Document:

EX-10.1

 Exhibit 10.1 

THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED OR HYPOTHECATED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, AND APPLICABLE STATE SECURITIES LAWS, COVERING ANY SUCH TRANSACTION INVOLVING SAID SECURITIES, (B) THE COMPANY RECEIVES AN OPINION OF LEGAL
COUNSEL FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO THE COMPANY STATING THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION, OR (C) THE COMPANY OTHERWISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION. 

Date of Issuance: March 16, 2020 

Amended and Restated as of March 1, 2022 

AMENDED AND RESTATED WARRANT TO PURCHASE CLASS A COMMON 

STOCK OF CELULARITY INC. 
 For value
received, Celularity Inc., a Delaware corporation (the “Company”), hereby grants to [________] (“Holder”) this warrant to purchase that number of shares of the Company’s Class A Common Stock
(defined below) as set forth in Section 2.2 hereof, as may be adjusted from time to time pursuant to Section 12 hereof. This Amended and Restated Warrant, supersedes, amends and restates, in its
entirety, the Warrant to Purchase Series B Preferred Stock of Celularity Inc. (now known as Celularity LLC and a wholly-owned subsidiary of the Company (“Legacy Celularity”)), and originally issued by Legacy Celularity to the
Holder on March 16, 2020 and amended effective as of January 8, 2021, which was assumed by the Company effective July 16, 2021 upon the closing of the Merger (as defined in the following agreement) and became exercisable for shares of
the Company’s Class A Common Stock pursuant to that certain Agreement and Plan of Merger and Reorganization dated January 8, 2021 by and among the Company and Legacy Celularity, among others. 

1. Definitions. 

“Business Days” shall mean any day other than a Saturday, a Sunday or any other day on which the Federal Reserve Bank
of New York is required by Law to be closed. 
 “Change of Control” shall mean a transaction or a series of related
transactions involving (i) a consolidation or merger of the Company which results in the stockholders of the Company immediately prior to the transaction owning less than a majority of the equity or voting power of the surviving entity,
(ii) the sale, transfer or lease of all or substantially all of the Company’s assets taken as a whole together with any assets of the Company’s subsidiaries, whether by merger, consolidation or otherwise, and whether in a single
transaction or a series of related transactions, (iii) the grant of an exclusive license to all or substantially all of the Company’s intellectual property that is used to generate all or substantially all of the Company’s revenues,
or (iv) any sale of all or substantially all of the Company’s equity or any other transaction which results in the stockholders of the Company immediately prior to the transaction owning less than a majority of the equity or voting power
of the surviving entity but not including any transaction or series of transactions principally for bona fide equity financing purposes in which cash is received by the Company or indebtedness of the Company is cancelled or converted (or a
combination thereof). 

  
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 “Class A Common Stock” shall mean
the Class A Common Stock, par value $0.0001 per share, of the Company. 
 “Date of Issuance” means the date of
issuance first written above. 
 “Starr Holders” means the holders of the Starr Warrants that, with the written
consent of the Company, are necessary to amend, modify and/or waive this Warrant pursuant to Section 11.1 hereof. 

“Starr Shares” means at least a majority of the aggregate shares of capital stock then issuable upon the exercise of
all Starr Warrants. 
 “Starr Warrants” shall have the meaning assigned to it in the Stock Purchase Agreement. 

“Stock Purchase Agreement” shall mean that certain Series B Preferred Stock Purchase Agreement, dated as of
March 16, 2020, by and among Legacy Celularity and the Investors listed on Schedule A thereto. 
 “Trading
Market” “ means any of the following markets or exchanges on which the Class A Common Stock is listed or quoted for trading on the date in question: the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select
Market, the NYSE American or the New York Stock Exchange (or any successors to any of the foregoing). 
 “VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (i) if the Class A Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Class A Common
Stock for such date (or the nearest preceding date) on the Trading Market on which the Class A Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New
York City time)); (ii) if the Class A Common Stock is not then listed or quoted on a Trading Market, but is listed or quoted on OTCQB or OTCQX, the volume weighted average price of the Class A Common Stock for such date (or the nearest
preceding date) on OTCQB or OTCQX, as applicable; (iii) if the Class A Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Class A Common Stock are then reported on The Pink Open Market (or a
similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Class A Common Stock so reported; or (iv) in all other cases, the fair market value of a share of Class A
Common Stock as determined by an independent appraiser selected in good faith by the holders of a majority in interest of the Starr Shares then outstanding and reasonably acceptable to the Company. 

“Warrant” as used herein shall include this amended and restated warrant (as the same may be amended from time to
time) and any warrants delivered in substitution or exchange therefor as provided herein. 

  
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 2. Exercise Amont and Price. 

2.1 The exercise price per share (the “Exercise Price”) at which this Warrant will be exercised shall be $3.50. 

2.2 This Warrant is exercisable for the purchase of [________] shares of Class A Common Stock (as such number may be adjusted from time
to time pursuant to Section 12 hereof). 
 3. Term. 

3.1 Subject to the terms and conditions set forth herein, the Holder may exercise this Warrant, in whole or in part, during the term commencing
on the Date of Issuance and ending at 5:00 p.m. (Eastern Time) on the first to occur of: (a) the 60-month anniversary of the Date of Issuance or (b) the consummation of a Change of Control following
the date of this Warrant. The Company will give Holder not less than twenty (20) days’ advance written notice of a transaction in the event of a Change of Control. 

4. Exercise of Warrant. 

4.1 The purchase rights represented by this Warrant are exercisable by the Holder in whole or in part, at any time, or from time to time,
during the term hereof as described in Section 3 above, by the surrender of this Warrant and the Notice of Exercise, attached hereto as Exhibit A, duly completed and executed on behalf of the Holder, at the principal
offices of the Company (or such other office or agency of the Company as it may designate by notice in writing to the Holder), upon payment in cash, wire transfer or by check acceptable to the Company of the Exercise Price of the shares to be
purchased (the “Shares”). 
 4.2 From time to time following the completion of the first Trading Day immediately
following July 16, 2021, in lieu of payment of the aggregate Exercise Price in the manner as specified in Section 4.1, but otherwise in accordance with the requirements of Section 4.1, the
Holder may elect to receive the Shares equal to the value of this Warrant, or portion hereof as to which this Warrant is being exercised. Upon such exercise pursuant to this Section 4.2, the Holder shall be issued such
number of fully paid and non-assessable Shares as are computed using the following formula: 
 X = Y(A-B)/A 
 where: 

X = the number of Shares to be issued to the Holder; 

Y = the number of Shares with respect to which this Warrant is being exercised; 

A = the VWAP on the Trading Date immediately preceding the date of the applicable Notice of Exercise; and 

B = the Exercise Price. 

  
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 5. Representations and Warranties of the Company. 

5.1 The Company hereby represents and warrants to Holder that the following representations and warranties are true and correct: 

(a) Organization, Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as now conducted and as proposed to be conducted. The Company is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material adverse effect on its business or properties. 
 (b)
Authorization. All corporate action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution and delivery of this Warrant, the performance of all obligations of the Company hereunder and
thereunder, and the reservation for issuance, sale and delivery of the Class A Common Stock to be issued upon exercise of this Warrant has been taken. This Warrant constitutes the valid and legally binding obligation of the Company, enforceable
against the Company in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, and
(ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies. 
 (c)
Valid Issuance of Common Stock. The Class A Common Stock for which the Warrant is exercisable, when issued, sold and delivered in accordance with the terms of this Warrant for the consideration expressed herein, will be duly and validly
issued, fully paid, and nonassessable, and will be free of restrictions on transfer other than restrictions on transfer under this Warrant and under applicable state and federal securities laws or liens or encumbrances created by or imposed by
Holder. 
 (d) Governmental Consents. No consent, approval, order or authorization of, or registration, qualification, designation,
declaration or filing with, any federal, state or local governmental authority on the part of the Company is required in connection with the issuance or exercise of this Warrant, except for (i) such federal and state securities filings as may
be necessary, which filings will be timely effected after the date hereof and (ii) such other approval that has been obtained prior to the date hereof. 

(e) Reliance by Holder. The Company understands that the representations, warranties, covenants and acknowledgements set forth in this
Section 5 constitute a material inducement to Holder entering into this Warrant. 
 6. Representations and Warranties of Holder.

 6.1 Holder hereby represents and warrants to the Company that the following representations and warranties are true and correct: 

  
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 (a) Purchase Entirely for Own Account. This Warrant is being entered into for
investment for Holder’s own account not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and Holder has no present intention of selling, granting any participation in, or otherwise distributing the
same. The acquisition by Holder of this Warrant shall constitute confirmation of the representation by Holder that it does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to this Warrant. 
 (b) Investment Experience. Holder is an investor in securities of
companies in the development stage and acknowledges that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits
and risks of entering into this Warrant. Holder acknowledges that the acquisition of shares of Class A Common Stock pursuant to this Warrant involves a high degree of risk, and represents that it is able, without materially impairing its
financial condition, to hold such shares for an indefinite period of time and to suffer a complete loss of its investment. Holder acknowledges that the Company has not made any representations or warranties as to whether the Exercise Price to be
paid by Holder for the Class A Common Stock is a fair value for such shares and the Company takes no position with respect to the fairness of the Exercise Price or the future prospects and valuation of the Company. Holder is aware of the fact
that the value of the Class A Common Stock to be purchased upon exercise of this Warrant may significantly depreciate over time and there can be no assurances that the value of such shares will increase or to what extent. In connection with
making an investment decision in connection with entering into this Warrant, Holder will be relying on its own knowledge and experience and advice obtained from Holder’s legal, tax and financial advisor. 

(c) Accredited Investor. Holder is an “accredited investor” within the meaning of SEC Rule 501 of Regulation D, as presently
in effect. 
 (d) Legends. It is understood that the certificates, if any, evidencing the shares of Class A Common Stock
issuable upon exercise of this Warrant may bear any of the legends required by applicable state securities laws. 
 (e) Reliance by
Company. Holder understands that the representations, warranties, covenants and acknowledgements set forth in this Section 6 constitute a material inducement to the Company entering into this Warrant. 

(f) Foreign Investors. Holder hereby represents that it has satisfied itself as to the full observance of the laws of its jurisdiction
in connection with entering into this Warrant, including (i) the legal requirements within its jurisdiction for entering into this Warrant and the exercise of this Warrant, (ii) any foreign exchange restrictions applicable to the exercise
of this Warrant, (iii) any governmental or other consents that may need to be obtained, including with respect to the payment of the Exercise Price, and (iv) the income tax and other tax consequences, if any, that may be relevant to the
purchase, holding, redemption, sale or transfer of this Warrant or the shares of Class A Common Stock issuable upon exercise hereof. The Holder’s acquisition of this Warrant and payment for the Class A Common Stock upon exercise of
this Warrant and continued beneficial ownership of such shares will not violate any applicable securities or other laws of the Holder’s jurisdiction. 

7. No Fractional Shares. No fractional share of any class or series of the Company’s capital stock shall be issued upon exercise of
this Warrant. 

  
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 8. Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction, or mutilation of this Warrant and (a) in the case of loss, theft, or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and substance to the Company or (b) in the
case of mutilation, on surrender and cancellation of this Warrant, the Company shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor and amount. The Holder shall reimburse the Company for all reasonable expenses incidental
to replacement of this Warrant. 
 9. Rights of Stockholder. This Warrant shall not entitle its holder to any of the rights of a
stockholder of the Company until this Warrant shall have been exercised and the shares of Class A Common Stock purchasable upon the exercise hereof shall have been issued. 

10. Notice of Certain Events. Whenever the Exercise Price or number of shares purchasable hereunder shall be adjusted pursuant to
Section 12 hereof and if so requested by Holder, the Company shall issue a certificate signed by its Chief Financial Officer, or other similar officer, setting forth in reasonable detail the event requiring the adjustment, the amount of the
adjustment, the method by which such adjustment was calculated and the Exercise Price and number of shares purchasable hereunder after giving effect to such adjustment and shall cause a copy of such certificate to be mailed (by first class mail,
postage prepaid) to the Holder of this Warrant. 
 11. Amendments; Waivers. 

11.1 Amendments. The provisions of this Warrant may be amended (either generally or in a particular instance and either
retroactively or prospectively), only by an instrument in writing signed by the Company and the holders of warrants to acquire at least a majority of the aggregate shares of capital stock then issuable upon exercise of all Starr Warrants (as defined
in the Stock Purchase Agreement); provided, however, that any such amendment that materially and adversely affects the Holder in a manner different from the other holders of Starr Warrants shall require the separate consent of the Holder
hereof. In addition, subject to the proviso in the preceding sentence, Holder agrees that such Holder’s rights hereunder may be waived or amended by persons or entities holding Starr Warrants to acquire at least a majority of the aggregate
shares of capital stock issuable upon exercise of all Starr Warrants without obtaining any additional consents of the Holder. The foregoing shall not limit or otherwise affect Holder’s right to waive any of such Holder’s rights hereunder
with respect to itself without obtaining the consent of any other holder of the Starr Warrants. Any amendment or waiver effected in accordance with this Section 11.1 shall be binding upon Holder and Holder’s successors and assigns.

 11.2 Waivers. No waivers of or exceptions to any term, condition or provision of this Warrant, in any one or more
instances, shall be deemed to be or construed as a further or continuing waiver of any such term, condition or provision. 
 12.
Adjustments. The Exercise Price and the number and type of shares purchasable hereunder are subject to adjustment from time to time as follows: 

  
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 12.1 Reclassification, etc. If, at any time on or after the date hereof and
while this Warrant remains outstanding and unexpired, the Company shall, by reclassification of securities or otherwise, change any of the securities as to which purchase rights under this Warrant exist into the same or a different number of
securities of any other class or classes, this Warrant shall thereafter represent the right to acquire such number and kind of securities as would have been issuable as the result of such change with respect to the securities which were subject to
the purchase rights under this Warrant immediately prior to such reclassification or other change and the Exercise Price therefor shall be appropriately adjusted, all subject to further adjustment as provided in this Section 12;
provided, however, that the aggregate Exercise Price shall remain the same. 
 12.2 Split, Subdivision or Combination of
Shares. If at any time on or after the date hereof and while this Warrant remains outstanding and unexpired, the Company shall split, subdivide or combine the securities as to which purchase rights under this Warrant exist into a different
number of securities of the same class, the Exercise Price for such securities shall be proportionately decreased in the case of a split or subdivision or proportionately increased in the case of a combination. Upon an adjustment in the Exercise
Price pursuant to this Section 12.2, the number of shares subject to this Warrant (which were the subject of such split, subdivision or combination) shall be adjusted accordingly such that the aggregate Exercise Price payable for the
purchase of such shares shall remain the same as before such split, subdivision or combination. 
 12.3 Adjustments for Dividends in
Stock or Other Securities or Property. If at any time on or after the date hereof and while this Warrant remains outstanding and unexpired, the holders of the securities as to which purchase rights under this Warrant exist at the time shall
have received, or on or after the record date fixed for the determination of eligible stockholders shall have become entitled to receive, without payment therefor, other or additional stock or other securities or property (other than cash) of the
Company by way of dividend or other distribution in respect of the Class A Common Stock, then, and in each case, this Warrant shall represent the right to acquire, in addition to the number of shares of the security receivable upon exercise of
this Warrant and without payment of any additional consideration therefor, the amount of such other or additional stock or other securities or property (other than cash) of the Company which such holder would hold on the date of such exercise had it
been the holder of record of the security receivable upon exercise of this Warrant on the date hereof and had thereafter, during the period from the date hereof to and including the date of such exercise, retained such shares and/or all other
additional stock available by it as aforesaid during such period, giving effect to all adjustments called for during such period by the provisions of this Section 12, and, from and after the date of such distribution, the Company shall hold and
set aside (or cause to be held and set aside in a commercially reasonable manner) an amount of such property equal to Holder’s pro rata portion thereof for distribution to Holder pursuant hereto. 

13. Reservation of Capital Stock. The Company shall at all times reserve and keep available a number of its authorized but
unissued shares of Class A Common Stock that shall be sufficient to permit the exercise in full of all outstanding warrants issued pursuant to this Warrant. 

  
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 14. Miscellaneous. 

14.1 Survival of Representations, Warranties and Covenants. The warranties, representations and covenants of each party hereto contained
in or made pursuant to this Warrant shall survive the execution and delivery of this Warrant and shall in no way be affected by any investigation of the subject matter thereof made by or on behalf of the Holder or the Company, as applicable. 

14.2 Titles and Subtitles. The titles and subtitles used in this Warrant are used for convenience only and are not to be considered in
construing or interpreting this Warrant. 
 14.3 Governing Law. This Warrant is to be construed in accordance with and governed by
the internal laws of the State of Delaware without giving effect to any choice of law rule that would cause the application of the laws of any jurisdiction other than the internal laws of the State of Delaware to the rights and duties of the
parties. All disputes and controversies arising out of or in connection with this Warrant shall be resolved exclusively by the state or federal courts located within the City of Wilmington in the State of Delaware, and each party hereto agrees to
submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts. 
 14.4 Waiver of Right to Jury
Trial. EACH OF HOLDER AND THE COMPANY, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING
TO THIS WARRANT. 
 14.5 Notices. Except as may be otherwise provided herein, all notices, requests, waivers and other communications
made pursuant to this Warrant shall be in writing and shall be conclusively deemed to have been duly given (i) when hand delivered to the other party; (ii) when sent by email or facsimile if sent between 8:00 a.m. and 5:00 p.m.
recipient’s local time on a Business Day, or on the next Business Day if sent by email or facsimile other than between 8:00 a.m. and 5:00 p.m. recipient’s local time on a Business Day; (iii) seven Business Days after deposit in the
U.S. mail with first class or certified mail receipt requested postage prepaid and addressed to the other party; or (iv) the next Business Day after deposit with an international overnight delivery service, postage prepaid, addressed to the
parties with next Business Day delivery guaranteed, provided that the sending party receives a confirmation of delivery from the delivery service provider. Each person making a communication hereunder by email or facsimile shall promptly confirm by
telephone between 8:00 a.m. and 5:00 p.m. recipient’s local time on a Business Day to the person to whom such communication was addressed each communication made by it by email or facsimile pursuant hereto but the absence of such confirmation
shall not affect the validity of any such communication. All communications shall be sent to the address, email address or facsimile number of a party appearing in its signature block hereto or at such address, email address or facsimile number as
such party may designate by ten (10) days advance written notice to the other parties hereto. 
 14.6 Specific Performance. Each
party hereto acknowledges and agrees that any breach of this Warrant would result in substantial harm to the other party hereto for which monetary damages alone could not adequately compensate. Therefore, the parties hereto unconditionally and
irrevocably agree that any non-breaching party hereto shall be entitled to seek protective orders, injunctive relief and other remedies available at law or in equity (including, without limitation, seeking
specific performance). 

  
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 14.7 Counterparts. This Warrant may be executed and delivered by facsimile signature
and in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic
signature complying with the U.S. federal ESIGN Act of 2000, e.g.www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

 [Remainder of Page Intentionally Left Blank] 

  
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 IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly
authorized officer as of the Date of Issuance indicated above. 
  

			
	COMPANY:
	
	CELULARITY INC.
		
	By:	 	          

		 	Name: Robert J. Hariri, M.D., Ph.D
		 	Title: Founder, CEO and President
		
		 	Address:
		
		 	Celularity Inc.
		 	170 Park Ave
		 	Florham Park, New Jersey 07932

 [Signature Page to A&R Warrant] 

			
		 	ACKNOWLEDGED AND AGREED:
		
		 	HOLDER:
		
		 	[________]
		
	By:	 	  

		 	Name:
		 	Title:
		
		 	Address:
		
		 	[________]
		
		 	With a copy to:
		
		 	[________]

 [Signature Page to A&R Warrant] 

 EXHIBIT A 

NOTICE OF EXERCISE 

 

	To:	 Celularity Inc. 

170 Park Ave 
 Florham Park, New
Jersey 07932 
 By checking the appropriate line, the undersigned (“Holder”), pursuant to the provisions set forth
in the Amended and Restated Warrant to Purchase Class A Common Stock, dated March 1, 2022 (the “Warrant”), hereby elects to purchase [________] shares of Class A Common Stock (as defined in the Warrant)
pursuant to the terms of the Warrant, and tenders herewith payment of the purchase price for such shares in full as follows: 
  

			
	 ☐
	  	check in the amount of $______ payable to order of the Company enclosed herewith
		
	 ☐
	  	wire transfer of immediately available funds to the Company’s bank account
		
	 ☐
	  	cashless exercise pursuant to Section 4.2 of the Warrant

  

                          
   
 Date 
  

	
	  
 [Print Name]

 

	
	  
  

 

	Signatureannx-ex43_9.htm

 

 

 

Exhibit 4.3

 

DESCRIPTION OF REGISTRANT’S SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF THE

SECURITIES EXCHANGE ACT OF 1934

Annexon, Inc. has common stock, $0.001 par value per share, registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and listed on The Nasdaq Global Select Market under the trading symbol “ANNX.”

DESCRIPTION OF CAPITAL STOCK

The following summary describes our capital stock and the material provisions of our amended and restated certificate of incorporation, our amended and restated bylaws and the amended and restated investors’ rights agreement to which we and certain of our stockholders are parties and the applicable provisions of the Delaware General Corporation Law (the “DGCL”). Because the following is only a summary, it does not contain all of the information that may be important to you. For a complete description, you should refer to our amended and restated certificate of incorporation, amended and restated bylaws and amended and restated investors’ rights agreement, each of which has been publicly filed with the U.S. Securities and Exchange Commission (the “SEC”). 

General 

Our authorized capital stock consists of 300,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 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, including the election of directors. The election of directors by our stockholders shall be determined by a plurality of the votes cast and our stockholders do not have cumulative voting rights in the election of directors. Other matters shall be generally decided by the affirmative vote of the holders of a majority of the votes cast (excluding abstentions and broker non-votes) on such matter. In addition, the affirmative vote of holders of 66 2/3% of the voting power of all of the then outstanding voting stock will be required to take certain actions, including amending certain provisions of our amended and restated certificate of incorporation, including the provisions relating to amending our amended and restated bylaws, the classified board and director liability. 

Dividends 

Subject to preferences that may be applicable to any then outstanding preferred stock, holders of our common stock are entitled to receive dividends as may be declared from time to time by our board of directors out of legally available funds. 

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, subject to the satisfaction of any liquidation preference granted to the holders of any then outstanding shares of preferred stock. 

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 our 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. 

Preferred Stock 

Our board of directors has the authority, without further action by our stockholders, to issue up to 5,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof. These rights, preferences and privileges could include dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking fund terms and the number of shares constituting, or the designation of, such series, any or all of which may be greater than the rights of our common stock. The issuance of our preferred stock could adversely affect the voting power of holders of common stock and the likelihood that such holders will receive dividend payments and payments upon our liquidation. In addition, the issuance of preferred stock could have the effect of delaying, deferring or preventing a change in control of our company or other corporate action. 

Registration Rights 

Under our amended and restated investors’ rights agreement, certain holders of shares of our common stock, or their transferees, have the right to require us to register their shares under the Securities Act of 1933, as amended (the “Securities Act”), so that those shares may be publicly resold, and certain holders of shares of our common stock, or their transferees, have the right to include their shares in any registration statement we file, in each case as described below. 

Demand Registration Rights 

Certain holders of shares of our common stock are entitled to certain demand registration rights. The holders of at least 60% of such registrable securities may, on not more than two occasions, request that we register all or a portion of their shares, subject to certain specified exceptions.  

Piggyback Registration Rights 

In the event that we propose to register any of our securities under the Securities Act, either for our own account or for the account of other security holders, certain holders of registrable securities will be entitled to certain “piggyback” registration rights allowing them to include their shares in such registration, subject to specified conditions and limitations. 

S-3 Registration Rights 

Certain holders of shares of our common stock are entitled to certain Form S-3 registration rights. The holders of at least 30% of such registrable securities may, on not more than two registrations on Form S-3 within any 12-month period, request that we register all or a portion of their shares on Form S-3 if we are qualified to file a registration statement on Form S-3, subject to specified exceptions. Such request for registration on Form S-3 must cover securities with an aggregate offering price which equals or exceeds $1.0 million, net of selling expenses. The right to have such shares registered on Form S-3 is further subject to other specified conditions and limitations. 

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

Certain provisions of Delaware law and our amended and restated certificate of incorporation and our amended and restated bylaws contain provisions that could make the following transactions more difficult: acquisition of us by means of a tender offer; acquisition of us by means of a proxy contest or otherwise; or 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 that might result in a premium over the market price for our shares. 

These provisions, summarized below, are expected 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 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. 

Delaware Anti-Takeover Statute 

We are subject to Section 203 of the DGCL, which prohibits persons deemed “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, such as discouraging takeover attempts that might result in a premium over the market price of our common stock. 

Undesignated Preferred Stock 

The ability to authorize 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 effect a change in control of our company. These and other provisions may have the effect of deterring hostile takeovers or delaying changes in control or management of our company. 

Special Stockholder Meetings 

Our amended and restated certificate of incorporation provide that a special meeting of stockholders may be called at any time by our board of directors, but such special meetings may not be called by the stockholders or any other person or persons. 

Requirements for Advance Notification of Stockholder Nominations and Proposals 

Our amended and restated bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors. 

Stockholder Action by Written Consent 

Our amended and restated certificate of incorporation precludes stockholder action by written consent without a meeting. 

Classified Board; Election and Removal of Directors; Filling Vacancies 

Our board of directors is divided into three classes, divided as nearly as equal in number as possible. The directors in each class serve for a three-year term, one class being elected each year by our stockholders, with staggered three-year terms. Only one class of directors will be elected at each annual meeting of our stockholders, with the other classes continuing for the remainder of their respective three-year terms. Because our stockholders do not have cumulative voting rights, our stockholders holding a majority of the shares of common stock outstanding will be able to elect all of our directors. Our amended and restated certificate of incorporation provides for the removal of any of our directors only for cause and requires a stockholder vote by the holders of at least a 66 2/3% of the voting power of the then outstanding voting stock. Furthermore, any vacancy on our board of directors, however occurring, including a vacancy resulting from an increase in the size of the board, may only be filled by a resolution of the board of directors unless the board of directors determines that such vacancies shall be filled by the stockholders. This system of electing and removing directors and filling vacancies may tend to discourage a third party from making a tender offer or otherwise attempting to obtain control of us because it generally makes it more difficult for stockholders to replace a majority of the directors. 

 

 

Choice of Forum 

Our amended and restated certificate of incorporation and amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the exclusive forum for the following types of actions or proceedings under Delaware statutory or common law: any derivative action or proceeding brought on our behalf; any action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or stockholders to us or to our stockholders; any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our amended and restated certificate of incorporation or our amended and restated bylaws (as either may be amended from time to time); or any action asserting a claim against us that is governed by the internal affairs doctrine. As a result, any action brought by any of our stockholders with regard to any of these matters will need to be filed in the Court of Chancery of the State of Delaware and cannot be filed in any other jurisdiction; provided that, the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction; and provided further that, if and only if the Court of Chancery of the State of Delaware dismisses any such action for lack of subject matter jurisdiction, such action may be brought in another state or federal court sitting in the State of Delaware. Our amended and restated certificate of incorporation and amended and restated bylaws will also provide that the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action against us or any of our directors, officers, employees or agents and arising under the Securities Act. Nothing in our amended and restated certificate of incorporation and amended and restated bylaws preclude stockholders that assert claims under the Exchange Act from bringing such claims in state or federal court, subject to applicable law. 

If any action the subject matter of which is within the scope described above is filed in a court other than a court located within the State of Delaware, or a Foreign Action, in the name of any stockholder, such stockholder shall be deemed to have consented to the personal jurisdiction of the state and federal courts located within the State of Delaware in connection with any action brought in any such court to enforce the applicable provisions of our amended and restated certificate of incorporation and amended and restated bylaws and having service of process made upon such stockholder in any such action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder. Although our amended and restated certificate of incorporation and amended and restated bylaws will contain the choice of forum provision described above, it is possible that a court could find that such a provision is inapplicable for a particular claim or action or that such provision is unenforceable. 

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or stockholders, which may discourage lawsuits with respect to such claims, although our stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder. 

Amendment of Charter Provisions 

The amendment of any of the above provisions in our amended and restated certificate of incorporation, except for the provision making it possible for our board of directors to issue undesignated preferred stock, requires approval by a stockholder vote by the holders of at least a 66 2/3% of the voting power of the then outstanding voting stock. 

The provisions of the Delaware General Corporation Law, our amended and restated certificate of incorporation and our amended and restated 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 our 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. 

Limitation on Liability and Indemnification 

Our amended and restated certificate of incorporation and our amended and restated bylaws limit our directors’ liability, contain provisions that provide that we may indemnify our directors and officers to the fullest extent permitted under the DGCL. The DGCL provides that directors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability for any: 

	
 
	
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transaction from which the director derives an improper personal benefit; 

 

 

	
 
		

	
 
	
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act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; 

	
 
	
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unlawful payment of dividends or redemption of shares; or 

	
 
	
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breach of a director’s duty of loyalty to the corporation or its stockholders. 

These limitations of liability do not apply to liabilities arising under federal securities laws and do not affect the availability of equitable remedies such as injunctive relief or recession. 

The DGCL and our amended and restated bylaws provide that we will, in certain situations, indemnify our directors and officers and may indemnify other employees and other agents, to the fullest extent permitted by law. Any indemnified person is also entitled, subject to certain limitations, to advancement, direct payment or reimbursement of reasonable expenses (including attorneys’ fees and disbursements) in advance of the final disposition of the proceeding. 

In addition, we have entered, and intend to continue to enter, into separate indemnification agreements with our directors and officers. These indemnification agreements, among other things, require us to indemnify our directors and officers for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by a director or officer in any action or proceeding arising out of their services as a director or officer, or any other company or enterprise to which the person provides services at our request. 

We also maintain a directors’ and officers’ insurance policy pursuant to which our directors and officers are insured against liability for actions taken in their capacities as directors and officers. 

We believe that these provisions in our amended and restated certificate of incorporation and amended and restated bylaws and these indemnification agreements are necessary to attract and retain qualified persons as directors and officers. 

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or control persons, in the opinion of the SEC, such indemnification is against public policy, as expressed in the Securities Act and is therefore unenforceable. 

Transfer Agent and Registrar 

The transfer agent and registrar for our common stock is Computershare, Inc. The transfer agent and registrar’s address is 462 South 4th Street, Louisville, Kentucky 40202.

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