Common use of 03Capitalization Clause in Contracts

03Capitalization. The authorized capital stock of Purchaser consists of (i) 90,000,000 shares of Purchaser Stock, of which 6,237,462 shares are issued and outstanding as of the date hereof, and (ii) 10,000,000 shares of preferred stock, of which 2,000,000 are designated as Series A Preferred Stock (“Series A Preferred Stock”), and 1,000,000 shares are designated as Series B Preferred Stock (“Series B Preferred Stock”). As of the date hereof there are 400,000 shares of Series A Preferred Stock are issued and outstanding and no shares of Series B Preferred Stock issued and outstanding. All of the outstanding shares of Purchaser Stock and Series A Preferred Stock have been duly and validly authorized, and, to the extent applicable, are validly issued, fully paid and non-assessable. No shares of Purchaser Stock or Series A Preferred Stock are entitled to preemptive rights or registration rights and there are no outstanding options, warrants, scrip, rights to subscribe to, call or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of Purchaser. There are no contracts, commitments, understandings, or arrangements by which Purchaser is or may become bound to issue additional shares of the capital stock of Purchaser or options, securities or rights convertible into shares of capital stock of Purchaser. Purchaser is not a party to or bound by any agreement or understanding granting registration or anti-dilution rights to any person with respect to any of its equity or debt securities. Purchaser is not a party to, and it has no knowledge of, any agreement or understanding restricting the voting or transfer of any shares of the capital stock of Purchaser. The offer and sale of all capital stock, convertible securities, rights, warrants, or options of Purchaser issued prior to the Closing complied with all applicable federal and state securities laws, and to the best knowledge of Purchaser, no holder of such securities has a right of rescission or has made or threatened to make a claim for rescission or damages with respect thereto which could have a Material Adverse Effect. Purchaser has furnished or made available to the Shareholder and the Company true and correct copies of Purchaser’s Articles of Incorporation as in effect on the date hereof (the “Purchaser Charter”), and Purchaser’s Bylaws as in effect on the date hereof (the “Purchaser Bylaws”).

03Capitalization. The authorized capital stock capitalization of Purchaser SRSG consists solely of (i) 90,000,000 140,000,000 authorized shares of Purchaser common stock, $0.001 par value per share (the “SRSG Common Stock”), of which 6,237,462 7,361,005 shares are issued and outstanding as of the date hereof, outstanding; and (ii) 10,000,000 20,000,000 shares of preferred stock, $0.001 par value per share (the “SRSG Preferred Stock”), of which 2,000,000 are 1,000,000 shares have been designated as Series A Preferred Stock (“Series A Preferred Stock”), ” and 1,000,000 50,000 shares are have been designated as Series B Preferred Stock (“Series B D Preferred Stock”). As ” and of the date hereof there are 400,000 which 450,000 shares of Series A Preferred Stock are issued and outstanding and no 5,000 shares of Series B D Preferred Stock are issued and outstanding. All of the outstanding The 450,000 shares of Purchaser Stock and Series A Preferred Stock have been duly and validly authorized, and, to the extent applicable, are validly issued, fully paid and non-assessable. No shares of Purchaser Stock or issued Series A Preferred Stock are entitled convertible into 4,500,000 shares of SRSG Common Stock, and the 5,000 shares of issued Series D Preferred Stock are convertible into 5,000 shares of SRSG Common Stock. All outstanding SRSG Preferred Stock will be redeemed, repurchased, or converted into SRSG Common Stock prior to the Effective Time, in accordance with Sections 2.05(a), 7.09, 7.10 and 7.11 and Exhibit C hereto and the other terms and conditions of this Agreement. All issued and outstanding shares of SRSG Common Stock and SRSG Preferred Stock are legally issued, fully paid, and non-assessable and not subject to any preemptive rights or registration rights and there are no outstanding options, warrants, scrip, rights to subscribe to, call or commitments other right of any character whatsoever relating toPerson under any Law, SRSG’s Articles of Incorporation or securities Bylaws or rights convertible into, any shares of capital stock of Purchaser. There are no contracts, commitments, understandings, or arrangements by which Purchaser is or may become bound to issue additional shares of the capital stock of Purchaser or options, securities or rights convertible into shares of capital stock of Purchaser. Purchaser is not a party to or bound by any agreement or understanding granting registration or anti-dilution rights other instrument to any person with respect to any of its equity or debt securities. Purchaser which SRSG is not a party to, or by which SRSG may be bound. All issued and it has no knowledge of, any agreement or understanding restricting the voting or transfer of any shares of the capital stock of Purchaser. The offer and sale of all capital stock, convertible securities, rights, warrants, or options of Purchaser outstanding SRSG securities have been issued prior to the Closing complied in compliance with all applicable federal and state securities laws, and to the best knowledge . The authorized capitalization of Purchaser, no holder Merger Sub consists solely of such securities has a right 1,000 authorized shares of rescission or has made or threatened to make a claim for rescission or damages with respect thereto which could have a Material Adverse Effect. Purchaser has furnished or made available to the Shareholder and the Company true and correct copies of Purchaser’s Articles of Incorporation as in effect on the date hereof common stock (the “Purchaser CharterMerger Sub Common Stock”), $0.001 par value, of which 1,000 shares of common stock are issued and Purchaseroutstanding and held by SRSG, and no authorized, issued or outstanding shares of preferred stock. All issued and outstanding shares of Merger Sub Common Stock are legally issued, fully paid, and non-assessable and not subject to any preemptive or other right of any Person under any Law, Merger Sub’s Certificate of Incorporation or Bylaws or any agreement or other instrument to which Merger Sub or SRSG is a party or by which Merger Sub or SRSG may be bound. All issued and outstanding Merger Sub securities have been issued in compliance with applicable federal and state securities laws. There are no dividends, distributions or other amounts or interests due, issuable or payable with respect to any of the shares of capital stock of SRSG or Merger Sub, including, but not limited to, any amounts due, issuable or payable to any stockholder of SRSG pursuant to the exercise by any SRSG stockholder of appraisal rights or similar rights. Except as disclosed in effect on Section 3.03 of the SRSG Disclosure Schedule, as of the date hereof of this Agreement and upon the Closing there are and shall be no issued, outstanding or authorized options, warrants, purchase rights, subscription rights, stock purchase rights, restricted stock units or grants, dividend or distribution rights, debt or equity conversion rights, exchange rights, preemptive rights, registration rights, repurchase rights, vesting rights, lapses of restrictions, redemption rights, convertible notes or other Indebtedness instruments or convertible note or other Indebtedness obligations or other rights, contracts, instruments or understandings in regard to SRSG or Merger Sub capital stock or other securities or that could require SRSG or Merger Sub to issue, sell, acquire, exchange, convert, redeem or otherwise cause to become registered, acquired, issued or outstanding any of their respective capital stock or securities; and there are and shall be no outstanding or authorized stock appreciation, contingent value rights, phantom stock, profit participation, stock or equity awards, stock or equity grants, stock plans, equity or incentive or performance-based compensation or similar rights, securities, agreements, instruments or understandings with respect to SRSG or Merger Sub or their respective capital stock or securities; and there are and shall be no voting rights, voting trusts, proxies, or other rights, securities, agreements, instruments or understandings with respect to the voting of the capital stock, indebtedness or securities of SRSG or Merger Sub (any of the foregoing, “Purchaser BylawsSRSG Securities Rights”).