Exhibit 4.1


 


DESCRIPTION
OF SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES


EXHANGE ACT OF 1934


 


As
of February 26, 2021, Akers Biosciences, Inc., a New Jersey corporation (“we,” “our” and the “Company”)
has our common stock, no par value per share registered under Section 12 of the Securities Exchange Act of 1934, as amended.


 


The
description of our capital stock included herein is intended as a summary and is qualified in its entirety by reference to our
amended and restated certificate of incorporation (the “Amended and Restated Certificate of Incorporation”) and the
amended and restated by-laws, as amended (the “By-laws”) as currently in effect, copies of which are filed as exhibits
to this Annual Report on Form 10-K and are incorporated herein by reference.


 


Authorized
Capital Stock


 


Our authorized capital
stock consists of 150,000,000 shares, of which 100,000,00 are common stock, without par value, and 50,000,000 are preferred stock,
without par value, 10,000,000 of which have been designated as Series A Convertible Preferred Stock, 1,990,000 of which have been
designated as Series C Convertible Preferred Stock (the “Series C Preferred Stock”), 211,353 of which have been designated
as Series D Convertible Preferred Stock (the “Series D Preferred Stock”), and 100,000 of which have been designated
as Series E Junior Participating Preferred Stock. As of February 26, 2021, there were 16,652,829 shares of common stock
issued and outstanding and no shares of Series A Convertible Preferred Stock, Series C Convertible Preferred Stock or Series E
Junior Participating Preferred Stock issued and outstanding. As of February 26, 2021, there were 72,992 shares of Series
D Preferred Stock issued and outstanding and warrants to purchase Series C Preferred Stock convertible into 55,000 shares of common
stock outstanding.




 


Common
Stock


 


Voting
Rights


 


Each
stockholder has one vote for each share of common stock held on all matters submitted to a vote of stockholders. A stockholder
may vote in person or by proxy. Elections of directors are determined by a plurality of the votes cast and all other matters are
decided by a majority of the votes cast by those stockholders entitled to vote and present in person or by proxy.


 


Because
our stockholders do not have cumulative voting rights, stockholders holding a majority of the voting power of our shares of common
stock will be able to elect all of our directors. Our Amended and Restated Certificate of Incorporation and By-laws provide that
stockholder actions may be affected at a duly called meeting of stockholders or pursuant to written consent of the majority of
stockholders. A special meeting of stockholders may be called by the president, chief executive officer or the board of directors
pursuant to a resolution approved by the majority of the board of directors.


 


Dividend
Rights


 


The
holders of outstanding shares of common stock are entitled to receive dividends out of funds legally available at the times and
in the amounts that our board of directors may determine, provided that required dividends, if any, on preferred stock have been
paid or provided for. However, to date we have not paid or declared cash distributions or dividends on our common stock and do
not currently intend to pay cash dividends on our common stock in the foreseeable future. We intend to retain all earnings, if
and when generated, to finance our operations. The declaration of cash dividends in the future will be determined by the board
of directors based upon our earnings, financial condition, capital requirements and other relevant factors.


 


No
Preemptive or Similar Rights


 


Holders
of our common stock do not have preemptive rights, and common stock is not convertible or redeemable.


 




    	 	 	 



    	 



    

 


Right
to Receive Liquidation Distributions


 


Upon
our dissolution, liquidation or winding-up, the assets legally available for distribution to our stockholders and remaining after
payment to holders of preferred stock of the amounts, if any, to which they are entitled, are distributable ratably among the
holders of our common stock subject to any senior class of securities.


 


The
NASDAQ Capital Market Listing


 


Our
common stock is listed on The Nasdaq Capital Market under the symbol “AKER”.


 


Transfer
Agent and Registrar


 


The
transfer agent and registrar for Akers common stock is Action Stock Transfer Corporation, 2469 E. Fort Union Blvd., Suite 214,
Salt Lake City, UT 84121.


 


Registration Rights


 


Pursuant to the Securities Purchase Agreement,
dated as of November 11, 2020, by and among Akers and certain institutional and accredited investors, following the filing of
a proxy statement with the Securities Exchange Commission in connection with the Company’s proposed business combination
with MyMD Pharmaceuticals, Inc. pursuant to that certain Agreement and Plan of Merger dated November 11, 2020, the Company is
required to file a registration statement under the Securities Act of 1933, as amended, for the resale by such purchasers of all
of the shares of Akers common stock and the shares of Akers common stock underlying the warrants issued in the private placement,
and use commercially reasonable efforts to cause such registration statement to be declared effective within 60 days of the filing
thereof, subject to certain exceptions.




 


Options,
Warrants and RSUs


 


As
of February 26, 2021, we had no shares of common stock issuable upon exercise of outstanding options, 10,925,952 shares
of common stock issuable upon the exercise of warrants, and 1,972,972 shares of common stock issuable upon the exercise of pre-funded
warrants, 55,000 shares of common stock issuable upon the exercise of warrants to purchase Series C Preferred Stock and an aggregate
of 804,963 shares of common stock issuable upon settlement of vested restricted stock units (“RSUs”) and upon vesting
and settlement of outstanding unvested RSUs. The shares issuable upon the vesting of RSUs are not issuable until the increase
in the number authorized shares of common stock is approved by the stockholders of the Company. There are no other outstanding
warrants, options or RSUs at this time.


 


Preferred
Stock


 


We
may issue any class of preferred stock in any series. Our board of directors has the authority, subject to limitations prescribed
under New Jersey law, to issue preferred stock in one or more series, to establish from time to time the number of shares to be
included in each series and to fix the designation, powers, preferences and rights of the shares of each series and any of its
qualifications, limitations and restrictions. Our board of directors can also increase or decrease the number of shares of any
series, but not below the number of shares of that series then outstanding. Our board of directors may authorize the issuance
of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders
of the common stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and
other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in control
of the Company and may adversely affect the market price of common stock and the voting and other rights of the holders of common
stock.


 


Series
C Convertible Preferred Stock


 


As
of February 26, 2021, Akers had 55,000 warrants to purchase an aggregate of 55,000 shares of Series C Preferred Stock outstanding,
with an exercise price of $4.00 per share of Series C Preferred Stock (the “Series C Warrants”). The Series C Warrants
were issued on December 9, 2019 and expire on January 6, 2025.


 


Rank


 


The
Series C Preferred Stock ranks (1) on parity with common stock on an “as converted” basis, (2) senior to any series
of our capital stock hereafter created specifically ranking by its terms junior to the Series C Preferred Stock, (3) on parity
with any series of our capital stock hereafter created specifically ranking by its terms on parity with the Series C Preferred
Stock, and (4) junior to any series of our capital stock hereafter created specifically ranking by its terms senior to the Series
C Preferred Stock in each case, as to dividends or distributions of assets upon our liquidation, dissolution or winding up whether
voluntary or involuntary.





 




    	 	 	 



    	 



    

 


Conversion
Rights


 


Each
share of the Series C Preferred Stock is convertible into one (1) share of common stock, provided that the holder will be prohibited
from converting Series C Preferred Stock into shares of common stock if, as a result of such conversion, the holder would own
more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of the shares
of common stock issuable upon conversion of the Series C Preferred Stock, or, at the election of a holder, together with its affiliates,
would own more than 9.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance
of the shares of common stock issuable upon conversion of the Series C Preferred Stock. The conversion rate of the Series C Preferred
Stock is subject to proportionate adjustments for stock splits, reverse stock splits and similar events, but is not subject to
adjustment based on price anti-dilution provisions.


 


Dividend
Rights


 


In
addition to stock dividends or distributions for which proportionate adjustments will be made, holders of Series C Preferred Stock
are entitled to receive dividends on shares of Series C Preferred Stock equal, on an as-if-converted-to-common-stock basis, to
and in the same form as dividends actually paid on shares of the common stock when, as and if such dividends are paid on shares
of the common stock. No other dividends are payable on shares of Series C Preferred Stock.


 


Voting
Rights


 


Except
as provided in the Certificate of Designation of Series C Convertible Preferred Stock (the “Series C Certificate of Designation”)
or as otherwise required by law, the holders of Series C Preferred Stock will have no voting rights. However, we may not, without
the consent of holders of a majority of the outstanding shares of Series C Preferred Stock, alter or change adversely the powers,
preferences or rights given to the Series C Preferred Stock, increase the number of authorized shares of Series C Preferred Stock,
or enter into any agreement with respect to the foregoing.


 


Liquidation
Rights


 


Upon
any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the holders of Series C Preferred
Stock are entitled to receive, pari passu with the holders of common stock, out of the assets available for distribution
to stockholders an amount equal to such amount per share as would have been payable had all shares of Series C Preferred Stock
been converted into common stock immediately before such liquidation, dissolution or winding up, without giving effect to any
limitation on conversion as a result of the beneficial ownership limitation, as described above.


 


Exchange
Listing


 


Akers
does not plan on making an application to list the shares of Series C Preferred Stock on the Nasdaq, any national securities exchange
or other nationally recognized trading system. Our common stock issuable upon conversion of the Series C Preferred Stock is listed
on the Nasdaq under the symbol “AKER”.


 


Failure
to Deliver Conversion Shares


 


If
we fail to timely deliver shares of common stock upon conversion of the Series C Preferred Stock

(the “Series C Conversion Shares”) within the time period specified in the Series C Certificate of Designation (within
two trading days after delivery of the notice of conversion, or any shorter standard settlement period in effect with respect
to trading market on the date notice is delivered), then we are obligated to pay to the holder, as liquidated damages, an amount
equal to $50 per trading day (increasing to $100 per trading day after the third trading day and $200 per trading day after the
tenth trading day) for each $5,000 of Series C Conversion Shares for which the Series C Preferred Stock being converted are not
timely delivered. If we make such liquidated damages payments, we are not also obligated to make Series C Buy-In (as defined below)
payments with respect to the same Series C Conversion Shares.


 




    	 	 	 



    	 



    

 


Compensation
for Series C Buy-In on Failure to Timely Deliver Shares


 


If
we fail to timely deliver the Series C Conversion Shares to the holder, and if after the required delivery date the holder is
required by its broker to purchase (in an open market transaction or otherwise) or the holder or its brokerage firm otherwise
purchases, shares of common stock to deliver in satisfaction of a sale by the holder of the Series C Conversion Shares which the
holder anticipated receiving upon such conversion or exercise (a “Series C Buy-In”), then we are obligated to (A)
pay in cash to the holder the amount, if any, by which (x) the holder’s total purchase price (including brokerage commissions,
if any) for the shares of common stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Series C
Conversion Shares that we were required to deliver times (2) the price at which the sell order giving rise to such purchase obligation
was executed, and (B) at the option of the holder, either reinstate the portion of the Series C Preferred Stock and equivalent
number of Series C Conversion Shares for which such conversion was not honored (in which case such conversion shall be deemed
rescinded) or deliver to the holder the number of shares of common stock that would have been issued had we timely complied with
our conversion and delivery obligations.


 


Subsequent
Rights Offerings; Pro Rata Distributions


 


If
we grant, issue or sell any common stock equivalents pro rata to the record holders of any class of shares of common stock (the
“Series C Purchase Rights”), then a holder of Series C Preferred Stock will be entitled to acquire, upon the terms
applicable to such Series C Purchase Rights, the aggregate Series C Purchase Rights which the holder could have acquired if the
holder had held the number of shares of common stock acquirable upon conversion of the Series C Preferred Stock (without regard
to any limitations on conversion). If we declare or make any dividend or other distribution of our assets (or rights to acquire
our assets) to holders of common stock, then a holder of Series C Preferred Stock is entitled to participate in such distribution
to the same extent as if the holder had held the number of shares of common stock acquirable upon complete conversion of the Series
C Preferred Stock (without regard to any limitations on conversion).


 


Fundamental
Transaction


 


If,
at any time while the Series C Preferred Stock is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another person) is completed pursuant to which holders of common stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding common
stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the common stock or any compulsory share exchange pursuant to which the common stock is effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another person whereby such other person acquires more than 50% of the
outstanding shares of common stock (not including any shares of common stock held by the other person or other persons making
or party to, or associated or affiliated with the other persons making or party to, such stock or share purchase agreement or
other business combination) (each a “Series C Preferred Stock Fundamental Transaction”), then upon any subsequent
conversion of Series C Preferred Stock, the holder will receive, for each Series C Conversion Share that would have been issuable
upon such conversion immediately prior to the occurrence of such Series C Preferred Stock Fundamental Transaction (without regard
to the beneficial ownership limitation), the number of shares of common stock of the successor or acquiring corporation or of
the Company, if it is the surviving corporation, and any additional consideration (the “Series C Preferred Stock Alternate
Consideration”) receivable as a result of such Series C Preferred Stock Fundamental Transaction by a holder of the number
of shares of common stock for which the Series C Preferred Stock is convertible immediately prior to such Series C Preferred Stock
Fundamental Transaction (without regard to the beneficial ownership limitation). For purposes of any such conversion, the determination
of the conversion ratio will be appropriately adjusted to apply to such Series C Preferred Stock Alternate Consideration based
on the amount of Series C Preferred Stock Alternate Consideration issuable in respect of one share of common stock in such Series
C Preferred Stock Fundamental Transaction. If holders of common stock are given any choice as to the securities, cash or property
to be received in a Series C Preferred Stock Fundamental Transaction, then the holder will be given the same choice as to the
Series C Preferred Stock Alternate Consideration it receives upon automatic conversion of the Series C Preferred Stock following
such Series C Preferred Stock Fundamental Transaction.


 




    	 	 	 



    	 



    

 


Series
D Convertible Preferred Stock


 


Rank


 


The
Series D Preferred Stock ranks (1) on parity with common stock on an “as converted” basis, (2) senior to any series
of our capital stock hereafter created specifically ranking by its terms junior to the Series D Preferred Stock, (3) on parity
with any series of our capital stock hereafter created specifically ranking by its terms on parity with the Series D Preferred
Stock, and (4) junior to any series of our capital stock hereafter created specifically ranking by its terms senior to the Series
D Preferred Stock in each case, as to dividends or distributions of assets upon our liquidation, dissolution or winding up whether
voluntary or involuntary.


 


Conversion
Rights


 


A
holder of Series D Preferred Stock is entitled at any time to convert any whole or partial number of shares of Series D Preferred
Stock into shares of our common stock, determined by dividing the stated value equal to $0.01 by the conversion price of $0.01
per share. A holder of Series D Preferred Stock is prohibited from converting Series D Preferred Stock into shares of common stock
if, as a result of such conversion, the holder, together with its affiliates, would own more than 4.99% of the total number of
shares of our common stock then issued and outstanding (with such ownership restriction referred to as the “Series D Beneficial
Ownership Limitation”) immediately after giving effect to the issuance of the shares of common stock issuable upon conversion
of the Series D Preferred Stock. However, any holder may increase or decrease such percentage to any other percentage not in excess
of 9.99%, provided that any increase in such percentage shall not be effective until 61 days after such notice to us. The conversion
rate of the Series D Preferred Stock is subject to proportionate adjustments for stock splits, reverse stock splits and similar
events, but is not subject to adjustment based on price anti-dilution provisions.


 


Dividend
Rights


 


In
addition to stock dividends or distributions for which proportionate adjustments will be made, holders of Series D Preferred Stock
are entitled to receive dividends on shares of Series D Preferred Stock equal, on an as-if-converted-to-common-stock basis, to
and in the same form as dividends actually paid on shares of the common stock when, as and if such dividends are paid on shares
of the common stock. No other dividends are payable on shares of Series D Preferred Stock.


 


Voting
Rights


 


Subject
to the Series D Beneficial Ownership Limitation, on any matter presented to our stockholders for their action or consideration
at any meeting of our stockholders (or by written consent of stockholders in lieu of a meeting), each holder, in its capacity
as such, shall be entitled to cast the number of votes equal to the number of whole shares of our common stock into which the
Series D Preferred Stock beneficially owned by such holder are convertible as of the record date for determining stockholders
entitled to vote on or consent to such matter (taking into account all Series D Preferred Stock beneficially owned by such holder).
Except as otherwise required by law or by the other provisions of the Certificate of Designation of Series D Convertible Preferred
Stock (the “Series D Certificate of Designation”), the holders of Series D Preferred Stock, in their capacity as such,
shall vote together with the holders of our common stock and any other class or series of stock entitled to vote thereon as a
single class.


 




    	 	 	 



    	 



    

 


Liquidation
Rights


 


Upon
any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, the holders of Series D Preferred
Stock are entitled to receive, pari passu with the holders of common stock, out of the assets available for distribution
to stockholders an amount equal to such amount per share as would have been payable had all shares of Series D Preferred Stock
been converted into common stock immediately before such liquidation, dissolution or winding up, without giving effect to any
limitation on conversion as a result of the Series D Beneficial Ownership Limitation, as described above.


 


Exchange
Listing


 


Series
D Preferred Stock is not listed on the Nasdaq, any national securities exchange or other nationally recognized trading system.
Our common stock issuable upon conversion of the Series D Preferred Stock is listed on the Nasdaq under the symbol “AKER”.


 


Failure
to Deliver Conversion Shares


 


If
we fail to timely deliver shares of common stock upon conversion of the Series D Preferred Stock

(the “Series D Conversion Shares”) within the time period specified in the Series D Certificate of Designation (within
two trading days after delivery of the notice of conversion, or any shorter standard settlement period in effect with respect
to trading market on the date notice is delivered), then we are obligated to pay to the holder, as liquidated damages, an amount
equal to $25 per trading day (increasing to $50 per trading day on the third trading day and $100 per trading day on the sixth
trading day) for each $5,000 of stated value of Series D Preferred Stock being converted which are not timely delivered. If we
make such liquidated damages payments, we are not also obligated to make Series D Buy-In (as defined below) payments with respect
to the same Series D Conversion Shares.


 


Compensation
for Series D Buy-In on Failure to Timely Deliver Shares


 


If
we fail to timely deliver the Series D Conversion Shares to the holder, and if after the required delivery date the holder is
required by its broker to purchase (in an open market transaction or otherwise) or the holder or its brokerage firm otherwise
purchases, shares of common stock to deliver in satisfaction of a sale by the holder of the Series D Conversion Shares which the
holder anticipated receiving upon such conversion or exercise (a “Series D Buy-In”), then we are obligated to (A)
pay in cash to such holder (in addition to any other remedies available to or elected by such holder) the amount, if any, by which
(x) such holder’s total purchase price (including any brokerage commissions) for the shares of common stock so purchased
exceeds (y) the product of (1) the aggregate number of Series D Conversion Shares that such holder was entitled to receive from
the conversion at issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation
was executed (including any brokerage commissions) and (B) at the option of such holder, either reissue (if surrendered) the shares
of Series D Preferred Stock equal to the number of shares of Series D Preferred Stock submitted for conversion (in which case,
such conversion shall be deemed rescinded) or deliver to such holder the number of Series D Conversion Shares that would have
been issued if we had timely complied with its delivery requirements.


 


Series
E Junior Participating Preferred Stock


 


In
September 2020, our board of directors declared a dividend of one preferred share purchase right

(a “Right”) for each of our issued and outstanding shares of common stock, payable to the stockholders of record on
September 21, 2020. Each such Right entitles the registered holder, subject to the terms of a Rights Agreement, dated as of September
9, 2020, between the Company and VStock Transfer, LLC (the “Rights Agreement”), to purchase from the Company one one-thousandth
of a share of the Company’s Series E Junior Participating Preferred Stock, no par value with a stated value of $0.001 (the
“Series E Preferred Stock”), at $15.00, subject to certain adjustments. Pursuant to the Agreement and Plan of Merger,
dated November 11, 2020, by and among the Company, XYZ Merger Sub Inc., a wholly owned subsidiary of the Company, and MyMD Pharmaceuticals,
Inc. (“MYMD”), we agreed to take any and all necessary action to terminate such shareholder rights plan prior to closing
of the merger.


 




    	 	 	 



    	 



    

 


The
Rights will not be exercisable until the earlier to occur of (i) the tenth business day following a public announcement or filing
that a person has, or affiliates or associates of such person have, become an “Acquiring Person,” which is defined
as a person, or affiliates or associates of such person, who, at any time after the date of the Rights Agreement, has acquired,
or obtained the right to acquire, Beneficial Ownership of 10% or more of our outstanding shares of common stock, subject to certain
exceptions, or (ii) the tenth business day (or such later date as may be determined by action of our board of directors prior
to such time as any person or group of affiliated or associated persons becomes an Acquiring Person) after the commencement of,
or announcement of an intention to commence, a tender offer or exchange offer the consummation of which would result in any person
becoming an Acquiring Person (the earlier of such dates being called the “Distribution Date”). Beneficial Ownership,
as defined in the Rights Agreement, includes certain interests in securities created by derivatives contracts, which are beneficially
owned, directly or indirectly, by a counterparty (or any of such counterparty’s affiliates or associates) under any derivatives
contract to which such person or any of such person’s affiliates or associates is a receiving party (as such terms are defined
in Rights Agreement), subject to certain limitations.


 


Until
the Distribution Date, (i) the Rights will be evidenced by the common stock certificates (or, for uncertificated shares of common
stock, by the book-entry account that evidences record ownership of such shares) and will be transferred with, and only with,
such Common Stock, and (ii) new common stock certificates issued after September 21, 2020 will contain a legend incorporating
the Rights Agreement by reference (for book entry common stock, this legend will be contained in the notations in book entry accounts).
Until the earlier of the Distribution Date and the Expiration Date (defined below), the transfer of any shares of common stock
outstanding on September 21, 2020 will also constitute the transfer of the Rights associated with such shares of common stock.
As soon as practicable after the Distribution Date, VStock Transfer, LLC (the “Rights Agent”) will send by first-class,
insured, postage prepaid mail, to each record holder of the common stock as of the close of business on the Distribution Date
separate rights certificates evidencing the Rights (“Right Certificates”), and such Right Certificates alone will
evidence the Rights. We may choose book entry in lieu of physical certificates, in which case, references to “Rights Certificates”
shall be deemed to mean the uncertificated book entry representing the Rights.


 


The
Rights, which are not exercisable until the Distribution Date, expire upon the earliest to occur of (i) the close of business
on September 8, 2021; (ii) the time at which the Rights are redeemed or exchanged pursuant to the Rights Agreement; and (iii)
the time at which the Rights are terminated upon the closing of any merger or other acquisition transaction involving the Company
pursuant to a merger or other acquisition agreement that has been approved by our board of directors prior to any person becoming
an Acquiring Person (the earliest of (i), (ii), and (iii) is referred to as the “Expiration Date”).


 


Each
share of Series E Preferred Stock will be entitled to a preferential per share dividend rate equal to the greater of (i) $0.001
and (ii) the sum of (1) 1,000 times the aggregate per share amount of all cash dividends, plus (2) 1,000 times the aggregate per
share amount (payable in kind) of all non-cash dividends or other distributions other than certain dividends or subdivisions of
the outstanding shares of common stock. Each shares of Series E Preferred Stock will entitle the holder thereof to a number of
votes equal to 1,000 on all matters submitted to a vote of our stockholders. In the event of any merger, consolidation or other
transaction in which shares of common stock are exchanged, each share of Series E Preferred Stock will be entitled to receive
1,000 times the amount received per one share of common stock. Pursuant to the Rights Agreement, the preferential rates noted
above may be adjusted in the event that we (i) pay dividends in common stock, (ii) subdivide the outstanding common stock or (iii)
combine outstanding common stock into a smaller number of shares.


 


The
purchase price payable, and the number of shares of Series E Preferred Stock or other securities or property issuable, upon exercise
of the Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend, or a subdivision,
combination or reclassification of the Series E Preferred Stock, (ii) if the holders of the Series E Preferred Stock are granted
certain rights, options or warrants to subscribe for the applicable Series E Preferred Stock or securities convertible into the
applicable Series E Preferred Stock at less than the current market price of the applicable Series E Preferred Stock, or (iii)
upon the distribution to holders of Series E Preferred Stock of evidences of indebtedness, cash (excluding regular quarterly cash
dividends), assets (other than dividends payable in Series E Preferred Stock) or subscription rights or warrants (other than those
referred to in (ii) immediately above). The number of outstanding Rights and the number of one one-thousandths of a shares of
Series E Preferred Stock issuable upon exercise of each Right are also subject to adjustment in the event of a stock split, reverse
stock split, stock dividends and other similar transactions.


 


With
some exceptions, no adjustment in the purchase price relating to a Right will be required until cumulative adjustments amount
to at least one percent (1%) of the purchase price relating to the Right. No fractional shares of Series E Preferred Stock are
required to be issued (other than fractions which are integral multiples of one one-thousandth of a share of Series E Preferred
Stock) and, in lieu of the issuance of fractional shares, we may make an adjustment in cash based on the market price of the Series
E Preferred Stock on the trading date immediately prior to the date of exercise.


 




    	 	 	 



    	 



    

 


In
the event that a person or group of affiliated or associated persons becomes an Acquiring Person, each holder of a Right will
thereafter have the right to receive, upon exercise, common stock (or, in certain circumstances, other securities, cash or other
assets of the Company) having a value equal to two (2) times the exercise price of the Right. Notwithstanding any of the foregoing,
following the occurrence of a person becoming an Acquiring Person, all Rights that are, or (under certain circumstances specified
in the Rights Agreement) were, beneficially owned by any Acquiring Person (or by certain related parties) will be null and void
and any holder of such Rights (including any purported transferee or subsequent holder) will be unable to exercise or transfer
any such Rights. However, Rights are not exercisable following the occurrence of a person becoming an Acquiring Person until the
Distribution Date.


 


In
the event that, after a person or a group of affiliated or associated persons has become an Acquiring Person, the Company is acquired
in a merger or other business combination transaction, or 50% or more of the Company’s assets or earning power are sold,
proper provision will be made so that each holder of a Right will thereafter have the right to receive, upon the exercise of a
Right that number of shares of common stock of the person with whom the Company has engaged in the foregoing transaction (or its
parent) that at the time of such transaction have a market value of two (2) times the exercise price of the Right.


 


At
any time before any person or group of affiliated or associated persons becomes an Acquiring Person, our board of directors may
redeem the Rights in whole, but not in part, at a price of $0.001 per Right (subject to certain adjustments) (the “Redemption
Price”). The redemption of the Rights may be made effective at such time, on such basis and with such conditions as our
board of directors in its sole discretion may establish. Immediately upon the action of the board of directors electing to redeem
or exchange the Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.


 


Our
board of directors may, at its option, at any time after the first occurrence of a Flip-in Event (as defined in the Rights Agreement),
exchange all or part of the then outstanding and exercisable Rights for shares of common stock at an exchange ratio of one share
of common stock per Right, appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring
after the effective date. However, the board of directors shall not effect such an exchange at any time after any person, together
with all affiliates and associates of such person, becomes a beneficial owner of 50% or more of the outstanding shares of common
stock. Immediately upon the action of our board of directors to exchange the Rights, the Rights will terminate and the only right
of the holders of Rights will be to receive the number of shares of common stock equal to the number of Rights held by such holder
multiplied by the exchange ratio.


 


Until
a Right is exercised or exchanged, the holder thereof, as such, will have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.


 


Our
board of directors may amend or supplement the Rights Agreement without the approval of any holders of Rights at any time so long
as the Rights are redeemable. At any time the Rights are no longer redeemable, no such supplement or amendment may (i) adversely
affect the interests of the holders of Rights (other than an Acquiring Person or an affiliate or associate of an Acquiring Person),
(ii) cause the Rights Agreement to become amendable other than in accordance with Section 27 of the Rights Agreement, or (iii)
cause the Rights again to become redeemable.


 


Anti-Takeover
Provisions


 


The
authorization of undesignated preferred stock makes it possible for our board of directors to issue preferred stock with voting
or other rights or preferences that could impede the success of any attempt to change our control.


 


These
provisions are intended to enhance the likelihood of continued stability in the composition of our board of directors and its
policies and to discourage certain types of transactions that may involve an actual or threatened acquisition of the Company.


 




    	 	 	 



    	 



    







 


These
provisions are also designed to reduce our vulnerability to an unsolicited acquisition proposal and to discourage certain tactics
that may be used in proxy fights. However, such provisions could have the effect of discouraging others from making tender offers
for our shares and may have the effect of deterring hostile takeovers or delaying changes in our control or management. As a consequence,
these provisions also may inhibit fluctuations in the market price of our stock that could result from actual or rumored takeover
attempts.


 


In
addition, we are subject to Section 14A-10A of the New Jersey Shareholders Protection Act, a type of anti-takeover statute designed
to protect stockholders against coercive, unfair or inadequate tender offers and other abusive tactics and to encourage any person
contemplating a business combination with the Company to negotiate with our board of directors for the fair and equitable treatment
of all stockholders. Subject to certain qualifications and exceptions, the statute prohibits an “interested stockholder”
of a combined company from effecting a business combination with the combined company for a period of five years unless its board
of directors approved the combination or transaction or series of related transactions that caused such person to become an interested
stockholder prior to the stockholder becoming an interested stockholder or after the stockholder becomes an interested stockholder
if the subsequent business combination is approved by (i) the combined company’s board of directors (or a committee thereof
consisting solely of persons independent from the interested stockholder), and (ii) the affirmative vote of a majority of the
voting stock not beneficially owned by such interested stockholder. In addition, but not in limitation of the five-year restriction,
the combined company may not engage at any time in a business combination with any interested stockholder of the combined company
unless the combination is approved by its board of directors (or a committee thereof consisting solely of persons independent
from such interested stockholder) prior to the consummation of the business combination, and the combination receives the approval
of a majority of the voting stock of the combined company not beneficially owned by the interested stockholder if the transaction
or series of related transactions which caused the interested stockholder to become an interested stockholder was approved by
the board of directors prior to the stockholder becoming an interested stockholder.


 


An
“interested shareholder” is defined to include any beneficial owner of 10% or more of the voting power of the outstanding
voting stock of the corporation and any affiliate or associate of the corporation who within the prior five-year period has at
any time owned 10% or more of the voting power of the then outstanding stock of the corporation.


 


The
term “business combination” is defined to include a broad range of transactions including, among other things:


 


	 	●	the
    merger or consolidation of the corporation, or any of its subsidiaries, with the interested shareholder or any other corporation
    that is, or after the merger or consolidation, would be an affiliate or associate of the interested shareholder,
	 	 	 
	 	●	the
    sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions) to
    an interested shareholder or any affiliate or associate of the interested shareholder of (i) 10% or more of the aggregate
    market value of corporation’s assets, (ii) 10% or more of the aggregate market value of all the corporation’s
    outstanding stock, or (iii) representing 10% or more of the earning power or income of the corporation, determined on a consolidated
    basis; or
	 	 	 
	 	●	the
    issuance or transfer by the corporation, or any of its subsidiaries, (in one transaction or a series of transactions) to an
    interested shareholder or any affiliate or associate of the interested shareholder of 5% or more of the aggregate market value
    of the stock of the corporation, or any of its subsidiaries, except pursuant to an exercise of warrants or rights to purchase
    stock offered, or a dividend or distribution paid or made, pro rata to all stockholders of the corporation.


 


The
effect of the statute is to protect non-tendering, post-acquisition minority stockholders from mergers in which they will be “squeezed
out” after the merger, by prohibiting transactions in which an acquirer could favor itself at the expense of minority stockholders.
The statute generally applies to corporations that are organized under New Jersey law.