DESCRIPTION OF CAPITAL STOCK
Authorized Capital
Under our articles of
incorporation, our authorized shares consist of 200,000,000 Class A common shares, par value $0.01 per share, 25,000,000 Class B common shares, par value $0.01 per share, 100 Class C common shares, par value $0.01 per share, and
150,000,000 shares of preferred shares, par value $0.01 per share. As of March 31, 2018, there were issued and outstanding 136,028,797 Class A common shares, no Class B common shares, no Class C common shares, no series A
preferred shares, no series B preferred shares, no series C preferred shares, 7,017,313 series D preferred shares, 5,415,937 series E preferred shares, 5,600,000 series F preferred shares, 7,800,800 series G preferred shares, 9,025,105 series H
preferred shares and no series R preferred shares.
We have proposed for approval at our April 27, 2018 annual general meeting a
resolution to amend our articles of incorporation to increase the number of authorized Class A common shares from 200,000,000 to 400,000,000, with corresponding increases in the number of authorized common shares from 225,000,100 to 425,000,100
and in the number of authorized shares of capital stock from 375,000,100 to 575,000,100.
Common Shares
Our Class A common shares are our only outstanding class of common shares.
Dividends
Under our articles of
incorporation, our common shareholders may receive quarterly dividends. Declaration and payment of any dividend is subject to the discretion of our board of directors. The time and amount of dividends will depend upon our financial condition, our
operations, our cash requirements and availability, debt repayment obligations, capital expenditure needs, restrictions in our debt instruments and our preferred shares, industry trends, the provisions of Marshall Islands law affecting the payment
of distributions to shareholders and other factors. The Marshall Islands Business Corporations Act, or the
BCA
, generally prohibits the payment of dividends other than from
paid-in
capital in excess of
par value and our earnings or while we are insolvent or would be rendered insolvent on paying the dividend.
Voting
Our common shares each have one vote. A majority of the common shares constitutes a quorum at meetings of the shareholders. Our series F
preferred shares are generally entitled to vote together as a single class with the holders of our common shares, on an
as-converted
basis. The 5,600,000 series F preferred shares outstanding are convertible
into class A common shares at a price of $18.00 per share, for a total of 7,777,777 common shares as of March 31, 2018.
Anti-takeover Effects
of Certain Provisions of Our Articles of Incorporation and Bylaws
Certain provisions of our articles of incorporation and bylaws,
which are summarized in the following paragraphs, may have an anti-takeover effect and may delay, defer or prevent a tender offer or takeover attempt that a shareholder might consider in its best interest, including those attempts that might result
in a premium over the market price for the shares held by shareholders.
Removal of Directors; Vacancies
Our articles of incorporation and bylaws provide that directors may be removed with cause upon the affirmative vote of holders of a majority of
the shares entitled to vote generally in the election of directors, voting together as a single class. In addition, our articles of incorporation and bylaws also provide that any vacancies on our board of directors and newly created directorships
will be filled only by the affirmative vote of a majority of the remaining directors, although less than a quorum.
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