SUPER LEAGUE GAMING, INC. Up to US$75,000,000 of Common Stock EQUITY DISTRIBUTION AGREEMENT
Exhibit 1.3
Up to US$75,000,000 of Common Stock
September 3,
2021
Maxim Group
LLC
000 Xxxx
Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx
Xxxx 00000
Ladies and
Gentlemen:
Super League
Gaming, Inc., a Delaware corporation (the “Company”),
proposes to issue and sell through Maxim Group LLC (the
“Agent”), as
sales agent, common stock of the Company, par value $0.001 per
share (the “Common
Stock”), having an aggregate offering price of up to
US$75,000,000 of Common Stock (the Common Stock subject to this
Equity Distribution Agreement (this “Agreement”)
being referred to herein as the “Shares”) on
terms set forth herein. The Shares consist entirely of authorized
but unissued Common Stock to be issued and sold by the
Company.
The Company
hereby confirms its agreement with the Agent with respect to the
sale of the Shares.
1. Representations
and Warranties of the Company.
(a) The
Company represents and warrants to, and agrees with, the Agent as
follows:
(i) A
registration statement on Form S-3 (File No. 333-[ ]) (the
“registration
statement”) was initially declared effective by the
Securities and Exchange Commission (the “Commission”)
on [ ], 2021, and is currently effective, under the Securities Act
of 1933, as amended (the “Securities Act of
1933”), and the rules and regulations promulgated
thereunder (the “Rules and
Regulations” and collectively with the Securities Act
of 1933, the “Securities
Act”); since the date of effectiveness of the
registration statement, no additional or supplemental information
was requested by the Commission; no stop order of the Commission
preventing or suspending the use of any Base Prospectus (as defined
below), the Prospectus Supplement (as defined below), the
Prospectus (as defined below) or any Permitted Free Writing
Prospectus (as defined below), or the effectiveness of the
Registration Statement, has been issued, and no proceedings for
such purpose have been instituted or, to the Company’s
knowledge, are contemplated by the Commission. Except where the
context otherwise requires, “Registration
Statement,” as used herein, means the registration
statement, as amended at the time of such registration
statement’s effectiveness for purposes of Section 11 of the
Securities Act, as such section applies to the Agent, including (1)
all documents filed as a part thereof or incorporated or deemed to
be incorporated by reference therein, (2) any information contained
or incorporated by reference in a prospectus filed with the
Commission pursuant to Rule 424(b) under the Securities Act, to the
extent such information is deemed, pursuant to Rule 430B or Rule
430C under the Securities Act, to be part of the registration
statement at such time, and (3) any registration statement filed to
register the offer and sale of Shares pursuant to Rule 462(b) under
the Securities Act (the “462(b) Registration
Statement”). Except where the context otherwise
requires, “Base
Prospectus,” as used herein, means the prospectus
filed as part of the Registration Statement, together with any
amendments or supplements thereto as of the date of this Agreement.
Except where the context otherwise requires, “Prospectus
Supplement,” as used herein, means the most recent
prospectus supplement relating to the Shares, filed by the Company
with the Commission pursuant to Rule 424(b) under the Securities
Act and in accordance with the terms of this Agreement. Except
where the context otherwise requires, “Prospectus,”
as used herein, means the Prospectus Supplement together with the
Base Prospectus attached to or used with the Prospectus Supplement,
as may be amended or supplemented from time to time.
“Permitted Free Writing
Prospectus,” as used herein, means the documents, if
any, listed on Schedule
A attached hereto and, after the date hereof, any
“issuer free writing prospectus” as defined in Rule 433
of the Securities Act, that is expressly agreed to by the Company
and the Agent in writing to be a Permitted Free Writing Prospectus.
Any reference herein to the Registration Statement, the Base
Prospectus, the Prospectus Supplement, the Prospectus or any
Permitted Free Writing Prospectus shall be deemed to refer to and
include the documents, if any, incorporated by reference, or deemed
to be incorporated by reference, therein pursuant to Item 6 of Form
S-3 (the “Incorporated
Documents”), including, unless the context otherwise
requires, the documents, if any, filed as exhibits to such
Incorporated Documents. For purposes of this Agreement, all
references to the Registration Statement, the Rule 462(b)
Registration Statement, the Base Prospectus, the Prospectus or any
amendment or supplement to any of the
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foregoing shall be deemed
to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval System
(“XXXXX”). All
references in this Agreement to financial statements and schedules
and other information which is “described,”
“contained,” “included” or
“stated” in the Registration Statement, the Base
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
(or other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other
information which is incorporated by reference in or otherwise
deemed by the Rules and Regulations to be a part of or included in
the Registration Statement, the Base Prospectus, the Prospectus or
Permitted Free Writing Prospectus as the case may be. Any reference
herein to the terms “amend,”
“amendment” or
“supplement”
with respect to the Registration Statement, any Base Prospectus,
the Prospectus, the Prospectus Supplement or any Permitted Free
Writing Prospectus shall be deemed to refer to and include the
filing of any document under the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder (collectively,
the “Exchange Act”)
on or after the initial effective date of the Registration
Statement, or the date of such Base Prospectus, the Prospectus, the
Prospectus Supplement or such Permitted Free Writing Prospectus, if
any, as the case may be, and incorporated or deemed to be
incorporated therein by reference pursuant to Item 6 of Form S-3.
“Time of
Sale” means each time a Share is purchased pursuant to
this Agreement.
(ii) The
Registration Statement complied when it became effective, complies
as of the date hereof, and will comply upon the effectiveness of
any amendment thereto and at each Time of Sale and each Settlement
Date (as applicable), in all material respects, with the
requirements of the Securities Act; at all times during which a
prospectus is required by the Securities Act to be delivered
(whether physically or through compliance with Rule 172 under the
Securities Act or any similar rule) in connection with any sale of
Shares (the “Prospectus Delivery
Period”); the Registration Statement, as may be
amended, will comply, in all material respects, with the
requirements of the Securities Act; the conditions to the use of
Form S-3 in connection with the offering and sale of the Shares as
contemplated hereby (the “Offering”)
have been satisfied; the Registration Statement meets, and the
Offering complies with, the requirements of Rule 415 under the
Securities Act (including, without limitation, Rule 415(a)(5)); the
Registration Statement did not, as of the time of its effectiveness
and as of the date hereof, and will not, as of the effective date
of any amendment thereto, at each Time of Sale, if any, and at all
times during a Prospectus Delivery Period, contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading.
(A) The
Prospectus, as of the date of the Prospectus Supplement, as of the
date hereof (if filed with the Commission on or prior to the date
hereof), at each Settlement Date and Time of Sale (as applicable),
and at all times during a Prospectus Delivery Period, complied,
complies or will comply, in all material respects, with the
requirements of the Securities Act; and the Prospectus, and each
supplement thereto, as of their respective dates, at each
Settlement Date or Time of Sale (as applicable), and at all times
during a Prospectus Delivery Period, did not and will not include
an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
(B) Each
Permitted Free Writing Prospectus, if any, as of its date and as of
each Settlement Date and Time of Sale (as applicable), and at all
times during a Prospectus Delivery Period (when taken together with
the Prospectus at such time) will not include an untrue statement
of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not
misleading.
The
representations and warranties set forth in subparagraphs (A), (B)
and (C) above shall not apply to any statement contained in the
Registration Statement, any Base Prospectus, the Prospectus or any
Permitted Free Writing Prospectus in reliance upon and in
conformity with information concerning the Agent that is furnished
in writing by or on behalf of the Agent expressly for use in the
Registration Statement, such Base Prospectus, the Prospectus or
such Permitted Free Writing Prospectus, if any, it being understood
and agreed that only such information furnished by the Agent as of
the date hereof consists of the information described in
Section
5(b)(ii).
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(iii) Prior
to the execution of this Agreement, the Company has not, directly
or indirectly, offered or sold any Shares by means of any
“prospectus” (within the meaning of the Securities Act)
or used any “prospectus” (within the meaning of the
Securities Act) in connection with the Offering, in each case other
than the Base Prospectus or any Permitted Free Writing Prospectus;
the Company has not, directly or indirectly, prepared, used or
referred to any Permitted Free Writing Prospectus except in
compliance with Rules 164 and 433 under the Securities Act;
assuming that a Permitted Free Writing Prospectus, if any, is sent
or given after the Registration Statement was filed with the
Commission (and after such Permitted Free Writing Prospectus, if
any, was, if required pursuant to Rule 433(d) under the Securities
Act, filed with the Commission), the Company will satisfy the
provisions of Rule 164 or Rule 433 necessary for the use of a free
writing prospectus (as defined in Rule 405) in connection with the
Offering; the conditions set forth in one or more of subclauses (i)
through (iv), inclusive, of Rule 433(b)(1) under the Securities Act
are satisfied, and the registration statement relating to the
Offering, as initially filed with the Commission, includes a
prospectus that, other than by reason of Rule 433 or Rule 431 under
the Securities Act, satisfies the requirements of Section 10 of the
Securities Act; neither the Company nor the Agent is disqualified,
by reason of subsection (f) or (g) of Rule 164 under the Securities
Act, from using, in connection with the Offering, “free
writing prospectuses” (as defined in Rule 405 under the
Securities Act) pursuant to Rules 164 and 433 under the Securities
Act; the Company is not an “ineligible issuer” (as
defined in Rule 405 under the Securities Act) as of the eligibility
determination date for purposes of Rules 164 and 433 under the
Securities Act with respect to the offering of the Shares
contemplated by the Registration Statement; the parties hereto
agree and understand that the content of any and all “road
shows” (as defined in Rule 433 under the Securities Act)
related to the Offering is solely the property of the
Company.
(iv) Each
Permitted Free Writing Prospectus, as of its issue date, each Time
of Sale and each Settlement Date occurring after such issue date
and at all subsequent times through the Prospectus Delivery Period
(as defined below) or until any earlier date that the Company
notified or notifies the Agent as described in Section 3(c)(iii), did not,
does not and will not include any information that conflicted,
conflicts or will conflict with the information contained in the
Registration Statement, any Base Prospectus or the Prospectus. The
foregoing sentence does not apply to statements in or omissions
from any Permitted Free Writing Prospectus based upon and in
conformity with written information furnished to the Company by the
Agent specifically for use therein, it being understood and agreed
that only such information furnished by the Agent as of the date
hereof consist of the information described in Section 5(b)(ii).
(v) The
consolidated financial statements of the Company and the
Subsidiaries (as defined below), together with the related notes,
set forth or incorporated by reference in the Registration
Statement and the Prospectus comply in all material respects with
the requirements of the Securities Act and the Exchange Act and
fairly present in all material respects the financial condition of
the Company and the Subsidiaries, as a whole, as of the dates
indicated and the results of operations and changes in cash flows
for the periods therein specified in conformity with U.S. generally
accepted accounting principles consistently applied throughout the
periods involved. The selected financial data and the summary
financial information included in the documents in the Registration
Statement and in the Prospectus constitute a fair summary of the
information purported to be summarized and have been compiled on a
basis consistent with that of the audited financial statements
included in the Registration Statement. No other financial
statements or supporting schedules are required to be included or
incorporated by reference in the Registration Statement or the
Prospectus under the Securities Act except as so included or
incorporated by reference. All disclosures contained in the
Registration Statement or the Prospectus or incorporated by
reference therein regarding “non GAAP financial
measures” (as such term is defined by the applicable rules
and regulations of the Commission) comply with Regulation G of the
Exchange Act and Item 10 of Regulation S-K of the Securities Act to
the extent applicable. To the Company’s knowledge, Xxxxx
Xxxxx US, LLP, which has expressed its opinion with respect to the
audited financial statements for the fiscal year ended December 31,
2020, and schedules, if any, and which has reviewed the unaudited
financial statements for the three and six months ended June 30,
2021 (collectively, the “Incorporated Financial
Statements”), filed as a part of the Registration
Statement and included in the Registration Statement and the
Prospectus, are each a registered public accounting firm within the
meaning of the Securities Act, and in the performance of its work
for the Company has not been in violation of the auditor
independence requirements of the Xxxxxxxx-Xxxxx Act of 2002 (the
“Xxxxxxxx-Xxxxx
Act”).
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(vi) The
Company has been duly organized and is validly existing as a
corporation under the laws of its jurisdiction of incorporation.
The Company and each of the Subsidiaries has full corporate power
and authority to own its respective properties and conduct its
business as currently being carried on and as described in the
Registration Statement and the Prospectus, and is duly qualified to
do business as a foreign corporation in good standing in each
jurisdiction in which it owns or leases real property or in which
the conduct of its business makes such qualification necessary and
in which the failure to so qualify would have a material adverse
effect upon the results of operations, business, management,
properties, prospects, conditions (financial or otherwise) or
operations, of the Company and the Subsidiaries, either
individually or taken as a whole (“Material Adverse
Effect”).
(vii) Except
as disclosed in the Prospectus, subsequent to the dates as of which
information is given in the Prospectus, the Company (including its
Subsidiaries on a consolidated basis) has not incurred any material
liabilities or obligations, direct or contingent, or entered into
any material transactions, or declared or paid any dividends or
made any distribution of any kind with respect to the capital stock
of the Company; and there has not been any change in the capital
stock of the Company, or issuance of options, warrants, convertible
securities or other rights to purchase the capital stock of the
Company, or any material change in the short-term or long-term debt
of the Company (other than as a result of the exercise of any
currently outstanding options or warrants that are disclosed in the
Prospectus), or any Material Adverse Effect or any development that
would reasonably be expected to result in a Material Adverse
Effect. Since the date of the latest balance sheet presented in the
Registration Statement and the Prospectus, neither the Company nor
any Subsidiary has entered into any transactions, including any
acquisition or disposition of any business or asset, which are
material to the Company and the Subsidiaries taken as a whole,
except for transactions which are disclosed in the Registration
Statement and the Prospectus.
(viii) Except as set forth in the
Prospectus, there is not pending or, to the knowledge of the
Company, threatened or contemplated, any action, suit or proceeding
to which the Company or any of its Subsidiaries or of which any
property or assets of the Company or any of its Subsidiaries is the
subject before or by any court or governmental agency, authority or
body, or any arbitrator or mediator, which, individually or in the
aggregate, would reasonably be expected to result in any Material
Adverse Effect.
(ix) There
are no statutes, regulations, contracts or documents that are
required to be described in the Registration Statement and the
Prospectus or be filed as exhibits to the Registration Statement by
the Securities Act that have not been so described or
filed.
(x) This
Agreement has been duly authorized, executed and delivered by the
Company, and constitutes a valid, legal and binding obligation of
the Company, enforceable against the Company in accordance with its
terms, except as rights to indemnity hereunder may be limited by
federal or state securities laws and except as such enforceability
may be limited by bankruptcy, insolvency, reorganization or similar
laws affecting the rights of creditors generally and subject to
general principles of equity. The execution, delivery and
performance of this Agreement and the consummation of the
transactions herein contemplated will not result in a breach or
violation of any of the terms and provisions of, or constitute a
default under, (i) any law, rule or regulation to which the Company
or any of its Subsidiaries is subject, (ii) any agreement or
instrument to which the Company or any of its Subsidiaries or by
which it is bound or to which any of its property is subject, (iii)
the Company’s Second Amended and Restated Certificate of
Incorporation, as amended (the “Charter”), or
Second Amended and Restated Bylaws, or the organizational documents
of any of its Subsidiaries, or (iv) any order, rule, regulation or
decree of any court or governmental agency or body having
jurisdiction over the Company or any of its Subsidiaries or any of
its properties, except, in the case of clauses (i), (ii) and (iv),
for such breaches, violations or defaults that would not reasonably
be expected to result in a Material Adverse Effect; no consent,
approval, authorization or order of, or filing with, any court or
governmental agency or body is required for the execution, delivery
and performance of this Agreement or for the consummation of the
transactions contemplated hereby and thereby, including the
issuance or sale of the Shares by the Company, except for such
consents, approvals, authorizations, orders or filings as have been
obtained or made or as may be required under the Securities Act or
state securities or blue sky laws; and the Company has and will
have full power and authority to enter into this Agreement and to
authorize, issue and sell the Shares as contemplated hereby and
thereby.
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(xi) All
of the issued and outstanding shares of capital stock of the
Company, including the outstanding Common Stock, are duly
authorized and validly issued, fully paid and nonassessable, have
been issued in compliance with all applicable foreign, federal and
state securities laws, were not issued in violation of or subject
to any preemptive rights or other rights to subscribe for or
purchase securities that have not been waived in writing, and the
holders thereof are not subject to personal liability by reason of
being such holders; all of the issued and outstanding shares of
capital stock of each of the Subsidiaries are duly authorized and
validly issued, fully paid and nonassessable, and are owned by the
Company, directly or through wholly-owned Subsidiaries, free and
clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity except for those arising under any
credit facility or loan agreement (“Credit
Facilities”) to which the Company or any of its
Subsidiaries is a party or their assets are bound as disclosed in
the Registration Statement and the Prospectus, have been issued in
compliance with all applicable foreign, federal and state
securities laws, were not issued in violation of or subject to any
preemptive rights or other rights to subscribe for or purchase
securities that have not been waived in writing, and the holders
thereof are not subject to personal liability by reason of being
such holders; the Shares which may be sold under this Agreement by
the Company have been duly authorized and, when issued, delivered
and paid for in accordance with the terms of this Agreement will
have been validly issued and will be fully paid and nonassessable,
and the holders thereof will not be subject to personal liability
solely by reason of being such holders; and the capital stock of
the Company, including the Common Stock, conforms in all material
respects to the description thereof in the Registration Statement
and the Prospectus. Except as otherwise stated in the Registration
Statement and the Prospectus, there are no preemptive rights or
other rights to subscribe for or to purchase, or any restriction
upon the voting or transfer of, any Common Stock pursuant to the
Company’s Certificate of Incorporation, as amended, or any
agreement or other instrument to which the Company is a party or by
which the Company is bound. Neither the filing of the Registration
Statement nor the Offering gives rise to any rights for or relating
to the registration of any Common Stock or other securities of the
Company, except for such registration rights as have been duly
waived. Except as described in the Registration Statement and the
Prospectus, there are no options, warrants, agreements, contracts
or other rights in existence to purchase or acquire from the
Company any shares of the capital stock of the Company. The Company
has an authorized and outstanding capitalization as set forth in
the Registration Statement and the Prospectus as of the dates set
forth therein.
(xii) The
Company and each of its Subsidiaries holds, and is operating in
compliance with all grants, authorizations, licenses, permits,
consents, certificates and orders of any governmental or
self-regulatory body required for the conduct of its respective
businesses and all such grants, authorizations, licenses, permits,
consents, certifications and orders are valid and in full force and
effect, except for such noncompliance or failures to be in full
force and effect that would not reasonably be expected to result in
a Material Adverse Effect; and neither the Company nor any of its
Subsidiaries has received notice of any revocation or modification
of any such grant, authorization, license, permit, consent,
certification or order or has reason to believe that any such
grant, authorization, license, permit, consent, certification or
order will not be renewed in the ordinary course; and the Company
and each of its Subsidiaries is in compliance with all applicable
federal, state, local and foreign laws, regulations, orders and
decrees, except for such noncompliance that would not reasonably be
expected to result in a Material Adverse Effect. No approval,
authorization, consent or order of or filing with any foreign,
federal, state or local governmental or regulatory commission,
board, body, authority or agency is required in connection with the
issuance and sale of the Shares or the consummation by the Company
of the transactions contemplated hereby, other than (i)
registration of the Shares under the Securities Act, (ii) any
necessary qualification under the securities or blue sky laws of
the various jurisdictions in which the Shares are being offered by
the Agent, (iii) the filing of any reports under the Exchange Act,
(iv) such approvals as may be required by the Conduct Rules of the
Financial Industry Regulatory Authority, Inc. (“FINRA”), (v)
approval of the listing of the Shares by the NASDAQ Capital Market
or (vi) such approvals as have been obtained or made as of the Time
of Sale.
(xiii) The Company and each of its
Subsidiaries has good and marketable title to all property (whether
real or personal) described in the Registration Statement and the
Prospectus as being owned by it, in each case free and clear of all
liens, claims, security interests, other encumbrances or defects
except such as are described in the Registration Statement and the
Prospectus, except as would not materially impair the use or value
thereof. The property held under lease by the Company and each of
its Subsidiaries is held by it under valid, subsisting and
enforceable leases with only such exceptions with respect to any
particular lease as do not interfere in any material respect with
the conduct of the business of the Company or such
Subsidiary.
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(xiv) The
Company and each of its Subsidiaries owns, possesses, or can
acquire on reasonable terms, all Intellectual Property (as defined
below) necessary for the conduct of their respective businesses as
now conducted or as described in the Registration Statement and the
Prospectus to be conducted. Except as would not result in a
Material Adverse Effect, (A) there are no rights of third parties
to any such Intellectual Property owned by the Company, except as
otherwise disclosed to the Agent in writing by the Company prior to
the date hereof; (B) to the knowledge of the Company, there is no
infringement, misappropriation or violation by third parties of any
such Intellectual Property; (C) there is no pending or, to the
knowledge of the Company, threatened, action, suit, proceeding or
claim by others challenging the Company’s or any
Subsidiary’s rights in or to any such Intellectual Property,
and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (D) the Intellectual Property
owned by the Company and each of the Subsidiaries, and to the
knowledge of the Company, the Intellectual Property licensed to the
Company, each of the Subsidiaries, has not been adjudged invalid or
unenforceable, in whole or in part, and there is no pending or, to
the knowledge of the Company, threatened action, suit, proceeding
or claim by others challenging the validity or scope of any such
Intellectual Property, and the Company is unaware of any facts
which would form a reasonable basis for any such claim; (E) there
is no pending or, to the knowledge of the Company, threatened
action, suit, proceeding or claim by others that the Company or any
of its Subsidiaries infringes, misappropriates or otherwise
violates any Intellectual Property or other proprietary rights of
others, and neither the Company nor any of the Subsidiaries has
received any written notice of such claim; and (F) to the
Company’s knowledge, no employee of the Company or any of its
Subsidiaries is in or has ever been in violation of any term of any
employment contract, patent disclosure agreement, invention
assignment agreement, non-competition agreement, non-solicitation
agreement, nondisclosure agreement or any restrictive covenant to
or with a former employer where the basis of such violation relates
to such employee’s employment with the Company or any of its
Subsidiaries or actions undertaken by the employee while employed
with the Company or any of its Subsidiaries. “Intellectual
Property” shall mean all patents, patent applications,
trade and service marks, trade and service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets,
domain names, technology, know-how and other intellectual
property.
(xv) Neither
the Company nor any of its Subsidiaries is (A) in violation of its
Charter or similar organizational documents, or (B) in breach of or
otherwise in default, and no event has occurred which, with notice
or lapse of time or both, would constitute such a default in the
performance of any material obligation, agreement or condition
contained in any bond, debenture, note, indenture, loan agreement,
mortgage, deed of trust or any other material contract, lease or
other instrument to which it is subject or by which any of them may
be bound, or to which any of the material property or assets of the
Company or any of its Subsidiaries is subject (collectively, the
“Material
Contracts”); or (C) in violation of any law or statute
or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except in the
case of (B) and (C) above, as could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse
Effect.
(xvi) The
Company and each of the Subsidiaries has timely filed all
applicable federal, state, local, foreign and other income and
franchise tax returns required to be filed and are not in default
in the payment of any taxes which were payable pursuant to said
returns or any assessments with respect thereto, other than any
which the Company or any of its Subsidiaries is contesting in good
faith. There is no pending dispute with any taxing authority
relating to any of such returns, and the Company has no knowledge
of any proposed liability for any tax to be imposed upon the
properties or assets of the Company or any of its Subsidiaries for
which there is not an adequate reserve reflected in the
Company’s financial statements included in the Registration
Statement. There are no documentary, stamp or other issuance or
transfer taxes or duties or similar fees or charges under U.S.
federal law or the laws of any U.S. state, required to be paid in
connection with the execution and delivery of this Agreement or the
issuance, sale and delivery by the Company of the
Shares.
(xvii) The Company has not
distributed and will not distribute any prospectus or other
offering material in connection with the Offering other than the
Registration Statement and the Prospectus or other materials
permitted by the Securities Act to be distributed by the Company;
provided, however, that the Company has not made and will not make
any offer relating to the Shares that would constitute a
“free writing prospectus” as defined in Rule 405 under
the Securities Act, except in accordance with the provisions of
Section 3(p) of
this Agreement.
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(xviii) The issuance and sale of
the Shares as contemplated in this Agreement does not contravene
the rules and regulations of the NASDAQ Capital Market. The Common
Stock are registered pursuant to Section 12(b) of the Exchange Act
and are listed on the NASDAQ Capital Market and the Company has
taken no action designed to, or likely to have the effect of,
terminating the registration of the Common Stock under the Exchange
Act or delisting the Common Stock from the NASDAQ Capital Market
nor, except as disclosed in the Registration Statement or the
Prospectus, has the Company received any notification that the
Commission or the NASDAQ Capital Market is contemplating
terminating such registration or listing. The Company has complied
in all material respects with the applicable requirements of the
NASDAQ Capital Market for maintenance of the listing of the Common
Stock thereon. The Company has filed an application to include the
Shares on the NASDAQ Capital Market.
(xix) The
Company has no subsidiaries other than those described in the
Prospectus (collectively, the “Subsidiaries”).
The Company does not own, directly or indirectly, any shares of
stock or any other equity or long-term debt securities of any other
corporation or have any equity interest in any other corporation,
partnership, joint venture, association, trust or other
entity.
(xx) The
Company and each of its Subsidiaries have established and maintain
systems of internal accounting controls sufficient to provide
reasonable assurances that (A) transactions are executed in
accordance with management’s general or specific
authorization; (B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for
assets; (C) access to assets is permitted only in accordance with
management’s general or specific authorization; and (D)
amounts reflected on the Company’s consolidated balance sheet
for assets are compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any
differences. Except as described in the Registration Statement and
the Prospectus, since the filing of the annual report on Form 10-K
for the fiscal year ended December 31, 2020, there has been (i) no
new material weakness identified to the Company’s board of
directors (or committee thereof) in the Company’s internal
control over financial reporting (whether or not remediated) and
(ii) no change in the Company’s internal control over
financial reporting that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control
over financial reporting.
(xxi) Except
as described in the Registration Statement or the Prospectus, the
Company and each of the Subsidiaries: (A) is and at all times since
January 1, 2019 has been in material compliance with all United
States (federal, state and local) and foreign statutes, rules,
regulations, treaties, or guidance applicable to the Company or the
Subsidiaries (“Applicable
Laws”); (B) since January 1, 2019 has not received any
notice of adverse finding, warning letter, untitled letter or other
correspondence or notice from any Governmental Authority (as
defined below) alleging or asserting noncompliance with any
Applicable Laws or any licenses, certificates, approvals,
clearances, authorizations, permits and supplements or amendments
thereto required by any such Applicable Laws (“Authorizations”);
(C) since January 1, 2019 has not received notice of any claim,
action, suit, proceeding, hearing, enforcement, investigation,
arbitration or other action from any Governmental Authority or
third party alleging that any product operation or activity is in
violation of any Applicable Laws or Authorizations and has no
knowledge that any such Governmental Authority or third party
intends to assert any such claim, litigation, arbitration, action,
suit, investigation or proceeding; (D) since January 1, 2019 has
not received notice that any Governmental Authority has taken, is
taking or intends to take action to limit, suspend, modify or
revoke any Authorizations and the Company has no knowledge that any
such Governmental Authority is considering such action; and (E) has
filed, obtained, maintained or submitted all material reports,
documents, forms, notices, applications, records, claims,
submissions and supplements or amendments as required by any
Applicable Laws or Authorizations and that all such reports,
documents, forms, notices, applications, records, claims,
submissions and supplements or amendments were complete and correct
in all material respects on the date filed (or were corrected or
supplemented by a subsequent submission). “Governmental
Authority” means any federal, provincial, state,
local, foreign or other governmental or quasi-governmental agency
or body or any other type of regulatory authority or body,
including, without limitation, the NASDAQ Capital Market. The
aggregate of all pending legal or governmental proceedings to which
the Company or any Subsidiary is a party or of which any of their
respective property or assets is the subject which are not
described in the Registration Statement and the Prospectus,
including ordinary routine litigation incidental to the business,
would not result in a Material Adverse Effect.
(xxii) Other than as contemplated
by this Agreement and as set forth in that certain engagement
letter by and between the Company and Maxim, dated August 26, 2021
(the “Engagement
Letter”), the Company has not incurred any liability
for any finder’s or broker’s fee or agent’s
commission in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated
hereby. The Company has not entered into any other sales agency
agreements or other similar arrangements with any agent or any
other representative in respect of “at the market”
offerings of the Shares in accordance with Rule 415 under the
Securities Act.
-7-
(xxiii) The Company and each of the
Subsidiaries carries, or is covered by, insurance in such amounts
and covering such risks the Company reasonably believes are
adequate for the conduct of its respective business and the value
of its properties and as is customary for companies engaged in
similar businesses in similar industries; all policies of insurance
and any fidelity or surety bonds insuring the Company, each of its
Subsidiaries and their respective businesses, assets, employees,
officers and directors are in full force and effect; the Company
and each of its Subsidiaries is in compliance with the terms of
such policies and instruments in all material respects; there are
no claims by the Company or any of the Subsidiaries under any such
policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause;
neither the Company nor any of the Subsidiaries has been refused
any insurance coverage sought or applied for; and the Company has
no reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not have a Material
Adverse Effect.
(xxiv) The Company is not (and is
not an affiliate of), and immediately after receipt of payment for
the Shares, will not be (and will not be an affiliate of), an
“investment company” within the meaning of the
Investment Company Act of 1940, as amended. The Company currently
intends to conduct its business in a manner so that it will not
become subject to the Investment Company Act of 1940, as
amended.
(xxv) The
Incorporated Documents, at the time they were or hereinafter are
filed with the Commission, conformed and will conform in all
material respects to the requirements of the Securities Act and the
Exchange Act, and were filed on a timely basis with the Commission
and no Incorporated Document contained or will contain an untrue
statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
that, no representation is made herein regarding the
representations, warranties and covenants, or any descriptions
thereof, contained in any agreements or documents included as
exhibits to the Incorporated Documents. There is no material
document required to be described in the Registration Statement or
the Prospectus or to be filed as an exhibit to the Registration
Statement which was not described or filed as required. All
material agreements of the Company and all agreements governing or
evidencing any and all related party transactions have been filed
with the Commission to the extent required and applicable under the
Exchange Act. Neither the Company nor any Subsidiaries has sent or
received any communication regarding termination of, or intent not
to renew, any of the contracts or agreements referred to or
described in the Registration Statement and the Prospectus, or
referred to or described in, or filed as an exhibit to, the
Registration Statement or any Incorporated Document, and no such
termination or non-renewal has been threatened by the Company or
any of its Subsidiaries or, to the Company's knowledge, any other
party to any such contract or agreement. Any descriptions of the
terms of any of the foregoing contracts and agreements that are
contained in the Registration Statement and the Prospectus are
accurate and complete in all material respects.
(xxvi) The Company is in
compliance in all material respects with all applicable provisions
of the Xxxxxxxx-Xxxxx Act and the rules and regulations of the
Commission thereunder.
(xxvii) Except as described in the
Registration Statement and the Prospectus, the Company has
established and maintains disclosure controls and procedures
(within the meaning of Rule 13a-15(e) of the Exchange Act) and such
controls and procedures are designed to ensure that information
required to be disclosed in the reports that the Company files or
submits under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the rules and
forms of the Commission and that such information is accumulated
and communicated to the Company’s management, including its
Chief Executive Officer and Chief Financial Officer, as
appropriate, to allow timely decisions regarding required
disclosure. The Company has utilized such controls and procedures
in preparing and evaluating the disclosures in the Registration
Statement and the Prospectus.
(xxviii) To the knowledge of
the Company, neither the Company, the Subsidiaries, nor any
director, officer, agent, employee or affiliate of the Company or
any Subsidiary, has taken any action directly or indirectly, that
would result in a violation by such persons of the FCPA (as defined
below), including, without limitation, making use of the mails or
any means or instrumentality of interstate commerce corruptly in
furtherance of an offer, payment, promise to pay or authorization
of the payment of any money, or other property, gift, promise to
give, or authorization of the giving of anything of value to any
“Foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any
candidate for foreign political office, in contravention of the
FCPA, and the Company and each of its Subsidiaries has conducted
its business in compliance with the FCPA and has instituted and
maintains policies and procedures designed to ensure, and which are
reasonably expected to continue to ensure, continued compliance
therewith. “FCPA” means
the Foreign Corrupt Practices Act of 1977, as amended, and the
rules and regulations thereunder.
-8-
(xxix) The Company and each of its
Subsidiaries have complied in all material respects with the money
laundering statutes of applicable jurisdictions, the rules and
regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by
applicable governmental agencies (collectively, the
“Money
Laundering Laws”), and no action, suit or proceeding
by or before any court or governmental agency, authority or body or
any arbitrator involving the Company or any of its Subsidiaries
with respect to the Money Laundering Laws is pending or, to the
knowledge of the Company, threatened.
(xxx) Neither
the Company, any of its Subsidiaries, nor, to the knowledge of the
Company, any director, officer, employee, representative, agent, or
affiliate of the Company or any of its Subsidiaries is currently
subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Department of the Treasury.
(xxxi) No transaction has occurred
or agreement or understanding entered into between or among the
Company or any of its Subsidiaries on the one hand, and any
officer, director or 5% or greater stockholder of the Company or
any Subsidiary of the Company or any affiliate or affiliates of any
such officer, director or 5% or greater stockholder that is
required to be described that is not so described in the
Registration Statement and the Prospectus. Neither the Company nor
any of its Subsidiaries has, directly or indirectly, extended or
maintained credit, or arranged for the extension of credit, or
renewed an extension of credit, in the form of a personal loan to
or for any of its directors or executive officers in violation of
applicable laws, including Section 402 of the Xxxxxxxx-Xxxxx
Act.
(xxxii) (a) Neither the Company nor
any of its Subsidiaries is in violation of any applicable
international, national, state or local convention, law,
regulation, order, governmental license, convention, treaty
(including those promulgated by the International Maritime
Organization) or other requirement relating to pollution or
protection of human health or safety (as they relate to exposure to
Materials of Environmental Concern (as defined below)) or
protection of the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface
strata) or protection of natural resources, including without
limitation, conventions, laws or regulations relating to emissions,
discharges, releases or threatened releases of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous
substances, petroleum, petroleum products or other hydrocarbons
(collectively, “Materials of Environmental
Concern”), or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern
(collectively, “Environmental
Laws”), nor has the Company or any Subsidiary received
any written communication, whether from a Governmental Authority,
citizens group, employee or otherwise, that alleges that the
Company or any such Subsidiary is in violation of any Environmental
Law or governmental license required pursuant to Environmental Law;
except, in each case, as would not, individually or in the
aggregate, have a Material Adverse Effect; (b) there is no claim,
action or cause of action filed with a court or Governmental
Authority and no investigation, or other action with respect to
which the Company or any Subsidiary has received written notice
alleging potential liability for investigatory costs, cleanup
costs, governmental response costs, natural resources damages,
property damages, personal injuries, attorneys' fees or penalties
arising out of, based on or resulting from the presence, or release
into the environment, of any Material of Environmental Concern at
any location owned, leased or operated by the Company or any
Subsidiary, now or in the past, or from any vessel owned, leased or
operated by the Company or any Subsidiary, now or in the past
(collectively, “Environmental
Claim”), pending or, to the knowledge of the Company,
threatened against the Company or any Subsidiary or any person or
entity whose liability for any Environmental Claim the Company or
any Subsidiary has retained or assumed either contractually or by
operation of law, except as would not, individually or in the
aggregate, have a Material Adverse Effect; (c) to the knowledge of
the Company, there are no past or present actions, activities,
circumstances, conditions, events or incidents, including, without
limitation, the release, emission, discharge, presence or disposal
of any Material of Environmental Concern, that reasonably would be
expected to result in a violation of any Environmental Law, require
expenditures to be incurred pursuant to Environmental Law, or form
the basis of an Environmental Claim against the Company, any
Subsidiary or against any person or entity whose liability for any
Environmental Claim the Company or any Subsidiary has retained or
assumed either contractually or by operation of law, except as
would not, individually or in the aggregate, have a Material
Adverse Effect (for the avoidance of doubt, the operation of
vessels in the ordinary course of business shall not be deemed, by
itself, an action, activity, circumstance or condition set forth in
this clause (c)); and (d) none of the Company or any Subsidiary is
subject to any pending proceeding under Environmental Law to which
a Governmental Authority is a party and which the Company
reasonably believes is likely to result in monetary sanctions of
US$100,000 or more. The Company has reasonably concluded that any
existing compliance and remediation costs and liabilities arising
under Environmental Laws and resulting from the business,
operations or properties of the Company or any Subsidiary would
not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect, except as set forth in or
contemplated in the Registration Statement and the Prospectus. In
the ordinary course of its business, the Company conducts a
periodic review of the effect of Environmental Laws on the
business, operations and properties of the Company and the
Subsidiaries, in the course of which it identifies and evaluates
associated costs and liabilities (including, without limitation,
any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any
permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties). No
facts or circumstances have come to the Company's attention that
could result in costs or liabilities that could be expected,
individually or in the aggregate, to have a Material Adverse
Effect.
-9-
(xxxiii) The Company and
each of the Subsidiaries (A) is in compliance, in all material
respects, with applicable foreign, federal, state and local laws,
rules, regulations, statutes and codes promulgated by applicable
governmental authorities (including pursuant to the Occupational
Health and Safety Act) relating to the protection of human health
and safety in the workplace (“Occupational
Laws”); (B) has received all material permits,
licenses or other approvals required of it under applicable
Occupational Laws to conduct its business as currently conducted;
and (C) is in compliance, in all material respects, with all terms
and conditions of such permit, license or approval. No action,
proceeding, revocation proceeding, writ, injunction or claim is
pending or, to the Company’s knowledge, threatened against
the Company or any of its Subsidiaries relating to Occupational
Laws, and the Company does not have knowledge of any facts,
circumstances or developments relating to its operations or cost
accounting practices that could reasonably be expected to form the
basis for or give rise to such actions, suits, investigations or
proceedings.
(xxxiv) No material labor problem
or dispute with the employees of the Company or any of its
Subsidiaries exists or, to the knowledge of the Company, is
threatened or imminent.
(xxxv) The Company has not, and to
its knowledge no one acting on its behalf has, (a) taken, directly
or indirectly, any action designed to cause or to result in the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of any of the Shares, (b)
sold, bid for, purchased, or paid any compensation for soliciting
purchases of, any of the Shares or (c) paid or agreed to pay to any
person any compensation for soliciting another to purchase any
other securities of the Company, other than, in the case of clauses
(b) and (c), compensation paid to the Agent in connection with the
sale of the Shares.
(xxxvi) Other than the Agent, no
person or entity has the right to act as a placement agent,
underwriter or as a financial advisor in connection with the sale
of the Shares contemplated hereby, and the Company is not a party
to any agreement with an agent or underwriter for any other
“at the market” offering or continuous equity
transaction.
(xxxvii) There is no transaction,
arrangement or other relationship between the Company or any of its
Subsidiaries and an unconsolidated or other off balance sheet
entity that is required to be disclosed by the Company in the
Registration Statement or the Prospectus and is not so disclosed or
that otherwise could be reasonably likely to have a Material
Adverse Effect.
(xxxviii) None of the Company, its
Subsidiaries, or any of their respective affiliates, nor any person
or entity acting on their behalf (excluding the Agent) 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 the transactions contemplated by this Agreement to
require approval of stockholders of the Company under any
applicable stockholder approval provisions, including, without
limitation, under the rules and regulations of the NASDAQ Capital
Market. None of the Company, its Subsidiaries, their affiliates nor
any person or entity acting on their behalf will take any action or
steps that would cause the offering of any of the Shares to be
integrated with other offerings of securities of the
Company.
(xxxix) Any statistical and
market-related data included in the Registration Statement and the
Prospectus are based on or derived from sources that the Company
believes to be reliable and accurate and, to the extent required,
the Company has obtained the written consent to the use of such
data from such sources.
(xl) The
Registration Statement is not the subject of a pending proceeding
or examination under Section 8(d) or 8(e) of the Securities Act,
and the Company is not the subject of a pending proceeding under
Section 8A of the Securities Act in connection with the offering of
the Shares.
(xli) Except
as set forth in the Registration Statement or the Prospectus, the
Company and its 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 Charter or the
laws of the State of Delaware that is or could become applicable to
the purchasers of the Shares.
-10-
(xlii) There are no affiliations
with any FINRA member firm among the Company’s officers,
directors or, to the knowledge of the Company, any five percent
(5%) or greater stockholder of the Company, except as set forth in
the Registration Statement or the Prospectus.
(xliii) Neither the Company nor any
Subsidiary or any of their respective properties or assets has any
immunity from the jurisdiction of any court or from any legal
process (whether through service or notice, attachment prior to
judgment, attachment in aid of execution or otherwise) under the
laws of the United States or any political subdivisions
thereof.
(xliv) The Company is not a
“foreign private issuer” as defined in Rule 405
promulgated under the Securities Act.
(xlv) The
Company did not qualify as a “passive foreign investment
company” within the meaning of Section 1297 of the United
States Internal Revenue Code of 1986, as amended, for its most
recently completed taxable year, if any.
(xlvi) Each “forward-looking
statement” (within the meaning of Section 27A of the
Securities Act or Section 21E of the Exchange Act) contained in the
Registration Statement and the Prospectus has been made or
reaffirmed with a reasonable basis and has been disclosed in good
faith.
(xlvii) The interactive data in
eXtensible Business Reporting Language included or incorporated by
reference in the Registration Statement fairly presents the
information called for in all material respects and has been
prepared in accordance with the Commission's rules and guidelines
applicable thereto.
(b) Any
certificate signed by any officer of the Company and delivered to
the Agent or the Agent’s counsel shall be deemed a
representation and warranty by the Company to the Agent as to the
matters covered thereby.
(c) At
each Bringdown Date (as defined herein) and each Time of Sale, the
Company shall be deemed to have affirmed each representation and
warranty contained in or made pursuant to this Agreement as of such
date as though made at and as of such date (except that such
representations and warranties shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented relating to such Shares on such date).
2. Purchase,
Sale and Delivery of Shares.
(a) At
the Market Sales. On the basis of the representations,
warranties and agreements herein the Company agrees that, from time
to time during the term of this Agreement, on the terms and subject
to the conditions set forth herein, it may issue and sell through
the Agent, acting as sales agent, the Shares up to an aggregate
offering price of US$75,000,000; provided, however, that in no
event shall the Company issue or sell through the Agent such number
of Shares that (a) exceeds the number or dollar amount of Common
Stock registered on the Registration Statement, pursuant to which
the Offering is being made, (b) exceeds the number of authorized
but unissued Common Stock or (c) would cause the Company or the
offering of the Shares to not satisfy the eligibility and
transaction requirements for use of Form S-3 (including, if
applicable, General Instruction I.B.6 of Form S-3 (the lesser of
(a), (b) and (c), the “Maximum
Amount”)). Notwithstanding anything to the contrary
contained herein, the parties hereto agree that compliance with the
limitations set forth in this Section 2(a) on the number and
aggregate sales price of Shares issued and sold under this
Agreement shall be the sole responsibility of the Company and that
Agent shall have no obligation in connection with such compliance.
Notwithstanding the foregoing, the Company agrees that it will
provide the Agent with written notice no less than one (1) business
day prior to the date on which it makes the initial sale of Shares
under this Agreement. As used herein, the terms “business day”
means any day (other than Saturday, Sunday or any federal holiday
in the United States) in which commercial banks in New York, New
York are open for business.
(i) For
purposes of selling the Shares through the Agent, the Company
hereby appoints the Agent as exclusive agent of the Company for the
purpose of soliciting purchases of the Shares from the Company
pursuant to this Agreement and the Agent agrees to use its
commercially reasonable efforts to sell the Shares on the terms and
subject to the conditions stated herein.
-11-
(ii) Each
time the Company wishes to issue and sell the Shares hereunder
(each, a “Transaction”),
it will notify the Agent by telephone (confirmed promptly by
facsimile or e-mail to the appropriate individual listed on
Schedule D hereto,
using a form substantially similar to that set forth on
Schedule C hereto
(a “Transaction
Notice”) as to the maximum number of Shares to be sold
by the Agent on such day and in any event not in excess of the
amount available for issuance under the Prospectus and the
currently effective Registration Statement, the time period during
which sales are requested to be made, any limitation on the number
of shares that may be sold in any one Trading Day (as defined
below), and any minimum price below which sales may not be made.
The Transaction Notice shall originate from any of the individuals
from the Company set forth on Schedule B (with a copy to each
of the other individuals from the Company listed on such Schedule),
and shall be addressed to each of the individuals from the Agent
set forth on Schedule
D, as such Schedule
D may be amended from time to time. Subject to the terms and
conditions hereof and unless the sale of the Shares described
therein has been declined, suspended, or otherwise terminated in
accordance with the terms of this Agreement, the Agent shall
promptly acknowledge the Transaction Notice by facsimile or e-mail
(or by some other method mutually agreed to in writing by the
parties) and shall use its commercially reasonable efforts to sell
all of the Shares so designated by the Company in, and in accordance with the terms set forth
in, the Transaction Notice; provided, however, that any
obligation of the Agent to use such commercially reasonable efforts
shall be subject to the continuing accuracy of the representations
and warranties of the Company herein, to the performance by the
Company of its obligations hereunder and to the continuing
satisfaction of the additional conditions specified in Section 4 of this Agreement.
The gross sales price of the Shares sold under this Section 2(a) shall be equal to
the market price for the Common Stock sold by the Agent under this
Section 2(a) on the
NASDAQ Capital Market at the time of such sale. For the purposes
hereof, “Trading Day”
means any day on which Common Stock are purchased and sold on the
principal market on which the Common Stock are listed or
quoted.
(iii) The
Company or the Agent may, upon notice to the other party hereto by
telephone (confirmed promptly by facsimile or e-mail to the
respective individuals of the other party set forth on Schedule D hereto, which
confirmation shall be promptly acknowledged by the other party),
suspend the Offering for any reason and at any time, whereupon the
Agent shall so suspend the offering of Shares until further notice
is provided by the other party to the contrary; provided, however, that such suspension or
termination shall not affect or impair the parties’
respective obligations with respect to the Shares sold hereunder
prior to the receipt by the Agent of such notice. Each of the
parties agrees that no such notice under this Section 2(a)(iii) shall be
effective against the other unless it is made to one of the
individuals named on Schedule D hereto, as such
Schedule may be amended from time to time.
(iv) The
Company acknowledges and agrees that (A) there can be no assurance
that the Agent will be successful in selling the Shares, (B) the
Agent will incur no liability or obligation to the Company or any
other person or entity if it does not sell Shares for any reason
other than a failure by the Agent to use its commercially
reasonable efforts consistent with its normal trading and sales
practices and applicable law and regulations to sell such Shares as
required under this Agreement, and (C) the Agent shall be under no
obligation to purchase shares on a principal basis pursuant to this
Agreement.
(v) The
Agent may sell Shares by any method permitted by law to be an
“at the market offering” as defined in Rule 415 under
the Securities Act, including, without limitation, sales made
directly on the NASDAQ Capital Market, on any other existing
trading market for the Common Stock or to or through a market
maker. The Agent may also sell Shares in privately negotiated
transactions (which, for the avoidance of doubt, shall not include
block trades initiated on the NASDAQ Capital Market) with the Company’s prior written
approval.
(vi) The
compensation to the Agent for sales of the Shares, as an agent of
the Company, shall be a cash transaction fee equal to three percent
(3%) (the “Transaction
Fee”) of the gross sales price of all of Shares sold
pursuant to this Section
2(a) . The remaining proceeds, after further deduction for
any transaction or other fees imposed by any governmental or
self-regulatory organization in respect of such sales, shall
constitute the net proceeds to the Company for such Shares (the
“Net
Proceeds”). The Agent shall notify the Company as
promptly as practicable if any deduction referenced in the
preceding sentence will be required.
(vii) The
Agent shall provide written confirmation (which may be by facsimile
or electronic mail) to the Company following the close of trading
on the Nasdaq Capital Market each day in which the Shares are sold
under this Section
2(a) setting forth the number of the Shares sold on such
day, the aggregate gross sale proceeds, the Net Proceeds to the
Company, and the compensation payable by the Company to the Agent
with respect to such sales.
-12-
(viii) All Shares sold pursuant to
this Section 2(a)
will be delivered by the Company to Agent for the accounts of the
Agent on the second full business day following the date on which
such Shares are sold, or at such other time and date as Agent and
the Company determine pursuant to Rule 15c6-1(a) under the Exchange
Act, each such time and date of delivery being herein referred to
as a “Settlement
Date.” On each Settlement Date, the Shares sold
through the Agent for settlement on such date shall be issued and
delivered by the Company to the Agent against payment of the Net
Proceeds from the sale of such Shares. Settlement for all such
Shares shall be effected by free delivery of the Shares by the
Company or its transfer agent (i) to the Agent or its
designee’s account (provided the Agent shall have given the
Company written notice of such designee prior to the Settlement
Date) at The Depository Trust Company (“DTC”) or (ii)
by such other means of delivery as may be mutually agreed upon by
the parties hereto, which in all cases (provided that such Shares were sold
pursuant to the Registration Statement) shall be freely
tradable, transferable, registered shares in good deliverable form,
in return for payment in same day funds delivered to an account
designated by the Company. If the Company or its transfer agent (if
applicable) shall default on its obligation to deliver the Shares
on any Settlement Date, the Company shall (A) indemnify and hold
the Agent harmless against any loss, claim or damage arising from
or as a result of such default by the Company and (B) pay the Agent
any commission to which it would otherwise be entitled absent such
default against payment of the Net Proceeds therefor by wire
transfer of same day funds payable to the order of the Company at
9:00 a.m. New York City time. If the Agent breaches this Agreement
by failing to deliver the Net Proceeds on any Settlement Date for
the shares delivered by the Company, the Agent will pay the Company
interest based on the effective prime rate until such proceeds,
together with such interest, have been fully paid.
(ix) Under
no circumstances shall the Company cause or request the offer or
sale of any Shares if, after giving effect to the sale of such
Shares, the aggregate gross sales proceeds sold pursuant to this
Agreement would exceed the lesser of (A) together with all sales of
Shares under this Agreement, the Maximum Amount, (B) the amount
available for offer and sale under the currently effective
Registration Statement and (C) the amount authorized from time to
time to be issued and sold under this Agreement by the
Company’s board of directors, a duly authorized committee
thereof or a duly authorized executive committee, and notified to
the Agent in writing. Under no circumstances shall the Company
cause or request the offer or sale of any Shares at a price lower
than the minimum price authorized from time to time by the
Company’s board of directors, duly authorized committee
thereof or a duly authorized executive committee, and notified to
the Agent in writing. Further, under no circumstances shall the
aggregate offering amount of the Shares sold pursuant to this
Agreement, including any separate underwriting or similar agreement
covering principal transactions, exceed the Maximum
Amount.
(x) Unless
the exceptive provisions set forth in Rule 101(c)(1) of
Regulation M under the Exchange Act are satisfied with respect
to the Shares, the Company shall give the Agent at least one
business day’s prior notice of its intent to sell any Shares
in order to allow the Agent time to comply with Regulation
M.
(xi) The
Company agrees that during the term of this Agreement, any offer to
sell, any solicitation of an offer to buy, or any sales of Shares
in an “at the market offering” as defined in Rule 415
under the Securities Act, including pursuant to Section 3(o) of this Agreement,
shall only be effected by or through the Agent; provided, however,
that the foregoing limitation shall not apply to the exercise of
any outstanding option or warrant described in the Registration
Statement and the Prospectus.
(b) Nothing
herein contained shall constitute the Agent an unincorporated
association or partner with the Company. Under no circumstances
shall any Shares be sold pursuant to this Agreement after the date
which is three years after the Registration Statement is first
declared effective by the Commission.
(c) Notwithstanding
any other provisions of this Agreement, the Company agrees that no
sale of Shares shall take place, and the Company shall not request
the sale of any Shares, and the Agent shall not be obligated to
sell, during any period in which the Company is, or could be deemed
to be, in possession of material non-public information or the
Company’s xxxxxxx xxxxxxx policy would prohibit the purchase
and sale of the Company’s Common Stock by its officers and
directors.
-13-
3. Covenants.
The Company covenants and agrees with the Agent as
follows:
(a) After
the date hereof and through any Prospectus Delivery Period, prior
to amending or supplementing the Registration Statement (including
any Rule 462(b) Registration Statement), Base Prospectus, the
Prospectus or any Permitted Free Writing Prospectus, the Company
shall furnish to the Agent for review a copy of each such proposed
amendment or supplement, allow the Agent a reasonable amount of
time to review and comment on such proposed amendment or
supplement, and the Company shall not file any such proposed
amendment or supplement to which the Agent or counsel to the Agent
reasonably object; provided, that the foregoing shall not apply
with regards to the filing by the Company of any Form 10-K, Form
10-Q or other Incorporated Document. Subject to this Section 3(a), immediately
following execution of this Agreement, the Company will prepare a
prospectus supplement describing the selling terms of the Shares
hereunder, the plan of distribution thereof and such other
information as may be required by the Securities Act or the Rules
and Regulations or as the Agent and the Company may deem
appropriate, and if requested by the Agent, a Permitted Free
Writing Prospectus containing the selling terms of the Shares
hereunder and such other information as the Company and the Agent
may deem appropriate, and will file or transmit for filing with the
Commission, in accordance with Rule 424(b) or Rule 433, as the case
may be, copies of the Prospectus as supplemented and each such
Permitted Free Writing Prospectus.
(b) After
the date of this Agreement, the Company shall promptly advise the
Agent in writing (i) of the receipt of any comments of, or requests
for additional or supplemental information from, the Commission or
for any amendments or supplements to the Registration Statement,
the Base Prospectus, the Prospectus or any Permitted Free Writing
Prospectus (excluding any Incorporated Documents), (ii) of the time
and date of any filing of any post-effective amendment to the
Registration Statement or any amendment or supplement to any Base
Prospectus, the Prospectus or any Permitted Free Writing
Prospectus(excluding any Incorporated Documents), (iii) of the time
and date that any post-effective amendment to the Registration
Statement becomes effective, (iv) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereto or of any order
preventing or suspending its use or the use of any Base Prospectus,
the Prospectus or any Permitted Free Writing Prospectus, or (v) of
any proceedings to remove, suspend or terminate from listing or
quotation the Common Stock from any securities exchange upon which
it is listed for trading or included or designated for quotation,
or of the threatening or initiation of any proceedings for any of
such purposes. If the Commission shall enter any such stop order at
any time, the Company may terminate this Agreement. Additionally,
the Company agrees that it shall comply with the provisions of
Rules 424(b), 430B and 430C, as applicable, under the Securities
Act and will use its reasonable efforts to confirm that any filings
made by the Company under Rule 424(b), Rule 433 or Rule 462 were
received in a timely manner by the Commission (without reliance on
Rule 424(b)(8) or Rule 164(b)).
(c) From
the date hereof through the later of (A) the termination of this
Agreement and (B) the end of any applicable Prospectus Delivery
Period, the Company will comply with all requirements imposed upon
it by the Securities Act, as now and hereafter amended, and by the
Rules and Regulations, as from time to time in force, and by the
Exchange Act so far as necessary to permit the continuance of sales
of or dealings in the Shares as contemplated by the provisions
hereof, the Base Prospectus, the Prospectus and any Permitted Free
Writing Prospectus. If during any applicable Prospectus Delivery
Period any event occurs as a result of which the Base Prospectus,
the Prospectus, or any Permitted Free Writing Prospectus would
include an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the
light of the circumstances then existing, not misleading, or if
during any applicable Prospectus Delivery Period it is necessary or
appropriate in the opinion of the Company or its counsel or in the
reasonable opinion of the Agent or counsel to the Agent to amend
the Registration Statement or supplement the Base Prospectus, the
Prospectus or any Permitted Free Writing Prospectus, to comply with
the Securities Act or to file under the Exchange Act any document
which would be deemed to be incorporated by reference in the
Prospectus in order to comply with the Securities Act or the
Exchange Act, the Company will promptly notify Agent (or the Agent
will notify the Company, as applicable), and the Agent shall
suspend the offering and sale of any such Shares, and the Company
will amend the Registration Statement or supplement the Base
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
or file such document (at the expense of the Company) so as to
correct such statement or omission or effect such compliance within
the time period prescribed by the Securities Act or the Exchange
Act.
-14-
(i) In
case the Agent is required to deliver (whether physically or
through compliance with Rule 172 under the Securities Act or any
similar rule), in connection with the sale of the Shares, a
Prospectus after the nine-month period referred to in Section
10(a)(3) of the Securities Act, or after the time a post-effective
amendment to the Registration Statement is required pursuant to
Item 512(a) of Regulation S-K under the Securities Act, the Company
will prepare, at its expense, promptly upon request such amendment
or amendments to the Registration Statement and the Prospectus as
may be necessary to permit compliance with the requirements of
Section 10(a)(3) of the Securities Act or Item 512(a) of Regulation
S-K under the Securities Act, as the case may be. The Company shall
cause each amendment or supplement to any Base Prospectus or the
Prospectus to be filed with the Commission as required pursuant to
the applicable paragraph of Rule 424(b) of the Securities Act or,
in the case of any document which would be deemed to be
incorporated by reference therein, to be filed with the Commission
as required pursuant to the Exchange Act, within the time period
prescribed. The Company shall promptly notify the Agent if any
Material Contract is terminated or if the other party thereto gives
written notice of its intent to terminate any such Material
Contract.
(ii) If
at any time following issuance of a Permitted Free Writing
Prospectus there occurs an event or development as a result of
which such Permitted Free Writing Prospectus would conflict with
the information contained in the Registration Statement, the Base
Prospectus or the Prospectus, or would include an untrue statement
of a material fact or omitted or would omit to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances prevailing at that subsequent time, not
misleading, the Company promptly will notify the Agent and will
promptly amend or supplement, at its own expense, such Permitted
Free Writing Prospectus to eliminate or correct such conflict,
untrue statement or omission.
(d) The
Company shall use commercially reasonable efforts to take or cause
to be taken all necessary action to qualify the Shares for sale
under the securities laws of such jurisdictions as Agent reasonably
designates, if applicable, and to continue such qualifications in
effect so long as required for the distribution of the Shares,
except that the Company shall not be required in connection
therewith to qualify as a foreign corporation or to execute a
general consent to service of process in any state. The Company
shall promptly advise the Agent of the receipt by the Company of
any notification with respect to the suspension of the
qualification of the Shares for offer or sale in any jurisdiction
or the initiation or threatening of any proceeding for such
purpose.
(e) The
Company will furnish to the Agent and counsel for the Agent, to the
extent requested, copies of the Registration Statement, the Base
Prospectus, the Prospectus, any Permitted Free Writing Prospectus,
and all amendments and supplements to such documents, in each case
as soon as available and in such quantities as the Agent may from
time to time reasonably request.
(f) The
Company will make generally available to its security holders as
soon as practicable an earnings statement (which need not be
audited) covering a 12-month period that shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 of
the Rules and Regulations. If the Company makes any public
announcement or release disclosing its results of operations or
financial condition for a completed quarterly or annual fiscal
period (each, an “Earnings
Release”) and the Company has not yet filed an Annual
Report on Form 10-K or a Form 10-Q with respect to such
information, as applicable, then, prior to any sale of Shares, the
Company shall be obligated to (x) file a prospectus supplement with
the Commission under the applicable paragraph of Rule 424(b), which
prospectus supplement shall include the applicable financial
information or (y) file a Report on Form 8-K, which Form 8-K shall
include the applicable financial information.
(g) The
Company, whether or not the transactions contemplated hereunder are
consummated or this Agreement is terminated, will pay or cause to
be paid (i) all expenses (including stock or transfer taxes and
stamp or similar duties allocated to the respective transferees)
incurred in connection with the registration, issue, sale and
delivery of the Shares, (ii) all reasonable expenses and fees
(including, without limitation, fees and expenses of the
Company’s accountants and counsel) in connection with the
preparation, printing, filing, delivery, and shipping of the
Registration Statement (including the financial statements therein
and all amendments, schedules, and exhibits thereto), the Base
Prospectus, each Prospectus, any Permitted Free Writing Prospectus,
and any amendment thereof or supplement thereto, and the producing,
word-processing, printing, delivery, and shipping of this Agreement
and other closing documents, including Blue Sky Memoranda (covering
the states and other applicable jurisdictions) prepared by counsel,
if required, and including the cost to furnish copies of each
thereof to the Agent, (iii) all filing fees, (iv) listing fees, if
any, and (v) all other costs and expenses of the Company incident
to the performance of its obligations hereunder that are not
otherwise specifically provided for herein. The Company shall
reimburse the Agent upon request for its reasonable costs and
out-of-pocket expenses incurred in connection with this Agreement,
including the fees and disbursements of its legal counsel, not to
exceed (except in the case of legal fees and disbursements as
provided for below) US$30,000 without the approval of the Company
(such approval not to be unreasonably withheld). In addition, the
Company shall pay the Agent US$2,500 for its legal fees on each
Bringdown Date. All such reimbursements under this Agreement shall
be paid in U.S. dollars.
-15-
(h) The
Company will apply the net proceeds from the sale of the Shares in
the manner set forth under the caption “Use of
Proceeds” in the Base Prospectus, the Prospectus, and any
Permitted Free Writing Prospectus.
(i) The
Company will not, without (i) giving the Agent at least five
business days’ prior written notice specifying the nature of
the proposed sale and the date of such proposed sale and (ii) the
Agent’s suspending activity under this Agreement for such
period of time as requested by the Company or as deemed appropriate
by the Agent in light of the proposed sale, offer for sale, sell,
contract to sell, pledge, grant any option for the sale of, enter
into any transaction which is designed to, or might reasonably be
expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash
settlement or otherwise) by the Company or any Subsidiary, or
otherwise issue or dispose of, directly or indirectly (or publicly
disclose the intention to make any such offer, sale, pledge, grant,
issuance or other disposition), of any Common Stock or any
securities convertible into or exchangeable for, or any options or
rights to purchase or acquire, Common Stock, or permit the
registration under the Securities Act of any Common Stock, such
securities, options or rights, except for (i) the registration of
the Shares and the sales through the Agent pursuant to this
Agreement (ii) the registration of Common Stock issued or issuable
with respect to any currently outstanding options and warrants that
are described in the Registration Statement and the Prospectus and
(iii) a registration statement on Form S-8 relating to employee
benefit plans.
(j) The
Company shall not, at any time at or after the execution of this
Agreement, offer or sell any Shares by means of any
“prospectus” (within the meaning of the Securities
Act), or use any “prospectus” (within the meaning of
the Securities Act) in connection with the offer or sale of the
Shares, in each case other than the Prospectus or any Permitted
Free Writing Prospectus.
(k) Until
the termination of this Agreement, the Company will not take,
directly or indirectly, any action designed to or that would
constitute or that might reasonably be expected to cause or result
in, under the Exchange Act or otherwise, stabilization or
manipulation in violation of the Securities Act, the Exchange Act
or the rules and regulations thereunder of the price of any
security of the Company to facilitate the sale or resale of the
Shares or otherwise violate any provision of Regulation M under the
Exchange Act.
(l) The
Company will not incur any liability for any finder’s or
broker’s fee or agent’s commission in connection with
the execution and delivery of this Agreement or the consummation of
the transactions contemplated hereby or thereby, except as contemplated herein and/or in
accordance with the terms of the Engagement
Letter.
(m) During
any applicable Prospectus Delivery Period, the Company will file on
a timely basis with the Commission such periodic and current
reports as required by the Rules and Regulations.
(n) Except
as described in the Company’s annual report on Form 10-K for
the fiscal year ended December 31, 2020, the Company has maintained
and will maintain, such controls and other procedures, including
without limitation those required by Sections 302 and 906 of the
Xxxxxxxx-Xxxxx Act and the applicable regulations thereunder, that
are designed to ensure that information required to be disclosed by
the Company in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within
the time periods specified in the Commission’s rules and
forms, including without limitation, controls and procedures
designed to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the Exchange
Act is accumulated and communicated to the Company’s
management, including its principal executive officer and its
principal financial officer, or persons performing similar
functions, as appropriate to allow timely decisions regarding
required disclosure, to ensure that material information relating
to Company is made known to them by others within those
entities.
(o) Each
of the Company and Agent represent and agree that, neither the
Company nor the Agent has made or will make any offer relating to
the Shares that would constitute an “issuer free writing
prospectus,” as defined in Rule 433 under the Securities Act,
or that would otherwise constitute a “free writing
prospectus,” as defined in Rule 405 under the Securities Act,
required to be filed with the Commission other than a Permitted
Free Writing Prospectus. The Company represents that it has treated
or agrees that it will treat each Permitted Free Writing Prospectus
as an “issuer free writing prospectus,” as defined in
Rule 433, and has complied and will comply with the requirements of
Rule 433 applicable to any Permitted Free Writing Prospectus,
including timely Commission filing where required, legending and
record keeping.
-16-
(p) On
the date hereof and each date when the Company (A) amends or
supplements (other than a supplement to a Prospectus filed pursuant
to Rule 424(b) under the Securities Act relating solely to the
offering of securities other than the Shares ) the Registration
Statement or Prospectus by means of a post-effective amendment,
sticker, or supplement but not by means of incorporation of
documents by reference into the Registration Statement or the
Prospectus relating to the Shares, (B) files an annual report on
Form 10-K under the Exchange Act (including any Form 10-K/A
containing amended material financial information or a material
amendment to the previously filed Form 10-K) or (C) files a report
on Form 10-Q containing quarterly financial information that is
incorporated by reference in the Registration Statement and
Prospectus (each of the dates in (A) through (C) are referred to
herein as a “Bringdown
Date”), the Agent shall receive a favorable opinion of
Disclosure Law Group, a Professional Corporation, counsel for the
Company, dated as of a date within ten (10) days after the
applicable Bringdown Date, addressed to the Agent and modified as
necessary to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of
such opinions. With respect to this Section 3(p), in lieu of
delivering such opinions or letters for Bringdown Dates subsequent
to the date hereof, such counsel may furnish agent with a letter (a
“Reliance
Letter”) to the effect that Agent may rely upon a
prior opinion or letter delivered under this Section 3(p) to the same extent
as if it were dated the date of such letter (except that statement
in such prior opinion shall be deemed to relate to the Registration
Statement and the Prospectus as amended or supplemented as of the
date of such Reliance Letter); provided, however, the requirement
to provide opinions and letters under this Section 3(p) is hereby waived
for any Bringdown Date occurring at a time at which no Transaction
Notice is pending, which waiver shall continue until the earlier to
occur of the date the Company delivers a Transaction Notice
hereunder and the next occurring Bringdown Date. Notwithstanding
the foregoing, if the Company subsequently decides to sell Shares
following a Bringdown Date when the Company relied on such waiver
and did not provide Agent with opinions and letters under this
Section 3(p), then
before the Company delivers the Transaction Notice or Agent sells
any Shares, the Company shall cause Disclosure Law Group, a
Professional Corporation, to furnish to the Agent a written opinion
or Reliance Letter dated the date of the Transaction
Notice.
(q) On
the date hereof, and each date when the Company files an annual
report on Form 10-K, or a report on Form 10-Q containing quarterly
financial information that is incorporated by reference in the
Registration Statement and Prospectus, the Company shall cause
Xxxxx Xxxxx US, LLP, or other independent accountants satisfactory
to the Agent, to deliver to the Agent (x) a letter, dated as of a
date within ten (10) days after such date and addressed to Agent,
in form and substance satisfactory to Agent (the first such letter,
the “Initial Comfort
Letter”), confirming that they are independent public
accountants within the meaning of the Securities Act and are in
compliance with the applicable requirements relating to the
qualifications of accountants under Rule 2-01 of Regulation S-X of
the Commission, and stating the conclusions and findings of said
firm with respect to the financial information and other matters
and (y) a letter updating the Initial Comfort Letter with any
information that would have been included in the Initial Comfort
Letter had it been given on such date and as modified as necessary
to relate to the date of such letter (each such letter, a
“Bringdown Comfort
Letter”); provided,
however, the requirement to provide a Bringdown Comfort
Letter under this Section
3(q) is hereby waived for any Bringdown Date occurring at a
time at which no Transaction Notice is pending, which waiver shall
continue until the earlier to occur of the date the Company
delivers a Transaction Notice hereunder and the next occurring
Bringdown Date. Notwithstanding the foregoing, if the Company
subsequently decides to sell Shares following a Bringdown Date when
the Company relied on such waiver and did not provide Agent with a
Bringdown Comfort Letter under this Section 3(q), then before the
Company delivers the Transaction Notice or Agent sells any Shares,
the Company shall cause Xxxxx Xxxxx US, LLP, or other independent
accountants satisfactory to the Agent, to deliver to the Agent a
Bringdown Comfort Letter dated the date of the Transaction
Notice.
(r) On
the date hereof and each Bringdown Date, the Company shall furnish
to the Agent a certificate, dated as of a date within ten (10) days
after the applicable Bringdown Date and addressed to Agent, signed
by the chief executive officer and by the chief financial officer
of the Company, to the effect that:
(i) The
representations and warranties of the Company in this Agreement are
true and correct in all material respects as if made at and as of
the date of the certificate, and the Company has complied in all
material respects with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to
the date of the certificate;
(ii) No
stop order or other order suspending the effectiveness of the
Registration Statement or any part thereof or any amendment thereof
or the qualification of the Shares for offering or sale or notice
that would prevent use of the Registration Statement, nor
suspending or preventing the use of the Base Prospectus, the
Prospectus or any Permitted Free Writing Prospectus, has been
issued, and no proceeding for that purpose has been instituted or,
to the best of their knowledge, is contemplated by the Commission
or any state or regulatory body;
-17-
(iii) The
Shares to be sold on that date have been duly and validly
authorized by the Company and all corporate action required to be
taken for the authorization, issuance and sale of the Shares on
that date has been validly and sufficiently taken;
(iv) Subsequent
to the respective dates as of which information is given in the
Base Prospectus, the Prospectus or any Permitted Free Writing
Prospectus, as amended and supplemented, and except for pending
transactions disclosed therein, the Company has not incurred any
material liabilities or obligations, direct or contingent, or
entered into any material transactions, not in the ordinary course
of business, or declared or paid any dividends or made any
distribution of any kind with respect to its capital stock, and
there has not been any change in the capital stock or any issuance
of options, warrants, convertible securities or other rights to
purchase the capital stock (other than as a result of the exercise
of any currently outstanding options or warrants that are disclosed
in the Prospectus), or any material change in the short-term or
long-term debt, of the Company, or any Material Adverse Effect or
any development that would reasonably be likely to result in a
Material Adverse Effect (whether or not arising in the ordinary
course of business), or any material loss by strike, fire, flood,
earthquake, accident or other calamity, whether or not covered by
insurance, incurred by the Company; and
(v) Except
as stated in the Base Prospectus, the Prospectus, and any Permitted
Free Writing Prospectus, as amended and supplemented, there is not
pending, or, to the knowledge of the Company, threatened or
contemplated, any action, suit or proceeding to which the Company
is a party before or by any court or governmental agency, authority
or body, or any arbitrator, which would reasonably be likely to
result in any Material Adverse Effect; provided, however, the
requirement to provide a certificate under this Section 3(r) is hereby waived
for any Bringdown Date occurring at a time at which no Transaction
Notice is pending, which waiver shall continue until the earlier to
occur of the date the Company delivers a Transaction Notice
hereunder and the next occurring Bringdown Date. Notwithstanding
the foregoing, if the Company subsequently decides to sell Shares
following a Bringdown Date when the Company relied on such waiver
and did not provide Agent with a certificate under this
Section 3(r), then
before the Company delivers the Transaction Notice or Agent sells
any Shares, the Company shall provide Agent with a certificate
dated the date of the Transaction Notice.
(s) A
reasonable time prior to each Bringdown Date, the Company, if so
requested by the Agent, shall conduct a due diligence session, in
form and substance, satisfactory to the Agent, which shall include
representatives of the management and the accountants of the
Company.
(t) The
Company shall disclose in its annual report on Form 10-K and its
reports on Form 10-Q with quarterly financial information the
number of Shares sold through the Agent under this Agreement, the
Net Proceeds to the Company and the compensation paid by the
Company with respect to sales of the Shares pursuant to this
Agreement.
(u) The
Company shall ensure that there are at all times sufficient Common
Stock to provide for the issuance, free of any preemptive rights,
out of its authorized but unissued Common Stock, of the maximum
aggregate number of Shares authorized for issuance by the
Company’s board of directors pursuant to the terms of this
Agreement. The Company will use its reasonable best efforts to
cause the Shares to be listed on the NASDAQ Capital Market, and to
maintain such listing. The Company shall cooperate with Agent and
use its reasonable efforts to permit Shares to be eligible for
clearance and settlement through the facilities of
DTC.
(v) At
any time during the term of this Agreement, the Company will advise
the Agent promptly after it receives notice or obtains knowledge of
any information or fact that would alter or affect any opinion,
certificate, letter and other document provided to the Agent
pursuant to Section
3 herein.
(w) Subject
to compliance with any applicable requirements of Regulation M
under the Exchange Act and compliance with applicable securities
laws, the Company consents to the Agent trading in Common Stock for
the Agent’s own account and for the account of its clients
(in compliance with all applicable laws) at the same time as sales
of the Shares occur pursuant to this Agreement.
(x) If
to the knowledge of the Company, any condition set forth in
Section 4 of this
Agreement shall not have been satisfied on the applicable
Settlement Date, the Company will offer to any person who has
agreed to purchase the Shares on such Settlement Date from the
Company as the result of an offer to purchase solicited by the
Agent the right to refuse to purchase and pay for such
Shares.
-18-
(y) On
the date hereof and each Bringdown Date, the Company shall furnish
to the Agent an incumbency certificate, dated as of such date and
addressed to Agent, signed by the secretary of the
Company.
(z) Each
acceptance by the Company of an offer to purchase the Shares
hereunder shall be deemed to be an affirmation to the Agent that
the representations and warranties of the Company contained in or
made pursuant to this Agreement are true and correct as of the date
of such acceptance as though made at and as of such date, and an
undertaking that such representations and warranties will be true
and correct as of the Settlement Date for the Shares relating to
such acceptance, as though made at and as of such date (except that
such representations and warranties shall be deemed to relate to
the Registration Statement and the Prospectus as amended and
supplemented relating to such Shares).
(aa) The
Company shall ensure that there are at all times sufficient Common
Stock to provide for the issuance, free of any preemptive rights,
out of its authorized but unissued Common Stock or Common Stock
held in treasury, of the maximum aggregate number of Shares
authorized for issuance by the Company’s board of directors
pursuant to the terms of this Agreement.
(bb) During
any period when the delivery of a prospectus relating to the Shares
is required (including in circumstances where such requirement may
be satisfied pursuant to Rule 172, 173 or any similar rule) to be
delivered under the Securities Act, the Company will file all
documents required to be filed with the Commission pursuant to the
Exchange Act within the time periods required by the Exchange Act
and the regulations thereunder.
(cc) The
Company shall cooperate with Agent and use its reasonable efforts
to permit the Shares to be eligible for clearance and settlement
through the facilities of DTC.
(dd) The
Company will apply the Net Proceeds from the sale of the Shares in
the manner set forth in the Prospectus.
(ee) To
the extent that the Registration Statement is not available for the
sales of the Shares as contemplated by this Agreement, the Company
shall file a new registration statement with respect to any
additional shares of Common Stock necessary to complete such sales
of the Shares and shall cause such registration statement to become
effective as promptly as practicable. After the effectiveness of
any such registration statement, all references to
“Registration Statement” included in this Agreement
shall be deemed to include such new registration statement,
including all documents incorporated by reference therein pursuant
to Item 6 of Form S-3, and all references to “Base
Prospectus” included in this Agreement shall be deemed to
include the final form of prospectus, including all documents
incorporated therein by reference, included in any such
registration statement at the time such registration statement
became effective.
4. Conditions
of Agent’s Obligations. The obligations of the Agent
hereunder are subject to (i) the accuracy of, as of the date
hereof, each Bringdown Date, and each Time of Sale (in each case,
as if made at such date), and compliance with, all representations,
warranties and agreements of the Company contained herein, (ii) the
performance by the Company of its obligations hereunder and (iii)
the following additional conditions:
(a) If
the filing of the Prospectus, or any amendment or supplement
thereto, or any Permitted Free Writing Prospectus, is required
under the Securities Act or the Rules and Regulations, the Company
shall have filed the Prospectus (or such amendment or supplement)
or such Permitted Free Writing Prospectus with the Commission in
the manner and within the time period so required (without reliance
on Rule 424(b)(8) or Rule 164(b)); the Registration Statement shall
remain effective; no stop order suspending the effectiveness of the
Registration Statement or any part thereof, any Rule 462(b)
Registration Statement, or any amendment thereof, nor suspending or
preventing the use of the Base Prospectus, the Prospectus or any
Permitted Free Writing Prospectus shall have been issued; no
proceedings for the issuance of such an order shall have been
initiated or threatened; and any request of the Commission for
additional information (to be included in the Registration
Statement, the Base Prospectus, the Prospectus, any Permitted Free
Writing Prospectus or otherwise) shall have been complied with to
the Agent’s satisfaction.
(b) The
Agent shall not have advised the Company that the Registration
Statement, the Base Prospectus, the Prospectus, or any amendment or
supplement thereto, or any Permitted Free Writing Prospectus,
contains an untrue statement of fact which, in the Agent’s
opinion, is material, or omits to state a fact which, in the
Agent’s opinion, is material and is required to be stated
therein or is necessary to make the statements therein (i) with
respect to the Registration Statement, not misleading and (ii) with
respect to the Base Prospectus, the Prospectus or any Permitted
Free Writing Prospectus, in light of the circumstances under which
they were made, not misleading.
-19-
(c) Except
as set forth or contemplated in the Base Prospectus, the Prospectus
and any Permitted Free Writing Prospectus, subsequent to the
respective dates as of which information is given therein, the
Company shall not have incurred any material liabilities or
obligations, direct or contingent, or entered into any material
transactions, or declared or paid any dividends or made any
distribution of any kind with respect to its capital stock and
there shall not have been any change in the capital stock, or any
issuance of options, warrants, convertible securities or other
rights to purchase the capital stock (other than as a result of the
exercise of any currently outstanding options or warrants that are
disclosed in the Prospectus), or any material change in the
short-term or long-term debt, of the Company, or any Material
Adverse Effect or any development that would be reasonably likely
to result in a Material Adverse Effect (whether or not arising in
the ordinary course of business), or any material loss by strike,
fire, flood, earthquake, accident or other calamity, whether or not
covered by insurance, incurred by the Company, the effect of which,
in any such case described above, in the Agent’s judgment,
makes it impractical or inadvisable to offer or deliver the
Shares.
(d) The
Company shall have performed each of its obligations under
Section
3(q).
(e) The
Company shall have performed each of its obligations under
Section
3(r).
(f) The
Company shall have performed each of its obligations under
Section
3(s).
(g) FINRA
shall not have raised any objection to the fairness and
reasonableness of the terms and arrangements under this
Agreement.
(h) All
filings with the Commission required by Rule 424 under the
Securities Act to have been filed by the Settlement Date shall have
been made within the applicable time period prescribed for such
filing by Rule 424.
(i) The
Company shall have furnished to Agent and the Agent’s counsel
such additional documents, certificates and evidence as they may
have reasonably requested.
(j) Trading
in the Common Stock shall not have been suspended on the NASDAQ
Capital Market. The Shares shall have been listed and authorized
for trading on the NASDAQ Capital Market prior to the first
Settlement Date, and satisfactory evidence of such actions shall
have been provided to the Agent and its counsel, which may include
oral confirmation from a representative of the NASDAQ Capital
Market.
All such
opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are reasonably
satisfactory in form and substance to Agent and the Agent’s
counsel. The Company will furnish Agent with such conformed copies
of such opinions, certificates, letters and other documents as
Agent shall reasonably request.
5. Indemnification
and Contribution.
(a) The
Company agrees to indemnify and hold harmless the Agent and each of
the other Indemnified Parties (as defined below) from and against,
and pay on demand for, any losses, claims, damages, obligations,
penalties, judgments, awards, liabilities, costs, expenses and
disbursements, and any and all actions, suits, proceedings and
investigations in respect thereof and any and all legal and other
costs, expenses and disbursements in giving testimony or furnishing
documents in response to subpoena or otherwise (including, without
limitation, the costs, expenses and disbursements, as and when
incurred, of investigating, preparing, pursuing or defending any
such action, suit, proceeding or investigation (whether or not in
connection with litigation in which any Indemnified Party is a
party)) (collectively, “Losses”),
directly or indirectly, caused by, relating to, based upon, arising
out of , or in connection with this Agreement, including, without
limitation, any act or omission by the Agent in connection with its
acceptance of or the performance or non-performance of its
obligations under the Agreement, any breach by the Company of any
representation, warranty, covenant or agreement contained in the
Agreement (or in any instrument, document or agreement relating
thereto, including any agency agreement), or the enforcement by the
Agent of its rights under the Agreement or these indemnification
provisions, except to the extent that any such Losses are found in
a final judgment by a court of competent jurisdiction (not subject
to further appeal) to have resulted primarily and directly from the
gross negligence or willful misconduct of the Indemnified Party
seeking indemnification hereunder. The Company also agrees that no
Indemnified Party shall have any liability (whether direct or
indirect, in contract or tort or otherwise) to the Company for or
in connection with this Agreement for any other reason, except to
the extent that any such liability is found in a final judgment by
a court of competent jurisdiction (not subject to further appeal)
to have resulted primarily and directly from such Indemnified
Party’s gross negligence or willful misconduct This indemnity
agreement will be in addition to any liability that the Company
otherwise might have.
-20-
(i) These
indemnification provisions shall extend to the following persons
(collectively, the “Indemnified
Parties”): Maxim, its present and former affiliated
entities, managers, members, officers, employees, legal counsel,
agents and controlling persons (within the meaning of the federal
securities laws), and the officers, directors, partners,
stockholders, members, managers, employees, legal counsel, agents
and controlling persons of any of them. These indemnification
provisions shall be in addition to any liability which the Company
may otherwise have to any Indemnified Party.
(ii) If
any action, suit, proceeding or investigation is commenced, as to
which an Indemnified Party proposes to demand indemnification, it
shall notify the Company with reasonable promptness; provided, however, that any failure by an
Indemnified Party to notify the Company shall not relieve the
Company from its obligations hereunder except to the extent that
the Company is actually and materially prejudiced by such failure
to notify. An Indemnified Party shall have the right to retain
counsel of its own choice to represent it, and the fees, expenses
and disbursements of such counsel shall be borne by the Company.
Any such counsel shall, to the extent consistent with its
professional responsibilities, cooperate with the Company and any
counsel designated by the Company. The Company shall be liable for
any settlement of any claim against any Indemnified Party made with
the Company’s written consent. The Company shall not, without
the prior written consent of the Agent, settle or compromise any
claim, or permit a default or consent to the entry of any judgment
in respect thereof, unless such settlement, compromise or consent
(i) includes, as an unconditional term thereof, the giving by the
claimant to all of the Indemnified Parties of an unconditional
release from all liability in respect of such claim, and (ii) does
not contain any factual or legal admission by or with respect to an
Indemnified Party or an adverse statement with respect to the
character, professionalism, expertise or reputation of any
Indemnified Party or any action or inaction of any Indemnified
Party.
(iii) In
order to provide for just and equitable contribution, if a claim
for indemnification pursuant to these indemnification provisions is
made but it is found in a final judgment by a court of competent
jurisdiction (not subject to further appeal) that such
indemnification may not be enforced in such case, even though the
express provisions hereof provide for indemnification in such case,
then the Company shall contribute to the Losses to which any
Indemnified Party may be subject (i) in accordance with the
relative benefits received by the Company and its stockholders,
subsidiaries and affiliates, on the one hand, and the Indemnified
Party, on the other hand, and (ii) if (and only if) the allocation
provided in clause (i) of this sentence is not permitted by
applicable law, in such proportion as to reflect not only the
relative benefits, but also the relative fault of the Company, on
the one hand, and the Indemnified Party, on the other hand, in
connection with the statements, acts or omissions which resulted in
such Losses as well as any relevant equitable considerations. No
person found liable for a fraudulent misrepresentation shall be
entitled to contribution from any person who is not also found
liable for fraudulent misrepresentation. The relative benefits
received (or anticipated to be received) by the Company and its
stockholders, subsidiaries and affiliates shall be deemed to be
equal to the aggregate consideration payable or receivable by such
parties in connection with the transaction or transactions to which
the Agreement relates relative to the amount of fees actually
received by the Agent in connection with such transaction or
transactions. Notwithstanding the foregoing, in no event shall the
amount contributed by all Indemnified Parties exceed the amount of
fees previously received by the Agent pursuant to the
Agreement.
(b) The
Agent will indemnify and hold harmless the Company and its
affiliates and directors and each officer of the Company who signed
the Registration Statement and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act (the “Company Indemnified
Parties”) from and against any Losses to which the
Company or the Company Indemnified Parties may become subject,
under the Securities Act or otherwise (including in settlement of
any litigation, if such settlement is effected with the written
consent of the Agent), insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or omission or alleged untrue
statement or omission of a material fact contained in the
Registration Statement, any Base Prospectus, the Prospectus, or any
amendment or supplement thereto or any Permitted Free Writing
Prospectus, but only and solely to the extent that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, any Base
Prospectus, the Prospectus, or any amendment or supplement thereto,
or any Permitted Free Writing Prospectus in reliance upon and in
conformity with written information furnished to the Company by
Agent expressly for use in the preparation thereof, it being
understood and agreed that the only information furnished by the
Agent consists of the information described as such in Section 5(b)(ii) hereof, by the
Company in connection with investigating or defending against any
such loss, claim, damage, liability or action.
(i) The
Agent confirms and the Company acknowledges that as of the date
hereof no information has been furnished in writing to the Company
by or on behalf of the Agent specifically for inclusion in the
Registration Statement, any Base Prospectus, the Prospectus or any
Permitted Free Writing Prospectus.
-21-
(c) If
the indemnification provided for in this Section 5 is unavailable or
insufficient to hold harmless an indemnified party under subsection
(a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of
the losses, claims, damages or liabilities referred to in
subsection (a) or (b) above, (i) in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and the Agent on the other from the
Offering or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to
in clause (i) above but also the relative fault of the Company on
the one hand and the Agent on the other in connection with the
statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on
the one hand and the Agent on the other shall be deemed to be in
the same proportion as the total net proceeds from the Offering
(before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Agent, bear
to the total public offering price of the Shares. The relative
fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Agent and the
parties’ relevant intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or
omission. The Company and the Agent agree that it would not be just
and equitable if contributions pursuant to this subsection (c) were
to be determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable
considerations referred to in the first sentence of this subsection
(c). The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first
sentence of this subsection (c) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending against any
action or claim which is the subject of this subsection (c).
Notwithstanding the provisions of this subsection (c), the Agent
shall not be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by
it and distributed to the public were offered to the public exceeds
the amount of any damages that the Agent has otherwise been
required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent
misrepresentation.
(d) Neither
termination of this Agreement nor completion of the Offering shall
affect these indemnification provisions which shall remain
operative and in full force and effect. The indemnification
provisions shall be binding upon the Company and the Agent and
their respective successors and assigns and shall inure to the
benefit of the Indemnified Parties and the Company Indemnified
Parties and their respective successors, assigns, heirs and
personal representatives.
6. Representations
and Agreements to Survive Delivery. All representations and
warranties of the Company herein or in certificates delivered
pursuant hereto, and agreements of the Agent and the Company
herein, including but not limited to the agreements of the Agent
and the Company contained in Section 5 hereof, shall remain
operative and in full force and effect regardless of any
investigation made by or on behalf of the Agent or any controlling
person thereof, or the Company or any of its officers, directors,
or controlling persons, and shall survive delivery of, and payment
for, the Shares to and by the Agent hereunder.
7. Termination
of this Agreement.
(a) The
Company shall have the right, by giving written notice as
hereinafter specified, to terminate the provisions of this
Agreement relating to the solicitation of offers to purchase the
Shares in its sole discretion at any time upon thirty (30)
days’ prior written notice. Any such termination shall be
without liability of any party to any other party except that (i)
if the Shares have been sold through the Agent for the Company,
then Sections 3(g),
3(o) and
3(y) shall remain
in full force and effect, (ii) with respect to any pending sale,
through the Agent for the Company, the obligations of the Company
with respect to such pending sale of Shares, including in respect
of compensation of the Agent, shall remain in full force and effect
notwithstanding such termination and (iii) the provisions of
Section 2(a)(vi),
Section 3(g),
Section 3(o),
Section 5 and
Section 6 of this
Agreement shall remain in full force and effect notwithstanding
such termination.
(b) The
Agent shall have the right, by giving written notice as hereinafter
specified, to terminate the provisions of this Agreement if the
Agent is not fully satisfied, in its sole discretion, with the
results of its and its representatives’ review of the Company
and the Company’s business. Any such termination shall be
without liability of any party to any other party except that (i)
the provisions of the last three sentences of Section 3(g) and the entirety
of Section 3(o),
Section 5 and
Section 6 of this
Agreement shall remain in full force and effect notwithstanding
such termination and (ii) the provisions of Section 3(g) other than the
last three sentences thereof shall remain in full force and effect
only if the Agent has terminated this Agreement as a result of the
Company’s default of its obligations hereunder and its
failure to cure any default within a reasonable period of
time.
-22-
(c) This
Agreement shall remain in full force and effect for twelve (12)
months from the date hereof unless terminated pursuant to
Sections 7(a) or
(b) above or
otherwise by mutual agreement of the parties; provided that any
such termination by mutual agreement shall in all cases be deemed
to provide that Section
3(g), Section
3(o), Section
5 and Section
6 shall remain in full force and effect. This Agreement
shall terminate automatically upon the issuance and sale of Shares
having an aggregate offering price equal to the amount set forth in
the first paragraph of this Agreement.
(d) Any
termination of this Agreement shall be effective on the date
specified in such notice of termination; provided that such
termination shall not be effective until the close of business on
the date of receipt of such notice by the Agent or the Company, as
the case may be. If such termination shall occur prior to the
Settlement Date for any sale of the Shares, such sale shall settle
in accordance with the provisions of Section 2(a) of this
Agreement.
8. Default
by the Company. If the Company shall fail at any Settlement
Date to sell and deliver the number of Shares which it is obligated
to sell hereunder, then this Agreement shall terminate without any
liability on the part of the Agent or, except as provided in
Section 3(g)
hereof, any non-defaulting party. No action taken pursuant to this
Section 8 shall
relieve the Company from liability, if any, in respect of such
default, and the Company shall (A) hold the Agent harmless against
any loss, claim or damage arising from or as a result of such
default by the Company and (B) pay the Agent any commission to
which it would otherwise be entitled absent such
default.
9. Notices.
Except as otherwise provided herein, all communications under this
Agreement shall be in writing and, if to the Agent, shall be
mailed, delivered or sent by facsimile or email transmission
to:
Maxim Group
LLC
000 Xxxx
Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx
Xxxx 00000
Attention:
Xxxxxxxx X. Xxxxxx, Executive Managing Director, Head of Investment
Banking
Fax: (000)
000-0000
email:
with a required
copy (which shall not constitute notice) to:
Xxxxx Xxxxxxx
LLP
0 Xxxxx
Xxxxxx
Xxx Xxxx, Xxx
Xxxx 00000
Attention: M.
Xxx Xxxxxxxx, Esq.
Fax: (000)
000-0000
Email:
Notices to the
Company shall be given to it at:
0000 Xxxxxxxx
Xxx., Xxxxx #000
Xxxxx Xxxxxx,
Xxxxxxxxxx 00000
Attention:
Xxx Xxxx
Email:
with a required
copy (which shall not constitute notice) to:
Disclosure Law
Group, a Professional Corporation
000 Xxxx
Xxxxxxxx, Xxxxx 000,
Xxx Xxxxx,
Xxxxxxxxxx 00000
Attn: Xxxxxxx
X. Xxxxxxxx, Esq.
Fax: (000)
000-0000
Email:
Any party to
this Agreement may change such address for notices by sending to
the parties to this Agreement written notice of a new address for
such purpose.
-23-
10. Persons
Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their
respective successors and assigns and the controlling persons,
officers and directors referred to in Section 5. Nothing in this
Agreement is intended or shall be construed to give to any other
person, firm or corporation any legal or equitable remedy or claim
under or in respect of this Agreement or any provision herein
contained. The term “successors and assigns” as herein
used shall not include any purchaser, as such purchaser, of any of
the Shares from the Agent.
11. Absence
of Fiduciary Relationship. The Company acknowledges and
agrees that: (a) the Agent has been retained solely to act as an
sales agent and/or principal in connection with the sale of the
Shares and that no fiduciary, advisory or agency relationship
between the Company and the Agent has been created in respect of
any of the transactions contemplated by this Agreement,
irrespective of whether the Agent has advised or are advising the
Company on other matters; (b) the price and other terms of the
Shares set forth in this Agreement were established by the Company
following discussions and arms-length negotiations with the Agent
and the Company is capable of evaluating and understanding and
understands and accepts the terms, risks and conditions of the
transactions contemplated by this Agreement; (c) it has been
advised that the Agent and its affiliates are engaged in a broad
range of transactions which may involve interests that differ from
those of the Company and that the Agent has no obligation to
disclose such interest and transactions to the Company by virtue of
any fiduciary, advisory or agency relationship; (d) it has been
advised that the Agent is acting, in respect of the transactions
contemplated by this Agreement, solely for the benefit of the
Agent, and not on behalf of the Company; and (e) it waives to the
fullest extent permitted by law, any claims it may have against the
Agent for breach of fiduciary duty or alleged breach of fiduciary
duty in respect of any of the transactions contemplated by this
Agreement and agrees that the Agent shall have no liability
(whether direct or indirect) to the Company in respect of such a
fiduciary duty claim on behalf of or in right of the Company,
including stockholders, employees or creditors of the
Company.
12. Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, including
Section 5-1401 of the General Obligations Law of the State of New
York, but otherwise without regard to conflict of laws rules that
would apply the laws of any other jurisdiction.
13. Counterparts.
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts
shall each be deemed to be an original and all such counterparts
shall together constitute one and the same instrument.
14. Adjustments
for Stock Splits. The parties acknowledge and agree that all
share-related numbers contained in this Agreement shall be adjusted
to take into account any stock split, stock dividend or similar
event effected with respect to the Shares.
15. Entire
Agreement; Amendment; Severability; Headings. This Agreement
(including all schedules and exhibits attached hereto and
transaction notices issued pursuant hereto) constitutes the entire
agreement and supersedes all other prior and contemporaneous
agreements and undertakings, both written and oral, among the
parties hereto with regard to the subject matter hereof. Neither
this Agreement nor any term hereof may be amended except pursuant
to a written instrument executed by the Company and the Agent. In
the event that any one or more of the provisions contained herein,
or the application thereof in any circumstance, is held invalid,
illegal or unenforceable as written by a court of competent
jurisdiction, then such provision shall be given full force and
effect to the fullest possible extent that it is valid, legal and
enforceable, and the remainder of the terms and provisions herein
shall be construed as if such invalid, illegal or unenforceable
term or provision was not contained herein, but only to the extent
that giving effect to such provision and the remainder of the terms
and provisions hereof shall be in accordance with the intent of the
parties as reflected in this Agreement. The section headings used
in this Agreement are for convenience only and shall not affect the
construction hereof.
16. Waiver
of Jury Trial. Each of the Company and the Agent hereby
waives any right it may have to a trial by jury in respect of any
claim based upon or arising out of this Agreement or the
transactions contemplated hereby.
-24-
17. Submission
to Jurisdiction. The Company irrevocably submits to the
non-exclusive jurisdiction of any New York State or United States
federal court sitting in The City of New York, Borough of
Manhattan, over any suit, action or proceeding arising out of or
relating to this Agreement, the Prospectus, the Registration
Statement, or the offering of the Shares. The Company irrevocably
waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of venue of any such
suit, action or proceeding brought in such a court and any claim
that any such suit, action or proceeding brought in such a court
has been brought in an inconvenient forum. To the extent that the
Company has or hereafter may acquire any immunity (on the grounds
of sovereignty or otherwise) from the jurisdiction of any court or
from any legal process with respect to itself or its property, the
Company irrevocably waives, to the fullest extent permitted by law,
such immunity in respect of any such suit, action or proceeding
including without limitation, any immunity pursuant to the U.S.
Foreign Sovereign Immunities Act of 1976, as amended. Each of the Agent and the Company further agrees
to accept and acknowledge service of any and all process which may
be served in any such suit, action or proceeding in the Supreme
Court of the State of New York, New York County, or in the United
States District Court for the Southern District of New York and
agrees that service of process upon the Company mailed by certified
mail or delivered by Federal Express via overnight delivery to the
Company’s address shall be deemed in every respect effective
service of process upon the Company in any such suit, action or
proceeding, and service of process upon the Agent mailed by
certified mail or delivered by Federal Express via overnight
delivery to the Agent’s address shall be deemed in every
respect effective service of process upon such Agent in any such
suit, action or proceeding.
[Signature Page
Follows]
-25-
If the
foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company the enclosed
duplicate of this Sales Agreement, whereupon this letter and your
acceptance shall represent a binding agreement between the Company
and the Agent in accordance with its terms.
|
|
Very truly
yours,
By:
/s/ Xxx
Xxxx
Name: Xxx Xxxx
Title: Chief Executive Officer
|
Confirmed as of
the date first
above
mentioned.
MAXIM GROUP
LLC
By: /s/ Xxxxxxxx X.
Xxxxxx
Name:
Xxxxxxxx X. Xxxxxx
Title:
Executive Managing Director,
Head of Investment Banking
-26-
Schedule A
Permitted Free
Writing Prospectus
None.
A-1
|
|
Schedule B
Individuals
Permitted to Authorize Sales of Shares
●
●
B-1
|
|
Schedule C
Form of
Transaction Notice
To:
Maxim Group LLC
Subject:
Transaction Notice
Date:
[●], 202__
Ladies and
Gentlemen:
Pursuant to the
terms and subject to the conditions contained in the Sales
Agreement between Super League Gaming, Inc. (the
“Company”),
and Maxim Group LLC (“Agent”),
dated September 3, 2021, the Company hereby requests that the Agent
sell up to [●] of the Company’s common stock, par value
$0.001 per share, at a minimum market price of $[●] per
share, during the time period beginning [month, day, time] and
ending [month, day, time].
C-1
Schedule D
Individual to
Which Notice Can Be Given
Maxim Group
LLC
●
Xxxx Xxxxxx
●
Xxxxxx Xxxxxx
D-1
