eng_ex42





 







EXHIBIT 4.2


 



Description of Registrant’s Securities Registered under
Section 12 of the Securities Exchange Act of 1934

 


The
following description sets forth certain material terms and
provisions of the common stock of ENGlobal Corporation, which is
registered under Section 12 of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”). This description also
summarizes relevant provisions of the Nevada Revised Statutes
(“NRS”). The following description is a summary and
does not purport to be complete. It is subject to, and qualified in
its entirety by reference to, the relevant provisions of the NRS,
and to our Restated Articles of Incorporation dated January 29,
2021 (collectively, the “Articles of Incorporation”)
and our Second Amended and Restated Bylaws dated April 14, 2016
(the “Bylaws”), which are filed as Exhibit 3.1 and
Exhibit 3.2, respectively, to the Annual Report on Form 10-K of
which this Exhibit 4.2 is a part, and are incorporated by reference
herein. We encourage you to read the Articles of Incorporation and
the Bylaws, and the relevant provisions of the NRS for additional
information. Unless the context requires otherwise, all references
to “we,” “us,” “our” and the
“Company” in this Exhibit 4.2 refer solely to ENGlobal
Corporation and not to its subsidiaries.

 



Authorized and Outstanding Capital Stock

 


The
Company is authorized to issue 75,000,000 shares of common stock,
par value $0.001 per share (“Common Stock”), and
2,000,000 shares of undesignated preferred stock, par value $0.001
per share (“Preferred Stock”). As of March 11, 2021, there were 27,553,186
shares of Common Stock and no
shares of Preferred Stock issued and outstanding.

 



Common Stock

 


Voting. Holders of shares of
the Common Stock are entitled to one vote for each share held of
record on matters properly submitted to a vote of our stockholders.
Stockholders are not entitled to vote cumulatively for the election
of directors.

 


Dividends. Subject to the
dividend rights of the holders of any outstanding series of
Preferred Stock, holders of shares of Common Stock will be entitled
to receive ratably such dividends, if any, when, as, and if
declared by our Board of Directors out of the Company’s
assets or funds legally available for such dividends or
distributions.

 


Liquidation and Distribution.
In the event of any liquidation, dissolution, or winding up of the
Company’s affairs, holders of the Common Stock would be
entitled to share ratably in the Company’s assets that are
legally available for distribution to its stockholders. If the
Company has any Preferred Stock outstanding at such time, holders
of the Preferred Stock may be entitled to distribution preferences,
liquidation preferences, or both. In such case, the Company must
pay the applicable distributions to the holders of its Preferred
Stock before it may pay distributions to the holders of Common
Stock.

 


Conversion, Redemption, and Preemptive
Rights. Holders of the Common Stock have no preemptive,
subscription, redemption or conversion rights.

 


Sinking Fund Provisions. There
are no sinking fund provisions applicable to the Common
Stock.

 



 







 





 



Anti-Takeover Effects of Nevada Law and the Articles of
Incorporation and Bylaws

 


General. Certain provisions of
the Articles of Incorporation and Bylaws, and certain provisions of
the NRS could make our acquisition by a third party, a change in
our incumbent management, or a similar change of control more
difficult. These provisions, which are summarized below, are likely
to reduce our vulnerability to an unsolicited proposal for the
restructuring or sale of all or substantially all of our assets or
an unsolicited takeover attempt. The summary of the provisions set
forth below does not purport to be complete and is qualified in its
entirety by reference to the Articles of Incorporation and the
Bylaws and the relevant provisions of the NRS.

 


Authorized but Unissued Shares.
Our authorized but unissued shares of common stock and preferred
stock are available for future issuance, subject to any limitations
imposed by the listing standards of The Nasdaq Capital Market.
These additional shares may be used for a variety of corporate
finance transactions, acquisitions and employee benefit plans. The
existence of authorized but unissued and unreserved common stock
and preferred stock could make it more difficult or discourage an
attempt to obtain control of us by means of a proxy contest, tender
offer, merger or otherwise..

 


No Action by Written Consent.
Our Bylaws provide that no action required or permitted to be taken
at a meeting of the stockholders may be taken by written
consent.

 


Advance Notice Requirements.
Stockholders wishing to nominate persons for election to our Board
of Directors at a meeting or to propose any business to be
considered by our stockholders at a meeting must comply with
certain advance notice and other requirements set forth in our
Bylaws.

 


Special Meetings. Our Bylaws
provide that special meetings of stockholders may only be called by
the President or Secretary, by a majority of the Board of
Directors, or by the President at the written request of at least
fifty percent (50%) of the number of shares of the Company then
outstanding and entitled to vote.

 


Board Vacancies. Our Bylaws
provide that any vacancy on our Board of Directors, howsoever
resulting, may be filled by a majority vote of the remaining
directors.

 


Removal of Directors. Our
Bylaws provide that any directors may be removed either with or
without cause at any time by the vote of stockholders representing
two-thirds of the voting power of the issued and outstanding
capital stock entitled to vote.

 


Nevada Anti-Takeover Statutes.
The NRS contains provisions restricting the ability of a Nevada
corporation to engage in business combinations with an interested
stockholder. Under the NRS, except under certain circumstances,
business combinations with interested stockholders are not
permitted for a period of two years following the date such
stockholder becomes an interested stockholder. The NRS defines an
interested stockholder, generally, as a person who is the
beneficial owner, directly or indirectly, of 10% of the outstanding
shares of a Nevada corporation. In addition, the NRS generally
disallows the exercise of voting rights with respect to
“control shares” of an “issuing
corporation” held by an “acquiring person,”
unless such voting rights are conferred by a majority vote of the
disinterested stockholders. “Control shares” are those
outstanding voting shares of an issuing corporation which an
acquiring person and those persons acting in association with an
acquiring person (i) acquire or offer to acquire in an acquisition
of a controlling interest and (ii) acquire within ninety days
immediately preceding the date when the acquiring person became an
acquiring person. An “issuing corporation” is a
corporation organized in Nevada which has two hundred or more
stockholders, at least one hundred of whom are stockholders of
record and residents of Nevada, and which does business in Nevada
directly or through an affiliated corporation. The NRS also permits
directors to resist a change or potential change in control of the
corporation if the directors determine that the change or potential
change is opposed to or not in the best interest of the
corporation.

 



Stock Exchange Listing

 


The
Common Stock is traded on the NASDAQ Capital Market under the
symbol “ENG.”

 



Transfer Agent and Registrar

 


The
transfer agent and registrar for the Common Stock is Computershare
Investor Services, LLC located at P.O. Box 30170, College Station,
TX 77842-3170 and its telephone number is
1-800-662-7232.