UNDERWRITING AGREEMENT between PYXIS TANKERS INC. and THINKEQUITY, A DIVISION OF FORDHAM FINANCIAL MANAGEMENT, INC., as Representative of the Several Underwriters
Exhibit 1.1
between
and
THINKEQUITY,
A DIVISION OF FORDHAM FINANCIAL MANAGEMENT, INC.,
as Representative of the Several Underwriters
ThinkEquity,
A Division of Fordham Financial Management, Inc.
As Representative of the several Underwriters named on Schedule 1 attached hereto
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As Representative of the several Underwriters named on Schedule 1 attached hereto
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Ladies and Gentlemen:
The undersigned, Pyxis Tankers Inc., a corporation formed under the laws of the Republic of the ▇▇▇▇▇▇▇▇ Islands
(collectively with its subsidiaries and affiliates, including, without limitation, all entities disclosed or described in the Registration Statement (as hereinafter defined) as being subsidiaries or affiliates of Pyxis Tankers Inc., the “Company”), hereby confirms its agreement (this “Agreement”) with ThinkEquity, a division of Fordham Financial Management, Inc. (hereinafter referred to as “you” (including
its correlatives) or the “Representative”), and with the other underwriters named on Schedule 1 hereto for which the Representative is acting as representative (the Representative and such other
underwriters being collectively called the “Underwriters” or, individually, an “Underwriter”) as follows:
| 1. |
Purchase and Sale of Shares.
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1.1 Firm Securities.
1.1.1 Nature and Purchase of Firm
Securities.
(i) On the basis of the
representations and warranties herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell to the several Underwriters, an aggregate of shares (“Firm
Shares”) of its 7.75% Series A Cumulative Convertible Preferred Shares, par value $0.001 per share (which we refer to as the “Series A Preferred Shares”). Each Series A Preferred Shares initially
convertible into 17.86 shares (the "Preferred Conversion Shares") of the Company's common shares par value $0.001 per share (the "Common
Shares"), subject to adustments. Each Firm Share will be accompanied by [__] immediately detachable warrants, with each warrant being exercisable to purchase [__] share of the Common Shares at an exercise price of $1.40 per Common Share (the “Firm Warrants”). The Firm Shares and the Firm Warrants are collectively referred to as the “Firm Securities.”
(ii) The Underwriters, severally
and not jointly, agree to purchase from the Company the number of Firm Securities set forth opposite their respective names on Schedule 1 attached hereto and made a part hereof at a purchase price of $[____] per share (92.5% of the per Firm
Share offering price, reflecting the Underwriters’ discount). The Firm Securities are to be offered initially to the public at the offering price set forth on the cover page of the Prospectus (as defined in Section 2.1.1 hereof).
1.1.2 Shares Payment and Delivery.
(i) Delivery
and payment for the Firm Securities shall be made at 10:00 a.m., Eastern time, on the second (2nd) Business Day following the date of this Agreement (or the third (3rd) Business Day following the date of this Agreement if this Agreement is executed by all parties after 4:01
p.m., Eastern time) or at such earlier time as shall be agreed upon by the Representative and the Company, at the offices of Gracin
& ▇▇▇▇▇▇, LLP, The Chrysler Building, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (“Representative’s Counsel”), or at such other place (or remotely by facsimile or other electronic
transmission) as shall be agreed upon by the Representative and the Company. The hour and date of delivery and payment for the Firm Securities is called the “Closing Date.”
(ii) Payment
for the Firm Securities shall be made on the Closing Date by wire transfer in Federal (same day) funds, payable to the order of the Company against delivery of the Firm Shares and the Warrants through the facilities of the Depository Trust
Company (“DTC”) for the account of the Underwriters. The Firm Shares and Firm Warrants shall be registered in such name or names and in such authorized
denominations as the Representative may request in writing at least two (2) full Business Days prior to the Closing Date. The Company shall not be obligated to sell or deliver the Firm Securities except upon tender of payment by the
Representative for all of the Securities. The term “Business Day” means any day other than a Saturday, a Sunday or a legal holiday or a day on which
banking institutions are authorized or obligated by law to close in New York, New York.
1.2 Over-allotment Option.
1.2.1 Option
Securities. For the purposes of covering any over-allotments in connection with the distribution and sale of the Firm Securities, the Company hereby grants to the Underwriters an option to purchase from
the Company up to additional Series A Preferred Shares, representing fifteen percent (15%) of the Firm Shares sold in the offering and/or up to additional Warrants, representing fifteen percent (15%)
of the Firm Warrants sold in the offering, from the Company (the “Over-allotment Option”). Such additional Series A Preferred
Shares, the net proceeds of which will be deposited in the Company’s account, are hereinafter referred to as “Option Shares,” and such
additional Warrants are hereinafter referred to as “Option Warrants,” and collectively as the “Option Securities.” The purchase price to be paid per Option Share shall be $[●] and the purchase price per Option Warrant shall be $0.00925. The Firm Shares, the Option Shares and the
Preferred Conversion Shares issuable upon conversion of the Firm Shares and the Option Shares are hereinafter referred together as the “Public Shares,”
and the Firm Warrants, Option Warrants and the Common Shares issuable upon exercise of the Firm Warrants and the
Option Warrants are hereinafter referred to as the “Public Warrants.” The Firm Securities and the Option Securities are hereinafter referred to
together as the “Public Securities.” The offering and sale of the Public Securities is hereinafter referred to as the “Offering.”
1.2.2 Exercise of Over-allotment
Option. The Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representative as to all (at
any time) or any part (from time to time) of the Option Securities within 45 days after the date of this Agreement. The Underwriters shall not be under any obligation to purchase any Option Securities prior to the exercise of the Over-allotment
Option. The Over-allotment Option granted hereby may be exercised by the giving of oral notice to the Company from the Representative, which must be confirmed in writing by overnight mail or facsimile or other electronic transmission setting
forth the number and type of Option Securities to be purchased and the date and time for delivery of and payment for the Option Securities (the “Option Closing Date”), which shall not be later than two (2) Business Days after the date of the notice or such other time as shall be agreed upon by the Company and the Representative, at the offices of Representative’s Counsel or at such other place
(including remotely by facsimile or other electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Securities does not occur on the Closing Date, the Option Closing Date
will be as set forth in the notice. Upon exercise of the Over-allotment Option with respect to all or any portion of the Option Securities, subject to the terms and conditions set forth herein, (i) the Company shall become obligated to sell to
the Underwriters the number and type of Option Securities specified in such notice and (ii) each of the Underwriters, acting severally and not jointly, shall purchase that portion of the total number of Option Securities then being purchased as
set forth in Schedule 1 opposite the name of such Underwriter.
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1.2.3 Payment and Delivery. Payment for the Option Securities shall be made on the Option Closing Date by wire transfer in Federal (same day) funds, payable to the order of the Company against delivery to you of the Option Securities through the
facilities of DTC for the account of the Underwriters. The Option Securities shall be registered in such name or names and in such authorized denominations as the Representative may request in writing at least one (1) full Business Day prior to
the Option Closing Date. The Company shall not be obligated to sell or deliver the Option Securities except upon tender of payment by the Representative for the applicable Option Shares.
1.3 Underwriter’s Warrants.
1.3.1. Purchase Warrants. The
Company hereby agrees to issue and sell to the Representative (and/or its designees) on the Closing Date two separate warrants (the "Underwriter's Warrants") for an aggregate purchase price of $100.00. The
first of the Underwriter's Warrants is a warrant for the purchase of an aggregate of [ ] Series A Preferred Shares, representing a total equal to 1% of the Firm Shares (the "Underwriter's Firm Warrants for Preferred Shares"). The second of the Underwriter's Warrants is a warrant for the purchase of an aggregate of [ ] warrants each exercisable into one Common Share, representing a total equal to
1% of the Firm Warrants (the "Underwriter's Firm Warrants for Common Shares Warrants"). The warrant agreement for the Underwriter's Firm Warrants for Preferred Shares, in
the form attached hereto as Exhibit A-1 (the "Underwriter's Warrant Agreement for Series A Preferred Shares"), shall be exercisable, in whole or in part, commencing on a date which is one hundred eighty
(180) days after the effective date (the "Effective Date") of the Registration Statement (as defined in Section 2.1.1 below) and expiring on the five-year anniversary of the Effective Date at an
initial exercise price per Series A Preferred Share of $24.92. The warrant agreement for the Underwriter's Firm Warrants for Common Share Warrants, in the form attached hereto as Exhibit A-2 (the "Underwriter's
Warrant Agreement for Common Share Warrants", and together with the Underwriter's Warrant Agreement for Series A Preferred Shares, the "Underwriter's Warrant Agreements"), shall be exercisable, in
whole or in part, commencing on a date which is one hundred eighty (180) days after the Effective Date and expiring on the five-year anniversary of the Effective Date at an initial exercise price per Underwriter's Firm Warrant for Common Shares
Warrants of $0.01. Underlying each Underwriter's Firm Warrant for Common Shares Warrant shall be a common share warrant with the same terms and conditions of the Public Warrants (defined above), including,
the initial Exercise Price (as such term is defined in the Public Warrant) of the common share warrants shall be $1.40 per Common Share. The Underwriter's Warrant Agreements and the Series A Preferred Shares and warrants issuable upon exercise
thereof and the Preferred Conversion Shares issuable upon exercise of the Underwriter's Firm Warrants for Preferred Shares and the Common Shares issuable upon conversion of such Preferred Shares and the Common Shares isssuable upon exercise of the
Underwriter's Firm Warrants for Common Shares Warrants are hereinafter referred to together as the "Underwriter's Securities." The Representative understands and agrees that there are significant restrictions
pursuant to FINRA Rule 5110 against transferring the Underwriter's Warrants and the underlying Series A Preferred Shares and warrants during the one hundred eighty (180) days immediately following the Effective Date and by its acceptance thereof
shall agree that the Underwriter's Warrants and the Series A Preferred Shares and warrants shall not be sold during the Offering, or sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put,
or call transaction that would result in the effective economic disposition of the Underwriter's Warrants or the underlying Series A Preferred Shares and warrants by any person for a period of one hundred eighty (180) days immediately following the
Effective Date, except as provided for in FINRA Rule 5110(g)(2).
1.3.2. Delivery. Delivery of the
Underwriter’s Warrant Agreements shall be made on the Closing Date and shall be issued in the name or names and in such authorized denominations as the Representative may request.
2. Representations and Warranties of the Company.
The Company represents and warrants to the Underwriters as of the Applicable Time (as defined below), as of the Closing Date and as of the Option Closing Date, if any, as follows:
2.1 Filing of Registration
Statement.
2.1.1 Pursuant to the Securities Act.
The Company has filed with the U.S. Securities and Exchange Commission (the “Commission”) a registration statement, and an amendment or amendments thereto, on Form F-1 (File No. 333-245405), including any
related prospectus or prospectuses, for the registration of the Public Securities and the Underwriter’s Securities under the Securities Act of 1933, as amended (the “Securities Act”), which registration
statement and amendment or amendments have been prepared by the Company in all material respects in conformity with the requirements of the Securities Act and the rules and regulations of the Commission under the Securities Act (the “Securities Act Regulations”) and will contain all material statements that are required to be stated therein in accordance with the Securities Act and the Securities Act Regulations. Except as the context may
otherwise require, such registration statement, as amended, on file with the Commission at the time the registration statement
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became effective (including the Preliminary Prospectus included in the registration statement, financial statements, schedules, exhibits
and all other documents filed as a part thereof or incorporated therein and all information deemed to be a part thereof as of the Effective Date pursuant to paragraph (b) of Rule 430A of the Securities Act Regulations (the “Rule 430A Information”)), is referred to herein as the “Registration Statement.” If the Company files any registration statement pursuant to Rule 462(b) of the Securities Act Regulations, then after such filing, the term “Registration
Statement” shall include such registration statement filed pursuant to Rule 462(b). The Registration Statement has been declared effective by the Commission on the date hereof.
Each prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted the
Rule 430A Information that was used after such effectiveness and prior to the execution and delivery of this Agreement, is herein called a “Preliminary Prospectus.” The Preliminary Prospectus, subject to
completion, dated [•], 2020, that was included in the Registration Statement immediately prior to the Applicable Time is hereinafter called the “Pricing Prospectus.” The final prospectus in the form first
furnished to the Underwriters for use in the Offering is hereinafter called the “Prospectus.” Any reference to the “most recent Preliminary Prospectus” shall be deemed to refer to the latest Preliminary
Prospectus included in the Registration Statement.
“Applicable Time” means [___] a.m./p.m., Eastern time, on the
date of this Agreement.
“Issuer Free Writing Prospectus” means any “issuer free
writing prospectus,” as defined in Rule 433 of the Securities Act Regulations (“Rule 433”), including without limitation any “free writing prospectus” (as defined in Rule 405 of the Securities Act Regulations)
relating to the Public Securities that is (i) required to be filed with the Commission by the Company, (ii) a “road show that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the
Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Public Securities or of the Offering that does not reflect the final terms, in each case in the form filed or required
to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g).
“Issuer General Use Free Writing Prospectus” means any Issuer
Free Writing Prospectus that is intended for general distribution to prospective investors (other than a “bona fide electronic road show,” as defined in Rule 433), as evidenced by its being specified in Schedule
2-B hereto.
“Issuer Limited Use Free Writing Prospectus” means any Issuer
Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.
“Pricing Disclosure Package” means any Issuer General Use Free
Writing Prospectus issued at or prior to the Applicable Time, the Preliminary Prospectus dated [______], 2020 and the information included on Schedule 2-A hereto, all considered together.
2.2 Pursuant to the Exchange Act.
The Company has filed with the Commission a Form 8-A (File Number 000-001-37611) providing for the registration pursuant to Section 12(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
of the Common Shares, which includes the Common Shares underlying the Public Warrants. The Company has also filed with the Commission a Form 8-A (File Number 000-[•]) (the “Form 8-A”) providing for the
registration pursuant to Section 12(b) under the Exchange Act of the Public Securities and Public Warrants. The registration of the Common Shares, the Public Securities, and the Public Warrants under the Exchange Act has been declared effective by
the Commission on or prior to the date hereof. The Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common Shares, the Public Securities and the Public
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Warrants under the Exchange Act, nor has the Company received any notification that the Commission is contemplating
terminating such registration.
2.3 Stock Exchange Listing.
The Series A Preferred Shares, the Warrants and the Common Shares underlying the Public Warrants and Public Shares have been approved for listing on the Nasdaq Capital Market (the “Exchange”), subject to
official notice of issuance, and the Company has taken no action designed to, or likely to have the effect of, delisting the Series A Preferred Shares, the Warrants or the Common Shares underlying the Public Warrants and Public Shares from the Exchange, nor has the Company received any notification that the Exchange is contemplating terminating such listing except as described in the Registration Statement, the
Pricing Disclosure Package and the Prospectus.
2.4 No Stop Orders, etc. Neither
the Commission nor, to the Company’s knowledge, any state regulatory authority has issued any order preventing or suspending the use of the Registration Statement, any Preliminary Prospectus or the Prospectus or has instituted or, to the Company’s
knowledge, threatened to institute, any proceedings with respect to such an order. The Company has complied with each request (if any) from the Commission for additional information.
2.5 Disclosures in Registration
Statement.
2.5.1. Compliance with Securities Act
and 10b-5 Representation.
(i) Each of the Registration
Statement and any post-effective amendment thereto, at the time it became effective, complied in all material respects with the requirements of the Securities Act and the Securities Act Regulations. Each Preliminary Prospectus, including the
prospectus filed as part of the Registration Statement as originally filed or as part of any amendment or supplement thereto, and the Prospectus, at the time each was filed with the Commission, complied in all material respects with the
requirements of the Securities Act and the Securities Act Regulations. Each Preliminary Prospectus delivered to the Underwriters for use in connection with this Offering and the Prospectus was or will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(ii) Neither the Registration
Statement nor any amendment thereto, at its effective time, as of the Applicable Time, at the Closing Date or at any Option Closing Date (if any), contained, contains or will contain an untrue statement of a material fact or omitted, omits or will
omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
(iii) The Pricing Disclosure
Package, as of the Applicable Time, at the Closing Date or at any Option Closing Date (if any), did not, does not and will not include 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; and each Issuer Limited Use Free Writing Prospectus hereto does not conflict with the information contained in the Registration Statement, any Preliminary
Prospectus, the Pricing Prospectus or the Prospectus, and each such Issuer Limited Use Free Writing Prospectus, as supplemented by and taken together with the Pricing Prospectus as of the Applicable Time, did not include an 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; provided, however, that this representation and warranty shall not apply to
statements made or statements omitted in reliance upon and in conformity with written information furnished to the Company with respect to the Underwriters by the Representative expressly for use in the Registration Statement, the Pricing
Prospectus or the Prospectus or any amendment thereof or supplement thereto. The parties acknowledge and agree that such information provided by or on behalf of any Underwriter consists solely of the following disclosure contained in the
“Underwriting” section of the Prospectus: (i) the table showing
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the number of securities to be purchased by each Underwriter and the amount of the underwriting discounts; and (ii) the sections titled “Price Stabilization, Short Positions and Penalty Bids”, “Electronic Distribution”, and “Selling Restrictions” (the “Underwriters’ Information”); and
(iv) Neither the Prospectus nor
any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time of any filing with the Commission pursuant to Rule 424(b), at the Closing Date or at any Option Closing Date, included, includes or will
include an untrue statement of a material fact or omitted, omits or will 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; provided,
however, that this representation and warranty shall not apply to the Underwriters’ Information.
2.5.2. Disclosure of Agreements.
The agreements and documents described in the Registration Statement, the Pricing Disclosure Package and the Prospectus conform in all material respects to the descriptions thereof contained therein and there are no agreements or other documents
required by the Securities Act and the Securities Act Regulations to be described in the Registration Statement, the Pricing Disclosure Package and the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that
have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i) that is referred to in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the
Company and, to the Company’s knowledge, the other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (y)
as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the
equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the Company’s knowledge, any other
party is in default thereunder and, to the Company’s knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best of the Company’s knowledge, performance by the
Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having
jurisdiction over the Company or any of its assets or businesses (each, a “Governmental Entity”), including, without limitation, those relating to environmental laws and regulations.
2.5.3. Prior Securities Transactions.
No securities of the Company have been sold by the Company or by or on behalf of, or for the benefit of, any person or persons controlling, controlled by or under common control with the Company, except as disclosed in the Registration Statement,
the Pricing Disclosure Package and the Preliminary Prospectus.
2.5.4. Regulations. The disclosures
in the Registration Statement, the Pricing Disclosure Package and the Prospectus concerning the effects of federal, state, local and all foreign regulation on the Offering and the Company’s business as currently contemplated are correct in all
material respects and no other such regulations are required to be disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus which are not so disclosed.
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2.6 Changes After Dates in
Registration Statement.
2.6.1. No Material Adverse Change.
Since the respective dates as of which information is given in the Registration Statement, the Pricing Disclosure Package and the Prospectus, except as otherwise specifically stated therein: (i) there has been no material adverse change in the
financial position or results of operations of the Company and its Subsidiaries (as defined below), taken as a whole, nor any change or development that, singularly or in the aggregate, would involve a material adverse change or a prospective
material adverse change, in or affecting the condition (financial or otherwise), results of operations, business, assets or prospects of the Company and its Subsidiaries, taken as a whole (a “Material Adverse Change”);
(ii) there have been no material transactions entered into by the Company, other than as contemplated pursuant to this Agreement; and (iii) no officer or director of the Company has resigned from any position with the Company.
2.6.2. Recent Securities Transactions,
etc. Subsequent to the respective dates as of which information is given in the Registration Statement, the Pricing Disclosure Package and the Prospectus, and except as may otherwise be indicated or contemplated herein or disclosed in the
Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has not: (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money except for any sales completed pursuant to
the Equity Distribution Agreement by and between the Company and Noble Capital Markets dated March 30, 2018, as amended; or (ii) declared or paid any dividend or made any other distribution on or in respect to its capital stock.
2.7 Independent Accountants. To the knowledge of the Company, Ernst & Young (Hellas) Certified Auditors Accountants S.A. (the “Auditor”), whose reports are filed with the Commission as part of the Registration Statement, the Pricing Disclosure Package and the Prospectus, is an independent registered public accounting firm as required by the Securities
Act and the Securities Act Regulations and the Public Company Accounting Oversight Board. The Auditors have not, during the periods covered by the financial statements included in the Registration Statement, the Pricing Disclosure Package and the
Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act.
2.8 No Restrictions. There are
no restrictions on subsequent transfers of the Securities under the Company’s or any Subsidiary’s (as defined below) organizational documents or the laws of the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta.
2.9 Financial Statements; Non-GAAP
Financial Measures. The financial statements, including the notes thereto and supporting schedules included in the Registration Statement, the Pricing Disclosure Package and the Prospectus, fairly present the
financial position and the results of operations of the Company at the dates and for the periods to which they apply; and such financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”), consistently applied throughout the periods involved (provided that unaudited interim financial statements are subject to year-end audit adjustments that are
not expected to be material in the aggregate and do not contain all footnotes required by GAAP); and the supporting schedules included in the Registration Statement present fairly the information required to be stated therein. Except as included
therein, no historical or pro forma financial statements are required to be included in the Registration Statement, the Pricing Disclosure Package or the Prospectus under the Securities Act or the Securities Act Regulations. The “as adjusted” and
“as further adjusted” financial information and the related notes included in the Registration Statement, the Pricing Disclosure Package and the Prospectus have been properly compiled and prepared in accordance with the applicable requirements of
the Securities Act and the Securities Act Regulations and
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present fairly the information shown therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used
therein are appropriate to give effect to the transactions and circumstances referred to therein. All disclosures contained in the Registration Statement, the Pricing Disclosure Package or the Prospectus regarding “non-GAAP financial measures” (as
such term is defined by the rules and regulations of the Commission), if any, comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Securities Act, to the extent applicable. Each of the Registration Statement, the Pricing
Disclosure Package and the Prospectus discloses all material off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships of the Company with unconsolidated entities or other persons that may
have a material current or future effect on the Company’s financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital resources, or significant components of revenues or expenses. Except as
disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, (a) neither the Company nor any of its direct and indirect subsidiaries, including each entity disclosed or described in the Registration Statement, the
Pricing Disclosure Package and the Prospectus as being a subsidiary of the Company (each, a “Subsidiary” and, collectively, the “Subsidiaries”), has incurred any material
liabilities or obligations, direct or contingent, or entered into any material transactions other than in the ordinary course of business, (b) the Company has not declared or paid any dividends or made any distribution of any kind with respect to its
capital stock, (c) there has not been any change in the capital stock of the Company or any of its Subsidiaries, or, other than in the course of business, any grants under any stock compensation plan, and (d) there has not been any Material Adverse
Change in the Company’s long-term or short-term debt.
2.10 Good Standing of Company.
The Company is validly existing as a corporation in good standing under the laws of the Republic of The ▇▇▇▇▇▇▇▇ Islands and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the
Registration Statement, the Pricing Disclosure Package and the Prospectus and to enter into and perform its respective obligations under this Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing is not resulting or
would not reasonably be expected to result in a Material Adverse Change.
2.11 Good Standing of Subsidiaries.
The subsidiaries listed on Schedule 2.11 hereto (the “Subsidiaries”) are the only subsidiaries which are currently material to the business and operations of the Company, and each such Subsidiary has been
duly organized and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation or formation (either the Republic of the ▇▇▇▇▇▇▇▇ Islands or Malta), has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus and is duly qualified as a foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing is not resulting or would not reasonably be
expected to result in a Material Adverse Change. All of the issued and outstanding capital stock of each Subsidiary has been duly authorized and validly issued and is fully paid and non-assessable and is owned by the Company, directly or through
one or more wholly-owned Subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim except for those arising under any credit facility or loan agreement (“Credit Facilities”)
to which the Company or any of its Subsidiaries is a party as disclosed in or contemplated in the Registration Statement, Pricing Disclosure Package and the Prospectus or any related Security Agreement or Pledge Agreement; none of the outstanding
shares of capital stock of any Subsidiary was issued in violation of the preemptive or similar rights of any security holder of such Subsidiary.
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2.12 Capitalization. The Company
has authorized capital stock as set forth in the sections of the Prospectus entitled “Capitalization” and “Description of our Capital Stock” (and any similar sections or information, if any, contained in any Issuer Free Writing Prospectus), and, as
of the Applicable Time and any as of each Date of Delivery (if any), as the case may be, the Company shall have an authorized capital stock as set forth in the sections of the Registration Statement, the Pricing Disclosure Package and the
Prospectus entitled “Capitalization” and “Description of our Capital Stock” (and any similar sections or information, if any, contained in any Issuer Free Writing Prospectus), the Pricing Disclosure Package and the Prospectus. All of the shares of
issued and outstanding capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable; none of the outstanding shares of capital stock of the Company was issued in violation of the preemptive or
other similar rights of any security holder of the Company. The description of the Series A Preferred Shares and Warrants in the Registration Statement, the Pricing Disclosure Package and the Prospectus is complete and
accurate in all material respects.
2.13 Valid Issuance of Securities,
etc.
2.13.1. Outstanding Securities. All
issued and outstanding securities of the Company issued prior to the transactions contemplated by this Agreement have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights of rescission
with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities were issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual
rights granted by the Company. The authorized Series A Preferred Shares, the Warrants and the Common Shares and the Underwriter’s Securities conform in all material respects to all statements relating thereto contained in the Registration
Statement, the Pricing Disclosure Package and the Prospectus. The offers and sales of the Series A Preferred Shares, the Warrants and the Common Shares and the Underwriter’s Securities were at all relevant times either registered under the
Securities Act and the applicable state securities or “blue sky” laws or, based in part on the representations and warranties of the purchasers of such Shares, exempt from such registration requirements.
2.13.2. Securities Sold Pursuant to this
Agreement. The Public Securities and Underwriter’s Securities have been duly authorized for issuance and sale and, when issued and paid for in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable;
the holders thereof are not and will not be subject to personal liability by reason of being such holders; the Public Securities and Underwriter’s Securities are not and will not be subject to the preemptive rights of any holders of any security of
the Company or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Public Securities and Underwriter’s Securities has been duly and validly taken. The
Public Securities and Underwriter’s Securities conform in all material respects to all statements with respect thereto contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus. All corporate action required to be
taken for the authorization, issuance and sale of the Underwriter’s Warrant Agreements has been duly and validly taken; the Preferred Shares and warrants issuable upon exercise of the Underwriter's Warrants (and the Common Shares issuable upon
exercise of the Underwriter’s Firm Warrant for Common Share Warrants) and the Common Shares issuable upon conversion of the Preferred Shares issuable upon exercise of the Underwriter's Firm Warrants for Preferred Shares have been duly authorized
and reserved for issuance by all necessary corporate action on the part of the Company and when paid for and issued in accordance with the Underwriter’s Warrants and the Underwriter’s Warrant Agreements, such underlying Common Shares will be
validly issued, fully paid and non-assessable; the holders thereof are not and will not be subject to personal liability by reason of being such holders; and such underlying Common Shares are not and will not be subject to the preemptive rights of
any holders of any security of the Company or similar contractual rights granted by the Company.
2.14 Validity
and Binding Effect of Agreements. This Agreement and the Underwriter’s Warrant Agreements have been duly and validly authorized by the Company, and, when
executed and delivered, will constitute, the valid and binding agreements of the Company, enforceable against the
9
Company in accordance with their respective terms, except: (i) as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws; and (iii) that the remedy of specific
performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.
2.15 Agreements. Except as
disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, neither the Company nor any Subsidiaries has terminated any of the contracts or agreements filed as an exhibit to the Registration Statement or any document
listed as an exhibit to the Registration Statement and incorporated by reference therein, and no such termination has been threatened by the Company or any of its Subsidiaries or, to the Company’s knowledge, any other party to any such contract or
agreement. Any descriptions of the terms of any of the foregoing contracts and agreements that are contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus are accurate and fair in all material respects.
2.16 Absence of Defaults and Conflicts.
Neither the Company nor any Subsidiary is in violation of its charter, bylaws or other organizational documents or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement (including any Credit Facility), note, lease or other agreement or instrument to which the Company or any Subsidiary is a party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any Subsidiary, is subject (collectively, “Agreements and Instruments”) except for such violations or defaults, singly or in the aggregate, that are not resulting or would
not reasonably be expected to result in a Material Adverse Change; and the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein and in the Registration Statement, the Pricing Disclosure
Package and the Prospectus (including the issuance and sale of the Public Securities by the Company) and compliance by the Company with its obligations hereunder have been duly authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both: (A) result in any violation of the provisions of the Company’s articles of incorporation (the “Charter”), the Company’s Certificate of Designation 7.75% Series A Cumulative Convertible Preferred Shares (the “Certificate of Designation”) or the
Company’s bylaws (the “Bylaws”) or any other organization document of the Company or any Subsidiary, or (B) conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or
result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any Subsidiary pursuant to, the Agreements and Instruments (except for such conflicts, breaches, defaults, Repayment Events,
liens, charges or encumbrances that are not, singly or in the aggregate, resulting or would not reasonably be expected, singly or in the aggregate, to result in a Material Adverse Change), or result in any violation of any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government, government instrumentality, self-regulatory organization or other non-governmental regulatory authority (including without limitation, the rules and regulations of the NASDAQ
Stock Market (“Nasdaq”)) or court, domestic or foreign, having jurisdiction over the Company or any Subsidiary or any of their assets, properties or operations, except for such violations that are not
resulting or would not reasonably be expected to result in a Material Adverse Change. As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all of such indebtedness by the Company or any Subsidiary.
2.17 Absence of Labor Dispute. No
labor dispute with the employees of the Company, any of the Company’s affiliates controlled by it or any Subsidiary exists or, to the knowledge of the Company, is imminent, which currently is resulting in or would reasonably be expected to result
in a Material Adverse
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Change, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of its or any Subsidiary’s
principal suppliers, manufacturers, customers or contractors, which is resulting in or would reasonably be expected to result in a Material Adverse Change.
2.18 Absence of Proceedings.
There is no action, suit, proceeding, inquiry or investigation before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Company or any
Subsidiary, which is required to be disclosed in the Registration Statement, the Pricing Disclosure Package or the Prospectus that is not so disclosed, or which is resulting or would reasonably be expected to result in a Material Adverse Change, or
which is materially and adversely affecting or would reasonably be expected to materially and adversely affect the properties or assets thereof or the consummation of the transactions contemplated in this Agreement or the performance by the Company
of its obligations hereunder; and the aggregate of all pending legal or governmental proceedings to which the Company or any Subsidiary is a party or of which any of their respective property or assets is the subject which are not described in the
Registration Statement, the Pricing Disclosure Package and the Prospectus, including ordinary routine litigation incidental to the business, are not resulting or would not reasonably be expected to result in a Material Adverse Change.
2.19 Accuracy of Exhibits. There
are no contracts, instruments or documents which are required to be described in the Registration Statement, the Pricing Disclosure Package or the Prospectus or to be filed as exhibits thereto which have not been so described and filed.
2.20 Possession of Intellectual
Property. The Company and the Subsidiaries own or possess, or can acquire on reasonable terms, adequate patents, patent rights, licenses, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the
business now operated by them in any material respect, and none of the Company or any Subsidiary has received any notice or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any Intellectual Property invalid or inadequate to protect the interest of the Company or any Subsidiary therein, and which infringement or conflict (in the case of any unfavorable
decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, is currently resulting or would reasonably be expected to result in a Material Adverse Change.
2.21 Absence of Further Requirements.
No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court, governmental authority or agency or regulatory authority or self-regulatory organization or other non-governmental regulatory
authority (including without limitation, the rules and regulations of Nasdaq) or approval of the Company’s shareholders, is necessary or required for the performance by the Company of its obligations hereunder, in connection with the offering,
issuance and sale of the Public Securities hereunder or the consummation of the transactions contemplated by this Agreement, except (i) such as have been already obtained or as may be required under the Public Securities Act or the Public
Securities Act Regulations or state securities laws and (ii) under the by-laws and rules of the Financial Industry Regulatory Authority (“FINRA”).
2.22 Absence of Manipulation.
Neither the Company nor, to the Company’s knowledge, any officer, director, employee or affiliate of the Company has taken any action which is designed to or which has constituted or which would be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the sale or resale of the Public Securities.
2.23 Possession of Licenses and
Permits. The Company and each Subsidiary possess such permits, licenses, certificates, approvals, financial assurances, consents and other authorizations
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(collectively, “Governmental Licenses”) issued by the appropriate international, national, state
or local regulatory agencies or bodies (collectively, “Governmental Authorities”) necessary to conduct the business now operated by them, except where the failure to so possess is not, singly or in the
aggregate, resulting or would not reasonably be expected, singly or in the aggregate, to result in a Material Adverse Change; the Company and each Subsidiary are in compliance with the terms and conditions of all such Governmental Licenses, except
where the failure to so comply is not, singly or in the aggregate, resulting or would not reasonably be expected, singly or in the aggregate, to result in a Material Adverse Change; all of the Governmental Licenses are valid and in full force and
effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect is not, singly or in the aggregate, resulting or would not reasonably be expected, singly or in the
aggregate, to result in a Material Adverse Change; and none of the Company or any of the Subsidiaries has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, result in or would reasonably be expected to result in a Material Adverse Change.
2.24 Title to Real or Leased Property.
The Company and each Subsidiary has good and marketable title to all real property owned by them, free and clear of all mortgages, pledges, liens, security interests, claims, restrictions or encumbrances of any kind except such as: (A) are
described in the Registration Statement, Pricing Disclosure Package and Prospectus or (B) would not, singly or in the aggregate, result in a Material Adverse Change; and all of the leases and subleases material to the business of the Company and
its Subsidiaries, considered as one enterprise, and under which the Company or any of its Subsidiaries holds properties described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, are in full force and effect, and
neither the Company nor any Subsidiary has any notice of any material claim of any sort that has been asserted by anyone adverse to the rights of the Company or any Subsidiary under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the Company or such Subsidiary to the continued possession of the leased or subleased premises under any such lease or sublease in any material respect.
2.25 Vessels. Each of the
vessels described in the Registration Statement, the Pricing Disclosure Package and the Prospectus as being owned by the Company or any Subsidiary as described therein or listed on Schedule 2.25 hereto (“Owned
Vessels”) has been duly and validly registered in the name of a Subsidiary under the laws and regulations and flag of the nation of its registration; no other action is necessary to establish and perfect such entity’s title to and interest
in any of the Owned Vessels as against any third party; and each Owned Vessel is owned directly by the Company or such Subsidiary free and clear of all liens, claims, security interests or other encumbrances, except such as are described in or
contemplated by the Registration Statement, the Pricing Disclosure Package and the Prospectus. Each such Subsidiary has good title to the applicable Owned Vessel, free and clear of all mortgages, pledges, liens, security interests and claims and
all defects of the title of record except for maritime liens incurred in the ordinary course and those liens arising under Credit Facilities, each as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
2.26 Owned Vessels. Each of the
Owned Vessels is in good standing with respect to the payment of past and current taxes, fees and other amounts payable under the laws of the jurisdiction in which it is registered, except for any failure which would not result in a Material
Adverse Change.
2.27 Maritime Guidelines. Each
of the Owned Vessels is operated in compliance with the rules, codes of practice, conventions, protocols, guidelines or similar requirements or restrictions imposed, published or promulgated by any governmental authority, with moral jurisdiction
over, or classification society or insurer applicable to the respective Owned Vessel (collectively, “Maritime Guidelines”) and all applicable international, national, state and local conventions, laws,
regulations, orders, governmental licenses and other requirements (including, without limitation, all Environmental Laws), in each case as in
12
effect on the date hereof, except where such failure to be in compliance is not resulting or would not reasonably be expected to result
in a Material Adverse Change. The Company and each applicable Subsidiary are qualified to own or lease, as the case may be, and operate such Owned Vessels under all applicable international, national, state and local conventions, laws, regulations,
orders, governmental licenses and other requirements (including, without limitation, all Environmental Laws) and Maritime Guidelines, including the laws, regulations and orders of each such vessel’s flag state, in each case as in effect on the date
hereof, except where such failure to be so qualified is not resulting or would not reasonably be expect to result in a Material Adverse Change.
2.28 Vessel Classification. Each
of the Owned Vessels is classed by a classification society which is a full member of the International Association of Classification Societies and such Owned Vessels are in class with valid class and trading certificates, without overdue
recommendations, in each case based on the classification and certification requirements in effect on the date hereof.
2.29 Vessel Memorandum of Agreement;
Ship Building Contracts. Neither the Company nor any Subsidiary is a party to any agreement (memorandum of agreement or otherwise) pursuant to which it has contracted to build any shipping vessels.
2.30 Investment Company Act. The
Company is not required, and upon the issuance and sale of the Public Securities as contemplated by this Agreement and the application of the net proceeds therefrom as described in the Registration Statement, the Pricing Disclosure Package and the
Prospectus will not be required, to register as an “investment company” under the Investment Company Act of 1940, as amended (the “1940 Act”).
2.31 Compliance with Environmental
Laws. Except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, (A) neither the Company nor any of its Subsidiaries is in violation of any applicable international, national, state or local
convention, law, regulation, order, Governmental License or other requirement relating to pollution or protection of human health or safety (as they relate to exposure to Materials of Environmental Concern (as defined below)) or protection of the
environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or protection of natural resources, including without limitation, conventions, laws or regulations relating to emissions,
discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum and petroleum products (collectively, “Materials of Environmental Concern”),
or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (collectively, “Environmental Laws”), nor has
the Company or any Subsidiary received any written communication, whether from a Governmental Authority, citizens group, employee or otherwise, that alleges that the Company or any such Subsidiary is in violation of any Environmental Law or
Governmental License required pursuant to Environmental Law; except, in each case, as does not or would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Change; (B) there is no claim, action or cause of
action filed with a court or Governmental Authority and no investigation, or other action with respect to which the Company or any Subsidiary has received written notice alleging potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damages, property damages, personal injuries, attorneys’ fees or penalties arising out of, based on or resulting from the presence, or release into the environment, of any Material of Environmental
Concern at any location owned, leased or operated by the Company or any Subsidiary, now or in the past, or from any vessel owned, leased or operated by the Company or any Subsidiary, now or in the past (collectively, “Environmental Claim”), pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary or any person or entity whose liability for any Environmental Claim the Company or any Subsidiary has retained or
assumed either contractually or by operation of law, except as does not or would not reasonably be expected, individually or in the aggregate, to have a Material Adverse
13
Change; (C) to the knowledge of the Company, there are no past or present actions, activities, circumstances, conditions, events or
incidents, including, without limitation, the release, emission, discharge, presence or disposal of any Material of Environmental Concern, that reasonably would be expected to result in a violation of any Environmental Law, require expenditures to be
incurred pursuant to Environmental Law, or form the basis of an Environmental Claim against the Company, any Subsidiary or against any person or entity whose liability for any Environmental Claim the Company or any Subsidiary has retained or assumed
either contractually or by operation of law, except as does not or would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Change (for the avoidance of doubt, the operation of vessels in the ordinary course of
business shall not be deemed, by itself, an action, activity, circumstance or condition set forth in this clause (C)); and (D) neither the Company nor any Subsidiary is subject to any pending proceeding under Environmental Law to which a Governmental
Authority is a party and which the Company reasonably believes is likely to result in monetary sanctions of US$600,000 or more.
2.32 Effect of Environmental Laws.
The Company has reasonably concluded that associated costs and liabilities arising under Environmental Laws and resulting from the business, operations or properties of the Company or any Subsidiary does not or would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Change, except as set forth in or contemplated in the Pricing Disclosure Package, the Registration Statement and the Prospectus.
2.33 Registration Rights. Except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus, no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities
of the Company have the right to require the Company to register any such securities of the Company under the Securities Act or to include any such securities in a registration statement to be filed by the Company.
2.34 Accounting Controls. The
Company and each of its Subsidiaries maintain effective internal control over financial reporting (as defined under Rule 13a-15 and 15d-15 under the rules and regulations of the Commission thereunder (the “Exchange
Act Regulations”)) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s general or specific authorization; (B) transactions are recorded
as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance with management’s general or specific authorization; and (D) the
recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Since the end of the Company’s most recent audited fiscal year, there has been (I) no
material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (II) no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial reporting. The Company and its consolidated subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15 and Rule 15d-15 under the
Exchange Act Regulations) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods
specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, appropriate, to allow timely
decisions regarding disclosure.
2.35 Compliance with the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act. There is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any provision of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002 and the rules and regulations
14
promulgated thereunder or implementing the provisions thereof (the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”) that are
in effect and which the Company is required to comply with.
2.36 Compliance. The Company is subject to and in compliance in all material respects with the reporting requirements of Section 13 or Section 15(d) of the 1934 Act. The Common Shares are registered pursuant to Section 12(b) of the 1934
Act and are listed on The Nasdaq Capital Market, and the Company has taken no action designed to, or reasonably likely to have the effect of, terminating the registration of the Common Shares under the 1934 Act or delisting the Common Shares from
The Nasdaq Capital Market nor has the Company received any notification that the Commission or FINRA is contemplating terminating such registration or listing, except as described in the Pricing Disclosure Package.
2.37 Incorporated Documents. The documents incorporated by reference in the Registration Statement, the Prospectus and the Pricing Disclosure Package, when they were filed with the Commission
conformed in all material respects to the requirements of the Exchange Act, and none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
2.38 Taxes. No capital gains,
income, withholding or other taxes are payable by or on behalf of the Underwriters to the Republic of Greece or the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta (assuming that none of the Underwriters are citizens or residents of the Republic of
Greece or the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta or are carrying on business or conducting transactions in the Republic of Greece or the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta), or to any political subdivision or taxing authority thereof
or therein in connection with the issuance, sale and delivery by the Company of the Public Securities to or for the respective accounts of the Underwriters.
2.39 Payment of Taxes. All United
States federal income tax returns of the Company and its Subsidiaries required by law to be filed have been filed, except insofar as the failure to file such returns would not result in a Material Adverse Change, and all taxes shown by such returns
or otherwise assessed, which are due and payable, have been paid, except assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been provided. Any applicable United States federal income tax
returns of the Company through the fiscal year ended December 31, 2016 have been filed and no assessment in connection therewith has been made against the Company. The Company and its Subsidiaries have filed all other tax returns that are required
to have been filed by them pursuant to applicable foreign, state, local or other law except insofar as the failure to file such returns would not result in a Material Adverse Change and has paid all taxes due pursuant to such returns or pursuant to
any assessment received by the Company and its Subsidiaries, except for such taxes, if any, as are being contested in good faith and as to which adequate reserves have been provided. The charges, accruals and reserves on the books of the Company in
respect of any income and corporation tax liability for any years not finally determined are adequate to meet any assessments or re-assessments for additional income tax for any years not finally determined, except to the extent of any inadequacy
that would not result in a Material Adverse Change.
2.40 Transfer Taxes. There are no
documentary, stamp or other issuance or transfer taxes or duties or similar fees or charges under U.S. federal law or the laws of any U.S. state or the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta (assuming that none of the Underwriters are citizens
or residents of the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta are carrying on business or conducting transactions in the Republic of The ▇▇▇▇▇▇▇▇ Islands or Malta), or any political subdivision of any thereof, required to be paid in connection with
the execution and delivery of this Agreement or the issuance, sale and delivery by the Company of the Public Securities to or for the respective accounts of the Underwriters.
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2.41 Insurance. The Company and
its Subsidiaries carry or are entitled to the benefits of insurance, with financially sound and reputable insurers (which term shall include protection and indemnity associations or clubs), in such amounts and covering such risks as the Company
reasonably considers adequate for the conduct of its business and the value of its properties and as is generally maintained by companies of a similar size engaged in the same or similar business, and all such insurance is in full force and effect.
There are no material claims by or on behalf of the Company or any Subsidiary under any such policy or instrument as to which any insurance company is denying liability or defending under a reservation of rights clause and neither the Company nor
any of the Subsidiaries is currently required to make any payment, or is aware of any facts which would require the Company or any Subsidiary to make any payment, in respect of a call by, or a contribution to, any insurance club, except for any
payment or claims which do not or would not reasonably be expected to, in the aggregate, result in a Material Adverse Change. The Company has no reason to believe that it or any Subsidiary will not be able (A) to renew its existing insurance
coverage as and when such policies expire or (B) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not reasonably be expected to result in a
Material Adverse Change.
2.42 Industry and Market-Related Data.
Any industry and market-related data included in the Registration Statement, the Pricing Disclosure Package and the Prospectus are provided by ▇▇▇▇▇▇ Shipping Consultants Ltd. or based on or derived from sources that the Company believes to
be reliable and accurate and, to the extent required, the Company has obtained the written consent to the use of such data from such sources.
2.43 Pending Proceedings and
Examinations. The Registration Statement is not the subject of a pending proceeding or examination under Section 8(d) or 8(e) of the Securities Act, and the Company is not the subject of a pending proceeding under Section 8A of the Securities
Act in connection with the offering of the Public Securities.
2.44 Foreign Corrupt Practices.
Neither the Company nor any of its Subsidiaries nor any director or officer, nor, to the Company’s best knowledge, any affiliate, employee, agent or representative of the Company or of any of its Subsidiaries or affiliates, has taken or will take
any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any “government official” (including any officer
or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or
candidate for political office) to influence official action or secure an improper advantage; and the Company and its Subsidiaries, and, to the Company’s best knowledge, the Company’s affiliates have conducted their businesses in compliance with
applicable anti-corruption laws and have instituted and maintain and will continue to maintain policies and procedures designed to promote and achieve compliance with such laws and with the representation and warranty contained herein.
2.45 Money Laundering Laws. The
operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and its Subsidiaries
conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money
Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its
16
Subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.
2.46 OFAC.
2.46.1 Neither the Company nor any of its
Subsidiaries, nor any director or executive officer thereof, nor, to the Company’s best knowledge, any other officer, employee, agent, affiliate or representative of the Company or any of its Subsidiaries, is an individual or entity (“Person”) that is, or is owned or controlled by a Person that is (1) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security Council, the European Union or Her Majesty’s Treasury (collectively, “Sanctions”), nor (2) located, organized or resident in the
Balkans, Belarus, Burma, Cote D’Ivoire, Cuba, Democratic Republic of Congo, Iran, Iraq, North Korea, Sudan, Syria or Zimbabwe.
2.46.2 The Company will not, directly or
indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other Person to fund or facilitate any activities or business of any Person in any country or
territory that, at the time of such funding or facilitation, is the Company’s knowledge the subject of Sanctions; or
2.46.3 Since their inception, the Company
and its Subsidiaries have not knowingly engaged in, and are not now knowingly engaged in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of
Sanctions.
2.47 Commissions and Fees. Except
as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no contracts, agreements or understandings between the Company and any person (including but not limited to the contracts, agreements or
understandings between the Company and Noble Capital Markets) that would give rise to a valid claim against the Company or any Underwriter for a brokerage commission, finder’s fee or other like payment in connection with the transactions
contemplated by this Agreement, the Registration Statement, the Pricing Disclosure Package and the Prospectus or, to the Company’s best knowledge, any arrangements, agreements, understandings, payments or issuance with respect to the Company or any
of its officers, directors, shareholders, partners, employees, Subsidiaries or affiliates that may affect the Underwriters’ compensation as determined by FINRA.
2.48 No Association with FINRA.
Neither the Company nor any of its officers, directors, employees or affiliates directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, or is a person associated with (within the
meaning of Article I (dd) of the bylaws of the FINRA), any member firm of the FINRA.
2.49 No Outstanding Loans or Other
Indebtedness. There are no outstanding loans, advances (except normal advances for business expenses in the ordinary course of business) or guarantees or indebtedness by the Company to or for the benefit of any of the executive officers or
directors of the Company or any of the family members of any of them.
2.50 Immunity from Jurisdiction.
Neither the Company nor any Subsidiary or any of their respective properties or assets has any immunity from the jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid
of execution or otherwise) under the laws of the United States, the Republic of The ▇▇▇▇▇▇▇▇ Islands or Greece or any political subdivisions thereof.
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2.51 Foreign Private Issuer Status.
The Company is a “foreign private issuer” as defined in Rule 405 of the Securities Act.
2.52 PFIC Status. The Company did
not qualify as a “passive foreign investment company” within the meaning of Section 1297 of the United States Internal Revenue Code of 1986, as amended, for its most recently completed taxable year, if any.
2.53 Dividends and Distributions.
Except in accordance with ▇▇▇▇▇▇▇▇ Islands law or otherwise as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company is not prohibited, directly or indirectly, from paying any dividends, from making
any other distribution, from repaying any loans or advances or from transferring any of its property or assets. All dividends and other distributions declared and payable on the shares of capital stock of the Company may, under the current laws and
regulations of the Republic of The ▇▇▇▇▇▇▇▇ Islands be paid in United States dollars and may be freely transferred out of the Republic of The ▇▇▇▇▇▇▇▇ Islands and all such dividends and other distributions will not be subject to withholding or
other taxes under the laws and regulations of the Republic of The ▇▇▇▇▇▇▇▇ Islands (so long as not paid to a citizen or resident of the Republic of The ▇▇▇▇▇▇▇▇ Islands) and are otherwise free and clear of any other tax, withholding or deduction
and without the necessity of obtaining any consents, approvals, authorizations, orders, licenses, registrations, clearances and qualifications of or with any court or governmental agency or body or any stock exchange authority in the Republic of
The ▇▇▇▇▇▇▇▇ Islands.
2.54 No Limits on Distributions.
Except as disclosed in or contemplated by the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no limitations on the ability of the Company to make distributions in respect of or to redeem the Public Securities.
Except as disclosed in or contemplated by the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no encumbrances or restrictions on the ability of any Subsidiary: (A) to pay dividends or make other distributions on
such Subsidiary’s capital stock or to pay any indebtedness to the Company and any such dividends and other distributions, under the current laws and regulations of the jurisdictions where such Subsidiaries are organized, may be freely transferred
out of such jurisdictions and all such dividends and other distributions will not be subject to withholding or other taxes under the laws and regulations of such jurisdictions, (B) to make loans or advances or pay any indebtedness to the Company or
(C) to transfer any of its property or assets to the Company.
2.55 Forward-Looking Statements.
Each “forward-looking statement” (within the meaning of Section 27A of the Securities Act or Section 21E of the Exchange Act) contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus has been made or reaffirmed
with a reasonable basis and has been disclosed in good faith.
2.56 Submission to Jurisdiction.
The Company has the power to submit, and pursuant to Section 16 of this Agreement has legally, validly, effectively and irrevocably submitted, to the jurisdiction of any federal or state court in the State of New York, County of New York, and has
the power to designate, appoint and empower, and pursuant to Section 16 of this Agreement has legally, validly and effectively designated, appointed and empowered, an agent for service of process in any suit or proceeding based on or arising under
this Agreement in any federal or state court in the State of New York.
2.57 Ineligible
Issuer. At the time of filing the Registration Statement and any post-effective amendment thereto, at the time of effectiveness of the Registration Statement and any amendment thereto, at the earliest
time thereafter that the Company or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the Securities Act Regulations) of the Public Securities and at the date hereof, the Company was not and is not an
“ineligible issuer,” as defined in Rule 405, without
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taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an
ineligible issuer.
2.58 XBRL. The interactive data
in eXtensible Business Reporting Language included in the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.
2.59 Electronic Road Show. The Company has made available a Bona Fide Electronic Road Show in compliance with Rule 433(d)(8)(ii) of the Securities Act Regulations such that no filing of any
“road show” (as defined in Rule 433(h) of the Securities Act Regulations) is required in connection with the Offering.
2.60 Testing-the-Waters
Communications. The Company has not (i) alone engaged in any Testing-the-Waters Communications, other than Testing-the-Waters Communications with the written consent of the Representative and with
entities that are qualified institutional buyers within the meaning of Rule 144A under the Securities Act or institutions that are accredited investors within the meaning of Rule 501 under the Securities Act and (ii) authorized anyone other than
the Representative to engage in Testing-the-Waters Communications. The Company confirms that the Representative has been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The Company has not distributed any Written
Testing-the-Waters Communications other than those listed on Schedule 2-C hereto. “Written Testing-the-Waters Communication” means any Testing-the-Waters
Communication that is a written communication within the meaning of Rule 405 under the Securities Act.
2.61 Related Party Transactions. There are no business relationships or related party transactions involving the Company or any other person required to be described in the Registration Statement, the
Pricing Disclosure Package and the Prospectus that have not been described as required.
2.62 Lock-Up Agreements. Schedule 3 hereto contains a complete and accurate list of the Company’s officers,
directors and each owner of at least 5% of the Company’s outstanding Common Shares (or securities convertible or exercisable into Common Shares) (collectively, the “Lock-Up Parties”). The Company has caused each of the Lock-Up Parties to deliver to the Representative an executed Lock-Up Agreement, in the form attached hereto as Exhibit B (the “Lock-Up Agreement”), prior to the execution of this Agreement.
2.63 Use
of Proceeds. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member or its affiliates, except as
specifically authorized herein.
2.64 Margin Securities. The Company owns no “margin securities” as that term is defined in Regulation U of the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”), and none of the proceeds of Offering will be used, directly or indirectly, for the purpose of purchasing or carrying any margin security, for the purpose of
reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the Common Shares to be considered a “purpose credit” within the meanings of Regulation
T, U or X of the Federal Reserve Board.
2.65 Emerging Growth Company. The
Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act (an “Emerging Growth Company”).
2.66 Officer’s Certificates. Any
certificate signed by any officer of the Company or any of its Subsidiaries delivered to the Representative or to counsel for the Underwriters shall be deemed a
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representation and warranty by the Company or such Subsidiary, as the case may be, to each Underwriter as to the matters covered thereby.
3. Company covenants and agrees as follows:
3.1 Amendments to Registration
Statement. The Company shall deliver to the Representative, prior to filing, any amendment or supplement to the Registration Statement, Preliminary Prospectus, Disclosure Package or Prospectus proposed to be filed after the Effective Date and
not file any such amendment or supplement to which the Representative shall reasonably object in writing.
3.2 Federal Securities Laws.
3.2.1 Compliance. The Company, subject to Section 3.2.2, shall comply with the requirements of Rule 424(b) and Rule 430A
of the Securities Act Regulations, and will notify the Representative promptly, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement or any amendment or supplement to any Preliminary Prospectus,
the Pricing Disclosure Package or the Prospectus shall have been filed and when any post-effective amendment to the Registration Statement shall become effective; (ii) of the receipt of any comments from the Commission; (iii) of any request by
the Commission for any amendment to the Registration Statement or any amendment or supplement to any Preliminary Prospectus, the Pricing Disclosure Package or the Prospectus or for additional information; (iv) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any Preliminary Prospectus, the Pricing Disclosure Package or the Prospectus, or of the
suspension of the qualification of the Public Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(d) or 8(e) of the
Securities Act concerning the Registration Statement; and (v) if the Company becomes the subject of a proceeding under Section 8A of the Securities Act in connection with the Offering of the Public Securities. The Company shall effect all filings
required under Rule 424(b) of the Securities Act Regulations, in the manner and within the time period required by Rule 424(b) (without reliance on Rule 424(b)(8)), and shall take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus. The Company shall use its best efforts to prevent the issuance of any
stop order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.
3.2.2 Continued Compliance. The
Company shall comply with the Securities Act, the Securities Act Regulations, the Exchange Act and the Exchange Act Regulations so as to permit the completion of the distribution of the Public Securities as contemplated in this Agreement and in the
Registration Statement, the Pricing Disclosure Package and the Prospectus. If at any time when a prospectus relating to the Public Securities is (or, but for the exception afforded by Rule 172 of the Securities Act Regulations (“Rule 172”), would be) required by the Securities Act to be delivered in connection with sales of the Public Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of Representative Counsel or counsel for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; (ii) amend or supplement the Pricing Disclosure Package or the Prospectus in order that the Pricing Disclosure Package or the
Prospectus, as the case may be, will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it
is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the Pricing Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the Securities Act or the Securities
Act Regulations, the
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Company will promptly (A) give the Representative notice of such event; (B) prepare any amendment or supplement as may be necessary to
correct such statement or omission or to make the Registration Statement, the Pricing Disclosure Package or the Prospectus comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish the Representative
with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; provided, however, that the Company shall not file
or use any such amendment or supplement to which the Representative or Representative Counsel shall reasonably object. The Company will furnish to the Underwriters such number of copies of such amendment or supplement as the Underwriters may
reasonably request. The Company has given the Representative notice of any filings made pursuant to the Exchange Act or the Exchange Act Regulations within 48 hours prior to the Applicable Time. The Company shall give the Representative notice of its
intention to make any such filing from the Applicable Time until the later of the Closing Date and the exercise in full or expiration of the Over-allotment Option specified in Section 1.2 hereof and will furnish the Representative with copies of the
related document(s) a reasonable amount of time prior to such proposed filing, as the case may be, and will not file or use any such document to which the Representative or Representative Counsel shall reasonably object.
3.2.3 Exchange Act Registration. For a period of three (3) years after the date of this Agreement, the Company shall use its best efforts to maintain the registration of the Series A Preferred Shares, Warrants and Common Shares under the Exchange Act. The
Company shall not deregister the Series A Preferred Shares, Warrants and Common Shares under the Exchange Act without the prior written consent of the Representative.
3.2.4. Free Writing Prospectuses.
The Company agrees that, unless it obtains the prior written consent of the Representative, it shall not make any offer relating to the Public Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a
“free writing prospectus,” or a portion thereof, required to be filed by the Company with the Commission or retained by the Company under Rule 433; provided that the Representative shall be deemed to have consented to each Issuer General Use Free
Writing Prospectus hereto and any “road show that is a written communication” within the meaning of Rule 433(d)(8)(i) that has been reviewed by the Representative. The Company represents that it has treated or agrees that it will treat each such
free writing prospectus consented to, or deemed consented to, by the Underwriters as an “issuer free writing prospectus,” as defined in Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect
thereto, including timely filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such
Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Underwriters and will promptly amend or supplement, at its own expense, such Issuer
Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.
3.2.5. Testing-the-Waters
Communications. If at any time following the distribution of any Written Testing-the-Waters Communication there occurred or occurs an event or development as a result of which such Written Testing-the-Waters Communication included or would
include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company
shall promptly notify the Representative and shall promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.
3.3 Delivery to the Underwriters of
Registration Statements. The Company has delivered or made available or shall deliver or make available to the Representative and counsel for the Representative,
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without charge, signed copies of the Registration Statement as originally filed and each amendment thereto (including exhibits filed
therewith) and signed copies of all consents and certificates of experts, and will also deliver to the Underwriters, without charge, a conformed copy of the Registration Statement as originally filed and each amendment thereto (without exhibits) for
each of the Underwriters, provided, however, that the Company shall not be required to furnish any document to the
Representative and counsel for the Representative to the extent such document is available on ▇▇▇▇▇. The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
3.4 Delivery to the Underwriters of
Prospectuses. The Company has delivered or made available or will deliver or make available to each Underwriter, without charge, as many copies of each Preliminary Prospectus as such Underwriter reasonably requested, and the Company hereby
consents to the use of such copies for purposes permitted by the Securities Act, provided, however, that the Company shall
not be required to furnish any document to any Underwriter to the extent such document is available on ▇▇▇▇▇. The Company will furnish to each Underwriter, without charge, during the period when a prospectus relating to the Public Securities is
(or, but for the exception afforded by Rule 172, would be) required to be delivered under the Securities Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably request, provided, however, that the Company shall not be required to furnish any document to any Underwriter to the extent such
document is available on ▇▇▇▇▇. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
3.5 Effectiveness and Events
Requiring Notice to the Representative. The Company shall use its best efforts to cause the Registration Statement to remain effective with a current prospectus for at least nine (9) months after the Applicable Time, and shall notify the
Representative immediately and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of
any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Public Securities for offering or sale in any jurisdiction or of the initiation, or the
threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any
additional information from the Commission; and (vi) of the happening of any event during the period described in this Section 3.5 that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement, the
Pricing Disclosure Package or the Prospectus untrue or that requires the making of any changes in (a) the Registration Statement in order to make the statements therein not misleading, or (b) in the Pricing Disclosure Package or the Prospectus in
order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company
shall make every reasonable effort to obtain promptly the lifting of such order.
3.6 Review of Financial Statements. For
a period of five (5) years after the date of this Agreement, the Company, at its expense, shall cause its regularly engaged independent registered public accounting firm to review (but not audit) the Company’s financial statements for each of the
three fiscal quarters immediately preceding the announcement of any quarterly financial information.
3.7 Listing. The Company shall
use its best commercial efforts to maintain the listing of the Series A Preferred Shares, the Warrants and the Common Shares (including the Preferred Conversion Shares) on the Exchange for at least two years from the date of this Agreement.
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3.8 Financial Public Relations Firm.
As of the Effective Date, the Company shall have retained a financial public relations firm reasonably acceptable to the Representative and the Company, which shall initially be CapitalLink.
3.9 Reports to the Representative.
3.9.1. Periodic Reports, etc. For a
period of two (2) years after the date of this Agreement, the Company shall furnish or make available to the Representative copies of such financial statements and other periodic and special reports as the Company from time to time furnishes
generally to holders of any class of its securities and also promptly furnish to the Representative: (i) a copy of each periodic report the Company shall be required to file with the Commission under the Exchange Act and the Exchange Act
Regulations; (ii) a copy of every press release and every news item and article with respect to the Company or its affairs which was released by the Company; (iii) a copy of each Form 6-K prepared and filed by the Company; (iv) five copies of each
registration statement filed by the Company under the Securities Act; and (v) such additional documents and information with respect to the Company and the affairs of any future subsidiaries of the Company as the Representative may from time to
time reasonably request; provided the Representative shall sign, if requested by the Company, a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representative and Representative Counsel in connection with the
Representative’s receipt of such information. Documents filed with the Commission pursuant to its ▇▇▇▇▇ system or distributed pursuant to a press release shall be deemed to have been delivered to the Representative pursuant to this Section 3.9.1.
3.9.2. Transfer Agent; Transfer Sheets.
For a period of two (2) years after the date of this Agreement, the Company shall retain a transfer agent and registrar acceptable to the Representative (the “Transfer Agent”) and shall furnish to the
Representative at the Company’s sole cost and expense such transfer sheets of the Company’s securities as the Representative may reasonably request, including the daily and monthly consolidated transfer sheets of the Transfer Agent and DTC. VStock
Transfer LLC is acceptable to the Representative to act as Transfer Agent for the Series A Preferred Shares and the Warrants.
3.9.3. Trading Reports. During such
time as the Public Securities are listed on the Exchange, the Company shall provide to the Representative, at the Company’s expense, such reports published by the Exchange relating to price trading of the Public Securities, as the Representative
shall reasonably request, not to exceed one (1) request per calendar month.
3.10 Payment of Expenses. The
Company hereby agrees to pay on each of the Closing Date and the Option Closing Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement. Such expenses
include, but are not limited to: (i) all filing fees and communication expenses relating to the registration of the Public Securities with the Commission; (ii) all Public Filing System filing fees associated with the review of the Offering by
FINRA; (iii) all fees and expenses relating to the listing of such Public Securities on the Exchange, including any fees charged by the Depositary Trust Company for new securities; (iv) all fees, expenses and disbursements relating to the
registration, qualification or exemption of the Public Securities under the “blue sky” securities laws of such states and other jurisdictions as the Representative may reasonably designate, including, without limitation, all filing and registration
fees; (v) all fees, expenses and disbursements relating to the registration, qualification or exemption of the Public Securities under the securities laws of such foreign jurisdictions as the Representative may reasonably designate; (vi) the costs
of all mailing and printing of the underwriting documents (including, without limitation, this Agreement, any Blue Sky Surveys and, if appropriate, any Agreement Among Underwriters, Selected Dealers’ Agreement, Underwriters’ Questionnaire and Power
of Attorney), Registration Statements, Prospectuses and all amendments, supplements and exhibits thereto and as many preliminary and final Prospectuses as the Representative may reasonably deem necessary; (vii) the costs of preparing, printing and
delivering
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certificates representing the Public Securities; (viii) fees and expenses of the Transfer Agent; (ix) stock transfer and/or stamp taxes,
if any, payable upon the transfer of securities from the Company to the Underwriters; (x) the fees and expenses of the Company’s accountants; and (xi) the fees and expenses of the Company’s legal counsel and other agents and representatives.
Notwithstanding anything to the contrary in this Agreement, the expenses set forth herein to be paid by the Company to the Representative for their actual and accountable out-of-pocket expenses related to the transactions contemplated herein,
including the fees and disbursements of the Underwriters’ legal counsel, shall not exceed $65,000. The Representative may deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or the Option Closing Date, if any, the
expenses set forth herein to be paid by the Company to the Representative; provided, however, that in the event that the Offering is terminated, the Company agrees to reimburse the Representative pursuant to
Section 8.3 hereof, which states, among other things, that in addition to the payments set forth herein, the Advance received by the Representative for out-of-pocket accountable expenses will be reimbursed to the Company to the extent not
actually incurred in compliance with FINRA Rule 5110(f)(2)(C).
3.11 Application of Net Proceeds.
The Company shall apply the net proceeds from the Offering received by it in a manner consistent with the application thereof described under the caption “Use of Proceeds” in the Registration Statement, the Pricing Disclosure Package and the
Prospectus.
3.12 Delivery of Earnings Statements
to Security Holders. The Company shall make generally available to its security holders as soon as practicable, but not later than the first day of the fifteenth (15th) full calendar month following the date of this Agreement, an earnings
statement (which need not be certified by independent registered public accounting firm unless required by the Securities Act or the Securities Act Regulations, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the
Securities Act) covering a period of at least twelve (12) consecutive months beginning after the date of this Agreement, subject to the Company’s periodic filings with the Commission.
3.13 Stabilization. Neither the
Company nor, to its knowledge, any of its employees, directors or shareholders (without the consent of the Representative) has taken or shall take, directly or indirectly, any action designed to or that has constituted or that might reasonably be
expected to cause or result in, under Regulation M of the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Public Securities.
3.14 Internal Controls. Except as
to the extent disclosed in the Registration Statement, the Company shall maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s general or
specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets; (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 existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
3.15 Accountants. The Company
shall continue to retain a nationally recognized independent registered public accounting firm reasonably acceptable to the Representative for a period of at least two (2) years after the date of this Agreement. The Representative acknowledges that
the Auditor is acceptable to the Representative.
3.16 FINRA. For a period of 180
days from the later of the Closing Date or the Option Closing Date, the Company shall advise the Representative (who shall make an appropriate filing with FINRA) if it is or becomes aware that (i) any officer or director of the Company, (ii) any
beneficial owner of 5% or more of any class of the Company’s securities or (iii) any beneficial owner of the Company’s unregistered
24
equity securities which were acquired during the 180 days immediately preceding the filing of the Registration Statement is or becomes an
affiliate or associated person of a FINRA member participating in the Offering (as determined in accordance with the rules and regulations of FINRA).
3.17 No Fiduciary Duties. The
Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely contractual in nature and that none of the Underwriters or their affiliates or any Underwriter shall be deemed to be acting in a fiduciary capacity, or
otherwise owes any fiduciary duty to the Company or any of its affiliates in connection with the Offering and the other transactions contemplated by this Agreement.
3.18 Restriction on Sales of Capital
Stock. The Company, on behalf of itself and any successor entity, agrees that, without the prior written consent of the Representative, it will not, for a period of 60 days after the date of this Agreement (the “Lock-Up Period”), (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose
of, directly or indirectly, any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company; (ii) file or caused to be filed any registration statement with the
Commission relating to the offering of any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company, other than a registration statement on Form S-8 related
to the Pyxis Tankers Inc. 2015 Equity Incentive Plan; (iii) complete any offering of debt securities of the Company, other than entering into a credit facility with a traditional bank or other institutional investor or (iv) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (i), (ii), (iii) or (iv) above is to be settled by
delivery of shares of capital stock of the Company or such other securities, in cash or otherwise.
The restrictions contained in this Section 3.18 shall not apply to (i) the Public Securities to be sold
hereunder, (ii) the issuance by the Company of Common Shares upon the exercise of a stock option or warrant or the conversion of a security outstanding on the date hereof, which is disclosed in the Registration Statement, Pricing Disclosure Package
and Prospectus, provided that such options, warrants, and 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 or to extend the term of such securities, (iii) the issuance by the Company of stock options or shares of capital stock of the Company under the Pyxis Tankers Inc. 2015 Equity Incentive Plan, provided that in each of (ii) and (iii) above,
the underlying shares shall be restricted from sale during the entire Lock-Up Period, (iv) securities issued or registered pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company,
provided that any such issuance shall only be to a person or company or an owner of an asset in a business synergistic with the business of the Company, and (v) such other potential transactions described in Section 7 of the engagement letter, dated
July 21, 2020, between the Company and ThinkEquity referred to in Section 9.5 below; provided such agreements referred to therein are not amended for 60 days following the date hereof.
3.19 [RESERVED]
3.20 Release of D&O Lock-up
Period. If the Representative, in its sole discretion, agrees to release or waive the restrictions set forth in the Lock-Up Agreements described in Section 2.39 hereof for an officer or director of the Company and provide the Company with
notice of the impending release or waiver at least three (3) Business Days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit
C hereto through a major news service at least two (2) Business Days before the effective date of the release or waiver.
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3.21 Blue Sky Qualifications. The
Company shall use its commercially reasonable efforts, in cooperation with the Underwriters, if necessary, to qualify the Public Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic
or foreign) as the Representative may reasonably designate and to maintain such qualifications in effect so long as required to complete the distribution of the Public Securities; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in
which it is not otherwise so subject.
3.22 Emerging Growth Company. The
Company shall promptly notify the Underwriters if the Company ceases to be an Emerging Growth Company prior to December 31, 2020.
3.23 Reporting Requirements. The
Company, during the period when a prospectus relating to the Public Securities is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the Securities Act, will file all documents required to be filed with the
Commission pursuant to the Exchange Act within the time periods required by the Exchange Act and Exchange Act Regulations. Additionally, the Company shall report the use of proceeds from the issuance of the Public Securities as may be required
under Rule 463 under the Securities Act Regulations.
3.24 Prohibition on Press Releases
and Public Announcements. The Company shall not issue press releases or engage in any other publicity, without the Representative’s prior written consent, for a period ending at 5:00 p.m., Eastern time, on the first (1st) Business Day
following the fortieth (40th) day after the Closing Date, other than normal and customary releases issued in the ordinary course of the Company’s business.
3.25 ▇▇▇▇▇▇▇▇-▇▇▇▇▇. Except as
disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company shall at all times comply with all applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act in effect from time to time.
3.26 Pursuant to the Exchange
Act. Prior to the Closing Date, the Company will file with the Commission the Form 8-A providing for the registration pursuant to Section 12(b) under the Exchange Act of the shares of Series A Preferred Shares and the Warrants; and prior to
the Closing Date such Form 8-A will become effective under the Exchange Act. The Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Series A Preferred Shares and/or the Warrants under the
Exchange Act, nor has the Company received any notification that the Commission is contemplating terminating such registration.
3.27 Certificate of Designations.
The Certificate of Designations will be, prior to the Closing Time, duly authorized, executed and filed by the Company with the appropriate office in the Republic of the ▇▇▇▇▇▇▇▇ Islands.
4. Conditions of Underwriters’ Obligations. The
obligations of the Underwriters to purchase and pay for the Public Securities, as provided herein, shall be subject to (i) the continuing accuracy of the representations and warranties of the Company as of the date hereof and as of each of the
Closing Date and the Option Closing Date, if any; (ii) the accuracy of the statements of officers of the Company made pursuant to the provisions hereof; (iii) the performance by the Company of its obligations hereunder; and (iv) the following
conditions:
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4.1 Regulatory Matters.
4.1.1 Effectiveness of Registration Statement; Rule 430A Information. The Registration Statement has become effective not later than 5:00 p.m., Eastern time, on the date of this Agreement or such
later date and time as shall be consented to in writing by you, and, at each of the Closing Date and any Option Closing Date, no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has
been issued under the Securities Act, no order preventing or suspending the use of any Preliminary Prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s
knowledge, contemplated by the Commission. The Company has complied with each request (if any) from the Commission for additional information. The Prospectus containing the Rule 430A Information shall have been filed with the Commission in the
manner and within the time frame required by Rule 424(b) (without reliance on Rule 424(b)(8)) or a post-effective amendment providing such information shall have been filed with, and declared effective by, the Commission in accordance with the
requirements of Rule 430A.
4.1.2 FINRA Clearance. On or
before the date of this Agreement, the Representative shall have received clearance from FINRA as to the amount of compensation allowable or payable to the Underwriters as described in the Registration Statement.
4.1.3 Exchange Stock Market Clearance. On or before the Closing Date, the Company’s Series A Preferred Shares and Warrants and the Common Shares underlying the Warrants and the Common Shares underlying the
Underwriter’s Warrants) shall have been approved for listing on the Exchange, subject only to official notice of issuance.
4.2 Company Counsel Matters.
4.2.1 Closing Date Opinion of U.S.
Counsel. On the Closing Date, the Representative shall have received the favorable opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, U.S. corporate and securities counsel to the Company, and a written statement providing certain “10b-5” negative
assurances, dated the Closing Date and addressed to the Representative, in form and substance reasonably satisfactory to the Representative.
4.2.2 Closing Date Opinion of ▇▇▇▇▇▇▇▇
Islands Counsel. On the Closing Date, the Representative shall have received the favorable opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, special ▇▇▇▇▇▇▇▇ Islands counsel to the Company, dated the Closing Date and addressed to the Representative, in
form and substance reasonably satisfactory to the Representative.
4.2.3 Closing Date Opinion of Malta
Counsel. On the Closing Date, the Representative shall have received the favorable opinion of [ ], special Malta counsel to the Company, dated the Closing Date and addressed to the Representative, in form and substance reasonably
satisfactory to the Representative.
4.2.4 Option Closing Date Opinions of
Counsel. On the Option Closing Date, if any, the Representative shall have received the favorable opinion and “10b-5” negative assurances of counsel listed in Section 4.2.1 and the favorable opinion of counsel listed in Section 4.2.2 and
4.2.3, each dated as of the Option Closing Date, addressed to the Representative and in form and substance reasonably satisfactory to the Representative, confirming as of the Option Closing Date, the statements made by such counsel in its opinion,
and as to the counsel listed in Section 4.2.1 the “10b-5” negative assurances, delivered on the Closing Date.
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4.2.5 Reliance. In rendering such
opinion, counsel may rely: (i) as to matters involving the application of laws other than the laws of the United States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to the extent specified in such
opinion, if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to the Representative) of other counsel reasonably acceptable to the Representative, familiar with the applicable laws; and (ii) as to matters of fact,
to the extent they deem proper, on certificates or other written statements of officers of the Company and officers of departments of various jurisdictions having custody of documents respecting the corporate existence or good standing of the
Company; provided that copies of any such statements or certificates shall be delivered to Representative Counsel if requested. The opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP and any opinion relied upon by ▇▇▇▇▇▇
& ▇▇▇▇▇▇ LLP shall include a statement to the effect that it may be relied upon by Representative Counsel in its opinion delivered to the Underwriters.
4.3 Comfort Letters.
4.3.1 Cold Comfort Letter. At the
time this Agreement is executed the Underwriters shall have received cold comfort letters from the Auditor containing statements and information of the type customarily included in accountants’ comfort letters with respect to the financial
statements and certain financial information contained or incorporated or deemed incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus, addressed to the Representative and in form and substance
satisfactory in all respects to you and to the Auditor, dated as of the date of this Agreement.
4.3.2 Bring-down Comfort Letter. At
each of the Closing Date and the Option Closing Date, if any, the Representative shall have received from the Auditor letters, dated as of the Closing Date or the Option Closing Date, as applicable, to the effect that the Auditor each reaffirm the
statements made in their letters furnished pursuant to Section 4.3.1, except that the specified date referred to shall be a date not more than three (3) business days prior to the Closing Date or the Option Closing Date, as applicable.
4.4 Officers’ Certificates.
4.4.1 Officers’ Certificate. The
Company shall have furnished to the Representative a certificate, dated the Closing Date and any Option Closing Date (if such date is other than the Closing Date), of its Chief Executive Officer and its Chief Financial Officer stating that (i) such
officers have carefully examined the Registration Statement, the Pricing Disclosure Package, any Issuer Free Writing Prospectus and the Prospectus and, in their opinion, the Registration Statement and each amendment thereto, as of the Applicable
Time and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date) did not include any untrue statement of a material fact and did not omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and the Pricing Disclosure Package, as of the Applicable Time and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), any Issuer Free Writing Prospectus as of
its date and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), and the Prospectus and each amendment or supplement thereto, as of the respective date thereof and as of
the Closing Date, did not include any untrue statement of a material fact and did not omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances in which they were made, not misleading, (ii)
since the initial effective date of the Registration Statement, no event has occurred which should have been set forth in a supplement or amendment to the Registration Statement, the Pricing Disclosure Package or the Prospectus, (iii) to the best
of their knowledge after reasonable investigation, as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), the representations and warranties of the Company in this Agreement are true and correct and the
Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date (or any Option Closing Date if such date is other than the Closing Date), and (iv) there has
not been, subsequent to the date of the most recent audited financial statements
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included or incorporated by reference in the Pricing Disclosure Package, any material adverse change in the financial position or results
of operations of the Company, or any change or development that, singularly or in the aggregate, would involve a material adverse change or a prospective material adverse change, in or affecting the condition (financial or otherwise), results of
operations, business, assets or prospects of the Company, except as set forth in the Prospectus.
4.4.2 Secretary’s Certificate. At
each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate of the Company signed by the Secretary of the Company, dated the Closing Date or the Option Date, as the case may be, respectively,
certifying: (i) that each of the Charter and Bylaws is true and complete, has not been modified and is in full force and effect; (ii) that the resolutions of the
Company’s Board of Directors relating to the Offering are in full force and effect and have not been modified; (iii) as to the accuracy and completeness of all correspondence between the Company or its counsel and the Commission; and (iv) as to the
incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.
4.4.3 Chief Financial Officer’s
Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate of the Chief Financial Officer of the Company, dated the Closing Date or the Option Date, as the case may be,
respectively, with respect to the accuracy of certain information contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus, in a form reasonably acceptable to the
Representative.
4.5 No Material Changes. Prior
to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no material adverse change or development involving a prospective Material Adverse Effect in the condition or prospects 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 no change in the capital stock or debt of the Company, the Pricing Disclosure Package and the Prospectus; (ii) no
action, suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Insider before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision,
ruling or finding may materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus; (iii) no
stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; (iv) no action shall have been taken and no law, statute, rule, regulation or order shall have been
enacted, adopted or issued by any Governmental Entity which would prevent the issuance or sale of the Public Securities or materially and adversely affect or potentially materially and adversely affect the business or operations of the Company; (v)
no injunction, restraining order or order of any other nature by any federal or state court of competent jurisdiction shall have been issued which would prevent the issuance or sale of the Public Securities or materially and adversely affect or
potentially materially and adversely affect the business or operations of the Company and (vi) the Registration Statement, the Pricing Disclosure Package and the Prospectus and any amendments or supplements thereto shall contain all material
statements which are required to be stated therein in accordance with the Securities Act and the Securities Act Regulations and shall conform in all material respects to the requirements of the Securities Act and the Securities Act Regulations, and
neither the Registration Statement, the Pricing Disclosure Package, the Prospectus nor any amendment or supplement thereto shall 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, in the light of the circumstances under which they were made, not misleading.
4.6 No Material Misstatement or
Omission. The Underwriters shall not have discovered and disclosed to the Company on or prior to the Closing Date and any Option Closing Date that the Registration Statement or any amendment or supplement thereto contains an untrue statement
of a fact which, in the
29
opinion of Representative Counsel, is material or omits to state any fact which, in the opinion of such counsel, is material and is
required to be stated therein or is necessary to make the statements therein not misleading, or that the Registration Statement, Pricing Disclosure Package or the Prospectus or any amendment or supplement thereto contains an untrue statement of fact
which, in the opinion of such counsel, is material or omits to state any fact which, in the opinion of such counsel, is material and is necessary in order to make the statements, in the light of the circumstances under which they were made, not
misleading.
4.7 Corporate Proceedings. All corporate proceedings and other legal matters incident to the
authorization, form and validity of each of this Agreement, the Public Securities, the Underwriter’s Warrant Agreements, the Registration Statement, the Pricing Disclosure Package and the Prospectus and all other legal matters relating to this
Agreement and the transactions contemplated hereby and thereby shall be reasonably satisfactory in all material respects to Representative Counsel, and the Company shall have furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
4.8 Delivery of Agreements.
4.8.1 Lock-Up Agreements. On or
before the date of this Agreement, the Company shall have delivered to the Representative executed copies of the Lock-Up Agreements from each of the persons listed in Schedule 3 hereto.
4.8.2 Closing Date Deliveries. On
the Closing Date, the Company shall have delivered to the Representative executed copies of the Underwriter’s Warrant Agreements
4.9 Filing of Form 8-A. Prior
to the Closing Date, (i) the Company has filed with the Commission the Form 8-A and (ii) the Form 8-A has become effective under the Exchange Act.
4.10 Certificate of Designations.
Prior to the Closing Date, the Certificate of Designations shall be duly authorized, executed and filed by the Company with the appropriate office in the Republic of the ▇▇▇▇▇▇▇▇ Islands.
4.11 Additional Documents. At the
Closing Date and at each Option Closing Date (if any) Representative Counsel shall have been furnished with such documents and opinions as they may reasonably require for the purpose of enabling Representative Counsel to deliver an opinion to the
Underwriters, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the
Public Securities as herein contemplated shall be satisfactory in form and substance to the Representative and Representative Counsel.
5. Indemnification.
5.1 Indemnification of the
Underwriters.
5.1.1 General. Subject to the
conditions set forth below, the Company agrees to indemnify and hold harmless each Underwriter, its affiliates and each of its and their respective directors, officers, members, employees, representatives, partners, shareholders, affiliates,
counsel and agents and each person, if any, who controls any such Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively the “Underwriter Indemnified
Parties,” and each an “Underwriter Indemnified Party”), against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses
reasonably incurred in
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investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of
any action between any of the Underwriter Indemnified Parties and the Company or between any of the Underwriter Indemnified Parties and any third party, or otherwise) to which they or any of them may become subject under the Securities Act, the
Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries (a “Claim”), arising out of or based upon any untrue statement or alleged untrue statement of a material
fact contained in (i) the Registration Statement, the Pricing Disclosure Package, the Preliminary Prospectus, the Prospectus, or any Issuer Free Writing Prospectus (as from time to time each may be amended and supplemented) or this Underwriting
Agreement; (ii) any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the Offering, including any “road show” or investor presentations made to
investors by the Company (whether in person or electronically); (iii) any application or other document or written communication (in this Section 5, collectively
called “application”) executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Public
Securities under the securities laws thereof or filed with the Commission, any state securities commission or agency, the Exchange or any other national securities exchange; or the omission or alleged omission therefrom of 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, unless such statement or omission was made in reliance upon, and in conformity with, the Underwriters’
Information, or (iv) otherwise arising in connection with or allegedly in connection with the Offering. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Registration Statement, Pricing
Disclosure Package or Prospectus, the indemnity agreement contained in this Section 5.1.1 shall not inure to the benefit of any Underwriter Indemnified Party to the extent that any loss, liability, claim, damage or expense of such Underwriter
Indemnified Party results from the fact that a copy of the Prospectus was not given or sent to the person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Public Securities to such person as
required by the Securities Act and the Securities Act Regulations, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its
obligations under Section 3.3 hereof. The Company also agrees that it will reimburse each Underwriter Indemnified Party for all fees and expenses (including but not limited to any and all legal or other expenses
reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between any of the Underwriter Indemnified Parties and the Company or between
any of the Underwriter Indemnified Parties and any third party, or otherwise) (collectively, the “Expenses”), and further agrees wherever and whenever
possible to advance payment of Expenses as they are incurred by an Underwriter Indemnified Party in investigating, preparing, pursuing or defending any Claim.
5.1.2 Procedure. If any action is
brought against an Underwriter Indemnified Party in respect of which indemnity may be sought against the Company pursuant to Section 5.1.1, such Underwriter Indemnified Party shall promptly notify the Company in writing of the institution of such
action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the approval of such Underwriter Indemnified Party) and payment of actual expenses if an Underwriter Indemnified Party requests
that the Company do so. Such Underwriter Indemnified Party shall have the right to employ its or their own counsel in any such case (including local counsel), and the Company shall bear the reasonable fees, costs and expenses of such separate
counsel if (i) the use of counsel chosen by the Company to represent the Underwriter Indemnified Party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both
the Underwriter Indemnified Party and the Company and the Underwriter Indemnified Party shall have reasonably concluded that that a conflict may arise between the positions of the Company and the Indemnified Party and/or there may be legal defenses
available to it and/or other indemnified parties that are different from or additional to those available to the Company, (iii) the Company shall not have employed counsel reasonably satisfactory to the Underwriter Indemnified Party to represent
the Underwriter Indemnified Party or (iv) the
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Company shall authorize the Underwriter Indemnified Party to employ separate counsel at the expense of the Company, provided however,
that the Company shall not be obligated to bear the reasonable fees and expenses of more than one firm of attorneys selected by the Underwriter Indemnified Party (in addition to local counsel). The Company shall not be liable for any settlement of
any action effected without its consent (which shall not be unreasonably withheld). In addition, the Company shall not, without the prior written consent of the Underwriters, 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 advancement, reimbursement, indemnification or contribution may be sought hereunder (whether or not such Underwriter Indemnified Party is a party thereto) unless such settlement,
compromise, consent or termination (i) includes an unconditional release of each Underwriter Indemnified Party, acceptable to such Underwriter Indemnified Party, from all liabilities, expenses and claims arising out of such action for which
indemnification or contribution may be sought and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any Underwriter Indemnified Party.
5.2 Indemnification of the Company.
Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company, its directors, its officers who signed the Registration Statement and persons who control the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to the several Underwriters, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions made in the Registration Statement, any Preliminary Prospectus, the Pricing Disclosure Package or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in
strict conformity with, the Underwriters’ Information. In case any action shall be brought against the Company or any other person so indemnified based on any Preliminary Prospectus, the Registration Statement, the Pricing Disclosure Package or
Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against any Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other
person so indemnified shall have the rights and duties given to the several Underwriters by the provisions of Section 5.1.2. The Company agrees promptly to notify the Representative of the commencement of any litigation or proceedings
against the Company or any of its officers, directors or any person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, in connection with the
issuance and sale of the Public Securities or in connection with the Registration Statement, the Pricing Disclosure Package, the Prospectus or any Issuer Free Writing Prospectus.
5.3 Contribution.
5.3.1 Contribution Rights. If the
indemnification provided for in this Section 5 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 5.1 or 5.2 in respect of any loss, claim, damage or liability, or any action
in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company, on the one hand, and the Underwriters, on the other, from the Offering of the Public Securities, or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, on the one hand,
and the Underwriters, on the other, with respect to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitable considerations. The relative benefits
received by the Company, on the one hand, and the Underwriters, on the other, with respect to such Offering shall be deemed to be in the same proportion as the total net proceeds from the Offering of the Public Securities purchased under this
Agreement (before deducting expenses) received by the Company, as set forth in the table on the cover
32
page of the Prospectus, on the one hand, and the total underwriting discounts and commissions received by the Underwriters with respect
to the securities purchased under this Agreement, as set forth in the table on the cover page of the Prospectus, on the other hand. The relative fault shall be determined by reference to whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 5.3.1 were to be determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 5.3.1 shall be deemed to include, for purposes of this Section 5.3.1, any legal or other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the provisions of this Section 5.3.1 in no event shall an Underwriter be required to contribute any amount in excess of the amount by which the total underwriting discounts
and commissions received by such Underwriter with respect to the Offering of the Public Securities exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
5.3.2 Contribution Procedure.
Within fifteen (15) days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against
another party (“contributing party”), notify the contributing party of the commencement thereof, but the failure to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for
contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative of the commencement thereof within the aforesaid 15 days, the contributing party
will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim,
action or proceeding affected by such party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written consent of such
contributing party. The contribution provisions contained in this Section 5.3.2 are intended to supersede, to the extent permitted by law, any right to contribution
under the Securities Act, the Exchange Act or otherwise available. Each Underwriter’s obligations to contribute pursuant to this Section 5.3 are several and not
joint.
6. Default by an Underwriter.
6.1 Default Not Exceeding 10% of
Firm Securities or Option Shares. If any Underwriter or Underwriters shall default in its or their obligations to purchase the Firm Securities or the Option Shares, if the Over-allotment Option is exercised hereunder, and if the number of the
Firm Securities or Option Shares with respect to which such default relates does not exceed in the aggregate 10% of the number of Firm Securities or Option Shares that all Underwriters have agreed to purchase hereunder, then such Firm Securities or
Option Shares to which the default relates shall be purchased by the non-defaulting Underwriters in proportion to their respective commitments hereunder.
6.2 Default Exceeding 10% of Firm
Securities or Option Shares. In the event that the default addressed in Section 6.1 relates to more than 10% of the Firm Securities or Option Shares, the Representative may in your discretion arrange for yourself or for another party or
parties to purchase such Firm Securities or Option Shares to which such default relates on the terms contained herein. If, within
33
one (1) Business Day after such default relating to more than 10% of the Firm Securities or Option Shares, you do not arrange for the
purchase of such Firm Securities or Option Shares, then the Company shall be entitled to a further period of one (1) Business Day within which to procure another party or parties satisfactory to you to purchase said Firm Securities or Option Shares
on such terms. In the event that neither you nor the Company arrange for the purchase of the Firm Securities or Option Shares to which a default relates as provided in this Section 6, this Agreement will automatically be terminated by you or the
Company without liability on the part of the Company (except as provided in Section 3.9 and Section 5 hereof) or the several Underwriters (except as provided in Section 5 hereof); provided,
however, that if such default occurs with respect to the Option Shares, this Agreement will not terminate as to the Firm Securities; and provided, further, that nothing herein shall relieve a defaulting Underwriter of its liability, if any, to the other Underwriters and to the Company for damages occasioned by its default hereunder.
6.3 Postponement of Closing
Date. In the event that the Firm Securities or Option Shares to which the default relates are to be purchased by the non-defaulting Underwriters, or are to be purchased by another party or parties as aforesaid, the Representative or the
Company shall have the right to postpone the Closing Date or Option Closing Date for a reasonable period, but not in any event exceeding five (5) Business Days, in order to effect whatever changes may thereby be made necessary in the Registration
Statement, the Pricing Disclosure Package or the Prospectus or in any other documents and arrangements, and the Company agrees to file promptly any amendment to the Registration Statement, the Pricing Disclosure Package or the Prospectus that in
the opinion of counsel for the Underwriter may thereby be made necessary. The term “Underwriter” as used in this Agreement shall include any party substituted under this Section 6 with like effect as if it
had originally been a party to this Agreement with respect to such Common Shares.
7. Additional Covenants.
7.1 Board Composition and Board
Designations. The Company shall ensure that: (i) the qualifications of the persons serving as members of the Board of Directors and the overall composition of the Board comply with the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act, with the Exchange Act and with the
listing rules of the Exchange or any other national securities exchange, as the case may be, in the event the Company seeks to have any of its securities listed on another exchange or quoted on an automated quotation system, and (ii) if applicable,
at least one member of the Audit Committee of the Board of Directors qualifies as an “audit committee financial expert,” as such term is defined under Regulation S-K and the listing rules of the Exchange.
7.2 Right of First Refusal.
Provided that the Firm Securities are sold in accordance with the terms of this Agreement, the Representative shall have an irrevocable right of first refusal (the “Right of First Refusal”), until twelve
months following the Closing Date, to act as sole investment banker, sole book-runner, sole underwriter and/or sole placement agent, at the Representative’s sole discretion, for each and every future public offering of Series A Preferred Shares
(each, a “Subject Transaction”), during such period, of the Company, or any successor to or subsidiary of the Company, on terms and conditions customary to the Representative for such Subject Transactions.
For the avoidance of any doubt, the Company shall not retain, engage or solicit any additional investment banker, book-runner, financial advisor, underwriter and/or placement agent in a Subject Transaction without the express written consent of the
Representative. The Representative shall have the sole right to determine whether or not any other broker dealer shall have the right to participate in any Subject Transaction in which it exercises its right of first refusal and the economic terms
of any such participation.
The Company shall notify the Representative of its intention to pursue a Subject Transaction, including the material
terms thereof, by providing written notice thereof by registered or electronic mail or overnight courier service addressed to the Representative. If the Representative fails to exercise its Right
34
of First Refusal with respect to any Subject Transaction within ten (10) Business Days after the mailing of such written or electronic
notice, then the Representative shall have no further claim or right with respect to the Subject Transaction. The Representative may elect, in its sole and absolute discretion, not to exercise its Right of First Refusal with respect to any Subject
Transaction; provided that any such election by the Representative shall not adversely affect the Representative’s Right of First Refusal with respect to any other Subject Transaction during the period agreed to above.
8. Effective Date of this Agreement and Termination
Thereof.
8.1 Effective Date of this
Agreement. This Agreement shall become effective when both the Company and the Representative have executed the same and delivered counterparts of such signatures to the other party.
8.2 Termination. The
Representative shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any domestic or international event or act or occurrence has materially disrupted, or in your opinion will in the immediate future
materially disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange or the Nasdaq Stock Market LLC shall have been suspended or materially limited, or minimum or maximum prices for trading shall
have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction; or (iii) if the United States shall have become involved in a new
war or an increase in major hostilities; or (iv) if a banking moratorium has been declared by a New York State or federal authority; or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United
States securities markets; or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured,
will, in your opinion, make it inadvisable to proceed with the delivery of the Firm Securities or Option Shares; or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder; or (viii) if the
Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such adverse material change in general market conditions as in the Representative’s judgment would
make it impracticable to proceed with the offering, sale and/or delivery of the Public Securities or to enforce contracts made by the Underwriters for the sale of the Public Securities.
8.3 Expenses. Notwithstanding
anything to the contrary in this Agreement, except in the case of a default by the Underwriters, pursuant to Section 6.2 above, in the
event that this Agreement shall not be carried out for any reason whatsoever, within the time specified herein or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Representative the fees
set forth in Section 3.10 (including the fees and disbursements of Representative’s Counsel) and to reimburse the Representative for its actual and accountable out-of-pocket expenses related to the transactions contemplated herein then due
and payable up to a maximum of $65,000, and upon demand the Company shall pay the full amount thereof to the Representative on behalf of the Underwriters; provided,
however, that such expense cap in no way limits or impairs the indemnification and contribution provisions of this Agreement. Notwithstanding the foregoing, the advance received by the Representative in the
amount of $10,000 (the “Advance”) will be reimbursed to the Company to the extent not actually incurred in compliance with FINRA Rule 5110(f)(2)(C).
8.4 Survival of Indemnification.
Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall remain in full force and
effect and shall not be in any way affected by, such election or termination or failure to carry out the terms of this Agreement or any part hereof.
35
8.5 Representations, Warranties,
Agreements to Survive. All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i)
any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or directors or any person controlling the Company or (ii) delivery of and payment for the Public
Securities.
9. Miscellaneous.
9.1 Notices. All communications
hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed (registered or certified mail, return receipt requested), personally delivered or sent by e-mail or facsimile transmission and confirmed and shall
be deemed given when so delivered, e-mailed or faxed and confirmed or if mailed, two (2) days after such mailing.
If to the Representative:
ThinkEquity, a division of Fordham Financial Management, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇, Head of Investment Banking
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇, Head of Investment Banking
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
e-mail: ▇▇@▇▇▇▇▇-▇▇▇▇▇▇.▇▇▇
with a copy (which shall not constitute notice) to:
Gracin & ▇▇▇▇▇▇, LLP
The Chrysler Building
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq. or ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
The Chrysler Building
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq. or ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Fax No: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ or ▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
If to the Company:
59 K. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
Attention: Valentios (“▇▇▇▇▇”) Valentis, Chief Executive Officer
Fax No: [_____]
E-mail address: [_____]
with a copy (which shall not constitute notice) to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
E-mail address: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
36
9.2 Research Analyst Independence.
The Company acknowledges that each Underwriter’s research analysts and research departments, if any, are required to be independent from its investment banking division and are subject to certain regulations and internal policies, and that such
Underwriter’s research analysts may hold views and make statements or investment recommendations and/or publish research reports with respect to the Company and/or the Offering that differ from the views of their investment banking division. The
Company acknowledges that each Underwriter is a full service securities firm and as such from time to time, subject to applicable securities laws, rules and regulations, may effect transactions for its own account or the account of its customers
and hold long or short positions in debt or equity securities of the Company; provided, however, that nothing in this Section 9.2 shall relieve the Underwriter of
any responsibility or liability it may otherwise bear in connection with activities in violation of applicable securities laws, rules or regulations.
9.3 Headings. The headings
contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of this Agreement.
9.4 Amendment. This Agreement
may only be amended by a written instrument executed by each of the parties hereto.
9.5 Entire Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with this Agreement) constitutes the entire agreement of the parties hereto with respect to the subject matter
hereof and thereof, and supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof. Notwithstanding anything to the contrary set forth herein, it is understood and agreed by the
parties hereto that all other terms and conditions of that certain engagement letter between the Company and ThinkEquity, a division of Fordham Financial Management, Inc., dated July 21, 2020, shall remain in full force and effect.
9.6 Binding Effect. This
Agreement shall inure solely to the benefit of and shall be binding upon the Representative, the Underwriters, the Company and the controlling persons, directors and officers referred to in Section 5 hereof, and their respective successors, legal
representatives, heirs and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Agreement or any provisions herein contained. The term “successors
and assigns” shall not include a purchaser, in its capacity as such, of securities from any of the Underwriters.
9.7 Tax Disclosure.
Notwithstanding any other provision of this Agreement, from the commencement of discussions with respect to the transactions contemplated hereby, the Company (and each employee, representative or other agent of the Company) may disclose to any and
all persons, without limitation of any kind, the tax treatment and tax structure (as such terms are used in Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations promulgated thereunder) of the transactions contemplated by this
Agreement and all materials of any kind (including opinions or other tax analyses) that are provided relating to such tax treatment and tax structure.
9.8 Governing Law; Consent to
Jurisdiction; Trial by Jury. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflict of laws principles thereof. The Company hereby agrees that any
action, proceeding or claim against it arising out of, or relating in any way to this Agreement shall be brought and enforced 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 irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Any such process or summons to
be served upon the Company may be served by
37
transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address
set forth in Section 9.1 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim. The Company agrees that the prevailing party(ies) in any such action shall be entitled
to recover from the other party(ies) all of its reasonable attorneys’ fees and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor. The Company (on its behalf and, to the extent permitted by
applicable law, on behalf of its stockholders and affiliates) and each of the Underwriters hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
9.9 Jurisdiction. The
Underwriters and the Company agree that any suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in any federal or New York State court located in the City and County of
New York (a “New York Court”), and waive any objection which they may now or hereafter have to the laying of venue of any such proceeding, and irrevocably submit to the non-exclusive jurisdiction of such
courts in any suit, action or proceeding. The Company hereby irrevocably designates and appoints Pyxis Maritime (USA) LLC (the “Process Agent”) as its authorized agent upon whom process may be served in any
claim brought against the Company, it being understood that the designation and appointment of the Process Agent as such authorized agent shall become effective immediately without any further action on the part of the Company. The Company
represents to each Underwriter that it has notified the Process Agent of such designation and appointment and that the Process Agent has accepted the same. The Company hereby irrevocably authorizes and directs the Process Agent to accept such
service. The Company further agrees that service of process upon the Process Agent and written notice of said service to the Company, mailed by first-class mail and delivered to the Process Agent, shall be deemed in every respect effective service
of process upon the Company in any such claim. Nothing herein shall affect the right of each Underwriter, its partners, directors, officers and members, any person who controls any Underwriter within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, or any “affiliate” (within the meaning of Rule 405 under the Securities Act) of such Underwriter, or the successors and assigns of all of the foregoing persons, to serve process in any other manner permitted by
law. The provisions of this Section 16 shall survive any termination of this Agreement, in whole or in part.
9.10 Execution in Counterparts.
This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement,
and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of the other parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf transmission
shall constitute valid and sufficient delivery thereof.
9.11 Waiver, etc. The failure of
any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed or construed to be a waiver of any such provision, nor to in any way effect the validity of this Agreement or any provision hereof or the
right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a
written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or
subsequent breach, non-compliance or non-fulfillment.
[Signature Page Follows]
38
If the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in
the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between us.
|
Very truly yours,
|
||||
|
By:
|
||||
|
Name:
|
Valentios (“▇▇▇▇▇”) ▇▇▇▇▇▇▇▇
|
|||
|
Title:
|
Chief Executive Officer
|
|||
Confirmed as of the date first written above
mentioned, on behalf of itself and as
Representative of the several Underwriters
named on Schedule 1 hereto:
mentioned, on behalf of itself and as
Representative of the several Underwriters
named on Schedule 1 hereto:
THINKEQUITY,
A Division of Fordham Financial Management, Inc.
|
By:
|
|||
|
Name:
|
▇▇▇▇ ▇▇▇▇
|
||
|
Title:
|
Head of Investment Banking
|
||
[Signature Page]
SCHEDULE 1
|
Underwriter
|
Total Number of
Firm Shares
to be
Purchased
|
Total Number of
Firm
Warrants to
be
Purchased
|
Number of
Option Shares
to be Purchased if
the Over-
Allotment Option
is Fully Exercised
|
Number of
Option
Warrants to be
Purchased if the
Over-Allotment
Option is Fully
Exercised
|
||||
|
ThinkEquity, a division of Fordham Financial Management, Inc.
|
|
|||||||
|
|
|
|
|
|
||||
|
TOTAL
|
Sch. 1-1
SCHEDULE 2-A
Pricing Information
Number of Firm Shares: [•]
Number of Firm Warrants: [•]
Number of Option Shares: [•]
Number of Option Warrants: [•]
Public Offering Price per one Share and [__] Warrants: $[•]
Underwriting Discount per Share and [•] Warrant: $[•]
Proceeds to Company per Share and Warrant (before expenses): $[•]
SCHEDULE 2-B
Issuer General Use Free Writing Prospectuses
SCHEDULE 2.11
SUBSIDIARY LIST
|
Name
|
Jurisdiction of Incorporation
|
|
Secondone Corporation Ltd.
|
Malta
|
|
Thirdone Corporation Ltd.
|
Malta
|
|
Fourthone Corporation Ltd.
|
Malta
|
|
Seventhone Corp.
|
Republic of the ▇▇▇▇▇▇▇▇ Islands
|
|
Eighthone Corp.
|
Republic of the ▇▇▇▇▇▇▇▇ Islands
|
SCHEDULE 2.25
VESSEL LIST
|
Vessel Name
|
Vessel Owning Subsidiaries
|
Flag
|
|
Pyxis Epsilon
|
Eigthone Corp.
|
Republic of the ▇▇▇▇▇▇▇▇ Islands
|
|
Pyxis Theta
|
Seventhone Corp.
|
Malta
|
|
Pyxis Malou
|
Fourthone Corp.
|
Malta
|
|
Northsea Alpha
|
Secondone Corp.
|
Malta
|
|
Northsea Beta
|
Thirdone Corp
|
Malta
|
SCHEDULE 3
List of Lock-Up Parties
Valentios (“▇▇▇▇▇”) ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
EXHIBIT A
Form of Underwriter’s Warrant Agreement
EXHIBIT B
Form of Lock-Up Agreement
|
__________, 2020
|
ThinkEquity,
A Division of Fordham Financial Management, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
As Representative of the several Underwriters (if any) named on Schedule 1 to the Underwriting Agreement reference
below
Ladies and Gentlemen:
The undersigned understands that you (the “Representative”) and certain other
firms, if any (the “Underwriters”), propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with Pyxis
Tankers Inc., a ▇▇▇▇▇▇▇▇ Island corporation (the “Company”), providing for the purchase by the Underwriters of certain of the Company’s securities, including its 7.75% Series A Cumulative
Convertible Preferred Shares (the “Series A Preferred Shares”) and warrants (the “Warrants”) to purchase the Company’s common
shares, par value $0.001 per share (the “Common Shares”), and that the Underwriters propose to reoffer the Series A Preferred Shares and Warrants to the public (the “Offering”). The Series A Preferred Shares and Warrants are referred to herein as the “Offered Securities.”
In consideration of the execution of the Underwriting Agreement by the Underwriters, and for other good and valuable consideration, the
undersigned hereby irrevocably agrees that, without the prior written consent of the Representative, on behalf of the Underwriters, the undersigned will not, directly or indirectly, (1) offer for sale, sell, pledge, or otherwise transfer or dispose
of (or enter into any transaction or device that is designed to, or could be expected to, result in the transfer or disposition by any person at any time in the future of) any Offered Securities or Common Shares (including, without limitation,
Offered Securities or Common Shares that may be deemed to be beneficially owned by the undersigned in accordance with the rules and regulations of the Securities and Exchange Commission and Offered Securities or Common Shares that may be issued upon
exercise of any options or warrants) or securities convertible into or exercisable or exchangeable for Offered Securities or Common Shares, (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any
of the economic benefits or risks of ownership of Offered Securities or Common Shares, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Offered Securities or Common Shares or other securities, in cash
or otherwise, (3) except as provided for below, make any demand for or exercise any right or cause to be filed a registration statement, including any amendments thereto, with respect to the
registration of any Offered Securities or Common Shares or securities convertible into or exercisable or exchangeable for Offered Securities or Common Shares or any other securities of the Company, or (4) publicly disclose the intention to do any of
the foregoing for a period commencing on the date hereof and ending sixty (60) days after the closing of the Offering (such 60-day period, the “Lock-Up Period”).
The foregoing paragraph shall not apply to (a) transactions relating to Offered Securities or Common Shares or other securities acquired in
the open market after the completion of the Offering, provided that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), shall be required or shall be voluntarily made in connection with such transactions; (b) bona fide gifts
of shares of any class of the Company’s capital stock or any security convertible into Offered Securities or Common Shares, in each case that are made exclusively between and among the undersigned
or members of the undersigned’s family, or affiliates of the undersigned, including its partners (if a partnership) or members
(if a limited liability company); (c) any transfer of Offered Securities or Common Shares or any security convertible into Offered Securities or Common Shares by will or
intestate succession upon the death of the undersigned; (d) transfer of Offered Securities or Common Shares or any security convertible into Offered Securities or Common
Shares to an immediate family member (for purposes of this Lock-Up Letter Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin) or any trust, limited partnership, limited
liability company or other entity for the direct or indirect benefit of the undersigned or any immediate family member of the undersigned; provided that,
in the case of clauses (b)-(d) above, it shall be a condition to any such transfer that (i) the transferee/donee agrees to be bound by the terms of this Lock-Up Letter Agreement (including, without limitation, the restrictions set forth in the
preceding sentence) to the same extent as if the transferee/donee were a party hereto, (ii) each party (donor, donee, transferor or transferee) shall not be required by law (including without limitation the disclosure requirements of the Securities
Act of 1933, as amended (the “Securities Act”), and the Exchange Act) to make, and shall agree to not voluntarily make, any filing or
public announcement of the transfer or disposition prior to the expiration of the Lock-Up Period referred to above, and (iii) the undersigned notifies the Representative at least two business days prior to the proposed transfer or disposition; (e)
the transfer of shares to the Company to satisfy withholding obligations for any equity award granted pursuant to the terms of the Company’s option/incentive plans, such as upon exercise, vesting, lapse of substantial risk of forfeiture, or other
similar taxable event, in each case on a “cashless” or “net exercise” basis (which, for the avoidance of doubt shall not include “cashless” exercise programs involving a broker or other third party), provided that as a condition of any transfer pursuant to this clause (e), that if the undersigned is required to file a report under Section 16(a) of the Exchange Act, reporting a reduction in
beneficial ownership of Offered Securities or Common Shares or any securities convertible into or exercisable or exchangeable for Common Shares during the Lock-Up Period, the undersigned shall include a
statement in such report, and if applicable an appropriate disposition transaction code, to the effect that such transfer is being made as a share delivery or forfeiture in connection with a net value exercise, or as a forfeiture or sale of shares
solely to cover required tax withholding, as the case may be; (f) transfers of Offered Securities or Common Shares or any security convertible into or exercisable or exchangeable for Common Shares pursuant to a bona fide third party tender
offer made to all holders of the Offered Securities or Common Shares, merger, consolidation or other similar transaction involving a change of control (as defined below) of the Company, including voting in favor of any such transaction or taking any
other action in connection with such transaction, provided that in the event that such merger, tender offer or other transaction is not completed, the Offered Securities or Common Shares and any security
convertible into or exercisable or exchangeable for Offered Securities or Common Shares shall remain subject to the restrictions set forth herein; (g) the exercise of warrants or the exercise of options to
purchase Common Shares granted pursuant to the Company’s option/incentive plans or otherwise outstanding on the date hereof; provided, that the restrictions shall apply to Common Shares issued upon such
exercise or conversion; (h) the establishment of any contract, instruction or plan that satisfies all of the requirements of Rule 10b5-1 (a “Rule 10b5-1 Plan”) under the Exchange Act; provided, however, that no sales of Offered Securities or Common Shares or securities convertible into, or exchangeable or exercisable for, Offered Securities or Common
Shares, shall be made pursuant to a Rule 10b5-1 Plan prior to the expiration of the Lock-Up Period; provided further, that the Company is not required to report the
establishment of such Rule 10b5-1 Plan in any public report or filing with the Commission under the Exchange Act during the lock-up period and does not otherwise voluntarily effect any such public filing or report regarding such Rule 10b5-1 Plan; and
(i) any demands or requests for, or exercise of any right with respect to, or the taking of any action in preparation of, the registration by the Company under the Securities Act of the undersigned’s Offered Securities or Common Shares, provided
that no transfer of the undersigned’s Offered Securities or Common Shares registered pursuant to the exercise of any such right and no registration statement shall be filed under the Securities Act with respect to any of the undersigned’s Offered
Securities or Common Shares during the Lock-Up Period. For purposes of clause (f) above, “change of control” shall mean the consummation of any bona fide third party tender offer, merger,
purchase, consolidation or other similar transaction the result of which is that any “person” (as defined in Section 13(d)(3) of the Exchange Act), or group
of persons, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 of the Exchange Act) of a majority of total voting power of the voting shares of the Company.
The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against
the transfer of the undersigned’s securities subject to this Lock-Up Letter Agreement except in compliance with this Lock-Up Letter Agreement.
If the undersigned is an officer or director of the Company, (i) the undersigned agrees that the foregoing restrictions shall be equally
applicable to any Offered Securities that the undersigned may purchase in the Offering; (ii) the Representative agrees that, at least three (3) business days before the effective date of any release or waiver of the foregoing restrictions in
connection with a transfer of securities subject to this Lock-Up Letter Agreement, the Representative will notify the Company of the impending release or waiver; and (iii) the Company has agreed in the Underwriting Agreement to announce the impending
release or waiver by press release through a major news service at least two (2) business days before the effective date of the release or waiver. Any release or waiver granted by the Representative hereunder to any such officer or director shall
only be effective two (2) business days after the publication date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer of securities subject to this Lock-Up
Letter Agreement not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described in this securities subject to this Lock-Up Letter Agreement to the extent and for the duration that such terms remain in
effect at the time of such transfer.
It is understood that, if the Company notifies the Underwriters that it does not intend to proceed with the Offering, if the Underwriting
Agreement does not become effective, or if the Underwriting Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the securities, the undersigned will be released
from its obligations under this Lock-Up Letter Agreement.
The undersigned understands that the Company and the Underwriters will proceed with the Offering in reliance on this Lock-Up Letter
Agreement.
This Lock-Up Letter Agreement shall automatically terminate upon the earliest to occur, if any, of (1) the termination of the Underwriting
Agreement before the sale of any securities to the Underwriters or (2) the termination of the Offering.
The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Lock-Up Letter
Agreement and that, upon request, the undersigned will execute any additional documents necessary in connection with the enforcement hereof. Any obligations of the undersigned shall be binding upon the heirs, personal representative, successors and
assigns of the undersigned.
[Signature page follows]
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Very truly yours,
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By:
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Name:
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Title:
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________________________
(Name - Please Print)
________________________
(Signature)
________________________
(Name of Signatory, in the case of entities - Please Print)
________________________
(Title of Signatory, in the case of entities - Please Print)
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Address:
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EXHIBIT C
Form of Press Release
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[Date]
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Pyxis Tankers Inc., a corporation formed under the laws of the Republic of the ▇▇▇▇▇▇▇▇ Islands (the “Company”), announced today that ThinkEquity, a division of Fordham Financial Management, Inc., acting as representative for the
underwriters in the Company’s recent public offering of the Company’s common shares, is [waiving] [releasing] a lock-up restriction with respect to _________ the Company’s common shares held by [certain officers, directors or other security
holders] [an officer, director or security holder] of the Company. The [waiver] [release] will take effect on _________, 20___, and the shares may be sold on or after such date.
This press release is not an offer or sale of the securities in the United States or in any other jurisdiction where such
offer or sale is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act of 1933, as amended.