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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported):
May 29, 2024
NEONODE INC.
(Exact name of issuer of securities held pursuant
to the plan)
Commission File Number 001-35526
Delaware |
|
94-1517641 |
(State or other jurisdiction
of incorporation) |
|
(I.R.S. Employer
Identification No.) |
Karlavägen 100, 115 26 Stockholm, Sweden
(Address of Principal Executive Office, including
Zip Code)
+46 (0) 702958519
Registrant’s telephone number, including
area code:
Not Applicable
(Former name or former address, if changed since
last report)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
☐ | Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which registered |
Common Stock, par value $0.001 per share |
|
NEON |
|
The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry Into a Material Definitive
Agreement.
On June 4, 2024, Neonode
Inc. (the “Company”) entered into an At The Market Offering Agreement (the “Sales Agreement”) with Ladenburg Thalmann
& Co. Inc. (“Ladenburg”) with respect to an “at the market” offering program, under which the Company may,
from time to time, in its sole discretion, issue and sell through Ladenburg, acting as agent or principal, shares of the Company’s
common stock, par value $0.001 per share (the “Shares”), initially having an aggregate offering price of up to $10,336,156.
On June 4, 2024, the
Company filed a prospectus supplement with the Securities and Exchange Commission (the “Prospectus Supplement”) in connection
with the offer and sale of the Shares pursuant to the Sale Agreement. The issuance and sale of the Shares by the Company under the Sale
Agreement will be made pursuant to the Company’s registration statement on Form S-3 (File No. 333-279252) filed with the SEC on
May 9, 2024 and declared effective on May 16, 2024 (the “Registration Statement”), as supplemented by the Prospectus Supplement.
Pursuant to the Sales
Agreement, Ladenburg may sell the Shares by any method permitted that is deemed an “at the market” offering as defined in
Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”). Ladenburg will use commercially reasonable efforts
consistent with its normal trading and sales practices to sell the Shares from time to time, based upon instructions from the Company
(including any price or size limits or other customary parameters or conditions the Company may impose).
The Company will pay
Ladenburg a commission of 3.0% of the gross sales price per Share sold under the Sales Agreement. The Company also agreed to reimburse
Ladenburg for certain specified expenses, including the fees and disbursements of its counsel, in an amount not to exceed $50,000.
The Company is not obligated
to sell any Shares under the Sales Agreement. The offering of the Shares pursuant to the Sales Agreement will terminate upon the earlier
to occur of (i) the issuance and sale, through or to Ladenburg, of all of the Shares subject to the Sales Agreement and (ii) termination
of the Sales Agreement in accordance with its terms.
The Sales Agreement contains
representations, warranties and covenants that are customary for transactions of this type. In addition, the Company has agreed to indemnify
Ladenburg against certain liabilities, including liabilities under the Securities Act and the Securities Exchange Act of 1934, as amended.
The foregoing description
of the Sales Agreement is not complete and is qualified in its entirety by reference to the full text of the Sales Agreement, a copy of
which is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The opinion of Reed Smith
LLP, the Company’s counsel, regarding the legality of the Shares that may be issued pursuant to the Sales Agreement, is filed herewith
as Exhibit 5.1.
The Shares will be sold
pursuant to the Registration Statement, and offerings of the Shares will be made only by means of the Prospectus Supplement and the accompanying
prospectus. This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy the securities
discussed herein, nor shall there be any offer, solicitation or sale of the securities in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
Item 1.02 Termination
of a Material Definitive Agreement.
On May 29, 2024, the Company terminated its At
Market Issuance Sales Agreement, dated May 7, 2021, by and between the Company and B. Riley Securities, Inc. (the “Prior Sales
Agreement”), pursuant to which the Company was able sell shares of common stock in “at the market offerings” as defined
by Rule 415 of the Securities Act. The Company previously filed a prospectus, dated May 18, 2021, relating to the at the market offering
of shares of common stock pursuant to the Prior Sales Agreement (the “ATM Prospectus”). The offering pursuant to the ATM
Prospectus was terminated in connection with the termination of the Prior Sales Agreement. B. Riley Securities, Inc. waived the termination
notice period provided under the Prior Sales Agreement such that the termination was effective immediately. Following such termination,
the Company may not offer or sell any additional shares of its common stock under the Prior Sales Agreement and ATM Prospectus. The Company
sold 2,025,503 shares of common stock having an aggregate offering price of approximately $15.0 million pursuant to the Prior Sales Agreement.
Item 9.01. Financial Statements and Exhibits.
| * | Certain portions of this Exhibit have been omitted pursuant
to Regulation S-K Item 601(a)(6) promulgated under the Exchange Act. The Company agrees to furnish supplementally a copy of any omitted
schedule to the SEC upon request. |
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
Date: June 4, 2024 |
NEONODE INC. |
|
|
|
|
By: |
/s/ Fredrik Nihlén |
|
Name: |
Fredrik Nihlén |
|
Title: |
Interim President and Chief Executive Office and Chief Financial Officer |
2
Exhibit 5.1
June 4, 2024
Neonode Inc.
Karlavägen 100
115 26 Stockholm, Sweden
Ladies and Gentlemen:
We have acted as counsel to
Neonode Inc., a Delaware corporation (the “Company”), in connection with the offer and sale by the Company of up to
$10,366,156 of shares (the “Shares”) of the Company’s voting common stock, par value $0.001 per share, pursuant
to that certain At the Market Offering Agreement, dated as of June 3, 2024, by and between the Company and Ladenburg Thalmann Co. Inc.
as sales agent (the “Sales Agreement”). The Shares will be offered and sold pursuant to the Company’s effective
Registration Statement on Form S-3 (File No. 333-279252) (the “Registration Statement”) filed with the Securities and
Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”),
relating to the sale of the Shares as set forth in a prospectus supplement, dated June 3, 2024 (the “Prospectus Supplement”),
supplementing the prospectus, dated May 16, 2024, included in the Registration Statement (the “Base Prospectus”).
In rendering the opinion set
forth herein, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate
records, certificates of public officials and other instruments as we have deemed necessary or advisable.
In such examination, we have
assumed the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all items submitted to us as originals,
the conformity with originals of all items submitted to us as copies, and the authenticity of the originals of such copies. As to any
facts material to the opinions expressed herein that we did not independently establish or verify, we have relied upon statements and
representations of officers and other representatives of the Company and public officials.
This opinion is based solely
on the General Corporation Law of the State of Delaware.
Based upon and subject to
the foregoing, we are of the opinion that the Shares have been duly authorized for issuance, and when issued and delivered by the Company
pursuant to the provisions of the Sales Agreement against payment of the requisite consideration therefor, will be validly issued, fully
paid and nonassessable.
The opinions set forth herein
are given as of the date hereof, and we undertake no obligation to update or supplement this opinion letter if any applicable law changes
after the date hereof or if we become aware of any fact or other circumstances that changes or may change our opinion set forth herein
after the date hereof or for any other reason.
We consent to the inclusion
of this opinion as an exhibit to the Company’s Current Report on Form 8-K filed on June 3, 2024 and further consent to all references
to us under the caption “Legal Matters” in the Prospectus Supplement and Prospectus constituting a part of the Registration
Statement. In giving this consent, we do not admit that we are in the category of persons whose consent is required under Section 7
of the Securities Act or the rules and regulations of the Commission.
|
Very truly yours, |
|
|
|
/s/ Reed Smith LLP |
|
REED SMITH LLP |
Exhibit 10.1
CERTAIN PERSONALLY IDENTIFIABLE INFORMATION HAS BEEN OMITTED FROM THIS EXHIBIT PURSUANT TO ITEM 601(A)(6) OF REGULATION S-K. [***] INDICATES
THAT INFORMATION HAS BEEN REDACTED.
AT THE MARKET OFFERING AGREEMENT
June 4, 2024
Ladenburg Thalmann & Co. Inc.
640 Fifth Avenue, 4th Floor
New York, NY 10019
Ladies and Gentlemen:
Neonode Inc., a corporation
organized under the laws of Delaware (the “Company”), confirms its agreement (this “Agreement”)
with Ladenburg Thalmann & Co. Inc. (the “Manager”) as follows:
1. Definitions.
The terms that follow, when used in this Agreement and any Terms Agreement, shall have the meanings indicated.
“Accountants” shall
have the meaning ascribed to such term in Section 4(m).
“Act”
shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.
“Action”
shall have the meaning ascribed to such term in Section 3(o).
“Affiliate”
shall have the meaning ascribed to such term in Section 3(n).
“Applicable
Time” shall mean, with respect to any Shares, the time of sale of such Shares pursuant to this Agreement or any relevant Terms
Agreement.
“Base Prospectus”
shall mean the base prospectus contained in the Registration Statement at the Execution Time.
“Board”
shall have the meaning ascribed to such term in Section 2(b)(iii).
“Broker
Fee” shall have the meaning ascribed to such term in Section 2(b)(v).
“Business
Day” shall mean any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, that, for purposes of clarity, commercial banks shall not be deemed
to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential
employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of
any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The
City of New York generally are open for use by customers on such day.
“Commission”
shall mean the United States Securities and Exchange Commission.
“Common
Stock” shall have the meaning ascribed to such term in Section 2.
“Common
Stock Equivalents” shall have the meaning ascribed to such term in Section 3(g).
“Company
Counsel” shall have the meaning ascribed to such term in Section 4(l).
“DTC”
shall have the meaning ascribed to such term in Section 2(b)(vii).
“Effective
Date” shall mean each date and time that the Registration Statement and any post-effective amendment or amendments thereto became
or becomes effective.
“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated
thereunder.
“Execution
Time” shall mean the date and time that this Agreement is executed and delivered by the parties hereto.
“Free Writing
Prospectus” shall mean a free writing prospectus, as defined in Rule 405.
“GAAP”
shall have the meaning ascribed to such term in Section 3(m).
“Incorporated
Documents” shall mean the documents or portions thereof filed with the Commission on or prior to the Effective Date that are
incorporated by reference in the Registration Statement or the Prospectus and any documents or portions thereof filed with the Commission
after the Effective Date that are deemed to be incorporated by reference in the Registration Statement or the Prospectus.
“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3(v).
“Issuer
Free Writing Prospectus” shall mean an issuer free writing prospectus, as defined in Rule 433.
“Losses”
shall have the meaning ascribed to such term in Section 7(d).
“Material
Adverse Effect” shall have the meaning ascribed to such term in Section 3(b).
“Material
Permits” shall have the meaning ascribed to such term in Section 3(s).
“Net Proceeds”
shall have the meaning ascribed to such term in Section 2(b)(v).
“Permitted
Free Writing Prospectus” shall have the meaning ascribed to such term in Section 4(g).
“Placement”
shall have the meaning ascribed to such term in Section 2(c).
“Proceeding”
shall have the meaning ascribed to such term in Section 3(b).
“Prospectus”
shall mean the Base Prospectus, as supplemented by the most recently filed Prospectus Supplement (if any).
“Prospectus
Supplement” shall mean each prospectus supplement relating to the Shares prepared and filed pursuant to Rule 424(b) from
time to time.
“Registration
Statement” shall mean the shelf registration statement (File Number 333-279252) on Form S-3, including exhibits and
financial statements, the Base Prospectus and any prospectus supplement relating to the Shares that is filed with the Commission pursuant
to Rule 424(b) and deemed part of such registration statement pursuant to Rule 430B, as amended on each Effective Date and,
in the event any post-effective amendment thereto becomes effective, shall also mean such registration statement as so amended. Any reference
herein to the Registration Statement, the Base Prospectus, the Prospectus Supplement, the Prospectus or any amendment or supplement thereto
shall be deemed to refer to and include the Incorporated Documents.
“Representation
Date” shall have the meaning ascribed to such term in Section 4(k).
“Required
Approvals” shall have the meaning ascribed to such term in Section 3(e).
“Rule 158”,
“Rule 164”, “Rule 172”, “Rule 173”, “Rule 405”,
“Rule 415”, “Rule 424”, “Rule 430B” and “Rule 433”
refer to such rules under the Act.
“Sales
Notice” shall have the meaning ascribed to such term in Section 2(b)(i).
“SEC Reports”
shall have the meaning ascribed to such term in Section 3(m).
“Settlement
Date” shall have the meaning ascribed to such term in Section 2(b)(vii).
“Subsidiary”
shall have the meaning ascribed to such term in Section 3(a).
“Terms
Agreement” shall have the meaning ascribed to such term in Section 2(a).
“Time of
Delivery” shall have the meaning ascribed to such term in Section 2(c).
“Trading
Day” means a day on which the Trading Market is open for trading.
“Trading
Market” means the Nasdaq Capital Market.
2. Sale
and Delivery of Shares. The Company proposes to issue and sell through or to the Manager, as sales agent and/or principal, from time
to time during the term of this Agreement and on the terms set forth herein, up to such number of shares (the “Shares”)
of the Company’s common stock, $0.001 par value per share (“Common Stock”), that does not exceed (a) the
number or dollar amount of shares of Common Stock registered on the Prospectus Supplement, pursuant to which the offering is being made,
(b) the number of authorized but unissued shares of Common Stock (less the number of shares of Common Stock issuable upon exercise, conversion
or exchange of any outstanding securities of the Company or otherwise reserved from the Company’s authorized capital stock), or
(c) the number or dollar amount of shares of Common Stock that would cause the Company or the offering of the Shares to not satisfy the
eligibility and transaction requirements for use of Form S-3, including, if applicable, General Instruction I.B.6 of Registration Statement
on Form S-3 (the lesser of (a), (b) and (c), the “Maximum Amount”). Notwithstanding anything to the contrary contained
herein, the parties hereto agree that compliance with the limitations set forth in this Section 2 on the number and aggregate sales price
of Shares issued and sold under this Agreement shall be the sole responsibility of the Company and that the Manager shall have no obligation
in connection with such compliance.
(a) Appointment
of Manager as Selling Agent; Terms Agreement. For purposes of selling the Shares through the Manager, the Company hereby appoints
the Manager as exclusive agent of the Company for the purpose of selling the Shares of the Company pursuant to this Agreement and the
Manager agrees to use its commercially reasonable efforts to sell the Shares on the terms and subject to the conditions stated herein.
The Company agrees that, whenever it determines to sell the Shares directly to the Manager as principal, it will enter into a separate
agreement (each, a “Terms Agreement”) in substantially the form of Annex I hereto, relating to such sale in
accordance with Section 2 of this Agreement.
(b) Agent
Sales. Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Company will
issue and agrees to sell Shares from time to time through the Manager, acting as sales agent, and the Manager agrees to use its commercially
reasonable efforts to sell, as sales agent for the Company, on the following terms:
(i) The
Shares are to be sold on a daily basis or otherwise as shall be agreed to by the Company and the Manager on any day that (A) is a
Trading Day, (B) the Company has instructed the Manager by telephone (confirmed promptly by electronic mail) to make such sales (“Sales
Notice”) and (C) the Company has satisfied its obligations under Section 6 of this Agreement. Pursuant to such Sales Notice,
the Company will designate the maximum amount of the Shares to be sold by the Manager daily (subject to the limitations set forth in Section
2(d)) and the minimum price per Share at which such Shares may be sold. Subject to the terms and conditions hereof, the Manager shall
use its commercially reasonable efforts to sell on a particular day all of the Shares designated for sale by the Company on such day.
The gross sales price of the Shares sold under this Section 2(b) shall be the market price for the shares of Common Stock sold by
the Manager under this Section 2(b) on the Trading Market at the time of sale of such Shares.
(ii) The
Company acknowledges and agrees that (A) there can be no assurance that the Manager will be successful in selling the Shares, (B) the
Manager will incur no liability or obligation to the Company or any other person or entity if it does not sell the Shares for any reason
other than a failure by the Manager to use its commercially reasonable efforts consistent with its normal trading and sales practices
and applicable law and regulations to sell such Shares as required under this Agreement, and (C) the Manager shall be under no obligation
to purchase Shares on a principal basis pursuant to this Agreement, except as otherwise specifically agreed by the Manager and the Company
pursuant to a Terms Agreement.
(iii) The
Company shall not authorize the issuance and sale of, and the Manager shall not be obligated to use its commercially reasonable efforts
to sell, any Share at a price lower than the minimum price therefor designated from time to time by the Company’s Board of Directors
(the “Board”), or a duly authorized committee thereof, or such duly authorized officers of the Company, and notified
to the Manager in writing. The Company or the Manager may, upon notice to the other party hereto by telephone (confirmed promptly by electronic
mail), suspend the offering of the Shares for any reason and at any time; provided, however, that such suspension or termination
shall not affect or impair the parties’ respective obligations with respect to the Shares sold hereunder prior to the giving of
such notice.
(iv) The
Manager may sell Shares by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415
under the Act, including without limitation sales made directly on the Trading Market, on any other existing trading market for the Common
Stock or to or through a market maker. The Manager may also sell Shares in privately negotiated transactions, provided that the Manager
receives the Company’s prior written approval for any sales in privately negotiated transactions and if so provided in the “Plan
of Distribution” section of the Prospectus Supplement or a supplement to the Prospectus Supplement or a new Prospectus Supplement
disclosing the terms of such privately negotiated transaction.
(v) The
compensation to the Manager for sales of the Shares under this Section 2(b) shall be a placement fee of 3.0% of the gross sales price
of the Shares sold pursuant to this Section 2(b) (“Broker Fee”). The foregoing rate of compensation shall not apply
when the Manager acts as principal, in which case the Company may sell Shares to the Manager as principal at a price agreed upon at the
relevant Applicable Time pursuant to a Terms Agreement. The remaining proceeds, after deduction of the Broker Fee and deduction of any
transaction fees imposed by any clearing firm, execution broker, or governmental or self-regulatory organization in respect of such sales,
shall constitute the net proceeds to the Company for such Shares (the “Net Proceeds”).
(vi) The
Manager shall provide written confirmation (which may be by facsimile or electronic mail) to the Company following the close of trading
on the Trading Market each day in which the Shares are sold under this Section 2(b) setting forth the number of the Shares sold on such
day, the aggregate gross sales proceeds and the Net Proceeds to the Company, and the compensation payable by the Company to the Manager
with respect to such sales.
(vii) Unless
otherwise agreed between the Company and the Manager in writing, settlement for sales of the Shares will occur at 10:00 a.m. (New York
City time) on the second (2nd) Trading Day (and on and after May 28, 2024 or such later date on which the Commission’s final rule
with respect to the shortening of the securities transaction settlement cycle becomes effective), on the first (1st) Trading Day, or
any such shorter settlement cycle as may be in effect under Exchange Act Rule 15c6-1 from time to time) following the date on which
such sales are made (each, a “Settlement Date”). On or before the Trading Day prior to each Settlement Date, the Company
will, or will cause its transfer agent to, electronically transfer the Shares being sold by crediting the Manager’s or its designee’s
account (provided that the Manager shall have given the Company written notice of such designee at least one Trading Day prior to the
Settlement Date) at The Depository Trust Company (“DTC”) through its Deposit and Withdrawal at Custodian System or
by such other means of delivery as may be mutually agreed upon by the parties hereto, which Shares in all cases shall be freely tradable,
transferable, registered shares in good deliverable form. On each Settlement Date, the Manager will deliver the related Net Proceeds in
same day funds to an account designated by the Company. The Company agrees that, if the Company, or its transfer agent (if applicable),
defaults in its obligation to deliver duly authorized Shares on a Settlement Date, in addition to and in no way limiting the rights and
obligations set forth in Section 7 hereto, the Company will (i) hold the Manager harmless against any loss, claim, damage, or reasonable,
documented expense (including reasonable and documented legal fees and expenses), as incurred, arising out of or in connection with such
default by the Company, and (ii) pay to the Manager any commission, discount or other compensation to which the Manager would otherwise
have been entitled absent such default.
(viii) At
each Applicable Time, Settlement Date and Representation Date, the Company shall be deemed to have affirmed each representation and warranty
contained in this Agreement as if such representation and warranty were made as of such date, modified as necessary to relate to the Registration
Statement and the Prospectus as amended as of such date. Any obligation of the Manager to use its commercially reasonable efforts to sell
the Shares on behalf of the Company shall be subject to the continuing accuracy of the representations and warranties of the Company herein,
to the performance by the Company of its obligations hereunder and to the continuing satisfaction of the additional conditions specified
in Section 6 of this Agreement.
(ix) If
the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares
of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities,
property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar
transaction) (a “Distribution” and the record date for the determination of stockholders entitled to receive the Distribution,
the “Record Date”), the Company hereby covenants that, in connection with any sales of Shares pursuant to a Sales Notice
on the Record Date, the Company shall issue and deliver such Shares to the Manager on the Record Date and the Record Date shall be the
Settlement Date and the Company shall cover any additional costs of the Manager in connection with the delivery of Shares on the Record
Date.
(c) Term
Sales. If the Company wishes to sell the Shares pursuant to this Agreement in a manner other than as set forth in Section 2(b) of
this Agreement (each, a “Placement”), the Company will notify the Manager of the proposed terms of such Placement.
If the Manager, acting as principal, wishes to accept such proposed terms (which it may decline to do for any reason in its sole discretion)
or, following discussions with the Company wishes to accept amended terms, the Manager and the Company will enter into a Terms Agreement
setting forth the terms of such Placement. The terms set forth in a Terms Agreement will not be binding on the Company or the Manager
unless and until the Company and the Manager have each executed such Terms Agreement accepting all of the terms of such Terms Agreement.
In the event of a conflict between the terms of this Agreement and the terms of a Terms Agreement, the terms of such Terms Agreement will
control. A Terms Agreement may also specify certain provisions relating to the reoffering of such Shares by the Manager. The commitment
of the Manager to purchase the Shares pursuant to any Terms Agreement shall be deemed to have been made on the basis of the representations
and warranties of the Company herein contained and shall be subject to the terms and conditions herein set forth. Each Terms Agreement
shall specify the number of the Shares to be purchased by the Manager pursuant thereto, the price to be paid to the Company for such Shares,
any provisions relating to rights of, and default by, underwriters acting together with the Manager in the reoffering of the Shares, and
the time and date (each such time and date being referred to herein as a “Time of Delivery”) and place of delivery
of and payment for such Shares. Such Terms Agreement shall also specify any requirements for opinions of counsel, accountants’ letters
and officers’ certificates pursuant to Section 6 of this Agreement and any other information or documents required by the Manager.
(d) Maximum
Number of Shares. Under no circumstances shall the Company cause or request the offer or sale of any Shares if, after giving effect
to the sale of such Shares, the aggregate amount of Shares sold pursuant to this Agreement would exceed the lesser of (A) together with
all sales of Shares under this Agreement, the Maximum Amount, (B) the amount available for offer and sale under the currently effective
Registration Statement and (C) the amount authorized from time to time to be issued and sold under this Agreement by the Board, a duly
authorized committee thereof or a duly authorized executive committee, and notified to the Manager in writing. Under no circumstances
shall the Company cause or request the offer or sale of any Shares pursuant to this Agreement at a price lower than the minimum price
authorized from time to time by the Board, a duly authorized committee thereof or a duly authorized executive officer, and notified to
the Manager in writing. Further, under no circumstances shall the Company cause or permit the aggregate offering amount of Shares sold
pursuant to this Agreement to exceed the Maximum Amount.
(e) Regulation
M Notice. Unless the exceptive provisions set forth in Rule 101(c)(1) of Regulation M under the Exchange Act are satisfied
with respect to the Shares, the Company shall give the Manager at least one (1) Business Day’s prior notice of its intent to sell
any Shares in order to allow the Manager time to comply with Regulation M.
3. Representations
and Warranties. The Company represents and warrants to, and agrees with, the Manager at the Execution Time and on each such time that
the following representations and warranties are repeated or deemed to be made pursuant to this Agreement as set forth below, except as
set forth in the Registration Statement, the Prospectus or the Incorporated Documents:
(a) Subsidiaries.
All of the direct and indirect subsidiaries (individually, a “Subsidiary”) of the Company are set forth on Exhibit
21.1 to the Company’s most recent Annual Report on Form 10-K filed with the Commission. The Company owns, directly or indirectly,
all of the capital stock or other equity interests of each Subsidiary free and clear of any “Liens” (which for purposes
of this Agreement shall mean a lien, charge, security interest, encumbrance, right of first refusal, preemptive right or other restriction),
and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable
and free of preemptive and similar rights to subscribe for or purchase securities.
(b) Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to
own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in
violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational
or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected
to result in: (i) a material adverse effect on the legality, validity or enforceability of this Agreement, (ii) a material adverse effect
on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken
as a whole, from that set forth in the Registration Statement, the Base Prospectus, any Prospectus Supplement, the Prospectus or the Incorporated
Documents, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its
obligations under this Agreement (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no “Proceeding”
(which for purposes of this Agreement shall mean any action, claim, suit, investigation or proceeding (including, without limitation,
an informal investigation or partial proceeding, such as a deposition), whether commenced or, to the Company’s knowledge, threatened)
has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority
or qualification.
(c) Authorization
and Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by this Agreement and otherwise to carry out its obligations hereunder. The execution and delivery of this Agreement by the Company and
the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Company
and no further action is required by the Company, the Board or the Company’s stockholders in connection herewith other than in connection
with the Required Approvals. This Agreement has been duly executed and delivered by the Company and, when delivered in accordance with
the terms hereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its
terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other
laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions
may be limited by applicable law.
(d) No
Conflicts. The execution, delivery and performance by the Company of this Agreement, the issuance and sale of the Shares and the consummation
by it of the transactions contemplated hereby do not and will not (i) conflict with or violate any provision of the Company’s or
any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict
with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation
of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment,
anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement,
credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company
or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject
to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state
securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the
case of each of clauses (ii) and (iii), such as could not, individually or in the aggregate, have or reasonably be expected to result
in a Material Adverse Effect.
(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to,
or make any filing or registration with, any court or other federal, state, local or other governmental authority or other “Person”
(defined as an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind, including the Trading Market)
in connection with the execution, delivery and performance by the Company of this Agreement, other than (i) the filings required by this
Agreement, (ii) the filing with the Commission of the Prospectus Supplement, (iii) the filing of application(s) to and approval by the
Trading Market for the listing of the Shares for trading thereon in the time and manner required thereby, and (iv) such filings as are
required to be made under applicable state securities laws and the rules and regulations of the Financial Industry Regulatory Authority,
Inc. (“FINRA”) (collectively, the “Required Approvals”).
(f) Issuance
of Shares. The Shares are duly authorized and, when issued and paid for in accordance with this Agreement, will be duly and validly
issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized
capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement. The issuance by the Company of the Shares
has been registered under the Act and all of the Shares are freely transferable and tradable by the purchasers thereof without restriction
(other than any restrictions arising solely from an act or omission of such a purchaser). The Shares are being issued pursuant to the
Registration Statement and the issuance of the Shares has been registered by the Company under the Act. The “Plan of Distribution”
section within the Registration Statement permits the issuance and sale of the Shares as contemplated by this Agreement. Upon receipt
of the Shares, the purchasers of such Shares will have good and marketable title to such Shares and the Shares will be freely tradable
on the Trading Market.
(g) Capitalization.
The capitalization of the Company is as set forth in the SEC Reports. The Company has not issued any capital stock since its most recently
filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options under the Company’s
stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee stock purchase plan and
pursuant to the conversion and/or exercise of securities exercisable, exchangeable or convertible into Common Stock (“Common
Stock Equivalents”) outstanding as of the date of the most recently filed periodic report under the Exchange Act. No Person
has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated
by this Agreement. Except as set forth in the SEC Reports, there are no outstanding options, warrants, scrip rights to subscribe to, calls
or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable
for, or giving any Person any right to subscribe for or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or
contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional
shares of Common Stock or Common Stock Equivalents or capital stock of any Subsidiary. The issuance and sale of the Shares will not obligate
the Company or any Subsidiary to issue shares of Common Stock or other securities to any Person. There are no outstanding securities or
instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such
security or instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments
of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary.
The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement.
All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any
preemptive rights or similar rights to subscribe for or purchase securities. No further approval or authorization of any stockholder,
the Board or others is required for the issuance and sale of the Shares. There are no stockholders agreements, voting agreements or other
similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company,
between or among any of the Company’s stockholders.
(h) Registration
Statement. The Company meets the requirements for use of Form S-3 under the Act and has prepared and filed with the Commission
the Registration Statement, including a related Base Prospectus, for registration under the Act of the offering and sale of the Shares.
Such Registration Statement is effective and available for the offer and sale of the Shares as of the date hereof. As filed, the Base
Prospectus contains all information required by the Act and the rules thereunder, and, except to the extent the Manager shall agree in
writing to a modification, shall be in all substantive respects in the form furnished to the Manager prior to the Execution Time or prior
to any such time this representation is repeated or deemed to be made. The Registration Statement, at the Execution Time, each such time
this representation is repeated or deemed to be made, and at all times during which a prospectus is required by the Act to be delivered
(whether physically or through compliance with Rule 172, 173 or any similar rule) in connection with any offer or sale of the Shares,
meets the requirements set forth in Rule 415(a)(1)(x). The initial Effective Date of the Registration Statement was not earlier than
the date three years before the Execution Time. The Company meets the transaction requirements as set forth in General Instruction I.B.1
of Form S-3 or, if applicable, as set forth in General Instruction I.B.6 of Form S-3 with respect to the aggregate market value of securities
being sold pursuant to this offering and during the twelve (12) months prior to this offering.
(i) Accuracy
of Incorporated Documents. The Incorporated Documents, when they were filed with the Commission, conformed in all material respects
to the requirements of the Exchange Act and the rules thereunder, and none of the Incorporated Documents, when they were filed with the
Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made not misleading; and any further documents so filed and incorporated by reference
in the Registration Statement, the Base Prospectus, the Prospectus Supplement or the Prospectus, when such documents are filed with the
Commission, will conform in all material respects to the requirements of the Exchange Act and the rules thereunder, as applicable, and
will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(j) Ineligible
Issuer. (i) At the earliest time after the filing of the Registration Statement that the Company or another offering participant
made a bona fide offer (within the meaning of Rule 164(h)(2)) of the Shares and (ii) as of the Execution Time and on each such
time this representation is repeated or deemed to be made (with such date being used as the determination date for purposes of this clause (ii)),
the Company was not and is not an Ineligible Issuer (as defined in Rule 405), without taking account of any determination by the
Commission pursuant to Rule 405 that it is not necessary that the Company be considered an Ineligible Issuer.
(k) Free
Writing Prospectus. The Company is eligible to use Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus does not
include any information the substance of which conflicts with the information contained in the Registration Statement, including any Incorporated
Documents and any prospectus supplement deemed to be a part thereof that has not been superseded or modified; and each Issuer Free Writing
Prospectus does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading. The foregoing sentence does not apply
to statements in or omissions from any Issuer Free Writing Prospectus based upon and in conformity with written information furnished
to the Company by the Manager specifically for use therein. Any Issuer Free Writing Prospectus that the Company is required to file pursuant
to Rule 433(d) has been, or will be, filed with the Commission in accordance with the requirements of the Act and the rules thereunder.
Each Issuer Free Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) or that was prepared by
or behalf of or used by the Company complies or will comply in all material respects with the requirements of the Act and the rules thereunder.
The Company will not, without the prior consent of the Manager, prepare, use or refer to, any Issuer Free Writing Prospectuses.
(l) Proceedings
Related to Registration Statement. The Registration Statement is not the subject of a pending proceeding or examination under Section 8(d)
or 8(e) of the Act, and the Company is not the subject of a pending proceeding under Section 8A of the Act in connection with the
offering of the Shares. The Company has not received any notice that the Commission has issued or intends to issue a stop-order with respect
to the Registration Statement or that the Commission otherwise has suspended or withdrawn the effectiveness of the Registration Statement,
either temporarily or permanently, or intends or has threatened in writing to do so.
(m) SEC
Reports. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under
the Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such
shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits
thereto and documents incorporated by reference therein, together with the Prospectus and the Prospectus Supplement, being collectively
referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing
and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied
in all material respects with the requirements of the Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order
to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements
of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance
with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and
its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.
(n) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares from the Manager
pursuant to this Agreement, will not be or be an Affiliate of, an “investment company” within the meaning of the Investment
Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an “investment company”
subject to registration under the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so as
to reasonably ensure that it or its Subsidiaries will not become an “investment company” subject to registration under the
Investment Company Act of 1940, as amended.
(o) Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included within
the SEC Reports, except as specifically disclosed in a subsequent SEC Report filed prior to the date hereof, (i) there has been no event,
occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has
not incurred any material liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary
course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements
pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the
Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or
made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to
any officer, director or “Affiliate” (defined as any Person that, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 144 under the
Act), except pursuant to existing Company stock option plans, and (vi) no executive officer of the Company or member of the Board has
resigned from any position with the Company. The Company does not have pending before the Commission any request for confidential treatment
of information. Except for the issuance of the Shares contemplated by this Agreement, no event, liability, fact, circumstance, occurrence
or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their
respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the
Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at
least one (1) Trading Day prior to the date that this representation is made.
(p) Litigation.
Except as set forth in the SEC Reports, there is no action, suit, inquiry, notice of violation, proceeding or investigation pending or,
to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before
or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign)
(collectively, an “Action”). None of the Actions set forth in the SEC Reports, (i) adversely affects or challenges
the legality, validity or enforceability of this Agreement or the Shares or (ii) could, if there were an unfavorable decision, have or
reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof,
is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim
of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation
by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any
stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the
Exchange Act or the Act.
(q) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company,
which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees
is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company
nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships
with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected
to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement
or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued
employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any
of the foregoing matters. The Company and its Subsidiaries are in compliance with all applicable U.S. federal, state, local and foreign
laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where
the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(r) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or
any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement
or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default
or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority
or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality
and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse
Effect.
(s) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution
or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata),
including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as
all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have received
all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and
(iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and (iii),
the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
(t) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except
where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification
of any Material Permit.
(u) Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good
and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each
case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal,
state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of which is neither
delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by
them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance, except where failure
to be in compliance could not reasonably be expected to have a Material Adverse Effect.
(v) Intellectual
Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights
necessary or required for use in connection with their respective businesses as described in the SEC Reports and which the failure to
so have could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None of, and neither
the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired,
terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement.
Neither the Company nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC
Reports, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the
rights of any Person, except as could not have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the
Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual
Property Rights. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and
value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(w) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited
to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant increase in cost.
(x) Affiliate
Transactions. Except as set forth in the SEC Reports, none of the officers or directors of the Company or any Subsidiary and, to the
knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company
or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement
providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing
of money from or lending of money to or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge
of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director,
trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for
services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock
option agreements under any stock option plan of the Company.
(y) Sarbanes
Oxley Compliance. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the Sarbanes-Oxley
Act of 2002, as amended, that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the
Commission thereunder that are effective as of the date hereof. The Company and the Subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general
or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with
GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific
authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls
and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange
Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. The
Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and the
Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date, the “Evaluation
Date”). The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying
officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since
the Evaluation Date, there have been no changes in the internal control over financial reporting (as such term is defined in the Exchange
Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely to materially affect, the internal control
over financial reporting of the Company and its Subsidiaries.
(z) Certain
Fees. Other than payments to be made to the Manager, no brokerage or finder’s fees or commissions are or will be payable by
the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other
Person with respect to the transactions contemplated by this Agreement. The Manager shall have no obligation with respect to any fees
or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in
connection with the transactions contemplated by this Agreement.
(aa) No Other
Sales Agency Agreement. The Company has not entered into any other sales agency agreements or other similar arrangements with any
agent or any other representative in respect of at the market offerings of the Shares.
(bb) Listing
and Maintenance Requirements. The Common Stock is listed on the Trading Market and the issuance of the Shares as contemplated by this
Agreement does not contravene the rules and regulations of the Trading Market. The Common Stock is registered pursuant to Section 12(b)
or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect
of, terminating the registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission
is contemplating terminating such registration. Except as disclosed in the Registration Statement, the Base Prospectus, any Prospectus
Supplement or the Prospectus, the Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market
on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance
requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue
to be, in compliance with all such listing and maintenance requirements. The Common Stock is currently eligible for electronic transfer
through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the fees to
the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.
(cc) Application
of Takeover Protections. The Company and the Board have taken all necessary action, if any, in order to render inapplicable any control
share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover
provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of its state of incorporation
that is or could become applicable to the Shares.
(dd) Solvency.
Based on the consolidated financial condition of the Company as of the date hereof, (i) the fair saleable value of the Company’s
assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all
of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of
its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts
as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge
of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization
laws of any jurisdiction within one year from the date hereof. The SEC Reports set forth as of the date hereof all outstanding secured
and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. For the purposes
of this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in excess of $50,000
(other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other contingent
obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s consolidated
balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases
required to be capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.
(ee) Tax Status.
Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect,
the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and
franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other
governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations
and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.
(ff) Foreign
Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other
person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign
or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii)
failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the
Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt Practices
Act of 1977, as amended.
(gg) Accountants.
The Company’s accounting firm is set forth in the SEC Reports. To the knowledge and belief of the Company, such accounting firm
(i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial
statements to be included in the Company’s Annual Report for the fiscal year ending December 31, 2023.
(hh) Regulation
M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly,
any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of any of the Shares, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of
the Shares, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the
Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Manager in connection with the Shares.
(ii) Reserved.
(jj) Stock
Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance with
the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value of the Common
Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the Company’s
stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company policy or practice
to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the release or other public
announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects.
(kk) Cybersecurity.
(i)(x) There has been no security breach or other compromise of or relating to any of the Company’s or any Subsidiary’s information
technology and computer systems, networks, hardware, software, data (including the data of its respective customers, employees, suppliers,
vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively, “IT Systems and Data”)
and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of any event or condition that would reasonably
be expected to result in, any security breach or other compromise to its IT Systems and Data; (ii) the Company and the Subsidiaries are
presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator
or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems
and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as
would not, individually or in the aggregate, have a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented
and maintained commercially reasonable safeguards to maintain and protect its material confidential information and the integrity, continuous
operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented backup and disaster
recovery technology consistent with industry standards and practices.
(ll) Compliance
with Data Privacy Laws. (i) The Company and the Subsidiaries are, and at all times during the past three years were, in compliance
with all applicable data privacy and security laws and regulations, including, as applicable, the European Union General Data Protection
Regulation (“GDPR”) (EU 2016/679) (collectively, “Privacy Laws”); (ii) the Company and the
Subsidiaries have in place, comply with, and take appropriate steps reasonably designed to ensure compliance with their policies and procedures
relating to data privacy and security and the collection, storage, use, disclosure, handling and analysis of Personal Data (the “Policies”);
(iii) the Company provides accurate notice of its applicable Policies to its customers, employees, third party vendors and representatives
as required by Privacy Laws; and (iv) applicable Policies provide accurate and sufficient notice of the Company’s then-current
privacy practices relating to its subject matter, and do not contain any material omissions of the Company’s then-current privacy
practices, as required by Privacy Laws. “Personal Data” means (i) a natural person’s name, street address,
telephone number, email address, photograph, social security number, bank information, or customer or account number; (ii) any information
which would qualify as “personally identifying information” under the Federal Trade Commission Act, as amended; (iii) “personal
data” as defined by GDPR; and (iv) any other piece of information that allows the identification of such natural person, or
his or her family, or permits the collection or analysis of any identifiable data related to an identified person’s health or sexual
orientation. (i) None of such disclosures made or contained in any of the Policies have been inaccurate, misleading, or deceptive
in violation of any Privacy Laws and (ii) the execution, delivery and performance of this Agreement will not result in a breach of
any Privacy Laws or Policies. Neither the Company nor the Subsidiaries, (i) has, to the knowledge of the Company, received
written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation by the
Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part, any investigation,
remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or (iii) is a party
to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that imposed any obligation
or liability under any Privacy Law.
(mm) Office
of Foreign Assets Control. Neither the Company nor any of its Subsidiaries, nor to the knowledge of the Company, any of the directors,
officers or employees of the Company or its Subsidiaries, is an individual or entity that is, or is owned or controlled by an individual
or entity that is: (i) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of
Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions
authority (collectively, “Sanctions”), nor (ii) located, organized or resident in a country or territory that
is the subject of Sanctions. Neither the Company nor any of its Subsidiaries will, directly or indirectly, use the proceeds of the transactions
contemplated hereby, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other individual
or entity: (i) to fund or facilitate any activities or business of or with any individual or entity or in any country or territory
that, at the time of such funding or facilitation, is the subject of Sanctions or (ii) in any other manner that will result in a
violation of Sanctions by any individual or entity (including any individual or entity participating in the transactions contemplated
hereby, whether as underwriter, advisor, investor or otherwise). For the past five years, neither the Company nor any of its Subsidiaries
has knowingly engaged in, and is not now knowingly engaged in, any dealings or transactions with any individual or entity, or in any country
or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.
(nn) U.S.
Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning
of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Manager’s request.
(oo) Bank
Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956,
as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal
Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent
(5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a
bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries
or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and
to regulation by the Federal Reserve.
(pp) Money
Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable
financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable
money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or
any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
(qq) FINRA
Member Shareholders. There are no affiliations with any FINRA member firm among the Company’s officers, directors or, to the
knowledge of the Company, any five percent (5%) or greater stockholder of the Company, except as set forth in the Registration Statement,
the Base Prospectus, any Prospectus Supplement or the Prospectus.
4. Agreements.
The Company agrees with the Manager that:
(a) Right
to Review Amendments and Supplements to Registration Statement and Prospectus. During any period when the delivery of a prospectus
relating to the Shares is required (including in circumstances where such requirement may be satisfied pursuant to Rule 172, 173
or any similar rule) to be delivered under the Act in connection with the offering or the sale of Shares, the Company will not file any
amendment to the Registration Statement or supplement (including any Prospectus Supplement) to the Base Prospectus unless the Company
has furnished to the Manager a copy for its review prior to filing and will not file any such proposed amendment or supplement to which
the Manager reasonably objects. The Company has properly completed the Prospectus, in a form approved by the Manager, and filed such Prospectus,
as amended at the Execution Time, with the Commission pursuant to the applicable paragraph of Rule 424(b) by the Execution Time and
will cause any supplement to the Prospectus to be properly completed, in a form approved by the Manager, and will file such supplement
with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed thereby and will provide
evidence reasonably satisfactory to the Manager of such timely filing. The Company will promptly advise the Manager (i) when the
Prospectus, and any supplement thereto, shall have been filed (if required) with the Commission pursuant to Rule 424(b), (ii) when,
during any period when the delivery of a prospectus (whether physically or through compliance with Rule 172, 173 or any similar rule)
is required under the Act in connection with the offering or sale of the Shares, any amendment to the Registration Statement shall have
been filed or become effective (other than any annual report of the Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act),
(iii) of any request by the Commission or its staff for any amendment of the Registration Statement, or for any supplement to the
Prospectus or for any additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or of any notice objecting to its use or the institution or threatening of any proceeding for that purpose
and (v) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Shares for sale
in any jurisdiction or the institution or threatening of any proceeding for such purpose. The Company will use its best efforts to prevent
the issuance of any such stop order or the occurrence of any such suspension or objection to the use of the Registration Statement and,
upon such issuance, occurrence or notice of objection, to obtain as soon as possible the withdrawal of such stop order or relief from
such occurrence or objection, including, if necessary, by filing an amendment to the Registration Statement or a new registration statement
and using its best efforts to have such amendment or new registration statement declared effective as soon as practicable.
(b) Subsequent
Events. If, at any time on or after an Applicable Time but prior to the related Settlement Date, any event occurs as a result of which
the Registration Statement or Prospectus would include any untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under which they were made or the circumstances then prevailing not misleading,
the Company will (i) notify promptly the Manager so that any use of the Registration Statement or Prospectus may cease until such
are amended or supplemented; (ii) amend or supplement the Registration Statement or Prospectus to correct such statement or omission;
and (iii) supply any such amendment or supplement to the Manager in such quantities as the Manager may reasonably request.
(c) Notification
of Subsequent Filings. During any period when the delivery of a prospectus relating to the Shares is required (including in circumstances
where such requirement may be satisfied pursuant to Rule 172, 173 or any similar rule) to be delivered under the Act, any event occurs
as a result of which the Prospectus as then supplemented would include any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the circumstances under which they were made not misleading, or if it shall
be necessary to amend the Registration Statement, file a new registration statement or supplement the Prospectus to comply with the Act
or the Exchange Act or the respective rules thereunder, including in connection with use or delivery of the Prospectus, the Company promptly
will (i) notify the Manager of any such event, (ii) subject to Section 4(a), prepare and file with the Commission an amendment
or supplement or new registration statement which will correct such statement or omission or effect such compliance, (iii) use its
best efforts to have any amendment to the Registration Statement or new registration statement declared effective as soon as practicable
in order to avoid any disruption in use of the Prospectus and (iv) supply any supplemented Prospectus to the Manager in such quantities
as the Manager may reasonably request.
(d) Earnings
Statements. As soon as practicable, the Company will make generally available to its security holders and to the Manager an earnings
statement or statements of the Company and its Subsidiaries which will satisfy the provisions of Section 11(a) of the Act and Rule 158.
For the avoidance of doubt, the Company’s compliance with the reporting requirements of the Exchange Act shall be deemed to satisfy
the requirements of this Section 4(d).
(e) Delivery
of Registration Statement. Upon the request of the Manager, the Company will furnish to the Manager and counsel for the Manager, without
charge, signed copies of the Registration Statement (including exhibits thereto) and, so long as delivery of a prospectus by the Manager
or dealer may be required by the Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172, 173
or any similar rule), as many copies of the Prospectus and each Issuer Free Writing Prospectus and any supplement thereto as the Manager
may reasonably request. The Company will pay the expenses of printing or other production of all documents relating to the offering.
(f) Qualification
of Shares. The Company will arrange, if necessary, for the qualification of the Shares for sale under the laws of such jurisdictions
as the Manager may designate and will maintain such qualifications in effect so long as required for the distribution of the Shares; provided
that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take
any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the Shares, in
any jurisdiction where it is not now so subject.
(g) Free
Writing Prospectus. The Company agrees that, unless it has or shall have obtained the prior written consent of the Manager, and the
Manager agrees with the Company that, unless it has or shall have obtained, as the case may be, the prior written consent of the Company,
it has not made and will not make any offer relating to the Shares that would constitute an Issuer Free Writing Prospectus or that would
otherwise constitute a “free writing prospectus” (as defined in Rule 405) required to be filed by the Company with the
Commission or retained by the Company under Rule 433. Any such free writing prospectus consented to by the Manager or the Company
is hereinafter referred to as a “Permitted Free Writing Prospectus.” The Company agrees that (i) it has treated
and will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (ii) it has complied
and will comply, as the case may be, with the requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus,
including in respect of timely filing with the Commission, legending and record keeping.
(h) Subsequent
Equity Issuances. The Company shall not deliver any Sales Notice hereunder (and any Sales Notice previously delivered shall not apply
during such two (2) Trading Days) for at least two (2) Trading Days prior to any date on which the Company or any Subsidiary offers, sells,
issues, contracts to sell, contracts to issue or otherwise disposes of, directly or indirectly, any other shares of Common Stock or any
Common Stock Equivalents (other than the Shares), subject to Manager’s right to waive this obligation, provided that, without compliance
with the foregoing obligation, the Company may (i) issue and sell Common Stock pursuant to any employee equity plan, stock ownership plan
or dividend reinvestment plan of the Company in effect at the Execution Time, (ii) issue Common Stock issuable upon the conversion or
exercise of Common Stock Equivalents outstanding at the Execution Time, (iii) issue Common Stock or securities convertible into or exercisable
for Common Stock that are offered and sold in privately negotiated transactions to vendors, customers, strategic partners or potential
strategic partners or other investors conducted in a manner so as not to be integrated with the offering of Common Stock hereby and (iv)
issue Common Stock in connection with any acquisition, strategic investment or other similar transaction (including any joint venture,
strategic alliance or partnership).
(i) Market
Manipulation. Until the termination of this Agreement, the Company will not take, directly or indirectly, any action designed to or
that would constitute or that might reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization or
manipulation in violation of the Act, Exchange Act or the rules and regulations thereunder of the price of any security of the Company
to facilitate the sale or resale of the Shares or otherwise violate any provision of Regulation M under the Exchange Act.
(j) Notification
of Incorrect Certificate. The Company will, at any time during the term of this Agreement, as supplemented from time to time, advise
the Manager immediately after it shall have received notice or obtained knowledge thereof, of any information or fact that would alter
or affect any opinion, certificate, letter and other document provided to the Manager pursuant to Section 6 herein.
(k) Certification
of Accuracy of Disclosure. Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the
offering of the Shares under this Agreement following the termination of a suspension of sales hereunder lasting more than thirty (30)
Trading Days), and each time that (i) the Registration Statement or Prospectus shall be amended or supplemented, other than by means of
Incorporated Documents, (ii) the Company files its Annual Report on Form 10-K under the Exchange Act, (iii) the Company files its quarterly
reports on Form 10-Q under the Exchange Act, (iv) the Company files a Current Report on Form 8-K containing amended financial information
(other than information that is furnished and not filed), if the Manager reasonably determines that the information in such Form 8-K is
material, or (v) the Shares are delivered to the Manager as principal at the Time of Delivery pursuant to a Terms Agreement (such commencement
or recommencement date and each such date referred to in (i), (ii), (iii), (iv) and (v) above, a “Representation Date”),
unless waived by the Manager, the Company shall furnish or cause to be furnished to the Manager forthwith a certificate dated and delivered
on the Representation Date, in form reasonably satisfactory to the Manager to the effect that the statements contained in the certificate
referred to in Section 6 of this Agreement which were last furnished to the Manager are true and correct at the Representation Date, as
though made at and as of such date (except that such statements shall be deemed to relate to the Registration Statement and the Prospectus
as amended and supplemented to such date) or, in lieu of such certificate, a certificate of the same tenor as the certificate referred
to in said Section 6, modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to
the date of delivery of such certificate.
(l) Bring
Down Opinions; Negative Assurance. At each Representation Date, unless waived by the Manager, the Company shall furnish or cause to
be furnished forthwith to the Manager and to counsel to the Manager a written opinion of counsel to the Company (“Company Counsel”)
addressed to the Manager and dated and delivered on such Representation Date, in form and substance reasonably satisfactory to the Manager,
including a negative assurance representation; provided, however,
that if the Company Counsel has previously furnished to the Manager such written opinion and negative assurance of such counsel substantially
in the form previously agreed between the Company and the Manager, then the Company Counsel may, in respect of any future Representation
Date, furnish the Manager with a letter signed by such counsel (each, a “Reliance Letter”) in lieu of such opinion
and negative assurance of such counsel to the effect that the Manager may rely on the prior opinion and negative assurance of such counsel
delivered pursuant to this Section 4(l) to the same extent as if it were dated the date of such Reliance Letter (except that statements
in such prior opinion and negative assurance shall be deemed to relate to the Registration Statement and the Prospectus as amended or
supplemented to the date of such Reliance Letter).
(m) Auditor
Bring Down “Comfort” Letter. Unless waived by the Manager, at each Representation Date, the Company shall cause (1) the
Company’s auditors (the “Accountants”), or other independent accountants satisfactory to the Manager forthwith
to furnish the Manager a letter, and (2) the Chief Financial Officer of the Company forthwith to furnish the Manager a certificate,
in each case dated on such Representation Date, in form satisfactory to the Manager, of the same tenor as the letters and certificate
referred to in Section 6 of this Agreement but modified to relate to the Registration Statement and the Prospectus, as amended and supplemented
to the date of such letters and certificate. Notwithstanding the foregoing, the requirement to deliver or cause to be delivered one or
more letters or certificates under this Section shall at the request of the Company be waived for any Representation Date occurring
at a time at which no Sales Notice is pending or a suspension is in effect, which waiver shall continue until the Company delivers
a Sales Notice hereunder. Notwithstanding the foregoing, if the Company subsequently decides to sell Shares following a Representation
Date when the Company relied on such waiver and did not provide the Manager with a letter or certificate under this Section,
then before the Manager sells any Shares, the Company shall provide the Manager with such letter or certificate dated the date of the Sales
Notice.
(n) Due
Diligence Session. Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering
of the Shares under this Agreement following the termination of a suspension of sales hereunder lasting more than thirty (30) Trading
Days), and at each Representation Date, the Company will conduct a due diligence session, in form and substance, reasonably satisfactory
to the Manager, which shall include representatives of management and Accountants. The Company shall cooperate timely with any reasonable
due diligence request from or review conducted by the Manager or its agents from time to time in connection with the transactions contemplated
by this Agreement, including, without limitation, providing information and available documents and access to appropriate corporate officers
and the Company’s agents during regular business hours, and timely furnishing or causing to be furnished such certificates, letters
and opinions from the Company, its officers and its agents, as the Manager may reasonably request.
(o) Acknowledgment
of Trading. The Company consents to the Manager trading in the Common Stock for the Manager’s own account and for the account
of its clients at the same time as sales of the Shares occur pursuant to this Agreement or pursuant to a Terms Agreement.
(p) Disclosure
of Shares Sold. The Company will disclose in its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, as applicable,
the number of Shares sold through the Manager under this Agreement, the Net Proceeds to the Company and the compensation paid by the Company
with respect to sales of Shares pursuant to this Agreement during the relevant quarter; and, if required by any subsequent change in Commission
policy or request, more frequently by means of a Current Report on Form 8-K or a further Prospectus Supplement.
(q) Rescission
Right. If to the knowledge of the Company, the conditions set forth in Section 6 shall not have been satisfied as of the applicable
Settlement Date, the Company will offer to any person who has agreed to purchase Shares from the Company as the result of an offer to
purchase solicited by the Manager the right to refuse to purchase and pay for such Shares.
(r) Bring
Down of Representations and Warranties. Each acceptance by the Company of an offer to purchase the Shares hereunder, and each execution
and delivery by the Company of a Terms Agreement, shall be deemed to be an affirmation to the Manager that the representations and warranties
of the Company contained in or made pursuant to this Agreement are true and correct in all material respects as of the date of such acceptance
or of such Terms Agreement as though made at and as of such date, and an undertaking that such representations and warranties will be
true and correct as of the Settlement Date for the Shares relating to such acceptance or as of the Time of Delivery relating to such sale,
as the case may be, as though made at and as of such date (except that such representations and warranties shall be deemed to relate to
the Registration Statement and the Prospectus as amended and supplemented relating to such Shares).
(s) Reservation
of Shares. The Company shall ensure that there are at all times sufficient shares of Common Stock to provide for the issuance, free
of any preemptive rights, out of its authorized but unissued shares of Common Stock or shares of Common Stock held in treasury, of the
maximum aggregate number of Shares authorized for issuance by the Board pursuant to the terms of this Agreement. The Company will use
its commercially reasonable efforts to cause the shares to be listed for trading on the Trading Market and to maintain such listing.
(t) Obligation
Under Exchange Act. During any period when the delivery of a prospectus relating to the Shares is required (including in circumstances
where such requirement may be satisfied pursuant to Rule 172, 173 or any similar rule) to be delivered under the Act, the Company
will file all documents required to be filed with the Commission pursuant to the Exchange Act within the time periods required by the
Exchange Act and the regulations thereunder.
(u) DTC
Facility. The Company shall cooperate with Manager and use its reasonable efforts to permit the Shares to be eligible for clearance
and settlement through the facilities of DTC.
(v) Use
of Proceeds. The Company will apply the Net Proceeds from the sale of the Shares in the manner set forth in the Prospectus.
(w) Filing
of Prospectus Supplement. If any sales are made pursuant to this Agreement which are not made in “at the market” offerings
as defined in Rule 415, including, without limitation, any Placement pursuant to a Terms Agreement, the Company shall file a Prospectus
Supplement describing the terms of such transaction, the amount of Shares sold, the price thereof, the Manager’s compensation, and
such other information as may be required pursuant to Rule 424 and Rule 430B, as applicable, within the time required by Rule 424.
(x) Additional
Registration Statement. To the extent that the Registration Statement is not available for the sales of the Shares as contemplated
by this Agreement, the Company shall file a new registration statement with respect to any additional shares of Common Stock necessary
to complete such sales of the Shares and shall cause such registration statement to become effective as promptly as practicable. After
the effectiveness of any such registration statement, all references to “Registration Statement” included in this Agreement
shall be deemed to include such new registration statement, including all documents incorporated by reference therein pursuant to Item 12
of Form S-3, and all references to “Base Prospectus” included in this Agreement shall be deemed to include the final
form of prospectus, including all documents incorporated therein by reference, included in any such registration statement at the time
such registration statement became effective.
5. Payment
of Expenses. The Company agrees to pay the costs and expenses incident to the performance of its obligations under this Agreement,
whether or not the transactions contemplated hereby are consummated, including without limitation: (i) the preparation, printing
or reproduction and filing with the Commission of the Registration Statement (including financial statements and exhibits thereto), the
Prospectus and each Issuer Free Writing Prospectus, and each amendment or supplement to any of them; (ii) the printing (or reproduction)
and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement,
the Prospectus, and each Issuer Free Writing Prospectus, and all amendments or supplements to any of them, as may, in each case, be reasonably
requested for use in connection with the offering and sale of the Shares; (iii) the preparation, printing, authentication, issuance
and delivery of certificates for the Shares, including any stamp or transfer taxes in connection with the original issuance and sale of
the Shares; (iv) the printing (or reproduction) and delivery of this Agreement, any blue sky memorandum and all other agreements
or documents printed (or reproduced) and delivered in connection with the offering of the Shares; (v) the registration of the Shares
under the Exchange Act, if applicable, and the listing of the Shares on the Trading Market; (vi) any registration or qualification
of the Shares for offer and sale under the securities or blue sky laws of the several states (including filing fees and the reasonable
fees and expenses of counsel for the Manager relating to such registration and qualification); (vii) the transportation and other
expenses incurred by or on behalf of Company representatives in connection with presentations to prospective purchasers of the Shares;
(viii) the fees and expenses of the Company’s accountants and the fees and expenses of counsel (including local and special
counsel) for the Company; (ix) the filing fee under FINRA Rule 5110; (x) the reasonable fees and expenses of the Manager’s counsel,
not to exceed $50,000 (excluding any periodic due diligence fees provided for under Section 4(n)), which shall be paid on or before the
Execution Time; and (xi) all other costs and expenses incident to the performance by the Company of its obligations hereunder.
6. Conditions
to the Obligations of the Manager. The obligations of the Manager under this Agreement and any Terms Agreement shall be subject to
(i) the accuracy of the representations and warranties on the part of the Company contained herein as of the Execution Time, each
Representation Date, and as of each Applicable Time, Settlement Date and Time of Delivery, (ii) the performance by the Company of
its obligations hereunder and (iii) the following additional conditions:
(a) Filing
of Prospectus Supplement. The Prospectus, and any supplement thereto, required by Rule 424 to be filed with the Commission have
been filed in the manner and within the time period required by Rule 424(b) with respect to any sale of Shares; each Prospectus Supplement
shall have been filed in the manner required by Rule 424(b) within the time period required hereunder and under the Act; any other
material required to be filed by the Company pursuant to Rule 433(d) under the Act, shall have been filed with the Commission within
the applicable time periods prescribed for such filings by Rule 433; and no stop order suspending the effectiveness of the Registration
Statement or any notice objecting to its use shall have been issued and no proceedings for that purpose shall have been instituted or
threatened.
(b) Delivery
of Opinion. The Company shall have caused the Company Counsel to furnish to the Manager, as requested by the Manager and upon reasonable
advance notice in connection with any offering of the Shares, its opinion and negative assurance statement, dated as of such date and
addressed to the Manager in form and substance acceptable to the Manager.
(c) Delivery
of Officer’s Certificate. The Company shall have furnished or caused to be furnished to the Manager, to the extent requested
by the Manager and upon reasonable advance notice in connection with any offering of the Shares, a certificate of the Company signed by
the Chief Executive Officer or the President and the principal financial or accounting officer of the Company, dated as of such date,
to the effect that the signers of such certificate have carefully examined the Registration Statement, the Prospectus, any Prospectus
Supplement and any documents incorporated by reference therein and any supplements or amendments thereto and this Agreement and that:
(i) the
representations and warranties of the Company in this Agreement are true and correct on and as of such date with the same effect as if
made on such date and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such date;
(ii) no
stop order suspending the effectiveness of the Registration Statement or any notice objecting to its use has been issued and no proceedings
for that purpose have been instituted or, to the Company’s knowledge, threatened; and
(iii) since
the date of the most recent financial statements included in the Registration Statement, the Prospectus and the Incorporated Documents,
there has been no Material Adverse Effect on the condition (financial or otherwise), earnings, business or properties of the Company and
its subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth in
or contemplated in the Registration Statement and the Prospectus.
(d) Delivery
of Accountants’ “Comfort” Letter. The Company shall have requested and caused the Accountants to have furnished
to the Manager letters (which may refer to letters previously delivered to the Manager), dated as of such date, in form and substance
satisfactory to the Manager, confirming that they are independent accountants within the meaning of the Act and the Exchange Act and the
respective applicable rules and regulations adopted by the Commission thereunder and that they have performed a review of any unaudited
interim financial information of the Company included or incorporated by reference in the Registration Statement and the Prospectus and
provide customary “comfort” as to such review in form and substance satisfactory to the Manager.
(e) No
Material Adverse Event. Since the respective dates as of which information is disclosed in the Registration Statement, the Prospectus
and the Incorporated Documents, except as otherwise stated therein, there shall not have been (i) any change or decrease in previously
reported results specified in the letter or letters referred to in paragraph (d) of this Section 6 or (ii) any change, or any
development involving a prospective change, in or affecting the condition (financial or otherwise), earnings, business or properties of
the Company and its subsidiaries taken as a whole, whether or not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Registration Statement, the Prospectus and the Incorporated Documents (exclusive of any amendment
or supplement thereto) the effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole judgment of
the Manager, so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Shares as
contemplated by the Registration Statement (exclusive of any amendment thereof), the Incorporated Documents and the Prospectus (exclusive
of any amendment or supplement thereto).
(f) Payment
of All Fees. The Company shall have paid the required Commission filing fees relating to the Shares within the time period required
by Rule 456(b)(1)(i) of the Act without regard to the proviso therein and otherwise in accordance with Rules 456(b) and 457(r)
of the Act and, if applicable, shall have updated the “Calculation of Registration Fee” table in accordance with Rule 456(b)(1)(ii)
either in a post-effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule 424(b).
(g) No
FINRA Objections. FINRA shall not have raised any objection with respect to the fairness and reasonableness of the terms and arrangements
under this Agreement.
(h) Shares
Listed on Trading Market. The Shares shall have been listed and admitted and authorized for trading on the Trading Market, and satisfactory
evidence of such actions shall have been provided to the Manager.
(i) Other
Assurances. Prior to each Settlement Date and Time of Delivery, as applicable, the Company shall have furnished to the Manager such
further information, certificates and documents as the Manager may reasonably request.
If any of the conditions specified
in this Section 6 shall not have been fulfilled when and as provided in this Agreement, or if any of the opinions and certificates mentioned
above or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance to the Manager and counsel for the Manager,
this Agreement and all obligations of the Manager hereunder may be canceled at, or at any time prior to, any Settlement Date or Time of
Delivery, as applicable, by the Manager. Notice of such cancellation shall be given to the Company in writing or by telephone and confirmed
in writing by electronic mail.
The documents required to
be delivered by this Section 6 shall be delivered to the office of Sheppard, Mullin, Richter & Hampton LLP, counsel for the Manager,
at 30 Rockefeller Plaza, New York, New York 10112, email: rafriedman@sheppardmullin.com, on each such date as provided in this Agreement.
7. Indemnification
and Contribution.
(a) Indemnification
by Company. The Company agrees to indemnify and hold harmless the Manager, the directors, officers, employees and agents of the Manager
and each person who controls the Manager within the meaning of either the Act or the Exchange Act against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may become subject under the Act, the Exchange Act or other Federal
or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration
Statement for the registration of the Shares as originally filed or in any amendment thereof, or in the Base Prospectus, any Prospectus
Supplement, the Prospectus, any Issuer Free Writing Prospectus, or in any amendment thereof or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading arise out of or are based upon any Proceeding, commenced or threatened (whether or not the Manager is
a target of or party to such Proceeding) or result from or relate to any breach of any of the representations, warranties, covenants or
agreements made by the Company in this Agreement, and agrees to reimburse each such indemnified party for any legal or other out-of-pocket
expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to the Company by the Manager specifically for inclusion
therein. This indemnity agreement will be in addition to any liability that the Company may otherwise have.
(b) Indemnification
by Manager. The Manager agrees to indemnify and hold harmless the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to the Manager, but only with reference to written information relating to the Manager
furnished to the Company by the Manager specifically for inclusion in the documents referred to in the foregoing indemnity; provided,
however, that in no case shall the Manager be responsible for any amount in excess of the Broker Fee applicable to the Shares and
paid hereunder. This indemnity agreement will be in addition to any liability which the Manager may otherwise have.
(c) Indemnification
Procedures. Promptly after receipt by an indemnified party under this Section 7 of notice of the commencement of any action,
such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve
it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such
failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event, relieve
the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a)
or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying
party’s expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying
party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party’s election to appoint counsel to represent the indemnified party in an action, the indemnified
party shall have the right to employ separate counsel (including local counsel), and the indemnifying party shall bear the reasonable
fees, costs and out-of-pocket expenses of such separate counsel if (i) the use of counsel chosen by the indemnifying party to represent
the indemnified party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets
of, any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available
to the indemnifying party, (iii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified
party to represent the indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party. An indemnifying party
will not, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise
or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding.
(d) Contribution.
In the event that the indemnity provided in paragraph (a), (b) or (c) of this Section 7 is unavailable to or insufficient
to hold harmless an indemnified party for any reason, the Company and the Manager agree to contribute to the aggregate losses, claims,
damages and liabilities (including legal or other reasonable out-of-pocket expenses reasonably incurred in connection with investigating
or defending the same) (collectively “Losses”) to which the Company and the Manager may be subject in such proportion
as is appropriate to reflect the relative benefits received by the Company on the one hand and by the Manager on the other from the offering
of the Shares; provided, however, that in no case shall the Manager be responsible for any amount in excess of the Broker
Fee applicable to the Shares and paid hereunder. If the allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company and the Manager severally shall contribute in such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company on the one hand and of the Manager on the other in connection with the statements
or omissions which resulted in such Losses as well as any other relevant equitable considerations. Benefits received by the Company shall
be deemed to be equal to the total net proceeds from the offering (before deducting expenses) received by it, and benefits received by
the Manager shall be deemed to be equal to the Broker Fee applicable to the Shares and paid hereunder as determined by this Agreement.
Relative fault shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to information provided by the Company on the one hand or the
Manager on the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The Company and the Manager agree that it would not be just and equitable if contribution were determined
by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 7, each person who controls the Manager within the meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of the Manager shall have the same rights to contribution as the Manager, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, each officer of the Company who shall have signed the Registration Statement
and each director of the Company shall have the same rights to contribution as the Company, subject in each case to the applicable terms
and conditions of this paragraph (d).
8. Termination.
(a) The
Company shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating
to the solicitation of offers to purchase the Shares in its sole discretion at any time upon five (5) Business Days’ prior written
notice. Any such termination shall be without liability of any party to any other party except that (i) with respect to any pending
sale, through the Manager for the Company, the obligations of the Company, including in respect of compensation of the Manager, shall
remain in full force and effect notwithstanding the termination and (ii) the provisions of Sections 5, 6, 7, 8, 9, 10, 12, 14
and 15 of this Agreement shall remain in full force and effect notwithstanding such termination.
(b) The
Manager shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating
to the solicitation of offers to purchase the Shares in its sole discretion at any time. Any such termination shall be without liability
of any party to any other party except that the provisions of Sections 5, 6, 7, 8, 9, 10, 12, 14 and 15 of this Agreement shall remain
in full force and effect notwithstanding such termination.
(c) This
Agreement shall remain in full force and effect until such date that this Agreement is terminated pursuant to Sections 8(a) or (b) above
or otherwise by mutual agreement of the parties, provided that any such termination by mutual agreement shall in all cases be deemed to
provide that Sections 5, 6, 7, 8, 9, 10, 12, 14 and 15 of this Agreement shall remain in full force and effect.
(d) Any
termination of this Agreement shall be effective on the date specified in such notice of termination, provided that such termination shall
not be effective until the close of business on the date of receipt of such notice by the Manager or the Company, as the case may be.
If such termination shall occur prior to the Settlement Date or Time of Delivery for any sale of the Shares, such sale of the Shares shall
settle in accordance with the provisions of Section 2(b) of this Agreement.
(e) In
the case of any purchase of Shares by the Manager pursuant to a Terms Agreement, the obligations of the Manager pursuant to such Terms
Agreement shall be subject to termination, in the absolute discretion of the Manager, by prompt oral notice given to the Company prior
to the Time of Delivery relating to such Shares, if any, and confirmed promptly by electronic mail, if since the time of execution of
the Terms Agreement and prior to such delivery and payment, (i) trading in the Common Stock shall have been suspended by the Commission
or the Trading Market or trading in securities generally on the Trading Market shall have been suspended or limited or minimum prices
shall have been established on such exchange, (ii) a banking moratorium shall have been declared either by Federal or New York State
authorities or (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial markets is such as to make it, in the sole judgment of
the Manager, impractical or inadvisable to proceed with the offering or delivery of the Shares as contemplated by the Prospectus (exclusive
of any amendment or supplement thereto).
9. Representations
and Indemnities to Survive. The respective agreements, representations, warranties, indemnities and other statements of the Company
or its officers and of the Manager set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by the Manager or the Company or any of the officers, directors, employees, agents or controlling persons referred
to in Section 7, and will survive delivery of and payment for the Shares.
10. Notices.
All communications hereunder will be in writing and effective only on receipt, and will be mailed, delivered, or e-mailed to the addresses
of the Company and the Manager, respectively, set forth on the signature page hereto.
11. Successors.
This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers, directors,
employees, agents and controlling persons referred to in Section 7, and no other person will have any right or obligation hereunder.
12. No
Fiduciary Duty. The Company hereby acknowledges that (a) the purchase and sale of the Shares pursuant to this Agreement is an
arm’s-length commercial transaction between the Company, on the one hand, and the Manager and any affiliate through which it may
be acting, on the other, (b) the Manager is acting solely as sales agent and/or principal in connection with the purchase and sale
of the Company’s securities and not as a fiduciary of the Company and (c) the Company’s engagement of the Manager in
connection with the offering and the process leading up to the offering is as independent contractors and not in any other capacity. Furthermore,
the Company agrees that it is solely responsible for making its own judgments in connection with the offering (irrespective of whether
the Manager has advised or is currently advising the Company on related or other matters). The Company agrees that it will not claim that
the Manager has rendered advisory services of any nature or respect, or owe an agency, fiduciary or similar duty to the Company, in connection
with such transaction or the process leading thereto.
13. Integration.
This Agreement and any Terms Agreement supersede all prior agreements and understandings (whether written or oral) between the Company
and the Manager with respect to the subject matter hereof. Notwithstanding anything herein to the contrary, the letter agreement, dated
May 13, 2024, by and between the Company and the Manager shall continue to be effective and the terms therein shall continue to survive
and be enforceable by the Manager in accordance with its terms, provided that, in the event of a conflict between the terms of the letter
agreement and this Agreement, the terms of this Agreement shall prevail.
14. Amendments;
Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in
the case of an amendment, by the Company and the Manager. No waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right.
15. Applicable
Law. This Agreement and any Terms Agreement will be governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed within the State of New York. Each of the Company and the Manager: (i) agrees that
any legal suit, action or proceeding arising out of or relating to this Agreement shall be instituted exclusively in New York Supreme
Court, County of New York, or in the United States District Court for the Southern District of New York, (ii) waives any objection which
it may have or hereafter to the venue of any such suit, action or proceeding, and (iii) irrevocably consents to the exclusive jurisdiction
of the New York Supreme Court, County of New York, and the United States District Court for the Southern District of New York in any such
suit, action or proceeding. Each of the Company and the Manager further agrees to accept and acknowledge service of any and all process
which may be served in any such suit, action or proceeding in the New York Supreme Court, County of New York, or in the United States
District Court for the Southern District of New York and agrees that service of process upon the Company mailed by certified mail to the
Company’s address shall be deemed in every respect effective service of process upon the Company, in any such suit, action or proceeding,
and service of process upon the Manager mailed by certified mail to the Manager’s address shall be deemed in every respect effective
service process upon the Manager, in any such suit, action or proceeding. If either party shall commence an action or proceeding to enforce
any provision of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its
reasonable attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action
or proceeding.
16. Waiver
of Jury Trial. The Company hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial
by jury in any legal proceeding arising out of or relating to this Agreement, any Terms Agreement or the transactions contemplated hereby
or thereby.
17. Counterparts.
This Agreement and any Terms Agreement may be executed in one or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon one and the same agreement. Counterparts may be delivered via electronic mail
(including any electronic signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic
Signatures and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered
shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
18. Headings.
The section headings used in this Agreement and any Terms Agreement are for convenience only and shall not affect the construction hereof.
■
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***************************
If the foregoing is in accordance
with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance
shall represent a binding agreement among the Company and the Manager.
Very truly yours,
NEONODE Inc.
By: |
/s/ Fredrik Nihlén |
|
Name: |
Fredrik Nihlén |
|
Title: |
Interim Chief Executive Officer |
|
Address for Notice:
Neonode Inc.
Karlavägen 100, 115 26
Stockholm, Sweden
Attention: Fredrik Nihlén
Telephone: [***]
Email: [***]
with a copy to:
Reed Smith LLP
1841 Page Mill Road, Suite 110
Palo Alto, CA 94304
Attention: Donald C. Reinke
Telephone: (650) 352-0532
Email: dreinke@reedsmith.com
The foregoing Agreement is hereby confirmed and accepted as of the
date first written above.
LADENBURG THALMANN & CO. INC.
By: |
/s/ Nicholas Stergis |
|
Name: |
Nicholas Stergis |
|
Title: |
Managing Director |
|
Address for Notice:
640 Fifth Avenue, 4th Floor
New York, NY 10019
Form of Terms Agreement
ANNEX I
NEONODE INC.
TERMS AGREEMENT
Dear Sirs:
Neonode Inc.
(the “Company”) proposes, subject to the terms and conditions stated herein and in the At The Market Offering
Agreement, dated June 4, 2024 (the “At The Market Offering Agreement”), between the Company and Ladenburg Thalmann
& Co. Inc. (“Manager”), to issue and sell to Manager the securities specified in the Schedule I
hereto (the “Purchased Shares”).
Each of the
provisions of the At The Market Offering Agreement not specifically related to the solicitation by the Manager, as agent of the Company,
of offers to purchase securities is incorporated herein by reference in its entirety, and shall be deemed to be part of this Terms Agreement
to the same extent as if such provisions had been set forth in full herein. Each of the representations and warranties set forth therein
shall be deemed to have been made at and as of the date of this Terms Agreement and the Time of Delivery, except that each representation
and warranty in Section 3 of the At The Market Offering Agreement which makes reference to the Prospectus (as therein defined) shall
be deemed to be a representation and warranty as of the date of the At The Market Offering Agreement in relation to the Prospectus, and
also a representation and warranty as of the date of this Terms Agreement and the Time of Delivery in relation to the Prospectus as amended
and supplemented to relate to the Purchased Shares.
An amendment
to the Registration Statement (as defined in the At The Market Offering Agreement), or a supplement to the Prospectus, as the case may
be, relating to the Purchased Shares, in the form heretofore delivered to the Manager is now proposed to be filed with the Securities
and Exchange Commission.
Subject to the
terms and conditions set forth herein and in the At The Market Offering Agreement which are incorporated herein by reference, the Company
agrees to issue and sell to the Manager and the latter agrees to purchase from the Company the number of shares of the Purchased Shares
at the time and place and at the purchase price set forth in the Schedule I hereto.
If
the foregoing is in accordance with your understanding, please sign and return to us a counterpart hereof, whereupon this Terms Agreement,
including those provisions of the At The Market Offering Agreement incorporated herein by reference, shall constitute a binding agreement
between the Manager and the Company.
NEONODE Inc.
ACCEPTED as of the date first written above.
LADENBURG THALMANN & CO. INC.
37
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Grafico Azioni Neonode (NASDAQ:NEON)
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