Sugarmade Inc (SGMD)

[Moeclay]

"Notwithstanding that the Investment Agreement is in an amount of $20,000,000, we anticipate that the actual likelihood that we will be able access the full amount of the Investment Agreement is low due to several factors, including that our ability to access the Investment Agreement is impacted by our average daily trading volume, which may limit the maximum dollar amount of each put we deliver to K&J, and our stock price. Our use of the Investment Agreement will continue to be limited and restricted if our share trading volume or and market price of our stock continue at their current levels or decrease further in the future from the volume and stock prices reported over the past year. Further, if the price of our stock remains at $0.035 per share (which represents the average of the high and low reported sales prices of our shares of Common Stock on June 14, 2019, the sale by K&J of all 138,461,538 of the shares registered in this Prospectus would mean we would receive only $4,846,154 from our sale of shares under the Investment Agreement. Our ability to issue shares in excess of the 138,461,538 shares covered by the Registration"