The Selling Shareholder may sell our common shares, to or through underwriters, agents, brokers or dealers, in private transactions, at market prices prevailing at the time of sale, at prices related to the prevailing
market prices, at negotiated prices, at fixed prices (which may be changed), or at varying prices determined at the time of sale.
As part of the Delphin Vessel Acquisition, the Selling Shareholder has agreed not to sell, contract to sell, or otherwise dispose more than 2,251,685 of the Consideration Shares prior to November 23, 2019.
The Selling Shareholder may sell our common shares included in this prospectus, through:
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a block trade in which a broker-dealer may resell a portion of the block, as principal, to facilitate the transaction;
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purchases by a broker-dealer, as principal, and resale by the broker-dealer for its account;
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ordinary brokerage transactions and transactions in which a broker solicits purchasers;
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an over-the-counter distribution;
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an exchange or market distribution in accordance with the rules of the applicable exchange or market;
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privately negotiated transactions;
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trading plans entered into by the Selling Shareholder pursuant to Rule 10b5-1 under the Exchange Act that are in place at the time of an offering pursuant to this prospectus and any applicable prospectus supplement hereto that provide
for periodic sales of the common shares on the basis of parameters described in such trading plans;
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otherwise through a combination of any of the above methods of sale; or
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any other method permitted pursuant to applicable law.
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In addition, the Selling Shareholder may enter into option, share lending or other types of transactions that require the Selling Shareholder to deliver our common shares to an underwriter or a broker-dealer, who will
then resell or transfer the common shares under this prospectus. The Selling Shareholder also may enter into hedging transactions with respect to our common shares. For example, the Selling Shareholder may:
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enter into transactions involving short sales of our common shares by underwriters or broker-dealers;
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sell common shares short and deliver the shares to close out short positions;
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enter into option or other types of transactions that require the Selling Shareholder to deliver common shares to an underwriter or broker-dealer, who will then resell or transfer the common shares under this prospectus; or
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loan or pledge the common shares to an underwriter or broker-dealer (including pursuant to a margin loan), who may sell the loaned shares or, in the event of default, sell the pledged shares.
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The Selling Shareholder will act independently of us in making decisions with respect to the timing, manner and size of each sale of common shares covered by this prospectus. The Selling Shareholder might not sell any
common shares under this prospectus. In addition, any common shares covered by this prospectus that qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than pursuant to this prospectus.
The Selling Shareholder may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus
supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities
pledged by the Selling Shareholder or borrowed from the Selling Shareholder or others to settle those sales or to close out any related open borrowings of shares, and may use securities received from the Selling Shareholder in settlement of those
derivatives to close out any related open borrowings of shares. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be identified in the applicable prospectus supplement (or a
post-effective amendment). In addition, the Selling Shareholder may otherwise loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus. Such financial institution or
other third party may transfer its economic short position to investors in our securities or the securities of the Selling Shareholder or in connection with a concurrent offering of other securities.
Common shares may also be exchanged for satisfaction of the Selling Shareholder’s obligations or other liabilities to its creditors. Such transactions may or may not involve broker-dealers.
The Selling Shareholder and any broker-dealers or other persons acting on behalf of the Selling Shareholder that participate with the Selling Shareholder in the distribution of the securities may be deemed to be
underwriters, and any commissions received or profit realized by them on the resale of the securities may be deemed to be underwriting discounts and commissions under the Securities Act. As a result, we have informed the Selling Shareholder that
Regulation M, promulgated under the Exchange Act, may apply to sales by the Selling Shareholder in the market.
Some of the underwriters, dealers or agents used by the Selling Shareholder in any offering of securities under this prospectus may be customers of, engage in transactions with, and perform services for the Selling
Shareholder or its affiliates in the ordinary course of business. Underwriters, dealers, agents and other persons may be entitled under agreements which may be entered into with the Selling Shareholder to indemnification against and contribution
toward certain civil liabilities, including liabilities under the Securities Act, and to be reimbursed by the Selling Shareholder for certain expenses.
To the extent required by the Securities Act, a prospectus supplement will be distributed at the time that any particular offering of common shares is made, setting forth the terms of the offering, including the
aggregate number of common shares being offered; the purchase price of the common shares and the proceeds the Selling Shareholder will receive from the sale of the common shares; the initial offering price of the common shares; the names of any
underwriters, dealers or agents; any discounts, commissions and other items constituting compensation from us; any discounts, commissions or concessions allowed or re-allowed or paid to underwriters, dealers or agents; any securities exchanges on
which the common shares may be listed; the method of distribution of the common shares; the terms of any agreement, arrangement or understanding entered into with the underwriters, brokers or dealers; and any other information we think is important.
Furthermore, the Selling Shareholder may agree, subject to certain exemptions, that for a certain period from the date of the prospectus supplement under which the common shares are offered, it will not, without the prior written consent of an
underwriter, offer, sell, contract to sell, pledge or otherwise dispose of any of the Selling Shareholder’s common shares. However, an underwriter, in its sole discretion, may release any of the common shares subject to these lock-up agreements at
any time without notice. We expect an underwriter to exclude from these lock-up agreements common shares exercised and/or sold pursuant to trading plans entered into by the Selling Shareholder pursuant to Rule 10b5-1 under the Exchange Act, that are
in place at the time of an offering pursuant to this prospectus and any applicable prospectus supplement hereto that provide for periodic sales of the Selling Shareholder’s common shares on the basis of parameters described in such trading plans.
Underwriters or agents could make sales in privately negotiated transactions and/or any other method permitted by law, including sales deemed to be an at-the-market offering as defined in Rule 415 promulgated under the
Securities Act, which includes sales made directly on or through the Nasdaq Global Select Market, the existing trading market for our common shares, or sales made to or through a market maker other than on an exchange.
We will bear costs relating to the securities offered and sold by the Selling Shareholder under this Registration Statement.
As a result of requirements of the Financial Industry Regulatory Authority, or “
FINRA
,” formerly the National Association of Securities Dealers, Inc., the maximum commission or discount to be received by any FINRA
member or independent broker/dealer may not be greater than eight percent (8%) of the gross proceeds received by the Selling Shareholder for the sale of any securities being registered pursuant to Rule 415 promulgated by the Commission under the
Securities Act. If more than 5% of the net proceeds of any offering of common shares made under this prospectus will be received by a FINRA member participating in the offering or affiliates or associated persons of such a FINRA member, the offering
will be conducted in accordance with FINRA Rule 5121.
DESCRIPTION OF CAPITAL STOCK
Authorized Share Capital
Under our fourth amended and restated articles of incorporation, or our “
Articles
,” our authorized capital stock consists of 300,000,000 common shares, par value $0.01 per share, and 25,000,000 preferred shares,
par value $0.01 per share, none of which were issued as of the date of this prospectus.
Common Shares
As of June 25, 2019, we had 91,750,000 common shares outstanding out of 300,000,000 shares authorized to be issued. Each outstanding common share entitles the holder to one vote on all matters submitted to a vote of
shareholders. Subject to preferences that may be applicable to any outstanding preferred shares, holders of common shares are entitled to receive ratably all dividends, if any, declared by our board of directors (the “
Board of Directors
”) out
of funds legally available for dividends. Upon our dissolution or liquidation or the sale of all or substantially all of our assets, after payment in full of all amounts required to be paid to creditors and to the holders of our preferred shares
having liquidation preferences, if any, the holders of our common shares will be entitled to receive pro rata our remaining assets available for distribution. Holders of our common shares do not have conversion, redemption or preemptive rights to
subscribe to any of our securities. All outstanding common shares are fully paid and non-assessable. The rights, preferences and privileges of holders of our common shares are subject to the rights of the holders of any preferred shares which we may
issue in the future.
Reverse Stock Split
On June 20, 2016, we effected the June 2016 Reverse Stock Split. The June 2016 Reverse Stock Split reduced the number of the Company’s shares from 219,778,437 to 43,955,659. All share counts presented in this prospectus
have been adjusted for the June 2016 Reverse Stock Split.
Equity Incentive Plans
On May 9, 2016, February 22, 2017, February 27, 2018 and May 22, 2019, respectively, the Board of Directors approved the 2016 Equity Incentive Plan (the “
2016 Equity Incentive Plan
”), the 2017 Equity Incentive
Plan (the “
2017 Equity Incentive Plan
”) the 2018 Equity Incentive Plan (the “
2018 Equity Incentive Plan
”) and the 2019 Equity Incentive Plan (the “2019 Equity Incentive Plan” and collectively, the “
Equity Incentive Plans
”), under
which officers, key employees, directors, and consultants of the Company and its subsidiaries are eligible to receive options to acquire common shares, shares appreciation rights, restricted shares and other share-based or share-denominated awards.
We reserved a total of 940,000 common shares, 950,000 common shares, 700,000 common shares and 900,000 common shares for issuance under the Equity Incentive Plans, subject to further adjustment for changes in capitalization as provided in the plans.
The purpose of the Equity Incentive Plans is to encourage ownership of shares by, and to assist us in attracting, retaining and providing incentives to, our officers, key employees, directors and consultants, whose contributions to us are or may be
important to our success and to align the interests of such persons with our shareholders. The various types of incentive awards that may be issued under the Equity Incentive Plans enable us to respond to changes in compensation practices, tax laws,
accounting regulations and the size and diversity of our business. The Equity Incentive Plans are administered by our compensation committee, or such other committee of the Board of Directors as may be designated by the Board of Directors. The Equity
Incentive Plans permit issuance of restricted shares, grants of options to purchase common shares, share appreciation rights, restricted shares, restricted share units and unrestricted shares.
Under the terms of the Equity Incentive Plans, share options and share appreciation rights granted under the Equity Incentive Plans have an exercise price per common share equal to the fair market value of a common share
on the date of grant, unless otherwise determined by the administrator of the Equity Incentive Plans, but in no event will the exercise price be less than the fair market value of a common share on the date of grant. Options and share appreciation
rights are exercisable at times and under conditions as determined by the administrator of the Equity Incentive Plans, but in no event will they be exercisable later than ten years from the date of grant.
The administrator of the Equity Incentive Plans may grant common shares of restricted shares and awards of restricted share units subject to vesting and forfeiture provisions and other terms and conditions as determined
by the administrator of the Equity Incentive Plans. Upon the vesting of a restricted share unit, the award recipient will be paid an amount equal to the number of restricted share units that then vest multiplied by the fair market value of a common
share on the date of vesting, which payment may be paid in the form of cash or common shares or a combination of both, as determined by the administrator of the Equity Incentive Plans. The administrator of the Equity Incentive Plans may grant
dividend equivalents with respect to grants of restricted share units.
Adjustments may be made to outstanding awards in the event of a corporate transaction or change in capitalization or other extraordinary event. In the event of a “change in control” (as defined in the Equity Incentive
Plans), unless otherwise provided by the administrator of the Equity Incentive Plans in an award agreement, awards then outstanding shall become fully vested and exercisable in full.
The Board of Directors may amend or terminate the Equity Incentive Plans and may amend outstanding awards, provided that no such amendment or termination may be made that would materially impair any rights, or materially
increase any obligations, of a grantee under an outstanding award. Shareholders’ approval of Equity Incentive Plans amendments may be required in certain definitive, pre-determined circumstances if required by applicable rules of a national
securities exchange or the Commission. Unless terminated earlier by the Board of Directors, the Equity Incentive Plans will expire ten years from the date on which the Equity Incentive Plans was adopted by the Board of Directors.
On January 7, 2019, our Board of Directors and Compensation Committee established an incentive program for key employees, pursuant to which an aggregate of 4,000,000
restricted share units (each, a “
RSU
”) will be issued. Each RSU represents, upon vesting, a right for the relevant
beneficiary to receive one common share of the Company. The RSUs are subject to the satisfaction of certain performance conditions, which apply if our fleet performs better than relevant dry bulk charter rate indices as reported by the Baltic
Exchange (the “
Indices
”) during 2020 and 2021. The RSUs start to vest if the Company’s fleet performs better than the
Indices by at least $120,000,000, and vest in increasing amounts if and to the extent the performance of our fleet exceeds those of the relative to the Indices by up to an aggregate of $300,000,000. We take the view that the current likelihood of
vesting of these RSUs does not meet a “more likely than not” standard under US GAAP, and as a result no charge will be amortized through our statement of operations, until vesting becomes probable. Subject to the vesting conditions being met on
April 30, 2021 and April 30, 2022 (each, a “
Vesting Date
”) two million RSUs will vest on each Vesting Date, and the
relevant common shares of the Company will be issued and distributed to the relevant beneficiaries as per the allocation of the Board of Directors. Any non-vested RSUs at the applicable Vesting Date will be cancelled.
The terms and conditions of the Equity Incentive Plans are substantially similar to those of the previous plans. All of the common shares that were granted under 2016 Equity Incentive Plan and 2017 Equity Incentive Plan
were issued and vested in full, whereas there are 71,500 common shares unvested from the 2018 Equity Incentive Plan, as of the date of this prospectus. In addition, as of the date of this prospectus all 885,000 common shares granted under the 2019
Equity Incentive Plan remain unvested and 101,074 common shares are available under the 2016, 2017, 2018 and 2019 Equity Incentive Plans.
Share Repurchase Program
On November 29, 2018, our Board of Directors authorized a share repurchase program (the “
Share Repurchase Program
”) to purchase up to an aggregate of $50.0 million of our common shares. The timing and amount of
any repurchases will be in the sole discretion of our management team, and will depend on legal requirements, market conditions, share price, alternative uses of capital and other factors. Repurchases of common shares may take place in privately
negotiated transactions, in open market transactions pursuant to Rule 10b-18 of the Exchange Act and/or pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act. We are not obligated under the terms of the Share
Repurchase Program to repurchase any of its common shares. The Share Repurchase Program has no expiration date and may be suspended or terminated by us at any time without prior notice. We will cancel common shares repurchases as part of this
program. Please see the section of this prospectus entitled “Recent Developments – Updated share count” for further information on our share repurchase program.
Preferred Shares
Under the terms of our Articles, our Board of Directors has the authority, without any further vote or action by our shareholders, to issue up to 25,000,000 preferred shares. Our Board of Directors is authorized to
provide for the issuance of preferred shares in one or more series with designations as may be stated in the resolution or resolutions providing for the issue of preferred shares. At the time that any series of our preferred shares are authorized,
our Board of Directors will fix the dividend rights, any conversion rights, any voting rights, redemption provisions, liquidation preferences and any other rights, preferences, privileges and restrictions of that series, as well as the number of
shares constituting that series and their designation. Our Board of Directors could, without shareholder approval, cause us to issue preferred shares which have voting, conversion and other rights that could adversely affect the holders of our common
shares or make it more difficult to effect a change in control. Our preferred shares could be used to dilute the share ownership of persons seeking to obtain control of us and thereby hinder a possible takeover attempt which, if our shareholders were
offered a premium over the market value of their shares, might be viewed as being beneficial to our shareholders. In addition, our preferred shares could be issued with voting, conversion and other rights and preferences which would adversely affect
the voting power and other rights of holders of our common shares. Our Board of Directors may issue preferred shares on terms calculated to discourage, delay or prevent a change of control in us or the removal of our management.
Directors
Our directors are elected by the affirmative vote of a majority of the shares represented at the meeting. There is no provision for cumulative voting.
Our Board of Directors must consist of at least three members. Shareholders may change the number of directors only by amending the bylaws which requires the affirmative vote of holders of 70% or more of the outstanding
shares of capital stock entitled to vote generally in the election of directors. The Board of Directors may change the number of directors, but may not reduce the number to be less than three directors, only by a vote of not less than 66
2
/
3
%
of the entire Board of Directors. At each annual meeting, directors to replace those directors whose terms expire at such annual meeting shall be elected to hold office until the third succeeding annual meeting. Each director shall serve his
respective term of office until his successor shall have been duly elected and qualified, except in the event of his death, resignation, removal, or the earlier termination of his term of office. Our Board of Directors has the authority to fix the
amounts which shall be payable to the members of the Board of Directors for attendance at any meeting or for services rendered to us.
Interested Transactions
Our Third Amended and Restated Bylaws, or “Bylaws,” provide that no contract or transaction between us and one or more of its directors or officers, or between us and any other corporation, partnership, association or
other organization in which one or more of our directors or officers are directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in
the meeting of our Board of Directors or committee thereof which authorizes the contract or transaction, or solely because his or her or their votes are counted for such purpose, if: (i) the material facts as to his or her relationship or interest
and as to the contract or transaction are disclosed or are known to our Board of Directors or the committee and our Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the
disinterested directors, or, if the votes of the disinterested directors are insufficient to constitute an act of our Board of Directors as defined in Section 55 of the Marshall Islands Business Corporation Act, or the MIBCA, by unanimous vote of the
disinterested directors; or (ii) the material facts as to his relationship or interest and as to the shareholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the shareholders; or (iii)
the contract or transaction is fair as to us as of the time it is authorized, approved or ratified, by our Board of Directors, a committee thereof or the shareholders. Common or interested directors may be counted in determining the presence of a
quorum at a meeting of our Board of Directors or of a committee which authorizes the contract or transaction.
Shareholder Meetings
Under our Bylaws, annual shareholder meetings will be held at a time and place selected by our Board of Directors. The meetings may be held in or outside of the Marshall Islands. Our Board of Directors may set a record
date between 10 and 60 days before the date of any meeting to determine the shareholders that will be eligible to receive notice and vote at the meeting.
Dissenters’ Rights of Appraisal and Payment
Under the MIBCA, our shareholders have the right to dissent from various corporate actions, including any merger or consolidation or sale of all or substantially all of our assets not made in the usual course of our
business, and receive payment of the fair value of their shares. However, the right of a dissenting shareholder to receive payment of the appraised fair value of his shares is not available under the MIBCA if for the shares of any class or series of
shares, which shares or depository receipts in respect thereof, at the record date fixed to determine the shareholders entitled to receive notice of and to vote at the meeting of the shareholders to act upon the agreement of merger or consolidation,
were either (i) listed on a securities exchange or admitted for trading on an interdealer quotation system or (ii) held of record by more than 2,000 holders. In the event of any further amendment of our amended and restated articles of incorporation,
a shareholder also has the right to dissent and receive payment for the shareholder’s shares if the amendment alters certain rights in respect of those shares. The dissenting shareholder must follow the procedures set forth in the MIBCA to receive
payment. In the event that we and any dissenting shareholder fail to agree on a price for the shares, the MIBCA procedures involve, among other things, the institution of proceedings in any appropriate court in any jurisdiction in which our shares
are primarily traded on a local or national securities exchange.
Shareholders’ Derivative Actions
Under the MIBCA, any of our shareholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the shareholder bringing the action is a holder of our common
shares both at the time the derivative action is commenced and at the time of the transaction to which the action relates.
Limitations on Liability and Indemnification of Officers and Directors
The MIBCA authorizes corporations to limit or eliminate the personal liability of directors and officers to corporations and their shareholders for monetary damages for breaches of directors’ fiduciary duties. Our
Articles and Bylaws include a provision that eliminates the personal liability of directors for monetary damages for actions taken as a director to the fullest extent permitted by law.
Our Bylaws provide that we must indemnify our directors and officers to the fullest extent authorized by law. We are also expressly authorized to advance certain expenses (including attorneys’ fees and disbursements and
court costs) to our directors and officers and carry directors’ and officers’ insurance policies providing indemnification for our directors, officers and certain employees for some liabilities. We believe that these indemnification provisions and
insurance are useful to attract and retain qualified directors and executive officers.
The limitation of liability and indemnification provisions in our Articles and Bylaws may discourage shareholders from bringing a lawsuit against directors for breach of their fiduciary duty. These provisions may also
have the effect of reducing the likelihood of derivative litigation against directors and officers, even though such an action, if successful, might otherwise benefit us and our shareholders. In addition, your investment may be adversely affected to
the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons, we have been advised that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
There is currently no pending material litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought.
Anti-Takeover Effect of Certain Provisions of our Articles and Bylaws
Several provisions of our Articles and Bylaws, which are summarized below, may have anti-takeover effects. These provisions are intended to avoid costly takeover battles, lessen our vulnerability to a hostile change of
control and enhance the ability of our Board of Directors to maximize shareholder value in connection with any unsolicited offer to acquire us. However, these anti-takeover provisions, which are summarized below, could also discourage, delay or
prevent (i) the merger or acquisition of our Company by means of a tender offer, a proxy contest or otherwise that a shareholder may consider in its best interest and (ii) the removal of incumbent officers and directors.
Classified Board of Directors
Our Articles provide for the division of our Board of Directors into three classes of directors, with each class as nearly equal in number as possible, serving staggered, three year terms. Approximately one-third of our
Board of Directors will be elected each year. This classified board provision could discourage a third party from making a tender offer for our common shares or attempting to obtain control of us. It could also delay shareholders who do not agree
with the policies of our Board of Directors from removing a majority of our Board of Directors for two years.
Blank Check Preferred Shares
Our Articles authorize our Board of Directors to establish one or more series of preferred shares and to determine, with respect to any series of preferred shares, the terms and rights of that series, including:
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the designation of the series;
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the preferences and relative, participating, option or other special rights, if any, and any qualifications, limitations or restrictions of such series; and
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the voting rights, if any, of the holders of the series.
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Business Combinations
Although the MIBCA does not contain specific provisions regarding “business combinations” between corporations organized under the laws of the Republic of Marshall Islands and “interested shareholders,” we have included
these provisions in our Articles. Our Articles contain provisions which prohibit us from engaging in a business combination with an interested shareholder for a period of three years after the date of the transaction in which the person became an
interested shareholder, unless:
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prior to the date of the transaction that resulted in the shareholder becoming an interested shareholder, our Board of Directors approved either the business combination or the transaction that resulted in the shareholder becoming an
interested shareholder;
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upon consummation of the transaction that resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at least 85% of the voting shares of the corporation outstanding at the time the transaction
commenced, excluding for purposes of determining the number of shares outstanding those shares owned (i) by persons who are directors and also officers and (ii) employee share plans in which employee participants do not have the right to
determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer;
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at or subsequent to the date of the transaction that resulted in the shareholder becoming an interested shareholder, the business combination is approved by the Board of Directors and authorized at an annual or special meeting of
shareholders, and not by written consent, by the affirmative vote of at least 70% of the outstanding voting shares that is not owned by the interested shareholder; or
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the shareholder became an interested shareholder prior to the consummation of the initial public offering of common shares under the Securities Act.
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For purposes of these provisions, a “business combination” includes mergers, consolidations, exchanges, asset sales, leases and other transactions resulting in a financial benefit to the interested shareholder and an
“interested shareholder” is any person or entity that beneficially owns 20% or more of the shares of our outstanding voting shares and any person or entity affiliated with or controlling or controlled by that person or entity.
Election and Removal of Directors
Our Articles prohibit cumulative voting in the election of directors. Our Articles and Bylaws require parties other than the Board of Directors to give advance written notice of nominations for the election of directors.
Our Articles and Bylaws also provide that our directors may be removed only for cause and only upon the affirmative vote of the holders of 70% or more of the outstanding shares of our capital stock entitled to vote generally in the election of
directors. These provisions may discourage, delay or prevent the removal of incumbent officers and directors.
Limited Actions by Shareholders
Our Bylaws provide that any action required or permitted to be taken by our shareholders must be effected at an annual meeting of shareholders or by the unanimous written consent of our shareholders. Our Bylaws also
provide that our Board of Directors, Chairman, or President may call special meetings of our shareholders and the business transacted at the special meeting is limited to the purposes stated in the notice. Accordingly, shareholders are prevented from
calling a special meeting and shareholder consideration of a proposal may be delayed until the next annual meeting.
Supermajority Provisions
The MIBCA generally provides that the affirmative vote of a majority of the outstanding shares entitled to vote at a meeting of shareholders is required to amend a corporation’s articles of incorporation, unless the
articles of incorporation requires a greater percentage. Our Articles provide that the following provisions in the Articles may be amended only by an affirmative vote of 70% or more of the outstanding shares of our capital stock entitled to vote
generally in the election of directors:
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the Board of Directors shall be divided into three classes;
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directors may only be removed for cause and by an affirmative vote of the holders of 70% or more of the outstanding shares of our capital stock entitled to vote generally in the election of directors;
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the directors are authorized to make, alter, amend, change or repeal our bylaws by vote not less than 66
2
/
3
% of the entire Board of Directors;
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the shareholders are authorized to alter, amend or repeal our bylaws by an affirmative vote of 70% or more of the outstanding shares of our capital stock entitled to vote generally in the election of directors;
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we may not engage in any business combination with any interested shareholder for a period of three years following the transaction in which the person became an interested shareholder; and
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we shall indemnify directors and officers to the full extent permitted by law, and we shall advance certain expenses (including attorneys’ fees and disbursements and court costs) to the directors and officers. For purposes of these
provisions, an “interested shareholder” is generally any person or entity that owns 20% or more of the shares of our outstanding voting shares or any person or entity affiliated with or controlling or controlled by that person or entity.
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Advance Notice Requirements for Shareholders Proposals and Director Nominations
Our Articles and Bylaws provide that shareholders seeking to nominate candidates for election as directors or to bring business before an annual meeting of shareholders must provide timely notice of their proposal in
writing to the corporate secretary. Generally, to be timely, a shareholder’s notice must be received at our principal executive offices not less than 120 days nor more than 180 days prior to the one year anniversary of the immediately preceding
year’s annual meeting of shareholders. Our Articles and Bylaws also specify requirements as to the form and content of a shareholder’s notice. These provisions may impede a shareholder’s ability to bring matters before an annual meeting of
shareholders or make nominations for directors at an annual meeting of shareholders.
The following are the estimated expenses of the issuance and distribution of the common shares being registered under the registration statement of which this prospectus forms a part, all of which will be paid by us.
Commission registration fee
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$
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3,819
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FINRA filing fee
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$
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*
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Legal fees and expenses
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$
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*
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|
Accounting fees and expenses
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$
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*
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Printing and typesetting expenses
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$
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*
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Blue sky fees and expenses
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$
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*
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Miscellaneous
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$
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*
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Total
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$
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*
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*
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To be provided by a prospectus supplement or as an exhibit to a Report on Form 6-K that is incorporated by reference into this registration statement.
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