VistaGen Therapeutics, Inc. 1,371,430 Shares of Common Stock Series A1 Warrants to Purchase up to 1,388,931 Shares of Common Stock and Series A2 Warrants to Purchase up to 503,641 Shares of Common Stock UNDERWRITING AGREEMENT
Exhibit
1.1
1,371,430
Shares of Common Stock
Series
A1 Warrants to Purchase up to 1,388,931 Shares of Common
Stock
and
Series
A2 Warrants to Purchase up to 503,641 Shares of Common
Stock
August
31, 2017
Xxxxxxxxxxx &
Co. Inc.
00
Xxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Ladies
and Gentlemen:
VistaGen
Therapeutics, Inc., a Nevada corporation (the "Company") proposes,
subject to the terms and conditions contained herein, to sell to
you (the "Underwriter"), an aggregate of (i) 1,371,430 shares (the
"Shares") of the Company's common stock, $0.001 par value per share
(the "Common Stock"), (ii) Series A1 warrants (the “Series A1
Warrants”) to purchase up to an aggregate of 1,388,931 shares
of Common Stock (the “Series A1 Warrant Shares”) and
(iii) Series A2 warrants (the “Series A2 Warrants”, and
collectively, with the Series A1 Warrants, the
“Warrants”) to purchase an aggregate of 503,641 shares
of Common Stock (the “Series A2 Warrant Shares,” and
collectively, with the Series A1 Warrant Shares, the “Warrant
Shares”). Each Share is being sold together with 1.0128
Series A1 Warrants, each whole Series A1 Warrant to purchase one
Series A1 Warrant Share, and 0.3672 of a Series A2 Warrant, each
Whole Series A2 Warrant to purchase one Series A2 Warrant Share.
The Shares, the Warrants and the Warrant Shares are collectively
referred to as the “Securities”. The Shares and the
Warrants will be issued separately, but will be purchased together
in the offering.
The Company has prepared and filed in conformity
with the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), and the published rules and regulations
thereunder (the "Rules") adopted by the Securities and Exchange
Commission (the "Commission") a registration statement on
Form S-3 (No. 333-215671), including a related
prospectus dated July 27, 2017 (the "Base Prospectus") relating to common stock,
preferred stock, debt securities, warrants and units of the Company
that may be sold from time to time by the Company in accordance
with Rule 415 of the Securities Act, and such amendments
thereof as may have been required to the date of this Agreement.
The Registration Statement is effective and available for the
offering and sale of the Securities as contemplated by this
Agreement. Copies of such Registration Statement (including all
amendments thereof and all documents deemed incorporated by
reference therein) and of the related Base Prospectus have
heretofore been delivered by the Company or are otherwise available
to you.
The term "Registration Statement" as used in this
Agreement means the registration statement, including all exhibits,
financial schedules and all documents and information deemed to be
part of the Registration Statement by incorporation by reference or
otherwise, as amended from time to time, including the
information (if any) contained in the form of final prospectus
filed with the Commission pursuant to Rule 424(b) of the Rules and
deemed to be part thereof at the time of effectiveness pursuant to
Rule 430B of the Rules.
-1-
If the
Company has filed an abbreviated registration statement to register
additional Shares and Warrants pursuant to Rule 462(b) under the
Rules (the "462(b) Registration Statement"), then any reference
herein to the Registration Statement shall also be deemed to
include such 462(b) Registration Statement. The term "Preliminary Prospectus" means the Base
Prospectus, together with any preliminary prospectus supplement
used or filed with the Commission pursuant to Rule 424 of the
Rules, in the form provided to the Underwriter by the
Company for use in connection with the offering of the Securities.
The term "Prospectus" means the Base Prospectus,
any Preliminary Prospectus and any amendments or further
supplements to such prospectus, and including, without limitation,
the final prospectus supplement, filed pursuant to and within the
limits described in Rule 424(b) with the Commission in connection
with the proposed sale of the Securities contemplated by this
Agreement through the date of such Prospectus Supplement. The term
"Effective Date" shall mean each date that the Registration
Statement and any post-effective amendment or amendments thereto
became or becomes effective, including as provided in Section 11(d)
of the Securities Act. Unless otherwise stated herein, any
reference herein to the Registration Statement, any Preliminary
Prospectus, the Statutory Prospectus (as hereinafter defined) and
the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein, including pursuant to
Item 12 of Form S-3 under the Securities Act, which were filed
under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") on or before the date hereof or are so filed
hereafter. Any reference herein to the terms "amend," "amendment"
or "supplement" with respect to the Registration Statement, any
Preliminary Prospectus, the Statutory Prospectus or the Prospectus
shall be deemed to refer to and include any such document filed or
to be filed under the Exchange Act after the date of the
Registration Statement, any such Preliminary Prospectus, the
Statutory Prospectus or Prospectus, as the case may be, and deemed
to be incorporated therein by reference.
The Company
understands that the Underwriter proposes to make a public offering
of the Shares and the Warrants, as set forth in and pursuant to the
Statutory Prospectus (as hereinafter defined) and the Prospectus,
as soon after the Effective Date and the date of this Agreement as
the Underwriter deems advisable. The Company hereby confirms that
the Underwriter and dealers have been authorized to distribute or
cause to be distributed each Preliminary Prospectus, and each
Issuer Free Writing Prospectus (as hereinafter defined) and are
authorized to distribute the Prospectus (as from time to time
amended or supplemented if the Company furnishes amendments or
supplements thereto to the Underwriter).
1. Sale, Purchase, Delivery and Payment
for the Shares and the Warrants. On the basis of the
representations, warranties and agreements contained in, and
subject to the terms and conditions of, this
Agreement:
(a) The
Company agrees to issue and sell to the Underwriter, and the
Underwriter agrees to purchase from the Company, at a purchase
price of $1.6275 per Share and related Warrants, (i) the number of
Shares set forth opposite the name of the Underwriter under the
column "Number of Shares to be Purchased" on Schedule I to this
Agreement, (ii) the number of Series A1 Warrants set forth opposite
the name of the Underwriter under the column “Number of
Series A1 Warrants to be Purchased” on Schedule I to this
Agreement and (iii) the number of Series A2 Warrants set forth
opposite the name of the Underwriter under the column “Number
of Series A2 Warrants to be Purchased” on Schedule I to this
Agreement.
(b)
Payment of the purchase price for, and delivery of certificates
for, the Shares and the Warrants shall be made at the offices of
Xxxxxxxxxxx & Co. Inc., 00 Xxxxx
Xxxxxx, 00xx
Xxxxx Xxx Xxxx, Xxx Xxxx 00000,
at 10:00 a.m., New York City time, on the third business day
following the date of this Agreement or at such time on such other
date, not later than ten (10) business days after the date of this
Agreement, as shall be agreed upon by the Company and the
Underwriter (such time and date of delivery and payment are called
the "Closing Date").
(c)
Payment shall be made to the Company by wire transfer of
immediately available funds or by certified or official bank check
or checks payable in New York Clearing House (same day) funds drawn
to the order of the Company, against delivery of certificates
representing the Shares and the Warrants to the
Underwriter.
(d)
Certificates evidencing the Shares and the Warrants shall be
registered in such names and shall be in such denominations as the
Underwriter shall request at least two full business days before
the Closing Date and shall be delivered by or on behalf of the
Company (i) in the case of the Shares, to the Underwriter through
the facilities of the Depository Trust Company ("DTC") for the
account of the Underwriter and (ii) in the case of the Warrants, by
physical delivery to be received or directed by the Underwriter no
later than one (1) business day following the Closing Date. The
Company will cause the certificates representing the Warrants to be
made available for checking and packaging, at such place as is
designated by the Underwriter, on the full business day before the
Closing Date.
-2-
2. Representations and Warranties of the
Company. The Company represents and warrants to the
Underwriter as of the date hereof and as of the Closing Date, as
follows:
(a)
The Company meets the requirements for use of Form S-3 under the
Securities Act including the transaction requirements set forth in
General Instruction 1.B.6 of such form. The aggregate market value
of all securities sold by or on behalf of the Company pursuant to
Form S-3 during the period of 12 calendar months immediately prior
to, and including, the offering contemplated hereby is no more than
one-third of the aggregate market value of the voting and
non-voting common equity held by non-affiliates of the Company
(calculated as provided in General Instruction 1.B.6 of Form S-3).
The Company is not, and has not been for at least 12 calendar
months prior to the filing of the Registration Statement, a shell
company. The Company filed with the Commission the Registration
Statement on such Form, including a Base Prospectus, for
registration under the Securities Act of the offering and sale of
the Securities, and the Company has prepared and used a Preliminary
Prospectus in connection with the offer and sale of the Securities.
When the Registration Statement or any amendment thereof or
supplement thereto was or is declared effective and as of the date
of the most recent amendment to the Registration Statement it (i)
complied or will comply, in all material respects, with the
requirements of the Securities Act and the Rules and the Exchange
Act and the rules and regulations of the Commission thereunder and
(ii) did not or will not, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein
not misleading. When any Preliminary Prospectus or Prospectus was first filed with
the Commission (whether filed as part of the Registration Statement
or any amendment thereto or pursuant to Rule 424 of the Rules) and
when any amendment thereof or supplement thereto was first filed
with the Commission, such Preliminary Prospectus or Prospectus as
amended or supplemented complied in all material respects with the
applicable provisions of the Securities Act and the Rules and did
not or will not, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. If
applicable, each Preliminary Prospectus and the Prospectus
delivered to the Underwriter for use in connection with this
offering was identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the
extent permitted by Regulation S-T. Notwithstanding the
foregoing, none of the representations and warranties in this
paragraph 2(a) shall apply to statements in, or omissions from, the
Registration Statement, any Preliminary Prospectus or the
Prospectus made in reliance upon, and in conformity with,
information herein or otherwise furnished in writing by the
Underwriter specifically for use in the Registration Statement, any
Preliminary Prospectus or the Prospectus. With respect to the
preceding sentence, the Company acknowledges that the only
information furnished in writing by the Underwriter for use in the
Registration Statement, any Preliminary Prospectus or the
Prospectus is the statements contained in the 4th and 10th paragraphs under
the caption "Underwriting" in the Prospectus (collectively, the
"Underwriter Information").
(b)
As of the Applicable Time (as hereinafter defined), neither (i) (a)
the Statutory Prospectus (as hereinafter defined), (b) the
information set forth on Schedule III hereto which will be provided
orally to investors, nor (c) the Additional Disclosure (as
hereinafter defined) which has been provided orally to investors,
all considered together (collectively, the “General
Disclosure Package”) nor (ii) any individual Issuer Free
Writing Prospectus when considered together with the General
Disclosure Package, included, includes or will include, nor will it
include any untrue statement of a material fact or omitted, omits
or will omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and
warranty shall not apply to statements in or omissions in the
General Disclosure Package made in reliance upon and in conformity
with the Underwriter Information. The Company further represents
and warrants that on or prior to the Applicable Time (as
hereinafter defined), it has provided to investors disclosure
regarding the Company’s current clinical hold substantially
similar to the disclosure in the draft of the Prospectus last
provided to the Underwriter prior to the execution and delivery of
this Agreement (the “Additional
Disclosure”).
Each
Issuer Free Writing Prospectus (as hereinafter defined), including
any electronic road show (including without limitation any
“bona fide electronic road show” as defined in Rule
433(h)(5) under the Securities Act) (each, a “Road
Show”) (i) is identified in Schedule IV hereto and (iii)
complied when issued, and complies, in all material respects with
the requirements of the Securities Act and the Rules and the
Exchange Act and the rules and regulations of the Commission
thereunder.
As used
in this Section and elsewhere in this Agreement:
“Applicable
Time” means 8:00 am (Eastern time) on the date of this
Underwriting Agreement.
“Statutory
Prospectus” as of any time means the Preliminary Prospectus
relating to the Securities that is included in the Registration
Statement immediately prior to the Applicable Time, including any
document incorporated by reference therein and any prospectus
supplement deemed to be a part thereof.
“Issuer Free
Writing Prospectus” means each “free writing
prospectus” (as defined in Rule 405 of the Rules) prepared by
or on behalf of the Company or used or referred to by the Company
in connection with the offering of the Securities, including ,
without limitation, each Road Show.
-3-
(c)
The Registration Statement is
effective under the Securities Act and no stop order preventing or
suspending the effectiveness of the Registration Statement or
suspending or preventing the use of any Preliminary Prospectus, the
Prospectus or any “free writing prospectus,” as defined
in Rule 405 under the Rules, has been issued by the Commission and
no proceedings for that purpose have been instituted or are
threatened under the Securities Act. Any required filing of any
Preliminary Prospectus and/or the Prospectus and any supplement
thereto pursuant to Rule 424(b) of the Rules has been or will be
made in the manner and within the time period required by such Rule
424(b). Any material required to be filed by the Company pursuant
to Rule 443(d) or Rule 163(b)(2) of the Rules has been or will be
made in the manner and within the time period required by such
Rules.
(d)
The documents incorporated by
reference in the Registration Statement, any Preliminary Prospectus
and the Prospectus, at the time they became effective or were filed
with the Commission, as the case may be, complied in all material
respects with the requirements of the Securities Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading, and any further documents so
filed and incorporated by reference in the Registration Statement,
any Preliminary Prospectus and the Prospectus, when such documents
become effective or are filed with the Commission, as the case may
be, will conform in all material respects to the requirements of
the Securities Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder and will not
contain an 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, in light of the circumstances under which
they are made, not misleading.
(e)
Each Issuer Free Writing Prospectus, as of its issue date and at
all subsequent times through the completion of the public offer and
sale of the Securities or until any earlier date that the Company
notified or notifies the Underwriter as described in the next
sentence, did not, does not and will not include any information
that conflicted, conflicts or will conflict with the
information
contained in the
Registration Statement, the Statutory Prospectus or the
Prospectus.
If at
any time following issuance of an Issuer Free Writing Prospectus
there occurred or occurs an event or development as a result of
which such Issuer Free Writing Prospectus conflicted or would
conflict with the information contained in the Registration
Statement, the Statutory Prospectus or the Prospectus or included
or would include an untrue statement of a material fact or omitted
or would omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in
the light of the circumstances prevailing at the subsequent time,
not misleading, the Company has promptly notified or will promptly
notify the Underwriter and has promptly amended or will promptly
amend or supplement, at its own expense, such Issuer Free Writing
Prospectus to eliminate or correct such conflict, untrue statement
or omission.
(f)
The financial statements of the
Company (including all notes and schedules thereto) included or
incorporated by reference in the Registration Statement, the
Statutory Prospectus and Prospectus present fairly the financial
position of the Company and its consolidated subsidiaries at the
dates indicated and the statement of operations, stockholders'
equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; and such financial
statements and related schedules and notes thereto, and the
unaudited financial information filed with the Commission as part
of the Registration Statement, have been prepared in conformity
with generally accepted accounting principles, consistently applied
throughout the periods involved. The summary and selected financial
data, if any, included or incorporated by reference in the
Statutory Prospectus and Prospectus present fairly the information
shown therein as at the respective dates and for the respective
periods specified and have been presented on a basis consistent
with the consolidated financial statements set forth in the
Prospectus and other financial information.
(g)
OUM & Co. LLP (the
“Auditor”) whose reports are filed with the Commission
as a part of the Registration Statement, are and, during the
periods covered by their reports, were independent public
accountants as required by the Securities Act and the
Rules.
(h)
The Company and each of its subsidiaries, including each entity
(corporation, partnership, joint venture, association or other
business organization) controlled directly or indirectly by the
Company (each, a “subsidiary”), is duly organized,
validly existing and in good standing under the laws of their
respective jurisdictions of incorporation or organization and each
such entity has all requisite power and authority to carry on its
business as is currently being conducted as described in the
Statutory Prospectus and the Prospectus, and to own, lease and
operate its properties. All of the issued shares of capital stock
of, or other ownership interests in, each subsidiary have been duly
and validly authorized and issued and are fully paid and
non-assessable and are owned, directly or indirectly, by the
Company, free and clear of any lien, charge, mortgage, pledge,
security interest, claim, limitation on voting rights, equity,
trust or other encumbrance, preferential arrangement, defect or
restriction of any kind whatsoever. The Company and each of its
subsidiaries is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the
nature of the business conducted by it or location of the assets or
properties owned, leased or licensed by it requires such
qualification, except for such jurisdictions where the failure to
so qualify individually or in the aggregate would not have a
material adverse effect on the assets, properties, condition,
financial or otherwise, or in the results of operations, business
affairs or business prospects of the Company and its subsidiaries
considered as a whole (a "Material Adverse Effect"); and to the
Company's knowledge, no proceeding has been instituted in any such
jurisdiction revoking, limiting or curtailing, or seeking to
revoke, limit or curtail, such power and authority or
qualification. The Company does not own, lease or license any asset
or property or conduct any business outside the United States of
America.
-4-
(i)
The Registration Statement initially became effective within three
years of the date hereof. If, immediately prior to the third
anniversary of the initial effective date of the Registration
Statement, any of the Shares and the Warrants remain unsold by the
Underwriter, the Company will, prior to that third anniversary
file, if it has not already done so, a new shelf registration
statement relating to the Shares and the Warrants, in a form
satisfactory to the Underwriter, will use its best efforts to cause
such registration statement to be declared effective within
180 days after that third anniversary, and will take all other
action necessary or appropriate to permit the public offering and
sale of the Shares and the Warrants to continue as contemplated in
the expired Registration Statement. References herein to the
registration statement relating to the Securities shall include
such new shelf registration statement.
(j)
The Company and each of its
subsidiaries has all requisite corporate power and authority, and
all necessary authorizations, approvals, consents, orders,
licenses, certificates and permits of and from all governmental or
regulatory bodies or any other person or entity (collectively, the
"Permits"), to own, lease and license its assets and properties and
conduct its business, all of which are valid and in full force and
effect, except where the lack of such Permits, individually or in
the aggregate, would not have a Material Adverse Effect. The
Company and each of its subsidiaries has fulfilled and performed in
all material respects all of its obligations with respect to such
Permits and no event has occurred that allows, or after notice or
lapse of time would allow, revocation or termination thereof or
results in any other material impairment of the rights of the
Company thereunder. Except as may be required under the Securities
Act and state and foreign Blue Sky laws, no other Permits are
required to enter into, deliver and perform this Agreement and to
issue and sell the Securities.
(k) (i)
At the earliest time after the filing of the Registration Statement
that the Company or another offering participant made a
bona fide offer (within the
meaning of Rule 164(h)(2) of the Rules) of the Securities and
(ii) at the date hereof, the Company was
not and is not an “ineligible issuer,” as defined in
Rule 405 of the Rules, including (but not limited to) the
Company or any other subsidiary in the preceding three years not
having been convicted of a felony or misdemeanor or having been
made the subject of a judicial or administrative decree or order as
described in Rule 405 of the Rules.
(l)
The Company and each of its
subsidiaries owns or possesses legally enforceable rights to use
all patents, patent rights, inventions, trademarks, trademark
applications, trade names, service marks, copyrights, copyright
applications, licenses, know-how and other similar rights and
proprietary knowledge (collectively, "Intangibles") necessary for
the conduct of its business. Neither the Company nor any of its
subsidiaries has received any notice of, or is not aware of, any
infringement of or conflict with asserted rights of others with
respect to any Intangibles.
(m)
The Company and each of its subsidiaries has good and marketable
title in fee simple to all real property, and good and marketable
title to all other property owned by it, in each case free and
clear of all liens, encumbrances, claims, security interests and
defects, except such as do not materially affect the value of such
property and do not materially interfere with the use made or
proposed to be made of such property by the Company and its
subsidiaries. All property held under lease by the Company and its
subsidiaries is held by them under valid, existing and enforceable
leases, free and clear of all liens, encumbrances, claims, security
interests and defects, except such as are not material and do not
materially interfere with the use made or proposed to be made of
such property by the Company and its
subsidiaries.
(n)
Subsequent to the respective dates as
of which information is given in the Registration Statement, the
Statutory Prospectus and the Prospectus, (i) there has not been any
event which could have a Material Adverse Effect; (ii) neither the
Company nor any of its subsidiaries has sustained any loss or
interference with its assets, businesses or properties (whether
owned or leased) from fire, explosion, earthquake, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or any court or legislative or other governmental action,
order or decree which would have a Material Adverse Effect; and
(iii) since the date of the latest balance sheet included in the
Registration Statement and the Prospectus, neither the Company nor
its subsidiaries has (A) except for the issuance of 250,000 shares
of the Company’s unregistered Common Stock (the “Cato
Shares”) having a cash equivalent value of not less than
$1.75 per share issued to Cato Research Ltd., a North Carolina
corporation, for services rendered, issued any securities or
incurred any liability or obligation, direct or contingent, for
borrowed money, except such liabilities or obligations incurred in
the ordinary course of business, (B) entered into any transaction
not in the ordinary course of business or (C) except for regular
dividends on the Common Stock in amounts per share that are
consistent with past practice, declared or paid any dividend or
made any distribution on any shares of its stock or redeemed,
purchased or otherwise acquired or agreed to redeem, purchase or
otherwise acquire any shares of its capital
stock.
-5-
(o)
There
is no document, contract or other agreement required to be
described in the Registration Statement, the Statutory Prospectus
or the Prospectus or to be filed as an exhibit to the Registration
Statement which is not described or filed as required by the
Securities Act or Rules. Each description of a contract, document
or other agreement in the Registration Statement, the Statutory
Prospectus or the Prospectus accurately reflects in all respects
the terms of the underlying contract, document or other agreement.
Each contract, document or other agreement described in the
Registration Statement, the Statutory Prospectus or the Prospectus
or listed in the Exhibits to the Registration Statement or
incorporated by reference is in full force and effect and is valid
and enforceable by and against the Company or its subsidiary, as
the case may be, in accordance with its terms. Neither the Company
nor any of its subsidiaries, if a subsidiary is a party, nor to the
Company's knowledge, any other party is in default in the
observance or performance of any term or obligation to be performed
by it under any such agreement, and no event has occurred which
with notice or lapse of time or both would constitute such a
default, in any such case which default or event, individually or
in the aggregate, would have a Material Adverse Effect. No default
exists, and no event has occurred which with notice or lapse of
time or both would constitute a default, in the due performance and
observance of any term, covenant or condition, by the Company or
its subsidiary, if a subsidiary is a party thereto, of any other
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which Company or its properties or
business or a subsidiary or its properties or business may be bound
or affected which default or event, individually or in the
aggregate, would have a Material Adverse Effect.
(p)
The statistical and market related
data included or incorporated by reference in the Registration
Statement, the Statutory Prospectus or the Prospectus are based on
or derived from sources that the Company believes to be reliable
and accurate.
(q)
Neither the Company nor any subsidiary (i) is in violation of its
certificate or articles of incorporation, by-laws, certificate of
formation, limited liability company agreement, partnership
agreement or other organizational documents, (ii) is in default
under, and no event has occurred which, with notice or lapse of
time, or both, would constitute a default under, or result in the
creation or imposition of any lien, charge, mortgage, pledge,
security interest, claim, limitation on voting rights, equity,
trust or other encumbrance, preferential arrangement, defect or
restriction of any kind whatsoever, upon, any property or assets of
the Company or any subsidiary pursuant to, any bond, debenture,
note, indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is
bound or to which any of its properties or assets is subject or
(iii) is in violation of any statute, law, rule, regulation,
ordinance, directive, judgment, decree or order of any judicial,
regulatory or other legal or governmental agency or body, foreign
or domestic, except (in the case of clauses (ii) and (iii) above)
for violations or defaults that could not (individually or in the
aggregate) reasonably be expected to have a Material Adverse
Effect.
(r)
This Agreement has been duly authorized, executed and delivered by
the Company.
(s)
Neither the execution, delivery and performance of this Agreement
and the Warrants by the Company nor the consummation of any of the
transactions contemplated hereby (including, without limitation,
the issuance and sale by the Company of the Shares and the
Warrants) will give rise to a right to terminate or accelerate the
due date of any payment due under, or conflict with or result in
the breach of any term or provision of, or constitute a default (or
an event which with notice or lapse of time or both would
constitute a default) under, or require any consent or waiver
under, or result in the execution or imposition of any lien, charge
or encumbrance upon any properties or assets of the Company or its
subsidiaries pursuant to the terms of, any indenture, mortgage,
deed of trust or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which either the
Company or its subsidiaries or any of their properties or
businesses is bound, or any franchise, license, permit, judgment,
decree, order, statute, rule or regulation applicable to the
Company or any of its subsidiaries or violate any provision of the
charter or by-laws of the Company or any of its subsidiaries,
except for such consents or waivers which have already been
obtained and are in full force and effect.
(t)
The Company has authorized and outstanding capital stock as set
forth under the caption "Description of Securities We Are Offering"
and “Description of Our Capital Stock” in the Statutory
Prospectus and the Prospectus. The certificates evidencing the
Shares and the Warrants are in due and proper legal form and have
been duly authorized for issuance by the Company. All of the issued
and outstanding shares of Common Stock have been duly and validly
issued and are fully paid and nonassessable. There are no statutory
preemptive or other similar rights to subscribe for or to purchase
or acquire any shares of Common Stock of the Company or any of its
subsidiaries or any such rights pursuant to its Certificate of
Incorporation or by-laws or any agreement or instrument to or by
which the Company or any of its subsidiaries is a party or bound.
The Company has reserved and kept available for the exercise of the
Warrants such number of authorized but unissued shares as are
sufficient to permit the exercise in full of the Warrants. The
Shares, when issued and sold pursuant to this Agreement, and the
Warrant Shares, when issued and sold pursuant to the Warrants, will
be duly and validly issued, fully paid and nonassessable and none
of them will be issued in violation of any preemptive or other
similar right. Except as disclosed in the Registration Statement,
the Statutory Prospectus and the Prospectus, there is no
outstanding option, warrant or other right calling for the issuance
of, and there is no commitment, plan or arrangement to issue, any
share of stock of the Company or any of its subsidiaries or any
security convertible into, or exercisable or exchangeable for, such
stock. The exercise price of each option to acquire Common Stock
(each, a “Company Stock Option”) is no less than the
fair market value of a share of Common Stock as determined on the
date of grant of such Company Stock Option. All grants of Company
Stock Options were validly issued and properly approved by the
Board of Directors of the Company or the Compensation Committee
thereof in material compliance with all applicable laws and the
terms of the plans under which such Company Stock Options were
issued and were recorded on the Company financial statements,
including the documents incorporated by reference in the
Registration Statement, the Statutory Prospectus and the
Prospectus, in accordance with GAAP, and no such grants involved
any “back dating”, “forward dating,”
“spring loading” or similar practices with respect to
the effective date of grant. The Common Stock, the Shares and the
Warrants conform in all material respects to all statements in
relation thereto contained in the Registration Statement, the
Statutory Prospectus and the Prospectus. All outstanding shares of
capital stock of each of the Company's subsidiaries have been duly
authorized and validly issued, and are fully paid and nonassessable
and are owned directly by the Company or by another wholly-owned
subsidiary of the Company free and clear of any security interests,
liens, encumbrances, equities or claims, other than those described
in the Statutory Prospectus and the Prospectus.
-6-
(u)
No holder of any security of the
Company has any right, which has not been waived, to have any
security owned by such holder included in the Registration
Statement or to demand registration of any security owned by such
holder for a period of 180 days after the date of this Agreement.
Each director and executive officer of the Company and each
stockholder of the Company listed on Schedule II hereto has
delivered to the Underwriter his enforceable written lock-up
agreement in the form attached to this Agreement as Exhibit A
hereto ("Lock-Up Agreement").
(v)
There are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely to the
Company or any of its subsidiaries could individually or in the
aggregate have a Material Adverse Effect; and, to the knowledge of
the Company, no such proceedings are threatened or contemplated by
governmental authorities or threatened by
others.
(w)
Neither the Company nor any of its
subsidiaries is involved in any labor dispute nor, to the knowledge
of the Company, is any such dispute threatened, which dispute would
have a Material Adverse Effect. The Company is not aware of any
existing or imminent labor disturbance by the employees of any of
its principal suppliers or contractors which would have a Material
Adverse Effect. The Company is not aware of any threatened or
pending litigation between the Company or its subsidiaries and any
of its executive officers which, if adversely determined, could
have a Material Adverse Effect and has no reason to believe that
such officers will not remain in the employment of the
Company.
(x)
No transaction has occurred between or
among the Company and any of its officers or directors,
shareholders or any affiliate or affiliates of any such officer or
director or shareholder that is required to be described in and is
not described in the Registration Statement, the Statutory
Prospectus and the Prospectus.
(y)
The Company has not taken, nor will it
take, directly or indirectly, any action designed to or which might
reasonably be expected to cause or result in, or which has
constituted or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of the Common Stock
or any security of the Company to facilitate the sale or resale of
any of the Securities.
(z)
The Company and each of its
subsidiaries has filed all Federal, state, local and foreign tax
returns which are required to be filed through the date hereof,
which returns are true and correct in all material respects or has
received timely extensions thereof, and has paid all taxes shown on
such returns and all assessments received by it to the extent that
the same are material and have become due. There are no tax audits
or investigations pending, which if adversely determined would have
a Material Adverse Effect; nor are there any material proposed
additional tax assessments against the Company or any of its
subsidiaries.
(aa)
The Common Stock is registered
pursuant to Section 12(b) of the Exchange Act and is listed on the
Nasdaq Capital Market. The Company has taken no action designed to,
or likely to have the effect of, terminating the registration of
the Common Stock under the Exchange Act or listing of the Common
Stock on the Nasdaq Capital Market. There is no action pending by
the Company or, to the Company’s knowledge, by the Nasdaq
Capital Market to delist the Common Stock from the Nasdaq Capital
Market, nor has the Company received any notification that the
Nasdaq Capital Market is contemplating terminating such listing.
The Company has submitted a Notification Form: Listing of
Additional Shares with the Nasdaq Capital Market with respect to
the Shares and the Warrant Shares and Nasdaq has raised no
objection with respect to the listing of the Shares and the Warrant
Shares which has not been resolved.
-7-
(bb)
The books, records and accounts of the
Company and its subsidiaries accurately and fairly reflect, the
transactions in, and dispositions of, the assets of, and the
results of operations of, the Company and its subsidiaries. The
Company and each of its subsidiaries maintains a system of internal
accounting controls sufficient to provide reasonable assurances
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
accordance with generally accepted accounting principles 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.
(cc)
The Company has established and
maintains disclosure controls and procedures (as such term is
defined in Rule 13a-15 under the Exchange Act), which: (i) are
designed to ensure that material information relating to the
Company is made known to the Company’s principal executive
officer and its principal financial officer by others within the
Company, particularly during the periods in which the periodic
reports required under the Exchange Act are required to be
prepared; (ii) provide for the periodic evaluation of the
effectiveness of such disclosure controls and procedures at the end
of the periods in which the periodic reports are required to be
prepared; and (iii) are effective in all material respects to
perform the functions for which they were
established.
(dd)
Based on the evaluation of its
disclosure controls and procedures, except as disclosed in the
Statutory Prospectus and the Prospectus, the Company is not aware
of (i) any material weakness or significant deficiency in the
design or operation of internal controls which could adversely
affect the Company’s ability to record, process, summarize
and report financial data or any material weaknesses in internal
controls; or (ii) any fraud, whether or not material, that involves
management or other employees who have a role in the
Company’s internal controls.
(ee)
Except as described in the Statutory
Prospectus and the Prospectus and as preapproved in accordance with
the requirements set forth in Section 10A of the Exchange Act, the
Auditor has not been engaged by the Company to perform any
“prohibited activities” (as defined in Section 10A of
the Exchange Act).
(ff)
Except as described in the Statutory
Prospectus and the Prospectus, there are no material off-balance
sheet arrangements (as defined in Item 303 of Regulation S-K) that
have or are reasonably likely to have a material current or future
effect on the Company’s financial condition, revenues or
expenses, changes in financial condition, results of operations,
liquidity, capital expenditures or capital
resources.
(gg)
The Company’s Board of Directors
has validly appointed an audit committee whose composition
satisfies the requirements of Rule 5605 of the NASDAQ Stock Market
and the Board of Directors and/or the audit committee has adopted a
charter that satisfies the requirements of Rule 5605 of the NASDAQ
Stock Market. The audit committee has reviewed the adequacy of its
charter within the past twelve months.
(hh)
There is and has been no failure on
the part of the Company or any of its directors or officers, in
their capacities as such, to comply with any provision of the
Xxxxxxxx-Xxxxx Act, including, without limitation, Section 402
related to loans and Sections 302 and 906 related to
certifications.
(ii)
The Company and its subsidiaries are
insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are customary in the
businesses in which they are engaged or propose to engage after
giving effect to the transactions described in the Statutory
Prospectus and the Prospectus; all policies of insurance and
fidelity or surety bonds insuring the Company or any of its
subsidiaries or the Company's or its subsidiaries' respective
businesses, assets, employees, officers and directors are in full
force and effect; the Company and each of its subsidiaries are in
compliance with the terms of such policies and instruments in all
material respects; and neither the Company nor any subsidiary of
the Company has any reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business at a cost that is not
materially greater than the current cost. Neither the Company nor
any of its subsidiaries has been denied any insurance coverage
which it has sought or for which it has
applied.
(jj)
Each approval, consent, order,
authorization, designation, declaration or filing of, by or with
any regulatory, administrative or other governmental body necessary
in connection with the execution and delivery by the Company of
this Agreement and the consummation of the transactions herein
contemplated required to be obtained or performed by the Company
(except such additional steps as may be required by the Financial
Industry Regulatory Authority ("FINRA") or may be necessary to
qualify the Securities for public offering by the Underwriter under
the state securities or Blue Sky laws) has been obtained or made
and is in full force and effect.
-8-
(kk)
There are no affiliations with FINRA
among the Company's officers, directors or, to the best of the
knowledge of the Company, any five percent or greater stockholder
of the Company, except as set forth in the Registration Statement,
the Statutory Prospectus and the Prospectus or otherwise disclosed
in writing to the Underwriter.
(ll)
(i) Each of the Company and each of its subsidiaries is in
compliance in all material respects with all rules, laws and
regulation relating to the use, treatment, storage and disposal of
toxic substances and protection of health or the environment
("Environmental Law") which are applicable to its business; (ii)
neither the Company nor its subsidiaries has received any notice
from any governmental authority or third party of an asserted claim
under Environmental Laws; (iii) each of the Company and each of its
subsidiaries has received all permits, licenses or other approvals
required of it under applicable Environmental Laws to conduct its
business and is in compliance with all terms and conditions of any
such permit, license or approval; (iv) to the Company's knowledge,
no facts currently exist that will require the Company or any of
its subsidiaries to make future material capital expenditures to
comply with Environmental Laws; and (v) no property which is or has
been owned, leased or occupied by the Company or its subsidiaries
has been designated as a Superfund site pursuant to the
Comprehensive Environmental Response, Compensation of Liability Act
of 1980, as amended (42 U.S.C. Section 9601, et. seq.) or otherwise
designated as a contaminated site under applicable state or local
law. Neither the Company nor any of its subsidiaries has been named
as a "potentially responsible party" under the CERCLA
1980.
(mm)
In the ordinary course of its
business, the Company periodically reviews the effect of
Environmental Laws on the business, operations and properties of
the Company and its subsidiaries, in the course of which the
Company identifies and evaluates associated costs and liabilities
(including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or
compliance with Environmental Laws, or any permit, license or
approval, any related constraints on operating activities and any
potential liabilities to third parties). On the basis of such
review, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate, have a
Material Adverse Effect.
(nn)
The Company is not and, after giving
effect to the offering and sale of the Shares and the Warrants and
the application of proceeds thereof (including any cash exercise of
the Warrants) as described in the Statutory Prospectus and the
Prospectus, will not be an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "Investment
Company Act").
(oo)
The Company or any other person
associated with or acting on behalf of the Company including,
without limitation, any director, officer, agent or employee of the
Company or its subsidiaries, has not, directly or indirectly, while
acting on behalf of the Company or its subsidiaries
(i) used any corporate funds for unlawful
contributions, gifts, entertainment or other unlawful expenses
relating to political activity; (ii) made any unlawful payment
to foreign or domestic government officials or employees or to
foreign or domestic political parties or campaigns from corporate
funds; (iii) violated any provision of the Foreign Corrupt
Practices Act of 1977, as amended; or (iv) made any other unlawful
payment.
(pp)
The operations of the Company and its
subsidiaries 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 money laundering statutes of all jurisdictions, the
rules and regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the “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 any of its subsidiaries with respect to
the Money Laundering Laws is pending, or to the best knowledge of
the Company, threatened.
(qq)
Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company or any of its subsidiaries is currently
subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department
(“OFAC”); and the Company will not directly or
indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint
venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
-9-
(rr)
Except as described in the Statutory Prospectus and the Prospectus,
and except for the issuance of the Cato Shares, the Company has not
sold or issued any shares of Common Stock during the six-month
period preceding the date of the Prospectus, including any sales
pursuant to Rule 144A under, or Regulations D or S of, the
Securities Act, other than shares issued pursuant to employee
benefit plans, qualified stock options plans or other employee
compensation plans or pursuant to outstanding options, rights or
warrants.
(ss)
The Company has fulfilled its obligations, if any, under the
minimum funding standards of Section 302 of the U.S. Employee
Retirement Income Security Act of 1974 ("ERISA") and the
regulations and published interpretations thereunder with respect
to each "plan" as defined in Section 3(3) of ERISA and such
regulations and published interpretations in which its employees
are eligible to participate and each such plan is in compliance in
all material respects with the presently applicable provisions of
ERISA and such regulations and published interpretations. No
"Reportable Event" (as defined in 12 ERISA) has occurred with
respect to any "Pension Plan" (as defined in ERISA) for which the
Company could have any liability.
(tt)
(uu))
Except as described in the Registration Statement, the General
Disclosure Package and the Prospectus, the Company and each of its
subsidiaries: (A) are and at all times have been, in material
compliance with all statutes, rules and regulations applicable to
the ownership, testing, development, manufacture, packaging,
processing, use, distribution, marketing, labeling, promotion,
sale, offer for sale, storage, import, export or disposal of any
product sold, under development, manufactured or distributed by the
Company or any subsidiary (“Applicable Regulatory
Laws”); (B) have not received any Form 483 from the United
States Food and Drug Administration (“FDA”), notice of
adverse finding, warning letter, or other correspondence or written
notice from the FDA, the Drug Enforcement Administration
(“DEA”) or any other federal, state, local, national or
foreign governmental or regulatory authority alleging or asserting
noncompliance with any Applicable Regulatory Laws or any licenses,
certificates, approvals, clearances, authorizations, permits and
supplements or amendments thereto required by any such Applicable
Regulatory Laws (“Authorizations”); (C) possess all
Authorizations, if any, and such Authorizations are valid and in
full force and effect and neither the Company nor any subsidiary is
in material violation of any term of any such Authorizations; (D)
have not received written notice of any proceeding, hearing,
enforcement, investigation, arbitration or other action from the
FDA, the DEA, or any other federal, state, local, national or
foreign governmental or regulatory authority or third party
alleging that any product, operation or activity is in violation of
any Applicable Regulatory Laws or Authorizations and has no
knowledge that the FDA, the DEA or any other federal, state, local,
national or foreign governmental or regulatory authority or third
party is considering any such proceeding; (E) have not received
written notice that the FDA, DEA or any other federal, state,
local, national or foreign governmental or regulatory authority has
taken, is taking or intends to take action to limit, suspend,
modify or revoke any Authorizations and has no knowledge that the
FDA, DEA or any other federal, state, local, national or foreign
governmental or regulatory authority is considering such action;
(F) have filed, obtained, maintained or submitted all reports,
documents, forms, notices, applications, records, claims,
submissions and supplements or amendments as required by any
Applicable Regulatory Laws or Authorizations except where the
failure to file such reports, documents, forms, notices,
applications, records, claims, submissions and supplements or
amendments would not result in a Material Adverse Effect on the
Company and its subsidiaries, taken as a whole, and that all such
reports, documents, forms, notices, applications, records, claims,
submissions and supplements or amendments were complete and correct
on the date filed (or were corrected or supplemented by a
subsequent submission); and (G) has, and, if still pending, is, to
the Company’s knowledge, conducting all clinical and
preclinical studies in all material respects in accordance with
experimental protocols, procedures and controls generally used by
qualified experts in the clinical or preclinical study of new drugs
or diagnostics as applied to comparable products to those being
developed by the Company. The descriptions of the results of such
studies, trials and tests contained in the Registration Statement,
the Statutory Prospectus and the Prospectus are accurate and
complete in all material respects, and except as set forth in the
Registration Statement, the Statutory Prospectus and the
Prospectus, the Company has no knowledge of any other trials,
studies or tests, the results of which the Company believes
reasonably calls into question the clinical trials, results
described or referred to in the Registration Statement and the
Prospectus when viewed in the context in which such results are
described and the clinical state of development.
-10-
3. Conditions
of the Underwriter’s Obligations. The obligation of
the Underwriter to purchase the Shares and the Warrants is subject
to each of the following terms and conditions:
(a)
The Prospectus shall have been timely
filed with the Commission in accordance with Section 4(a) of this
Agreement and any material required to be filed by the Company
pursuant to Rule 433(d) of the Rules shall have been timely filed
with the Commission in accordance with such
rule.
(b)
No order preventing or suspending the
use of any Preliminary Prospectus, the Prospectus or any
“free writing prospectus” (as defined in Rule 405 of
the Rules) shall have been or shall be in effect and no order
suspending the effectiveness of the Registration Statement shall be
in effect and no proceedings for such purpose shall be pending
before or threatened by the Commission, and any requests for
additional information on the part of the Commission (to be
included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to the satisfaction of the
Commission and the Underwriter. If the Company has elected to rely
upon Rule 430B, Rule 430B information previously omitted from the
effective Registration Statement pursuant to Rule 430B shall have
been transmitted to the Commission for filing pursuant to Rule
424(b) within the prescribed time period and the Company shall have
provided evidence satisfactory to the Underwriter of such timely
filing, or a post-effective amendment providing such information
shall have been promptly filed and declared effective in accordance
with the requirements of Rule 430B.
(c)
The representations and warranties of
the Company contained in this Agreement and in the certificate
delivered pursuant to Section 3(d) shall be true and correct when
made and on and as of the Closing Date as if made on such date. The
Company shall have performed all covenants and agreements and
satisfied all the conditions contained in this Agreement required
to be performed or satisfied by them at or before the Closing
Date.
(d)
The Underwriter shall have received on
the Closing Date a certificate, addressed to the Underwriter and
dated the Closing Date, of the chief executive or chief operating
officer and the chief financial officer or chief accounting officer
of the Company to the effect that: (i) the representations,
warranties and agreements of the Company in this Agreement were
true and correct when made and are true and correct as of the
Closing Date; (ii) the Company has performed all covenants and
agreements and satisfied all conditions contained herein; (iii)
they have carefully examined the Registration Statement, the
Prospectus, the General Disclosure Package and any Issuer Free
Writing Prospectus, and in their opinion (A) as of the Effective
Date the Registration Statement and Prospectus did not include, and
as of the Applicable Time, neither (i) the General Disclosure
Package, nor (ii) any individual Issuer Free Writing Prospectus,
when considered together with the General Disclosure Package,
included any untrue statement of a material fact and did not omit
to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under
which they were made, not misleading, and (B) since the Effective
Date no event has occurred which should have been set forth in a
supplement or otherwise required an amendment to the Registration
Statement, the Statutory Prospectus or the Prospectus; (iv) no stop
order suspending the effectiveness of the Registration Statement
has been issued and, to their knowledge, no proceedings for that
purpose have been instituted or are pending under the Securities
Act and (v) there has not occurred any material adverse change in
the assets, properties, condition, financial or otherwise, or in
the results of operations, business affairs or business prospects
of the Company and its subsidiaries considered as a
whole.
(e)
The Underwriter shall have received:
(i) simultaneously with the execution of this Agreement a signed
letter from the Auditor addressed to the Underwriter and dated the
date of this Agreement, in form and substance reasonably
satisfactory to the Underwriter, containing statements and
information of the type ordinarily included in accountants’
“comfort letters” to underwriters with respect to the
financial statements and certain financial information contained in
the Registration Statement and the Disclosure Package, and (ii) on
the Closing Date, a signed letter from the Auditor addressed to the
Underwriter and dated the date of the Closing Date, in form and
substance reasonably satisfactory to the Underwriter containing
statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in
the Registration Statement and the Prospectus.
-11-
(f)
The Underwriter shall have received on
the Closing Date from Disclosure Law Group LLP, counsel for the
Company, an opinion and negative assurance statement, addressed to
the Underwriter and dated the Closing Date, in form and substance
reasonably satisfactory to the Underwriter.
(g)
The Underwriter shall have received on
the Closing Date from Xxxx Xxxxx, Esq., intellectual property
counsel for the Company, an opinion and negative assurance
statement, addressed to the Underwriter and dated the Closing Date,
in form and substance reasonably satisfactory to the
Underwriter.
(h)
The
Underwriter shall have received on the Closing Date from Xxxxxxxxxx
Xxxxxxx LLP, counsel for the Underwriter, an opinion and negative
assurance statement, addressed to the Underwriter and dated the
Closing Date, in form and substance reasonably satisfactory to the
Underwriter.
(i)
All proceedings taken in connection with the sale of the Shares and
the Warrants as herein contemplated shall be reasonably
satisfactory in form and substance to the Underwriter and its
counsel.
(j)
On or prior to the execution and delivery of this Agreement, the
Underwriter shall have received copies of the Lock-up Agreements
executed by each entity or person listed on Schedule II
hereto.
(k)
The Company shall have submitted a Notification Form: Listing of
Additional Shares Application with the Nasdaq Capital Market with
respect to the Shares and Warrant Shares and the Nasdaq Capital
Market shall have raised no objection with respect to the listing
of the Shares and the Warrant Shares which has not been resolved to
the reasonable satisfaction of the Underwriter on or before the
Closing Date.
(l)
The Underwriter shall be reasonably satisfied that since the
respective dates as of which information is given in the
Registration Statement, the Statutory Prospectus, the General
Disclosure Package and the Prospectus, (i) there shall not have
been any material change in the capital stock of the Company or any
material change in the indebtedness (other than in the ordinary
course of business) of the Company, (ii) except as set forth or
contemplated by the Registration Statement, the Statutory
Prospectus, the General Disclosure Package or the Prospectus, no
material oral or written agreement or other transaction shall have
been entered into by the Company that is not in the ordinary course
of business or that could reasonably be expected to result in a
material reduction in the future earnings of the Company, (iii) no
loss or damage (whether or not insured) to the property of the
Company shall have been sustained that had or could reasonably be
expected to have a Material Adverse Effect, (iv) no legal or
governmental action, suit or proceeding affecting the Company or
any of its properties that is material to the Company or that
affects or could reasonably be expected to affect the transactions
contemplated by this Agreement shall have been instituted or
threatened and (v) there shall not have been any material change in
the assets, properties, condition (financial or otherwise), or in
the results of operations, business affairs or business prospects
of the Company or its subsidiaries considered as a whole that makes
it impractical or inadvisable in the Underwriter’s judgment
to proceed with the purchase or offering of the Shares and the
Warrants as contemplated hereby.
(m)
On or before the Closing Date, FINRA shall have confirmed that it
has not raised any objection with respect to the fairness and
reasonableness of the underwriting terms and agreements in
connection with the offering of the Shares and the
Warrants.
(n)
The Company shall have furnished or caused to be furnished to the
Underwriter such further certificates or documents as the
Underwriter shall have reasonably requested.
-12-
4.
Covenants and other
Agreements of the Company and the Underwriter.
(a)
The Company covenants and agrees as follows:
(i)
The Company shall prepare the
Prospectus in a form approved by the Underwriter and file such
Prospectus pursuant to Rule 424(b) under the Securities Act not
later than the Commission's close of business on the second
business day following the execution and delivery of this
Agreement, or, if applicable, such earlier time as may be required
by the Rules. The Company will file with the Commission all Issuer
Free Writing Prospectuses in the time and manner required under
Rules 433(d) or 163(b)(2) as the case may be.
(ii)
The
Company shall promptly advise the Underwriter in writing (A) when
any post-effective amendment to the Registration Statement shall
have become effective or any supplement to the Prospectus shall
have been filed, (B) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or for
any additional information, (C) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any
preliminary prospectus or any “free writing
prospectus,” as defined in Rule 405 of the Rules, or the
institution or threatening of any proceeding for that purpose and
(D) of the receipt by the Company of any notification with respect
to the suspension of the qualification of the Securities for sale
in any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Company shall not file any
amendment of the Registration Statement or supplement to the
Prospectus or any document incorporated by reference in the
Registration Statement, or any Issuer Free Writing Prospectus
unless the Company has furnished the Underwriter a copy for its
review prior to filing and shall not file any such proposed
amendment or supplement to which the Underwriter reasonably
objects. The Company shall use its best efforts to prevent the
issuance of any such stop order and, if issued, to obtain as soon
as possible the withdrawal thereof.
(iii)
If,
at any time when a prospectus relating to the Securities (or, in
lieu thereof, the notice referred to in Rule 173(a) of the Rules)
is required to be delivered under the Securities Act and any event
occurs as a result of which the Prospectus as then amended or
supplemented would include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were
made not misleading, or if it shall be necessary to amend or
supplement the Prospectus to comply with the Securities Act or the
Rules, the Company promptly shall prepare and file with the
Commission, subject to the second sentence of paragraph (ii) of
this Section 4(a), an amendment or supplement which shall correct
such statement or omission or an amendment which shall effect such
compliance.
(iv)
If
at any time following issuance of an Issuer Free Writing Prospectus
there occurs an event or development as a result of which such
Issuer Free Writing Prospectus would conflict with the information
contained in the Registration Statement or would include an untrue
statement of a material fact or would omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances prevailing at
the subsequent time, not misleading, the Company will promptly
notify the Underwriter and will promptly amend or supplement, at
its own expense, such Issuer Free Writing Prospectus to eliminate
or correct such conflict, untrue statement or
omission.
(v)
The
Company shall make generally available to its security holders and
to the Underwriter as soon as practicable, but not later than 45
days after the end of the 12-month period beginning at the end of
the fiscal quarter of the Company during which the Effective Date
occurs (or 90 days if such 12-month period coincides with the
Company's fiscal year), an earning statement (which need not be
audited) of the Company, covering such 12-month period, which shall
satisfy the provisions of Section 11(a) of the Securities Act or
Rule 158 of the Rules.
(vi)
The
Company shall furnish to the Underwriter and its counsel, without
charge, signed copies of the Registration Statement (including all
exhibits thereto and amendments thereof) and all amendments thereof
and, so long as delivery of a prospectus by the Underwriter or
dealer may be required by the Securities Act or the Rules, as many
copies of any Preliminary Prospectus, any Issuer Free Writing
Prospectus and the Prospectus and any amendments thereof and
supplements thereto as the Underwriter may reasonably request. If
applicable, the copies of the Registration Statement, preliminary
prospectus, any Issuer Free Writing Prospectus and Prospectus and
each amendment and supplement thereto furnished to the Underwriter
will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
-13-
(vii)
The
Company shall cooperate with the Underwriter and its counsel in
endeavoring to qualify the Securities for offer and sale in
connection with the offering under the laws of such jurisdictions
as the Underwriter may designate and shall maintain such
qualifications in effect so long as required for the distribution
of the Shares and the Warrants; provided, however, that the Company
shall not be required in connection therewith, as a condition
thereof, to qualify as a foreign corporation or to execute a
general consent to service of process in any jurisdiction or
subject itself to taxation as doing business in any
jurisdiction.
(viii)
The
Company, during the period when the Prospectus (or in lieu thereof,
the notice referred to in Rule 173(a) of the Rules) is required to
be delivered under the Securities Act and the Rules or the Exchange
Act, will file all reports and other documents required to be filed
with the Commission pursuant to Section 13, 14 or 15 of the
Exchange Act within the time periods required by the Exchange Act
and the regulations promulgated thereunder.
(ix)
Without
the prior written consent of the Underwriter, for a period of 75
days after the date of this Agreement, the Company shall not issue,
sell or register with the Commission (other than on Form S-8 or on
any successor form), or otherwise dispose of, directly or
indirectly, any equity securities of the Company (or any securities
convertible into, exercisable for or exchangeable for equity
securities of the Company), except for (i) the issuance of the
Securities pursuant to the Registration Statement; (ii) the
issuance of shares pursuant to the Company's existing stock option
plan or bonus plan as described in the Registration Statement and
the Prospectus and (iii) the issuance of the Cato Shares. In the
event that during this period, (A) any shares are issued pursuant
to the Company's existing stock option plan or bonus plan that are
exercisable during such 75 day period or (B) any registration is
effected on Form S-8 or on any successor form relating to shares
that are exercisable during such 75 day period, the Company shall
obtain the written agreement of such grantee or purchaser or holder
of such registered securities that, for a period of 75 days after
the date of this Agreement, such person will not, without the prior
written consent of the Underwriter, offer for sale, sell,
distribute, grant any option for the sale of, or otherwise dispose
of, directly or indirectly, or exercise any registration rights
with respect to, any shares of Common Stock (or any securities
convertible into, exercisable for, or exchangeable for any shares
of Common Stock) owned by such person. Notwithstanding the
foregoing, the Company represents and warrants that each such
grantee or purchaser or holder of such registered securities shall
be subject to similar lockup restrictions as set forth on Exhibit A
attached hereto and the Company shall enforce such rights and
impose stop-transfer restrictions on any such sale or other
transfer or disposition of such shares until the end of the
applicable period.
(x)
On
or before completion of this offering, the Company shall make all
filings required under applicable securities laws and by the Nasdaq
Capital Market.
(xi)
Prior
to the Closing Date, the Company will issue no press release or
other communications directly or indirectly and hold no press
conference with respect to the Company, the condition, financial or
otherwise, or the earnings, business affairs or business prospects
of any of them, or the offering of the Securities without the prior
written consent of the Underwriter unless in the judgment of the
Company and its counsel, and after notification to the Underwriter,
such press release or communication is required by
law.
(xii)
The
Company will apply the net proceeds from the offering of the Shares
and the Warrants in the manner set forth under "Use of Proceeds" in
the Prospectus.
(b)
The Company agrees to pay, or
reimburse if paid by the Underwriter, whether or not the
transactions contemplated hereby are consummated or this Agreement
is terminated, all costs and expenses incident to the public
offering of the Securities and the performance of the obligations
of the Company under this Agreement including those relating to:
(i) the preparation, printing, reproduction filing and distribution
of the Registration Statement including all exhibits thereto, each
Preliminary Prospectus, the Prospectus, any Issuer Free Writing
Prospectus, all amendments and supplements thereto and any document
incorporated by reference therein, and the printing, filing and
distribution of this Agreement; (ii) the preparation and delivery
of certificates for the Warrants to or as directed by the
Underwriter (iii) the registration or qualification of the
Securities for offer and sale under the securities or Blue Sky laws
of the various jurisdictions referred to in Section 4(a)(vii) of
this Agreement, including the reasonable fees and disbursements of
counsel for the Underwriter in connection with such registration
and qualification and the preparation, printing, distribution and
shipment of preliminary and supplementary Blue Sky memoranda; (iv)
the furnishing (including costs of shipping and mailing) to the
Underwriter of copies of each Preliminary Prospectus, the
Prospectus and all amendments or supplements to the Prospectus, any
Issuer Free Writing Prospectus and of the several documents
required by this Section to be so furnished, as may be reasonably
requested for use in connection with the offering and sale of the
Shares and the Warrants by the Underwriter or by dealers to whom
Shares and Warrants may be sold; (v) the filing fees of FINRA in
connection with its review of the terms of the public offering and
reasonable fees and disbursements of counsel for the Underwriter in
connection with such review; (vi) listing of the Shares and the
Warrant Shares on the Nasdaq Capital Market; and (vii) all transfer
taxes, if any, with respect to the sale and delivery of the Shares
and the Warrants by the Company to the Underwriter. The Company
will reimburse the Underwriter for its reasonable expenses, in an
amount not to exceed $20,000 without prior written approval by the
Company, and will reimburse the Underwriter for legal fees and
disbursements, in connection with the purchase and sale of the
Shares and the Warrants contemplated hereby in an amount not to
exceed $85,000 (including amounts payable pursuant to clauses (iii)
and (v) above). Subject to the provisions of Section 7, the
Underwriter agrees to pay, whether or not the transactions
contemplated hereby are consummated or this Agreement is
terminated, all costs and expenses incident to the performance of
the obligations of the Underwriter under this Agreement not payable
by the Company pursuant to this paragraph, including, without
limitation, the fees and disbursements of counsel for the
Underwriter in excess of the Company’s reimbursement
obligation as set forth above.
-14-
(c) The
Company acknowledges and agrees that the Underwriter has acted and
is acting solely in the capacity of a principal in an arm’s
length transaction between the Company, on the one hand, and the
Underwriter, on the other hand, with respect to the offering of the
Shares and the Warrants contemplated hereby (including in
connection with determining the terms of the offering) and not as a
financial advisor, agent or fiduciary to the Company or any other
person. Additionally, the Company acknowledges and agrees that the
Underwriter has not and will not advise the Company or any other
person as to any legal, tax, investment, accounting or regulatory
matters in any jurisdiction. The Company has consulted with its own
advisors concerning such matters and shall be responsible for
making its own independent investigation and appraisal of the
transactions contemplated hereby, and the Underwriter shall have no
responsibility or liability to the Company or any other person with
respect thereto, whether arising prior to or after the date hereof.
Any review by the Underwriter of the Company, the transactions
contemplated hereby or other matters relating to such transactions
have been and will be performed solely for the benefit of the
Underwriter and shall not be on behalf of the Company. The Company
agrees that it will not claim that the Underwriter, or any of them,
has rendered advisory services of any nature or respect, or owes a
fiduciary duty to the Company or any other person in connection
with any such transaction or the process leading
thereto.
(d)
The Company represents and agrees
that, unless it obtains the prior consent of the Underwriter, and
the Underwriter represents and agrees that, unless it obtains the
prior consent of the Company, it has not made and will not make any
offer relating to the Shares that would constitute an “issuer
free writing prospectus,” as defined in Rule 433, or
that would otherwise constitute a “free writing
prospectus,” as defined in Rule 405, required to be
filed with the Commission. The Company has complied and will comply
with the requirements of Rule 433 under the Act applicable to any
Issuer Free Writing Prospectus, including timely filing with the
Commission where required, legending and record keeping. The
Company represents that is has satisfied and agrees that it will
satisfy the conditions set forth in Rule 433 of the Rules to avoid
a requirement to file with the Commission any Road
Show.
5. Indemnification.
(a)
The Company agrees to indemnify and hold harmless the Underwriter,
its officers and employees and each person, if any, who controls
the Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act against any and all losses,
claims, damages and liabilities, joint or several (including any
reasonable investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted), to which it, or any of
them, may become subject under the Securities Act, the Exchange Act
or other Federal or state law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities
arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in any preliminary
prospectus, the Registration Statement, the Statutory Prospectus,
the Prospectus, any Issuer Free Writing Prospectus or any
“issuer-information” filed or required to be filed
pursuant to Rule 433(d) of the Rules, any amendment thereof or
supplement thereto, or in any Blue Sky application or other
information or other documents executed by the Company filed in any
state or other jurisdiction to qualify any or all of the Securities
under the securities laws thereof (any such application, document
or information being hereinafter referred to as a "Blue Sky
Application") or arise out of or are based upon any omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (except
in the case of the Registration Statement, in light of the
circumstances under which they were made) not misleading; provided,
however, that such indemnity shall not inure to the benefit of the
Underwriter (or any person controlling the Underwriter) on account
of any losses, claims, damages or liabilities arising from the sale
of the Shares and the Warrants to any person by the Underwriter if
such untrue statement or omission or alleged untrue statement or
omission was made in such preliminary prospectus, the Registration
Statement, the Prospectus, the Statutory Prospectus, any Issuer
Free Writing Prospectus or such amendment or supplement thereto, or
in any Blue Sky Application in reliance upon and in conformity with
the Underwriter Information. This indemnity agreement will be in
addition to any liability which the Company may otherwise
have.
(b)
The Underwriter agrees to indemnify and hold harmless the Company
and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, each director of the Company, and each officer of the
Company who signs the Registration Statement, against any losses,
claims, damages or liabilities to which such party may become
subject, under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any
preliminary prospectus, the Registration Statement, the Statutory
Prospectus, the Prospectus, or any Issuer Free Writing Prospectus
or any “issuer-information” filed or required to be
filed pursuant to Rule 433(d) of the Rules, or any amendment or
supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, the
Registration Statement, the Statutory Prospectus, the Prospectus,
any Issuer Free Writing Prospectus or any such amendment or
supplement thereto in reliance upon and in conformity with the
Underwriter Information; provided, however, that the obligation of
the Underwriter to indemnify the Company (including any controlling
person, director or officer thereof) shall be limited to the amount
of the underwriting discount and commissions applicable to the
Shares and the Warrants to be purchased by the Underwriter
hereunder.
-15-
(c)
Any party that proposes to assert the right to be indemnified under
this Section will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of
which a claim is to be made against an indemnifying party or
parties under this Section, notify each such indemnifying party of
the commencement of such action, suit or proceeding, enclosing a
copy of all papers served. No indemnification provided for in
Section 5(a) or 5(b) shall be available to any party who shall fail
to give notice as provided in this Section 5(c) if the party to
whom notice was not given was unaware of the proceeding to which
such notice would have related and was prejudiced by the failure to
give such notice but the omission so to notify such indemnifying
party of any such action, suit or proceeding shall not relieve it
from any liability that it may have to any indemnified party for
contribution or otherwise than under this Section. In case any such
action, suit or proceeding shall be brought against any indemnified
party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to
such indemnified party of its election so to assume the defense
thereof and the approval by the indemnified party of such counsel,
the indemnifying party shall not be liable to such indemnified
party for any legal or other expenses, except as provided below and
except for the reasonable costs of investigation subsequently
incurred by such indemnified party in connection with the defense
thereof. The indemnified party shall have the right to employ its
counsel in any such action, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless
(i) the employment of counsel by such indemnified party has been
authorized in writing by the indemnifying parties, (ii) the
indemnified party shall have been advised by counsel that there may
be one or more legal defenses available to it which are different
from or in addition to those available to the indemnifying party
(in which case the indemnifying parties shall not have the right to
direct the defense of such action on behalf of the indemnified
party) or (iii) the indemnifying parties shall not have employed
counsel to assume the defense of such action within a reasonable
time after notice of the commencement thereof, in each of which
cases the fees and expenses of counsel shall be at the expense of
the indemnifying parties. An indemnifying party shall not be liable
for any settlement of any action, suit, and proceeding or claim
effected without its written consent, which consent shall not be
unreasonably withheld or delayed.
6. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in Section
5(a) or 5(b) is due in accordance with its terms but for any reason
is unavailable to or insufficient to hold harmless an indemnified
party in respect to any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall
contribute to the aggregate losses, liabilities, claims, damages
and expenses (including any investigation, legal and other expenses
reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims
asserted, but after deducting any contribution received by any
person entitled hereunder to contribution from any person who may
be liable for contribution) incurred by such indemnified party, as
incurred, in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the
Underwriter on the other hand from the offering of the Shares and
the Warrants pursuant to this Agreement or, if such allocation is
not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to
above but also the relative fault of the Company on the one hand
and the Underwriter on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities,
claims, damages or expenses, as well as any other relevant
equitable considerations. The Company and the Underwriter agree
that it would not be just and equitable if contribution pursuant to
this Section 6 were determined by pro rata allocation or by any
other method of allocation which does not take account of the
equitable considerations referred to above. The aggregate amount of
losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission
or alleged omission. Notwithstanding the provisions of this Section
6, the Underwriter shall not be required to contribute any amount
in excess of the
underwriting discounts and commissions applicable to the Shares and
the Warrants purchased by the Underwriter. No person guilty
of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 6, each person, if any, who controls
the Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Underwriter, and each director of the Company,
each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company within the
meaning of the Section 15 of the Securities Act or Section 20 of
the Exchange Act, shall have the same rights to contribution as the
Company. Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding
against such party in respect of which a claim for contribution may
be made against another party or parties under this Section 6,
notify such party or parties from whom contribution may be sought,
but the omission so to notify such party or parties from whom
contribution may be sought shall not relieve the party or parties
from whom contribution may be sought from any other obligation it
or they may have hereunder or otherwise than under this Section 6.
No party shall be liable for contribution with respect to any
action, suit, proceeding or claim settled without its written
consent.
-16-
7. Termination.
(a)
This Agreement may be terminated with respect to the Shares and the
Warrants to be purchased at the Closing Date by the Underwriter by
notifying the Company at any time at or before the Closing Date in
the absolute discretion of the Underwriter if: (i) there has
occurred any material adverse change in the securities markets or
any event, act or occurrence that has materially disrupted, or in
the opinion of the Underwriter, will in the future materially
disrupt, the securities markets or there shall be such a material
adverse change in general financial, political or economic
conditions or the effect of international conditions on the
financial markets in the United States is such as to make it, in
the judgment of the Underwriter, inadvisable or impracticable to
market the Shares and the Warrants or enforce contracts for the
sale of the Shares and the Warrants; (ii) there has occurred any
outbreak or material escalation of hostilities or acts of terrorism
or other calamity or crisis the effect of which on the financial
markets of the United States is such as to make it, in the judgment
of the Underwriter, inadvisable or impracticable to market the
Shares and the Warrants or enforce contracts for the sale of the
Shares and the Warrants; (iii) trading in the Shares or any
securities of the Company has been suspended or materially limited
by the Commission or trading generally on the New York Stock
Exchange, Inc., the NYSE American or the Nasdaq Stock Market has
been suspended or materially limited, or minimum or maximum ranges
for prices for securities shall have been fixed, or maximum ranges
for prices for securities have been required, by any of said
exchanges or by such system or by order of the Commission, FINRA,
or any other governmental or regulatory authority; or (iv) a
banking moratorium has been declared by any state or Federal
authority; or (v) in the judgment of the Underwriter, there has
been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the
Prospectus, any material adverse change in the assets, properties,
condition, financial or otherwise, or in the results of operations,
business affairs or business prospects of the Company and its
subsidiaries considered as a whole, whether or not arising in the
ordinary course of business.
(b)
If this Agreement is terminated pursuant to any of its provisions,
the Company shall not be under any liability to the Underwriter,
and the Underwriter shall not be under any liability to the
Company, except that (x) if this Agreement is terminated by the
Underwriter because of any failure, refusal or inability on the
part of the Company to comply with the terms or to fulfill any of
the conditions of this Agreement, the Company will reimburse the
Underwriter for all out-of-pocket expenses (including the
reasonable fees and disbursements of their counsel) incurred by
them in connection with the proposed purchase and sale of the
Shares and the Warrants or in contemplation of performing their
obligations hereunder and (y) if the Underwriter shall have failed
or refused to purchase the Shares and the Warrants agreed to be
purchased by it under this Agreement, without some reason
sufficient hereunder to justify cancellation or termination of its
obligations under this Agreement, it shall not be relieved of
liability to the Company for damages occasioned by its failure or
refusal.
8. Miscellaneous.
The
respective agreements, representations, warranties, indemnities and
other statements of the Company and the Underwriter, as set forth
in this Agreement or made by or on behalf of them pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by
or on behalf of the Underwriter or the Company or any of their
respective officers, directors or controlling persons referred to
in Sections 5 and 6 hereof, and shall survive delivery of and
payment for the Shares and the Warrants. In addition, the
provisions of Sections 4(b), 5, 6 and 7 shall survive the
termination or cancellation of this Agreement.
This
Agreement has been and is made for the benefit of the Underwriter,
the Company and their respective successors and assigns, and, to
the extent expressed herein, for the benefit of persons controlling
the Underwriter, or the Company, and directors and officers of the
Company, and their respective successors and assigns, and no other
person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any
purchaser of Shares and Warrants from the Underwriter merely
because of such purchase.
All
notices and communications hereunder shall be in writing and mailed
or delivered or by telephone or telegraph if subsequently confirmed
in writing, (a) if to the Underwriter, c/o Oppenheimer & Co.
Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: Equity
Capital Markets, with a copy to Xxxxxxxxxxx & Co. Inc., 00
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: General Counsel,
and to Xxxxxxxxxx Xxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxxxxx and (b) if to the Company, to its
agent for service as such agent's address appears on the cover page
of the Registration Statement with a copy to Disclosure Law Group,
a Professional Corporation, 000 Xxxx Xxxxxxxx, Xxxxx 000, Xxx
Xxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxxx Xxxxxxxx.
-17-
This Agreement shall be governed by and
construed in accordance with the laws of the State of New
York. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same
instrument.
Please
confirm that the foregoing correctly sets forth the agreement among
us.
Very
truly yours,
By
/s/ Xxxxx
Xxxxx
Title: Chief Executive Officer
-18-
Confirmed:
XXXXXXXXXXX &
CO. INC.
By
/s/ Xxxx
Xxxxxxx
Name: Xxxx Xxxxxxx
Title:
Managing Director
SCHEDULE
I
|
|
|
|
|
|
|
Name
|
|
Number of
Shares to
Be Purchased
|
Number of Series A1 Warrants to Be
Purchased
|
Number of Series A2 Warrants to Be
Purchased
|
|
|
|
|
|
|
|
Xxxxxxxxxxx &
Co. Inc.
|
|
1,371,430
|
1,388,931
|
503,641
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
1,371,430
|
1,388,931
|
503,641
|
Sch I -
1
SCHEDULE
II
Lock-up
Signatories
Xxxxx
X. Xxxxx
H.
Xxxxx Xxxxxxxxx,
Ph.D.
Xxx X.
Xxxx
Xxxxx
X. Xxxxxxxxx,
PhD.
Xxxxx
X. Xxx, Ph.D,
MBA
Xxxx X.
Xxxxx, M.D.,
Ph.D.
Xxxxxxx
X. Xxxxxx, CPA
SCHEDULE
III
Pricing
Information (to be provided orally only)
Number
of Shares to be Issued: 1,371,430 shares
Number
of Series A1 Warrants to be Issued: Warrants to Purchase 1,388,931
shares of Common Stock
Series
A1 Warrant Coverage: 101.28%
Series
A1 Warrant Exercise Price: $1.82 per share
Number
of Series A2 Warrants to be Issued: Warrants to Purchase 503,641
shares of Common Stock
Series
A2 Warrant Coverage: 36.72%
Series
A2 Warrant Exercise Price: $1.82 per share
Offering Price:
$1.75 per share and related Warrants
Underwriting
Discount: 7.0%
SCHEDULE
IV
Issuer
Free Writing Prospectuses
None.
