Exhibit 1.1
1,050,000 SHARES of
Common Stock
XXXXX THERAPEUTICS, INC.
UNDERWRITING AGREEMENT
February 22, 2023
Maxim Group LLC
As the Representative of the
Several underwriters, if any, named in Schedule
I hereto
c/o Maxim Group LLC
000 Xxxx Xxxxxx
New York, NY 10022
Ladies and Gentlemen:
The undersigned, Xxxxx Therapeutics, Inc.,
a company incorporated under the laws of Delaware (collectively with its subsidiaries and affiliates, including, without limitation, all
entities disclosed or described in the Registration Statement as being subsidiaries or affiliates of Xxxxx Therapeutics, Inc., the
“Company”), hereby confirms its agreement (this “Agreement”) with the several underwriters (such
underwriters, including the Representative (as defined below), the “Underwriters” and each an “Underwriter”)
named in Schedule I hereto for which Maxim Group LLC is acting as representative to the several Underwriters (the “Representative”
and if there are no Underwriters other than the Representative, references to multiple Underwriters shall be disregarded and the term
Representative as used herein shall have the same meaning as Underwriter) on the terms and conditions set forth herein.
It is understood that the
several Underwriters are to make a public offering of the Public Shares as soon as the Representative deems it advisable to do so. The
Public Shares are to be initially offered to the public at the public offering price set forth in the Prospectus.
It is further understood that
you will act as the Representative for the Underwriters in the offering and sale of the Closing Shares and, if any, the Option Shares
in accordance with this Agreement.
ARTICLE I.
DEFINITIONS
1.1 Definitions.
In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings
set forth in this Section 1.1:
“Action”
shall have the meaning ascribed to such term in Section 3.1(k).
“Affiliate”
means with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled
by or is under common control with such Person as such terms are used in and construed under Rule 405 under the Securities Act.
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally
are open for use by customers on such day.
“Closing”
means the closing of the purchase and sale of the Closing Shares pursuant to Section 2.1.
“Closing
Date” means the hour and the date on the Trading Day on which all conditions precedent to (i) the Underwriters’ obligations
to pay the Closing Purchase Price and (ii) the Company’s obligations to deliver the Closing Shares, in each case, have been
satisfied or waived, but in no event later than 10:00 a.m. (New York City time) on the second (2nd) Trading Day following
the date hereof or at such earlier time as shall be agreed upon by the Representative and the Company.
“Closing
Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b), which aggregate purchase price shall be
net of the underwriting discounts and commissions.
“Closing
Shares” shall have the meaning ascribed to such term in Section 2.1(a).
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is
at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Company
Auditor” means Ernst & Young LLP, with offices located at 00 Xxxx Xxxxxx Xxxxx, Xxxxxx, XX 00000.
“Company
Counsel” means DLA Piper LLP (US), with offices located at 0000 Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000.
“EGS”
means Xxxxxxxx Xxxxxxxx & Schole LLP, with offices located at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Execution
Date” shall mean the date on which the parties execute and enter into this Agreement.
“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers, service providers, or directors
of the Company pursuant to any stock or option plan duly adopted for such purpose by a majority of the non-employee members of the Board
of Directors or a majority of the members of a committee of non-employee directors established for such purpose for services rendered
to the Company, (b) securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or
convertible into shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been
amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities or to extend the term of such securities, and (c) securities issued pursuant to acquisitions
or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued
as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing
of any registration statement in connection therewith during the prohibition period in Section 4.19 herein, and provided that any
such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating
company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional
benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily
for the purpose of raising capital or to an entity whose primary business is investing in securities.
“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.
“FINRA”
means the Financial Industry Regulatory Authority.
“GAAP”
shall have the meaning ascribed to such term in Section 3.1(i).
“Indebtedness”
means (a) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in
the ordinary course of business), (b) all guaranties, endorsements and other contingent obligations in respect of indebtedness of
others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except
guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (c) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with
GAAP.
“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Lock-Up
Agreements” means the lock-up agreements that are delivered on the date hereof by each of the Company’s officers and directors,
in the form of Exhibit A attached hereto.
“Material
Adverse Effect” means (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document,
(ii) a material adverse effect on the results of operations, assets, business, prospects or financial condition of the Company and
the Subsidiaries, taken as a whole or (iii) a material adverse effect on the Company’s ability to perform in any material respect
on a timely basis its obligations under any Transaction Document.
“Offering”
shall have the meaning ascribed to such term in Section 2.1(c).
“Option
Closing Date” shall have the meaning ascribed to such term in Section 2.2(c).
“Option
Closing Purchase Price” shall have the meaning ascribed to such term in Section 2.2(b), which aggregate purchase price
shall be net of the underwriting discounts and commissions.
“Option
Shares” shall have the meaning ascribed to such term in Section 2.2(a).
“Over-Allotment
Option” shall have the meaning ascribed to such term in Section 2.2.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Preliminary
Prospectus” means, if any, any preliminary prospectus relating to the Public Shares included in the Registration Statement or
filed with the Commission pursuant to Rule 424(b).
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Prospectus”
means the final prospectus filed for the Registration Statement.
“Prospectus
Supplement” means, if any, any supplement to the Prospectus complying with Rule 424(b) of the Securities Act that
is filed with the Commission.
“Public
Shares” means, collectively, the Closing Shares and, if any, the Option Shares.
“Registration
Statement” means, collectively, the various parts of the registration statement prepared by the Company on Form S-3 (File
No. 333-250041) with respect to the Public Shares, each as amended as of the date hereof, including the Prospectus and Prospectus
Supplement, if any, the Preliminary Prospectus, if any, and all exhibits filed with or incorporated by reference into such registration
statement, and includes any Rule 462(b) Registration Statement.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from
time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.
“Rule 462(b) Registration
Statement” means any registration statement prepared by the Company registering additional Public Shares, which was filed with
the Commission on or prior to the date hereof and became automatically effective pursuant to Rule 462(b) promulgated by the
Commission pursuant to the Securities Act.
“SEC Reports”
shall have the meaning ascribed to such term in Section 3.1(i).
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Share
Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b).
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.
“Trading
Day” means a day on which the principal Trading Market is open for trading.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, OTCQX or OTCQB (or any successors to any of the foregoing).
“Transaction
Documents” means this Agreement, the Lock-Up Agreements, and any other documents or agreements executed in connection with the
transactions contemplated hereunder.
“Transfer
Agent” means Computershare Inc., with offices located at 000 Xxxxxx Xxxxxx, Xxxxxx, XX 00000, and any successor transfer agent
of the Company.
ARTICLE II.
PURCHASE AND SALE
2.1 Closing.
(a) Upon
the terms and subject to the conditions set forth herein, the Company agrees to sell in the aggregate 1,050,000 shares of Common Stock,
and each Underwriter agrees to purchase, severally and not jointly, at the Closing, the number of shares of Common Stock (the “Closing
Shares”) set forth opposite the name of such Underwriter on Schedule I hereof;
(b) The
aggregate purchase price for the Closing Shares shall equal the amount set forth opposite the name of such Underwriter on Schedule
I hereto (the “Closing Purchase Price”). The purchase price for one Share shall be $4.8825 per Share (the “Share
Purchase Price”); and
(c) On
the Closing Date, each Underwriter shall deliver or cause to be delivered to the Company, via wire transfer, immediately available funds
equal to such Underwriter’s Closing Purchase Price and the Company shall deliver to, or as directed by, such Underwriter its respective
Closing Shares and the Company shall deliver the other items required pursuant to Section 2.3 deliverable at the Closing. Upon satisfaction
of the covenants and conditions set forth in Sections 2.3 and 2.4, the Closing shall occur at the offices of EGS or such other location
as the Company and Representative shall mutually agree. The Public Shares are to be offered initially to the public at the offering price
set forth on the cover page of the Prospectus Supplement (the “Offering”).
2.2 Over-Allotment
Option.
(a) For
the purposes of covering any over-allotments in connection with the distribution and sale of the Closing Shares, the Representative is
hereby granted an option (the “Over-Allotment Option”) to purchase, in the aggregate, up to 157,500 shares of Common
Stock (the “Option Shares”) at the Share Purchase Price.
(b) In
connection with an exercise of the Over-Allotment Option, the purchase price to be paid for the Option Shares is equal to the product
of the Share Purchase Price multiplied by the number of Option Shares to be purchased (the aggregate purchase price to be paid on an Option
Closing Date, the “Option Closing Purchase Price”).
(c) The
Over-Allotment Option granted pursuant to this Section 2.2 may be exercised by the Representative as to all (at any time) or any
part (from time to time) of the Option Shares within 30 days after the Execution Date. An Underwriter will not be under any obligation
to purchase any Option Shares prior to the exercise of the Over-Allotment Option by the Representative. The Over-Allotment Option granted
hereby may be exercised by the giving of oral notice to the Company from the Representative, which must be confirmed in writing by overnight
mail or other electronic transmission setting forth the number of Option Shares to be purchased and the date and time for delivery of
and payment for the Option Shares (each, an “Option Closing Date”), which will not be later than two (2) full
Business Days after the date of the notice or such other time as shall be agreed upon by the Company and the Representative, at the offices
of EGS or at such other place (including remotely by other electronic transmission) as shall be agreed upon by the Company and the Representative.
If such delivery and payment for the Option Shares does not occur on the Closing Date, each Option Closing Date will be as set forth in
the notice. Upon exercise of the Over-Allotment Option, the Company will become obligated to convey to the Underwriters, and, subject
to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Shares specified
in such notice. The Representative may cancel the Over-Allotment Option at any time prior to the expiration of the Over-Allotment Option
by written notice to the Company.
2.3 Deliveries.
The Company shall deliver or cause to be delivered to each Underwriter (if applicable) the following:
(i) At
the Closing Date, the Closing Shares and, as to each Option Closing Date, if any, the applicable Option Shares, which shares shall be
delivered via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters;
(ii) At
the Closing Date, a legal opinion of Company Counsel addressed to the Underwriters, including, without limitation, a negative assurance
letter, in form and substance reasonably satisfactory to the Representative and as to each Option Closing Date, if any, a bring-down opinion
from Company Counsel in form and substance reasonably satisfactory to the Representative, including, without limitation, a negative assurance
letter, addressed to the Underwriters and in form and substance satisfactory to the Representative;
(iii) At
the Closing Date, a legal opinion of intellectual property legal counsel to the Company in form and substance reasonably satisfactory
to the Representative and as to each Option Closing Date, if any, a bring-down opinion;
(iv) Contemporaneously
herewith, a cold comfort letter, addressed to the Underwriters and in form and substance satisfactory in all respects to the Representative
from the Company Auditor dated, respectively, as of the date of this Agreement and a bring-down letter dated as of the Closing Date and
each Option Closing Date, if any;
(v) Contemporaneously
herewith, a chief financial officer certificate, addressed to the Underwriters and in form and substance satisfactory in all respects
to the Representative from the Company’s chief financial officer dated, respectively, as of the date of this Agreement and a bring-down
certificate dated as of the Closing Date and each Option Closing Date, if any;
(vi) On
the Closing Date and on each Option Closing Date, the duly executed and delivered Officer’s Certificate, in form and substance reasonably
satisfactory to the Representative;
(vii) On
the Closing Date and on each Option Closing Date, the duly executed and delivered Secretary’s Certificate, in form and substance
reasonably satisfactory to the Representative; and
(viii) Contemporaneously
herewith, the duly executed and delivered Lock-Up Agreements.
2.4 Closing
Conditions. The respective obligations of each Underwriter hereunder in connection with the Closing and each Option Closing Date are
subject to the following conditions being met:
(i) the accuracy in all material respects when made and on the date in question (other than
representations and warranties of the Company already qualified by materiality, which shall be true and correct in all respects) of
the representations and warranties of the Company contained herein (unless as of a specific date therein);
(ii) all
obligations, covenants and agreements of the Company required to be performed at or prior to the date in question shall have been performed;
(iii) the delivery by the Company of the items set forth in Section 2.3 of this
Agreement;
(iv) the
Registration Statement shall be effective on the date of this Agreement and at each of the Closing Date and each Option Closing Date,
if any, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose
shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of the Representative;
(v) by
the Execution Date, if required by FINRA, the Underwriters shall have received clearance from FINRA as to the amount of compensation allowable
or payable to the Underwriters as described in the Registration Statement;
(vi) the
Closing Shares and the Option Shares have been approved for listing on the Trading Market; and
(vii) prior
to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no material adverse change or
development involving a prospective material adverse change in the condition or prospects or the business activities, financial or otherwise,
of the Company from the latest dates as of which such condition is set forth in the Registration Statement and Prospectus; (ii) no
action suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Affiliate of the Company
before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or
finding may materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as
set forth in the Registration Statement and Prospectus; (iii) no stop order shall have been issued under the Securities Act and no
proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement and the Prospectus
and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance
with the Securities Act and the rules and regulations thereunder and shall conform in all material respects to the requirements of
the Securities Act and the rules and regulations thereunder, and neither the Registration Statement nor the Prospectus nor any amendment
or supplement thereto shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations
and Warranties of the Company. The Company represents and warrants to the Underwriters as of the Execution Date, as of the Closing
Date and as of each Option Closing Date, if any, as follows:
(a) Subsidiaries.
All of the direct and indirect Subsidiaries of the Company are set forth in the SEC Reports. The Company owns, directly or indirectly,
all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights
to subscribe for or purchase securities. If the Company has no Subsidiaries, all other references to the Subsidiaries or any of them in
the Transaction Documents shall be disregarded.
(b) Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to
own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in
violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational
or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected
to result in a Material Adverse Effect and 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.
(c) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by this Agreement and each of the other Transaction Documents to which the Company is a party and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and
the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part
of the Company and no further action is required by the Company, the Board of Directors or the Company’s stockholders in connection
herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which
the Company is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with
the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance
with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium
and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating
to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable law.
(d) No
Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it
is a party, the issuance and sale of the Public Shares and the consummation by it of the transactions contemplated hereby and thereby
do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles
of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event
that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties
or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments,
acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by
which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict
with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any
property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such
as could not have or reasonably be expected to result in a Material Adverse Effect.
(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to,
or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection
with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filing with the Commission
of the Prospectus Supplement and (ii) such filings as are required to be made under applicable state securities laws (collectively,
the “Required Approvals”).
(f) Registration
Statement. The Company has filed with the Commission the Registration Statement under the Securities Act, which became effective on
November 30, 2020, for the registration under the Securities Act of the Securities. At the time of such filing, the Company met the
requirements of Form S-3 under the Securities Act. The Registration Statement meets the requirements set forth in Rule 415(a)(1)(x) under
the Securities Act and complies with said Rule and the Prospectus Supplement will meet the requirements set forth in Rule 424(b).
The Company is eligible to use Form S-3 under the Securities Act and it meets the transaction requirements with respect to the aggregate
market value of securities being sold pursuant to this offering and during the twelve (12) months prior to this offering, as set forth
in General Instruction I.B.6 of Form S-3. The Company has advised or made available to the Representative of all further information
(financial and other) with respect to the Company required to be set forth therein in the Registration Statement and Prospectus Supplement.
Any reference in this Agreement to the Registration Statement, the Prospectus or the Prospectus Supplement shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 which were filed under the Exchange Act,
on or before the date of this Agreement, or the issue date of the Prospectus or the Prospectus Supplement, as the case may be; and any
reference in this Agreement to the terms “amend,” “amendment” or “supplement” with respect to the
Registration Statement, the Prospectus or the Prospectus Supplement shall be deemed to refer to and include the filing of any document
under the Exchange Act after the date of this Agreement, or the issue date of the Prospectus or the Prospectus Supplement, as the case
may be, deemed to be incorporated therein by reference. All references in this Agreement to financial statements and schedules and other
information which is “contained,” “included,” “described,” “referenced,” “set forth”
or “stated” in the Registration Statement, the Prospectus or the Prospectus Supplement (and all other references of like import)
shall be deemed to mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated
by reference in the Registration Statement, the Prospectus or the Prospectus Supplement, as the case may be. No stop order suspending
the effectiveness of the Registration Statement or the use of the Prospectus or the Prospectus Supplement has been issued, and no proceeding
for any such purpose is pending or has been initiated or, to the Company's knowledge, is threatened by the Commission. For purposes of
this Agreement, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act. The
Company will not, without the prior consent of the Representative, prepare, use or refer to, any free writing prospectus.
(g) Issuance
of Shares. The Public Shares are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents,
will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The holder of the Public
Shares will not be subject to personal liability by reason of being such holders. The Public Shares are not and will not be subject to
the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. All corporate
action required to be taken for the authorization, issuance and sale of the Public Shares has been duly and validly taken. The Public
Shares conform in all material respects to all statements with respect thereto contained in the Registration Statement.
(h) Capitalization.
The capitalization of the Company as of September 30, 2022 is as set forth in the SEC Reports. The Company has not issued any capital
stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options
under the Company’s stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee
stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most
recently filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as set forth in the SEC Reports,
there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to,
or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe
for or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements
by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents or
the capital stock of any Subsidiary. The issuance and sale of the Public Shares will not obligate the Company or any Subsidiary to issue
shares of Common Stock or other securities to any Person (other than the Underwriters). There are no outstanding securities or instruments
of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or
instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the
Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. The
Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement.
All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any
preemptive rights or similar rights to subscribe for or purchase securities. The authorized shares of the Company conform in all material
respects to all statements relating thereto contained in the Registration Statement and the Prospectus. The offers and sales of the Company’s
securities were at all relevant times either registered under the Securities Act and the applicable state securities or Blue Sky laws
or, based in part on the representations and warranties of the purchasers, exempt from such registration requirements. No further approval
or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Public Shares. There
are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which
the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
(i) SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be
filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material)
(the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Prospectus
and the Prospectus Supplement, being collectively referred to herein as the “SEC Reports”) on a timely basis or has
received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As
of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange
Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The financial statements of the Company included in the SEC Reports comply in all material respects with
applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time
of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied
on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly
present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof
and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial,
year-end audit adjustments. The agreements and documents described in the Registration Statement, the Prospectus, the Prospectus Supplement
and the SEC Reports conform to the descriptions thereof contained therein and there are no agreements or other documents required by the
Securities Act and the rules and regulations thereunder to be described in the Registration Statement, the Prospectus, the Prospectus
Supplement or the SEC Reports or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described
or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or
may be bound or affected and (i) that is referred to in the Registration Statement, the Prospectus, the Prospectus Supplement or
the SEC Reports, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company,
is in full force and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the
other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution
provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding
therefore may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the
best of the Company’s knowledge, any other party is in default thereunder and, to the best of the Company’s knowledge, no
event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best of
the Company’s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result
in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic
or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to
environmental laws and regulations.
(j) Material Changes; Undisclosed Events, Liabilities or Developments. Since the date
of the latest audited financial statements included within the SEC Reports, except as disclosed in a subsequent SEC Report filed
prior to the date hereof, (i) there has been no event, occurrence or development that has had or that could reasonably be
expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise)
other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice
and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in
filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not
declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any
agreements to purchase or redeem any shares of its capital stock, (v) the Company has not issued any equity securities to any
officer, director or Affiliate, except pursuant to existing Company stock option plans and (vi) no officer or director of the
Company has resigned from any position with the Company. The Company does not have pending before the Commission any request for
confidential treatment of information. Except for the issuance of the Public Shares contemplated by this Agreement, no event,
liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with
respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial
condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is
made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is made.
Except as disclosed in an SEC Report filed prior to the date hereof, the Company has not: (i) issued any securities or incurred
any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other
distribution on or in respect to its capital stock.
(k) Litigation.
There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened
against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental
or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”). Neither
the Company nor any Subsidiary, nor to the knowledge of the Company any director or officer thereof, is or has been the subject of any
Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There
has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving
the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending
the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(l) Labor Relations. No labor dispute exists or, to the knowledge of the Company, is
imminent with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse
Effect. None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such
employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to
a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are
good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in
violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or
non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the
continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with
respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and
foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and
hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(m) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or
any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement
or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default
or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental
authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including
without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety,
product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result
in a Material Adverse Effect.
(n) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except
where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (each, a “Material
Permit”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification
of any Material Permit. The disclosures in the Registration Statement concerning the effects of Federal, State, local and all foreign
regulation on the Company’s business as currently contemplated are correct in all material respects.
(o) Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to, or have valid and marketable rights to
lease or otherwise use, all real property and all personal property that is material to the business of the Company and the Subsidiaries,
in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens
for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP, and
the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company
and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in
compliance.
(p) Intellectual
Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights
necessary or required for use in connection with their respective businesses as described in the SEC Reports and which the failure to
do so could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None of, and neither
the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired,
terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement.
Neither the Company nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC
Reports, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the
rights of any Person except as would reasonably be expected to result in a Material Adverse Effect. To the knowledge of the Company, all
such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property
Rights. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of
all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(q) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited
to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant increase in cost.
(r) Transactions
With Affiliates and Employees. None of the officers or directors of the Company or any Subsidiary and, to the knowledge of the Company,
none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other
than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing
of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending
of money to or otherwise requiring payments to or from, any officer, director or such employee or, to the knowledge of the Company, any
entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder,
member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered,
(ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option
agreements under any stock option plan of the Company.
(s) Xxxxxxxx-Xxxxx;
Internal Accounting Controls. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the Xxxxxxxx-Xxxxx
Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the Commission
thereunder that are effective as of the date hereof and as of the Closing Date. The Company and the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s
general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and
designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it
files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s
rules and forms. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures
of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange
Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting
(as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely
to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.
(t) Certain
Fees. Except as set forth in the Prospectus Supplement, no brokerage or finder’s fees or commissions are or will be payable
by the Company, any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. To the Company’s knowledge,
there are no other arrangements, agreements or understandings of the Company or, to the Company’s knowledge, any of its stockholders
that may affect the Underwriters’ compensation, as determined by FINRA. The Company has not made any direct or indirect payments
(in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or otherwise, in consideration of
such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company; (ii)
any FINRA member; or (iii) any person or entity that has any direct or indirect affiliation or association with any FINRA member,
within the twelve months prior to the Execution Date, other than the prior payment of $20,000 to the Representative as provided hereunder
in connection with the Offering. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member
or its affiliates, except as specifically authorized herein.
(u) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Public Shares will not be
or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. The Company
shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the
Investment Company Act of 1940, as amended.
(v) Registration
Rights. Except as set forth in the SEC Reports, no Person has any right to cause the Company or any Subsidiary to effect the registration
under the Securities Act of any securities of the Company or any Subsidiary.
(w) Listing
and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) of the Exchange Act, and the Company
has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration.
Except as disclosed in the SEC Reports, the Company has not, in the 12 months preceding the date hereof, received notice from any Trading
Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing
or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future
continue to be, in compliance with all such listing and maintenance requirements. The Common Stock is currently eligible for electronic
transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the
fees of the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.
(x) Application
of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render inapplicable
any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of its state
of incorporation that is or could become applicable as a result of the Underwriters and the Company fulfilling their obligations or exercising
their rights under the Transaction Documents.
(y) Disclosure;
10b-5. The Registration Statement (and any further documents to be filed with the Commission) contains all exhibits and schedules
as required by the Securities Act. Each of the Registration Statement and any post-effective amendment thereto, if any, at the time it
became effective, complied in all material respects with the Securities Act and the Exchange Act and the applicable rules and regulations
under the Securities Act and did not and, as amended or supplemented, if applicable, will not, contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Preliminary
Prospectus, Prospectus and the Prospectus Supplement, each as of its respective date, comply in all material respects with the Securities
Act and the Exchange Act and the applicable rules and regulations. Each of the Preliminary Prospectus, Prospectus and the Prospectus
Supplement, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made,
not misleading. The SEC Reports, when they were filed with the Commission, conformed in all material respects to the requirements of the
Exchange Act and the applicable rules and regulations, and none of such documents, when they were filed with the Commission, contained
any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect to
the SEC Reports incorporated by reference in the Preliminary Prospectus, Prospectus or Prospectus Supplement), in light of the circumstances
under which they were made not misleading; and any further documents so filed and incorporated by reference in the Preliminary Prospectus,
Prospectus or Prospectus Supplement, when such documents are filed with the Commission, will conform in all material respects to the requirements
of the Exchange Act and the applicable rules and regulations, as applicable, and will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made
not misleading. No post-effective amendment to the Registration Statement reflecting any facts or events arising after the date thereof
which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with
the Commission. There are no documents required to be filed with the Commission in connection with the transaction contemplated hereby
that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed within the requisite time period.
There are no contracts or other documents required to be described in the Preliminary Prospectus, Prospectus or Prospectus Supplement,
or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required. The press releases
disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement
of a material fact or omit to state a 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 and when made, not misleading.
(z) No
Integrated Offering. Neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause
this offering of the Public Shares to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval
provisions of any Trading Market on which any of the securities of the Company are listed or designated.
(aa) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company
of the proceeds from the sale of the Public Shares hereunder, (i) the fair saleable value of the Company’s assets exceeds
the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known
contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on
its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital
requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof,
and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of
its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its
liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts
as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge
of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization
laws of any jurisdiction within one year from the Closing Date. The SEC Reports sets forth as of the date hereof all outstanding secured
and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. Neither the
Company nor any Subsidiary is in default with respect to any Indebtedness.
(bb) Stock
Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance
with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value
of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted
under the Company’s stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no
Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with,
the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results
or prospects.
(cc) Tax
Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material
Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and
all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has
paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns,
reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes
for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no
basis for any such claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration
Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of
such consolidated financial statements. The term “taxes” mean all federal, state, local, foreign, and other net income, gross
income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll,
employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments,
or charges of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect
thereto. The term “returns” means all returns, declarations, reports, statements, and other documents required to be filed
in respect to taxes.
(dd) Foreign
Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other
person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions,
gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment
to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate
funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its
behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of FCPA.
The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply
in all material respects with the FCPA.
(ee) Accountants.
To the knowledge and belief of the Company, the Company Auditor (i) is an independent registered public accounting firm as required
by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company’s
Annual Report for the fiscal year ending December 31, 2022.
(ff) FDA.
As to each product subject to the jurisdiction of the U.S. Food and Drug Administration (“FDA”) under the Federal Food,
Drug and Cosmetic Act, as amended, and the regulations thereunder (“FDCA”) that is manufactured, packaged, labeled,
tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each such product, a “Pharmaceutical Product”),
such Pharmaceutical Product is being manufactured, packaged, labeled, tested, distributed, sold and/or marketed by the Company in compliance
with all applicable requirements under FDCA and similar laws, rules and regulations relating to registration, investigational use,
premarket clearance, licensure, or application approval, good manufacturing practices, good laboratory practices, good clinical practices,
product listing, quotas, labeling, advertising, record keeping and filing of reports, except where the failure to be in compliance would
not have a Material Adverse Effect. There is no pending, completed or, to the Company's knowledge, threatened, action (including any lawsuit,
arbitration, or legal or administrative or regulatory proceeding, charge, complaint, or investigation) against the Company or any of its
Subsidiaries, and none of the Company or any of its Subsidiaries has received any notice, warning letter or other communication from the
FDA or any other governmental entity, which (i) contests the premarket clearance, licensure, registration, or approval of, the uses
of, the distribution of, the manufacturing or packaging of, the testing of, the sale of, or the labeling and promotion of any Pharmaceutical
Product, (ii) withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws or orders the withdrawal of
advertising or sales promotional materials relating to, any Pharmaceutical Product, (iii) imposes a clinical hold on any clinical
investigation by the Company or any of its Subsidiaries, (iv) enjoins production at any facility of the Company or any of its Subsidiaries,
(v) enters or proposes to enter into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or (vi) otherwise
alleges any violation of any laws, rules or regulations by the Company or any of its Subsidiaries, and which, either individually
or in the aggregate, would have a Material Adverse Effect. The properties, business and operations of the Company have been and are being
conducted in all material respects in accordance with all applicable laws, rules and regulations of the FDA. The Company has
not been informed by the FDA that the FDA will prohibit the marketing, sale, license or use in the United States of any product proposed
to be developed, produced or marketed by the Company nor has the FDA expressed any concern as to approving or clearing for marketing any
product being developed or proposed to be developed by the Company.
(gg) Office
of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent,
employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department.
(hh) U.S.
Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning
of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Representative’s
request.
(ii) Bank
Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956,
as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal
Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent
(5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a
bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries
or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and
to regulation by the Federal Reserve.
(jj) Money
Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in material compliance with
applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering
Laws”), and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving
the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary,
threatened.
(kk) D&O
Questionnaires. To the Company’s knowledge, all information contained in the questionnaires completed by each of the Company’s
directors and officers immediately prior to the Offering and in the Lock-Up Agreement provided to the Underwriters is true and correct
in all respects and the Company has not become aware of any information which would cause the information disclosed in such questionnaires
become inaccurate and incorrect.
(ll) FINRA
Affiliation. No officer, director or any beneficial owner of 5% or more of the Company’s unregistered securities has any direct
or indirect affiliation or association with any FINRA member (as determined in accordance with the rules and regulations of FINRA)
that is participating in the Offering. The Company will advise the Representative and EGS if it learns that any officer, director or
owner of 5% or more of the Company’s outstanding shares of Common Stock or Common Stock Equivalents is or becomes an affiliate
or associated person of a FINRA member firm.
(mm) Officers’
Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to the Representative or EGS shall
be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
(nn) Board
of Directors. The qualifications of the persons serving as board members and the overall composition of the Board of Directors comply
with the Xxxxxxxx-Xxxxx Act of 2002 and the rules promulgated thereunder applicable to the Company and the rules of the Trading
Market. At least one member of the Board of Directors qualifies as a “financial expert” as such term is defined under the
Xxxxxxxx-Xxxxx Act of 2002 and the rules promulgated thereunder and the rules of the Trading Market. In addition, at least
a majority of the persons serving on the Board of Directors qualify as “independent” as defined under the rules of the
Trading Market.
(oo) Cybersecurity.
Except as would not reasonably be expected to result in a Material Adverse Effect, (i)(x) There has been no security
breach or other compromise of or relating to any of the Company’s or any Subsidiary’s information technology and
computer systems, networks, hardware, software, data (including the data of its respective customers, employees, suppliers, vendors
and any third party data maintained by or on behalf of it), equipment or technology (collectively, “IT Systems and
Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of any event or
condition that would reasonably be expected to result in, any security breach or other compromise to its IT Systems and Data;
(ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments,
orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and
contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and
Data from unauthorized use, access, misappropriation or modification, except as would not, individually or in the aggregate, have a
Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and maintained commercially reasonable
safeguards to maintain and protect its material confidential information and the integrity, continuous operation, redundancy and
security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented backup and disaster recovery
technology consistent with industry standards and practices.
(pp) Environmental
Laws. The Company and its Subsidiaries (i) are
in compliance with all federal, state, local and foreign laws relating to pollution or protection of human health or the environment
(including ambient air, surface water, groundwater, land surface or subsurface strata), including laws relating to emissions, discharges,
releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous
Materials”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions,
judgments, licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder
(“Environmental Laws”); (ii) have received all permits licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such
permit, license or approval where in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect.
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 Amendments
to Registration Statement. The Company has delivered, or will as promptly as practicable deliver, to the Underwriters complete conformed
copies of the Registration Statement and of each consent and certificate of experts, as applicable, filed as a part thereof, and conformed
copies of the Registration Statement (without exhibits), the Prospectus and the Prospectus Supplement, as amended or supplemented, in
such quantities and at such places as an Underwriter reasonably requests. Neither the Company nor any of its directors and officers has
distributed and none of them will distribute, prior to the Closing Date, any offering material in connection with the offering and sale
of the Public Shares other than the Prospectus, the Prospectus Supplement, the Registration Statement, and copies of the documents incorporated
by reference therein. The Company shall not file any such amendment or supplement to which the Representative shall reasonably object
in writing.
4.2 Federal
Securities Laws.
(a) Compliance.
During the time when a Prospectus is required to be delivered under the Securities Act, the Company will use its best efforts to comply
with all requirements imposed upon it by the Securities Act and the rules and regulations thereunder and the Exchange Act and the
rules and regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings
in the Public Shares in accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Public
Shares is required to be delivered under the Securities Act, any event shall have occurred as a result of which, in the opinion of counsel
for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material
fact or omits to state any 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, or if it is necessary at any time to amend the Prospectus to comply with the Securities Act,
the Company will notify the Underwriters promptly and prepare and file with the Commission, subject to Section 4.1 hereof, an appropriate
amendment or supplement in accordance with Section 10 of the Securities Act.
(b) Filing
of Final Prospectus Supplement. The Company will file the Prospectus Supplement (in form and substance satisfactory to the Representative)
with the Commission pursuant to the requirements of Rule 424.
(c) Exchange
Act Registration. For a period of three years from the Execution Date, the Company will use its best efforts to maintain the registration
of the Common Stock under the Exchange Act. The Company will not deregister the Common Stock under the Exchange Act without the prior
written consent of the Representative.
(d) Free
Writing Prospectuses. The Company represents and agrees that it has not made and will not make any offer relating to the Public Shares
that would constitute an issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the Securities
Act, without the prior written consent of the Representative. Any such free writing prospectus consented to by the Representative is herein
referred to as a “Permitted Free Writing Prospectus.” The Company represents that it will treat each Permitted
Free Writing Prospectus as an “issuer free writing prospectus” as defined in rule and regulations under the Securities
Act, and has complied and will comply with the applicable requirements of Rule 433 of the Securities Act, including timely Commission
filing where required, legending and record keeping.
4.3 Delivery
to the Underwriters of Prospectuses. The Company will deliver to the Underwriters, without charge, from time to time during the period
when the Prospectus is required to be delivered under the Securities Act or the Exchange Act such number of copies of each Prospectus
as the Underwriters may reasonably request and, as soon as the Registration Statement or any amendment or supplement thereto becomes effective,
deliver to you two original executed Registration Statements, including exhibits, and all post-effective amendments thereto and copies
of all exhibits filed therewith or incorporated therein by reference and all original executed consents of certified experts.
4.4 Effectiveness
and Events Requiring Notice to the Underwriters. The Company will use its best efforts to cause the Registration Statement to remain
effective with a current prospectus until nine (9) months from the Execution Date, and will notify the Underwriters immediately and
confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the
issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of
the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Public Shares for offering
or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and
delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt
of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the
period described in this Section 4.4 that, in the judgment of the Company, makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order
to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state
securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort
to obtain promptly the lifting of such order.
4.5 Review
of Financial Statements. For a period of five (5) years from the Execution Date, the Company, at its expense, shall cause its
regularly engaged independent registered public accountants to review (but not audit) the Company’s financial statements for each
of the first three fiscal quarters prior to the announcement of quarterly financial information.
4.6 Expenses
of the Offering.
(a) General
Expenses Related to the Offering. The Company hereby agrees to pay on each of the Closing Date and each Option Closing Date, if any,
to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement,
including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Public Shares to
be sold in the Offering (including the Option Shares) with the Commission; (b) all FINRA Public Offering Filing System fees associated
with the review of the Offering by FINRA in an amount not to exceed $15,000; all fees and expenses relating to the listing of such Closing
Shares and Option Shares on the Trading Market and such other stock exchanges as the Company and the Representative together determine;
(c) all fees, expenses and disbursements relating to the registration or qualification of such Public Shares under the “blue
sky” securities laws of such states and other foreign jurisdictions as the Representative may reasonably designate; (d) the
costs of all mailing and printing of the underwriting documents (including, without limitation, the Underwriting Agreement, any Blue Sky
Surveys and, if appropriate, any Agreement Among Underwriters, Selected Dealers’ Agreement, Underwriters’ Questionnaire and
Power of Attorney), Registration Statements, Prospectuses and all amendments, supplements and exhibits thereto and as many preliminary
and final Prospectuses as the Representative may reasonably deem necessary; (e) the costs and expenses of the Company’s public
relations firm; (f) the costs of preparing, printing and delivering the Public Shares; (g) fees and expenses of the Transfer
Agent for the Public Shares (including, without limitation, any fees required for same-day processing of any instruction letter delivered
by the Company); (h) stock transfer and/or stamp taxes, if any, payable upon the transfer of securities from the Company to the Underwriters;
(i) the fees and expenses of the Company’s accountants; (j) the fees and expenses of the Company’s legal counsel
and other agents and representatives; (k) the Underwriters’ costs of mailing prospectuses to prospective investors; and (l) up
to $65,000 for the fees and expenses of EGS, inclusive of any funds previously advanced to the Representative for reasonable out-of-pocket
expenses. The Underwriters may also deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or each Option
Closing Date, if any, the expenses set forth herein to be paid by the Company to the Underwriters.
4.7 Application
of Net Proceeds. The Company will apply the net proceeds from the Offering received by it in a manner consistent with the application
described under the caption “Use of Proceeds” in the Prospectus.
4.8 Delivery
of Earnings Statements to Security Holders. The Company will make generally available to its security holders as soon as practicable,
but not later than the first day of the fifteenth full calendar month following the Execution Date, an earnings statement (which need
not be certified by independent public or independent certified public accountants unless required by the Securities Act or the Rules and
Regulations under the Securities Act, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of
the Securities Act) covering a period of at least twelve consecutive months beginning after the Execution Date.
4.9 Stabilization.
Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders (without the consent of the Representative)
has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to
cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Public Shares.
4.10 Internal
Controls. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions
are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary
in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets; (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 existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
4.11 Accountants.
The Company shall continue to retain a nationally recognized independent certified public accounting firm for a period of at least three
years after the Execution Date. The Underwriters acknowledge that the Company Auditor is acceptable to the Underwriters.
4.12 FINRA.
The Company shall advise the Underwriters (who shall make an appropriate filing with FINRA) if it is aware that any 5% or greater shareholder
of the Company becomes an affiliate or associated person of an Underwriter.
4.13 No
Fiduciary Duties. The Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely contractual
and commercial in nature, based on arms-length negotiations and that neither the Underwriters nor their affiliates or any selected dealer
shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the Company or any of its affiliates in
connection with the Offering and the other transactions contemplated by this Agreement. Notwithstanding anything in this Agreement to
the contrary, the Company acknowledges that the Underwriters may have financial interests in the success of the Offering that are not
limited to the difference between the price to the public and the purchase price paid to the Company by the Underwriters for the shares
and the Underwriters have no obligation to disclose, or account to the Company for, any of such additional financial interests. The Company
hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with
respect to any breach or alleged breach of fiduciary duty.
4.14 Board
Composition and Board Designations. The Company shall ensure that: (i) the qualifications of the persons serving as board members
and the overall composition of the Board of Directors comply with the Xxxxxxxx-Xxxxx Act of 2002 and the rules promulgated thereunder
and with the listing requirements of the Trading Market and (ii) if applicable, at least one member of the Board of Directors qualifies
as a “financial expert” as such term is defined under the Xxxxxxxx-Xxxxx Act of 2002 and the rules promulgated thereunder.
4.15 Securities
Laws Disclosure; Publicity. At the request of the Representative, by 9:00 a.m. (New York City time) on the date hereof, the Company
shall issue a press release disclosing the material terms of the Offering. The Company and the Representative shall consult with each
other in issuing any other press releases with respect to the Offering, and neither the Company nor any Underwriter shall issue any such
press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release
of such Underwriter, or without the prior consent of such Underwriter, with respect to any press release of the Company, which consent
shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall
promptly provide the other party with prior notice of such public statement or communication. The Company will not issue press releases
or engage in any other publicity, without the Representative’s prior written consent, for a period ending at 5:00 p.m. (New
York City time) on the first business day following the 45th day following the Closing Date, other than normal and customary releases
issued in the ordinary course of the Company’s business.
4.16 Shareholder
Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Underwriter
of the Public Shares is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including
any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company,
or that any Underwriter of Public Shares could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving
Public Shares.
4.17 Reservation
of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all
times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the Company to issue Option
Shares pursuant to the Over-Allotment Option.
4.18 Listing
of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common Stock on the Trading
Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote all of the Closing
Shares and Option Shares on such Trading Market and promptly secure the listing of all of the Closing Shares and Option Shares on such
Trading Market. The Company further agrees, if the Company applies to have the Common Stock traded on any other Trading Market, it will
then include in such application all of the Closing Shares and Option Shares, and will take such other action as is necessary to cause
all of the Closing Shares and Option Shares to be listed or quoted on such other Trading Market as promptly as possible. The Company will
then take all action reasonably necessary to continue the listing and trading of its Common Stock on a Trading Market and will comply
in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market.
For so long as the Company maintains a listing or quotation of the Common Stock on a Trading Market, the Company agrees to maintain the
eligibility of the Common Stock for electronic transfer through the Depository Trust Company or another established clearing corporation,
including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation
in connection with such electronic transfer.
4.19 Subsequent
Equity Sales.
(a) From the date hereof until 180 days after the Closing Date, neither the Company nor any
Subsidiary shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common
Stock or Common Stock Equivalents.
(b) Notwithstanding
the foregoing, this Section 4.19 shall not apply in respect of an Exempt Issuance.
4.20 Research
Independence. The Company acknowledges that each Underwriter’s research analysts and research departments, if any, are required
to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and
that such Underwriter’s research analysts may hold and make statements or investment recommendations and/or publish research reports
with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company hereby waives and releases,
to the fullest extent permitted by law, any claims that the Company may have against such Underwriter with respect to any conflict of
interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be
different from or inconsistent with the views or advice communicated to the Company by such Underwriter’s investment banking divisions.
The Company acknowledges that the Representative is a full service securities firm and as such from time to time, subject to applicable
securities laws, may effect transactions for its own account or the account of its customers and hold long or short position in debt or
equity securities of the Company.
ARTICLE V.
DEFAULT BY UNDERWRITERS
If on the Closing Date or
any Option Closing Date, if any, any Underwriter shall fail to purchase and pay for the portion of the Closing Shares or Option Shares,
as the case may be, which such Underwriter has agreed to purchase and pay for on such date (otherwise than by reason of any default on
the part of the Company), the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters,
shall use their reasonable efforts to procure within 36 hours thereafter one or more of the other Underwriters, or any others, to purchase
from the Company such amounts as may be agreed upon and upon the terms set forth herein, the Closing Shares or Option Shares, as the case
may be, which the defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours the Representative shall not have
procured such other Underwriters, or any others, to purchase the Closing Shares or Option Shares, as the case may be, agreed to be purchased
by the defaulting Underwriter or Underwriters, then (a) if the aggregate number of Closing Shares or Option Shares, as the case may
be, with respect to which such default shall occur does not exceed 10% of the Closing Shares or Option Shares, as the case may be, covered
hereby, the other Underwriters shall be obligated, severally, in proportion to the respective numbers of Closing Shares or Option Shares,
as the case may be, which they are obligated to purchase hereunder, to purchase the Closing Shares or Option Shares, as the case may be,
which such defaulting Underwriter or Underwriters failed to purchase, or (b) if the aggregate number of Closing Shares or Option
Shares, as the case may be, with respect to which such default shall occur exceeds 10% of the Closing Shares or Option Shares, as the
case may be, covered hereby, the Company or the Representative will have the right to terminate this Agreement without liability on the
part of the non-defaulting Underwriters or of the Company except to the extent provided in Article VI hereof. In the event of a default
by any Underwriter or Underwriters, as set forth in this Article V, the applicable Closing Date may be postponed for such period,
not exceeding seven days, as the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters,
may determine in order that the required changes in the Prospectus or in any other documents or arrangements may be effected. The term
“Underwriter” includes any Person substituted for a defaulting Underwriter. Any action taken under this Section shall
not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
ARTICLE VI.
INDEMNIFICATION
6.1 Indemnification
of the Underwriters. Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless the Underwriters,
and each dealer selected by each Underwriter that participates in the offer and sale of the Public Shares (each a “Selected Dealer”)
and each of their respective directors, officers and employees and each Person, if any, who controls such Underwriter or any Selected
Dealer (“Controlling Person”) within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal
or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any
claim whatsoever, whether arising out of any action between such Underwriter and the Company or between such Underwriter and any third
party or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or
at common law or otherwise or under the laws of foreign countries, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in (i) any Preliminary Prospectus, if any, the Registration Statement or the Prospectus (as
from time to time each may be amended and supplemented); (ii) any materials or information provided to investors by, or with the
approval of, the Company in connection with the marketing of the offering of the Public Shares, including any “road show”
or investor presentations made to investors by the Company (whether in person or electronically); or (iii) any application or other
document or written communication (in this Article VI, collectively called “application”) executed by the Company
or based upon written information furnished by the Company in any jurisdiction in order to qualify the Public Shares under the securities
laws thereof or filed with the Commission, any state securities commission or agency, Trading Market or any securities exchange; or the
omission or alleged omission therefrom of 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, unless such statement or omission was made in reliance upon and
in conformity with written information furnished to the Company with respect to the applicable Underwriter by or on behalf of such Underwriter
expressly for use in any Preliminary Prospectus, if any, the Registration Statement or Prospectus, or any amendment or supplement thereto,
or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made
in the Preliminary Prospectus, if any, the indemnity agreement contained in this Section 6.1 shall not inure to the benefit of an
Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy of
the Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation
of sale of the Public Shares to such Person as required by the Securities Act and the rules and regulations thereunder, and if the
untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance
by the Company with its obligations under this Agreement. The Company agrees promptly to notify each Underwriter of the commencement of
any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue
and sale of the Public Shares or in connection with the Registration Statement or Prospectus.
6.2 Procedure.
If any action is brought against an Underwriter, a Selected Dealer or a Controlling Person in respect of which indemnity may be sought
against the Company pursuant to Section 6.1, such Underwriter, such Selected Dealer or Controlling Person, as the case may be, shall
promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including
the employment and fees of counsel (subject to the reasonable approval of such Underwriter or such Selected Dealer, as the case may be)
and payment of actual expenses. Such Underwriter, such Selected Dealer or Controlling Person shall have the right to employ its or their
own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter, such Selected Dealer
or Controlling Person unless (i) the employment of such counsel at the expense of the Company shall have been authorized in writing
by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel to have charge
of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to those available to the Company (in which case the Company shall not
have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable
fees and expenses of not more than one additional firm of attorneys selected by such Underwriter (in addition to local counsel), Selected
Dealer and/or Controlling Person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if any Underwriter,
Selected Dealer or Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve
the terms of any settlement of such action which approval shall not be unreasonably withheld.
6.3 Indemnification
of the Company. Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Company, its directors, officers
and employees and agents who control the Company within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to such
Underwriter, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any
Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any application,
in reliance upon, and in strict conformity with, written information furnished to the Company with respect to such Underwriter by or on
behalf of such Underwriter expressly for use in such Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment
or supplement thereto or in any such application. In case any action shall be brought against the Company or any other Person so indemnified
based on any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or any application,
and in respect of which indemnity may be sought against such Underwriter, such Underwriter shall have the rights and duties given to the
Company, and the Company and each other Person so indemnified shall have the rights and duties given to such Underwriter by the provisions
of this Article VI. Notwithstanding the provisions of this Section 6.3, no Underwriter shall be required to indemnify the Company
for any amount in excess of the underwriting discounts and commissions applicable to the Public Shares purchased by such Underwriter.
The Underwriters' obligations in this Section 6.3 to indemnify the Company are several in proportion to their respective underwriting
obligations and not joint.
6.4 Contribution.
(a) Contribution
Rights. In order to provide for just and equitable contribution under the Securities Act in any case in which (i) any Person
entitled to indemnification under this Article VI makes a claim for indemnification pursuant hereto but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Article VI
provides for indemnification in such case, or (ii) contribution under the Securities Act, the Exchange Act or otherwise may be required
on the part of any such Person in circumstances for which indemnification is provided under this Article VI, then, and in each such
case, the Company and each Underwriter, severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages
and expenses of the nature contemplated by said indemnity agreement incurred by the Company and such Underwriter, as incurred, in such
proportions that such Underwriter is responsible for that portion represented by the percentage that the underwriting discount appearing
on the cover page of the Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the
balance; provided, that, no Person guilty of a 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,
each director, officer and employee of such Underwriter or the Company, as applicable, and each Person, if any, who controls such Underwriter
or the Company, as applicable, within the meaning of Section 15 of the Securities Act shall have the same rights to contribution
as such Underwriter or the Company, as applicable. Notwithstanding the provisions of this Section 6.4, no Underwriter shall be required
to contribute any amount in excess of the underwriting discounts and commissions applicable to the Public Shares purchased by such Underwriter.
The Underwriters' obligations in this Section 6.4 to contribute are several in proportion to their respective underwriting obligations
and not joint.
(b) Contribution
Procedure. Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement
of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party
(“contributing party”), notify the contributing party of the commencement thereof, but the failure to so notify the
contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder.
In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative
of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the
notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking
contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written
consent of such contributing party. The contribution provisions contained in this Section 6.4 are intended to supersede, to the extent
permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available.
ARTICLE VII.
MISCELLANEOUS
7.1 Termination.
(a) Termination
Right. The Representative shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any
domestic or international event or act or occurrence has materially disrupted, or in its opinion will in the immediate future materially
disrupt, general securities markets in the United States; or (ii) if trading on any Trading Market shall have been suspended or materially
limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required
by FINRA or by order of the Commission or any other government authority having jurisdiction, or (iii) if the United States shall
have become involved in a new war or an increase in major hostilities, or (iv) if a banking moratorium has been declared by a New
York State or federal authority, or (v) if a moratorium on foreign exchange trading has been declared which materially adversely
impacts the United States securities markets, or (vi) if the Company shall have sustained a material loss by fire, flood, accident,
hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will,
in the Representative’s opinion, make it inadvisable to proceed with the delivery of the Public Shares, or (vii) if the Company
is in material breach of any of its representations, warranties or covenants hereunder, or (viii) if the Representative shall have
become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such adverse material
change in general market conditions as in the Representative’s judgment would make it impracticable to proceed with the offering,
sale and/or delivery of the Public Shares or to enforce contracts made by the Underwriters for the sale of the Public Shares.
(b) Expenses.
In the event this Agreement shall be terminated pursuant to Section 7.1(a), within the time specified herein or any extensions thereof
pursuant to the terms herein, the Company shall be obligated to pay to the Representative its actual and accountable out of pocket expenses
related to the transactions contemplated herein then due and payable, including the fees and disbursements of EGS, in an amount not to
exceed $20,000 (provided, however, that such expense cap in no way limits or impairs the indemnification and contribution
provisions of this Agreement).
(c) Indemnification.
Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether
or not this Agreement is otherwise carried out, the provisions of Article VI shall not be in any way effected by such election or
termination or failure to carry out the terms of this Agreement or any part hereof.
7.2 Entire
Agreement. The Transaction Documents, together with the exhibits and schedules thereto, the Prospectus and the Prospectus Supplement,
contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements
and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents,
exhibits and schedules. Notwithstanding anything herein to the contrary, the Engagement Agreement, dated January 25, 2023 (“Engagement
Agreement”), by and between the Company and the Representative, shall continue to be effective and the terms therein, provided
that in the event of a conflict between the terms of the Engagement Agreement and this Agreement, the terms of this Agreement shall prevail.
7.3 Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall
be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via
e-mail attachment at the email address set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City
time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered via
e-mail attachment at the e-mail address as set forth on the signature pages attached hereto on a day that is not a Trading Day or
later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date
of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached
hereto.
7.4 Amendments;
Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in
the case of an amendment, by the Company and the Representative. No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver
of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder
in any manner impair the exercise of any such right.
7.5 Headings.
The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any
of the provisions hereof.
7.6 Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.
7.7 Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts
of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts
sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting
in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably
waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such
court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an
Action or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under
Article VI, the prevailing party in such Action or Proceeding shall be reimbursed by the other party for its reasonable attorneys’
fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Action or Proceeding.
7.8 Survival.
The representations and warranties contained herein shall survive the Closing and the Option Closing, if any, and the delivery of the
Public Shares.
7.9 Execution.
This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that
the parties need not sign the same counterpart. In the event that any signature is delivered by e-mail delivery of a “.pdf”
format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such “.pdf” signature page were an original thereof.
7.10 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force
and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts
to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
7.11 Remedies.
In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, the Underwriters
and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may
not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby
agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would
be adequate.
7.12 Saturdays,
Sundays, Holidays, etc. If
the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business
Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
7.13 Construction.
The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents
and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party
shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference
to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse and forward stock splits,
stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.
7.14 WAIVER
OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT
PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE FOREVER ANY RIGHT TO TRIAL BY JURY.
(Signature Pages Follow)
If the foregoing correctly
sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among the Company and the several Underwriters in accordance with its terms.
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Very truly yours, |
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XXXXX THERAPEUTICS, INC. |
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By: |
/s/ Xxxx Xxxxx |
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Name: Xxxx Xxxxx |
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Title: President and Chief Executive Officer |
Address for Notice:
Copy to:
Accepted on the date first above written.
MAXIM GROUP LLC
As the Representative of the several
Underwriters listed on Schedule I
By: Maxim Group LLC
By: |
/s/ Xxxxxxxx X. Xxxxxx |
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Name: Xxxxxxxx X. Xxxxxx |
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Title: Co-President |
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Address for Notice:
000 Xxxx Xxxxxx
New York, NY 10022
Attention: Xxxxx Xxxxxx,
General Counsel
Email: xxxxxxx@xxxxxxxx.xxx
SCHEDULE I
Schedule
of Underwriters
Underwriters | |
Closing Shares | | |
Closing Purchase Price | |
Maxim Group LLC | |
| 1,050,000 | | |
$ | 5,126,625 | |
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Total | |
| 1,050,000 | | |
$ | 5,126,625 | |
Exhibit A
Form of Lock-Up Agreement