Document:

20191231 10K Ex 410

		
			Exhibit 4.10
		

		
			DESCRIPTION OF THE REGISTRANT’S SECURITIES 
		

		
			REGISTERED PURSUANT TO SECTION 12 OF 
		

		
			THE SECURITIES EXCHANGE ACT OF 1934
		

		
			Introduction
		

		
			Vermillion, Inc. (the “Company,” “we,” “us” or “our”) has one security registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended, which is our common stock. Our common stock is listed on The Nasdaq Capital Market under the symbol “VRML.”
		

		
			The following summary does not purport to be complete and is qualified by reference to certain provisions of the Delaware General Corporation Law, as amended (the “DGCL”), our Fourth Amended and Restated Certificate of Incorporation, dated January 22, 2010, as amended effective June 19, 2014 (our “Certificate of Incorporation”), and our Fifth Amended and Restated Bylaws, effective June 19, 2014  (our “Bylaws”), each of which has been filed as an exhibit to the Annual Report on Form 10-K filed with the Securities and Exchange Commission to which this exhibit is attached and is hereby incorporated by reference.
		

		
			Authorized Capital Stock 
		

		
			Our authorized capital stock consists of 150,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, par value $0.001 per share. 
		

		
			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 of such series to have such rights and preferences, including voting rights, dividend rights, conversion rights, redemption terms and liquidation preferences as shall be determined by our board of directors. Any issuance of shares of preferred stock could adversely affect the voting power or rights of holders of common stock, and the likelihood that the holders of preferred stock will receive dividend payments and payments upon liquidation could have the effect of delaying, deferring or preventing a change in control. 
		

		
			Common Stock 
		

		
			Voting Rights 
		

		
			Each holder of common stock is entitled to one vote for each share on all matters to be voted upon by the stockholders, and there are no cumulative voting rights. In all matters other than the election of directors, stockholder approval requires the affirmative vote of the majority of the holders of our common stock entitled to vote on the subject matter unless the matter is one upon which, by express provision of law, our Certificate of Incorporation or our Bylaws, a different vote is required.  Directors are elected by a plurality of the votes of the shares present in person or represented by proxy and entitled to vote on the election of directors.
		

		
			Dividend Rights 
		

		
			Subject to preferences to which holders of preferred stock may be entitled and the rights of certain of our stockholders set forth in the Stockholders Agreement (as defined below), holders of common stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by our board of directors out of funds legally available therefor. We have never paid or declared any dividend on our common stock, and we do not anticipate paying cash dividends on our common stock in the foreseeable future. We intend to retain all available funds and any future earnings to fund the development and expansion of our business. 
		

		

		

		 

 

		No Preemptive or Similar Rights 
		

		
			Holders of our common stock do not have preemptive rights, and our common stock is not convertible or redeemable. As described under “Stockholders Agreement,” certain holders of our common stock have the right to purchase shares in connection with most equity offerings made by the Company. 
		

		
			Right to Receive Liquidation Distributions 
		

		
			In the event of our liquidation, dissolution or winding up, holders of common stock would be entitled to share in our assets remaining after the payment of liabilities and the satisfaction of any liquidation preference granted the holders of any outstanding shares of any senior class of securities. The rights, preferences and privileges of the holders of common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock which we may designate in the future. 
		

		
			Stockholders Agreement 
		

		
			In connection with a private placement in May 2013, we entered into a stockholders agreement with the purchasers named therein (the “Stockholders Agreement”). Pursuant to and subject to the terms of the Stockholders Agreement, certain of the investors received rights to participate in any future equity offerings on the same price and terms as other investors, and rights to exercise “piggyback” registration rights for any registration statements that we file prior to May 13, 2018 on our own account or for the account of others with respect to shares of our common stock. 
		

		
			In addition, the Stockholders Agreement prohibits the Company from taking material actions without the consent of at least one of the two primary investors. These material actions include: 
		

		
			 
		

			
					
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						making any acquisition with value greater than $2 million; 

				
	
					
						 

					
					
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						entering into, or amending the terms of agreements with Quest Diagnostics, provided that such investors’ consent shall not be unreasonably withheld, conditioned or delayed following good faith consultation with the Company;

				
	
					
						 

					
					
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						submitting any resolution at a meeting of stockholders or in any other manner changing or authorizing a change in the size of our board of directors; 

				
	
					
						 

					
					
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						offering, selling or issuing any securities senior to our common stock or any securities that are convertible into or exchangeable or exercisable for securities ranking senior to our common stock; 

				
	
					
						 

					
					
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						amending our Certificate of Incorporation or our Bylaws in any manner that affects the rights, privileges or economics of our common stock or the warrants purchased in the May 2013 private placement; 

				
	
					
						 

					
					
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						taking any action that would result in a change in control of Vermillion or an insolvency event; 

				
	
					
						 

					
					
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						paying or declaring dividends on any securities of the Company or distributing any assets of the Company other than in the ordinary course of business or repurchasing any outstanding securities of the Company; or 

				
	
					
						 

					
					
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						adopting or amending any stockholder rights plan. 

				

		
			In addition, the two primary investors (Jack W. Schuler, on the one hand, and Oracle Partners, LP and Oracle Ten Fund Master, LP, on the other hand) each received the right to designate a person to serve on our board of directors. These rights terminate for each investor when that investor ceases to beneficially own less than 50% of the shares and warrants (taking into account shares issued upon exercise of the warrants), in the aggregate, that such investor purchased at the closing of our May 2013 private placement. 
		

		

		

		 

 

		Section 203 of the Delaware Corporation Law
		

		
			We are subject to Section 203 of the DGCL, which prevents an “interested stockholder” (defined in Section 203 of the DGCL, generally, as a person owning 15% or more of a corporation’s outstanding voting stock), from engaging in a “business combination” (as defined in Section 203 of the DGCL) with a publicly-held Delaware corporation for three years following the date such person became an interested stockholder, unless: 
		

		
			 
		

			
					
						 

					
					
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						before such person became an interested stockholder, the board of directors of the corporation approved the transaction in which the interested stockholder became an interested stockholder or approved the business combination; 

				
	
					
						 

					
					
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						upon consummation of the transaction that resulted in the interested stockholders becoming an interested stockholder, the interested stockholder owns at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced (excluding stock held by directors who are also officers of the corporation and by employee stock plans that do not provide employees with the rights to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer); or 

				
	
					
						 

					
					
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						following the transaction in which such person became an interested stockholder, the business combination is approved by the board of directors of the corporation and authorized at a meeting of stockholders by the affirmative vote of the holders of two-thirds of the outstanding voting stock of the corporation not owned by the interested stockholder. 

				

		
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			The provisions of Section 203 of the DGCL could make a takeover of the Company difficult. 
		

		
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			Effect of Certain Provisions of Our Certificate of Incorporation and Bylaws
		

		
			Certain provisions of our Certificate of Incorporation and Bylaws may also have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from attempting to acquire, control of us. Such provisions could limit the price that certain investors might be willing to pay in the future for our securities. Our Certificate of Incorporation eliminates the right of stockholders to call special meetings of stockholders or to act by written consent without a meeting, and our Bylaws require advance notice for stockholder proposals and director nominations, which may preclude stockholders from bringing matters before an annual meeting of stockholders or from making nominations for directors at an annual meeting of stockholders. Our Certificate of Incorporation authorizes undesignated preferred stock, which 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 change control of us.
		

		
			These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management of us. The amendment of any of the provisions of our Certificate of Incorporation described in the immediately preceding paragraph would require approval by our board of directors and the affirmative vote of at least 66 2/3% of our then outstanding voting securities, and the amendment of any of the provisions of our Bylaws described in the immediately preceding paragraph would require approval by our board of directors or the affirmative vote of at least 66 2/3% of our then outstanding voting securities.20191231 10K EX 44

			

					

						 

					

					

						 

					

					

						 

					

					

						 

					

					

						 

					

					

						 

				
	

					

						 

					

					

						 

					

					

						 

					

					

						 

					

					

						 

					

					

						Exhibit 4.4

				

		

			 

		

		
			AMENDED AND RESTATED PROMISSORY NOTE #1
		

		
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			$2,000,000.00April 3, 2020
		

		
			Trumbull, Connecticut
		

		
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			FOR VALUE RECEIVED, the undersigned, VERMILLION, INC., a Delaware corporation authorized to conduct business in the State of Connecticut, with an office and principal place of business located at 12117 Bee Caves Road, Building III, Suite 100, Austin, Texas 78738 (the “Applicant”), promises to pay to the order of the STATE OF CONNECTICUT, acting by and through its DEPARTMENT OF ECONOMIC AND COMMUNITY DEVELOPMENT (“State”), at its office at 505 Hudson Street, Hartford, Connecticut 06106 or at such other place as the holder hereof (including State, hereinafter referred to as “Holder”) may designate, the sum of  TWO MILLION 00/100 DOLLARS ($2,000,000.00) or such lesser amount as may be due and payable to State under the terms and conditions of that certain Assistance Agreement dated March 22, 2016, as amended by a First Amendment to Assistance Agreement dated March 7, 2018, and as further amended by Second Amended and Restated Agreement of even date herewith by and between Applicant and State (collectively, the “Assistance Agreement”), the terms of which are incorporated by reference herein, together with interest on the unpaid balance of this Note at the rate set forth in Section 2(a) hereof, which interest shall be computed and payable as set forth therein, together with all taxes levied or assessed on this Note or the debt evidenced hereby against the Holder, and together with all reasonable costs, expenses and reasonable attorneys’ and other reasonable professionals’ fees incurred in any action to collect and/or enforce this Note or to enforce, protect, preserve, defend, realize upon or foreclose any security agreement, or other agreement securing or relating to this Note, including without limitation, all reasonable costs and expenses incurred to enforce, protect, preserve, defend or sustain the lien of said security agreement, or other agreement or in any litigation or controversy arising from or connected in any manner with said security  agreement, or other agreement, or this Note.  Applicant further agrees to pay all reasonable costs, expenses and reasonable attorneys’ and other reasonable professionals’ fees incurred by Holder in connection with any “workout” or default resolution negotiations involving legal counsel or other professionals and further in connection with any re-negotiation or restructuring of the indebtedness evidenced by this Note.  Any such costs, expenses and/or fees remaining unpaid after demand therefor, may, at the discretion of the Holder, be added to the principal amount of the indebtedness evidenced by this Note.
		

		
			All capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Assistance Agreement.
		

		
			This Note has been executed and delivered subject to the following terms and conditions:
		

		
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				 1.
			Lawful Interest.  Notwithstanding any provisions of this Note, it is the understanding and agreement of the Applicant and Holder that the maximum rate of interest to be paid by Applicant to Holder shall not exceed the highest or the maximum rate of interest permissible to be charged under the laws of the State of Connecticut. Any amounts paid in excess of such rate shall be considered to have been payments in reduction of principal.

		
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			Payments of Principal and Interest.  

		
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				 (a)
			The principal amount of this Note shall bear interest at a rate of two percent (2%) per annum (the “Loan Interest Rate”) commencing on the date on which the initial advance in respect of the Loan is funded (the “Advancement Date”).  Commencing on the first day of the second month following  the Advancement Date, which  was April 15, 2016, and continuing on the same day of each and every month thereafter until the date which is ten (10) years from the first day of the month following the Advancement Date (the “Maturity Date”), and so long as no Instance of Default shall have occurred and remains uncured past any applicable cure period, principal and interest under this Note shall be payable in one hundred twenty (120) equal monthly installments in such a manner as to fully amortize the Loan over the remaining term of this Note. 

		
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				 (b)
			The entire indebtedness under this Note, including, all outstanding principal (including amounts not forgiven or repaid), accrued and unpaid interest, if any, and any other obligations due hereunder or under the Assistance Agreement, shall be due and payable in full on the Maturity Date.  

		
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				 (c)
			Payments in respect of this Note shall be made payable to “The State of Connecticut, Department of Economic and Community Development”.

		
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			   Late Charge.  In the event Applicant fails to pay any installment of principal and/or interest within fifteen (15) days of the date when said amount was due and payable, without in any way affecting the Holder’s right to accelerate this Note, a late charge equal to five percent (5.00%) of such late payment shall, at the option of Holder, be assessed against Applicant and be due upon demand by the Holder.

		
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			4.Prepayments.  The Applicant may prepay principal of this Note, in whole or in part, at any time without penalty or premium.  Any and all prepayments shall be applied first to accrued and unpaid interest and then to unpaid principal in the inverse order of maturity, and shall not affect the obligation of Applicant to pay the regular installments required hereunder until the entire indebtedness has been paid except as otherwise provided in the Assistance Agreement.
		

		
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			5.Instances of Default.  The Applicant agrees that the occurrence of an Instance of Default under the Assistance Agreement shall constitute an “Instance of Default” hereunder.  Upon the occurrence of any Instance of Default, which remains uncured past any applicable cure period, if any, the entire indebtedness with accrued interest thereon and any other sums due under this Note, shall, at the option of the Holder, become immediately due and payable without 
		

		 

 

		presentment or demand for payment, notice of non-payment, protest or any other notice or demand of any kind, all of which are expressly waived by the Applicant.  Failure to exercise such option shall not constitute a waiver of the right to exercise the same in the event of any subsequent default.  Upon the occurrence of any Instance of Default the interest rate shall increase to fifteen per cent per annum (15%) (the “Default Rate”) and liquidated damages may be assessed in accordance with Section 4.2(C)(3) of the Assistance Agreement.
		

		
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			6.No Waiver.  No delay or omission by Holder in exercising any rights hereunder, nor failure by the Holder to insist upon the strict performance by Applicant of any terms and provisions herein shall operate as or be deemed to be a waiver of such right, any other right hereunder, or any terms and provisions herein, and the Holder shall retain the right thereafter to insist upon strict performance by the Applicant of any and all terms and provisions of this Note or any document securing the repayment of this Note.  No waiver of any right shall be effective unless in writing and signed by Holder, nor shall a waiver on one occasion be considered as a bar to, or waiver of, any such right on any future occasion.
		

		
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			7.Prejudgment Remedy and Other Waivers.  APPLICANT ACKNOWLEDGES THAT THE LOAN EVIDENCED BY THIS NOTE IS A COMMERCIAL TRANSACTION AND WAIVES APPLICANT’S RIGHTS TO NOTICE AND HEARING, OR THE ESTABLISHMENT OF A BOND, WITH OR WITHOUT SURETY, UNDER CHAPTER 903a OF THE CONNECTICUT GENERAL STATUTES, OR AS OTHERWISE ALLOWED BY ANY STATE OR FEDERAL LAW WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH HOLDER MAY DESIRE TO USE, AND FURTHER WAIVES DILIGENCE, DEMAND, PRESENTMENT FOR PAYMENT, NOTICE OF NONPAYMENT, PROTEST AND NOTICE OF PROTEST, AND NOTICE OF ANY RENEWALS OR EXTENSIONS OF THIS NOTE, AND ALL RIGHTS UNDER ANY STATUTE OF LIMITATIONS. THE APPLICANT ACKNOWLEDGES THAT APPLICANT MAKES THESE WAIVERS KNOWINGLY AND VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER. THE APPLICANT FURTHER ACKNOWLEDGES THAT THE LENDER HAS NOT AGREED WITH OR REPRESENTED TO APPLICANT OR ANY OTHER PARTY HERETO THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
		

		
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			8.Jury Waiver.  THE APPLICANT HEREBY WAIVES TRIAL BY JURY IN ANY COURT AND IN ANY SUIT, ACTION OR PROCEEDING ON ANY MATTER ARISING IN CONNECTION WITH OR IN ANY WAY RELATED TO THE FINANCING TRANSACTIONS OF WHICH THIS NOTE IS A PART AND/OR THE ENFORCEMENT OF ANY OF YOUR RIGHTS AND REMEDIES, INCLUDING WITHOUT LIMITATION, TORT CLAIMS. THE APPLICANT ACKNOWLEDGES THAT APPLICANT MAKES THIS WAIVER KNOWINGLY AND VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER. THE APPLICANT FURTHER ACKNOWLEDGES THAT THE LENDER HAS NOT AGREED WITH OR 
		

		 

 

		REPRESENTED TO APPLICANT OR ANY OTHER PARTY HERETO THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
		

		
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			9.Miscellaneous.  The provisions of this Note shall be binding upon the Applicant, its successors and assigns and shall inure to the benefit of Holder, its successors and assigns.  If any provision of this Note shall, to any extent, be held invalid or unenforceable, then only such provision shall be deemed ineffective and the remainder of this Note shall not be affected.  This Note shall be governed by and construed in accordance with the laws of the State of Connecticut (but not its conflicts of law provisions).
		

		
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			10. Security. This Note is secured by a Security Agreement and Patent Security Agreement between Applicant and the State.
		

		
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						VERMILLION, INC.

				
	
					
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						By:

					
					
						/s/ Valerie B. Palmieri

				
	
					
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						Valerie B. Palmieri

				
	
					
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						Its President and CEO

				
	
					
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						Duly Authorized

				
	
					
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						Dated: April 3, 2020

				

		
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