Facing an avalanche of class action law suits, George Economou’s DryShips has announced the termination of its latest new share sale agreement with Kalani Investments.
In order to continue fundraising and increase confidence in the company, Economou has also agreed to acquire $100m of the company’s shares at an inflated price of $2.75 as well as not re-sell any of the shares he holds for a six month period.
Lastly, DryShips has also agreed not to conduct any equity offerings for the remainder of the year without the approval of the majority of its unaffiliated shareholders.
The triple whammy sent DryShips shares into overdrive on the Nasdaq on Friday, finishing well above the $2.75 paid by Economou at $3.10, up over 51%.
DryShips shares are still down 99.99% since January 1 and Friday’s move is unlikely to put a halt to the legal action from investors alleging the company has violated federal securities laws with its share sales to Kalani.