Item 3.03. Material
Modification of Rights of Security Holders.
On September 22, 2016, all
outstanding shares of Yelp Inc.s (the Company) Class A common stock, par
value $0.000001 per share (the Class A shares), and Class B common stock, par
value $0.000001 per share (the Class B shares), automatically converted into a
single class of common stock (the Conversion) pursuant to the terms of the
Companys Eighth Amended and Restated Certificate of Incorporation (the
Certificate). No additional Class A shares or Class B shares will be issued
following the Conversion.
The Conversion occurred
pursuant to Article Fourth, Section D.3 of the Certificate, which provided that
each Class A share and each Class B share would convert automatically, without
any further action, into one share of the Companys common stock, par value
$0.000001 per share (the common stock), at 5:00 p.m. Eastern Time on the first
business day on or after the date on which the outstanding Class B shares
represented less than ten percent of the aggregate number of then-outstanding
Class A shares and Class B shares.
Also in accordance with
Article Fourth, Section D.3 of the Certificate, and as required by section 243
of the Delaware General Corporation Law (Section 243), the Company filed a
certificate with the Secretary of State of the State of Delaware effecting the
retirement and cancellation of the Class A shares and Class B shares (the
Certificate of Retirement). Pursuant to Section 243, the Certificate of
Retirement had the additional effect of amending the Certificate to eliminate
the obsolete provisions relating to the dual-class common stock structure.
Immediately following the filing of the Certificate of Retirement, the Company
filed a Ninth Amended and Restated Certificate of Incorporation (the Restated
Certificate) reflecting such amendment. The Restated Certificate became
effective on September 23, 2016.
The Conversion had the
following effects, among others, on the holders of Class A shares and Class B
shares:
Voting Power.
Prior to the Conversion, holders
of Class B shares were entitled to cast ten votes per share on any matters
subject to a stockholder vote, and holders of Class A shares were entitled to
cast one vote per share. As a result of the Conversion, all holders of common
stock have only one vote per share on all matters subject to a stockholder vote.
In addition, the provisions of the Certificate and Delaware law that entitled
the holders of Class A shares and Class B shares, in certain circumstances, to
separate class voting rights are no longer applicable as a result of the
Conversion because the Company now has only a single class of common stock
outstanding.
Economic Interests.
The Conversion had no impact on
the economic interests of holders of Class A shares and Class B shares,
including with regard to dividends, liquidation rights and redemption.
Capitalization.
The Conversion had no impact on
the total number of issued and outstanding shares of capital stock; the Class A
shares and Class B shares converted into an equivalent number of shares of
common stock. In addition, the Conversion did not increase the total number of
authorized shares of common stock, which prior to the Conversion was, and
remains, 200,000,000 shares. However, the Companys total number of authorized
shares of capital stock was reduced from 510,000,000 to 210,000,000 to account
for the elimination of the authorized Class A shares and Class B
shares.
Resale of Common Stock.
Shares of common stock may be
sold in the same manner as the Class A shares and Class B shares were previously
sold. The Companys affiliates and holders of any shares that constitute
restricted securities will continue to be subject to the restrictions specified
in Rule 144 promulgated under the Securities Act of 1933, as amended.
Equity Incentive Plans.
Upon Conversion, outstanding
options and restricted stock units denominated in Class A shares or Class B
shares issued under any of the Companys equity incentive plans remained
unchanged, except that they now represent the right to receive shares of the single class of common stock rather than Class A shares or Class B shares.
As required by the terms of the Companys 2012 Equity Incentive Plan (the EIP) and 2012 Employee Stock Purchase Plan (the ESPP), the Board amended such plans to amend the definition of Common Stock in each plan to mean our common stock rather than the Class A shares, effective as of the Conversion. Copies of the amended EIP and ESPP are attached as Exhibits 10.1 and 10.2, respectively, to this Current Report and are incorporated herein by reference.