Document:

Exhibit 10.5

 

MCAP Acquisition Corporation

311 South Wacker Drive, Suite 6400

Chicago, Illinois 60606

 

December 21, 2020

 

MCAP Acquisition, LLC

311 South Wacker Drive, Suite 6400

Chicago, Illinois 60606

 

RE: Securities Subscription Agreement

 

Ladies and Gentlemen:

 

We are pleased to accept the offer MCAP Acquisition, LLC (the
 “Subscriber” or “you”) has made to purchase 7,187,500 shares of Class B common stock
(the “Shares”), $0.0001 par value per share (the “Class B Common Stock” together with
all other classes of Company (as defined below) common stock, the “Common Stock”), up to 937,500 Shares of which
are subject to complete or partial forfeiture by you if the underwriters of the initial public offering (“IPO”)
of MCAP Acquisition Corporation, a Delaware corporation (the “Company”), do not fully exercise their over-allotment
option (the “Over-allotment Option”). The terms (this “Agreement”) on which the Company is
willing to sell the Shares to the Subscriber, and the Company and the Subscriber’s agreements regarding such Shares, are
as follows:

 

1. Purchase of Shares. For the sum of $25,000 (the “Purchase
Price”), which the Company acknowledges receiving in cash, the Company hereby sells and issues the Shares to the Subscriber,
and the Subscriber hereby purchases the Shares from the Company, subject to the forfeiture provisions of Section 3 below,
on the terms and subject to the conditions set forth in this Agreement. Concurrently with the Subscriber’s execution of this
Agreement, the Company is delivering to the Subscriber a certificate registered in the Subscriber’s name representing the
Shares (the “Original Certificate”), receipt of which the Subscriber hereby acknowledges.

 

2. Representations, Warranties and Agreements.

 

2.1 Subscriber’s Representations,
Warranties and Agreements. To induce the Company to issue the Shares to the Subscriber, the Subscriber hereby represents and
warrants to the Company and agrees with the Company as follows:

 

2.1.1 No Government Recommendation or Approval.
The Subscriber understands that no federal or state agency has passed upon or made any recommendation or endorsement of the offering
of the Shares.

 

2.1.2 No Conflicts. The execution,
delivery and performance of this Agreement and the consummation by the Subscriber of the transactions contemplated hereby do not
violate, conflict with or constitute a default under (i) the formation and governing documents of the Subscriber, (ii) any
agreement, indenture or instrument to which the Subscriber is a party, (iii) any law, statute, rule or regulation to
which the Subscriber is subject, or (iv) any agreement, order, judgment or decree to which the Subscriber is subject.

 

     

     

    

 

2.1.3 Organization and Authority. The
Subscriber is a Delaware limited liability company, validly existing and in good standing under the laws of Delaware and possesses
all requisite power and authority necessary to carry out the transactions contemplated by this Agreement. Upon execution and delivery
by you, this Agreement will be a legal, valid and binding agreement of Subscriber, enforceable against Subscriber in accordance
with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar
laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of
whether enforcement is sought in a proceeding at law or in equity).

 

2.1.4 Experience, Financial Capability
and Suitability. Subscriber is: (i) sophisticated in financial matters and is able to evaluate the risks and benefits
of the investment in the Shares and (ii) able to bear the economic risk of its investment in the Shares for an indefinite
period of time because the Shares have not been registered under the Securities Act (as defined below) and therefore cannot be
resold unless subsequently registered under the Securities Act or an exemption from such registration is available. Subscriber
is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests.
Subscriber must bear the economic risk of this investment until the Shares are sold pursuant to: (x) an effective registration
statement under the Securities Act or (y) an exemption from registration available with respect to such sale. Subscriber is
able to bear the economic risks of an investment in the Shares and to afford a complete loss of Subscriber’s investment in
the Shares.

 

2.1.5 Access to Information; Independent
Investigation. Prior to the execution of this Agreement, the Subscriber has had the opportunity to ask questions of and receive
answers from representatives of the Company concerning an investment in the Company, as well as the finances, operations, business
and prospects of the Company, and the opportunity to obtain additional information to verify the accuracy of all information so
obtained. In determining whether to make this investment, Subscriber has relied solely on Subscriber’s own knowledge and
understanding of the Company and its business based upon Subscriber’s own due diligence investigation and the information
furnished pursuant to this paragraph. Subscriber understands that no person has been authorized to give any information or to make
any representations which were not furnished pursuant to this Section 2 and Subscriber has not relied on any other representations
or information in making its investment decision, whether written or oral, relating to the Company, its operations or its prospects.

 

2.1.6 Accredited Investor. The Subscriber
represents that it is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D under
the Securities Act of 1933, as amended (the “Securities Act”) and acknowledges the sale contemplated hereby
is being made in reliance on a private placement exemption under federal and state law.

 

2.1.7 Investment Purposes. The Subscriber
is purchasing the Shares solely for investment purposes, for the Subscriber’s own account and not for the account or benefit
of any other person, and not with a view towards the distribution or dissemination thereof that would result in a violation of
the Securities Act. The Subscriber did not enter into this Agreement as a result of any general solicitation or general advertising
within the meaning of Rule 502 of Regulation D under the Securities Act.

 

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2.1.8 Restrictions on Transfer; Shell
Company. The Subscriber understands the Shares are being offered in a transaction not involving a public offering within the
meaning of the Securities Act. Subscriber understands the Shares will be “restricted securities” as defined in Rule 144(a)(3) under
the Securities Act and Subscriber understands that the certificate representing the Shares will contain a legend in respect of
such restrictions. If in the future the Subscriber decides to offer, resell, pledge or otherwise transfer the Shares, such Shares
may be offered, resold, pledged or otherwise transferred only in accordance with the provisions of Section 5 hereof. Subscriber
agrees that if any transfer of its Shares or any interest therein is proposed to be made, as a condition precedent to any such
transfer, Subscriber may be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration
or an exemption, the Subscriber agrees not to offer, resell, pledge or otherwise transfer the Shares. Subscriber further acknowledges
that because the Company is a shell company, Rule 144 may not be available to the Subscriber for the resale of the Shares
until one year following consummation of the initial business combination of the Company, despite technical compliance with the
certain requirements of Rule 144 and the release or waiver of any contractual transfer restrictions.

 

2.1.9 No Governmental Consents. No
governmental, administrative or other third party consents or approvals are required, necessary or appropriate on the part of Subscriber
in connection with the transactions contemplated by this Agreement.

 

2.2 Company’s Representations,
Warranties and Agreements. To induce the Subscriber to purchase the Shares, the Company hereby represents and warrants to the
Subscriber and agrees with the Subscriber as follows:

 

2.2.1 Organization and Corporate Power.
The Company is a Delaware corporation and is qualified to do business in every jurisdiction in which the failure to so qualify
would reasonably be expected to have a material adverse effect on the financial condition, operating results or assets of the Company.
The Company possesses all requisite corporate power and authority necessary to carry out the transactions contemplated by this
Agreement.

 

2.2.2 No Conflicts. The execution,
delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby do not violate,
conflict with or constitute a default under (i) the Certificate of Incorporation or Bylaws of the Company, (ii) any agreement,
indenture or instrument to which the Company is a party, (iii) any law, statute, rule or regulation to which the Company
is subject, or (iv) any agreement, order, judgment or decree to which the Company is subject.

 

2.2.3 Title to Securities. Upon issuance
in accordance with, and payment pursuant to, the terms hereof, the Shares will be duly and validly issued, fully paid and nonassessable.
Upon issuance in accordance with, and payment pursuant to, the terms hereof the Subscriber will have or receive good title to the
Shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer restrictions hereunder and
other agreements to which the Shares may be subject which have been notified to the Subscriber in writing, (b) transfer restrictions
under federal and state securities laws, and (c) liens, claims or encumbrances imposed due to the actions of the Subscriber.

 

2.2.4 No Adverse Actions. There are
no actions, suits, investigations or proceedings pending, threatened against or affecting the Company which: (i) seek to restrain,
enjoin, prevent the consummation of or otherwise affect the transactions contemplated by this Agreement or (ii) question the
validity or legality of any transactions or seek to recover damages or to obtain other relief in connection with any transactions.

 

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3. Forfeiture of Shares.

 

3.1 Partial or No Exercise of the Over-allotment
Option. In the event the Over-allotment Option granted to the representative of the underwriters of the IPO is not exercised
in full, the Subscriber acknowledges and agrees that it (and, if applicable, any transferee of Shares) shall forfeit any and all
rights to such number of Shares (up to an aggregate of 937,500 Shares and pro rata based upon the percentage of the Over-allotment
Option exercised) such that immediately following such forfeiture, the Subscriber (and any such transferees) will own an aggregate
number of Shares (not including Shares issuable upon exercise of any warrants or any Common Stock purchased by Subscriber in the
IPO or in the aftermarket) equal to 20% of the issued and outstanding Common Stock immediately following the IPO.

 

3.2 Termination of Rights as Stockholder.
If any of the Shares are forfeited in accordance with this Section 3, then after such time the Subscriber (or successor in
interest), shall no longer have any rights as a holder of such Shares, and the Company shall take such action as is appropriate
to cancel such Shares.

 

3.3 Share Certificates. In the event
an adjustment to the Original Certificate is required pursuant to this Section 3, then the Subscriber shall return such Original
Certificate to the Company or its designated agent as soon as practicable upon its receipt of notice from the Company advising
Subscriber of such adjustment, following which a new certificate (the “New Certificate”) shall be issued in
such amount representing the adjusted number of Shares held by the Subscriber. The New Certificate shall be returned to the Subscriber
as soon as practicable.

 

4. Waiver of Liquidation Distributions; Redemption Rights.
In connection with the Shares purchased pursuant to this Agreement, the Subscriber hereby waives any and all right, title, interest
or claim of any kind in or to any distributions by the Company from the trust account which will be established for the benefit
of the Company’s public stockholders and into which substantially all of the proceeds of the IPO will be deposited (the “Trust
Account”), in the event of a liquidation of the Company upon the Company’s failure to timely complete an initial
business combination. For purposes of clarity, in the event the Subscriber purchases Common Stock in the IPO or in the aftermarket,
any additional Common Stock so purchased shall be eligible to receive any liquidating distributions by the Company. However, in
no event will the Subscriber have the right to redeem any Shares into funds held in the Trust Account upon the successful completion
of an initial business combination.

 

5. Restrictions on Transfer.

 

5.1 Securities Law Restrictions.
In addition to any restrictions to be contained in that certain letter agreement (commonly known as an “Insider Letter”)
to be dated as of the closing of the IPO by and between Subscriber and the Company, Subscriber agrees not to sell, transfer, pledge,
hypothecate or otherwise dispose of all or any part of the Shares unless, prior thereto (a) a registration statement on the
appropriate form under the Securities Act and applicable state securities laws with respect to the Shares proposed to be transferred
shall then be effective or (b) the Company has received an opinion from counsel reasonably satisfactory to the Company, that
such registration is not required because such transaction is exempt from registration under the Securities Act and the rules promulgated
by the Securities and Exchange Commission thereunder and with all applicable state securities laws.

 

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5.2 Lock-up. Subscriber acknowledges
that the Shares will be subject to lock-up provisions contained in the Insider Letter.

 

5.3 Restrictive Legends. All certificates
representing the Shares shall have endorsed thereon legends substantially as follows: “THE SECURITIES REPRESENTED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES
NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN
THE OPINION OF COUNSEL, IS AVAILABLE. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO LOCKUP PROVISIONS AND
MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE TERM OF THE LOCKUP PERIOD.”

 

5.4 Additional Shares or Substituted
Securities. In the event of the declaration of a stock dividend, the declaration of a special dividend payable in a form other
than Common Stock, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting
the Company’s outstanding Common Stock without receipt of consideration, any new, substituted or additional securities or
other property which are by reason of such transaction distributed with respect to any Shares subject to this Section 5 or
into which such Shares thereby become convertible shall immediately be subject to this Section 5 and Section 3. Appropriate
adjustments to reflect the distribution of such securities or property shall be made to the number or class of Shares subject to
this Section 5 and Section 3.

 

5.5 Registration Rights. The Subscriber
acknowledges that the Shares are being purchased pursuant to an exemption from the registration requirements of the Securities
Act and will become freely tradable only after certain conditions are met or they are registered pursuant to a Registration Rights
Agreement to be entered into with the Company prior to the closing of the IPO.

 

6. Other Agreements.

 

6.1 Further Assurances. The Subscriber
agrees to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent
of this Agreement.

 

6.2 Notices. All notices, statements
or other documents which are required or contemplated by this Agreement shall be in writing and delivered: (i) personally
or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address
designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number
as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently provided
to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication
so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following
receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an
overnight courier service or five (5) days after mailing if sent by mail.

 

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6.3 Entire Agreement. This Agreement,
together with that certain Insider Letter to be entered into between Subscriber and the Company, substantially in the form to be
filed as an exhibit to the Registration Statement, embodies the entire agreement and understanding between the Subscriber and the
Company with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating
to the subject matter hereof. No statement, representation, warranty, covenant or agreement of any kind not expressly set forth
in this Agreement shall affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.

 

6.4 Modifications and Amendments.
The terms and provisions of this Agreement may be modified or amended only by written agreement executed by all parties hereto.

 

6.5 Waivers and Consents. The terms
and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by written document executed
by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute
a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or
consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not constitute a
continuing waiver or consent.

 

6.6 Assignment. The rights and obligations
under this Agreement may not be assigned by either party hereto without the prior written consent of the other party.

 

6.7 Benefit. All statements, representations,
warranties, covenants and agreements in this Agreement shall be binding on the parties hereto and shall inure to the benefit of
the respective successors and permitted assigns of each party hereto. Nothing in this Agreement shall be construed to create any
rights or obligations except among the parties hereto, and no person or entity shall be regarded as a third-party beneficiary of
this Agreement.

 

6.8 Governing Law. This Agreement
and the rights and obligations of the parties hereunder shall be construed in accordance with and governed by the laws of Illinois
applicable to contracts wholly performed within the borders of such state, without giving effect to the conflict of law principles
thereof. The parties hereto irrevocably submit to the exclusive jurisdiction of any federal court sitting in the Northern District
of Illinois or any state court located in Cook County, State of Illinois, over any suit, action or proceeding arising out of or
relating to this Agreement. To the fullest extent they may effectively do so under applicable law, the parties hereto irrevocably
waive and agree not to assert, by way of motion, as a defense or otherwise, any claim that they are not subject to the jurisdiction
of any such court, any objection that they may now or hereafter have to the laying of the venue of any such suit, action or proceeding
brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in
an inconvenient forum.

 

6.9 Severability. In the event that
any court of competent jurisdiction shall determine that any provision, or any portion thereof, contained in this Agreement shall
be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent that such court deems
it reasonable and enforceable, and as so limited shall remain in full force and effect. In the event that such court shall deem
any such provision, or portion thereof, wholly unenforceable, the remaining provisions of this Agreement shall nevertheless remain
in full force and effect.

 

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6.10 No Waiver of Rights, Powers and
Remedies. No failure or delay by a party hereto in exercising any right, power or remedy under this Agreement, and no course
of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or
partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of
steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the
right of such party to pursue other available remedies. No notice to or demand on a party not expressly required under this Agreement
shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the rights of the party giving such notice or demand to any other or further action in any circumstances
without such notice or demand.

 

6.11 Survival of Representations and
Warranties. All representations and warranties made by the parties hereto in this Agreement or in any other agreement, certificate
or instrument provided for or contemplated hereby, shall survive the execution and delivery hereof and any investigations made
by or on behalf of the parties.

 

6.12 No Broker or Finder. Each of
the parties hereto represents and warrants to the other that no broker, finder or other financial consultant has acted on its behalf
in connection with this Agreement or the transactions contemplated hereby in such a way as to create any liability on the other.
Each of the parties hereto agrees to indemnify and hold the other harmless from any claim or demand for commission or other compensation
by any broker, finder, financial consultant or similar agent claiming to have been employed by or on behalf of such party and to
bear the cost of legal expenses incurred in defending against any such claim.

 

6.13 Headings and Captions. The headings
and captions of the various sections of this Agreement are for convenience of reference only and shall in no way modify or affect
the meaning or construction of any of the terms or provisions hereof.

 

6.14 Counterparts. This Agreement
may be executed in one or more counterparts, all of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that
both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or any
other form of electronic delivery, such signature shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.

 

6.15 Construction. The words “include,”
 “includes,” and “including” will be deemed to be followed by “without limitation.”
Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form
will be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,”
 “herein,” “hereof,” “hereby,” “hereunder,” and words
of similar import refer to this Agreement as a whole and not to any particular section unless expressly so limited. The parties
hereto intend that each representation, warranty, and covenant contained herein will have independent significance. If any party
hereto has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another
representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which
such party hereto has not breached will not detract from or mitigate the fact that such party hereto is in breach of the first
representation, warranty, or covenant.

 

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6.16 Mutual Drafting. This Agreement
is the joint product of the Subscriber and the Company and each provision hereof has been subject to the mutual consultation, negotiation
and agreement of such parties and shall not be construed for or against any party hereto.

 

7. Voting and Redemption of Shares. The Subscriber agrees
to vote the Shares in favor of an initial business combination that the Company negotiates and submits for approval to the Company’s
stockholders and shall not seek redemption with respect to such Shares. Additionally, the Subscriber agrees not to redeem any Shares
in connection with a redemption or tender offer presented to the Company’s stockholders in connection with an initial business
combination negotiated by the Company.

 

8. Indemnification. Each party shall indemnify (such
party, the “Indemnifying Party”) the other party (such party, the “Indemnified Party”) and
its respective officers, employees, and controlling persons to the fullest extent permitted by law from and against any and all
losses, damages, expenses (including reasonable attorneys’ fees and expenses) or other liabilities resulting from or arising
out of such party’s breach of any representation, warranty, covenant or agreement in this Agreement. The foregoing indemnification
rights apply so long as the action or failure to act by the Indemnified Party does not constitute fraud, bad faith, willful misconduct
or gross negligence. Notwithstanding any of the foregoing to the contrary, indemnification protections will not be construed so
as to relieve (or attempt to relieve) any Indemnified Party of any liability (including liability under federal securities laws
which, under certain circumstances, impose liability even on persons that act in good faith), to the extent (but only to the extent)
that such liability may not be waived, modified or limited under applicable law, but will only be construed so as to effectuate
the indemnification protections to the fullest extent permitted by law.

 

[Signature Page Follows]

 

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If the foregoing accurately sets forth our understanding and
agreement, please sign the enclosed copy of this Agreement and return it to us.

 

	 	Very truly yours,
	 	 	 
	 	MCAP Acquisition Corporation
	 	 	 
	 	By:	/s/ Scott Marienau
	 	Name:	Scott Marienau
	 	Title:	Chief Financial Officer

 

Accepted and agreed this 21st day of December, 2020:

 

	
        MCAP Acquisition, LLC

         

        By: Monroe Capital Management Advisors, LLC

         

        Manager
	 
	 	 	 
	By:	/s/ Peter Gruszka	 
	Name:	Peter Gruszka	 
	Title:	General Counsel and Managing Director	 

 

[Signature Page
to Subscription Agreement]Document

EXHIBIT 4.4

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

As of December 31, 2020, FirstCash, Inc. (the “Company,” “us,” “we,” or “our”) had one class of securities, our common stock, par value $0.01 per share, registered under Section 12 of the Securities Exchange Act of 1934, as amended.

Description of Common Stock

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 amended and restated certificate of incorporation and our amended and restated bylaws, which are filed as exhibits to our Annual Report on Form 10-K and are incorporated by reference herein, as well as the applicable provisions of the Delaware General Corporation Law. We encourage you to carefully review our amended and restated certificate of incorporation, our amended and restated bylaws and the applicable provisions of the Delaware General Corporation Law, for additional information.

General

Our authorized capital stock consists of 90,000,000 shares of common stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, par value $0.01 per share. 

Voting Rights

Each share of our common stock is entitled to one vote per share of record on all matters to be voted upon by our stockholders. Generally, a matter submitted for stockholder action shall be decided by the affirmative vote of a majority of the shares present in person or represented by proxy at the meeting and entitled to vote thereon.  Other than in a contested election where directors are elected by a plurality vote, each nominee for director shall be elected by the vote of the majority of the votes cast, in person or by proxy, with respect to the director nominee at the meeting.  

Dividends

Subject to the preferential rights of the holders of any preferred stock that may at the time be outstanding, each share of common stock will entitle the holder of that share to an equal and ratable right to receive dividends or other distributions if declared from time to time by our board of directors and if there are sufficient funds to legally pay a dividend.

Rights Upon Liquidation

In the event of the Company’s liquidation, dissolution or winding up, whether voluntary or involuntary, the holders of our common stock will be entitled to share ratably in all assets remaining after payments to creditors and after satisfaction of the liquidation preference, if any, of the holders of any preferred stock that may at the time be outstanding. 

Other Rights

Holders of our common stock have no preemptive or redemption rights and will not be subject to further calls or assessments by the Company. 

Preferred Stock

The authorized preferred stock will be available for issuance from, time to time, at the discretion of our board of directors without stockholder approval. Our board of directors has the authority to prescribe for each series of preferred stock it establishes the number of shares in that series, the number of votes, if any, to which the shares in that series are entitled, the consideration for the shares in that series and the powers, designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, of the shares in that series. Depending upon the rights prescribed for a series of preferred stock, the issuance of preferred stock could have an adverse effect on the voting power of 

the holders of our common stock and could adversely affect holders of our common stock by delaying or preventing a change in control of the Company, making removal of the Company’s management more difficult or imposing restrictions upon the payment of dividends and other distributions to the holders of our common stock.

Certain Provisions That May Have an Anti-Takeover Effect

Certain other provisions of our amended and restated certificate of incorporation and amended and restated bylaws may delay or make more difficult unsolicited acquisitions or changes of control of the Company. These provisions could have the effect of discouraging third parties from making proposals involving an unsolicited acquisition or change in control of the Company, although these proposals, if made, might be considered desirable by a majority of the Company’s stockholders. These provisions may also have the effect of making it more difficult for third parties to cause the replacement of the current management without the concurrence of our board of directors. These provisions include:

•The division of our board of directors into three classes serving staggered terms of office of three years. With a classified board of directors, it would generally take a majority stockholder two annual meetings of stockholders to elect a majority of the board of directors. As a result, a classified board may discourage proxy contests for the election of directors or purchases of a substantial block of stock because it could operate to prevent obtaining control of the board in a relatively short period of time.

•A prohibition of stockholder action by written consent of stockholders. Action by written consent may, in some circumstances, permit the taking of stockholders’ action opposed by the board of directors more rapidly than would be possible if a meeting of stockholders were required. The prohibition contained in the amended and restated certificate of incorporation will restrict the ability of controlling stockholders to take action at any time other than at an annual meeting and will generally force a takeover bidder to negotiate directly with the board of directors.

•Permitting only the Company’s board of directors, a duly authorized committee of the board of directors, the chairman or the vice chairman of our board of directors or the chief executive officer to call a special meeting of the Company’s stockholders. This provision could prevent a stockholder from, among other things, calling a special meeting of stockholders to consider the stockholder’s proposed slate of directors or a transaction that might result in a change of control of the corporation.

•An advance notice procedure with regard to stockholder nomination of candidates for election as directors and other business to be brought before an annual meeting of our stockholders. Although our amended and restated bylaws will not give our board of directors any power to approve or disapprove stockholder nominations for the election of directors or other proposals for action, these advance notice procedures may have the effect of precluding a contest for the election of directors or the consideration of other stockholder proposals if the established procedures are not followed and of discouraging or deterring a third party from conducting a solicitation of proxies to elect its own slate of directors or to approve another proposal without regard to whether consideration of those nominees or proposals might be harmful or beneficial to the Company and our stockholders.

•Elimination, subject to certain exceptions, of the personal liability of directors of the Company for monetary damages for breaches of fiduciary duty by such directors. The amended and restated certificate of incorporation will not provide for the elimination of or any limitation on the personal liability of a director for (i) any breach of the director’s duty of loyalty to the Company or its stockholders, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) unlawful corporate distributions, or (iv) any transaction from which such director derives an improper personal benefit. This provision of the amended and restated certificate of incorporation will limit the remedies available to a stockholder who is dissatisfied with a decision of the board of directors protected by this provision, and such stockholder’s only remedy in that circumstance may be to bring a suit to prevent the action of the board. In many situations, this remedy may not be effective, as for example when stockholders are not aware of a transaction or an event prior to board action in respect of such transaction or event. In these cases, the stockholders and the corporation could be injured by the board’s decision and have no effective remedy.

•Permitting the removal of directors only for cause by a vote of the holders of a majority of the outstanding shares of stock entitled to vote in an election of directors.

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•Permitting the board of directors, in evaluating any takeover offer, to consider all relevant factors, including the potential economic and social impact of the offer on our stockholders, employees, customers, creditors, the communities in which the Company operates and any other factors the directors consider pertinent. Once the board, in exercising its business judgment, has determined that a proposed action is not in the best interests of the Company, it has no duty to remove any barriers to the success of the action, including a shareholder rights plan.

Section 203 of the Delaware General Corporation Law

The Company is subject to Section 203 (“Section 203”) of the DGCL, which, subject to certain exceptions, prohibits a Delaware corporation from engaging in any business combinations with any interested stockholder for a period of three years following the date that such stockholder became an interested stockholder, unless (i) before such date the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder, (ii) upon consummation of the transaction that 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 number of shares outstanding those shares owned (x) by persons who are directors and also officers and (y) by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer, or (iii) on or after such date the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 defines business combination to include (i) any merger or consolidation involving the corporation and the interested stockholder, (ii) any sale, lease, exchange, mortgage, transfer, pledge or other disposition involving the interested stockholder of 10% or more of assets of the corporation, (iii) subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder, (iv) 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 or (v) 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. In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by such an entity or person.

Section 203 may delay, prevent or make more difficult certain unsolicited acquisitions, tender offers or changes of control of the Company and also may have the effect of preventing changes in our management. It is possible that these provisions could make it more difficult to accomplish transactions which our stockholders may otherwise deem to be in their best interest.
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