Document:

atax-ex101_33.htm

 

Exhibit 10.1

America First Multifamily Investors, L.P.

Beneficial Unit Certificates Representing Assigned Limited Partnership Interests

Capital on DemandTM Sales Agreement

JonesTrading Institutional Services LLC

757 3rd Avenue, 23rd Floor

New York, NY 10017

December 7, 2017

Ladies and Gentlemen:

AMERICA FIRST MULTIFAMILY INVESTORS, L.P. a Delaware limited partnership (the “Partnership”), confirms its agreement (this “Agreement”) with JONESTRADING INSTITUTIONAL SERVICES LLC (the “Agent”), as follows:

 

1.Issuance and Sale of BUCs. The Partnership agrees that, from time to time during the term of this Agreement, on the terms and subject to the conditions set forth herein, it may issue and sell through the Agent, beneficial unit certificates (the “Placement Units”) representing assigned limited partnership interests of the Partnership (“BUCs”), having an aggregate offering price of up to $75,000,000; provided that, in no event shall the Partnership issue or sell through the Agent such number of Placement Units that (A) exceeds the number or dollar amount of BUCs that may be sold pursuant to the Registration Statement and (B) is authorized from time to time to be issued and sold under this Agreement by the board of managers of the general partner of the general partner of the Partnership (the “Board”), a duly authorized committee thereof or a duly authorized executive committee (the “Maximum Amount”). Notwithstanding anything to the contrary contained herein, the parties hereto agree that compliance with the limitations set forth in this Section 1 on the amount of Placement Units issued and sold under this Agreement shall be the sole responsibility of the Partnership and that Agent shall have no obligation in connection with such compliance. The issuance and sale of Placement Units through Agent will be effected pursuant to the Registration Statement (as defined below) filed by the Partnership and declared effective by the Securities and Exchange Commission (the “Commission”), although nothing in this Agreement shall be construed as requiring the Partnership to use the Registration Statement to issue any Placement Units.

The Partnership has filed, in accordance with the provisions of the Securities Act of 1933, as amended (the “Securities Act”) and the rules and regulations thereunder (the “Securities Act Regulations”), with the Commission a registration statement on Form S-3 (File No. 333-214656), including a base prospectus, relating to certain securities, including the Placement Units to be issued from time to time by the Partnership, and which incorporates by reference documents that the Partnership has filed or will file in accordance with the provisions of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations thereunder (the “Exchange Act Regulations”). The Partnership has prepared a prospectus supplement specifically 

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relating to the Placement Units (the “Prospectus Supplement”) to the base prospectus included as part of such registration statement. The Partnership will furnish to the Agent, for use by the Agent, copies of the prospectus included as part of such registration statement, as supplemented by the Prospectus Supplement, relating to the Placement Units. Except where the context otherwise requires, such registration statement, and any post-effective amendment thereto, including all documents filed as part thereof or incorporated by reference therein, and including any information contained in a Prospectus (as defined below) subsequently filed with the Commission pursuant to Rule 424(b) under the Securities Act Regulations or deemed to be a part of such registration statement pursuant to Rule 430B of the Securities Act Regulations, is herein called the “Registration Statement.” The base prospectus, including all documents incorporated therein by reference, included in the Registration Statement, as it may be supplemented by the Prospectus Supplement, in the form in which such prospectus and/or Prospectus Supplement have most recently been filed by the Partnership with the Commission pursuant to Rule 424(b) under the Securities Act Regulations, together with any then issued Issuer Free Writing Prospectus (defined below), is herein called the “Prospectus.” Any reference herein to the Registration Statement, the Prospectus or any amendment or supplement thereto, shall be deemed to refer to and include the documents incorporated or deemed to be incorporated by reference therein, and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement or the Prospectus shall be deemed to refer to and include the filing after the execution hereof of any document with the Commission deemed to be incorporated by reference therein (the “Incorporated Documents”). For purposes of this Agreement, all references to the Registration Statement, the Prospectus or to any amendment or supplement thereto shall be deemed to include any copy filed with the Commission pursuant to its Electronic Data Gathering Analysis and Retrieval System, or if applicable, the Interactive Data Electronic Application system when used by the Commission (collectively, “EDGAR”).

2.Placements. Each time that the Partnership wishes to issue and sell Placement Units hereunder (each, a “Placement”), it will notify the Agent by email notice (or other method mutually agreed to in writing by the Parties) of the number of Placement Units, the time period during which sales are requested to be made, any limitation on the number of Placement Units that may be sold in any one day and any minimum price below which sales may not be made (a “Placement Notice”), the form of which is attached hereto as Schedule 1. The Placement Notice shall originate from any of the individuals from the Partnership set forth on Schedule 3 (with a copy to each of the other individuals from the Partnership listed on such schedule), and shall be addressed to each of the individuals from the Agent set forth on Schedule 3, as such Schedule 3 may be amended from time to time. The Placement Notice shall be effective unless and until (i) the Agent declines to accept the terms contained therein for any reason, in its sole discretion, (ii) the entire amount of the Placement Units thereunder have been sold, (iii) the Partnership suspends or terminates the Placement Notice for any reason, in its sole discretion, or (iv) the Agreement has been terminated under the provisions of Section 12.  The amount of any discount, commission or other compensation to be paid by the Partnership to Agent in connection with the sale of the Placement Units shall be calculated in accordance with the terms set forth in Schedule 2. It is expressly acknowledged and agreed that neither the Partnership nor the Agent will have any obligation whatsoever with respect to a Placement or any Placement Units unless and until the Partnership delivers a Placement Notice to the Agent and the Agent does not decline such Placement Notice pursuant to the terms set forth above, and then only upon the terms specified 

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therein and herein. In the event of a conflict between the terms of this Agreement and the terms of a Placement Notice, the terms of the Placement Notice will control.

3.Sale of Placement Units by Agent. Subject to the provisions of Section 5(a), the Agent, for the period specified in the Placement Notice, will use its commercially reasonable efforts consistent with its normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of the NASDAQ Stock Market LLC (the “Exchange”), to sell the Placement Units up to the amount specified, and otherwise in accordance with the terms of such Placement Notice. The Agent will provide written confirmation to the Partnership no later than the opening of the Trading Day (as defined below) immediately following the Trading Day on which it has made sales of Placement Units hereunder setting forth the number of Placement Units sold on such day, the compensation payable by the Partnership to the Agent pursuant to Section 2 with respect to such sales, and the Net Proceeds (as defined below) payable to the Partnership, with an itemization of the deductions made by the Agent (as set forth in Section 5(b)) from the gross proceeds that it receives from such sales. Subject to the terms of the Placement Notice, the Agent may sell Placement Units by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) of the Securities Act Regulations. Subject to the terms of a Placement Notice, the Agent may also sell Placement Units by any other method permitted by law and the rules and regulations of the Exchange, including but not limited to negotiated transactions, with the Partnership’s prior written consent. During the term of this Agreement, neither the Agent nor any of its affiliates or subsidiaries shall engage in (i) any short sale of any security of the Partnership or (ii) any sale of any security of the Partnership that the Agent does not own or any sale which is consummated by the delivery of a security of the Partnership borrowed by, or for the account of, the Agent. Neither the Agent nor any of its affiliates or subsidiaries shall engage in any proprietary trading or trading for the Agent’s (or its affiliates’ or subsidiaries’) own account.  Notwithstanding anything to the contrary, nothing in this Agreement shall limit the Agent’s ability or capacity to trade any security of Partnership, including short sales, in any transaction relating to bona fide errors or special settlements.

4.Suspension of Sales. The Partnership or the Agent may, upon notice to the other party in writing (including by email correspondence to each of the individuals of the other party set forth on Schedule 3, if receipt of such correspondence is actually acknowledged by any of the individuals to whom the notice is sent, other than via auto-reply) or by telephone (confirmed immediately by verifiable facsimile transmission or email correspondence to each of the individuals of the other party set forth on Schedule 3), suspend any sale of Placement Units; provided, however, that such suspension shall not affect or impair any party’s obligations with respect to any Placement Units sold hereunder prior to the receipt of such notice. Each party agrees that no such notice under this Section 4 shall be effective against any other party unless it is made to one of the individuals named on Schedule 3 hereto, as such Schedule may be amended from time to time.

5.Sale and Delivery to the Agent; Settlement.

(a)Sale of Placement Units. On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, upon the Agent’s acceptance of the terms of a Placement Notice, and unless the sale of the Placement Units described therein has been declined, suspended, or otherwise terminated in accordance with the 

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terms of this Agreement, the Agent, for the period specified in the Placement Notice, will use its commercially reasonable efforts consistent with its normal trading and sales practices to sell such Placement Units up to the amount specified in such Placement Notice, and otherwise in accordance with the terms of such Placement Notice. The Partnership acknowledges and agrees that (i) there can be no assurance that the Agent will be successful in selling Placement Units, (ii) the Agent will incur no liability or obligation to the Partnership or any other person or entity if it does not sell Placement Units for any reason other than a failure by the Agent to use its commercially reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations to sell such Placement Units as required under this Agreement and (iii) the Agent shall be under no obligation to purchase Placement Units on a principal basis pursuant to this Agreement, except as otherwise agreed by the Agent and the Partnership.

(b)Settlement of Placement Units. Unless otherwise specified in the applicable Placement Notice, settlement for sales of Placement Units will occur on the second (2nd) Trading Day (or such earlier day as is industry practice for regular-way trading) following the date on which such sales are made (each, a “Settlement Date”). The amount of proceeds to be delivered to the Partnership on a Settlement Date against receipt of the Placement Units sold (the “Net Proceeds”) will be equal to the aggregate sales price received by the Agent, after deduction for (i) the Agent’s commission, discount or other compensation for such sales payable by the Partnership pursuant to Section 2 hereof, and (ii) any transaction fees imposed by any governmental or self-regulatory organization in respect of such sales.

(c)Delivery of Placement Units. On each Settlement Date, against payment of the Net Proceeds, the Partnership will, or will cause its transfer agent to, electronically transfer the Placement Units being sold by crediting the Agent’s or its designee’s account (provided the Agent shall have given the Partnership written notice of such designee prior to the Settlement Date) at The Depository Trust Partnership through its Deposit and Withdrawal at Custodian System or by such other means of delivery as may be mutually agreed upon by the parties hereto which in all cases shall be freely tradable, transferable, registered shares in good deliverable form. On each Settlement Date, the Agent will deliver the related Net Proceeds in same day funds to an account designated by the Partnership on, or prior to, the Settlement Date. The Partnership agrees that if the Partnership, or its transfer agent (if applicable), defaults in its obligation to deliver Placement Units on a Settlement Date through no fault of the Agent, the Partnership agrees that in addition to and in no way limiting the rights and obligations set forth in Section 10(a) hereto, it will (i) hold the Agent harmless against any loss, claim, damage, or reasonable and documented expense (including reasonable and documented legal fees and expenses), as incurred, arising out of or in connection with such default by the Partnership or its transfer agent (if applicable) and (ii) pay to the Agent (without duplication) any commission, discount, or other compensation to which it would otherwise have been entitled absent such default.

(d)Limitations on Offering Size. Under no circumstances shall the Partnership cause or request the offer or sale of any Placement Units if, after giving effect to the sale of such Placement Units, the aggregate number or gross sales proceeds of Placement Units sold pursuant to this Agreement would exceed the Maximum Amount. Under no circumstances shall the Partnership cause or request the offer or sale of any Placement Units pursuant to this Agreement at a price lower than the minimum price authorized from time to time by the Partnership’s Board, a duly authorized committee thereof or a duly authorized executive committee, and notified to the 

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Agent in writing. Further, under no circumstances shall the Partnership cause or permit the aggregate offering amount of Placement Units sold pursuant to this Agreement to exceed the Maximum Amount.

6.Representations and Warranties of the Partnership. Except as disclosed in the Registration Statement or Prospectus (including the Incorporated Documents), the Partnership represents and warrants to, and agrees with the Agent that as of the date of this Agreement and as of each Applicable Time (as defined below), unless such representation, warranty or agreement specifies a different date or time:

(a)Registration Statement and Prospectus. The Partnership and the transactions contemplated by this Agreement meet the requirements for and comply with the conditions for the use of Form S-3 under the Securities Act. The Registration Statement has been filed with the Commission and declared effective under the Securities Act. The Prospectus Supplement will name the Agent as underwriter, acting as agent, in the section entitled “Plan of Distribution.” The Partnership has not received, and has no notice of, any order of the Commission preventing or suspending the use of the Registration Statement, or threatening or instituting proceedings for that purpose. The Registration Statement and the offer and sale of Placement Units as contemplated hereby meet the requirements of Rule 415 under the Securities Act and comply in all material respects with said Rule. Any statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement have been or will be so described or filed. Copies of the Registration Statement, the Prospectus, and any such amendments or supplements and all documents incorporated by reference therein that were filed with the Commission on or prior to the date of this Agreement have been delivered, or are available through EDGAR, to Agent and its counsel. The Partnership has not distributed and, prior to the later to occur of each Settlement Date and completion of the distribution of the Placement Units, will not distribute any offering material in connection with the offering or sale of the Placement Units other than the Registration Statement and the Prospectus and any Issuer Free Writing Prospectus to which Agent has consented. The BUCs are currently quoted on the Exchange under the trading symbol “ATAX”. The Partnership has not, in the 12 months preceding the date hereof, received notice from the Exchange to the effect that the Partnership is not in compliance with the listing or maintenance requirements. The Partnership 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.

(b)No Misstatement or Omission. The Registration Statement, when it became or becomes effective, and the Prospectus, and any amendment or supplement thereto, on the date of such Prospectus or amendment or supplement, conformed and will conform in all material respects with the requirements of the Securities Act. At each Settlement Date, the Registration Statement and the Prospectus, as of such date, will conform in all material respects with the requirements of the Securities Act. The Registration Statement, when it became or becomes effective, did not, and will not, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Prospectus and any amendment or supplement thereto, on the date thereof and at each Applicable Time (defined below), did not and will not include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The Incorporated Documents did not, 

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and any further documents filed and incorporated by reference therein will not, when filed with the Commission, contain an untrue statement of a material fact or omit to state a material fact required to be stated in such document or necessary to make the statements in such document, in light of the circumstances under which they were made, not misleading. The foregoing shall not apply to statements in, or omissions from, any such document made in reliance upon, and in conformity with, information furnished to the Partnership by Agent specifically for use in the preparation thereof.

(c)Conformity with Securities Act and Exchange Act. The Registration Statement, the Prospectus, any Issuer Free Writing Prospectus or any amendment or supplement thereto, and the Incorporated Documents, when such documents were or are filed with the Commission under the Securities Act or the Exchange Act or became or become effective under the Securities Act, as the case may be, conformed and will conform in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable.

(d)Financial Information. The financial statements of the Partnership included or incorporated by reference in the Registration Statement, the Prospectus and the Issuer Free Writing Prospectuses, if any, together with the related notes and schedules, present fairly, in all material respects, the financial position of the Partnership as of the dates indicated and the results of operations, cash flows and changes in stockholders’ equity of the Partnership for the periods specified and have been prepared in compliance with the requirements of the Securities Act and Exchange Act and in conformity with GAAP (as defined below) applied on a consistent basis (except for (i) such adjustments to accounting standards and practices as are noted therein, (ii) in the case of unaudited interim financial statements, to the extent such financial statements may not include footnotes required by GAAP or may be condensed or summary statements and (iii) such adjustments which will not be material, either individually or in the aggregate) during the periods involved; the other financial and statistical data with respect to the Partnership contained or incorporated by reference in the Registration Statement, the Prospectus and the Issuer Free Writing Prospectuses, if any, are accurately and fairly presented and prepared on a basis consistent with the financial statements and books and records of the Partnership; there are no financial statements (historical or pro forma) that are required to be included or incorporated by reference in the Registration Statement, or the Prospectus that are not included or incorporated by reference as required; the Partnership does not have any material liabilities or obligations, direct or contingent (including any off-balance sheet obligations), not described in the Registration Statement (excluding the exhibits thereto), and the Prospectus; and all disclosures contained or incorporated by reference in the Registration Statement, the Prospectus and the Issuer Free Writing Prospectuses, if any, regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations of the Commission) comply in all material respects with Regulation G of the Exchange Act and Item 10 of Regulation S-K under the Securities Act, to the extent applicable.

(e)Conformity with EDGAR Filing. The Prospectus delivered to the Agent for use in connection with the sale of the Placement Units pursuant to this Agreement will be identical to the versions of the Prospectus created to be transmitted to the Commission for filing via EDGAR, except to the extent permitted by Regulation S-T.

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(f)Organization. The Partnership is duly organized, validly existing as a limited partnership and in good standing under the laws of its jurisdiction of organization. The Partnership is duly licensed or qualified as a foreign limited partnership for transaction of business and in good standing under the laws of each other jurisdiction in which its ownership or lease of property or the conduct of its business requires such license or qualification, and has all limited partnership power and authority necessary to own or hold its properties and to conduct its business as described in the Registration Statement and the Prospectus, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a material adverse effect on or affecting the assets, business, operations, earnings, properties, condition (financial or otherwise), prospects, partners’ equity or results of operations of the Partnership or prevent or materially interfere with consummation of the transactions contemplated hereby (a “Material Adverse Effect”).

(g)Subsidiaries.  Except as set forth in the Prospectus and the Incorporated Documents, the Partnership does not own or control, directly or indirectly, any shares of capital stock and does not have any other equity or proprietary interest in any other corporation or any equity interest in any partnership, joint venture, association, trust, limited liability Partnership or other non-corporate business entity.

(h)No Violation or Default. The Partnership is not (i) in violation of its certificate of limited partnership or agreement of limited partnership or similar organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Partnership is a party or by which the Partnership is bound or to which any of the property or assets of the Partnership is subject; or (iii) in violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of each of clauses (ii) and (iii) above, for any such violation or default that would not, individually or in the aggregate, have a Material Adverse Effect. To the Partnership’s knowledge, no other party under any material contract or other agreement to which it is a party is in default in any respect thereunder where such default would have a Material Adverse Effect.

(i)No Material Adverse Effect. Subsequent to the latest date as of which information is given in the Registration Statement, the Prospectus and the Issuer Free Writing Prospectuses, if any, (including any document deemed incorporated by reference therein), there has not been (i) any Material Adverse Effect, (ii) any transaction which is material to the Partnership, (iii) any obligation or liability, direct or contingent (including any off-balance sheet obligations), incurred by the Partnership which is material to the Partnership, (iv) any material change in the BUCs or outstanding long-term indebtedness (other than (A) the grant of additional awards under equity incentive plans, (B) changes in the number of outstanding BUCs due to the issuance of BUCs upon the exercise or conversion of securities exercisable for or convertible into BUCs outstanding on the date hereof, (C) any repurchase of BUCs of the Partnership, (D) as a result of the sale of Placement Units, or (E) other than as publicly reported or announced), or (v) any dividend or distribution of any kind declared, paid or made on the BUCs of the Partnership other than in each case above in the ordinary course of business or as otherwise disclosed in the Registration Statement or Prospectus (including any document deemed incorporated by reference therein).

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(j)Capitalization. The issued and outstanding BUCs of the Partnership have been validly issued, are fully paid and nonassessable and, other than as disclosed in the Registration Statement or the Prospectus, are not subject to any preemptive rights, rights of first refusal or similar rights. The Partnership has an authorized, issued and outstanding capitalization as set forth in the Registration Statement and the Prospectus as of the dates referred to therein (other than the grant of additional options and restricted unit awards under the Partnership’s existing equity incentive plans, or changes in the number of outstanding BUCs of the Partnership due to the issuance of BUCs upon the exercise or conversion of securities exercisable for, or convertible into, BUCs outstanding on the date hereof) and such authorized BUCs conform to the description thereof set forth in the Registration Statement and the Prospectus. The description of the securities of the Partnership in the Registration Statement and the Prospectus is complete and accurate in all material respects. As of the date referred to therein, the Partnership does not have outstanding any options to purchase, or any rights or warrants to subscribe for, or any securities or obligations convertible into, or exchangeable for, or any contracts or commitments to issue or sell, any BUCs or other securities.

(k)Authorization; Enforceability. The Partnership has full legal right, power and authority to enter into this Agreement and perform the transactions contemplated hereby. This Agreement has been duly authorized, executed and delivered by the Partnership and is a legal, valid and binding agreement of the Partnership enforceable in accordance with its terms, except (i) to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general equitable principles and (ii) the indemnification and contribution provisions of Section 10 hereof may be limited by federal or state securities laws and public policy considered in respect thereof.

(l)Authorization of Placement Units. The Placement Units, when issued and delivered pursuant to the terms approved by the Board or a duly authorized committee thereof, against payment therefor as provided herein, will be duly and validly authorized and issued and fully paid and nonassessable, free and clear of any pledge, lien, encumbrance, security interest or other claim, including any statutory or contractual preemptive rights, resale rights, rights of first refusal or other similar rights, and will be registered pursuant to Section 12 of the Exchange Act. The Placement Units, when issued, will conform in all material respects to the description thereof set forth in or incorporated into the Prospectus.

(m)No Consents Required. No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or governmental or regulatory authority is required for the execution, delivery and performance by the Partnership of this Agreement, or the issuance and sale by the Partnership of the Placement Units, except for such consents, approvals, authorizations, orders and registrations or qualifications as may be required under applicable state securities laws or by the by-laws and rules of the Financial Industry Regulatory Authority (“FINRA”) or the Exchange in connection with the sale of the Placement Units by the Agent.

(n)No Preferential Rights. (i) No person, as such term is defined in Rule 1-02 of Regulation S-X promulgated under the Securities Act (each, a “Person”), has the right, contractual or otherwise, to cause the Partnership to issue or sell to such Person any BUCs or other securities of the Partnership, (ii) no Person has any preemptive rights, resale rights, rights of first 

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refusal, or any other rights (whether pursuant to a “poison pill” provision or otherwise) to purchase any BUCs or other securities of the Partnership, (iii) no Person has the right to act as an underwriter or as a financial advisor to the Partnership in connection with the offer and sale of BUCs, and (iv) no Person has the right, contractual or otherwise, to require the Partnership to register under the Securities Act any BUCs or other securities of the Partnership, or to include any such BUCs or other securities in the Registration Statement or the offering contemplated thereby, whether as a result of the filing or effectiveness of the Registration Statement or the sale of the Placement Units as contemplated thereby or otherwise.

(o)Independent Public Accountant.  PricewaterhouseCoopers LLP (the “Accountant”), whose report on the financial statements of the Partnership is filed with the Commission as part of the Partnership’s most recent Annual Report on Form 10-K filed with the Commission and incorporated by reference into the Registration Statement and the Prospectus, are and, during the periods covered by their report, were an independent registered public accounting firm with respect to the Partnership within the meaning of the Securities Act and the Public Partnership Accounting Oversight Board (United States). To the Partnership’s knowledge, the Accountant is not in violation of the auditor independence requirements of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) with respect to the Partnership.

(p)Enforceability of Agreements. All agreements between the Partnership and third parties expressly referenced in the Prospectus are legal, valid and binding obligations of the Partnership enforceable in accordance with their respective terms, except to the extent that (i) enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general equitable principles and (ii) the indemnification provisions of certain agreements may be limited be federal or state securities laws or public policy considerations in respect thereof, and except for any unenforceability that, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

(q)No Litigation. There are no legal, governmental or regulatory actions, suits or proceedings pending, nor, to the Partnership’s knowledge, any legal, governmental or regulatory investigations, to which the Partnership is a party or to which any property of the Partnership is the subject that, individually or in the aggregate, if determined adversely to the Partnership would have a Material Adverse Effect or materially and adversely affect the ability of the Partnership to perform its obligations under this Agreement; to the Partnership’s knowledge, no such actions, suits or proceedings are threatened or contemplated by any governmental or regulatory authority or threatened by others; and (i) there are no current or pending legal, governmental or regulatory investigations, actions, suits or proceedings that are required under the Securities Act to be described in the Prospectus that are not so described; and (ii) there are no contracts or other documents that are required under the Securities Act to be filed as exhibits to the Registration Statement that are not so filed.

(r)Licenses and Permits. The Partnership possesses or has obtained, all licenses, certificates, consents, orders, approvals, permits and other authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or lease of their respective properties or the conduct of their respective businesses as described in the Registration 

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Statement and the Prospectus (the “Permits”), except where the failure to possess, obtain or make the same would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Partnership has not received written notice of any proceeding relating to revocation or modification of any such Permit or has any reason to believe that such Permit will not be renewed in the ordinary course, except where the failure to obtain any such renewal would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(s)No Material Defaults. The Partnership has not defaulted on any installment on indebtedness for borrowed money or on any rental on one or more long-term leases, which defaults, individually or in the aggregate, have a Material Adverse Effect. The Partnership has not filed a report pursuant to Section 13(a) or 15(d) of the Exchange Act since the filing of its last Annual Report on Form 10-K, indicating that it (i) has failed to pay any dividend or sinking fund installment on preferred stock or (ii) has defaulted on any installment on indebtedness for borrowed money or on any rental on one or more long-term leases, which defaults, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect

(t)S-3 Eligibility. (i) At the time of filing the Registration Statement and (ii) at the time of the most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the Securities Act (whether such amendment was by post-effective amendment, incorporated report filed pursuant to Section 13 or 15(d) of the Exchange Act or form of prospectus), the Partnership met the then applicable requirements for use of Form S-3 under the Securities Act, including compliance with General Instruction I.B.1 of Form S-3.

(u) Certain Market Activities. Neither the Partnership nor, to the Partnership’s knowledge, any of its managers, officers or controlling persons has taken, directly or indirectly, any action designed, or that has constituted or would reasonably be expected to cause or result in, under the Exchange Act or otherwise, the stabilization or manipulation of the price of any security of the Partnership to facilitate the sale or resale of the Placement Units.

(v)Broker/Dealer Relationships. Neither the Partnership nor, to the Partnership’s knowledge, any of the Partnership’s affiliates (i) is required to register as a “broker” or “dealer” in accordance with the provisions of the Exchange Act or (ii) directly or indirectly through one or more intermediaries, controls or is a “person associated with a member” or “associated person of a member” (within the meaning set forth in the FINRA Manual).

(w)No Reliance. The Partnership has not relied upon the Agent or legal counsel for the Agent for any legal, tax or accounting advice in connection with the offering and sale of the Placement Units.

(x)Taxes. The Partnership has filed all federal, state, local and foreign tax returns which have been required to be filed and paid all taxes shown thereon through the date hereof, to the extent that such taxes have become due and are not being contested in good faith, except where the failure to file or pay would not reasonably be expected to have a Material Adverse Effect. Except as otherwise disclosed in or contemplated by the Registration Statement or the Prospectus, no tax deficiency has been determined adversely to the Partnership which has had, or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. The Partnership has no knowledge of any federal, state or other governmental tax deficiency, penalty or assessment which has been or might be asserted or threatened against it which reasonably would be expected to have a Material Adverse Effect.

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(y)Title to Real and Personal Property. The Partnership has good and valid title in fee simple to all items of real property and good and valid title to all personal property described in the Registration Statement or Prospectus as being owned by it that are material to the business of the Partnership, in each case free and clear of all liens, encumbrances and claims, except those that (i) do not materially interfere with the use made and proposed to be made of such property by the Partnership or (ii) would not reasonably expected, individually or in the aggregate, to have a Material Adverse Effect. Any real property described in the Registration Statement or Prospectus as being leased by the Partnership is held by it under valid, existing and enforceable leases, except those that (A) do not materially interfere with the use made or proposed to be made of such property by the Partnership or (B) would not be reasonably expected to have a Material Adverse Effect.

(z)Intellectual Property. The Partnership owns or possesses adequate enforceable rights to use all patents, patent applications, trademarks (both registered and unregistered), service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) (collectively, the “Intellectual Property”), necessary for the conduct of its business as conducted as of the date hereof, except to the extent that the failure to own or possess adequate rights to use such Intellectual Property would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; the Partnership has not received any written notice of any claim of infringement or conflict which asserted Intellectual Property rights of others, which infringement or conflict, if the subject of an unfavorable decision, would result in a Material Adverse Effect; there are no pending, or to the Partnership’s knowledge, threatened judicial proceedings or interference proceedings against the Partnership challenging the Partnership’s rights in or to or the validity of the scope of any of the Partnership’s patents, patent applications or proprietary information.

(aa)Environmental Laws. The Partnership (i) is in compliance with any and all applicable federal, state, local and foreign laws, rules, regulations, decisions and orders relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (collectively, “Environmental Laws”); (ii) has received and is in compliance with all permits, licenses or other approvals required of it under applicable Environmental Laws to conduct its businesses as described in the Registration Statement and the Prospectus; and (iii) has not received notice of any actual or potential liability for the investigation or remediation of any disposal or release of hazardous or toxic substances or wastes, pollutants or contaminants, except, in the case of any of clauses (i), (ii) or (iii) above, for any such failure to comply or failure to receive required permits, licenses, other approvals or liability as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(bb)Disclosure Controls. The Partnership maintains a system of internal control over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f) or 15d-15(f)) designed to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded 

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accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Partnership is not aware of any material weaknesses in its internal control over financial reporting (other than as set forth in the Prospectus). Since the date of the latest audited financial statements of the Partnership included in the Prospectus, there has been no change in the Partnership’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Partnership’s internal control over financial reporting (other than as set forth in the Prospectus). The Partnership has established disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 of the Exchange Act Regulations) for the Partnership and designed such disclosure controls and procedures to ensure that material information relating to the Partnership is made known to the certifying officers by others within those entities, particularly during the period in which the Partnership’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, is being prepared. The Partnership’s certifying officers have evaluated the effectiveness of the Partnership’s controls and procedures as of a date within 90 days prior to the filing date of the Form 10-K for the fiscal year most recently ended (such date, the “Evaluation Date”). The Partnership presented in its Form 10-K for the fiscal year most recently ended the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no significant changes in the Partnership’s internal controls (as such term is defined in Rules 13a-15 and 15d-15 of the Exchange Act Regulations) or, to the Partnership’s knowledge, in other factors that could significantly affect the Partnership’s internal controls. To the knowledge of the Partnership, the Partnership’s “internal controls over financial reporting” and “disclosure controls and procedures” are effective.

(cc)Sarbanes-Oxley. The Partnership is not aware of any failure on the part of the Partnership or any of the Partnership’s managers or officers, in their capacities as such, to comply with any applicable provisions of the Sarbanes-Oxley Act and the applicable rules and regulations promulgated thereunder in all material respects. Each of the principal executive officer and the principal financial officer of the Partnership (or each former principal executive officer of the Partnership and each former principal financial officer of the Partnership as applicable) has made all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act with respect to all reports, schedules, forms, statements and other documents required to be filed by it or furnished by it to the Commission during the 12 months prior to the date of this Agreement. For purposes of the preceding sentence, “principal executive officer” and “principal financial officer” shall have the meanings given to such terms in the Sarbanes-Oxley Act.

(dd)Finder’s Fees. The Partnership has not incurred any liability for any finder’s fees, brokerage commissions or similar payments in connection with the transactions herein contemplated, except as may otherwise exist with respect to Agent pursuant to this Agreement.

(ee)Labor Disputes. No labor disturbance by or dispute with employees of the Partnership exists or, to the knowledge of the Partnership, is threatened which would be reasonably likely to have a Material Adverse Effect

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(ff)Investment Partnership Act. The Partnership is not or after giving effect to the offering and sale of the Placement Units, will not be an “investment Partnership” or an entity “controlled” by an “investment Partnership,” as such terms are defined in the Investment Partnership Act of 1940, as amended (the “Investment Partnership Act”).

(gg)Operations. The operations of the Partnership are and have been conducted at all times in compliance with applicable financial record keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions to which the Partnership is subject, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”), except as would not have a Material Adverse Effect; and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Partnership with respect to the Money Laundering Laws is pending or, to the knowledge of the Partnership, threatened.

(hh)Off-Balance Sheet Arrangements. There are no transactions, arrangements and other relationships between and/or among the Partnership, and/or, to the knowledge of the Partnership, any of its affiliates and any unconsolidated entity, including, but not limited to, any structural finance, special purpose or limited purpose entity (each, an “Off Balance Sheet Transaction”) that would reasonably be expected to affect materially the Partnership’s liquidity or the availability of or requirements for its capital resources, including those Off Balance Sheet Transactions described in the Commission’s Statement about Management’s Discussion and Analysis of Financial Conditions and Results of Operations (Release Nos. 33-8056; 34-45321; FR-61), required to be described in the Prospectus which have not been described as required.

(ii)Underwriter Agreements. Other than with respect to this Agreement, the Partnership is not a party to any agreement with an agent or underwriter for any other “at the market” or continuous equity transaction.

(jj)ERISA. To the knowledge of the Partnership, each material employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that is maintained, administered or contributed to by the Partnership or any of its affiliates for employees or former employees of the Partnership has been maintained in material compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to ERISA and the Internal Revenue Code of 1986, as amended (the “Code”); no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred which would result in a material liability to the Partnership with respect to any such plan excluding transactions effected pursuant to a statutory or administrative exemption; and for each such plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no “accumulated funding deficiency” as defined in Section 412 of the Code has been incurred, whether or not waived, and the fair market value of the assets of each such plan (excluding for these purposes accrued but unpaid contributions) exceeds the present value of all benefits accrued under such plan determined using reasonable actuarial assumptions.

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(kk)Forward Looking Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) (a “Forward Looking Statement”) contained in the Registration Statement and the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith. The Forward Looking Statements incorporated by reference in the Registration Statement and the Prospectus from the Partnership’s Annual Report on Form 10-K for the fiscal year most recently ended (i) are within the coverage of the safe harbor for forward looking statements set forth in Section 27A of the Securities Act, Rule 175(b) under the Securities Act or Rule 3b-6 under the Exchange Act, as applicable, (ii) were made by the Partnership with a reasonable basis and in good faith and reflect the Partnership’s good faith commercially reasonable best estimate of the matters described therein, and (iii) have been prepared in accordance with Item 10 of Regulation S-K under the Securities Act.

(ll)Agent Purchases. The Partnership acknowledges and agrees that Agent has informed the Partnership that the Agent may, to the extent permitted under the Securities Act and the Exchange Act, purchase and sell BUCs for its own account while this Agreement is in effect, provided, that (i) no such purchase or sales shall take place while a Placement Notice is in effect (except to the extent each Agent may engage in sales of Placement Units purchased or deemed purchased from the Partnership as a “riskless principal” or in a similar capacity) and (ii) the Partnership shall not be deemed to have authorized or consented to any such purchases or sales by the Agent.

(mm)Margin Rules. To the Partnership’s knowledge, neither the issuance, sale and delivery of the Placement Units nor the application of the proceeds thereof by the Partnership as described in the Registration Statement and the Prospectus will violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.

(nn)Insurance. The Partnership carries, or is covered by, insurance in such amounts and covering such risks as the Partnership reasonably believes is adequate for the conduct of its business and as is customary for companies engaged in similar businesses in similar industries.

(oo)No Improper Practices. (i) Neither the Partnership, nor to the Partnership’s knowledge, any of its executive officers has, in the past five years, made any unlawful contributions to any candidate for any political office (or failed fully to disclose any contribution in violation of law) or made any contribution or other payment to any official of, or candidate for, any federal, state, municipal, or foreign office or other person charged with similar public or quasi-public duty in violation of any law or of the character required to be disclosed in the Prospectus; (ii) no relationship, direct or indirect, exists between or among the Partnership or, to the Partnership’s knowledge, any affiliate of it, on the one hand, and the managers, officers and partners of the Partnership, that is required by the Securities Act to be described in the Registration Statement and the Prospectus that is not so described; (iii) no relationship, direct or indirect, exists between or among the Partnership, or any affiliate of it, on the one hand, and the managers, officers, or partners of the Partnership that is required by the rules of FINRA to be described in the Registration Statement and the Prospectus that is not so described; (iv) there are no material outstanding loans or advances or material guarantees of indebtedness by the Partnership to or for 

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the benefit of any of its managers or officers or any of the members of the families of any of them; (v) the Partnership has not offered, or caused any placement agent to offer, BUCs to any person with the intent to influence unlawfully (A) a customer or supplier of the Partnership to alter the customer’s or supplier’s level or type of business with the Partnership or (B) a trade journalist or publication to write or publish favorable information about the Partnership or any of its products or services, and, (vi) neither the Partnership nor, to the Partnership’s knowledge, any employee or agent of the Partnership has made any payment of funds of the Partnership or received or retained any funds in violation of any law, rule or regulation (including, without limitation, the Foreign Corrupt Practices Act of 1977, which payment, receipt or retention of funds is of a character required to be disclosed in the Registration Statement or the Prospectus).

(pp)Compliance with Applicable Laws. The conduct of business by the Partnership complies, and at all times has complied, in all material respects with federal, state, local and foreign laws, statutes, ordinances, rules, regulations, decrees, orders, Permits and other similar items (“Laws”) applicable to its business, including, without limitation, any licensing and certification Laws covering any aspect of the business of the Partnership. The Partnership has not received any notification asserting, nor has knowledge of, any present or past failure to comply with or violation of any such Laws.

(qq)Tax Status.  The Partnership is a limited partnership and has been and is treated as a publicly traded partnership that is not taxable as a corporation and not as either a corporation or an association taxable as a corporation for federal income tax purposes, and the holders of the Placement Units will be treated as partners for U.S. federal income tax purposes.

(rr)Status Under the Securities Act. The Partnership was not and is not an ineligible issuer as defined in Rule 405 under the Securities Act at the times specified in Rules 164 and 433 under the Securities Act in connection with the offering of the Placement Units.

(ss)No Misstatement or Omission in an Issuer Free Writing Prospectus. Each Issuer Free Writing Prospectus, as of its issue date and as of each Applicable Time (as defined in Section 24 below), did not, does not and will not include any information that conflicted, conflicts or will conflict with the information contained in the Registration Statement or the Prospectus, including any incorporated document deemed to be a part thereof that has not been superseded or modified. The foregoing sentence does not apply to statements in or omissions from any Issuer Free Writing Prospectus based upon and in conformity with written information furnished to the Partnership by the Agent specifically for use therein.

(tt)No Conflicts. Neither the execution of this Agreement, nor the issuance, offering or sale of the Placement Units, nor the consummation of any of the transactions contemplated herein and therein, nor the compliance by the Partnership with the terms and provisions hereof and thereof will conflict with, or will result in a breach of, any of the terms and provisions of, or has constituted or will constitute a default under, or has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Partnership pursuant to the terms of any contract or other agreement to which the Partnership may be bound or to which any of the property or assets of the Partnership is subject, except (i) such conflicts, breaches or defaults as may have been waived and (ii) such conflicts, breaches and defaults that would not have a Material Adverse Effect; nor will such action result (x) in any 

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violation of the provisions of the organizational or governing documents of the Partnership, or (y) in any material violation of the provisions of any statute or any order, rule or regulation applicable to the Partnership or of any court or of any federal, state or other regulatory authority or other government body having jurisdiction over the Partnership.

(uu)OFAC.  None of the Partnership or, to the knowledge of the Partnership, any manager, officer, agent, employee, affiliate or representative of the Partnership is a government, individual or entity (in this paragraph (uu), “Person”) that is, or is owned or controlled by a Person that is, currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”); provided however, that for the purposes of this paragraph (uu), no person shall be an affiliate of the Partnership solely by reason of owning less than a majority of any class of voting securities of the Partnership. The Partnership will not directly or indirectly use the proceeds of the offering of the Placement Units hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

(vv) Stock Transfer Taxes. On each Settlement Date, all stock transfer or other taxes (other than income taxes) which are required to be paid in connection with the sale and transfer of the Placement Units to be sold hereunder will be, or will have been, fully paid or provided for by the Partnership and all laws imposing such taxes will be or will have been fully complied with.

Any certificate signed by an officer of the Partnership and delivered to the Agent or to counsel for the Agent pursuant to or in connection with this Agreement shall be deemed to be a representation and warranty by the Partnership, as applicable, to the Agent as to the matters set forth therein.

7.Covenants of the Partnership. The Partnership covenants and agrees with Agent that:

(a)Registration Statement Amendments. After the date of this Agreement and during any period in which a Prospectus relating to any Placement Units is required to be delivered by Agent under the Securities Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172 under the Securities Act), (i) the Partnership will notify the Agent promptly of the time when any subsequent amendment to the Registration Statement, other than documents incorporated by reference, has been filed with the Commission and/or has become effective or any subsequent supplement to the Prospectus has been filed and of any request by the Commission for any amendment or supplement to the Registration Statement or Prospectus or for additional information, , (ii) if any event shall occur as a result of which, in the reasonable opinion of the Partnership or the Agent, it becomes necessary to amend or supplement the Registration Statement or Prospectus in order to make the statements therein, in light of the circumstances existing at the time the Prospectus is delivered to a purchaser, not misleading, the Partnership will prepare and file with the Commission, promptly upon the Agent’s request or upon the determination of the Partnership, any amendments or supplements to the Registration Statement or Prospectus so that, in connection with the distribution of the Placement Units by the Agent, the Prospectus as so amended or supplemented will not, in light of the circumstances when it is so 

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delivered, be misleading  (provided, however, that the failure of the Agent to make such request shall not relieve the Partnership of any obligation or liability hereunder, or affect the Agent’s right to rely on the representations and warranties made by the Partnership in this Agreement and provided, further, that the only remedy the Agent shall have with respect to the failure to make such filing shall be to cease making sales under this Agreement until such amendment or supplement is filed), (iii) the Partnership will not file any amendment or supplement to the Registration Statement or Prospectus relating to the Placement Units or a security convertible into the Placement Units unless a copy thereof has been submitted to Agent within a reasonable period of time before the filing and the Agent has not objected thereto (provided, however, that (A) the failure of the Agent to make such objection shall not relieve the Partnership of any obligation or liability hereunder, or affect the Agent’s right to rely on the representations and warranties made by the Partnership in this Agreement and (B) the Partnership has no obligation to provide the Agent any advance copy of such filing or to provide the Agent an opportunity to object to such filing if the filing does not name the Agent or does not relate to the transaction herein provided; and provided, further, that the only remedy Agent shall have with respect to the failure to by the Partnership to obtain such consent shall be to cease making sales under this Agreement) and the Partnership will furnish to the Agent at the time of filing thereof a copy of any document that upon filing is deemed to be incorporated by reference into the Registration Statement or Prospectus, except for those documents available via EDGAR; and (iv) the Partnership will cause each amendment or supplement to the Prospectus to be filed with the Commission as required pursuant to the applicable paragraph of Rule 424(b) of the Securities Act or, in the case of any document to be incorporated therein by reference, to be filed with the Commission as required pursuant to the Exchange Act, within the time period prescribed (the determination to file or not file any amendment or supplement with the Commission under this Section 7(a), based on the Partnership’s reasonable opinion or reasonable objections, shall be made exclusively by the Partnership).  Notwithstanding the foregoing, this Section 7(a) shall not be construed to limit the Partnership’s ability to file with the Commission a registration statement on Form S-3 pursuant to Rule 415(a)(6) of the Securities Act to cover any securities registered pursuant to the current Registration Statement, including any Placement Units, as a result of the end of the three-year period described in Rule 415(a)(5) of the Securities Act.

(b)Notice of Commission Stop Orders. The Partnership will advise the Agent, promptly after it receives notice or obtains knowledge thereof, of the issuance or threatened issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement, of the suspension of the qualification of the Placement Units for offering or sale in any jurisdiction, or of the initiation or threatening of any proceeding for any such purpose; and it will promptly use its commercially reasonable efforts to prevent the issuance of any stop order or to obtain its withdrawal if such a stop order should be issued. The Partnership will advise the Agent promptly after it receives any request by the Commission for any amendments to the Registration Statement or any amendment or supplements to the Prospectus or any Issuer Free Writing Prospectus or for additional information related to the offering of the Placement Units or for additional information related to the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus.

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(c)Delivery of Prospectus; Subsequent Changes. During any period in which a Prospectus relating to the Placement Units is required to be delivered by the Agent under the Securities Act with respect to the offer and sale of the Placement Units, (including in circumstances where such requirement may be satisfied pursuant to Rule 172 under the Securities Act), the Partnership will use its commercially reasonable efforts to comply with all requirements imposed upon it by the Securities Act, as from time to time in force, and to file on or before their respective due dates all reports and any definitive proxy or information statements required to be filed by the Partnership with the Commission pursuant to Sections 13(a), 13(c), 14, 15(d) or any other provision of or under the Exchange Act. If the Partnership has omitted any information from the Registration Statement pursuant to Rule 430A under the Securities Act, it will use commercially reasonable efforts to comply with the provisions of and make all requisite filings with the Commission pursuant to said Rule 430A and to notify the Agent promptly of all such filings. If during such period any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary to amend or supplement the Registration Statement or Prospectus to comply with the Securities Act, the Partnership will promptly notify Agent to suspend the offering of Placement Units during such period and the Partnership will promptly amend or supplement the Registration Statement or Prospectus (at the expense of the Partnership) so as to correct such statement or omission or effect such compliance; provided, however, that the Partnership may delay the filing of any amendment or supplement, if in the judgment of the Partnership, it is in the best interests of the Partnership.

(d)Listing of Placement Units. During any period in which the Prospectus relating to the Placement Units is required to be delivered by the Agent under the Securities Act with respect to the offer and sale of the Placement Units, the Partnership will use its commercially reasonable efforts to cause the Placement Units to be listed on the Exchange and to qualify the Placement Units for sale under the securities laws of such jurisdictions as Agent reasonably designates and to continue such qualifications in effect so long as required for the distribution of the Placement Units; provided, however, that the Partnership shall not be required in connection therewith to qualify as a foreign corporation or dealer in securities or file a general consent to service of process in any jurisdiction.

(e)Delivery of Registration Statement and Prospectus. The Partnership will furnish to the Agent and its counsel (at the expense of the Partnership) copies of the Registration Statement, the Prospectus (including all documents incorporated by reference therein) and all amendments and supplements to the Registration Statement or Prospectus that are filed with the Commission during any period in which a Prospectus relating to the Placement Units is required to be delivered under the Securities Act (including all documents filed with the Commission during such period that are deemed to be incorporated by reference therein), in each case as soon as reasonably practicable and in such quantities as the Agent may from time to time reasonably request and, at Agent’s request, will also furnish copies of the Prospectus to each exchange or market on which sales of the Placement Units may be made; provided, however, that the Partnership shall not be required to furnish any document (other than the Prospectus) to the Agent to the extent such document is available on EDGAR.

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(f)Earnings Statement. The Partnership will make generally available to its security holders as soon as practicable, but in any event not later than 15 months after the end of the Partnership’s current fiscal quarter, an earnings statement covering a 12-month period that satisfies the provisions of Section 11(a) and Rule 158 of the Securities Act.

(g)Use of Proceeds. The Partnership will use the Net Proceeds as described in the Prospectus in the section entitled “Use of Proceeds.”

(h)Notice of Other Sales. Without prior written notice to Agent, the Partnership will not, directly or indirectly, offer to sell, sell, contract to sell, grant any option to sell or otherwise dispose of any BUCs (other than the Placement Units offered pursuant to this Agreement) or securities convertible into or exchangeable for BUCs, warrants or any rights to purchase or acquire, BUCs during the period beginning on the date on which any Placement Notice is delivered to Agent hereunder and ending on the second (2nd) Trading Day immediately following the final Settlement Date with respect to Placement Units sold pursuant to such Placement Notice (or, if the Placement Notice has been terminated or suspended prior to the sale of all Placement Units covered by a Placement Notice, the date of such suspension or termination); and will not directly or indirectly in any other “at the market” or continuous equity transaction offer to sell, sell, contract to sell, grant any option to sell or otherwise dispose of any BUCs (other than the Placement Units offered pursuant to this Agreement) or securities convertible into or exchangeable for BUCs, warrants or any rights to purchase or acquire, BUCs prior to the termination of this Agreement; provided, however, that such restrictions will not be required in connection with the Partnership’s issuance or sale of (i) BUCs, restricted units, options to purchase BUCs or BUCs issuable upon the exercise of options, pursuant to any employee or director option or benefits plan, equity ownership plan or dividend reinvestment plan (but not BUCs subject to a waiver to exceed plan limits in any dividend reinvestment plan that the Partnership adopts or may be adopted in the future) of the Partnership whether now in effect or hereafter implemented, (ii) BUCs issuable upon conversion of securities or the exercise of warrants, options or other rights in effect or outstanding, and disclosed in filings by the Partnership available on EDGAR or otherwise in writing to the Agent, and (iii) BUCs, or securities convertible into or exercisable for BUCs, offered and sold in a negotiated transaction to vendors, customers, strategic partners or potential strategic partners, acquisition candidates or other investors conducted in a manner so as not to be integrated with the offering of BUCs hereby.  Notwithstanding the foregoing, nothing herein shall be construed to restrict the Partnership’s ability to file a registration statement under the Securities Act or require the Partnership to provide notice to the Agent of any filing thereof.

(i)Change of Circumstances. The Partnership will, at any time during the pendency of a Placement Notice advise the Agent promptly after it shall have received notice or obtained knowledge thereof, of any information or fact that would alter or affect in any material respect any opinion, certificate, letter or other document required to be provided to the Agent pursuant to this Agreement.

(j)Due Diligence Cooperation. During the term of this Agreement, the Partnership will cooperate with any reasonable due diligence review conducted by the Agent or its representatives in connection with the transactions contemplated hereby, including, without limitation, providing information and making available documents and senior corporate officers, during regular business hours and at the Partnership’s principal offices, as the Agent may reasonably request.

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(k)Required Filings Relating to Placement of Placement Units. The Partnership agrees that on such dates as the Securities Act shall require with respect to the Placement Units, the Partnership will (i) file a prospectus supplement with the Commission under the applicable paragraph of Rule 424(b) under the Securities Act (each and every filing under Rule 424(b), a “Filing Date”), which prospectus supplement will set forth, within the relevant period, the amount of Placement Units sold through the Agent, the Net Proceeds to the Partnership and the compensation payable by the Partnership to the Agent with respect to such Placement Units, and (ii) deliver such number of copies of each such prospectus supplement to each exchange or market on which such sales were effected as may be required by the rules or regulations of such exchange or market.

(l)Representation Dates; Certificate. On the date of this Agreement and within five (5) trading days of each time the Partnership:

(i)files the Prospectus relating to the Placement Units or amends or supplements (other than a prospectus supplement relating solely to an offering of securities other than the Placement Units), the Registration Statement or the Prospectus relating to the Placement Units by means of a post-effective amendment, sticker, or supplement but not by means of incorporation of documents by reference into the Registration Statement or the Prospectus relating to the Placement Units;

(ii)files an annual report on Form 10-K under the Exchange Act (including any Form 10-K/A containing amended financial information or a material amendment to the previously filed Form 10-K); 

(iii)files its quarterly reports on Form 10-Q under the Exchange Act; or

(iv)files a current report on Form 8-K containing amended financial information (other than information “furnished” pursuant to Items 2.02 or 7.01 of Form 8-K or to provide disclosure pursuant to Item 8.01 of Form 8-K relating to the reclassification of certain properties as discontinued operations in accordance with Statement of Financial Accounting Standards No. 144) under the Exchange Act; (Each date of filing of one or more of the documents referred to in clauses (i) through (iv) shall be a “Representation Date.”) the Partnership shall furnish the Agent (but in the case of clause (iv) above only if the Agent reasonably determines that the information contained in such Form 8-K is material) with a certificate, in the form attached hereto as Exhibit 7(l). The requirement to provide a certificate under this Section 7(l) shall be waived for any Representation Date occurring at a time at which no Placement Notice is pending, which waiver shall continue until the earlier to occur of the date the Partnership delivers a Placement Notice hereunder (which for such calendar quarter shall be considered a Representation Date) and the next occurring Representation Date; provided, however, that such waiver shall not apply for any Representation Date on which the Partnership files its annual report on Form 10-K. Notwithstanding the foregoing, if the Partnership subsequently decides to sell Placement Units following a Representation Date when the Partnership relied on such waiver and did not provide the Agent with a certificate under this Section 7(l), then before the Partnership delivers the Placement Notice or the Agent sells any Placement Units, the Partnership shall provide the Agent with a certificate, in the form attached hereto as Exhibit 7(l), dated the date of the Placement Notice.

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(m)Legal Opinion. (1) On or prior to the date of the first Placement Notice given hereunder and (2) within five (5) Trading Days of each Representation Date with respect to which the Partnership is obligated to deliver a certificate in the form attached hereto as Exhibit 7(l) for which no waiver is applicable, the Partnership shall cause to be furnished to the Agent a written opinion of Barnes & Thornburg LLP and, with respect to certain tax matters only, Baird Holm LLP (collectively, “Partnership Counsel”), or other counsel reasonably satisfactory to the Agent, in form and substance reasonably satisfactory to Agent and its counsel; provided, that in lieu of such opinions for subsequent periodic filings under the Exchange Act, counsel may furnish the Agent with a letter (a “Reliance Letter”) to the effect that the Agent may rely on a prior opinion delivered under this Section 7(m) to the same extent as if it were dated the date of such letter (except that statements in such prior opinion shall be deemed to relate to the Registration Statement and the Prospectus as amended or supplemented as of the date of the Reliance Letter).

(n)Comfort Letter. (1) On the date of this Agreement and (2) within five (5) Trading Days of each Representation Date, other than pursuant to Section 7(l)(iii), with respect to which the Partnership is obligated to deliver a certificate in the form attached hereto as Exhibit 7(l) for which no waiver is applicable, the Partnership shall cause its independent accountants to furnish the Agent letters (the “Comfort Letters”), dated the date the Comfort Letter is delivered, which shall meet the requirements set forth in this Section 7(n); provided, that if requested by the Agent, the Partnership shall cause a Comfort Letter to be furnished to the Agent within ten (10) Trading Days of the date of occurrence of any material transaction or event, including the restatement of the Partnership’s financial statements. The Comfort Letter from the Partnership’s independent accountants shall be in a form and substance reasonably satisfactory to the Agent, (i) confirming that they are an independent public accounting firm within the meaning of the Securities Act and the PCAOB, (ii) stating, as of such date, the conclusions and findings of such firm with respect to the financial information and other matters ordinarily covered by accountants’ “comfort letters” to underwriters in connection with registered public offerings (the first such letter, the “Initial Comfort Letter”) and (iii) updating the Initial Comfort Letter with any information that would have been included in the Initial Comfort Letter had it been given on such date and modified as necessary to relate to the Registration Statement and the Prospectus, as amended and supplemented to the date of such letter.

(o)Market Activities. The Partnership will not, directly or indirectly, (i) take any action designed to cause or result in, or that constitutes or might reasonably be expected to constitute, the stabilization or manipulation of the price of any security of the Partnership to facilitate the sale or resale of BUCs or (ii) sell, bid for, or purchase BUCs, or pay anyone any compensation for soliciting purchases of the Placement Units other than the Agent; provided that, notwithstanding the foregoing, the Partnership may, subjection to limitations of applicable law, including by not limited to Regulation M, bid for and purchase BUCs in accordance with Rule 10b-18 under the Exchange Act.

(p)Investment Company Act. The Partnership will conduct its affairs in such a manner so as to reasonably ensure that it will not become, at any time prior to the termination of this Agreement, an “investment company,” as such term is defined in the Investment Company Act.

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(q)No Offer to Sell. Other than the Prospectus and any Issuer Free Writing Prospectus approved in advance by the Partnership and the Agent in its capacity as agent hereunder, neither the Agent nor the Partnership (including its agents and representatives, other than Agent in its capacity as such) will make, use, prepare, authorize, approve or refer to any written communication (as defined in Rule 405 under the Securities Act), required to be filed with the Commission, that constitutes an offer to sell or solicitation of an offer to buy Placement Units hereunder.

(r)Sarbanes-Oxley Act. The Partnership will maintain and keep accurate books and records reflecting its assets and maintain internal accounting controls in a manner designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and including those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Partnership, (ii) provide reasonable assurance that transactions are recorded as necessary to permit the preparation of the Partnership’s consolidated financial statements in accordance with generally accepted accounting principles, (iii) that receipts and expenditures of the Partnership are being made only in accordance with management’s and the Partnership’s directors’ and managers’ authorization, and (iv) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Partnership’s assets that could have a material effect on its financial statements. The Partnership will use commercially reasonable efforts to maintain such controls and other procedures, including, without limitation, those required by Sections 302 and 906 of the Sarbanes-Oxley Act, and the applicable regulations thereunder that are designed to ensure that information required to be disclosed by the Partnership in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, including, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Partnership in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Partnership’s management, including its principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure and to ensure that material information relating to the Partnership is made known to it by others within the Partnership, particularly during the period in which such periodic reports are being prepared.

8.Payment of Expenses. The Partnership will pay all expenses incident to the performance of its obligations under this Agreement, including (i) the preparation, filing, including any fees required by the Commission, and printing of the Registration Statement (including financial statements and exhibits) as originally filed and of each amendment and supplement thereto, in such number as the Agent shall reasonably deem necessary, (ii) the printing and delivery to the Agent of this Agreement and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the Placement Units, (iii) the preparation, issuance and delivery of the certificates, if any, for the Placement Units to the Agent, including any stock or other transfer taxes and any capital duties, stamp duties or other duties or taxes payable upon the sale, issuance or delivery of the Placement Units to the Agent, (iv) the fees and disbursements of the counsel, accountants and other advisors to the Partnership, (v) the reasonable and documented out-of-pocket expenses of Agent, including fees and disbursements of 

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counsel to the Agent, (vi) the printing and delivery to the Agent of copies of any Permitted Issuer Free Writing Prospectus (defined below) and the Prospectus and any amendments or supplements thereto in such number as the Agent shall deem reasonably necessary, (vii) the preparation, printing and delivery to the Agent of copies of the blue sky survey and any Canadian “wrapper” and any supplements thereto, in such number as the Agent shall deem reasonably necessary, (viii) the fees and expenses of the transfer agent and registrar for the BUCs, (ix) the fees and expenses incident to any review by FINRA of the terms of the sale of the Placement Units, including fees and expenses of counsel to the Agent, and (x) the fees and expenses incurred in connection with the listing of the Placement Units on the Exchange. Notwithstanding the foregoing, in no event shall the amount of expenses reimbursed to Agent hereunder exceed $50,000.

9.Conditions to Agent’s Obligations. The obligations of the Agent hereunder with respect to a Placement will be subject to the continuing accuracy and completeness of the representations and warranties made by the Partnership herein, to the due performance by the Partnership of its obligations hereunder, to the completion by the Agent of a due diligence review satisfactory to it in its reasonable judgment, and to the continuing satisfaction (or waiver by the Agent in its sole discretion) of the following additional conditions:

(a)Registration Statement Effective. The Registration Statement shall have become effective and shall be available for the sale of all Placement Units contemplated to be issued by any Placement Notice.

(b)No Material Notices. None of the following events shall have occurred and be continuing: (i) receipt by the Partnership of any request for additional information from the Commission or any other federal or state governmental authority during the period of effectiveness of the Registration Statement, the response to which would require any post-effective amendments or supplements to the Registration Statement or the Prospectus; (ii) the issuance by the Commission or any other federal or state governmental authority of any stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings for that purpose; (iii) receipt by the Partnership of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Placement Units for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; or (iv) the occurrence of any event that makes any material statement made in the Registration Statement or the Prospectus or any material document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires the making of any changes in the Registration Statement, the Prospectus or documents so that, in the case of the Registration Statement, it will not contain any materially untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading and, that in the case of the Prospectus, it will not contain any materially untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(c)No Misstatement or Material Omission. Agent shall not have advised the Partnership that the Registration Statement or Prospectus, or any amendment or supplement thereto, contains an untrue statement of fact that in the Agent’s reasonable opinion is material, or omits to state a fact that in the Agent’s reasonable opinion is material and is required to be stated therein or is necessary to make the statements therein not misleading.

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(d)Material Changes. Except as contemplated in the Prospectus, or disclosed in the Partnership’s reports filed with the Commission, there shall not have been any material adverse change, on a consolidated basis, in the partners’ capital of the Partnership or any Material Adverse Effect, or any development that could reasonably be expected to cause a Material Adverse Effect.

(e)Legal Opinion. The Agent shall have received the opinions of Partnership Counsel required to be delivered pursuant Section 7(m) on or before the date on which such delivery of such opinions is required pursuant to Section 7(m).

(f)Comfort Letter. The Agent shall have received the Comfort Letter required to be delivered pursuant Section 7(n) on or before the date on which such delivery of such Comfort Letter is required pursuant to Section 7(n).

(g)Representation Certificate. The Agent shall have received the certificate required to be delivered pursuant to Section 7(l) on or before the date on which delivery of such certificate is required pursuant to Section 7(l).

(h)Secretary’s Certificate. On the date of this Agreement, the Agent shall have received a certificate, signed on behalf of the Partnership by its corporate Secretary, in form and substance satisfactory to the Agent and its counsel.

(i)No Suspension. Trading in BUCs shall not have been suspended on the Exchange, and the BUCs shall not have been delisted from the Exchange.

(j)Other Materials. On each date on which the Partnership is required to deliver a certificate pursuant to Section 7(l), the Partnership shall have furnished to the Agent such appropriate further information, certificates and documents as the Agent may reasonably request. All such opinions, certificates, letters and other documents will be in compliance with the provisions hereof. The Partnership will furnish the Agent with such conformed copies of such opinions, certificates, letters and other documents as the Agent shall reasonably request.

(k)Securities Act Filings Made. All filings with the Commission required by Rule 424 under the Securities Act to have been filed prior to the issuance of any Placement Notice hereunder shall have been made within the applicable time period prescribed for such filing by Rule 424.

(l)Approval for Listing. The Placement Units shall either have been approved for listing quotation on the Exchange, subject only to notice of issuance, or the Partnership shall have filed an application for listing quotation of the Placement Units on the Exchange at, or prior to, the issuance of any Placement Notice.

(m)No Termination Event. There shall not have occurred any event that would permit the Agent to terminate this Agreement pursuant to Section 12(a).

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10.Indemnification and Contribution.

(a)Partnership Indemnification. The Partnership agrees to indemnify and hold harmless the Agent, its partners, members, directors, officers, employees and agents and each person, if any, who controls the Agent within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act as follows:

(i)against any and all loss, liability, claim, damage and expense whatsoever, as incurred, joint or several, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading, or arising out of any untrue statement or alleged untrue statement of a material fact included in any related Issuer Free Writing Prospectus or the Prospectus (or any amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;

(ii)against any and all loss, liability, claim, damage and expense whatsoever, as incurred, joint or several, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 10(d) below) any such settlement is effected with the written consent of the Agent, which consent shall not unreasonably be delayed or withheld; and

(iii)against any and all expense whatsoever, as incurred (including the reasonable and documented fees and disbursements of counsel), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, of the Partnership to the extent that any such expense is not paid under (i) or (ii) above, provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made solely in reliance upon and in conformity with written information furnished to the Partnership by the Agent expressly for use in the Registration Statement (or any amendment thereto), or in any related Issuer Free Writing Prospectus or the Prospectus (or any amendment or supplement thereto).

(b)Agent Indemnification. Agent agrees to indemnify and hold harmless the Partnership and each officer and manager of the Partnership who signed the Registration Statement, and each person, if any, who (i) controls the Partnership within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act or (ii) is controlled by or is under common control with the Partnership against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 10(a), as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendments thereto) or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with information relating to the Agent and furnished to the Partnership in writing by the Agent expressly for use therein.

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(c)Procedure. Any party that proposes to assert the right to be indemnified under this Section 10 will, promptly after receipt of notice of commencement of any action against such party in respect of which a claim is to be made against an indemnifying party or parties under this Section 10, notify each such indemnifying party of the commencement of such action, enclosing a copy of all papers served, but the omission so to notify such indemnifying party will not relieve the indemnifying party from (i) any liability that it might have to any indemnified party otherwise than under this Section 10 and (ii) any liability that it may have to any indemnified party under the foregoing provision of this Section 10 unless, and only to the extent that, such omission results in the forfeiture of substantive rights or defenses by the indemnifying party. If any such action is brought against any indemnified party and it notifies the indemnifying party of its commencement, the indemnifying party will be entitled to participate in and, to the extent that it elects by delivering written notice to the indemnified party promptly after receiving notice of the commencement of the action from the indemnified party, jointly with any other indemnifying party similarly notified, to assume the defense of the action, with counsel reasonably satisfactory to the indemnified party, and after notice from the indemnifying party to the indemnified party of its election to assume the defense, the indemnifying party will not be liable to the indemnified party for any legal or other expenses except as provided below and except for the reasonable and documented costs of investigation subsequently incurred by the indemnified party in connection with the defense. The indemnified party will have the right to employ its own counsel in any such action, but the fees, expenses and other charges of such counsel will be at the expense of such indemnified party unless (1) the employment of counsel by the indemnified party has been authorized in writing by the indemnifying party, (2) the indemnified party has reasonably concluded (based on advice of counsel) that there may be legal defenses available to it or other indemnified parties that are different from or in addition to those available to the indemnifying party, (3) a conflict or potential conflict exists (based on advice of counsel to the indemnified party) between the indemnified party and the indemnifying party (in which case the indemnifying party will not have the right to direct the defense of such action on behalf of the indemnified party) or (4) the indemnifying party has not in fact employed counsel to assume the defense of such action within a reasonable time after receiving notice of the commencement of the action, in each of which cases the reasonable and documented fees, disbursements and other charges of counsel will be at the expense of the indemnifying party or parties. It is understood that the indemnifying party or parties shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the reasonable fees, disbursements and other charges of more than one separate firm admitted to practice in such jurisdiction at any one time for all such indemnified party or parties. All such fees, disbursements and other charges will be reimbursed by the indemnifying party promptly after the indemnifying party receives a written invoice relating to fees, disbursements and other reasonable charges in reasonable detail. An indemnifying party will not, in any event, be liable for any settlement of any action or claim effected without its written consent. No indemnifying party shall, without the prior written consent of each indemnified party, settle or compromise or consent to the entry of any judgment in any pending or threatened claim, action or proceeding relating to the matters contemplated by this Section 10 (whether or not any indemnified party is a party thereto), unless such settlement, compromise or consent (1) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (2) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

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(d)Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in the foregoing paragraphs of this Section 10 is applicable in accordance with its terms but for any reason is held to be unavailable from the Partnership or the Agent, the Partnership and the Agent will contribute to the total losses, claims, liabilities, expenses and damages (including any investigative, legal and other expenses reasonably incurred and documented in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted, but after deducting any contribution received by the Partnership from persons other than the Agent, such as persons who control the Partnership within the meaning of the Securities Act, officers and managers of the Partnership who signed the Registration Statement, who also may be liable for contribution) to which the Partnership and the Agent may be subject in such proportion as shall be appropriate to reflect the relative benefits received by the Partnership on the one hand and the Agent on the other hand. The relative benefits received by the Partnership on the one hand and the Agent on the other hand shall be deemed to be in the same proportion as the total net proceeds from the sale of the Placement Units (before deducting expenses) received by the Partnership bear to the total compensation received by the Agent (before deducting expenses) from the sale of Placement Units on behalf of the Partnership. If, but only if, the allocation provided by the foregoing sentence is not permitted by applicable law, the allocation of contribution shall be made in such proportion as is appropriate to reflect not only the relative benefits referred to in the foregoing sentence but also the relative fault of the Partnership, on the one hand, and the Agent, on the other hand, with respect to the statements or omission that resulted in such loss, claim, liability, expense or damage, or action in respect thereof, as well as any other relevant equitable considerations with respect to such offering. Such relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Partnership or the Agent, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Partnership and the Agent agree that it would not be just and equitable if contributions pursuant to this Section 10(d) were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, liability, expense, or damage, or action in respect thereof, referred to above in this Section 10(d) shall be deemed to include, for the purpose of this Section 10(d), any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim to the extent consistent with Section 10(c) hereof. Notwithstanding the foregoing provisions of this Section 10(d), the Agent shall not be required to contribute any amount in excess of the commissions received by it under this Agreement and no person found guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 10(d), any person who controls a party to this Agreement within the meaning of the Securities Act, and any officers, directors, managers, partners, employees or agents of the Agent, will have the same rights to contribution as that party, and each officer and manager of the Partnership who signed the Registration Statement will have the same rights to contribution as the Partnership, subject in each case to the provisions hereof. Any party entitled to contribution, promptly after receipt of notice of commencement of any action against such party in respect of which a claim for contribution may be made under this Section 10(d), will notify any such party or parties from whom contribution may be sought, but the omission to so notify will not relieve that party or parties from whom contribution may be sought from any other obligation it or they may have under this Section 10(d) except to the extent that the failure to so notify such other party materially prejudiced the substantive rights or defenses of the party from whom contribution is sought. Except for a settlement entered into pursuant to the last sentence of Section 10(c) hereof, no party will be liable for contribution with respect to any action or claim settled without its written consent if such consent is required pursuant to Section 10(c) hereof.

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11.Additional Covenants.

(a)Representations and Covenants of the Agent. The Agent represents and warrants that it is duly registered as a broker-dealer under FINRA, the Exchange Act and the applicable statutes and regulations of each state in which the Placement Units will be offered and sold, except such states in which the Agent is exempt from registration or such registration is not otherwise required. The Agent shall continue, for the term of this Agreement, to be duly registered as a broker-dealer under FINRA, the Exchange Act and the applicable statutes and regulations of each state in which the Placement Units will be offered and sold, except such states in which the Agent is exempt from registration or such registration is not otherwise required, during the term of this Agreement. The Agent shall comply with all applicable law and regulations in connection with the transactions contemplated by this Agreement, including the issuance and sale through the Agent of the Placement Units.

(b)Representations and Agreements to Survive Delivery. The indemnity and contribution agreements contained in Section 10 of this Agreement and all representations and warranties of the Partnership herein or in certificates delivered pursuant hereto shall survive, as of their respective dates, regardless of (i) any investigation made by or on behalf of the Agent, any controlling persons, or the Partnership (or any of their respective officers, directors or controlling persons), (ii) delivery and acceptance of the Placement Units and payment therefor or (iii) any termination of this Agreement.

12.Termination.

(a)The Agent may terminate this Agreement, by written notice to the Partnership, as hereinafter specified at any time (1) if there has been, since the time of execution of this Agreement or since the date as of which information is given in the Prospectus, any Material Adverse Effect, or any development that would reasonably expected to result in a Material Adverse Effect has occurred which, in the reasonable judgment of the Agent, is material and adverse and makes it impractical or inadvisable to market the Placement Units or to enforce contracts for the sale of the Placement Units, (2) if there has occurred any material adverse change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the reasonable judgment of the Agent, impracticable or inadvisable to market the Placement Units or to enforce contracts for the sale of the Placement Units, (3) if trading in the BUCs has been suspended or limited by the Commission or the Exchange, or if trading generally on the Exchange has been suspended or limited, or minimum prices for trading have been fixed on the Exchange, (4) if any suspension of trading of any securities of the Partnership on any exchange or in the over-the-counter market shall have occurred and be continuing, (5) if a major disruption of securities settlements or clearance services in the United States shall have occurred and be continuing, or (6) if a banking moratorium has been declared by either U.S. Federal or New York authorities. Any such termination shall be without liability of any party to any other party except that the provisions of Section 8 (Expenses), Section 10 (Indemnification), Section 11 (Survival of Representations), Section 17 (Governing Law; Consent to Jurisdiction) and Section 18 (Waiver of Jury Trial) hereof shall remain in full force and effect notwithstanding such termination. If the Agent elects to terminate this Agreement as provided in this Section 12(a), the Agent shall provide the required written notice as specified in Section 13 (Notices).

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(b)The Partnership shall have the right, by giving ten days written notice as hereinafter specified, to terminate this Agreement in its sole discretion at any time after the date of this Agreement. Any such termination shall be without liability of any party to any other party except that the provisions of Section 8, Section 10, Section 11, Section 17 and Section 18 hereof shall remain in full force and effect notwithstanding such termination.

(c)The Agent shall have the right, by giving ten days written notice as hereinafter specified, to terminate this Agreement in its sole discretion at any time after the date of this Agreement. Any such termination shall be without liability of any party to any other party except that the provisions of Section 8, Section 10, Section 11, Section 17 and Section 18 hereof shall remain in full force and effect notwithstanding such termination.

(d)Unless earlier terminated pursuant to this Section 12, this Agreement shall automatically terminate upon the issuance and sale of all of the Placement Units through the Agent on the terms and subject to the conditions set forth herein; provided that the provisions of Section 8, Section 10, Section 11, Section 17 and Section 18 hereof shall remain in full force and effect notwithstanding such termination.

(e)This Agreement shall remain in full force and effect unless terminated pursuant to Sections 12(a), (b), (c), or (d) above or otherwise by mutual agreement of the parties; provided, however, that any such termination by mutual agreement shall in all cases be deemed to provide that Section 8, Section 10, Section 11, Section 17 and Section 18 shall remain in full force and effect.

(f)Any termination of this Agreement shall be effective on the date specified in such notice of termination; provided, however, that such termination shall not be effective until the close of business on the date of receipt of such notice by the Agent or the Partnership, as the case may be; provided, further, that any termination of this Agreement in accordance with the terms of Section 12(b) or (c) shall not be effective until the date that is ten days after the date of such written notice. If such termination shall occur prior to the Settlement Date for any sale of Placement Units, such Placement Units shall settle in accordance with the provisions of this Agreement.

(g)Subject to the additional limitations set forth in Section 8 of this Agreement, in the event of termination of this Agreement prior to the sale of any Placement Units, the Agent shall be entitled only to reimbursement of its out-of-pocket expenses actually incurred.

13.Notices. All notices or other communications required or permitted to be given by any party to any other party pursuant to the terms of this Agreement shall be in writing, unless otherwise specified, and if sent to the Agent, shall be delivered to:

 

JonesTrading Institutional Services LLC 

32133 Lindero Canyon Road, Suite 208

Westlake Village, CA 91361

Fax No.: (818) 879-5481

Attn: Trent McNair

Email: trentm@jonestrading.com

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With a copy to:

 

JonesTrading Institutional Services LLC

155 Federal Street, Suite 1002

Boston, MA 02110

Attn: Steve Chmielewski, Esq.

E-mail: steve@jonestrading.com

and

Duane Morris LLP

One Riverfront Plaza

1037 Raymond Boulevard

Newark, NJ 07102-5429

Attn: James T. Seery

E-mail: jtseery@duanemorris.com

and if to the Partnership, shall be delivered to:

 

America First Multifamily Investors, L.P.

c/o Burlington Capital LLC

1004 Farnam Street, Suite 400

Omaha, Nebraska 68102

Attn: Craig S. Allen

E-mail: callen@burlingtoncapital.com

 

with a copy to:

Barnes & Thornburg LLP

11 S. Meridian Street

Indianapolis, Indiana 46204

Attn: David P. Hooper, Esq.

E-mail: david.hooper@btlaw.com

 

Each party to this Agreement may change such address for notices by sending to the parties to this Agreement written notice of a new address for such purpose. Each such notice or other communication shall be deemed given (i) when delivered personally or by verifiable facsimile transmission (with an original to follow) on or before 4:30 p.m., New York City time, on a Business Day or, if such day is not a Business Day, on the next succeeding Business Day, (ii) on the next Business Day after timely delivery to a nationally-recognized overnight courier and (iii) on the Business Day actually received if deposited in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid).

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An electronic communication (“Electronic Notice”) shall be deemed written notice for purposes of this Section 13 if sent to the electronic mail address specified by the receiving party under separate cover. Electronic Notice shall be deemed received at the time the party sending Electronic Notice receives verification of receipt by the receiving party. Any party receiving Electronic Notice may request and shall be entitled to receive the notice on paper, in a nonelectronic form (“Nonelectronic Notice”) which shall be sent to the requesting party within ten (10) days of receipt of the written request for Nonelectronic Notice.

14.Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the Partnership and the Agent and their respective successors and the affiliates, controlling persons, officers, managers and directors referred to in Section 10 hereof. References to any of the parties contained in this Agreement shall be deemed to include the successors and permitted assigns of such party. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement. Neither party may assign its rights or obligations under this Agreement without the prior written consent of the other party; provided, however, that the Agent may assign its rights and obligations hereunder to a registered broker-dealer affiliate thereof without obtaining the Partnership’s consent.

15.Adjustments for Stock Splits. The parties acknowledge and agree that all share-related numbers contained in this Agreement shall be adjusted to take into account any unit split, unit distribution or dividend or similar event effected with respect to the Placement Units.

16.Entire Agreement; Amendment; Severability. This Agreement (including all schedules and exhibits attached hereto and Placement Notices issued pursuant hereto) constitutes the entire agreement and supersedes all other prior and contemporaneous agreements and undertakings, both written and oral, among the parties hereto with regard to the subject matter hereof. Neither this Agreement nor any term hereof may be amended except pursuant to a written instrument executed by the Partnership and the Agent. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable as written by a court of competent jurisdiction, then such provision shall be given full force and effect to the fullest possible extent that it is valid, legal and enforceable, and the remainder of the terms and provisions herein shall be construed as if such invalid, illegal or unenforceable term or provision was not contained herein, but only to the extent that giving effect to such provision and the remainder of the terms and provisions hereof shall be in accordance with the intent of the parties as reflected in this Agreement.

17.GOVERNING LAW AND TIME; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME. THE PARTNERSHIP HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

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18.CONSENT TO JURISDICTION. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH ANY TRANSACTION CONTEMPLATED HEREBY, 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 (CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.

19.Use of Information. The Agent may not use any information gained in connection with this Agreement and the transactions contemplated by this Agreement, including due diligence, to advise any party with respect to transactions not expressly approved by the Partnership.

20.Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed Agreement by one party to the other may be made by facsimile or other electronic transmission.

21.Effect of Headings. The section and Exhibit headings herein are for convenience only and shall not affect the construction hereof.

22.Permitted Free Writing Prospectuses.

The Partnership represents, warrants and agrees that, unless it obtains the prior consent of the Agent (which consent shall not be unreasonably withheld or delayed), and the Agent represents, warrants and agrees that, unless it obtains the prior consent of the Partnership, it has not made and will not make any offer relating to the Placement Units that would constitute an Issuer Free Writing Prospectus, or that would otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be filed with the Commission. Any such free writing prospectus consented to by the Agent or by the Partnership, as the case may be, is hereinafter referred to as a “Permitted Free Writing Prospectus.” The Partnership represents and warrants that it has treated and agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433, and has complied and will comply with the requirements of Rule 433 applicable to any Permitted Free Writing Prospectus, including timely filing with the Commission where required, legending and record keeping.

32

 

23.Absence of Fiduciary Relationship.

The Partnership acknowledges and agrees that:

(a)The Agent is acting solely as agent in connection with the public offering of the Placement Units and in connection with each transaction contemplated by this Agreement and the process leading to such transactions, and no fiduciary or advisory relationship between the Partnership or any of its respective affiliates, stockholders (or other equity holders), creditors or employees or any other party, on the one hand, and the Agent, on the other hand, has been or will be created in respect of any of the transactions contemplated by this Agreement, irrespective of whether or not the Agent has advised or is advising the Partnership on other matters, and the Agent has no obligation to the Partnership with respect to the transactions contemplated by this Agreement except the obligations expressly set forth in this Agreement;

(b)it is capable of evaluating and understanding, and understands and accepts, the terms, risks and conditions of the transactions contemplated by this Agreement;

(c)the Agent has not provided any legal, accounting, regulatory or tax advice with respect to the transactions contemplated by this Agreement and it has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate;

(d)it is aware that the Agent and its affiliates are engaged in a broad range of transactions which may involve interests that differ from those of the Partnership and the Agent has no obligation to disclose such interests and transactions to the Partnership by virtue of any fiduciary, advisory or agency relationship or otherwise; and

(e)it waives, to the fullest extent permitted by law, any claims it may have against the Agent for breach of fiduciary duty or alleged breach of fiduciary duty in connection with the sale of Placement Units under this Agreement and agrees that the Agent shall not have any liability (whether direct or indirect, in contract, tort or otherwise) to it in respect of such a fiduciary duty claim or to any person asserting a fiduciary duty claim on its behalf or in right of it or the Partnership, employees or creditors of Partnership, other than in respect of the Agent’s obligations under this Agreement and to keep information provided by the Partnership to the Agent and the Agent’s counsel confidential to the extent not otherwise publicly-available.

24.Definitions.

As used in this Agreement, the following terms have the respective meanings set forth below:

“Applicable Time” means (i) each Representation Date, (ii) the time of each sale of any Placement Units pursuant to this Agreement, and (iii) each Settlement Date.

“Business Day” shall mean any day on which the Exchange and commercial banks in the City of New York are open for business.

33

 

“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433, relating to the Placement Units that (1) is required to be filed with the Commission by the Partnership, (2) is a “road show” that is a “written communication” within the meaning of Rule 433(d)(8)(i) whether or not required to be filed with the Commission, or (3) is exempt from filing pursuant to Rule 433(d)(5)(i) because it contains a description of the Placement Units or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Partnership’s records pursuant to Rule 433(g) under the Securities Act Regulations.

“Rule 172,” “Rule 405,” “Rule 415,” “Rule 424,” “Rule 424(b),” “Rule 430B,” and “Rule 433” refer to such rules under the Securities Act Regulations.

“Trading Day” means any day on which BUCs are purchased and sold on the Exchange.

All references in this Agreement to financial statements and schedules and other information that is “contained,” “included” or “stated” in the Registration Statement or the Prospectus (and all other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information that is incorporated by reference in the Registration Statement or the Prospectus, as the case may be.

All references in this Agreement to the Registration Statement, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to EDGAR; all references in this Agreement to any Issuer Free Writing Prospectus (other than any Issuer Free Writing Prospectuses that, pursuant to Rule 433, are not required to be filed with the Commission) shall be deemed to include the copy thereof filed with the Commission pursuant to EDGAR; and all references in this Agreement to “supplements” to the Prospectus shall include, without limitation, any supplements, “wrappers” or similar materials prepared in connection with any offering, sale or private placement of any Placement Units by the Agent outside of the United States.

34

 

If the foregoing correctly sets forth the understanding between the Partnership and the Agent, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between the Partnership and the Agent.

 

	
 
	
Very truly yours,

	
 
	
 

	
 
	
AMERICA FIRST MULTIFAMILY INVESTORS, L.P.

	
 
	
 
	
 

	
 
	
By:
	
/s/ Craig S. Allen

	
 
	
Name:
	
Craig S. Allen

	
 
	
Title:
	
Chief Financial Officer

	
 
	
 
	
 

	
 
	
ACCEPTED as of the date first-above written:

	
 
	
 
	
 

	
 
	
JONESTRADING INSTITUTIONAL SERVICES LLC

	
 
	
 
	
 

	
 
	
By:
	
/s/ Trent McNair

	
 
	
Name:
	
Trent McNair

	
 
	
Title:
	
Chief Financial Officer

 

 

 

35

 

SCHEDULE 1

 

 

FORM OF PLACEMENT NOTICE

 

	
From:
	
America First Multifamily Investors, L.P.

	
To: 
	
JONESTRADING INSTITUTIONAL SERVICES LLC

	
Attention:
	
_____________________

	
Subject:
	
Placement Notice

Gentlemen:

Pursuant to the terms and subject to the conditions contained in the Capital on DemandTM Sales Agreement between America First Multifamily Investors, L.P. (the “Partnership”) and JonesTrading Institutional Services LLC (“Agent”), dated December  , 2017, the Partnership hereby requests that the Agent sell up to ____________ of the Partnership’s Beneficial Unit Certificates representing assigned limited partnership units (“BUCs”), at a minimum market price of $_______ per BUC, during the time period beginning [month, day, time] and ending [month, day, time].

36

 

SCHEDULE 2

 

Compensation

 

The Partnership shall pay to the Agent in cash, upon each sale of Placement Units pursuant to this Agreement, an amount equal to 2% of the gross proceeds from each sale of Placement Units.

 

37

SCHEDULE 3

 

Notice Parties

 

The Partnership

	
Chad L. Daffer
	
cd@ataxz.com

	
Craig Allen
	
callen@burlingtoncg.com

 

With a copy to (which shall not constitute notice):

 

	
David P. Hooper
	
dhooper@btlaw.com

 

The Agent

 

	
Moe Cohen 
	
moec@jonestrading.com 

	
Bryan Turley
	
bturley@jonestrading.com 

	
John D’Agostini 
	
johnd@jonestrading.com 

	
Ryan Gerety 
	
ryang@jonestrading.com 

 

With a copy to JTCM@jonestrading.com 

38

 

EXHIBIT 7(l)

 

Form of Representation Date Certificate

 

____________________, 20__

 

This Officers Certificate (this “Certificate”) is executed and delivered in connection with Section 7(l) of the Capital on DemandTM Sales Agreement (the “Agreement”), dated December   , 2017, and entered into between America First Multifamily Investors, L.P. (the “Partnership”) and JonesTrading Institutional Services LLC.  All capitalized terms used but not defined herein shall have the meanings given to such terms in the Agreement

 

The undersigned, a duly appointed and authorized officer of the Partnership, having made all necessary inquiries to establish the accuracy of the statements below and having been authorized by the Partnership to execute this certificate, hereby certifies as follows:

	
 
	
1.
	
As of the date of this Certificate, (i) the Registration Statement does 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 not misleading and (ii) neither the Registration Statement nor the Prospectus 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, not misleading and (iii) no event has occurred as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein not untrue or misleading.

	
 
	
2.
	
Each of the representations and warranties of the Partnership contained in the Agreement (A) to the extent such representations and warranties are subject to qualifications and exceptions contained therein relating to materiality or Material Adverse Effect, are true and correct on and as of the date hereof with the same force and effect as if expressly made on and as of the date hereof, except for those representations and warranties that speak solely as of a specific date and which were true and correct as of such date, and (B) to the extent such representations and warranties are not subject to any qualifications or exceptions, are true and correct in all material respects as of the date hereof as if made on and as of the date hereof with the same force and effect as if expressly made on and as of the date hereof, except for those representations and warranties that speak solely as of a specific date and which were so true and correct as of such date.

39

	
 
	
3.
	
Each of the covenants required to be performed by the Partnership in the Agreement on or prior to the date of the Agreement, this Representation Date, and each such other date as set forth in the Agreement, has been duly, timely and fully performed in all material respects and each condition required to be complied with by the Partnership on or prior to the date of the Agreement, this Representation Date, and each such other date as set forth in the Agreement or in the Waivers has been duly, timely and fully complied with in all material respects.

	
 
	
4.
	
Subsequent to the date of the most recent financial statements in the Prospectus, there has been no Material Adverse Effect.

	
 
	
5.
	
No stop order suspending the effectiveness of the Registration Statement or of any part thereof has been issued, and no proceedings for that purpose have been instituted or are pending or threatened by any securities or other governmental authority (including, without limitation, the Commission).

The undersigned has executed this Officer's Certificate as of the date first written above.

 

	
 
	
America First Multifamily Investors, L.P.

	
 
	
 
	
 

	
 
	
By:
	
 

	
 
	
Name:
	
 

	
 
	
Title:
	
 

 

40Blueprint

 

Exhibit 4.1

VISTAGEN THERAPEUTICS, INC.

 

Warrant To Purchase Common Stock

 

Warrant
No.:                                                                                                                                           

Number
of Shares of Common Stock: ______________

Date of
Issuance: December __, 2017 ("Issuance Date")

 

VistaGen
Therapeutics, Inc., a company organized under the laws of Nevada
(the "Company"), hereby
certifies that, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, [HOLDER], the
registered holder hereof or its permitted assigns (the
"Holder"), is entitled,
subject to the terms set forth below, to purchase from the Company,
at the Exercise Price (as defined below) then in effect, at any
time or times on or after the Issuance Date (the
“Initial Exercisability
Date”), but not after 11:59 p.m., New York time, on
the Expiration Date, (as defined below), ______________
(_____________)1 fully paid non-assessable shares of
Common Stock (as defined below), subject to adjustment as provided
herein (the
"Warrant Shares"). Except as
otherwise defined herein, capitalized terms in this Warrant to
Purchase Common Stock (including any Warrants to Purchase Common
Stock issued in exchange, transfer or replacement hereof, this
"Warrant"), shall have the
meanings set forth in Section 16. This Warrant is one of the
Warrants to purchase Common Stock (the "Warrants") issued pursuant to (i) that
certain Underwriting Agreement, dated as of December __, 2017 (the
"Subscription Date"), (ii)
the Company's Registration Statement on Form S-1 (File number
333-221009) (the "Registration
Statement") and (iii) the Company's prospectus dated as of
December __, 2017.

 

1. EXERCISE
OF WARRANT.

 

(a) Mechanics of Exercise. Subject
to the terms and conditions hereof (including, without limitation,
the limitations set forth in Section 1(f)), this Warrant may be
exercised by the Holder at any time or times on or after the
Initial Exercisability Date, in
whole or in part, by delivery (whether via facsimile, electronic
mail or otherwise) of a written notice, in the form attached hereto
as Exhibit A (the
"Exercise Notice"), of the
Holder's election to exercise this Warrant. Within one (1) Trading
Day following the delivery of the Exercise Notice, the Holder shall
make payment to the Company of an amount equal to the Exercise
Price in effect on the date of such exercise multiplied by the
number of Warrant Shares as to which this Warrant is being
exercised (the "Aggregate Exercise
Price") in cash by wire transfer of immediately available
funds or, if the provisions of Section 1(d) are applicable, by
notifying the Company that this Warrant is being exercised pursuant
to a Cashless Exercise (as defined in Section 1(d)). The Holder
shall not be required to deliver the original Warrant in order to
effect an exercise hereunder, nor shall any ink-original signature
or medallion guarantee (or other type of guarantee or notarization)
with respect to any Exercise Notice be required. Execution and
delivery of the Exercise Notice with respect to less than all of
the Warrant Shares shall have the same effect as cancellation of
the original Warrant and issuance of a new Warrant evidencing the
right to purchase the remaining number of Warrant Shares. On or
before the first (1st) Trading Day
following the date on which the Company has received the applicable
Exercise Notice, the Company shall transmit by facsimile or
electronic mail an acknowledgment of confirmation of receipt of the
Exercise Notice, in the form attached to the Exercise Notice, to
the Holder and the Company's transfer agent (the "Transfer Agent"). So long as the Holder
delivers the Aggregate Exercise Price (or notice of a Cashless
Exercise) on or prior to the first (1st) Trading Day following the
date on which the Exercise Notice has been delivered to the
Company, then on or prior to the earlier of (i) the second (2nd)
Trading Day and (ii) the number of Trading Days comprising the
Standard Settlement Period, in each case following the date on
which the Exercise Notice has been delivered to the Company, or, if
the Holder does not deliver the Aggregate Exercise Price (or notice
of a Cashless Exercise) on or prior to the first (1st) Trading Day
following the date on which the Exercise Notice has been delivered
to the Company, then on or prior to the first (1st) Trading Day
following the date on which the Aggregate Exercise Price (or notice
of a Cashless Exercise) is delivered (such earlier date, the
“Share Delivery
Date”),

 

____________

1 Insert the number of
shares of Common Stock equal to 100% of the number of shares of
Common Stock purchased under the Underwriting Agreement by such
Holder.

 

 
-1-

 

 

the
Company shall (X) provided that the Transfer Agent is participating
in The Depository Trust Company ("DTC") Fast Automated Securities Transfer
Program, credit such aggregate number of Warrant Shares to which
the Holder is entitled pursuant to such exercise to the Holder's or
its designee's balance account with DTC through its Deposit /
Withdrawal At Custodian system, or (Y) if the Transfer Agent is not
participating in the DTC Fast Automated Securities Transfer
Program, issue and dispatch by overnight courier to the address as
specified in the Exercise Notice, a certificate, registered in the
name of the Holder or its designee, for the number of Warrant
Shares to which the Holder is entitled pursuant to such exercise.
The Company shall be responsible for all fees and expenses of the
Transfer Agent and all fees and expenses with respect to the
issuance of Warrant Shares via DTC, if any, including without
limitation for same day processing. Upon delivery of the Exercise
Notice, the Holder shall be deemed for all corporate purposes to
have become the holder of record and beneficial owner of the
Warrant Shares with respect to which this Warrant has been
exercised, irrespective of the date such Warrant Shares are
credited to the Holder's DTC account or the date of delivery of the
certificates evidencing such Warrant Shares, as the case may be. If
this Warrant is physically delivered to the Company in connection
with any exercise pursuant to this Section 1(a) and the number of
Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an
exercise, then the Company shall as soon as practicable and in no
event later than three (3) Trading Days after any exercise and at
its own expense, issue and deliver to the Holder (or its designee)
a new Warrant (in accordance with Section 7(d)) representing the
right to purchase the number of Warrant Shares issuable immediately
prior to such exercise under this Warrant, less the number of
Warrant Shares with respect to which this Warrant is exercised. No
fractional Warrant Shares are to be issued upon the exercise of
this Warrant, but rather the number of Warrant Shares to be issued
shall be rounded to the nearest whole number. The Company shall pay
any and all transfer, stamp, issuance and similar taxes, costs and
expenses (including, without limitation, fees and expenses of the
Transfer Agent) which may be payable with respect to the issuance
and delivery of Warrant Shares upon exercise of this Warrant. The
Company's obligations to issue and deliver Warrant Shares in
accordance with the terms and subject to the conditions hereof are
absolute and unconditional, irrespective of any action or inaction
by the Holder to enforce the same, any waiver or consent with
respect to any provision hereof, the recovery of any judgment
against any Person or any action to enforce the same, or any
setoff, counterclaim, recoupment, limitation or termination;
provided,
however, that the
Company shall not be required to deliver Warrant Shares with
respect to an exercise prior to the Holder’s delivery of the
Aggregate Exercise Price (or notice of a Cashless Exercise) with
respect to such exercise.

 

(b) Exercise Price. For purposes of
this Warrant, "Exercise
Price" means $[____]2 per share, subject to adjustment as
provided herein.

 

(c) Company's Failure to Timely Deliver
Securities. If either (I) the Company shall fail for any
reason or for no reason to issue to the Holder on or prior to the
applicable Share Delivery Date, if (x) the Transfer Agent is not
participating in the DTC Fast Automated Securities Transfer
Program, a certificate for the number of shares of Common Stock to
which the Holder is entitled and register such Common Stock on the
Company's share register or (y) the Transfer Agent is participating
in the DTC Fast Automated Securities Transfer Program, to credit
the Holder's balance account with DTC, for such number of shares of
Common Stock to which the Holder is entitled upon the Holder's
exercise of this Warrant or (II) a registration statement (which
may be the Registration Statement) covering the issuance or resale
of the Warrant Shares that are the subject of the Exercise Notice
(the "Exercise Notice Warrant
Shares") is not available for the issuance or resale, as
applicable, of such Exercise Notice Warrant Shares and (x) the
Company fails to promptly, but in no event later than one (1)
Business Day after such registration statement becomes unavailable,
to so notify the Holder and (y) the Company is unable to deliver
the Exercise Notice Warrant Shares electronically without any
restrictive legend by crediting such aggregate number of Exercise
Notice Warrant Shares to the Holder’s or its designee’s
balance account with DTC through its Deposit / Withdrawal At
Custodian system (the event described in the immediately foregoing
clause (II) is hereinafter referred as a "Notice Failure" and together with the
event described in clause (I) above, an "Exercise Failure"), then, in addition to
all other remedies available to the Holder, if on or prior to the
applicable Share Delivery Date either (I) if the Transfer Agent is
not participating in the DTC Fast Automated Securities Transfer
Program, the Company shall fail to issue and deliver a certificate
to the Holder and register such shares of Common Stock on the
Company's share register or, if the Transfer Agent is participating
in the DTC Fast Automated

 

____________

2 Amount to be equal
to the pubic offering price.

 

-2-

 

 

Securities Transfer
Program, credit the Holder's balance account with DTC for the
number of shares of Common Stock to which the Holder is entitled
upon the Holder's exercise hereunder or pursuant to the Company's
obligation pursuant to clause (ii) below or (II) a Notice Failure
occurs, and if on or after such Trading Day the Holder purchases
(in an open market transaction or otherwise) Common Stock to
deliver in satisfaction of a sale by the Holder of shares of Common
Stock issuable upon such exercise that the Holder anticipated
receiving from the Company (a "Buy-In"), then the Company shall, within
three (3) Trading Days after the Holder's request and in the
Holder's discretion, either (i) pay cash to the Holder in an amount
equal to the Holder's total purchase price (including brokerage
commissions and other out-of-pocket expenses, if any) for the
shares of Common Stock so purchased (the "Buy-In Price"), at which point the
Company's obligation to deliver such certificate (and to issue such
shares of Common Stock) or credit such Holder's balance account
with DTC for such shares of Common Stock shall terminate, or (ii)
promptly honor its obligation to deliver to the Holder a
certificate or certificates representing such shares of Common
Stock or credit such Holder's balance account with DTC, as
applicable, and pay cash to the Holder in an amount equal to the
excess (if any) of the Buy-In Price over the product of (A) such
number of shares of Common Stock, times (B) any trading price of
the Common Stock selected by the Holder in writing as in effect at
any time during the period beginning on the applicable Exercise
Date and ending on the applicable Share Delivery Date. Nothing
shall limit the Holder's right to pursue any other remedies
available to it hereunder, at law or in equity, including, without
limitation, a decree of specific performance and/or injunctive
relief with respect to the Company's failure to timely deliver
certificates representing Warrant Shares (or to electronically
deliver such Warrant Shares) upon the exercise of this Warrant as
required pursuant to the terms hereof. While this Warrant is
outstanding, the Company shall cause its transfer agent to
participate in the DTC Fast Automated Securities Transfer Program.
In addition to the foregoing rights, (i) if the Company fails to
deliver the applicable number of Warrant Shares upon an exercise
pursuant to Section 1 by the applicable Share Delivery Date, then
the Holder shall have the right to rescind such exercise in whole
or in part and retain and/or have the Company return, as the case
may be, any portion of this Warrant that has not been exercised
pursuant to such Exercise Notice; provided that the rescission of
an exercise shall not affect the Company’s obligation to make
any payments that have accrued prior to the date of such notice
pursuant to this Section 1(c) or otherwise, and (ii) if a
registration statement (which may be the Registration Statement)
covering the issuance or resale of the Warrant Shares that are
subject to an Exercise Notice is not available for the issuance or
resale, as applicable, of such Exercise Notice Warrant Shares and
the Holder has submitted an Exercise Notice prior to receiving
notice of the non-availability of such registration statement and
the Company has not already delivered the Warrant Shares underlying
such Exercise Notice electronically without any restrictive legend
by crediting such aggregate number of Warrant Shares to which the
Holder is entitled pursuant to such exercise to the Holder’s
or its designee’s balance account with DTC through its
Deposit / Withdrawal At Custodian system, the Holder shall have the
option, by delivery of notice to the Company, to (x) rescind such
Exercise Notice in whole or in part and retain or have returned, as
the case may be, any portion of this Warrant that has not been
exercised pursuant to such Exercise Notice; provided that the
rescission of an Exercise Notice shall not affect the
Company’s obligation to make any payments that have accrued
prior to the date of such notice pursuant to this Section 1(c) or
otherwise, and/or (y) switch some or all of such Exercise Notice
from a cash exercise to a Cashless Exercise.

 

(d) Cashless Exercise.  Notwithstanding anything contained
herein to the contrary, if a registration statement (which may be
the Registration Statement) covering the issuance or resale of the
Exercise Notice Warrant Shares is not available for the issuance or
resale, as applicable, of such Exercise Notice Warrant Shares, the
Holder may, in its sole discretion, exercise this Warrant in whole
or in part and, in lieu of making the cash payment otherwise
contemplated to be made to the Company upon such exercise in
payment of the Aggregate Exercise Price, elect instead to receive
upon such exercise the "Net Number" of shares of Common Stock
determined according to the following formula (a "Cashless Exercise"):

 

Net
Number = (A x B) - (A x
C)

                                   
B

 

 

-3-

 

 

For
purposes of the foregoing formula:

 

A= the
total number of shares with respect to which this Warrant is then
being exercised.

 

B= as
applicable: (i) the Closing Sale Price of the Common Stock on the
Trading Day immediately preceding the date of the applicable
Exercise Notice if such Exercise Notice is (1) both executed and
delivered pursuant to Section 1(a) hereof on a day that is not a
Trading Day or (2) both executed and delivered pursuant to Section
1(a) hereof on a Trading Day prior to the opening of “regular
trading hours” (as defined in Rule 600(b)(64) of Regulation
NMS promulgated under the federal securities laws) on such Trading
Day, (ii) at the option of the Holder, either (y) the Weighted
Average Price on the Trading Day immediately preceding the date of
the applicable Notice of Exercise or (z) the Bid Price of the
Common Stock as of the time of the Holder’s execution of the
applicable Exercise Notice if such Exercise Notice is executed
during “regular trading hours” on a Trading Day and is
delivered within two (2) hours thereafter pursuant to Section 1(a)
hereof or (iii) the Closing Sale Price of the Common Stock on the
date of the applicable Exercise Notice if the date of such Exercise
Notice is a Trading Day and such Exercise Notice is both executed
and delivered pursuant to Section 1(a) hereof after the close of
“regular trading hours” on such Trading
Day.

 

C= the
Exercise Price then in effect for the applicable Warrant Shares at
the time of such exercise.

 

 

If Warrant Shares are issued in such a cashless exercise, the
Company acknowledges and agrees that in accordance with Section
3(a)(9) of the Securities Act of 1933, as amended, the Warrant
Shares shall take on the registered characteristics of the Warrants
being exercised, and the holding period of the Warrants being
exercised may be tacked on to the holding period of the Warrant
Shares. The Company agrees not to take any position contrary to
this Section 1(d).

 

(e) Disputes. In the case of a
dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall
promptly issue to the Holder the number of Warrant Shares that are
not disputed and resolve such dispute in accordance with Section
11.

 

(f) Beneficial
Ownership. Notwithstanding
anything to the contrary contained herein, the Company shall not
effect the exercise of any portion of this Warrant, and the Holder
shall not have the right to exercise any portion of this Warrant,
pursuant to the terms and conditions of this Warrant and any such
exercise shall be null and void and treated as if never made, to
the extent that after giving effect to such exercise, the Holder
together with the other Attribution Parties collectively would
beneficially own in excess of [4.99][9.99]% (the
"Maximum
Percentage") of the number
of shares of Common Stock outstanding immediately after giving effect to
such exercise. For purposes of the foregoing sentence, the
aggregate number of shares of Common Stock beneficially owned by the Holder and the other
Attribution Parties shall include the number of shares of
Common Stock held by the Holder and
all other Attribution Parties plus the number of shares of
Common Stock issuable upon exercise of
this Warrant with respect to which the determination of such
sentence is being made, but shall exclude the number of
shares of Common Stock which would be
issuable upon (A) exercise of the remaining, unexercised portion of
this Warrant beneficially owned by the Holder or any of the other
Attribution Parties and (B) exercise or conversion of the
unexercised or unconverted portion of any other securities of the
Company (including, without limitation, any convertible notes or
convertible preferred stock or warrants, including the other
Warrants) beneficially owned by the Holder or any other Attribution
Party subject to a limitation on conversion or exercise analogous
to the limitation contained in this Section 1(f). For purposes of
this Section 1(f), beneficial ownership shall be calculated in
accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended (the "1934 Act"). For purposes of this Warrant, in determining
the number of outstanding shares of Common Stock
the Holder may acquire upon the
exercise of this Warrant without exceeding the Maximum Percentage,
the Holder may rely on the number of outstanding shares of
Common Stock as reflected in (x) the
Company's most recent Annual Report on Form 10-K, Quarterly Report
on Form 10-Q and Current Reports on Form 8-K or other public filing
with the Securities and Exchange Commission (the
"SEC"), as the case may be,
(y) a more recent public announcement by the Company or (3) any
other written notice by the Company or
the Transfer Agent setting forth the number of

 

 

-4-

 

 

shares
of Common Stock outstanding
(the "Reported Outstanding Share
Number"). If the Company
receives an Exercise Notice from the Holder at a time when the
actual number of outstanding shares of Common Stock
is less than the Reported Outstanding
Share Number, the Company shall (i) notify the Holder in writing of
the number of shares of Common Stock then outstanding and, to the extent that such
Exercise Notice would otherwise cause the Holder's beneficial
ownership, as determined pursuant to this Section 1(f), to exceed
the Maximum Percentage, the Holder must notify the Company of a
reduced number of Warrant Shares to be purchased pursuant to such
Exercise Notice (the number of
shares by which such purchase is reduced, the "Reduction
Shares") and (ii) as soon as
reasonably practicable, the Company shall return to the Holder any
exercise price paid by the Holder for the Reduction Shares.
For any reason at any time, upon the written or oral request of the
Holder, the Company shall within one
(1) Business Day confirm orally and in writing or by electronic
mail to the Holder the number of shares of Common Stock
then outstanding. In any case, the
number of outstanding shares of Common Stock shall be determined after giving effect to the
conversion or exercise of securities of the Company, including this
Warrant, by the Holder and any other Attribution Party since the
date as of which the Reported Outstanding Share Number was
reported. In the event that the issuance of Common Stock
to the Holder upon exercise of this
Warrant results in the Holder and the other Attribution Parties
being deemed to beneficially own, in the aggregate, more than the
Maximum Percentage of the number of outstanding shares of
Common Stock (as determined under
Section 13(d) of the 1934 Act), the number of shares so issued by
which the Holder's and the other Attribution Parties' aggregate
beneficial ownership exceeds the Maximum Percentage (the
"Excess
Shares") shall be deemed null
and void and shall be cancelled ab initio, and the Holder shall not
have the power to vote or to transfer the Excess Shares. As soon as
reasonably practicable after the issuance of the Excess Shares has
been deemed null and void, the Company shall return to the Holder
the exercise price paid by the Holder for the Excess Shares.
Upon delivery of a written notice to the Company, the Holder may
from time to time increase or decrease the Maximum Percentage to
any other percentage not in excess of [4.99] [9.99]% as specified
in such notice; provided that (i) any such increase in the Maximum
Percentage will not be effective until the sixty-first
(61st) day
after such notice is delivered to the Company and (ii) any such
increase or decrease will apply only to the Holder and the other
Attribution Parties and not to any other holder of Warrants that is
not an Attribution Party of the Holder. For purposes of clarity,
the shares of Common Stock issuable pursuant to the terms of this
Warrant in excess of the Maximum Percentage shall not be deemed to
be beneficially owned by the Holder for any purpose including for
purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No
prior inability to exercise this Warrant pursuant to this paragraph
shall have any effect on the applicability of the provisions of
this paragraph with respect to any subsequent determination of
exercisability. The provisions of this
paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 1(f) to
the extent necessary to correct this paragraph or any portion of
this paragraph which may be defective or inconsistent with the
intended beneficial ownership limitation contained in this Section
1(f) or to make changes or supplements necessary or desirable to properly give effect to
such limitation. The limitation contained in this paragraph may not
be waived and shall apply to a successor holder of this
Warrant.

 

(g) Required Reserve Amount. 
So long as this Warrant remains outstanding, the Company shall at
all times keep reserved for issuance under this Warrant a number of
shares of Common Stock at least equal to 100% of the maximum number
of shares of Common Stock as shall be necessary to satisfy the
Company’s obligation to issue shares of Common Stock under
the Warrants then outstanding (without regard to any limitations on
exercise) (the "Required Reserve
Amount"); provided that at no time shall
the number of shares of Common Stock reserved pursuant to this
Section 1(g) be reduced other than in connection with any exercise
of Warrants or such other event covered by Section 2(c)
below.  The Required Reserve Amount (including, without
limitation, each increase in the number of shares so reserved)
shall be allocated pro rata among the holders of the Warrants based
on the number of shares of Common Stock issuable upon exercise of
Warrants held by each holder thereof on the Issuance Date (without
regard to any limitations on exercise) (the "Authorized Share Allocation"). In the
event that a holder shall sell or otherwise transfer any of such
holder’s Warrants, each transferee shall be allocated a pro
rata portion of such holder’s Authorized Share Allocation.
Any shares of Common Stock reserved and allocated to any Person
which ceases to hold any Warrants shall be allocated to the
remaining holders of Warrants, pro rata based on the number of
shares of Common Stock issuable upon exercise of the Warrants then
held by such holders thereof (without regard to any limitations on
exercise).

 

 

-5-

 

 

(h) Insufficient Authorized Shares.
If at any time while this Warrant remains outstanding the Company
does not have a sufficient number of authorized and unreserved
shares of Common Stock to satisfy its obligation to reserve for
issuance the Required Reserve Amount (an "Authorized Share Failure"), then the
Company shall promptly take all action reasonably necessary to
increase the Company's authorized shares of Common Stock to an
amount sufficient to allow the Company to reserve the Required
Reserve Amount for this Warrant then outstanding. Without limiting
the generality of the foregoing sentence, as soon as practicable
after the date of the occurrence of an Authorized Share Failure,
but in no event later than ninety (90) days after the occurrence of
such Authorized Share Failure, the Company shall hold a meeting of
its stockholders for the approval of an increase in the number of
authorized shares of Common Stock. In connection with such meeting,
the Company shall provide each stockholder with a proxy statement
and shall use its reasonable best efforts to solicit its
stockholders' approval of such increase in authorized shares of
Common Stock and to cause its Board of Directors to recommend to
the stockholders that they approve such proposal. Notwithstanding
the foregoing, if at any such time of an Authorized Share Failure,
the Company is able to obtain the written consent of a majority of
the shares of its issued and outstanding shares of Common Stock to
approve the increase in the number of authorized shares of Common
Stock, the Company may satisfy this obligation by obtaining such
consent and submitting for filing with the SEC an Information
Statement on Schedule 14C.

 

2. ADJUSTMENT OF EXERCISE PRICE AND
NUMBER OF WARRANT SHARES. The Exercise Price and the number
of Warrant Shares shall be adjusted from time to time as
follows:

 

(a) [Reserved]

 

(b) Adjustment Upon Subdivision or
Combination of Common Stock. If the Company at any time on
or after the Subscription Date subdivides (by any stock split,
stock dividend, recapitalization or otherwise) one or more classes
of its outstanding shares of Common Stock into a greater number of
shares, the Exercise Price in effect immediately prior to such
subdivision will be proportionately reduced and the number of
Warrant Shares will be proportionately increased. If the Company at
any time on or after the Subscription Date combines (by
combination, reverse stock split or otherwise) one or more classes
of its outstanding shares of Common Stock into a smaller number of
shares, the Exercise Price in effect immediately prior to such
combination will be proportionately increased and the number of
Warrant Shares will be proportionately decreased. Any adjustment
under this Section 2(c) shall become effective at the close of
business on the date the subdivision or combination becomes
effective.

 

(c) Other Events. If any event
occurs of the type contemplated by the provisions of this Section 2
but not expressly provided for by such provisions (including,
without limitation, the granting of stock appreciation rights,
phantom stock rights or other rights with equity features), then
the Company's Board of Directors will make an appropriate
adjustment in the Exercise Price and the number of Warrant Shares,
as mutually determined by the Company’s Board of Directors
and the Required Holders, so as to protect the rights of the
Holder; provided
that no such adjustment pursuant to this Section 2(d) will increase
the Exercise Price or decrease the number of Warrant Shares as
otherwise determined pursuant to this Section 2.

 

3. RIGHTS UPON DISTRIBUTION OF
ASSETS. In addition to any adjustments pursuant to Section 2
above, if, on or after the Subscription Date and on or prior to the
Expiration Date, the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets)
to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of
cash, stock or other securities, property, options, evidence of
indebtedness or any other assets by way of a dividend, spin off,
reclassification, corporate rearrangement, scheme of arrangement or
other similar transaction) (a "Distribution"), at any time after the
issuance of this Warrant, then, in each such case, the Holder shall
be entitled to participate in such Distribution to the same extent
that the Holder would have participated therein if the Holder had
held the number of shares of Common Stock acquirable upon complete
exercise of this Warrant (without regard to any limitations or
restrictions on exercise of this Warrant, including without
limitation, the Maximum Percentage) immediately before the date on
which a record is taken for such Distribution, or, if no such
record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the participation in such
Distribution (provided, however, that to the extent
that the Holder's right to participate in any such
Distribution

 

 

-6-

 

 

would
result in the Holder and the other Attribution Parties exceeding
the Maximum Percentage, then the Holder shall not be entitled to
participate in such Distribution to such extent (and shall not be
entitled to beneficial ownership of such shares of Common Stock as
a result of such Distribution (and beneficial ownership) to such
extent) and the portion of such Distribution shall be held in
abeyance for the benefit of the Holder until such time or times as
its right thereto would not result in the Holder and the other
Attribution Parties exceeding the Maximum Percentage, at which time
or times the Holder shall be granted such Distribution (and any
Distributions declared or made on such initial Distribution or on
any subsequent Distribution held similarly in abeyance) to the same
extent as if there had been no such limitation).

 

4. PURCHASE RIGHTS; FUNDAMENTAL
TRANSACTIONS.

 

(a) Purchase Rights. In addition to
any adjustments pursuant to Section 2 above, if at any time on or
after the Subscription Date and on or prior to the Expiration Date
the Company grants, issues or sells any Options, Convertible
Securities or rights to purchase stock, warrants, securities or
other property pro rata to the record holders of any class of
Common Stock but excluding shares of Common Stock deemed to have
been issued or sold by the Company in connection with any Excluded
Securities (the "Purchase Rights"), then the Holder will be
entitled to acquire, upon the terms applicable to such Purchase
Rights, the aggregate Purchase Rights which the Holder could have
acquired if the Holder had held the number of shares of Common
Stock acquirable upon complete exercise of this Warrant (without
regard to any limitations or restrictions on exercise of this
Warrant, including without limitation, the Maximum Percentage)
immediately before the date on which a record is taken for the
grant, issuance or sale of such Purchase Rights, or, if no such
record is taken, the date as of which the record holders of Common
Stock are to be determined for the grant, issuance or sale of such
Purchase Rights (provided, however, that to the extent
that the Holder's right to participate in any such Purchase Right
would result in the Holder and the other Attribution Parties
exceeding the Maximum Percentage, then the Holder shall not be
entitled to participate in such Purchase Right to such extent (and
shall not be entitled to beneficial ownership of such Common Stock
as a result of such Purchase Right (and beneficial ownership) to
such extent) and such Purchase Right to such extent shall be held
in abeyance for the benefit of the Holder until such time or times as its right thereto
would not result in the Holder and the other Attribution
Parties exceeding the Maximum
Percentage, at which time or times the Holder shall be granted such
right (and any Purchase Right granted, issued or sold on
such initial Purchase Right or on any subsequent Purchase Right to
be held similarly in abeyance) to the
same extent as if there had been no such
limitation).

 

(b) Fundamental Transaction. The
Company shall not enter into or be party to a Fundamental
Transaction unless the Successor Entity assumes in writing all of
the obligations of the Company under this Warrant in accordance
with the provisions of this Section 4(b), including agreements to
deliver to the Holder in exchange for this Warrant a security of
the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant,
including, without limitation, which is exercisable for a
corresponding number of shares of capital stock equivalent to the
shares of Common Stock acquirable and receivable upon exercise of
this Warrant (without regard to any limitations on the exercise of
this Warrant) prior to such Fundamental Transaction, and with an
exercise price which applies the exercise price hereunder to such
shares of capital stock (but taking into account the relative value
of the shares of Common Stock pursuant to such Fundamental
Transaction and the value of such shares of capital stock, such
adjustments to the number of shares of capital stock and such
exercise price being for the purpose of protecting the economic
value of this Warrant immediately prior to the consummation of such
Fundamental Transaction). Upon the consummation of each Fundamental
Transaction, the Successor Entity shall succeed to, and be
substituted for the Company (so that from and after the date of the
applicable Fundamental Transaction, the provisions of this Warrant
and the other Transaction Documents referring to the
“Company” shall refer instead to the Successor Entity),
and may exercise every right and power of the Company and shall
assume all of the obligations of the Company under this Warrant
with the same effect as if such Successor Entity had been named as
the Company herein. Upon consummation of each Fundamental
Transaction, the Successor Entity shall deliver to the Holder
confirmation that there shall be issued upon exercise of this
Warrant at any time after the consummation of the applicable
Fundamental Transaction, in lieu of the shares of Common Stock (or
other securities, cash, assets or other property (except such items
still issuable under Sections 3 and 4(a) above, which shall
continue to be receivable thereafter)) issuable upon the exercise
of this Warrant prior to the applicable Fundamental Transaction,
such shares of common stock (or its

 

 

-7-

 

 

equivalent) of the
Successor Entity (including its Parent Entity) which the Holder
would have been entitled to receive upon the happening of the
applicable Fundamental Transaction had this Warrant been exercised
immediately prior to the applicable Fundamental Transaction
(without regard to any limitations on the exercise of this
Warrant), as adjusted in accordance with the provisions of this
Warrant. Notwithstanding the foregoing, and without limiting
Section 1(f) hereof, the Holder may elect, at its sole option, by
delivery of written notice to the Company to waive this Section
4(b) to permit the Fundamental Transaction without the assumption
of this Warrant. In addition to and not in substitution for any
other rights hereunder, prior to the consummation of each
Fundamental Transaction pursuant to which holders of shares of
Common Stock are entitled to receive securities or other assets
with respect to or in exchange for shares of Common Stock (a
“Corporate
Event”), the Company shall make appropriate provision
to insure that the Holder will thereafter have the right to receive
upon an exercise of this Warrant at any time after the consummation
of the applicable Fundamental Transaction but prior to the
Expiration Date, in lieu of the shares of the Common Stock (or
other securities, cash, assets or other property (except such items
still issuable under Sections 3 and 4(a) above, which shall
continue to be receivable thereafter)) issuable upon the exercise
of the Warrant prior to such Fundamental Transaction, such shares
of stock, securities, cash, assets or any other property whatsoever
(including warrants or other purchase or subscription rights)
(collectively, the “Corporate
Event Consideration”) which the Holder would have been
entitled to receive upon the happening of the applicable
Fundamental Transaction had this Warrant been exercised immediately
prior to the applicable Fundamental Transaction (without regard to
any limitations on the exercise of this Warrant). The provision
made pursuant to the preceding sentence shall be in a form and
substance reasonably satisfactory to the Holder. The provisions of
this Section 4(b) shall apply similarly and equally to successive
Fundamental Transactions and Corporate Events. Notwithstanding the
foregoing, in the event of a Change of Control (other than a Change
of Control which was not approved by the Board of Directors, as to
which this right shall not apply), at the request of the Holder
delivered before the 30th day after such Change of Control, the
Company (or the Successor Entity) shall purchase this Warrant from
the Holder by paying to the Holder, within five Business Days after
such request (or, if later, on the effective date of the Change of
Control), an amount equal to the Black Scholes Value of the
remaining unexercised portion of this Warrant on the effective date
of such Change of Control, payable in cash; provided, that if the
applicable Change of Control was not approved by the Company's
Board of Directors, such amount shall be payable, at the option of
the Company in either (x) Common Stock (or corresponding Corporate
Event Consideration, as applicable) valued at the value of the
consideration received by the shareholders in such Change of
Control or (y) cash.

 

5. NONCIRCUMVENTION. The Company
hereby covenants and agrees that the Company will not, by amendment
of its Restated and Amended Articles of Incorporation or Bylaws, or
through any reorganization, transfer of assets, consolidation,
merger, scheme of arrangement, dissolution, issuance or sale of
securities, or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms of this Warrant,
and will at all times in good faith carry out all of the provisions
of this Warrant and take all action as may be required to protect
the rights of the Holder. Without limiting the generality of the
foregoing, the Company (i) shall not increase the par value of
any shares of Common Stock receivable upon the exercise of this
Warrant above the Exercise Price then in effect, (ii) shall
take all such actions as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and
nonassessable shares of Common Stock upon the exercise of this
Warrant, and (iii) shall, so long as any of the Warrants are
outstanding, take all action necessary to reserve and keep
available out of its authorized and unissued shares of Common
Stock, solely for the purpose of effecting the exercise of the
Warrants, the number of shares of Common Stock as shall from time
to time be necessary to effect the exercise of the Warrants then
outstanding (without regard to any limitations on
exercise).

 

6. WARRANT HOLDER NOT DEEMED A
STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person's capacity as a holder of
this Warrant, shall not be entitled to vote or receive dividends or
be deemed the holder of capital stock of the Company for any
purpose, nor shall anything contained in this Warrant be construed
to confer upon the Holder, solely in such Person's capacity as the
Holder of this Warrant, any of the rights of a stockholder of the
Company or any right to vote, give or withhold consent to any
corporate action (whether any reorganization, issue of stock,
reclassification of stock, consolidation, merger, conveyance or
otherwise), receive notice of meetings, receive dividends or
subscription rights, or otherwise, prior to the issuance to the
Holder of the Warrant Shares which such Person is then entitled to
receive upon the due exercise of this Warrant. In addition, nothing
contained in this Warrant shall be construed as imposing any
liabilities on the Holder to purchase any securities (upon exercise
of this Warrant or otherwise) or as a stockholder of the Company,
whether such liabilities are asserted by the Company or by
creditors of the Company. Notwithstanding this Section 6, the
Company shall provide the Holder with copies of the same notices
and other information given to the stockholders of the Company
generally, contemporaneously with the giving thereof to the
stockholders.

 

 

-8-

 

 

7. REISSUANCE OF
WARRANTS.

 

(a) Transfer of Warrant. If this
Warrant is to be transferred, the Holder shall surrender this
Warrant to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Warrant (in
accordance with Section 7(d)), registered as the Holder may
request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less than the total
number of Warrant Shares then underlying this Warrant is being
transferred, a new Warrant (in accordance with Section 7(d)) to the
Holder representing the right to purchase the number of Warrant
Shares not being transferred.

 

(b) Lost, Stolen or Mutilated
Warrant. Upon receipt by the Company of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant, and, in the case of loss, theft or
destruction, of any indemnification undertaking by the Holder to
the Company in customary form (but without the obligation to post a
bond) and, in the case of mutilation, upon surrender and
cancellation of this Warrant, the Company shall execute and deliver
to the Holder a new Warrant (in accordance with Section 7(d))
representing the right to purchase the Warrant Shares then
underlying this Warrant.

 

(c) Exchangeable for Multiple
Warrants. This Warrant is exchangeable, upon the surrender
hereof by the Holder at the principal office of the Company, for a
new Warrant or Warrants (in accordance with Section 7(d))
representing in the aggregate the right to purchase the number of
Warrant Shares then underlying this Warrant, and each such new
Warrant will represent the right to purchase such portion of such
Warrant Shares as is designated by the Holder at the time of such
surrender.

 

(d) Issuance of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to
the terms of this Warrant, such new Warrant (i) shall be of like
tenor with this Warrant, (ii) shall represent, as indicated on the
face of such new Warrant, the right to purchase the Warrant Shares
then underlying this Warrant (or in the case of a new Warrant being
issued pursuant to Section 7(a) or Section 7(c), the Warrant Shares
designated by the Holder which, when added to the number of shares
of Common Stock underlying the other new Warrants issued in
connection with such issuance, does not exceed the number of
Warrant Shares then underlying this Warrant), (iii) shall have an
issuance date, as indicated on the face of such new Warrant which
is the same as the Issuance Date, and (iv) shall have the same
rights and conditions as this Warrant.

 

8. NOTICES. Whenever notice is
required to be given under this Warrant, unless otherwise provided
herein, such notice shall be given in writing, (i) if delivered (a)
from within the domestic United States, by first-class registered
or certified airmail, or nationally recognized overnight express
courier, postage prepaid, electronic mail or by facsimile or (b)
from outside the United States, by International Federal Express,
electronic mail or facsimile, and (ii) will be deemed given (A) if
delivered by first-class registered or certified mail domestic,
three (3) Business Days after so mailed, (B) if delivered by
nationally recognized overnight carrier, one (1) Business Day after
so mailed, (C) if delivered by International Federal Express, two
(2) Business Days after so mailed and (D) on the date of
transmission, if delivered by electronic mail to each of the email
addresses specified in this Section 8 prior to 5:00 p.m. (New York
time) on a Trading Day, (E) the next Trading Day after the date of
transmission, if delivered by electronic mail to each of the email
addresses specified in this Section 8 on a day that is not a
Trading Day or later than 5:00 p.m. (New York time) on any Trading
Day and (E) if delivered by facsimile, upon electronic confirmation
of receipt of such facsimile, and will be delivered and addressed
as follows:

 

 

(i)          
if to the Company, to:

 

VistaGen
Therapeutics, Inc.

343
Allerton Ave.

South
San Francisco, CA 94090

Attention: Shawn
Singh

Facsimile:
888-482-2602

Email:
ssingh@vistagen.com

 

(ii) if
to the Holder, at such address or other contact information
delivered by the Holder to Company or as is on the books and
records of the Company.

 

 

-9-

 

 

The
Company shall provide the Holder with prompt written notice of all
actions taken pursuant to this Warrant, including in reasonable
detail a description of such action and the reason therefor.
Without limiting the generality of the foregoing, the Company will
give written notice to the Holder (i) immediately upon any
adjustment of the Exercise Price, setting forth in reasonable
detail, and certifying, the calculation of such adjustment and (ii)
at least fifteen (15) days prior to the date on which the Company
closes its books or takes a record (A) with respect to any dividend
or distribution upon the shares of Common Stock, (B) with respect
to any grants, issuances or sales of any Options, Convertible
Securities or rights to purchase stock, warrants, securities or
other property to holders of shares of Common Stock or (C) for
determining rights to vote with respect to any Fundamental
Transaction, dissolution or liquidation; provided in each case that such
information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder. It is
expressly understood and agreed that the time of exercise specified
by the Holder in each Exercise Notice shall be definitive and may
not be disputed or challenged by the Company.

 

9. AMENDMENT AND WAIVER. Except as
otherwise provided herein, the provisions of this Warrant may be
amended or waived and the Company may take any action herein
prohibited, or omit to perform any act herein required to be
performed by it, only if the Company has obtained the written
consent of the Holder.

 

10. GOVERNING LAW; JURISDICTION; JURY
TRIAL. This Warrant shall be governed by and construed and
enforced in accordance with, and all questions concerning the
construction, validity, interpretation and performance of this
Warrant shall be governed by, the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. The Company hereby
irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or
discussed herein, 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. The
Company 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 the Company at the address
set forth in Section 8(i) above or such other address as the
Company subsequently delivers to the Holder 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. Nothing contained herein shall be deemed or operate to
preclude the Holder from bringing suit or taking other legal action
against the Company in any other jurisdiction to collect on the
Company's obligations to the Holder, to realize on any collateral
or any other security for such obligations, or to enforce a
judgment or other court ruling in favor of the Holder. THE COMPANY 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 WITH OR
ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED
HEREBY.

 

11. VARIABLE RATE TRANSACTIONS.
Notwithstanding anything to the contrary contained herein, from and
after the Subscription Date and on or prior to the Expiration Date,
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, Convertible Securities or Options (or
a combination thereof) involving a Variable Rate Transaction. As
used herein, "Variable Rate
Transaction" means a transaction in which the Company or any
of its Subsidiaries (i) issues or sells any debt or equity security
that are convertible into, exchangeable or exercisable for, or
include the right to receive additional shares of Common Stock
either (A) at a conversion price, exercise price or exchange rate
or other price that is based upon and/or varies with the trading
prices of or quotations for the shares of Common Stock at any time
after the initial issuance of such debt or equity securities., 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 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 or (ii) enters into
any agreement, including, but not limited to an equity line of
credit or at-the-market offering, whereby the Company or any of its
Subsidiaries may issue securities at a future determined price. For
the avoidance of doubt, the issuance of a Common Stock Equivalent
with a fixed exercise or conversion price with a standard price
only full ratchet or weighted average anti-dilution provision shall
not be considered to be a Variable Rate Transaction.

 

 

-10-

 

 

12. DISPUTE RESOLUTION. In the case
of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall
submit the disputed determinations or arithmetic calculations via
facsimile or electronic mail within two (2) Business Days of
receipt of the Exercise Notice or other event giving rise to such
dispute, as the case may be, to the Holder. If the Holder and the
Company are unable to agree upon such determination or calculation
of the Exercise Price or the Warrant Shares within three (3)
Business Days of such disputed determination or arithmetic
calculation being submitted to the Holder, then the Company shall,
within two (2) Business Days submit via facsimile or electronic
mail (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and
approved by the Holder or (b) the disputed arithmetic calculation
of the Warrant Shares to the Company's independent, outside
accountant. The Company shall cause at its expense the investment
bank or the accountant, as the case may be, to perform the
determinations or calculations and notify the Company and the
Holder of the results no later than ten (10) Business Days from the
time it receives the disputed determinations or calculations. Such
investment bank's or accountant's determination or calculation, as
the case may be, shall be binding upon all parties absent
demonstrable error.

 

13. REMEDIES, OTHER OBLIGATIONS, BREACHES
AND INJUNCTIVE RELIEF. The remedies provided in this Warrant
shall be cumulative and in addition to all other remedies available
under this Warrant and any other Transaction Documents, at law or
in equity (including a decree of specific performance and/or other
injunctive relief), and nothing herein shall limit the right of the
Holder to pursue actual damages for any failure by the Company to
comply with the terms of this Warrant. The Company acknowledges
that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder 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 or threatened breach, the holder of
this Warrant 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.

 

14. TRANSFER.  This Warrant
and the Warrant Shares may be offered for sale, sold, transferred,
pledged or assigned without the consent of the
Company.

 

15. SEVERABILITY; CONSTRUCTION;
HEADINGS.  If any provision of this Warrant is
prohibited by law or otherwise determined to be invalid or
unenforceable by a court of competent jurisdiction, the provision
that would otherwise be prohibited, invalid or unenforceable shall
be deemed amended to apply to the broadest extent that it would be
valid and enforceable, and the invalidity or unenforceability of
such provision shall not affect the validity of the remaining
provisions of this Warrant so long as this Warrant as so modified
continues to express, without material change, the original
intentions of the parties as to the subject matter hereof and the
prohibited nature, invalidity or unenforceability of the
provision(s) in question does not substantially impair the
respective expectations or reciprocal obligations of the parties or
the practical realization of the benefits that would otherwise be
conferred upon the parties. The parties will endeavor in good faith
negotiations to replace the prohibited, invalid or unenforceable
provision(s) with a valid provision(s), the effect of which comes
as close as possible to that of the prohibited, invalid or
unenforceable provision(s). This Warrant shall be deemed to be
jointly drafted by the Company and the Holder and shall not be
construed against any Person as the drafter hereof. The headings of
this Warrant are for convenience of reference and shall not form
part of, or affect the interpretation of, this
Warrant.

 

16. DISCLOSURE. Upon receipt or
delivery by the Company of any notice in accordance with the terms
of this Warrant, unless the Company has in good faith determined
that the matters relating to such notice do not constitute
material, nonpublic information relating to the Company or its
subsidiaries, the Company shall contemporaneously with any such
receipt or delivery publicly disclose such material, nonpublic
information on a Current Report on Form 8-K or otherwise. In the
event that the Company believes that a notice contains material,
nonpublic information relating to the Company or its subsidiaries,
the Company so shall indicate to such Holder contemporaneously with
delivery of such notice, and in the absence of any such indication,
the Holder shall be allowed to presume that all matters relating to
such notice do not constitute material, nonpublic information
relating to the Company or its subsidiaries.

 

 

-11-

 

 

17. CERTAIN DEFINITIONS. For
purposes of this Warrant, the following terms shall have the
following meanings:

 

(a) "Affiliate" means, with respect to any
Person, any other Person that directly or indirectly controls, is
controlled by, or is under common control with, such Person, it
being understood for purposes of this definition that "control" of
a Person means the power directly or indirectly either to vote 10%
or more of the stock having ordinary voting power for the election
of directors of such Person or direct or cause the direction of the
management and policies of such Person whether by contract or
otherwise.

 

(b) "Approved Stock Plan" means the
Company’s 2016 Amended and Restated Stock Incentive Plan and
any employee benefit plan which has been approved by a majority of
the disinterested members of the Board of Directors of the Company,
in each case pursuant to which the Company’s securities may
be issued to any employee, officer or director for services
provided to the Company.

 

(c)
"Attribution Parties" means,
collectively, the following Persons and entities: (i) any
investment vehicle, including, any funds, feeder funds or managed
accounts, currently, or from time to time after the Subscription
Date, directly or indirectly managed or advised by the Holder's
investment manager or any of its Affiliates or principals, (ii) any
direct or indirect Affiliates of the Holder or any of the
foregoing, (iii) any Person acting or who could be deemed to be
acting as a Group together with the Holder or any of the foregoing
and (iv) any other Persons whose beneficial ownership of the
Company's Common Stock would or could be aggregated with the
Holder's and the other Attribution Parties for purposes of Section
13(d) of the 1934 Act. For clarity, the purpose of the foregoing is
to subject collectively the Holder and all other Attribution
Parties to the Maximum Percentage.

 

(d)  “Bid
Price” means, for any security as of the particular
time of determination, the bid price for such security on the
Principal Market as reported by Bloomberg as of such time of
determination, or, if the Principal Market is not the principal
securities exchange or trading market for such security, the bid
price of such security on the principal securities exchange or
trading market where such security is listed or traded as reported
by Bloomberg as of such time of determination, or if the foregoing
does not apply, the bid price of such security in the
over-the-counter market on the electronic bulletin board for such
security as reported by Bloomberg as of such time of determination,
or, if no bid price is reported for such security by Bloomberg as
of such time of determination, the average of the bid prices of any
market makers for such security as reported in the “pink
sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC)
as of such time of determination. If the Bid Price cannot be
calculated for a security as of the particular time of
determination on any of the foregoing bases, the Bid Price of such
security as of such time of determination shall be the fair market
value as mutually determined by the Company and the Holder. If the
Company and the Holder are unable to agree upon the fair market
value of such security, then such dispute shall be resolved in
accordance with the procedures in Section 11. All such
determinations shall be appropriately adjusted for any stock
dividend, stock split, stock combination or other similar
transaction during such period.

 

(e) "Black Scholes Value" means the value of
this Warrant based on the Black-Scholes Option Pricing Model
obtained from the "OV" function on Bloomberg determined as of the
day immediately following the first public announcement of the
applicable Fundamental Transaction, or, if the Fundamental
Transaction is not publicly announced, the date the Fundamental
Transaction is consummated, for pricing purposes and reflecting (i)
a risk-free interest rate corresponding to the U.S. Treasury rate
for a period equal to the remaining term of this Warrant as of such
date of request, (ii) an expected volatility equal to the greater
of 100% and the 100-day volatility obtained from the HVT function
on Bloomberg as of the day immediately following the public
announcement of the applicable Fundamental Transaction, or, if the
Fundamental Transaction is not publicly announced, the date the
Fundamental Transaction is consummated, (iii) the underlying price
per share used in such calculation shall be the highest Weighted
Average Price during the five (5) Trading Days prior to the closing
of the Fundamental Transaction, (iv) a zero cost of borrow and (v)
a 360 day annualization factor.

 

 

-12-

 

 

(f) "Bloomberg" means Bloomberg Financial
Markets.

 

(g) "Business Day" means any day other than
Saturday, Sunday or other day on which commercial banks in The City
of New York are authorized or required by law to remain
closed.

 

(h) “Change of Control” means any
Fundamental Transaction other than (i) any reorganization,
recapitalization or reclassification of the Common Stock in which
holders of the Company’s voting power immediately prior to
such reorganization, recapitalization or reclassification continue
after such reorganization, recapitalization or reclassification to
hold publicly traded securities and, directly or indirectly, are,
in all material respect, the holders of the voting power of the
surviving entity (or entities with the authority or voting power to
elect the members of the board of directors (or their equivalent if
other than a corporation) of such entity or entities) after such
reorganization, recapitalization or reclassification, (ii) pursuant
to a migratory merger effected solely for the purpose of changing
the jurisdiction of incorporation of the Company or (iii) a merger
in connection with a bona fide acquisition by the Company of any
Person in which (x) the gross consideration paid, directly or
indirectly, by the Company in such acquisition is not greater than
20% of the Company’s market capitalization as calculated on
the date of the consummation of such merger and (y) such merger
does not contemplate a change to the identity of a majority of the
board of directors of the Company. Notwithstanding anything herein
to the contrary, any transaction or series of transaction that,
directly or indirectly, results in the Company or the Successor
Entity not having Common Stock or common stock, as applicable,
registered under the 1934 Act and listed on an Eligible Market
shall be deemed a Change of Control.

 

(i) "Closing Bid Price" and "Closing Sale Price" means, for any
security as of any date, the last closing bid price and last
closing trade price, respectively, for such security on the
Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not
designate the closing bid price or the closing trade price, as the
case may be, then the last bid price or the last trade price,
respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not
the principal securities exchange or trading market for such
security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as
reported by Bloomberg, or if the foregoing do not apply, the last
closing bid price or last trade price, respectively, of such
security in the over-the-counter market on the electronic bulletin
board for such security as reported by Bloomberg, or, if no closing
bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask
prices, respectively, of any market makers for such security as
reported in the OTC Link or "pink sheets" by OTC Markets Group Inc.
(formerly Pink OTC Markets Inc.). If the Closing Bid Price or the
Closing Sale Price cannot be calculated for a security on a
particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such
security on such date shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the
Holder are unable to agree upon the fair market value of such
security, then such dispute shall be resolved pursuant to Section
11. All such determinations to be appropriately adjusted for any
stock dividend, stock split, stock combination, reclassification or
other similar transaction during the applicable calculation
period.

 

(j) "Common Stock" means (i) the
Company's Common Stock, par value $0.001 per share, and
(ii) any capital stock into which such Common Stock shall have
been changed or any capital stock resulting from a reclassification
of such Common Stock.

 

(k) "Convertible Securities" means any stock
or securities (other than Options) directly or indirectly
convertible into or exercisable or exchangeable for shares of
Common Stock.

 

(l) "Eligible Market" means The NASDAQ
Capital Market, the NYSE American LLC, The NASDAQ Global Select
Market, The NASDAQ Global Market or The New York Stock Exchange,
Inc.

 

 

-13-

 

 

(m)  "Excluded Securities" means any shares of
Common Stock issued or issuable, or deemed issued or issuable
pursuant to Section 2(a): (i) in connection with any Approved Stock
Plan, (ii) upon exercise of the Warrants; provided, that the terms
of such Warrants are not amended, modified or changed on or after
the Subscription Date, (iii) upon conversion, exercise or exchange
of any Options or Convertible Securities which are outstanding on
the day immediately preceding the Subscription Date.; provided, that the terms
of such Options or Convertible Securities are not amended, modified
or changed on or after the Subscription Date and (iv) issued as
payment of regular dividends pursuant to the terms of the
Company’s Series B Preferred Stock;  provided, that the
terms of the Series B Preferred Stock are not amended, modified or
changed on or after the Subscription Date.

 

 

(n) "Expiration Date" means the date sixty
(60) months after the Initial Exercisability Date or, if such date falls on a day other
than a Business Day or on which trading does not take place on the
Principal Market (a "Holiday"), the next day that is not a
Holiday.

 

(o) "Fundamental Transaction" means (A) that
the Company shall, directly or indirectly, including through
subsidiaries, Affiliates or otherwise, in one or more related
transactions, (i) consolidate or merge with or into (whether or not
the Company is the surviving corporation) another Subject Entity,
or (ii) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company or
any of its "significant subsidiaries" (as defined in Rule 1-02 of
Regulation S-X) to one or more Subject Entities, or (iii) make, or
allow one or more Subject Entities to make, or allow the Company to
be subject to or have its shares of Common Stock be subject to or
party to one or more Subject Entities making, a purchase, tender or
exchange offer that is accepted by the holders of at least either
(x) 50% of the outstanding shares of Common Stock, (y) 50% of the
outstanding shares of Common Stock calculated as if any shares of
Common Stock held by all Subject Entities making or party to, or
Affiliated with any Subject Entities making or party to, such
purchase, tender or exchange offer were not outstanding; or (z)
such number of shares of Common Stock such that all Subject
Entities making or party to, or Affiliated with any Subject Entity
making or party to, such purchase, tender or exchange offer, become
collectively the beneficial owners (as defined in Rule 13d-3 under
the 1934 Act) of at least 50% of the outstanding shares of Common
Stock, or (iv) consummate a stock purchase agreement or other
business combination (including, without limitation, a
reorganization, recapitalization, spin-off or scheme of
arrangement) with one or more Subject Entities whereby all such
Subject Entities, individually or in the aggregate, acquire, either
(x) at least 50% of the outstanding shares of Common Stock, (y) at
least 50% of the outstanding shares of Common Stock calculated as
if any shares of Common Stock held by all the Subject Entities
making or party to, or Affiliated with any Subject Entity making or
party to, such stock purchase agreement or other business
combination were not outstanding; or (z) such number of shares of
Common Stock such that the Subject Entities become collectively the
beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of
at least 50% of the outstanding shares of Common Stock, or (v)
reorganize, recapitalize or reclassify its shares of Common Stock.,
(B) that the Company shall, directly or indirectly, including
through subsidiaries, Affiliates or otherwise, in one or more
related transactions, allow any Subject Entity individually or the
Subject Entities in the aggregate to be or become the "beneficial
owner" (as defined in Rule 13d-3 under the 1934 Act), directly or
indirectly, whether through acquisition, purchase, assignment,
conveyance, tender, tender offer, exchange, reduction in
outstanding shares of Common Stock, merger, consolidation, business
combination, reorganization, recapitalization, spin-off, scheme of
arrangement, reorganization, recapitalization or reclassification
or otherwise in any manner whatsoever, of either (x) at least 50%
of the aggregate ordinary voting power represented by issued and
outstanding shares of Common Stock, (y) at least 50% of the
aggregate ordinary voting power represented by issued and
outstanding shares of Common Stock not held by all such Subject
Entities as of the Subscription Date calculated as if any shares of
Common Stock held by all such Subject Entities were not
outstanding, or (z) a percentage of the aggregate ordinary voting
power represented by issued and outstanding shares of Common Stock
or other equity securities of the Company sufficient to allow such
Subject Entities to effect a statutory short form merger or other
transaction requiring other stockholders of the Company to
surrender their Common Stock without approval of the stockholders
of the Company or (C) directly or indirectly, including through
subsidiaries, Affiliates or otherwise, in one or more related
transactions, the issuance of or the entering into any other
instrument or transaction structured in a manner to circumvent, or
that circumvents, the intent of this definition in which case this
definition shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this definition to the
extent necessary to correct this definition or any portion of this
definition which may be defective or inconsistent with the intended
treatment of such instrument or transaction.

 

 

-14-

 

 

(p) "Group" means a "group" as that term is
used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5
thereunder.

 

(q) "Option Value" means the value of an
Option based on the Black-Scholes Option Pricing model obtained
from the "OV" function on Bloomberg determined as of the day of the
most recent Closing Sale Price of the Common Stock prior to the
public announcement of the pricing of the applicable Option (or, if
the pricing is not publicly announced, on the most recent Closing
Sale Price of the Common Stock prior to the pricing of the
applicable Option) and reflecting (i) a risk-free interest rate
corresponding to the U.S. Treasury rate for a period equal to the
remaining term of the applicable Option as of the applicable date
of determination, (ii) an expected volatility equal to the greater
of 100% and the 100 day volatility obtained from the HVT function
on Bloomberg as of (A) the Trading Day immediately following the
first public announcement of the pricing of the transaction that
includes the applicable Option if such pricing is publicly
announced or (B) the Trading Day immediately following the issuance
of the applicable Option if the pricing of such transaction is not
publicly announced, (iii) an underlying price per share equal to
the most recent Closing Sale Price of the Common Stock prior to the
public announcement of the pricing of the applicable Option (or, if
the pricing is not publicly announced, on the most recent Closing
Sale Price of the Common Stock prior to the pricing of the
applicable Option), (iv) a zero cost of borrow and (v) a 360-day
annualization factor.

 

(r) "Options" means any rights, warrants or
options to subscribe for or purchase shares of Common Stock or
Convertible Securities.

 

(s) "Parent Entity" of a Person means an
entity that, directly or indirectly, controls the applicable
Person, including such entity whose common stock or equivalent
equity security is quoted or listed on an Eligible Market (or, if
so elected by the Holder, any other market, exchange or quotation
system), or, if there is more than one such Person or such entity,
the Person or such entity designated by the Holder or in the
absence of such designation, such Person or entity with the largest
public market capitalization as of the date of consummation of the
Fundamental Transaction.

 

(t) "Person" means an individual, a limited
liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization, any other entity and a
government or any department or agency thereof.

 

(u) "Principal Market" means The NASDAQ
Capital Market.

 

(v) "Required Holders" means the holders of
the Warrants representing at least a majority of the shares of
Common Stock underlying the Warrants then outstanding.

 

(w) “Standard Settlement Period”
means the standard settlement period, expressed in a number of
Trading Days, for the Company’s primary trading market or
quotation system with respect to the Common Stock that is in effect
on the date of receipt of an applicable Conversion
Notice.

 

(x) "Subject Entity" means any Person,
Persons or Group or any Affiliate or associate of any such Person,
Persons or Group.

 

(y) "Successor Entity" means one or more
Person or Persons (or, if so elected by the Holder, the Company or
Parent Entity) formed by, resulting from or surviving any
Fundamental Transaction or one or more Person or Persons (or, if so
elected by the Holder, the Company or the Parent Entity) with which
such Fundamental Transaction shall have been entered
into.

 

 

-15-

 

 

(z) "Trading Day" means any day on which the
Common Stock is traded on the Principal Market, or, if the
Principal Market is not the principal trading market for the Common
Stock, then on the principal securities exchange or securities
market on which the Common Stock is then traded.

 

(aa) “Transaction
Documents” means any agreement entered into by and
between the Company and the Holder, as applicable.

 

(bb) "Weighted
Average Price" means, for any security as of any date, the
dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New
York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00
p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported
by Bloomberg through its "Volume at Price" function or, if the
foregoing does not apply, the dollar volume-weighted average price
of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at
9:30:01 a.m., New York time (or such other time as such market
publicly announces is the official open of trading), and ending at
4:00:00 p.m., New York time (or such other time as such market
publicly announces is the official close of trading), as reported
by Bloomberg, or, if no dollar volume-weighted average price is
reported for such security by Bloomberg for such hours, the average
of the highest Closing Bid Price and the lowest closing ask price
of any of the market makers for such security as reported in the
OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink
OTC Markets Inc.). If the Weighted Average Price cannot be
calculated for a security on a particular date on any of the
foregoing bases, the Weighted Average Price of such security on
such date shall be the fair market value as mutually determined by
the Company and the Holder. If the Company and the Holder are
unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 11 with the term
"Weighted Average Price" being substituted for the term "Exercise
Price." All such determinations shall be appropriately adjusted for
any stock dividend, stock split, stock combination,
reclassification or other similar transaction during the applicable
calculation period.

 

[Signature Page Follows]

-16-

 

 

 

IN WITNESS WHEREOF, the Company has
caused this Warrant to Purchase Common Stock to be duly executed as
of the Issuance Date set out above.

 

 

VISTAGEN
THERAPEUTICS, INC.

 

 

By:___________________________

Name:

Title:

 

 

 

-17-

 

  EXHIBIT A

 

EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE
THIS

WARRANT TO PURCHASE COMMON STOCK

 

VISTAGEN THERAPEUTICS, INC.

The
undersigned holder hereby exercises the right to purchase
_________________ of the shares of Common Stock ("Warrant Shares") of VistaGen
Therapeutics, Inc., a company organized under the laws of Nevada
(the "Company"), evidenced
by the attached Warrant to Purchase Common Stock (the "Warrant"). Capitalized terms used herein
and not otherwise defined shall have the respective meanings set
forth in the Warrant.

 

1. Form
of Exercise Price. The Holder intends that payment of the Exercise
Price shall be made as:

 

____________ 

a "Cash Exercise" with respect to
_________________ Warrant Shares; and/or

 

____________ 

a "Cashless Exercise" with
respect to _______________ Warrant Shares.

 

2.
Payment of Exercise Price. In the event that the holder has elected
a Cash Exercise with respect to some or all of the Warrant Shares
to be issued pursuant hereto, the holder shall pay the Aggregate
Exercise Price in the sum of $___________________ to the Company in
accordance with the terms of the Warrant.

 

3.
Delivery of Warrant Shares. The Company shall deliver to the holder
__________ Warrant Shares in accordance with the terms of the
Warrant.

 

4.
Variable Price Securities. By checking the box in this Item 4, the
holder elects to exercise the Warrant by substituting the Variable
Price for the Exercise Price pursuant to Section 2(d) of the
Warrant, which Variable Price equals $___________ per share.
☐

 

 

 

 

Date:
_______________ __, ______

 

 

 

   Name
of Registered Holder

 

 

By:           

Name:

Title:

 

 

 

-18-

 

ACKNOWLEDGMENT

 

 

The
Company hereby acknowledges this Exercise Notice and hereby directs
Computershare Trust Company, N.A. to issue the above indicated
number of shares of Common Stock on or prior to the applicable
Share Delivery Date.

 

VISTAGEN
THERAPEUTICS, INC.

 

 

 

By:________________________________

Name:

Title:

 

 

 

 

-19-

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