Item 5.02 Departure of Directors or Certain Officers; Election
of Directors; Appointment of Principal Officers; Compensatory Arrangements of Certain Officers
On July 21, 2020, the board of
directors of the Company (the “Board”) voted to increase the size of the Board from nine members to ten members
in order to elect an individual designated by the Buyer for a term expiring at the third annual meeting of the
Company’s stockholders following the Closing Date. The Board appointed Roberto Ardagna, the individual designated by
the Buyer under the terms of the Investment Agreement, to fill the newly-created vacancy on the Board. Mr. Ardagna will serve
as a Class I director until the Company’s Annual Meeting of Stockholder to be held during 2023.
Mr. Ardagna is currently a Senior
Principal at Investindustrial Services Limited. Prior to joining Investindustrial in 2010, Mr. Ardagna worked on the European
real estate investment team of The Carlyle Group between 2006 and 2010. He started his career in the investment banking
division of Lehman Brothers. Mr. Ardagna holds a Master of Science in Finance and Economics from Bocconi University and an MBA from
Harvard Business School.
Mr. Ardagna has not been a party to any
transaction involving the Company required to be disclosed under Item 404(a) of Regulation S-K.
Pursuant to the terms of the Investment
Agreement, Mr. Ardagna will not be entitled to compensation (in cash, equity or otherwise), but shall be entitled to reimbursement
from the Company for the out-of-pocket fees or expenses incurred (other than in connection with international flights), in a manner
consistent with the Company’s practices with respect to expense reimbursement for other members of the Board, in connection
with his service as a director of the Board.
Item 5.03. Amendments to Articles of Incorporation or Bylaws;
Change in Fiscal Year
On July 20, 2020, the Company filed a Certificate
of Designations (the “Certificate of Designations”) with the Secretary of State of the State of Delaware to establish
the preferences, limitations and relative rights of the Series A Preferred Stock. The Certificate of Designations became effective
upon filing.
The Series A Preferred Stock ranks senior
to the Company’s common stock, par value $0.01 per share (the “Common Stock”), with respect to dividend rights
and rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs
of the Company. The Series A Preferred Stock has a liquidation preference of $1,000 per share. Holders of the Series A Preferred
Stock are entitled to a cumulative dividend at the rate of 4.5% per annum, payable quarterly in arrears, as set forth in the Certificate
of Designations. The Company may elect, in its sole discretion, to pay dividends in cash or as a dividend in-kind (additional shares
of Series A Preferred Stock having value equal to the amount of accrued dividends) until the two year anniversary of the Closing
Date, after which the Company must pay dividends in cash. For purposes of the foregoing sentence, the deemed value of a share of
Series A Preferred Stock is equal to its liquidation preference of $1,000 per share plus any accrued and unpaid dividends.
The Series A Preferred Stock is convertible
at the option of the holders thereof at any time into shares of Common Stock at an initial conversion price of $16.7500 per share
of Series A Preferred Stock, subject to certain anti-dilution adjustments. At any time after the two year anniversary of the Closing
Date, if the volume weighted average price of the Common Stock exceeds $29.3125 per share, as may be adjusted pursuant to the Certificate
of Designations, for at least 20 trading days in any period of 30 consecutive trading days, the Company may elect to convert all
or a portion of the Series A Preferred Stock into shares of Common Stock in accordance with the Certificate of Designations.
Holders of the Series A Preferred Stock
are entitled to vote as a single class with the holders of the Common Stock on an as-converted basis. Holders of the Series A Preferred
Stock are entitled to a separate class vote with respect to, among other things, amendments to the Company’s organizational
documents that have an adverse effect on the rights, preferences, privileges or voting power of the Series A Preferred Stock, authorizations
or issuances by the Company of securities that are senior to, or equal in priority with, the Series A Preferred Stock and increases
or decreases in the number of authorized shares or issuances of shares of Series A Preferred Stock after the Closing Date.
At any time on or after the sixth anniversary
of the Closing Date, the Company may redeem, in whole or, from time to time, in part, the shares of Series A Preferred Stock for
a redemption price equal to: (i) the sum of (x) the liquidation preference thereof, plus (y) all accrued and unpaid dividends,
multiplied by (ii) (A) 110% if the redemption occurs at any time on or after the sixth anniversary of the Closing Date and prior
to the seventh anniversary of the Closing Date, (B) 105% if the redemption occurs at any time on or after the seventh anniversary
of the Closing Date and prior to the eighth anniversary of the Closing Date, and (C) 100% if the redemption occurs at any time
on or after the eighth anniversary of the Closing Date.
Upon certain change of control events involving
the Company, the holders of the Series A Preferred Stock may either (i) convert their shares of Series A Preferred Stock into Common
Stock at the then-current conversion price or (ii) cause the Company to redeem their shares of Series A Preferred Stock. Additionally,
upon certain change of control events involving the Company, the Company may elect to redeem the Series A Preferred Stock. If the
holders of the Series A Preferred Stock elect to have their shares of Series A Preferred Stock redeemed, or if the Company elects
to redeem the Series A Preferred Stock, in each case, in connection with a change of control, the redemption price per share will
be an amount in cash equal to 100% of the sum of the liquidation preference thereof and all accrued but unpaid dividends, plus
a “make-whole” premium if such change of control occurs on or before the seventh anniversary of the Closing Date, plus,
(i) if the redemption date is prior to the sixth anniversary of the Closing Date, all dividends that would have accrued on such
share from the change of control redemption date to the sixth anniversary of the Closing Date, or (ii) if the redemption date is
on or after the sixth anniversary of the Closing Date and prior to the seventh anniversary of the Closing Date, all dividends that
would have accrued on such share from the change of control redemption date to the seventh anniversary of the Closing Date.
The foregoing description of the Certificate
of Designations and the Series A Preferred Stock does not purport to be complete and is subject to, and qualified in its entirety
by, the full text of the Certificate of Designations, which is attached hereto as Exhibit 3.1, and is incorporated herein by reference.