Common use of 2Capitalization Clause in Contracts

2Capitalization. (a) The authorized capital of the Company consists, immediately prior to the Closing, of: (i) An unlimited number of Common Shares, with 18,961,116 Common Shares issued and outstanding immediately prior to the Closing. All of the outstanding Common Shares have been duly authorized, are fully paid and nonassessable and were issued in compliance with all Applicable Securities Laws (as herein defined). (ii) An unlimited number of preferred shares (the “Preferred Shares”), issuable in series, which includes 70,000,000 Series 1 Preferred Shares, none of which are issued and outstanding immediately prior to the Closing and an unlimited number of Series 2 Preferred Shares (the “Series 2 Preferred Shares”), 1,166,667 are issued and outstanding immediately prior to the Closing which are convertible into Common Shares in accordance with their terms. (b) The Company has reserved 3,792,223 Common Shares for issuance to officers, directors, employees and consultants of the Company pursuant to its stock option plan (the “Stock Option Plan”). Said Stock Option Plan was duly adopted by the Board and approved by the Company shareholders. Of such reserved Common Shares, stock options to purchase 1,152,597 Common Shares have been granted and are currently outstanding. ​ ​ (c) The Company has reserved 1,000,000 Common Shares for issuance to officers, directors, employees and consultants of the Company pursuant to its deferred share unit plan (the “DSU Plan”). Said DSU Plan was duly adopted by the Board and approved by the Company shareholders. Of such reserved Common Shares, deferred share units to purchase 1,061 Common Shares have been granted and are currently outstanding. (d) Section 2.2(d) of the Disclosure Schedule sets forth the capitalization of the Company immediately following the Closing, which assumes: (i) the issuance of Common Shares in consideration for the Offering Amount; and (ii) the conversion of the 1,166,667 Series 2 Preferred Shares into 1,166,667 Common Shares, assuming the full Offering Amount is raised under the Offering. Except as set forth in the Disclosure Schedule, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal or similar rights) or agreements, orally or in writing, to purchase or acquire from the Company any Common Shares or Preferred Shares or any securities convertible into or exchangeable for Common Shares or Preferred Shares. (e) Other than holders of Series 2 Preferred Shares, no holder of outstanding securities of the Company or the Subsidiary will be entitled to any preemptive or any similar rights to subscribe for any of the Common Shares or other securities of the Company or the Subsidiary, and other than the Series 2 Preferred Shares, there no rights, warrants or options to acquire, or instruments convertible into or exchangeable for, any shares in the capital of the Company or the Subsidiary are outstanding.

2Capitalization. ​ (a) The authorized capital of the Company consists, immediately prior to the Initial Closing, of:: ​ (i) An unlimited number of Common Shares, with 18,961,116 7,195,529 Common Shares issued and outstanding immediately prior to the Initial Closing. All of the outstanding Common Shares have been duly authorized, are fully paid and nonassessable and were issued in compliance with all applicable federal, provincial, state and local laws and regulations in the United States and Canada (hereinafter “Applicable Securities Laws (as herein definedLaws”).. ​ (ii) An unlimited number of preferred shares (the “Preferred Shares”), issuable in series, which includes 70,000,000 Series 1 Preferred Shares, none 70,000,000 of which are issued and outstanding immediately prior to the Closing and an unlimited number of Series 2 Preferred Shares (the “Series 2 Preferred Shares”), 1,166,667 are issued and outstanding immediately prior to the Closing which are convertible into Common Shares in accordance with their terms.Initial Closing. ​ (b) The Company has reserved 3,792,223 1,019,835 Common Shares for issuance to officers, directors, employees and consultants of the Company pursuant to its stock option plan (the “Stock Option Plan”). Said Stock Option Plan was duly adopted by the Board and approved by the Company shareholders. Of such reserved Common Shares, stock options to purchase 1,152,597 834,691 Common Shares have been granted and are currently outstanding. ​ ​ (c) The Company has reserved 1,000,000 16,666 Common Shares for issuance to officers, directors, employees and consultants of the Company pursuant to its deferred share unit plan (the “DSU Plan”). Said DSU Plan was duly adopted by the Board and approved by the Company shareholders. Of such reserved Common Shares, deferred share units to purchase 1,061 Common Shares have been granted and are currently outstanding.. ​ (d) Section 2.2(d) of the Disclosure Schedule sets forth the capitalization of the Company immediately following the Closinga Subsequent Closing(s), which assumes: (i) assumes the issuance of Common Shares in consideration for the Offering Maximum Amount; and (ii) the conversion of the 1,166,667 Series 2 Preferred Shares into 1,166,667 Common Shares, assuming the full Offering Amount is raised under the Offering. Except as set forth in the Disclosure Schedule, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal or similar rights) or agreements, orally or in writing, to purchase or acquire from the Company any Common Shares or Preferred Shares or any securities convertible into or exchangeable for Common Shares or Preferred Shares.. ​ (e) Other than holders of Series 2 Preferred SharesExcept as disclosed in the Memorandum, no holder of outstanding securities of the Company or the Subsidiary will be entitled to any preemptive pre-emptive or any similar rights to subscribe for any of the Common Shares or other securities of the Company or the Subsidiary, and other than the Series 2 Preferred Shares, there no rights, warrants or options to acquire, or instruments convertible into or exchangeable for, any shares in the capital of the Company or the Subsidiary are outstanding.

2Capitalization. (a) The authorized capital of the Company consists, immediately prior to the Closing, of: (i) An unlimited number of 20,000,000 shares of Common SharesStock, with 18,961,116 Common Shares 7,450,000 shares of which are issued and outstanding immediately prior to the Closing. All of the outstanding shares of Common Shares Stock have been duly authorized, are fully paid and nonassessable and were issued in compliance with all Applicable Securities Laws (applicable federal and state securities Laws. Except as herein defined). (iiset forth on Section 2.2(a) An unlimited number of preferred shares (the “Preferred Shares”)Disclosure Schedule, issuable the Company holds no Common Stock in series, which includes 70,000,000 Series 1 Preferred Shares, none of which are issued and outstanding immediately prior to the Closing and an unlimited number of Series 2 Preferred Shares (the “Series 2 Preferred Shares”), 1,166,667 are issued and outstanding immediately prior to the Closing which are convertible into Common Shares in accordance with their termsits treasury. (b) The Company has reserved 3,792,223 7,500,000 shares of Common Shares Stock for issuance to officers, directors, employees and consultants of the Company pursuant to its stock option plan (the “Stock Option Plan”). Said Stock Option 2019 Equity Incentive Plan was duly adopted by the Board of Directors and approved by the Company shareholdersstockholders (the “Stock Plan”). Of such reserved shares of Common SharesStock, 650,000 shares have been issued pursuant to restricted stock purchase agreements of which 50,000 have been purchased back by the Company, options to purchase 1,152,597 Common Shares 450,000 shares have been granted and are currently outstanding. ​ ​ (c) The Company has reserved 1,000,000 , and 6,450,000 shares of Common Shares Stock remain available for issuance to officers, directors, employees and consultants pursuant to the Stock Plan. The Company has furnished to Purchaser complete and accurate copies of the Company pursuant to its deferred share unit plan (the “DSU Plan”). Said DSU Stock Plan was duly adopted by the Board and approved by the Company shareholders. Of such reserved Common Shares, deferred share units to purchase 1,061 Common Shares have been granted and are currently outstandingforms of agreements used thereunder. (dc) Section 2.2(d2.2(c) of the Disclosure Schedule sets forth the capitalization of the Company immediately following the Closing, which assumesClosing including the number of shares of the following: (i) the issuance issued and outstanding Common Stock, including, with respect to restricted Common Stock, vesting schedule and repurchase price; (ii) outstanding stock options, including vesting schedule and exercise price; (iii) shares of Common Shares in consideration Stock reserved for future award grants under the Offering AmountStock Plan; and (iiiv) warrants or stock purchase rights, if any. Except for (A) the conversion privileges of the 1,166,667 Series Shares to be issued under this Agreement, (B) the rights provided in Sections 2 Preferred Shares into 1,166,667 Common Sharesand 3.2 of the Stockholders’ Agreement, assuming and (C) the full Offering Amount is raised under the Offering. Except as set forth securities and rights described in Section 2.2(b) of this Agreement and Section 2.2(c) of the Disclosure Schedule, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal or similar rights) or agreements, orally or in writing, to purchase or acquire from the Company any shares of Common Shares Stock or Preferred Shares preferred stock, or any securities convertible into or exchangeable for shares of Common Shares Stock or Preferred Sharespreferred stock. All outstanding shares of the Company’s Common Stock and all shares of the Company’s Common Stock underlying outstanding options are subject to (i) a right of first refusal in favor of the Company upon any proposed transfer (other than transfers for estate planning purposes); and (ii) a lock-up or market standoff agreement of not less than one hundred eighty (180) days following the Company’s initial public offering pursuant to a registration statement filed with the Securities and Exchange Commission under the Securities Act. (ed) Other than holders of Series 2 Preferred Shares, no holder of outstanding securities None of the Company’s stock purchase agreements or stock option documents contains a provision for acceleration of vesting (or lapse of a repurchase right) or other changes in the vesting provisions or other terms of such agreement or understanding upon the occurrence of any event or combination of events, including, without limitation, in the case where the Company’s Stock Plan is not assumed in an acquisition. The Company has never adjusted or amended the Subsidiary will be entitled to exercise price of any preemptive stock options previously awarded, whether through amendment, cancellation, replacement grant, repricing, or any similar rights other means. The Company has no obligation (contingent or otherwise) to subscribe for purchase or redeem any of the Common Shares or other securities of the Company or the Subsidiary, and other than the Series 2 Preferred Shares, there no rights, warrants or options to acquire, or instruments convertible into or exchangeable for, any shares in the its capital of the Company or the Subsidiary are outstandingstock.