Stock
for determining the number of Dividend Common Shares to be issued shall be equal
to the average of the daily bid and asked prices as of closing of the Class A
Common Stock averaged over the twenty (20) trading days prior to and including
the last day of the quarter immediately preceding the date on which Dividends
are payable. The Corporation shall at all times keep reserved such number of
shares of its authorized and unissued Class A Common Stock as necessary to pay
all Dividends remaining to be paid with respect to the Series E Preferred Stock
in shares of Class A Common Stock as contemplated by this Section 8(b)(ii).
(iii) So long as any share of Series E Preferred Stock remains
outstanding, the Corporation shall not declare, pay or set aside for payment any
dividend on any stock ranking junior in rights or preferences to the Series E
Preferred Stock or make any payment or set apart any fund for payment with
respect to the purchase, redemption or other retirement of any stock ranking
junior in rights or preferences to the Series E Preferred Stock unless all
accrued and unpaid dividends with respect to the Series E Preferred Stock have
been paid in full.
(c) Redemption.
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(i) Optional Redemption. The Corporation may redeem the
Series E Preferred Stock, in whole or in part, at any time and from time to
time, upon not less than 30 days' written notice, after the Issuance Date for an
amount in cash equal to the sum of (1) the Liquidation Value for each such share
of Series E Preferred Stock to be redeemed plus (2) any accrued and unpaid
Dividends thereon plus (3) a premium equal to the product of (i) the Liquidation
Value, (ii) 7.00% and (iii) a fraction, the numerator of which is of the number
of days remaining until (and excluding) October 21, 2004 and the denominator of
which is 2,160 (the "Optional Redemption Price Calculation").
(ii) Redemption Upon a Happening of Certain Event. A holder
of Series E Preferred Stock may elect to cause the Company to redeem its shares
of Series E Preferred Stock for an amount in cash equal to the Redemption Price
upon the occurrence of an event triggering a redemption right pursuant to
Section 7(c)(ii) of Article III herein. Any and all rights provided for in this
Section shall terminate upon the transfer of the Series E Preferred Stock by a
holder of such stock as of April 27, 2001 to any person who is not an
affiliate of Western Resources, Inc., a Kansas corporation, or of such holder.
(iii) Procedures for Redemption.
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(I) In the event that the Corporation redeems shares of
Series E Preferred Stock pursuant to Section 8(c)(i) above, at least fifteen
(15) days and not more than sixty (60) days prior to the date fixed for any
redemption of the Series E Preferred Stock, written notice (the "Redemption
Notice") shall be given by first class mail, postage prepaid, to each holder of
record on the record date fixed for such redemption of the Series E Preferred
Stock at such holder's address as it appears on the stock books of the
Corporation; provided, however, that no failure to give such notice nor any
deficiency therein shall affect the validity of the procedure for the redemption
of any shares of Series E Preferred Stock to be redeemed except as to the holder
or holders to whom the Corporation has failed to give said notice or except as
to the holder or holders whose notice was defective. The Redemption Notice shall
state:
(1) the Redemption Price;
(2) whether all or less than all the outstanding
shares of the Series E Preferred Stock are to be redeemed and the total number
of shares of the Series E Preferred Stock being redeemed;
(3) the date fixed for redemption (the "Redemption
Date");
(4) that the holder is to surrender to the
Corporation, in the manner, at the place or places and at the price designated,
his certificate or certificates representing the shares of Series E Preferred
Stock to be redeemed; and
(5) that dividends on the shares of the Series E
Preferred Stock to be redeemed shall cease to accumulate on such Redemption Date
unless the Corporation defaults in the payment of the Redemption Price.
(II) (1) In the event that a holder of Series E
Preferred Stock (the "Redeeming Series E Holder") elects to redeem its shares of
Series E Preferred Stock pursuant to Section 8(c)(ii) above, at least fifteen
(15) days and not more than sixty (60) days prior to the date of any such
redemption of the Series E Preferred Stock, written notice (the "Holder's
Redemption Notice") shall be given by first class mail, postage prepaid, to the
Corporation. The Redemption Notice shall state:
(A) whether all or less than all the
outstanding shares of the Series E Preferred Stock are to be redeemed and the
total number of shares of the Series E Preferred Stock being redeemed; and
(B) the date of the redemption (the
"Redemption Date").
(2) The Corporation shall, within 10 days of
receipt of the Holder's Redemption Notice, send a notice to the Redeeming Series
E Holder (the "Corporation's Redemption Notice"), stating:
(A) the Redemption Price; and
(B) that the Redeeming Series E Holder is to
surrender to the Corporation, in the manner, at the place or places and at the
price designated, his certificate or certificates representing the shares of
Series E Preferred Stock to be redeemed; and
(C) that Dividends on the shares of Series E
Preferred Stock to be redeemed shall cease to accumulate on the Redemption Date
unless the Corporation defaults in the payment of the Redemption Price.
(III) Each holder of Series E Preferred Stock redeemed
pursuant to the provisions of Section 8(c)(i) or (ii) hereof shall surrender the
certificate or certificates representing such shares of Series E Preferred Stock
to the Corporation, duly endorsed (or otherwise in proper form for transfer, as
determined by the Corporation), in the manner and at the place designated in the
Corporation's Redemption Notice, and on the Redemption Date the full Redemption
Price for such shares shall be payable in cash to the person whose name appears
on such certificate or certificates as the owner thereof, and each surrendered
certificate shall be canceled and retired. In the event that less than all of
the shares represented by any such certificate are redeemed, a new certificate
shall be issued representing the unredeemed shares.
(IV) On and after the Redemption Date, unless the
Corporation defaults in the payment in full of the Redemption Price, Dividends
on the Series E Preferred Stock called for redemption shall cease to accumulate
on the Redemption Date, and all rights of the holders of redeemed shares shall
terminate with respect thereto on the Redemption Date, other than the right to
receive the Redemption Price, without interest; provided, however, that if
notices of redemption shall have been given as provided in Section 8(c)(iii)(I)
and (II) above and the funds necessary for redemption (including an amount in
respect of all dividends that will accrue to the Redemption Date) shall have
been irrevocably deposited in trust for the equal and ratable benefit for the
holders of the shares to be redeemed, then, at the close of business on the day
on which such funds are segregated and set aside, the holders of the shares to
be redeemed shall cease to be stockholders of the Corporation, shall have no
interest in or claims against the Corporation by virtue thereof and shall have
no rights with respect thereto, except the right to receive the Redemption
Price, without interest, upon surrender (and endorsement, if required by the
Corporation) of their certificates, and the shares evidenced thereby shall no
longer be outstanding.
(d) Voting Rights. The holders of Series E Preferred Stock shall not be
entitled to vote or consent on any matters required or permitted to be submitted
to the stockholders of the Corporation for their approval, except to the extent
that voting rights are specifically provided by Florida law or Section 8(a) or
8(e) hereof.
(e) Special Voting Rights.
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(i) Amendment to Articles of Incorporation. The Corporation shall
not amend its Articles of Incorporation so as to adversely affect in any manner
the specified rights, preferences, privileges or voting rights of the Series E
Preferred Stock or to authorize additional shares of Series E Preferred Stock
unless consented to by the affirmative vote of 2/3 of the holders of the
outstanding Series E Preferred Stock.
(ii) Election of Directors.
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(I) Subject to the provisions of Section 8(e)(ii)(II)
below, upon the occurrence of a Default Event (hereafter defined) with respect
to the Series E Preferred Stock and for the duration of the Default Period
(hereafter defined), the holders of the Series E Preferred Stock, in addition to
any other voting rights they may have by law, shall be entitled to vote (voting
separately as a series by a majority of the outstanding shares thereof) for the
election to the Board of Directors of the smallest number of additional
directors necessary to constitute at any given time a majority of the total
number of members of the Board of Directors (after giving effect to such
election), and should such percentage when applied to the number of the members
of the Board of Directors result in a number that includes a fraction, then such
number shall be increased to the next whole number. In addition, during the
Default Period, the holders of the Series E Preferred Stock shall be entitled to
designate (voting as a series as aforesaid) the number of positions on the Board
of Directors, which shall be the smallest number of directors necessary for the
nominees of the holders of the Series E Preferred Stock to constitute a majority
of the full Board. In case the holders of the Series E Preferred Stock become
entitled to exercise such special voting rights, they may call a special meeting
of stockholders during the Default Period, in the manner provided in the bylaws
or otherwise as provided by law, for the purpose of increasing or decreasing the
number of positions on the Board of Directors and electing such members to the
Board of Directors. In addition, the holders of the Series E Preferred Stock
shall have such special voting rights at any annual or regular meeting of
stockholders (or any other special meeting not called by the holders of the
Series E Preferred Stock) held during the Default Period. In lieu of the
foregoing, the holders of the Series E Preferred Stock may take any of such
actions by a written consent signed by the holders of at least a majority of the
shares the Series E Preferred Stock outstanding and entitled to vote thereon.
(II) Notwithstanding the provisions of Section 8(d)(ii)(I)
above, if during the Default Period, a Default Event occurs and is continuing
with respect to the Series D Preferred Stock, the holders of the Series D
Preferred Stock, in addition to any other voting rights they may have by law,
shall be entitled to vote (together, as a class, with the Series E Preferred
Stock) for the election of additional directors to the Board of Directors, as
described in Section 8(e)(ii)(I) above.
(III) Removal; Vacancies. During the Default Period, each
director elected by the holders of the Series E Preferred Stock may be removed
only by the vote of the holders of the majority of the outstanding shares of
such series of Preferred Stock, voting separately as a series, at a meeting of
the stockholders, or of the holders of the Series E Preferred Stock, called for
that purpose. During the Default Period, any vacancy in the office of a director
elected by the holders of the Series E Preferred Stock may be filled by a vote
of the remaining directors then in office elected by the holders of such series
of Preferred Stock, or, if not so filled, by the holders of such series of
Preferred Stock at any meeting, annual or special, for the election of directors
held thereafter. A special meeting of stockholders, or of the holders of shares
of Series E Preferred Stock, may be called for the purpose of filling any such
vacancy. In the case of removal of any such director, the vacancy may be filled
at the same meeting at which such removal shall be voted. Holders of the Series
E Preferred Stock shall be entitled to notice of each meeting of stockholders at
which they shall have any right to vote or notice of which is otherwise required
by law. In lieu of the foregoing, the holders of the Series E Preferred Stock
may take any of such actions by a written consent signed by the holders of at
least a majority of the shares of such series of Preferred Stock outstanding and
entitled to vote thereon.
(IV) Expiration of Right. Upon termination of the Default
Period, the special voting rights of the holders of the Series E Preferred Stock
in default provided hereunder shall be immediately divested, but always subject
to the revesting of such right in the holders of the Series E Preferred Stock
upon the occurrence of any subsequent Default Event. In the event that such
rights of the holders of the Series E Preferred Stock shall cease as provided
above, then the directors elected to the Board of Directors by the holders of
the Series E Preferred Stock under Section I shall be automatically removed from
office, and their respective positions terminated and the number of positions on
the Board of Directors reduced in accordance with such termination, without
further action on the part of the holders of Preferred Stock, the holders of
Common Stock or the Board of Directors.
(V) Default Event. For purposes hereof, a "Default Event"
occurs on the date that (A)(i) the Corporation has failed to pay a Dividend when
due and (ii) such Dividend remains unpaid for 30 days or (B) the Corporation
fails to discharge any redemption obligation with respect to the Series E
Preferred Stock.
(VI) Default Period. For purposes hereof, "Default Period"
means a period commencing on the date a Default Event occurs and ending (i) with
respect to a Dividend default upon the payment of the next quarterly Dividend in
full and any cumulative Dividends in arrears in full and (ii) with respect to a
redemption default, upon the discharge in full by the Corporation of its
obligations with respect to such redemption.
(f) Liquidation.
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(i) The Series E Preferred Stock shall rank pari passu upon
liquidation with the Series C Preferred Stock and Series D Preferred Stock and
shall be preferred upon liquidation over the Common Stock and any other class or
classes of stock of the Corporation which does not expressly rank senior in
rights and preferences to the Series E Preferred Stock or on a parity with the
Series E Preferred Stock upon liquidation. Holders of shares of Series E
Preferred Stock shall be entitled to be paid, after full payment is made on any
stock ranking prior to the Series E Preferred Stock as to rights and preferences
(but before any distribution is made to the holders of the Common Stock and any
junior stock), pro rata based on the Liquidation Value pari passu with the
holders of shares of the Series C Preferred Stock and Series D Preferred Stock
upon the voluntary or involuntary dissolution, liquidation or winding up of the
Corporation (a "Liquidation").
(ii) The amount payable on each share of Series E Preferred
Stock in the event of Liquidation shall be the Liquidation Value plus any
accrued and unpaid Dividends.
(iii) Upon Liquidation, if the net assets of the Corporation
are insufficient to permit the payment in full of the amounts to which the
holders of all outstanding shares of Series E Preferred Stock are entitled as
provided above, the entire net assets of the Corporation remaining (after full
payment is made on any stock ranking prior to the Series E Preferred Stock as to
rights and preferences) shall be distributed among the holders of Series E
Preferred Stock and the holders of shares of Preferred Stock ranking in parity
with the Series E Preferred Stock as to rights and preferences to which they are
respectively entitled in amounts proportionate to the full preferential amounts.
(iv) For purposes of this Section 8(f), the voluntary sale,
lease, exchange or transfer, for cash, shares of stock, securities or other
consideration, of all or substantially all the Corporation's property or assets
to, or its consolidation or merger with, one or more corporations shall not be
deemed to be a Liquidation.
(g) Notices to Holders of Series E Preferred Stock.
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In the event:
(i) of any consolidation or merger to which the Corporation is
a party and for which approval of any stockholders of the Corporation is
required, or of the conveyance or transfer of the properties and assets of the
Corporation substantially as an entirety, or of any capital reorganization or
reclassification or change of the Common Stock (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 subdivision or combination);
(ii) of Liquidation;
(iii) of the occurrence of an event triggering a redemption right
pursuant to Section 7(c)(ii) of Article III herein;
then the Corporation shall cause to be given to each of the
registered holders of the Series E Preferred Stock at its address appearing on
the Register for the Series E Preferred Stock, at least 20 calendar days prior
to the applicable record date hereinafter specified, by registered mail, postage
prepaid, return receipt requested, a written notice stating the date on which
any such consolidation, merger, conveyance, transfer or Liquidation or an event
triggering a redemption right pursuant to Section 7(c)(ii) of Article III herein
is expected to become effective, and the date as of which it is expected that
holders of record of Common Stock shall be entitled to exchange their shares for
securities or other property, if any, deliverable upon such reclassification,
consolidation, merger, conveyance, transfer or Liquidation.
This Amendment to the Articles of Incorporation was duly adopted
pursuant to Section 607.1002 of the Florida Business Corporation Act by the
unanimous resolution of the Board of Directors on April 11, 2001 and was
ratified by the sole holder of the Series C Preferred Stock and Series D
Preferred Stock on April 25, 2001.
IN WITNESS WHEREOF, the Corporation has caused these Articles of
Amendment to be executed on April 27, 2001.
GUARDIAN INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: Director, Vice President and
Chief Finance Officer
