EXHIBIT 4.1


 


DESCRIPTION OF THE REGISTRANT’S SECURITIES
REGISTERED 


PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE
ACT OF 1934


 





As of December 31, 2020,
P&F Industries, Inc. (the “Corporation”) had one class of securities registered under Section 12 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), which is our Class A Common Stock.


 


Description of Class A Common Stock


 


The following description
of our Class A Common Stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference
to our Restated Certificate of Incorporation (the “Certificate of Incorporation”) and our Bylaws (as amended on September
19, 2016) (the “Bylaws”). The Certificate of Incorporation and Bylaws are incorporated by reference as an exhibit to the Annual
Report on Form 10-K of which this Exhibit 4.1 is a part. We encourage you to read our Certificate of Incorporation, our Bylaws and the
applicable provisions of the Delaware General Corporation Law (“DGL”), for additional information.


 


Authorized Capital Shares


 





Pursuant to our Certificate
of Incorporation our Board of Directors is authorized to issue 7,000,000 shares of Class A Common Stock, $1 par value per share (“Class
A Common Stock”) in addition to 2,000,000 shares of Class B Common Stock, $1 par value per share, and 2,000,000 shares of preferred
stock, par value $10 per share. As of March 19, 2021, there were 3,181,286 shares of our Class A Common Stock outstanding and no other
shares outstanding. The outstanding shares of our Class A Common Stock are fully paid and nonassessable.


 


Voting Rights


 


Except as otherwise provided
by law or by this Certificate of Incorporation, and subject to the rights of holders of outstanding shares of preferred stock that may
be issued in the future, the holders of Class A Common Stock shall have the sole right to vote at meetings of stockholders and shall be
entitled to one vote per share; however, in case there shall be presented for approval any proposal to: (a) effect a merger or consolidation
of the Corporation; (b) dissolve the Corporation; or (c) sell, lease or exchange all or substantially all of the property and assets of
the Corporation, then the holders of Class B Common Stock, if any, shall also have the right to vote on such proposal, voting together
with the holders of Class A Common Stock as a single class. Our Class A Common Stock does not have cumulative voting rights. Elections
of directors are determined by a plurality of the votes cast, and for all other matters, the affirmative vote of a majority of the shares
of stock present or represented at the meeting shall be the act of the stockholders. Our Board of Directors is classified, consisting
of three classes of directors serving staggered three-year terms.


 


Dividend Rights


 


Subject to the rights of
holders of outstanding shares of preferred stock that may be issued in the future, the holders of Class A Common Stock are entitled to
receive dividends, if any, as may be declared from time to time by the Board of Directors in its discretion out of funds legally available
for the payment of dividends. To the extent there are any shares of Class B Common Stock outstanding, the holders of Class B Common Stock
and the holders of Class A Common Stock shall be entitled to share equally, share for share, in such dividends.


 


Liquidation Rights


 


Subject to any preferential
rights of outstanding shares of preferred stock that may be issued in the future, holders of Class A Common Stock (together with holders
of Class B Common Stock, if any) will share ratably in all assets legally available for distribution to our stockholders in the event
of dissolution.


 






    


     


    

 


DESCRIPTION OF THE REGISTRANT’S SECURITIES
REGISTERED 


PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE
ACT OF 1934


 


Other Rights and Preferences


 


Our Class A Common Stock
has no sinking fund or redemption provisions or preemptive, conversion or exchange rights.


 


Listing


 


The Class A Common Stock is
traded on The Nasdaq Stock Market LLC under the trading symbol “PFIN.”


 


Change of Control Provisions


 


Provisions of our Certificate
of Incorporation and Bylaws may delay or discourage transactions involving an actual or potential change in control of the Corporation
or change in the Corporation’s management, including transactions that stockholders might otherwise deem to be in their best interests.
In addition to provisions of the DGL, as well as the provisions described above, the Certificate of Incorporation and Bylaws include the
following provisions:


 


		(a)	vacancies on our Board of Directors, and any new director positions created by the expansion of our Board
of Directors, may be filled only by a majority of the directors then in office, subject to certain exceptions;



 


		(b)	our Bylaws establish an advance notice procedure for stockholders to submit proposed nominations of persons
for election to our Board of Directors and other proposals for business to be brought before an annual meeting of our Stockholders;



 


		(c)	our Board of Directors may issue shares of preferred stock, with designations, rights and preferences
as may be determined from time to time by our Board of Directors;



 


		(d)	our Bylaws may only be amended by our Board of Directors; and



 


		(e)	our Bylaws provide that special meetings of the stockholders may be called only by the chairperson of
our board, our President or our Board of Directors.