DESCRIPTION OF SECURITIES
The following is a description of the material terms the Restated
Articles of Incorporation (“Restated Articles”) and
By-Laws, as amended, (“By-Laws”) of the Company. The
following description is intended to be a summary and may not
contain all of the information that is important to the reader. To
understand the material terms of our authorized capital stock, the
reader should read the Company’s Restated Articles and
By-Laws, copies of which were filed as exhibits to a Current Report
on Form 8-K filed by the Company with the SEC on February 6,
Company has 520,000,000 authorized shares of capital stock, $0.001
par value per share, of which 500,000,000 shares are common stock
(“Common Stock”) and 20,000,000 shares are preferred
stock (“Preferred Stock”).
outstanding shares of Common Stock are of the same class and have
equal rights and attributes. The holders Common Stock are entitled
to receive dividends from Company funds legally available therefor
only when, as and if declared by the Company’s board of
directors (the “Board”) and are entitled to share
ratably in all of the Company’s assets available for
distribution to holders of Common Stock upon the liquidation,
dissolution, or winding-up of the Company’s affairs. The
Company does not currently have a practice of paying dividends.
Holders of Common Stock do not have any preemptive, subscription,
redemption or conversion rights or sinking fund provisions. Holders
of Common Stock are entitled to one vote per share on all matters
they are entitled to vote upon at meetings of stockholders or upon
actions taken by written consent pursuant to Nevada corporate law.
The holders of Company Common Stock do not have cumulative voting
rights, this means that the holders of a plurality of the
outstanding shares can elect all of the Company’s directors.
All the shares of Company Common Stock currently issued and
outstanding are fully paid and nonassessable.
powers, rights, privileges or preferences have been designated for
the preferred stock. The Company’s board of directors is
authorized to divide the preferred stock into classes or series and
to designate powers, rights, privileges and preferences of any such
class or series of preferred stock including dividend rights,
conversion rights, voting rights, terms of redemption, liquidation
preferences and the number of shares constituting any class or
series, which may be greater than the rights of the holders of the
common stock by resolution before its issuance without a
stockholder vote or stockholder approval.
purpose of authorizing the Company’s board of directors to
issue preferred stock and determine its powers, rights, privileges
and preferences is to eliminate delays associated with a
stockholder vote on specific issuances. The issuance of preferred
stock, while providing flexibility in connection with possible
acquisitions, future financings and other corporate purposes, could
have the effect of making it more difficult for a third party to
acquire, or could discourage a third party from seeking to acquire,
a majority of the Company’s outstanding voting
Warrants and Options
are no warrants outstanding as of the date of this annual report.
The Company currently has options outstanding to two Company
employees, granted under the Company’s 2018 Equity Incentive
Plan, to purchase an aggregate of 120,000 shares of Common Stock.
Of these outstanding options, all are unvested and will vest and
become exercisable on October 6, 2020, assuming the option holders
satisfy the vesting conditions. The average weighted exercise price
of the options is $1.98. The options expire October 6, 2027. The
Company also has 3,655,000 shares of common stock that remain
available for issuance under its 2019 Equity Incentive