Company: KAVL
Filing Date: 2025-03-03
Form Type: DEF 14C
Source: 0001731122-25-000319
Chunk: 5

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-03-03
Form: DEF 14C
Chunk 5
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However, the reduction in the number of issued and
outstanding shares of Common Stock following implementation of the Reverse Split, if implemented, could adversely affect the trading market
for our Common Stock by reducing the relative level of liquidity of the shares of Common Stock. Further, there can be no assurance that
the Reverse Split will result in a proportionate increase or, for that matter, any increase, in the price of the shares of Common Stock
on Nasdaq.

Any new shares issued following the Effective Date
of the Reverse Split will be fully-paid and non-assessable shares. On the Effective Date of the Reverse Split, the number of stockholders
will remain unchanged because those stockholders who would otherwise only be entitled to receive a fractional share will receive a number
of shares rounded up to the next whole number.

<div align='center'>4</div>

The Reverse Split will not change the number of authorized
shares of Common Stock, which will continue to be 1,000,000,000 shares of Common Stock, or the par value of our Common Stock, which will
continue to be $0.001 per share. While the aggregate par value of our outstanding Common Stock will be reduced as a result of the Reverse
Split, our additional paid-in capital will be increased by a corresponding amount. Therefore, the Reverse Split will not affect our total
stockholders’ equity. All share and per share information will be retroactively adjusted to reflect the Reverse Split for all periods
presented in our future financial reports and regulatory filings.

On February 28,, 2025, the trading date immediately
preceding the filing of the Definitive Information Statement on Schedule 14C, the closing price of our shares of Common Stock on Nasdaq
was $0.8265 and the total market value was approximately $9,539,712 based on the 11,542,302 shares of Common Stock issued and outstanding.

Rationale for the Reverse Split

The Board of Directors believes that a Reverse Split
should, at least initially, and based upon reverse split of the issued and outstanding shares of Common Stock at an assumed ratio of one-for-ten
(1:10), which is the midpoint between the split ratio range of one-for-two (1:2) and one-for-twenty (1:20), and $0.8265 stock price as
of February 28, 2025, increase the price of our shares of Common Stock to approximately $8.265 per share. Our stock