EX-4.1 2 egy-20191231xex4_1.htm EX-4.1

Exhibit 4.1

DESCRIPTION OF SECURITIES

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The following description sets forth certain material terms and provisions of our securities that are registered under Section 12 of the Securities Exchange Act of 1934, as amended. This description also summarizes relevant provisions of Delaware law. The following summary does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the applicable provisions of Delaware law and our certificate of incorporation and our bylaws, copies of which are incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit 4.1 is a part. In addition, you should be aware that the summary below does not give full effect to the terms of the provis ions of statutory or common law, and w e encourage you to read our certificate of incorporation, our bylaws and the applicable provisions of Delaware law for additional information.

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Description of Capital Stock

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Common Stock

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We are currently authorized to issue up to 100,000,000 shares of common stock, par value $0.10 per share. As of March 3, 20 20, there were 57,978,990 shares of common stock outstanding. Holders of our common stock are entitled to cast one vote for each share held of record on each matter submitted to a vote of stockholders. There is no cumulative voting for election of directors. Subject to the prior rights of any series of preferred stock which may from time to time be outstanding, if any, holders of our common stock are entitled to receive ratably dividends when, as and if declared by the board of directors out of funds legally available for such purpose and, upon the liquidation, dissolution or winding up of the company, are entitled to share ratably in all assets remaining after payment of liabilities and payment of accrued dividends and liquidation preferences on the preferred stock, if any. There are no redemption or sinking fund provisions that are applicable to our common stock. Subject only to the requirements of the Delaware General Corporation Law, or DGCL, the board of directors may issue shares of our com mon stock without stockholder approval, at any time and from time to time, to such persons and for such consideration as the board of directors deems appropriate. Holders of our common stock have no preemptive rights and have no rights to convert their common stock into any other securities. The outstanding common stock is validly authorized and issued, fully paid and nonassessable.

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Preferred Stock

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We are authorized to issue up to 500,000 shares of preferred stock, par value $25.00 per share. As of March 3, 2020, there were no shares of preferred stock outstanding. Shares of preferred stock may be issued from time to time in one or more series as the board of directors may from time to time determine, each of said series to be distinctively designated. The voting powers, preferences and relative, participating, optional and other special rights, and the qualifications, limitations or restrictions thereof, if any, of each such series of preferred stock may differ from those of any and all other series of preferred stock at any time outstanding, and, subject to certain limitations of our certificate of incorporation and the DGCL, the board of directors may fix or alter, by resolution or resolutions, the designation, number, voting powers, preferences and relative, participating, optional and other special rights, and qualifications, limitations and restrictions thereof, of each such series of preferred stock.

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The authority of the b oard of directors with respect to each series shall include, but not be limited to, determination of the following:

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| · |  | t he number of shares constituting that series and the distinctive designation of that series;

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| · |  | t he dividend rate on the shares of that series, whether dividends shall be cumulative, and if so, from which date or dates, and the relative rights of priority, if any, of payment of dividends on shares of that series;

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| · |  | w hether that series shall have voting rights, in addition to the voting rights provided by law, and, if so, the terms of such voting rights;

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| · |  | w hether that series shall have conversion privileges, and, if so, the terms and conditions of such conversion, including provision for adjustment of the convers ion rate in such events as the b oard of d irectors shall determine;

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| · |  | w hether or not the shares of that series shall be redeemable, and, if so, the terms and conditions of such redemption, including the date or date upon or after which they shall be redeemable, and the amount per share payable in case of redemption, which amount may vary under different conditions and at different redemption dates;

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| · |  | w hether that series shall have a sinking fund for the redemption or purchase of shares of that series, and, if so, the terms and amount of such sinking fund;

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| · |  | t he rights of the shares of that series in the event of voluntary or involuntary liquidation, dissolution or winding up of the corporation, and the relative rights of priority, if any, of payment of shares of that series; and

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| · |  | a ny other relative rights, preferences and limitations of that series.

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The issuance of any such preferred stock by our board of directors could adversely affect the rights of the holders of our common stock and therefore, reduce the value of the common stock. The ability of the board of directors to issue preferred stock could discourage, delay, or prevent a takeover of us.

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Anti-Takeover Effects of Provisions of Our Certificate of Incorporation and Our Bylaws

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Our Restated Certificate of Incorporation, Bylaws and Delaware law contain several provisions that may make the acquisition of control of us by means of a tender offer, open market purchases, a proxy fight, or otherwise more difficult.

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Delaware Law

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Section 203 of the Delaware General Corporation Law restricts certain transactions between a corporation organized under Delaware law or its majority-owned subsidiaries and any person, referred to as an interested stockholder, holding 15% or more of the corporation’s outstanding voting stock, together with the affiliates or associates of such person. Section 203 prevents, for a period of three years following the date that a person becomes an interested stockholder, the following types of transactions between the corporation and the interested stockholder, unless certain conditions, described below, are met:

| · |  | mergers or consolidations;

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| · |  | sales, leases, exchanges or other transfers of 10% or more of the aggregate assets of the corporation;

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| · |  | issuances or transfers by the corporation of any stock of the corporation which would have the effect of increasing the interested stockholder’s proportionate share of the stock of any class or series of the corporation;

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| · |  | any other transaction which has the effect of increasing the proportionate share of the stock of any class or series of the corporation which is owned by the interested stockholder; and

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| · |  | receipt by the interested stockholder of the benefit, except proportionately as a stockholder, of loans, advances, guarantees, pledges or other financial benefits provided by the corporation.

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The three-year ban does not apply if either the proposed transaction or the transaction by which the interested stockholder became an interested stockholder is approved by the board of directors of the corporation prior to the date such stockholder becomes an interested stockholder. Additionally, an interested stockholder may avoid the statutory restriction if, upon the consummation of the transaction whereby such stockholder becomes an interested stockholder, the stockholder owns at least 85% of the outstanding voting stock of the corporation without regard to

those shares owned by the corporation’s officers and directors or certain employee stock plans. Business combinations are also permitted within the three-year period if approved by the board of directors and authorized at an annual or special meeting of stockholders by the holders of at least 66 2/3% of the outstanding voting stock not owned by the interested stockholder. In addition, any transaction is exempt from the statutory ban if it is proposed at a time when the corporation has proposed, and a majority of certain continuing directors of the corporation have approved, a transaction with a party who is not an interested stockholder of the corporation, or who becomes such with board approval, if the proposed transaction involves:

| · |  | certain mergers or consolidations involving the corporation;

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| · |  | a sale or other transfer of over 50% of the aggregate assets of the corporation; or

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| · |  | a tender or exchange offer for 50% of more of the outstanding voting stock of the corporation.

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A corporation may, at its option, exclude itself from the coverage of Section 203 by amending its certificate of incorporation or bylaws by action of its stockholders to exempt itself from coverage, provided that such bylaw or charter amendment shall not become effective until 12 months after the date it is adopted. We have not adopted such a charter or bylaw amendment.

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Board of Directors

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Number of Directors. Our Bylaws provide that the number of directors shall be not less than three nor more than 15, the exact number to be fixed from time to time by our b oard of directors. Vacancies in the b oard of directors or newly created directorships resulting from an increase in the number of directors may be filled by a majority of the remaining directors. Accordingly, our b oard of directors could prevent any stockholder from obtaining majority representation on our b oard of directors by enlarging the size of the b oard of directors and filling the new directorships with the b oard of directors’ own nominees.

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Removal of Directors. Our Restated Certificate of Incorporation and Bylaws provide that a director may be removed only for cause. “Cause” is defined to exist only if the director has been (1) convicted of a felony, adjudicated to be liable for gross negligence, recklessness or misconduct in the performance of his or her duty to us in a manner of substantial importance to us, or adjudicated to be mentally incompetent, which mental incompetency directly affects his or her ability as one of our directors; and (2) such conviction or adjudication was made by a court of competent jurisdiction and is no longer subject to appeal.

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Certain Voting Requirements in Our Restated Certificate and Bylaws

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Amendment of Restated Certificate of Incorporation. The affirmative vote of the holders of at least 66 2/3% of the voting power of all our outstanding voting shares is required to alter, amend, adopt any provision inconsistent with, or repeal the provisions of our Restated Certificate of Incorporation relating to the election, removal and classification of directors and amendment of our Bylaws.

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Amendments to Bylaws. Our Restated Certificate of Incorporation and Bylaws further provide that the b oard of directors has the power to make, alter, amend and repeal our Bylaws, except so far as bylaws adopted by our stockholders otherwise provide. Notwithstanding the foregoing, our Bylaws may not be altered, amended or repealed, and no provision inconsistent therewith may be adopted, by action of the stockholders without the affirmative vote of at least 66 2/3% of the voting power of all our outstanding shares.

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Supermajority Vote for Certain Transactions. Under Delaware law, and subject to certain exceptions, unless a greater vote is required in the corporation’s certificate of incorporation, a merger, consolidation or dissolution of a corporation may be approved by a majority vote of the outstanding stock of the corporation entitled to vote thereon. Our Restated Certificate of Incorporation contains provisions that require the approval of holders of at least 80% of the voting power of the then outstanding shares of our capital stock entitled to vote as a condition for any of the following actions:

| · |  | a merger or consolidation;

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| · |  | a share exchange;

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| · |  | the adoption of any plan or proposal for liquidation, dissolution or reorganization; and

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| · |  | a sale, lease or other disposition of all or substantially all of our assets on a consolidated basis.

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The 80% voting requirement is not applicable if such action is approved by a majority of our “continuing directors” prior to the transaction. The term “continuing director” is defined to mean:

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| · |  | any member of our b oard of directors as of December 31, 1992;

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| · |  | any new director who is proposed to be a director of ours by a majority of the co ntinuing directors then on the b oard of directors; and

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| · |  | any successor of a continuing director who is recommended to succeed a continuing director by a majority of the continui ng directors then on the b oard of directors.

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The affirmative vote of the holders of at least 80% of the voting power of all our outstanding voting shares is required to amend, repeal, or adopt any provisions inconsistent with, the provisions of our Restated Certificate of Incorporation described in this paragraph.

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Advance Notice Procedure for Stockholder Proposals. Our Bylaws establish an advance notice procedure for the nomination of candidates for election as directors, as well as for stockholder proposals considered at annual meetings of stockholders. These procedures may operate to limit the ability of stockholders to bring business before a stockholders’ meeting, including with respect to the nomination of directors or considering any transaction that could result in a change in control.

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Transfer Agent and Registrar

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The transfer agent and registrar for our common stock is Computershare Trust Company, N.A.