Document:

Exhibit

Exhibit 10.2

SUPPORT AGREEMENT

THIS SUPPORT AGREEMENT (this “Agreement”) is made and entered into as of February __, 2020 by and between SYNACOR, INC., a Delaware corporation (“Synacor”), and the undersigned shareholder (“Shareholder”) of Qumu Corporation, a Minnesota corporation (“Qumu”).  Capitalized terms that are used but not defined herein shall have the respective meanings ascribed thereto in the Merger Agreement (defined below). 
W I T N E S S E T H

WHEREAS, as an inducement for Synacor to enter into that certain Agreement and Plan of Merger and Reorganization of even date herewith by and among Synacor, Quantum Merger Sub I, Inc., a Minnesota corporation and wholly owned subsidiary of Synacor (“Merger Sub”), and Qumu (as it may be amended from time to time by the parties thereto, the “Merger Agreement”), which provides for the merger of Merger Sub with and into Qumu in accordance with its terms (the “Merger”), Synacor has requested that Shareholder execute and deliver this Agreement. 
WHEREAS, pursuant to the Merger, each share of Qumu Common Stock that is outstanding immediately prior to the Effective Time will be canceled and extinguished and automatically converted into the right to receive the consideration set forth in the Merger Agreement, all upon the terms and subject to the conditions set forth in the Merger Agreement.
WHEREAS, as of the date hereof, Shareholder is the beneficial owner (as defined in Rule 13d-3(a) promulgated under the Exchange Act) of the number of shares of Qumu Common Stock and other securities convertible into, or exercisable or exchangeable for, shares of Qumu Common Stock, all as set forth on the signature page of this Agreement (collectively, the “Shares”).
WHEREAS, the form of this Support Agreement has been duly and validly approved by both the Qumu Board and a committee of disinterested directors of the Qumu Board formed in accordance with Section 302A.673 of the MBCA.
WHEREAS, as a condition and inducement for Synacor to enter into the Merger Agreement, Shareholder and Synacor are entering into this Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1.Agreement to Vote Shares.
(a)    Until the Expiration Date, at the Qumu Shareholder Meeting and at every other shareholder meeting of Qumu called to consider the Qumu Voting Proposal, and at every postponement or adjournment thereof, and on every action proposed to be approved by written consent of Qumu Shareholders with respect to any of the following, Shareholder shall vote all outstanding Shares and any outstanding New Shares (as defined in Section 4 hereof), to the extent 

(in the case of securities convertible into, or exercisable or exchangeable for, shares of Qumu Common Stock) any such Shares and New Shares are capable of being voted: 
(i)    in favor of the adoption of the Merger Agreement and any proposal to adjourn or postpone any meeting of the shareholders of Qumu at which the adoption of the Merger Agreement is submitted for the consideration and vote of the shareholders of Qumu to a later date if there are not proxies representing a sufficient number of shares of Qumu Common Stock to approve such matters on the date on which the meeting is held;
(ii)    against any Acquisition Proposal made by any Person (other than Synacor) and any Acquisition Transaction proposed by any Person (other than Synacor); and
(iii)    against any other action, agreement or transaction involving Qumu or any of the Qumu Subsidiaries that is intended, or would reasonably be expected, to impede, interfere with, delay, postpone, adversely affect or prevent the consummation of the Merger or the other transactions contemplated by the Merger Agreement. 
(b)    Prior to the Expiration Date, Shareholder shall not enter into any agreement or understanding with any person to vote or give instructions in any manner inconsistent with this Section 1.
(c)    Notwithstanding anything to the contrary set forth herein, if Shareholder is a director or officer of Synacor, nothing in this Agreement shall prohibit or otherwise impair the right or ability of Shareholder to exercise his or her fiduciary duties in his or her capacity as a director or officer of Qumu, including by voting in his or her capacity as a director to effect a Qumu Board Recommendation Change, in each case, in accordance with the terms of the Merger Agreement.
2.    Transfer and Encumbrance.  Shareholder agrees, during the period beginning on the date hereof and ending on the Expiration Date (as defined below), not to sell, transfer, exchange, pledge or otherwise dispose of or encumber (collectively, “Transfer”) any Shares or any New Shares, in each case without the prior written consent of Synacor; provided, that nothing contained herein shall prohibit (a) the net settlement of Shareholder’s options to purchase shares of Qumu Common Stock (to pay the exercise price thereof and any tax withholding obligations), (b) the net settlement of Shareholder’s restricted stock units (including performance-based restricted stock units) settled in shares of Qumu Common Stock (to pay any tax withholding obligations), (c) the exercise of Shareholder’s options to purchase shares of Qumu Common Stock, to the extent such options would expire prior to the Effective Time, (d) the exercise of Shareholder’s options to purchase shares of Qumu Common Stock or the receipt upon settlement of Shareholder’s restricted stock units, and the sale of a sufficient number of such shares of Qumu Common Stock acquired upon exercise of such options or settlement of such restricted stock units as would generate sales proceeds sufficient to pay the aggregate applicable exercise price of shares then exercised under such options and the taxes payable by Shareholder as a result of such exercise or settlement, (e) such Shareholder from selling Shares under any written plan providing for the trading of Shares in accordance with Rule 10b5-1 under the Exchange Act (a “10b5-1 Plan”) that is described on the signature page hereto or which is put in place after the date hereof in order to replace an expired or expiring 10b5-1 Plan 

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(provided, that any such 10b5-1 Plan shall be implemented in accordance with the requirements of Qumu’s insider trading policy and on substantially consistent terms as the expired or expiring 10b5-1 Plan, except as may be required to implement additional sales pursuant to the foregoing clause (d)), (f) any Transfer where such Shareholder retains sole direct and indirect voting control over such Shares or New Shares through the term of this Agreement, (g) any Transfer to an Affiliate of Shareholder, or (h) if Shareholder is an individual, (i) to any member of Shareholder’s immediate family or to a trust for the benefit of Shareholder or any member of Shareholder’s immediate family or (ii) to any person or entity if and to the extent required by any non-consensual legal order, by divorce decree or by will, intestacy or other similar law; provided, however, that in the case of the foregoing clauses (g) or (h)(i), any such Transfer shall only be permitted if and to the extent that the transferee of such Shares or New Shares agrees to be bound by and subject to the terms and provisions hereof to the same effect as the transferring Shareholder.  Shareholder acknowledges that the intent of the foregoing sentence is to ensure that the Shares and any New Shares are voted in accordance with the terms hereof. 
3.    No Participation in Litigation.  Shareholder hereby agrees not to commence or participate in, and use reasonable best efforts to, if requested by Synacor, take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against Synacor, Merger Sub, Qumu or any of their respective successors relating to the negotiation, execution or delivery of this Agreement or the Merger Agreement or the consummation of the Merger, including any claim (a) challenging the validity, or seeking to enjoin the operation, of any provision of this Agreement or the Merger Agreement or (b) alleging a breach of any fiduciary duty of the Qumu Board in connection with the Merger Agreement or the transactions contemplated thereby; provided, however, that the foregoing shall not restrict Shareholder from enforcing any of his, her or its rights under the Merger Agreement or this Agreement.
4.    New Shares.  Shareholder agrees that any shares of Qumu Common Stock that Shareholder purchases or with respect to which Shareholder otherwise acquires beneficial ownership after the date of this Agreement and prior to the Expiration Date, including, without limitation, shares issued or issuable upon the conversion, exercise or exchange, as the case may be, of all securities held by Shareholder that are convertible into, or exercisable or exchangeable for, shares of Qumu Common Stock (“New Shares”), shall be subject to the terms and conditions of this Agreement to the same extent as if they constituted Shares.
5.    No Obligation to Exercise Options or Other Securities.  Nothing contained in this Agreement shall require Shareholder to (i) convert, exercise or exchange any option, warrants or convertible securities in order to obtain any underlying shares of Qumu Common Stock or (ii) vote, or execute any consent with respect to, any shares of Qumu Common Stock underlying such options, warrants or convertible securities that have not yet been issued as of the applicable record date for that vote or consent.
6.    Representations and Warranties of Shareholder.  Shareholder hereby represents, warrants and covenants to Synacor as follows:
(a)    If such Shareholder is not an individual, the execution, delivery and performance by such Shareholder of this Agreement and the consummation by such Shareholder 

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of the transactions contemplated hereby are within the powers of such Shareholder and have been duly authorized by all necessary action.  If such Shareholder is an individual, he or she has full legal capacity, right and authority to execute and deliver this Agreement and to perform his or her obligations hereunder.  Such Shareholder has duly executed and delivered this Agreement and, assuming the due authorization, execution and delivery by Synacor, this Agreement constitutes such Shareholder’s legal, valid and binding obligation, enforceable against it in accordance with its terms except, in each case, as enforcement may be limited by bankruptcy, insolvency, reorganization or similar Legal Requirements affecting creditors’ rights generally and by general principles of equity.  If such Shareholder is married and any of the Shares or New Shares constitute community property or spousal approval is otherwise necessary for this Agreement to be legal, valid, binding and enforceable, this Agreement has been duly executed and delivered by, and, assuming the due authorization, execution and delivery by Synacor, constitutes the legal, valid and binding obligation of, such Shareholder’s spouse, enforceable in accordance with its terms except, in each case, as enforcement may be limited by bankruptcy, insolvency, reorganization or similar Legal Requirements affecting creditors’ rights generally and by general principles of equity. 
(b)    The Shares are and the New Shares will be beneficially owned (as defined in Rule 13d-3(a) promulgated under the Exchange Act) and owned of record by such Shareholder.  Such Shareholder has and will have good and valid title to such Shares and New Shares, free and clear of any encumbrances other than pursuant to this Agreement or applicable community property laws.  As of the date hereof, such Shareholder’s Shares constitute all of the shares of Qumu Common Stock beneficially owned or owned of record by such Shareholder.  Except as provided for herein, such Shareholder has sole voting power (including the right to control such vote as contemplated herein), sole power of disposition (except with respect to Shares underlying restricted stock awards issued to directors of Qumu), sole power to issue instructions with respect to the matters set forth in herein, and sole power to agree to all of the matters set forth in this Agreement, in each case with respect to all of such Shareholder’s Shares and New Shares.
(c)    The execution and delivery of this Agreement by such Shareholder do not, and the performance by such Shareholder of its obligations under this Agreement will not, (i) if such Shareholder is not an individual, violate the certificate of formation, agreement of limited partnership, certificate of incorporation or similar organizational documents of such Shareholder, (ii) conflict with or violate any law, ordinance or regulation of any Governmental Authority applicable to such Shareholder or by which any of its assets or properties is bound, or (iii) conflict with, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of any encumbrance on the properties or assets of such Shareholder pursuant to, any note, bond, mortgage, indenture, Contract, agreement, lease, license, permit, franchise or other instrument or obligation to which such Shareholder is a party or by which such Shareholder and/or any of its assets or properties is bound, except for any of the foregoing as would not reasonably be expected, either individually or in the aggregate, to impair the ability of such Shareholder to perform its obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.

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(d)    The execution and delivery of this Agreement by such Shareholder do not, and the performance by such Shareholder of its obligations under this Agreement and the consummation by it of the transactions contemplated hereby will not, require such Shareholder to obtain any consent, approval, authorization or permit of, or to make any filing with or notification to, any Governmental Authority, other than the filings of any reports with the SEC.
(e)    As of the date hereof, there is no Legal Proceeding pending or, to the knowledge of such Shareholder, threatened against or affecting such Shareholder and/or any of its Affiliates before or by any Governmental Authority that would reasonably be expected to impair the ability of such Shareholder to perform its obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.
(f)    No investment banker, broker, finder or other intermediary is entitled to a fee or commission from Synacor or Qumu in respect of this Agreement based upon any arrangement or agreement made by or on behalf of such Shareholder (other than as an officer or director of Qumu).
(g)    Such Shareholder understands and acknowledges that Synacor is entering into the Merger Agreement in reliance upon the execution and delivery of this Agreement by such Shareholder and the representations, warranties and covenants of such Shareholder contained herein.  Such Shareholder understands and acknowledges that the Merger Agreement governs the terms of the Merger and the other transactions contemplated thereby.
7.    Additional Documents.  Shareholder hereby covenants and agrees to execute and deliver any additional documents reasonably necessary or desirable to carry out the purpose and intent of this Agreement and the Merger Agreement.
8.    Consents and Waivers.  Shareholder hereby gives any consents or waivers that are reasonably required for the consummation of the Merger under the terms of any agreement to which Shareholder is a party or pursuant to any rights Shareholder may have.
9.    Termination.  This Agreement shall terminate and shall have no further force or effect as of the earlier to occur of (i) receipt of the Requisite Qumu Shareholder Approval and (ii) the date the Merger Agreement shall have been validly terminated pursuant to Article IX thereof (the “Expiration Date”); provided, however, that notwithstanding the foregoing, the provisions in Section 10 hereof shall survive in full force and effect following the consummation of the Merger.
10.    Miscellaneous.
(a)    Notices.  All notices and other communications hereunder shall be in writing and shall be deemed duly given (i) on the date of delivery if delivered personally, (ii) on the date of confirmation of receipt (or, the first business day following such receipt if the date is not a business day) of transmission by telecopy or telefacsimile, or (iii) on the date of confirmation of receipt (or, the first business day following such receipt if the date is not a business day) if delivered by a nationally recognized courier service.  All notices hereunder shall be delivered as set forth below, 

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or pursuant to such other instructions as may be designated in writing by the party to receive such notice:
(i)    If to Synacor, to: 
Synacor, Inc.
40 La Riviere Drive, Suite 300
Buffalo, New York 14202
Attention: Legal Department
E-mail: legaldept@synacor.com
With a copy (which shall not constitute notice) to:
Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP
220 West 42nd Street
17th Floor
New York, NY 10036
Attention: Brian Hutchings and Andrew Luh
Facsimile No.: (877) 881-3007
E-mail: bhutchings@gunder.com
aluh@gunder.com

(ii)    If to Shareholder, to the address set forth on the signature page hereto. 
(b)    Certain Interpretations. 
(i)    The words “include,” “includes” and “including” when used herein shall be deemed in each case to be followed by the words “without limitation.” 
(ii)    The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
(c)    Entire Agreement.  This Agreement and the documents and instruments and other agreements among the parties hereto referenced herein: (i) constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements, understandings, representations and conditions, both written and oral, among the parties with respect to the subject matter hereof, and (ii) are not intended to confer upon any other person any rights or remedies hereunder.
(d)    Assignment.  This Agreement shall not be assigned by operation of law or otherwise, except that Synacor may assign the rights and delegate its obligations hereunder to its affiliates so long as Synacor remains obligated to perform those obligations required to be performed by Synacor hereunder.

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(e)    Amendments and Modification.  This Agreement may not be modified, amended, altered or supplemented except by the execution and delivery of a written agreement executed by the parties hereto.
(f)    Waiver.  No waiver by any party hereto of any condition or of any breach of any provision of this Agreement shall be effective unless in writing.  
(g)    Severability.  In the event that any provision of this Agreement or the application thereof becomes or is declared by a court of competent jurisdiction to be illegal, void or unenforceable, the remainder of this Agreement will continue in full force and effect and the application of such provision to other persons or circumstances will be interpreted so as reasonably to effect the intent of the parties hereto.  The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such void or unenforceable provision.
(h)    Specific Performance and Other Remedies.
(i)    Specific Performance.  The parties shall be entitled to seek an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any court of the United States or any state having jurisdiction (without the necessity of posting a bond or other security), this being in addition to any other remedy to which they are entitled at law or in equity.
(ii)    Other Remedies.  Any and all remedies herein expressly conferred upon a party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by law or equity upon such party, and the exercise by a party of any one remedy will not preclude the exercise of any other remedy.  The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.
(i)    Fees and Expenses. 
(i)    Except as otherwise provided in the Merger Agreement, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be borne by the party incurring such expenses.
(ii)    If any action or other proceeding relating to the enforcement of any provision of this Agreement is brought by any party hereto, the prevailing party shall be entitled to recover reasonable attorneys’ fees, costs and disbursements from the opposing party or parties in such action or other preceding (in addition to any other relief to which the prevailing party may be entitled).
(j)    GOVERNING LAW.  EXCEPT TO THE EXTENT THE LAWS OF THE STATE OF MINNESOTA ARE MANDATORILY APPLICABLE TO THIS AGREEMENT IN WHICH CASE MINNESOTA LAW SHALL GOVERN, ALL QUESTIONS AND/OR DISPUTES 

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CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY THE INTERNAL LAWS, AND NOT THE LAW OF CONFLICTS, OF THE STATE OF DELAWARE.  EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES TO BE SUBJECT TO, AND HEREBY CONSENTS AND SUBMITS TO, THE JURISDICTION OF THE COURTS OF THE STATE OF DELAWARE AND AGREES THAT ANY ACTION INVOLVING ANY EQUITABLE OR OTHER CLAIM SHALL BE BROUGHT EXCLUSIVELY IN THE DELAWARE COURT OF CHANCERY.  IN THE EVENT THAT THE DELAWARE COURT OF CHANCERY DOES NOT ACCEPT OR DOES NOT HAVE JURISDICTION OVER ANY SUCH ACTION, EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ANY SUCH ACTION THEN SHALL BE BROUGHT EXCLUSIVELY IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE.
(k)    WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF ANY PARTY HERETO IN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.
(l)    Counterparts.  This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party, it being understood that all parties need not sign the same counterpart.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the undersigned have executed this Agreement on the date first above written. 
	
					
	 
	SYNACOR, INC. 
	 
	 
	SHAREHOLDER 

	By:
	 
	 
	 
	 

	 
	Name:     Himesh Bhise    
	 
	 
	Print Shareholders Name

	 
	Title: Chief Executive Officer
	 
	 
	 

	 
	 
	 
	By:
	 

	 
	 
	 
	 
	Signature

	 
	 
	 
	 
	 

	 
	 
	 
	Address:
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	Qumu Capital Stock Beneficially Owned:

	 
	 
	 
	Common Stock:
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	Common Stock issuable upon the exercise or settlement of outstanding options, warrants, restricted stock units or other rights:

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	Description of any applicable 10b5-1 Plan:

	 
	 
	 
	 
	 

[Signature Page to Support Agreement]Exhibit

EXHIBIT 4.1

DESCRIPTION OF THE REGISTRANT'S SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934
The following is a description of the common stock, par value $0.001 per share, of Varonis Systems, Inc. (the “Company,” “we” or “us”) registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). This description is a summary and is qualified in its entirety by reference to the amended and restated certificate of incorporation and amended and restated bylaws, copies of which are filed as Exhibit 3.1 and 3.2, respectively, to the Annual Report on Form 10-K of the Company for the fiscal year ended December 31, 2019 (the “2019 Annual Report”). We refer in this exhibit to our amended and restated certificate of incorporation as our certificate of incorporation, and we refer to our amended and restated bylaws as our bylaws. 
General
Our authorized capital stock consists of 200 million shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share, all of which shares of preferred stock are undesignated.
As of December 31, 2019, 30,583,311 shares of our common stock were outstanding, and no shares of preferred stock were outstanding. 
Common Stock
Voting Rights. The holders of our common stock are entitled to one vote for each share held on all matters properly submitted to a vote of the stockholders. The holders of our common stock do not have any cumulative voting rights. Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. All other matters, unless otherwise provided by applicable law, the rules or regulations of any stock exchange applicable to the Company, the certificate of incorporation or the bylaws (as disclosed herein), shall be decided by the affirmative vote of the holders of a majority of the voting power of the shares of stock entitled to vote thereon, regardless of whether such holders actually vote their shares on such matter or abstain from doing so.
Dividend Rights and Liquidation Rights. Holders of our common stock are entitled to receive ratably any dividends declared by the board of directors out of funds legally available for that purpose, subject to any preferential dividend rights of any outstanding preferred stock. In the event of our liquidation, dissolution or winding up, holders of our common stock will be entitled to share ratably in all assets remaining after payment of all debts and other liabilities and any liquidation preference of any outstanding preferred stock. 
Other Rights and Preferences. Our common stock has no preemptive rights, conversion rights or other subscription rights or redemption or sinking fund provisions. The outstanding shares are validly issued, fully paid and non-assessable. The rights and privileges of holders of our common stock are subject to any series of preferred stock that we may issue, as described below.
Preferred Stock
Our board of directors is authorized, subject to any limitations prescribed by law, without stockholder approval, to issue from time to time up to an aggregate of 5,000,000 shares of preferred stock, in one or more series, each series to have such rights and preferences, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences as our board of directors determines. The rights of the holders of common stock will be subject to, and may be adversely affected by, the rights of holders of any preferred stock that may be issued in the future. As of the date of the filing of the 2019 Annual Report, we had no shares of preferred stock outstanding. 
Anti-Takeover Effects of our Certificate of Incorporation and Bylaws and Delaware Law
Our certificate of incorporation and 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. These provisions include the items described below.
Board Composition and Filling Vacancies. Our certificate of incorporation provides for the division of our board of directors into three classes serving staggered three-year terms, with one class being elected each year. Our certificate of incorporation also provides that directors may be removed only for cause and then only by the affirmative vote of the holders of 75% or more of the shares then entitled to vote at an election of directors. Furthermore, any vacancy on our board of directors, however occurring, including a vacancy resulting from an increase in the size of our board, may only be filled by the affirmative vote of a majority of our directors then in office even if less than a quorum, unless otherwise determined by our board to be filled by stockholders. The classification of directors, together with the limitations on removal of directors and treatment of vacancies, has the effect of making it more difficult for stockholders to change the composition of our board of directors.
No Written Consent of Stockholders. Our certificate of incorporation provides that all stockholder actions are required to 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 bylaws or removal of directors by our stockholders without holding a meeting of stockholders.
Meetings of Stockholders. Our certificate of incorporation and bylaws provide that only the chairperson of our board, the lead independent director, if any, the chief executive offer, the president or a majority of the total authorized number of directors may 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. Our bylaws limit the business that may be conducted at an annual meeting of stockholders to those matters properly brought before the meeting.
Advance Notice Requirements. Our bylaws establish advance notice procedures with regard to stockholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of our stockholders. These procedures provide that notice of stockholder proposals must be timely given in writing to our corporate secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at our principal executive offices not less than 75 days nor more than 105 days prior to the first anniversary date of the annual meeting for the preceding year. Our bylaws specify the requirements as to form and content of all stockholders’ notices. These requirements may preclude stockholders from bringing matters before the stockholders at an annual or special meeting.
Amendment to Certificate of Incorporation and Bylaws. Any amendment of our certificate of incorporation must first be approved by a majority of our board of directors, and if required by law or our certificate of incorporation, must thereafter be approved by a majority of the outstanding shares entitled to vote on the amendment and, if applicable, by a majority of the outstanding shares of each class entitled to vote thereon as a class, except that the amendment of the provisions relating to stockholder action, the requirements for the amendment of our bylaws, board composition (including size, classification, term, removal and vacancies), director liability and indemnification and the requirements for the amendment of our certificate of incorporation must be approved by not less than 75% of the outstanding shares entitled to vote on the amendment voting together as a single class. 
Our bylaws may be amended by the affirmative vote of a majority of the directors then in office, subject to any limitations set forth in the bylaws; and may also be amended by the affirmative vote of at least 75% of the outstanding shares entitled to vote on the amendment, or, if our board of directors recommends that the stockholders approve the amendment, by the affirmative vote of the majority of the outstanding shares entitled to vote on the amendment, in each case voting together as a single class.
Undesignated Preferred Stock. Our certificate of incorporation provides for 5,000,000 authorized shares of preferred stock. The existence of authorized but unissued shares of preferred stock may enable our board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise. For example, if in the due exercise of its fiduciary obligations, our board of directors were to determine that a takeover proposal is not in the best interests of our stockholders, our board of directors could cause shares of preferred stock to be issued without stockholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer or insurgent stockholder or stockholder group. In this regard, our certificate of incorporation grants our board of directors broad power to establish the rights and preferences of authorized and unissued shares of preferred stock. The issuance of shares of preferred stock could decrease the amount of earnings and assets available for distribution to holders of shares of common stock. The issuance may also adversely affect the rights and powers, including voting rights, of these holders and may have the effect of delaying, deterring or preventing a change in control of us.
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” (any entity or person beneficially owning 15% or more of the outstanding voting stock) for a three-year period following the time that this stockholder becomes an interested stockholder, unless the business combination satisfies one of the following conditions:
 
		
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	before the stockholder became interested, our board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

		
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	upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, shares owned by persons who are directors and also officers, and employee stock plans, in some instances, but not the outstanding voting stock owned by the interested stockholder; or

		
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	at or after the time the stockholder became interested, the business combination was approved by our board of directors and authorized at an annual or special meeting of the stockholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 defines a business combination to include:
 
		
	•
	any merger or consolidation involving the corporation and the interested stockholder;

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

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

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

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

Market Listing

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

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