Item 5.03 Amendments to the Articles of Incorporation; Change in
Fiscal Year
Creation of Series B Convertible Preferred
Stock
On January 24, 2023, the Company,
filed the Certificate of Designation of the Preferences, Rights and Limitations of the Series B Convertible Preferred Stock of the Company
(the “Certificate of Designation”) setting forth the preferences, rights and limitations of the Company’s newly designated
Series B convertible preferred stock, par value $0.0001 per share (the “Preferred Stock”) with the Secretary of State of the
State of Delaware. The Certificate of Designation became effective upon filing.
Converison
Each share of the Preferred
Stock will be convertible into 42.3657 shares of the Company’s common stock (the “Common Stock”) at the option of the
holder at any time, subject to certain limitations, including that the holder will be prohibited from converting Preferred Stock into
Common Stock if, as a result of such conversion, the holder, together with its affiliates, would beneficially own a number of shares of
Common Stock above a conversion blocker, which is initially set at 9.99% (the “Conversion Blocker”) of the total Common Stock
then issued and outstanding immediately following the conversion of such shares of Preferred Stock. Holders of the Preferred Stock are
permitted to increase the Conversion Blocker to an amount not to exceed 19.99% upon 61 days’ prior notice.
Ranking; Liquidation Preference
The Preferred Stock ranks
(i) senior to the Common Stock; (ii) senior to all other classes and series of equity securities of the Company that by their terms do
not rank senior to the Preferred Stock (“Junior Stock”); (iii) senior to all shares of the Company’s Series A Convertible
Preferred Stock; (iv) on parity with any class or series of capital stock of the Company hereafter created specifically ranking by its
terms on parity with the Preferred Stock (the “Parity Stock”); (v) junior to any class or series of capital stock of the Company
hereafter created specifically ranking by its terms senior to any Preferred Stock (“Senior Stock”); and (vi) junior to all
of the Company’s existing and future debt obligations, including convertible or exchangeable debt securities, in each case, as to
distributions of assets upon liquidation, dissolution or winding up of the Corporation, whether voluntarily or involuntarily and as to
the right to receive dividends.
In the event of the liquidation,
dissolution or winding up of the affairs of the Company, whether voluntary or involuntary, after payment or provision for payment of the
debts and other liabilities of the Company, and subject to the prior and superior rights of any Senior Stock, each holder of shares of
Preferred Stock will be entitled to receive, in preference to any distributions of any of the assets or surplus funds of the Company to
the holders of the Common Stock and any of the Company’s securities that are Junior Stock and pari passu with any distribution to
the holders of any Parity Stock, an amount equal to $1.00 per share of Preferred Stock, plus an additional amount equal to any dividends
declared but unpaid on such shares, before any payments shall be made or any assets distributed to holders of the Common Stock or any
of our securities that Junior Stock.
Voting Rights
So long as any shares of the
Preferred Stock remain outstanding, the Company shall not, without the affirmative vote or consent of the holders of majority of the shares
of the Preferred Stock then-outstanding, given in person or by proxy, either in writing or at a meeting, in which the holders of the Preferred
Stock vote separately as a class: (a) amend, alter, modify or repeal (whether by merger, consolidation or otherwise) the Certificate of
Designation, the Certificate of Incorporation of the Company, or the Company’s bylaws in any manner that adversely affects the rights,
preferences, privileges or the restrictions provided for the benefit of, the Preferred Stock; (b) issue further shares of Preferred Stock
or increase or decrease (other than by conversion) the number of authorized shares of Preferred Stock; (c) authorize or issue any Senior
Stock; or (d) enter into any agreement to do any of the foregoing that is not expressly made conditional on obtaining the affirmative
vote or written consent of the majority of then-outstanding Preferred Stock.
Dividends
Shares of the Preferred Stock are entitled to receive
any dividends payable to holders of Common Stock on an as-converted-to common-stock basis.
Exchange Listing
The Company does not intend to apply for listing
of the Preferred Stock on any securities exchange or other trading system.
The foregoing description of the Certificate of
Designation and the summary of the preferences, rights, and limitations of the Preferred Stock described above does not purport to be
complete and is qualified in its entirety by reference to the Certificate of Designation, a copy of which is being filed as Exhibit 3.1
hereto and is incorporated by reference herein.
Note Regarding Forward-Looking Statements
This Current Report on Form
8-K includes forward-looking statements about the Company’s future plans and prospects, and financial results. The words "anticipate,"
"believe," "estimate," "expect," "intend," "may," "plan," "predict,"
"project," "target," "potential," "will," "would," "could," "should,"
"continue," and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements
contain these identifying words. Each forward-looking statement is subject to risks and uncertainties that could cause actual results
to differ materially from those expressed or implied in such statement.
These risks and uncertainties include the risk
that the Private Placement does not close on the expected timing, or at all. Other risks and uncertainties include those identified under
the heading “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the quarterly periods ended September
30, 2022, as filed with the SEC on November 3, 2022, and June 30, 2022, as filed with the SEC on August 8, 2022, its Annual Report on
Form 10-K for the year ended December 31, 2021 as filed with the SEC on March 18, 2021 and in any subsequent filings with the SEC. The
forward-looking statements contained in this Current Report on Form 8-K reflect the Company’s views as of the date hereof, and the
Company does not assume and specifically disclaims any obligation to update any forward-looking statements whether as a result of new
information, future events or otherwise, except as required by law.