Red Cat Holdings, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Shareholders' Deficit and Series A Preferred Stock (Tables)

Shareholders' Deficit and Series A Preferred Stock (Tables)

12 Months Ended

Dec. 31, 2017

Balance of warrants outstanding for purchase of Company's common stock

	Common Shares Issuable Upon Exercise of Warrants		Exercise Price of Warrants		Date Issued	Expiration Date

Balance of warrants at December 31, 2015		—

Issued per Merger Agreement (1)		2,800,000	$	.58	9/9/2016	9/9/2021

Issued per Securities Purchase Agreement (2)		2,586,207	$	.58	9/9/2016	9/9/2021

Balance of warrants at December 31, 2016		5,386,207
Issued per offering (3)		2,500,003	$	.35	3/3/2017	9/3/2022
Issued per offering (4)		210,526	$	.35	8/21/2017	2/21/2023
Balance of warrants at December 31, 2017		8,096,736

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

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