DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock summarizes the material terms and provisions of our capital stock. For the complete terms of
our capital stock, please refer to our amended and restated articles of incorporation and our amended and restated by-laws, which have been filed as an exhibit hereto. The Marshall Islands Business
Corporations Act (the BCA), may also affect the terms of these securities.
Authorized Capitalization
Under our amended and restated articles of incorporation, our authorized capital stock consists of 2,000,000,000 shares of common stock, par
value $0.01 per share, and 200,000,000 shares of preferred stock, par value $0.01 per share. All of our shares of stock are in registered form. As of June 30, 2022, 190,254,034 shares of Common Stock and 795,878 shares of 8.75% Series A Cumulative
Redeemable Perpetual Preferred Stock were issued and outstanding, as well as Class A Warrants to purchase up to 43,000 shares of Common Stock at an exercise price of $1.25 per share, Class B Warrants to purchase up to 11,802,000 shares of
Common Stock at an exercise price of $1.60 per share, Class C Warrants to purchase up to 78,278,862 shares of Common Stock at an exercise price of $0.55 per share, which expire on May 19, 2027 and Class D Warrants to purchase up to 31,150,000 shares
of Common Stock at an exercise price of $0.80 per share, which expire on June 15, 2027 and underwriters warrants to purchase up to 552,000 shares of Common Stock at an exercise price of $1.375 per share, 1,724,998 shares of Common Stock at an
exercise price of $2.00 per share, and 2,090,909 shares of common stock at an exercise price of $0.6875 per share.
Common Stock
Under our amended and restated articles of incorporation, we are authorized to issue up to 2,000,000,000 shares of common stock,
par value $0.01 per share, of which there were 4,775,272 shares issued and outstanding as of December 31, 2021 and 190,254,034 shares outstanding as of June 30, 2022. As of June 30, 2022, we also had outstanding Class A Warrants to
purchase up to 43,000 shares of common stock at an exercise price of $1.25 per share, Class B Warrants to purchase up to 11,802,000 shares of common stock at an exercise price of $1.60 per share, 78,278,862 shares of common stock subject to
outstanding Class C Warrants, with an exercise price of $0.55 per share, which expire on May 19, 2027 and 31,150,000 shares of common stock subject to outstanding Class D Warrants with an exercise price of $0.80 per share, which expire on June 15,
2027 and underwriters warrants to purchase up to 552,000 shares of common stock at an exercise price of $1.375 per share, 1,724,998 shares of common stock at an exercise price of $2.00 per share and 2,090,909 shares of common stock at an exercise
price of $0.6875 per share. All of the 3,900,000 pre-funded warrants issued on March 23, 2022 were exercised, at a price of $0.01 per share, for an aggregate of 3,900,000 shares of common stock.
Each outstanding share of common stock is entitled to one vote, either in person or by proxy, on all matters that may be voted upon by their
holders at meetings of the stockholders. Holders of our common stock (i) have equal ratable rights to dividends from funds legally available therefore, if declared by the Board of Directors; (ii) are entitled to share ratably in all of our
assets available for distribution upon liquidation, dissolution or winding up; and (iii) do not have preemptive, subscription or conversion rights or redemption or sinking fund provisions. All issued common stock when issued will be fully paid
for and non-assessable.
Our stockholders have approved the amendment of the Companys
amended and restated articles of incorporation to effect one or more reverse stock splits of the shares of our common stock issued and outstanding at the time of the reverse split at an exchange ratio of between one-for-two and one-for-five hundred, with the Board of Directors to determine, in its sole discretion, whether to implement any
reverse stock split, as well as the specific timing and ratio, within such approved range of ratios; provided that any such split is implemented prior to the third anniversary of the Spin-Off.
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