Common use of Capitalization; Reverse Split Clause in Contracts

Capitalization; Reverse Split. The Buyer is aware of the Company’s current capitalization as set forth in Section 3(c) and Schedule 3(c) below. As such, the Buyer acknowledges that the Company currently does not have a sufficient number of authorized shares of preferred stock to issue the Series B Preferred Stock or a sufficient number of shares of authorized Common Stock to issue the Conversion Shares or the Warrant Shares but that, following the required shareholder vote, the filing of a certificate of designation for the Series B Preferred Stock and effectiveness of the Reverse Split, the Company will have sufficient authorized preferred stock to issue the Series B Preferred Stock and Common Stock to issue both the Conversion Shares and the Warrant Shares.

Capitalization; Reverse Split. The Buyer is aware of the Company’s current capitalization as set forth in Section 3(c) and Schedule 3(c) below. As such, the Buyer acknowledges that the Company currently does not have a sufficient number of authorized shares of preferred stock to issue the Series B C Preferred Stock or a sufficient number of shares of authorized Common Stock to issue the Conversion Shares or the Warrant Shares but that, following the required shareholder vote, the filing of a certificate of designation for the Series B C Preferred Stock and effectiveness of the Reverse Split, the Company will have sufficient authorized preferred stock to issue the Series B C Preferred Stock and Common Stock to issue both the Conversion Shares and the Warrant Shares.