Item
3.02. Unregistered Sales of Equity Securities.
In
connection with the acquisition of Genomas, Inc., on September 27, 2017 Rennova Health, Inc. (the “Company”) issued
1,750,000 shares of Series F Convertible Preferred Stock (the “Series F Preferred Stock”). The following summary
of certain terms and provisions of the Company’s Series F Preferred Stock is subject to, and qualified in its entirety
by reference to, the terms and provisions set forth in the Company’s Amended Certificate of Designation of
Preferences, Rights and Limitations of Series F Preferred Stock.
General
.
Our board of directors has designated up to 1,750,000 shares of the 5,000,000 authorized shares of preferred stock as Series F
Preferred Stock.
Rank
.
The Series F Preferred Stock ranks on parity to our common stock.
Conversion
.
Each share of the Series F Preferred Stock is convertible into shares of our common stock (subject to adjustment as provided in
the related certificate of designation of preferences, rights and limitations) at any time after the first anniversary of the
issuance date at the option of the holder at a conversion price equal to the greater of $1.95 or the average closing price of
the Company’s common stock for the 10 trading days immediately preceding the conversion. The maximum number of shares of
common stock issuable upon the conversion of the Series F Preferred Stock is 897,436. The conversion price and the maximum
number of shares issuable upon conversion are subject to adjustment upon the effectiveness of the Company’s previously announced
1-for-15 reverse stock split. Any shares of Series F Preferred Stock outstanding on the fifth anniversary of the issuance
date will be mandatorily converted into common stock at the applicable conversion price on such date.
Liquidation
Preference
. In the event of our liquidation, dissolution or winding-up, holders of Series F Preferred Stock will be entitled
to receive the same amount that a holder of common stock would receive if the Series F Preferred Stock were fully converted into
shares of our common stock at the conversion price (assuming for such purposes that the Series F Preferred Stock is then convertible)
which amounts shall be paid pari passu with all holders of common stock.
Voting
Rights
. Each share of Series F Preferred Stock shall have one vote, and the holders of the Series F Preferred Stock shall
vote together with the holders of our common stock as a single class.
Dividends
.
The holders of the Series F Preferred Stock will participate, on an as-if-converted-to-common stock basis, in any cash dividends
to the holders of common stock.
Redemption
.
At any time, from time to time after the first anniversary of the issuance date, we have the right to redeem all or any portion
of the outstanding Series F Preferred Stock at a price per share equal to $1.95 plus any accrued but unpaid dividends.
Negative
Covenants
. As long as any shares of Series F Preferred Stock are outstanding, the Company may not amend, alter or repeal any
provision of our certificate of incorporation, the certificate of designation or our bylaws in a manner that materially adversely
affects the powers, preferences or rights of the Series F Preferred Stock.
The issuance of the
shares of Series F Preferred Stock was exempt from the registration requirements of the Securities Act of 1933, as amended, in
accordance with Section 4(a)(2) thereof, as a transaction by an issuer not involving a public offering.
The
foregoing description of the Series F Preferred Stock does not purport to be complete and is qualified in its entirety by reference
to the Amended Certificate of Designation for the Series F Preferred Stock, which is filed as an exhibit to this Current Report
on Form 8-K and is incorporated herein by reference.