Series C Preferred Stock

On February 23, 2019, the number, designation, rights, preferences and privileges of the Series C Preferred Stock were established by the Board, which are set forth in a Certificate of Designations that was filed with the Secretary of State of the State of Delaware on February 27, 2019. Among other things, the Certificate of Designation provides that each one share of Series C Preferred has voting rights equal to (x) (i) 0.019607 multiplied by the total issued and outstanding Common Stock eligible to vote at the time of the respective vote (the number determined by this clause (i), the “Numerator”), divided by (ii) 0.49, minus (y) the Numerator. These voting rights apply only to matters of Company capitalization (i.e. increase in authorized common stock, stock splits, etc.), and similar matters upon which stockholders are entitled to vote or to which stockholders are entitled to give consent. The Series C has a par value of $0.001 per share, no rights to dividends but provides for liquidation rights which entitle the holder to a pro-rata share of net assets. Each Series C share is convertible, at the option of the holder, into one share of Common Stock.

The Board on March 18, 2019 authorized the issuance, of the 51 authorized shares of Series C Preferred stock to Jan Telander, our Chief Executive Officer, so that he will be able, as the stockholder with a majority of the voting power of the Company’s outstanding stock, to authorize the amendment of our Certificate of Incorporation to increase the number of our authorized shares of common stock,. The matters on which the Series C Preferred Stock is entitled to vote are solely matters of Company capitalization (i.e. increase in authorized common stock, stock splits, etc.), and similar matters that are require amendment of our Certificate of Incorporation for capital raising purposes.