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AT THE MARKET OFFERING AGREEMENT

April 9, 2019

 

 

H.C. Wainwright & Co., LLC, as Lead Manager

430 Park Avenue, 4th Floor

New York, New York, USA, 10022

 

The Co-Managers set forth the signature page hereto

 

Ladies and Gentlemen:

 

Uranium Energy Corp., a corporation organized under the laws of Nevada (the
“Company”), confirms its agreement (this “Agreement”) with H.C. Wainwright &
Co., LLC (the “Lead Manager”) and the co-managers set forth on the signature
page attached hereto (each, a “Co-Manager” and collectively with the Lead
Manager, the “Managers”) as follows:

 

1.Definitions. The terms that follow, when used in this Agreement and any Terms
Agreement, shall have the meanings indicated. 

 

“Accountants” shall have the meaning ascribed to such term in Section 4(m).

 

“Act” shall mean the United States Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.

 

“Action” shall have the meaning ascribed to such term in Section 3(q).

 

“Affiliate” shall have the meaning ascribed to such term in Section 3(p).

 

“Applicable Time” shall mean, with respect to any Shares, the time of sale of
such Shares pursuant to this Agreement or any relevant Terms Agreement.

 

“Base Prospectus” shall mean the base prospectus contained in the Registration
Statement at the Execution Time.

 

“Board” shall have the meaning ascribed to such term in Section 2(b)(iii).

 

“Broker Fee” shall have the meaning ascribed to such term in Section 2(b)(v).

 

“Business Day” shall mean any day other than a Saturday, a Sunday or a legal
holiday or a day on which banking institutions or trust companies are authorized
or obligated by law to close in New York City.

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“Commission” shall mean the United States Securities and Exchange Commission.

 

“Common Stock” shall have the meaning ascribed to such term in Section 2.

 

“Common Stock Equivalents” shall have the meaning ascribed to such term in
Section 3(g).

 

“Company Counsel” shall have the meaning ascribed to such term in Section 4(l).

 

“Designated Manager” shall have the meaning ascribed to such term in Section
2(b)(i).

 

“DTC” shall have the meaning ascribed to such term in Section 2(b)(vii).

 

“Effective Date” shall mean each date and time that the Registration Statement
and any post-effective amendment or amendments thereto became or becomes
effective.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.

 

“Execution Time” shall mean the date and time that this Agreement is executed
and delivered by the parties hereto.

 

“Filing Date” shall have the meaning ascribed to such term in Section 4(w).

 

“Free Writing Prospectus” shall mean a free writing prospectus, as defined in
Rule 405.

 

“GAAP” shall have the meaning ascribed to such term in Section 3(n).

 

“Incorporated Documents” shall mean the documents or portions thereof filed with
the Commission on or before the Effective Date that are incorporated by
reference in the Registration Statement or the Prospectus and any documents or
portions thereof filed with the Commission after the Effective Date that are
deemed to be incorporated by reference in the Registration Statement or the
Prospectus.

 

“Intellectual Property Rights” shall have the meaning ascribed to such term in
Section 3(v).

 

“Issuer Free Writing Prospectus” shall mean an issuer free writing prospectus,
as defined in Rule 433.

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“Losses” shall have the meaning ascribed to such term in Section 7(d).

 

“Material Adverse Effect” shall have the meaning ascribed to such term in
Section 3(b).

 

“Material Permits” shall have the meaning ascribed to such term in Section 3(t).

 

“Net Proceeds” shall have the meaning ascribed to such term in Section 2(b)(v).

 

“Permitted Free Writing Prospectus” shall have the meaning ascribed to such term
in Section 4(g).

 

“Placement” shall have the meaning ascribed to such term in Section 2(c).

 

“Proceeding” shall have the meaning ascribed to such term in Section 3(b).

 

“Prospectus” shall mean the Base Prospectus, as supplemented by the most
recently filed Prospectus Supplement (if any).

 

“Prospectus Supplement” shall mean each prospectus supplement relating to the
Shares prepared and filed pursuant to Rule 424(b) from time to time.

 

“Registration Statement” shall mean the shelf registration statement (File
Number 333-215444) on Form S-3, including exhibits and financial statements and
any prospectus supplement relating to the Shares that is filed with the
Commission pursuant to Rule 424(b) and deemed part of such registration
statement pursuant to Rule 430B, as amended on each Effective Date and, in the
event any post-effective amendment thereto becomes effective, shall also mean
such registration statement as so amended, and includes any 462(b) Registration
Statement.

 

“Representation Date” shall have the meaning ascribed to such term in Section
4(k).

 

“Required Approvals” shall have the meaning ascribed to such term in Section
3(e).

 

“Rule 158”, “Rule 163”, “Rule 164”, “Rule 172”, “Rule 173”, “Rule 405”,
“Rule 415”, “Rule 424”, “Rule 430B” and “Rule 433” refer to such rules under the
Act.  

 

“Rule 462(b) Registration Statement” means any registration statement prepared
by the Company registering additional Shares, which was filed with the
Commission on or prior to the date hereof and became automatically effective

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pursuant to Rule 462(b) promulgated by the Commission pursuant to the Securities
Act.

 

“Sales Notice” shall have the meaning ascribed to such term in Section 2(b)(i).

 

“SEC Reports” shall have the meaning ascribed to such term in Section 3(m).

 

“Settlement Date” shall have the meaning ascribed to such term in Section
2(b)(vii).

 

“Subsidiary” shall have the meaning ascribed to such term in Section 3(a).

 

“Terms Agreement” shall have the meaning ascribed to such term in Section 2(a).

 

“Time of Delivery” shall have the meaning ascribed to such term in Section 2(c).

 

“Trading Day” means a day on which the Trading Market is open for trading.

 

“Trading Market” means NYSE American LLC.

 

2.Sale and Delivery of Shares. The Company proposes to issue and sell through or
to the Managers, as sales agent and/or principal, up to $37,901,840 of shares
(the “Shares”) of the Company’s common stock, $0.001 par value (“Common Stock”),
from time to time during the term of this Agreement and on the terms set forth
herein; provided, however, that in no event shall the Company issue or sell
through the Managers, in the aggregate, such number of Shares that (a) exceeds
the number or dollar amount of shares of Common Stock registered on the
Registration Statement, pursuant to which the offering is being made, (b)
exceeds the number of authorized but unissued shares of 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 Registration Statement on Form S-3 (the
lesser of (a), (b) and (c), the “Maximum Amount”)).  Notwithstanding anything to
the contrary contained herein, the parties hereto agree that compliance with the
limitations set forth in this Section 2 on the number and aggregate sales price
of Shares issued and sold under this Agreement shall be the sole responsibility
of the Company and that the Managers shall have no obligation in connection with
such compliance. 

 

(a)Appointment of Managers as Selling Agent; Terms Agreement.  For purposes of
selling the Shares through the Managers, the Company hereby appoints the
Managers as exclusive agents of the Company for the purpose of selling the
Shares of the Company pursuant to this Agreement and the Managers agree to use  

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their respective commercially reasonable efforts to sell the Shares on the terms
and subject to the conditions stated herein. In using commercially reasonable
efforts to sell Shares, as sales agent for the Company, each Manager will
undertake such sales in a manner that is consistent with its respective normal
trading and sales practices and applicable state, provincial and federal laws,
rules and regulations and the rules of the Trading Market. The Company agrees
that the sales of Shares hereunder shall only be effected by or through one
Manager on any single given Trading Day, and the Company shall not deliver a
Sales Notice (as defined below) to more than one Manager on any same Trading
Day.  The Company agrees that, whenever it determines to sell the Shares
directly to a Manager as principal, the Company will enter into a separate
agreement (each, a “Terms Agreement”) in substantially the form of Annex I
hereto, relating to such sale in accordance with Section 2 of this Agreement.

 

(b)Agent Sales.  Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company will issue and
agrees to sell Shares from time to time through a Manager, acting as sales
agent, and each Manager agrees, severally and not jointly with the other
Managers, to use its commercially reasonable efforts to sell, as sales agent for
the Company, on the following terms:  

 

(i)The Shares are to be sold on a daily basis or otherwise as shall be agreed to
by the Company and a Manager selected by the Company (such Manager, the
“Designated Manager”) on any day that (A) is a Trading Day, (B) the Company has
instructed the Designated Manager by telephone (confirmed promptly by electronic
mail) to make such sales (“Sales Notice”) and (C) the Company has satisfied its
obligations under Section 6 of this Agreement.  The Company will designate the
maximum amount of the Shares to be sold by the Designated Manager daily (subject
to the limitations set forth in Section 2(d)) and the minimum price per Share at
which such Shares may be sold. Subject to the terms and conditions hereof, the
Designated Manager shall use its commercially reasonable efforts to sell on a
particular day all of the Shares designated for the sale by the Company on such
day. The gross sales price of the Shares sold under this Section 2(b) shall be
the market price for shares of the Company’s Common Stock sold by the Designated
Manager under this Section 2(b) on the Trading Market at the time of sale of
such Shares. 

 

(ii)The Company acknowledges and agrees that (A) there can be no assurance that
the Designated Manager will be successful in selling the Shares, (B) the
Designated Manager will incur no liability or obligation to the Company or any
other person or entity if it does not sell the Shares for any reason other than
a failure by the Designated Manager to use its commercially reasonable efforts
consistent with its normal trading and sales practices and applicable law and
regulations to sell such Shares as required under this Agreement, and (C) the
Designated Manager shall be under no  

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obligation to purchase Shares on a principal basis pursuant to this Agreement,
except as otherwise specifically agreed by the Designated Manager and the
Company pursuant to a Terms Agreement.

 

(iii)The Company shall not authorize the issuance and sale of, and the
Designated Manager shall not be obligated to use its commercially reasonable
efforts to sell, any Shares at a price lower than the minimum price therefor
designated from time to time by the Company’s Board of Directors (the “Board”),
or a duly authorized committee thereof, or such duly authorized officers of the
Company, and notified to the Designated Manager in writing. The Company or the
Designated Manager may, upon notice to the other party hereto by telephone
(confirmed promptly by electronic mail), suspend the offering of the Shares for
any reason and at any time; provided, however, that such suspension or
termination shall not affect or impair the parties’ respective obligations with
respect to the Shares sold hereunder prior to the giving of such notice. 

 

(iv)The Designated Manager may sell Shares by any method permitted by law deemed
to be an “at the market offering” as defined in Rule 415 under the Act,
including without limitation sales made directly on the Trading Market, on any
other existing trading market for the Common Stock or to or through a market
maker.  The Designated Manager may also sell Shares in privately negotiated
transactions, provided that the Designated Manager receives the Company’s prior
written approval for any sales in privately negotiated transactions and if so
provided in the “Plan of Distribution” section of the Prospectus Supplement or
another Prospectus Supplement filed for such negotiated transaction. 

 

(v)The compensation to the Designated Manager for sales of the Shares under this
Section 2(b) shall be a placement fee of 2.25% of the gross sales price of the
Shares sold pursuant to this Section 2(b) (“Broker Fee”). The foregoing rate of
compensation shall not apply when the Designated Manager acts as principal, in
which case the Company may sell Shares to the Designated Manager as principal at
a price agreed upon at the relevant Applicable Time pursuant to a Terms
Agreement. The remaining proceeds, after deduction of the Broker Fee and
deduction for any transaction fees imposed by any clearing firm, execution
broker, or governmental or self-regulatory organization in respect of such
sales, shall constitute the net proceeds to the Company for such Shares (the
“Net Proceeds”). 

 

(vi)The Designated Manager shall provide written confirmation (which may be by
facsimile or electronic mail) to the Company following the close of trading on
the Trading Market each day in which the Shares are sold under this Section 2(b)
setting forth the number of the Shares sold on such day, the aggregate gross
sales proceeds and the Net Proceeds to the  

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Company, and the compensation payable by the Company to the Designated Manager
with respect to such sales.

 

(vii)Unless otherwise agreed between the Company and the Designated Manager,
settlement for sales of the Shares pursuant to Section 3(b) will occur at 10:00
a.m. (New York City time) on the second (2nd) Trading Day (or such earlier day
as is industry practice for regular-way trading) following the date on which
such sales are made (each, a “Settlement Date”). On or before the Trading Day
prior to each Settlement Date, the Company will, or will cause its transfer
agent to, electronically transfer the Shares being sold by crediting the
Designated Manager’s or its designee’s account (provided that the Designated
Manager shall have given the Company written notice of such designee at least
one Trading Day prior to the Settlement Date) at The Depository Trust Company
(“DTC”) through its Deposit or Withdrawal at Custodian System or by such other
means of delivery as may be mutually agreed upon by the Company and the
Designated Manager, which Shares in all cases shall be freely tradable, freely
transferable, registered shares in good deliverable form. On each Settlement
Date, the Designated Manager will deliver the related Net Proceeds in same day
funds to an account designated by the Company on or prior to the Settlement
Date. The Company agrees that, if the Company, or its transfer agent (if
applicable), defaults in its obligation to deliver duly authorized Shares on a
Settlement Date, in addition to and in no way limiting the rights and
obligations set forth in Section 7 hereto, the Company will (i) hold the
Designated Manager harmless against any loss, claim, damage, or reasonable,
documented expense (including reasonable and documented legal fees and
expenses), as incurred, arising out of or in connection with such default by the
Company, and (ii) pay to the Designated Manager any commission, discount or
other compensation to which the Designated Manager would otherwise have been
entitled absent such default.  

 

(viii)At each Applicable Time, Settlement Date, Representation Date and Filing
Date, the Company shall be deemed to have affirmed each representation and
warranty contained in this Agreement as if such representation and warranty were
made as of such date, modified as necessary to relate to the Registration
Statement and the Prospectus as amended as of such date. Any obligation of the
Designated Manager to use its commercially reasonable efforts to sell the Shares
on behalf of the Company shall be subject to the continuing accuracy of the
representations and warranties of the Company herein, to the performance by the
Company of its obligations hereunder and to the continuing satisfaction of the
additional conditions specified in Section 6 of this Agreement.  

 

(c)Term Sales.  If the Company wishes to sell the Shares pursuant to this
Agreement but other than as set forth in Section 3(b) of this Agreement (each,  

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a “Placement”), the Company will notify the Designated Manager of the proposed
terms of such Placement. If the Designated Manager, acting as principal, wishes
to accept such proposed terms (which it may decline to do for any reason in its
sole discretion) or, following discussions with the Company wishes to accept
amended terms, the Designated Manager and the Company will enter into a Terms
Agreement setting forth the terms of such Placement. The terms set forth in a
Terms Agreement will not be binding on the Company or the Designated Manager
unless and until the Company and the Designated Manager have each executed such
Terms Agreement accepting all of the terms of such Terms Agreement. In the event
of a conflict between the terms of this Agreement and the terms of a Terms
Agreement, the terms of such Terms Agreement will control.  A Terms Agreement
may also specify certain provisions relating to the reoffering of such Shares by
the Designated Manager. The commitment of the Designated Manager to purchase the
Shares pursuant to any Terms Agreement shall be deemed to have been made on the
basis of the representations and warranties of the Company herein contained and
shall be subject to the terms and conditions herein set forth. Each Terms
Agreement shall specify the number of the Shares to be purchased by the
Designated Manager pursuant thereto, the price to be paid to the Company for
such Shares, any provisions relating to rights of, and default by, underwriters
acting together with the Designated Manager in the reoffering of the Shares, and
the time and date (each such time and date being referred to herein as a “Time
of Delivery”) and place of delivery of and payment for such Shares. Such Terms
Agreement shall also specify any requirements for opinions of counsel,
accountants’ letters and officers’ certificates pursuant to Section 6 of this
Agreement and any other information or documents required by the Designated
Manager.

 

(d)Maximum Number of Shares.  Under no circumstances shall the Company cause or
request the offer or sale of any Shares if, after giving effect to the sale of
such Shares, the aggregate amount of Shares sold pursuant to this Agreement
would exceed the lesser of (A) together with all sales of Shares under this
Agreement, the Maximum Amount, (B) the amount available for offer and sale under
the currently effective Registration Statement and (C) the amount authorized
from time to time to be issued and sold under this Agreement by the Company’s
board of directors, a duly authorized committee thereof or a duly authorized
executive committee, and notified to the Managers in writing. Under no
circumstances shall the Company cause or request the offer or sale of any Shares
pursuant to this Agreement at a price lower than the minimum price authorized
from time to time by the Company’s board of directors, a duly authorized
committee thereof or a duly authorized executive committee, and notified to the
Managers in writing. Further, under no circumstances shall the Company cause or
permit the aggregate offering amount of Shares sold pursuant to this Agreement
to exceed the Maximum Amount. 

 

(e)Regulation M Notice.  Unless the exceptive provisions set forth in
Rule 101(c)(1) of Regulation M under the Exchange Act are satisfied with respect
to the Shares, the Company shall give the Designated Manager at least one
Business  

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Day’s prior notice of its intent to sell any Shares in order to allow the
Designated Manager time to comply with Regulation M.

 

3.Representations and Warranties. The Company represents and warrants to, and
agrees with, each Manager at the Execution Time and on each such time the
following representations and warranties are repeated or deemed to be made
pursuant to this Agreement, as set forth below or in the Registration Statement,
the Prospectus or the Incorporated Documents. 

 

(a)Subsidiaries.  All of the direct and indirect subsidiaries (individually, a
“Subsidiary”) of the Company are set forth on Exhibit 21.1 to the Company’s most
recent Annual Report on Form 10-K filed with the Commission.  The Company owns,
directly or indirectly, all of the capital stock or other equity interests of
each Subsidiary free and clear of any “Liens” (which for purposes of this
Agreement shall mean a lien, charge, security interest, encumbrance, right of
first refusal, preemptive right or other restriction), and all the issued and
outstanding shares of capital stock of each Subsidiary are validly issued and
are fully paid, non-assessable and free of preemptive and similar rights to
subscribe for or purchase securities.   

 

(b)Organization and Qualification.  The Company and each of the Subsidiaries is
an entity duly incorporated or otherwise organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
(as applicable), with the requisite power and authority to own and use its
properties and assets and to carry on its business as currently conducted.
 Neither the Company nor any Subsidiary is in violation or default of any of the
provisions of its respective certificate or articles of incorporation, bylaws or
other organizational or charter documents.  Each of the Company and the
Subsidiaries is duly qualified to conduct business and is in good standing as a
foreign corporation or other entity in each jurisdiction in which the nature of
the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not reasonably be expected to result in (i) a material
adverse effect on the legality, validity or enforceability of this Agreement,
(ii) a material adverse change in the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, from that set forth in the Registration
Statement, the Base Prospectus, any Prospectus Supplement, the Prospectus or the
Incorporated Documents, or (iii) a material adverse effect on the Company’s
ability to perform in any material respect on a timely basis its obligations
under this Agreement (any of (i), (ii) or (iii), a “Material Adverse Effect”)
and no “Proceeding” (which for purposes of this Agreement shall mean any action,
claim, suit, investigation or proceeding (including, without limitation, an
investigation or partial proceeding, such as a deposition), whether commenced or
threatened) has been instituted in any such jurisdiction revoking, limiting or
curtailing or seeking to revoke, limit or curtail such power and authority or
qualification. 

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(c)Authorization and Enforcement.  The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by
this Agreement and otherwise to carry out its obligations hereunder.  The
execution and delivery of this Agreement by the Company and the consummation by
it of the transactions contemplated hereby have been duly authorized by all
necessary action on the part of the Company and no further action is required by
the Company, the Board or its stockholders in connection herewith other than in
connection with the Required Approvals.  This Agreement has been duly executed
and delivered by the Company and constitutes the valid and binding obligation of
the Company enforceable against the Company in accordance with its terms except
(i) as limited by general equitable principles and applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other
equitable remedies and (iii) insofar as indemnification and contribution
provisions may be limited by applicable law. 

 

(d)No Conflicts.  The execution, delivery and performance of this Agreement by
the Company, the issuance and sale of the Shares and the consummation by the
Company of the other transactions contemplated herein do not and will not (i)
conflict with or violate any provision of the Company’s or any Subsidiary’s
certificate or articles of incorporation, bylaws or other organizational or
charter documents, or (ii) conflict with, or constitute a default (or an event
that with notice or lapse of time or both would become a default) under, result
in the creation of any Lien upon any of the properties or assets of the Company
or any Subsidiary, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both) of,
any agreement, credit facility, debt or other instrument (evidencing a Company
or Subsidiary debt or otherwise) or other understanding to which the Company or
any Subsidiary is a party or by which any property or asset of the Company or
any Subsidiary is bound or affected, or (iii) subject to the Required Approvals,
conflict with or result in a violation of any law, rule, regulation, order,
judgment, injunction, decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and
state securities laws and regulations), or by which any property or asset of the
Company or a Subsidiary is bound or affected, except in the case of each of
clauses (ii) and (iii), such as could not reasonably be expected to result in a
Material Adverse Effect.  

 

(e)Filings, Consents and Approvals.  The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any
filing or registration with, any court or other federal, state, local or other
governmental authority or other “Person” (defined as an individual or
corporation, partnership, trust, incorporated or unincorporated association,
joint venture, limited liability company, joint stock company, government (or an
agency or subdivision thereof) or other entity of any kind, including the
Trading Market) in connection  

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with the execution, delivery and performance by the Company of this Agreement,
other than (i) the filings required by this Agreement, (ii) the filing with the
Commission of the Prospectus Supplement, (iii) the filing of application(s) to
and approval by the Trading Market for the listing of the Shares for trading
thereon in the time and manner required thereby, and (iv) such filings as are
required to be made under applicable state securities laws and the rules and
regulations of the Financial Industry Regulatory Authority, Inc. (“FINRA”)
(collectively, the “Required Approvals”).

 

(f)Issuance of Shares.  The Shares are duly authorized and, when issued and paid
for in accordance with this Agreement, will be duly and validly issued, fully
paid and nonassessable, free and clear of all Liens imposed by the Company.  The
Company has reserved from its duly authorized capital stock the maximum number
of shares of Common Stock issuable pursuant to this Agreement.  The issuance by
the Company of the Shares has been registered under the Act and all of the
Shares are freely transferable and tradable by the purchasers thereof without
restriction (other than any restrictions arising solely from an act or omission
of such a purchaser).  The Shares are being issued pursuant to the Registration
Statement and the issuance of the Shares has been registered by the Company
under the Act.  The “Plan of Distribution” section within the Registration
Statement permits the issuance and sale of the Shares as contemplated by this
Agreement.  Upon receipt of the Shares, the purchasers of such Shares will have
good and marketable title to such Shares and the Shares will be freely tradable
on the Trading Market.  

 

(g)Capitalization.  The capitalization of the Company is as set forth in the
Registration Statement, the Base Prospectus, the Prospectus Supplement and the
Prospectus.  The Company has not issued any capital stock since its most
recently filed periodic report under the Exchange Act, other than pursuant to
the exercise of employee stock options under the Company’s stock option plans,
the issuance of shares of Common Stock to employees pursuant to the Company’s
employee stock purchase plan and pursuant to the conversion or exercise of
securities exercisable, exchangeable or convertible into Common Stock (“Common
Stock Equivalents”).  No Person has any right of first refusal, preemptive
right, right of participation, or any similar right to participate in the
transactions contemplated by this Agreement.  Except (i) pursuant to the
Company’s stock option plans and (ii) pursuant to agreements or instruments
filed as exhibits to Incorporated Documents, there are no outstanding options,
warrants, script rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or
exercisable or exchangeable for, or giving any Person any right to subscribe for
or acquire, any shares of Common Stock, or contracts, commitments,
understandings or arrangements by which the Company or any Subsidiary is or may
become bound to issue additional shares of Common Stock or Common Stock
Equivalents.  The issuance and sale of the Shares will not obligate the Company
to issue shares of Common Stock or other securities to any Person and will not
result in a right of any holder of Company securities to  

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adjust the exercise, conversion, exchange or reset price under such securities.
All of the outstanding shares of capital stock of the Company are validly
issued, fully paid and nonassessable, have been issued in compliance with all
federal and state securities laws, and none of such outstanding shares was
issued in violation of any preemptive rights or similar rights to subscribe for
or purchase securities.  There are no stockholders agreements, voting agreements
or other similar agreements with respect to the Company’s capital stock to which
the Company is a party or, to the knowledge of the Company, between or among any
of the Company’s stockholders.

 

(h)Registration Statement.  The Company meets the requirements for use of
Form S-3 under the Act and has prepared and filed with the Commission the
Registration Statement, including a related Base Prospectus, for registration
under the Act of the offering and sale of the Shares. Such Registration
Statement is effective and available for the offer and sale of the Shares as of
the date hereof. As filed, the Base Prospectus contains all information required
by the Act and the rules thereunder, and, except to the extent the Lead Manager
shall agree in writing to a modification, shall be in all substantive respects
in the form furnished to the Lead Manager prior to the Execution Time or prior
to any such time this representation is repeated or deemed to be made. The
Registration Statement, at the Execution Time, each such time this
representation is repeated or deemed to be made, and at all times during which a
prospectus is required by the Act to be delivered (whether physically or through
compliance with Rule 172, 173 or any similar rule) in connection with any offer
or sale of the Shares, meets the requirements set forth in Rule 415(a)(1)(x).
The initial Effective Date of the Registration Statement was not earlier than
the date three years before the Execution Time.  

 

(i)Accuracy of Incorporated Documents.  The Incorporated Documents, when they
were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act and the rules thereunder, and none of the
Incorporated Documents, when they were filed with the Commission, contained any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made not misleading; and any further documents so filed and
incorporated by reference in the Registration Statement, the Base Prospectus,
the Prospectus Supplement or the Prospectus, when such documents are filed with
the Commission, will conform in all material respects to the requirements of the
Exchange Act and the rules thereunder, as applicable, and will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.  

 

(j)Ineligible Issuer.  (i) At the earliest time after the filing of the
Registration Statement that the Company or another offering participant made a
bona fide offer (within the meaning of Rule 164(h)(2)) of the Shares and (ii) as
of the Execution Time and on each such time this representation is repeated or
deemed  

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to be made (with such date being used as the determination date for purposes of
this clause (ii)), the Company was not and is not an Ineligible Issuer (as
defined in Rule 405), without taking account of any determination by the
Commission pursuant to Rule 405 that it is not necessary that the Company be
considered an Ineligible Issuer.

 

(k)Free Writing Prospectus.  The Company is eligible to use Issuer Free Writing
Prospectuses.  Each Issuer Free Writing Prospectus does not include any
information the substance of which conflicts with the information contained in
the Registration Statement, including any Incorporated Documents and any
prospectus supplement deemed to be a part thereof that has not been superseded
or modified; and each Issuer Free Writing Prospectus does not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The foregoing sentence does not apply to
statements in or omissions from any Issuer Free Writing Prospectus based upon
and in conformity with written information furnished to the Company by the
Managers specifically for use therein. Any Issuer Free Writing Prospectus that
the Company is required to file pursuant to Rule 433(d) has been, or will be,
filed with the Commission in accordance with the requirements of the Act and the
rules thereunder.  Each Issuer Free Writing Prospectus that the Company has
filed, or is required to file, pursuant to Rule 433(d) or that was prepared by
or behalf of or used by the Company complies or will comply in all material
respects with the requirements of the Act and the rules thereunder.  The Company
will not, without the prior consent of the Lead Manager, prepare, use or refer
to, any Issuer Free Writing Prospectuses. 

 

(l)Proceedings Related to Registration Statement.  The Registration Statement is
not the subject of a pending proceeding or examination under Section 8(d) or
8(e) of the Act, and the Company is not the subject of a pending proceeding
under Section 8A of the Act in connection with the offering of the Shares. The
Company has not received any notice that the Commission has issued or intends to
issue a stop-order with respect to the Registration Statement or that the
Commission otherwise has suspended or withdrawn the effectiveness of the
Registration Statement, either temporarily or permanently, or intends or has
threatened in writing to do so.   

 

(m)SEC Reports.  The Company has complied in all material respects with
requirements to file all reports, schedules, forms, statements and other
documents required to be filed by it under the Act and the Exchange Act,
including pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company was required by
law to file such material) (the foregoing materials, including the exhibits
thereto and documents incorporated by reference therein, being collectively
referred to herein as the “SEC Reports”) on a timely basis or has received a
valid extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension. 

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(n)Financial Statements.  The consolidated financial statements incorporated by
reference in the Registration Statement, the Prospectus or the Incorporated
Documents and any amendments thereof or supplements thereto comply in all
material respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the time of
filing or as amended or corrected in a subsequent filing.  Such financial
statements have been prepared in accordance with United States generally
accepted accounting principles applied on a consistent basis during the periods
involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all
material respects the financial position of the Company and its consolidated
subsidiaries as of and for the dates thereof and the results of operations and
cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments. 

 

(o) Accountants.  The Company’s accountants are Ernst & Young LLP.  To the
knowledge of the Company, such accountants, who the Company expects will express
their opinion with respect to the financial statements to be included in the
Company’s next Annual Report on Form 10-K, are a registered public accounting
firm as required by the Act.  

 

(p)Material Adverse Events.  Since the date of the latest audited financial
statements included within the SEC Reports, except as specifically disclosed in
a subsequent SEC Report filed prior to the date hereof, (i) there has been no
event, occurrence or development that has had or that could reasonably be
expected to result in a Material Adverse Effect, (ii) the Company has not
incurred any liabilities (contingent or otherwise) other than (A) trade payables
and accrued expenses incurred in the ordinary course of business consistent with
past practice and (B) liabilities not required to be reflected in the Company’s
financial statements pursuant to GAAP or required to be disclosed in filings
made with the Commission, (iii) the Company has not altered its method of
accounting, (iv) the Company has not declared or made any dividend or
distribution of cash or other property to its stockholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital
stock and (v) the Company has not issued any equity securities to any officer,
director or “Affiliate” (defined as any Person that, directly or indirectly
through one or more intermediaries, controls or is controlled by or is under
common control with a Person, as such terms are used in and construed under Rule
144 under the Act), except pursuant to existing Company stock option plans.  The
Company does not have pending before the Commission any request for confidential
treatment of information.  No event, liability or development has occurred or
exists with respect to the Company or its Subsidiaries or their respective
business, properties, operations or financial condition, that would be required
to be disclosed by the Company under applicable securities laws at the time this
representation is deemed made that has not been publicly disclosed at least 1
Trading Day prior to the date that this representation is deemed made.  

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(q)Litigation.  There is no action, suit, inquiry, notice of violation,
Proceeding or investigation pending or, to the knowledge of the Company,
threatened against or affecting the Company, any Subsidiary or any of their
respective properties before or by any court, arbitrator, governmental or
administrative agency or regulatory authority (federal, state, county, local or
foreign) (collectively, an “Action”) which (i) adversely affects or challenges
the legality, validity or enforceability of this Agreement or the Shares or (ii)
could, if there were an unfavorable decision, reasonably be expected to result
in a Material Adverse Effect.  Neither the Company nor any Subsidiary, nor, to
the knowledge of the Company, any director or officer thereof, is or has been
the subject of any Action involving a claim of violation of or liability under
federal or state securities laws or a claim of breach of fiduciary duty.  There
has not been, and to the knowledge of the Company, there is not pending or
contemplated, any investigation by the Commission involving the Company or any
current or former director or officer of the Company.  The Commission has not
issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company or any Subsidiary under the Exchange
Act or the Act.  

 

(r)Labor Relations.  No material labor dispute exists or, to the knowledge of
the Company, is imminent with respect to any of the employees of the Company
which could reasonably be expected to result in a Material Adverse Effect. None
of the Company’s or its Subsidiaries’ employees is a member of a union that
relates to such employee’s relationship with the Company, and neither the
Company nor any of its Subsidiaries is a party to a collective bargaining
agreement, and the Company and its Subsidiaries believe that their relationships
with their employees are good.  No executive officer, to the knowledge of the
Company, is, or is now expected to be, in violation of any material term of any
employment contract, confidentiality, disclosure or proprietary information
agreement or non-competition agreement, or any other contract or agreement or
any restrictive covenant, and the continued employment of each such executive
officer does not subject the Company or any of its Subsidiaries to any liability
with respect to any of the foregoing matters.  The Company and its Subsidiaries
are in compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms and
conditions of employment and wages and hours, except where the failure to be in
compliance could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. 

 

(s)No Existing Defaults.  Neither the Company nor any Subsidiary (i) is in
default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, would result in a default by
the Company or any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it is in
violation of, any indenture, loan or credit agreement or any other agreement or
instrument to which it is a party or by which it or any of its properties is
bound (whether or not such  

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default or violation has been waived), (ii) is in violation of any order of any
court, arbitrator or governmental body, or (iii) is or has been in violation of
any statute, rule or regulation of any governmental authority, including without
limitation all foreign, federal, state and local laws relating to taxes,
environmental protection, occupational health and safety, product quality and
safety and employment and labor matters, except in each case as could not
reasonably be expected to result in a Material Adverse Effect.

 

(t)Regulatory Permits.  The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their
respective businesses as described in the Registration Statement, the Base
Prospectus, any Prospectus Supplement or the Prospectus, except where the
failure to possess such permits could not reasonably be expected to result in a
Material Adverse Effect (“Material Permits”), and neither the Company nor any
Subsidiary has received any notice of proceedings relating to the revocation or
modification of any Material Permit.  For clarity, the Company has not received
the approval of any regulatory agency to market any of its product candidates. 

 

(u)Title to Assets.  The Company and the Subsidiaries have good and marketable
title to all real property owned by them that is material to the business of the
Company and the Subsidiaries and good and marketable title in all personal
property owned by them that is material to the business of the Company and the
Subsidiaries, in each case free and clear of all Liens, except for Liens as do
not materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company and
the Subsidiaries and Liens for the payment of federal, state or other taxes, the
payment of which is neither delinquent nor subject to penalties. The Palangana
Mine, the Hobson Processing Facility, the Burke Hollow Project, the Alto Parana
Titanium Project and the Reno Creek Project, each as described or included or
incorporated by reference in the Prospectus (collectively, the “Material
Properties”) are the only resource properties currently material to the Company
in which the Company or the Subsidiaries have an interest; the Company or
through the Subsidiaries, hold either freehold title, mining leases, mining
concessions, mining claims, exploration permits, prospecting permits or
participant interests or other conventional property or proprietary interests or
rights, recognized in the jurisdiction in which the Material Properties are
located, in respect of the ore bodies and minerals located on the Material
Properties in which the Company (through the applicable Subsidiary) has an
interest under valid, subsisting and enforceable title documents or other
recognized and enforceable agreements, contracts, arrangements or
understandings, sufficient to permit the Company (through the applicable
Subsidiary) to explore for and exploit the minerals relating thereto; all leases
or claims and permits relating to the Material Properties in which the Company
(through the applicable Subsidiary) has an interest or right have been validly
located and recorded in accordance with all applicable laws and are valid and
subsisting; except as disclosed in the Prospectus, the Company (through the
applicable Subsidiary) has all necessary  

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surface rights, access rights and other necessary rights and interests relating
to the Material Property in which the Company (through the applicable
Subsidiary) has an interest granting the Company (through the applicable
Subsidiary) the right and ability to explore for and exploit minerals, ore and
metals for development and production purposes as are appropriate in view of the
rights and interest therein of the Company or the applicable Subsidiary, with
only such exceptions as do not materially interfere with the current use made by
the Company or the applicable Subsidiary of the rights or interest so held, and
each of the proprietary interests or rights and each of the agreements,
contracts, arrangements or understandings and obligations relating thereto
referred to above is currently in good standing in all respects in the name of
the Company or the applicable Subsidiary; except as disclosed in the Prospectus,
the Company and the Subsidiaries do not have any responsibility or obligation to
pay any commission, royalty, license, fee or similar payment to any person with
respect to the property rights thereof, except where such fee or payment would
not have a Material Adverse Effect, either individually or in the aggregate;

(i)the Company or the applicable Subsidiary holds direct interests in the
Material Properties, as described in the Prospectus (the “Project Rights”),
under valid, subsisting and enforceable agreements or instruments, and all such
agreements and instruments in connection with the Project Rights are valid and
subsisting and enforceable in accordance with their terms, except (A) as limited
by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (B) as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies, and (C) insofar as indemnification and contribution provisions may be
limited by applicable law; 

(ii)the Company and the Subsidiaries have identified all the material permits,
certificates, and approvals (collectively, the “Permits”) which are or will be
required for the exploration, development and eventual or actual operation of
the Material Properties, which Permits include but are not limited to
environmental assessment certificates, water licenses, land tenures, rezoning or
zoning variances and other necessary local, state and federal approvals; and,
except as disclosed in the Prospectus, the appropriate Permits have either been
received, applied for, or the processes to obtain such Permits have been or will
in due course be initiated by the Company or the applicable Subsidiaries; and,
except as disclosed in the Prospectus, neither the Company nor the applicable
Subsidiaries know of any issue or reason why the Permits should not be approved
and obtained in the ordinary course; 

(iii)all assessments or other work required to be performed in relation to  

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the material mining claims and the mining rights of the Company and the
applicable Subsidiary in order to maintain their respective interests therein,
if any, have been performed to date and, except as disclosed in the Prospectus,
the Company and the applicable Subsidiary have complied in all material respects
with all applicable laws in this regard as well as with regard to legal and
contractual obligations to third parties in this regard except in respect of
mining claims and mining rights that the Company and the applicable Subsidiary
intend to abandon or relinquish and except for any non-compliance which would
not either individually or in the aggregate have a Material Adverse Effect; all
such mining claims and mining rights are in good standing in all respects as of
the date of this Agreement;

(iv)except as disclosed or included or incorporated by reference in the
Prospectus, all mining operations on the properties of the Company and the
Subsidiaries (including, without limitation, the Material Properties) have been
conducted in all respects in accordance with good mining and engineering
practices and all applicable workers’ compensation and health and safety and
workplace laws, regulations and policies have been duly complied with; and 

(v)except as disclosed or included or incorporated by reference in the
Prospectus, there are no environmental audits, evaluations, assessments, studies
or tests relating to the Company or the Subsidiaries except for ongoing
assessments conducted by or on behalf of the Company and the Subsidiaries in the
ordinary course. 

 

(v)Intellectual Property.  The Company and the Subsidiaries have, or have rights
to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and
other similar intellectual property rights necessary or material for use in
connection with their respective businesses as described in the Registration
Statement, the Base Prospectus, any Prospectus Supplement or the Prospectus and
which the failure to so have could reasonably be expected to have a Material
Adverse Effect (collectively, the “Intellectual Property Rights”).  Neither the
Company nor any Subsidiary has received, since the date of the latest audited
financial statements included within the SEC Reports, a notice (written or
otherwise) that the Intellectual Property Rights violate or infringe upon the
rights of any Person, except as would not have a Material Adverse Effect.  To
the knowledge of the Company, all such Intellectual Property Rights are
enforceable (other than patent and trademark applications) and there is no
existing infringement by another Person of any of the Intellectual Property
Rights.  The Company and its Subsidiaries have taken reasonable security
measures to protect the secrecy, confidentiality and value of all of their
Intellectual Property Rights, except where  

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failure to do so could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

 

(w)Insurance.  The Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary for companies of similar size as the
Company in the businesses in which the Company and the Subsidiaries are engaged,
including, but not limited to, directors and officers insurance coverage.  To
the knowledge of the Company, such insurance contracts and policies are accurate
and complete.  Neither the Company nor any Subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant increase in cost.  

 

(x)Affiliate Transactions.  Except as set forth in the Registration Statement,
the Base Prospectus, any Prospectus Supplement or the Prospectus, none of the
officers or directors of the Company and, to the knowledge of the Company, none
of the employees of the Company is presently a party to any transaction with the
Company or any Subsidiary (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for
the furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of the Company, any entity in
which any officer, director, or any such employee has a substantial interest or
is an officer, director, trustee or partner, in each case in excess of $120,000,
other than (i) for payment of salary or consulting fees for services rendered,
(ii) reimbursement for expenses incurred on behalf of the Company and (iii) for
other employee benefits, including stock option agreements under any stock
option plan of the Company.  

 

(y)Sarbanes Oxley Compliance.  Except as disclosed in the Registration
Statement, the Base Prospectus, any Prospectus Supplement or the Prospectus, the
Company is in material compliance with all provisions of the Sarbanes-Oxley Act
of 2002 which are applicable to it as of the Effective Date. The Company and the
Subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that: (i) transactions are executed in accordance
with management’s general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management’s general or specific
authorization, and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences. The Company has established disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
Company and designed such disclosure controls and procedures to ensure that
information required to be disclosed by the Company in the reports it files or  

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submits under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Commission’s rules and forms.  The
Company’s certifying officers have evaluated the effectiveness of the Company’s
disclosure controls and procedures as of the end of the period covered by the
Company’s most recently filed periodic report under the Exchange Act (such date,
the “Evaluation Date”).  The Company presented in its most recently filed
periodic report under the Exchange Act the conclusions of the certifying
officers about the effectiveness of the disclosure controls and procedures based
on their evaluations as of the Evaluation Date.  Since the Evaluation Date,
there have been no changes in the Company’s internal control over financial
reporting (as such term is defined in the Exchange Act) that has materially
affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting.

 

(z)Finder’s Fees.  Other than payments to be made to the Managers, no brokerage
or finder’s fees or commissions are or will be payable by the Company to any
broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by
this Agreement.  The Managers shall have no obligation with respect to any fees
or with respect to any claims made by or on behalf of other Persons for fees of
a type contemplated in this Section that may be due in connection with the
transactions contemplated by this Agreement.  

 

(aa)No Other Sales Agency Agreement.  The Company has not entered into any other
sales agency agreements or other similar arrangements with any agent or any
other representative in respect of at the market offerings of the Shares.  

 

(bb)Regulation M Compliance.  The Company has not, and to its knowledge no one
acting on its behalf has, (i) taken, directly or indirectly, any action designed
to cause or to result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of any of the Shares,
(ii) sold, bid for, purchased, or paid any compensation for soliciting purchases
of, any of the Shares or (iii) paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company, other than, in the case of clauses (ii) and (iii), compensation paid to
the Designated Manager in connection with the placement of the Shares. 

 

(cc)Listing and Maintenance Requirements.  The issuance and sale of the Shares
as contemplated in this Agreement does not contravene the rules and regulations
of the Trading Market. The Common Stock is registered pursuant to Section 12(b)
or 12(g) of the Exchange Act, and the Company has taken no action designed to,
or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act nor has the Company
received any notification that the Commission is contemplating terminating such
registration.  Except as disclosed in the Registration Statement, the Base
Prospectus, any Prospectus Supplement or the Prospectus, the Company has not, in
the 12 months preceding the date hereof, received notice from any Trading Market
 

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on which the Common Stock is or has been listed or quoted to the effect that the
Company is not in compliance with the listing or maintenance requirements of
such Trading Market.

 

(dd)Application of Takeover Protections.  Except as set forth in the
Registration Statement, the Base Prospectus, any Prospectus Supplement or the
Prospectus, the Company and its Board have taken all necessary action, if any,
in order to render inapplicable any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement)
or other similar antitakeover provision under the Company’s Certificate of
Incorporation (or similar charter documents) or the laws of its state of
incorporation that is or could become applicable to the purchasers of the
Shares. 

 

(ee)Investment Company.  The Company is not, and is not an Affiliate of, and
immediately after receipt of payment for the Shares, will not be or be an
Affiliate of, an “investment company” within the meaning of the Investment
Company Act of 1940, as amended.  The Company 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. 

 

(ff)Solvency.  Based on the financial condition of the Company as of the
Effective Date, (i) the Company’s fair saleable value of its assets exceeds the
amount that will be required to be paid on or in respect of the Company’s
existing debts and other liabilities (including known contingent liabilities) as
they mature, (ii) the Company’s assets do not constitute unreasonably small
capital to carry on its business as now conducted and as proposed to be
conducted including its capital needs taking into account the particular capital
requirements of the business conducted by the Company, and projected capital
requirements and capital availability thereof, and (iii) the current cash flow
of the Company, together with the proceeds the Company would receive, were it to
liquidate all of its assets, after taking into account all anticipated uses of
the cash, would be sufficient to pay all amounts on or in respect of its debt
when such amounts are required to be paid.  Within one year of the Effective
Date, the Company does not intend to incur debts beyond its ability to pay such
debts as they mature (taking into account the timing and amounts of cash to be
payable on or in respect of its debt).    The SEC Reports set forth as of the
dates thereof all outstanding secured and unsecured Indebtedness of the Company
or any Subsidiary, or for which the Company or any Subsidiary has commitments.
 For the purposes of this Agreement, “Indebtedness” shall mean (a) any
liabilities for borrowed money or amounts owed in excess of $250,000 (other than
accrued liabilities and trade accounts payable incurred in the ordinary course
of business), (b) all guaranties, endorsements and other contingent obligations
in respect of indebtedness of others, whether or not the same are or should be
reflected in the Company’s balance sheet (or the notes thereto), except
guaranties by endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business; and (c) the present
value of any lease payments in excess of $250,000 due under leases required to
be  

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capitalized in accordance with GAAP.  Neither the Company nor any Subsidiary is
in default with respect to any Indebtedness.

 

(gg)Tax Status. Except for matters that would not, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect, the Company and each Subsidiary (i) has made or filed all necessary
United States federal, and state income and all foreign income and franchise tax
returns and have paid or accrued all taxes shown as due thereon, and the Company
has no knowledge of a tax deficiency which has been asserted or threatened
against the Company or reports and declarations required by any jurisdiction to
which it is subject, (ii) has paid all taxes and other governmental assessments
and charges that are material in amount, shown or determined to be due on such
returns, reports and declarations and (iii) has set aside on its books provision
reasonably adequate for the payment of all material taxes for periods subsequent
to the periods to which such returns, reports or declarations apply.  There are
no unpaid taxes in any material amount claimed to be due by the taxing authority
of any jurisdiction, and the officers of the Company or of any Subsidiary know
of no basis for any such claim. 

 

(hh)Foreign Corrupt Practices.  Neither the Company, nor to the knowledge of the
Company, any agent or other person acting on behalf of the Company, has (i)
directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic
political activity, (ii) made any unlawful payment to foreign or domestic
government officials or employees or to any foreign or domestic political
parties or campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by the Company (or made by any person acting on its behalf of
which the Company is aware) which is  in violation of law, or (iv) violated in
any material respect any provision of the Foreign Corrupt Practices Act of 1977,
as amended. 

 

(ii)FINRA Member Shareholders.  There are no affiliations with any FINRA member
firm among the Company’s officers, directors or, to the knowledge of the
Company, any five percent (5%) or greater stockholder of the Company, except as
set forth in the Registration Statement, the Base Prospectus, any Prospectus
Supplement or the Prospectus. 

 

4.Agreements. The Company agrees with each Manager that:  

 

(a)Right to Review Amendments and Supplements to Registration Statement and
Prospectus.  During any period when the delivery of a prospectus relating to the
Shares is required (including in circumstances where such requirement may be
satisfied pursuant to Rule 172, 173 or any similar rule) to be delivered under
the Act in connection with the offering or the sale of Shares, the Company will
not file any amendment to the Registration Statement or supplement (including
any Prospectus Supplement) to the Base Prospectus unless the Company has
furnished to the Lead Manager a copy for its review prior to filing and will not
file any such proposed amendment or supplement to which the Lead Manager  

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reasonably objects. The Company has properly completed the Prospectus, in a form
approved by the Lead Manager, and filed such Prospectus, as amended at the
Execution Time, with the Commission pursuant to the applicable paragraph of
Rule 424(b) by the Execution Time and will cause any supplement to the
Prospectus to be properly completed, in a form approved by the Lead Manager, and
will file such supplement with the Commission pursuant to the applicable
paragraph of Rule 424(b) within the time period prescribed thereby and will
provide evidence reasonably satisfactory to the Lead Manager of such timely
filing. The Company will promptly advise the Managers (i) when the Prospectus,
and any supplement thereto, shall have been filed (if required) with the
Commission pursuant to Rule 424(b), (ii) when, during any period when the
delivery of a prospectus (whether physically or through compliance with
Rule 172, 173 or any similar rule) is required under the Act in connection with
the offering or sale of the Shares, any amendment to the Registration Statement
shall have been filed or become effective (other than any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act), (iii) of
any request by the Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any supplement to
the Prospectus or for any additional information, (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any notice objecting to its use or the institution or
threatening of any proceeding for that purpose and (v) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Shares for sale in any jurisdiction or the institution or threatening of
any proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or the occurrence of any such
suspension or objection to the use of the Registration Statement and, upon such
issuance, occurrence or notice of objection, to obtain as soon as possible the
withdrawal of such stop order or relief from such occurrence or objection,
including, if necessary, by filing an amendment to the Registration Statement or
a new registration statement and using its best efforts to have such amendment
or new registration statement declared effective as soon as practicable.

 

(b)Subsequent Events.  If, at any time on or after an Applicable Time but prior
to the related Settlement Date, any event occurs as a result of which the
Registration Statement or Prospectus would include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein in the light of the circumstances under which they were made
or the circumstances then prevailing not misleading, the Company will (i) notify
promptly the Managers so that any use of the Registration Statement or
Prospectus may cease until such are amended or supplemented; (ii) amend or
supplement the Registration Statement or Prospectus to correct such statement or
omission; and (iii) supply any amendment or supplement to the Managers in such
quantities as the Managers may reasonably request.  

 

(c)Notification of Subsequent Filings.  During any period when the delivery of a
prospectus relating to the Shares is required (including in  

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circumstances where such requirement may be satisfied pursuant to Rule 172, 173
or any similar rule) to be delivered under the Act, any event occurs as a result
of which the Prospectus as then supplemented would include any untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein in the light of the circumstances under which they were made
not misleading, or if it shall be necessary to amend the Registration Statement,
file a new registration statement or supplement the Prospectus to comply with
the Act or the Exchange Act or the respective rules thereunder, including in
connection with use or delivery of the Prospectus, the Company promptly will
(i) notify the Managers of any such event, (ii) subject to Section 4(a), prepare
and file with the Commission an amendment or supplement or new registration
statement which will correct such statement or omission or effect such
compliance, (iii) use its best efforts to have any amendment to the Registration
Statement or new registration statement declared effective as soon as
practicable in order to avoid any disruption in use of the Prospectus and
(iv) supply any supplemented Prospectus to the Managers in such quantities as
the Managers may reasonably request.

 

(d)Earnings Statements.  As soon as practicable, the Company will make generally
available to its security holders and to the Managers an earnings statement or
statements of the Company and its Subsidiaries which will satisfy the provisions
of Section 11(a) of the Act and Rule 158. 

 

(e)Delivery of Registration Statement.  Upon the request of a Manager, the
Company will furnish to such Manager and counsel for such Manager, without
charge, signed copies of the Registration Statement (including exhibits thereto)
and, so long as delivery of a prospectus by such Manager or dealer may be
required by the Act (including in circumstances where such requirement may be
satisfied pursuant to Rule 172, 173 or any similar rule), as many copies of the
Prospectus and each Issuer Free Writing Prospectus and any supplement thereto as
such Manager may reasonably request. The Company will pay the expenses of
printing or other production of all documents relating to the offering.  

 

(f)Qualification of Shares.  The Company will arrange, if necessary, for the
qualification of the Shares for sale under the laws of such jurisdictions as the
Lead Manager may designate and will maintain such qualifications in effect so
long as required for the distribution of the Shares; provided that in no event
shall the Company be obligated to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action that would subject it to
service of process in suits, other than those arising out of the offering or
sale of the Shares, in any jurisdiction where it is not now so subject.  

 

(g)Free Writing Prospectus.  The Company agrees that, unless it has or shall
have obtained the prior written consent of the Lead Manager, and the Lead
Manager agrees with the Company that, unless it has or shall have obtained, as
the case may be, the prior written consent of the Company, it has not made and
will not make any offer relating to the Shares that would constitute an Issuer
Free Writing  

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Prospectus or that would otherwise constitute a “free writing prospectus” (as
defined in Rule 405) required to be filed by the Company with the Commission or
retained by the Company under Rule 433. Any such free writing prospectus
consented to by the Lead Manager or the Company is hereinafter referred to as a
“Permitted Free Writing Prospectus.” The Company agrees that (i) it has treated
and will treat, as the case may be, each Permitted Free Writing Prospectus as an
Issuer Free Writing Prospectus and (ii) it has complied and will comply, as the
case may be, with the requirements of Rules 164 and 433 applicable to any
Permitted Free Writing Prospectus, including in respect of timely filing with
the Commission, legending and record keeping.

 

(h)Subsequent Equity Issuances.  Neither the Company nor any Subsidiary will
offer, sell, issue, contract to sell, contract to issue or otherwise dispose of,
directly or indirectly, any other shares of Common Stock or any Common Stock
Equivalents (other than the Shares) during the term of this Agreement
(i) without giving the Managers at least three Business Days’ prior written
notice specifying the nature of the proposed transaction and the date of such
proposed transaction and (ii) unless Lead Manager suspends acting under this
Agreement for such period of time requested by the Company or as deemed
appropriate by the Lead Manager in light of the proposed transaction; provided,
however, that the Company may issue and sell Common Stock pursuant to any
employee stock option plan, stock ownership plan or dividend reinvestment plan
of the Company in effect at the Execution Time and issuances of restricted
Common Stock to consultants with past practice and, with as much notice as
reasonably practicable, the Company may issue Common Stock issuable upon the
conversion or exercise of Common Stock Equivalents outstanding at the Execution
Time. 

 

(i)Market Manipulation.  Until the termination of this Agreement, the Company
will not take, directly or indirectly, any action designed to or that would
constitute or that might reasonably be expected to cause or result in, under the
Exchange Act or otherwise, stabilization or manipulation in violation of the
Act, Exchange Act or the rules and regulations thereunder of the price of any
security of the Company to facilitate the sale or resale of the Shares or
otherwise violate any provision of Regulation M under the Exchange Act. 

 

(j)Notification of Incorrect Certificate.  The Company will, at any time during
the term of this Agreement, as supplemented from time to time, advise the
Managers immediately after it shall have received notice or obtained knowledge
thereof, of any information or fact that would alter or affect any opinion,
certificate, letter and other document provided to the Managers pursuant to
Section 6 herein.  

 

(k)Certification of Accuracy of Disclosure.  Upon commencement of the offering
of the Shares under this Agreement (and upon the recommencement of the offering
of the Shares under this Agreement following the termination of a suspension of
sales hereunder lasting more than 30 Trading Days), and each time that (i) the
Registration Statement or Prospectus shall be amended or supplemented,  

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other than by means of Incorporated Documents, (ii) the Company files its Annual
Report on Form 10-K under the Exchange Act, (iii) the Company files its
quarterly reports on Form 10-Q under the Exchange Act, (iv) the Company files a
Current Report on Form 8-K containing amended financial information (other than
information that is furnished and not filed), if the Lead Manager reasonably
determines that the information in such Form 8-K is material, or (v) the Shares
are delivered to the Lead Manager as principal at the Time of Delivery pursuant
to a Terms Agreement (such commencement or recommencement date and each such
date referred to in (i), (ii), (iii), (iv) and (v) above, a “Representation
Date”), unless waived by the Lead Manager, the Company shall furnish or cause to
be furnished to the Lead Manager forthwith a certificate dated and delivered on
the Representation Date, in form reasonably satisfactory to the Lead Manager to
the effect that the statements contained in the certificate referred to in
Section 6 of this Agreement which were last furnished to the Lead Manager are
true and correct at the Representation Date, as though made at and as of such
date (except that such statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to such date) or, in
lieu of such certificate, a certificate of the same tenor as the certificate
referred to in said Section 6, modified as necessary to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
date of delivery of such certificate.

 

(l)Bring Down Opinions; Negative Assurance.  At each Representation Date, unless
waived by the Lead Manager, the Company shall furnish or cause to be furnished
forthwith to the Lead Manager and to counsel to the Lead Manager a written
opinion of counsel to the Company (“Company Counsel”) addressed to the Lead
Manager and dated and delivered on such Representation Date, in form and
substance reasonably satisfactory to the Lead Manager, including a negative
assurance representation. 

 

(m)Auditor Bring Down “Comfort” Letter.  At each Representation Date, unless
waived by the Lead Manager, the Company shall cause (1) the Company’s auditors
(the “Accountants”), or other independent accountants satisfactory to the Lead
Manager forthwith to furnish the Lead Manager a letter, and (2) the Chief
Financial Officer of the Company forthwith to furnish the Lead Manager a
certificate, in each case dated on such Representation Date, in form
satisfactory to the Lead Manager, of the same tenor as the letters and
certificate referred to in Section 6 of this Agreement but modified to relate to
the Registration Statement and the Prospectus, as amended and supplemented to
the date of such letters and certificate; provided, however, that the Company
will not be required to cause the Accountants to furnish such letters to the
Lead Manager in connection with the filing of a Current Report on Form 8-K
unless (i) such Current Report on Form 8-K is filed at any time during which a
prospectus relating to the Shares is required to be delivered under the Act and
(ii) the Lead Manager has requested such letter based upon the event or events
reported in such Current Report on Form 8-K. 

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(n)Due Diligence Session.  Upon commencement of the offering of the Shares under
this Agreement (and upon the recommencement of the offering of the Shares under
this Agreement following the termination of a suspension of sales hereunder
lasting more than 30 Trading Days), and at each Representation Date, the Company
will conduct a due diligence session, in form and substance, reasonably
satisfactory to the Lead Manager, which shall include representatives of
management and Accountants. The Company shall cooperate timely with any
reasonable due diligence request from or review conducted by the Lead Manager or
its agents from time to time in connection with the transactions contemplated by
this Agreement, including, without limitation, providing information and
available documents and access to appropriate corporate officers and the
Company’s agents during regular business hours and at the Company’s principal
offices, and timely furnishing or causing to be furnished such certificates,
letters and opinions from the Company, its officers and its agents, as the Lead
Manager may reasonably request. The Company shall reimburse the Lead Manager for
Lead Manager’s counsel’s time in each such due diligence update session, up to a
maximum of $5,000 per update, plus any incidental expense incurred by the Lead
Manager in connection therewith. 

 

(o)Acknowledgment of Trading.  The Company consents to each Manager trading in
the Common Stock for such Manager’s own account and for the account of its
clients at the same time as sales of the Shares occur pursuant to this Agreement
or pursuant to a Terms Agreement.  

 

(p)Disclosure of Shares Sold.  The Company will disclose in its Annual Reports
on Form 10-K and Quarterly Reports on Form 10-Q, as applicable, the number of
Shares sold through the Managers under this Agreement, the Net Proceeds to the
Company and the compensation paid by the Company with respect to sales of Shares
pursuant to this Agreement during the relevant quarter; and, if required by any
subsequent change in Commission policy or request, more frequently by means of a
Current Report on Form 8-K or a further Prospectus Supplement.  

 

(q)Rescission Right.  If to the knowledge of the Company, the conditions set
forth in Section 6 shall not have been satisfied as of the applicable Settlement
Date, the Company will offer to any person who has agreed to purchase Shares
from the Company as the result of an offer to purchase solicited by Designated
Manager the right to refuse to purchase and pay for such Shares.  

 

(r)Bring Down of Representations and Warranties.  Each acceptance by the Company
of an offer to purchase the Shares hereunder, and each execution and delivery by
the Company of a Terms Agreement, shall be deemed to be an affirmation to
Designated Manager 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 or of such Terms Agreement as though made at and as of
such date, and an undertaking that such representations and warranties will be  

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true and correct as of the Settlement Date for the Shares relating to such
acceptance or as of the Time of Delivery relating to such sale, as the case may
be, as though made at and as of such date (except that such representations and
warranties shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented relating to such Shares).

 

(s)Reservation of Shares.  The Company shall ensure that there are at all times
sufficient shares of Common Stock to provide for the issuance, free of any
preemptive rights, out of its authorized but unissued shares of Common Stock or
shares of Common Stock held in treasury, of the maximum aggregate number of
Shares authorized for issuance by the Board pursuant to the terms of this
Agreement. The Company will use its commercially reasonable efforts to cause the
Shares to be listed for trading on the Trading Market and to maintain such
listing.  

 

(t)Obligation Under Exchange Act.  During any period when the delivery of a
prospectus relating to the Shares is required (including in circumstances where
such requirement may be satisfied pursuant to Rule 172, 173 or any similar rule)
to be delivered under the Act, the Company will file all documents required to
be filed with the Commission pursuant to the Exchange Act within the time
periods required by the Exchange Act and the regulations thereunder.  

 

(u)DTC Facility.  The Company shall cooperate with Managers and use its
commercially reasonable best efforts to permit the Shares to be eligible for
clearance and settlement through the facilities of DTC.  

 

(v)Use of Proceeds.  The Company will apply the Net Proceeds from the sale of
the Shares in the manner set forth in the Prospectus.  

 

(w)Filing of Prospectus Supplement.  On or prior to the earlier of (i) the date
on which the Company shall file a Quarterly Report on Form 10-Q or an Annual
Report on Form 10-K in respect of any fiscal quarter in which sales of Shares
were made by a Designated Manager pursuant to Section 2(b) of this Agreement and
(ii) the date on which the Company shall be obligated to file such document
referred to in clause (i) in respect of such quarter (each such date, and any
date on which an amendment to any such document is filed, a “Filing Date”), the
Company will file a prospectus supplement with the Commission under the
applicable paragraph of Rule 424(b), which prospectus supplement will set forth,
with regard to such quarter, the aggregate number of the Shares sold through the
Managers as agent pursuant to Section 2(b) of this Agreement, the Net Proceeds
to the Company and the compensation paid by the Company with respect to such
sales of the Shares pursuant to Section 2(b) of this Agreement and deliver such
number of copies of each such prospectus supplement to the Trading Market as are
required by such exchange. In the event any sales are made pursuant to this
Agreement which are NOT made in “at the market” offerings as defined in Rule
415, including, without limitation, any Placement pursuant to a Terms Agreement,
the Company  

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shall file a Prospectus Supplement describing the terms of such transaction, the
amount of Shares sold, the price thereof, the Managers’ compensation, and such
other information as may be required pursuant to Rule 424 and Rule 430B, as
applicable, within the time required by Rule 424.

 

(x)Additional Registration Statement.  To the extent that the Registration
Statement is not available for the sales of the Shares as contemplated by this
Agreement, the Company shall file a new registration statement with respect to
any additional shares of Common Stock necessary to complete such sales of the
Shares and shall cause such registration statement to become effective as
promptly as practicable. After the effectiveness of any such registration
statement, all references to “Registration Statement” included in this Agreement
shall be deemed to include such new registration statement, including all
documents incorporated by reference therein pursuant to Item 12 of Form S-3, and
all references to “Base Prospectus” included in this Agreement shall be deemed
to include the final form of prospectus, including all documents incorporated
therein by reference, included in any such registration statement at the time
such registration statement became effective. 

 

5.Payment of Expenses. The Company agrees to pay the costs and expenses incident
to the performance of its obligations under this Agreement, whether or not the
transactions contemplated hereby are consummated, including without limitation:
(i) the preparation, printing or reproduction and filing with the Commission of
the Registration Statement (including financial statements and exhibits
thereto), the Prospectus and each Issuer Free Writing Prospectus, and each
amendment or supplement to any of them; (ii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of the Registration Statement, the Prospectus, and
each Issuer Free Writing Prospectus, and all amendments or supplements to any of
them, as may, in each case, be reasonably requested for use in connection with
the offering and sale of the Shares; (iii) the preparation, printing,
authentication, issuance and delivery of certificates for the Shares, including
any stamp or transfer taxes in connection with the original issuance and sale of
the Shares; (iv) the printing (or reproduction) and delivery of this Agreement,
any blue sky memorandum and all other agreements or documents printed (or
reproduced) and delivered in connection with the offering of the Shares; (v) the
registration of the Shares under the Exchange Act, if applicable, and the
listing of the Shares on the Trading Market; (vi) any registration or
qualification of the Shares for offer and sale under the securities or blue sky
laws of the several states (including filing fees and the reasonable fees and
expenses of counsel for the Lead Manager relating to such registration and
qualification); (vii) the transportation and other expenses incurred by or on
behalf of Company representatives in connection with presentations to
prospective purchasers of the Shares; (viii) the fees and expenses of the
Company’s accountants and the fees and expenses of counsel (including local and
special counsel) for the Company; (ix) the filing fee under FINRA Rule 5110; (x)
the reasonable fees and expenses of the Lead Manager’s counsel, not to exceed
$50,000.00 (excluding any periodic due diligence fees provided for under Section
4(n)), which shall be paid upon the Execution Time; and  

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(xi) all other costs and expenses incident to the performance by the Company of
its obligations hereunder.

 

6.Conditions to the Obligations of the Managers. The obligations of the Managers
under this Agreement and any Terms Agreement shall be subject to (i) the
accuracy of the representations and warranties on the part of the Company
contained herein as of the Execution Time, each Representation Date, and as of
each Applicable Time, Settlement Date and Time of Delivery, (ii) the performance
by the Company of its obligations hereunder and (iii) the following additional
conditions: 

 

(a)Filing of Prospectus Supplement.  The Prospectus, and any supplement thereto,
required by Rule 424 to be filed with the Commission have been filed in the
manner and within the time period required by Rule 424(b) with respect to any
sale of Shares; each Prospectus Supplement shall have been filed in the manner
required by Rule 424(b) within the time period required hereunder and under the
Act; any other material required to be filed by the Company pursuant to
Rule 433(d) under the Act, shall have been filed with the Commission within the
applicable time periods prescribed for such filings by Rule 433; and no stop
order suspending the effectiveness of the Registration Statement or any notice
objecting to its use shall have been issued and no proceedings for that purpose
shall have been instituted or threatened.  

 

(b)Delivery of Opinion.  The Company shall have caused the Company Counsel to
furnish to the Lead Manager, requested by the Lead Manager and upon reasonable
advance notice in connection with any offering of the Shares, its opinion and
negative assurance statement, dated as of such date and addressed to the Lead
Manager in form and substance acceptable to the Lead Manager. 

 

(c)Delivery of Officer’s Certificate.  The Company shall have furnished or
caused to be furnished to the Lead Manager, to the extent requested by the Lead
Manager and upon reasonable advance notice in connection with any offering of
the Shares, a certificate of the Company signed by the Chief Executive Officer
or the President and the principal financial or accounting officer of the
Company, dated as of such date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the Prospectus,
any Prospectus Supplement and any documents incorporated by reference therein
and any supplements or amendments thereto and this Agreement and that:  

 

(i)the representations and warranties of the Company in this Agreement are true
and correct on and as of such date with the same effect as if made on such date
and the Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to such date;  

 

(ii)no stop order suspending the effectiveness of the Registration Statement or
any notice objecting to its use has been issued and  

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no proceedings for that purpose have been instituted or, to the Company’s
knowledge, threatened; and

 

(iii)since the date of the most recent financial statements included in the
Registration Statement, the Prospectus and the Incorporated Documents, there has
been no Material Adverse Effect on the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Registration Statement
and the Prospectus.  

 

(d)Delivery of Accountants’ “Comfort” Letter.  The Company shall have requested
and caused the Accountants to have furnished to the Lead Manager, to the extent
requested by the Lead Manager and upon reasonable advance notice in connection
with any offering of the Shares, letters (which may refer to letters previously
delivered to the Lead Manager), dated as of such date, in form and substance
satisfactory to the Lead Manager, confirming that they are independent
accountants within the meaning of the Act and the Exchange Act and the
respective applicable rules and regulations adopted by the Commission thereunder
and that they have performed a review of any unaudited interim financial
information of the Company included or incorporated by reference in the
Registration Statement and the Prospectus and provide customary “comfort” as to
such review in form and substance satisfactory to the Lead Manager. 

 

(e)No Material Adverse Event.  Since the respective dates as of which
information is disclosed in the Registration Statement, the Prospectus and the
Incorporated Documents, except as otherwise stated therein, there shall not have
been (i) any change or decrease in previously reported results specified in the
letter or letters referred to in paragraph (d) of this Section 6 or (ii) any
change, or any development involving a prospective change, in or affecting the
condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Registration Statement, the Prospectus and the Incorporated
Documents (exclusive of any amendment or supplement thereto) the effect of
which, in any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Lead Manager, so material and adverse as to make it impractical
or inadvisable to proceed with the offering or delivery of the Shares as
contemplated by the Registration Statement (exclusive of any amendment thereof),
the Incorporated Documents and the Prospectus (exclusive of any amendment or
supplement thereto).  

 

(f)Payment of All Fees.  The Company shall have paid the required Commission
filing fees relating to the Shares within the time period required by
Rule 456(b)(1)(i) of the Act without regard to the proviso therein and otherwise
in accordance with Rules 456(b) and 457(r) of the Act and, if applicable, shall
have updated the “Calculation of Registration Fee” table in accordance with  

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Rule 456(b)(1)(ii) either in a post-effective amendment to the Registration
Statement or on the cover page of a prospectus filed pursuant to Rule 424(b).

 

(g)No FINRA Objections.  FINRA shall not have raised any objection with respect
to the fairness and reasonableness of the terms and arrangements under this
Agreement.  

 

(h)Shares Listed on Trading Market.  The Shares shall have been listed and
admitted and authorized for trading on the Trading Market, and satisfactory
evidence of such actions shall have been provided to the Lead Manager.  

 

(i)Other Assurances.  Prior to each Settlement Date and Time of Delivery, as
applicable, the Company shall have furnished to the Lead Manager such further
information, certificates and documents as the Lead Manager may reasonably
request. 

 

If any of the conditions specified in this Section 6 shall not have been
fulfilled when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be
reasonably satisfactory in form and substance to the Lead Manager and counsel
for the Lead Manager, this Agreement and all obligations of the Lead Manager
hereunder may be canceled at, or at any time prior to, any Settlement Date or
Time of Delivery, as applicable, by the Lead Manager. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.

 

The documents required to be delivered by this Section 6 shall be delivered at
the office of  Ellenoff Grossman & Schole LLP, counsel for the Lead Manager, at
1345 Avenue of the Americas, New York, New York 10105, on each such date as
provided in this Agreement.

 

7.Indemnification and Contribution.  

 

(a)Indemnification by Company.  The Company agrees to indemnify and hold
harmless the Managers, the directors, officers, employees and agents of the
Managers and each person who controls the Managers within the meaning of either
the Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement for the registration of the Shares as originally
filed or in any amendment thereof, or in the Base Prospectus, any Prospectus
Supplement, the Prospectus, any Issuer Free Writing Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not  

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misleading or result from or relate to any breach of any of the representations,
warranties, covenants or agreements made by the Company in this Agreement, and
agrees to reimburse each such indemnified party for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by the Managers specifically for inclusion therein. This indemnity
agreement will be in addition to any liability that the Company may otherwise
have.

 

(b)Indemnification by each Manager.  Each Manager, severally and not jointly
with the other Managers, agrees to indemnify and hold harmless the Company, each
of its directors, each of its officers who signs the Registration Statement, and
each person who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
each Manager, but only with reference to written information relating to such
Manager furnished to the Company by such Manager specifically for inclusion in
the documents referred to in the foregoing indemnity; provided, however, that in
no case shall a Manager be responsible for any amount in excess of the Broker
Fee applicable to the Shares and paid hereunder to such Manager. This indemnity
agreement will be in addition to any liability which the Managers may otherwise
have.  

 

(c)Indemnification Procedures.  Promptly after receipt by an indemnified party
under this Section 7 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 7, notify the indemnifying party in
writing of the commencement thereof; but the failure so to notify the
indemnifying party (i) will not relieve it from liability under paragraph (a)
or (b) above unless and to the extent it did not otherwise learn of such action
and such failure results in the forfeiture by the indemnifying party of
substantial rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above. The
indemnifying party shall be entitled to appoint counsel of the indemnifying
party’s choice at the indemnifying party’s expense to represent the indemnified
party in any action for which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for the fees and expenses
of any separate counsel retained by the indemnified party or parties except as
set forth below); provided, however, that such counsel shall be reasonably
satisfactory to the indemnified party. Notwithstanding the indemnifying party’s
election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including
local counsel), and the indemnifying party shall bear the reasonable fees, costs
and expenses of such separate counsel if (i) the use of counsel chosen by the  

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indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of the institution of such action or
(iv) the indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. An indemnifying party
will not, without the prior written consent of the indemnified parties, settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding.

 

(d)Contribution.  In the event that the indemnity provided in paragraph (a),
(b) or (c) of this Section 7 is unavailable to or insufficient to hold harmless
an indemnified party for any reason, the Company and each Manager, severally and
not jointly with the other Members, agree to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses reasonably
incurred in connection with investigating or defending the same) (collectively
“Losses”) to which the Company and a Manager may be subject in such proportion
as is appropriate to reflect the relative benefits received by the Company on
the one hand and by such Manager on the other from the offering of the Shares;
provided, however, that in no case shall a Manager be responsible for any amount
in excess of the Broker Fee applicable to the Shares and paid hereunder by such
Manager. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company and each Manager, severally and not
jointly with the other Managers, severally shall contribute in such proportion
as is appropriate to reflect not only such relative benefits but also the
relative fault of the Company on the one hand and of such Manager on the other
in connection with the statements or omissions which resulted in such Losses as
well as any other relevant equitable considerations. Benefits received by the
Company shall be deemed to be equal to the total net proceeds from the offering
(before deducting expenses) received by it, and benefits received by such
Manager shall be deemed to be equal to the Broker Fee applicable to the Shares
and paid hereunder as determined by this Agreement by such Manager. Relative
fault shall be determined by reference to, among other things, whether any
untrue or any alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information provided by the
Company on the one hand or the Manager on the other, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such untrue statement or omission. The Company  

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and the Manager agree that it would not be just and equitable if contribution
were determined by pro rata allocation or any other method of allocation which
does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7, each person who
controls the Manager within the meaning of either the Act or the Exchange Act
and each director, officer, employee and agent of the Manager shall have the
same rights to contribution as the Manager, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, each officer
of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this
paragraph (d).

 

8.Termination.  

 

(a)The Company shall have the right, by giving written notice as hereinafter
specified, to terminate the provisions of this Agreement relating to the
solicitation of offers to purchase the Shares in its sole discretion at any time
upon five (5) Business Days’ prior written notice. Any such termination shall be
without liability of any party to any other party except that (i) with respect
to any pending sale, through a Designated Manager for the Company, the
obligations of the Company, including in respect of compensation of the
Managers, shall remain in full force and effect notwithstanding the termination
and (ii) the provisions of Sections 5, 6, 7, 8, 9, 10, 12 and 14 of this
Agreement shall remain in full force and effect notwithstanding such
termination. 

 

(b)The Lead Manager shall have the right, by giving written notice as
hereinafter specified, to terminate the provisions of this Agreement relating to
the solicitation of offers to purchase the Shares in its sole discretion at any
time. Any such termination shall be without liability of any party to any other
party except that the provisions of Sections 5, 6, 7, 8, 9, 10, 12 and 14 of
this Agreement shall remain in full force and effect notwithstanding such
termination. 

 

(c)This Agreement shall remain in full force and effect until the earlier of
April 9, 2022 and such date that this Agreement is terminated pursuant to
Sections 8(a) or (b) above or otherwise by mutual agreement of the parties,
provided that any such termination by mutual agreement shall in all cases be
deemed to provide that Sections 5, 6, 7, 8, 9, 10, 12 and 14 shall remain in
full force and effect.  

 

(d)Any termination of this Agreement shall be effective on the date specified in
such notice of termination, provided that such termination shall not be
effective until the close of business on the date of receipt of such notice by
the Lead Manager or the Company, as the case may be. If such termination shall
occur prior  

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to the Settlement Date or Time of Delivery for any sale of the Shares, such sale
shall settle in accordance with the provisions of Section 2(b) of this
Agreement.

 

(e)In the case of any purchase of Shares by a Designated Manager pursuant to a
Terms Agreement, the obligations of such Designated Manager pursuant to such
Terms Agreement shall be subject to termination, in the absolute discretion of
the Designated Manager, by prompt oral notice given to the Company prior to the
Time of Delivery relating to such Shares, if any, and confirmed promptly by
facsimile or electronic mail, if since the time of execution of the Terms
Agreement and prior to such delivery and payment, (i) trading in the Company’s
Common Stock shall have been suspended by the Commission or the Trading Market
or trading in securities generally on the Trading Market shall have been
suspended or limited or minimum prices shall have been established on such
exchange, (ii) a banking moratorium shall have been declared either by Federal
or New York State authorities or (iii) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial
markets is such as to make it, in the sole judgment of the Designated Manager,
impractical or inadvisable to proceed with the offering or delivery of the
Shares as contemplated by the Prospectus (exclusive of any amendment or
supplement thereto).  

 

9.Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of the Manager set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by
the Manager or the Company or any of the officers, directors, employees, agents
or controlling persons referred to in Section 7, and will survive delivery of
and payment for the Shares.  

 

10.Notices. All communications hereunder will be in writing and effective only
on receipt, and will be mailed, delivered, emailed or facsimiled to the address
of the Company or the Managers, as applicable, set forth on the signature page
hereto.  

 

11.Successors. This Agreement will inure to the benefit of and be binding upon
the parties hereto and their respective successors and the officers, directors,
employees, agents and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.  

 

12.No Fiduciary Duty. The Company hereby acknowledges that (a) the purchase and
sale of the Shares pursuant to this Agreement is an arm’s-length commercial
transaction between the Company, on the one hand, and the Managers and any
affiliate through which it may be acting, on the other, (b) each Manager is
acting solely as sales agent and/or principal in connection with the purchase
and sale of the Company’s securities and not as a fiduciary of the Company and
(c) the Company’s engagement of the Managers in connection with the offering and
the process leading up to the offering is as independent contractors and not in
any other capacity. Furthermore, the Company agrees that it is solely
responsible for making its own judgments in connection with the offering
(irrespective of  

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whether a Manager has advised or is currently advising the Company on related or
other matters). The Company agrees that it will not claim that the Managers have
rendered advisory services of any nature or respect, or owe an agency, fiduciary
or similar duty to the Company, in connection with such transaction or the
process leading thereto.

 

13.Integration. This Agreement and any Terms Agreement supersede all prior
agreements and understandings (whether written or oral) between the Company and
the Managers with respect to the subject matter hereof.  

 

14.Applicable Law. This Agreement and any Terms Agreement will be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.  If either
party shall commence an action or proceeding to enforce any provision of this
Agreement, then the prevailing party in such action or proceeding shall be
reimbursed by the other party for its reasonable attorney’s fees and other costs
and expenses incurred with the investigation, preparation and prosecution of
such action or proceeding. Each of the Company and each of the Managers: (i)
agrees that any legal suit, action or proceeding arising out of or relating to
this Agreement shall be instituted exclusively in New York Supreme Court, County
of New York, or in the United States District Court for the Southern District of
New York, (ii) waives any objection which it may have or hereafter to the venue
of any such suit, action or proceeding, and (iii) irrevocably consents to the
jurisdiction of the New York Supreme Court, County of New York, and the United
States District Court for the Southern District of New York in any such suit,
action or proceeding.  Each of the Company and the Managers further agrees to
accept and acknowledge service of any and all process which may be served in any
such suit, action or proceeding in the New York Supreme Court, County of New
York, or in the United States District Court for the Southern District of New
York and agrees that service of process upon the Company mailed by certified
mail to the Company’s address shall be deemed in every respect effective service
of process upon the Company, in any such suit, action or proceeding, and service
of process upon the Managers mailed by certified mail to each Manager’s address
shall be deemed in every respect effective service process upon such Manager, in
any such suit, action or proceeding. If either party shall commence an action or
proceeding to enforce any provision of this Agreement, then the prevailing party
in such action or proceeding shall be reimbursed by the other party for its
reasonable attorney’s fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding. 

 

15.WAIVER OF JURY TRIAL. THE COMPANY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY TERMS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.  

 

16.Counterparts. This Agreement and any Terms Agreement may be signed in one or
more counterparts, each of which shall constitute an original and all of which  

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together shall constitute one and the same agreement, which may be delivered by
facsimile or in .pdf file via e-mail.

 

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17.Headings. The section headings used in this Agreement and any Terms Agreement
are for convenience only and shall not affect the construction hereof.  

         

If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and each Manager.

 

Very truly yours,

 

URANIUM ENERGY CORP.

 

 

By:_/s/ Amir Adnani__________________

Name:  Amir Adnani

Title:    President and Chief Executive Officer

 

Address for Notice:

 

Suite 1830 – 1030 West Georgia Street, Vancouver, British Columbia, Canada, V6E
2Y3

Attention:  Amir Adnani, President and CEO

 

The foregoing Agreement is hereby confirmed and accepted as of the date first
written above.

 

LEAD MANAGER:

 

H.C. WAINWRIGHT & CO., LLC

 

 

By:_/s/ Edward Silvera_______________

Name: Edward Silvera

Title: Chief Operating Officer

 

Address for Notice:

430 Park Avenue, 4th Floor. New York, New York, USA, 10022

Attention:  Edward Silvera, Chief Operating Officer

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CO-MANAGERS:

 

TD SECURITIES (USA) LLC

 

 

By:_/s/ Dorian Cochran________

Name:  Dorian Cochran

Title:    Managing Director, Investment Banking

 

Address for Notice:

 

31 West 52nd Street, New York, NY, U.S.A.  10019-6101

Attention:  Dorian Cochran

 

HAYWOOD SECURITIES (USA) INC.

 

 

By:_/s/ Robert Blanchard_______

Name:  Robert Blanchard

Title:    President and CEO

 

Address for Notice:

 

Suite 700, 200 Burrard Street, Vancouver, British Columbia, Canada, V6C 3L6

Attention:  

 

ROTH CAPITAL PARTNERS, LLC

 

 

By:_/s/ J. Barry_______________

Name:  Joseph (J.) Barry

Title:    Managing Director

 

Address for Notice:

 

888 San Clemente Drive, Newport Beach, California, 92660

Attention:  Joseph (J.) Barry, Managing Director

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EIGHT CAPITAL CORP.

 

 

By:_/s/ Jason Yeung__________

Name:  Jason Yeung

Title:    Managing Director, Investment Banking

 

Address for Notice:

 

Suite 2900, 100 Adelaide Street West, Toronto, Ontario, Canada, M5H 1S3

Attention:  Jason Yeung, Managing Director, Investment Banking

 

CORMARK SECURITIES (USA) LIMITED

 

 

By:_/s/ Jeff Kennedy__________

Name:  Jeff Kennedy

Title:    Managing Director, Equity Capital Markets and Operations

 

Address for Notice:

 

200 Bay Street, Suite 2800, Toronto, Ontario, Canada, M5J 2J2

Attention:  Jeff Kennedy

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Form of Terms Agreement

ANNEX I

URANIUM ENERGY CORP. TERMS AGREEMENT

 

Dear Sirs:

 

    Uranium Energy Corp. (the “Company”) proposes, subject to the terms and
conditions stated herein and in the At The Market Offering Agreement, dated
April 9, 2019 (the “At The Market Offering Agreement”), between the Company and
H.C. Wainwright & Co., LLC as lead manager and the Co-Managers (as defined
therein) (collectively, the “Agents” and each, an “Agent”), to issue and sell to
Agent the securities specified in the Schedule I hereto (the “Purchased
Shares”).  

 

     Each of the provisions of the At The Market Offering Agreement not
specifically related to the solicitation by the Agent, as agent of the Company,
of offers to purchase securities is incorporated herein by reference in its
entirety, and shall be deemed to be part of this Terms Agreement to the same
extent as if such provisions had been set forth in full herein. Each of the
representations and warranties set forth therein shall be deemed to have been
made at and as of the date of this Terms Agreement and the Time of Delivery,
except that each representation and warranty in Section 3 of the At The Market
Offering Agreement which makes reference to the Prospectus (as therein defined)
shall be deemed to be a representation and warranty as of the date of the At The
Market Offering Agreement in relation to the Prospectus, and also a
representation and warranty as of the date of this Terms Agreement and the Time
of Delivery in relation to the Prospectus as amended and supplemented to relate
to the Purchased Shares.  

 

     An amendment to the Registration Statement (as defined in the At The Market
Offering Agreement), or a supplement to the Prospectus, as the case may be,
relating to the Purchased Shares, in the form heretofore delivered to the Agent
is now proposed to be filed with the Securities and Exchange Commission.  

 

     Subject to the terms and conditions set forth herein and in the At The
Market Offering Agreement which are incorporated herein by reference, the
Company agrees to issue and sell to Agent and the latter agrees to purchase from
the Company the number of shares of the Purchased Shares at the time and place
and at the purchase price set forth in the Schedule I hereto.  

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          If the foregoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, whereupon this Terms Agreement, including
those provisions of the At The Market Offering Agreement incorporated herein by
reference, shall constitute a binding agreement between the Agent and the
Company.

 

 

 

 

 

URANIUM ENERGY CORP.

 

 

 

By:__________________________________________

    Name: Amir Adnani

    Title: President, CEO and a director

 

ACCEPTED as of the date first written above.

 

 

 

 

 

DESIGNATED MANAGER (One of):

 

H. C. WAINWRIGHT & CO., LLC

 

 

 

By:__________________________________________

    Name:

    Title:

 

TD SECURITIES (USA) LLC

 

 

 

By:__________________________________________

    Name:

    Title:

 

HAYWOOD SECURITIES (USA) INC.

 

 

 

By:__________________________________________

    Name:

    Title:

 

ROTH CAPITAL PARTNERS, LLC

 

 

 

By:__________________________________________

    Name:

    Title:

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EIGHT CAPITAL CORP.

 

 

 

By:__________________________________________

    Name:

    Title:

 

CORMARK SECURITIES (USA) LIMITED

 

 

 

By:__________________________________________

    Name:

    Title:

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