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exhibit41descriptionofco

                                                                     Exhibit 4.1                            DESCRIPTION OF SECURITIES                     REGISTERED UNDER SECTION 12 OF THE                        SECURITIES EXCHANGE ACT OF 1934           The following description is a general summary of the terms of the common shares, no  par value, of Materion Corporation, an Ohio corporation (the “Company”). The description  below does not include all of the terms of the common shares and should be read together with  the Company’s articles of incorporation and code of regulations, copies of which have been filed  previously with the Securities and Exchange Commission and are incorporated herein by  reference, as well as applicable provisions of Ohio law.          The Company’s authorized capital stock consists of 65,000,000 shares of stock,  including:               60,000,000 common shares, no par value; and             5,000,000 preferred shares, no par value.    Voting Rights           Each outstanding common share is entitled to one vote on each matter submitted to a vote   of shareholders. Except as outlined below or otherwise expressly required by the Company’s   articles of incorporation or by statute, the vote of the holders of shares entitling them to exercise   a majority of the voting power of the Company is required to approve any matters submitted to a   vote of the shareholders. At each annual meeting of shareholders, each director will be elected by   a plurality vote of all votes cast at such meeting for a term expiring at the next annual meeting of   shareholders and until the election of their successors. The Company’s articles of incorporation   prevent any shareholder from cumulating votes in the election of directors.            The Company’s articles of incorporation provide that, in addition to any affirmative vote   required by law or the Company’s articles of incorporation, any related party transaction shall   require the affirmative vote of not less than both a majority of the Company’s outstanding voting   stock and a majority of the portion of the Company’s outstanding voting stock excluding the   voting stock owned by the related party involved in the related party transaction, except with   respect to related party transactions (i) in which (a) the aggregate amount of the cash and the fair   market value of consideration other than cash received per share by holders of outstanding shares   of voting stock in the related party transaction is not less than the highest per share price paid by   the related party in acquiring any of its holdings of such voting stock and (b) the form of   consideration received by holders of shares of voting stock is cash or the same form of   consideration used by the related party to acquire the largest percentage of voting stock owned   by the related party and (ii) expressly approved by a majority vote of the continuing directors of   the Company.            For the purpose of the above voting requirements: (i) “related party transaction” shall   mean (a) any merger or consolidation of the Company or any of its subsidiaries with a related   party, (b) any sale, purchase, lease, exchange, transfer, or other transaction, other than in the   ordinary course of business, between the Company or any of its subsidiaries and a related party     

 

 involving the acquisition or disposition of assets for consideration of $5,000,000 or more in   value, (c) the issuance or transfer of any securities of the Company or any of its subsidiaries to a   related party (other than an issuance or transfer which is effected on a pro rata basis to all   shareholders of the Company), (d) any reclassification of securities of the Company (including  any reverse stock split) or recapitalization or other transaction involving the Company or any of   its subsidiaries that would have the effect of increasing the voting power of the related party,   except for any mandatory redemption required by the terms of outstanding securities, and (e) the   adoption of any plan or proposal for the liquidation or dissolution of the Company in favor of   which a related party votes its voting stock; (ii) “related party” shall mean (a) any individual,   corporation, partnership, or other person, group or entity which, together with its affiliates and   associates, is the beneficial owner of 10% or more, but less than 90%, of the Company’s voting   stock or (b) any such affiliate or associate; (iii) “voting stock” shall mean all securities of the   Company entitled to vote generally in the election of directors; and (iv) “continuing director”   shall mean a director who either (a) was a member of the Company’s board of directors (the   “Board”) immediately prior to the time that the related party involved in the related party   transaction became a related party or (b) was designated (before his or her initial election as a   director) as a continuing director by a majority of the then continuing directors.            Additionally, the affirmative vote of the holders of at least 66 2/3% of the Company’s   voting stock, voting as a single class, shall be required to alter, amend or adopt any provision   inconsistent with or repeal the provisions of the Company’s articles of incorporation relating to   related party transactions described above.      Dividends           Subject to any superior rights of any holders of preferred shares, each outstanding   common share will be entitled to such dividends as may be authorized and declared from time to   time by the Board out of legally available funds. The amount of dividends that the Company may   pay is restricted by the terms of the Company’s credit facilities.       Liquidation Rights           In the event of the Company’s liquidation, dissolution or winding up, holders of common   shares will be entitled to their proportionate share of any assets remaining after payment of   liabilities and any amounts due to the holders of preferred shares.       No Preemptive or Conversion Rights; No Redemption or Sinking Funds            Holders of common shares have no preemptive rights and no right to convert or exchange   their common shares into any other securities. No redemption or sinking fund provisions apply to   the Company’s common shares.      Preferred Shares           The Board is authorized, without shareholder approval, to issue up to 5,000,000 preferred  shares in one or more series and to fix the rights, preferences, privileges and restrictions granted      

 

 to or imposed upon the preferred shares, including voting rights, dividend rights, conversion   rights, terms of redemption, liquidation preference, sinking fund terms and the number of shares   constituting any series or the designation of a series. The Board can, without shareholder   approval, issue preferred shares with voting and conversion rights that could adversely affect the   voting power of the holders of common shares. Any preferred shares issued would also rank   senior to common shares as to rights up on liquidation, winding-up or dissolution. The issuance   of convertible preferred shares could have the effect of delaying, deferring or preventing a   change in control of our company.       Business Combinations with Certain Persons           Chapter 1704 of the Ohio Revised Code prohibits certain business combinations and   transactions between an “issuing public corporation” and an “Ohio law interested shareholder”   for at least three years after the Ohio law interested shareholder attains 10% ownership, unless   the board of directors of the issuing public corporation approves the transaction before the Ohio   law interested shareholder attains 10% ownership. An “issuing public corporation” is an Ohio   corporation with 50 or more shareholders that has its principal place of business, principal   executive offices, or substantial assets within the State of Ohio, and as to which no close   corporation agreement exists. An “Ohio law interested shareholder” is a beneficial owner of 10%   or more of the shares of a corporation. Examples of transactions regulated by Chapter 1704   include the disposition of assets, mergers and consolidations, voluntary dissolutions and the   transfer of shares.           Subsequent to the three-year period, a transaction subject to Chapter 1704 may take place   provided that certain conditions are satisfied, including:                 prior to the interested shareholder’s share acquisition date, the board of directors               approved the purchase of shares by the interested shareholder;              the transaction is approved by the holders of shares with at least 66 2/3% of the               voting power of the corporation (or a different proportion set forth in the articles               of incorporation), including at least a majority of the outstanding shares after              excluding shares controlled by the Ohio law interested shareholder; or             the business combination results in shareholders, other than the Ohio law              interested shareholder, receiving a fair price plus interest for their shares.           Chapter 1704 is applicable to all issuing public corporations formed under Ohio law,  unless a corporation’s articles of incorporation specifically states that Chapter 1704 does not  apply to the corporation. The Company’s articles of incorporation do not contain a provision  excluding it from the application of Chapter 1704.a2019mipplandocumentfina

                                                                                                                                            MATERION and SUBSIDIARIES                  MANAGEMENT INCENTIVE PLAN FOR THE 2019 PLAN YEAR                                       Summary Plan Document                                                                                             I.  INTRODUCTION  The Materion  and  Subsidiaries Management  Incentive Plan  for the 2019 Plan  Year  (the  “Plan”), has  been  established  by  the  Compensation  Committee  (the  “Compensation  Committee”), of  the  Company’s  Board  of  Directors  to  provide  incentive  compensation  to  certain  eligible  employees  based  principally  on  annual  financial  performance.  Plan awards have a significant portion based on Company performance and potentially Business Unit  or  Corporate  Function Performance  (“Financial  Performance”), and  a  remaining  component  that  recognizes  individual and combined contributions toward personal/team objectives ("Personal/Team Performance”).    II.  DEFINITIONS  Base Salary:  The  Participant's  annual  base  salary as  of September  30  of  the  Plan  Year will be used to calculate any earned  award.    Plan Year:  Calendar year 2019, which is the fiscal year for which Financial Performance and Personal/Team Performance, and  any Plan awards, will be calculated.    Business Unit or Corporate Function Performance:  The  Compensation  Committee  has  delegated  authority  to  the  Company’s executive staff  to  designate  the  Company’s business units/subsidiaries and corporate functions (and their eligible employees) that are eligible for  participation  in  the  Plan  for  the  Plan  Year.   Each  business  unit or  corporate  function has  defined  Financial  Performance measures, which have in turn been approved by the Compensation Committee and/or the executive  staff.  For each of these Financial Performance measures, a minimum goal, target goal and maximum goal will be  established.  Plan awards include a Financial Performance component based on Company Performance alone, or  Company Performance and/or Business Unit/Corporate Function Performance.     Company Performance:  The Company   Performance  portion  of  the Financial  Performance  component  of  Plan  awards  will  consist  of  an  Operating Profit measure (weighted at 70%), a Growth in Value-added Sales measure (weighted at 15%) and a  Simple Free Cash Flow measure (weighted at 15%).    Operating Profit (“OP”):  Operating Profit is defined as profit or loss, before interest and taxes, and for domestic and international operations,  OP  will  include  accrued  performance  or  incentive  compensation. Any  adjustment  to  exclude  the  effect  of  any  extraordinary,  unusual  or  non-reoccurring  items  will  be  subject  to  review  and  approval  by  the  Compensation  Committee.      Growth in Value-added Sales (“VAS”):  Growth in Value-added Sales is defined as the percent increase in VAS for the Plan Year over the prior year. VAS is  the amount equal to (1) the Company’s sales for the Plan Year minus (2) the aggregate cost to the Company for the  Plan Year of gold, silver, platinum, palladium and copper.      Simplified Free Cash Flow (“SFCF”):  Simple Free Cash Flow is defined as the amount equal to (1) operating profit plus depreciation and amortization  minus  (2) the change  in working capital  (accounts  receivable,  accounts  payable,  and  inventory)  and capital  investments.                                                    Approved by Compensation Committee January 29, 2019                                                                                                                                                                                       Page 1 of 4                                                                                                    

 

                                                                                                             Other Metrics:  From  time  to  time,  other  metrics  may  be  adopted  that  are  aligned  with  a  business  unit’s  strategy  and  market  challenges or  a  corporate  function’s  strategic  imperatives.   These metrics  will  be  defined  and  tracked  by  the  corporate accounting department, subject to approval by the executive staff.    Personal/Team Performance:  An assessment is made of an individual's achievements and his/her contributions to work/project teams during the  Plan  Year.   This  assessment  is  expressed  as  a percentage  of Base Salary. The  Personal/Team  Performance  component is distinct from the Financial Performance component.    Performance Objectives:  Performance  Objectives  shall  mean  the  measurable  performance  objective  or  objectives  established  for  Participants under the Plan for the Plan Year.  The Compensation Committee may provide for such adjustments in  the  Performance  Objectives  or  their  evaluation  as  it  may  deem  necessary  or  appropriate  for  purposes  of  administering this Plan.    Target Annual Award Opportunity   Each  Plan  Year,  MIP  eligible  participants  will  be  assigned  a Target Annual Award Opportunity,  expressed  as  a  percent of Base Salary.    III.  PARTICIPATION  At the beginning of the Plan Year, the executive staff will, based on delegated authority from the Compensation  Committee, identify exempt salaried employees whose responsibilities affect progress on critical issues facing the  Company, and those employees will participate in the Plan for the Plan Year.  Those individuals selected by the  executive staff will be notified of their participation in the Plan, their Target Annual Award Opportunity and applicable  business unit designation.     Following the beginning of the Plan Year, the executive staff may admit new hires or individuals who are promoted  or assigned additional and significant responsibilities to also participate in the Plan for the Plan Year.  The executive  staff may also alter Target Annual Award Opportunities to reflect changed responsibilities of participants during the  Plan Year.    An employee  who  replaces  or  otherwise  assumes  the  job  functions  or  role  of  another  employee  does  not  automatically  assume  the  Plan  participation  characteristics  that  had  applied  to  such  other  employee.  Rather,  participation by the new or replacing employee must be individually considered and approved by the executive staff.    Participants who are newly employed before April 1 of the Plan Year are eligible for full participation in the Plan for  such Plan Year. Participants who are newly employed on or after April 1 of the Plan Year and before July 1 of the  Plan Year (or comparable date for any Plan Year that does not mirror the calendar year), are eligible for half of any  Plan award available based on Personal/Team Performance and Financial Performance for the Plan Year.    Plan awards for Participants who transfer from the Exempt Salaried Incentive Plan to the Plan for purposes of the  Plan  Year, will  be  prorated  to  the  beginning  of  the  month  following  the  employee’s  transfer  to  the  Plan.   The  transferred employee’s eligibility under the Exempt Salaried Incentive Plan will cease for the Plan Year.      Changes  in a Target Annual Award opportunity during  a  Plan  Year will  result  in  prorated  participation  for  Plan  awards.    The eligibility of employees hired or with changed job responsibilities after June 30 of the Plan Year (or comparable  date for any Plan Year that does not mirror the calendar year) will not be considered for participation in the Plan until  a possible, subsequent Plan Year.    Normally, employees who participate in any other annual incentive, commission or performance compensation plan  of the Company or as a subsidiary are not eligible.  The executive staff may consider prorated participation in the  Plan for the Plan Year under special circumstances.    Approved by Compensation Committee January 29, 2019                                                                                                                                                                                   Page 2 of 4   

 

                                                                                                             With two exceptions, Participants must be employed on the day award payments are issued in order to be eligible  for  any plan  award.   For  a  Participant  who  becomes  eligible  for  and  who  elects  a  severance  option  under  the  Chronic Beryllium Disease Policy as amended, any award under the Plan will be prorated to the beginning of the  month after the employee exercises the severance option.  The second exception pertains to either the death of the   participant or the retirement (at age 65, or at age 55 or older with 10 years of service), in which case, any Plan  award will be prorated to the beginning of the month following the employee’s death or the employee’s retirement  date, as applicable.  In no event will a prorated Plan award be earned where the proration percent is less than one- third (1/3).    Participants who have been on a leave of absence in excess of 13 weeks during the Plan Year will have their Plan  award reduced on a pro-rata basis to reflect their actual contribution.    IV. TARGET ANNUAL AWARD OPPORTUNITY  The  Compensation  Committee  (or executive staff),  along  with  a  Participant’s  assigned  salary grade level will  determine  the Target Annual Award Opportunity,  as  a  percent  of  Base  Salary, for  participants  in the MIP.  The  Target Annual Award Opportunity for participants in salary levels A, B, and C will be individualized as determined by  the  Compensation  Committee  or executive staff. The Target Annual Award Opportunity for participants in salary  levels D, E, and EE will be determined by their salary grade level and executive staff.    Below  is  a  summary  of  the Target  Annual Award Opportunities at  minimum,  target,  and  maximum  goal  achievement, as a percent of Base Salary, for the 2019 Plan Year:                         Financial               Personal /Team              Total Award                                                            2    Level            Performance               Performance                Opportunity              Min.      Target       Max.   Min.   Target  Max.     Min.     Target     Max.      A – C           Individualized 1                                     Individualized 1                         20% or                                     5.00%     30.00%     60 %     D              25%        15%        200%     0%     10%     20%    3.75%     25.00%     50 %               of                     of             Target     10% or      Target                         2.50%     20.00%     40 %     E                         5%                                        1.25%     15.00%     30 %     EE                  5%                  0%     5%      10%    1.25%     10.00%     20 %           1 Determined by Compensation Committee or executive staff                                 2 Excludes Named Executive Officers (NEOs)                                               V. PLAN AWARD OPPORTUNITY FOR FINANCIAL PERFORMANCE COMPONENT  The Compensation Committee (or the executive staff) will establish minimum, target and maximum goals for each  Financial Performance component of a Plan award opportunity.  The executive staff will assign Participants to a  specific business unit/subsidiary or corporate function for the Financial Performance component of Plan awards.            Performance that reaches the minimum level of a Financial goal will result in an award of 25 percent of the target  opportunity for that measure. Unless the minimum level goal for Operating Profit has been met, no other Financial  Performance component of plan awards (business unit, company, function, sub-unit, and/or other measurement),  will result in an award greater than 100 percent of the target opportunity for that measure.      Performance that reaches or exceeds the maximum goal of a measure will result in an award at 200 percent of  target opportunity for that measure.  Award amounts for levels of achievement between minimum and target         Approved by Compensation Committee January 29, 2019                                                                                                                                                                                   Page 3 of 4   

 

                                                                                                           goals,  at  target  goals, and  between  target  and  maximum goals will  be  prorated  according  to  the  level  of  achievement.    The Financial Performance portion of awards will be prorated for transfers between units (or between business  unit and Corporate) according to the length of service by months in each unit during the Plan Year.    VI. PLAN AWARD OPPORTUNITY FOR PERSONAL/TEAM PERFORMANCE COMPONENT  The funding pool of the Personal/Team performance component will be determined by the financial results against  the goals in the Financial Performance component of the Plan. For target levels of performance, the funding of the  Personal/Team award pool will be 10 percent of base salary for Grades A through E, and 5 percent for Grade EE.  The Personal/Team funding pool will be adjusted up or down based on the actual business financial performance.  Performance  that  reaches  the  minimum  level  of  a financial  goal  will  result  in  funding  of  25  percent, and  Performance that reaches the maximum level of a financial goal will result in funding of 140 percent. The funding  between minimum and target and target and maximum will be prorated according to the level of achievement.     The business unit executive  and  the executive staff will  decide  allocation  of the pool among eligible participants  based  on  their  performance  throughout  the  Plan  year  relative  to  achieving  established  goals  and  objectives.   Personal/Team  incentive  awards  may  range  from  0% to  200%  of  a  participant’s  Personal/Team  target incentive  opportunity based on their individual performance.  The aggregate total dollar amount of awards within each group  may not exceed its total funded pool.    VII.  PAYMENT  Distribution of any payouts for plan awards earned under the Plan to participants will be made in March of the year  following the Plan Year.    VIII.  GENERAL PROVISIONS  The executive staff has authority to make administrative decisions regarding the Plan.     The Company’s Board of Directors, through the Compensation Committee, shall have final and conclusive authority  for interpretation, application, and possible modification of this Plan or established targets. The Board of Directors,  through the Compensation Committee, reserves the right to amend or terminate the Plan at any time.  Subject to  the  preceding  sentences,  any  determination  by  the  Company's  independent  accountants  shall  be  final  and  conclusive as it relates to the calculation of financial results.    This Plan is not a contract of employment.      Approved by Compensation Committee January 29, 2019                                                                                                                                                                                   Page 4 of 4

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