Our corporate governance practices are in compliance with the laws of the Republic of the Marshall Islands. We are exempt from many of NASDAQ’s corporate governance practices other than the requirements regarding the disclosure of a going concern audit opinion, submission of a listing agreement, notification of material non-compliance with NASDAQ corporate governance practices, and the establishment and composition of an audit committee and a written audit committee charter.

The practices that we expect to follow in lieu of NASDAQ’s corporate governance rules include:

• in lieu of obtaining an independent review of related party transactions for conflicts of interests, consistent with Marshall Islands law, a related party transaction will be permitted if: (i) the material facts as to his/her relationship or interest and as to the contract or transaction are disclosed or are known to our board of directors and the board 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 the board as defined in Section 55 of the Marshall Islands Business Corporations Act, by unanimous vote of the disinterested directors; or (ii) the material facts as to his/her relationship or interest are disclosed and the shareholders are entitled to vote thereon, and the contract or transaction is specifically approved in good faith by a simple majority vote of the shareholders; or (iii) the contract or transaction is fair to us at the time it is authorized, approved or ratified, by the 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 the board of directors or of a committee which authorizes the contract or transaction;
• as a foreign private issuer, we will not be required to solicit proxies or provide proxy statements to NASDAQ pursuant to our corporate governance rules or Marshall Islands law. Consistent with Marshall Islands law, we intend to notify our shareholders between 15 and 60 days before the meeting. This notification will contain, among other things, information regarding business to be transacted at the meeting. In addition, our bylaws provide that shareholders must give us advance notice to properly introduce any business at a shareholder meeting and they may designate in writing a proxy to act on their behalf;
• in lieu of holding regular meetings at which only independent directors are present, our entire board of directors, a majority of whom are independent, will hold regular meetings as is consistent with the laws of the Republic of the Marshall Islands;
• we have adopted an equity incentive plan and in the future may amend or terminate this plan or approve a new incentive plan. Shareholder approval will not be required to amend or terminate this equity incentive plan or to establish a new equity incentive plan since Marshall Islands law permits the board of directors to take these actions;
• as a foreign private issuer, we will not be required to obtain shareholder approval if any of our directors, officers or 5% or greater shareholders will have a 5% or greater interest (or such persons collectively have a 10% or greater interest), directly or indirectly, in a company or assets to be acquired or in the consideration to be paid in the transaction(s) and the present or potential issuance of common stock, or securities convertible into or exercisable for common stock, could result in an increase in outstanding common stock or voting power of 5% or more; and
• in lieu of obtaining shareholder approval prior to the issuance of securities, we intend to comply with provisions of the Marshall Islands Business Corporations Act, providing that the board of directors approves share issuances.