Document:

urg_ex42.htm

EXHIBIT 4.2
  
 DESCRIPTION OF REGISTRANT’S SECURITIES 
 REGISTERED PURSUANT TO SECTION 12 
 OF THE SECURITIES ACT OF 1934
  
 The following is a description of each class of securities of Ur-Energy Inc. that is registered under Section 12 of the Securities and Exchange Act of 1934, as amended. For a complete description of the terms and provisions of such securities, refer to our Articles of Continuance and Articles of Amendment (“Articles”), our bylaws, as amended (“Bylaws”), and applicable provisions of the Canada Business Corporations Act. We have summarized certain portions of the Articles and Bylaws below. This summary is not complete. The Articles and Bylaws are incorporated by reference as exhibits to this Annual Report on Form 10-K. You should read the Articles and Bylaws in their entirety.
  
 Common Shares and Preference Shares
  
 Authorized Shares
  
 The authorized capital of Ur-Energy consists of an unlimited number of Common Shares and an unlimited number of Class A Preference Shares. Our Class A Preference Shares are issuable by the Ur‐Energy Inc. Board of Directors (“Board”) in one or more series and the Board has the right and obligation to fix the number of shares in, and determine the designation, rights, privileges, restrictions and conditions attaching to the shares of each series. The rights of the holders of Common Shares will be subject to, and may be adversely affected by, the rights of the holders of any Class A Preference Shares that may be issued in the future. The Class A Preference Shares, may, at the discretion of the Board, be entitled to a preference over the Common Shares and any other shares ranking junior to the Class A Preference Shares with respect to the payment of dividends and distribution of assets in the event of liquidation, dissolution or winding up.
  
 Dividend Rights
  
 Holders of our Common Shares will be entitled to receive dividends when, as and if declared by our Board, out of funds legally available for their payment, subject to the rights of holders of any preferred shares that we may issue.
  
 Voting Rights
  
 Holders of our Common Shares are entitled to one vote per share in all matters as to which holders of Common Shares are entitled to vote. The presence, in person or by proxy, of two shareholders holding not less than 10% of our Common Shares entitled to vote as of the record date for a meeting constitutes a quorum for the transaction of business at a meeting.
  
 Election of Directors
  
 Our directors are elected by a plurality of the votes cast by the holders of our Common Shares in a meeting of shareholders at which a quorum is present. “Plurality” means that the individuals who receive the largest number of votes cast are elected as directors, up to the maximum number of directors to be chosen at the meeting. The Company has adopted a majority voting policy pursuant to which any director who fails to receive a majority of the votes cast will be required to tender his resignation. The Company has also adopted an advance notice by-law.
  
 Liquidation
  
 In the event of any liquidation, dissolution or winding up of Ur-Energy or other distribution of assets of the Company among its shareholders for the purpose of winding up its affairs, the shareholders of the Common Shares shall be entitled, subject to the rights of the holders of any other class ranking in priority to the Common Shares, to receive the remaining assets or property of the company ratably on a per share basis with out preference or distinction.
  
 	 
	
	

	 

  
 Redemption
  
 Our Common Shares are not redeemable or convertible.
  
 Preemptive Rights
  
 Holders of our Common Shares are not entitled to preemptive rights in connection with any future issuance of Common Shares.
  
 Warrants
  
 August 2020 
  
 In August 2020, we issued 9,000,000 warrants as part of a registered direct offering with two warrants redeemable for one Common Share of the Company’s stock at a price of $0.75 per full share. The warrants were issued as an individual warrant certificate with each investor. The warrants are exercisable at any time after their original issuance and at any time up to August 4, 2022. The warrants will be exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice and by payment in full in immediately available funds for the number of common shares purchased upon such exercise. In the event the registration statement permitting the registered issuance of the warrant shares is not then effective or the prospectus forming a part thereof is not then available, then the holder of the warrants may, in its sole discretion, elect to exercise the warrant through a net share exercise, in which case the holder would receive upon such exercise the net number of common shares determined according to the formula set forth in the warrant. No fractional common shares will be issued in connection with the exercise of a warrant. In lieu of fractional shares, we will pay the holder an amount in cash equal to the fair market value of the fractional share, calculated based on the trading price of our common shares. The exercise price of the warrants is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting our common shares and also upon any distributions of assets, including cash, stock or other property to our shareholders. A holder will not have the right to exercise any portion of the warrant if the holder (together with its affiliates) would beneficially own in excess of 4.99% of the number of shares of our common shares outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the warrants. However, any holder may increase or decrease such percentage to any other percentage upon at least 61 days’ prior notice from the holder to us. We do not plan on applying to list the warrants on the NYSE American, TSX or any other national securities exchange or automated quotation system.
  
 February 2021
  
 On February 4, 2021, we entered into a warrant agreement with Computershare Trust Company, N.A. (the “2021 Warrant Agreement”). Pursuant to the 2021 Warrant Agreement, the warrants may be exercised at any time on or after the date of issuance and will expire on February 5, 2024. The warrants contain provisions that prohibit exercise if the holder, together with any affiliates, would beneficially own in excess of 4.99%, or 9.99% upon notice by the holder or automatically if such holder already beneficially owns in excess of 4.99%, of the number of Common Shares outstanding immediately after giving effect to such exercise. The holder of the warrants may increase or decrease this percentage by providing at least 61 days prior notice from the holder to us. In the event of certain corporate transactions, the holders of the warrants will be entitled to receive, upon exercise of the warrants, the kind and amount of securities, cash or other property that the holders would have received had they exercised the warrants immediately prior to such transaction. The warrants do not contain voting rights or any of the other rights or privileges as a holder of our Common Shares. There is no established trading market for the warrants and we do not expect a market to develop. In addition, we do not intend to apply for the listing of the warrants on any national securities exchange or other trading market.
  
 	 
	
	

	 

  
 Anti-Takeover Effects of our Articles and Bylaws
  
 Our Articles and Bylaws contain provisions that may delay, defer or discourage another party from acquiring control of us. We expect that these provisions, some of which are summarized below, will discourage coercive takeover practices or inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with the Board, which we believe may result in an improvement of the terms of any such acquisition in favor of our shareholders. However, they also give the Board the power to discourage acquisitions that some shareholders may favor.
  
 Advance Notice Requirements for Shareholder Proposals. Our 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 or a committee of the Board.
  
 Undesignated Preference Shares. The authorization of undesignated, or “blank check,” preference shares will make it possible for our Board to issue preference shares with voting or other rights or preferences that could impede the success of any attempt to change control of our Company.dzsi-ex41_8.htm

Exhibit 4.1

 

DESCRIPTION OF THE REGISTRANT’S SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF THE

SECURITIES EXCHANGE ACT OF 1934

The following summary of the material terms of the common stock of DZS Inc. (the “Company”) summarizes the material terms of, is subject to and qualified in its entirety by reference to the terms and provisions of our restated certificate of incorporation, as amended (the “Charter”), and our amended and restated bylaws (the “Bylaws”). For the complete terms of our common stock, please refer to the Charter and the Bylaws, each as may be amended from time to time. Our common stock is the only class of securities of the Company that is registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended. 

General

We have authorized 61,000,000 shares of capital stock, of which 36,000,000 are shares of common stock, par value $0.001 per share, and 25,000,000 are shares of preferred stock, par value $0.001 per share. As of March 4, 2022, there were 27,553,992 shares of common stock issued and outstanding and no shares of preferred stock issued and outstanding. The rights, preferences and privileges of holders of common stock are subject to the rights of the holders of any series of preferred stock that we may designate and issue in the future. Our common stock is listed on the NASDAQ Capital Market under the symbol “DZSI”.

Board of Directors

The Board of Directors is divided into three classes of directors that are as nearly equal as possible, with no class having less than one director. Directors are elected for three-year terms with a different classes’ term expiring at each annual meeting. Directors continue to hold office until their respective successors are elected and qualified. 

Dividends

We have never paid or declared any cash dividends on our common stock and do not anticipate paying cash dividends in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of the Board of Directors, subject to any applicable restrictions under our debt and credit agreements, and will be dependent upon our financial condition, results of operations, capital requirements, general business condition and such other factors as the Board of Directors may deem relevant.

In the event the Board of Directors does issue a dividend, subject to the rights of the holders of any preferred stock, holders of our common stock are entitled to receive equally, on a per share basis, such dividends and other distributions in cash, securities or other property of the Company as may be declared by the Board of Directors. 

Voting Rights

Except as otherwise required by law or by the Charter, each holder of common stock is entitled to cast one vote for each share of common stock standing in such holder’s name on the stock transfer records of the Company.  A quorum of stockholders is necessary to hold a valid meeting of stockholders. The presence, in person or by proxy, of the holders of a majority of the issued and outstanding common stock entitled to vote at such meeting, is necessary to constitute a quorum at such meeting. Directors are elected by a plurality of votes.

 

 

For all other matters presented to stockholders, unless otherwise required by applicable law, the Bylaws or the Charter, a majority of the voting power of the issued and outstanding stock of the Company entitled to vote thereon, present and voting, in person or represented by proxy, shall decide the matter. Certain amendments to the Charter require 66-2/3% approval of the voting power of the Company that would be entitled to vote in the election of directors (i.e., Articles V (Board of Directors), VI (Limitation of Liability), VII (Indemnification), VIII (Stockholder Action) and IX (Amendment).  The Bylaws may be amended by a majority vote of the Board of Directors or by 66-2/3% of the voting power of all shares of the Company entitled to vote generally in the election of directors, voting as a single class.

No Preemptive or Similar Rights

Our common stock is not entitled to preemptive rights and is not subject to conversion, redemption or sinking fund provisions. 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 any series of our preferred stock that we may designate and issue in the future.

Liquidation and Distribution

Upon the liquidation, dissolution or winding up of the Company, the holders of common stock are entitled to ratably receive our net assets remaining for distribution after the payment of all debts and other liabilities and subject to the prior rights of any outstanding preferred stock.

Preferred Stock

The Board of Directors is authorized to, subject to any limitations imposed by applicable law, provide for issuances of preferred stock. The Board of Directors is further authorized to fix the voting powers, designations, powers, preferences and other rights of each series of preferred stock.  The number of authorized shares of preferred stock may only be increased or decreased by the affirmative vote of the holders of a majority in voting power of the Company entitled to vote, without the separate vote of the holders of preferred stock as a class.

Transfer Agent and Registrar

Our transfer agent and registrar for our capital stock is Computershare Trust Company, N.A. The transfer agent’s address is P.O. Box 505000, Louisville, KY 40233, and its telephone number is (800) 942-5909.

ANTI-TAKEOVER PROVISIONS OF THE CHARTER AND THE BYLAWS

General

The Charter and the Bylaws contain certain provisions that could have an effect of delaying, deferring or preventing a change in control of the Company in the event of a merger, reorganization, sale or transfer of substantially all of the Company’s assets, or some other extraordinary corporate transaction involving the Company. Set forth below is a description of such provisions. The description is intended as a summary only and is qualified in its entirety by reference to the Delaware General Corporation Law (the “DGCL”), the Charter and the Bylaws.

 

 

Advance Notice Requirements for Stockholder Proposals and Director Nominations

The Bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of stockholders, including proposed nominations of persons for election to the Board of Directors. Stockholders at an annual meeting may only consider proposals or nominations specified in the notice of meeting or brought before the meeting, by or at the direction of the Board of Directors or by a stockholder of record on the date of a stockholder’s notice and on the record date for the determination of stockholders entitled to vote on the annual meeting, who is entitled to vote at the meeting and who has delivered timely written notice in proper form to the Secretary of the Company.

Choice of Forum

The Charter provides that the Court of Chancery of the State of Delaware is the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or agent of the Company to the Company or the Company’s stockholders, (iii) any action asserting a claim against the Company arising pursuant to any provision of the DGCL, the Charter or the Bylaws, or (iv) any action asserting a claim against the Company governed by the internal affairs doctrine, in each such case subject to the Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein. 

Delaware Anti-takeover Law

The Company is subject to Section 203 of the DGCL (“Section 203”), an anti-takeover law. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a business combination with an interested stockholder for a period of three years following the date such person became an interested stockholder, unless the business combination or the transaction in which such person became an interested stockholder is approved in a prescribed manner. Generally, a “business combination” includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. Generally, an “interested stockholder” is a person that, 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.

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