On January 13, 2023, Clearday, Inc. closed the transaction. On the same date, the company paid the Lender a commitment fee of 83,160 shares of our common stock that are earned in full on the Closing Date and are restricted securities under the Securities Act. On the Closing Date, we also issued two warrants to the Lender.

One warrant may be exercised for 1,134,000 shares of our common stock from and after an Event of Default under the Note at a price per share of $0.75. The other warrant a warrant may be exercised for 851,000 shares of our common stock from and after February 14, 2023 at a price per share of $0.75. Each of the Note Warrant and the Other Warrant provide for customary “cashless” exercise of such warrant and adjustments to the exercise price and shares underlying each warrant, including adjustment in the event of an issuance of common stock or deemed issuance of common stock at a price that is lower than the then exercise price on a “full rachet” basis.