Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase Agreement (the “Agreement”) is made as of November 2,
2018 by and among Trans-Lux Corporation, a Delaware corporation (the “Company”),
and Unilumin North America Inc., a Delaware corporation (the “Purchaser”).

RECITALS

 

A.        The Company has authorized the sale and issuance of up to 1,315,789
shares of the Company’s common stock, par value $0.001 per share (the “Common
Stock”), and a warrant to purchase 5,670,103 shares of the Company’s common
stock at an initial exercise price of $0.97 per share (the “Warrant”, and with
the Common Stock, the “Securities”), the form of which is attached hereto as
Exhibit A. 

B.        Subject to the terms and conditions set forth in securities purchase
agreements substantially similar to this Agreement and pursuant to Section 4(2)
of the Securities Act of 1933, as amended (the “Securities Act”), and the
provisions of Regulation D promulgated thereunder (“Regulation D”), the Company
desires to issue and sell the Securities to the Purchaser in a private placement
offering as more fully set forth herein (the “Offering”).

C.        The Purchaser desires to purchase, and the Company desires to issue
and sell, the Securities subscribed for by Purchaser, on the terms and
conditions set forth herein.

 

AGREEMENT

 

In consideration of the mutual promises contained herein and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties to
this Agreement agree as follows:

ARTICLE I

DEFINITIONS

 

            Section 1.  Definitions.  In addition to the terms defined elsewhere
in this Agreement the following terms have the meanings set forth in this
Section 1:

“Closing” shall mean the closing of the Offering contemplated by this Agreement.

“Closing Date” means the date of the Closing under this Agreement.

“Commission” means the United States Securities and Exchange Commission.

“Company Counsel” means Olshan Frome Wolosky LLP, 1325 Avenue of the Americas,
New York, NY 10019.

“Company’s Knowledge” or any other similar knowledge qualification, means the
actual knowledge of any named executive officer of the Company.

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

“Material Adverse Effect” means any event, occurrence, fact, condition or change
that is, or could reasonably be expected to become, individually or in the
aggregate, materially adverse to the business, results of operations, condition
(financial or otherwise) or assets of the Company and its Subsidiaries, taken as
a whole; provided, however, that “Material Adverse Effect” shall not include any
event, occurrence, fact, condition or change, directly or indirectly, arising
out of or attributable to: (i) general economic or political conditions; (ii)
conditions generally affecting the industries in which the Company operates;
(iii) any changes in financial or securities markets in general; (iv) acts of
war (whether or not declared), armed hostilities or terrorism, or the escalation
or worsening thereof; (v) any action required or permitted by this Agreement;
(vi) any changes in applicable Laws or accounting rules, including GAAP; or
(vii) the public announcement, pendency or completion of the transactions
contemplated by this Agreement; provided further, however, that any event,
occurrence, fact, condition or change referred to in clauses (i) through (iv)
immediately above shall be taken into account in determining whether a Material
Adverse Effect has occurred or could reasonably be expected to occur to the
extent that such event, occurrence, fact, condition or change has a
disproportionate effect on the Company and its Subsidiaries, taken as a whole,
compared to other participants in the industries in which the Company conducts
its businesses.

 

“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or subdivision thereof) or other entity
of any kind.

 

“Subscription Amount” shall mean, as to the Purchaser, the aggregate amount to
be paid for the Securities purchased hereunder in United States dollars and in
immediately available funds.

 

“Transaction Documents” means this Agreement and any ancillary documents related
to this Agreement described herein.

 

ARTICLE II

PURCHASE AND SALE OF SECURITIES

 

            Section 2.  Purchase and Sale of Securities. 

2.1             Sale and Issuance.  On the Closing Date, upon the terms and
subject to the conditions set forth herein, substantially concurrent with the
execution and delivery of this Agreement by Purchaser, the Company agrees to
sell, and Purchaser agrees to purchase, 1,315,789 shares of Common Stock, for an
aggregate purchase price equal to Purchaser’s Subscription Amount of
$1,500,000.00, representing a purchase price per each share of Common Stock of
$1.14, and the Warrant. 

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2.2            Closing.  Upon satisfaction of the covenants and conditions set
forth in Sections 2.3 and 2.4, the Closing shall occur at the offices of the
Company Counsel or such other location or such other manner (including by
electronic means) as the parties shall mutually agree.

2.3            Deliveries. 

(a)                On the Closing Date, the Company shall deliver or cause to be
delivered to the Purchaser (or such other Person, as specifically provided
below) the following:

(i)              this Agreement duly executed by the Company;

(ii)            a legal opinion of Company Counsel in such form as is reasonably
acceptable to Purchaser;

(iii)          a certificate evidencing 1,315,789 shares of Common Stock in the
name of Purchaser; and

(iv)          the Warrant duly executed by the Company.

(b)               On the Closing Date, the Purchaser shall deliver or cause to
be delivered to the Company the following:

(i)              this Agreement duly executed by the Purchaser; and

(ii)            Purchaser’s Subscription Amount by wire transfer or certified
check payable to the Company.

2.4            Closing Conditions. 

(a)                The obligations of the Company hereunder in connection with
Closing are subject to the following conditions being met:

(i)              the accuracy in all material respects on the Closing Date, of
the representations and warranties of Purchaser contained herein;

(ii)            approval of the board of the directors of the Company of the
issuance of the Common Stock and the Warrant and all other provisions and
agreements set forth in this Agreement;

(iii)          all obligations, covenants and agreements of Purchaser required
to be performed at or prior to the Closing Date, shall have been performed or
waived; and

(iv)          the delivery by Purchaser of the items set forth in Section 2.3(b)
of this Agreement.

(b)               The obligations of Purchaser hereunder in connection with the
Closing are subject to the following conditions being met:

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(i)        the accuracy in all material respects when made and on the Closing
Date, of the representations and warranties of the Company contained herein;

(ii)       all obligations, covenants and agreements of the Company required to
be performed at or prior to the Closing Date, shall have been performed or
waived;

(iii)      the delivery by the Company of the items set forth in Section 2.3(a)
of this Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

            Section 3. Representations and Warranties of the Company.  The
Company hereby represents, warrants and covenants to the Purchaser that:

3.1       Organization, Good Standing and Qualification.  The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware, has qualified to do business in all jurisdictions in
which the absence of such qualification would have a Material Adverse Effect,
and has all necessary power and authority to enter into this Agreement, to carry
out its obligations hereunder and to consummate the transactions contemplated
hereby and to conduct its business.  The execution and delivery of this
Agreement by the Company, the performance by the Company of its obligations
hereunder and the consummation by the Company of the transactions contemplated
hereby have been duly authorized by all requisite corporate action on the part
of the Company. This Agreement has been duly executed and delivered by the
Company, and (assuming due authorization, execution and delivery by the
Purchaser) this Agreement constitutes a legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its terms, except
as limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, and any other laws of general application affecting
enforcement of creditors’ rights generally, and as limited by laws relating to
the availability of a specific performance, injunctive relief, or other
equitable remedies.

3.2             No Conflict.  The execution, delivery and performance of this
Agreement, and the Registration Rights Agreement by the Company and the issuance
of the Securities contemplated hereby do not and will not: (i) violate, conflict
with or result in the breach of any provision of the certificate of
incorporation or by-laws of the Company (the “Company Charter Documents”) as in
effect on the date hereof; (ii) materially conflict with or violate any law or
governmental order as in effect on the date hereof applicable to the Company, or
any of its assets, properties or businesses; or (iii) conflict with, result in
any breach of, constitute a default (or event which with the giving of notice or
lapse of time, or both, would become a default) under, require any consent
under, or give to others any rights of termination, amendment, acceleration of
performance required by, suspension, revocation or cancellation of any rights
pursuant to, any material note, bond, mortgage or indenture, contract,
agreement, lease, sublease, license, permit, franchise or other instrument or
arrangement as in effect on the date hereof to which the Company is a party or
by which any of Company’s assets or properties is bound or affected, which
individually or in the aggregate would have a Material Adverse Effect.

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3.3            Subsidiaries.  A true and correct listing of all of the Company’s
subsidiaries as of December 31, 2017 is set forth in Exhibit 21 of the Company’s
Annual Report on Form 10-K for the fiscal year ended December 31, 2017.  The
subsidiaries on such list shall be collectively referred to herein as
“Subsidiaries”. Except as set forth in the SEC Reports (as hereinafter defined),
the Company owns, directly or indirectly, all of the capital stock or other
equity interests of each Subsidiary free and clear of any Liens, and all of the
issued and outstanding shares of capital stock of each Subsidiary are validly
issued and are fully paid, non-assessable and free of preemptive and similar
rights to subscribe for or purchase securities. There are no outstanding (a)
securities of the Company or any Subsidiary convertible into or exchangeable for
shares of capital stock or voting securities of any Subsidiary or (b) options or
other rights to acquire from the Company or any Subsidiary, or other obligation
of the Company or any Subsidiary to issue, any capital stock, voting securities
or securities convertible into or exchangeable for capital stock or voting
securities of any Subsidiary (the items in clauses (a) and (b) being referred to
collectively as the “Subsidiary Securities”). There are no outstanding
obligations of the Company or any Subsidiary to repurchase, redeem or otherwise
acquire any outstanding Subsidiary Securities.

3.4             Authorized Capital Stock.  As of the date hereof and immediately
prior to the issuance of the Preferred Stock hereunder, the authorized capital
stock of the Company consists of (i) 10,000,000 shares of common stock, of which
as of the date hereof, 2,337,024 shares are issued and 2,309,184 are
outstanding, and (ii) 500,000 shares of preferred stock, par value $0.001 per
share, of which (A) 416,500 shares are designated as “Series A Convertible
Preferred Stock,” having a par value of $1.00 per share and a stated value of
$20.00 per share, of which as of the date hereof no shares are issued or
outstanding, and (B) 51,000 shares are designated as “Series B Convertible
Preferred Stock,” of which as of the date hereof 16,512 shares are issued or
outstanding. All of the outstanding shares have been validly issued and are
fully paid and nonassessable. No shares of common stock are subject to
preemptive rights or any other similar rights or any liens or encumbrances
suffered or permitted by the Company. Except as set forth in the SEC Reports (as
defined below), as of the date hereof, (i) there are no outstanding options
(except for options granted under the Company’s existing equity incentive
plans), warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible into, any
shares of capital stock of the Company, or contracts, commitments,
understandings or arrangements by which the Company is or may become bound to
issue additional shares of capital stock of the Company and (ii) there are no
agreements or arrangements under which the Company is obligated to register the
sale of any of its securities under the Securities Act.  Except as set forth in
the SEC Reports, there are no securities or instruments containing anti-dilution
or similar provisions that will be triggered by the issuance of any of the
Securities as described in this Agreement. The Company has furnished to the
Purchaser true and correct copies of the Company Charter Documents, as in effect
on the date hereof.

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3.5             Governmental Consents.  Except as may be required by the
Securities Act, the Exchange Act and applicable state securities laws, no
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or local
governmental authority on the part of the Company is required in connection with
the consummation of the transactions contemplated by this Agreement.

3.6             Private Placement.  Subject to the truth and accuracy of the
Purchaser’s representations set forth in this Agreement, the offer, sale and
issuance of the Securities as contemplated by this Agreement is exempt from the
registration requirements of the Securities Act, and neither the Company nor any
authorized agent acting on its behalf will take any action hereafter that would
cause the loss of such exemption.

3.7             Issuance and Delivery of the Securities.  The Securities have
been duly authorized by the Company and, when issued, sold and delivered in
accordance with this Agreement, the Securities will be (i) validly issued, fully
paid and nonassessable, and (ii) free from all taxes, liens and charges with
respect to the issue thereof, and shall not be subject to preemptive rights or
other similar rights of shareholders of the Company or any liens or
encumbrances. Other than the requirement that the Company increase its
authorized Common Stock, the shares of Common Stock issuable upon exercise of
the Warrant have been duly authorized and reserved by the Company, and, when
issued upon conversion in accordance with the Warrant, will be validly issued,
fully paid and nonassessable.

3.8             SEC Reports; Financial Statements. The Company has filed all
reports, schedules, forms, statements and other documents required to be filed
by the Company under the Securities Act and the Exchange Act, including pursuant
to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof
(or such shorter period as the Company was required by law or regulation to file
such material) (the foregoing materials, including the exhibits thereto and
documents incorporated by reference therein, being collectively referred to
herein as the “SEC Reports”) on a timely basis or has received a valid extension
of such time of filing and has filed any such SEC Reports prior to the
expiration of any such extension. As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Securities Act
and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. The Company has never been an issuer subject to Rule 144(i) under
the Securities Act. The financial statements of the Company included in the SEC
Reports comply in all material respects with applicable accounting requirements
and the rules and regulations of the Commission with respect thereto as in
effect at the time of filing. Such financial statements have been prepared in
accordance with United States generally accepted accounting principles applied
on a consistent basis during the periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the notes thereto and except
that unaudited financial statements may not contain all footnotes required by
GAAP, and fairly present in all material respects the financial position of the
Company and its consolidated Subsidiaries as of and for the dates thereof and
the results of operations and cash flows for the periods then ended, subject, in
the case of unaudited statements, to normal, immaterial, year-end audit
adjustments.

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3.9             Absence of Certain Changes.  Since June 30, 2018, except as
disclosed in the SEC Reports filed prior to the Closing Date or as set forth on
Schedule 3.9 attached hereto,1 there has not been:

(a)              any change in the assets, liabilities, condition (financial or
otherwise), affairs, earnings, business or operations of the Company from that
reflected in the financial statements referred to in Section 3.8 above, except
for changes in the ordinary course of business which, either individually or in
the aggregate, have not had, or may be reasonably expected to result in, a
Material Adverse Effect;

(b)              any incurrence of liabilities or obligations by the Company,
contingent or otherwise, whether due or to become due, whether by way of
guaranty, endorsement, indemnity, warranty, or otherwise, except liabilities and
obligations incurred in the ordinary course of business, none of which has had,
or is reasonably likely to result in, a Material Adverse Effect;

(c)               any hiring by the Company of any new officer or any material
increase in compensation of any of its existing officers, or the rate of pay of
its employees as a group (except as part of regular compensation increases in
the ordinary course of business), or any material change of such officers’ or
employees’ employment agreements or of any benefit plan relating to the
Company’s employees;

(d)              any resignation or termination of employment of any officer of
the Company and the Company has not received any written notice of the impending
resignation or termination of employment of any such officer;

(e)               any change in the accounting methods or practices followed by
the Company;

(f)               any issuance of any stock, bonds, or other securities of the
Company or options, warrants, or rights or agreements or commitments to purchase
or issue such securities or grant such options, warrants or rights, except for
those issuances contemplated or permitted by the Transaction Documents;

(g)              any changes to the Company Charter Documents; or

(h)              any material change to a material contract or arrangement by
which the Company or any of its assets is bound or subject which, either
individually or, in the aggregate, has had or may be reasonably expected to,
result in a Material Adverse Effect.

                                                                                     

1 Purchaser to signoff on schedule of reserves.

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3.10        No Material Adverse Effect.  Since the Balance Sheet Date, and other
than in the ordinary course of business consistent with past practice, (a) there
has not been, with respect to the Company, any event, occurrence or development
that has had, or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect; (b) the Company has not incurred any
liabilities (contingent or otherwise) other than (i) trade payables and accrued
expenses incurred in the ordinary course of business consistent with past
practice, (ii) current liabilities (within the meaning of GAAP) incurred since
the Balance Sheet Date in the ordinary course of business consistent in nature
and amount with past practice and which are not material in amount, (iii)
liabilities not required to be reflected in the Company’s financial statements
pursuant to GAAP or disclosed in filings made with the Commission, or (iv) as
set forth in Schedule 3.10 attached hereto; (c) the Company has not altered its
method of accounting, (d) 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, except as set forth in Schedule 3.10 attached hereto and (e) the Company
has not issued any equity securities to any officer, director or affiliate,
except pursuant to existing Company stock option plans or as disclosed in SEC
Reports.  Except for the issuance of the Securities contemplated by this
Agreement and as otherwise set forth, or to be set forth, in the Company’s SEC
Reports, no event, liability, fact, circumstance, occurrence or development has
occurred or exists or is reasonably expected to occur or exist with respect to
the Company or its Subsidiaries or their respective businesses that would be
required to be disclosed by the Company under applicable securities laws. The
Company represents and warrants that, except as set forth in Schedule 3.10
attached hereto or in the SEC Reports, there has been no material adverse
development from the date of filing of the Company’s Annual Report on Form 10-K
for the twelve month period ending on December 31, 2017 in terms of assets,
liabilities, results of operations, cash flow and business conditions of the
Company and its subsidiaries taken as a whole.

3.11         Litigation.  Except as disclosed in the SEC Reports, (a) there are
no suits, actions, proceedings or investigations pending or, to the Company's
knowledge, threatened, against the Company before any governmental authority
that, individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect or prevent or materially delay the consummation of the
transactions contemplated by this Agreement; and (b) the Company is not subject
to any outstanding judgment, order, writ, injunction or decree that could,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect or prevent or materially delay the consummation of the
transactions contemplated by this Agreement.

3.12         Governmental Regulation.  The Company is not subject to regulation
under the Investment Company Act of 1940, or to any United States of America,
state or local statute or regulation limiting its ability to incur indebtedness.

3.13          Finders’ Fees.  There is no investment banker, broker, finder or
other intermediary that has been retained by or is authorized to act on behalf
of the Company who might be entitled to any fee or commission from the Purchaser
upon consummation of the transactions contemplated by this Agreement.

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3.14         Insurance.  The Company currently carries policies or binders of
fire, liability, umbrella liability, real and personal property, workers’
compensation, vehicular, directors and officers’ liability, and other casualty
and property insurance maintained by the Company or its affiliates and relating
to the assets, business, operations, employees, officers and directors of the
Company (collectively, the “Insurance Policies”). Such Insurance Policies are in
full force and effect and shall remain in full force and effect following the
consummation of the transactions contemplated by this Agreement. To the
Company’s Knowledge, the insurance coverage provided by such policies is
customary for the industry in which the Company and the Subsidiaries
operate. Each of the Company and the Subsidiaries has complied with the
provisions of each such policy under which it is an insured party, except for
instances of noncompliance that individually or in the aggregate would not
reasonably be expected to have a Material Adverse Effect. There are no pending
or, to the Company’s Knowledge, threatened claims under any insurance policy
that individually or in the aggregate have had or would reasonably be expected
to have a Material Adverse Effect.

3.15         Permits.  The Company and its Subsidiaries possess all Permits
necessary for the present conduct of their respective businesses, other than
where the failure to have such Permits would not reasonably be expected to cause
a Material Adverse Effect.

3.16          Compliance With Laws.  To the Company’s Knowledge, and except as
disclosed in the SEC reports, the Company is currently in compliance with all
laws applicable to it or its business, properties or assets, except where
non-compliance would not, individually or in the aggregate, have a Material
Adverse Effect. Without limiting the generality of the foregoing, the Company
has not, and, to the Company’s Knowledge, none of its affiliates or
representatives has, taken, directly or indirectly, any overt action designed to
cause or to result in the stabilization or manipulation of the price of any
security of the Company to facilitate the transactions contemplated hereby.

3.17          Hazardous Substance or Waste. Except as disclosed in the SEC
Reports, the Company has not treated, stored, disposed of, arranged for or
permitted the disposal of, transported, handled, or released any substance,
including without limitation any hazardous substance, on  any property leased by
the Company in a manner that has given or would give rise to liabilities,
including any liability for response costs, corrective action costs, personal
injury, property damage, natural resources damages or attorney fees, pursuant to
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, the Solid Waste Disposal Act, as amended or any other
Environmental, Health, and Safety Requirements. The Company has not received any
communication (written or oral), whether from a governmental authority or
employee, that alleges that the Company is not in full compliance with
environmental laws, or that the Company are otherwise subject to liability under
environmental laws, and to the best of the Company’s Knowledge, there are no
circumstances that may prevent or interfere with such full compliance in the
future. There is no environmental claim pending or, threatened against the
Company.

3.18         Material Contracts.  All material contracts, plans and arrangements
to which the Company or any Subsidiary is a party or any of their respective
properties or assets is subject that are required to be filed as an exhibit to
any SEC Report have been so filed with the Commission (such documents, the
“Material Contracts”). All the Material Contracts are valid and in full force
and effect, except to the extent they have previously expired or terminated in
accordance with their terms and except for any invalidity or failure to be in
full force and effect that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. To the Company’s
Knowledge, none of the Company or any Subsidiary is in violation of or default
(with or without notice or lapse of time or both) under, or has waived or failed
to enforce any rights or benefits under, any Material Contract, except for
violations, defaults, waivers or failures to enforce rights or benefits that
individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect. To the Company’s Knowledge, no other party to any
Material Contract is in breach thereof or default thereunder, except for
breaches or defaults that individually or in the aggregate would not reasonably
be expected to have a Material Adverse Effect.

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3.19          Title to Assets.  To the Company’s Knowledge, each of the Company
and its Subsidiaries has good, valid and marketable title to, or in the case of
leased properties and assets, valid leasehold interests in, all the assets and
properties that it owns or uses and that are reflected on the Balance Sheet, or
that were thereafter acquired (except for assets and properties sold, consumed
or otherwise disposed of in the ordinary course of business since such date)
except where the failure to have such title or valid leaseholds would not
reasonably be expected to have a Material Adverse Effect.

3.20          Taxes.

(a)              The Company has timely filed all tax returns that it was
required to file as of the Balance Sheet Date. To the Company’s Knowledge at the
time of such filings, all such tax returns were complete and correct in all
material respects.  All taxes shown as due on any tax return by the Company have
been, to the Company’s Knowledge, timely paid, duly provided for, or are being
contested in good faith by appropriate proceedings. The Company has disclosed to
the Purchaser material tax issues that are being contested. Any non-disclosure
of the tax issues would not reasonably be expected to have a Material Adverse
Effect.

(b)             The Company has withheld and paid each tax required to have been
withheld and paid in connection with amounts paid or owing to any employee,
independent contractor, creditor, customer, shareholder or other party, and
complied in all material respects with all information reporting and backup
withholding provisions of applicable law, except where non-compliance would not,
individually or in the aggregate, have a Material Adverse Effect.

(c)              Since December 31, 2017, no extensions or waivers of statutes
of limitations have been given or requested with respect to any taxes of the
Company.

(d)             The Company is not a party to any action by any taxing
authority.  There are no pending or threatened actions by any taxing authority.

3.21         Intellectual Property.  To the Company’s Knowledge, the Company and
the Subsidiaries own a valid right, title, interest or license in and to the
intellectual property necessary or material for the operation of their
respective businesses, which includes all patents, patent applications,
provisional patents, copyrights, common law copyrights, trade names, trademarks,
service marks, technology, customer lists, internet domain names, know-how,
processes, or any other intangible property rights, including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems, procedures or registrations or applications relating to the same
(“Intellectual Property”), except where the failure to so have would not,
individually or in the aggregate, have a Material Adverse Effect. To the
Company’s Knowledge, neither the Company nor any Subsidiary has violated or
infringed upon the Intellectual Property rights of any other Person. There are
no claims pending or, to the Company’s Knowledge, threatened against the Company
or any Subsidiary regarding any claim or infringement of any Intellectual
Property belonging to any other Person and the Company has not received any
notice (written or otherwise) of any claim of any such infringement. To the
Company’s Knowledge, all such Intellectual Property rights are enforceable and
there is no existing infringement by another Person of any of the Intellectual
Property rights.

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3.22          Certain Securities Law Matters.

(a)              Neither the Company nor any of its Affiliates, or any person
acting on its or their behalf, directly or indirectly, has conducted or will
conduct any general solicitation or general advertising (as those terms are used
in Regulation D as promulgated by the Commission under the Securities Act) in
connection with the offer or sale of any of the Securities.

(b)             Subject to the accuracy of Purchaser’s representations and
warranties set forth in Article IV, the offer and sale of the Securities by the
Company to Purchaser on the Closing Date will not require registration under the
Securities Act or any applicable state securities law. The Company is issuing
the Securities in accordance with and in reliance upon the exemption from
securities registration afforded, inter alia, by Rule 506 under Regulation D as
promulgated by the Commission under the Securities Act.

3.23         Affiliate Transactions.  Except as disclosed in the SEC Reports,
there have been no transactions, agreements, arrangements or understandings
between the Company or any Subsidiary, on the one hand, and their respective
directors, officers or affiliates, on the other hand, that would be required to
be disclosed under Item 404 of Regulation S-K as promulgated by the Commission
under the Exchange Act.

3.24         Anti-Corruption Laws.  None of the Company or its Subsidiaries, and
to the Company’s Knowledge, any of its respective officers, directors, agents or
employees have, directly or indirectly, made or authorized any contribution,
payment or gift of funds, or property to any official, employee or agent of any
governmental agency, authority or instrumentality in any jurisdiction where
either the payment or gift or the purposes of such contribution, payment or gift
was, is, or will be prohibited under applicable law of any relevant locality at
the time of such contribution, payment or gift, including without limitation,
the U.S. Foreign Corrupt Practices Act of 1977, as amended, and the rules and
regulations promulgated thereunder and any other applicable anti-bribery or
anti-corruption laws or regulations of any jurisdiction.

3.25         No Other Representations or Warranties.  Except for the
representations and warranties contained in this Article III, neither the
Company nor any other Person has made or makes any other express or implied
representation or warranty, either written or oral, on behalf of the Company.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PURCHASER

 

            Section 4.  Representations and Warranties of the Purchaser. 
Purchaser hereby represents and warrants to the Company, agreeing and
acknowledging that this Agreement is entered into by the Company in reliance
upon Purchaser’s representation to the Company, as follows:

4.1             Authorization.  Purchaser has all necessary power and authority
to execute and deliver this Agreement and to carry out its provisions. All
action on Purchaser’s part required for the lawful execution and delivery of
this Agreement has been taken. This Agreement, when executed and delivered by
the Purchaser, will constitute valid and legally binding obligations of the
Purchaser, enforceable in accordance with its terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, and any other laws of general application affecting enforcement of
creditors’ rights generally, and as limited by laws relating to the availability
of a specific performance, injunctive relief, or other equitable remedies.

4.2             Purchase Entirely for Own Account.  This Agreement is made with
the Purchaser in reliance upon the Purchaser’s representation to the Company,
which by the Purchaser’s execution of this Agreement, the Purchaser hereby
confirms, that the Securities to be acquired by the Purchaser will be acquired
for investment for the Purchaser’s own account, not as a nominee or agent, and
not with a view to the resale or distribution of any part thereof, and that the
Purchaser has no present intention of selling, granting any participation in, or
otherwise distributing the same. By executing this Agreement, the Purchaser
further represents that the Purchaser does not presently have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
participations to such person or to any third person, with respect to any of the
Securities. The Purchaser has not been formed for the specific purpose of
acquiring any of the Securities.

4.3             Knowledge.  The Purchaser is aware of the Company’s business
affairs and financial condition and has acquired sufficient information about
the Company to reach an informed and knowledgeable decision to acquire the
Securities.

4.4             No Public Market.  The Purchaser understands that no public
market now exists for any of the securities issued by the Company other than the
Common Stock, that the Company has made no assurances that a public market will
ever exist for the Securities, other than the Common Stock.

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4.5             Legends.  The Purchaser understands that the Securities, and any
securities issued in respect thereof or exchange therefor, may bear one or all
of the following legends:

“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS (THE
“ACTS”).  NO INTEREST MAY BE SOLD, ENCUMBERED OR OTHERWISE TRANSFERRED UNLESS
(A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACTS COVERING THE
TRANSACTION, (B) THIS CORPORATION RECEIVES AN OPINION OF LEGAL COUNSEL
SATISFACTORY TO THIS CORPORATION STATING THAT REGISTRATION IS NOT REQUIRED UNDER
THE ACTS, OR (C) THIS CORPORATION OTHERWISE SATISFIES ITSELF THAT REGISTRATION
IS NOT REQUIRED UNDER THE ACTS.” 

Any legend required by the Blue Sky laws of any state to the extent such laws
are applicable to the shares represented by the certificate so legended.

4.6            Accredited Investor.  The Purchaser is an accredited investor as
defined in Rule 501(a) of Regulation D promulgated under the Securities Act.

Purchaser makes one or more of the following representations regarding its
status as an “accredited investor” and certain related matters, and has checked
the applicable representation:

o         (i)        If Purchaser is an individual, a self-directed individual
retirement account or a living trust, Purchaser represents that it (A) has an
individual net worth, or a joint net worth with such individual’s spouse, in
excess of $1,000,000, or (B) has had an individual income in excess of $200,000
in each of the two most recent years, or a joint income with one’s spouse in
excess of $300,000 in each of those years, and has a reasonable expectation of
reaching the same income level in the current year, or (C) is a director or
executive officer of the Company.

o         (ii)       Purchaser is a bank, insurance partnership, investment
partnership registered under the Investment Partnership Act of 1940, a broker or
dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934,
as amended, a business development partnership, a small business investment
partnership licensed by the U.S. Small Business Administration, a plan with
total assets in excess of $5,000,000 established and maintained by a state for
the benefit of its employees, or a private business development partnership as
defined in Section 202(a)(22) of the Investment Advisers Act of 1940.

o         (iii)      Purchaser is an employee benefit plan and either all
investment decisions are made by a bank, savings and loan association, insurance
partnership, or registered investment advisor, or the undersigned has total
assets in excess of $5,000,000 or, if such plan is a self-directed plan,
investment decisions are made solely by persons who are accredited investors.

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o         (iv)      Purchaser is (A) an organization described in section
501(c)(3) of the Code, or (B) a corporation, partnership, or business trust, in
either case with total assets in excess of $5,000,000.

o         (v)       If Purchaser is not an entity described in paragraphs (i)
through (iv), Purchaser represents that each of its equity owners is either (A)
an entity described in paragraphs (ii) through (iv); or (B) an individual who
(x) has an individual net worth, or a joint net worth with such individual’s
spouse, in excess of $1,000,000, or (y) has had an individual income in excess
of $200,000 in each of the two most recent years, or a joint income with one’s
spouse in excess of $300,000 in each of those years, and has a reasonable
expectation of reaching the same income level in the current year, or (z) is a
director or executive officer of the Company.

o         (vi)      Purchaser is a trust with total assets in excess of
$5,000,000 whose purchase hereunder is directed by a person with such knowledge
and experience in financial and business matters that he is capable of
evaluating the merits and risks of the prospective investment.

o         (vii)      Purchaser cannot make any of the representations set forth
in paragraphs (i) through (vi) above.

4.7              Rule 506 Disqualification Events. 

(a)               The Purchaser has not been convicted, within ten (10) years of
the date hereof, of any felony or misdemeanor (a) in connection with the
purchase or sale of any security; (b) involving the making of any false filing
with the Commission; or (c) arising out of the conduct of the business of an
underwriter, broker, dealer, municipal securities dealer, investment advisor or
paid solicitor of purchasers of securities. 

(b)              The Purchaser is not subject to any order, judgment or decree
of any court of competent jurisdiction, entered within five (5) years of the
date hereof, that, on the date hereof, restrains or enjoins the Purchaser from
engaging or continuing to engage in any conduct or practice (a) in connection
with the purchase or sale of any security; (b) involving the making of any false
filing with the Commission; or (c) arising out of the conduct of the business of
an underwriter, broker, dealer, municipal securities dealer, investment adviser
or paid solicitor of purchasers of securities.

(c)               The Purchaser is not subject to a final order of a state
securities commission (or an agency of officer of a state performing like
functions); a state authority that supervises or examines banks, savings
associations, or credit unions; a state insurance commission (or an agency or
officer of a state performing like functions); an appropriate federal banking
agency; the Commodity Futures Trading Commission; or the National Credit Union
Administration that (a) on the date hereof, bars the Purchaser from association
with an entity regulated by such commission, authority, agency or officer;
engaging in the business of securities, insurance or banking; or engaging in
savings association or credit union activities; or (b) constitutes a final
order, entered within ten (10) years of the date hereof, that is based on a
violation of any law or regulation that prohibits fraudulent, manipulative, or
deceptive conduct.

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(d)              The Purchaser is not subject to an order of the Commission
entered pursuant to Section 15(b) or 15B(c) of the Exchange Act or Section
203(e) or 203(f) of the Investment Advisers Act of 1940 that, on the date hereof
(a) suspends or revokes the Purchaser’s registration as a broker, dealer,
municipal securities dealer or investment adviser; (b) places on the Purchaser
limitations on the activities, functions or operations of, or imposes civil
money penalties; or (c) bars the Purchaser from being associated with any entity
or from participating in the offering of any penny stock.

(e)              The Purchaser is not subject to any order of the Commission,
entered within five (5) years of the date hereof, that, on the date hereof,
orders the Purchaser to cease and desist from committing or causing a violation
of or a future violation of (a) any scienter-based anti-fraud provision of the
federal securities laws, including, but not limited to, Section 17(a)(1) of the
Securities Act of 1933, as amended, Section 10(b) of the Exchange Act and Rule
10b-5 thereunder, and Section 206(1) of the Investment Advisers Act of 1940 or
any other rule or regulation thereunder; or (b) Section 5 of the Securities Act
of 1933, as amended.

(f)               The Purchaser has not been you been suspended or expelled from
membership in, or suspended or barred from association with a member of, a
securities self-regulatory organization (e.g., a registered national securities
exchange or a registered national or affiliated securities association) for any
act or omission to act constituting conduct inconsistent with just and equitable
principles of trade.

(g)              The Purchaser has not filed (as a registrant or issuer), and
has not been named as an underwriter in, any registration statement or
Regulation A offering statement filed with the Commission that, within five (5)
years of the date hereof, was the subject of a refusal order, stop order, or
order suspending the Regulation A exemption, and the Purchaser is not, on the
date hereof, the subject of an investigation or proceeding to determine whether
a stop order or suspension order should be issued.

(h)               The Purchaser is not subject to a United States Postal Service
false representation order entered within five (5) years of the date hereof, and
the Purchaser is not, on the date hereof, subject to a temporary restraining
order or preliminary injunction with respect to conduct alleged by the United
States Postal Service to constitute a scheme or device for obtaining money or
property through the mail by means of false representations.

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ARTICLE V

ADDITIONAL AGREEMENTS

 

5.1            Use of Proceeds.  After Closing, the Company and the Purchaser
shall discuss in good faith and mutually agree in writing upon the Company’s use
of the proceeds from the sale of the Securities to the Purchaser. Prior to such
agreement, the Company may not use any part of the proceeds without the
Purchaser’s prior written consent.

5.2             Board Representation.  At and after the Closing, the Purchaser
shall be entitled to appoint two directors to the Board of Directors of the
Company (the “Board”) who shall be reasonably acceptable to the Company (such
directors, each a “Purchaser Director”). Yang Liu and Nicholas Fazio are agreed
to be acceptable. Each of the foregoing directors shall be appointed as
directors of the same class of directors at the Closing and shall serve for an
initial term of three years such that their terms as directors will expire at
the Company’s 2021 annual meeting of stockholders (and any subsequent required
annual meeting of stockholders). For as long as the Purchaser and its
affiliates, taken together, beneficially own at least 10% of the Company’s
issued and outstanding shares of common stock, the Board shall be comprised of
no more than eight (8) directors (including all independent directors and the
Purchaser Directors), to serve until the next annual meeting of the Company’s
shareholders, unless otherwise consented by the Purchaser. For as long as the
Purchaser and its affiliates, taken together, beneficially own at least 10% of
the Company’s issued and outstanding shares of common stock, the Board shall
include in its 2021 annual meeting (and any subsequent required annual meeting
of stockholders) proxy statement and recommend to the Company’s stockholders to
approve at such annual meeting the appointment of two (2) Purchaser Directors
then designated by the Purchaser, and the Board shall otherwise support such
Purchaser Directors in a manner no less rigorous and favorable than the manner
in which the Company supports its other nominees. The Company and the Board
shall take all necessary actions to ensure that, at all times when a Purchaser
Director is eligible to be appointed or nominated, there are sufficient
vacancies on the Board to permit such designation. In the event the Company’s
stockholders do not approve one or more Purchaser Directors nominated by
Purchaser, the Board shall (i) appoint, to the extent there are available
vacancies, or (ii) to the extent there are no available vacancies call a special
meeting and include in its proxy and recommend to the Company’s stockholders to
approve the appointment of, in each case of (i) or (ii) above, alternative
individuals to serve as the Purchaser Directors as designated by Purchaser to
serve until the following annual meeting of the stockholders. For the avoidance
of doubt, and the Purchaser shall not be required to comply with the advance
notice provisions generally applicable to the nomination of Directors by the
Company so long as the Purchaser provides reasonable advance notice to the
Company of the Purchaser Directors prior to the mailing of the proxy statement
by the Company (provided, that the Company shall provide reasonable advance
notice to the Purchaser of the expected mailing date).

5.3             Registration Rights.

(a)                Definitions.  For purposes of this Section 5.3:

(i)         The terms “register,” “registered,” and “registration” refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of
effectiveness of such registration statement.

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(ii)        Registrable Securities.  The term “Registrable Securities” means:
(A) the Common Stock and the shares underlying the Warrants under this Agreement
and (B) any Common Stock issued as a dividend or other distribution with respect
to, in exchange for or in replacement of the Securities.

(b)              Piggyback Registrations.  The Company shall notify Purchaser in
writing at least thirty (30) days prior to filing any registration statement
under the Securities Act for purposes of effecting a public offering of
securities of the Company (including, but not limited to, registration
statements relating to secondary offerings of securities of the Company, but
excluding registration statements for the purpose of conducting a rights
offering to the Company’s stockholders on Form S-1 or otherwise, on Form S-8 or
on Form S-4, or any successor forms) and will afford Purchaser an opportunity to
include in such registration statement all or any part of the Registrable
Securities then held by Purchaser. Purchaser desiring to include in any such
registration statement all or any part of the Registrable Securities held by
Purchaser shall, within twenty (20) days after receipt of the above-described
notice from the Company, so notify the Company in writing, and in such notice
shall inform the Company of the number of Registrable Securities Purchaser
wishes to include in such registration statement. If Purchaser decides not to
include all of its Registrable Securities in any registration statement
thereafter filed by the Company, Purchaser shall nevertheless continue to have
the right to include any Registrable Securities in any subsequent registration
statement or registration statements as may be filed by the Company with respect
to offerings of its securities, all upon the terms and conditions set forth
herein.

(c)              Demand Registration. In the event that the Registrable
Securities have not been registered within one year after the Closing Date, the
Purchaser may at any time after the first anniversary of the Closing Date
request in writing that the Company file a registration statement under the
Securities Act covering the registration of all of the Registrable Securities
and the Company will use its commercially best efforts to effect such
registration and to permit or facilitate the sale and distribution of all or
such portion of such Registrable Securities as are specified in such request at
its own cost.

(d)              Underwriting.  If a registration statement under which the
Company gives notice under this Section is for an underwritten offering, then
the Company shall so advise the Purchaser. In such event, the right of Purchaser
to include Registrable Securities in a registration pursuant to this Section 5.3
shall be conditioned upon Purchaser’s participation in such underwriting and the
inclusion of Purchaser’s Registrable Securities in the underwriting to the
extent provided herein. If Purchaser proposes to distribute its Registrable
Securities through such underwriting, Purchaser shall enter into an underwriting
agreement in customary form with the managing underwriter or underwriter(s)
selected for such underwriting by the Company. Notwithstanding any other
provision of this Agreement, if the managing underwriter(s) determine(s) in good
faith that marketing factors require a limitation of the number of shares to be
underwritten, then the managing underwriter(s) may exclude shares (including
Registrable Securities) from the registration and the underwriting, and the
number of shares that may be included in the registration and the underwriting
shall be allocated, first, to the Company, and second, to Purchaser.  If
Purchaser disapproves of the terms of any such underwriting, Purchaser may elect
to withdraw therefrom by written notice to the Company and the underwriter,
delivered at least ten (10) business days prior to the effective date of the
registration statement. Any Registrable Securities excluded or withdrawn from
such underwriting shall be excluded and withdrawn from the registration.

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(e)             Expenses.  All registration expenses incurred in connection with
a registration pursuant to this Section shall be borne by the Company. Purchaser
participating in a registration pursuant to this Section shall bear its
proportionate share (based on the total number of shares sold in such
registration other than for the account of the Company) of all discounts,
commissions and selling expenses incurred in connection with a registration
pursuant to this Section.

(f)                Indemnification. In the event any Registrable Securities are
included in a registration statement:

(i)               By the Company.  To the extent permitted by law, the Company
will indemnify and hold harmless Purchaser and each of its Representatives,
against any losses to which it may become subject under the Securities Act, the
Exchange Act or other federal or state law, insofar as such losses arise out of
or are based upon any of the following statements, omissions or violations (each
a “Violation”): (1) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any amendments
or supplements thereto; (2) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading; or (3) any violation or alleged violation by the Company
of the Securities Act, the Exchange Act, any federal or state securities law or
any rule or regulation promulgated under the Securities Act, the Exchange Act or
any federal or state securities law in connection with the offering covered by
such registration statement; and the Company will reimburse Purchaser and its
representatives for any legal or other expenses reasonably incurred by them, as
incurred, in connection with investigating or defending any such loss; provided,
however, that the indemnity agreement contained in this subsection shall not
apply to amounts paid in settlement of any such loss if such settlement is
effected without the consent of the Company (which consent shall not be
unreasonably withheld), nor shall the Company be liable in any such case for any
such loss to the extent that it arises out of or is based upon a violation which
occurs in reliance upon and in conformity with written information furnished
expressly for use in connection with such registration by Purchaser or its
representatives.

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(ii)              By Purchaser.  To the extent permitted by law, Purchaser will
indemnify and hold harmless the Company and each of its representatives and any
underwriter, against any losses to which the Company or any such representative
or underwriter may become subject under the Securities Act, the Exchange Act or
other federal or state law, insofar as such losses arise out of or are based
upon any violation, in each case to the extent (and only to the extent) that
such violation occurs in reliance upon and in conformity with written
information furnished by Purchaser expressly for use in connection with such
registration; and Purchaser will reimburse any legal or other expenses
reasonably incurred by the Company or any such representative or underwriter in
connection with investigating or defending any such loss; provided, however,
that the indemnity agreement contained in this Section shall not apply to
amounts paid in settlement of any such loss if such settlement is effected
without the consent of Purchaser, which consent shall not be unreasonably
withheld.

(iii)              Notice.  Promptly after receipt by an indemnified party under
this Section of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section, deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential conflict of interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party to the extent of such prejudice under this Section, but the
omission so to deliver written notice to the indemnifying party will not relieve
it of any liability that it may have to any indemnified party otherwise than
under this Section.

(iv)            Survival.  The obligations of the Company and Purchaser under
this Section shall survive the completion of any offering of Registrable
Securities in a registration statement.

5.4             Cooperation Regarding Rule 144.  As long as Purchaser owns any
Purchased Shares, the Company will use commercially reasonable efforts to timely
file (or obtain extensions in respect thereof and file within the applicable
grace period) all reports required to be filed by the Company after the date
hereof pursuant to the Exchange Act. As long as Purchaser owns any Securities,
if the Company is not required to file reports pursuant to the Exchange Act, at
the request of the Purchaser Directors, it will prepare and furnish to Purchaser
and make publicly available in accordance with Rule 144(c) such information as
is required for Purchaser to sell Securities under Rule 144. The Company further
covenants that it will take such further action in accordance with U.S.
securities laws as Purchaser may reasonably request (including to cause its
counsel to issue appropriate legal opinions and to direct its transfer agent
accordingly) to the extent required from time to time to enable the Purchaser to
sell Securities without registration under the Securities Act in accordance with
Rule 144.

5.5             Preferred Supplier.  The Purchaser, Unilumin North America,
Inc., and/or its  affiliates shall be a top preferred supplier of all the
Company’s and its subsidiaries’ LED display projects or other products
manufactured or sold by the Purchaser or its affiliates; provided that the
Company reserves the right to purchase similar or identical products from other
suppliers with the consent of Purchaser (such consent not to be unreasonably
withheld), based on, among other things, pricing, product availability,
logistics, and specific customer requirements. The Purchaser, on behalf of
itself and its affiliates, confirm that the Company and its subsidiaries will be
provided the full benefit of any and all  most favorable terms and/or conditions
(“MFN Terms”) contained in any other agreement entered into by the Purchaser
with third parties for similar or identical products required or utilized in
connection with the Company’s business and available in the same territory where
the Company or its relevant subsidiary is located. The Purchaser shall notify
the Company in writing of such MFN Terms within fifteen (15) Business Days after
agreeing thereto in a binding legal agreement, and any terms in the relevant
supplement agreement between the Purchaser or any of its affiliates and the
Company which are less favorable than the MFN Terms shall be deemed to be
reformed to be consistent with the MFN Terms as of the effective date of such
third party agreement and thereafter for such time that the MFN Terms remain in
effect.

5.6             Further Actions.  The proceeds to the Company from the sale of
the Securities and the exercise of the Warrant are necessary to ensure that the
Company can continue as a going concern. The Company acknowledges that the
Purchaser will not be obliged to exercise the Warrant unless the Series B
Convertible Preferred Stock is converted into Common Stock and other conditions
set forth in the Warrant have been satisfied or triggered. The Purchaser
acknowledges that given the Company’s need for the proceeds from the exercise of
the Warrant to continue as a going concern the Company may take certain actions
relating to the conversion of the Series B Convertible Preferred Stock including
seeking Shareholder approval to approve amendments to the Company’s Amended and
Restated Certificate of Incorporation, as amended, to decrease the conversion
price of the Series B Convertible Preferred Stock and increase the Company’s
authorized capital.

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ARTICLE VI

INDEMNIFICATION

 

            Section 6.  Indemnification.

 

6.1              Survival.  Subject to the limitations and other provisions of
this Agreement, the representations and warranties set forth in Sections 3.1,
3.2, 4.1 and 4.2 shall survive the Closing indefinitely and all other
representations, warranties, covenants and agreements of each party in this
Agreement shall survive the Closing for the period explicitly specified therein
and, if not specified, for a period of two years. Notwithstanding the foregoing,
any claims asserted in good faith with reasonable specificity (to the extent
known at such time) and in writing by notice from the non-breaching party to the
breaching party prior to the expiration date of the applicable survival period
shall not thereafter be barred by the expiration of the relevant covenant or
agreement and such claims shall survive until finally resolved. 

6.2             Indemnification.  Subject to the other terms and conditions of
this Agreement and notwithstanding Section 6.3, the Company and Purchaser shall
indemnify and defend the other party and their respective Subsidiaries and
Representatives (collectively, the “Indemnitees”) against, and shall hold each
of them harmless from and against, and shall pay and reimburse each of them for,
any and all losses incurred or sustained by, or imposed upon, the Indemnitees
based upon, arising out of, with respect to or by reason of:

a.                any inaccuracy in or breach of any of the representations or
warranties of the such party contained in this Agreement or in any certificate
or instrument delivered by or on behalf of the such party pursuant to this
Agreement; or

b.               any breach or non-fulfillment of any covenant, agreement or
obligation required to be performed by the such party pursuant to this
Agreement.

6.3             Certain Limitations.  Notwithstanding anything contained in
Section 6.2 or otherwise in this Agreement, the aggregate amount for all losses
for which either party hereto shall be liable pursuant to Section 6.2 shall not
exceed one hundred percent (100%) of the Subscription Amount.

6.4             Tax Treatment of Indemnification Payments.  All indemnification
payments made under this Agreement shall be treated by the parties as an
adjustment to the Subscription Amount for tax purposes, unless otherwise
required by law.

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ARTICLE VII

MISCELLANEOUS

 

            Section 7.  Miscellaneous.

7.1       Successor and Assigns.  This Agreement will bind and inure to the
parties and their respective successors and permitted assigns. No party hereto
may assign this Agreement or any rights or obligations hereunder without the
prior written consent of the other party hereto (other than by merger).

7.2       Governing Law.  This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of New York,
without giving effect to principles of conflicts of law.

7.3       Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

7.4       Titles and Subtitles.  The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement.

 

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7.5             Notices.  All notices, requests and other communications to any
party hereunder will be in writing and shall be deemed effectively given (a)
upon personal delivery to the party to be notified, (b) upon confirmed delivery
by Federal Express or other nationally recognized courier service providing
next-business-day delivery, or (c) three business days after deposit with the
United States Postal Service, by registered or certified mail, postage prepaid
and addressed to the party to be notified, in each case at the address set forth
below, or at such other address as such party may designate by written notice to
the other party (provided that notice of change of address shall be effective
upon receipt by the party to whom such notice is addressed.      

 

If to the Company

Trans-Lux Corporation

135 East 57th Street, 14th Floor

New York, NY 10022

Attention:  Alberto Shaio, President and Chief Executive Officer

 

 

With a copy to:

 

Olshan Frome Wolosky LLP

1325 Avenue of the Americas

New York, NY 10019

Attention: Kenneth Schlesinger, Esq.

Fax: (212) 451-2222

Email: kschlesinger@olshanlaw.com

 

 

 

If to Unilumin:

Unilumin North America, Inc.

c/o Unilumin LED Technology FL LLC

254 West 51st Street

New York, NY 10001

Attention:  Nicholas Fazio, Chief Executive Officer

 

 

With a copy to:

 

Durkin Law, LLC

101 Hudson Street, Suite 2100

Jersey City, NJ 07305

Attention:  Thomas E. Durkin, III, Esq.

Email:  TDurkin3@durkinlawllc.com

 

7.6       Amendments and Waivers.  Any term of this Agreement may be amended or
waived only with the written consent of the Company and the Purchaser. Any
amendment or waiver effected in accordance with this Section 7.6 shall be
binding upon the Purchaser and each transferee of the Securities, each future
holder of all such Securities, and the Company.

7.7       Severability.  If one or more provisions of this Agreement are held to
be unenforceable under applicable law, the parties agree to renegotiate such
provision in good faith, in order to maintain the economic position enjoyed by
each party as close as possible to that under the provision rendered
unenforceable. In the event that the parties cannot reach a mutually agreeable
and enforceable replacement for such provision, then (i) such provision shall be
excluded from this Agreement, (ii) the balance of the Agreement shall be
interpreted as if such provision were so excluded and (iii) the balance of the
Agreement shall be enforceable in accordance with its terms.

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7.8       Finders’ Fees.  Each of the Company and the Purchaser will indemnify
the other against all liabilities incurred by the indemnifying party with
respect to claims related to investment banking or finders’ fees in connection
with the transactions contemplated by this Agreement, arising out of
arrangements between the party asserting such claims and the indemnifying party,
and all costs and expenses (including reasonable fees of counsel) of
investigating and defending such claims.

7.9       Expenses.  Each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses incurred
by such party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement. Notwithstanding the forgoing, to the extent the
Warrant is exercised in full, the Company will reimburse the Purchaser for up to
$175,000 of the Purchaser’s expenses. The Company shall pay all transfer agent
fees, stamp taxes and other taxes and duties levied in connection with the
delivery of any Securities to the Purchaser.

7.10     Entire Agreement.  This Agreement and the other Transaction Documents
(and the Exhibits hereto and thereto) constitute the entire agreement between
the parties hereto pertaining to the subject matter hereof, and any and all
other written or oral agreements existing between the parties hereto are
expressly cancelled.

7.11     Exculpation Among Purchasers.  The Purchaser acknowledges that it is
not relying upon any person, firm or corporation, other than the Company and its
officers and directors, in making its investment or decision to invest in the
Company.  The Purchaser agrees that neither the Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
other purchaser of Securities in connection with the Offering shall be liable
for any action heretofore or hereafter taken or omitted to be taken by any of
them in connection with the Securities.

7.12     Further Assurances.  The Company and Purchaser shall each execute and
deliver all further documents or instruments and take all further actions
reasonably requested by the other in order to fully effectuate the intent and
purpose of this Agreement and obtain the full benefit of this Agreement. The
Company will use its commercially reasonable efforts to have a rights offering
in the amount of $2,500,000 consummated prior to June 1,2019.

Signature Page Follows

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

 

COMPANY

PURCHASER

TRANS-LUX CORPORATION

UNILUMIN NORTH AMERICA, INC.

 

 

 

 

By:

/s/ Alberto Shaio

By:

/s/ Nicholas J Fazio

Name:

Alberto Shaio

Name:

Nicholas J Fazio

Title:

President and Chief Executive Officer

Title:

Chief Executive Officer

Date:

November 2, 2018

Date:

November 2, 2018

 

 

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EXHIBIT A

 

Form of Warrant

*

 

 

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