On December 11, 2014, a duly authorized committee of the Board of Directors (the “ Board ”) of Liquid Holdings Group, Inc., a Delaware corporation (the “ Company ”), declared a dividend distribution of one right (each, a “ Right ” and together with all other such rights distributed or issued, the “ Rights ”) for each outstanding share of common stock, par value $0.0001, of the Company (the “ Common Stock ”). The dividend is payable to holders of record as of the close of business on December 22, 2014 (the “ Record Date ”).
The following is a summary description of the Rights. This summary is intended to provide a general description only and is subject to the detailed terms and conditions of the Rights Agreement, dated as of December 11, 2014, by and between the Company and Continental Stock Transfer and Trust Company, as rights agent (the “ Rights Agent ”), a copy of which is attached hereto as Exhibit 4.1, which is incorporated herein by reference (the “ Rights Agreement ”). Capitalized terms used but not defined herein have the meanings ascribed to them in the Rights Agreement.
Issuance of Rights
Each holder of Common Stock as of the Record Date will receive a dividend of one Right per share of Common Stock. One Right will also be issued together with each share of Common Stock issued by the Company after the Record Date and prior to the Distribution Date (as defined below), and in certain circumstances, after the Distribution Date. New certificates for Common Stock issued after the Record Date will contain a notation incorporating the Rights Agreement by reference.
Until the Distribution Date:
· the Rights will not be exercisable;
· the Rights will be evidenced by the certificates for Common Stock (or, in the case of book entry shares, by notation in book entry) and not by separate rights certificates; and
· the Rights will be transferable by, and only in connection with, the transfer of Common Stock.
Distribution Date; Beneficial Ownership
The Rights are not exercisable until the Distribution Date. As of and after the Distribution Date, the Rights will separate from the Common Stock and each Right will become exercisable to purchase one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.0001 per share, of the Company (each whole share, a share of “ Preferred Stock ”) at a purchase price of $4.00 (such purchase price, as may be adjusted, the “ Purchase Price ”). This portion of a share of Preferred Stock would give the holder thereof approximately the same dividend, voting, and liquidation rights as would one share of Common Stock. Prior to exercise, the Right does not give its holder any dividend, voting or liquidation rights.
