Document:

Exhibit
10.1

 

“FORM OF”

 

SECURITIES
SETTLEMENT AGREEMENT

 

This
SECURITIES SETTLEMENT AGREEMENT (the “Agreement”), dated as of March 25, 2020, is by and among Taronis
Technologies, Inc., a Delaware corporation, with offices located at 300 W. Clarendon Ave. #230, Phoenix, Arizona 85013 (the “Company”)
and First Choice International Company, Inc., a Delaware corporation (“FIRST CHOICE”).

 

RECITALS

 

		A.	FIRST
                                         CHOICE is entitled to certain monies from the Company in the aggregate amount of $1,291,750
                                         (the “Indebtedness”) arising from that certain Promissory Note dated
                                         February 7, 2020 by and between the Company and FIRST CHOICE as amended to date (“Agreement”).

 

		B.	The
                                         Company and FIRST CHOICE desire to enter into this transaction for the Company to issue
                                         at market price to FIRST CHOICE $1,291,750 worth of registered freely tradable shares
                                         (the “Securities”) of the Company’s common stock, $0.001 par
                                         value (“Common Stock”), in satisfaction and payment in full of payment
                                         of the Indebtedness.

 

		C.	Contemporaneously
                                         with the execution of this Agreement, the Company shall file a prospectus supplement
                                         to its existing shelf registration statement on Form S-3, Registration No. 333-230854,
                                         with the United States Securities and Exchange Commission (the “SEC”),
                                         which includes the Securities (the “Registration Statement”).

 

AGREEMENT

 

NOW,
THEREFORE, in consideration of the recitals above incorporated herein by this reference and the mutual covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and FIRST
CHOICE hereby agree as follows:

 

1. ISSUANCE
OF COMMON STOCK IN SATISFACTION OF INDEBTEDNESS.

 

(a) Issuance
of Common Stock. In full satisfaction and in lieu of cash payment of the Indebtedness due to FIRST CHOICE, the Company shall
issue to First Choice on the Closing Date (as defined below) the Securities.

 

(b) Closing.
The sale and purchase of the Securities shall take place at a closing (the “Closing”) to be managed by the
remote exchange of documents. The date and time of the Closing shall be 5:00 p.m., New York time, on the Effective Date, or at
such other time or on such other date as parties hereto may mutually agree in writing (the “Closing Date”).

 

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2. FIRST
CHOICE’S REPRESENTATIONS AND WARRANTIES.

 

FIRST
CHOICE represents and warrants to the Company with respect to only itself that, as of the date hereof and the Closing Date:

 

(a) Validity;
Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of FIRST CHOICE and shall
constitute the legal, valid and binding obligation of FIRST CHOICE enforceable against FIRST CHOICE in accordance with its terms,
except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’
rights and remedies.

 

(b) No
Conflicts. The execution, delivery and performance by FIRST CHOICE of this Agreement and the consummation by FIRST CHOICE
of the transactions contemplated hereby will not (i) result in a violation of the organizational documents of FIRST CHOICE or
(ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument
to which FIRST CHOICE is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws) applicable to FIRST CHOICE, except in the case of clauses (ii) and (iii) above, for such conflicts,
defaults, rights or violations which could not, individually or in the aggregate, reasonably be expected to have a material adverse
effect on the ability of FIRST CHOICE to perform its obligations hereunder.

 

3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.

 

The
Company represents and warrants to FIRST CHOICE that, as of the date hereof and the Closing Date:

 

(a) Authorization;
Enforcement; Validity. The Company has the requisite power and authority to enter into and perform its obligations under this
Agreement and to issue the Securities in accordance with the terms hereof and thereof. The execution and delivery of this Agreement
by the Company, and the consummation by the Company of the transactions contemplated hereby (including, without limitation, the
issuance of the shares of Common Stock) have been duly authorized by the Company’s board of directors and (other than (x)
the filing with the SEC of the prospectus supplement to the Registration Statement, which shall occur on the date hereof and (y)
any other filings as may be required by any state securities agencies (collectively, the “Required Filings”))
no further filing, consent or authorization is required by the Company, its subsidiaries, their respective boards of directors
or their stockholders or other governing body. This Agreement has been duly executed and delivered by the Company, and constitutes
the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies
and except as rights to indemnification and to contribution may be limited by federal or state securities law.

 

    	 	2	 

    	 

    

 

(b) Issuance
of Securities. The issuance of the Securities is duly authorized and the Securities, when issued, shall be validly issued,
fully paid and non-assessable and free from all preemptive or similar rights, mortgages, defects, claims, liens, pledges, charges,
taxes, rights of first refusal, encumbrances, security interests and other encumbrances (collectively “Liens”)
with respect to the issuance thereof.

 

(c) Registration.
As of the Closing, the Securities shall have been registered under the Securities Act of 1933, as amended (the “1933
Act”) and will be issued pursuant to the Registration Statement. As such, the Securities will be freely transferable
and freely tradable by FIRST CHOICE without restriction, whether by way of registration or some exemption therefrom. The Registration
Statement and any prospectus included therein, shall comply in all material respects with the requirements of the 1933 Act, and
the documents incorporated by reference into the Registration Statement, when filed, shall comply in all material respects with
the requirements of the 1934 Act and, in each case, with the rules and regulations of the SEC promulgated under the 1933 Act or
the 1934 Act, as the case may be. At the time the Registration Statement and any amendments thereto become effective the Registration
Statement and any amendments thereto will comply in all material respects with the requirements of the 1933 Act and will not contain
any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein not misleading. The prospectus contained in the Registration Statement and any amendments or supplements
thereto, at the time the prospectus or any amendment or supplement thereto is issued, will comply in all material respects with
the requirements of the 1933 Act and will not contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

(c)No
Conflicts. The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of
the transactions contemplated hereby (including, without limitation, the issuance of the Securities and the registration of the
Securities pursuant to the Registration Statement) will not (i) result in a violation of the Certificate of Incorporation (as
defined below) (including, without limitation, any certificate of designation contained therein), Bylaws (as defined below), certificate
of formation, memorandum of association, articles of association, bylaws or other organizational documents of the Company or any
of its subsidiaries, or any capital stock or other securities of the Company or any of its subsidiaries, (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both would become a default) in any respect under, or
give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to
which the Company or any of its subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment
or decree (including, without limitation, foreign, federal and state securities laws and regulations applicable to the Company
or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries is bound or affected.

 

4. REGISTER;
TRANSFER AGENT INSTRUCTIONS; LEGEND.

 

(a) Register.
The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate
by notice to each holder of Securities), a register for the Securities in which the Company shall record (x) the name and address
of the person in whose name the shares of Common Stock have been issued (including the name and address of each transferee) and
(y) the aggregate number of shares of Common Stock held by such Person. The Company shall keep the register open and available
at all times during business hours for inspection of any FIRST CHOICE or its legal representatives.

 

    	 	3	 

    	 

    

 

(b) Transfer
Agent Instructions. From and after the Effective Date:

 

(i)
the Company shall issue irrevocable instructions to the transfer agent set forth in Section 5(f) below and to any subsequent transfer
agent (as applicable, the “Transfer Agent”) in a form acceptable to FIRST CHOICE (the “Irrevocable
Transfer Agent Instructions”) to issue certificates or credit shares to the applicable balance accounts at DTC, registered
in the name of FIRST CHOICE or its respective nominee(s), for the Securities;

 

(ii)
the Company represents and warrants that no instruction other than the Irrevocable Transfer Agent Instructions referred to in
this Section 5(b) will be given by the Company to its Transfer Agent with respect to the Securities, and that the Securities shall
otherwise be freely transferable on the books and records of the Company, as applicable, to the extent provided in this Agreement;
and

 

(iii)
if FIRST CHOICE effects a sale, assignment or transfer of the Securities, the Company shall permit the transfer and shall promptly
instruct the Transfer Agent to issue one or more certificates or credit shares to the applicable balance accounts at DTC in such
name and in such denominations as specified by FIRST CHOICE to effect such sale, transfer or assignment.

 

(c) Legends.
Certificates and any other instruments evidencing the Securities shall not bear any restrictive or other legend.

 

(d) FAST
Compliance. From and after the Effective Date, while any shares of Common Stock remain outstanding, the Company shall maintain
a transfer agent that participates in the DTC Fast Automated Securities Transfer Program (“FAST”).

 

6. MISCELLANEOUS.

 

(a) Governing
Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this
Agreement shall be governed by the internal laws of the State of Florida, without giving effect to any choice of law or conflict
of law provision or rule (whether of the State of Florida or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of Florida. The Company hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in West Palm Beach, Florida, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby, and hereby irrevocably waives, and agrees not to assert in any suit, action
or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding
is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude FIRST CHOICE
from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s
obligations to FIRST CHOICE or to enforce a judgment or other court ruling in favor of FIRST CHOICE. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
WITH OR ARISING OUT OF THIS AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

    	 	4	 

    	 

    

 

(b) Counterparts.
This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party. In the event that
any signature is delivered by facsimile transmission or by an e-mail which contains a portable document format (.pdf) file of
an executed signature page, such signature page shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.

 

(c) Headings;
Gender. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation
of, this Agreement. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine,
feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include”
and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,”
“hereunder,” “hereof” and words of like import refer to this entire Agreement instead of just the provision
in which they are found.

 

(d) Severability.
If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity
or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will
endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

(e) Entire
Agreement; Amendments. Except as set forth in Section 3(d) hereof, this Agreement supersedes all other prior oral or written
agreements between FIRST CHOICE and the Company contains the entire understanding of the parties solely with respect to the matters
covered herein. For clarification purposes, the Recitals are part of this Agreement and the Engagement Agreement remains in full
force and effect. No provision of this Agreement may be amended or waived other than by an instrument in writing signed by the
Company and FIRST CHOICE.

 

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(f) Notices.
Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement
must be in writing and will be deemed to have been given and delivered: (i) upon receipt, when delivered personally; (ii)
upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party) or electronic mail; or (iii) one (1) Business Day after deposit with an overnight courier
service with next day delivery specified, in each case, properly addressed to the party to receive the same. As used herein
“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks in New
York, New York are authorized or required by law to remain closed. The addresses, facsimile numbers and e-mail addresses for
such communications shall be:

 

If
to the Company:

 

Taronis
Technologies, Inc.

[ADDRESS]

Telephone:

Attention:

E-Mail:

 

If
to the Transfer Agent:

 

EQ

[ADDRESS]

Telephone:

Facsimile:

Attention:

E-Mail:

 

If
to FIRST CHOICE:

 

First
Choice International Company, Inc.

[ADDRESS]

Facsimile:

Telephone:

E-mail:

Attention:

 

or
to such other address, e-mail address and/or facsimile number and/or to the attention of such other Person as the recipient party
has specified by written notice given to each other party five (5) days prior to the effectiveness of such change. Written confirmation
of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically
generated by the sender’s facsimile machine or e-mail containing the time, date, recipient facsimile number and, with respect
to each facsimile transmission, an image of the first page of such transmission or (C) provided by an overnight courier service
shall be rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance
with clause (i), (ii) or (iii) above, respectively.

 

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(g) Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors
and assigns, including any purchasers of any of the Securities. The Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of FIRST CHOICE. FIRST CHOICE may assign some or all of its rights hereunder in connection
with any transfer of any of its Securities without the consent of the Company, in which event such assignee shall be deemed to
be FIRST CHOICE hereunder with respect to such assigned rights.

 

(h) No
Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

 

(i) Survival.
The representations, warranties, agreements and covenants contained herein shall survive the Closing. FIRST CHOICE shall be responsible
only for its own representations, warranties, agreements and covenants hereunder.

 

(j) Further
Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.

 

(k) Construction.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and
no rules of strict construction will be applied against any party. No specific representation or warranty shall limit the generality
or applicability of a more general representation or warranty. Each and every reference to share prices, shares of Common Stock
and any other numbers in this Agreement that relate to the Common Stock shall be automatically adjusted for any stock splits,
stock dividends, stock combinations, recapitalizations or other similar transactions that occur with respect to the Common Stock
after the date of this Agreement through the Closing Date.

 

(l) Remedies.
FIRST CHOICE, and in the event of assignment by FIRST CHOICE of its rights and obligations hereunder, each holder of Securities,
shall have all rights and remedies set forth in this Agreement and all of the rights which such holders have under the law. Any
person having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically (without
posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to exercise
all other rights granted by law. Furthermore, the Company recognizes that in the event that it fails to perform, observe, or discharge
any or all of its obligations under this Agreement, any remedy at law would inadequate relief to FIRST CHOICE. The Company therefore
agrees that FIRST CHOICE shall be entitled to specific performance and/or temporary, preliminary and permanent injunctive or other
equitable relief from any court of competent jurisdiction in any such case without the necessity of proving actual damages and
without posting a bond or other security. The remedies provided in this Agreement shall be cumulative and in addition to all other
remedies available under this Agreement, at law or in equity (including a decree of specific performance and/or other injunctive
relief).

 

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IN
WITNESS WHEREOF, FIRST CHOICE and the Company have caused their respective signature page to this Agreement to be duly executed
as of the date first written above.

 

	 	FIRST CHOICE INTERNATIONAL COMPANY, INC.
	 	 	 
	 	By: 	                       
	 	Name:	 
	 	Title:	 

 

[Signature
Page to Securities Settlement Agreement]

 

    	 	 	 

    	 

    

 

IN
WITNESS WHEREOF, FIRST CHOICE and the Company have caused their respective signature page to this Agreement to be duly executed
as of the date first written above.

 

	 	COMPANY:
	 	 	 
	 	TARONIS
    TECHNOLOGIES, INC.
	 	 	 
	 	By:
    	                        
	 	Name:	 
	 	Title:	 

 

[Signature
Page to Securities Settlement Agreement]vir-ex44_1069.htm

Exhibit 4.4

 

DESCRIPTION OF CAPITAL STOCK

General 

Our amended and restated certificate of incorporation states that our authorized capital stock consists of 300,000,000 shares of common stock, par value $0.0001 per share, and 10,000,000 shares of preferred stock, par value $0.0001 per share. 

Common Stock 

Voting Rights 

Each holder of common stock is entitled to one vote for each share on all matters submitted to a vote of the stockholders. The affirmative vote of holders of at least 66 2/3% of the voting power of all of the then-outstanding shares of capital stock, voting as a single class, will be required to amend certain provisions of our amended and restated certificate of incorporation, including provisions relating to amending our amended and restated bylaws, the classified structure of our board of directors, the size of our board of directors, removal of directors, director liability, vacancies on our board of directors, special meetings, stockholder notices, actions by written consent and exclusive jurisdiction. 

Dividends 

The holders of our common stock are entitled to receive ratably any dividends that our board of directors may declare out of funds legally available for that purpose on a non-cumulative basis. 

Liquidation 

In the event of our liquidation, dissolution or winding up, holders of our 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. 

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. 

Preferred Stock 

Under the amended and restated certificate of incorporation, our board of directors has the authority, without further action by the stockholders, to issue up to 10,000,000 shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions thereon and to increase or decrease the number of shares of any such series, but not below the number of shares of such 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 our control that may otherwise benefit holders of our common stock and may adversely affect the market price of the common stock and the voting and other rights of the holders of common stock. 

 

 

Anti-Takeover Provisions of Delaware Law and Our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws 

Section 203 of the Delaware General Corporation Law 

We are subject to Section 203 of the DGCL, which prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years after the date that such stockholder became an interested stockholder, with the following exceptions: 

 

	
 
	
•
	
before such date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; 

 

	
 
	
•
	
upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction began, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

  

	
 
	
•
	
on or after such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder. 

Section 203 defines a “business combination” to include the following: 

 

	
 
	
•
	
any merger or consolidation involving the corporation and the interested stockholder; 

 

	
 
	
•
	
any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder; 

 

	
 
	
•
	
subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder; 

 

	
 
	
•
	
any transaction involving the corporation that has the effect of increasing the proportionate share of the stock or any class or series of the corporation beneficially owned by the interested stockholder; and 

 

	
 
	
•
	
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits by or through the corporation. 

In general, Section 203 defines an “interested stockholder” as an entity or person who, together with the person’s affiliates and associates, beneficially owns, or within three years prior to the time of determination of interested stockholder status did own, 15% or more of the outstanding voting stock of the corporation. 

The statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us even though such a transaction may offer our stockholders the opportunity to sell their stock at a price above the prevailing market price. 

 

 

Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws 

Among other things, our amended and restated certificate of incorporation and amended and restated bylaws will: 

	
 
	
•
	
permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate, including the right to approve an acquisition or other change in control; 

	
 
	
•
	
provide that the authorized number of directors may be changed only by resolution of our board of directors; 

	
 
	
•
	
provide that our board of directors will be classified into three classes of directors; 

	
 
	
•
	
provide that, subject to the rights of any series of preferred stock to elect directors, directors may only be removed for cause, which removal may be effected, subject to any limitation imposed by law, by the holders of at least 66 2/3% of the voting power of all of our then-outstanding shares of the capital stock entitled to vote generally at an election of directors; 

	
 
	
•
	
provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; 

	
 
	
•
	
require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent or electronic transmission; 

	
 
	
•
	
provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide advance notice in writing, and also specify requirements as to the form and content of a stockholder’s notice; 

	
 
	
•
	
provide that special meetings of our stockholders may be called only by the chairman of our board of directors, our chief executive officer or president or by our board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors, and not by our stockholders; and 

	
 
	
•
	
not provide for cumulative voting rights, therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose. 

The amendment of any of these provisions would require approval by the holders of at least 66 2/3% of the voting power of all of our then-outstanding common stock entitled to vote generally in the election of directors, voting together as a single class. 

The combination of these provisions will make it more difficult for our existing stockholders to replace our board of directors as well as for another party to obtain control of us by replacing our board of directors. Because our board of directors has the power to retain and discharge our officers, these provisions could also make it more difficult for existing stockholders or another party to effect a change in management. In addition, 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 coercive takeover practices and inadequate takeover bids. These provisions are also designed to reduce our vulnerability to hostile takeovers 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 delaying changes in our control or management. As a consequence, these provisions may also inhibit fluctuations in the market price of our stock that could result from actual or rumored takeover attempts. We believe that the benefits of these provisions, including increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure our company, outweigh the disadvantages of discouraging takeover proposals, because negotiation of takeover proposals could result in an improvement of their terms. 

Choice of Forum 

Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware (or, if and only if the Court of Chancery of the State of Delaware lacks subject matter jurisdiction, any state court located within the State of Delaware or, if and only if all such state courts lack subject matter jurisdiction, the federal district court for the District of Delaware) is the sole and exclusive forum for the following types of actions or proceedings under Delaware statutory or common law: (i) any derivative action or proceeding brought on our behalf; (ii) any action or proceeding asserting a claim of breach of a fiduciary duty owed by any of our current or former directors, officers or other employees to us or our stockholders; (iii) any action or proceeding asserting a claim against us or any of our current or former directors, officers or other employees, arising out of or pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws; (iv) any action or proceeding to interpret, apply, enforce or determine the validity of our certificate of incorporation or our bylaws; and (v) any action asserting a claim against us or any of our directors, officers or other employees governed by the internal affairs doctrine. This provision would not apply to suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which the U.S. federal courts have exclusive jurisdiction. Nothing in our amended and restated certificate of incorporation precludes stockholders that assert claims under the Securities Act from bringing such claims in state or federal court, subject to applicable law. Our amended and restated certificate of incorporation further provides that the federal district courts of the United States is the exclusive forum for resolving any complaint asserting a cause of action under the Securities Act, unless we consent in writing to the selection of an alternative forum.

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