Exhibit 10.1
PURCHASE AGREEMENT
 
THIS PURCHASE AGREEMENT (this “Agreement”), dated as of March 24, 2020, by and
between VISTAGEN THERAPEUTICS, INC., a Nevada corporation (the “Company”), and
LINCOLN PARK CAPITAL FUND, LLC, an Illinois limited liability company (the
“Investor”).
 
WHEREAS:
 
Subject to the terms and conditions set forth in this Agreement, the Company
wishes to sell to the Investor, and the Investor wishes to buy from the Company,
up to Ten Million Two Hundred Fifty Thousand Dollars ($10,250,000) of the
Company's common stock, $0.001 par value per share (the "Common Stock"). The
shares of Common Stock to be purchased hereunder are referred to herein as the
“Purchase Shares.”
 
NOW THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Company and the Investor hereby
agree as follows:
 
1.           CERTAIN DEFINITIONS.
 
For purposes of this Agreement, the following terms shall have the following
meanings:
 
(a)           “Accelerated Purchase Date” means, with respect to any Accelerated
Purchase made pursuant to Section 2(c) hereof, the Business Day immediately
following the applicable Purchase Date with respect to the corresponding Regular
Purchase referred to in clause (i) of the second sentence of Section 2(c)
hereof.
 
(b)           “Accelerated Purchase Minimum Price Threshold” means, with respect
to any Accelerated Purchase made pursuant to Section 2(c) hereof, any minimum
per share price threshold set forth in the applicable Accelerated Purchase
Notice.
 
(c)           “Accelerated Purchase Notice” means, with respect to any
Accelerated Purchase made pursuant to Section 2(c) hereof, an irrevocable
written notice from the Company to the Investor directing the Investor to buy a
specified Accelerated Purchase Share Amount on the applicable Accelerated
Purchase Date pursuant to Section ‎2‎(c) hereof at the applicable Accelerated
Purchase Price on the Accelerated Purchase Date for such Accelerated Purchase in
accordance with this Agreement , and specifying any Accelerated Purchase Minimum
Price Threshold determined by the Company.
 
(d)           “Accelerated Purchase Price” means, with respect to any particular
Accelerated Purchase made pursuant to Section 2(c) hereof, the lower of (i)
ninety-five percent (95%) of the VWAP for the period beginning at 9:30:01 a.m.,
Eastern time, on the applicable Accelerated Purchase Date, or such other time
publicly announced by the Principal Market as the official open (or
commencement) of trading on the Principal Market on such applicable Accelerated
Purchase Date (the “Accelerated Purchase Commencement Time”), and ending at the
earliest of (A) 4:00:00 p.m., Eastern time, on such applicable Accelerated
Purchase Date, or such other time publicly announced by the Principal Market as
the official close of trading on the Principal Market on such applicable
Accelerated Purchase Date, (B) such time, from and after the Accelerated
Purchase Commencement Time for such Accelerated Purchase, that the total number
(or volume) of shares of Common Stock traded on the Principal Market has
exceeded the applicable Accelerated Purchase Share Volume Maximum, and (C) such
time, from and after the Accelerated Purchase Commencement Time for such
Accelerated Purchase, that the Sale Price has fallen below the applicable
Accelerated Purchase Minimum Price Threshold (such earliest of (i)(A), (i)(B)
and (i)(C) above, the “Accelerated Purchase Termination Time”), and (ii) the
Closing Sale Price of the Common Stock on such applicable Accelerated Purchase
Date (each to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split, reverse stock split or other
similar transaction).
 

 
 

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(e)         “Accelerated Purchase Share Amount” means, with respect to an
Accelerated Purchase made pursuant to Section 2(c) hereof, the number of
Purchase Shares directed by the Company to be purchased by the Investor in an
Accelerated Purchase Notice, which number of Purchase Shares shall not exceed
the lesser of (i) 300% of the number of Purchase Shares directed by the Company
to be purchased by the Investor pursuant to the corresponding Regular Purchase
Notice for the corresponding Regular Purchase referred to in clause (i) of the
second sentence of Section 2(c) hereof (subject to the Purchase Share
limitations contained in Section 2(b) hereof) and (ii) an amount equal to (A)
the Accelerated Purchase Share Percentage multiplied by (B) the total number (or
volume) of shares of Common Stock traded on the Principal Market during the
period on the applicable Accelerated Purchase Date beginning at the Accelerated
Purchase Commencement Time for such Accelerated Purchase and ending at the
Accelerated Purchase Termination Time for such Accelerated Purchase.
 
(f)           “Accelerated Purchase Share Percentage” means, with respect to any
Accelerated Purchase made pursuant to Section 2(c) hereof, thirty percent (30%).
 
(g)           “Accelerated Purchase Share Volume Maximum” means, with respect to
an Accelerated Purchase made pursuant to Section 2(c) hereof, a number of shares
of Common Stock equal to (i) the applicable Accelerated Purchase Share Amount to
be purchased by the Investor pursuant to the applicable Accelerated Purchase
Notice for such Accelerated Purchase, divided by (ii) the Accelerated Purchase
Share Percentage (to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split, reverse stock split or other
similar transaction).
 
(h)           “Additional Accelerated Purchase Date” means, with respect to an
Additional Accelerated Purchase made pursuant to Section 2(d) hereof, the
Business Day (i) that is the Accelerated Purchase Date with respect to the
corresponding Accelerated Purchase referred to in Section 2(d) hereof and (ii)
on which the Investor receives, prior to 1:00 p.m., Eastern time, on such
Business Day, a valid Additional Accelerated Purchase Notice for such Additional
Accelerated Purchase in accordance with this Agreement.
 
(i)           “Additional Accelerated Purchase Minimum Price Threshold” means,
with respect to an Additional Accelerated Purchase made pursuant to Section 2(d)
hereof, any minimum per share price threshold set forth in the applicable
Additional Accelerated Purchase Notice.
 
(j)           “Additional Accelerated Purchase Notice” means, with respect to an
Additional Accelerated Purchase made pursuant to Section 2(d) hereof, an
irrevocable written notice from the Company to the Investor directing the
Investor to purchase the applicable Additional Accelerated Purchase Share Amount
at the Additional Accelerated Purchase Price for such Additional Accelerated
Purchase in accordance with this Agreement, and specifying any Additional
Accelerated Purchase Minimum Price Threshold determined by the Company.
 
(k)           “Additional Accelerated Purchase Price” means, with respect to an
Additional Accelerated Purchase made pursuant to Section 2(d) hereof, the lower
of (i) ninety-five percent (95%) of the VWAP for the period on the applicable
Additional Accelerated Purchase Date, beginning at the latest of (A) the
applicable Accelerated Purchase Termination Time with respect to the
corresponding Accelerated Purchase referred to in Section 2(d) hereof on such
Additional Accelerated Purchase Date, (B) the applicable Additional Accelerated
Purchase Termination Time with respect to the most recently completed prior
Additional Accelerated Purchase on such Additional Accelerated Purchase Date, as
applicable, and (C) the time at which all Purchase Shares subject to all prior
Accelerated Purchases and Additional Accelerated Purchases (as applicable),
including, without limitation, those that have been effected on the same
Business Day as the applicable Additional Accelerated Purchase Date with respect
to which the applicable Additional Accelerated Purchase relates, have
theretofore been received by the Investor as DWAC Shares in accordance with this
Agreement (such latest of (i)(A), (i)(B) and (i)(C) above, the “Additional
Accelerated Purchase Commencement Time”), and ending at the earliest of (X) 4:00
p.m., Eastern time, on such Additional Accelerated Purchase Date, or such other
time publicly announced by the Principal Market as the official close of trading
on the Principal Market on such Additional Accelerated Purchase Date, (Y) such
time, from and after the Additional Accelerated Purchase Commencement Time for
such Additional Accelerated Purchase, that the total number (or volume) of
shares of Common Stock traded on the Principal Market has exceeded the
applicable Additional Accelerated Purchase Share Volume Maximum, and (Z) such
time, from and after the Additional Accelerated Purchase Commencement Time for
such Additional Accelerated Purchase, that the Sale Price has fallen below the
applicable Additional Accelerated Purchase Minimum Price Threshold (if any)
(such earliest of (i)(X), (i)(Y) and (i)(Z) above, the “Additional Accelerated
Purchase Termination Time”), and (ii) the Closing Sale Price of the Common Stock
on such Additional Accelerated Purchase Date (each to be appropriately adjusted
for any reorganization, recapitalization, non-cash dividend, stock split,
reverse stock split or other similar transaction).
 
 
 
 
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(l)             “Additional Accelerated Purchase Share Amount” means, with
respect to an Additional Accelerated Purchase made pursuant to Section 2(d)
hereof, the number of Purchase Shares directed by the Company to be purchased by
the Investor on an Additional Accelerated Purchase Notice, which number of
Purchase Shares shall not exceed the lesser of (i) 300% of the number of
Purchase Shares directed by the Company to be purchased by the Investor pursuant
to the corresponding Regular Purchase Notice for the corresponding Regular
Purchase referred to in clause (i) of the second sentence of Section 2(d) hereof
(subject to the Purchase Share limitations contained in Section 2(b) hereof) and
(ii) an amount equal to (A) the Additional Accelerated Purchase Share Percentage
multiplied by (B) the total number (or volume) of shares of Common Stock traded
on the Principal Market during the period on the applicable Additional
Accelerated Purchase Date beginning at the Additional Accelerated Purchase
Commencement Time for such Additional Accelerated Purchase and ending at the
Additional Accelerated Purchase Termination Time for such Additional Accelerated
Purchase.
 
(m)           “Additional Accelerated Purchase Share Percentage” means, with
respect to an Additional Accelerated Purchase made pursuant to Section 2(d)
hereof, thirty percent (30%).
 
(n)           “Additional Accelerated Purchase Share Volume Maximum” means, with
respect to an Additional Accelerated Purchase made pursuant to Section 2(d)
hereof, a number of shares of Common Stock equal to (i) the applicable
Additional Accelerated Purchase Share Amount to be purchased by the Investor
pursuant to the applicable Additional Accelerated Purchase Notice for such
Additional Accelerated Purchase, divided by (ii) the Additional Accelerated
Purchase Share Percentage (to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split, or other similar
transaction)..
 
(o)           “Alternate Adjusted Regular Purchase Share Limit” means, with
respect to a Regular Purchase made pursuant to Section 2(b) hereof, the maximum
number of Purchase Shares which, taking into account the applicable per share
Purchase Price therefor calculated in accordance with this Agreement, would
enable the Company to deliver to the Investor, on the applicable Purchase Date
for such Regular Purchase, a Regular Purchase Notice for a Purchase Amount equal
to, or as closely approximating without exceeding, One Hundred Fifty Thousand
Dollars ($150,000).
 
(p)            “Available Amount” means, initially, Ten Million Two Hundred
Fifty Thousand Dollars ($10,250,000) in the aggregate, which amount shall be
reduced by the Purchase Amount each time the Investor purchases shares of Common
Stock (including the Initial Purchase Shares) pursuant to Section 2 hereof.
 
(q)            “Average Price” means a price per Purchase Share (rounded to the
nearest tenth of a cent) equal to the quotient obtained by dividing (i) the
aggregate gross purchase price paid by the Investor for all Purchase Shares
purchased pursuant to this Agreement, by (ii) the aggregate number of Purchase
Shares issued pursuant to this Agreement.
 
(r)           “Bankruptcy Law” means Title 11, U.S. Code, or any similar federal
or state law for the relief of debtors.
 
(t)           “Business Day” means any day on which the Principal Market is open
for trading, including any day on which the Principal Market is open for trading
for a period of time less than the customary time.
 
(u)           “Closing Sale Price” means, for any security as of any date, the
last closing sale price for such security on the Principal Market as reported by
the Principal Market.
 
(v)           “Confidential Information” means any information disclosed by
either party to the other party, either directly or indirectly, in writing,
orally or by inspection of tangible objects (including, without limitation,
documents, prototypes, samples, plant and equipment), which is designated as
"Confidential," "Proprietary" or some similar designation. Information
communicated orally shall be considered Confidential Information if such
information is confirmed in writing as being Confidential Information within ten
(10) Business Days after the initial disclosure. Confidential Information may
also include information disclosed to a disclosing party by third parties.
Confidential Information shall not, however, include any information which (i)
was publicly known and made generally available in the public domain prior to
the time of disclosure by the disclosing party; (ii) becomes publicly known and
made generally available after disclosure by the disclosing party to the
receiving party through no action or inaction of the receiving party; (iii) is
already in the possession of the receiving party without confidential
restriction at the time of disclosure by the disclosing party as shown by the
receiving party’s files and records immediately prior to the time of disclosure;
(iv) is obtained by the receiving party from a third party without a breach of
such third party’s obligations of confidentiality; (v) is independently
developed by the receiving party without use of or reference to the disclosing
party’s Confidential Information, as shown by documents and other competent
evidence in the receiving party’s possession; or (vi) is required by law to be
disclosed by the receiving party, provided that the receiving party gives the
disclosing party prompt written notice of such requirement prior to such
disclosure and assistance in obtaining an order protecting the information from
public disclosure.
 
 
 
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(w)           “Custodian” means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
 
(x)           “DTC” means The Depository Trust Company, or any successor
performing substantially the same function for the Company.
 
(y)           “DWAC Shares” means shares of Common Stock that are (i) issued in
electronic form, (ii) freely tradable and transferable and without restriction
on resale and (iii) timely credited by the Company to the Investor’s or its
designee’s specified Deposit/Withdrawal at Custodian (DWAC) account with DTC
under its Fast Automated Securities Transfer (FAST) Program, or any similar
program hereafter adopted by DTC performing substantially the same function.
 
(z)           “Exchange Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
 
(aa)           “Fully Adjusted Regular Purchase Share Limit” means, following
any reorganization, recapitalization, non-cash dividend, stock split or other
similar transaction from and after the date of this Agreement, the Regular
Purchase Share Limit (as defined in Section 2(b) hereof) in effect on the
applicable date of determination, after giving effect to the full proportionate
adjustment with respect to such reorganization, recapitalization, non-cash
dividend, stock split or other similar transaction.
 
(bb)           “Initial Purchase Price” means fifty cents ($0.50).
 
(cc)           “Material Adverse Effect” means any material adverse effect on
(i) the enforceability of any Transaction Document, (ii) the results of
operations, assets, business or financial condition of the Company and its
Subsidiaries, taken as a whole, other than any material adverse effect that
resulted exclusively from (A) any change in the United States or foreign
economies or securities or financial markets in general that does not have a
disproportionate effect on the Company and its Subsidiaries, taken as a whole,
(B) any change that generally affects the industry in which the Company and its
Subsidiaries operate that does not have a disproportionate effect on the Company
and its Subsidiaries, taken as a whole, (C) any change arising in connection
with earthquakes, other acts of God, hostilities, acts of war, sabotage or
terrorism or military actions or any escalation or material worsening of any
such hostilities, acts of war, sabotage or terrorism or military actions
existing as of the date hereof, (D) any action taken by the Investor, its
affiliates or its or their successors and assigns with respect to the
transactions contemplated by this Agreement, (E) the effect of any change in
Applicable Laws or accounting rules that does not have a disproportionate effect
on the Company and its Subsidiaries, taken as a whole, or (F) any change
resulting from compliance with terms of this Agreement or the consummation of
the transactions contemplated by this Agreement, or (iii) the Company’s ability
to perform in any material respect on a timely basis its obligations under any
Transaction Document to be performed as of the date of determination.
 

(dd)           “Maturity Date” means the first day of the month immediately
following the twenty-four (24) month anniversary of the Commencement Date.
 
(ee)            “PEA Period” means the period commencing at 9:30 a.m., Eastern
time, on the twentieth (20th) Business Day immediately prior to the filing of
any post-effective amendment to the Registration Statement (as defined herein)
or New Registration Statement (as such term is defined in the Registration
Rights Agreement), and ending at 9:30 a.m., Eastern time, on the Business Day
immediately following, the effective date of any post-effective amendment to the
Registration Statement (as defined herein) or New Registration Statement (as
such term is defined in the Registration Rights Agreement).
 
(ff)           “Person” means an individual or entity including but not limited
to any limited liability company, a partnership, a joint venture, a corporation,
a trust, an unincorporated organization and a government or any department or
agency thereof.
 
 
 
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(gg)           “Principal Market” means The Nasdaq Capital Market (or any
nationally recognized successor thereto); provided, however, that in the event
the Company’s Common Stock is ever listed or traded on The Nasdaq Global Market,
The Nasdaq Global Select Market, the New York Stock Exchange, the NYSE American,
the NYSE Arca, the OTC Bulletin Board, the OTCQX operated by the OTC Markets
Group, Inc. or the or OTCQB operated by the OTC Markets Group, Inc. (or any
nationally recognized successor to any of the foregoing), then the “Principal
Market” shall mean such other market or exchange on which the Company’s Common
Stock is then listed or traded.
 
(hh)           “Purchase Amount” means, with respect to the Initial Purchase,
any Regular Purchase, any Accelerated Purchase and any Additional Accelerated
Purchase made hereunder, as applicable, the portion of the Available Amount to
be purchased by the Investor pursuant to Section 2 hereof.
 
(ii)           “Purchase Date” means, with respect to a Regular Purchase made
pursuant to Section 2(b) hereof, the Business Day on which the Investor
receives, after 4:00 p.m., Eastern time, but prior to 5:00 p.m., Eastern time,
on such Business Day, a valid Regular Purchase Notice for such Regular Purchase
in accordance with this Agreement.
 
(jj)           “Purchase Notice” means a Regular Purchase Notice, an Accelerated
Purchase Notice or an Additional Accelerated Purchase Notice with respect to any
Regular Purchase, Accelerated Purchase or Additional Accelerated Purchase,
respectively.
 
(kk)           “Purchase Price” means, with respect to any Regular Purchase made
pursuant to Section 2(b) hereof, the lower of: (i) the lowest Sale Price on the
applicable Purchase Date and (ii) the arithmetic average of the three (3) lowest
Closing Sale Prices for the Common Stock during the ten (10) consecutive
Business Days ending on the Business Day immediately preceding such Purchase
Date (in each case, to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction
that occurs on or after the date of this Agreement).
 
(ll)            “Registration Rights Agreement” means that certain Registration
Rights Agreement, of even date herewith between the Company and the Investor.
 
(mm)            “Regular Purchase Notice” means, with respect to any Regular
Purchase pursuant to Section 2(b) hereof, an irrevocable written notice from the
Company to the Investor directing the Investor to buy such applicable amount of
Purchase Shares at the applicable Purchase Price as specified by the Company
therein on the applicable Purchase Date for such Regular Purchase.
 
(nn)            “Sale Price” means any trade price for the shares of Common
Stock on the Principal Market as reported by the Principal Market.
 
(oo)           “SEC” means the U.S. Securities and Exchange Commission.
 
(pp)           “Securities” means, collectively, the Purchase Shares (including
the Initial Purchase Shares) and the Commitment Shares.
 
(qq)           “Securities Act” means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
 
(rr)           “Subsidiary” means any Person the Company wholly-owns or
controls, or in which the Company, directly or indirectly, owns a majority of
the voting stock or similar voting interest, in each case that would be
disclosable pursuant to Item 601(b)(21) of Regulation S-K promulgated under the
Securities Act.
 
(ss)           “Transaction Documents” means, collectively, this Agreement and
the schedules and exhibits hereto, the Registration Rights Agreement and the
schedules and exhibits thereto, and each of the other agreements, documents,
certificates and instruments entered into or furnished by the parties hereto or
thereto in connection with the transactions contemplated hereby and thereby.
 
(tt) “Transfer Agent” means Computershare, Inc., or such other Person who is
then serving as the transfer agent for the Company with respect to the Common
Stock.
 
 
 
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(uu)           “VWAP” means with respect to an Accelerated Purchase Date or an
Additional Accelerated Purchase Date, as applicable, the volume weighted average
price of the Common Stock on the Principal Market, as reported on the Principal
Market or by another reputable source such as Bloomberg, L.P.
 
2. PURCHASE OF COMMON STOCK.
 
Subject to the terms and conditions set forth in this Agreement, the Company has
the right to sell to the Investor, and the Investor has the obligation to
purchase from the Company, Purchase Shares as follows:
 

(a)            Initial Purchase. On the date hereof, the Company shall purchase
Two Hundred Fifty Thousand Dollars ($250,000) in Purchase Shares at the Initial
Purchase Price (such purchase the “Initial Purchase” and such Purchase Shares,
the “Initial Purchase Shares”).
 

(b)            Commencement of Regular Sales of Common Stock. Upon the
satisfaction of the conditions set forth in Sections 7 and 8 hereof (the
“Commencement” and the date of satisfaction of such conditions the “Commencement
Date”), the Company shall have the right, but not the obligation, to direct the
Investor, by its delivery to the Investor of a Regular Purchase Notice from time
to time, to purchase up to One Hundred Thousand (100,000) Purchase Shares,
subject to adjustment as set forth below in this Section 2(b) (such maximum
number of Purchase Shares, as may be adjusted from time to time, the “Regular
Purchase Share Limit”), at the Purchase Price on the Purchase Date (each such
purchase a “Regular Purchase”); provided, however, that (i) the Regular Purchase
Share Limit shall be increased to One Hundred Fifty Thousand (150,000) Purchase
Shares, if the Closing Sale Price of the Common Stock on the applicable Purchase
Date is not below $0.80, (ii) the Regular Purchase Share Limit shall be
increased to Two Hundred Thousand (200,000) Purchase Shares, if the Closing Sale
Price of the Common Stock on the applicable Purchase Date is not below $1.00,
and (iii) the Regular Purchase Share Limit shall be increased to Two Hundred
Fifty Thousand (250,000) Purchase Shares, if the Closing Sale Price of the
Common Stock on the applicable Purchase Date is not below $1.50; provided,
further, however, that if, the Fully Adjusted Regular Purchase Share Limit then
in effect would preclude the Company from delivering to the Investor a Regular
Purchase Notice hereunder for a Purchase Amount equal to or greater the
Alternate Adjusted Regular Purchase Share Limit, the Alternate Adjusted Regular
Purchase Share Limit shall apply in lieu of the Fully Adjusted Regular Purchase
Share Limit; and provided, further, however, that the Investor’s committed
obligation under any single Regular Purchase, other than any Regular Purchase
with respect to which an Alternate Adjusted Regular Purchase Share Limit shall
apply, shall not exceed One Million Dollars ($1,000,000). The Company may
deliver multiple Regular Purchase Notices to the Investor in a day as often as
every Business Day, so long as Purchase Shares for all prior Regular Purchases,
Accelerated Purchases and Additional Accelerated Purchases, including, without
limitation, those that have been effected on the same Business Day as the
applicable Purchase Date, have theretofore been received by the Investor as DWAC
Shares in accordance with this Agreement. Notwithstanding the foregoing, the
Company shall not deliver a Regular Purchase Notice to the Investor during the
PEA Period.
 

(c)            Accelerated Purchases. Subject to the terms and conditions of
this Agreement, beginning on the Commencement Date, in addition to purchases of
Purchase Shares as described in Section 2(b) above, the Company shall also have
the right, but not the obligation, to direct the Investor, by its delivery to
the Investor of an Accelerated Purchase Notice from time to time in accordance
with this Agreement, to purchase the applicable Accelerated Purchase Share
Amount at the Accelerated Purchase Price on the Accelerated Purchase Date
therefor in accordance with this Agreement (each such purchase, an “Accelerated
Purchase”). The Company may deliver an Accelerated Purchase Notice to the
Investor only on a Purchase Date on which (i) the Company also properly
submitted a Regular Purchase Notice providing for a Regular Purchase of a number
of Purchase Shares not less than the Regular Purchase Share Limit then in effect
on such Purchase Date in accordance with this Agreement = (ii) if all Purchase
Shares subject to all prior Regular Purchases, Accelerated Purchases and
Additional Accelerated Purchases, including, without limitation, those that have
been effected on the same Business Day as the applicable Accelerated Purchase
Date with respect to which the applicable Accelerated Purchase relates, have
theretofore been received by the Investor as DWAC Shares in accordance with this
Agreement and (iii) the Closing Sale Price of the Common Stock is not less than
the Accelerated Purchase Floor Price. Within one (1) Business Day after
completion of each Accelerated Purchase Date for an Accelerated Purchase, the
Investor will provide to the Company a written confirmation of such Accelerated
Purchase setting forth the applicable Accelerated Purchase Share Amount and
Accelerated Purchase Price for such Accelerated Purchase (each, an “Accelerated
Purchase Confirmation”). Notwithstanding the foregoing, the Company shall not
deliver any Accelerated Purchase Notices during the PEA Period.
 

 
 
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(d)             Additional Accelerated Purchases. Subject to the terms and
conditions of this Agreement, beginning one (1) Business Day following the
Commencement Date and thereafter, in addition to purchases of Purchase Shares as
described in Section 2(b) and Section 2(c) above, the Company shall also have
the right, but not the obligation, to direct the Investor, by its timely
delivery to the Investor of an Additional Accelerated Purchase Notice on an
Additional Accelerated Purchase Date in accordance with this Agreement, to
purchase the applicable Additional Accelerated Purchase Share Amount at the
applicable Additional Accelerated Purchase Price therefor in accordance with
this Agreement (each such purchase, an “Additional Accelerated Purchase”). The
Company may deliver multiple Additional Accelerated Purchase Notices to the
Investor on an Additional Accelerated Purchase Date; provided, however, that the
Company may deliver an Additional Accelerated Purchase Notice to the Investor
only (i) on a Business Day that is also the Accelerated Purchase Date for an
Accelerated Purchase with respect to which the Company properly submitted to the
Investor an Accelerated Purchase Notice in accordance with this Agreement on the
applicable Purchase Date for a Regular Purchase of a number of Purchase Shares
not less than the Regular Purchase Share Limit then in effect in accordance with
this Agreement, and (ii) if all Purchase Shares subject to all prior Regular
Purchases, Accelerated Purchases and Additional Accelerated Purchases,
including, without limitation, those that have been effected on the same
Business Day as the applicable Additional Accelerated Purchase Date with respect
to which the applicable Additional Accelerated Purchase relates, have
theretofore been received by the Investor as DWAC Shares in accordance with this
Agreement. Within one (1) Business Day after the completion of each Additional
Accelerated Purchase Date, the Investor will provide to the Company a written
confirmation of each Additional Accelerated Purchase on such Additional
Accelerated Purchase Date setting forth the applicable Additional Accelerated
Purchase Share Amount and Additional Accelerated Purchase Price for each such
Additional Accelerated Purchase on such Additional Accelerated Purchase Date
(each, an “Additional Accelerated Purchase Confirmation”). Notwithstanding the
foregoing, the Company shall not deliver any Additional Accelerated Purchase
Notices during the PEA Period.
 

(e)            Payment for Purchase Shares. The Investor shall pay to the
Company the price for the Initial Purchase Shares pursuant to Section 2(a) via
wire transfer of immediately available funds on the same Business Day that the
Investor receives the Initial Purchase Shares, if such Initial Purchase Shares
are so received by the Investor before 1:00 p.m., Eastern time, or, if such
Initial Purchase Shares are so received by the Investor after 1:00 p.m., Eastern
time, the next Business Day. For each Regular Purchase, the Investor shall pay
to the Company an amount equal to the Purchase Amount with respect to such
Regular Purchase as full payment for such Purchase Shares via wire transfer of
immediately available funds on the same Business Day that the Investor receives
such Purchase Shares, if such Purchase Shares are received by the Investor
before 1:00 p.m., Eastern time, or, if such Purchase Shares are received by the
Investor after 1:00 p.m., Eastern time, the next Business Day. For each
Accelerated Purchase and each Additional Accelerated Purchase, the Investor
shall pay to the Company an amount equal to the Purchase Amount with respect to
such Accelerated Purchase and Additional Accelerated Purchase, respectively, as
full payment for such Purchase Shares via wire transfer of immediately available
funds on the second Business Day following the date that the Investor receives
such Purchase Shares. If the Company or the Transfer Agent shall fail for any
reason or for no reason to electronically transfer any Purchase Shares as DWAC
Shares submitted by the Investor or its agent with respect to any Regular
Purchase, Accelerated Purchase or Additional Accelerated Purchase (as
applicable) within two (2) Business Days following the receipt by the Company of
the Purchase Price, Accelerated Purchase Price or Additional Accelerated
Purchase Price, respectively, therefor in compliance with this Section 2(e), and
if on or after such Business Day the Investor purchases (in an open market
transaction or otherwise) shares of Common Stock to deliver in satisfaction of a
sale by the Investor of such Purchase Shares that the Investor anticipated
receiving from the Company with respect to such Regular Purchase, Accelerated
Purchase or Additional Accelerated Purchase (as applicable), then the Company
shall, within two (2) Business Days after the Investor’s request, either (i) pay
cash to the Investor in an amount equal to the Investor’s total purchase price
(including customary brokerage commissions, if any) for the shares of Common
Stock so purchased (the “Cover Price”), at which point the Company’s obligation
to deliver such Purchase Shares as DWAC Shares shall terminate, or (ii) promptly
honor its obligation to deliver to the Investor such Purchase Shares as DWAC
Shares and pay cash to the Investor in an amount equal to the excess (if any) of
the Cover Price over the total Purchase Amount paid by the Investor pursuant to
this Agreement for all of the Purchase Shares to be purchased by the Investor in
connection with such purchases. The Company shall not issue any fraction of a
share of Common Stock upon the Initial Purchase or any Regular Purchase,
Accelerated Purchase or Additional Accelerated Purchase. If the issuance would
result in the issuance of a fraction of a share of Common Stock, the Company
shall round such fraction of a share of Common Stock up or down to the nearest
whole share. All payments made under this Agreement shall be made in lawful
money of the United States of America or wire transfer of immediately available
funds to such account as the Company may from time to time designate by written
notice in accordance with the provisions of this Agreement. Whenever any amount
expressed to be due by the terms of this Agreement is due on any day that is not
a Business Day, the same shall instead be due on the next succeeding day that is
a Business Day.
 

 
 
-7-

 
 

(f)             Compliance with Principal Market Rules. Notwithstanding anything
in this Agreement to the contrary, and in addition to the limitations set forth
in Section ‎2‎(g), the Company shall not issue more than 9,592,607 shares
(including the Commitment Shares) of Common Stock (the “Exchange Cap”) under
this Agreement, which equals 19.99% of the Company’s outstanding shares of
Common Stock as of the date hereof, unless stockholder approval is obtained to
issue in excess of the Exchange Cap; provided, however, that the foregoing
limitation shall not apply if at any time the Exchange Cap is reached and at all
times thereafter the average price paid for all shares of Common Stock issued
under this Agreement is equal to or greater than $0.3557 (the “Minimum Price”),
a price equal to the lower of (i) the Nasdaq Official Closing Price immediately
preceding the execution of this Agreement or (ii) the arithmetic average of the
five (5) Nasdaq Official Closing Prices for the Common Stock immediately
preceding the execution of this Agreement, as calculated in accordance with the
rules of the Principal Market (in such circumstance, for purposes of the
Principal Market, the transaction contemplated hereby would not be “below
market” and the Exchange Cap would not apply). Notwithstanding the foregoing,
the Company shall not be required or permitted to issue, and the Buyer shall not
be required to purchase, any shares of Common Stock under this Agreement if such
issuance would violate the rules or regulations of the Principal Market. The
Company may, in its sole discretion, determine whether to obtain stockholder
approval to issue more than 19.99% of its outstanding shares of Common Stock
hereunder if such issuance would require stockholder approval under the rules or
regulations of the Principal Market. The Exchange Cap shall be reduced, on a
share-for-share basis, by the number of shares of Common Stock issued or
issuable that may be aggregated with the transactions contemplated by this
Agreement under applicable rules of the Principal Market.
 
(g)           Beneficial Ownership Limitation. Notwithstanding anything to the
contrary contained in this Agreement, the Company shall not issue or sell, and
the Investor shall not purchase or acquire, any Common Stock under this
Agreement which, when aggregated with all other shares of Common Stock then
beneficially owned by the Investor and its affiliates (as calculated pursuant to
Section 13(d) of the Exchange Act and Rule 13d-3 promulgated thereunder), would
result in the beneficial ownership by the Investor and its affiliates of more
than 9.99% of the then issued and outstanding shares of Common Stock (the
“Beneficial Ownership Limitation”). Upon the written or oral request of the
Investor, the Company shall promptly (but not later than twenty-four (24) hours)
confirm orally or in writing to the Investor the amount of Common Stock then
outstanding. The Investor and the Company shall each cooperate in good faith in
the determinations required hereby and the application hereof.
 
(h) Excess Share Limitation. If the Company delivers any Purchase Notice for a
Purchase Amount in excess of the limitations contained in this Section ‎2, such
Purchase Notice shall be void ab initio to the extent of the amount by which the
number of Purchase Shares set forth in such Purchase Notice exceeds the number
of Purchase Shares which the Company is permitted to include in such Purchase
Notice in accordance herewith, and the Investor shall have no obligation to
purchase such excess Purchase Shares with respect to such Purchase Notice;
provided, however, that the Investor shall remain obligated to purchase the
number of Purchase Shares which the Company is permitted to include in such
Purchase Notice.
 
(i) Adjustments for Shares. All share-related numbers contained in this Section
‎2 shall be adjusted to take into account any reorganization, recapitalization,
non-cash dividend, stock split or other similar transaction effected with
respect to the Common Stock except as specifically stated herein.
 

3.           INVESTOR'S REPRESENTATIONS AND WARRANTIES.
 
The Investor represents and warrants to the Company that as of the date hereof
and as of the Commencement Date:
 
(a) Organization, Authority. The Investor is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, with the requisite power and authority to enter into and to
consummate the transactions contemplated by this Agreement and otherwise to
carry out its obligations hereunder.
 
(b) Investment Purpose.  The Investor is acquiring the Securities as principal
for its own account and not with a view to or for distributing or reselling such
Securities or any part thereof in violation of the Securities Act or any
applicable state securities law, has no present intention of distributing any of
such Securities in violation of the Securities Act or any applicable state
securities law and has no direct or indirect arrangement or understandings with
any other Persons to distribute or regarding the distribution of such Securities
in violation of the Securities Act or any applicable state securities law (this
representation and warranty not limiting the Investor’s right to sell the
Securities at any time pursuant to the Registration Statement described herein
or otherwise in compliance with applicable federal and state securities
laws).  The Investor is acquiring the Securities hereunder in the ordinary
course of its business.
 
 
 
 
-8-

 
 
(c)            Accredited Investor Status. The Investor is an "accredited
investor" as that term is defined in Rule 501(a)(3) of Regulation D promulgated
under the Securities Act.
 
(d)           Reliance on Exemptions. The Investor understands that the
Securities may be offered and sold to it in reliance on specific exemptions from
the registration requirements of United States federal and state securities laws
and that the Company is relying in part upon the truth and accuracy of, and the
Investor's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Investor set forth herein in order to
determine the availability of such exemptions and the eligibility of the
Investor to acquire the Securities.
 
(e)           Information. The Investor understands that its investment in the
Securities involves a high degree of risk. The Investor (i) is able to bear the
economic risk of an investment in the Securities including a total loss thereof,
(ii) has such knowledge and experience in financial and business matters that it
is capable of evaluating the merits and risks of the proposed investment in the
Securities and (iii) has had an opportunity to ask questions of and receive
answers from the officers of the Company concerning the financial condition and
business of the Company and other matters related to an investment in the
Securities. Neither such inquiries nor any other due diligence investigations
conducted by the Investor or its representatives shall modify, amend or affect
the Investor's right to rely on the Company's representations and warranties
contained in Section 4 below. The Investor has sought such accounting, legal and
tax advice as it has considered necessary to make an informed investment
decision with respect to its acquisition of the Securities.
 
(f)           No Governmental Review. The Investor understands that no U.S.
federal or state agency or any other government or governmental agency has
passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of an investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.
 
(g)           Transfer or Sale. The Investor understands that (i) the Securities
may not be offered for sale, sold, assigned or transferred unless (A) registered
pursuant to the Securities Act or (B) an exemption exists permitting such
Securities to be offered, sold, assigned or transferred without such
registration; and (ii) any sale of the Securities made in reliance on Rule 144
may be made only in accordance with the terms of Rule 144 and further, if Rule
144 is not applicable, any resale of the Securities under circumstances in which
the seller (or the Person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the Securities Act) may require
compliance with some other exemption under the Securities Act or the rules and
regulations of the SEC thereunder.
 
(h)           Validity; Enforcement. This Agreement has been duly and validly
authorized, executed and delivered on behalf of the Investor and is a valid and
binding agreement of the Investor enforceable against the Investor in accordance
with its terms, subject as to enforceability to general principles of equity and
to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
and other similar laws relating to, or affecting generally, the enforcement of
applicable creditors' rights and remedies.
 
(i)           Residency. The Investor is a resident of the State of Illinois.
 
(j)           No Short Selling. The Investor represents and warrants to the
Company that at no time prior to the date of this Agreement has any of the
Investor, its agents, representatives or affiliates engaged in or effected, in
any manner whatsoever, directly or indirectly, any (i) "short sale" (as such
term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common
Stock or (ii) hedging transaction, which establishes a net short position with
respect to the Common Stock.
 
(k)           Organization, Authority. The Investor is an entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, with the requisite power and authority to enter into and to
consummate the transactions contemplated by this Agreement and otherwise to
carry out its obligations hereunder.
 
 
 
-9-

 
 
4.           REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
 
The Company represents and warrants to the Investor that, except as set forth in
the disclosure schedules attached hereto or as disclosed in the SEC Documents
(as defined below), which disclosures shall be deemed to be a part of the
representations and warranties made hereunder, as of the date hereof and as of
the Commencement Date:
 
(a)           Organization and Qualification. The Company and each of its
Subsidiaries is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with the requisite corporate 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 of its Subsidiaries is in
violation or default of any of the provisions of its respective articles or
certificate of incorporation, bylaws or other organizational or charter
documents. Each of the Company and its Subsidiaries is duly qualified to conduct
business and is in good standing as a foreign corporation or other entity in
each jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary, except where the failure to be
so qualified or in good standing, as the case may be, could not have or
reasonably be expected to result in a Material Adverse Effect and no proceeding
has been instituted in any such jurisdiction revoking, limiting or curtailing or
seeking to revoke, limit or curtail such power and authority or qualification.
The Company has no Subsidiaries except as set disclosed in the SEC Documents.
 
(b)           Authorization; Enforcement; Validity. (i) The Company has the
requisite corporate power and authority to enter into and perform its
obligations under this Agreement and each of the Transaction Documents, and to
issue the Securities in accordance with the terms hereof and thereof, (ii) the
execution and delivery of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby,
including without limitation, the issuance of the Commitment Shares as defined
below in Section 5(e) and the Initial Purchase Shares and the reservation for
issuance and the issuance of the Purchase Shares issuable under this Agreement,
have been duly authorized by the Company's Board of Directors and no further
consent or authorization is required by the Company, its Board of Directors or
its stockholders (except as provided in this Agreement), (iii) each of this
Agreement and the Registration Rights Agreement has been, and each other
Transaction Document shall be on the Commencement Date, duly executed and
delivered by the Company, and (iv) each of this Agreement and the Registration
Rights Agreement constitutes, and each other Transaction Document upon its
execution on behalf of the Company, shall constitute, the valid and binding
obligations of the Company enforceable against the Company in accordance with
their terms, except as such enforceability may be limited by general principles
of equity or applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement
of creditors' rights and remedies. The Board of Directors of the Company has
approved of resolutions (the “Signing Resolutions”), a copy of which has been
provided to the Investor, authorizing this Agreement, the Registration Rights
Agreement and the transactions contemplated hereby. The Signing Resolutions are
valid, in full force and effect and have not been modified or supplemented in
any respect. The Company has delivered to the Investor a true and correct copy
of a unanimous written consent adopting the Signing Resolutions executed by all
of the members of the Board of Directors of the Company. Except as set forth in
this Agreement, no other approvals or consents of the Company’s Board of
Directors, any authorized committee thereof, and/or stockholders is necessary
under Applicable Laws and the Articles of Incorporation or Bylaws to authorize
the execution and delivery of the Transaction Documents or any of the
transactions contemplated thereby, including, but not limited to, the issuance
of the Commitment Shares and the issuance of the Purchase Shares.
 
 
 
-10-

 
 
(c)           Capitalization. As of the date hereof, the authorized capital
stock of the Company is set forth in Schedule 4(c) hereof. Except as disclosed
in the SEC Documents (as defined below), (i) no shares of the Company’s capital
stock are subject to preemptive rights or any other similar rights or any liens,
encumbrances and defects (“Liens”) suffered or permitted by the Company, (ii)
there are no outstanding debt securities, (iii) there are no outstanding
options, 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 any of its Subsidiaries, or contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to issue additional shares of capital stock
of the Company or any of its Subsidiaries or options, 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 any of its Subsidiaries, (iv) there are no agreements or arrangements
under which the Company or any of its Subsidiaries is obligated to register the
sale of any of their securities under the Securities Act (except the
Registration Rights Agreement), (v) there are no outstanding securities or
instruments of the Company or any of its Subsidiaries which contain any
redemption or similar provisions, and there are no contracts, commitments,
understandings or arrangements by which the Company or any of its Subsidiaries
is or may become bound to redeem a security of the Company or any of its
Subsidiaries, (vi) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Securities as described in this Agreement and (vii) the Company does not
have any stock appreciation rights or "phantom stock" plans or agreements or any
similar plan or agreement. The Company has furnished to the Investor true and
correct copies of the Company's Restated and Amended Articles of Incorporation,
as amended and as in effect on the date hereof (the "Articles of
Incorporation"), and the Company's Amended and Restated Bylaws, as amended and
as in effect on the date hereof (the "Bylaws"), summaries of the terms of all
securities convertible into or exercisable for Common Stock, if any, and copies
of any documents containing the material rights of the holders thereof in
respect thereto.
 
(d)           Issuance of Securities. Upon issuance and payment therefor in
accordance with the terms and conditions of this Agreement, the Purchase Shares
shall be validly issued, fully paid and nonassessable and free from all taxes,
Liens, charges, restrictions, rights of first refusal and preemptive rights with
respect to the issue thereof, with the holders being entitled to all rights
accorded to a holder of Common Stock. Eight Million Seven Hundred Fifty Thousand
(8,750,000) shares of Common Stock have been duly authorized and reserved for
issuance upon purchase under this Agreement as Purchase Shares (excluding the
Initial Purchase Shares). Seven Hundred Fifty Thousand (750,000) shares of
Common Stock have been duly authorized and reserved for issuance as Commitment
Shares (as defined below in Section 5(e)) in accordance with this Agreement. The
Commitment Shares shall be validly issued, fully paid and nonassessable and free
from all taxes, liens, charges, restrictions, rights of first refusal and
preemptive rights with respect to the issue thereof, with the holders being
entitled to all rights accorded to a holder of Common Stock.
 
(e)           No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby (including, without limitation, the
reservation for issuance and the issuance of the Purchase Shares and the
Commitment Shares) will not (i) result in a violation of the Articles of
Incorporation (including any Certificate of Designations, Preferences and Rights
of any outstanding series of preferred stock of the Company or the Bylaws or
(ii) conflict with, or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of its
Subsidiaries is a party, or result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws and
regulations and the rules and regulations of the Principal Market applicable to
the Company or any of its Subsidiaries) or by which any property or asset of the
Company or any of its Subsidiaries is bound or affected, except in the case of
conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations under clause (ii), which could not reasonably be expected to result
in a Material Adverse Effect. Neither the Company nor any Subsidiary is in
violation or default of or under (i) any provision of the Articles of
Incorporation or Bylaws or under its respective certificate or articles of
incorporation, any certificate of designation, preferences and rights of any
outstanding series of preferred stock, organizational charter or bylaws,
respectively, (ii) the terms of any indenture, contract, lease, mortgage, deed
of trust, note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or bound or to which
its property is subject, or (iii) any judgment, order or decree of any court,
regulatory body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its properties, which,
in the case of clauses (ii) or (iii), could be reasonably expected to have a
Material Adverse Effect. Except as specifically contemplated by this Agreement
and as required under the Securities Act or applicable state securities laws and
the rules and regulations of the Principal Market, the Company is not required
to obtain any consent, Authorization or order of, or make any filing or
registration with, any court or governmental agency or any regulatory or
self-regulatory agency in order for it to execute, deliver or perform any of its
obligations under or contemplated by the Transaction Documents in accordance
with the terms hereof or thereof. Except as set forth elsewhere in this
Agreement, all consents, Authorizations, orders, filings and registrations which
the Company is required to obtain pursuant to the preceding sentence shall be
obtained or effected on or prior to the Commencement Date.
 
 
 
-11-

 
 
(f)           SEC Documents; 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 24 months 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 Documents”) on a timely basis or has received a valid
extension of such time of filing and has filed any such SEC Documents prior to
the expiration of any such extension.  As of their respective dates, the SEC
Documents complied in all material respects with the requirements of the
Securities Act and the Exchange Act, as applicable. None of the SEC Documents,
when filed, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. The financial statements of the Company included in
the SEC Documents comply in all material respects with applicable accounting
requirements and the rules and regulations of the SEC 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. Except as set forth in the SEC Documents, the Company has received
no notices or correspondence from the SEC for the one year preceding the date
hereof. The SEC has not commenced any enforcement proceedings against the
Company or any of its Subsidiaries.
 
(g)           Absence of Certain Changes. Except as disclosed in the SEC
Documents, since December 31, 2019, there has been no material adverse change in
the business, properties, operations, financial condition or results of
operations of the Company or its Subsidiaries. The Company has not taken any
steps, and does not currently expect to take any steps, to seek protection
pursuant to any Bankruptcy Law nor does the Company or any of its Subsidiaries
have any knowledge or reason to believe that its creditors intend to initiate
involuntary bankruptcy or insolvency proceedings.
 
(h)           Absence of Litigation. There is no action, suit, proceeding,
inquiry or investigation before or by any court, public board, government
agency, self-regulatory organization or body pending or, to the knowledge of the
Company or any of its Subsidiaries, threatened against or affecting the Company,
the Common Stock or any of the Company's or its Subsidiaries' officers or
directors in their capacities as such, which could reasonably be expected to
have a Material Adverse Effect.
 
(i)           Acknowledgment Regarding Investor's Status. The Company
acknowledges and agrees that the Investor is acting solely in the capacity of
arm's length purchaser with respect to the Transaction Documents and the
transactions contemplated hereby and thereby. The Company further acknowledges
that the Investor is not acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to the Transaction Documents
and the transactions contemplated hereby and thereby and any advice given by the
Investor or any of its representatives or agents in connection with the
Transaction Documents and the transactions contemplated hereby and thereby is
merely incidental to the Investor's purchase of the Securities. The Company
further represents to the Investor that the Company's decision to enter into the
Transaction Documents has been based solely on the independent evaluation by the
Company and its representatives and advisors.
 
(j)           No Aggregated Offering. Neither the Company, nor any of its
affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would cause the transactions
contemplated hereby to be integrated or aggregated with prior offerings by the
Company in a manner that would require stockholder approval pursuant to the
rules of the Principal Market on which any of the securities of the Company are
listed or designated.
 
 
 
-12-

 
 
(k)           Intellectual Property Rights. The Company and its Subsidiaries own
or possess adequate rights or licenses to use all material trademarks, trade
names, service marks, service mark registrations, service names, patents, patent
rights, copyrights, inventions, licenses, approvals, governmental
authorizations, trade secrets and rights necessary to conduct their respective
businesses as now conducted. None of the Company’s material trademarks, trade
names, service marks, service mark registrations, service names, patents, patent
rights, copyrights, inventions, licenses, approvals, government authorizations,
trade secrets or other intellectual property rights have expired or terminated,
or, by the terms and conditions thereof, could expire or terminate within two
years from the date of this Agreement. The Company and its Subsidiaries do not
have any knowledge of any infringement by the Company or its Subsidiaries of any
material trademark, trade name rights, patents, patent rights, copyrights,
inventions, licenses, service names, service marks, service mark registrations,
trade secret or other similar rights of others, or of any such development of
similar or identical trade secrets or technical information by others, and there
is no claim, action or proceeding being made or brought against, or to the
Company’s knowledge, being threatened against, the Company or its Subsidiaries
regarding trademark, trade name, patents, patent rights, invention, copyright,
license, service names, service marks, service mark registrations, trade secret
or other infringement, which could reasonably be expected to have a Material
Adverse Effect.
 
(l)           Environmental Laws. The Company and its Subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and local laws
and regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants (“Environmental Laws”), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where, in each of the
three foregoing clauses, the failure to so comply could not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.
 
(m)           Title. The Company and its Subsidiaries own no real property.
Except as disclosed in the SEC Documents, the Company and its Subsidiaries have
good and marketable title in fee simple to all real property owned by them and
good and marketable title in all personal property owned by them that is
material to the business of the Company and its Subsidiaries, in each case free
and clear of all Liens and, 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 its Subsidiaries and
Liens for the payment of federal, state or other taxes, the payment of which is
neither delinquent nor subject to penalties.  Any real property and facilities
held under lease by the Company and its Subsidiaries are held by them under
valid, subsisting and enforceable leases with which the Company and its
Subsidiaries are in compliance with such exceptions as are not material and do
not interfere with the use made and proposed to be made of such property and
buildings by the Company and its Subsidiaries.
 
(n)           Insurance. The Company and each of its Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as management of the Company believes to be prudent and
customary in the businesses in which the Company and its Subsidiaries are
engaged. Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for and neither the Company nor any such
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 at a cost that could not reasonably be expected to have a Material
Adverse Effect.
 
(o)           Regulatory Permits. The Company and its Subsidiaries possess all
material certificates, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary to conduct
their respective businesses, and neither the Company nor any such Subsidiary has
received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit.
 
(p)           Tax Status. The Company and each of its Subsidiaries has made or
filed all federal and state income and all other material tax returns, reports
and declarations required by any jurisdiction to which it is subject (unless and
only to the extent that the Company and each of its Subsidiaries has set aside
on its books provisions reasonably adequate for the payment of all unpaid and
unreported taxes) and 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, except those being contested in good faith
and has set aside on its books provision reasonably adequate for the payment of
all 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 know of no basis for any such claim.
 
 
 
-13-

 
 
(q)           Transactions With Affiliates.  Except as set forth in the SEC
Documents, none of the officers or directors of the Company and, to the
knowledge of the Company, none of the Company’s stockholders, the officers or
directors of any stockholder of the Company, or any family member or affiliate
of any of the foregoing, has either directly or indirectly any interest in, or
is a party to, any transaction that is required to be disclosed as a related
party transaction pursuant to Item 404 of Regulation S-K promulgated under the
Securities Act.
 
(r)           Application of Takeover Protections. The Company and its Board of
Directors have taken or will take prior to the Commencement Date all necessary
action, if any, in order to render inapplicable any control share acquisition,
business combination, poison pill (including any distribution under a rights
agreement) or other similar anti-takeover provision under the Articles of
Incorporation or the laws of the state of its incorporation which is or could
become applicable to the Investor as a result of the transactions contemplated
by this Agreement, including, without limitation, the Company's issuance of the
Securities and the Investor's ownership of the Securities.
 
(s)            Disclosure.  Except with respect to the material terms and
conditions of the transactions contemplated by the Transaction Documents that
will be timely publicly disclosed by the Company, the Company confirms that
neither it nor any other Person acting on its behalf has provided the Investor
or its agents or counsel with any information that it believes constitutes or
might constitute material, non-public information which is not otherwise
disclosed in the Registration Statement or the SEC Documents.   The Company
understands and confirms that the Investor will rely on the foregoing
representation in effecting purchases and sales of securities of the
Company.  All of the disclosure furnished by or on behalf of the Company to the
Investor regarding the Company, its business and the transactions contemplated
hereby, including the disclosure schedules to this Agreement, is true and
correct in all material respects and does not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. The press releases disseminated by the Company during the
twelve (12) months preceding the date of this Agreement taken as a whole do not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made and when they
were made, not misleading.  The Company acknowledges and agrees that the
Investor neither makes nor has made any representations or warranties with
respect to the transactions contemplated hereby other than those specifically
set forth in Section 3 hereof.
 
(t)           Foreign Corrupt Practices. Neither the Company nor any of the
Subsidiaries nor, to the knowledge of the Company, any director, officer, agent,
employee or affiliate of the Company or any of the Subsidiaries is aware of or
has taken any action, directly or indirectly, that would result in a violation
by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and
the rules and regulations thereunder (the “FCPA”), including, without
limitation, making use of the mails or any means or instrumentality of
interstate commerce corruptly in furtherance of an offer, payment, promise to
pay or authorization of the payment of any money, or other property, gift,
promise to give, or authorization of the giving of anything of value to any
“foreign official” (as such term is defined in the FCPA) or any foreign
political party or official thereof or any candidate for foreign political
office, in contravention of the FCPA; and the Company, the Subsidiaries and, to
the knowledge of the Company, its affiliates have conducted their businesses in
compliance with the FCPA and have instituted and maintain policies and
procedures designed to ensure, and which are reasonably expected to continue to
ensure, continued compliance therewith. The operations of the Company and the
Subsidiaries are and have been conducted at all times in compliance with
applicable financial recordkeeping and reporting requirements and the money
laundering statutes and the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by
any applicable governmental agency, including, without limitation, Title 18 U.S.
Code section 1956 and 1957, the Patriot Act, the Bank Secrecy Act, and
international anti-money laundering principles or procedures by an
intergovernmental group or organization, such as the Financial Action Task Force
on Money Laundering, of which the United States is a member and with which
designation the United States representative to the group or organization
continues to concur, all as amended, and any Executive order, directive or
regulation pursuant to the authority of any of the foregoing, or any orders or
licenses issued thereunder (collectively, the “Money Laundering Laws”), and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
Subsidiaries with respect to the Money Laundering Laws is pending or, to the
knowledge of the Company, threatened. Neither the Company nor any of its
Subsidiaries, nor to the knowledge of the Company any of the directors, officers
or employees, agents, affiliates or representatives of the Company or its
Subsidiaries, is an individual or entity that is, or is owned or controlled by
an individual or entity that is: (i) the subject of any sanctions administered
or enforced by the U.S. Department of Treasury's Office of Foreign Assets
Control, the United Nations Security Council,
 
 
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the European Union, Her Majesty’s Treasury, or other relevant sanctions
authority (collectively, “Sanctions”), nor (ii) located, organized or resident
in a country or territory that is the subject of Sanctions (including, without
limitation, the Balkans, Belarus, Burma/Myanmar, Cote D’Ivoire, Cuba, Democratic
Republic of Congo, Iran, Iraq, Liberia, Libya, North Korea, Sudan, Syria,
Venezuela and Zimbabwe). Neither the Company nor any of its Subsidiaries will,
directly or indirectly, use the proceeds of the transactions contemplated
hereby, or lend, contribute or otherwise make available such proceeds to any
subsidiary, joint venture partner or other individual or entity: (i) to fund or
facilitate any activities or business of or with any individual or entity or in
any country or territory that, at the time of such funding or facilitation, is
the subject of Sanctions or (ii) in any other manner that will result in a
violation of Sanctions by any individual or entity (including any individual or
entity participating in the transactions contemplated hereby, whether as
underwriter, advisor, investor or otherwise). For the past five years, neither
the Company nor any of its Subsidiaries has knowingly engaged in, and is not now
knowingly engaged in, any dealings or transactions with any individual or
entity, or in any country or territory, that at the time of the dealing or
transaction is or was the subject of Sanctions.
 
(u)            DTC Eligibility. The Company, through the Transfer Agent,
currently participates in the DTC Fast Automated Securities Transfer (FAST)
Program and the Common Stock can be transferred electronically to third parties
via the DTC Fast Automated Securities Transfer (FAST) Program.
 
(v)           Accounting Controls; Sarbanes-Oxley. The Company maintains a
system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with management’s
general or specific authorization; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets; (C) access to assets is permitted only in
accordance with management’s general or specific authorization; and (D) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. Except as disclosed in the SEC Documents, the Company has concluded
that its internal control over financial reporting is effective and the Company
is not aware of any “significant deficiencies” or “material weaknesses” (each as
defined by the rules adopted by the SEC) in its internal control over financial
reporting, or any fraud, whether or not material, that involves management or
other employees of the Company and its Subsidiaries who have a significant role
in the Company’s internal controls; and since the end of the latest audited
fiscal year, there has been no change in the Company’s internal control over
financial reporting (whether or not remediated) that has materially affected, or
is reasonably likely to materially affect, the Company’s internal control over
financial reporting. The Board of Directors has, subject to the exceptions, cure
periods and the phase in periods specified in the applicable stock exchange
rules of the Principal Market (“Exchange Rules”), validly appointed an audit
committee to oversee internal accounting controls whose composition satisfies
the applicable independence and other requirements of the Exchange Rules and the
rules under the Exchange Act, and the Board of Directors has adopted a charter
for the audit committee that satisfies the requirements of the Exchange Rules
and the rules under the Exchange Act. No relationship, direct or indirect,
exists between or among the Company, on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Company, on the other
hand, which is required to be described in the Registration Statement which is
not so described. The Company has not, directly or indirectly, extended or
maintained credit, or arranged for the extension of credit, or renewed an
extension of credit, in the form of a personal loan to or for any of its
directors or executive officers in violation of Applicable Laws, including
Section 402 of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith.
 
(w)           Certain Fees. 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 the Transaction Documents. The Investor 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
4(w) that may be due in connection with the transactions contemplated by the
Transaction Documents.
 
(x)           Investment Company. The Company is not, and immediately after
giving effect to the sale of the Purchase Shares in accordance with this
Agreement and the application of the proceeds as described in the Registration
Statement under the caption “Use of Proceeds,” will not be, an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.
 
 
 
-15-

 
 
(y)           Listing and Maintenance Requirements. The Common Stock is
registered pursuant to Section 12(b) of the Exchange Act, and the Company has
taken no action designed to, or which to its knowledge is likely to have the
effect of, terminating the registration of the Common Stock pursuant to the
Exchange Act nor has the Company received any notification that the SEC is
currently contemplating terminating such registration. Except as disclosed in
the SEC Documents, the Company has not, in the twelve (12) months preceding the
date hereof, received any notice from any Person to the effect that the Company
is not in compliance with the listing or maintenance requirements of the
Principal Market. Except as disclosed in the SEC Documents, the Company is, and
has no reason to believe that it will not in the foreseeable future continue to
be, in compliance with all such listing and maintenance requirements.
 
(z)           Accountants. The Company’s accountants are set forth in the SEC
Documents and, to the knowledge of the Company, such accountants are an
independent registered public accounting firm as required by the Securities Act.
 
(aa)           No Market Manipulation.  The Company has not, and to its
knowledge no Person 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 Securities, (ii) sold, bid for, purchased, or, paid any compensation
for soliciting purchases of, any of the Securities, or (iii) paid or agreed to
pay to any Person any compensation for soliciting another to purchase any other
securities of the Company.
 
(bb)           Shell Company Status. The Company is not currently, and has never
been, an issuer identified in Rule 144(i)(1) under the Securities Act.
 
(cc)           Benefit Plans; Labor Matters. Each benefit and compensation plan,
agreement, policy and arrangement that is maintained, administered or
contributed to by the Company for current or former employees or directors of,
or independent contractors with respect to, the Company has been maintained in
compliance with its terms and the requirements of any applicable statutes,
orders, rules and regulations, and the Company has complied in all material
respects with all applicable statutes, orders, rules and regulations in regard
to such plans, agreements, policies and arrangements. Each stock option granted
under any equity incentive plan of the Company (each, a “Stock Plan”) was
granted with a per share exercise price no less than the market price per common
share on the grant date of such option in accordance with the rules of the
Principal Market, and no such grant involved any “back-dating,” “forward-dating”
or similar practice with respect to the effective date of such grant; each such
option (i) was granted in compliance in all material respects with Applicable
Laws and with the applicable Stock Plan(s), (ii) was duly approved by the Board
of Directors or a duly authorized committee thereof, and (iii) has been (or will
be, if granted after December 31, 2019) properly accounted for in the Company’s
financial statements and disclosed, to the extent required, in the Company’s
filings or submissions with the SEC, and the Principal Market. No labor problem
or dispute with the employees of the Company exists or is threatened or
imminent, and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its principal suppliers or contractors,
that would have a Material Adverse Effect.
 
(dd)           Regulatory. During the 12-month period immediately preceding the
date hereof, except as described in the SEC Documents, the Company and each of
its Subsidiaries: (A) is and at all times has been in material compliance with
all applicable U.S. and foreign statutes, rules, regulations, or guidance
applicable to Company and its Subsidiaries (“Applicable Laws”), except as would
not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect; (B) have not received any notice of adverse finding,
warning letter, untitled letter or other correspondence or notice from the U.S.
Food and Drug Administration or any other federal, state, or foreign
governmental authority having authority over the Company (“Governmental
Authority”) alleging or asserting noncompliance with any Applicable Laws or any
licenses, certificates, approvals, clearances, authorizations, permits and
supplements or amendments thereto required by any such Applicable Laws
(“Authorizations”); (C) possess all material Authorizations and such material
Authorizations are valid and in full force and effect and are not in violation
of any term of any such material Authorizations; (D) have not received notice of
any claim, action, suit, proceeding, hearing, enforcement, investigation,
arbitration or other action from any Governmental Authority or third party
alleging that any product, operation or activity is in violation of any
Applicable Laws or Authorizations and have no knowledge that any such
Governmental Authority or third party is considering any such claim, litigation,
arbitration, action, suit, investigation or proceeding; (E) have not received
notice that any Governmental Authority has taken, is taking or intends to take
action to limit, suspend, modify or revoke any Authorizations and the Company
has no
 
 
 
-16-

 
 
knowledge that any such Governmental Authority is considering such action; and
(F) have filed, obtained, maintained or submitted all material reports,
documents, forms, notices, applications, records, claims, submissions and
supplements or amendments as required by any Applicable Laws or material
Authorizations and that all such reports, documents, forms, notices,
applications, records, claims, submissions and supplements or amendments were
complete and correct in all material respects on the date filed (or were
corrected or supplemented by a subsequent submission). During the 12-month
period immediately preceding the date hereof, to the Company’s knowledge, the
studies, tests and preclinical and clinical trials conducted by or on behalf of
the Company were conducted, and, if still pending, are, in all material
respects, being conducted, in accordance with experimental protocols, procedures
and controls pursuant to accepted professional scientific standards and all
Applicable Laws, including, without limitation, the United States Federal Food,
Drug and Cosmetic Act or any; the descriptions of the top-line results of such
studies, tests and trials contained in the SEC Documents are accurate and
complete in all material respects and fairly present the top-line data derived
from such studies, tests and trials; the descriptions in the SEC Documents of
the results of such clinical trials are consistent in all material respects with
such results and to the Company’s knowledge there are no other studies or other
clinical trials whose results are materially inconsistent with or otherwise
materially call into question the results described or referred to in the SEC
Documents; and the Company has not received any notices or correspondence from
any Governmental Authority requiring the termination, suspension or material
modification of any studies, tests or preclinical or clinical trials conducted
by or on behalf of the Company or its Subsidiaries. The Company has concluded
that it uses commercially reasonable efforts to review, from time to time, the
progress and results of the studies, tests and preclinical and clinical trials
and, based upon (i) the information provided to the Company by the third parties
conducting such studies, tests, preclinical studies and clinical trials that are
described in the SEC Documents and the Company’s review of such information, and
(ii) the Company’s actual knowledge, the Company reasonably believes that the
descriptions of the top-line results of such studies, tests, preclinical studies
and clinical trials are accurate and complete in all material respects
 
(ee)           No Disqualification Events. None of the Company, any of its
predecessors, any affiliated issuer, any director, executive officer, other
officer of the Company participating in the transactions contemplated hereby,
any beneficial owner of 20% or more of the Company's outstanding voting equity
securities, calculated on the basis of voting power, nor any promoter (as that
term is defined in Rule 405 under the Securities Act) connected with the Company
in any capacity at the time of sale (each, an “Issuer Covered Person”) is
subject to any of the “Bad Actor” disqualifications described in Rule
506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”),
except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3) under
the Securities Act. The Company has exercised reasonable care to determine
whether any Issuer Covered Person is subject to a Disqualification Event.
 
(ee)           Absence of Schedules. In the event of an undelivered disclosure
schedule to any of the representations and warranties set forth in this Section
4, the Company hereby acknowledges and agrees that each such undelivered
disclosure schedule shall be deemed to read as follows: “Nothing to Disclose”.
 
5.           COVENANTS.
 
(a)           Filing of Current Report and Registration Statement. The Company
agrees that it shall, within the time required under the Exchange Act, file with
the SEC a report on Form 8-K relating to the transactions contemplated by, and
describing the material terms and conditions of, the Transaction Documents (the
“Current Report”). The Company shall also file with the SEC by April 30, 2020 a
new registration statement (the “Registration Statement”) covering only the
resale of Purchase Shares, the Initial Purchase Shares and the Commitment
Shares, in accordance with the terms of the Registration Rights Agreement. The
Company shall permit the Investor to review and comment upon the final
pre-filing draft version of the Current Report at least one (1) Business Day
prior to its filing with the SEC, and the Company shall not file the Current
Report or the Registration Statement with the SEC in a form to which the
Investor reasonably objects. The Investor shall use its reasonable best efforts
to comment upon the final pre-filing draft version of the Current Report within
on the Business Day the Investor receives it from the Company.
 
(b)           Blue Sky. The Company shall take all such action, if any, as is
reasonably necessary in order to obtain an exemption for or to register or
qualify (i) the issuance of the Commitment Shares and the sale of the Purchase
Shares to the Investor under this Agreement and (ii) any subsequent resale of
all Commitment Shares and all Purchase Shares by the Investor, in each case,
under applicable securities or “Blue Sky” laws of the states of the United
States in such states as is reasonably requested by the Investor from time to
time, and shall provide evidence of any such action so taken to the Investor.
 
 
 
-17-

 
 
(c)           Listing/DTC. The Company shall promptly secure the listing of all
of the Purchase Shares and Commitment Shares to be issued to the Investor
hereunder on the Principal Market (subject to official notice of issuance) and
upon each other national securities exchange or automated quotation system, if
any, upon which the Common Stock is then listed, and shall maintain, so long as
any shares of Common Stock shall be so listed, such listing of all such
Securities from time to time issuable hereunder. The Company shall maintain the
listing of the Common Stock on the Principal Market and shall comply in all
respects with the Company’s reporting, filing and other obligations under the
bylaws or rules and regulations of the Principal Market. Neither the Company nor
any of its Subsidiaries shall take any action that would reasonably be expected
to result in the delisting or suspension of the Common Stock on the Principal
Market. The Company shall promptly, and in no event later than the following
Business Day, provide to the Investor copies of any notices it receives from any
Person regarding the continued eligibility of the Common Stock for listing on
the Principal Market; provided, however, that the Company shall not provide the
Investor copies of any such notice that the Company reasonably believes
constitutes material non-public information, and the Company would not be
required to publicly disclose such notice in any report or statement filed with
the SEC under the Exchange Act (including on Form 8-K) or the Securities Act.
The Company shall pay all fees and expenses in connection with satisfying its
obligations under this Section 5(c). The Company shall take all action necessary
to ensure that its Common Stock can be transferred electronically as DWAC
Shares.
 
(d)           Prohibition of Short Sales and Hedging Transactions. The Investor
agrees that beginning on the date of this Agreement and ending on the date of
termination of this Agreement as provided in Section 11, the Investor and its
agents, representatives and affiliates shall not in any manner whatsoever enter
into or effect, directly or indirectly, any (i) “short sale” (as such term is
defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common Stock
or (ii) hedging transaction, which establishes a net short position with respect
to the Common Stock.
 
(e)           Issuance of Commitment Shares. In consideration for the Investor’s
execution and delivery of this Agreement, the Company shall cause to be issued
to the Investor a total of Seven Hundred Fifty Thousand (750,000) shares of
Common Stock (the “Commitment Shares”) directly to the Investor and shall
deliver to the Transfer Agent the Irrevocable Transfer Agent Instructions (as
defined below). For the avoidance of doubt, all of the Commitment Shares shall
be fully earned as of the date of this Agreement, whether or not the
Commencement shall occur or any Purchase Shares, except the Initial Purchase
Shares, are purchased by the Investor under this Agreement and irrespective of
any termination of this Agreement.
 
(f)           Due Diligence; Non-Public Information. The Investor shall have the
right, from time to time as the Investor may reasonably deem appropriate, to
perform reasonable due diligence on the Company during normal business hours.
The Company and its officers and employees shall provide information and
reasonably cooperate with the Investor in connection with any reasonable request
by the Investor related to the Investor’s due diligence of the Company. Each
party hereto agrees not to disclose any Confidential Information of the other
party to any third party and shall not use the Confidential Information for any
purpose other than in connection with, or in furtherance of, the transactions
contemplated hereby in full compliance with applicable securities laws. Each
party hereto acknowledges that the Confidential Information shall remain the
property of the disclosing party and agrees that it shall take all reasonable
measures to protect the secrecy of any Confidential Information disclosed by the
other party. The Company confirms that neither it nor any other Person acting on
its behalf shall provide the Investor or its agents or counsel with any
information that constitutes or might constitute material, non-public
information, unless a public announcement thereof is made by the Company in the
manner contemplated by Regulation FD under the Exchange Act. In the event of a
breach of the foregoing covenant by the Company or any Person acting on its
behalf (as determined in the reasonable good faith judgment of the Investor), in
addition to any other remedy provided herein or in the other Transaction
Documents, the Investor shall have the right to make a public disclosure, in the
form of a press release, public advertisement or otherwise, of such material,
non-public information without the prior approval by the Company; provided the
Investor shall have first provided notice to the Company that it believes it has
received information that constitutes material, non-public information, the
Company shall have at least one (1) Business Day to publicly disclose such
material, non-public information prior to any such disclosure by the Investor,
and the Company shall have failed to publicly disclose such material, non-public
information within such time period. The Investor shall not have any liability
to the Company, any of its Subsidiaries, or any of their respective directors,
officers, employees, stockholders or agents, for any such disclosure. The
Company understands and confirms that the Investor shall be relying on the
foregoing covenants in effecting transactions in securities of the Company.
 
 

 
 
-18-

 
 
 
(g)            Purchase Records. The Investor and the Company shall each
maintain records showing the remaining Available Amount at any given time and
the dates and Purchase Amounts for each Regular Purchase, Accelerated Purchase
and Additional Accelerated Purchase or shall use such other method, reasonably
satisfactory to the Investor and the Company.
 
(h)           Taxes.  The Company shall pay any and all transfer, stamp or
similar taxes that may be payable with respect to the issuance and delivery of
any shares of Common Stock to the Investor made under this Agreement.
 
(i)           Aggregation.  From and after the date of this Agreement, neither
the Company, nor or any of its affiliates will, and the Company shall use its
reasonable best efforts to ensure that no Person acting on their behalf will,
directly or indirectly, make any offers or sales of any security or solicit any
offers to buy any security, under circumstances that would cause this offering
of the Securities by the Company to the Investor to be aggregated with other
offerings by the Company in a manner that would require stockholder approval
pursuant to the rules of the Principal Market on which any of the securities of
the Company are listed or designated, unless stockholder approval is obtained
before the closing of such subsequent transaction in accordance with the rules
of such Principal Market.
 
(j)           Use of Proceeds. The Company may use the net proceeds from any
sale of Purchase Shares for any corporate purpose at its sole discretion.
 
(k)           Other Transactions. The Company shall not enter into, announce or
recommend to its stockholders any agreement, plan, arrangement or transaction in
or of which the terms thereof would restrict, materially delay, conflict with or
impair the ability or right of the Company to perform its obligations under the
Transaction Documents, including, without limitation, the obligation of the
Company to deliver the Purchase Shares and the Commitment Shares to the Investor
in accordance with the terms of the Transaction Documents.
 
(h)           Integration. From and after the date of this Agreement, neither
the Company, nor any of its affiliates will, and the Company shall use its
reasonable best efforts to ensure that no Person acting on their behalf will,
directly or indirectly, make any offers or sales of any security or solicit any
offers to buy any security, under circumstances that would require registration
of the offer and sale of any of the Securities under the Securities Act.
 
(i)           Limitation on Variable Rate Transactions. From and until the later
of: (i) Twenty-Four (24) months from the date hereof or (ii) the Maturity Date
(irrespective of any earlier termination of this Agreement, the Company shall be
prohibited from effecting or entering into an agreement to effect any issuance
by the Company or any of its Subsidiaries of Common Stock or Common Stock
Equivalents (or a combination of units thereof) involving a Variable Rate
Transaction, other than in connection with an Exempt Issuance. The Investor
shall be entitled to seek injunctive relief against the Company and its
Subsidiaries to preclude any such issuance, which remedy shall be in addition to
any right to collect damages, without the necessity of showing economic loss and
without any bond or other security being required. “Common Stock Equivalents”
means any securities of the Company or its Subsidiaries which entitle the holder
thereof to acquire at any time Common Stock, including, without limitation, any
debt, preferred stock, rights, options, warrants or other instrument that is at
any time convertible into or exercisable or exchangeable for, or otherwise
entitles the holder thereof to receive, Common Stock. “Variable Rate
Transaction” means a transaction, from and until the later of (i) twenty-four
(24) months from the date hereof or (ii) the Maturity Date, in which the Company
(i) issues or sells any equity or debt securities that are convertible into,
exchangeable or exercisable for, or include the right to receive additional
shares of Common Stock or Common Stock Equivalents either (A) at a conversion
price, exercise price, exchange rate or other price that is based upon and/or
varies with the trading prices of or quotations for the Common Stock at any time
after the initial issuance of such equity or debt securities (including, without
limitation, pursuant to any “cashless exercise” provision), or (B) with a
conversion, exercise or exchange price that is subject to being reset at some
future date after the initial issuance of such equity or debt security or upon
the occurrence of specified or contingent events directly or indirectly related
to the business of the Company or the market for the Common Stock (including,
without limitation, any “full ratchet” or “weighted average” anti-dilution
provisions, but not including any standard anti-dilution protection for any
reorganization, recapitalization, non-cash dividend, stock split, reverse stock
split or other similar transaction), (ii) issues or sells any equity or debt
securities, including without limitation, Common Stock or Common Stock
Equivalents, either (A) at a price that is subject to being reset at some future
date after the initial issuance of such debt or equity security or upon the
occurrence of specified or contingent events directly or indirectly related to
the business of the Company or the market for the Common Stock (other than
standard anti-dilution protection for any reorganization, recapitalization,
non-cash
 
 
 
-19-

 
 
 
dividend, stock split, reverse stock split or other similar transaction), or (B)
that is subject to or contains any put, call, redemption, buy-back, price-reset
or other similar provision or mechanism (including, without limitation, a
“Black-Scholes” put or call right) that provides for the issuance of additional
equity securities of the Company or the payment of cash by the Company, or (iii)
enters into any agreement, including, but not limited to, an “equity line”,
“at-the-market offering” that is not an Exempt Issuance or other continuous
offering or similar offering of Common Stock or Common Stock Equivalents,
whereby the Company may sell Common Stock or Common Stock Equivalents at a
future determined price. “Exempt Issuance” means the issuance of (a) Common
Stock, options, restricted stock units or other equity incentive awards to
employees, officers, directors or vendors of the Company pursuant to any equity
incentive plan duly adopted for such purpose, by the Board of Directors of the
Company or a majority of the members of a committee of directors established for
such purpose, (b) any Securities issued to the Investor pursuant to this
Agreement, (c) shares of Common Stock, Common Stock Equivalents or other
securities issued to the Investor pursuant to any other existing or future
contract, agreement or arrangement between the Company and the Investor, (d)
shares of Common Stock, Common Stock Equivalents or other securities upon the
exercise, exchange or conversion of any shares of Common Stock, Common Stock
Equivalents or other securities held by the Investor at any time, (e) any
securities issued upon the exercise or exchange of or conversion of any Common
Stock Equivalents issued and outstanding on the date hereof, provided that such
securities or Common Stock Equivalents referred to in this clause (e) have not
been amended since the date hereof to increase the number of such securities or
Common Stock underlying such securities or to decrease the exercise price,
exchange price or conversion price of such securities, (f) Common Stock
Equivalents that are convertible into, exchangeable or exercisable for, or
include the right to receive shares of Common Stock at a conversion price,
exercise price, exchange rate or other price (which may be below the then
current market price of the Common Stock) that is fixed at the time of initial
issuance of such Common Stock Equivalents (subject only to standard
anti-dilution protection for any reorganization, recapitalization, non-cash
dividend, stock split, reverse stock split or other similar transaction), which
fixed conversion price, exercise price, exchange rate or other price shall not
at any time after the initial issuance of such Common Stock Equivalent be based
upon or varying with the trading prices of or quotations for the Common Stock or
subject to being reset at some future date, (g) securities issued pursuant to
acquisitions, divestitures, licenses, partnerships, collaborations or strategic
transactions approved by the Board of Directors of the Company or a majority of
the members of a committee of directors established for such purpose, which
acquisitions, divestitures, licenses, partnerships, collaborations or strategic
transactions can have a Variable Rate Transaction component, provided that any
such issuance shall only be to a Person (or to the equity holders of a Person)
which is, itself or through its subsidiaries, an operating company or an asset
in a business synergistic with the business of the Company and shall provide to
the Company additional benefits in addition to the investment of funds, but
shall not include a transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities, (h) Common Stock issued pursuant to an
“at-the-market offering” by the Company exclusively through a registered
broker-dealer acting as agent of the Company pursuant to a written agreement
between the Company and such registered broker-dealer or (i) equity securities
issued in connection with future financings or offerings of the Company, such as
but not limited to, registered direct offerings, rights offerings, and
confidentially marketed public offerings; provided such underlying transactions
do not involve a Variable Rate Transaction.
 
6.           TRANSFER AGENT INSTRUCTIONS.
 
(a)   On the date of this Agreement, the Company shall issue irrevocable
instructions to the Transfer Agent substantially in the form attached hereto as
Exhibit C to issue the Initial Purchase Shares and the Commitment Shares in
accordance with the terms of this Agreement (the “Irrevocable Transfer Agent
Instructions”). The certificate(s) or book-entry statement(s) representing the
Initial Purchase Shares and the Commitment Shares, except as set forth below,
shall bear the following restrictive legend (the “Restrictive Legend”):
 
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL,
IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
APPLICABLE STATE SECURITIES LAWS.
 
 
 
-20-

 
 
(b) On the earlier of (i) the Commencement Date and (ii) such time that the
Investor shall request, provided all conditions of Rule 144 under the Securities
Act are met, the Company shall, no later than one (1) Business Day following the
delivery by the Investor to the Company or the Transfer Agent of one or more
legended certificates or book-entry statements representing the Initial Purchase
Shares and the Commitment Shares (which certificates or book-entry statements
the Investor shall promptly deliver on or prior to the first to occur of the
events described in clauses (i) and (ii) of this sentence), as directed by the
Investor, issue and deliver (or cause to be issued and delivered) to the
Investor, as requested by the Investor, either: (A) a certificate or book-entry
statement representing such Initial Purchase Shares and Commitment Shares that
is free from all restrictive and other legends or (B) a number of shares of
Common Stock equal to the number of Commitment Shares represented by the
certificate(s) or book-entry statement(s) so delivered by the Investor as DWAC
Shares. The Company shall take all actions to carry out the intent and
accomplish the purposes of the immediately preceding sentence, including,
without limitation, delivering all such legal opinions, consents, certificates,
resolutions and instructions to the Transfer Agent, and any successor transfer
agent of the Company, as may be requested from time to time by the Investor or
necessary or desirable to carry out the intent and accomplish the purposes of
the immediately preceding sentence. On the Commencement Date, the Company shall
issue to the Transfer Agent, and any subsequent transfer agent, (i) irrevocable
instructions in the form substantially similar to those used by the Investor in
substantially similar transactions (the “Commencement Irrevocable Transfer Agent
Instructions”) and (ii) the notice of effectiveness of the Registration
Statement in the form attached as an exhibit to the Registration Rights
Agreement (the “Notice of Effectiveness of Registration Statement”), in each
case to issue the Initial Purchase Shares and the Commitment Shares and the
Purchase Shares in accordance with the terms of this Agreement and the
Registration Rights Agreement. All Purchase Shares to be issued from and after
Commencement to or for the benefit of the Investor pursuant to this Agreement
shall be issued only as DWAC Shares. The Company represents and warrants to the
Investor that, while this Agreement is effective, no instruction other than the
Commencement Irrevocable Transfer Agent Instructions and the Notice of
Effectiveness of Registration Statement referred to in this Section 6(b) will be
given by the Company to the Transfer Agent with respect to the Commitment Shares
or the Purchase Shares from and after Commencement, and the Commitment Shares,
and the Purchase Shares and the Commitment Shares covered by the Registration
Statement shall otherwise be freely transferable on the books and records of the
Company. The Company agrees that if the Company fails to fully comply with the
provisions of this Section 6(b) within five (5) Business Days of the Investor
providing the deliveries referred to above, the Company shall, at the Investor’s
written instruction, purchase such shares of Common Stock containing the
Restrictive Legend from the Investor at the greater of the (i) Purchase Price or
Accelerated Purchase Price paid for such shares of Common Stock (as applicable)
and (ii) the Closing Sale Price of the Common Stock on the date of the
Investor’s written instruction.
 
7.  CONDITIONS TO THE COMPANY'S RIGHT TO COMMENCE SALES OF SHARES OF COMMON
STOCK.
 
The right of the Company hereunder to commence sales of the Purchase Shares
(other than the Initial Purchase Shares) on the Commencement Date is subject to
the satisfaction of each of the following conditions:
 
(a)            The Investor shall have executed each of the Transaction
Documents and delivered the same to the Company;
 
(b)            The Registration Statement covering the resale of the Purchase
Shares in accordance with the Registration Rights Agreement and all of the
Initial Purchase Shares and Commitment Shares shall have been declared effective
under the Securities Act by the SEC, and no stop order with respect to the
Registration Statement shall be pending or threatened by the SEC;
 
(c)   All Securities to be issued by the Company to the Investor under the
Transaction Documents shall have been approved for listing on the Principal
Market in accordance with the applicable rules and regulations of the Principal
Market, subject only to official notice of issuance; and
 

(d)            The representations and warranties of the Investor shall be true
and correct in all material respects as of the date hereof and as of the
Commencement Date as though made at that time.
 
 
 
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8.  CONDITIONS TO THE INVESTOR'S OBLIGATION TO PURCHASE SHARES OF COMMON STOCK.
 
The obligation of the Investor to buy Purchase Shares (other than the Initial
Purchase Shares) under this Agreement is subject to the satisfaction of each of
the following conditions on or prior to the Commencement Date and, once such
conditions have been initially satisfied, there shall not be any ongoing
obligation to satisfy such conditions after the Commencement has occurred:
 
(a)           The Company shall have executed each of the Transaction Documents
and delivered the same to the Investor;
 
(b)            The Company shall have caused the Commitment Shares and the
Initial Purchase Shares to be delivered as DWAC Shares or (ii) removed all
restrictive and other legends from the certificates or book-entry statements
representing the Commitment Shares, in each case in accordance with Section
‎6(b);
 
(c)           The Common Stock shall be listed or quoted on the Principal
Market, trading in the Common Stock shall not have been within the last 365 days
suspended by the SEC or the Principal Market for one or more Trading Day, and
all Securities to be issued by the Company to the Investor pursuant to this
Agreement shall have been, approved for listing or quotation on the Principal
Market in accordance with the applicable rules and regulations of the Principal
Market, subject only to official notice of issuance;
 
(d)           The Investor shall have received the opinion letter of the
Company's legal counsel dated as of the Commencement Date substantially in the
form agreed prior to the date of this Agreement by the Company’s legal counsel
and the Investor’s legal counsel;
 
(e)           The representations and warranties of the Company shall be true
and correct in all material respects (except to the extent that any of such
representations and warranties is already qualified as to materiality in Section
4 above, in which case, such representations and warranties shall be true shall
be true and correct without further qualification) as of the date hereof and as
of the Commencement Date as though made at that time (except for representations
and warranties that speak as of a specific date, which and correct as of such
date) and the Company shall have performed, satisfied and complied with the
covenants, agreements and conditions required by the Transaction Documents to be
performed, satisfied or complied with by the Company at or prior to the
Commencement Date. The Investor shall have received a certificate, executed by
the CEO, President or CFO of the Company, dated as of the Commencement Date, to
the foregoing effect in the form attached hereto as Exhibit A;
 
(f)           The Board of Directors of the Company shall have adopted the
Signing Resolutions, which shall be in full force and effect without any
amendment or supplement thereto as of the Commencement Date;
 
(g)           As of the Commencement Date, the Company shall have reserved out
of its authorized and unissued Common Stock, solely for the purpose of effecting
purchases of Purchase Shares hereunder (other than the Initial Purchase Shares),
Eight Million Seven Hundred Fifty Thousand (8,750,000) shares of Common Stock;
 
(h)           The Commencement Irrevocable Transfer Agent Instructions and the
Notice of Effectiveness of Registration Statement each shall have been delivered
to and acknowledged in writing by the Company and the Company’s Transfer Agent
(or any successor transfer agent);
 
(i)           The Company shall have delivered to the Investor (i) a certificate
evidencing the incorporation and good standing of the Company in the State of
Nevada issued by the Secretary of State of the State of Nevada and (ii) a
certificate or its equivalent evidencing the good standing of the Company as a
foreign corporation in the State of California, issued by the Secretary of State
of the State of California, and in any other jurisdiction where the Company is
duly qualified to conduct business, in each case, as of a date within ten (10)
Business Days of the Commencement Date;
 
(j)           The Company shall have delivered to the Investor a certified copy
of the Articles of Incorporation as certified by the Secretary of State of the
State of Nevada within ten (10) Business Days of the Commencement Date;
 
 
 
-22-

 
 
(k)           The Company shall have delivered to the Investor a secretary's
certificate executed by the Secretary of the Company, dated as of the
Commencement Date, in the form attached hereto as Exhibit B;
 
(l)           The Registration Statement covering the resale of such number of
the Purchase Shares as the Company is permitted to register under the
Registration Statement pursuant to the Registration Rights Agreement and all of
the Initial Purchase Shares and Commitment Shares shall have been declared
effective under the Securities Act by the SEC, and no stop order with respect to
the Registration Statement shall be in effect or threatened by the SEC. The
Company shall have prepared and filed with the SEC, not later than one (1)
Business Day after the effective date of the Registration Statement, a final and
complete prospectus (the preliminary form of which shall be included in the
Registration Statement) and shall have delivered to the Investor a true and
complete copy thereof. Such prospectus shall be current and available for the
resale by the Investor of all of the Securities covered thereby. The Current
Report shall have been filed with the SEC, as required pursuant to Section 5(a).
All reports, schedules, registrations, forms, statements, information and other
documents required to have been filed by the Company with the SEC at prior to
the Commencement Date pursuant to the reporting requirements of the Exchange Act
shall have been filed with the SEC within the applicable time periods prescribed
for such filings under the Exchange Act;
 
(m)           No Event of Default has occurred, or any event which, after notice
and/or lapse of time, would become an Event of Default has occurred;
 
(n)           All federal, state and local governmental laws, rules and
regulations applicable to the transactions contemplated by the Transaction
Documents and necessary for the execution, delivery and performance of the
Transaction Documents and the consummation of the transactions contemplated
thereby in accordance with the terms thereof shall have been complied with, and
all consents, Authorizations and orders of, and all filings and registrations
with, all federal, state and local courts or governmental agencies and all
federal, state and local regulatory or self-regulatory agencies necessary for
the execution, delivery and performance of the Transaction Documents and the
consummation of the transactions contemplated thereby in accordance with the
terms thereof shall have been obtained or made, including, without limitation,
in each case those required under the Securities Act, the Exchange Act,
applicable state securities or “Blue Sky” laws or applicable rules and
regulations of the Principal Market, or otherwise required by the SEC, the
Principal Market or any state securities regulators;
 
(o)           No statute, regulation, order, decree, writ, ruling or injunction
shall have been enacted, entered, promulgated, threatened or endorsed by any
federal, state, local or foreign court or Governmental Authority of competent
jurisdiction which prohibits the consummation of or which would materially
modify or delay any of the transactions contemplated by the Transaction
Documents;
 
(p)           No action, suit or proceeding before any federal, state, local or
foreign arbitrator or any court or Governmental Authority of competent
jurisdiction shall have been commenced or threatened, and no inquiry or
investigation by any federal, state, local or foreign Governmental Authority of
competent jurisdiction shall have been commenced or threatened, against the
Company, or any of the officers, directors or affiliates of the Company, seeking
to restrain, prevent or change the transactions contemplated by the Transaction
Documents, or seeking material damages in connection with such transactions; and
 
(q)           The Company shall have provided the Investor with the information
requested by the Investor in connection with its due diligence requests in
accordance with the terms of Section 5(f) hereof.
 
 
 
-23-

 
 
9.  INDEMNIFICATION.
 
In consideration of the Investor’s execution and delivery of the Transaction
Documents and acquiring the Securities hereunder and in addition to all of the
Company’s other obligations under the Transaction Documents, the Company shall
defend, protect, indemnify and hold harmless the Investor and all of its
affiliates, stockholders, officers, directors, members, managers, employees and
direct or indirect investors and any of the foregoing Person’s agents or other
representatives (including, without limitation, those retained in connection
with the transactions contemplated by this Agreement) (collectively, the
“Indemnitees”) from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith (irrespective of whether any such Indemnitee is a party to
the action for which indemnification hereunder is sought), and including
reasonable attorneys' fees and disbursements (the “Indemnified Liabilities”),
incurred by any Indemnitee as a result of, or arising out of or relating to: (a)
any misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby, (b) any breach of any covenant,
agreement or obligation of the Company contained in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby,
(c) any cause of action, suit or claim brought or made against such Indemnitee
and arising out of or resulting from the execution, delivery, performance or
enforcement of the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby, (d) any violation of the Securities
Act, the Exchange Act, state securities or “Blue Sky” laws, or the rules and
regulations of the Principal Market in connection with the transactions
contemplated by the Transaction Documents by the Company or any of its
Subsidiaries, affiliates, officers, directors or employees, (e) any untrue
statement or alleged untrue statement of a material fact contained, or
incorporated by reference, in the Registration Statement or any amendment
thereto or any omission or alleged omission to state therein, or in any document
incorporated by reference therein, a material fact required to be stated therein
or necessary to make the statements therein not misleading, or (f) any untrue
statement or alleged untrue statement of a material fact contained, or
incorporated by reference, in the Registration Statement, or any omission or
alleged omission to state therein, or in any document incorporated by reference
therein, a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that (I) the indemnity contained in clause
(c) of this Section ‎9 shall not apply to any Indemnified Liabilities which
directly and primarily result from the fraud, gross negligence or willful
misconduct of an Indemnitee, (II) the indemnity contained in clauses (d), (e)
and (f) of this Section ‎9 shall not apply to any Indemnified Liabilities to the
extent, but only to the extent, arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of the Investor expressly for use in any Registration
Statement and (III) the indemnity in this Section ‎9 shall not apply to amounts
paid in settlement of any claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably
withheld, conditioned or delayed. To the extent that the foregoing undertaking
by the Company may be unenforceable for any reason, the Company shall make the
maximum contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law, provided that no seller
of Securities guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
seller of Securities who was not guilty of fraudulent misrepresentation. Payment
under this indemnification shall be made within thirty (30) days from the date
the Indemnitee makes written request for it. A certificate containing reasonable
detail as to the amount of such indemnification submitted to the Company by the
Indemnitee shall be conclusive evidence, absent manifest error, of the amount
due from the Company to the Indemnitee. If any action shall be brought against
any Indemnitee with respect to which indemnity may be sought pursuant to this
Agreement, such Indemnitee shall promptly notify the Company in writing, and the
Company shall have the right to assume the defense thereof with counsel of its
own choosing reasonably acceptable to the Indemnitee. Any Indemnitee shall have
the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnitee, except to the extent that (i) the employment thereof
has been specifically authorized by the Company in writing, (ii) the Company has
failed after a reasonable period of time to assume such defense and to employ
counsel or (iii) in such action there is, in the reasonable opinion of such
separate counsel, a material conflict on any material issue between the position
of the Company and the position of such Indemnitee, in which case the Company
shall be responsible for the reasonable fees and expenses of no more than one
such separate counsel.
 
 
 
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10.           EVENTS OF DEFAULT.
 
An "Event of Default" shall be deemed to have occurred at any time as any of the
following events occurs:
 
(a)           the effectiveness of a registration statement registering the
resale of the Securities lapses for any reason (including, without limitation,
the issuance of a stop order or similar order) or such registration statement
(or the prospectus forming a part thereof) is unavailable to the Investor for
resale of any or all of the Securities to be issued to the Investor under the
Transaction Documents, and such lapse or unavailability continues for a period
of ten (10) consecutive Business Days or for more than an aggregate of thirty
(30) Business Days in any 365-day period, but excluding a lapse or
unavailability where (i) the Company terminates a registration statement after
the Investor has confirmed in writing that all of the Securities covered thereby
have been resold or (ii) the Company supersedes one registration statement with
another registration statement, including (without limitation) by terminating a
prior registration statement when it is effectively replaced with a new
registration statement covering Securities (provided in the case of this clause
(ii) that all of the Securities covered by the superseded (or terminated)
registration statement that have not theretofore been resold are included in the
superseding (or new) registration statement);
 
(b)           the suspension of the Common Stock from trading on the Principal
Market for a period of one (1) Business Day, provided that the Company may not
direct the Investor to purchase any shares of Common Stock during any such
suspension;
 
(c)           the delisting of the Common Stock from The Nasdaq Capital Market,
provided, however, that the Common Stock is not immediately thereafter trading
on the New York Stock Exchange, The Nasdaq Global Market, The Nasdaq Global
Select Market, the NYSE American, the NYSE Arca, the OTC Bulletin Board, the
OTCQX operated by the OTC Markets Group, Inc. or the OTCQB operated by the OTC
Markets Group, Inc. (or nationally recognized successor to any of the
foregoing);
 
(d) If at any time after the Commencement Date, the Exchange Cap is exceeded
unless and until stockholder approval is obtained pursuant to Section ‎2‎(e)
hereof. The Exchange Cap shall be deemed to be exceeded at such time if, upon
submission of a Regular Purchase Notice or Accelerated Purchase Notice under
this Agreement, the issuance of such shares of Common Stock would exceed that
number of shares of Common Stock which the Company may issue under this
Agreement without breaching the Company’s obligations under the rules or
regulations of the Principal Market;
 
(e)           the failure for any reason by the Transfer Agent to issue Purchase
Shares to the Investor within three (3) Business Days after the applicable
Purchase Date, Accelerated Purchase Date or Additional Accelerated Purchase Date
(as applicable) on which the Investor is entitled to receive such Purchase
Shares;
 
(f)           the Company breaches any representation, warranty, covenant or
other term or condition under any Transaction Document if such breach has or
could have a Material Adverse Effect and except, in the case of a breach of a
covenant which is reasonably curable, only if such breach continues for a period
of at least five (5) Business Days;
 
(g)           if any Person commences a proceeding against the Company pursuant
to or within the meaning of any Bankruptcy Law;
 
(h)           if, pursuant to or within the meaning of any Bankruptcy Law, the
Company (i) commences a voluntary case, (ii) consents to the entry of an order
for relief against it in an involuntary case, (iii) consents to the appointment
of a Custodian of it or for all or substantially all of its property, or (iv)
makes a general assignment for the benefit of its creditors or is generally
unable to pay its debts as the same become due;
 
(i)           a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that (i) is for relief against the Company in an involuntary
case, (ii) appoints a Custodian of the Company or for all or substantially all
of its property, or (iii) orders the liquidation of the Company or any
Subsidiary or;
 
(j)           if at any time the Company is not eligible to transfer its Common
Stock electronically as DWAC Shares.
 
 
 
-25-

 
 
In addition to any other rights and remedies under applicable law and this
Agreement, so long as an Event of Default has occurred and is continuing, or if
any event which, after notice and/or lapse of time, would become an Event of
Default, has occurred and is continuing, the Company shall not deliver to the
Investor any Regular Purchase Notice or Accelerated Purchase Notice.
Notwithstanding the foregoing, the foregoing sentence shall not be deemed to
apply to any notice from Nasdaq previously received or received in the future
regarding the Company’s failure to comply with the continuing listing standards
of The Nasdaq Capital Market, and to the fact of each such failure, unless and
until all compliance and appeal periods for such failure have lapsed or expired.
 
11.           TERMINATION
 
This Agreement may be terminated only as follows:
 
(a) If pursuant to or within the meaning of any Bankruptcy Law, the Company
commences a voluntary case or any Person commences a proceeding against the
Company, a Custodian is appointed for the Company or for all or substantially
all of its property, or the Company makes a general assignment for the benefit
of its creditors (any of which would be an Event of Default as described in
Sections 10(g), 10(h) and 10(i) hereof), this Agreement shall automatically
terminate without any liability or payment to the Company (except as set forth
below) without further action or notice by any Person.
 
(b) In the event that the Commencement shall not have occurred on or before June
30, 2020, due to the failure to satisfy the conditions set forth in Sections 7
and 8 above with respect to the Commencement, either the Company or the Investor
shall have the option to terminate this Agreement at the close of business on
such date or thereafter without liability of any party to any other party
(except as set forth below); provided, however, that the right to terminate this
Agreement under this Section 11(b) shall not be available to any party if such
party is then in breach of any covenant or agreement contained in this Agreement
or any representation or warranty of such party contained in this Agreement
fails to be true and correct such that the conditions set forth in Section 7(d)
or Section 8(e), as applicable, could not then be satisfied.
 
(c) At any time after the Commencement Date, the Company shall have the option
to terminate this Agreement for any reason or for no reason by delivering notice
(a “Company Termination Notice”) to the Investor electing to terminate this
Agreement without any liability whatsoever of any party to any other party under
this Agreement (except as set forth below). The Company Termination Notice shall
not be effective until one (1) Business Day after it has been received by the
Investor.
 
(d)           This Agreement shall automatically terminate on the date that the
Company sells and the Investor purchases the full Available Amount as provided
herein, without any action or notice on the part of any party and without any
liability whatsoever of any party to any other party under this Agreement
(except as set forth below).
 
(e)           If, for any reason or for no reason, the full Available Amount has
not been purchased in accordance with Section 2 of this Agreement by the
Maturity Date, this Agreement shall automatically terminate on the Maturity
Date, without any action or notice on the part of any party and without any
liability whatsoever of any party to any other party under this Agreement
(except as set forth below).
 
Except as set forth in Sections 11(a) (with respect to an Event of Default under
Sections 10(g), 10(h) and 10(i)), 11(d) and 11(e), any termination of this
Agreement pursuant to this Section 11 shall be effected by written notice from
the Company to the Investor, or the Investor to the Company, as the case may be,
setting forth the basis for the termination hereof. The representations and
warranties and covenants of the Company and the Investor contained in Sections
3, 4, 5, and 6 hereof, the indemnification provisions set forth in Section 9
hereof and the agreements and covenants set forth in Sections 10, 11 and 12
shall survive the Commencement and any termination of this Agreement. No
termination of this Agreement shall (i) affect the Company’s or the Investor’s
rights or obligations under (A) this Agreement with respect to pending Regular
Purchases, Accelerated Purchases, and Additional Accelerated Purchases and the
Company and the Investor shall complete their respective obligations with
respect to any pending Regular Purchases, Accelerated Purchases and Additional
Accelerated Purchases under this Agreement and (B) the Registration Rights
Agreement, which shall survive any such termination, or (ii) be deemed to
release the Company or the Investor from any liability for intentional
misrepresentation or willful breach of any of the Transaction Documents.
 
 
 
-26-

 
 
12.           MISCELLANEOUS.
 
(a)           Governing Law; Jurisdiction; Jury Trial. The corporate laws of the
State of Nevada shall govern all issues concerning the relative rights of the
Company and its stockholders. All other questions concerning the construction,
validity, enforcement and interpretation of this Agreement and the other
Transaction Documents shall be governed by the internal laws of the State of
Illinois, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the
State of Illinois. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the State of Illinois,
County of Cook, for the adjudication of any dispute hereunder or under the other
Transaction Documents or in connection herewith or therewith, or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT
OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
 
(b)           Counterparts. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party; provided that a facsimile signature or
signature delivered by e-mail in a “.pdf” format data file shall be considered
due execution and shall be binding upon the signatory thereto with the same
force and effect as if the signature were an original signature.
 
(c)           Headings. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.
 
(d)           Severability. If any provision of this Agreement shall be invalid
or unenforceable in any jurisdiction, such invalidity or unenforceability shall
not affect the validity or enforceability of the remainder of this Agreement in
that jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.
 
(e)           Entire Agreement. The Transaction Documents supersede all other
prior oral or written agreements between the Investor, the Company, their
affiliates and Persons acting on their behalf with respect to the subject matter
thereof, and this Agreement, the other Transaction Documents and the instruments
referenced herein contain the entire understanding of the parties with respect
to the matters covered herein and therein and, except as specifically set forth
herein or therein, neither the Company nor the Investor makes any
representation, warranty, covenant or undertaking with respect to such matters.
The Company acknowledges and agrees that has not relied on, in any manner
whatsoever, any representations or statements, written or oral, other than as
expressly set forth in the Transaction Documents.
 
 
 
-27-

 
 
(f)           Notices. Any notices, consents or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered: (i) upon receipt when delivered
personally; (ii) upon receipt when sent by facsimile or email (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one Business Day after deposit with
a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses for such
communications shall be:
 
If to the Company:
 
VistaGen Therapeutics, Inc.
343 Allerton Avenue
South San Francisco, CA 94080
Telephone: (650) 577-3600
Attention: Shawn Singh, Chief Executive Officer
E-Mail: ssingh@vistagen.com
 
With a copy to (which shall not constitute notice or service of process):
 
Disclosure Law Group, a Professional Corporation
655 West Broadway, Suite 870
San Diego, CA 92101
Telephone:  

619.272.7063
Facsimile: 619.330.2101
E-mail:  

jsudweeks@disclosurelawgroup.com
Attention:  

Jessica R. Sudweeks
 
If to the Investor:
 
Lincoln Park Capital Fund, LLC
440 North Wells, Suite 410
Chicago, IL 60654
Telephone:                       
312-822-9300
Facsimile:                       
312-822-9301
E-mail:                                 
jscheinfeld@lpcfunds.com or jcope@lpcfunds.com
Attention:                       
Josh Scheinfeld or Jonathan Cope
 
With a copy to (which shall not constitute notice or service of process):
 
K&L Gates, LLP
200 S. Biscayne Blvd., Ste. 3900
Miami, Florida 33131
Telephone:  305-539-3306
Facsimile:  305-358-7095
E-mail: clayton.parker@klgates.com
Attention:  Clayton E. Parker, Esq.
 
If to the Transfer Agent:
 
Computershare Trust Company, N.A.
8742 Lucent Blvd., Suite 225
Highlands Ranch, CO 80129
Telephone: 303-262-0637
Facsimile: 303-262-0609
Attention: Audrey Matheney
E-Mail: audrey.matheny@computershare.com
 
 
 
-28-

 
 
or at such other address and/or facsimile number and/or email address and/or to
the attention of such other Person as the recipient party has specified by
written notice given to each other party three (3) Business Days prior to the
effectiveness of such change. Written confirmation of (A) receipt given by the
recipient of such notice, consent or other communication, (B) delivery
mechanically or electronically generated by the sender's facsimile machine or
email account containing the time, date, and recipient facsimile number or email
address, as applicable and an image of the first page of such transmission, or
(C) delivery provided by a nationally recognized overnight delivery service,
shall be rebuttable evidence of personal service, receipt by facsimile or email
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.
 
(g)           Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns.
The Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of the Investor, including by merger
or consolidation. The Investor may not assign its rights or obligations under
this Agreement.
 
(h)           No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and, except as set forth in Section 9, is not for the benefit of, nor
may any provision hereof be enforced by, any other Person.
 
(i)           Publicity. The Company shall afford the Investor and its counsel
with the opportunity to review and comment upon, shall consult with the Investor
and its counsel on the form and substance of, and shall give due consideration
to all such comments from the Investor or its counsel on, any press release, SEC
filing or any other public disclosure by or on behalf of the Company relating to
the Investor, its purchases hereunder or any aspect of the Transaction Documents
or the transactions contemplated thereby, not less than 24 hours prior to the
issuance, filing or public disclosure thereof. Unless the parties agree
otherwise, which agreement may be oral or electronic, the Investor must be
provided with a final version of any such press release, SEC filing or other
public disclosure at least 24 hours prior to any release, filing or use by the
Company thereof.
 
(j)           Further Assurances. Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to consummate and make
effective, as soon as reasonably possible, the Commencement, and to carry out
the intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.
 
(k)           No Financial Advisor, Placement Agent, Broker or Finder. The
Company represents and warrants to the Investor that it has not engaged any
financial advisor, placement agent, broker or finder in connection with the
transactions contemplated hereby. The Investor represents and warrants to the
Company that it has not engaged any financial advisor, placement agent, broker
or finder in connection with the transactions contemplated hereby. The Company
shall be responsible for the payment of any fees or commissions, if any, of any
financial advisor, placement agent, broker or finder relating to or arising out
of the transactions contemplated hereby. The Company shall pay, and hold the
Investor harmless against, any liability, loss or expense (including, without
limitation, attorneys' fees and out of pocket expenses) arising in connection
with any such claim.
 
(l)           No Strict Construction. The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.
 
(m)           Remedies, Other Obligations, Breaches and Injunctive Relief. The
Investor’s remedies provided in this Agreement, including, without limitation,
the Investor’s remedies provided in Section 9, shall be cumulative and in
addition to all other remedies available to the Investor under this Agreement,
at law or in equity (including a decree of specific performance and/or other
injunctive relief), no remedy of the Investor contained herein shall be deemed a
waiver of compliance with the provisions giving rise to such remedy and nothing
herein shall limit the Investor’s right to pursue actual damages for any failure
by the Company to comply with the terms of this Agreement. The Company
acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Investor and that the remedy at law for any such breach
may be inadequate. The Company therefore agrees that, in the event of any such
breach, the Investor shall be entitled, in addition to all other available
remedies, to an injunction restraining any breach, without the necessity of
showing economic loss and without any bond or other security being required.
 
 
 
 
-29-

 
 
(n)             Enforcement Costs. If: (i) this Agreement is placed by the
Investor in the hands of an attorney for enforcement or is enforced by the
Investor through any legal proceeding; (ii) an attorney is retained to represent
the Investor in any bankruptcy, reorganization, receivership or other
proceedings affecting creditors’ rights and involving a claim under this
Agreement; or (iii) an attorney is retained to represent the Investor in any
other proceedings whatsoever in connection with this Agreement, then the Company
shall pay to the Investor, as incurred by the Investor, all reasonable costs and
expenses including reasonable attorneys’ fees incurred in connection therewith,
in addition to all other amounts due hereunder.
 
(o)            Amendment and Waiver; Failure or Indulgence Not Waiver. No
provision of this Agreement may be amended or waived by the parties from and
after the date that is one (1) Business Day immediately preceding the filing of
the Registration Statement with the SEC. Subject to the immediately preceding
sentence, (i) no provision of this Agreement may be amended other than by a
written instrument signed by both parties hereto and (ii) no provision of this
Agreement may be waived other than in a written instrument signed by the party
against whom enforcement of such waiver is sought. No failure or delay in the
exercise of any power, right or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such power, right or
privilege preclude other or further exercise thereof or of any other right,
power or privilege.
 
 
** Signature Page Follows **
 
 
 
-30-

 
 
IN WITNESS WHEREOF, the Investor and the Company have caused this Purchase
Agreement to be duly executed as of the date first written above.
 
 
 
THE COMPANY:
 
VISTAGEN THERAPEUTICS, INC.
 

By: /s/ Shawn Singh
Name: Shawn Singh
Title: Chief Executive Officer
 
 
 
INVESTOR:
 
LINCOLN PARK CAPITAL FUND, LLC
 
BY: LINCOLN PARK CAPITAL, LLC

By: /s/ Josh Scheinfeld
Name: Josh Scheinfeld
Title: President
 
 
 
 
-31-

 

 
SCHEDULES
 
Schedule 4(c)                                 
Capitalization
Schedule 4(w)                                 
Brokerage or Finder’s Fees
 
 
 
-32-

 
 
EXHIBITS
 
Exhibit A 
Form of Officer’s Certificate
Exhibit B 
Form of Secretary’s Certificate
Exhibit C 
Form of Letter to Transfer Agent
 
 
 
-33-

 
 
DISCLOSURE SCHEDULES
 
 
 
 
 
 
 
 
-34-

 
EXHIBIT A
 
FORM OF OFFICER’S CERTIFICATE
 
This Officer’s Certificate (“Certificate”) is being delivered pursuant to
Section 8(e) of that certain Purchase Agreement dated as of March 24, 2020,
(“Purchase Agreement”), by and between VISTAGEN THERAPEUTICS, INC., a Nevada
corporation (the “Company”), and LINCOLN PARK CAPITAL FUND, LLC (the
“Investor”). Terms used herein and not otherwise defined shall have the meanings
ascribed to them in the Purchase Agreement.
 
The undersigned, ___________, ______________ of the Company, hereby certifies as
follows:
 
1.           I am the _____________ of the Company and make the statements
contained in this Certificate;
 
2.           The representations and warranties of the Company are true and
correct in all material respects (except to the extent that any of such
representations and warranties is already qualified as to materiality in Section
4 of the Purchase Agreement, in which case, such representations and warranties
are true and correct without further qualification) as of the date when made and
as of the Commencement Date as though made at that time (except for
representations and warranties that speak as of a specific date, in which case
such representations and warranties are true and correct in all as of such
date);
 
3.           The Company has performed, satisfied and complied in all material
respects with covenants, agreements and conditions required by the Transaction
Documents to be performed, satisfied or complied with by the Company at or prior
to the Commencement Date.
 
4.            The Company has not taken any steps, and does not currently expect
to take any steps, to seek protection pursuant to any Bankruptcy Law nor does
the Company or any of its Subsidiaries have any knowledge or reason to believe
that its creditors intend to initiate involuntary bankruptcy or insolvency
proceedings.
 
IN WITNESS WHEREOF, I have hereunder signed my name on this ___ day of
___________.
 
      ______________________
Name:
Title:
 
The undersigned as Secretary of VISTAGEN THERAPEUTICS, INC., a Nevada
corporation, hereby certifies that ___________ is the duly elected, appointed,
qualified and acting ________ of VISTAGEN THERAPEUTICS, INC. and that the
signature appearing above is her/her genuine signature.
 
___________________________________
                                                                                                
Secretary
 

 
-35-

 
 
 
EXHIBIT B
 
FORM OF SECRETARY’S CERTIFICATE
 
This Secretary’s Certificate (“Certificate”) is being delivered pursuant to
Section 8(k) of that certain Purchase Agreement dated as of March 24, 2020
(“Purchase Agreement”), by and between VISTAGEN THERAPEUTICS, INC., a Nevada
corporation (the “Company”) and LINCOLN PARK CAPITAL FUND, LLC (the “Investor”),
pursuant to which the Company may sell to the Investor up to Ten Million Two
Hundred Fifty Thousand Dollars ($10,250,000) of the Company’s common stock.
Terms used herein and not otherwise defined shall have the meanings ascribed to
them in the Purchase Agreement.
 
The undersigned, ____________, Secretary of the Company, hereby certifies as
follows:
 
1.           I am the Secretary of the Company and make the statements contained
in this Secretary’s Certificate.
 
2.           Attached hereto as Exhibit A and Exhibit B are true, correct and
complete copies of the Company’s Bylaws (“Bylaws”) and Articles of Incorporation
(“Charter”), in each case, as amended through the date hereof, and no action has
been taken by the Company, its directors, officers or stockholders, in
contemplation of the filing of any further amendment relating to or affecting
the Bylaws or Charter.
 
3.           Attached hereto as Exhibit C are true, correct and complete copies
of the resolutions duly adopted by the Board of Directors of the Company on
_____________, at which a quorum was present and acting throughout. Such
resolutions have not been amended, modified or rescinded and remain in full
force and effect and such resolutions are the only resolutions adopted by the
Company’s Board of Directors, or any committee thereof, or the stockholders of
the Company relating to or affecting (i) the entering into and performance of
the Purchase Agreement, or the issuance, offering and sale of the Purchase
Shares and the Commitment Shares and (ii) and the performance of the Company of
its obligation under the Transaction Documents as contemplated therein.
 
4.           As of the date hereof, the authorized, issued and reserved capital
stock of the Company is as set forth on Exhibit D hereto.
 
IN WITNESS WHEREOF, I have hereunder signed my name on this ___ day of
____________, 2020.
 
                                                                        _________________________
[NAME] Secretary
 
 
The undersigned as ______________ of VISTAGEN THERAPEUTICS, INC., a Nevada
corporation, hereby certifies that __________________ is the duly elected,
appointed, qualified and acting Secretary of VISTAGEN THERAPEUTICS, INC., and
that the signature appearing above is his/her genuine signature.
 
                                                                       ___________________________________
[NAME]
[TITLE]
 
 
-36-

 
 
EXHIBIT C
 
FORM OF LETTER TO THE TRANSFER AGENT FOR THE ISSUANCE OF THE COMMITMENT SHARES
AT SIGNING OF THE PURCHASE AGREEMENT
 
 
 
[COMPANY LETTERHEAD]
 
 
 
March 24, 2020
 
 
Computershare Trust Company, N.A.
8742 Lucent Blvd., Suite 225
Highlands Ranch, CO 80129
Telephone: 303-262-0637
Facsimile: 303-262-0609
Attention: Audrey Matheney
E-Mail: audrey.matheny@computershare.com
 
Re: Issuance of Common Stock to Lincoln Park Capital Fund, LLC
 
Dear Ms. Matheney:
 
On behalf of VISTAGEN THERAPEUTICS, INC. (the “Company”), you are hereby
instructed to issue as soon as possible a book-entry statement representing an
aggregate of 1,250,000 shares of our common stock in the name of Lincoln Park
Capital Fund, LLC. The book-entry statement should be dated March 24, 2020. I
have included a true and correct copy of resolutions duly adopted by the
Company’s Board of Directors approving the issuance of these shares. The
book-entry statement should bear the following restrictive legend:
 
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL, IN A
CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE
STATE SECURITIES LAWS.
 
The book-entry statement should be sent as soon as possible via overnight mail
to the following address:
 
Lincoln Park Capital Fund, LLC
440 North Wells, Suite 410
Chicago, IL 60654
Attention: Josh Scheinfeld/Jonathan Cope
 
Thank you very much for your help. Please call me at [__________] if you have
any questions or need anything further.
 
VISTAGEN THERAPEUTICS, INC.
 
 
By:_____________________________
Name:
Title:
 

 
 
 
-37-