Document:

exhibit10102022performan

  EXHIBIT 10.10  82    2022 PERFORMANCE-BASED RESTRICTED STOCK UNIT AGREEMENT  Company: Simpson Manufacturing Co., Inc.     Recipient: The recipient’s name (the “Recipient”) is set forth on the  Recipient’s online award acceptance page on Fidelity Stock  Plan Services LLC website (the “Acceptance Page”) at  https://www.netbenefits.com, which is incorporated by  reference to this Agreement.     Target PSU Shares: The aggregate number of shares of Common Stock as stated  on the Acceptance Page.     Target Opportunity 100% of the Target PSU Shares     Performance Period  (the “Performance Period”)  A three-year period beginning on January 1, 2022 and ending  on December 31, 2024.      The Number of Shares of  Common Stock Subject to  PSUs Granted Hereunder  (the “PSU Shares”):  200% of the Target PSU Shares.     The Effective Date of the Award  (the “Award Date”):  A date in 2022 as determined by the Committee in its absolute  discretion and as set forth on the Acceptance Page.           The Date the PSU Shares  Vest  (the “Vesting Date”):  A date subsequent to the Performance Period as determined  by the Committee in its absolute discretion and as set forth  on the Acceptance Page.     Vesting Period  (the “Vesting Period”):  A period beginning on the Award Date, and ending on the  Vesting Date; provided, however, that if the Vesting Date  falls on a weekend or federal holiday, such period shall end  on the immediately following business day.1     Specific Performance Goals  (the “Specific Performance  Goals”):  The Specific Performance Goals are set forth on Exhibit A.    This PERFORMANCE-BASED RESTRICTED STOCK UNIT AGREEMENT (this “Agreement”) is made  as of the Award Date stated on the Acceptance Page by and between Simpson Manufacturing Co., Inc., a Delaware  corporation (the “Company”), and the Recipient named on the Acceptance Page, with reference to the following facts:  Capitalized terms used and not otherwise defined in this Agreement have the meanings ascribed to such terms  in the amended and restated Simpson Manufacturing Co., Inc. 2011 Incentive Plan effective on April 21, 2015 (as  amended and/or restated from time to time, the “Plan”).  The Board has delegated to the Committee all authority to  administer the Plan.  The Committee has determined to grant to the Recipient, under the Plan, performance-based  Restricted Stock Units (the “PSUs”) with respect to the PSU Shares stated on the Acceptance Page.                                                      1 For example, if the Award Date is determined by the Committee to be January 20, 2022 and the Vesting Date is determined by  the Committee to be February 15, 2025, then the PSU Shares, if any (based on the Specific Performance Goals), will vest on  February 15, 2025 and the Vesting Period will be from January 20, 2022 to February 15, 2025.  

 

  EXHIBIT 10.10  83    To evidence the PSUs and to set forth the terms and conditions thereof, the Company and the Recipient agree  as follows:  1. Confirmation of Grant.  (a) The Company grants the PSUs to the Recipient and the Recipient agrees to accept the PSUs  and participate in the Plan, effective as of the Award Date.  As a condition of the grant, this Agreement and the PSUs  shall be governed by the terms and conditions of the Plan and shall be subject to all applicable policies and guidelines  of the Company, including the Company’s compensation recovery policy, stock ownership, and hedging, pledging  and trading policies.  (b) The PSUs shall be reflected in a bookkeeping account maintained by the Company through  the date on which the PSUs become vested pursuant to section 2 or are forfeited pursuant to section 3.    (c) The Recipient acknowledges and agrees that (i) the PSU Shares represent the maximum  number of shares of Common Stock that are granted under the PSUs and are not necessarily the number of shares of  Common Stock that will eventually vest in favor of the Recipient, and (ii) pursuant to section 2 and otherwise in  accordance with this Agreement and the Plan, the number of shares of Common Stock, which will eventually vest in  favor of the Recipient under the PSUs (the “Vested Shares”), will be subject to the Specific Performance Goals and  will be between 0% and 200% of the Target PSU Shares.  (d) The Company’s obligations under this Agreement shall be unfunded and unsecured.  No  special or separate fund shall be established therefor and no other segregation of assets shall be required or made with  respect thereto.  The rights of the Recipient under this Agreement shall be no greater than those of a general unsecured  creditor of the Company.  (e) Except as otherwise provided in this Agreement and the Plan, the PSUs shall be settled by  the issuance and delivery of the Vested Shares, or as provided in this Section 1(d), by cash or a combination thereof  (as determined by the Committee in its sole discretion), within sixty days after the last day of the Vesting Period (a  time or fixed schedule specified for the purpose of Code section 409A) subject to satisfaction of any other terms and  conditions applicable to the PSUs; provided, however, that the number of the Vested Shares issued or delivered (or  for which a cash payment is made) to the Recipient in any calendar year, together with the number of shares of  Common Stock issued or delivered (or for which a cash payment is made) to the Recipient in the same calendar year  under any other RSU Awards, shall not exceed the annual maximum aggregate number of shares of Common Stock  issuable or deliverable under RSU Awards as set forth in the Plan that is effective at the time of the issuance or delivery  of (or making a cash payment for) the Vested Shares.    (f) In settling the PSUs pursuant to Section 1(e), the Company (or its acquirer or successor)  shall have the option (as determined by the Committee in its sole discretion) to make or provide for a cash payment  to the Recipient, in exchange for the cancellation of the vested PSUs (or any portion thereof), in an amount equal to  the product of (A) the number of the Vested Shares under the cancelled PSUs and (B) the average closing price of a  share of Common Stock over the period ending on the date the PSUs become vested and starting sixty days prior to  that date.    (g) Anything herein to the contrary notwithstanding, this Agreement does not create an  obligation on the part of the Company to adopt any policy or procedure, agree to any amendment hereto, make any  arrangement, or take any other action, to comply with Code section 409A.  The Recipient agrees and acknowledges  that the Company makes no representations that this Agreement, including the grant, vesting and/or delivery of the  PSU Shares (and/or cash), does not violate Code section 409A, and the Company shall have no liability whatsoever  to the Recipient if he or she is subject to any taxes or penalties under Code section 409A.  2. Specific Performance Goals.  The Specific Performance Goals for the Performance Period shall  relate to the following equally weighted performance measures: (i) revenue growth and (ii) return on invested capital  (ROIC). The Specific Performance Goals for the Performance Period are described in Exhibit A.   

 

  EXHIBIT 10.10  84    3. Vesting. The Committee shall determine the number of vested PSUs at the end of the Performance  Period in accordance with Exhibit A:  4. Effect of Retirement.   (a) Subject to the terms and conditions of this Agreement and the Plan and unless otherwise  forfeited pursuant to section 3, the PSUs shall vest, and the Restricted Period with respect to the PSUs shall terminate,  immediately following the last day of the Vesting Period; provided, however, that the PSUs shall vest during the  Vesting Period on the date,   (i) immediately preceding the effective date of the Recipient’s Retirement as  determined by the Committee in relation to the PSUs: either (A) after reaching age 70 or (B) after reaching age 55 and  having been employed or engaged by the Company or any Subsidiary for 15 years (provided that, if the Recipient  retires after reaching age 56, for each year after age 55, the Recipient may work one year less for the Company or any  Subsidiary, as applicable, and still be qualified for Retirement under this sub-section (i)2),  (ii) immediately preceding the Recipient’s death or the effective date of the  Recipient’s Disability, and   (iii) the effective date of the termination of the Recipient’s employment or engagement  with the Company or any Subsidiary by the Company or Subsidiary (which, whenever used in this Agreement,  includes any such entity’s successor) without Cause,3 or by the Recipient for a Good Reason,4 in either case only in  connection with or within 24 months following a Sale Event.5                                                      2 For example, if the Recipient retires at age 60 during the Vesting Period, he or she only needs to have worked for the Company  or the applicable Subsidiary for 10 years to be qualified for Retirement and receive the Vested Shares; and for example, if the  Recipient retires at age 65 during the Vesting Period, he or she only needs to have worked for the Company or the applicable  Subsidiary for 5 years to be qualified for Retirement and receive the Vested Shares.  3 “Cause” means, in addition to any cause for termination as provided in any other applicable written agreement between the  Company, the applicable Subsidiary, or the acquirer or successor of the Company or Subsidiary, and the Recipient, (i) conviction  of any felony, (ii) any material breach  or violation by the Recipient of any agreement to which the Recipient and the Company or  the Subsidiary that employs or engages the Recipient are parties or of any published policy or guideline of the Company, (iii) any  act (other than retirement or other termination of employment or engagement) or omission to act by the Recipient which may have  a material and adverse effect on the business of the Company or Subsidiary or on the Recipient’s ability to perform services for the  Company or Subsidiary, including habitual insobriety or substance abuse or the commission of any crime, gross negligence, fraud  or dishonesty with regard to the Company or Subsidiary, or (iv) any material misconduct or neglect of duties and responsibilities  by the Recipient in connection with the business or affairs of the Company or Subsidiary; provided, however, that the Recipient  first shall have received written notice, which shall specifically identify what the Company or Subsidiary believes constitutes Cause,  and if the breach, act, omission, misconduct or neglect is capable of being cured, the Recipient shall have failed to cure after 15  days following such notice.  4 A “Good Reason” means the occurrence of any of the following events: (i) a material adverse change in the functions, duties or  responsibilities of the Recipient’s position (other than a termination by the Company or Subsidiary) which would meaningfully  reduce the level, importance or scope of such position (provided that, a change in the person, position and/or department to whom  the Recipient is required to report shall not by itself constitute a material adverse change in the Recipient’s position), (ii) the  relocation of the Company or Subsidiary office at which the Recipient is principally located immediately prior to a Sale Event (the  “Original Office”) to a new location outside of the metropolitan area of the Original Office or the failure to place the Recipient’s  own office in the Original Office (or at the office to which such office is relocated which is within the metropolitan area of the  Original Office), or (iii) a material reduction in the Recipient’s base salary and incentive compensation opportunity as in effect  immediately prior to a Sale Event; provided, however, that, within 90 days of the incident that provides the basis for a Good Reason  termination, the Recipient shall have provided the Company or Subsidiary a written notice specifically identifying what the  Recipient believes constitutes a Good Reason, and the Company or Subsidiary shall have failed to cure the adverse change,  relocation or compensation reduction after 30 days following such notice.  5 A “Sale Event” shall mean (i) the sale or other disposition of all or substantially all of the assets of the Company or the Subsidiary  that employs or engages the Recipient, including a majority or more of all outstanding stock of the Subsidiary, on a consolidated  basis to one or more unrelated persons or entities, (ii) a Change in Control, or (iii) the sale or other transfer of outstanding Common  Stock to one or more unrelated persons or entities (including by way of a merger, reorganization or consolidation in which the  

 

  EXHIBIT 10.10  85    (b) On the day that the PSUs become vested pursuant to Sections 4(a)(i), (ii) and (iii), the PSU  Shares stated on the Acceptance Page shall be adjusted pursuant to the Specific Performance Goals as set forth on  Exhibit A attached hereto, and after the adjustment, become the total number of the Vested Shares that will be used to  settle the PSUs under section 1(e); provided, however, that,   (i) if the PSUs have vested during the Vesting Period, the PSUs shall continue to be  subject to the terms and conditions of this Agreement, including adjustment pursuant to the Specific Performance  Goals during the Vesting Period, and   (ii) in addition, the number of Vested Shares that will be used to settle the PSUs under  section 1(d) will be prorated so that the Recipient will only receive a portion of the Vested Shares that is equal to the  product of (1) the number of the Vested Shares and (2) a percentage that is equal to the number of days between and  including the first day of the Vesting Period and the day when the PSUs become vested as divided by the number of  days of the whole Vesting Period.    (c) The Recipient explicitly acknowledges and agrees that (i) the Committee has the absolute  discretion to determine the number of the Vested Shares, (ii) the Committee may engage professional advisors and  consultants and rely on their opinions and advice to make such determination, (iii) such determination shall be binding  on the Recipient, and (iv) the granting or vesting of the PSUs as well as the Recipient’s holding of the Vested Shares  shall be subject to all applicable policies and guidelines of the Company, including the Company’s compensation  recovery, stock ownership, and hedging, pledging and trading policies.  5. Forfeiture.  Anything herein to the contrary notwithstanding, (a) all PSUs that are not vested in  accordance with section 2 shall terminate immediately and be forfeited in their entirety if and at such time as (i) the  Recipient ceases to be an Employee, Outside Director or Consultant, as the case may be, or (ii) 24 months have passed  immediately following a Sale Event (provided that, in the event the surviving or acquiring entity or the new entity  resulting from a Sale Event substitutes a similar equity award for the PSUs, such award will continue in accordance  with its own terms and conditions), and (b) all PSUs, to the extent not theretofore settled in accordance with section  1(d), shall terminate immediately and be forfeited in their entirety when and as provided in section 13(I) of the Plan.  6. Tax Withholding.  Pursuant to section 10 of the Plan, the Company may require the Recipient to  enter into an arrangement providing for the payment in cash, Common Stock or otherwise by the Recipient to the  Company of any tax withholding obligation of the Company arising by reason of (a) the granting or vesting of the  PSUs, (b) the lapse of any substantial risk of forfeiture to which the PSUs or the Vested Shares are subject, or (c) the  disposition of the PSUs or the Vested Shares, to the extent such arrangement does not cause a loss of the Section 16(b)  exemption pursuant to Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended.  7. Representations and Warranties of the Company.  The Company represents and warrants to the  Recipient that the Vested Shares, when issued and delivered on the vesting of the PSUs in accordance with this  Agreement, will be duly authorized, validly issued, fully paid and non-assessable.  8. Recipient Representations.  The Recipient represents and warrants to the Company that the  Recipient has received and read this Agreement and the Plan, that the Recipient has consulted with the Recipient’s  own legal, financial and other advisers regarding this Agreement and the Plan to the extent that the Recipient  considered necessary or appropriate, that the Recipient fully understands and accepts all of the terms and conditions  of this Agreement and the Plan, and that the Recipient is relying solely on the Recipient’s own advisers with respect  to the tax consequences of this Agreement and the PSUs.                                                    outstanding Common Stock are converted into or exchanged for securities of the successor entity) where the stockholders of the  Company, immediately prior to such sale or other transfer, would not, immediately after such sale or transfer, beneficially own  shares representing in the aggregate more than 50 percent of the voting shares of the acquirer or surviving entity (or its ultimate  parent corporation, if any).  For the purpose of sub-section (iii) of this definition, only voting shares of the acquirer or surviving  entity (or its ultimate parent, if any) received by stockholders of the Company in exchange for Common Stock shall be counted,  and any voting shares of the acquirer or surviving entity (or its ultimate parent, if any) already owned by stockholders of the  Company prior to the transaction shall be disregarded.  

 

  EXHIBIT 10.10  86    9. Change in Control.  Notwithstanding section 9 of the Plan, a Change in Control shall be treated as  a Sale Event with respect to the PSUs granted hereunder.  10. Adjustments to Reflect Capital Changes.  Subject to and except as otherwise provided in section 9  of the Plan, the number and kind of shares subject to the PSUs shall be appropriately adjusted, as the Committee may  determine pursuant to section 11 of the Plan, to reflect any stock split, stock dividend, recapitalization, merger,  consolidation, reorganization, combination, exchange of shares, split-up, split-off, spin-off, liquidation or other similar  change in capitalization, or any distribution to common stockholders other than normal cash dividends.  11. No Rights as Stockholder.  Neither the granting or vesting of the PSUs nor the issuance or delivery  of the Vested Shares shall entitle the Recipient, as such, or any of the Recipient’s Beneficiaries or Personal  Representative, to any rights of a stockholder of the Company, unless and until the Vested Shares are registered on  the Company’s records in the name or names of the Recipient or the Recipient’s Beneficiaries or Personal  Representative, as the case may be, and then only with respect to such Vested Shares so registered.   12. No Right to Continued Employment.  Nothing in this Agreement shall confer on the Recipient any  right to continue in the employment of, or service to, the Company or any Subsidiary or limit, interfere with or  otherwise affect in any way the right of the Company or any Subsidiary to terminate the Recipient’s employment or  service at any time.  If the Award of the PSUs is in connection with the Recipient’s performance of services as a  Consultant or Outside Director, references to employment, employee and similar terms shall be deemed to include the  performance of services as a Consultant or an Outside Director, as the case may be; provided that no rights as an  Employee shall arise by reason of the use of such terms.  13. Regulatory Compliance.  Notwithstanding anything herein to the contrary, the issuance and delivery  of the Vested Shares shall in all events be subject to and governed by section 13(C) of the Plan.  14. Notices.  Any notice, consent, demand or other communication to be given under or in connection  with this Agreement shall be in writing and shall be deemed duly given and received when delivered personally, when  transmitted by facsimile, one business day after being deposited for next-day delivery with a nationally recognized  overnight delivery service, or three days after being mailed by first class mail, charges or postage prepaid, properly  addressed, if to the Company, at its principal office in California, and, if to the Recipient, at the Recipient’s address  on the Company’s records.  Either party may change such party’s address or facsimile number from time to time by  notice hereunder to the other.  15. Entire Agreement.  This Agreement and the Plan together contain the entire agreement of the parties  and supersede all prior or contemporaneous negotiations, correspondence, understandings and agreements, whether  written or oral, between the parties, regarding the PSUs.  The Recipient specifically acknowledges and agrees that all  descriptions of the PSUs in any prior letters, memoranda or other documents provided to him or her by the Company  or any Subsidiary are hereby replaced and superseded in their entirety by this Agreement and shall be of no further  force or effect.  To the extent there is any inconsistency between the descriptions of any such documents and the terms  of this Agreement, the terms of this Agreement shall prevail.  16. Amendment.  This Agreement may be amended, modified or supplemented only by a written  instrument signed by the Recipient and the Company.  17. Assignment.  The Recipient shall not sell, assign, transfer, pledge, hypothecate or otherwise  encumber or dispose of this Agreement, any of the PSUs or any other rights hereunder, and shall not delegate any  duties hereunder, except only as may be permitted pursuant to section 13(B) of the Plan, and any such action or  transaction that may otherwise be attempted or purported by the Recipient shall be void and of no effect; provided,  however, that this section 15 does not restrict the sale, assignment, transfer, pledging, hypothecation or other  encumbrance or disposal of Vested Shares.  18. Successors.  Subject to section 15, this Agreement shall bind and inure to the benefit of the Company  and the Recipient and their respective successors, assigns, heirs, legatees, devisees, executors, administrators and legal  

 

  EXHIBIT 10.10  87    representatives.  Nothing in this Agreement, express or implied, is intended to confer on any other Person any right or  benefit in or under this Agreement or the Plan.  19. Separate Payments.  All amounts payable in connection with the PSUs hereunder or any other  Awards granted under the Plan shall be treated as separate payments for the purposes of Code section 409A.  20. Governing Law.  This Agreement shall be governed by and construed and interpreted in accordance  with the laws of the State of Delaware.  21. Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall  be deemed an original but all of which together shall constitute one and the same instrument.  22. Order of Precedence and Construction.  This Agreement and the PSUs are subject to all provisions  of the Plan (a copy of which is attached hereto as Exhibit B), including the Restricted Stock Unit provisions of section  6 thereof, and are further subject to all interpretations and amendments thereto that may from time to time be adopted  pursuant to the Plan.  In the event of any inconsistency between any provision of this Agreement and any provision  of the Plan, the provision of the Plan shall govern.  The headings of sections herein are for convenience of reference  only, are not part of this Agreement and shall not affect the construction or interpretation of any provision hereof.   Whenever the context requires, the use in this Agreement of the singular number shall be deemed to include the plural  and vice versa, and each gender shall be deemed to include each other gender.  References herein to sections refer to  sections of this Agreement, except as otherwise stated.  The meaning of general words is not limited by specific  examples introduced by “includes”, “including”, “for example”, “such as” or similar expressions, which shall be  deemed to be followed by the phrase “without limitation”.  23. Further Assurances.  The Recipient agrees to do and perform all acts and execute and deliver all  additional documents, instruments and agreements as the Company or the Committee may reasonably request in  connection with this Agreement.  24. Data Privacy.  Recipient hereby explicitly and unambiguously consents to the collection, use and  transfer, in electronic or other form, of Recipient’s personal data as described in this Agreement by and among, as  applicable, Recipient’s employer, the Company, and any Subsidiary for the exclusive purposes of implementing,  administering, and managing Recipient’s participation in the Plan.  Recipient understands that the Company and the  employing Subsidiary may hold certain personal information about Recipient, including, but not limited to,  Recipient’s name, home address and telephone number, date of birth, social insurance number or other identification  number, salary, nationality, job title, and any shares of stock or directorships held in the Company or any Subsidiary,  details of all PSUs or any other entitlement to shares of stock awarded, canceled, exercised, vested, unvested or  outstanding in Recipient’s favor (“Personal Data”).  Recipient understands that Personal Data may be transferred to  any third parties assisting in the implementation, administration and management of the Plan, that these entities may  be located in Recipient’s country, or elsewhere, and that the third parties’ country may have different data privacy  laws and protections than Recipient’s country.  Recipient understands that he or she may request a list with the names  and addresses of any potential third parties in receipt of the Personal Data by contacting the Company’s Equity Plans  Administrator.  Recipient authorizes the third parties to receive, possess, use, retain and transfer the Personal Data, in  electronic or other form, for the purposes of implementing, administering and managing Recipient’s participation in  the Plan, including any requisite transfer of such Personal Data as may be required to a broker or other third party with  whom Recipient may elect to deposit any Vested Shares received upon vest of the PSUs.  Recipient understands that  Personal Data will be held as long as is necessary to administer and manage Recipient’s participation in the Plan.   Recipient understands that he or she may, at any time, view Personal Data, request additional information about the  storage and processing of Personal Data, require any necessary amendments to Personal Data or refuse or withdraw  the consents herein, without cost, by contacting in writing the Company’s Equity Plans Administrator.  Recipient  understands that refusal or withdrawal of consent may affect Recipient’s ability to realize benefits from the PSUs.  For  more information on the consequences of Recipient’s refusal to consent or withdrawal of consent, Recipient  understands that he or she may contact the Company’s Equity Plans Administrator.  25. Electronic Delivery.  The Company may, in its sole discretion, decide (a) to deliver or effect by  electronic means any documents or communications related to the PSUs granted under the Plan, Recipient’s  participation in the Plan, or future Awards that may be granted under the Plan or (b) to request by electronic means  

 

  EXHIBIT 10.10  88    Recipient’s consent to participate in the Plan and other communications related to the PSUs or the Plan.  Recipient  hereby consents to receive such documents and communications by electronic delivery and, if requested, to agree to  participate in the Plan and deliver or effect such other communications through an on-line or electronic system  established and maintained by the Company or any third party designated by the Company.     [Signature Page Follows]  

 

  EXHIBIT 10.10  89    IN WITNESS WHEREOF, this Restricted Stock Unit Agreement has been duly executed by or on behalf  of the Company and the Recipient as of the Award Date.  COMPANY:    SIMPSON MANUFACTURING CO., INC.      By ___________________________________   Authorized Signatory for the Compensation   and Leadership Development Committee   of the Board of Directors        ACCEPTANCE OF AGREEMENT:  Through the electronic submission of his or her consent to this Restricted  Stock Unit Agreement in accordance with the instructions on Fidelity Stock Plan Services’ NetBenefits website, the  Recipient hereby confirms, ratifies, approves and accepts all of the terms and conditions of this Restricted Stock  Unit Agreement.Document

Exhibit 4.1
Description of Securities
Registered Pursuant to Section 12 of the
Securities Exchange Act of 1934

All references below to “National Vision Holdings, Inc.,” “National Vision,” the “Company,” “we,” “our” or “us” refer to National Vision Holdings, Inc., a Delaware corporation, and not to its subsidiaries.  As of January 1, 2022, National Vision had one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended: common stock, par value $0.01 per share. 

The following description of our common stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our Third Amended and Restated Certificate of Incorporation, as amended (our “certificate of incorporation”) and our Third Amended and Restated Bylaws (our “bylaws”), which are each incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit is a part. We encourage you to read our certificate of incorporation and bylaws, and the applicable provisions of the Delaware General Corporation Law (“DGCL”) for additional information.

Authorized Capital Stock

Our authorized capital stock consists of 200,000,000 shares of common stock, par value $0.01 per share, and 50,000,000 shares of preferred stock, par value $0.01 per share.  

Our certificate of incorporation authorizes our board of directors (the “Board of Directors”) to establish one or more series of preferred stock (including convertible preferred stock). Unless required by law or by NASDAQ, the authorized shares of preferred stock will be available for issuance without further action by shareholders. Our Board of Directors is able to determine, with respect to any series of preferred stock, the terms and rights of that series.  As of January 1, 2022, there were no outstanding series of preferred stock.

Common Stock Voting and Other Rights

Holders of our common stock are entitled to one vote for each share held of record on all matters on which stockholders are entitled to vote generally, including the election or removal of directors, subject to certain limitations.  For example, except as required by law, holders of our common stock are not entitled to vote on any amendment to the certificate of incorporation that relates solely to the terms of one or more outstanding series of preferred stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to our certificate of incorporation or pursuant to the DGCL.  The holders of our common stock do not have cumulative voting rights in the election of directors. Upon our liquidation, dissolution or winding up or the sale of all or substantially all of our assets and after payment in full of all amounts required to be paid to creditors and to the holders of preferred stock having liquidation preferences, if any, the holders of our common stock will be entitled to receive our remaining assets available for distribution on a pro rata basis.  Holders of our common stock do not have preemptive, subscription, redemption or conversion rights.  The common stock is not subject to further calls or assessment by us. There are no redemption or sinking fund provisions applicable to the common stock.  The rights, powers, preferences and privileges of holders of our common stock will be subject to those of the holders of any shares of our preferred stock we may authorize and issue in the future.

Dividends

The DGCL permits a corporation to declare and pay dividends out of “surplus” or, if there is no “surplus,” out of its net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year. “Surplus” is defined as the excess of the net assets of the corporation over the amount determined to be the capital of the corporation by the board of directors. The capital of the corporation is typically calculated to be (and cannot be less than) the aggregate par value of all issued shares of capital stock. Net assets equal the fair value of the total assets minus total liabilities. The DGCL also provides that dividends may not be paid out of net profits if, after the payment of the dividend, capital is less than the capital represented by the outstanding stock of all classes having a preference upon the distribution of assets.

1

Declaration and payment of any dividend will be subject to the discretion of our Board of Directors and the rights, if any, of the holders of any outstanding series of preferred stock or any class or series of stock having a preference over or the right to participate with the common stock with respect to the payment of dividends. The time and amount of dividends will be dependent upon our financial condition, operations, cash requirements and availability, debt repayment obligations, capital expenditure needs and restrictions in our debt instruments, industry trends, the provisions of Delaware law affecting the payment of dividends to stockholders and any other factors our Board of Directors may consider relevant.

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

Our certificate of incorporation, bylaws and the DGCL, which are summarized in the following paragraphs, contain provisions that are intended to enhance the likelihood of continuity and stability in the composition of our Board of Directors. These provisions are intended to avoid costly takeover battles, reduce our vulnerability to a hostile change of control and enhance the ability of our Board of Directors to maximize stockholder value in connection with any unsolicited offer to acquire us. However, these provisions may have an anti-takeover effect and may delay, deter or prevent a merger or acquisition of our company by means of a tender offer, a proxy contest or other takeover attempt that a stockholder might consider is in its best interest, including those attempts that might result in a premium over the prevailing market price for the shares of common stock held by stockholders.

Authorized but Unissued Capital Stock

Delaware law does not require stockholder approval for any issuance of authorized shares. However, the listing requirements of NASDAQ require stockholder approval of certain issuances equal to or exceeding 20% of the then outstanding voting power or then outstanding number of shares of common stock. These additional shares may be used for a variety of corporate purposes, including future public offerings, to raise additional capital or to facilitate acquisitions.

Our Board of Directors may issue shares of preferred stock on terms calculated to discourage, delay or prevent a change of control of our company or the removal of our management. Moreover, our authorized but unissued shares of preferred stock will be available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans.

One of the effects of the existence of unissued and unreserved common stock or preferred stock may be to enable our Board of Directors to issue shares to persons friendly to current management, which issuance could render more difficult or discourage an attempt to obtain control of our company by means of a merger, tender offer, proxy contest or otherwise, and thereby protect the continuity of our Board of Directors and our management and possibly deprive our stockholders of opportunities to sell their shares of common stock at prices higher than prevailing market prices.

Temporary Classification of our Board of Directors; Size of Our Board of Directors

Our certificate of incorporation provides that, prior to the 2024 annual meeting of stockholders, our Board of Directors will be divided into three classes of directors, with the classes to be as nearly equal in number as possible. Each director elected at the 2021 annual meeting of stockholders has been elected to a three-year term expiring at the 2024 annual meeting of stockholders. Commencing with the 2022 annual meeting of stockholders, directors of the class whose term ends at such annual meeting shall thereafter be elected for a one-year term expiring at the next annual meeting of stockholders. Beginning at the 2024 annual meeting of stockholders, all directors will be elected to one-year terms expiring at the next annual meeting of stockholders. Directors appointed to our Board of Directors before the 2024 annual meeting of stockholders will serve until the next election of the class into which such director shall have been placed. Similarly, any director elected or appointed to fill a vacancy opened by the departure of a director serving a classified term will serve the remainder of the departed director’s term. 

Accordingly, at the 2022 annual meeting of stockholders, the Class II directors or such directors’ successors will be elected for a term expiring at the 2023 annual meeting of stockholders. At the 2023 annual meeting of stockholders, the Class II and III directors or such directors’ successors will be elected to a one-year term expiring at the 2024 annual meeting of stockholders. At the 2024 annual meeting of stockholders, all directors will be elected to a one-year term expiring at the 2025 annual meeting of stockholders. 
2

Our certificate of incorporation and bylaws provide that, subject to any rights of holders of preferred stock to elect additional directors under specified circumstances, the number of directors will be fixed from time to time exclusively pursuant to a resolution adopted by the Board of Directors.

The current classification of our Board of Directors (until the 2024 annual meeting of stockholders) may make it more difficult for our existing stockholders to replace our Board of Directors as well as for another party to obtain control of us by replacing our Board of Directors. Because our Board of Directors has the power to retain and discharge our officers, these provisions could also make it more difficult for existing stockholders or another party to effect a change in management.

Business Combinations

We have opted out of Section 203 of the DGCL; however, our certificate of incorporation contains similar provisions providing that we may not engage in certain “business combinations” with any “interested stockholder” for a three-year period following the time that the stockholder became an interested stockholder, unless:

·      prior to such time, our Board of Directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
·      upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of our voting stock outstanding at the time the transaction commenced, excluding certain shares; or
·      at or subsequent to that time, the business combination is approved by our Board of Directors and by the affirmative vote of holders of at least a majority of the outstanding voting stock that is not owned by the interested stockholder.
·      Generally, a “business combination” includes a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested stockholder. Subject to certain exceptions, an “interested stockholder” is a person who, together with that person’s affiliates and associates, owns, or within the previous three years owned, 15% or more of our voting stock. For purposes of this section only, “voting stock” has the meaning given to it in Section 203 of the DGCL.

Under certain circumstances, this provision makes it more difficult for a person who would be an “interested stockholder” to effect various business combinations with a corporation for a three-year period. This provision may encourage companies interested in acquiring our company to negotiate in advance with our Board of Directors because the stockholder approval requirement would be avoided if our Board of Directors approves either the business combination or the transaction which results in the stockholder becoming an interested stockholder. These provisions also may have the effect of preventing changes in our Board of Directors and may make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best interests.

Removal of Directors; Vacancies

Under the DGCL, unless otherwise provided in our certificate of incorporation, directors serving on a classified board may be removed by the stockholders only for cause and directors serving on a non-classified board may be removed with or without cause, in each case by the affirmative vote of a majority of the outstanding shares entitled to vote at an election of directors. Our certificate of incorporation and bylaws provide that prior to the 2024 annual meeting of the stockholders, any or all of the directors (other than the directors elected by the holders of any series of preferred stock, voting separately as a series or together with one or more other such series, as the case may be) may be removed only for cause and only by the affirmative vote of the holders of a majority in voting power of all the then-outstanding shares of stock entitled to vote generally in the election of directors, voting together as a single class. After the 2024 annual meeting of stockholders, any such director may be removed with or without cause by the affirmative vote of a majority in voting power of all the then-outstanding shares of stock entitled to vote generally in the election of directors, voting as a single class. In addition, our certificate of incorporation and our bylaws also provide that, subject to the rights granted to one or more series of preferred stock then outstanding, any newly created directorship on the Board of Directors that results from an increase in the number of directors and any vacancy occurring on the Board of Directors may only be filled by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director (and not by the stockholders).

Special Stockholder Meetings

Our certificate of incorporation provides that special meetings of our stockholders may be called at any time only by or at the direction of the Board of Directors or the chairman of the Board of Directors. Our bylaws prohibit the conduct of any business at a special meeting other than as specified in the notice for such meeting. These provisions may have the effect of deferring, delaying or discouraging hostile takeovers, or changes in control or management of our company.
3

Requirements for Advance Notification of Director Nominations and Stockholder 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 of Directors or a committee of the Board of Directors. In order for any matter to be “properly brought” before a meeting, a stockholder has to comply with advance notice requirements and provide us with certain information. Generally, to be timely, a stockholder’s notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary date of the immediately preceding annual meeting of stockholders. Our bylaws also specify requirements as to the form and content of a stockholder’s notice.

Our bylaws allow the chairman of the meeting at a meeting of the stockholders to adopt rules and regulations for the conduct of meetings which may have the effect of precluding the conduct of certain business at a meeting if the rules and regulations are not followed. These provisions may defer, delay or discourage a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to influence or obtain control of our company.

Stockholder Action by Written Consent

Our certificate of incorporation precludes stockholder action by written consent.

Amendments to Our Certificate of Incorporation and Bylaws

Our certificate of incorporation and bylaws provide that the Board of Directors is expressly authorized to make, alter, amend, change, add to, rescind or repeal, in whole or in part, our bylaws without a stockholder vote in any matter not inconsistent with the laws of the State of Delaware or our certificate of incorporation. Any amendment, alteration, change, addition, rescission or repeal of our bylaws by our stockholders requires the affirmative vote of the holders of a majority in voting power of all the then-outstanding shares of stock entitled to vote generally in the election of directors, voting together as a single class.

The DGCL provides generally that the affirmative vote of a majority of the outstanding shares entitled to vote thereon, voting together as a single class, is required to amend a corporation’s certificate of incorporation, unless the certificate of incorporation requires a greater percentage. Our certificate of incorporation does not require a greater percentage for any such amendments.

Dissenters’ Rights of Appraisal and Payment

Under the DGCL, with certain exceptions, our stockholders will have appraisal rights in connection with a merger or consolidation of us. Pursuant to the DGCL, stockholders who properly request and perfect appraisal rights in connection with such merger or consolidation will have the right to receive payment of the fair value of their shares as determined by the Delaware Court of Chancery.

Stockholders’ Derivative Actions

Under the DGCL, any of our stockholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the stockholder bringing the action is a holder of our shares at the time of the transaction to which the action relates or such stockholder’s stock thereafter devolved by operation of law.

4

Exclusive Forum 

Our certificate of incorporation provides, subject to limited exceptions, that unless we consent to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (i) derivative action or proceeding brought on behalf of our company, (ii) action asserting a claim of breach of a fiduciary duty owed by any director, officer, or other employee or stockholder of our company to the Company or our stockholders, creditors or other constituents, (iii) action asserting a claim against the Company or any director or officer of the Company arising pursuant to any provision of the DGCL or our certificate of incorporation or our bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) action asserting a claim against the Company or any director or officer of the Company governed by the internal affairs doctrine, in each such case subject to said Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of our company shall be deemed to have notice of and consented to the forum provisions in our certificate of incorporation. However, the enforceability of similar forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be unenforceable.

Conflicts of Interest

Delaware law permits corporations to adopt provisions renouncing any interest or expectancy in certain opportunities that are presented to the corporation or its officers, directors or stockholders. Our certificate of incorporation, to the maximum extent permitted from time to time by Delaware law, renounces any interest or expectancy that we have in, or right to be offered an opportunity to participate in, specified business opportunities that are from time to time presented to our officers, directors or stockholders or their respective affiliates, other than those officers, directors, stockholders or affiliates who are our or our subsidiaries’ employees. Our certificate of incorporation provides that, to the fullest extent permitted by law, any director who is not employed by us (including any non-employee director who serves as one of our officers in both his or her director and officer capacities) or his or her affiliates will have any duty to refrain from (i) engaging in a corporate opportunity in the same or similar lines of business in which we or our affiliates now engage or propose to engage or (ii) otherwise competing with us or our affiliates. In addition, to the fullest extent permitted by law, in the event that any non-employee director acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity for itself or himself or its or his affiliates or for us or our affiliates, such person will have no duty to communicate or offer such transaction or business opportunity to us or any of our affiliates and they may take any such opportunity for themselves or offer it to another person or entity. Our certificate of incorporation does not renounce our interest in any business opportunity that is expressly offered to a non-employee director solely in his or her capacity as a director or officer of the Company. To the fullest extent permitted by law, no business opportunity will be deemed to be a potential corporate opportunity for us unless we would be permitted to undertake the opportunity under our certificate of incorporation, we have sufficient financial resources to undertake the opportunity and the opportunity would be in line with our business.

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00340-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00340-of-00352.parquet"}]]