Extract: Charter Amended/Restated (Plain English Desc) from a DEF 14A on 07/08/2024
DownloadSEC Document
SEC Filing
DownloadPROPOSAL 3
APPROVAL OF AN AMENDMENT TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO REDUCE THE AUTHORIZED CAPITAL STOCK
The Board has approved and submitted for stockholder approval an amendment to our Amended and Restated Certificate of Incorporation to decrease the number of shares of our authorized capital stock to 110,000,000 shares, consisting of 100,000,000 shares of common stock and 10,000,000 shares of preferred stock, or the Authorized Capital Decrease.
Background and Reasons for the Authorized Capital Decrease
Under our Amended and Restated Certificate of Incorporation, we are currently authorized to issue up to 150,000,000 shares of stock, consisting of 100,000,000 shares of voting common stock, 30,000,000 shares of non-voting common stock and 20,000,000 shares of preferred stock. Upon completion of our direct listing of our common stock on The Nasdaq Global Market completed on January 31, 2024, or Direct Listing, all outstanding shares of our non-voting common stock, Series B Preferred Stock and Series B-1 Preferred Stock converted into shares of voting common stock. All outstanding shares of our Series A Preferred Stock were automatically canceled, without the payment of additional consideration by or to the holder thereof in connection with the Direct Listing. As of the close of business on July 1, 2024, there were 35,719,125 shares of voting common stock, no shares of non-voting common stock and 2,500 shares of Series C Preferred Stock issued and outstanding. The Capital Decrease Amendment will update our authorized capital stock to reflect the adjustments to our authorized capital stock completed in connection with the Direct Listing.
Form of Amendment to Amended and Restated Certificate of Incorporation
A form of the certificate of amendment to the Amended and Restated Certificate of Incorporation that would be filed with the Delaware Secretary of State to effect the Authorized Capital Decrease is set forth in Appendix A, or the Capital Decrease Amendment. If the stockholders approve the Capital Decrease Amendment, we intend to file the Capital Decrease Amendment with the Delaware Secretary of State as soon as practicable following the Annual Meeting, and the Capital Decrease Amendment will be effective upon such filing. However, if at any time prior to the effectiveness of the filing of the Capital Decrease Amendment with the Delaware Secretary of State, the Board determines that it would not be in the best interests of our company and stockholders to effect the Authorized Capital Decrease, in accordance with Delaware law and notwithstanding the approval of the stockholders of the Capital Decrease Amendment, the Board may abandon it without further action by the stockholders.
This Proposal 3 and Proposal 4 to approve an amendment to our Amended and Restated Certificate of Incorporation to clarify and eliminate obsolete provisions and make certain other immaterial changes are independent proposals, and one is not contingent on the other. As a result, if only one of this Proposal 3 and Proposal 4 is approved, the Amended and Restated Certificate of Incorporation amendment that was approved may be effected notwithstanding that the other proposal was not approved.
Risks and Effects of the Authorized Share Decrease
We do not foresee any risks with respect to the Authorized Share Decrease. The Authorized Share Decrease will not have any effect on our stock price or market capitalization. Our common stock is currently registered under Section 12(b) of the Securities Exchange Act of 1934, or the Exchange Act, and we are subject to the periodic reporting and other requirements of the Exchange Act. The Authorized Share Decrease will not affect the registration of our common stock under the Exchange Act or our obligation to publicly file financial and other information with the SEC. If the Authorized Share Decrease is implemented, our common stock will continue to trade on The Nasdaq Global Market.
No Appraisal Rights
Stockholders have no rights under the Delaware General Corporation Law, or the DGCL, or under our Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws to exercise dissenters’ rights of appraisal with respect to the Authorized Share Decrease.
The Board Recommends
A Vote In Favor Of Proposal 3.
| 11 |
APPROVAL OF AN AMENDMENT TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION TO CLARIFY AND ELIMINATE OBSOLETE PROVISIONS AND MAKE CERTAIN OTHER IMMATERIAL CHANGES
The Board is proposing certain technical, administrative and immaterial changes, or the Clarifying Amendments, to Articles FOURTH, FIFTH, EIGHTH, NINTH and ELEVENTH of our Amended and Restated Certificate of Incorporation to clarify the Amended and Restated Certificate of Incorporation, remove language rendered obsolete by the Direct Listing, as described below, and make certain other immaterial changes.
Background and Reasons for the Clarifying Amendments
The Amended and Restated Certificate of Incorporation currently includes certain provisions that were applicable prior to the Direct Listing, completed on January 31, 2024. The proposed Clarifying Amendments would delete certain provisions rendered obsolete by the Direct Listing, including language in Articles FOURTH (classes of stock), FIFTH (board classification, director terms) and NINTH (stockholder written consent), as described in more detail below, and make certain other immaterial changes, such as those relating to a prior reverse stock split.
Below is a summary of the changes to the Amended and Restated Certificate of Incorporation proposed pursuant to this Proposal 4:
| ● | Article FOURTH: Removing obsolete language pertaining to completion of an underwritten initial public offering or the direct listing of our common stock on a securities exchange, and the conversion of certain of our equity capital stock in connection therewith. | |
| ● | Article FOURTH: Removing obsolete language pertaining to non-voting common stock, Series A Preferred Stock, Series B Preferred Stock and Series B-1 Preferred Stock, each of which are no longer outstanding following the completion of our Direct Listing. | |
| ● | Article FOURTH: Removing obsolete language related to a reverse stock split that occurred in connection with our Direct Listing. | |
| ● | Article FIFTH: Removing obsolete language pertaining to completion of an initial public offering, or IPO, with respect to classes of directors and terms of office. | |
| ● | Article FIFTH: Adding language to clarify director terms following the Direct Listing. | |
| ● | Article EIGHTH: Removing language providing for indemnification of employees and agents and otherwise clarifying our indemnification obligations. | |
| ● | Article NINTH: Removing obsolete language pertaining to the completion of an IPO as it relates to the ability for stockholders to act by written consent. | |
| ● | Article ELEVENTH: Removing language providing for indemnification of employees and agents. |
The Board believes that the Amended and Restated Certificate of Incorporation should be updated to remove obsolete provisions, add clarifying language and incorporate certain other immaterial modifications that the Board believes will simplify and streamline the document for stockholders. Accordingly, the Board has approved the Clarifying Amendments.
| 12 |
Form of Amendment to Amended and Restated Certificate of Incorporation
A form of the certificate of amendment to the Amended and Restated Certificate of Incorporation that would be filed with the Delaware Secretary of State to effect the Clarifying Amendments is set forth in Appendix B, or the Clarifying Amendment. If the stockholders approve the Clarifying Amendment, we intend to file the Clarifying Amendment with the Delaware Secretary of State as soon as practicable following the Annual Meeting, and the Clarifying Amendment will be effective upon such filing. However, if at any time prior to the effectiveness of the filing of the Clarifying Amendment with the Delaware Secretary of State, the Board determines that it would not be in the best interests of our company and our stockholders to effect the Clarifying Amendment, in accordance with Delaware law and notwithstanding the approval of our stockholders of the Clarifying Amendment, the Board may abandon it without further action by our stockholders.
This Proposal 4 and Proposal 3 to approve an amendment to our Amended and Restated Certificate of Incorporation to reduce our authorized capital stock are independent proposals, and one is not contingent on the other. As a result, if only one of this Proposal 4 and Proposal 3 is approved, the Amended and Restated Certificate of Incorporation amendment that was approved may be effected notwithstanding that the other proposal was not approved.
Risks and Effects of the Clarifying Amendments
The Clarifying Amendments set forth in this Proposal 5 are administrative and will not have a substantive impact on your rights as a stockholder of our company.
No Appraisal Rights
Stockholders have no rights under the DGCL or under our Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws to exercise dissenters’ rights of appraisal with respect to the Clarifying Amendments.
The Board Recommends
A Vote In Favor Of Proposal 4.