minm_ex41



















EXHIBIT 4.1



 



MINIM, INC.



DESCRIPTION OF SECURITIES


 


The
following description of the common stock and preferred stock of
Minim, Inc. (“us,” “our,” “we”
or the “Company”) summarizes the material terms and
provisions of the common stock and the preferred stock. For the
complete terms of our common stock and preferred stock, please
refer to our amended and restated certificate of incorporation, as
amended, which we refer to as our charter, and our bylaws, as
amended, which we refer to as our bylaws, that are incorporated
herein by reference. The summary below is qualified in its entirety
by reference to our charter and bylaws. The terms of these
securities may also be affected by the General Corporation Law of
the State of Delaware.


 



General


 


We are
authorized under Delaware law to issue up to 60,000,000 shares of
common stock, $.01 par value per share, and 2,000,000 shares of
preferred stock, $.001 par value per share.


 



Common Stock


 


Voting Rights.  Each holder
of common stock is entitled to one vote for each share of common
stock held on all matters submitted to a vote of the stockholders,
including the election of directors. Except as otherwise provided
by law or our charter or bylaws, all matters other than the
election of directors submitted to the stockholders at any meeting
shall be decided by the affirmative vote of a majority of votes
properly cast upon such question. Directors are elected by a
plurality of the votes cast at the meeting. Our charter and bylaws
do not provide for cumulative voting rights. Because of this, the
holders of a majority of the shares of common stock entitled to
vote in any election of directors can elect all of the directors
standing for election, if they should so choose.



 


Dividends.  Subject to
preferences that may be applicable to any then outstanding
preferred stock, the holders of our outstanding shares of common
stock are entitled to receive dividends, if any, as may be declared
from time to time by our board of directors out of legally
available funds. We have never
declared or paid cash dividends on our capital stock and do not
plan to pay any cash dividends in the foreseeable future. We
currently anticipate that we will retain all available funds for
use in the operation and expansion of our business. In addition, pursuant to the Silicon Valley Bank
Loan and Security Agreement, we cannot pay any dividends without
Silicon Valley Bank’s prior written
consent.



 


Liquidation.  In the event of
our liquidation, dissolution or winding up, holders of common stock
will be entitled to share ratably in the net assets legally
available for distribution to stockholders after the payment of all
of our debts and other liabilities, subject to the satisfaction of
any liquidation preference granted to the holders of any
outstanding shares of preferred stock.



 


Other Rights and
Preferences.  Holders of our common stock have no
preemptive, conversion or subscription rights, and there are no
redemption or sinking fund provisions applicable to our common
stock. The rights, preferences and privileges of the holders of
common stock are subject to, and may be adversely affected by, the
rights of the holders of shares of any series of our preferred
stock that we may designate and issue in the future.



 


Fully Paid and
Nonassessable.  All of our outstanding shares of
common stock are fully paid and nonassessable.


 


Provisions in our
charter provide that our board of directors is authorized to issue
preferred stock in one or more series, to establish the number of
shares to be included in each such series, to establish the voting
powers (if any) of the shares to be included in such series, and to
fix the powers, designations, preferences and relative,
participating, optional or other special rights of the shares of
each such series and to fix the qualifications, limitations or
restrictions thereof, including without limitation thereof,
dividend rights, special voting rights, conversion rights,
redemption privileges and liquidation preferences. The issuance of
preferred stock may have the effect of delaying, deferring or
preventing a change in control of our company without further
action by the stockholders and may adversely affect the voting and
other rights of the holders of common stock. The issuance of
preferred stock with voting and conversion rights may adversely
affect the voting power of the holders of common stock, including
the loss of voting control to others.


 



Certain Governance Arrangements


 


As
of October 9, 2020, the Company entered into a Standstill and
Voting Agreement (the “Standstill Agreement”) with Zulu
Holdings LLC (“Zulu”) and Jeremy Hitchcock. Pursuant to
the terms of the Standstill Agreement, each of Zulu, Mr. Hitchcock
and their controlled affiliates (the “Restricted
Parties”) have agreed not to effect any (a) transaction
involving the Company and any Restricted Party, in which any
Restricted Party would have a material interest different from
stockholders of the Company generally, (b) purchase of more than
10% of the then total number of shares of outstanding Common Stock,
and (c) sale, transfer or other disposition of Common Stock to a
third party that would result in such third party beneficially
owning more than 20.0% of the Company’s outstanding common
stock immediately after giving effect to such transaction. The
duration of the “Standstill Period” lasts through the
earlier of: (i) such time as the Restricted Parties beneficially
own less than 45.0% of the outstanding Common Stock of the Company,
and (ii) the third anniversary of the date of the Standstill
Agreement.


 



Anti-Takeover Effects of Delaware Law and Our Charter and
Bylaws


 


Some
provisions of Delaware law, our charter and our bylaws contain
provisions that could make the following transactions more
difficult: an acquisition of us by means of a tender offer; an
acquisition of us by means of a proxy contest or otherwise; or the
removal of our incumbent officers and directors. It is possible
that these provisions could make it more difficult to accomplish or
could deter transactions that stockholders may otherwise consider
to be in their best interest or in our best interests, including
transactions which provide for payment of a premium over the market
price for our shares.


 


These
provisions, summarized below, are intended to discourage coercive
takeover practices and inadequate takeover bids. These provisions
are also designed to encourage persons seeking to acquire control
of us to first negotiate with our board of directors. We believe
that the benefits of the increased protection of our potential
ability to negotiate with the proponent of an unfriendly or
unsolicited proposal to acquire or restructure us outweigh the
disadvantages of discouraging these proposals because negotiation
of these proposals could result in an improvement of their
terms.



 



 







 






 


Undesignated Preferred Stock. The
ability of our board of directors, without action by the
stockholders, to issue up to 2,000,000 shares of undesignated
preferred stock with voting or other rights or preferences as
designated by our board of directors could impede the success of
any attempt to change control of us. These and other provisions may
have the effect of deferring hostile takeovers or delaying changes
in control or management of our company.



 


Stockholder Meetings. Our bylaws
provide that a special meeting of stockholders may be called only
by our president or by our board of directors.



 


Requirements for Advance Notification of
Stockholder Nominations and Proposals. Our bylaws
establish advance notice procedures with respect to the nomination
of candidates for election as directors, other than nominations
made by or at the direction of the board of directors.



 


Elimination of Stockholder Action by Written
Consent. Our bylaws eliminate the right of stockholders
to act by written consent without a meeting.



  


Removal of Directors. Our bylaws
provide that members of our board of directors may only be removed
from office (i) with or without cause at any annual or special
meeting of stockholders by a vote of a majority of the stockholders
entitled to vote in the election of directors, or (ii) for cause by
a vote of a majority of the directors then in office, provided that
a director may be removed for cause only after reasonable notice
and opportunity to be heard before the body proposing to remove
such director.



 


Stockholders Not Entitled to Cumulative
Voting. Our amended and restated charter does not
permit stockholders to cumulate their votes in the election of
directors. Accordingly, the holders of a majority of the
outstanding shares of our common stock entitled to vote in any
election of directors can elect all of the directors standing for
election, if they choose.



 


Delaware Anti-Takeover Statute. We
are subject to Section 203 of the Delaware General Corporation Law,
which prohibits persons deemed to be “interested
stockholders” from engaging in a “business
combination” with a publicly held Delaware corporation for
three years following the date these persons become interested
stockholders unless the business combination is, or the transaction
in which the person became an interested stockholder was, approved
in a prescribed manner or another prescribed exception applies.
Generally, an “interested stockholder” is a person who,
together with affiliates and associates, owns, or within three
years prior to the determination of interested stockholder status
did own, 15% or more of a corporation’s voting stock.
Generally, a “business combination” includes a merger,
asset or stock sale, or other transaction resulting in a financial
benefit to the interested stockholder. The existence of this
provision may have an anti-takeover effect with respect to
transactions not approved in advance by the board of
directors.


 


The
provisions of Delaware law, our charter and our bylaws could have
the effect of discouraging others from attempting hostile takeovers
and, as a consequence, they may also inhibit temporary fluctuations
in the market price of our common stock that often result from
actual or rumored hostile takeover attempts. These provisions may
also have the effect of preventing changes in the composition of
our board and management. It is possible that these provisions
could make it more difficult to accomplish transactions that
stockholders may otherwise deem to be in their best
interests.



 



Transfer and Warrant Agent and Registrar


 


The
transfer and warrant agent and registrar for our common stock and
registered warrants is Computershare.



 



Listing


 


Our
shares of common are quoted on the OTCQB Venture Market under the
symbol “MINM.”