Document:

etnb-ex43_8.htm

 

Exhibit 4.3

 

DESCRIPTION OF REGISTRANT’S SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934

The following description of our capital stock is intended as a summary only and therefore is not a complete description of our capital stock. This description is based upon, and is qualified by reference to, our second amended and restated certificate of incorporation (the “Amended Certificate”), our second amended and restated bylaws (the “Amended Bylaws”) and applicable provisions of Delaware corporate law. You should read our Amended Certificate and Amended Bylaws, which are filed as exhibits to our Annual Report on Form 10-K, to which this exhibit is also appended.

Our authorized capital stock consists of 100,000,000 shares of common stock and 10,000,000 shares of preferred stock. 

Common Stock

Our Amended Certificate authorizes the issuance of up to 100,000,000 shares of our common stock. All outstanding shares of our common stock are validly issued, fully paid and nonassessable.

The holders of our common stock are entitled to one vote per share on all matters submitted to a vote of stockholders. A majority vote of the shares present in person or represented by proxy and entitled to vote on the subject matter is required for the holders of our common stock to take action on all matters (except for election of directors (as discussed below)), except as otherwise required by law, our Amended Certificate or our Amended Bylaws. Our Amended Certificate does not provide for cumulative voting in the election of directors. The holders of our common stock will receive ratably any dividends declared by our board of directors out of funds legally available therefor. In the event of our liquidation, dissolution or winding-up, the holders of our common stock will be entitled to share ratably in all assets remaining after payment of or provision for any liabilities.

Preferred Stock

Under the terms of our Amended Certificate, our board of directors has the authority, without further action by our 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 dividend, voting and other 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 our 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 and may adversely affect the market price of our common stock and the voting and other rights of the holders of our common stock. 

 

Registration Rights

Certain holders of shares of our common stock are entitled to rights with respect to the registration of these securities under the Securities Act of 1933, as amended (the “Securities Act”). These rights are provided under the terms of our investors’ rights agreement, effective as of September 17, 2019 (the “IRA”). The IRA includes demand registration rights, short-form registration rights and piggyback registration rights. All fees, costs and expenses of underwritten registrations under this agreement will be borne by us and all selling expenses, including underwriting discounts and selling commissions, will be borne by the holders of the shares being registered.

Demand Registration Rights

 

 

Certain holders of shares of our common stock are entitled to demand registration rights. Under the terms of the IRA, we will be required, upon the written request of at least 50% of the holders of the registrable securities, including either OrbiMed Israel Partners II, L.P. or OrbiMed Private Investments VI, LP, provided that the anticipated aggregate offering price is at least $10 million, to file a registration statement on Form S-1 and use commercially reasonable efforts to effect the registration of these shares for public resale. The right to have such shares registered on Form S-1 is further subject to other specified conditions and limitations.

Piggyback Registration Rights

Pursuant to the IRA, if we register any of our common stock either for our own account or for the account of other security holders, the holders of registrable shares party to the IRA are entitled to include their shares in the registration, subject to certain marketing and other limitations. We may terminate or withdraw any registration initiated before the effective date of such registration in our sole discretion.

Form S-3 Registration Rights

Pursuant to the IRA, if we are eligible to file a registration statement on Form S-3, upon the written request of at least 10% of the holders of registrable securities to sell registrable securities at an aggregate price of at least $5 million, we will be required to use commercially reasonable efforts to effect a registration of such shares. The right to have such shares registered on Form S-3 is further subject to other specified conditions and limitations.

Anti-Takeover Effects of Our Amended Certificate, Amended Bylaws and Delaware Law

Our Amended Certificate and our Amended Bylaws include a number of provisions that may have the effect of delaying, deferring or preventing another party from acquiring control of us and encouraging persons considering unsolicited tender offers or other unilateral takeover proposals to negotiate with our board of directors rather than pursue non-negotiated takeover attempts.

	
 
	
•
	
Issuance of undesignated preferred stock: Under our Amended Certificate, our board of directors has the authority, without further action by the stockholders, to issue up to 10,000,000 shares of undesignated preferred stock with rights and preferences, including voting rights, designated from time to time by our board of directors. The existence of authorized but unissued shares of preferred stock enables our board of directors to make it more difficult to attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise.

	
 
	
•
	
Classified board: Our Amended Certificate establishes a classified board of directors consisting of three classes of directors, 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. This provision may have the effect of delaying a change in control of our board of directors.

	
 
	
•
	
Election and removal of directors and board vacancies: Our Amended Bylaws provide that directors will be elected by a plurality vote. Our Amended Certificate and Amended Bylaws also provide that our board of directors has the right to increase or decrease the size of the board and to fill vacancies on the board. Directors may be removed only for cause by the affirmative vote of the holders of at least 662⁄3% of the votes that all our stockholders would be entitled to cast in an annual election of directors. Only our board of directors is authorized to fill vacant directorships. In addition the number of directors constituting our board of directors may be set only by resolution adopted by a majority vote of the directors then in office. These provisions prevent stockholders from increasing the size of our board of directors and gaining control of our board of directors by filling the resulting vacancies with its own nominees.

2

 

	
 
	
•
	
Requirements for advance notification of stockholder nominations and proposals: Our Amended Bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors that specify certain requirements as to the timing, form and content of a stockholder’s notice. Business that may be conducted at an annual meeting of stockholders will be limited to those matters properly brought before the meeting. These provisions may make it more difficult for our stockholders to bring matters before our annual meeting of stockholders or to nominate directors at annual meetings of stockholders.

	
 
	
•
	
No written consent of stockholders: Our Amended Certificate provides that all stockholder actions be taken by a vote of the stockholders at an annual or special meeting, and that stockholders may not take any action by written consent in lieu of a meeting. This limit may lengthen the amount of time required to take stockholder actions and would prevent the amendment of our Amended Bylaws or removal of directors by our stockholders without holding a meeting of stockholders.

	
 
	
•
	
No stockholder ability to call special meetings: Our Amended Certificate and Amended Bylaws provide that only a majority of the members of our board of directors then in office may be able to call special meetings of stockholders and only those matters set forth in the notice of the special meeting may be considered or acted upon at a special meeting of stockholders.

	
 
	
•
	
Amendments to certificate of incorporation and bylaws: Any amendment to our Amended Certificate will be required to be approved by a majority of our board of directors as well as, if required by law or the Amended Certificate, a majority of the outstanding shares entitled to vote on the amendment and a majority of the outstanding shares of each class entitled to vote thereon as a class, except that the amendment of provisions to board classification, stockholder action, certificate amendments, and liability of directors must be approved by not less than 662⁄3% of the outstanding shares entitled to vote on the amendment, voting together as a single class. Any amendment to our Amended Bylaws must be approved by either a majority of our board of directors or not less than 662⁄3% of the outstanding shares entitled to vote on the amendment, voting together as a single class.

These provisions are designed to enhance the likelihood of continued stability in the composition of our board of directors and its policies, to discourage certain types of transactions that may involve an actual or threatened acquisition of us and to reduce our vulnerability to an unsolicited acquisition proposal. We also designed these provisions to discourage certain tactics that may be used in proxy fights. However, these provisions could have the effect of discouraging others from making tender offers for our shares and, as a consequence, they may also reduce fluctuations in the market price of our shares that could result from actual or rumored takeover attempts.

 

Section 203 of the Delaware General Corporation Law

We are subject to the provisions of Section 203 of the Delaware General Corporation Law. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a three-year period following the time that this stockholder becomes an interested stockholder, unless the business combination is approved in a prescribed manner.

Choice of Forum

Our Amended Certificate requires that the Court of Chancery of the State of Delaware be the exclusive forum for the following types of actions or proceedings under Delaware statutory or common law: (1) any derivative action or proceeding brought on our behalf; (2) any action asserting a breach of fiduciary duty owed by any director, officer or other employee to us or our stockholders; (3) any action asserting a claim against us or any director or officer or other employee arising pursuant to the Delaware General Corporation Law, our Amended Certificate or Amended Bylaws; or (4) any action asserting a claim against us or any director or officer or other employee that is governed by the internal affairs doctrine. This provision would not apply to claims brought to enforce a duty or liability created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts have exclusive jurisdiction. Our Amended Certificate provides further that the federal district courts of the United States will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act, subject to and contingent upon a final adjudication in the State of Delaware of the enforceability of such exclusive forum provision. Although we believe these provisions benefit us by providing increased consistency in the application of Delaware law for the specified types of actions and proceedings, the provisions may have the effect of discouraging lawsuits against us or our directors or officers.

3

 

Transfer Agent and Registrar

American Stock Transfer and Trust Company, LLC serves as the transfer agent and registrar for our common stock.

Listing

Our common stock is listed on The Nasdaq Global Market under the symbol “ETNB.”

4EX-10.1

 Exhibit 10.1 

Settlement Agreement 
 This Settlement
Agreement (the “Agreement”) is entered into as of March 23, 2022 by and among William C. Marsh (the “Executive”), Emclaire Financial Corp, a Pennsylvania-chartered bank holding company (“Bank”), and The Farmers
National Bank of Emlenton, a national banking association (collectively referred to as the “Company”). 
 WITNESSETH: 

WHEREAS, concurrently with the execution of this Agreement, Farmers National Banc Corp, an Ohio corporation (“Purchaser”), and FMNB Merger
Subsidiary V, LLC, an Ohio limited liability company and a wholly owned subsidiary of Purchaser, and Bank are entering into an Agreement and Plan of Merger, dated as of March 23, 2022 (the “Merger Agreement”), and all capitalized
terms not defined herein shall have the meaning set forth in the Merger Agreement; and 
 WHEREAS, Company and the Executive desire to enter into
this Agreement, which shall, except as expressly provided in Sections 2 and 4 below, supersede in its entirety the Amended and Restated Employment Agreement dated as of November 18, 2015 (the “Prior Agreement”), effective immediately
prior to the Effective Time of the Merger, and in lieu of any and all rights and payments and benefits under the Prior Agreement, the Executive shall be entitled to the rights and payments set forth herein. 

NOW THEREFORE, in consideration of the foregoing and other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged,
the Executive and the Company agree as follows: 
 1. Cancellation of Prior Agreement. Effective as of the business day immediately preceding the
Closing Date, and prior to the Effective Time, except as expressly provided in Sections 2 and 4 below, the Prior Agreement shall be cancelled in its entirety and the parties thereto shall have no further rights or obligations thereunder. In the
event that the Merger Agreement is terminated or otherwise cancelled, this Agreement will be null and void ab initio, and the Prior Agreement will remain in full force and effect in accordance with its terms. 

2. Settlement. Provided the Executive has remained employed with the Company to and including the business day immediately preceding the Closing Date,
Company shall pay Executive an amount equal to $1,844,122 (the “Settlement Award”), less required tax withholding, on the business day immediately preceding the Closing Date. Payment of the Settlement Award, and the Executive’s right
to receive the same, shall be conditioned on the Executive’s execution and delivery to the Company of a general release and expiration of the revocation period set forth in the release (in the form as attached to this Agreement as Exhibit A)
(the “Release”) on the business day immediately preceding the Closing Date. Contingent on the Executive’s timely execution and delivery of the Release, the Executive shall have a non-forfeitable
right to payment of the Settlement Award hereunder. 
 3. Complete Satisfaction. In consideration of the payment of the Settlement Award and
Executive’s execution of the Release attached hereto as Exhibit A, the Executive and the Company hereby agree that the full payment of the Settlement Award, in accordance with Section 2, shall be in complete satisfaction of all rights to
payments due to Executive under the Prior Agreement and any other agreement or broad based program available to employees of the Company, except as set forth in the following paragraph. 

  
 1 

 For the avoidance of doubt, the payment of the Settlement Award under this Agreement shall not release the
Company, as applicable, from any of the following obligations: (a) obligations to pay to the Executive accrued but unpaid wages and accrued but unpaid time off earned up to the Effective Time of the Merger to the extent required by applicable
law; (b) payment under any Company annual incentive plan with respect to calendar year 2022 under applicable performance metrics per the plan; (c) the payment of any of the Executive’s vested benefits under the tax-qualified plans of Company, including any benefits that become vested as a result of the Merger or the termination of such plans; (d) the acceleration and vesting of any Company Restricted Stock awards;
(e) future payments as vested under the Company’s Supplemental Executive Retirement Plan Agreement dated November 18, 2015, as amended and restated on February 8, 2019 (the “SERP”); (f) any vested rights the
Executive has under any of the Company’s welfare benefit plans with respect to claims incurred or benefits accrued prior to the Effective Time of the Merger; (g) the payment of the Merger Consideration with respect to the Company Common
Shares held by the Executive as contemplated by the Merger Agreement; or (h) rights to indemnification and advancement of expenses under applicable corporate law, the organizational documents of the Company, as an insured under any
director’s and officer’s liability insurance policy or pursuant to the Merger Agreement. 
 4. Survival of Restrictive Covenants.
Section 7 of the Prior Agreement shall survive the termination of the Prior Agreement and will remain in full force and effect and enforceable as to the Executive during the Restricted Period (as defined in the Prior Agreement). 

5. Code Section 409A Compliance. The intent of the parties is that payments under this Agreement either be exempt from or comply
with Section 409A of the Code and the Treasury Regulations and guidance promulgated thereunder and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. A termination of employment, as
used in this Agreement, shall mean a Separation from Service within the meaning of Section 409A of the Code. The parties agree that the Settlement Award described in Section 2 is intended to be excepted from compliance with
Section 409A of the Code as a short-term deferral pursuant to Treasury Regulation Section 1.409A-1(b)(4). 

6. General. 
 6.1 Heirs, Successors,
and Assigns. The terms of this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, successors, assigns and legal representatives, including, for the avoidance of doubt, Purchaser as the
successor of Company following the Bank Merger. 
 6.2 Final Agreement. This Agreement and the benefits described herein supersedes
and terminates the Prior Agreement and all prior understandings, written or oral, related thereto or arising thereunder. The terms of this Agreement may be changed, modified or discharged only by an instrument in writing signed by each of the
parties hereto. 
 6.3 Withholdings. Company may withhold from any amounts payable under this Agreement such federal, state or local
taxes as may be required to be withheld pursuant to applicable law or regulation. 

  
 2 

 6.4 Governing Law. This Agreement shall be construed, enforced and interpreted in
accordance with and governed by the laws of the State of Ohio, without reference to its principles of conflicts of law, except to the extent that federal law shall be deemed to preempt such state laws. 

6.5 Voluntary Action and Waiver. The Executive acknowledges that by his free and voluntary act of signing below, the Executive agrees
to all of the terms of this Agreement and intends to be legally bound thereby. The Executive acknowledges that he has been advised to consult with an attorney prior to executing this Agreement. 

6.6 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and all
of which together shall constitute one and the same instrument. 
 7. Effectiveness. Notwithstanding anything to the contrary contained herein, this
Agreement shall be subject to consummation of the Merger in accordance with the terms of the Merger Agreement, as the same may be amended by the parties thereto in accordance with its terms. In the event the Merger Agreement is terminated for any
reason or the Merger does not occur, this Agreement shall be deemed null and void. 

  
 3 

 IN WITNESS WHEREOF, Company has caused this Agreement to be executed by their duly authorized
officers, and the Executive has signed this Agreement, effective as of the date first written above. 
  

			
	EXECUTIVE:
	
	 /s/ William C. Marsh

	William C. Marsh
	
	FARMERS NATIONAL BANK OF EMLENTON:
		
	By:	 	 /s/ Amanda Engles

	Name:	 	Amanda Engles
	Title:	 	Chief Financial Officer
	
	EMCLAIRE FINANCIAL CORP.:
		
	By:	 	 /s/ Amanda Engles

	Name:	 	Amanda Engles
	Title:	 	Chief Financial Officer

  
 4 

 Exhibit A 

RELEASE 
 In exchange for the consideration
described in Section 2 of the Settlement Agreement (the “Settlement Agreement”) by and among William C. Marsh (the “Executive”) and Emclaire Financial Corp, a Pennsylvania-chartered bank holding company
(“Bank”) and The Farmers National Bank of Emlenton, a national banking association (collectively referred to as the “Company”), the Executive hereby agrees as follows: 

1. EXECUTIVE’S RELEASE. 
 (a)
Executive hereby forever releases and discharges the Company and its parents, affiliates, successors and assigns, as well as each of their respective past, present and future officers, directors, shareholders, members, managers, employees, agents
and representatives (collectively, the “Company Released Parties”), from any and all claims, charges, complaints, liens, demands, causes of action, obligations, damages and liabilities, known or unknown, suspected or unsuspected,
that Executive had, now has, or may hereafter claim to have against the Company Released Parties arising out of or relating in any way to Executive’s employment with, or resignation and termination from, the Company, from the beginning of time
to the date Executive signs this Release (the “Executive’s Release”). 
 (b) Executive’s Release specifically
extends to, without limitation, any and all claims or causes of action as an officer, employee or shareholder of the Company or for wrongful termination, breach of an express or implied contract, including, without limitation, the Prior Agreement
(as defined in the Settlement Agreement), interference with contractual relationships, breach of the covenant of good faith and fair dealing, breach of fiduciary duty, employment discrimination, including harassment, fraud, misrepresentation,
defamation, slander, infliction of emotional distress, disability, loss of future earnings, and any claims under any applicable state, federal or local statutes and regulations, including, but not limited to, the Civil Rights Act of 1964, as
amended, the Equal Pay Act of 1963, as amended, the Fair Labor Standards Act, as amended, the Americans with Disabilities Act of 1990, as amended (the “ADA”), the Rehabilitation Act of 1973, as amended, the Age Discrimination in
Employment Act, as amended (“ADEA”), the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Worker Adjustment and Retraining Notification Act, as amended (the “WARN Act”),
the Family and Medical Leave Act, or any other federal or state laws relating to employment or employment discrimination, and any claims for attorneys’ fees and costs; provided, however, that Executive’s Release does not
waive, release or otherwise discharge (i) any claim or cause of action that cannot legally be waived by private agreement between Executive and the Company, including, but not limited to, any claim for unpaid wages, workers’ compensation
benefits or unemployment benefits; (ii) any claims or rights the Executive has with respect to any of the items described in the second paragraph of Section 3 of the Settlement Agreement; and (iii) any claim or cause of action to
enforce any of Executive’s rights under the Settlement Agreement. 

  
 5 

 (c) Except as specified in Paragraph 1(b), this Release means that Executive will not bring
any claim whatsoever against the Company Released Parties arising out of or associated with Executive’s employment or the termination thereof, and this Release will bar any and all claims, causes of action, and obligations of any kind and
nature whatsoever, initiated by Executive, or in which Executive is otherwise named as a party, against the Company Released Parties. Pursuant to this Release, unless excepted in Paragraph 1(b), Executive promises that he will never institute any
claim or lawsuit whatsoever against the Company Released Parties for any reason arising out of his employment relationship or the termination thereof. The severance benefits provided under Section 2 of the Settlement Agreement are provided in
exchange for Executive’s release and promise not to institute any such claim against the Company Released Parties. 
 2. OLDER WORKERS’ BENEFIT
PROTECTION ACT WAIVER. The Executive has certain individual federal rights, which must be explicitly waived. Specifically, the Executive is protected by the ADEA from discrimination in employment because of the Executive’s age. By executing
this Release, the Executive waives these rights as to any past or current claims. Notwithstanding anything else in this Release, excluded from this Release are ADEA age claims that may arise after execution of this Release. In connection with the
releases and waivers in Paragraph 1(b) of any and all claims or disputes that the Executive has or may have on the date hereof, the Executive makes the following acknowledgements: 

 

	 	[1]	 By signing this Release, the Executive waives all claims against the Company Released Parties for
discrimination based on age, including without limitation, any claim which arises under or by reason of a violation of the ADEA. 

  

	 	[2]	 In consideration of the releases, waivers and covenants made by the Executive under this Release, the
Executive will be receiving the applicable payments and other benefits in the amounts and manner described in Section 2 of the Settlement Agreement. 

  

	 	[3]	 The Executive represents and acknowledges that the Executive has consulted with an attorney prior to
executing this Release and the Executive has been given a period of at least twenty-one (21) days within which to consider whether or not to enter into this Release. 

The Executive understands that this Release shall be effective as of the date on which the Executive signs the Release (“Effective
Date”), provided that the Release is not revoked by the Executive within seven days after the Executive signs the Release. For a period of seven days after the Executive signs the Release, the Executive has the right to revoke and/or cancel
this Release by the delivery of notice in writing of revocation and/or cancellation to Jennifer Poulsen, Human Resources Officer, at jpoulsen@farmersnb.com. In the event that the Executive does not revoke and/or cancel this Release during this
period, this Release shall become effective on the Effective Date. In the event that the Executive revokes this Release, the Executive shall not be entitled to any of the consideration set out in Section 2 of the Settlement Agreement. 

3. MISCELLANEOUS. Executive represents and warrants that he has the full legal capacity, power and authority to execute and deliver this Release and to
perform his obligations hereunder. This Release is binding upon and shall inure to the benefit of the parties hereto as well as the Company Released Parties. For purposes of this Release, a facsimile or electronic file containing Executive’s
signature printed by a receiving facsimile machine or printer shall be deemed an original signature. 

  
 6 

 
			
	Accepted and agreed as of the date set forth below:
	
	EXECUTIVE
	
	 William C. Marsh

		
	Date:	 	  

  
 7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00342-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00342-of-00352.parquet"}]]