Exhibit 1.1
MERSANA
THERAPEUTICS, INC.
$100,000,000
common
stock
SALES
AGREEMENT
February 28, 2022
Xxxxx and Company, LLC
000 Xxxxxxxxx Xxxxxx
New York, NY 10022
Ladies and Gentlemen:
Mersana Therapeutics, Inc.
(the “Company”), confirms its agreement (this “Agreement”) with Xxxxx and Company,
LLC (“Cowen”), as follows:
1. Issuance
and Sale of Shares. The Company agrees that, from time to time during the term of this Agreement, on the terms and subject to the
conditions set forth herein, it may issue and sell through Cowen, acting as agent and/or principal, shares (the “Placement
Shares”) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”),
having an aggregate offering price of up to $100,000,000. Notwithstanding anything to the contrary contained herein, the parties hereto
agree that compliance with the limitation set forth in this Section 1 on the number of shares of Common Stock issued
and sold under this Agreement shall be the sole responsibility of the Company, and Cowen shall have no obligation in connection with
such compliance. The issuance and sale of Common Stock through Cowen will be effected pursuant to the Registration Statement (as defined
below) to be filed by the Company and declared effective by the Securities and Exchange Commission (the “Commission”),
although nothing in this Agreement shall be construed as requiring the Company to use the Registration Statement (as defined below) to
issue the Common Stock.
The Company has filed,
in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively, the “Securities Act”), with the Commission a registration statement on Form S-3 (File
No. 333-260895), including a base prospectus (the “Base Prospectus”), relating to certain securities,
including the Common Stock, to be issued from time to time by the Company, and which incorporates by reference documents that the
Company has filed or will file in accordance with the provisions of the Securities Exchange Act of 1934, as amended, and the
rules and regulations thereunder (collectively, the “Exchange Act”). The Company has prepared a
prospectus supplement specifically relating to the Placement Shares (the “Prospectus Supplement” and
together with the Base Prospectus, the “Sales Prospectus”) included as part of such registration
statement. Following the date that such registration statement is declared effective, the Company shall furnish to Cowen, for use by
Cowen, copies of the Sales Prospectus, as supplemented from time to time, relating to the Placement Shares. Except where the context
otherwise requires, such registration statement, as amended when it becomes effective, including all documents filed as part thereof
or incorporated by reference therein, and including any information contained in a Prospectus (as defined below) subsequently filed
with the Commission pursuant to Rule 424(b) under the Securities Act or deemed to be a part of such registration statement
pursuant to Rule 430B or 462(b) of the Securities Act, is herein called the “Registration
Statement.” The Sales Prospectus, including all documents incorporated therein by reference, included in the
Registration Statement, as it may be supplemented by one or more additional prospectus supplements, in the form in which such
prospectus and/or Sales Prospectus have most recently been filed by the Company with the Commission pursuant to
Rule 424(b) under the Securities Act, together with any “issuer free writing prospectus,” as defined in
Rule 433 of the Securities Act regulations (“Rule 433”), relating to the Placement Shares that
(i) is required to be filed with the Commission by the Company or (ii) is exempt from filing pursuant to
Rule 433(d)(5)(i), in each case in the form filed or required to be filed with the Commission or, if not required to be filed,
in the form retained in the Company’s records pursuant to Rule 433(g), is herein called the
“Prospectus.” Any reference herein to the Registration Statement, the Prospectus or any amendment or
supplement thereto shall be deemed to refer to and include the documents incorporated by reference therein, and any reference herein
to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement or
the Prospectus shall be deemed to refer to and include the filing after the execution hereof of any document with the Commission
deemed to be incorporated by reference therein. For purposes of this Agreement, all references to the Registration Statement, the
Prospectus or to any amendment or supplement thereto shall be deemed to include any copy filed with the Commission pursuant to the
Electronic Data Gathering Analysis and Retrieval System (“XXXXX”).
2. Placements.
Each time that the Company wishes to issue and sell the Placement Shares hereunder (each, a “Placement”), it
will notify Cowen by email notice (or other method mutually agreed to in writing by the parties) (a “Placement Notice”)
containing the parameters in accordance with which it desires the Placement Shares to be sold, which shall at a minimum include the number
of Placement Shares to be issued, the time period during which sales are requested to be made, any limitation on the number of Placement
Shares that may be sold in any one Trading Day (as defined in Section 3) and any minimum price below which sales may
not be made, a form of which containing such minimum sales parameters necessary is attached hereto as Schedule 1. The Placement
Notice shall originate from any of the individuals from the Company set forth on Schedule 2 (with a copy to each of the
other individuals from the Company listed on such schedule), and shall be addressed to each of the individuals from Cowen set forth on
Schedule 2, as such Schedule 2 may be amended in writing from time to time. The Placement Notice shall be
effective upon receipt by Cowen unless and until (i) in accordance with the notice requirements set forth in Section 4,
Cowen declines to accept the terms contained therein for any reason, in its sole discretion, (ii) the entire amount of the Placement
Shares thereunder have been sold, (iii) in accordance with the notice requirements set forth in Section 4, the Company suspends
or terminates the Placement Notice for any reason, in its sole discretion, (iv) the Company issues a subsequent Placement Notice
with parameters superseding those on the earlier dated Placement Notice, or (v) this Agreement has been terminated under the provisions
of Section 11. The amount of any discount, commission or other compensation to be paid by the Company to Cowen in
connection with the sale of the Placement Shares shall be calculated in accordance with the terms set forth in Schedule 3.
It is expressly acknowledged and agreed that neither the Company nor Cowen will have any obligation whatsoever with respect to a
Placement or any Placement Shares unless and until the Company delivers a Placement Notice to Cowen and Cowen does not decline such Placement
Notice pursuant to the terms set forth above, and then only upon the terms specified therein and herein. In the event of a conflict between
the terms of this Agreement and the terms of a Placement Notice, the terms of the Placement Notice will control.
3. Sale
of Placement Shares by Cowen. Subject to the terms and conditions herein set forth, upon the Company’s delivery of a Placement
Notice, and unless the sale of the Placement Shares described therein has been declined, suspended, or otherwise terminated in accordance
with the terms of this Agreement, Cowen, for the period specified in the Placement Notice, will use its commercially reasonable efforts
consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of
the Nasdaq Global Select Market (“Nasdaq”) to sell such Placement Shares up to the amount specified, and otherwise
in accordance with the terms of such Placement Notice. Cowen will provide written confirmation to the Company (including by email correspondence
to each of the individuals of the Company set forth on Schedule 2, if receipt of such correspondence is actually acknowledged
by any of the individuals to whom the notice is sent, other than via auto-reply) no later than the opening of the Trading Day (as defined
below) immediately following the Trading Day on which it has made sales of Placement Shares hereunder setting forth the number of Placement
Shares sold on such day, the volume-weighted average price of the Placement Shares sold, and the Net Proceeds (as defined below) payable
to the Company. Cowen may sell Placement Shares by any method permitted by law deemed to be an “at the market” offering as
defined in Rule 415 of the Securities Act, including without limitation sales made through Nasdaq or on any other existing trading
market for the Common Stock. Cowen shall not purchase Placement Shares for its own account as principal unless expressly authorized to
do so by the Company in a Placement Notice. The Company acknowledges and agrees that (i) there can be no assurance that Cowen will
be successful in selling Placement Shares, and (ii) Cowen will incur no liability or obligation to the Company or any other person
or entity if it does not sell Placement Shares for any reason other than a failure by Cowen to use its commercially reasonable efforts
consistent with its normal trading and sales practices to sell such Placement Shares as required under this Section 3.
For the purposes hereof, “Trading Day” means any day on which the Company’s Common Stock is purchased
and sold on the principal market on which the Common Stock is listed or quoted. In the event the Company engages Cowen for a sale of
Shares that would constitute a “block” within the meaning of Rule 10b-18(a)(5) under the Exchange Act (a “Block
Sale”), the Company will provide Cowen, at Xxxxx’x request and upon reasonable advance notice to the Company, on
or prior to the Settlement Date, the opinions of counsel, accountant’s letter and officers’ certificates set forth in Section 8
hereof, each dated the Settlement Date, and such other documents and information as Cowen shall reasonably request.
4. Suspension
of Sales.
(a) The
Company or Cowen may, upon notice to the other party in writing (including by email correspondence to each of the individuals of the other
party set forth on Schedule 2, if receipt of such correspondence is actually acknowledged by any of the individuals to whom
the notice is sent, other than via auto-reply) or by telephone (confirmed immediately by verifiable facsimile transmission or email correspondence
to each of the individuals of the other party set forth on Schedule 2), suspend any sale of Placement Shares; provided,
however, that such suspension shall not affect or impair either party’s obligations with respect to any Placement Shares sold
hereunder prior to the receipt of such notice. Each of the parties agrees that no such notice under this Section 4
shall be effective against the other unless it is made to one of the individuals named on Schedule 2 hereto, as such schedule
may be amended from time to time.
(b) Notwithstanding
any other provision of this Agreement, during any period in which the Company is in possession of material non-public information, the
Company and Cowen agree that (i) no sale of Placement Shares will take place, (ii) the Company shall not request the sale of
any Placement Shares, and (iii) Cowen shall not be obligated to sell or offer to sell any Placement Shares.
(c) If
either Cowen or the Company has reason to believe that the exemptive provisions set forth in Rule 101(c)(1) of Regulation M
under the Exchange Act are not satisfied with respect to the Common Stock, it shall promptly notify the other party, and Cowen may, at
its sole discretion, suspend sales of the Placement Shares under this Agreement.
(d) Notwithstanding
any other provision of this Agreement, during any period in which the Registration Statement is not effective under the Securities Act,
the Company shall promptly notify Cowen, the Company shall not request the sale of any Placement Shares, and Cowen shall not be obligated
to sell or offer to sell any Placement Shares.
5. Settlement.
(a) Settlement
of Placement Shares. Unless otherwise specified in the applicable Placement Notice, settlement for sales of Placement Shares will
occur on the second (2nd) Trading Day (or such earlier day as is industry practice for regular-way trading) following the
date on which such sales are made (each, a “Settlement Date” and the first such settlement date, the “First
Delivery Date”). The amount of proceeds to be delivered to the Company on a Settlement Date against receipt of the Placement
Shares sold (the “Net Proceeds”) will be equal to the aggregate sales price received by Cowen at which such
Placement Shares were sold, after deduction for (i) Xxxxx’x commission, discount or other compensation for such sales payable
by the Company pursuant to Section 2 hereof, (ii) any other amounts due and payable by the Company to Cowen hereunder
pursuant to Section 7(g) (Expenses) hereof, and (iii) any transaction fees imposed by any
governmental or self-regulatory organization in respect of such sales; provided that Cowen shall promptly notify the Company if the calculation
of any Net Proceeds reflects deductions pursuant to clauses (ii) or (iii).
(b) Delivery
of Placement Shares. On or before each Settlement Date, the Company will, or will cause its transfer agent to, electronically transfer
the Placement Shares being sold by crediting Xxxxx’x or its designee’s account (provided Cowen shall have given the Company
written notice of such designee prior to the Settlement Date) at The Depository Trust Company 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 in all cases shall be freely tradeable,
transferable, registered shares in good deliverable form. On each Settlement Date, Cowen will deliver the related Net Proceeds in same
day funds to an account designated by the Company on, or prior to, the Settlement Date. The Company agrees that if the Company, or its
transfer agent (if applicable), defaults in its obligation to deliver duly authorized Placement Shares on a Settlement Date, the Company
agrees that in addition to and in no way limiting the rights and obligations set forth in Section 9(a) (Indemnification
and Contribution) hereto, it will (i) hold Cowen harmless against any loss, claim, damage, or reasonable and documented
expense (including reasonable legal fees and expenses), as incurred, arising out of or in connection with such default by the Company
and (ii) pay to Cowen (without duplication) any commission, discount, or other compensation to which it would otherwise have been
entitled absent such default.
6. Representations
and Warranties of the Company. The Company represents and warrants to, and agrees with, Cowen that as of the date of this Agreement,
each Representation Date (as defined in Section 7(m)), each date on which a Placement Notice is given, and any date
on which Placement Shares are sold hereunder:
(a) Compliance
with Registration Requirements. The Registration Statement and any Rule 462(b) Registration Statement shall have been declared
effective by the Commission under the Securities Act. The Company shall have complied to the Commission’s satisfaction with all
requests of the Commission for additional or supplemental information with respect to the Registration Statement. No stop order suspending
the effectiveness of the Registration Statement or any Rule 462(b) Registration Statement is in effect and no proceedings for
such purpose have been instituted or are pending or, to the knowledge of the Company, contemplated or threatened by the Commission. The
Company meets the requirements for use of Form S-3 under the Securities Act. The sale of the Placement Shares hereunder meets
the requirements of General Instruction I.B.1 of Form S-3.
(b) No
Misstatement or Omission. The Prospectus when filed will comply or complied and, as amended or supplemented, if applicable, will
comply in all material respects with the Securities Act. Each of the Registration Statement, any Rule 462(b) Registration
Statement, the Prospectus and any post-effective amendments or supplements thereto, at the time it becomes effective or its date, as
applicable, will comply or complied and as of each Applicable Time, will comply or complied in all material respects with the
Securities Act and did not and, as of each Applicable Time, did not and will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The
Prospectus, as amended or supplemented, as of its date, did not and, as of each Applicable Time, will not contain any untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The representations and warranties set forth in the two immediately
preceding sentences do not apply to statements in or omissions from the Registration Statement, any
Rule 462(b) Registration Statement, or any post-effective amendment thereto, or the Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with information relating to Cowen furnished to the Company in writing
by Cowen expressly for use therein. There are no contracts or other documents required to be described in the Prospectus or to be
filed as exhibits to the Registration Statement which have not been described or filed as required.
(c) Offering
Materials Furnished to Cowen. The Company has delivered to Cowen one complete copy of the Registration Statement and a copy of each
consent and certificate of experts filed as a part thereof, and conformed copies of the Registration Statement (without exhibits) and
the Prospectus, as amended or supplemented, in such quantities and at such places as Cowen has reasonably requested.
(d) Emerging
Growth Company. The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act.
The Company agrees to notify Cowen promptly upon the Company ceasing to be an emerging growth company.
(e) Not
an Ineligible Issuer. The Company currently is not an “ineligible issuer,” as defined in Rule 405 of the rules and
regulation of the Commission. The Company agrees to notify Cowen promptly upon the Company becoming an “ineligible issuer.”
(f) Distribution
of Offering Material By the Company. The Company has not distributed and will not distribute, prior to the completion of Xxxxx’x
distribution of the Placement Shares, any offering material in connection with the offering and sale of the Placement Shares other than
the Prospectus or the Registration Statement.
(g) The
Sales Agreement. This Agreement has been duly authorized, executed and delivered by, and is a valid and binding agreement of, the
Company, enforceable in accordance with its terms, except as rights to indemnification hereunder may be limited by applicable law and
except as the enforcement hereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to
or affecting the rights and remedies of creditors or by general equitable principles.
(h) The
Placement Shares. The Placement Shares to be issued and sold by the Company hereunder have been duly authorized and, when issued and
delivered and paid for as provided herein, will be duly and validly issued, will be fully paid and nonassessable and will conform in all
material respects to the descriptions thereof in the Registration Statement and the Prospectus; and the issuance of the Placement Shares
is not subject to any preemptive or similar rights that have not been duly waived or satisfied.
(i) No
Applicable Registration or Other Similar Rights. There are no persons with registration or other similar rights to have any equity
or debt securities registered for sale under the Registration Statement or included in the offering contemplated by this Agreement, except
for such rights as have been duly waived.
(j) No
Material Adverse Change. Since the date of the most recent financial statements of the Company incorporated by reference into the
Registration Statement and the Prospectus, (i) there has not been any material change in the capital stock (other than the issuance
of shares of Common Stock upon exercise of stock options and warrants described as outstanding in, and the grant of options and awards
under existing equity incentive plans described in, the Registration Statement and the Prospectus), short-term debt or long-term debt
of the Company and its subsidiary, taken as a whole, or any dividend or distribution of any kind declared, set aside for payment, paid
or made by the Company on any class of capital stock, or any material adverse change, or any development that would reasonably be expected
to result in a prospective material adverse change, in or affecting the business, properties, management, financial position, stockholders’
equity, results of operations or prospects of the Company and its subsidiary taken as a whole (any such change is called a “Material
Adverse Change”); (ii) neither the Company nor its subsidiary has entered into any transaction or agreement (whether
or not in the ordinary course of business) that is material to the Company and its subsidiary taken as a whole or incurred any liability
or obligation, direct or contingent, that is material to the Company and its subsidiary taken as a whole; and (iii) neither the Company
nor its subsidiary has sustained any loss or interference with its business that is material to the Company and its subsidiary taken as
a whole and that is either from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance
or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise
disclosed in the Registration Statement and the Prospectus.
(k) Independent
Accountants. Ernst & Young LLP, who have certified certain financial statements of the Company and its subsidiary, is an
independent registered public accounting firm with respect to the Company and its subsidiary within the applicable rules and regulations
adopted by the Commission and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act.
(l) Financial
Statements. The financial statements (including the related notes thereto) of the Company and its consolidated subsidiary incorporated
by reference into the Registration Statement and the Prospectus comply in all material respects with the applicable requirements of the
Securities Act and present fairly in all material respects the financial position of the Company and its consolidated subsidiary as of
the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such financial
statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) in the United
States applied on a consistent basis throughout the periods covered thereby, except in the case of any unaudited, interim financial statements,
which are subject to normal year-end adjustments and do not contain certain footnotes as permitted by the applicable rules of the
Commission, and any supporting schedules incorporated by reference into the Registration Statement present fairly in all material respects
the information required to be stated therein; and the other financial information incorporated by reference into the Registration Statement
and the Prospectus has been derived from the accounting records of the Company and its consolidated subsidiary and presents fairly in
all material respects the information shown thereby.
(m) Organization
and Good Standing. The Company and its subsidiary have been duly organized and are validly existing and in good standing under the
laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in each jurisdiction
in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and
have all power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged,
except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the business, properties, management, financial position, stockholders’
equity, results of operations or prospects of the Company and its subsidiary taken as a whole or on the performance by the Company of
its obligations under this Agreement (a “Material Adverse Effect”). The Company does not own or control,
directly or indirectly, any corporation, association or other entity other than the subsidiary listed on Schedule 4.
(n) Capitalization.
The Company has an authorized capitalization as set forth in the Registration Statement under the heading “Description of Common
Stock”; all the outstanding shares of capital stock of the Company have been duly and validly authorized and issued and are fully
paid and non-assessable and are not subject to any pre-emptive or similar rights that have not been duly waived or satisfied; except as
described in or expressly contemplated by the Prospectus, there are no outstanding rights (including, without limitation, pre-emptive
rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any shares of capital stock or other equity
interest in the Company or its subsidiary, or any contract, commitment, agreement, understanding or arrangement of any kind relating to
the issuance of any capital stock of the Company or any such subsidiary, any such convertible or exchangeable securities or any such rights,
warrants or options; the capital stock of the Company conforms in all material respects to the description thereof contained in the Registration
Statement and the Prospectus; and all the outstanding shares of capital stock or other equity interests of the subsidiary owned, directly
or indirectly, by the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly
or indirectly by the Company, free and clear of any lien, charge, encumbrance, security interest, restriction on voting or transfer or
any other claim of any third party.
(o) Stock
Options. With respect to the stock options (the “Stock Options”) granted pursuant to the stock-based compensation
plans of the Company and its subsidiary (the “Company Stock Plans”), except, in each case, for any such matters
as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) each grant of a Stock
Option was duly authorized no later than the date on which the grant of such Stock Option was by its terms to be effective (the “Grant
Date”) by all necessary corporate action, including, as applicable, approval by the board of directors of the Company (or
an authorized committee thereof), and the award agreement governing such grant (if any) was duly executed and delivered by each party
thereto, (ii) each such grant was made in accordance with the terms of the Company Stock Plans and all other applicable laws and
regulatory rules or requirements, and (ii) each such grant was properly accounted for in accordance with GAAP in the financial
statements (including the related notes) of the Company.
(p) Due
Authorization. The Company has full right, power and authority to execute and deliver this Agreement and to perform its obligations
hereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of this Agreement and
the consummation by it of the transactions contemplated hereby has been duly and validly taken.
(q) No
Violation or Default. Neither the Company nor its subsidiary is (i) in violation of its charter or by-laws or similar organizational
documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default,
in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or its subsidiary is a party or by which the Company or its subsidiary is bound
or to which any property or asset of the Company or its subsidiary is subject; or (iii) in violation of any law or statute or any
judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority having jurisdiction over the
Company, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(r) No
Conflicts. The execution, delivery and performance by the Company of this Agreement, the issuance and sale of the Placement Shares
by the Company and the consummation of the transactions contemplated by this Agreement will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property, right or asset of the Company or its subsidiary pursuant to, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the Company or its subsidiary is a party or by which the Company or
its subsidiary is bound or to which any property, right or asset of the Company or its subsidiary is subject, (ii) result in any
violation of the provisions of the charter or by-laws or similar organizational documents of the Company or its subsidiary or (iii) result
in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or
regulatory authority having jurisdiction over the Company, except, in the case of clauses (i) and (iii) above, for any such
conflict, breach, violation, default, lien, charge or encumbrance that would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(s) No
Consents Required. No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or
governmental or regulatory authority is required for the execution, delivery and performance by the Company of this Agreement, the issuance
and sale of the Placement Shares by the Company and the consummation of the transactions contemplated by this Agreement, except for the
registration of the Placement Shares under the Securities Act and such consents, approvals, authorizations, orders and registrations or
qualifications as may be required by the Financial Industry Regulatory Authority, Inc. (“FINRA”) and under
applicable state securities laws in connection with the purchase and distribution of the Placement Shares by Cowen.
(t) Legal
Proceedings. Except as described in the Registration Statement and the Prospectus, there are no legal, governmental or regulatory
investigations, actions, demands, claims, suits, arbitrations, inquiries or proceedings (“Actions”) pending
to which the Company or its subsidiary is a party or to which any property of the Company or its subsidiary is the subject that, individually
or in the aggregate, if determined adversely to the Company or its subsidiary, would reasonably be expected to have a Material Adverse
Effect; to the knowledge of the Company, no such Actions are threatened or contemplated by any governmental or regulatory authority or
threatened by others; and (i) there are no current or pending Actions that are required under the Securities Act to be described
in the Registration Statement or the Prospectus that are not so described in the Registration Statement and the Prospectus and (ii) there
are no statutes, regulations or contracts or other documents that are required under the Securities Act to be filed as exhibits to the
Registration Statement or described in the Registration Statement or the Prospectus that are not so filed as exhibits to the Registration
Statement or described in the Registration Statement and the Prospectus.
(u) Title
to Real and Personal Property. The Company and its subsidiary have good and marketable title in fee simple (in the case of real property)
to, or have valid rights to lease or otherwise use, all items of real and personal property that are material to the businesses of the
Company and its subsidiary, taken as a whole, in each case free and clear of all liens, encumbrances, claims and defects and imperfections
of title except those that (i) do not materially interfere with the use made and proposed to be made of such property by the Company
and its subsidiary or (ii) would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
(v) Intellectual
Property. (i) The Company and its subsidiary possess valid and adequate rights to use all patents, inventions, trademarks, service
marks, trade names, domain names and other source indicators, copyrights and copyrightable works, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) and all other similar worldwide
intellectual property and proprietary rights (including all registrations, applications for registration and goodwill associated with
the foregoing), including all licenses to any of the foregoing (collectively, “Intellectual Property”), in
each case, used in, held for use in or otherwise necessary for the conduct of their respective businesses as currently conducted and
as proposed to be conducted; (ii) the Company’s and its subsidiary’s conduct of their respective businesses has not
infringed, misappropriated or otherwise violated any Intellectual Property of any person, except as would not reasonably be expected
to have a Material Adverse Effect; (iii) neither the Company nor its subsidiary has received any notice of any claim relating to
Intellectual Property, including any claim of infringement, misappropriation or other violation of any Intellectual Property of any person,
or any notice challenging the validity, enforceability or scope of any Intellectual Property of the Company or its subsidiary; and (iv) to
the knowledge of the Company, all Intellectual Property of the Company and its subsidiary is valid, enforceable and has not been infringed,
misappropriated or otherwise violated by any person.
(w) No
Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company or its subsidiary, on the one
hand, and the directors, officers, stockholders, customers or suppliers of the Company or its subsidiary, on the other, that is required
by the Securities Act to be described in each of the Registration Statement and the Prospectus and that is not so described in such documents.
(x) Investment
Company Act. The Company is not and, after giving effect to the offering and sale of the Placement Shares and the application of the
proceeds thereof as described in the Registration Statement and the Prospectus, will not be an “investment company” or an
entity “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended,
and the rules and regulations of the Commission thereunder (collectively, the “Investment Company Act”).
(y) Taxes.
The Company and its subsidiary have paid all federal, state, local and non-U.S. taxes and filed all tax returns required to be paid or
filed through the date hereof, except for taxes being contested in good faith by appropriate proceedings and for which adequate reserves
in accordance with GAAP have been taken and as would not reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect; and except as otherwise disclosed in each of the Registration Statement and the Prospectus, there is no tax deficiency
that has been, or would reasonably be expected to be, asserted against the Company or its subsidiary or any of their respective properties
or assets that would reasonably be expected to have a Material Adverse Effect.
(z) Licenses
and Permits. The Company and its subsidiary possess all licenses, sub-licenses, certificates, permits and other authorizations issued
by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities
that are necessary for the ownership or lease of their respective properties or the conduct of their respective businesses as described
in each of the Registration Statement and the Prospectus, except where the failure to possess or make the same would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect; and except as described in each of the Registration Statement
and the Prospectus, neither the Company nor its subsidiary has received notice of any revocation or modification of any such license,
sub-license, certificate, permit or authorization or has any reason to believe that any such license, sub-license, certificate, permit
or authorization will not be renewed in the ordinary course.
(aa) No
Labor Disputes. No labor disturbance by or dispute with employees of the Company or its subsidiary exists or, to the knowledge of
the Company, is contemplated or threatened, and the Company is not aware of any existing or imminent labor disturbance by, or dispute
with, the employees of any of its or its subsidiary’s principal suppliers, contractors or customers, except as would not reasonably
be expected to have a Material Adverse Effect. Neither the Company nor its subsidiary has received any notice of cancellation or
termination with respect to any collective bargaining agreement to which it is a party.
(bb) Certain
Environmental Matters. (i) The Company and its subsidiary (x) are in compliance with all applicable federal, state, local
and foreign laws (including common law), rules, regulations, requirements, decisions, judgments, decrees, orders and other legally enforceable
requirements relating to pollution or the protection of human health or safety, the environment, natural resources, hazardous or toxic
substances or wastes, pollutants or contaminants (collectively, “Environmental Laws”); (y) have received
and are in compliance with all permits, licenses, certificates or other authorizations or approvals required of them under any Environmental
Laws to conduct their respective businesses; and (z) have not received notice of any actual or potential liability or obligation
under or relating to, or any actual or potential violation of, any Environmental Laws, including for the investigation or remediation
of any disposal or release of hazardous or toxic substances or wastes, pollutants or contaminants, and have no knowledge of any event
or condition that would reasonably be expected to result in any such notice, and (ii) there are no costs or liabilities associated
with Environmental Laws of or relating to the Company or its subsidiary, except in the case of each of (i) and (ii) above, for
any such matter as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and (iii) except
as described in the Prospectus, (x) there is no proceeding that is pending, or, to the Company’s knowledge, contemplated, against
the Company or its subsidiary under any Environmental Laws in which a governmental entity is also a party, other than such proceeding
regarding which it is reasonably believed no monetary sanctions of $100,000 or more will be imposed, (y) the Company and its subsidiary
are not aware of any facts or issues regarding compliance with Environmental Laws, or liabilities or other obligations under Environmental
Laws or concerning hazardous or toxic substances or wastes, pollutants or contaminants, that would reasonably be expected to have a material
effect on the capital expenditures, earnings or competitive position of the Company and its subsidiary, and (z) neither the Company
nor its subsidiary anticipates material capital expenditures relating to any Environmental Laws.
(cc) Hazardous
Materials. There has been no storage, generation, transportation, use, handling, treatment, Release (as defined below) or threat of
Release of Hazardous Materials (as defined below) by, relating to or caused by the Company or to its subsidiary (or, to the knowledge
of the Company and its subsidiary, any other entity (including any predecessor) for whose acts or omissions the Company or its subsidiary
is or would reasonably be expected to be liable) at, on, under or from any property or facility now or, to the knowledge of the Company,
previously owned, operated or leased by the Company or its subsidiary, or at, on, under or from any other property or facility, in violation
of any Environmental Laws or in a manner or amount or to a location that would reasonably be expected to result in any liability under
any Environmental Law, except for any violation or liability which would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. “Hazardous Materials” means any material, chemical, substance, waste,
pollutant, contaminant, compound, mixture, or constituent thereof, in any form or amount, including petroleum (including crude oil or
any fraction thereof) and petroleum products, natural gas liquids, asbestos and asbestos containing materials, naturally occurring radioactive
materials, brine, and drilling mud, regulated or which can give rise to liability under any Environmental Law. “Release”
means any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, or migrating in, into or through the environment, or in, into, from or through any building or structure.
(dd) Compliance
with ERISA. (i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), for which the Company or any member of its
“Controlled Group” (defined as any entity, whether or not incorporated, that is under common control with
the Company within the meaning of Section 4001(a)(14) of ERISA or any entity that would be regarded as a single employer with
the Company under Section 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986, as amended (the
“Code”)) has any liability (each, a “Plan”) has been maintained in compliance
with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to
ERISA and the Code; (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the
Code, has occurred with respect to any Plan, excluding transactions effected pursuant to a statutory or administrative exemption;
(iii) for each Plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no
Plan has failed (whether or not waived), or is reasonably expected to fail, to satisfy the minimum funding standards (within the
meaning of Section 302 of ERISA or Section 412 of the Code) applicable to such Plan; (iv) no Plan is, or is
reasonably expected to be, in “at risk status” (within the meaning of Section 303(i) of ERISA) and no Plan
that is a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA is in “endangered
status” or “critical status” (within the meaning of Sections 304 and 305 of ERISA) (v) the fair market value
of the assets of each Plan that is subject to the funding rules of Section 412 of the Code of Section 302 of ERISA
exceeds the present value of all benefits accrued under such Plan (determined based on those assumptions used to fund such Plan);
(vi) no “reportable event” (within the meaning of Section 4043(c) of ERISA and the regulations
promulgated thereunder) has occurred or is reasonably expected to occur; (vii) each Plan that is intended to be qualified under
Section 401(a) of the Code is covered by a favorable determination letter from the Internal Revenue Service or is entitled
to rely on an opinion letter issued by the Internal Revenue Service, and nothing has occurred, whether by action or by failure to
act, which would reasonably be expected to cause the loss of such qualification; (viii) neither the Company nor any member of
the Controlled Group has incurred, nor reasonably expects to incur, any liability under Title IV of ERISA (other than contributions
to the Plan or premiums to the Pension Benefit Guarantee Corporation, in the ordinary course and without default) in respect of a
Plan (including a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA); and (ix) none
of the following events has occurred or is reasonably likely to occur: (A) a material increase in the aggregate amount of
contributions required to be made to all Plans by the Company or any of its subsidiaries in the current fiscal year of the Company
compared to the amount of such contributions made in the Company’s most recently completed fiscal year; or (B) a material
increase in the Company and its subsidiary’s “accumulated post-retirement benefit obligations” (within the meaning
of Accounting Standards Codification Topic 715-60) compared to the amount of such obligations in the Company and its
subsidiary’s most recently completed fiscal year, except in each case with respect to the events or conditions set forth in
(i) through (ix) hereof, as would not, individually or in the aggregate, have a Material Adverse Effect.
(ee) Disclosure
Controls. The Company and its subsidiary maintain an effective system of “disclosure controls and procedures” (as defined
in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to
ensure that information required to be disclosed by the Company in reports that 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, including controls
and procedures designed to ensure that such information is accumulated and communicated to the Company’s management as appropriate
to allow timely decisions regarding required disclosure.
(ff) Accounting
Controls. The Company and its subsidiary maintain systems of “internal control over financial reporting” (as defined in
Rule 13a-15(f) of the Exchange Act) that have been designed to comply with the requirements of the Exchange Act and have been
designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing
similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with GAAP. The Company and its subsidiary maintain 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. Except as disclosed in the Registration Statement and the Prospectus, there are no material
weaknesses in the Company’s internal controls. The Company’s auditors and the Audit Committee of the Board of Directors
of the Company have been advised of: (i) all significant deficiencies and material weaknesses in the design or operation of
internal controls over financial reporting which have adversely affected or are reasonably likely to adversely affect the Company’s
ability to record, process, summarize and report financial information; and (ii) to the knowledge of the Company, any fraud, whether
or not material, that involves management or other employees who have a significant role in the Company’s internal controls over
financial reporting.
(gg) Insurance.
The Company and its subsidiary have insurance covering their respective properties, operations, personnel and businesses, including business
interruption insurance, which insurance is in amounts and insures against such losses and risks which the Company reasonably believes
are adequate to protect the Company and its subsidiary and their respective businesses, taken as a whole; and neither the Company nor
its subsidiary has (i) received notice from any insurer or agent of such insurer that capital improvements or other expenditures
are required or necessary to be made in order to continue such insurance or (ii) 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 at reasonable cost from similar
insurers as may be necessary to continue its business.
(hh) No
Unlawful Payments. Neither the Company nor its subsidiary nor any director or officer of the Company or its subsidiary nor, to the
knowledge of the Company, any agent, employee, affiliate or other person associated with or acting on behalf of the Company or its subsidiary
has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political
activity; (ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful payment
or benefit to any foreign or domestic government official or employee, including of any government-owned or controlled entity or of a
public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political
party or party official or candidate for political office; (iii) violated or is in violation of any provision of the Foreign Corrupt
Practices Act of 1977, as amended, or any applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign
Public Officials in International Business Transactions, or committed an offence under the Bribery Act 2010 of the United Kingdom or any
other applicable anti-bribery or anti-corruption law; or (iv) made, offered, agreed, requested or taken an act in furtherance of
any unlawful bribe or other unlawful benefit, including, without limitation, any rebate, payoff, influence payment, kickback or other
unlawful or improper payment or benefit. The Company and its subsidiary have instituted, maintain and enforce, and will continue
to maintain and enforce policies and procedures designed to promote and ensure compliance with all applicable anti-bribery and anti-corruption
laws.
(ii) Compliance
with Anti-Money Laundering Laws. The operations of the Company and its subsidiary are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the applicable money laundering statutes of all jurisdictions where the Company or its subsidiary conducts business, the rules and
regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental
agency where the Company conducts business (collectively, the “Anti-Money Laundering Laws”) and no action, suit
or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or its subsidiary
with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(jj) No
Conflicts with Sanctions Laws. Neither the Company nor its subsidiary, directors or officers, nor, to the knowledge of the
Company, any agent, employee, affiliate or other person associated with or acting on behalf of the Company or its subsidiary is
currently the subject or the target of any sanctions administered or enforced by the U.S. government (including, without limitation,
the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State and including, without
limitation, the designation as a “specially designated national” or “blocked person”), the United Nations
Security Council, the European Union, Her Majesty’s Treasury or other relevant sanctions authority (collectively,
“Sanctions”), nor is the Company or its subsidiary located, organized or resident in a country or
territory that is the subject or target of Sanctions, including, without limitation, Cuba, Iran, North Korea, Sudan, Syria and
Crimea (each, a “Sanctioned Country”); and the Company will not directly or indirectly use the proceeds of
the offering of the Placement Shares hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary,
joint venture partner or other person or entity (i) to fund or facilitate any activities of or business with any person that,
at the time of such funding or facilitation, is the subject or target of Sanctions, (ii) to fund or facilitate any activities
of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by any person (including
any person participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions. For the
past five years, the Company and its subsidiary have not knowingly engaged in and are not now knowingly engaged in any dealings or
transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with
any Sanctioned Country.
(kk) No
Reliance. The Company has not relied upon Cowen or legal counsel for Cowen for any legal, tax or accounting advice in connection with
the offering and sale of the Placement Shares.
(ll) No
Restrictions on Subsidiary. The Company’s subsidiary is not currently prohibited, directly or indirectly, under any agreement
or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution
on such subsidiary’s capital stock or similar ownership interest, from repaying to the Company any loans or advances to such subsidiary
from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other subsidiary of the
Company.
(mm) No
Broker’s Fees. Neither the Company nor its subsidiary is a party to any contract, agreement or understanding with any person
(other than this Agreement) that would give rise to a valid claim against either of them or Cowen for a brokerage commission, finder’s
fee or like payment in connection with the offering and sale of the Placement Shares.
(nn) No
Stabilization. The Company has not taken, directly or indirectly, any action designed to or that would reasonably be expected to cause
or result in any stabilization or manipulation of the price of the Placement Shares.
(oo) Margin
Rules. Neither the issuance, sale and delivery of the Placement Shares nor the application of the proceeds thereof by the Company
as described in each of the Registration Statement and the Prospectus will violate Regulation T, U or X of the Board of Governors of the
Federal Reserve System or any other regulation of such Board of Governors.
(pp) Forward-Looking
Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act) included in any of the Registration Statement or the Prospectus has been made or reaffirmed without a reasonable basis or
has been disclosed other than in good faith.
(qq) Statistical
and Market Data. Nothing has come to the attention of the Company that has caused the Company to believe that the statistical and
market-related data included in each of the Registration Statement and the Prospectus is not based on or derived from sources that are
reliable and accurate in all material respects.
(rr) Xxxxxxxx-Xxxxx
Act. There is and has been no failure on the part of the Company or, to the knowledge of the Company, any of the Company’s
directors or officers, in their capacities as such, to comply with any provision of the Xxxxxxxx-Xxxxx Act of 2002, as amended and
the rules and regulations promulgated in connection therewith (the “Xxxxxxxx-Xxxxx Act”), including
Section 402 related to loans.
(ss) No
Ratings. There are (and prior to the Representation Date, will be) no debt securities or preferred stock issued or guaranteed by the
Company or its subsidiary that are rated by a “nationally recognized statistical rating organization,” as such term is defined
under Section 3(a)(62) under the Exchange Act.
(tt) Pre-Clinical
Studies and Clinical Trials. (i) Except as described in the Registration Statement and the Prospectus, the pre-clinical studies
and clinical trials conducted by or, to the knowledge of the Company, on behalf of or sponsored by the Company or its subsidiary or in
which the Company or its subsidiary have participated, that are described in the Registration Statement and the Prospectus, or the results
of which are referred to in the Registration Statement and the Prospectus, as applicable, were, and if still pending are, being conducted
in all material respects in accordance with all applicable statutes and all applicable rules and regulations of the U.S. Food and
Drug Administration and comparable regulatory agencies outside of the United States to which they are subject (collectively, the “Regulatory
Authorities”) and Good Clinical Practices and Good Laboratory Practices, as applicable; (ii) the descriptions in the
Registration Statement and the Prospectus of the results of such studies and trials are accurate and complete descriptions in all material
respects and fairly present the data derived therefrom; (iii) the Company has no knowledge of any other studies or trials not described
in the Registration Statement and the Prospectus, the results of which are inconsistent with or call into question the results described
or referred to in the Registration Statement and the Prospectus; (iv) the Company and its subsidiary have operated at all times
and are currently in compliance in all material respects with all applicable statutes, rules and regulations of the Regulatory Authorities;
and (v) neither the Company nor its subsidiary have received any written communications from the Regulatory Authorities or any other
governmental agency requiring or threatening the termination, material modification or suspension of any pre-clinical studies or clinical
trials that are described in the Registration Statement and the Prospectus or the results of which are referred to in the Registration
Statement and the Prospectus, other than ordinary course written communications with respect to modifications in connection with the design
and implementation of such studies or trials, and, to the Company’s knowledge, there are no reasonable grounds for the same.
(uu) Regulatory
Filings. The Company has not failed to file with the Regulatory Authorities any required filing, declaration, listing, registration,
report or submission with respect to the Company’s product candidates that are described or referred to in the Registration Statement
and the Prospectus; all such filings, declarations, listings, registrations, reports or submissions were in material compliance with applicable
laws when filed; and no deficiencies regarding compliance with applicable law have been asserted by any applicable regulatory authority
with respect to any such filings, declarations, listings, registrations, reports or submissions.
(vv) Privacy
Laws. To the knowledge of the Company, the Company and its subsidiary are in material compliance with all applicable state and
federal data privacy and security laws and regulations, including, without limitation, the Health Insurance Portability and
Accountability Act (“HIPAA”), as amended by the Health Information Technology for Economic and Clinical
Health Act (the “HITECH Act”) (42 U.S.C. Section 17921 et seq.), to the extent each is applicable to
the Company’s business (collectively, the “Privacy Laws”). To the extent required by applicable
Privacy Laws, except as would not otherwise be expected to have a Material Adverse Effect, the Company and its subsidiary have in
place policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling and
analysis of Personal Data (the “Policies”) and take appropriate steps reasonably designed to ensure
compliance in all material respects with such Policies. “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) Protected Health Information as defined by HIPAA; and (iv) any other
piece of information that identifies such natural person, or his or her family, or identifies a specific person’s health
condition or sexual orientation. To the Company’s knowledge, no disclosures made or contained in any of the Policies have been
inaccurate, misleading, deceptive or in violation of any Privacy Laws or Policies in any material respect. Neither the Company nor
its subsidiary, (i) has received notice of any actual or alleged liability under or relating to, or actual or alleged violation
of, any of the Privacy Laws, and has no knowledge of any event or condition that would reasonably be expected to result in any such
notice; (ii) is currently conducting or paying for, in whole or in part, any material investigation, remediation or other
corrective action pursuant to any Privacy Law; or (iii) is a party to any order, decree, or agreement that imposed any
obligation or liability under any Privacy Law.
(ww) IT
Systems. Except as disclosed in the Registration Statement and the Prospectus, (i)(x) to the knowledge of the Company, there
has been no security breach or other compromise of or relating to any of the Company’s or its subsidiary’s information technology
and computer systems, networks, hardware, software, data (including the data of their respective customers, employees, suppliers, vendors
and any third party data maintained by or on behalf of them), equipment or technology (collectively, “IT Systems and Data”)
requiring notice to any third party under applicable state or federal law and (y) the Company and its subsidiary have not been notified
of, and have no knowledge of any event or condition that would reasonably be expected to result in, any security breach or other compromise
to their IT Systems and Data requiring notice to any third party under applicable state or federal law; (ii) the Company and its
subsidiary 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, in the case of this clause (ii), individually or in the aggregate, have a Material Adverse Effect;
and (iii) the Company and its subsidiary have used commercially reasonable efforts to implement backup and disaster recovery technology
consistent with industry standards and practices.
Any certificate signed by an officer of the Company
and delivered to Cowen or to counsel for Cowen shall be deemed to be a representation and warranty by the Company to Cowen as to the matters
set forth therein.
The Company acknowledges that Cowen and, for
purposes of the opinions to be delivered pursuant to Section 7 hereof, counsel to the Company and counsel to Cowen,
will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents to such reliance.
7. Covenants
of the Company. The Company covenants and agrees with Cowen that:
(a) Registration
Statement Amendments. After the date of this Agreement and during any period in which a Prospectus relating to any Placement
Shares is required to be delivered by Cowen under the Securities Act (including in circumstances where such requirement may be
satisfied pursuant to Rule 172 under the Securities Act), (i) the Company will notify Cowen promptly of the time when any
subsequent amendment to the Registration Statement, other than documents incorporated by reference, has been filed with the
Commission and/or has become effective or any subsequent supplement to the Prospectus has been filed and of any request by the
Commission for any amendment or supplement to the Registration Statement or Prospectus or for additional information (insofar as it
relates to the transactions contemplated hereby), (ii) the Company will prepare and file with the Commission, promptly upon
Xxxxx’x reasonable request, any amendments or supplements to the Registration Statement or Prospectus that, in Xxxxx’x
reasonable opinion, may be necessary or advisable in connection with the distribution of the Placement Shares by Cowen (provided,
however, that the failure of Cowen to make such request shall not relieve the Company of any obligation or liability hereunder,
or affect Xxxxx’x right to rely on the representations and warranties made by the Company in this Agreement and provided,
further, that the only remedy Cowen shall have with respect to the failure by the Company to obtain such consent shall be to
cease making sales under this Agreement until such amendment or supplement is filed); (iii) the Company will not file any
amendment or supplement to the Registration Statement or Prospectus, other than documents incorporated by reference, relating to the
Placement Shares or a security convertible into the Placement Shares unless a copy thereof has been submitted to Cowen within a
reasonable period of time before the filing and Cowen has not reasonably objected thereto (provided, however, that the
failure of Cowen to make such objection shall not relieve the Company of any obligation or liability hereunder, or affect
Xxxxx’x right to rely on the representations and warranties made by the Company in this Agreement and provided,
further, that the only remedy Cowen shall have with respect to the failure by the Company to obtain such consent shall be to
cease making sales under this Agreement) and the Company will furnish to Cowen at the time of filing thereof a copy of any document
that upon filing is deemed to be incorporated by reference into the Registration Statement or Prospectus, except for those documents
available via XXXXX; (iv) the Company will cause each amendment or supplement to the Prospectus, other than documents
incorporated by reference, to be filed with the Commission as required pursuant to the applicable paragraph of
Rule 424(b) of the Securities Act; and (v) prior to the termination of this Agreement, the Company will notify Cowen
if at any time the Registration Statement shall no longer be effective as a result of the passage of time pursuant to Rule 415
under the Securities Act or otherwise. The Company shall file a final Prospectus Supplement pursuant to
Rule 424(b) relating to the Placement Shares within two (2) Trading Days of the initial sale of any Placement
Shares.
(b) Notice
of Commission Stop Orders. The Company will advise Cowen, promptly after it receives notice or obtains knowledge thereof, of the issuance
or threatened issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement, of the suspension
of the qualification of the Placement Shares for offering or sale in any jurisdiction, or of the initiation or threatening of any proceeding
for any such purpose; and it will promptly use its commercially reasonable efforts to prevent the issuance of any stop order or to obtain
its withdrawal if such a stop order should be issued.
(c) Delivery
of Prospectus; Subsequent Changes. During any period in which a Prospectus relating to the Placement Shares is required to be delivered
by Xxxxx under the Securities Act with respect to a pending sale of the Placement Shares (including in circumstances where such requirement
may be satisfied pursuant to Rule 172 under the Securities Act), the Company will comply with all requirements imposed upon it by
the Securities Act, as from time to time in force, and to file on or before their respective due dates (taking into account any extensions
available under the Exchange Act) all reports and any definitive proxy or information statements required to be filed by the Company with
the Commission pursuant to Sections 13(a), 13(c), 14, 15(d) or any other provision of or under the Exchange Act. If during such period
any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading,
or if during such period it is necessary to amend or supplement the Registration Statement or Prospectus to comply with the Securities
Act, the Company will promptly notify Cowen to suspend the offering of Placement Shares during such period and the Company will promptly
amend or supplement the Registration Statement or Prospectus (at the expense of the Company) so as to correct such statement or omission
or effect such compliance.
(d) Listing
of Placement Shares. During any period in which the Prospectus relating to the Placement Shares is required to be delivered by Cowen
under the Securities Act with respect to a pending sale of the Placement Shares (including in circumstances where such requirement may
be satisfied pursuant to Rule 172 under the Securities Act), the Company will use its commercially reasonable efforts to cause the
Placement Shares to be listed on Nasdaq and to qualify the Placement Shares for sale under the securities laws of such jurisdictions as
Cowen reasonably designates and to continue such qualifications in effect so long as required for the distribution of the Placement Shares;
provided, however, that the Company shall not be required in connection therewith to qualify as a foreign corporation or dealer
in securities or file a general consent to service of process in any jurisdiction.
(e) Delivery
of Registration Statement and Prospectus. The Company will furnish to Cowen and its counsel (at the expense of the Company) copies
of the Registration Statement, the Prospectus (including all documents incorporated by reference therein) and all amendments and supplements
to the Registration Statement or Prospectus that are filed with the Commission during any period in which a Prospectus relating to the
Placement Shares is required to be delivered under the Securities Act (including all documents filed with the Commission during such period
that are deemed to be incorporated by reference therein), in each case as soon as reasonably practicable and in such quantities as Cowen
may from time to time reasonably request and, at Xxxxx’x request, will also furnish copies of the Prospectus to each exchange or
market on which sales of the Placement Shares may be made; provided, however, that the Company shall not be required to furnish
any document (other than the Prospectus) to Cowen to the extent such document is available on XXXXX.
(f) Earnings
Statement. The Company will make generally available to its security holders as soon as practicable, but in any event not later than
15 months after the end of the Company’s current fiscal quarter, an earnings statement covering a 12-month period that satisfies
the provisions of Section 11(a) and Rule 158 of the Securities Act.
(g) Expenses.
The Company, whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated, in accordance with
the provisions of Section 11 hereunder, will pay the following expenses all incident to the performance of its obligations
hereunder, including, but not limited to, expenses relating to (i) the preparation, printing and filing of the Registration Statement
and each amendment and supplement thereto, of each Prospectus and of each amendment and supplement thereto, (ii) the preparation,
issuance and delivery of the Placement Shares, (iii) the qualification of the Placement Shares under securities laws in accordance
with the provisions of Section 7(d) of this Agreement, including filing fees (provided, however, that any fees
or disbursements of counsel for Cowen in connection therewith shall be paid by Cowen except as set forth in (vii) below), (iv) the
printing and delivery to Cowen of copies of the Prospectus and any amendments or supplements thereto, and of this Agreement, (v) the
fees and expenses incurred in connection with the listing or qualification of the Placement Shares for trading on Nasdaq, (vi) the
filing fees and expenses, if any, of the Commission, (vii) the filing fees and associated legal expenses of Xxxxx’x outside
counsel for filings with the FINRA Corporate Financing Department, such legal expense reimbursement not to exceed $10,000, and (viii) the
reasonable fees and disbursements of Xxxxx’x counsel in an amount not to exceed $50,000.
(h) Use
of Proceeds. The Company will use the Net Proceeds as described in the Prospectus in the section entitled “Use of Proceeds.”
(i) Notice
of Other Sales. During the pendency of any Placement Notice given hereunder, and for 5 trading days following the termination of
any Placement Notice given hereunder, the Company shall provide Cowen notice as promptly as reasonably possible before it offers to
sell, contracts to sell, sells, grants any option to sell or otherwise disposes of any shares of Common Stock (other than Placement
Shares offered pursuant to the provisions of this Agreement) or securities convertible into or exchangeable for Common Stock,
warrants or any rights to purchase or acquire Common Stock; provided, that such notice shall not be required in connection
with (i) the issuance, grant or sale of Common Stock, options to purchase shares of Common Stock or Common Stock issuable upon
the exercise of options or other equity awards pursuant to any stock option, stock bonus or other stock plan or arrangement
described in the Prospectus, (ii) the issuance of securities in connection with an acquisition, merger or sale or purchase of
assets, (iii) the issuance or sale of Common Stock pursuant to any dividend reinvestment plan that the Company may adopt from
time to time provided the implementation of such is disclosed to Cowen in advance, (iv) the issuance or sale of any shares of
common stock issuable upon the exchange, conversion or redemption of securities or the exercise of warrants, options or other rights
in effect or outstanding or (v) the issuance or sale of any shares of common stock, or securities convertible into or
exercisable for common stock, offered and sold in a privately negotiated transaction to vendors, customers, strategic partners or
potential strategic partners conducted in a manner so as not to be integrated with the offering of common stock hereby.
Notwithstanding the foregoing provisions, nothing herein shall be construed to restrict the Company’s ability, or require the
Company to provide notice to Cowen, to file a registration statement under the Securities Act.
(j) Change
of Circumstances. The Company will, at any time during a fiscal quarter in which the Company intends to tender a Placement Notice
or sell Placement Shares, advise Cowen promptly after it shall have received notice or obtained knowledge thereof, of any information
or fact that would alter or affect in any material respect any opinion, certificate, letter or other document provided to Cowen pursuant
to this Agreement.
(k) Due
Diligence Cooperation. The Company will cooperate with any reasonable due diligence review conducted by Cowen or its agents in connection
with the transactions contemplated hereby, including, without limitation, providing information and making available documents and senior
corporate officers, during regular business hours and at the Company’s principal offices, as Cowen may reasonably request.
(l) Required
Filings Relating to Placement of Placement Shares. The Company agrees that on such dates as the Securities Act shall require, the
Company will (i) file a prospectus supplement with the Commission under the applicable paragraph of Rule 424(b) under the
Securities Act (each and every filing under Rule 424(b), a “Filing Date”), which prospectus supplement
will set forth, within the relevant period, the amount of Placement Shares sold through Cowen, the Net Proceeds to the Company and the
compensation payable by the Company to Cowen with respect to such Placement Shares, and (ii) deliver such number of copies of each
such prospectus supplement to each exchange or market on which such sales were effected as may be required by the rules or regulations
of such exchange or market.
(m) Representation
Dates; Certificate. On or prior to the First Delivery Date and each time the Company (i) files the Prospectus relating to the
Placement Shares or amends or supplements the Registration Statement or the Prospectus relating to the Placement Shares (other than a
prospectus supplement filed in accordance with Section 7(l) of this Agreement) by means of a post-effective amendment,
sticker, or supplement but not by means of incorporation of document(s) by reference to the Registration Statement or the Prospectus
relating to the Placement Shares; (ii) files an annual report on Form 10-K under the Exchange Act; (iii) files its quarterly
reports on Form 10-Q under the Exchange Act; or (iv) files a report on Form 8-K containing amended financial information
(other than an earnings release) under the Exchange Act (each date of filing of one or more of the documents referred to in clauses (i) through
(iv) shall be a “Representation Date”); the Company shall furnish Cowen with a certificate, in the form
attached hereto as Exhibit 7(m) within three (3) Trading Days of any Representation Date if requested by
Cowen. The requirement to provide a certificate under this Section 7(m) shall be waived for any Representation
Date occurring at a time at which no Placement Notice is pending, which waiver shall continue until the earlier to occur of the date
the Company delivers a Placement Notice hereunder (which for such calendar quarter shall be considered a Representation Date) and the
next occurring Representation Date; provided, however, that such waiver shall not apply for any Representation Date on
which the Company files its annual report on Form 10-K. Notwithstanding the foregoing, if the Company subsequently decides to sell
Placement Shares following a Representation Date when the Company relied on such waiver and did not provide Cowen with a certificate
under this Section 7(m), then before the Company delivers the Placement Notice or Cowen sells any Placement Shares,
the Company shall provide Cowen with a certificate, in the form attached hereto as Exhibit 7(m), dated the date of
the Placement Notice.
(n) Corporate
Legal Opinion. On or prior to the First Delivery Date and within three (3) Trading Days of each Representation Date with respect
to which the Company is obligated to deliver a certificate in the form attached hereto as Exhibit 7(m) for which
no waiver is applicable, the Company shall cause to be furnished to Cowen a written opinion and negative assurance letter of Xxxxxx Xxxxxx
Xxxxxxxxx Xxxx and Xxxx LLP (collectively with Company IP Counsel (as defined below), the “Company Counsel”),
or other counsel satisfactory to Cowen, in form and substance reasonably satisfactory to Cowen and its counsel, dated the date that the
opinion is required to be delivered, modified, as necessary, to relate to the Registration Statement and the Prospectus as then amended
or supplemented; provided, however, that in lieu of such opinions for subsequent Representation Dates, counsel may furnish Cowen
with a letter (a “Reliance Letter”) to the effect that Cowen may rely on a prior opinion delivered under this
Section 7(n) to the same extent as if it were dated the date of such letter (except that statements in such prior
opinion shall be deemed to relate to the Registration Statement and the Prospectus as amended or supplemented at such Representation
Date).
(o) Intellectual
Property Opinion. On or prior to the First Delivery Date and within three (3) Trading Days of each Representation Date with
respect to which the Company is obligated to deliver a certificate in the form attached hereto as Exhibit 7(m) for
which no waiver is applicable, the Company shall cause to be furnished to Cowen a written opinion and negative assurance letter of Xxxxxx
LLP (“Company IP Counsel”), or other counsel satisfactory to Cowen, in form and substance reasonably satisfactory
to Cowen and its counsel, dated the date that the opinion is required to be delivered, with respect to intellectual property matters,
modified, as necessary, to relate to the Registration Statement and the Prospectus as then amended or supplemented; provided, however,
that in lieu of such opinions for subsequent Representation Dates, counsel may furnish Cowen with a Reliance Letter to the effect
that Cowen may rely on a prior opinion delivered under this Section 7(o) to the same extent as if it were dated
the date of such letter (except that statements in such prior opinion shall be deemed to relate to the Registration Statement and the
Prospectus as amended or supplemented at such Representation Date).
(p) Comfort
Letter. On or prior to the First Delivery Date and within three (3) Trading Days of each Representation Date with respect to
which the Company is obligated to deliver a certificate in the form attached hereto as Exhibit 7(m) for which
no waiver is applicable, the Company shall cause its independent accountants to furnish Cowen letters (the “Comfort Letters”),
dated the date the Comfort Letter is delivered, in form and substance reasonably satisfactory to Cowen, (i) confirming that they
are an independent registered public accounting firm within the meaning of the Securities Act and the PCAOB, (ii) stating, as of
such date, the conclusions and findings of such firm with respect to the financial information and other matters ordinarily covered by
accountants’ “comfort letters” to Cowen in connection with registered public offerings (the first such letter, the
“Initial Comfort Letter”) and (iii) updating the Initial Comfort Letter with any information that would
have been included in the Initial Comfort Letter had it been given on such date and modified as necessary to relate to the Registration
Statement and the Prospectus, as amended and supplemented to the date of such letter.
(q) Market
Activities. The Company will not, directly or indirectly, (i) take any action designed to cause or result in, or that constitutes
or might reasonably be expected to constitute, the stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Placement Shares or (ii) sell, bid for, or purchase the Placement Shares, or pay anyone any compensation
for soliciting purchases of the Placement Shares other than Cowen; provided, however, that the Company may bid for and purchase shares
of its common stock in accordance with Rule 10b-18 under the Exchange Act.
(r) Insurance.
The Company and its subsidiaries shall maintain, or cause to be maintained, insurance in such amounts and covering such risks as is reasonable
and customary for the business for which it is engaged.
(s) Compliance
with Laws. The Company and each of its subsidiaries shall maintain, or cause to be maintained, all material environmental permits,
licenses and other authorizations required by federal, state and local law in order to conduct their businesses as described in the Prospectus,
and the Company and each of its subsidiaries shall conduct their businesses, or cause their businesses to be conducted, in substantial
compliance with such permits, licenses and authorizations and with applicable environmental laws, except where the failure to maintain
or be in compliance with such permits, licenses and authorizations could not reasonably be expected to result in a Material Adverse Change.
(t) Investment
Company Act. The Company will conduct its affairs in such a manner so as to reasonably ensure that neither it nor its subsidiaries
will be or become, at any time prior to the termination of this Agreement, an “investment company,” as such term is defined
in the Investment Company Act, assuming no change in the Commission’s current interpretation as to entities that are not considered
an investment company.
(u) Securities
Act and Exchange Act. The Company will use its best efforts to comply with all requirements imposed upon it by the Securities Act
and the Exchange Act as from time to time in force, so far as necessary to permit the continuance of sales of, or dealings in, the Placement
Shares as contemplated by the provisions hereof and the Prospectus.
(v) No
Offer to Sell. Other than a free writing prospectus (as defined in Rule 405 under the Securities Act) approved in advance by
the Company and Cowen in its capacity as principal or agent hereunder, neither Cowen nor the Company (including its agents and representatives,
other than Cowen in its capacity as such) will make, use, prepare, authorize, approve or refer to any written communication (as defined
in Rule 405 under the Securities Act), required to be filed with the Commission, that constitutes an offer to sell or solicitation
of an offer to buy Common Stock relating to the Placement Shares to be sold by Cowen as principal or agent hereunder.
(w) Xxxxxxxx-Xxxxx
Act. The Company and its subsidiaries will use best efforts to comply with all effective applicable provisions of the Xxxxxxxx-Xxxxx
Act.
8. Conditions
to Xxxxx’x Obligations. The obligations of Cowen hereunder with respect to a Placement will be subject to the continuing accuracy
and completeness of the representations and warranties made by the Company herein, to the due performance by the Company of its obligations
hereunder, to the completion by Cowen of a due diligence review satisfactory to Cowen in its reasonable judgment, and to the continuing
satisfaction (or waiver by Cowen in its sole discretion) of the following additional conditions:
(a) Registration
Statement Effective. The Registration Statement shall be effective and shall be available for (i) all sales of Placement Shares
issued pursuant to all prior Placement Notices and (ii) the sale of all Placement Shares contemplated to be issued by any Placement
Notice.
(b) No
Material Notices. None of the following events shall have occurred and be continuing: (i) receipt by the Company or any of
its subsidiaries of any request for additional information from the Commission or any other federal or state governmental authority
during the period of effectiveness of the Registration Statement, the response to which would require any post-effective amendments
or supplements to the Registration Statement or the Prospectus; (ii) the issuance by the Commission or any other federal or
state governmental authority of any stop order suspending the effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose; (iii) receipt by the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Placement Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; or (iv) the occurrence of any event that makes any material statement made in
the Registration Statement or the Prospectus or any material document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or that requires the making of any changes in the Registration Statement, related Prospectus or such
documents so that, in the case of the Registration Statement, it will not contain any materially untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading and,
that in the case of the Prospectus, it will not contain any materially untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(c) No
Misstatement or Material Omission. Cowen shall not have advised the Company that the Registration Statement or Prospectus, or any
amendment or supplement thereto, contains an untrue statement of fact that in Xxxxx’x reasonable opinion is material, or omits to
state a fact that in Xxxxx’x opinion is material and is required to be stated therein or is necessary to make the statements therein
not misleading.
(d) Material
Changes. Except as contemplated in the Prospectus, or disclosed in the Company’s reports filed with the Commission, there shall
not have been any material adverse change, on a consolidated basis, in the authorized capital stock of the Company or any Material Adverse
Change or any development that could reasonably be expected to result in a Material Adverse Change, or any downgrading in or withdrawal
of the rating assigned to any of the Company’s securities (other than asset backed securities) by any rating organization or a public
announcement by any rating organization that it has under surveillance or review its rating of any of the Company’s securities (other
than asset backed securities), the effect of which, in the case of any such action by a rating organization described above, in the reasonable
judgment of Cowen (without relieving the Company of any obligation or liability it may otherwise have), is so material as to make it impracticable
or inadvisable to proceed with the offering of the Placement Shares on the terms and in the manner contemplated in the Prospectus.
(e) Company
Counsel Legal Opinions. Cowen shall have received the opinions of Company Counsel required to be delivered pursuant to Section 7(n) and
Section 7(o) on or before the date on which such delivery of such opinion is required pursuant to Section 7(n) and
Section 7(o).
(f) Cowen
Counsel Legal Opinion. Cowen shall have received from Xxxxx, Xxxxx, Xxxx, Xxxxxx, Xxxxxxx and Xxxxx, P.C., counsel for Cowen, such
opinion or opinions, on or before the date on which the delivery of the Company Counsel legal opinions are required pursuant to Section 7(n) and
Section 7(o), with respect to such matters as Cowen may reasonably require, and the Company shall have furnished to
such counsel such documents as they reasonably request for enabling them to pass upon such matters.
(g) Comfort
Letter. Cowen shall have received the Comfort Letter required to be delivered pursuant to Section 7(p) on
or before the date on which such delivery of such Comfort Letter is required pursuant to Section 7(p).
(h) Representation
Certificate. Cowen shall have received the certificate required to be delivered pursuant to Section 7(m) on
or before the date on which delivery of such certificate is required pursuant to Section 7(m).
(i) Secretary’s
Certificate. On or prior to the First Delivery Date, Cowen shall have received a certificate, signed on behalf of the Company by its
corporate Secretary, in form and substance reasonably satisfactory to Cowen and its counsel.
(j) No
Suspension. Trading in the Common Stock shall not have been suspended on Nasdaq.
(k) Other
Materials. On each date on which the Company is required to deliver a certificate pursuant to Section 7(m), the
Company shall have furnished to Cowen such appropriate further information, certificates and documents as Cowen may have reasonably requested.
All such opinions, certificates, letters and other documents shall have been in compliance with the provisions hereof. The Company will
furnish Cowen with such conformed copies of such opinions, certificates, letters and other documents as Cowen shall have reasonably requested.
(l) Securities
Act Filings Made. All filings with the Commission required by Rule 424 under the Securities Act to have been filed prior to the
issuance of any Placement Notice hereunder shall have been made within the applicable time period prescribed for such filing by Rule 424.
(m) Approval
for Listing. The Placement Shares shall either have been (i) approved for listing on Nasdaq, subject only to notice of issuance,
or (ii) the Company shall have filed an application for listing of the Placement Shares on Nasdaq at, or prior to, the issuance of
any Placement Notice.
(n) No
Termination Event. There shall not have occurred any event that would permit Cowen to terminate this Agreement pursuant to Section 11(a).
9. Indemnification
and Contribution.
(a) Company
Indemnification. The Company agrees to indemnify and hold harmless Cowen, the directors, officers, partners, employees and agents
of Cowen and each person, if any, who (i) controls Cowen within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, or (ii) is controlled by or is under common control with Cowen (a “Cowen Affiliate”)
from and against any and all losses, claims, liabilities, expenses and damages (including, but not limited to, any and all reasonable
investigative, legal and other expenses incurred in connection with, and any and all amounts paid in settlement (in accordance with Section 9(c))
of, any action, suit or proceeding between any of the indemnified parties and any indemnifying parties or between any indemnified party
and any third party, or otherwise, or any claim asserted), as and when incurred, to which Cowen, or any such person, may become subject
under the Securities Act, the Exchange Act or other federal or state statutory law or regulation, at common law or otherwise, insofar
as such losses, claims, liabilities, expenses or damages arise out of or are based, directly or indirectly, on (x) any untrue statement
or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment or supplement thereto) or any
omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements
therein, not misleading, or (y) any untrue statement or alleged untrue statement of a material fact contained in the Prospectus
(or any amendment or supplement thereto) or “issuer free writing prospectus,” as defined in Rule 433 of the Securities
Act regulations, or any omission or alleged omission to state therein a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading; provided, however, that this indemnity agreement
shall not apply to the extent that such loss, claim, liability, expense or damage arises from the sale of the Placement Shares pursuant
to this Agreement and is caused directly or indirectly by an untrue statement or omission made in reliance upon and in conformity with
the Agent’s Information. This indemnity agreement will be in addition to any liability that the Company might otherwise have.
(b) Cowen
Indemnification. Cowen agrees to indemnify and hold harmless the Company and its directors and each officer of the Company that signed
the Registration Statement, and each person, if any, who (i) controls the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act or (ii) is controlled by or is under common control with the Company (a “Company
Affiliate”) against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 9(a),
as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendments thereto) or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with
the Agent’s Information.
(c) Procedure.
Any party that proposes to assert the right to be indemnified under this Section 9 will, promptly after receipt of
notice of commencement of any action against such party in respect of which a claim is to be made against an indemnifying party or parties
under this Section 9, notify each such indemnifying party in writing of the commencement of such action, enclosing
a copy of all papers served, but the omission to so notify such indemnifying party will not relieve the indemnifying party from (i) any
liability that it might have to any indemnified party otherwise than under this Section 9 and (ii) any liability
that it may have to any indemnified party under the foregoing provision of this Section 9 unless, and only to the
extent that, such omission results in the forfeiture of substantive rights or defenses by the indemnifying party. If any such action
is brought against any indemnified party and it notifies the indemnifying party of its commencement, the indemnifying party will be entitled
to participate in and, to the extent that it elects by delivering written notice to the indemnified party promptly after receiving notice
of the commencement of the action from the indemnified party, jointly with any other indemnifying party similarly notified, to assume
the defense of the action, with counsel reasonably satisfactory to the indemnified party, and after notice from the indemnifying party
to the indemnified party of its election to assume the defense, the indemnifying party will not be liable to the indemnified party for
any legal or other expenses except as provided below and except for the reasonable costs of investigation subsequently incurred by the
indemnified party in connection with the defense. The indemnified party will have the right to employ its own counsel in any such action,
but the fees, expenses and other charges of such counsel will be at the expense of such indemnified party unless (1) the employment
of counsel by the indemnified party has been authorized in writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based on advice of counsel) that there may be legal defenses available to it or other indemnified parties that are different
from or in addition to those available to the indemnifying party, (3) a conflict or potential conflict exists (based on advice of
counsel to the indemnified party) between the indemnified party and the indemnifying party (in which case the indemnifying party will
not have the right to direct the defense of such action on behalf of the indemnified party) or (4) the indemnifying party has not
in fact employed counsel to assume the defense of such action within a reasonable time after receiving notice of the commencement of
the action, in each of which cases the reasonable fees, disbursements and other charges of counsel will be at the expense of the indemnifying
party or parties. It is understood that the indemnifying party or parties shall not, in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for the reasonable fees, disbursements and other charges of more than one separate firm admitted
to practice in such jurisdiction at any one time for all such indemnified party or parties. All such fees, disbursements and other charges
will be reimbursed by the indemnifying party promptly as they are incurred. An indemnifying party will not, in any event, be liable for
any settlement of any action or claim effected without its written consent. No indemnifying party shall, without the prior written consent
of each indemnified party, settle or compromise or consent to the entry of any judgment in any pending or threatened claim, action or
proceeding relating to the matters contemplated by this Section 9 (whether or not any indemnified party is a party
thereto), unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability
arising or that may arise out of such claim, action or proceeding.
(d) Contribution.
In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in the foregoing paragraphs
of this Section 9 is applicable in accordance with its terms but for any reason is held to be unavailable from the
Company or Cowen, the Company and Cowen will contribute to the total losses, claims, liabilities, expenses and damages (including any
investigative, legal and other expenses reasonably incurred in connection with, and any amount paid in settlement of, any action, suit
or proceeding or any claim asserted, but after deducting any contribution received by the Company from persons other than Cowen, such
as persons who control the Company within the meaning of the Securities Act, officers of the Company who signed the Registration Statement
and directors of the Company, who also may be liable for contribution) to which the Company and Cowen may be subject in such proportion
as shall be appropriate to reflect the relative benefits received by the Company on the one hand and Cowen on the other. The relative
benefits received by the Company on the one hand and Cowen on the other hand shall be deemed to be in the same proportion as the total
Net Proceeds from the sale of the Placement Shares (before deducting expenses) received by the Company bear to the total compensation
received by Cowen from the sale of Placement Shares on behalf of the Company. If, but only if, the allocation provided by the foregoing
sentence is not permitted by applicable law, the allocation of contribution shall be made in such proportion as is appropriate to reflect
not only the relative benefits referred to in the foregoing sentence but also the relative fault of the Company, on the one hand, and
Cowen, on the other, with respect to the statements or omission that resulted in such loss, claim, liability, expense or damage, or action
in respect thereof, as well as any other relevant equitable considerations with respect to such offering. Such relative fault shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company or Cowen, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and Cowen agree that it
would not be just and equitable if contributions pursuant to this Section 9(d) were to be determined by pro rata
allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim, liability, expense, or damage, or action in respect thereof,
referred to above in this Section 9(d) shall be deemed to include, for the purpose of this Section 9(d),
any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action
or claim to the extent consistent with Section 9(c) hereof. Notwithstanding the foregoing provisions of this
Section 9(d), Cowen shall not be required to contribute any amount in excess of the commissions received by it under
this Agreement and no person found guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities
Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 9(d),
any person who controls a party to this Agreement within the meaning of the Securities Act, and any officers, directors, partners, employees
or agents of Cowen, will have the same rights to contribution as that party, and each officer of the Company who signed the Registration
Statement will have the same rights to contribution as the Company, subject in each case to the provisions hereof. Any party entitled
to contribution, promptly after receipt of notice of commencement of any action against such party in respect of which a claim for contribution
may be made under this Section 9(d), will notify any such party or parties from whom contribution may be sought, but
the omission to so notify will not relieve that party or parties from whom contribution may be sought from any other obligation it or
they may have under this Section 9(d) except to the extent that the failure to so notify such other party materially
prejudiced the substantive rights or defenses of the party from whom contribution is sought. Except for a settlement entered into pursuant
to the last sentence of Section 9(c) hereof, no party will be liable for contribution with respect to any action
or claim settled without its written consent if such consent is required pursuant to Section 9(c) hereof.
10. Representations
and Agreements to Survive Delivery. The indemnity and contribution agreements contained in Section 9 of this Agreement
and all representations and warranties of the Company herein or in certificates delivered pursuant hereto shall survive, as of their respective
dates, regardless of (i) any investigation made by or on behalf of Cowen, any controlling persons, or the Company (or any of their
respective officers, directors or controlling persons), (ii) delivery and acceptance of the Placement Shares and payment therefor
or (iii) any termination of this Agreement.
11. Termination.
(a) Cowen
shall have the right by giving notice as hereinafter specified at any time to terminate this Agreement if (i) any Material Adverse
Change, or any development that could reasonably be expected to result in a Material Adverse Change has occurred that, in the reasonable
judgment of Cowen, may materially impair the ability of Cowen to sell the Placement Shares hereunder, (ii) the Company shall have
failed, refused or been unable to perform any agreement on its part to be performed hereunder; provided, however, in the case
of any failure of the Company to deliver (or cause another person to deliver) any certification, opinion, or letter required under Sections
7(m), 7(n), 7(o), or 7(p), Xxxxx’x right to terminate shall not arise unless
such failure to deliver (or cause to be delivered) continues for more than thirty (30) days from the date such delivery was required;
or (iii) any other condition of Xxxxx’x obligations hereunder is not fulfilled, or (iv), any suspension or limitation of trading
in the Placement Shares or in securities generally on Nasdaq shall have occurred. Any such termination shall be without liability of
any party to any other party except that the provisions of Section 7(g) (Expenses), Section 9
(Indemnification and Contribution), Section 10 (Representations and Agreements to Survive Delivery),
Section 16 (Applicable Law; Consent to Jurisdiction) and Section 17 (Waiver
of Jury Trial) hereof shall remain in full force and effect notwithstanding such termination. If Cowen elects to terminate this
Agreement as provided in this Section 11(a), Cowen shall provide the required notice as specified in Section 12 (Notices).
(b) The
Company shall have the right, by giving ten (10) days notice as hereinafter specified to terminate this Agreement in its sole discretion
at any time after the date of this Agreement. Any such termination shall be without liability of any party to any other party except
that the provisions of Section 7(g), Section 9, Section 10, Section 16
and Section 17 hereof shall remain in full force and effect notwithstanding such termination.
(c) Cowen
shall have the right, by giving ten (10) days notice as hereinafter specified to terminate this Agreement in its sole discretion
at any time after the date of this Agreement. Any such termination shall be without liability of any party to any other party except
that the provisions of Section 7(g), Section 9, Section 10, Section 16
and Section 17 hereof shall remain in full force and effect notwithstanding such termination.
(d) Unless
earlier terminated pursuant to this Section 11, this Agreement shall automatically terminate upon the issuance and
sale of all of the Placement Shares through Cowen on the terms and subject to the conditions set forth herein; provided that the
provisions of Section 7(g), Section 9, Section 10, Section 16
and Section 17 hereof shall remain in full force and effect notwithstanding such termination.
(e) This
Agreement shall remain in full force and effect unless terminated pursuant to Sections 11(a), (b), (c),
or (d) above or otherwise by mutual agreement of the parties; provided, however, that any such termination
by mutual agreement shall in all cases be deemed to provide that Section 7(g), Section 9, Section 10,
Section 16 and Section 17 shall remain in full force and effect.
(f) Any
termination of this Agreement shall be effective on the date specified in such notice of termination; provided, however, that
such termination shall not be effective until the close of business on the date of receipt of such notice by Cowen or the Company,
as the case may be. If such termination shall occur prior to the Settlement Date for any sale of Placement Shares, such Placement
Shares shall settle in accordance with the provisions of this Agreement.
(g) Subject
to the additional limitation set forth in Section 7 of this Agreement, in the event of termination of this Agreement
prior to the sale of any Placement Shares, Cowen shall be entitled only to reimbursement of its out-of-pocket expenses actually incurred;
provided that in the event of termination of this Agreement pursuant to Section 11(c), Cowen shall not be entitled
to any reimbursement of its out-of-pocket expenses that have not already been reimbursed prior to such termination pursuant to Section 11(c).
12. Notices.
All notices or other communications required or permitted to be given by any party to any other party pursuant to the terms of this Agreement
shall be in writing, unless otherwise specified in this Agreement, and if sent to Cowen, shall be delivered to Cowen at Xxxxx and Company,
LLC, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000, fax no. 000-000-0000, Attention: General Counsel; or if sent to the Company, shall be delivered
to Mersana Therapeutics, Inc., 000 Xxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000, fax no. 000-000-0000, attention: Legal Department, e-mail:
xxxxx@xxxxxxx.xxx, with a copy to Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: Xxxxx Xxxxx,
e-mail: xxxxx.xxxxx@xxxxxxxxxx.xxx. Each party to this Agreement may change such address for notices by sending to the parties to this
Agreement written notice of a new address for such purpose. Each such notice or other communication shall be deemed given (i) when
delivered personally or by verifiable facsimile transmission (with an original to follow) on or before 4:30 p.m., New York City time,
on a Business Day (as defined below), or, if such day is not a Business Day on the next succeeding Business Day, (ii) on the next
Business Day after timely delivery to a nationally-recognized overnight courier and (iii) on the Business Day actually received if
deposited in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid). For purposes of this Agreement,
“Business Day” shall mean any day on which the Nasdaq and commercial banks in the City of New York are open
for business.
13. Successors
and Assigns. This Agreement shall inure to the benefit of and be binding upon the Company and Cowen and their respective successors
and the affiliates, controlling persons, officers and directors referred to in Section 9 hereof. References to any
of the parties contained in this Agreement shall be deemed to include the successors and permitted assigns of such party. Nothing in
this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors
and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement. Neither party may assign its rights or obligations under this Agreement without the prior written consent of the other
party; provided, however, that Cowen may assign its rights and obligations hereunder to an affiliate of Cowen without obtaining
the Company’s consent.
14. Adjustments
for Share Splits. The parties acknowledge and agree that all share-related numbers contained in this Agreement shall be adjusted to
take into account any share split, share dividend or similar event effected with respect to the Common Stock.
15. Entire
Agreement; Amendment; Severability. This Agreement (including all schedules and exhibits attached hereto and Placement Notices
issued pursuant hereto) constitutes the entire agreement and supersedes all other prior and contemporaneous agreements and
undertakings, both written and oral, among the parties hereto with regard to the subject matter hereof. Neither this Agreement nor
any term hereof may be amended except pursuant to a written instrument executed by the Company and Cowen. In the event that any one
or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or
unenforceable as written by a court of competent jurisdiction, then such provision shall be given full force and effect to the
fullest possible extent that it is valid, legal and enforceable, and the remainder of the terms and provisions herein shall be
construed as if such invalid, illegal or unenforceable term or provision was not contained herein, but only to the extent that
giving effect to such provision and the remainder of the terms and provisions hereof shall be in accordance with the intent of the
parties as reflected in this Agreement.
16. Applicable
Law; Consent to Jurisdiction. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State
of New York without regard to the principles of conflicts of laws. Each party hereby irrevocably submits to the non-exclusive jurisdiction
of the state and federal courts sitting in the City of New York, borough of Manhattan, for the adjudication of any dispute hereunder or
in connection with any transaction contemplated hereby, and hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof (certified
or registered mail, return receipt requested) to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
17. Waiver
of Jury Trial. The Company and Cowen each hereby irrevocably waives any right it may have to a trial by jury in respect of any claim
based upon or arising out of this Agreement or any transaction contemplated hereby.
18. Absence
of Fiduciary Relationship. The Company acknowledges and agrees that:
(a) Cowen
has been retained solely to act as sales agent in connection with the sale of the Common Stock and that no fiduciary, advisory or agency
relationship between the Company and Cowen has been created in respect of any of the transactions contemplated by this Agreement, irrespective
of whether Cowen has advised or is advising the Company on other matters;
(b) the
Company is capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated
by this Agreement;
(c) the
Company has been advised that Cowen and its affiliates are engaged in a broad range of transactions which may involve interests that differ
from those of the Company and that Cowen has no obligation to disclose such interests and transactions to the Company by virtue of any
fiduciary, advisory or agency relationship; and
(d) the
Company waives, to the fullest extent permitted by law, any claims it may have against Cowen, for breach of fiduciary duty or alleged
breach of fiduciary duty and agrees that Cowen shall have no liability (whether direct or indirect) to the Company in respect of such
a fiduciary claim or to any person asserting a fiduciary duty claim on behalf of or in right of the Company, including stockholders, partners,
employees or creditors of the Company.
19. Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. Delivery of an executed Agreement by one party to the other may be made by facsimile or electronic
transmission.
20. Definitions.
As used in this Agreement, the following term has the meaning set forth below:
(a) “Applicable
Time” means the date of this Agreement, each Representation Date, the date on which a Placement Notice is given, and any date
on which Placement Shares are sold hereunder.
(b) “Agent’s
Information” means, solely the following information in the Prospectus: the first and third sentences in the eighth paragraph
under the caption “Plan of Distribution” in the Prospectus.
[Remainder of Page Intentionally Blank]
If the foregoing correctly
sets forth the understanding between the Company and Cowen, please so indicate in the space provided below for that purpose, whereupon
this letter shall constitute a binding agreement between the Company and Cowen.
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Very truly yours, |
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XXXXX AND COMPANY, LLC |
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By: |
/s/ Xxxxxxx Xxxxxx |
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Name: Xxxxxxx Xxxxxx |
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Title: Managing Director |
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ACCEPTED
as of the date first- above written: |
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MERSANA THERAPEUTICS, INC. |
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By: |
/s/ Xxxxx XxXxxxxxxxx |
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Name: Xxxxx XxXxxxxxxxx |
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Title: Senior Vice President and Chief Financial Officer |
SCHEDULE 1
form
of PLACEMENT NOTICE
| From: | [ ____________________ ] |
| Cc: | [ ____________________ ] |
| To: | [ ____________________ ] |
| Subject: | Cowen at the Market Offering—Placement Notice |
Gentlemen:
Pursuant to the terms and subject to the conditions
contained in the Sales Agreement between Mersana Therapeutics, Inc. (the “Company”), and Xxxxx and Company, LLC
(“Cowen”) dated February 28, 2022 (the “Agreement”), I hereby request on behalf of the
Company that Cowen sell up to [ ] shares of the Company’s common stock, par value $0.0001 per share, at a minimum market price of
$_______ per share. Sales should begin on the date of this Notice and shall continue until [DATE] [all shares are sold].
SCHEDULE 2
Mersana Therapeutics, Inc.
Xxxx Xxxxxxxxxx, President and Chief Executive Officer
Xxxxx XxXxxxxxxxx, Senior Vice President, Chief Financial Officer
Xxxxx and Company, LLC
Xxxxxxx Xxxxxx, Managing Director, Equity Capital Markets
Xxxxxx Xxxxxx, Director, Equity Capital Markets
SCHEDULE 3
Compensation
Cowen shall be paid compensation up to 3.0% of
the gross proceeds from the sales of Placement Shares pursuant to the terms of this Agreement.
SCHEDULE 4
Schedule of Subsidiaries
Mersana Securities Corp.
Exhibit 7(m)
OFFICER CERTIFICATE
The undersigned, the duly qualified and elected
_______________________, of Mersana Therapeutics, Inc. (“Company”), a Delaware corporation, does hereby
certify in such capacity and on behalf of the Company, pursuant to Section 7(m) of the Sales Agreement dated February 28,
2022 (the “Sales Agreement”) between the Company and Xxxxx and Company, LLC, that to the best of the knowledge
of the undersigned (capitalized terms used but not defined herein shall have the meanings ascribed to them in the Sales Agreement):
(i) The
representations and warranties of the Company in Section 6 of the Sales Agreement (A) to the extent such representations
and warranties are subject to qualifications and exceptions contained therein relating to materiality or Material Adverse Change, are
true and correct on and as of the date hereof with the same force and effect as if expressly made on and as of the date hereof, except
for those representations and warranties that speak solely as of a specific date and which were true and correct as of such date, and
(B) to the extent such representations and warranties are not subject to any qualifications or exceptions, are true and correct in
all material respects as of the date hereof as if made on and as of the date hereof with the same force and effect as if expressly made
on and as of the date hereof except for those representations and warranties that speak solely as of a specific date and which were true
and correct as of such date; and
(ii) The
Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied pursuant to the Sales Agreement
at or prior to the date hereof.
