Document:

uamy_ex101

 

Exhibit 10.1

SECURITIES
PURCHASE AGREEMENT

 

This
Securities Purchase Agreement (this “Agreement”) is dated as
of February 10, 2021, between United
States Antimony Corporation, a Montana corporation (the
“Company”), and each
purchaser identified on the signature pages hereto (each, including
its successors and assigns, a “Purchaser” and
collectively, the “Purchasers”).

 

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant
to an effective registration statement under the Securities Act of
1933, as amended (the “Securities Act”) as to
the Shares, the Company desires to issue and sell to each
Purchaser, and each Purchaser, severally and not jointly, desires
to purchase from the Company, securities of the Company as more
fully described in this Agreement.

 

NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration the
receipt and adequacy of which are hereby acknowledged, the Company
and each Purchaser agree as follows:

 

ARTICLE I.

DEFINITIONS

 

1.1  Definitions.
In addition to the terms defined elsewhere in this Agreement, for
all purposes of this Agreement, the following terms have the
meanings set forth in this Section 1.1:

 

“Acquiring
Person” shall have the
meaning ascribed to such term in Section 4.5.

 

“Action” shall have the
meaning ascribed to such term in Section 3.1(j).

 

“Affiliate” means any
Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common
control with a Person as such terms are used in and construed under
Rule 405 under the Securities Act.

 

“Board of Directors” means
the board of directors of the Company.

 

“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; provided, however, for clarification,
commercial banks shall not be deemed to be authorized or required
by law to remain closed due to “stay at home”,
“shelter-in-place”, “non-essential
employee”  or any other similar orders or restrictions
or the closure of any physical branch locations at the direction of
any governmental authority so long as the electronic funds transfer
systems (including for wire transfers) of commercial banks in The
City of New York generally are open for use by customers on such
day.

 

“Closing” means the
closing of the purchase and sale of the Securities pursuant to
Section 2.1.

 

“Closing Date” means the
Trading Day on which all of the Transaction Documents have been
executed and delivered by the applicable parties thereto, and all
conditions precedent to (i) the Purchasers’ obligations to
pay the Subscription Amount and (ii) the Company’s
obligations to deliver the Securities, in each case, have been
satisfied or waived, but in no event later than the second
(2nd)
Trading Day following the date hereof.

 

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

 

“Common Stock” means the
common stock of the Company, par value $0.01 per share, and any
other class of securities into which such securities may hereafter
be reclassified or changed.

 

“Common Stock Equivalents”
means any securities of the Company or the Subsidiaries which would
entitle the holder thereof to acquire at any time Common Stock,
including, without limitation, any debt, preferred stock, right,
option, warrant or other instrument that is at any time convertible
into or exercisable or exchangeable for, or otherwise entitles the
holder thereof to receive, Common Stock.

 

 

 

 

“Company Counsel” means
Pryor Cashman LLP, with offices located at 7 Times Square, 40th
Floor, New York, New York
10036.

 

“Disclosure Schedules”
means the Disclosure Schedules of the Company delivered
concurrently herewith.

 

“Disclosure Time” means,
(i) if this Agreement is signed on a day that is not a Trading Day
or after 9:00 a.m. (New York City time) and before midnight (New
York City time) on any Trading Day, 9:01 a.m. (New York City time)
on the Trading Day immediately following the date hereof, unless
otherwise instructed as to an earlier time by the Placement Agent,
and (ii) if this Agreement is signed between midnight (New York
City time) and 9:00 a.m. (New York City time) on any Trading Day,
no later than 9:01 a.m. (New York City time) on the date hereof,
unless otherwise instructed as to an earlier time by the Placement
Agent.

 

“EGS” means Ellenoff
Grossman & Schole LLP, with offices located at 1345 Avenue of
the Americas, New York, New York 10105-0302.

 

 “Evaluation
Date” shall have the meaning ascribed to such term in
Section 3.1(s).

 

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

 

“Exempt Issuance” means
the issuance of (a) shares of Common Stock or options to employees,
officers or directors of the Company pursuant to any stock or
option plan duly adopted for such purpose, by a majority of the
non-employee members of the Board of Directors or a majority of the
members of a committee of non-employee directors established for
such purpose for services rendered to the Company, (b) securities
upon the exercise or exchange of or conversion of any Securities
issued hereunder, warrants to the Placement Agent in connection
with the transactions pursuant to this Agreement, if any, and any
securities upon exercise of warrants to the Placement Agent, if
any, and/or other securities exercisable or exchangeable for or
convertible into shares of Common Stock issued and outstanding on
the date of this Agreement, provided that such securities have not
been amended since the date of this Agreement to increase the
number of such securities or to decrease the exercise price,
exchange price or conversion price of such securities (other than
in connection with stock splits or combinations) or to extend the
term of such securities, and (c) securities issued pursuant to
acquisitions or strategic transactions approved by a majority of
the disinterested directors of the Company, provided that such
securities are issued as “restricted securities” (as
defined in Rule 144) and carry no registration rights that require
or permit the filing of any registration statement in connection
therewith during the prohibition period in Section 4.11(a) herein,
and provided that any such issuance shall only be to a Person (or
to the equityholders of a Person) which is, itself or through its
subsidiaries, an operating company or an owner of an asset in a
business synergistic with the business of the Company and shall
provide to the Company additional benefits in addition to the
investment of funds, but shall not include a transaction in which
the Company is issuing securities primarily for the purpose of
raising capital or to an entity whose primary business is investing
in securities.

 

“FCPA” means the Foreign
Corrupt Practices Act of 1977, as amended.

 

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

 

“Indebtedness” shall have
the meaning ascribed to such term in Section 3.1(aa).

 

“Intellectual Property
Rights” shall have the meaning ascribed to such term
in Section 3.1(p).

 

“Legend Removal Date”
shall have the meaning ascribed to such term in Section
4.1(c).

 

“Liens” means a lien,
charge, pledge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.

 

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

 

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

 

 

 

 

 “Per
Share Purchase Price” equals $1.30, subject to
adjustment for reverse and forward stock splits, stock dividends,
stock combinations and other similar transactions of the Common
Stock that occur after the date of this Agreement.

 

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

 

 “Placement
Agent” means Roth Capital Partners, LLC.

 

 “Proceeding”
means an action, claim, suit, investigation or proceeding
(including, without limitation, an informal investigation or
partial proceeding, such as a deposition), whether commenced or
threatened.

 

“Prospectus” means the
final prospectus filed for the Registration Statement.

 

“Prospectus Supplement”
means the supplement to the Prospectus complying with Rule 424(b)
of the Securities Act that is filed with the Commission and
delivered by the Company to each Purchaser at the
Closing.

 

“Purchaser Party” shall
have the meaning ascribed to such term in Section 4.8.

 

“Registration Statement”
means the effective registration statement with Commission File No.
333-252193 which registers the sale of the Shares to the
Purchasers.

 

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

 

“Rule 144” means Rule 144
promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended or interpreted from time to time, or any
similar rule or regulation hereafter adopted by the Commission
having substantially the same purpose and effect as such
Rule.

 

“Rule 424” means Rule 424
promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended or interpreted from time to time, or any
similar rule or regulation hereafter adopted by the Commission
having substantially the same purpose and effect as such
Rule.

 

 “SEC
Reports” shall have the meaning ascribed to such term
in Section 3.1(h).

 

“Securities” means the
Shares.

 

“Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.

 

“Shares” means the shares
of Common Stock issued or issuable to each Purchaser pursuant to
this Agreement.

 

“Short Sales” means all
“short sales” as defined in Rule 200 of Regulation SHO
under the Exchange Act (but shall not
be deemed to include locating and/or borrowing shares of Common Stock). 

 

 “Subscription
Amount” means, as to each Purchaser, the aggregate
amount to be paid for Shares purchased hereunder as specified below
such Purchaser’s name on the signature page of this Agreement
and next to the heading “Subscription Amount,” in
United States dollars and in immediately available
funds.

 

“Subsidiary” means any
subsidiary of the Company as set forth on Schedule 3.1(a), and shall,
where applicable, also include any direct or indirect subsidiary of
the Company formed or acquired after the date hereof.

 

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

 

 

 

 

“Trading Market” means any
of the following markets or exchanges on which the Common Stock is
listed or quoted for trading on the date in question: the NYSE
American, the Nasdaq Capital Market, the Nasdaq Global Market, the
Nasdaq Global Select Market or the New York Stock Exchange (or any
successors to any of the foregoing).

 

“Transaction Documents”
means this Agreement and all exhibits and schedules thereto and
hereto and any other documents or agreements executed in connection
with the transactions contemplated hereunder.

 

“Transfer Agent” means
Direct Transfer, LLC, the current transfer agent of the Company,
with a mailing address of One Glenwood Avenue, Suite 1001, Raleigh,
North Carolina 27603 and a facsimile number of (646) 225-7274, and
any successor transfer agent of the Company.

 

 “Variable
Rate Transaction” shall have the meaning ascribed to
such term in Section 4.11(b).

 

“VWAP” means, for any
date, the price determined by the first of the following clauses
that applies: (a) if the Common Stock is then listed or quoted on a
Trading Market, the daily volume weighted average price of the
Common Stock for such date (or the nearest preceding date) on the
Trading Market on which the Common Stock is then listed or quoted
as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)),
(b)  if OTCQB or OTCQX is not a Trading Market, the volume
weighted average price of the Common Stock for such date (or the
nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the
Common Stock is not then listed or quoted for trading on OTCQB or
OTCQX and if prices for the Common Stock are then reported in The
Pink Open Market (or a similar organization or agency succeeding to
its functions of reporting prices), the most recent bid price per
share of the Common Stock so reported, or (d) in all other
cases, the fair market value of a share of Common Stock as
determined by an independent appraiser selected in good faith by
the Purchasers of a majority in interest of the Securities then
outstanding and reasonably acceptable to the Company, the fees and
expenses of which shall be paid by the Company.

 

ARTICLE II.

PURCHASE
AND SALE

 

2.1 Closing.
On the Closing Date, upon the terms and subject to the conditions
set forth herein, substantially concurrent with the execution and
delivery of this Agreement by the parties hereto, the Company
agrees to sell, and the Purchasers, severally and not jointly,
agree to purchase, up to an aggregate of $14,287,000 of Shares.
Each Purchaser’s Subscription Amount as set forth on the
signature page hereto executed by such Purchaser shall be made
available for “Delivery Versus Payment” settlement with
the Company or its designee. The Company shall deliver to each
Purchaser its respective Shares, and the Company and each Purchaser
shall deliver the other items set forth in Section 2.2 deliverable
at the Closing. Upon satisfaction of the covenants and conditions
set forth in Sections 2.2 and 2.3, the Closing shall occur at the
offices of EGS or such other location as the parties shall mutually
agree. Notwithstanding anything herein to the contrary, if at any
time on or after the time of execution of this Agreement by the
Company and an applicable Purchaser, through, and including the
time immediately prior to the Closing (the
“Pre-Settlement
Period”), if such
Purchaser sells to any Person all, or any portion, of any Common
Stock to be issued hereunder to such Purchaser at the Closing
(collectively, the “Pre-Settlement
Shares”), such Purchaser
shall, automatically hereunder (without any additional required
actions by such Purchaser or the Company), be deemed to be
unconditionally bound to purchase, and the Company shall be deemed
unconditionally bound to sell, such Pre-Settlement Shares to such
Purchaser at the Closing; provided, that the Company shall not be
required to deliver any Pre-Settlement Shares to such Purchaser
prior to the Company’s receipt of the Subscription Amount for
such Pre-Settlement Shares hereunder; provided, further, that the
Company hereby acknowledges and agrees that the forgoing shall not
constitute a representation or covenant by such Purchaser as to
whether or not such Purchaser will elect to sell any Pre-Settlement
Shares during the Pre-Settlement Period.  The decision to sell
any shares of Common Stock will be made in the sole discretion of
such Purchaser from time to time, including during the
Pre-Settlement Period. Unless otherwise directed by the Placement
Agent, settlement of the Shares shall occur via “Delivery
Versus Payment” (“DVP”) (i.e., on the Closing Date, the Company shall
issue the Shares registered in the Purchasers’ names and
addresses and released by the Transfer Agent directly to the
account(s) at the Placement Agent identified by each Purchaser;
upon receipt of such Shares, the Placement Agent shall promptly
electronically deliver such Shares to the applicable Purchaser, and
payment therefor shall be made by the Placement Agent (or its
clearing firm) by wire transfer to the Company). Notwithstanding
anything to the contrary herein and a Purchaser’s
Subscription Amount set forth on the signature pages attached
hereto, the number of Shares purchased by a Purchaser (and its
Affiliates) hereunder shall not, when aggregated with all other
shares of Common Stock owned by such Purchaser (and its Affiliates)
at such time, result in such Purchaser beneficially owning (as
determined in accordance with Section 13(d) of the Exchange Act) in
excess of 9.9% of the then issued and outstanding Common Stock
outstanding at the Closing (the “Beneficial Ownership
Maximum”), and such
Purchaser’s Subscription Amount, to the extent it would
otherwise exceed the Beneficial Ownership Maximum immediately prior
to the Closing, shall be conditioned upon the issuance of Shares at
the Closing to the other Purchasers signatory hereto. To the extent
that a Purchaser’s beneficial ownership of the Shares would
otherwise be deemed to exceed the Beneficial Ownership Maximum,
such Purchaser’s Subscription Amount shall automatically be
reduced as necessary in order to comply with this
paragraph.

 

2.2 Deliveries.

 

(a)            On
or prior to the Closing Date (except as indicated below), the
Company shall deliver or cause to be delivered to each Purchaser
the following:

 

(i) this Agreement duly
executed by the Company;

 

(ii) a
legal opinion of Company Counsel, in the form of Exhibit C attached
hereto;

 

(iii) subject
to the third to last sentence of Section 2.1, the Company shall
have provided each Purchaser with the Company’s wire
instructions, on Company letterhead and executed by the Chief
Executive Officer or Chief Financial Officer;

 

 

 

 

(iv) subject
to the third to last sentence of Section 2.1, a copy of the
irrevocable instructions to the Transfer Agent instructing the
Transfer Agent to deliver on an expedited basis via The Depository
Trust Company Deposit or Withdrawal at Custodian system
(“DWAC”) Shares equal to
such Purchaser’s Subscription Amount divided by the Per Share
Purchase Price, registered in the name of such Purchaser;
and

 

(v) the Prospectus and
Prospectus Supplement (which may be delivered in accordance with
Rule 172 under the Securities Act).

 

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

 

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

 

(ii) such
Purchaser’s Subscription Amount, which shall be made
available for “Delivery Versus Payment” settlement with
the Company or its designee.

 

2.3 Closing
Conditions.

 

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

 

(i) the accuracy in all
material respects (or, to the extent representations or warranties
are qualified by materiality or Material Adverse Effect, in all
respects) on the Closing Date of the representations and warranties
of the Purchasers contained herein (unless as of a specific date
therein in which case they shall be accurate as of such
date);

 

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

 

(iii) the
delivery by each Purchaser of the items set forth in Section 2.2(b)
of this Agreement.

 

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

 

(i) the accuracy in all
material respects (or, to the extent representations or warranties
are qualified by materiality or Material Adverse Effect, in all
respects) when made and on the Closing Date of the representations
and warranties of the Company contained herein (unless as of a
specific date therein in which case they shall be accurate as of
such date);

 

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

 

(iii) the
delivery by the Company of the items set forth in Section 2.2(a) of
this Agreement;

 

(iv) there
shall have been no Material Adverse Effect with respect to the
Company since the date hereof; and

 

(v) from the date
hereof to the Closing Date, trading in the Common Stock shall not
have been suspended by the Commission or the Company’s
principal Trading Market, and, at any time prior to the Closing
Date, trading in securities generally as reported by Bloomberg L.P.
shall not have been suspended or limited, or minimum prices shall
not have been established on securities whose trades are reported
by such service, or on any Trading Market, nor shall a banking
moratorium have been declared either by the United States or New
York State authorities nor shall there have occurred any material
outbreak or escalation of hostilities or other national or
international calamity of such magnitude in its effect on, or any
material adverse change in, any financial market which, in each
case, in the reasonable judgment of such Purchaser, makes it
impracticable or inadvisable to purchase the Securities at the
Closing.

 

 

 

 

ARTICLE III.

REPRESENTATIONS
AND WARRANTIES

 

3.1 Representations
and Warranties of the Company.
Except as set forth in the Disclosure Schedules, which Disclosure
Schedules shall be deemed a part hereof and shall qualify any
representation or otherwise made herein to the extent of the
disclosure contained in the corresponding section of the Disclosure
Schedules, the Company hereby makes the following representations
and warranties to each Purchaser:

 

(a)            Subsidiaries.
All of the direct and indirect subsidiaries of the Company are set
forth on Schedule
3.1(a). The Company owns,
directly or indirectly, all of the capital stock or other equity
interests of each Subsidiary free and clear of any Liens, and all
of the issued and outstanding shares of capital stock of each
Subsidiary are validly issued and are fully paid, non-assessable
and free of preemptive and similar rights to subscribe for or
purchase securities. If the Company has no subsidiaries, all other
references to the Subsidiaries or any of them in the Transaction
Documents shall be disregarded.

 

(b)            Organization
and Qualification. The Company and each of the Subsidiaries
is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of
its incorporation or organization, with the requisite power and
authority to own and use its properties and assets and to carry on
its business as currently conducted. Neither the Company nor any
Subsidiary is in violation nor default of any of the provisions of
its respective certificate or articles of incorporation, bylaws or
other organizational or charter documents. Each of the Company and
the Subsidiaries is duly qualified to conduct business and is in
good standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the
case may be, could not have or reasonably be expected to result in:
(i) a material adverse effect on the legality, validity or
enforceability of any Transaction Document, (ii) a material adverse
effect on the results of operations, assets, business, prospects or
condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or (iii) a material adverse effect
on the Company’s ability to perform in any material respect
on a timely basis its obligations under any Transaction Document
(any of (i), (ii) or (iii), a “Material Adverse Effect”)
and no Proceeding has been instituted in any such jurisdiction
revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.

 

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

 

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

 

(e) Filings, Consents and
Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or
make any filing or registration with, any court or other federal,
state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the
Company of the Transaction Documents, other than: (i) the filings
required pursuant to Section 4.4 of this Agreement, (ii) the filing
with the Commission of the Prospectus Supplement, (iii)
application(s) to each applicable Trading Market for the listing of
the Shares for trading thereon in the time and manner required
thereby, and (iv) the filing of Form D with the Commission and such
filings as are required to be made under applicable state
securities laws (collectively, the “Required
Approvals”).

 

(f) Issuance of the Securities;
Registration. The Securities are duly authorized and, when
issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by the Company.
The Company has reserved from its duly authorized capital stock the
maximum number of shares of Common Stock issuable pursuant to this
Agreement. The Company has prepared and filed the Registration
Statement in conformity with the requirements of the Securities
Act, which became effective on January 27, 2021 (the
“Effective
Date”), including the Prospectus, and such amendments
and supplements thereto as may have been required to the date of
this Agreement. The Registration Statement is effective under the
Securities Act and no stop order preventing or suspending the
effectiveness of the Registration Statement or suspending or
preventing the use of the Prospectus has been issued by the
Commission and no proceedings for that purpose have been instituted
or, to the knowledge of the Company, are threatened by the
Commission. The Company, if required by the rules and regulations
of the Commission, shall file the Prospectus with the Commission
pursuant to Rule 424(b). At the time the Registration Statement and
any amendments thereto became effective, at the date of this
Agreement and at the Closing Date, the Registration Statement and
any amendments thereto conformed and will conform in all material
respects to the requirements of the Securities Act and did not and
will not contain any 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 the Prospectus
and any amendments or supplements thereto, at the time the
Prospectus or any amendment or supplement thereto was issued and at
the Closing Date, conformed and will conform in all material
respects to the requirements of the Securities Act and did not and
will not contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. The Company was at the time of the filing of
the Registration Statement eligible to use Form S-3. The Company is
eligible to use Form S-3 under the Securities Act and it meets the
transaction requirements with respect to the aggregate market value
of securities being sold pursuant to this offering and during the
twelve (12) months prior to this offering, as set forth in General
Instruction I.B.6 of Form S-3.

 

 

 

 

(g) Capitalization. The
capitalization of the Company as of the date hereof is as set forth
on Schedule 3.1(g),
which Schedule
3.1(g) shall also include the number of shares of Common
Stock owned beneficially, and of record, by Affiliates of the
Company as of the date hereof. The Company has not issued any
capital stock since its most recently
filed periodic report under the Exchange Act, other than
pursuant to the exercise of employee stock options under the
Company’s stock option plans, the issuance of shares of
Common Stock to employees pursuant to the Company’s employee
stock purchase plans and pursuant to the conversion and/or exercise
of Common Stock Equivalents outstanding as of the date of the most
recently filed periodic report under the Exchange Act. No Person
has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the
transactions contemplated by the Transaction Documents. Except as a
result of the purchase and sale of the Securities, there are no
outstanding options, warrants, scrip rights to subscribe to, calls
or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exercisable
or exchangeable for, or giving any Person any right to subscribe
for or acquire, any shares of Common Stock or the capital stock of
any Subsidiary, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may
become bound to issue additional shares of Common Stock or Common
Stock Equivalents or capital stock of any Subsidiary. The issuance
and sale of the Securities will not obligate the Company or any
Subsidiary to issue shares of Common Stock or other securities to
any Person (other than the Purchasers). There are no outstanding
securities or instruments of the Company or any Subsidiary with any
provision that adjusts the exercise, conversion, exchange or reset
price of such security or instrument upon an issuance of securities
by the Company or any Subsidiary. There are no outstanding
securities or instruments of the Company or any Subsidiary that
contain any redemption or similar provisions, and there are no
contracts, commitments, understandings or arrangements by which the
Company or any Subsidiary is or may become bound to redeem a
security of the Company or such Subsidiary. The Company does not
have any stock appreciation rights or “phantom stock”
plans or agreements or any similar plan or agreement. All of the
outstanding shares of capital stock of the Company are duly
authorized, validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws,
and none of such outstanding shares was issued in violation of any
preemptive rights or similar rights to subscribe for or purchase
securities. No further approval or authorization of any
stockholder, the Board of Directors or others is required for the
issuance and sale of the Securities. There are no stockholders
agreements, voting agreements or other similar agreements with
respect to the Company’s capital stock to which the Company
is a party or, to the knowledge of the Company, between or among
any of the Company’s stockholders.

 

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

 

(i) Material Changes; Undisclosed Events,
Liabilities or Developments. Since the date of the latest
audited financial statements included within the SEC Reports,
except as set forth on Schedule 3.1(i), (i) there has
been no event, occurrence or development that has had or that could
reasonably be expected to result in a Material Adverse Effect, (ii)
the Company has not incurred any liabilities (contingent or
otherwise) other than (A) trade payables and accrued expenses
incurred in the ordinary course of business consistent with past
practice and (B) liabilities not required to be reflected in the
Company’s financial statements pursuant to GAAP or disclosed
in filings made with the Commission, (iii) the Company has not
altered its method of accounting, (iv) the Company has not declared
or made any dividend or distribution of cash or other property to
its stockholders or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock and (v) the
Company has not issued any equity securities to any officer,
director or Affiliate, except pursuant to existing Company stock
option plans. The Company does not have pending before the
Commission any request for confidential treatment of information.
Except for the issuance of the Securities contemplated by this
Agreement or as set forth on Schedule 3.1(i), no event,
liability, fact, circumstance, occurrence or development has
occurred or exists or is reasonably expected to occur or exist with
respect to the Company or its Subsidiaries or their respective
businesses, prospects, properties, operations, assets or financial
condition that would be required to be disclosed by the Company
under applicable securities laws at the time this representation is
made or deemed made that has not been publicly disclosed at least 1
Trading Day prior to the date that this representation is
made.

 

(j) Litigation. Except as set forth
on Schedule 3.1(j),
there is no action, suit, inquiry, notice of violation, proceeding
or investigation pending or, to the knowledge of the Company,
threatened against or affecting the Company, any Subsidiary or any
of their respective properties before or by any court, arbitrator,
governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) (collectively, an
“Action”). None of the
Actions set forth on Schedule 3.1(j), (i) adversely
affects or challenges the legality, validity or enforceability of
any of the Transaction Documents or the Securities or (ii) could,
if there were an unfavorable decision, have or reasonably be
expected to result in a Material Adverse Effect. Neither the
Company nor any Subsidiary, nor any director or officer thereof, is
or has been the subject of any Action involving a claim of
violation of or liability under federal or state securities laws or
a claim of breach of fiduciary duty. There has not been, and to the
knowledge of the Company, there is not pending or contemplated, any
investigation by the Commission involving the Company or any
current or former director or officer of the Company. The
Commission has not issued any stop order or other order suspending
the effectiveness of any registration statement filed by the
Company or any Subsidiary under the Exchange Act or the Securities
Act.

 

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

 

 

 

 

(l) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or
in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a
default by the Company or any Subsidiary under), nor has the
Company or any Subsidiary received notice of a claim that it is in
default under or that it is in violation of, any indenture, loan or
credit agreement or any other agreement or instrument to which it
is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is
in violation of any judgment, decree or order of any court,
arbitrator or other governmental authority or (iii) is or has been
in violation of any statute, rule, ordinance or regulation of any
governmental authority, including without limitation all foreign,
federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and
safety and employment and labor matters, except in each case as
could not have or reasonably be expected to result in a Material
Adverse Effect.

 

(m) Environmental
Laws.                                                       The
Company and its Subsidiaries (i) are in compliance with all
federal, state, local and foreign laws relating to pollution or
protection of human health or the environment (including ambient
air, surface water, groundwater, land surface or subsurface
strata), including laws relating to emissions, discharges, releases
or threatened releases of chemicals, pollutants, contaminants, or
toxic or hazardous substances or wastes (collectively,
“Hazardous
Materials”) into the environment, or otherwise
relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous
Materials, as well as all authorizations, codes, decrees, demands,
or demand letters, injunctions, judgments, licenses, notices or
notice letters, orders, permits, plans or regulations, issued,
entered, promulgated or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required
of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms
and conditions of any such permit, license or approval where in
each clause (i), (ii) and (iii), the failure to so comply could be
reasonably expected to have, individually or in the aggregate, a
Material Adverse Effect.

 

(n) Regulatory Permits. The Company
and the Subsidiaries possess all certificates, authorizations and
permits issued by the appropriate federal, state, local or foreign
regulatory authorities necessary to conduct their respective
businesses as described in the SEC Reports, except where the
failure to possess such permits could not reasonably be expected to
result in a Material Adverse Effect (“Material Permits”), and
neither the Company nor any Subsidiary has received any notice of
proceedings relating to the revocation or modification of any
Material Permit.

 

(o) Title to Assets. The Company
and the Subsidiaries have good and marketable title in fee simple
to all real property owned by them and good and marketable title in
all personal property owned by them that is material to the
business of the Company and the Subsidiaries, in each case free and
clear of all Liens, except for (i) Liens as do not materially
affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the
Company and the Subsidiaries and (ii) Liens for the payment of
federal, state or other taxes, for which appropriate reserves have
been made therefor in accordance with GAAP and, the payment of
which is neither delinquent nor subject to penalties. Any real
property and facilities held under lease by the Company and the
Subsidiaries are held by them under valid, subsisting and
enforceable leases with which the Company and the Subsidiaries are
in compliance.

 

(p) Intellectual Property. The
Company and the Subsidiaries have, or have rights to use, all
patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights,
licenses and other intellectual property rights and similar rights
necessary or required for use in connection with their respective
businesses as described in the SEC Reports and which the failure to
so have could have a Material Adverse Effect (collectively, the
“Intellectual
Property Rights”). None of, and neither the Company
nor any Subsidiary has received a notice (written or otherwise)
that any of, the Intellectual Property Rights has expired,
terminated or been abandoned, or is expected to expire or terminate
or be abandoned, within two (2) years from the date of this
Agreement. Neither the Company nor any Subsidiary has received,
since the date of the latest audited financial statements included
within the SEC Reports, a written notice of a claim or otherwise
has any knowledge that the Intellectual Property Rights violate or
infringe upon the rights of any Person, except as could not have or
reasonably be expected to not have a Material Adverse Effect. To
the knowledge of the Company, all such Intellectual Property Rights
are enforceable and there is no existing infringement by another
Person of any of the Intellectual Property Rights. The Company and
its Subsidiaries have taken reasonable security measures to protect
the secrecy, confidentiality and value of all of their intellectual
properties, except where failure to do so could not, individually
or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

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

 

(r) Transactions with Affiliates and
Employees. Except as set forth on Schedule 3.1(r), none of the
officers or directors of the Company or any Subsidiary and, to the
knowledge of the Company, none of the employees of the Company or
any Subsidiary is presently a party to any transaction with the
Company or any Subsidiary (other than for services as employees,
officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by,
providing for rental of real or personal property to or from,
providing for the borrowing of money from or lending of money to or
otherwise requiring payments to or from any officer, director or
such employee or, to the knowledge of the Company, any entity in
which any officer, director, or any such employee has a substantial
interest or is an officer, director, trustee, stockholder, member
or partner, in each case in excess of $120,000 other than for (i)
payment of salary or consulting fees for services rendered, (ii)
reimbursement for expenses incurred on behalf of the Company and
(iii) other employee benefits, including stock option agreements
under any stock option plan of the Company.

 

 

 

 

(s) Sarbanes-Oxley; Internal Accounting
Controls. The Company and the Subsidiaries are in compliance
with any and all applicable requirements of the Sarbanes-Oxley Act
of 2002 that are effective as of the date hereof, and any and all
applicable rules and regulations promulgated by the Commission
thereunder that are effective as of the date hereof and as of the
Closing Date. The Company and the
Subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with
management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences. The Company and the Subsidiaries have
established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the
Subsidiaries and designed such disclosure controls and procedures
to ensure that information required to be disclosed by the Company
in the reports 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. The
Company’s certifying officers have evaluated the
effectiveness of the disclosure controls and procedures of the
Company and the Subsidiaries as of the end of the period covered by
the most recently filed periodic report under the Exchange Act
(such date, the “Evaluation
Date”). The Company
presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on
their evaluations as of the Evaluation Date. Since the Evaluation
Date, there have been no changes in the internal control over
financial reporting (as such term is defined in the Exchange Act)
of the Company and its Subsidiaries that have materially affected,
or is reasonably likely to materially affect, the internal control
over financial reporting of the Company and its
Subsidiaries.

 

(t) Certain Fees. Except as set
forth in the Prospectus Supplement, no brokerage or finder’s
fees or commissions are or will be payable by the Company or any
Subsidiary to any broker, financial advisor or consultant, finder,
placement agent, investment banker, bank or other Person with
respect to the transactions contemplated by the Transaction
Documents. The Purchasers shall have no obligation with respect to
any fees or with respect to any claims made by or on behalf of
other Persons for fees of a type contemplated in this Section that
may be due in connection with the transactions contemplated by the
Transaction Documents.

 

(u) Investment Company. The Company
is not, and is not an Affiliate of, and immediately after receipt
of payment for the Securities, will not be or be an Affiliate of,
an “investment company” within the meaning of the
Investment Company Act of 1940, as amended. The Company shall
conduct its business in a manner so that it will not become an
“investment company” subject to registration under the
Investment Company Act of 1940, as amended.

 

(v) Registration Rights. No Person
has any right to cause the Company or any Subsidiary to effect the
registration under the Securities Act of any securities of the
Company or any Subsidiary.

 

(w) Listing and Maintenance
Requirements. The Common Stock is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act, and the Company has
taken no action designed to, or which to its knowledge is likely to
have the effect of, terminating the registration of the Common
Stock under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such
registration. The Company has not, in the 12 months preceding the
date hereof, received notice from any Trading Market on which the
Common Stock is or has been listed or quoted to the effect that the
Company is not in compliance with the listing or maintenance
requirements of such Trading Market. Except as set forth on
Schedule 3.1(w),
the Company is, and has no reason to believe that it will not in
the foreseeable future continue to be, in compliance with all such
listing and maintenance requirements. The Common Stock is currently
eligible for electronic transfer through the Depository Trust
Company or another established clearing corporation and the Company
is current in payment of the fees to the Depository Trust Company
(or such other established clearing corporation) in connection with
such electronic transfer.

 

(x) Application of Takeover
Protections. The Company and the Board of Directors have
taken all necessary action, if any, in order to render inapplicable
any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other
similar anti-takeover provision under the Company’s
certificate of incorporation (or similar charter documents) or the
laws of its state of incorporation that is or could become
applicable to the Purchasers as a result of the Purchasers and the
Company fulfilling their obligations or exercising their rights
under the Transaction Documents, including without limitation as a
result of the Company’s issuance of the Securities and the
Purchasers’ ownership of the Securities.

 

(y) Disclosure. Except with respect
to the material terms and conditions of the transactions
contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has
provided any of the Purchasers or their agents or counsel with any
information that it believes constitutes or might constitute
material, non-public information which is not otherwise disclosed
in the Prospectus Supplement. The Company understands and confirms
that the Purchasers will rely on the foregoing representation in
effecting transactions in securities of the Company. All of the
disclosure furnished by or on behalf of the Company to the
Purchasers regarding the Company and its Subsidiaries, their
respective businesses and the transactions contemplated hereby,
including the Disclosure Schedules to this Agreement, is true and
correct and does not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make
the statements made therein, in the light of the circumstances
under which they were made, not misleading. The press releases
disseminated by the Company during the twelve months preceding the
date of this Agreement taken as a whole do not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made and when made, not misleading. The Company
acknowledges and agrees that no Purchaser makes or has made any
representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in
Section 3.2 hereof.

 

(z) No Integrated Offering.
Assuming the accuracy of the Purchasers’ representations and
warranties set forth in Section 3.2, neither the Company, nor any
of its Affiliates, nor any Person acting on its or their behalf
has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under
circumstances that would cause this offering of the Securities to
be integrated with prior offerings by the Company for purposes of
any applicable shareholder approval provisions of any Trading
Market on which any of the securities of the Company are listed or
designated.

 

 

 

 

(aa) Solvency.
Based on the consolidated financial condition of the Company as of
the Closing Date, after giving effect to the receipt by the Company
of the proceeds from the sale of the Securities hereunder, (i) the
fair saleable value of the Company’s assets exceeds the
amount that will be required to be paid on or in respect of the
Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the
Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be
conducted including its capital needs taking into account the
particular capital requirements of the business conducted by the
Company, consolidated and projected capital requirements and
capital availability thereof, and (iii) the current cash flow of
the Company, together with the proceeds the Company would receive,
were it to liquidate all of its assets, after taking into account
all anticipated uses of the cash, would be sufficient to pay all
amounts on or in respect of its liabilities when such amounts are
required to be paid. The Company does not intend to incur debts
beyond its ability to pay such debts as they mature (taking into
account the timing and amounts of cash to be payable on or in
respect of its debt). The Company has no knowledge of any facts or
circumstances which lead it to believe that it will file for
reorganization or liquidation under the bankruptcy or
reorganization laws of any jurisdiction within one year from the
Closing Date. Schedule
3.1(aa) sets forth as of the date hereof all outstanding
secured and unsecured Indebtedness of the Company or any
Subsidiary, or for which the Company or any Subsidiary has
commitments. For the purposes of this Agreement,
“Indebtedness”
means (x) any liabilities for borrowed money or amounts owed in
excess of $50,000 (other than trade accounts payable incurred in
the ordinary course of business), (y) all guaranties, endorsements
and other contingent obligations in respect of indebtedness of
others, whether or not the same are or should be reflected in the
Company’s consolidated balance sheet (or the notes thereto),
except guaranties by endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary
course of business; and (z) the present value of any lease payments
in excess of $50,000 due under leases required to be capitalized in
accordance with GAAP. Neither the Company nor any Subsidiary is in
default with respect to any Indebtedness.

 

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

 

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

 

(dd) Accountants.
The Company’s accounting firm is set forth on Schedule 3.1(dd) of the
Disclosure Schedules. To the knowledge and belief of the Company,
such accounting firm (i) is a registered public accounting firm as
required by the Exchange Act and (ii) shall express its opinion
with respect to the financial statements to be included in the
Company’s Annual Report for the fiscal year ended December
31, 2020.

 

(ee)  Acknowledgment
Regarding Purchasers’ Purchase of Securities. The
Company acknowledges and agrees that each of the Purchasers is
acting solely in the capacity of an arm’s length purchaser
with respect to the Transaction Documents and the transactions
contemplated thereby. The Company further acknowledges that no
Purchaser is acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to the
Transaction Documents and the transactions contemplated thereby and
any advice given by any Purchaser or any of their respective
representatives or agents in connection with the Transaction
Documents and the transactions contemplated thereby is merely
incidental to the Purchasers’ purchase of the Securities. The
Company further represents to each Purchaser that the
Company’s decision to enter into this Agreement and the other
Transaction Documents has been based solely on the independent
evaluation of the transactions contemplated hereby by the Company
and its representatives.

 

(ff) Acknowledgment
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein
to the contrary notwithstanding (except for Sections 3.2(f) and
4.13 hereof), it is understood and acknowledged by the Company
that: (i) none of the Purchasers has been asked by the Company to
agree, nor has any Purchaser agreed, to desist from purchasing or
selling, long and/or short, securities of the Company, or
“derivative” securities based on securities issued by
the Company or to hold the Securities for any specified term; (ii)
past or future open market or other transactions by any Purchaser,
specifically including, without limitation, Short Sales or
“derivative” transactions, before or after the closing
of this or future private placement transactions, may negatively
impact the market price of the Company’s publicly-traded
securities; (iii) any Purchaser, and counter-parties in
“derivative” transactions to which any such Purchaser
is a party, directly or indirectly, presently may have a
“short” position in the Common Stock, and (iv) each
Purchaser shall not be deemed to have any affiliation with or
control over any arm’s length counter-party in any
“derivative” transaction. The Company further
understands and acknowledges that (y) one or more Purchasers may
engage in hedging activities at various times during the period
that the Securities are outstanding, and (z) such hedging
activities (if any) could reduce the value of the existing
stockholders' equity interests in the Company at and after the time
that the hedging activities are being conducted.  The Company
acknowledges that such aforementioned hedging activities do not
constitute a breach of any of the Transaction
Documents.

 

 

 

 

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

 

(hh) Stock
Option Plans. Each stock option granted by the Company under
the Company’s stock option plan was granted (i) in accordance
with the terms of the Company’s stock option plan and (ii)
with an exercise price at least equal to the fair market value of
the Common Stock on the date such stock option would be considered
granted under GAAP and applicable law. No stock option granted
under the Company’s stock option plan has been backdated. The
Company has not knowingly granted, and there is no and has been no
Company policy or practice to knowingly grant, stock options prior
to, or otherwise knowingly coordinate the grant of stock options
with, the release or other public announcement of material
information regarding the Company or its Subsidiaries or their
financial results or prospects.

 

(ii) Office
of Foreign Assets Control. Neither the Company nor any
Subsidiary nor, to the Company's knowledge, any director, officer,
agent, employee or affiliate of the Company or any Subsidiary is
currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”).

 

(jj) U.S.
Real Property Holding Corporation. The Company is not and
has never been a U.S. real property holding corporation within the
meaning of Section 897 of the Internal Revenue Code of 1986, as
amended, and the Company shall so certify upon Purchaser’s
request.

 

(kk) Bank
Holding Company Act. Neither the Company nor any of its
Subsidiaries or Affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”) and to regulation
by the Board of Governors of the Federal Reserve System (the
“Federal
Reserve”). Neither the Company nor any of its
Subsidiaries or Affiliates owns or controls, directly or
indirectly, five percent (5%) or more of the outstanding shares of
any class of voting securities or twenty-five percent or more of
the total equity of a bank or any entity that is subject to the
BHCA and to regulation by the Federal Reserve. Neither the Company
nor any of its Subsidiaries or Affiliates exercises a controlling
influence over the management or policies of a bank or any entity
that is subject to the BHCA and to regulation by the Federal
Reserve.

 

(ll) Money
Laundering. The operations of the Company and its
Subsidiaries 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, applicable money laundering statutes and applicable rules
and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action or Proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company
or any Subsidiary with respect to the Money Laundering Laws is
pending or, to the knowledge of the Company or any Subsidiary,
threatened.

 

(mm) Other
Covered Persons. Other than the Placement Agent, the Company
is not aware of any person (other than any Issuer Covered Person)
that has been or will be paid (directly or indirectly) remuneration
for solicitation of purchasers in connection with the sale of any
Securities.

 

(nn) Notice
of Disqualification Events. The Company will notify the
Purchasers in writing, prior to the Closing Date of (i) any
Disqualification Event relating to any Issuer Covered Person and
(ii) any event that would, with the passage of time, reasonably be
expected to become a Disqualification Event relating to any Issuer
Covered Person, in each case of which it is aware.

 

3.2 Representations
and Warranties of the Purchasers. Each Purchaser, for itself and for no other
Purchaser, hereby represents and warrants as of the date hereof and
as of the Closing Date to the Company as follows (unless as of a
specific date therein, in which case they shall be accurate as of
such date):

 

(a)            Organization;
Authority. Such Purchaser is
either an individual or an entity duly incorporated or formed,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation with full right,
corporate, partnership, limited liability company or similar power
and authority to enter into and to consummate the transactions
contemplated by the Transaction Documents and otherwise to carry
out its obligations hereunder and thereunder. The execution and
delivery of the Transaction Documents and performance by such
Purchaser of the transactions contemplated by the Transaction
Documents have been duly authorized by all necessary corporate,
partnership, limited liability company or similar action, as
applicable, on the part of such Purchaser. Each Transaction
Document to which it is a party has been duly executed by such
Purchaser, and when delivered by such Purchaser in accordance with
the terms hereof, will constitute the valid and legally binding
obligation of such Purchaser, enforceable against it in accordance
with its terms, except: (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited
by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) insofar as
indemnification and contribution provisions may be limited by
applicable law.

 

 

 

 

(b)            Understandings
or Arrangements. Such Purchaser
is acquiring the Securities as principal for its own account and
has no direct or indirect arrangement or understandings with any
other persons to distribute or regarding the distribution of such
Securities (this representation and warranty not limiting such
Purchaser’s right to sell the Securities pursuant to the
Registration Statement or otherwise in compliance with applicable
federal and state securities laws). Such Purchaser is acquiring the
Securities hereunder in the ordinary course of its
business.

 

(c)            Purchaser
Status. At the time such
Purchaser was offered the Securities, it was, and as of the date
hereof it is, an “accredited investor” as defined in
Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the
Securities Act.

 

(d)            Experience
of Such Purchaser. Such
Purchaser, either alone or together with its representatives, has
such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities, and has so
evaluated the merits and risks of such investment. Such Purchaser
is able to bear the economic risk of an investment in the
Securities and, at the present time, is able to afford a complete
loss of such investment.

 

(e)            Access
to Information. Such Purchaser
acknowledges that it has had the opportunity to review the
Transaction Documents (including all exhibits and schedules
thereto) and the SEC Reports and has been afforded, (i) the
opportunity to ask such questions as it has deemed necessary of,
and to receive answers from, representatives of the Company
concerning the terms and conditions of the offering of the
Securities and the merits and risks of investing in the Securities;
(ii) access to information about the Company and its financial
condition, results of operations, business, properties, management
and prospects sufficient to enable it to evaluate its investment;
and (iii) the opportunity to obtain such additional information
that the Company possesses or can acquire without unreasonable
effort or expense that is necessary to make an informed investment
decision with respect to the investment.  Such Purchaser
acknowledges and agrees that neither the Placement Agent nor any
Affiliate of the Placement Agent has provided such Purchaser with
any information or advice with respect to the Securities nor is
such information or advice necessary or desired.  Neither the
Placement Agent nor any Affiliate has made or makes any
representation as to the Company or the quality of the Securities
and the Placement Agent and any Affiliate may have acquired
non-public information with respect to the Company which such
Purchaser agrees need not be provided to it.  In connection
with the issuance of the Securities to such Purchaser, neither the
Placement Agent nor any of its Affiliates has acted as a financial
advisor or fiduciary to such Purchaser.

 

(f)            Certain
Transactions and Confidentiality. Other than consummating the transactions
contemplated hereunder, such Purchaser has not, nor has any Person
acting on behalf of or pursuant to any understanding with such
Purchaser, directly or indirectly executed any purchases or sales,
including Short Sales, of the securities of the Company during
the period commencing as of the time that such Purchaser first
received a term sheet (written or oral) from the Company or any
other Person representing the Company setting forth the material
terms of the transactions contemplated hereunder and ending
immediately prior to the execution hereof. Notwithstanding the foregoing, in the case of a
Purchaser that is a multi-managed investment vehicle whereby
separate portfolio managers manage separate portions of such
Purchaser’s assets and the portfolio managers have no direct
knowledge of the investment decisions made by the portfolio
managers managing other portions of such Purchaser’s assets,
the representation set forth above shall only apply with respect to
the portion of assets managed by the portfolio manager that made
the investment decision to purchase the Securities covered by this
Agreement. Other than to other Persons party to this Agreement or
to such Purchaser’s representatives, including, without
limitation, its officers, directors, partners, legal and other
advisors, employees, agents and Affiliates, such Purchaser has
maintained the confidentiality of all disclosures made to it in
connection with this transaction (including the existence and terms
of this transaction). Notwithstanding the foregoing, for the
avoidance of doubt, nothing contained herein shall constitute a
representation or warranty, or preclude any actions, with respect
to locating or borrowing shares in order to effect Short Sales or
similar transactions in the future.

 

The
Company acknowledges and agrees that the representations contained
in this Section 3.2 shall not modify, amend or affect such
Purchaser’s right to rely on the Company’s
representations and warranties contained in this Agreement or any
representations and warranties contained in any other Transaction
Document or any other document or instrument executed and/or
delivered in connection with this Agreement or the consummation of
the transactions contemplated hereby. Notwithstanding the
foregoing, for the avoidance of doubt, nothing contained herein
shall constitute a representation or warranty, or preclude any
actions, with respect to locating or borrowing shares in order to
effect Short Sales or similar transactions in the
future.

 

ARTICLE IV.

OTHER
AGREEMENTS OF THE PARTIES

 

4.1 Legends.
The Shares shall be issued free of legends.

 

4.2 Furnishing
of Information. Until the time
that no Purchaser owns Shares, the Company covenants to timely file
(or obtain extensions in respect thereof and file within the
applicable grace period) all reports required to be filed by the
Company after the date hereof pursuant to the Exchange Act even if
the Company is not then subject to the reporting requirements of
the Exchange Act.

 

4.3  Integration.
The Company shall not sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the
offer or sale of the Shares for purposes of the rules and
regulations of any Trading Market such that it would require
shareholder approval prior to the closing of such other transaction
unless shareholder approval is obtained before the closing of such
subsequent transaction.

 

 

 

 

4.4 Securities
Laws Disclosure; Publicity. The
Company shall (a) by the Disclosure Time, issue a press release
disclosing the material terms of the transactions contemplated
hereby, and (b) file a Current Report on Form 8-K, including the
Transaction Documents as exhibits thereto, with the Commission
within the time required by the Exchange Act. From and after the
issuance of such press release, the Company represents to the
Purchasers that it shall have publicly disclosed all material,
non-public information delivered to any of the Purchasers by the
Company or any of its Subsidiaries, or any of their respective
officers, directors, employees or agents in connection with the
transactions contemplated by the Transaction Documents. In
addition, effective upon the issuance of such press release, the
Company acknowledges and agrees that any and all confidentiality or
similar obligations under any agreement, whether written or oral,
between the Company, any of its Subsidiaries or any of their
respective officers, directors, agents, employees or Affiliates on
the one hand, and any of the Purchasers or any of their Affiliates
on the other hand, shall terminate. The Company and each Purchaser
shall consult with each other in issuing any other press releases
with respect to the transactions contemplated hereby, and neither
the Company nor any Purchaser shall issue any such press release
nor otherwise make any such public statement without the prior
consent of the Company, with respect to any press release of any
Purchaser, or without the prior consent of each Purchaser, with
respect to any press release of the Company, which consent shall
not unreasonably be withheld or delayed, except if such disclosure
is required by law, in which case the disclosing party shall
promptly provide the other party with prior notice of such public
statement or communication. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Purchaser, or
include the name of any Purchaser in any filing with the Commission
or any regulatory agency or Trading Market, without the prior
written consent of such Purchaser, except (a) as required by
federal securities law in connection with the filing of final
Transaction Documents with the Commission and (b) to the extent
such disclosure is required by law or Trading Market regulations,
in which case the Company shall provide the Purchasers with prior
notice of such disclosure permitted under this clause
(b).

 

4.5 Shareholder
Rights Plan. No claim will be
made or enforced by the Company or, with the consent of the
Company, any other Person, that any Purchaser is an
“Acquiring
Person” under any control
share acquisition, business combination, poison pill (including any
distribution under a rights agreement) or similar anti-takeover
plan or arrangement in effect or hereafter adopted by the Company,
or that any Purchaser could be deemed to trigger the provisions of
any such plan or arrangement, by virtue of receiving Securities
under the Transaction Documents or under any other agreement
between the Company and the Purchasers.

 

4.6 Non-Public
Information. Except with
respect to the material terms and conditions of the transactions
contemplated by the Transaction Documents, which shall be disclosed
pursuant to Section 4.4, the Company covenants and agrees that
neither it, nor any other Person acting on its behalf will provide
any Purchaser or its agents or counsel with any information that
constitutes, or the Company reasonably believes constitutes,
material non-public information, unless prior thereto such
Purchaser shall have consented to the receipt of such information
and agreed with the Company to keep such information confidential.
The Company understands and confirms that each Purchaser shall be
relying on the foregoing covenant in effecting transactions in
securities of the Company. To the extent that the Company, any of
its Subsidiaries, or any of their respective officers, directors,
agents, employees or Affiliates delivers any material, non-public
information to a Purchaser without such Purchaser’s consent,
the Company hereby covenants and agrees that such Purchaser shall
not have any duty of confidentiality to the Company, any of its
Subsidiaries, or any of their respective officers, directors,
agents, employees or Affiliates, or a duty to the Company, any of
its Subsidiaries or any of their respective officers, directors,
agents, employees or Affiliates not to trade on the basis of, such
material, non-public information, provided that the Purchaser shall
remain subject to applicable law. To the extent that any notice
provided pursuant to any Transaction Document constitutes, or
contains, material, non-public information regarding the Company or
any Subsidiaries, the Company shall simultaneously file such notice
with the Commission pursuant to a Current Report on Form 8-K. The
Company understands and confirms that each Purchaser shall be
relying on the foregoing covenant in effecting transactions in
securities of the Company.

 

4.7 Use of
Proceeds. Except as set forth
on Schedule 4.7
attached hereto, the Company shall use
the net proceeds from the sale of the Securities hereunder for
working capital purposes and shall not use such proceeds: (a) for
the satisfaction of any portion of the Company’s debt (other
than payment of trade payables in the ordinary course of the
Company’s business and prior practices), (b) for the
redemption of any Common Stock or Common Stock Equivalents, (c) for
the settlement of any outstanding litigation or (d) in violation of
FCPA or OFAC regulations.

 

4.8 Indemnification
of Purchasers. Subject to the
provisions of this Section 4.8, the Company will indemnify and hold
each Purchaser and its directors, officers, shareholders, members,
partners, employees and agents (and any other Persons with a
functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title), each
Person who controls such Purchaser (within the meaning of Section
15 of the Securities Act and Section 20 of the Exchange Act), and
the directors, officers, shareholders, agents, members, partners or
employees (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding a lack of such
title or any other title) of such controlling persons (each, a
“Purchaser
Party”) harmless from any
and all losses, liabilities, obligations, claims, contingencies,
damages, costs and expenses, including all judgments, amounts paid
in settlements, court costs and reasonable attorneys’ fees
and costs of investigation that any such Purchaser Party may suffer
or incur as a result of or relating to (a) any breach of any of the
representations, warranties, covenants or agreements made by the
Company in this Agreement or in the other Transaction Documents, or
(b) any action instituted against the Purchaser Parties in any
capacity, or any of them or their respective Affiliates, by any
stockholder of the Company who is not an Affiliate of such
Purchaser Party, with respect to any of the transactions
contemplated by the Transaction Documents (unless such action is
solely based upon a material breach of such Purchaser Party’s
representations, warranties or covenants under the Transaction
Documents or any agreements or understandings such Purchaser Party
may have with any such stockholder or any violations by such
Purchaser Party of state or federal securities laws or any conduct
by such Purchaser Party which is finally judicially determined to
constitute fraud, gross negligence or willful misconduct), the
Company will indemnify each Purchaser Party, to the fullest extent
permitted by applicable law, from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation,
reasonable attorneys’ fees) and expenses, as incurred,
arising out of or relating to (i) any untrue or alleged untrue
statement of a material fact contained in such registration
statement, any prospectus or any form of prospectus or in any
amendment or supplement thereto or in any preliminary prospectus,
or arising out of or relating to any omission or alleged omission
of a material fact required to be stated therein or necessary to
make the statements therein (in the case of any prospectus or
supplement thereto, in the light of the circumstances under which
they were made) not misleading, except to the extent, but only to
the extent, that such untrue statements or omissions are based
solely upon information regarding such Purchaser Party furnished in
writing to the Company by such Purchaser Party expressly for use
therein, or (ii) any violation or alleged violation by the Company
of the Securities Act, the Exchange Act or any state securities
law, or any rule or regulation thereunder in connection therewith.
If any action shall be brought against any Purchaser Party in
respect of which indemnity may be sought pursuant to this
Agreement, such Purchaser Party shall promptly notify the Company
in writing, and the Company shall have the right to assume the
defense thereof with counsel of its own choosing reasonably
acceptable to the Purchaser Party. Any Purchaser Party shall have
the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such Purchaser Party except
to the extent that (x) the employment thereof has been specifically
authorized by the Company in writing, (y) the Company has failed
after a reasonable period of time to assume such defense and to
employ counsel or (z) in such action there is, in the reasonable
opinion of counsel, a material conflict on any material issue
between the position of the Company and the position of such
Purchaser Party, in which case the Company shall be responsible for
the reasonable fees and expenses of no more than one such separate
counsel. The Company will not be liable to any Purchaser Party
under this Agreement (1) for any settlement by a Purchaser Party
effected without the Company’s prior written consent, which
shall not be unreasonably withheld or delayed; or (2) to the
extent, but only to the extent that a loss, claim, damage or
liability is attributable to any Purchaser Party’s breach of
any of the representations, warranties, covenants or agreements
made by such Purchaser Party in this Agreement or in the other
Transaction Documents. The
indemnification required by this Section 4.8 shall be made by
periodic payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or are
incurred. The indemnity agreements contained herein shall be in
addition to any cause of action or similar right of any Purchaser
Party against the Company or others and any liabilities the Company
may be subject to pursuant to law.

 

 

 

 

4.9 Reservation
of Common Stock. As of the date
hereof, the Company has reserved and the Company shall continue to
reserve and keep available at all times, free of preemptive rights,
a sufficient number of shares of Common Stock for the purpose of
enabling the Company to issue Shares pursuant to this
Agreement.

 

4.10 Listing
of Common Stock. The Company
hereby agrees to use best efforts to maintain the listing or
quotation of the Common Stock on the Trading Market on which it is
currently listed, and concurrently with the Closing, the Company
shall apply to list or quote all of the Shares on such Trading
Market and promptly secure the listing of all of the Shares on such
Trading Market. The Company further agrees, if the Company applies
to have the Common Stock traded on any other Trading Market, it
will then include in such application all of the Shares, and will
take such other action as is necessary to cause all of the Shares
to be listed or quoted on such other Trading Market as promptly as
possible. The Company will then take all action reasonably
necessary to continue the listing and trading of its Common Stock
on a Trading Market and will comply in all respects with the
Company’s reporting, filing and other obligations under the
bylaws or rules of the Trading Market. The Company agrees to
maintain the eligibility of the Common Stock for electronic
transfer through the Depository Trust Company or another
established clearing corporation, including, without limitation, by
timely payment of fees to the Depository Trust Company or such
other established clearing corporation in connection with such
electronic transfer.

 

4.11 Subsequent
Equity Sales.

 

(a) From the date
hereof until ninety (90) days after the Closing Date, neither the
Company nor any Subsidiary shall (i) issue, enter into any
agreement to issue or announce the issuance or proposed issuance of
any shares of Common Stock or Common Stock Equivalents or (ii) file
any registration statement or amendment or supplement thereto,
other than the Prospectus Supplement. Notwithstanding the
foregoing, following the fourteen (14) day anniversary of the date
of this Agreement, the Company shall be permitted to file (i) a
primary “shelf” registration statement on Form S-3, and
(ii) a registration statement for the resale of the warrant shares
issuable upon exercise of the warrants issued pursuant to the
Prior February Agreement (as defined
in Section 5.21).

 

(b) From the date
hereof until the one (1) year anniversary of the Closing 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 or Common Stock Equivalents (or a
combination of units thereof) involving a Variable Rate
Transaction. “Variable Rate
Transaction” means a transaction in which the Company
(i) issues or sells any debt or equity securities 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,
or effects a transaction under, any agreement, including, but not
limited to, an equity line of credit, whereby the Company may issue
securities at a future determined price. Any Purchaser shall be
entitled to obtain injunctive relief against the Company to
preclude any such issuance, which remedy shall be in addition to
any right to collect damages.

 

(c) Notwithstanding the
foregoing, this Section 4.11 shall not apply in respect of an
Exempt Issuance, except that no Variable Rate Transaction shall be
an Exempt Issuance.

 

4.12 Equal
Treatment of Purchasers. No
consideration (including any modification of any Transaction
Document) shall be offered or paid to any Person to amend or
consent to a waiver or modification of any provision of the
Transaction Documents unless the same consideration is also offered
to all of the parties to the Transaction Documents. For
clarification purposes, this provision constitutes a separate right
granted to each Purchaser by the Company and negotiated separately
by each Purchaser, and is intended for the Company to treat the
Purchasers as a class and shall not in any way be construed as the
Purchasers acting in concert or as a group with respect to the
purchase, disposition or voting of Securities or
otherwise.

 

4.13 Certain
Transactions and Confidentiality. Each Purchaser, severally and not jointly with
the other Purchasers, covenants that neither it nor any Affiliate
acting on its behalf or pursuant to any understanding with it will
execute any purchases or sales, including Short Sales of any of the
Company’s securities during the period commencing with the
execution of this Agreement and ending at such time that the
transactions contemplated by this Agreement are first publicly
announced pursuant to the initial press release as described in
Section 4.4.  Each Purchaser, severally and not jointly with
the other Purchasers, covenants that until such time as the
transactions contemplated by this Agreement are publicly disclosed
by the Company pursuant to the initial press release as described
in Section 4.4, such Purchaser will maintain the confidentiality of
the existence and terms of this transaction and the information
included in the Disclosure Schedules.  Notwithstanding the
foregoing and notwithstanding anything contained in this Agreement
to the contrary, the Company expressly acknowledges and agrees that
(i) no Purchaser makes any representation, warranty or covenant
hereby that it will not engage in effecting transactions in any
securities of the Company after the time that the transactions
contemplated by this Agreement are first publicly announced
pursuant to the initial press release as described in Section 4.4,
(ii) no Purchaser shall be restricted or prohibited from effecting
any transactions in any securities of the Company in accordance
with applicable securities laws from and after the time that the
transactions contemplated by this Agreement are first publicly
announced pursuant to the initial press release as described in
Section 4.4 and (iii) no Purchaser shall have any duty of
confidentiality or duty not to trade in the securities of the
Company to the Company or its Subsidiaries after the issuance of
the initial press release as described in Section 4.4. 
Notwithstanding the foregoing, in the case of a Purchaser that is a
multi-managed investment vehicle whereby separate portfolio
managers manage separate portions of such Purchaser’s assets
and the portfolio managers have no direct knowledge of the
investment decisions made by the portfolio managers managing other
portions of such Purchaser’s assets, the covenant set forth
above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision
to purchase the Securities covered by this
Agreement.

 

4.14 Capital
Changes. Until the one year
anniversary of the Closing Date, the Company shall not undertake a
reverse or forward stock split or reclassification of the Common
Stock without the prior written consent of the Purchasers holding a
majority in interest of the Shares; provided,
however, that no such consent shall be required from Purchasers if
the reason for a reverse stock split is to maintain the
Company’s listing on the Trading Market.

 

 

 

 

ARTICLE V.

MISCELLANEOUS

 

5.1 Termination. 
This Agreement may be terminated by any Purchaser, as to such
Purchaser’s obligations hereunder only and without any effect
whatsoever on the obligations between the Company and the other
Purchasers, by written notice to the other parties, if the Closing
has not been consummated on or before the fifth
(5th)
Trading Day following the date hereof; provided,
however,
that no such termination will affect the right of any party to sue
for any breach by any other party (or parties).

 

5.2 Fees
and Expenses. Except as
expressly set forth in the Transaction Documents to the contrary,
each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other
expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement.
The Company shall pay all Transfer Agent fees (including, without
limitation, any fees required for same-day processing of any
instruction letter delivered by the Company and any exercise notice
delivered by a Purchaser), stamp taxes and other taxes and duties
levied in connection with the delivery of any Securities to the
Purchasers.

 

5.3 Entire
Agreement. The Transaction
Documents, together with the exhibits and schedules thereto, the
Prospectus and the Prospectus Supplement, contain the entire
understanding of the parties with respect to the subject matter
hereof and thereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters,
which the parties acknowledge have been merged into such documents,
exhibits and schedules.

 

5.4 Notices.
Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall
be deemed given and effective on the earliest of: (a) the time of
transmission, if such notice or communication is delivered via
facsimile at the facsimile number or email attachment at the email
address as set forth on the signature pages attached hereto at or
prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the
next Trading Day after the time of transmission, if such notice or
communication is delivered via facsimile at the facsimile number or
email attachment at the email address as set forth on the signature
pages attached hereto on a day that is not a Trading Day or later
than 5:30 p.m. (New York City time) on any Trading Day, (c) the
second (2nd)
Trading Day following the date of mailing, if sent by U.S.
nationally recognized overnight courier service or (d) upon actual
receipt by the party to whom such notice is required to be given.
The address for such notices and communications shall be as set
forth on the signature pages attached hereto.

 

5.5 Amendments;
Waivers. No provision of this
Agreement may be waived, modified, supplemented or amended except
in a written instrument signed, in the case of an amendment, by the
Company and Purchasers which purchased at least 50.1% in interest
of the Shares based on the initial Subscription Amounts hereunder
(or, prior to the Closing, the Company and each Purchaser) or, in
the case of a waiver, by the party against whom enforcement of any
such waived provision is sought, provided that if any amendment,
modification or waiver disproportionately and adversely impacts a
Purchaser (or group of Purchasers), the consent of such
disproportionately impacted Purchaser (or group of Purchasers)
shall also be required. No waiver of any default with respect to
any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any
subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of any party to
exercise any right hereunder in any manner impair the exercise of
any such right. Any proposed amendment or waiver that
disproportionately, materially and adversely affects the rights and
obligations of any Purchaser relative to the comparable rights and
obligations of the other Purchasers shall require the prior written
consent of such adversely affected Purchaser. Any amendment
effected in accordance with this Section 5.5 shall be binding upon
each Purchaser and holder of Securities and the
Company.

 

5.6 Headings.
The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.

 

5.7 Successors
and Assigns. This Agreement
shall be binding upon and inure to the benefit of the parties and
their successors and permitted assigns. The Company may not assign
this Agreement or any rights or obligations hereunder without the
prior written consent of each Purchaser (other than by merger). Any
Purchaser may assign any or all of its rights under this Agreement
to any Person to whom such Purchaser assigns or transfers any
Securities, provided that such transferee agrees in writing to be
bound, with respect to the transferred Securities, by the
provisions of the Transaction Documents that apply to the
“Purchasers.”

 

5.8 No
Third-Party Beneficiaries. The
Placement Agent shall be the third party beneficiary of the
representations and warranties of the Company in Section 3.1 and
the representations and warranties of the Purchasers in Section
3.2. This Agreement is intended for the benefit of the parties
hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.8
and this Section 5.8.

 

5.9 Governing
Law. All questions concerning
the construction, validity, enforcement and interpretation of the
Transaction Documents shall be governed by and construed and
enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof.
Each party agrees that all legal Proceedings concerning the
interpretations, enforcement and defense of the transactions
contemplated by this Agreement and any other Transaction Documents
(whether brought against a party hereto or its respective
affiliates, directors, officers, shareholders, partners, members,
employees or agents) shall be commenced exclusively in the state
and federal courts sitting in the City of New York. Each party
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 (including with respect to the enforcement of any
of the Transaction Documents), and hereby irrevocably waives, and
agrees not to assert in any Action or Proceeding, any claim that it
is not personally subject to the jurisdiction of any such court,
that such Action or Proceeding is improper or is an inconvenient
venue for such Proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in
any such Action or Proceeding by mailing a copy thereof via
registered or certified mail or overnight delivery (with evidence
of delivery) 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 other manner permitted by
law. If any party shall commence an Action or Proceeding to enforce
any provisions of the Transaction Documents, then, in addition to
the obligations of the Company under Section 4.8, the prevailing
party in such Action or Proceeding shall be reimbursed by the
non-prevailing party for its reasonable attorneys’ fees and
other costs and expenses incurred with the investigation,
preparation and prosecution of such Action or
Proceeding.

 

 

 

 

5.10 Survival.
The representations and warranties contained herein shall survive
the Closing and the delivery of the Securities.

 

5.11 Execution.
This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same
agreement and shall become effective when counterparts have been
signed by each party and delivered to each other party, it being
understood that the parties need not sign the same counterpart. In
the event that any signature is delivered by facsimile transmission
or by e-mail delivery of a “.pdf” format data file,
such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed)
with the same force and effect as if such facsimile or
“.pdf” signature page were an original
thereof.

 

5.12 Severability.
If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their
commercially reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It
is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or
unenforceable.

 

5.13 Rescission
and Withdrawal Right.
Notwithstanding anything to the contrary contained in (and without
limiting any similar provisions of) any of the other Transaction
Documents, whenever any Purchaser exercises a right, election,
demand or option under a Transaction Document and the Company does
not timely perform its related obligations within the periods
therein provided, then such Purchaser may rescind or withdraw, in
its sole discretion from time to time upon written notice to the
Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and
rights.

 

5.14 Replacement
of Securities. If any
certificate or instrument evidencing any Securities is mutilated,
lost, stolen or destroyed, the Company shall issue or cause to be
issued in exchange and substitution for and upon cancellation
thereof (in the case of mutilation), or in lieu of and substitution
therefor, a new certificate or instrument, but only upon receipt of
evidence reasonably satisfactory to the Company of such loss, theft
or destruction. The applicant for a new certificate or instrument
under such circumstances shall also pay any reasonable third-party
costs (including customary indemnity) associated with the issuance
of such replacement Securities.

 

5.15 Remedies.
In addition to being entitled to exercise all rights provided
herein or granted by law, including recovery of damages, each of
the Purchasers and the Company will be entitled to specific
performance under the Transaction Documents. The parties agree that
monetary damages may not be adequate compensation for any loss
incurred by reason of any breach of obligations contained in the
Transaction Documents and hereby agree to waive and not to assert
in any Action for specific performance of any such obligation the
defense that a remedy at law would be adequate.

 

5.16 Payment
Set Aside. To the extent that
the Company makes a payment or payments to any Purchaser pursuant
to any Transaction Document or a Purchaser enforces or exercises
its rights thereunder, and such payment or payments or the proceeds
of such enforcement or exercise or any part thereof are
subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the
Company, a trustee, receiver or any other Person under any law
(including, without limitation, any bankruptcy law, state or
federal law, common law or equitable cause of action), then to the
extent of any such restoration the obligation or part thereof
originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or
such enforcement or setoff had not occurred.

 

5.17 Independent
Nature of Purchasers’ Obligations and
Rights. The obligations of each
Purchaser under any Transaction Document are several and not joint
with the obligations of any other Purchaser, and no Purchaser shall
be responsible in any way for the performance or non-performance of
the obligations of any other Purchaser under any Transaction
Document. Nothing contained herein or in any other Transaction
Document, and no action taken by any Purchaser pursuant hereto or
thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Purchasers are in any way
acting in concert or as a group with respect to such obligations or
the transactions contemplated by the Transaction Documents. Each
Purchaser shall be entitled to independently protect and enforce
its rights including, without limitation, the rights arising out of
this Agreement or out of the other Transaction Documents, and it
shall not be necessary for any other Purchaser to be joined as an
additional party in any Proceeding for such purpose. Each Purchaser
has been represented by its own separate legal counsel in its
review and negotiation of the Transaction Documents. For reasons of
administrative convenience only, each Purchaser and its respective
counsel have chosen to communicate with the Company through EGS.
EGS does not represent any of the Purchasers and only represents
the Placement Agent. The Company has elected to provide all
Purchasers with the same terms and Transaction Documents for the
convenience of the Company and not because it was required or
requested to do so by any of the Purchasers. It is expressly
understood and agreed that each provision contained in this
Agreement and in each other Transaction Document is between the
Company and a Purchaser, solely, and not between the Company and
the Purchasers collectively and not between and among the
Purchasers.

 

5.18 Liquidated
Damages. The Company’s
obligations to pay any partial liquidated damages or other amounts
owing under the Transaction Documents is a continuing obligation of
the Company and shall not terminate until all unpaid partial
liquidated damages and other amounts have been paid notwithstanding
the fact that the instrument or security pursuant to which such
partial liquidated damages or other amounts are due and payable
shall have been canceled.

 

 

 

 

5.19 Saturdays,
Sundays, Holidays, etc. If the
last or appointed day for the taking of any action or the
expiration of any right required or granted herein shall not be a
Business Day, then such action may be taken or such right may be
exercised on the next succeeding Business Day.

 

5.20 Construction.
The parties agree that each of them and/or their respective counsel
have reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of the
Transaction Documents or any amendments thereto. In addition, each
and every reference to share prices and shares of Common Stock in
any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and
other similar transactions of the Common Stock that occur after the
date of this Agreement.

 

5.21 Waiver of Right of
First Refusal.. Reference is
made to that that certain Securities Purchase Agreement, dated as
of July 23, 2020, by and among the Company and the investors party
thereto (the “Prior July
Agreement”). The
undersigned Purchasers that also entered into the Prior July
Agreement with the Company (the “Prior July
Purchasers”) hereby
waive, on a one time basis, any provision contained in the Prior
July Agreement, in whole or in part, as applicable, prohibiting or
limiting the transactions contemplated by this
Agreement.

 

5.22 Waiver of Prohibition
of Future Financings. Reference
is made to that that certain Securities Purchase Agreement, dated
as of February 1, 2021, by and among the Company and the investors
party thereto (the “Prior February
Agreement”). The
undersigned Purchasers that also entered into the Prior February
Agreement with the Company (the “Prior February
Purchasers”) hereby
waive, on a one time basis, any provision contained in Section 4.11
of the Prior February Agreement, in whole or in part, as
applicable, to effect the transactions contemplated by this
Agreement.

 

5.23 WAIVER
OF JURY TRIAL.
IN ANY
ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY
PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND
INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW,
HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY
WAIVES FOREVER TRIAL BY JURY.

 

 

(Signature Pages Follow)

 

 

 

 

IN
WITNESS WHEREOF, the parties hereto have caused this Securities
Purchase Agreement to be duly executed by their respective
authorized signatories as of the date first indicated
above.

 

 

	

UNITED STATES ANTIMONY CORPORATION

 

 

	

Address
for Notice:

P.O.
Box 643

Thompson
Falls, Montana 59873

	

By:
/s/ John
Gustavsen

     Name:
John Gustavsen

     Title:
Interim Chief Executive Officer

 

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

	

 

E-Mail:
jcgustavsen54@verizon.net

Fax:
(406) 827-3543

	

 

Pryor
Cashman LLP

7 Times
Square

New
York, NY 10036

Attention:
M. Ali Panjwani, Esq.

E-Mail:
ali.panjwani@pryorcashman.com

 

 

 

	
 

 

[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE
PAGE FOR PURCHASER FOLLOWS]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[PURCHASER
SIGNATURE PAGES TO UAMY SECURITIES PURCHASE AGREEMENT]

 

IN
WITNESS WHEREOF, the undersigned have caused this Securities
Purchase Agreement to be duly executed by their respective
authorized signatories as of the date first indicated
above.

 

Name of
Purchaser:
________________________________________________________

 

Signature of Authorized Signatory of
Purchaser: _________________________________

 

Name of
Authorized Signatory:
_______________________________________________

 

Title
of Authorized Signatory:
________________________________________________

 

Email
Address of Authorized
Signatory:_________________________________________

 

Address
for Notice to Purchaser:

 

 

 

Subscription
Amount: $_________________

 

Shares:
_________________

 

EIN
Number: _______________________

 

☐
Notwithstanding anything contained in this Agreement to the
contrary, by checking this box (i) the obligations of the
above-signed to purchase the securities set forth in this Agreement
to be purchased from the Company by the above-signed, and the
obligations of the Company to sell such securities to the
above-signed, shall be unconditional and all conditions to Closing
shall be disregarded, (ii) the Closing shall occur on the second
(2nd)
Trading Day following the date of this Agreement and (iii) any
condition to Closing contemplated by this Agreement (but prior to
being disregarded by clause (i) above) that required delivery by
the Company or the above-signed of any agreement, instrument,
certificate or the like or purchase price (as applicable) shall no
longer be a condition and shall instead be an unconditional
obligation of the Company or the above-signed (as applicable) to
deliver such agreement, instrument, certificate or the like or
purchase price (as applicable) to such other party on the Closing
Date.uamy_ex102

 

Exhibit 10.2

PLACEMENT AGENCY AGREEMENT

 

February 10,
2021

 

Roth
Capital Partners, LLC

888 San
Clemente Drive

Newport
Beach, CA 92660

 

Ladies
and Gentlemen:

 

Introduction. Subject to the terms and
conditions herein (this “Agreement”), United
States Antimony Corporation, a Montana corporation (the
“Company”), hereby agrees
to sell up to an aggregate of $14,287,000 of registered securities
of the Company, including, but not limited to, shares (the
“Shares” or the
“Securities”) of the
Company’s common stock, $0.01 par value per share (the
"Common
Stock”), to various investors (each, an
“Investor” and,
collectively, the “Investors”) through Roth
Capital Partners, LLC, as placement agent (the “Placement Agent”). The
documents executed and delivered by the Company and the Investors
in connection with the Offering (as defined below), including,
without limitation, a securities purchase agreement (the
“Purchase
Agreement”), shall be collectively referred to herein
as the “Transaction
Documents.” The purchase price to the Investors for
each Share is $1.30. The Placement Agent may retain other brokers
or dealers to act as sub-agents or selected-dealers on its behalf
in connection with the Offering.

 

The
Company hereby confirms its agreement with the Placement Agent as
follows:

 

Section
1. Agreement to Act as Placement
Agent.

 

(a) On the basis of the
representations, warranties and agreements of the Company herein
contained, and subject to all the terms and conditions of this
Agreement, the Placement Agent shall be the exclusive placement
agent in connection with the offering and sale by the Company of
the Securities pursuant to the Company's registration statement on
Form S-3 (File No. 333-252193) (the “Registration Statement”),
with the terms of such offering (the “Offering”) to be subject
to market conditions and negotiations between the Company, the
Placement Agent and the prospective Investors. The Placement Agent
will act on a reasonable best efforts basis and the Company agrees
and acknowledges that there is no guarantee of the successful
placement of the Securities, or any portion thereof, in the
prospective Offering. Under no circumstances will the Placement
Agent or any of its “Affiliates” (as defined below) be
obligated to underwrite or purchase any of the Shares for its own
account or otherwise provide any financing. The Placement Agent
shall act solely as the Company’s agent and not as principal.
The Placement Agent shall have no authority to bind the Company
with respect to any prospective offer to purchase Shares and the
Company shall have the sole right to accept offers to purchase
Shares and may reject any such offer, in whole or in part. Subject
to the terms and conditions hereof, payment of the purchase price
for, and delivery of, the Securities shall be made at one or more
closings (each a “Closing” and the date on
which each Closing occurs, a “Closing Date”). The
Closing shall occur via “Delivery Versus Payment”,
i.e., on the Closing Date, the Company shall issue the Shares
directly to the account designated by the Placement Agent and, upon
receipt of such Shares, the Placement Agent shall electronically
deliver such Shares to the applicable Investor and payment shall be
made by the Placement Agent (or its clearing firm) by wire transfer
to the Company. As compensation for services rendered, on each
Closing Date, the Company shall pay to the Placement Agent the fees
and expenses set forth below:

 

(i) A cash fee equal to
6.0% of the gross proceeds received by the Company from the sale of
the Securities at the closing of the Offering (the
“Closing”).

 

(ii) The
Company also agrees to reimburse Placement Agent’s expenses
(with supporting invoices/receipts) up to $50,000.

 

(b) The term of the
Placement Agent's exclusive engagement will be until the completion
of the Offering (the “Exclusive Term”);
provided,
however, that a
party hereto may terminate the engagement with respect to itself at
any time upon 10 days written notice to the other parties.
Notwithstanding anything to the contrary contained herein, the
provisions concerning confidentiality, indemnification and
contribution contained herein and the Company’s obligations
contained in the indemnification provisions will survive any
expiration or termination of this Agreement, and the
Company’s obligation to pay fees actually earned and payable
and to reimburse expenses actually incurred and reimbursable
pursuant to Section 1 hereof and which are permitted to be
reimbursed under FINRA Rule 5110(f)(2)(D)(i), will survive any
expiration or termination of this Agreement. Nothing in this
Agreement shall be construed to limit the ability of the Placement
Agent or its Affiliates to pursue, investigate, analyze, invest in,
or engage in investment banking, financial advisory or any other
business relationship with Persons (as defined below) other than
the Company. As used herein (i) “Persons” means an
individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any kind and (ii)
“Affiliate” means any Person that, directly or
indirectly through one or more intermediaries, controls or is
controlled by or is under common control with a Person as such
terms are used in and construed under Rule 405 under the Securities
Act of 1933, as amended (the “Securities
Act”).

 

 

 

 

Section
2. Representations, Warranties and Covenants of
the Company. The Company hereby represents, warrants and
covenants to the Placement Agent as of the date hereof, and as of
each Closing Date, as follows:

 

(a) Securities Law Filings. The
Company has filed with the Securities and Exchange Commission (the
“Commission”) the
Registration Statement under the Securities Act, which was filed on
January 19, 2021 and declared effective on January 27, 2021 for the
registration of the Securities under the Securities Act. Following
the determination of pricing among the Company and the prospective
Investors introduced to the Company by Placement Agent, the Company
will file with the Commission pursuant to Rules 430A and 424(b)
under the Securities Act, and the rules and regulations (the
“Rules and
Regulations”) of the Commission promulgated
thereunder, a final prospectus supplement relating to the placement
of the Securities, their respective pricings and the plan of
distribution thereof and will advise the Placement Agent of all
further information (financial and other) with respect to the
Company required to be set forth therein. Such registration
statement, at any given time, including the exhibits thereto filed
at such time, as amended at such time, is hereinafter called the
“Registration
Statement”; such prospectus in the form in which it
appears in the Registration Statement at the time of effectiveness,
together with any preliminary prospectus supplement relating to the
Offering, is hereinafter called the “Base Prospectus”; the
preliminary prospectus supplement in the form in which it was filed
with the Commission pursuant to Rule 424(b) is hereinafter called
the “Preliminary
Prospectus Supplement”; and the final prospectus
supplement, in the form in which it will be filed with the
Commission pursuant to Rule 424(b) (including the Base Prospectus
as it may be amended or supplemented) is hereinafter called the
“Final
Prospectus.” The Registration Statement at the time it
originally became effective is hereinafter called the
“Original
Registration Statement.” Any reference in this
Agreement to the Registration Statement, the Original Registration
Statement, the Base Prospectus, the Preliminary Prospectus
Supplement or the Final Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein (the
“Incorporated
Documents”), if any, which were or are filed under the
Securities Exchange Act of 1934, as amended (the
“Exchange
Act”), at any given time, as the case may be; and any
reference in this Agreement to the terms “amend,”
“amendment” or “supplement” with respect to
the Registration Statement, the Original Registration Statement,
the Base Prospectus, the Preliminary Prospectus Supplement or the
Final Prospectus shall be deemed to refer to and include the filing
of any document under the Exchange Act after the date of this
Agreement, or the issue date of the Base Prospectus, the
Preliminary Prospectus Supplement or the Final Prospectus, as the
case may be, deemed to be incorporated therein by reference. All
references in this Agreement to financial statements and schedules
and other information which is “contained,”
“included,” “described,”
“referenced,” “set forth” or
“stated” in the Registration Statement, the Base
Prospectus, the Preliminary Prospectus Supplement or the Final
Prospectus (and all other references of like import) shall be
deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be
incorporated by reference in the Registration Statement, the Base
Prospectus, the Preliminary Prospectus Supplement or the Final
Prospectus, as the case may be. As used in this paragraph and
elsewhere in this Agreement, “Time of Sale Disclosure
Package” means the Base Prospectus, any preliminary
prospectus supplement, any subscription agreement between the
Company and the Investors, and any issuer free writing prospectus
as defined in Rule 433 of the Act (each, an “Issuer Free Writing
Prospectus”), if any, that the parties hereto shall
hereafter expressly agree in writing to treat as part of the Time
of Sale Disclosure Package. The term “any Prospectus” shall
mean, as the context requires, the Base Prospectus, the Final
Prospectus, and any supplement to either thereof. The Company has
not received any notice that the Commission has issued or intends
to issue a stop order suspending the effectiveness of the
Registration Statement or the use of the Base Prospectus or any
Prospectus Supplement or intends to commence a proceeding for any
such purpose.

 

(b) Assurances. The Original
Registration Statement, as amended, (and any further documents to
be filed with the Commission) contains all exhibits and schedules
as required by the Securities Act. Each of the Registration
Statement and any post-effective amendment thereto, at the time it
became effective, complied in all material respects with the
Securities Act and the applicable Rules and Regulations and did not
contain any 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 Base Prospectus, and the
Final Prospectus, each as of its respective date, comply or will
comply in all material respects with the Securities Act and the
applicable Rules and Regulations. Each of the Base Prospectus and
the Final Prospectus, as amended or supplemented, did not and will
not contain as of the date thereof any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading. The Incorporated Documents,
when they were filed with the Commission, conformed in all material
respects to the requirements of the Exchange Act and the applicable
Rules and Regulations promulgated thereunder, and none of such
documents, when they were filed with the Commission, contained any
untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein (with respect to
Incorporated Documents incorporated by reference in the Base
Prospectus or Final Prospectus), in light of the circumstances
under which they were made not misleading. No post-effective
amendment to the Registration Statement reflecting any facts or
events arising after the date thereof which represent, individually
or in the aggregate, a fundamental change in the information set
forth therein is required to be filed with the Commission. Except
for this Agreement, there are no documents required to be filed
with the Commission in connection with the transaction contemplated
hereby that (x) have not been filed as required pursuant to the
Securities Act or (y) will not be filed within the requisite time
period. Except for this Agreement, there are no contracts or other
documents required to be described in the Base Prospectus or Final
Prospectus, or to be filed as exhibits or schedules to the
Registration Statement, which have not been described or filed as
required.

 

(c) Offering Materials. Neither the
Company nor any of its directors and officers has distributed and
none of them will distribute, prior to each Closing Date, any
offering material in connection with the offering and sale of the
Securities other than the Time of Sale Disclosure
Package.

 

(d) Subsidiaries. All of the direct
and indirect subsidiaries of the Company (the “Subsidiaries”) are set
forth in the Incorporated Documents. The Company owns, directly or
indirectly, all of the capital stock or other equity interests of
each Subsidiary free and clear of any liens, charges, security
interests, encumbrances, rights of first refusal, preemptive rights
or other restrictions (collectively, “Liens”), and all
of the issued and outstanding shares of capital stock of each
Subsidiary are validly issued and are fully paid, non-assessable
and free of preemptive and similar rights to subscribe for or
purchase securities.

 

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

 

 

 

 

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

 

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

 

(h) Filings, Consents and
Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or
make any filing or registration with, any court or other federal,
state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the
Company of this Agreement and the transactions contemplated
pursuant to the Base Prospectus, other than: (i) the filing with
the Commission of the Final Prospectus, (ii) application(s) to the
NYSE American (the “Trading Market”) for the
listing of the Securities for trading thereon in the time and
manner required thereby and (iii) such filings as are required to
be made under applicable state securities laws (collectively, the
“Required
Approvals”).

 

(i) Issuance of the Securities;
Registration. The Securities are duly authorized and, when
issued and paid for in accordance with the Final Prospectus, will
be duly and validly issued, fully paid and nonassessable, free and
clear of all Liens imposed by the Company. The Company has reserved
from its duly authorized capital stock the maximum number of shares
of Common Stock issuable pursuant to the Final
Prospectus.

 

(j) Capitalization. The
capitalization of the Company is as set forth in the Incorporated
Documents. The Company has not issued any capital stock since its
most recently filed periodic report
under the Exchange Act, other than pursuant to the exercise
of employee stock options under the Company’s stock option
plans, the issuance of shares of Common Stock to employees pursuant
to the Company’s employee stock purchase plans and pursuant
to the conversion and/or exercise of securities of the Company or
the Subsidiaries which would entitle the holder thereof to acquire
at any time any Common Stock, including, without limitation, any
debt, preferred stock, rights, options, warrants or other
instrument that is at any time convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to
receive, Common Stock (“Common Stock
Equivalents”) outstanding as of the date of the most
recently filed periodic report under the Exchange Act. No Person
has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the
transactions contemplated by this Agreement and the transactions
contemplated pursuant to the Base Prospectus. Except as a result of
the purchase and sale of the Securities, there are no outstanding
options, warrants, scrip rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities,
rights or obligations convertible into or exercisable or
exchangeable for, or giving any Person any right to subscribe for
or acquire, any shares of Common Stock or the capital stock of any
Subsidiary, or contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may
become bound to issue additional shares of Common Stock or Common
Stock Equivalents or capital stock of any Subsidiary. The issuance
and sale of the Securities will not obligate the Company or any
Subsidiary to issue shares of Common Stock or other securities to
any Person (other than the Investors) and will not result in a
right of any holder of Company securities to adjust the exercise,
conversion, exchange or reset price under any of such securities.
There are no outstanding securities or instruments of the Company
or any Subsidiary that contain any redemption or similar
provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may
become bound to redeem a security of the Company or such
Subsidiary. The Company does not have any stock appreciation rights
or “phantom stock” plans or agreements or any similar
plan or agreement. All of the outstanding shares of capital stock
of the Company are duly authorized. All of the outstanding shares
of capital stock of the Company are validly issued, fully paid and
nonassessable, have been issued in compliance with all federal and
state securities laws, and none of such outstanding shares was
issued in violation of any preemptive rights or similar rights to
subscribe for or purchase securities. No further approval or
authorization of any stockholder, the Board of Directors or others
is required for the issuance and sale of the Securities. There are
no stockholders agreements, voting agreements or other similar
agreements with respect to the Company’s capital stock to
which the Company is a party or, to the knowledge of the Company,
between or among any of the Company’s
stockholders.

 

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

 

 

 

 

(l) Material Changes; Undisclosed Events,
Liabilities or Developments. Since the date of the latest
audited financial statements included within the SEC Reports,
except as specifically disclosed in a subsequent SEC Report filed
prior to the date hereof and incorporated into the Base Prospectus,
(i) there has been no event, occurrence or development that has had
or that could reasonably be expected to result in a Material
Adverse Effect, (ii) the Company has not incurred any liabilities
(contingent or otherwise) other than (A) trade payables and accrued
expenses incurred in the ordinary course of business consistent
with past practice and (B) liabilities not required to be reflected
in the Company’s financial statements pursuant to GAAP or
disclosed in filings made with the Commission, (iii) the Company
has not altered its method of accounting, (iv) the Company has not
declared or made any dividend or distribution of cash or other
property to its stockholders or purchased, redeemed or made any
agreements to purchase or redeem any shares of its capital stock
and (v) the Company has not issued any equity securities to any
officer, director or Affiliate, except pursuant to existing Company
stock option plans. The Company does not have pending before the
Commission any request for confidential treatment of information.
Except for the issuance of the Securities contemplated by the Base
Prospectus or disclosed in the Base Prospectus, no event,
liability, fact, circumstance, occurrence or development has
occurred or exists or is reasonably expected to occur or exist with
respect to the Company or its Subsidiaries or their respective
businesses, prospects, properties, operations, assets or financial
condition that would be required to be disclosed by the Company
under applicable securities laws at the time this representation is
made or deemed made that has not been publicly disclosed at least 1
Trading Day prior to the date that this representation is
made.

 

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

 

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

 

(o) Compliance. Neither the Company
nor any Subsidiary: (i) is in default under or in violation of (and
no event has occurred that has not been waived that, with notice or
lapse of time or both, would result in a default by the Company or
any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it
is in violation of, any indenture, loan or credit agreement or any
other agreement or instrument to which it is a party or by which it
or any of its properties is bound (whether or not such default or
violation has been waived), (ii) is in violation of any judgment,
decree or order of any court, arbitrator or governmental authority
or (iii) is or has been in violation of any statute, rule,
ordinance or regulation of any governmental authority, including
without limitation all foreign, federal, state and local laws
relating to taxes, environmental protection, occupational health
and safety, product quality and safety and employment and labor
matters, except in each case as could not have or reasonably be
expected to result in a Material Adverse Effect.

 

(p) Environmental
Laws.                                            The
Company and its Subsidiaries (i) are in compliance with all
federal, state, local and foreign laws relating to pollution or
protection of human health or the environment (including ambient
air, surface water, groundwater, land surface or subsurface
strata), including laws relating to emissions, discharges, releases
or threatened releases of chemicals, pollutants, contaminants, or
toxic or hazardous substances or wastes (collectively,
“Hazardous
Materials”) into the environment, or otherwise
relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous
Materials, as well as all authorizations, codes, decrees, demands,
or demand letters, injunctions, judgments, licenses, notices or
notice letters, orders, permits, plans or regulations, issued,
entered, promulgated or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required
of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms
and conditions of any such permit, license or approval where in
each clause (i), (ii) and (iii), the failure to so comply could be
reasonably expected to have, individually or in the aggregate, a
Material Adverse Effect

 

(q) Regulatory Permits. The Company
and the Subsidiaries possess all certificates, authorizations and
permits issued by the appropriate federal, state, local or foreign
regulatory authorities necessary to conduct their respective
businesses as described in the Time of Sale Disclosure Package,
except where the failure to possess such permits could not
reasonably be expected to result in a Material Adverse Effect
(“Material
Permits”), and neither the Company nor any Subsidiary
has received any notice of proceedings relating to the revocation
or modification of any Material Permit.

 

(r) Title to Assets. The Company
and the Subsidiaries have good and marketable title in fee simple
to all real property owned by them and good and marketable title in
all personal property owned by them that is material to the
business of the Company and the Subsidiaries, in each case free and
clear of all Liens, except for Liens as do not materially affect
the value of such property and do not materially interfere with the
use made and proposed to be made of such property by the Company
and the Subsidiaries and Liens for the payment of federal, state or
other taxes, for which appropriate reserves have been made therefor
in accordance with GAAP and, the payment of which is neither
delinquent nor subject to penalties. Any real property and
facilities held under lease by the Company and the Subsidiaries are
held by them under valid, subsisting and enforceable leases with
which the Company and the Subsidiaries are in
compliance.

 

 

 

 

(s) Patents and Trademarks. The
Company and the Subsidiaries have, or have rights to use, all
patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights,
licenses and other intellectual property rights and similar rights
necessary or material for use in connection with their respective
businesses as described in the SEC Reports and which the failure to
so have could have a Material Adverse Effect (collectively, the
“Intellectual
Property Rights”). None of, and neither the Company
nor any Subsidiary has received a notice (written or otherwise)
that any of, the Intellectual Property Rights has expired,
terminated or been abandoned, or is expected to expire or terminate
or be abandoned, within two (2) years from the date of this
Agreement. Neither the Company nor any Subsidiary has received,
since the date of the latest audited financial statements included
within the SEC Reports, a notice (written or otherwise) of a claim
or otherwise has any knowledge that the Intellectual Property
Rights violate or infringe upon the rights of any Person, except as
would not have a Material Adverse Effect. To the knowledge of the
Company, all such Intellectual Property Rights are enforceable and
there is no existing infringement by another Person of any of the
Intellectual Property Rights. The Company and its Subsidiaries have
taken reasonable security measures to protect the secrecy,
confidentiality and value of all of their intellectual properties,
except where failure to do so could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.

 

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

 

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

 

(v) Sarbanes-Oxley; Internal Accounting
Controls. The Company and the Subsidiaries are in compliance
with any and all applicable requirements of the Sarbanes-Oxley Act
of 2002 that are effective as of the date hereof, and any and all
applicable rules and regulations promulgated by the Commission
thereunder that are effective as of the date hereof and as of the
Closing Date. The Company and the
Subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with
management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences. The Company and the Subsidiaries have
established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the
Subsidiaries and designed such disclosure controls and procedures
to ensure that information required to be disclosed by the Company
in the reports 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. The
Company’s certifying officers have evaluated the
effectiveness of the Company’s disclosure controls and
procedures of the Company and the Subsidiaries as of the end of the
period covered by the Company’s most recently filed periodic
report under the Exchange Act (such date, the
“Evaluation
Date”). The Company
presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on
their evaluations as of the Evaluation Date. Since the Evaluation
Date, there have been no changes in the internal control over
financial reporting (as such term is defined in the Exchange Act)
of the Company and its Subsidiaries that have materially affected,
or is reasonably likely to materially affect, the internal control
over financial reporting of the Company and its
Subsidiaries.

 

(w) Certain Fees. Except as set
forth in the Base Prospectus, no brokerage or finder’s fees
or commissions are or will be payable by the Company to any broker,
financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the
transactions contemplated by this Agreement and the transactions
contemplated pursuant to the Base Prospectus. The Investors shall
have no obligation with respect to any fees or with respect to any
claims made by or on behalf of other Persons for fees of a type
contemplated in this Section that may be due in connection with the
transactions contemplated by this Agreement and the transactions
contemplated pursuant to the Base Prospectus.

 

(x) Investment Company. The Company
is not, and is not an Affiliate of, and immediately after receipt
of payment for the Securities, will not be or be an Affiliate of,
an “investment company” within the meaning of the
Investment Company Act of 1940, as amended. The Company shall
conduct its business in a manner so that it will not become an
“investment company” subject to registration under the
Investment Company Act of 1940, as amended.

 

(y) Registration Rights. No Person
has any right to cause the Company or any Subsidiary to effect the
registration under the Securities Act of any securities of the
Company or any Subsidiary.

 

(z) Listing and Maintenance
Requirements. The Common Stock is registered pursuant to
Section 12(b) or 12(g) of the Exchange Act, and the Company has
taken no action designed to, or which to its knowledge is likely to
have the effect of, terminating the registration of the Common
Stock under the Exchange Act nor has the Company received any
notification that the Commission is contemplating terminating such
registration. The Company has not, in the 12 months preceding the
date hereof, received notice from any Trading Market on which the
Common Stock is or has been listed or quoted to the effect that the
Company is not in compliance with the listing or maintenance
requirements of such Trading Market. The Company is, and has no
reason to believe that it will not in the foreseeable future
continue to be, in compliance with all such listing and maintenance
requirements. The Common Stock is currently eligible for electronic
transfer through the Depository Trust Company or another
established clearing corporation and the Company is current in
payment of the fees to the Depository Trust Company (or such other
established clearing corporation) in connection with such
electronic transfer.

 

 

 

 

(aa) Application
of Takeover Protections. The Company and the Board of
Directors have taken all necessary action, if any, in order to
render inapplicable any control share acquisition, business
combination, poison pill (including any distribution under a rights
agreement) or other similar anti-takeover provision under the
Company’s certificate of incorporation (or similar charter
documents) or the laws of its state of incorporation that is or
could become applicable to the Investors as a result of the
Investors and the Company fulfilling their obligations or
exercising their rights under this Agreement and the transactions
contemplated pursuant to the Prospectus Supplement, including
without limitation as a result of the Company’s issuance of
the Securities and the Investors’ ownership of the
Securities.

 

(bb) Disclosure.
Except with respect to the material terms and conditions of the
transactions contemplated by this Agreement and the transactions
contemplated pursuant to the Base Prospectus, the Company confirms
that neither it nor any other Person acting on its behalf has
provided any of the Investors or their agents or counsel with any
information that it believes constitutes or might constitute
material, non-public information which is not otherwise disclosed
in the Time of Sale Disclosure Package. The Company understands and
confirms that the Investors will rely on the foregoing
representation in effecting transactions in securities of the
Company. All of the disclosure furnished by or on behalf of the
Company to the Investors regarding the Company and, its
Subsidiaries, their respective businesses and the transactions
contemplated hereby, including the Time of Sale Disclosure Package,
is true and correct and does not contain any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements made therein, in light of the circumstances
under which they were made, not misleading. The press releases
disseminated by the Company during the twelve months preceding the
date of this Agreement taken as a whole do not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made and when made, not misleading. 

 

(cc) No
Integrated Offering. Neither the Company, nor any of its
Affiliates, nor any Person acting on its or their behalf has,
directly or indirectly, made any offers or sales of any security or
solicited any offers to buy any security, under circumstances that
would cause this offering of the Securities to be integrated with
prior offerings by the Company for purposes of any applicable
shareholder approval provisions of any Trading Market on which any
of the securities of the Company are listed or
designated.

 

(dd) Solvency.
Based on the consolidated financial condition of the Company as of
each Closing Date, after giving effect to the receipt by the
Company of the proceeds from the sale of the Securities hereunder,
(i) the fair saleable value of the Company’s assets exceeds
the amount that will be required to be paid on or in respect of the
Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the
Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be
conducted including its capital needs taking into account the
particular capital requirements of the business conducted by the
Company, consolidated and projected capital requirements and
capital availability thereof, and (iii) the current cash flow of
the Company, together with the proceeds the Company would receive,
were it to liquidate all of its assets, after taking into account
all anticipated uses of the cash, would be sufficient to pay all
amounts on or in respect of its liabilities when such amounts are
required to be paid. The Company does not intend to incur debts
beyond its ability to pay such debts as they mature (taking into
account the timing and amounts of cash to be payable on or in
respect of its debt). The Company has no knowledge of any facts or
circumstances which lead it to believe that it will file for
reorganization or liquidation under the bankruptcy or
reorganization laws of any jurisdiction within one year from each
Closing Date. The Time of Sale Disclosure Package incorporates as
of the date hereof all outstanding secured and unsecured
Indebtedness of the Company or any Subsidiary, or for which the
Company or any Subsidiary has commitments. For the purposes of this
Agreement, “Indebtedness” means (x)
any liabilities for borrowed money or amounts owed in excess of
$50,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other
contingent obligations in respect of indebtedness of others,
whether or not the same are or should be reflected in the
Company’s consolidated balance sheet (or the notes thereto),
except guaranties by endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary
course of business; and (z) the present value of any lease payments
in excess of $50,000 due under leases required to be capitalized in
accordance with GAAP. Neither the Company nor any Subsidiary is in
default with respect to any Indebtedness.

 

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

 

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

 

 

 

 

(gg) [Reserved.]

 

(hh) Stock
Option Plans. Each stock option granted by the Company under
the Company’s stock option plan was granted (i) in accordance
with the terms of the Company’s stock option plan and (ii)
with an exercise price at least equal to the fair market value of
the Common Stock on the date such stock option would be considered
granted under GAAP and applicable law. No stock option granted
under the Company’s stock option plan has been backdated. The
Company has not knowingly granted, and there is no and has been no
Company policy or practice to knowingly grant, stock options prior
to, or otherwise knowingly coordinate the grant of stock options
with, the release or other public announcement of material
information regarding the Company or its Subsidiaries or their
financial results or prospects.

 

(ii) Accountants.
The Company’s accounting firm is set forth in the
Incorporated Documents. To the knowledge and belief of the Company,
such accounting firm (i) is a registered public accounting firm as
required by the Exchange Act and (ii) shall express its opinion
with respect to the financial statements to be included in the
Company’s Annual Report for the fiscal year ended December
31, 2020.

 

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

 

(kk) Office
of Foreign Assets Control. Neither the Company nor any
Subsidiary, to the Company's knowledge, any director, officer,
agent, employee or affiliate of the Company or any Subsidiary is
currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”).

 

(ll) U.S.
Real Property Holding Corporation. The Company is not and
has never been a U.S. real property holding corporation within the
meaning of Section 897 of the Internal Revenue Code of 1986, as
amended, and the Company shall so certify upon Investor’s
request.

 

(mm) Bank
Holding Company Act. Neither the Company nor any of its
Subsidiaries or Affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”) and to regulation
by the Board of Governors of the Federal Reserve System (the
“Federal
Reserve”). Neither the Company nor any of its
Subsidiaries or Affiliates owns or controls, directly or
indirectly, five percent (5%) or more of the outstanding shares of
any class of voting securities or twenty-five percent or more of
the total equity of a bank or any entity that is subject to the
BHCA and to regulation by the Federal Reserve. Neither the Company
nor any of its Subsidiaries or Affiliates exercises a controlling
influence over the management or policies of a bank or any entity
that is subject to the BHCA and to regulation by the Federal
Reserve.

 

(nn) Money
Laundering. The operations of the Company and its
Subsidiaries 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, applicable money laundering statutes and applicable rules
and regulations thereunder (collectively, the “Money Laundering Laws”),
and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving
the Company with respect to the Money Laundering Laws is pending
or, to the knowledge of the Company, threatened.

 

(oo) Certificates.
Any certificate signed by an officer of the Company and delivered
to the Placement Agent or to counsel for the Placement
Agent shall be deemed to be a representation and warranty by the
Company to the Placement Agent as to the matters set forth
therein.

 

(pp) Reliance.
The Company acknowledges that the Placement Agent will rely
upon the accuracy and truthfulness of the foregoing representations
and warranties and hereby consents to such reliance.

 

(qq) Forward-Looking
Statements. No forward-looking statements (within the
meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act) contained in the Time of Sale Disclosure Package has
been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.

 

(rr) Statistical
or Market-Related Data. Any statistical, industry-related
and market-related data included or incorporated by reference in
the Time of Sale Disclosure Package, are based on or derived from
sources that the Company reasonably and in good faith believes to
be reliable and accurate, and such data agree with the sources from
which they are derived.

 

(ss) FINRA
Affiliations. There are no affiliations with any FINRA
member firm among the Company’s officers, directors or, to
the knowledge of the Company, any five percent (5%) or greater
stockholder of the Company.

 

 

 

 

Section
3. Delivery and Payment. Each Closing shall
occur at the offices of Ellenoff Grossman & Schole LLP, 1345
Avenue of the Americas, New York, New York 10105
(“Placement Agent
Counsel”) (or at such other place as shall be agreed
upon by the Placement Agent and the Company). Subject to the terms
and conditions hereof, at each Closing payment of the purchase
price for the Securities sold on such Closing Date shall be made by
Federal Funds wire transfer, against delivery of such Securities,
and such Securities shall be registered in such name or names and
shall be in such denominations, as the Placement Agent may request
at least one business day before the time of purchase (as defined
below).

 

Deliveries of the
documents with respect to the purchase of the Securities, if any,
shall be made at the offices of Placement Agent Counsel. All
actions taken at a Closing shall be deemed to have occurred
simultaneously.

 

Section
4. Covenants and Agreements of the Company.
The Company further covenants and agrees with the Placement Agent
as follows:

 

(a) Registration Statement Matters.
The Company will advise the Placement Agent promptly after it
receives notice thereof of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Base Prospectus or the Final Prospectus has been
filed and will furnish the Placement Agent with copies thereof. The
Company will file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 14 or 15(d) of the Exchange
Act subsequent to the date of any Prospectus and for so long as the
delivery of a prospectus is required in connection with the
Offering. The Company will advise the Placement Agent, promptly
after it receives notice thereof (i) of any request by the
Commission to amend the Registration Statement or to amend or
supplement any Prospectus or for additional information, and (ii)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any post-effective
amendment thereto or any order directed at any Incorporated
Document, if any, or any amendment or supplement thereto or any
order preventing or suspending the use of the Base Prospectus or
the Final Prospectus or any prospectus supplement or any amendment
or supplement thereto or any post-effective amendment to the
Registration Statement, of the suspension of the qualification of
the Securities for offering or sale in any jurisdiction, of the
institution or threatened institution of any proceeding for any
such purpose, or of any request by the Commission for the amending
or supplementing of the Registration Statement or a Prospectus or
for additional information. The Company shall use its best efforts
to prevent the issuance of any such stop order or prevention or
suspension of such use.  If the Commission shall enter any
such stop order or order or notice of prevention or suspension at
any time, the Company will use its best efforts to obtain the
lifting of such order at the earliest possible moment, or will file
a new registration statement and use its best efforts to have such
new registration statement declared effective as soon as
practicable.  Additionally, the Company agrees that it shall
comply with the provisions of Rules 424(b), 430A, 430B and
430C, as applicable, under the Securities Act, including with
respect to the timely filing of documents thereunder, and will use
its reasonable efforts to confirm that any filings made by the
Company under such Rule 424(b) are received in a timely
manner by the Commission.

 

(b) Blue Sky Compliance. The
Company will cooperate with the Placement Agent and the Investors
in endeavoring to qualify the Securities for sale under the
securities laws of such jurisdictions (United States and foreign)
as the Placement Agent and the Investors may reasonably request and
will make such applications, file such documents, and furnish such
information as may be reasonably required for that purpose,
provided the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in
any jurisdiction where it is not now so qualified or required to
file such a consent, and provided further that the Company shall
not be required to produce any new disclosure document. The Company
will, from time to time, prepare and file such statements, reports
and other documents as are or may be required to continue such
qualifications in effect for so long a period as the Placement
Agent may reasonably request for distribution of the Securities.
The Company will advise the Placement Agent promptly of the
suspension of the qualification or registration of (or any such
exemption relating to) the Securities for offering, sale or trading
in any jurisdiction or any initiation or threat of any proceeding
for any such purpose, and in the event of the issuance of any order
suspending such qualification, registration or exemption, the
Company shall use its best efforts to obtain the withdrawal thereof
at the earliest possible moment.

 

(c) Amendments and Supplements to a
Prospectus and Other Matters. The Company will comply with
the Securities Act and the Exchange Act, and the rules and
regulations of the Commission thereunder, so as to permit the
completion of the distribution of the Securities as contemplated in
this Agreement, the Incorporated Documents and any Prospectus. If
during the period in which a prospectus is required by law to be
delivered in connection with the distribution of Securities
contemplated by the Incorporated Documents or any Prospectus (the
“Prospectus Delivery
Period”), any event shall occur as a result of which,
in the judgment of the Company or in the opinion of the Placement
Agent or counsel for the Placement Agent, it becomes necessary to
amend or supplement the Incorporated Documents or any Prospectus in
order to make the statements therein, in the light of the
circumstances under which they were made, as the case may be, not
misleading, or if it is necessary at any time to amend or
supplement the Incorporated Documents or any Prospectus or to file
under the Exchange Act any Incorporated Document to comply with any
law, the Company will promptly prepare and file with the
Commission, and furnish at its own expense to the Placement Agent
and to dealers, an appropriate amendment to the Registration
Statement or supplement to the Registration Statement, the
Incorporated Documents or any Prospectus that is necessary in order
to make the statements in the Incorporated Documents and any
Prospectus as so amended or supplemented, in the light of the
circumstances under which they were made, as the case may be, not
misleading, or so that the Registration Statement, the Incorporated
Documents or any Prospectus, as so amended or supplemented, will
comply with law. Before amending the Registration Statement or
supplementing the Incorporated Documents or any Prospectus in
connection with the Offering, the Company will furnish the
Placement Agent with a copy of such proposed amendment or
supplement and will not file any such amendment or supplement to
which the Placement Agent reasonably objects.

 

(d) Copies of any Amendments and
Supplements to a Prospectus. The Company will furnish the
Placement Agent, without charge, during the period beginning on the
date hereof and ending on the later of the last Closing Date of the
Offering, as many copies of any Prospectus or prospectus supplement
and any amendments and supplements thereto, as the Placement Agent
may reasonably request.

 

(e) Free Writing Prospectus. The
Company covenants that it will not, unless it obtains the prior
written consent of the Placement Agent, make any offer relating to
the Securities that would constitute an Company Free Writing
Prospectus or that would otherwise constitute a “free writing prospectus”
(as defined in Rule 405 of the Securities Act) required to be filed
by the Company with the Commission or retained by the Company under
Rule 433 of the Securities Act. In the event that the Placement
Agent expressly consents in writing to any such free writing
prospectus (a “Permitted Free Writing
Prospectus”), the Company covenants that it shall (i)
treat each Permitted Free Writing Prospectus as an Company Free
Writing Prospectus, and (ii) comply with the requirements of Rule
164 and 433 of the Securities Act applicable to such Permitted Free
Writing Prospectus, including in respect of timely filing with the
Commission, legending and record keeping.

 

 

 

 

(f) Transfer Agent. The Company
will maintain, at its expense, a registrar and transfer agent for
the Common Stock.

 

(g) Earnings Statement. As soon as
practicable and in accordance with applicable requirements under
the Securities Act, but in any event not later than 18 months after
the last Closing Date, the Company will make generally available to
its security holders and to the Placement Agent an earnings
statement, covering a period of at least 12 consecutive months
beginning after the last Closing Date, that satisfies the
provisions of Section 11(a) and Rule 158 under the Securities
Act.

 

(h) Periodic Reporting Obligations.
During the Prospectus Delivery Period, the Company will duly file,
on a timely basis, with the Commission and the Trading Market all
reports and documents required to be filed under the Exchange Act
within the time periods and in the manner required by the Exchange
Act.

 

(i) Additional
Documents. The
Company will enter into any subscription, purchase or other
customary agreements as the Placement Agent or the Investors deem
necessary or appropriate to consummate the Offering, all of which
will be in form and substance reasonably acceptable to the
Placement Agent and the Investors. The Company agrees that the
Placement Agent may rely upon, and each is a third party
beneficiary of, the representations and warranties, and applicable
covenants, set forth in any such purchase, subscription or other
agreement with Investors in the Offering.

 

(j) No Manipulation of
Price.  The
Company will not take, directly or indirectly, any action designed
to cause or result in, or that has constituted or might reasonably
be expected to constitute, the stabilization or manipulation of the
price of any securities of the Company.

 

(k) Acknowledgment. The Company
acknowledges that any advice given by the Placement Agent to the
Company is solely for the benefit and use of the Board of Directors
of the Company and may not be used, reproduced, disseminated,
quoted or referred to, without the Placement Agent's prior written
consent.

 

(l) Announcement of Offering. The
Company acknowledges and agrees that the Placement Agent may,
subsequent to the Closing, make public its involvement with the
Offering.

 

(m) Reliance on Others. The Company
confirms that it will rely on its own counsel and accountants for
legal and accounting advice.

 

(n) Research Matters. By entering into this
Agreement, the Placement Agent does not provide any promise, either
explicitly or implicitly, of favorable or continued research
coverage of the Company and the Company hereby acknowledges and
agrees that the Placement Agent’s selection as a placement
agent for the Offering was in no way conditioned, explicitly or
implicitly, on the Placement Agent providing favorable or any
research coverage of the Company. In accordance with FINRA Rule
2711(e), the parties acknowledge and agree that the Placement Agent
has not directly or indirectly offered
favorable research, a specific rating or a specific price target,
or threatened to change research, a rating or a price target, to
the Company or inducement for the receipt of business or
compensation.

 

Section
5. Conditions of the Obligations of the Placement
Agent. The obligations of the Placement Agent hereunder
shall be subject to the accuracy of the representations and
warranties on the part of the Company set forth in Section 2
hereof, in each case as of the date hereof and as of each Closing
Date as though then made, to the timely performance by each of the
Company of its covenants and other obligations hereunder on and as
of such dates, and to each of the following additional
conditions:

 

(a) Reserved.

 

(b) Compliance with Registration
Requirements; No Stop Order; No Objection from the FINRA.
Each Prospectus (in accordance with Rule 424(b)) and
“free writing
prospectus” (as defined in Rule 405 of the Securities
Act), if any, shall have been duly filed with the Commission, as
appropriate; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued
and no proceeding for that purpose shall have been initiated or
threatened by the Commission; no order preventing or suspending the
use of any Prospectus shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; no order having the effect of ceasing or suspending the
distribution of the Securities or any other securities of the
Company shall have been issued by any securities commission,
securities regulatory authority or stock exchange and no
proceedings for that purpose shall have been instituted or shall be
pending or, to the knowledge of the Company, contemplated by any
securities commission, securities regulatory authority or stock
exchange; all requests for additional information on the part of
the Commission shall have been complied with; and the FINRA shall
have raised no objection to the fairness and reasonableness of the
placement terms and arrangements.

 

(c) Corporate Proceedings. All
corporate proceedings and other legal matters in connection with
this Agreement, the Registration Statement and each Prospectus, and
the registration, sale and delivery of the Securities, shall have
been completed or resolved in a manner reasonably satisfactory to
the Placement Agent's counsel, and such counsel shall have been
furnished with such papers and information as it may reasonably
have requested to enable such counsel to pass upon the matters
referred to in this Section 5.

 

(d) No Material Adverse Change.
Subsequent to the execution and delivery of this Agreement and
prior to each Closing Date, in the Placement Agent's sole judgment
after consultation with the Company, there shall not have occurred
any Material Adverse Effect or any material adverse change or
development involving a prospective material adverse change in the
condition or the business activities, financial or otherwise, of
the Company from the latest dates as of which such condition is set
forth in the Registration Statement and Prospectus
(“Material Adverse
Change”).

 

 

 

 

(e) Opinion of Counsel for the
Company. The Placement Agent shall have received on each
Closing Date the favorable opinion of US legal counsel to the
Company, dated as of such Closing Date, including, without
limitation, a negative assurance letter addressed to the Placement
Agent and in form and substance satisfactory to the Placement
Agent.

 

(f) Officers’ Certificate.
The Placement Agent shall have received on each Closing Date a
certificate of the Company, dated as of such Closing Date, signed
by the Chief Executive Officer and Chief Financial Officer of the
Company, to the effect that, and the Placement Agent shall be
satisfied that, the signers of such certificate have reviewed the
Registration Statement, the Incorporated Documents, any Prospectus
Supplement, and this Agreement and to the further effect
that:

 

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

 

(ii) No
stop order suspending the effectiveness of the Registration
Statement or the use of any Prospectus has been issued and no
proceedings for that purpose have been instituted or are pending
or, to the Company’s knowledge, threatened under the
Securities Act; no order having the effect of ceasing or suspending
the distribution of the Securities or any other securities of the
Company has been issued by any securities commission, securities
regulatory authority or stock exchange in the United States and no
proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, contemplated by any securities
commission, securities regulatory authority or stock exchange in
the United States;

 

(iii) When
the Registration Statement became effective, at the time of sale,
and at all times subsequent thereto up to the delivery of such
certificate, the Registration Statement and the Incorporated
Documents, if any, when such documents became effective or were
filed with the Commission, and any Prospectus, contained all
material information required to be included therein by the
Securities Act and the Exchange Act and the applicable rules and
regulations of the Commission thereunder, as the case may be, and
in all material respects conformed to the requirements of the
Securities Act and the Exchange Act and the applicable rules and
regulations of the Commission thereunder, as the case may be, and
the Registration Statement and the Incorporated Documents, if any,
and any Prospectus, did not and do not include any 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, in the
light of the circumstances under which they were made, not
misleading (provided, however, that the preceding representations
and warranties contained in this paragraph (iii) shall not apply to
any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by the
Placement Agent expressly for use therein) and, since the effective
date of the Registration Statement, there has occurred no event
required by the Securities Act and the rules and regulations of the
Commission thereunder to be set forth in the Incorporated Documents
which has not been so set forth; and

 

(iv) Subsequent
to the respective dates as of which information is given in the
Registration Statement, the Incorporated Documents and any
Prospectus, there has not been: (a) any Material Adverse Change;
(b) any transaction that is material to the Company and the
Subsidiaries taken as a whole, except transactions entered into in
the ordinary course of business; (c) any obligation, direct or
contingent, that is material to the Company and the Subsidiaries
taken as a whole, incurred by the Company or any Subsidiary, except
obligations incurred in the ordinary course of business; (d) any
material change in the capital stock (except changes thereto
resulting from the exercise of outstanding stock options or
warrants) or outstanding indebtedness of the Company or any
Subsidiary; (e) any dividend or distribution of any kind declared,
paid or made on the capital stock of the Company; or (f) any loss
or damage (whether or not insured) to the property of the Company
or any Subsidiary which has been sustained or will have been
sustained which has a Material Adverse Effect.

 

(g) Bring-down Comfort
Letter.  On
each Closing Date, the Placement Agent shall have received
from Assure CPA, LLC, or such other independent registered
public accounting firm of the Company, a letter dated as of such
Closing Date, in form and substance satisfactory to
the Placement Agent, to the effect that they reaffirm the
statements made in the letter furnished pursuant to
subsection (a) of this Section 5, except that the
specified date referred to therein for the carrying out of
procedures shall be no more than two business days prior
to such Closing Date.

 

(h) Stock Exchange Listing. The
Common Stock shall be registered under the Exchange Act and shall
be listed on the Trading Market, and the Company shall not have
taken any action designed to terminate, or likely to have the
effect of terminating, the registration of the Common Stock
under the Exchange Act or delisting or suspending from trading the
Common Stock from the Trading Market, nor shall the Company have
received any information suggesting that the Commission or the
Trading Market is contemplating terminating such registration or
listing.

 

(i) Lock-Up Agreements. On the
Closing Date, the Placement Agent shall have received the executed
lock-up agreement, in the form attached hereto as Exhibit A, from each of the
directors and officers of the Company.

 

(j) Additional Documents. On or
before each Closing Date, the Placement Agent and counsel for the
Placement Agent shall have received such information and documents
as they may reasonably require for the purposes of enabling them to
pass upon the issuance and sale of the Securities as contemplated
herein, or in order to evidence the accuracy of any of the
representations and warranties, or the satisfaction of any of the
conditions or agreements, herein contained.

 

If any
condition specified in this Section 5 is not satisfied when and as
required to be satisfied, this Agreement may be terminated by the
Placement Agent by notice to the Company at any time on or prior to
a Closing Date, which termination shall be without liability on the
part of any party to any other party, except that Section 6
(Payment of Expenses), Section 7 (Indemnification and Contribution)
and Section 8 (Representations and Indemnities to Survive Delivery)
shall at all times be effective and shall survive such
termination.

 

 

 

 

Section
6. Payment of Expenses. The Company agrees
to pay all costs, fees and expenses incurred by the Company in
connection with the performance of its obligations hereunder and in
connection with the transactions contemplated hereby, including,
without limitation: (i) all expenses incident to the issuance,
delivery and qualification of the Securities (including all
printing and engraving costs); (ii) all fees and expenses of the
registrar and transfer agent of the Common Stock; (iii) all
necessary issue, transfer and other stamp taxes in connection with
the issuance and sale of the Securities; (iv) all fees and
expenses of the Company’s counsel, independent public or
certified public accountants and other advisors; (v) all costs and
expenses incurred in connection with the preparation, printing,
filing, shipping and distribution of the Registration Statement
(including financial statements, exhibits, schedules, consents and
certificates of experts), the Base Prospectus, the Final Prospectus
and each Prospectus Supplement, and all amendments and supplements
thereto, and this Agreement; (vi) all filing fees, reasonable
attorneys’ fees and expenses incurred by the Company or the
Placement Agent in connection with qualifying or registering (or
obtaining exemptions from the qualification or registration of) all
or any part of the Securities for offer and sale under the state
securities or blue sky laws or the securities laws of any other
country, and, if requested by the Placement Agent, preparing and
printing a “Blue Sky
Survey,” an “International Blue Sky
Survey” or other memorandum, and any supplements
thereto, advising the Placement Agent of such qualifications,
registrations and exemptions; (vii) if applicable, the filing fees
incident to the review and approval by the FINRA of the Placement
Agent's participation in the offering and distribution of the
Securities; (viii) the fees and expenses associated with including
the Shares on the Trading Market; (ix) all costs and expenses
incident to the travel and accommodation of the Company’s and
the Placement Agent's employees on the “roadshow,” if any; and
(x) all other fees, costs and expenses referred to in Part II of
the Registration Statement.

 

Section
7. Indemnification and
Contribution.

 

(a) The
Company agrees to indemnify and hold harmless the Placement Agent,
its affiliates and each person controlling the Placement
Agent (within the
meaning of Section 15 of the Securities Act), and the directors,
officers, agents and employees of the Placement Agent, its
affiliates and each such controlling person (the Placement Agent,
and each such entity or person. an “Indemnified Person”) from
and against any losses, claims, damages, judgments, assessments,
costs and other liabilities (collectively, the “Liabilities”), and shall
reimburse each Indemnified Person for all fees and expenses
(including the reasonable fees and expenses of one counsel for all
Indemnified Persons, except as otherwise expressly provided herein)
(collectively, the “Expenses”) as they are
incurred by an Indemnified Person in investigating, preparing,
pursuing or defending any Actions, whether or not any Indemnified
Person is a party thereto, (i) caused by, or arising out of or in
connection with, any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement, any
Incorporated Document, or any Prospectus or by any omission or
alleged omission to state therein a material fact necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading (other than untrue statements or
alleged untrue statements in, or omissions or alleged omissions
from, information relating to an Indemnified Person furnished in
writing by or on behalf of such Indemnified Person expressly for
use in the Incorporated Documents) or (ii) otherwise arising out of
or in connection with advice or services rendered or to be rendered
by any Indemnified Person pursuant to this Agreement, the
transactions contemplated thereby or any Indemnified Person's
actions or inactions in connection with any such advice, services
or transactions; provided, however, that, in the case of
clause (ii) only, the Company shall not be responsible for any
Liabilities or Expenses of any Indemnified Person that are finally
judicially determined to have resulted solely from such Indemnified
Person's (x) gross negligence or willful misconduct in connection
with any of the advice, actions, inactions or services referred to
above or (y) use of any offering materials or information
concerning the Company in connection with the offer or sale of the
Securities in the Offering which were not authorized for such use
by the Company and which use constitutes gross negligence or
willful misconduct. The Company also agrees to reimburse each
Indemnified Person for all Expenses as they are incurred in
connection with enforcing such Indemnified Person's rights under
this Agreement.

 

(b)           Upon
receipt by an Indemnified Person of actual notice of an Action
against such Indemnified Person with respect to which indemnity may
be sought under this Agreement, such Indemnified Person shall
promptly notify the Company in writing; provided that failure by
any Indemnified Person so to notify the Company shall not relieve
the Company from any liability which the Company may have on
account of this indemnity or otherwise to such Indemnified Person,
except to the extent the Company shall have been prejudiced by such
failure. The Company shall, if requested by the Placement Agent,
assume the defense of any such Action including the employment of
counsel reasonably satisfactory to the Placement Agent, which
counsel may also be counsel to the Company. Any Indemnified Person
shall have the right to employ separate counsel in any such action
and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Person
unless: (i) the Company has failed promptly to assume the defense
and employ counsel or (ii) the named parties to any such Action
(including any impeded parties) include such Indemnified Person and
the Company, and such Indemnified Person shall have been advised in
the reasonable opinion of counsel that there is an actual conflict
of interest that prevents the counsel selected by the Company from
representing both the Company (or another client of such counsel)
and any Indemnified Person; provided that the Company shall not in
such event be responsible hereunder for the fees and expenses of
more than one firm of separate counsel for all Indemnified Persons
in connection with any Action or related Actions, in addition to
any local counsel. The Company shall not be liable for any
settlement of any Action effected without its written consent
(which shall not be unreasonably withheld). In addition, the
Company shall not, without the prior written consent of the
Placement Agent (which shall not be unreasonably withheld), settle,
compromise or consent to the entry of any judgment in or otherwise
seek to terminate any pending or threatened Action in respect of
which indemnification or contribution may be sought hereunder
(whether or not such Indemnified Person is a party thereto) unless
such settlement, compromise, consent or termination includes an
unconditional release of each Indemnified Person from all
Liabilities arising out of such Action for which indemnification or
contribution may be sought hereunder. The indemnification required
hereby shall be made by periodic payments of the amount thereof
during the course of the investigation or defense, as such expense,
loss, damage or liability is incurred and is due and
payable.

 

(c)           In
the event that the foregoing indemnity is unavailable to an
Indemnified Person other than in accordance with this Agreement,
the Company shall contribute to the Liabilities and Expenses paid
or payable by such Indemnified Person in such proportion as is
appropriate to reflect (i) the relative benefits to the Company, on
the one hand, and to the Placement Agent and any other Indemnified
Person, on the other hand, of the matters contemplated by this
Agreement or (ii) if the allocation provided by the immediately
preceding clause is not permitted by applicable law, not only such
relative benefits but also the relative fault of the Company, on
the one hand, and the Placement Agent and any other Indemnified
Person, on the other hand, in connection with the matters as to
which such Liabilities or Expenses relate, as well as any other
relevant equitable considerations; provided that in no event shall
the Company contribute less than the amount necessary to ensure
that all Indemnified Persons, in the aggregate, are not liable for
any Liabilities and Expenses in excess of the amount of fees
actually received by the Placement Agent pursuant to this
Agreement. For purposes of this paragraph, the relative benefits to
the Company, on the one hand, and to the Placement Agent on the
other hand, of the matters contemplated by this Agreement shall be
deemed to be in the same proportion as (a) the total value paid or
contemplated to be paid to or received or contemplated to be
received by the Company in the transaction or transactions that are
within the scope of this Agreement, whether or not any such
transaction is consummated, bears to (b) the fees paid to the
Placement Agent under this Agreement. Notwithstanding the above, no
person guilty of fraudulent misrepresentation within the meaning of
Section 11(f) of the Securities Act, as amended, shall be entitled
to contribution from a party who was not guilty of fraudulent
misrepresentation.

 

(d)           The
Company also agrees that no Indemnified Person shall have any
liability (whether direct or indirect, in contract or tort or
otherwise) to the Company for or in connection with advice or
services rendered or to be rendered by any Indemnified Person
pursuant to this Agreement, the transactions contemplated thereby
or any Indemnified Person's actions or inactions in connection with
any such advice, services or transactions except for Liabilities
(and related Expenses) of the Company that are finally judicially
determined to have resulted solely from such Indemnified Person's
gross negligence or willful misconduct in connection with any such
advice, actions, inactions or services.

 

 

 

 

(e)           The
reimbursement, indemnity and contribution obligations of the
Company set forth herein shall apply to any modification of this
Agreement and shall remain in full force and effect regardless of
any termination of, or the completion of any Indemnified Person's
services under or in connection with, this Agreement.

 

Section
8. Representations and Indemnities to Survive
Delivery. The respective indemnities, agreements,
representations, warranties and other statements of the Company or
any person controlling the Company, of its officers, and of the
Placement Agent set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any
investigation made by or on behalf of the Placement Agent, the
Company, or any of its or their partners, officers or directors or
any controlling person, as the case may be, and will survive
delivery of and payment for the Securities sold hereunder and any
termination of this Agreement. A successor to a Placement Agent, or
to the Company, its directors or officers or any person controlling
the Company, shall be entitled to the benefits of the indemnity,
contribution and reimbursement agreements contained in this
Agreement.

 

Section
9. Notices. All communications hereunder
shall be in writing and shall be mailed, hand delivered, e-mailed
or telecopied and confirmed to the parties hereto as
follows:

 

If to
the Placement Agent to the address set forth above, attention: Head
of Equity Capital Markets, e-mail: rothecm@roth.com

 

With a copy to:

 

Ellenoff
Grossman & Schole LLP

1345
Avenue of the Americas, 11th Floor

New
York, New York 10105

E-mail:
capmkts@egsllp.com

Attention:
Robert Charron

 

If to
the Company:

 

United
States Antimony Corporation

P.O.
Box 643

Thompson
Falls, Montana 59873

Facsimile:
(406) 827-3543

Attention:
Chief Executive Officer

 

With a copy to:

 

Pryor
Cashman LLP

7 Times
Square

New
York, New York 10036

Facsimile:
(212) 326-0806

Attention:
M. Ali Panjwani, Esq.

 

Any
party hereto may change the address for receipt of communications
by giving written notice to the others.

 

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

 

 

 

 

Section
11. Partial Unenforceability. The invalidity
or unenforceability of any section, paragraph or provision of this
Agreement shall not affect the validity or enforceability of any
other section, paragraph or provision hereof. If any Section,
paragraph or provision of this Agreement is for any reason
determined to be invalid or unenforceable, there shall be deemed to
be made such minor changes (and only such minor changes) as are
necessary to make it valid and enforceable.

 

Section
12. Governing Law Provisions. This Agreement
shall be deemed to have been made and delivered in New York City
and both this engagement letter and the transactions contemplated
hereby shall be governed as to validity, interpretation,
construction, effect and in all other respects by the internal laws
of the State of New York, without regard to the conflict of laws
principles thereof. Each of the Placement Agent and the Company:
(i) agrees that any legal suit, action or proceeding arising out of
or relating to this engagement letter and/or the transactions
contemplated hereby shall be instituted exclusively in New York
Supreme Court, County of New York, or in the United States District
Court for the Southern District of New York, (ii) waives any
objection which it may have or hereafter to the venue of any such
suit, action or proceeding, and (iii) irrevocably consents to the
jurisdiction of the New York Supreme Court, County of New York, and
the United States District Court for the Southern District of New
York in any such suit, action or proceeding. Each of the Placement
Agent and the Company further agrees to accept and acknowledge
service of any and all process which may be served in any such
suit, action or proceeding in the New York Supreme Court, County of
New York, or in the United States District Court for the Southern
District of New York and agrees that service of process upon the
Company mailed by certified mail to the Company’s address
shall be deemed in every respect effective service of process upon
the Company, in any such suit, action or proceeding, and service of
process upon the Placement Agent mailed by certified mail to the
Placement Agent’s address shall be deemed in every respect
effective service process upon the Placement Agent, in any such
suit, action or proceeding. Notwithstanding any provision of this
engagement letter to the contrary, the Company agrees that neither
the Placement Agent nor its affiliates, and the respective
officers, directors, employees, agents and representatives of the
Placement Agent, its affiliates and each other person, if any,
controlling the Placement Agent or any of its affiliates, shall
have any liability (whether direct or indirect, in contract or tort
or otherwise) to the Company for or in connection with the
engagement and transaction described herein except for any such
liability for losses, claims, damages or liabilities incurred by us
that are finally judicially determined to have resulted from the
willful misconduct or gross negligence of such individuals or
entities. If either party shall commence an action or proceeding to
enforce any provision of this Agreement, then the prevailing party
in such action or proceeding shall be reimbursed by the other party
for its reasonable attorney’s fees and other costs and
expenses incurred with the investigation, preparation and
prosecution of such action or proceeding.

 

Section
13. General Provisions.

 

(a)           This
Agreement constitutes the entire agreement of the parties to this
Agreement and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be
executed in two or more counterparts, each one of which shall be an
original, with the same effect as if the signatures thereto and
hereto were upon the same instrument. This Agreement may not be
amended or modified unless in writing by all of the parties hereto,
and no condition herein (express or implied) may be waived unless
waived in writing by each party whom the condition is meant to
benefit. Section headings herein are for the convenience of the
parties only and shall not affect the construction or
interpretation of this Agreement. Notwithstanding anything herein
to the contrary, the Engagement Agreement, dated July 6, 2020 (the
“Engagement
Agreement”), by and between the Company and the
Placement Agent, shall continue to be effective and the terms
therein shall continue to survive and be enforceable by the
Placement Agent in accordance with its terms, provided that, in the
event of a conflict between the terms of the Engagement Agreement
and this Agreement, the terms of this Agreement shall
prevail.

 

(b)           The
Company acknowledges that in connection with the offering of the
Securities: (i) the Placement Agent has acted at arms length, are
not agents of, and owe no fiduciary duties to the Company or any
other person, (ii) the Placement Agent owes the Company only those
duties and obligations set forth in this Agreement and (iii) the
Placement Agent may have interests that differ from those of the
Company. The Company waives to the full extent permitted by
applicable law any claims it may have against the Placement Agent
arising from an alleged breach of fiduciary duty in connection with
the offering of the Securities

 

[The
remainder of this page has been intentionally left
blank.]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

If the
foregoing is in accordance with your understanding of our
agreement, please sign below whereupon this instrument, along with
all counterparts hereof, shall become a binding agreement in
accordance with its terms.

 

Very
truly yours,

 

UNITED STATES ANTIMONY CORPORATION, a
Montana corporation

 

 

By: /s/
John C. Gustavsen
                                                       

Name:
John C.
Gustavsen

Title:
Interim Chief Executive Officer

 

 

 

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

 

 

	

 

	

ROTH CAPITAL PARTNERS, LLC

	

 

	

 

	

 

	

 

	

 

	

	
By:  

	
/s/ Aaron
Gurewitz

	

 

	

 

	

 

	
Aaron
Gurewitz
	

 

	

 

	

 

	Head of Equity
Capital Markets

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00321-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00321-of-00352.parquet"}]]