5.03. Amendments to Articles of Incorporation or Bylaws; Changes in Fiscal Year.
September 27, 2019, Rennova Health, Inc. (the “Company”) filed a Certificate of Designation with the Secretary of
State of the State of Delaware to authorize the issuance of up to 250,000 shares of Series K Convertible Preferred Stock (the
“Preferred Stock”). The following is a summary of certain terms of the Preferred Stock.
The Company’s Board of Directors has designated 250,000 shares of the 5,000,000 authorized shares of preferred stock as
the Preferred Stock. Each share of the Preferred Stock has a stated value of $1.00.
Rights. Each holder of the Preferred Stock shall be entitled to vote on all matters submitted to a vote of the holders
of the Company’s common stock. With respect to a vote of stockholders to approve either or both a reverse stock split
of the Company’s common stock (and any reduction in the authorized shares) and an increase in the authorized shares of
common stock from 10 billion shares to up to 12.5 billion shares, no later than December 31, 2019 only, each share of the
Preferred Stock shall be entitled to the whole number of votes equal to 40,000 shares of common stock. With respect to all
other matters, and from and after December 31, 2019, each share of the Preferred Stock shall be entitled to the whole number
of votes equal to the number of shares of common stock into which it is then convertible. The Preferred Stock shall vote with
the common stock as if they were a single class of securities.
Holders of the Preferred Stock shall be entitled to receive dividends on shares of the Preferred Stock equal (on an as-converted
to common stock basis) to and in the same form as dividends actually paid on shares of common stock when, as and if dividends
are paid on shares of common stock.
The Preferred Stock ranks with respect to dividends or a liquidation, (i) on parity with the common stock, the
Company’s Series G Convertible Preferred Stock and the Company’s Series H Convertible Preferred Stock, (ii)
senior to the Company’s Series F Convertible Preferred Stock, and (iii) junior to the Company’s Series I-1
Convertible Preferred Stock and the Company’s Series 1-2 Convertible Preferred Stock.
Each share of the Preferred Stock is convertible into shares of the Company’s common stock at any time at the option of
the holder, into that number of shares of common stock determined by dividing the stated value of such share of Preferred Stock
plus any accrued and unpaid dividends thereon, by the conversion price. The conversion price is equal to the average closing price
of the common stock on the 10 trading days immediately prior to the conversion date.
Preference. Upon any liquidation, dissolution or winding up of the Company, the holders of the Preferred Stock shall be entitled
to receive an amount equal to the stated value of the Preferred Stock, plus any accrued and unpaid dividends thereon and any other
fees or liquidated damages then due and owing thereon for each share of the Preferred Stock before any distribution or payment
shall be made on any junior securities.
At any time the Company shall have the right to redeem all, or any part, of the Preferred Stock then outstanding. The Preferred
Stock subject to redemption shall be redeemed by the Company in cash in an amount equal to the stated value of the shares of the
Preferred Stock being redeemed plus all accrued and unpaid dividends.
foregoing description of the Preferred Stock does not purport to be complete and is qualified by reference to the Certificate
of Designation of the Preferred Stock, a copy of which is filed as Exhibit 3.21 to this Current Report on Form 8-K and is incorporated
herein by reference.