Description of Securities

EX-4.1 3 ex_156930.htm EXHIBIT 4.1 ex_156930.htm




Description of Registrant’s Securities
Registered Pursuant to Section 12 of the Securities Exchange Act of 1934


As of September 6, 2019, LSI Industries Inc. (“we,” “our”) has one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended, namely, common stock. We also are authorized to issue preferred stock. The description below does not include all of the terms of our common stock and preferred stock and should be read together with our Amended and Restated Articles of Incorporation and Amended and Restated Code of Regulations.




Under our Amended and Restated Articles of Incorporation, we are authorized to issue up to 41,000,000 shares of capital stock, including:


40,000,000 shares of common stock, without par value; and


1,000,000 shares of preferred stock, without par value.


Common Stock


Each outstanding share of common stock is entitled to one vote on all matters submitted to a vote of shareholders, and there are no cumulative voting rights. Our shares of common stock are traded on the Nasdaq Global Select Market.


Subject to the rights of holders of any outstanding shares of preferred stock, each record holder of common stock on the applicable record date is entitled to receive dividends on common stock to the extent authorized by our Board of Directors out of assets legally available for the payment of dividends. In addition, subject to the rights of holders of any outstanding preferred shares, holders of common stock are entitled to share ratably in our assets legally available for distribution to our shareholders in the event of our liquidation, dissolution or winding up after payment of or adequate provision for all our known debts and liabilities.


Holders of common stock do not have any preemptive rights to subscribe for any of our securities. No conversion, redemption or sinking fund provisions apply to the common stock, and the holders of common stock are not liable to further calls or assessments by us.


Preferred Stock


Our Board of Directors is authorized, without shareholder approval, to issue up to 1,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions granted to or imposed upon the preferred shares, including voting rights, dividend rights, conversion rights, terms of redemption, liquidation preference, sinking fund terms and the number of shares constituting any series or the designation of a series. Our Board of Directors can, without shareholder approval, issue preferred shares with voting and conversion rights that could adversely affect the voting power of the holders of common stock. Any preferred shares issued would also rank senior to our common stock as to rights up on liquidation, winding-up or dissolution. If we issue any preferred shares that are convertible into our common stock, such issuance shares could have the effect of delaying, deferring or preventing a change in control of our company. No preferred shares are outstanding.





Control Share Acquisitions


We are subject to Section 1701.831 of the Ohio General Corporation Law (“OGCL”) which provides that certain notice and informational filings and special shareholder meeting and voting procedures must be followed prior to consummation of a proposed “control share acquisition.” The OGCL defines a “control share acquisition” as any acquisition of an issuer’s shares which would entitle the acquirer, immediately after that acquisition, directly or indirectly, to exercise or direct the exercise of voting power of the issuer in the election of directors within any one of the following ranges of that voting power:


one-fifth or more but less than one-third of that voting power;


one-third or more but less than a majority of that voting power; or


a majority or more of that voting power.


Assuming compliance with the notice and information filings prescribed by the statute, the proposed control share acquisition may be made only if, at a special meeting of shareholders, the acquisition is approved by at least a majority of the voting power of the issuer represented at the meeting and at least a majority of the voting power remaining after excluding the combined voting power of the “interested shares.” “Interested shares” are the shares held by the intended acquirer and the employee-directors and officers of the issuer, as well as certain shares that were acquired after the date of the first public disclosure of the acquisition but before the record date for the meeting of shareholders and shares that were transferred, together with the voting power thereof, after the record date for the meeting of shareholders.


Business Combinations with Certain Persons


We are subject to Chapter 1704 of the OGCL, which prohibits certain business combinations and transactions between an “issuing public corporation” and an “Ohio law interested shareholder” for at least three years after the Ohio law interested shareholder attains 10% ownership, unless the Board of Directors of the issuing public corporation approves the transaction before the Ohio law interested shareholder attains 10% ownership. An “issuing public corporation” is an Ohio corporation with 50 or more shareholders that has its principal place of business, principal executive offices, or substantial assets within the State of Ohio, and as to which no close corporation agreement exists. An “Ohio law interested shareholder” is a beneficial owner of 10% or more of the shares of a corporation. Examples of transactions regulated by Chapter 1704 include the disposition of assets, mergers and consolidations, voluntary dissolutions and the transfer of shares.


Subsequent to the three-year period, a transaction subject to Chapter 1704 may take place provided that certain conditions are satisfied, including:


prior to the interested shareholder’s share acquisition date, the board of directors approved the purchase of shares by the interested shareholder;


the transaction is approved by the holders of shares with at least 66 2/3% of the voting power of the corporation (or a different proportion set forth in the articles of incorporation), including at least a majority of the outstanding shares after excluding shares controlled by the Ohio law interested shareholder; or


the business combination results in shareholders, other than the Ohio law interested shareholder, receiving a fair price plus interest for their shares.


Chapter 1704 is applicable to all corporations formed under Ohio law.





Provisions in Articles Affecting Business Combinations


Our Amended and Restated Articles of Incorporation require approval by 66-2/3% of the voting power of disinterested shareholders for any business combination between an interested shareholder and us for five years after such party became an interested shareholder. An interested shareholder is one beneficially owning 15% or more of the voting power. Business combinations include mergers, sales of assets and similar transactions. Our Amended and Restated Articles of Incorporation also require any person who becomes an interested shareholder to offer to purchase all of our voting securities and securities convertible into or constituting warrants or options to purchase our voting securities within 25 days after achieving 15% ownership. The price to be paid would be the higher of the highest price paid by the interested shareholder in acquiring such beneficial ownership or the highest trading price during the 45 day period commencing 70 days prior to the date that such person became an interested shareholder. These provisions are not applicable if the proposed business combination is approved prior to its consummation by a majority of disinterested directors or if the transaction by which a person becomes an interested shareholder is approved at any time prior to that time by a majority of disinterested directors. The vote of holders of 66-2/3% of all outstanding shares of common stock is required to amend our Amended and Restated Articles of Incorporation and to approve mergers, reorganizations, and similar transactions.


Transfer Agent and Registrar


Computershare serves as the transfer agent and registrar for our common stock.