AT THE MARKET OFFERING AGREEMENT February 2, 2021
Exhibit 1.1
February 2,
2021
▇.▇.
▇▇▇▇▇▇▇▇▇▇ & Co., LLC
▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies
and Gentlemen:
Solitario Zinc
Corp., a corporation organized under the laws of the State of
Colorado (the “Company”), confirms its
agreement (this “Agreement”) with ▇.▇.
▇▇▇▇▇▇▇▇▇▇ & Co., LLC (the “Manager”) as
follows:
1. Definitions. The terms that
follow, when used in this Agreement and any Terms Agreement, shall
have the meanings indicated.
“Accountants” shall have
the meaning ascribed to such term in Section 4(m).
“Act” shall mean the
Securities Act of 1933, as amended, and the rules and regulations
of the Commission promulgated thereunder.
“Action” shall have the
meaning ascribed to such term in Section 3(q).
“Affiliate” shall have the
meaning ascribed to such term in Section 3(p).
“Applicable Time” shall
mean, with respect to any Shares, the time of sale of such Shares
pursuant to this Agreement or any relevant Terms
Agreement.
“Base Prospectus” shall
mean the base prospectus contained in the Registration Statement at
the Execution Time.
“Board” shall have the
meaning ascribed to such term in Section 2(b)(iii).
“Broker Fee” shall have
the meaning ascribed to such term in Section 2(b)(v).
“Business
Day” shall mean any day other than Saturday, Sunday or
other day on which commercial banks in The City of New York are
authorized or required by law to remain closed; provided, however, that, for purposes of
clarity, commercial banks shall not be deemed to be authorized or
required by law to remain closed due to “stay at home”,
“shelter-in-place”, “non-essential
employee” or any other similar orders or restrictions
or the closure of any physical branch locations at the direction of
any governmental authority so long as the electronic funds transfer
systems (including for wire transfers) of commercial banks in The
City of New York generally are open for use by customers on such
day.
“Commission” shall mean
the United States Securities and Exchange Commission.
“Common Stock” shall have
the meaning ascribed to such term in Section 2.
“Common Stock Equivalents”
shall have the meaning ascribed to such term in Section
3(g).
“Company Counsel” shall
have the meaning ascribed to such term in Section
4(l).
“DTC” shall have the
meaning ascribed to such term in Section 2(b)(vii).
“Effective Date” shall
mean each date and time that the Registration Statement and any
post-effective amendment or amendments thereto became or becomes
effective.
“Exchange Act” shall mean
the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.
“Execution Time” shall
mean the date and time that this Agreement is executed and
delivered by the parties hereto.
“Filing Date” shall have
the meaning ascribed to such term in Section 4(w).
“Free Writing Prospectus”
shall mean a free writing prospectus, as defined in
Rule 405.
“GAAP” shall have the
meaning ascribed to such term in Section 3(n).
“Incorporated Documents”
shall mean the documents or portions thereof filed with the
Commission on or prior to the Effective Date that are incorporated
by reference in the Registration Statement or the Prospectus and
any documents or portions thereof filed with the Commission after
the Effective Date that are deemed to be incorporated by reference
in the Registration Statement or the Prospectus.
“Intellectual Property
Rights” shall have
the meaning ascribed to such term in Section 3(v).
“Issuer Free Writing
Prospectus” shall mean an issuer free writing
prospectus, as defined in Rule 433.
“Losses” shall have the
meaning ascribed to such term in Section 7(d).
“Material Adverse Effect”
shall have the meaning ascribed to such term in Section
3(b).
“Material Permits” shall
have the meaning ascribed to such term in Section
3(t).
“Net Proceeds” shall have
the meaning ascribed to such term in Section 2(b)(v).
“Permitted Free Writing
Prospectus” shall have the meaning ascribed to such
term in Section 4(g).
“Placement” shall have the
meaning ascribed to such term in Section 2(c).
“Proceeding” shall have
the meaning ascribed to such term in Section 3(b).
“Prospectus” shall mean
the Base Prospectus, as supplemented by the most recently filed
Prospectus Supplement.
“Prospectus Supplement”
shall mean each prospectus supplement relating to the Shares
prepared and filed pursuant to Rule 424(b) from time to
time.
“Registration Statement”
shall mean the shelf registration statement (File No. 333-249129)
on Form S-3, including exhibits and financial statements and
any prospectus supplement relating to the Shares that is filed with
the Commission pursuant to Rule 424(b) and deemed part of such
registration statement pursuant to Rule 430B, as amended on
each Effective Date and, in the event any post-effective amendment
thereto becomes effective, shall also mean such registration
statement as so amended.
“Representation Date”
shall have the meaning ascribed to such term in Section
4(k).
“Required Approvals” shall
have the meaning ascribed to such term in Section
3(e).
“Rule 158”,
“Rule 164”,
“Rule 172”,
“Rule 173”,
“Rule 405”,
“Rule 415”,
“Rule 424”,
“Rule 430B” and
“Rule 433” refer to
such rules under the Act.
“Sales Notice” shall have
the meaning ascribed to such term in Section 2(b)(i).
“SEC Reports” shall have
the meaning ascribed to such term in Section 3(m).
“Settlement Date” shall
have the meaning ascribed to such term in Section
2(b)(vii).
“Subsidiary” shall have
the meaning ascribed to such term in Section 3(a).
“Terms Agreement” shall
have the meaning ascribed to such term in Section
2(a).
“Time of Delivery” shall
have the meaning ascribed to such term in Section
2(c).
“Trading Day” means a day
on which the Trading Market is open for trading.
“Trading Market” means
NYSE American.
2. Sale and Delivery of Shares.
The Company proposes to issue and sell through or to the Manager,
as sales agent and/or principal, from time to time during the term
of this Agreement and on the terms set forth herein, up to
$9,000,000 of shares (the “Shares”) of the
Company’s common stock, $0.01 par value per share
(“Common
Stock”); provided, however, that in no event shall the Company
issue or sell through the Manager such number of Shares that
exceeds (a) the number or dollar amount of shares of Common Stock
registered on the Registration Statement, pursuant to which the
offering is being made, (b) the number of authorized but unissued
shares of Common Stock (less the number of shares of Common Stock
issuable upon exercise, conversion or exchange of any outstanding
securities of the Company or otherwise reserved from the
Company’s authorized capital stock) or (c) the dollar amount
of shares of Common Stock that would cause the Company or the
offering of the Shares to not satisfy the eligibility and
transaction requirements for use of Form S-3 (including, if
applicable, General Instruction I.B.6 of Registration Statement on
Form S-3) (the lesser of (a), (b) and (c), the “Maximum Amount”)).
Notwithstanding anything to the contrary contained herein, the
parties hereto agree that compliance with the limitations set forth
in this Section 2 on the number and aggregate sales price of Shares
issued and sold under this Agreement shall be the sole
responsibility of the Company and that the Manager shall have no
obligation in connection with such compliance.
(a) Appointment of Manager as Selling
Agent; Terms Agreement. For purposes of selling the Shares
through the Manager, the Company hereby appoints the Manager as
exclusive agent of the Company for the purpose of selling the
Shares of the Company pursuant to this Agreement and the Manager
agrees to use its commercially reasonable efforts to sell the
Shares on the terms and subject to the conditions stated herein.
The Company agrees that, whenever it determines to sell the Shares
directly to the Manager as principal, it will enter into a separate
agreement (each, a “Terms Agreement”) in
substantially the form of Annex I hereto, relating to
such sale in accordance with Section 2 of this
Agreement.
(b) Agent Sales. Subject to the
terms and conditions and in reliance upon the representations and
warranties herein set forth, the Company will issue and agrees to
sell Shares from time to time through the Manager, acting as sales
agent, and the Manager agrees to use its commercially reasonable
efforts to sell, as sales agent for the Company, on the following
terms:
(i) The Shares are to
be sold on a daily basis or otherwise as shall be agreed to by the
Company and the Manager on any day that (A) is a Trading Day,
(B) the Company has instructed the Manager by telephone
(confirmed promptly by electronic mail) to make such sales
(“Sales
Notice”) and (C) the Company has satisfied its
obligations under Section 6 of this Agreement. The Company will
designate the maximum amount of the Shares to be sold by the
Manager daily (subject to the limitations set forth in Section
2(d)) and the minimum price per Share at which such Shares may be
sold. Subject to the terms and conditions hereof, the Manager shall
use its commercially reasonable efforts to sell on a particular day
all of the Shares designated for the sale by the Company on such
day. The gross sales price of the Shares sold under this
Section 2(b) shall be the market price for the shares of
Common Stock sold by the Manager under this Section 2(b) on
the Trading Market at the time of sale of such Shares.
(ii) The
Company acknowledges and agrees that (A) there can be no
assurance that the Manager will be successful in selling the
Shares, (B) the Manager will incur no liability or obligation
to the Company or any other person or entity if it does not sell
the Shares for any reason other than a failure by the Manager to
use its commercially reasonable efforts consistent with its normal
trading and sales practices and applicable law and regulations to
sell such Shares as required under this Agreement, and (C) the
Manager shall be under no obligation to purchase Shares on a
principal basis pursuant to this Agreement, except as otherwise
specifically agreed by the Manager and the Company pursuant to a
Terms Agreement.
(iii) The
Company shall not authorize the issuance and sale of, and the
Manager shall not be obligated to use its commercially reasonable
efforts to sell, any Share at a price lower than the minimum price
therefor designated from time to time by the Company’s Board
of Directors (the “Board”), or a duly
authorized committee thereof, or such duly authorized officers of
the Company, and notified to the Manager in writing. The Company or
the Manager may, upon notice to the other party hereto by telephone
(confirmed promptly by electronic mail), suspend the offering of
the Shares for any reason and at any time; provided, however, that such suspension
or termination shall not affect or impair the parties’
respective obligations with respect to the Shares sold hereunder
prior to the giving of such notice.
(iv) The
Manager may sell Shares by any method permitted by law deemed to be
an “at the market offering” as defined in Rule 415
under the Act, including without limitation sales made directly on
the Trading Market, on any other existing trading market for the
Common Stock or to or through a market maker. The Manager may also
sell Shares in privately negotiated transactions, provided that the
Manager receives the Company’s prior written approval for any
sales in privately negotiated transactions and if so provided in
the “Plan of Distribution” section of the Prospectus
Supplement or a new Prospectus Supplement disclosing the terms of
such privately negotiated transaction
(v) The compensation to
the Manager for sales of the Shares under this Section 2(b) shall
be a placement fee of 3% of the gross sales price of the Shares
sold pursuant to this Section 2(b) (“Broker Fee”). The
foregoing rate of compensation shall not apply when the Manager
acts as principal, in which case the Company may sell Shares to the
Manager as principal at a price agreed upon at the relevant
Applicable Time pursuant to a Terms Agreement. The remaining
proceeds, after deduction of the Broker Fee and deduction of any
transaction fees imposed by any clearing firm, execution broker, or
governmental or self-regulatory organization, including, without
limitation, any fees for settlement, delivery or processing, in
respect of such sales, shall constitute the net proceeds to the
Company for such Shares (the “Net
Proceeds”).
(vi) The
Manager shall provide written confirmation (which may be by
facsimile or electronic mail) to the Company following the close of
trading on the Trading Market each day in which the Shares are sold
under this Section 2(b) setting forth the number of the Shares sold
on such day, the aggregate gross sales proceeds and the Net
Proceeds to the Company, and the compensation payable by the
Company to the Manager with respect to such sales.
(vii) Unless
otherwise agreed between the Company and the Manager, settlement
for sales of the Shares will occur at 10:00 a.m. (New York City
time) on the second (2nd) Trading Day (or such earlier day as is
industry practice for regular-way trading) following the date on
which such sales are made (each, a “Settlement Date”). On or
before the Trading Day prior to each Settlement Date, the Company
will, or will cause its transfer agent to, electronically transfer
the Shares being sold by crediting the Manager’s or its
designee’s account (provided that the Manager shall have
given the Company written notice of such designee at least one
Trading Day prior to the Settlement Date) at The Depository Trust
Company (“DTC”) through its Deposit
and Withdrawal at Custodian System or by such other means of
delivery as may be mutually agreed upon by the parties hereto which
Shares in all cases shall be freely tradable, transferable, and
registered shares in good deliverable form. On each Settlement
Date, the Manager will deliver the related Net Proceeds in same day
funds to an account designated by the Company. The Company agrees
that, if the Company, or its transfer agent (if applicable),
defaults in its obligation to deliver duly authorized Shares on a
Settlement Date, in addition to and in no way limiting the rights
and obligations set forth in Section 7 hereto, the Company will (i)
hold the Manager harmless against any loss, claim, damage, or
reasonable, documented expense (including reasonable and documented
legal fees and expenses), as incurred, arising out of or in
connection with such default by the Company, and (ii) pay to the
Manager any commission, discount or other compensation to which the
Manager would otherwise have been entitled absent such
default.
(viii) At
each Applicable Time, Settlement Date, Representation Date and
Filing Date, the Company shall be deemed to have affirmed each
representation and warranty contained in this Agreement as if such
representation and warranty were made as of such date, modified as
necessary to relate to the Registration Statement and the
Prospectus as amended as of such date. Any obligation of the
Manager to use its commercially reasonable efforts to sell the
Shares on behalf of the Company shall be subject to the continuing
accuracy of the representations and warranties of the Company
herein, to the performance by the Company of its obligations
hereunder and to the continuing satisfaction of the additional
conditions specified in Section 6 of this Agreement.
(ix) If
the Company shall declare or make any dividend or other
distribution of its assets (or rights to acquire its assets) to
holders of shares of Common Stock, by way of return of capital or
otherwise (including, without limitation, any distribution of cash,
stock or other securities, property or options by way of a
dividend, spin off, reclassification, corporate rearrangement,
scheme of arrangement or other similar transaction) (a
“Distribution” and the
record date for the determination of shareholders entitled to
receive the Distribution, the “Record Date”), the
Company hereby covenants that, in connection with any sales of
Shares pursuant to a Sales Notice on the Record Date, the Company
covenants and agrees that the Company shall issue and deliver such
Shares to the Manager on the Record Date and the Record Date shall
be the Settlement Date and the Company shall cover any additional
out-of-pocket costs of the Manager in connection with the delivery
of Shares on the Record Date.
(c) Term Sales. If the Company
wishes to sell the Shares pursuant to this Agreement but other than
as set forth in Section 2(b) of this Agreement (each, a
“Placement”), the Company
will notify the Manager of the proposed terms of such Placement. If
the Manager, acting as principal, wishes to accept such proposed
terms (which it may decline to do for any reason in its sole
discretion) or, following discussions with the Company wishes to
accept amended terms, the Manager and the Company will enter into a
Terms Agreement setting forth the terms of such Placement. The
terms set forth in a Terms Agreement will not be binding on the
Company or the Manager unless and until the Company and the Manager
have each executed such Terms Agreement accepting all of the terms
of such Terms Agreement. In the event of a conflict between the
terms of this Agreement and the terms of a Terms Agreement, the
terms of such Terms Agreement will control. A Terms Agreement may
also specify certain provisions relating to the reoffering of such
Shares by the Manager, including any restrictions in respect of
reoffering such Shares in Canada, whether through the Toronto Stock
Exchange, any other trading markets in Canada or otherwise. The
commitment of the Manager to purchase the Shares pursuant to any
Terms Agreement shall be deemed to have been made on the basis of
the representations and warranties of the Company herein contained
and shall be subject to the terms and conditions herein set forth.
Each Terms Agreement shall specify the number of the Shares to be
purchased by the Manager pursuant thereto, the price to be paid to
the Company for such Shares, any provisions relating to rights of,
and default by, underwriters acting together with the Manager in
the reoffering of the Shares, and the time and date (each such time
and date being referred to herein as a “Time of Delivery”) and
place of delivery of and payment for such Shares. Such Terms
Agreement shall also specify any requirements for opinions of
counsel, accountants’ letters and officers’
certificates pursuant to Section 6 of this Agreement and any other
information or documents required by the Manager.
(d) Maximum Number of Shares. Under
no circumstances shall the Company cause or request the offer or
sale of any Shares if, after giving effect to the sale of such
Shares, the aggregate amount of Shares sold pursuant to this
Agreement would exceed the lesser of (A) together with all sales of
Shares under this Agreement, the Maximum Amount, (B) the amount
available for offer and sale under the currently effective
Registration Statement and (C) the amount authorized from time to
time to be issued and sold under this Agreement by the Board, a
duly authorized committee thereof or a duly authorized executive
committee, and notified to the Manager in writing. Under no
circumstances shall the Company cause or request the offer or sale
of any Shares pursuant to this Agreement at a price lower than the
minimum price authorized from time to time by the Board, a duly
authorized committee thereof or a duly authorized executive
officer, and notified to the Manager in writing. Further, under no
circumstances shall the Company cause or permit the aggregate
offering amount of Shares sold pursuant to this Agreement to exceed
the Maximum Amount.
(e) Regulation M Notice. Unless the
exceptive provisions set forth in Rule 101(c)(1) of
Regulation M under the Exchange Act are satisfied with respect
to the Shares, the Company shall give the Manager at least one
Business Day’s prior notice of its intent to sell any Shares
in order to allow the Manager time to comply with Regulation
M.
(f) Restrictions on Sales in
Canada. The Manager acknowledges that the Shares have not
been registered or qualified for distribution in any Province or
Territory of Canada, and are not eligible for resale in Canada for
a period ending four (4) months plus one day from the Settlement
Date relating to the issuance of such Shares. The Manager agrees
that it will not sell, offer to sell or solicit offers to purchase
Shares in Canada, including through the Toronto Stock Exchange or
any other trading markets in Canada, or to or from persons resident
in any Province or Territory of Canada or to or from any person
acquiring such Shares for the benefit of another person resident in
any Province or Territory of Canada The Manager shall not sell,
offer to sell or solicit offers to purchase Shares so as to require
registration thereof or the filing of a prospectus or similar
document with respect thereto under the laws of any jurisdiction
other than the United States.
3. Representations and Warranties.
The Company represents and warrants to, and agrees with, the
Manager at the Execution Time and on each such time the following
representations and warranties are repeated or deemed to be made
pursuant to this Agreement, as set forth below or in the
Registration Statement, the Prospectus or the Incorporated
Documents.
(a) Subsidiaries.
All of the direct and indirect subsidiaries (individually, a
“Subsidiary”)
of the Company are set forth on Exhibit 21.1 to the Company’s
most recent Annual Report on Form 10-K filed with the Commission.
The Company owns, directly or indirectly, all of the capital stock
or other equity interests of each Subsidiary free and clear of any
“Liens”
(which for purposes of this Agreement shall mean a lien, charge,
security interest, encumbrance, right of first refusal, preemptive
right or other restriction), and all the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and
are fully paid, non-assessable and free of preemptive and similar
rights to subscribe for or purchase securities.
(b) Organization and
Qualification. The Company and
each of the Subsidiaries is an entity duly incorporated or
otherwise organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization
(as applicable), with the requisite power and authority to own and
use its properties and assets and to carry on its business as
currently conducted. Neither the Company nor any Subsidiary is in
violation or default of any of the provisions of its respective
certificate or articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and the
Subsidiaries is duly qualified to conduct business and is in good
standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the
case may be, could not reasonably be expected to result in (i) a
material adverse effect on the legality, validity or enforceability
of this Agreement, (ii) a material adverse change in the results of
operations, assets, business, prospects or condition (financial or
otherwise) of the Company and the Subsidiaries, taken as a whole,
from that set forth in the Registration Statement, the Base
Prospectus, any Prospectus Supplement, the Prospectus or the
Incorporated Documents, or (iii) a material adverse effect on the
Company’s ability to perform in any material respect on a
timely basis its obligations under this Agreement (any of (i), (ii)
or (iii), a “Material Adverse
Effect”) and no
“Proceeding”
(which for purposes of this Agreement shall mean any action, claim,
suit, investigation or proceeding (including, without limitation,
an informal investigation or partial proceeding, such as a
deposition), whether commenced or threatened) has been instituted
in any such jurisdiction revoking, limiting or curtailing or
seeking to revoke, limit or curtail such power and authority or
qualification.
(c) Authorization and
Enforcement. The Company has
the requisite corporate power and authority to enter into and to
consummate the transactions contemplated by this Agreement and
otherwise to carry out its obligations hereunder. The execution and
delivery of this Agreement by the Company and the consummation by
it of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of the Company and
no further action is required by the Company, the Board or its
stockholders in connection herewith other than in connection with
the Required Approvals. This Agreement has been duly executed and
delivered by the Company and constitutes the valid and binding
obligation of the Company enforceable against the Company in
accordance with its terms except (i) as limited by general
equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and
(iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
(d) No
Conflicts. The execution,
delivery and performance of this Agreement by the Company, the
issuance and sale of the Shares and the consummation by the Company
of the other transactions contemplated herein do not and will not
(i) conflict with or violate any provision of the Company’s
or any Subsidiary’s certificate or articles of incorporation,
bylaws or other organizational or charter documents, or (ii)
conflict with, or constitute a default (or an event that with
notice or lapse of time or both would become a default) under,
result in the creation of any Lien upon any of the properties or
assets of the Company or any Subsidiary, or give to others any
rights of termination, amendment, anti-dilution or similar
adjustments, acceleration or cancellation (with or without notice,
lapse of time or both) of, any agreement, credit facility, debt or
other instrument (evidencing a Company or Subsidiary debt or
otherwise) or other understanding to which the Company or any
Subsidiary is a party or by which any property or asset of the
Company or any Subsidiary is bound or affected, or (iii) subject to
the Required Approvals, conflict with or result in a violation of
any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which
the Company or a Subsidiary is subject (including federal and state
securities laws and regulations), or by which any property or asset
of the Company or a Subsidiary is bound or affected, except in the
case of each of clauses (ii) and (iii), such as could not
reasonably be expected to result in a Material Adverse
Effect.
(e) Filings, Consents and
Approvals. The Company is not
required to obtain any consent, waiver, authorization or order of,
give any notice to, or make any filing or registration with, any
court or other federal, state, local or other governmental
authority or other “Person” (defined as an individual
or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock
company, government (or an agency or subdivision thereof) or other
entity of any kind, including the Trading Market) in connection
with the execution, delivery and performance by the Company of this
Agreement, other than (i) the filings required by this Agreement,
(ii) the filing with the Commission of the Prospectus Supplement,
(iii) the filing of application(s) to and approval by the Trading
Market for the listing of the Shares for trading thereon in the
time and manner required thereby, and (iv) such filings as are
required to be made under applicable state securities laws and the
rules and regulations of the Financial Industry Regulatory
Authority, Inc. (“FINRA”)
(collectively, the “Required
Approvals”).
(f) Issuance of
Shares. The Shares are duly
authorized and, when issued and paid for in accordance with this
Agreement, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by the Company.
The Company has reserved from its duly authorized capital stock a
sufficient number of shares of Common Stock issuable pursuant to
this Agreement. The issuance by the Company of the Shares has been
registered under the Act and all of the Shares are freely
transferable and tradable by the purchasers thereof without
restriction (other than any restrictions arising solely from an act
or omission of such a purchaser or any purchaser that is an
Affiliate of the Company). The Shares are being issued pursuant to
the Registration Statement and the issuance of the Shares has been
registered by the Company under the Act. The
“Plan of
Distribution” section
within the Registration Statement permits the issuance and sale of
the Shares as contemplated by this Agreement. Upon receipt of the
Shares, the purchasers of such Shares will have good and marketable
title to such Shares and the Shares will be freely tradable on the
Trading Market.
(g) Capitalization.
The capitalization of the Company is as set forth in the
Registration Statement, the Base Prospectus, the Prospectus
Supplement and the Prospectus. The Company has not issued any
capital stock since its most recently filed periodic report under
the Exchange Act, other than pursuant to the exercise of employee
stock options under the Company’s stock option plans, the
issuance of shares of Common Stock to employees pursuant to the
Company’s employee stock purchase plan and pursuant to the
conversion or exercise of securities exercisable, exchangeable or
convertible into Common Stock (“Common Stock
Equivalents”). No Person
has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the
transactions contemplated by this Agreement. Except (i) pursuant to
the Company’s stock option plan and (ii) pursuant to
agreements or instruments filed as exhibits to Incorporated
Documents, there are no outstanding options, warrants, script
rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations
convertible into or exercisable or exchangeable for, or giving any
Person any right to subscribe for or acquire, any shares of Common
Stock, or contracts, commitments, understandings or arrangements by
which the Company or any Subsidiary is or may become bound to issue
additional shares of Common Stock or Common Stock Equivalents. The
issuance and sale of the Shares will not obligate the Company to
issue shares of Common Stock or other securities to any Person.
There are no outstanding securities or instruments of the Company
or any Subsidiary with any provision that adjusts the exercise,
conversion, exchange or reset price of such security or instrument
upon an issuance of securities by the Company or any Subsidiary.
All of the outstanding shares of capital stock of the Company are
validly issued, fully paid and nonassessable, have been issued in
compliance with all federal and state securities laws, and none of
such outstanding shares was issued in violation of any preemptive
rights or similar rights to subscribe for or purchase securities.
There are no stockholders agreements, voting agreements or other
similar agreements with respect to the Company’s capital
stock to which the Company is a party or, to the knowledge of the
Company, between or among any of the Company’s
stockholders.
(h) Registration Statement. The
Company meets the requirements for use of Form S-3 under the
Act and has prepared and filed with the Commission the Registration
Statement, including a related Base Prospectus, for registration
under the Act of the offering and sale of the Shares. Such
Registration Statement is effective and available for the offer and
sale of the Shares as of the date hereof. As filed, the Base
Prospectus contains all information required by the Act and the
rules thereunder, and, except to the extent the Manager shall agree
in writing to a modification, shall be in all substantive respects
in the form furnished to the Manager prior to the Execution Time or
prior to any such time this representation is repeated or deemed to
be made. The Registration Statement, at the Execution Time, each
such time this representation is repeated or deemed to be made, and
at all times during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with
Rule 172, 173 or any similar rule) in connection with any
offer or sale of the Shares, meets the requirements set forth in
Rule 415(a)(1)(x). The initial Effective Date of the
Registration Statement was not earlier than the date three years
before the Execution Time. The Company meets the transaction
requirements with respect to the aggregate market value of
securities being sold pursuant to this offering and during the
twelve (12) months prior to this offering, as set forth in General
Instruction I.B.6 of Form S-3.
(i) Accuracy of
Incorporated Documents. The
Incorporated Documents, when they were filed with the Commission,
conformed in all material respects to the requirements of the
Exchange Act and the rules thereunder, and none of the Incorporated
Documents, when they were filed with the Commission, contained any
untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made not misleading; and any
further documents so filed and incorporated by reference in the
Registration Statement, the Base Prospectus, the Prospectus
Supplement or the Prospectus, when such documents are filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act and the rules thereunder, as
applicable, and will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading.
(j) Ineligible Issuer. (i) At
the earliest time after the filing of the Registration Statement
that the Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2)) of the Shares and
(ii) as of the Execution Time and on each such time this
representation is repeated or deemed to be made (with such date
being used as the determination date for purposes of this
clause (ii)), the Company was not and is not an Ineligible
Issuer (as defined in Rule 405), without 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.
(k) Free Writing Prospectus. The
Company is eligible to use Issuer Free Writing Prospectuses. Each
Issuer Free Writing Prospectus does not include any information the
substance of which conflicts with the information contained in the
Registration Statement, including any Incorporated Documents and
any prospectus supplement deemed to be a part thereof that has not
been superseded or modified; and each Issuer Free Writing
Prospectus does not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading. The foregoing sentence does not
apply to statements in or omissions from any Issuer Free Writing
Prospectus based upon and in conformity with written information
furnished to the Company by the Manager specifically for use
therein. Any Issuer Free
Writing Prospectus that the Company is
required to file pursuant to Rule 433(d) has been, or will be,
filed with the Commission in accordance with the requirements of
the Act and the rules thereunder. Each Issuer Free Writing
Prospectus that the Company has filed,
or is required to file, pursuant to Rule 433(d) or that was
prepared by or behalf of or used by the Company complies or will
comply in all material respects with the requirements of the Act
and the rules thereunder. The Company will not, without the prior
consent of the Manager, prepare, use or refer to, any Issuer Free
Writing Prospectuses for any Shares, provided that the Company may
prepare, use or refer to any Issuer Free Writing Prospectuses for
any other purpose without the consent of the Manager that does not
reference, pertain to, or otherwise reduce the Shares subject to
this Agreement.
(l) Proceedings Related to Registration
Statement. The Registration Statement is not the subject of
a pending proceeding or examination under Section 8(d) or 8(e)
of the Act, and the Company is not the subject of a pending
proceeding under Section 8A of the Act in connection with the
offering of the Shares. The Company
has not received any notice that the Commission has issued or
intends to issue a stop-order with respect to the Registration
Statement or that the Commission otherwise has suspended or
withdrawn the effectiveness of the Registration Statement, either
temporarily or permanently, or intends or has threatened in writing
to do so.
(m) SEC
Reports. The Company has
complied in all material respects with requirements to file all
reports, schedules, forms, statements and other documents required
to be filed by it under the Act and the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the two years
preceding the date hereof (or such shorter period as the Company
was required by law to file such material) (the foregoing
materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to
herein as the “SEC
Reports”) on a timely
basis or has received a valid extension of such time of filing and
has filed any such SEC Reports prior to the expiration of any such
extension.
(n) Financial Statements. The
consolidated financial statements incorporated by reference in the
Registration Statement, the Prospectus or the Incorporated
Documents and any amendments thereof or supplements thereto
comply in all material respects with
applicable accounting requirements and the rules and regulations of
the Commission with respect thereto as in effect at the time of
filing or as amended or corrected in a subsequent filing. Such
financial statements have been prepared in accordance with United
States generally accepted accounting principles applied on a
consistent basis during the periods involved
(“GAAP”),
except as may be otherwise specified in such financial statements
or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present
in all material respects the financial position of the Company and
its consolidated subsidiaries as of and for the dates thereof and
the results of operations and cash flows for the periods then
ended, subject, in the case of unaudited statements, to normal,
immaterial, year-end audit adjustments.
(o) Accountants. The Company’s accountants are ▇▇▇▇▇▇ &
▇▇▇▇▇, PLLC. To the knowledge of the Company, such accountants,
which the Company expects would be able to express their opinion
with respect to the financial statements to be included in the
Company’s next Annual Report on Form 10-K, are a registered
public accounting firm as required by the Act.
(p) Material Adverse
Events. Since the date of the
latest audited financial statements included within the SEC
Reports, except as specifically disclosed in a subsequent SEC
Report filed prior to the date hereof, (i) there has been no event,
occurrence or development that has had or that could reasonably be
expected to result in a Material Adverse Effect, (ii) the Company
has not incurred any liabilities (contingent or otherwise) other
than (A) trade payables and accrued expenses incurred in the
ordinary course of business consistent with past practice and (B)
liabilities not required to be reflected in the Company’s
financial statements pursuant to GAAP or required to be disclosed
in filings made with the Commission, (iii) the Company has not
altered its method of accounting, (iv) the Company has not declared
or made any dividend or distribution of cash or other property to
its stockholders or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock and (v) the
Company has not issued any equity securities to any officer,
director or “Affiliate”
(defined as any Person that, directly or indirectly through one or
more intermediaries, controls or is controlled by or is under
common control with a Person, as such terms are used in and
construed under Rule 144 under the Act), except pursuant to
existing Company stock option plans. The Company does not have
pending before the Commission any request for confidential
treatment of information. No event, liability or development has
occurred or exists with respect to the Company or its Subsidiaries
or their respective business, properties, operations or financial
condition, that would be required to be disclosed by the Company
under applicable securities laws at the time this representation is
deemed made that has not been publicly disclosed at least 1 Trading
Day prior to the date that this representation is deemed
made.
(q) Litigation.
There is no action, suit, inquiry, notice of violation, Proceeding
or investigation pending or, to the knowledge of the Company,
threatened against or affecting the Company, any Subsidiary or any
of their respective properties before or by any court, arbitrator,
governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) (collectively, an
“Action”)
which (i) adversely affects or challenges the legality, validity or
enforceability of this Agreement or the Shares or (ii) could, if
there were an unfavorable decision, reasonably be expected to
result in a Material Adverse Effect. Neither the Company nor any
Subsidiary, nor, to the knowledge of the Company, any director or
officer thereof, is or has been the subject of any Action involving
a claim of violation of or liability under federal or state
securities laws or a claim of breach of fiduciary duty. There has
not been, and to the knowledge of the Company, there is not pending
or contemplated, any investigation by the Commission involving the
Company or any current or former director or officer of the
Company. The Commission has not issued any stop order or other
order suspending the effectiveness of any registration statement
filed by the Company or any Subsidiary under the Exchange Act or
the Act.
(r) Labor
Relations. No material labor
dispute exists or, to the knowledge of the Company, is imminent
with respect to any of the employees of the Company which could
reasonably be expected to result in a Material Adverse Effect. None
of the Company’s or its Subsidiaries’ employees is a
member of a union that relates to such employee’s
relationship with the Company, and neither the Company nor any of
its Subsidiaries is a party to a collective bargaining agreement,
and the Company and its Subsidiaries believe that their
relationships with their employees are good. No executive officer,
to the knowledge of the Company, is, or is now expected to be, in
violation of any material term of any employment contract,
confidentiality, disclosure or proprietary information agreement or
non-competition agreement, or any other contract or agreement or
any restrictive covenant, and the continued employment of each such
executive officer does not subject the Company or any of its
Subsidiaries to any liability with respect to any of the foregoing
matters. The Company and its Subsidiaries are in compliance with
all U.S. federal, state, local and foreign laws and regulations
relating to employment and employment practices, terms and
conditions of employment and wages and hours, except where the
failure to be in compliance could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
(s) No Existing
Defaults. Neither the Company
nor any Subsidiary (i) is in default under or in violation of (and
no event has occurred that has not been waived that, with notice or
lapse of time or both, would result in a default by the Company or
any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it
is in violation of, any indenture, loan or credit agreement or any
other agreement or instrument to which it is a party or by which it
or any of its properties is bound (whether or not such default or
violation has been waived), (ii) is in violation of any order of
any court, arbitrator or governmental body, or (iii) is or has been
in violation of any statute, rule or regulation of any governmental
authority, including without limitation all foreign, federal, state
and local laws relating to taxes, environmental protection,
occupational health and safety, product quality and safety and
employment and labor matters, except in each case as could not
reasonably be expected to result in a Material Adverse
Effect.
(t) Regulatory
Permits. The Company and the
Subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state, local or foreign
regulatory authorities necessary to conduct their respective
businesses as described in the Registration Statement, the Base
Prospectus, any Prospectus Supplement or the Prospectus, except
where the failure to possess such permits could not reasonably be
expected to result in a Material Adverse Effect
(“Material
Permits”), and neither
the Company nor any Subsidiary has received any notice of
proceedings relating to the revocation or modification of any
Material Permit.
(u) Title to
Assets. The Company and the
Subsidiaries have good and marketable title in fee simple to all
real property owned by them that is material to the business of the
Company and the Subsidiaries and good and marketable title in all
personal property owned by them that is material to the business of
the Company and the Subsidiaries, in each case free and clear of
all Liens, except for Liens as do not materially affect the value
of such property and do not materially interfere with the use made
and proposed to be made of such property by the Company and the
Subsidiaries and Liens for the payment of federal, state or other
taxes, the payment of which is neither delinquent nor subject to
penalties. Any real property and facilities held under lease by the
Company and the Subsidiaries are held by them under valid,
subsisting and enforceable leases of which the Company and the
Subsidiaries are in compliance, except where such non-compliance
would not reasonably be expected to have a Material Adverse
Effect.
(v) Intellectual
Property. The Company and the
Subsidiaries have, or have rights to use, all patents, patent
applications, trademarks, trademark applications, service marks,
trade names, trade secrets, inventions, copyrights, licenses and
other similar intellectual property rights necessary or material
for use in connection with their respective businesses as described
in the Registration Statement, the Base Prospectus, any Prospectus
Supplement or the Prospectus and which the failure to so have could
reasonably be expected to have a Material Adverse Effect
(collectively, the “Intellectual Property
Rights”). Neither the
Company nor any Subsidiary has received, since the date of the
latest audited financial statements included within the SEC
Reports, a notice (written or otherwise) that the Intellectual
Property Rights violate or infringe upon the rights of any Person,
except as would not have a Material Adverse Effect. To the
knowledge of the Company, all such Intellectual Property Rights are
enforceable (other than patent and trademark applications) and
there is no existing infringement by another Person of any of the
Intellectual Property Rights. The Company and its Subsidiaries have
taken reasonable security measures to protect the secrecy,
confidentiality and value of all of their Intellectual Property
Rights, except where failure to do so could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse
Effect.
(w) Insurance.
The Company and the Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks
and in such amounts as the Company determines to be prudent and
customary for companies of similar size as the Company in the
businesses in which the Company and the Subsidiaries are engaged.
To the knowledge of the Company, such insurance contracts and
policies are accurate and complete. Neither the Company nor any
Subsidiary has any reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant
increase in cost.
(x) Affiliate
Transactions. Except as set
forth in the Registration Statement, the Base Prospectus, any
Prospectus Supplement or the Prospectus, none of the officers or
directors of the Company and, to the knowledge of the Company, none
of the employees of the Company is presently a party to any
transaction with the Company or any Subsidiary (other than for
services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or
from any officer, director or such employee or, to the knowledge of
the Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director,
trustee or partner, in each case in excess of $120,000, other than
(i) for payment of salary or consulting fees for services rendered,
(ii) reimbursement for expenses incurred on behalf of the Company
and (iii) for other employee benefits, including stock option
agreements under any stock option plan of the
Company.
(y) Sarbanes Oxley
Compliance. Except as disclosed
in the Registration Statement, the Base Prospectus, any Prospectus
Supplement or the Prospectus, the Company is in material compliance
with all provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 which are
applicable to it as of the Effective Date. The Company and
the Subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii)
access to assets is permitted only in accordance with
management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences. The Company has established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) for the Company and designed such disclosure
controls and procedures to ensure that information required to be
disclosed by the Company in the reports it files or submits under
the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Commission’s rules
and forms. The Company’s certifying officers have evaluated
the effectiveness of the Company’s disclosure controls and
procedures as of the end of the period covered by the
Company’s most recently filed periodic report under the
Exchange Act (such date, the “Evaluation Date”). The
Company presented in its most recently filed periodic report under
the Exchange Act the conclusions of the certifying officers about
the effectiveness of the disclosure controls and procedures based
on their evaluations as of the Evaluation Date. Since the
Evaluation Date, there have been no changes in the Company’s
internal control over financial reporting (as such term is defined
in the Exchange Act) that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control
over financial reporting.
(z) Finder’s Fees. Other than
payments to be made to the Manager, no
brokerage or finder’s fees or commissions are or will be
payable by the Company to any broker, financial advisor or
consultant, finder, placement agent, investment banker, bank or
other Person with respect to the transactions contemplated by this
Agreement. The Manager shall have no obligation with respect to any
fees or with respect to any claims made by or on behalf of other
Persons for fees of a type contemplated in this Section that may be
due in connection with the transactions contemplated by this
Agreement.
(aa) No
Other Sales Agency Agreement. The Company has not entered
into any other sales agency agreements or other similar
arrangements with any agent or any other representative in respect
of at the market offerings of the Shares.
(bb) Regulation
M Compliance. The Company has
not, and to its knowledge no one acting on its behalf has, (i)
taken, directly or indirectly, any action designed to cause or to
result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of any of
the Shares, (ii) sold, bid for, purchased, or paid any compensation
for soliciting purchases of, any of the Shares or (iii) paid or
agreed to pay to any person any compensation for soliciting another
to purchase any other securities of the Company, other than, in the
case of clauses (ii) and (iii), compensation paid to the Manager in
connection with the placement of the Shares.
(cc) Listing
and Maintenance Requirements.
Subject to the submission and approval of an additional listing
application with the Trading Market, the issuance and sale of the
Shares as contemplated in this Agreement does not contravene the
rules and regulations of the Trading Market. The Common Stock is registered pursuant to Section
12(b) or 12(g) of the Exchange Act, and the Company has taken no
action designed to, or which to its knowledge is likely to have the
effect of, terminating the registration of the Common Stock under
the Exchange Act nor has the Company received any notification that
the Commission is contemplating terminating such registration.
Except as disclosed in the Registration Statement, the Base
Prospectus, any Prospectus Supplement, the Prospectus or the
Incorporated Documents, the Company has not, in the 12 months
preceding the date hereof, received notice from any Trading Market
on which the Common Stock is or has been listed or quoted to the
effect that the Company is not in compliance with the listing or
maintenance requirements of such Trading
Market.
(dd) Application
of Takeover Protections. Except
as set forth in the Registration Statement, the Base Prospectus,
any Prospectus Supplement or the Prospectus, the Company and its
Board have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination,
poison pill (including any distribution under a rights agreement)
or other similar anti-takeover provision under the Company’s
Certificate of Incorporation (or similar charter documents) or the
laws of its state of incorporation that is or could become
applicable to the purchasers of the Shares.
(ee) Solvency.
Based on the financial condition of the Company as of the Effective
Date, (i) the Company’s fair saleable value of its assets
exceeds the amount that will be required to be paid on or in
respect of the Company’s existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the
Company’s assets do not constitute unreasonably small capital
to carry on its business as now conducted and as proposed to be
conducted including its capital needs taking into account the
particular capital requirements of the business conducted by the
Company, and projected capital requirements and capital
availability thereof, and (iii) the current cash flow of the
Company, together with the proceeds the Company would receive, were
it to liquidate all of its assets, after taking into account all
anticipated uses of the cash, would be sufficient to pay all
amounts on or in respect of its debt when such amounts are required
to be paid. Within one year of the Effective Date, the Company does
not intend to incur debts beyond its ability to pay such debts as
they mature (taking into account the timing and amounts of cash to
be payable on or in respect of its debt). The SEC Reports set forth
as of the dates thereof all outstanding secured and unsecured
Indebtedness of the Company or any Subsidiary, or for which the
Company or any Subsidiary has commitments. For the purposes of this
Agreement, “Indebtedness”
shall mean (a) any liabilities for borrowed money or amounts owed
in excess of $50,000 (other than accrued liabilities and trade
accounts payable incurred in the ordinary course of business), (b)
all guaranties, endorsements and other contingent obligations in
respect of indebtedness of others, whether or not the same are or
should be reflected in the Company’s balance sheet (or the
notes thereto), except guaranties by endorsement of negotiable
instruments for deposit or collection or similar transactions in
the ordinary course of business; and (c) the present value of any
lease payments in excess of
$50,000 due under leases required to be capitalized in accordance
with GAAP.
Neither the Company
nor any Subsidiary is in default with respect to any
Indebtedness.
(ff) Tax
Status. Except for matters that
would not, individually or in the aggregate, have or reasonably be
expected to result in a Material Adverse Effect, the Company and
each Subsidiary (i) have made
or filed all
necessary United States federal, and
state income and all
foreign income and franchise tax
returns and have paid or
accrued all taxes shown as due thereon, and the Company has no
knowledge of a tax deficiency which has been asserted or threatened
against the Company or any
report and declaration required by any jurisdiction to which it is
subject, (ii) have paid all taxes and other governmental
assessments and charges that are material in amount, shown or
determined to be due on such returns, reports and declarations and
(iii) have set aside on its books provision reasonably adequate for
the payment of all material taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There
are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the officers of the
Company or of any
Subsidiary know of no basis for
any such claim.
(gg) Foreign
Corrupt Practices. Neither the
Company, nor to the knowledge of the Company, any agent or other
person acting on behalf of the Company, has (i) directly or
indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or
domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any
foreign or domestic political parties or campaigns from corporate
funds, (iii) failed to disclose fully any contribution made by the
Company (or made by any person acting on its behalf of which the
Company is aware) which is in violation of law, or (iv) violated in
any material respect any provision of the Foreign Corrupt Practices
Act of 1977, as amended.
(hh) Office
of Foreign Assets Control. Neither the Company nor any
Subsidiary nor, to the Company's knowledge, any director, officer,
agent, employee or affiliate of the Company or any Subsidiary is
currently subject to any U.S. sanctions administered by the Office
of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”).
(ii) U.S.
Real Property Holding Corporation. The Company is not and
has never been a U.S. real property holding corporation within the
meaning of Section 897 of the Internal Revenue Code of 1986, as
amended, and the Company shall so certify upon the Manager’s
request.
(jj) Bank
Holding Company Act. Neither the Company nor any of its
Subsidiaries or Affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”) and to regulation
by the Board of Governors of the Federal Reserve System (the
“Federal
Reserve”). Neither the Company nor any of its
Subsidiaries or Affiliates owns or controls, directly or
indirectly, five percent (5%) or more of the outstanding shares of
any class of voting securities or twenty-five percent or more of
the total equity of a bank or any entity that is subject to the
BHCA and to regulation by the Federal Reserve. Neither the Company
nor any of its Subsidiaries or Affiliates exercises a controlling
influence over the management or policies of a bank or any entity
that is subject to the BHCA and to regulation by the Federal
Reserve.
(kk) Money
Laundering. The operations of the Company and its
Subsidiaries are and have been conducted at all times in compliance
with applicable financial record-keeping and reporting requirements
of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, applicable money laundering statutes and applicable rules
and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action or Proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company
or any Subsidiary with respect to the Money Laundering Laws is
pending or, to the knowledge of the Company or any Subsidiary,
threatened.
(ll) FINRA
Member Shareholders. There are
no affiliations with any FINRA member firm among the
Company’s officers, directors or, to the knowledge of the
Company, any five percent (5%) or greater stockholder of the
Company, except as set forth in the Registration Statement, the
Base Prospectus, any Prospectus Supplement or the
Prospectus.
4. Agreements. The Company agrees
with the Manager that:
(a) Right to Review Amendments and
Supplements to Registration Statement and Prospectus. During
any period when the delivery of a prospectus relating to the Shares
is required (including in circumstances where such requirement may
be satisfied pursuant to Rule 172, 173 or any similar rule) to
be delivered under the Act in connection with the offering or the
sale of Shares, the Company will not file any amendment to the
Registration Statement or supplement (including any Prospectus
Supplement) to the Base Prospectus unless the Company has furnished
to the Manager a copy for its review prior to filing and will not
file any such proposed amendment or supplement to which the Manager
reasonably objects (provided, however, that the Company will have
no obligation to provide the Manager any advance copy of such
filing or to provide the Manager an opportunity to object to such
filing if the filing does not name the Manager and does not relate
to the transactions herein provided). The Company has properly
completed the Prospectus, in a form approved by the Manager, and
filed such Prospectus, as amended at the Execution Time, with the
Commission pursuant to the applicable paragraph of Rule 424(b) by
the Execution Time and will cause any supplement to the Prospectus
to be properly completed, in a form approved by the Manager, and
will file such supplement with the Commission pursuant to the
applicable paragraph of Rule 424(b) within the time period
prescribed thereby and will provide evidence reasonably
satisfactory to the Manager of such timely filing. The Company will
promptly advise the Manager (i) when the Prospectus, and any
supplement thereto, shall have been filed (if required) with the
Commission pursuant to Rule 424(b), (ii) when, during any
period when the delivery of a prospectus (whether physically or
through compliance with Rule 172, 173 or any similar rule) is
required under the Act in connection with the offering or sale of
the Shares, any amendment to the Registration Statement shall have
been filed or become effective (other than any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange
Act), (iii) of any request by the Commission or its staff for
any amendment of the Registration Statement, or for any supplement
to the Prospectus or for any additional information, (iv) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any notice
objecting to its use or the institution or threatening of any
proceeding for that purpose and (v) of the receipt by the
Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the
institution or threatening of any proceeding for such purpose. The
Company will use commercially reasonable efforts to prevent the
issuance of any such stop order or the occurrence of any such
suspension or objection to the use of the Registration Statement
and, upon such issuance, occurrence or notice of objection, to
obtain as soon as possible the withdrawal of such stop order or
relief from such occurrence or objection, including, if necessary,
by filing an amendment to the Registration Statement or a new
registration statement and using commercially reasonable efforts to
have such amendment or new registration statement declared
effective as soon as practicable.
(b) Subsequent Events. If, at any
time on or after an Applicable Time but prior to the related
Settlement Date, any event occurs as a result of which the
Registration Statement or Prospectus would include any untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein in the light of the
circumstances under which they were made or the circumstances then
prevailing not misleading, the Company will (i) notify
promptly the Manager so that any use of the Registration Statement
or Prospectus may cease until such are amended or supplemented;
(ii) amend or supplement the Registration Statement or
Prospectus to correct such statement or omission; and
(iii) supply any amendment or supplement to the Manager in
such quantities as the Manager may reasonably request.
(c) Notification of Subsequent
Filings. During any period when the delivery of a prospectus
relating to the Shares is required (including in circumstances
where such requirement may be satisfied pursuant to Rule 172,
173 or any similar rule) to be delivered under the Act, any event
occurs as a result of which the Prospectus as then supplemented
would include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein in
the light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend the Registration
Statement, file a new registration statement or supplement the
Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, including in connection with use or
delivery of the Prospectus, the Company promptly will
(i) notify the Manager of any such event, (ii) subject to
Section 4(a), prepare and file with the Commission an amendment or
supplement or new registration statement which will correct such
statement or omission or effect such compliance, (iii) use
commercially reasonable efforts to have any amendment to the
Registration Statement or new registration statement declared
effective as soon as practicable in order to avoid any disruption
in use of the Prospectus and (iv) supply any supplemented
Prospectus to the Manager in such quantities as the Manager may
reasonably request.
(d) Earnings Statements. As soon as
practicable, the Company will make generally available to its
security holders and to the Manager an earnings statement or
statements of the Company and its Subsidiaries which will satisfy
the provisions of Section 11(a) of the Act and Rule 158.
The Company’s compliance with the reporting requirements of
the Exchange Act shall be deemed to satisfy the requirements of
this Section 4(d).
(e) Delivery of Registration
Statement. Upon the request of the Manager, the Company will
furnish to the Manager and counsel for the Manager, without charge,
signed copies of the Registration Statement (including exhibits
thereto) and, so long as delivery of a prospectus by the Manager or
dealer may be required by the Act (including in circumstances where
such requirement may be satisfied pursuant to Rule 172, 173 or
any similar rule), as many copies of the Prospectus and each Issuer
Free Writing Prospectus and any supplement thereto as the Manager
may reasonably request. The Company will pay the expenses of
printing or other production of all documents relating to the
offering.
(f) Qualification of Shares. The
Company will arrange, if necessary, for the qualification of the
Shares for sale under the laws of such jurisdictions in the United
States as the Manager may designate and will maintain such
qualifications in effect so long as required for the distribution
of the Shares; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action that would subject it to
service of process in suits, other than those arising out of the
offering or sale of the Shares, in any jurisdiction where it is not
now so subject.
(g) Free Writing Prospectus. The
Company agrees that, unless it has or shall have obtained the prior
written consent of the Manager, and the Manager agrees with the
Company that, unless it has or shall have obtained, as the case may
be, the prior written consent of the Company, it has not made and
will not make any offer relating to the Shares that would
constitute an Issuer Free Writing Prospectus or that would
otherwise constitute a “free writing prospectus” (as
defined in Rule 405) relating to the Shares required to be
filed by the Company with the Commission or retained by the Company
under Rule 433. Any such free writing prospectus consented to
by the Manager or the Company is hereinafter referred to as a
“Permitted Free
Writing Prospectus.” The Company agrees that
(i) it has treated and will treat, as the case may be, each
Permitted Free Writing Prospectus as an Issuer Free Writing
Prospectus and (ii) it has complied and will comply, as the
case may be, with the requirements of Rules 164 and 433
applicable to any Permitted Free Writing Prospectus, including in
respect of timely filing with the Commission, legending and record
keeping.
(h) Subsequent Equity Issuances.
Neither the Company nor any Subsidiary will offer, sell, issue,
contract to sell, contract to issue or otherwise dispose of,
directly or indirectly, any other shares of Common Stock or any
Common Stock Equivalents (other than the Shares) during the term of
this Agreement (i) without giving the Manager at least three
Business Days’ prior written notice specifying the nature of
the proposed transaction and the date of such proposed transaction
and (ii) unless the Manager suspends acting under this
Agreement for such period of time requested by the Company or as
deemed appropriate by the Manager in light of the proposed
transaction; provided, however, that the Company may
issue and sell Common Stock pursuant to any employee stock option
plan, stock ownership plan or dividend reinvestment plan of the
Company in effect at the Execution Time and, with as much notice as
reasonably practicable, the Company may issue Common Stock issuable
upon the conversion or exercise of Common Stock Equivalents
outstanding at the Execution Time; and further provided that
nothing in this Section 4(h) shall be construed to require that the
Manager consent to, or approve, any transaction or proposed
transaction involving the issuance of Common Stock or Common Stock
Equivalents.
(i) Market Manipulation. Until the
termination of this Agreement, the Company will not take, directly
or indirectly, any action designed to or that would constitute or
that might reasonably be expected to cause or result in, under the
Exchange Act or otherwise, stabilization or manipulation in
violation of the Act, Exchange Act or the rules and regulations
thereunder of the price of any security of the Company to
facilitate the sale or resale of the Shares or otherwise violate
any provision of Regulation M under the Exchange Act.
(j) Notification of Incorrect
Certificate. The Company will, at any time during the term
of this Agreement, as supplemented from time to time, advise the
Manager immediately after it shall have received notice or obtained
knowledge thereof, of any information or fact that would alter or
affect any opinion, certificate, letter and other document provided
to the Manager pursuant to Section 6 herein.
(k) Certification of Accuracy of
Disclosure. Upon commencement of the offering of the Shares
under this Agreement (and upon the recommencement of the offering
of the Shares under this Agreement following the termination of a
suspension of sales hereunder lasting more than 30 Trading Days),
and each time that (i) the Registration Statement or Prospectus
shall be amended or supplemented, other than by means of
Incorporated Documents, (ii) the Company files its Annual Report on
Form 10-K under the Exchange Act, (iii) the Company files its
quarterly reports on Form 10-Q under the Exchange Act, (iv) the
Company files a Current Report on Form 8-K containing amended
financial information (other than information that is furnished and
not filed), if the Manager reasonably determines that the
information in such Form 8-K is material, or (v) the Shares are
delivered to the Manager as principal at the Time of Delivery
pursuant to a Terms Agreement (such commencement or recommencement
date and each such date referred to in (i), (ii), (iii), (iv) and
(v) above, a “Representation Date”),
unless waived by the Manager, the Company shall furnish or cause to
be furnished to the Manager forthwith a certificate dated and
delivered on the Representation Date, in form reasonably
satisfactory to the Manager to the effect that the statements
contained in the certificate referred to in Section 6 of this
Agreement which were last furnished to the Manager are true and
correct at the Representation Date, as though made at and as of
such date (except that such statements shall be deemed to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in
said Section 6, modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the
date of delivery of such certificate. The requirement to furnish or
cause to be furnished a certificate under this Section 4(k) shall
be waived for any Representation Date occurring on a date on which
no instruction to the Manager to sell Shares pursuant to this
Agreement has been delivered by the Company or is pending, provided
that, if the Company subsequently decides to sell Shares following
any Representation Date when the Company relied on such waiver and
did not provide the Manager a certificate pursuant to this Section
4(k), then before the Company instructs the Manager to sell Shares
pursuant to this Agreement, the Company shall provide the Manager
such certificate.
(l) Bring Down Opinions; Negative
Assurance. At each Representation Date, unless waived by the
Manager, the Company shall furnish or cause to be furnished
forthwith to the Manager and to counsel to the Manager a written
opinion of counsel to the Company (“Company Counsel”)
addressed to the Manager and dated and delivered on such
Representation Date, in form and substance reasonably satisfactory
to the Manager, including a negative assurance representation. In
lieu of delivering such an opinion or negative assurance
representation for Representation Dates subsequent to the
commencement of the offering of the Shares under this Agreement
such counsel may furnish the Manager with a letter to the effect
that the Manager may rely on a prior opinion or negative assurance
representation delivered under Section 6(b) or this Section 4(l) to
the same extent as if it were dated the date of such letter (except
that statements in such prior opinion or negative assurance
representation shall be deemed to relate to the Registration
Statement and the Prospectus as amended or supplemented as of such
subsequent Representation Date). The requirement to furnish or
cause to be furnished an opinion (but not with respect to a
negative assurance representation) under this Section 4(l) shall be
waived for any Representation Date other than a Representation Date
on which a material amendment to the Registration Statement or
Prospectus is made or the Company files its Annual Report on Form
10-K or a material amendment thereto under the Exchange Act, unless
the Manager reasonably requests such deliverable required this
Section 4(l) in connection with a Representation Date, upon which
request such deliverable shall be deliverable hereunder;
provided,
however, that the
requirement to furnish or cause to be furnished an opinion or
negative assurance representation under this Section 4(l) shall be
waived for any Representation Date occurring on a date on which no
instruction to the Manager to sell Shares pursuant to this
Agreement has been delivered by the Company or is pending,
provided, further, that, if the Company subsequently decides to
sell Shares following any Representation Date when the Company
relied on such waiver and did not provide the Manager an opinion or
negative assurance representation pursuant to this Section 4(l),
then before the Company instructs the Manager to sell Shares
pursuant to this Agreement, the Company shall provide the Manager
such opinion or negative assurance representation.
(m) Auditor Bring Down
“Comfort” Letter. At each Representation Date,
unless waived by the Manager, the Company shall cause (1) the
Company’s auditors (the “Accountants”), or other
independent accountants satisfactory to the Manager to furnish the
Manager a letter, and (2) the Chief Financial Officer of the
Company to furnish the Manager a certificate, in each case dated on
such Representation Date, in form satisfactory to the Manager, of
the same tenor as the letters and certificate referred to in
Section 6 of this Agreement but modified to relate to the
Registration Statement and the Prospectus, as amended and
supplemented to the date of such letters and certificate. The
requirement to furnish or cause to be furnished a
“comfort” letter under this Section 4(m) shall be
waived for any Representation Date other than a Representation Date
on which a material amendment to the Registration Statement or
Prospectus is made or the Company files its Annual Report on Form
10-K or a material amendment thereto under the Exchange Act, unless
the Manager reasonably requests the deliverables required this
Section 4(m) in connection with a Representation Date, upon which
request such deliverable shall be deliverable hereunder;
provided,
however, that the
requirement to furnish or cause to be furnished a
“comfort” letter under this Section 4(m) shall be
waived for any Representation Date occurring on a date on which no
instruction to the Manager to sell Shares pursuant to this
Agreement has been delivered by the Company or is pending,
provided, further, that, if the Company subsequently decides to
sell Shares following any Representation Date when the Company
relied on such waiver and did not provide the Manager a
“comfort” letter pursuant to this Section 4(m), then
before the Company instructs the Manager to sell Shares pursuant to
this Agreement, the Company shall provide the Manager such
“comfort” letter.
(n) Due Diligence Session. Upon
commencement of the offering of the Shares under this Agreement
(and upon the recommencement of the offering of the Shares under
this Agreement following the termination of a suspension of sales
hereunder lasting more than 30 Trading Days), and at each
Representation Date, unless waived by the Manager, the Company will
conduct a due diligence session, in form and substance, reasonably
satisfactory to the Manager, which shall include representatives of
management and Accountants. The Company shall cooperate timely with
any reasonable due diligence request from or review conducted by
the Manager or its agents from time to time in connection with the
transactions contemplated by this Agreement, including, without
limitation, providing information and available documents and
access to appropriate corporate officers and the Company’s
agents during regular business hours, and timely furnishing or
causing to be furnished such certificates, letters and opinions
from the Company, its officers and its agents, as the Manager may
reasonably request. The Company shall reimburse the Manager for
Manager’s counsel’s time in each such due diligence
update session, up to a maximum of $2,500 per update, plus any
incidental expense incurred by the Manager in connection therewith.
The requirement to conduct a due diligence session under this
Section 4(n) shall be waived for any Representation Date occurring
on a date on which no instruction to the Manager to sell Shares
pursuant to this Agreement has been delivered by the Company or is
pending, provided that, if the Company subsequently decides to sell
Shares following any Representation Date when the Company relied on
such waiver and did not conduct a due diligence session pursuant to
this Section 4(n), then before the Company instructs the Manager to
sell Shares pursuant to this Agreement, the Company shall conduct a
due diligence session in accordance with this Section
4(n).
(o) Acknowledgment of Trading. The
Company consents to the Manager trading in the Common Stock for the
Manager’s own account and for the account of its clients at
the same time as sales of the Shares occur pursuant to this
Agreement or pursuant to a Terms Agreement.
(p) Disclosure of Shares Sold. The
Company will disclose in its Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q, as applicable, the number of
Shares sold through the Manager under this Agreement, the Net
Proceeds to the Company and the compensation paid by the Company
with respect to sales of Shares pursuant to this Agreement during
the relevant quarter; and, if required by any subsequent change in
Commission policy or request, more frequently by means of a Current
Report on Form 8-K or a further Prospectus Supplement.
(q) Rescission Right. If to the
knowledge of the Company, the conditions set forth in Section 6
shall not have been satisfied as of the applicable Settlement Date,
the Company will offer to any person who has agreed to purchase
Shares from the Company as the result of an offer to purchase
solicited by the Manager the right to refuse to purchase and pay
for such Shares.
(r) Bring Down of Representations and
Warranties. Each acceptance by the Company of an offer to
purchase the Shares hereunder, and each execution and delivery by
the Company of a Terms Agreement, shall be deemed to be an
affirmation to the Manager that the representations and warranties
of the Company contained in or made pursuant to this Agreement are
true and correct as of the date of such acceptance or of such Terms
Agreement as though made at and as of such date, and an undertaking
that such representations and warranties will be true and correct
as of the Settlement Date for the Shares relating to such
acceptance or as of the Time of Delivery relating to such sale, as
the case may be, as though made at and as of such date (except that
such representations and warranties shall be deemed to relate to
the Registration Statement and the Prospectus as amended and
supplemented relating to such Shares).
(s) Reservation of Shares. The
Company shall ensure that there are at all times sufficient shares
of Common Stock to provide for the issuance, free of any preemptive
rights, out of its authorized but unissued shares of Common Stock
or shares of Common Stock held in treasury, for issuance by the
Board pursuant to the terms of this Agreement. The Company will use
its commercially reasonable efforts to cause the Shares to be
listed for trading on the Trading Market and to maintain such
listing.
(t) Obligation Under Exchange Act.
During any period when the delivery of a prospectus relating to the
Shares is required (including in circumstances where such
requirement may be satisfied pursuant to Rule 172, 173 or any
similar rule) to be delivered under the Act, the Company 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 the regulations thereunder.
(u) DTC Facility. The Company shall
cooperate with Manager and use its commercially reasonable efforts
to permit the Shares to be eligible for clearance and settlement
through the facilities of DTC.
(v) Use of Proceeds. The Company
will apply the Net Proceeds from the sale of the Shares in the
manner set forth in the Prospectus.
(w) Filing of Prospectus
Supplement. If any sales of Shares are made pursuant to this
Agreement which are not made in “at the market”
offerings as defined in Rule 415, including, without limitation,
any Placement pursuant to a Terms Agreement, the Company shall file
a Prospectus Supplement describing the terms of such transaction,
the amount of Shares sold, the price thereof, the Manager’s
compensation, and such other information as may be required
pursuant to Rule 424 and Rule 430B, as applicable, within the time
required by Rule 424.
(x) Additional Registration
Statement. To the extent that the Registration Statement is
not available for the sales of the Shares as contemplated by this
Agreement, the Company shall file a new registration statement with
respect to any additional shares of Common Stock necessary to
complete such sales of the Shares and shall cause such registration
statement to become effective as promptly as practicable. After the
effectiveness of any such registration statement, all references to
“Registration
Statement” included in this Agreement shall be deemed
to include such new registration statement, including all documents
incorporated by reference therein pursuant to Item 12 of Form
S-3, and all references to “Base Prospectus” included
in this Agreement shall be deemed to include the final form of
prospectus, including all documents incorporated therein by
reference, included in any such registration statement at the time
such registration statement became effective.
5. Payment of Expenses. The
Company agrees to pay the costs and expenses incident to the
performance of its obligations under this Agreement, whether or not
the transactions contemplated hereby are consummated, including
without limitation: (i) the preparation, printing or
reproduction and filing with the Commission of the Registration
Statement (including financial statements and exhibits thereto),
the Prospectus and each Issuer Free Writing Prospectus, and each
amendment or supplement to any of them; (ii) the printing (or
reproduction) and delivery (including postage, air freight charges
and charges for counting and packaging) of such copies of the
Registration Statement, the Prospectus, and each Issuer Free
Writing Prospectus, and all amendments or supplements to any of
them, as may, in each case, be reasonably requested for use in
connection with the offering and sale of the Shares; (iii) the
preparation, printing, authentication, issuance and delivery of
certificates for the Shares, including any stamp or transfer taxes
in connection with the original issuance and sale of the Shares;
(iv) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or
documents printed (or reproduced) and delivered in connection with
the offering of the Shares; (v) the registration of the Shares
under the Exchange Act, if applicable, and the listing of the
Shares on the Trading Market; (vi) any registration or
qualification of the Shares for offer and sale under the securities
or blue sky laws of the several states (including filing fees and
the reasonable fees and expenses of counsel for the Manager
relating to such registration and qualification); (vii) the
transportation and other expenses incurred by or on behalf of
Company representatives in connection with presentations to
prospective purchasers of the Shares; (viii) the fees and
expenses of the Company’s accountants and the fees and
expenses of counsel (including local and special counsel) for the
Company; (ix) the filing fee under FINRA Rule 5110; (x) the
reasonable fees and expenses of the Manager’s counsel, not to
exceed $50,000 (excluding any periodic due diligence fees provided
for under Section 4(n)), which shall be paid upon the Execution
Time; and (xi) all other costs and expenses incident to the
performance by the Company of its obligations
hereunder.
6. Conditions to the Obligations of the
Manager. The obligations of the Manager under this Agreement
and any Terms Agreement shall be subject to (i) the accuracy
of the representations and warranties on the part of the Company
contained herein as of the Execution Time, each Representation
Date, and as of each Applicable Time, Settlement Date and Time of
Delivery, (ii) the performance by the Company of its
obligations hereunder and (iii) the following additional
conditions:
(a) Filing of Prospectus
Supplement. The Prospectus, and any supplement thereto,
required by Rule 424 to be filed with the Commission have been
filed in the manner and within the time period required by
Rule 424(b) with respect to any sale of Shares; each
Prospectus Supplement shall have been filed in the manner required
by Rule 424(b) within the time period required hereunder and
under the Act; any other material required to be filed by the
Company pursuant to Rule 433(d) under the Act, shall have been
filed with the Commission within the applicable time periods
prescribed for such filings by Rule 433; and no stop order
suspending the effectiveness of the Registration Statement or any
notice objecting to its use shall have been issued and no
proceedings for that purpose shall have been instituted or
threatened.
(b) Delivery of Opinion. The
Company shall have caused the Company Counsel to furnish to the
Manager its opinion and negative assurance statement, dated as of
such date and addressed to the Manager in form and substance
acceptable to the Manager.
(c) Delivery of Officer’s
Certificate. The Company shall have furnished or caused to
be furnished to the Manager a certificate of the Company signed by
the Chief Executive Officer or the President and the principal
financial or accounting officer of the Company, dated as of such
date, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus, any
Prospectus Supplement and any documents incorporated by reference
therein and any supplements or amendments thereto and this
Agreement and that:
(i) the representations
and warranties of the Company in this Agreement are true and
correct on and as of such date with the same effect as if made on
such date and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or
satisfied at or prior to such date;
(ii) no
stop order suspending the effectiveness of the Registration
Statement or any notice objecting to its use has been issued and no
proceedings for that purpose have been instituted or, to the
Company’s knowledge, threatened; and
(iii) since
the date of the most recent financial statements included in the
Registration Statement, the Prospectus and the Incorporated
Documents, there has been no Material Adverse Effect on the
condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the
Registration Statement and the Prospectus.
(d) Delivery of Accountants’
“Comfort” Letter. The Company shall have
requested and caused the Accountants to have furnished to the
Manager letters (which may refer to letters previously delivered to
the Manager), dated as of such date, in form and substance
satisfactory to the Manager, confirming that they are independent
accountants within the meaning of the Act and the Exchange Act and
the respective applicable rules and regulations adopted by the
Commission thereunder and that they have performed a review of any
unaudited interim financial information of the Company included or
incorporated by reference in the Registration Statement and the
Prospectus and provide customary “comfort” as to such
review in form and substance satisfactory to the
Manager.
(e) No Material Adverse Event.
Since the respective dates as of which information is disclosed in
the Registration Statement, the Prospectus and the Incorporated
Documents, except as otherwise stated therein, there shall not have
been (i) any change or decrease in previously reported results
specified in the letter or letters referred to in
paragraph (d) of this Section 6 or (ii) any change, or
any development involving a prospective change, in or affecting the
condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the
Registration Statement, the Prospectus and the Incorporated
Documents (exclusive of any amendment or supplement thereto) the
effect of which, in any case referred to in clause (i) or
(ii) above, is, in the sole judgment of the Manager, so
material and adverse as to make it impractical or inadvisable to
proceed with the offering or delivery of the Shares as contemplated
by the Registration Statement (exclusive of any amendment thereof),
the Incorporated Documents and the Prospectus (exclusive of any
amendment or supplement thereto).
(f) Payment of All Fees. The
Company shall have paid the required Commission filing fees
relating to the Shares within the time period required by
Rule 456(b)(1)(i) of the Act without regard to the proviso
therein and otherwise in accordance with Rules 456(b) and
457(r) of the Act and, if applicable, shall have updated the
“Calculation of Registration Fee” table in accordance
with Rule 456(b)(1)(ii) either in a post-effective amendment
to the Registration Statement or on the cover page of a
prospectus filed pursuant to Rule 424(b).
(g) No FINRA Objections. FINRA
shall not have raised any objection with respect to the fairness
and reasonableness of the terms and arrangements under this
Agreement.
(h) Shares Listed on Trading
Market. The Shares shall have been listed and admitted and
authorized for trading on the Trading Market, and satisfactory
evidence of such actions shall have been provided to the
Manager.
(i) Other Assurances. Prior to each
Settlement Date and Time of Delivery, as applicable, the Company
shall have furnished to the Manager such further information,
certificates and documents as the Manager may reasonably
request.
If any
of the conditions specified in this Section 6 shall not have been
fulfilled when and as provided in this Agreement, or if any of the
opinions and certificates mentioned above or elsewhere in this
Agreement shall not be reasonably satisfactory in form and
substance to the Manager and counsel for the Manager, this
Agreement and all obligations of the Manager hereunder may be
canceled at, or at any time prior to, any Settlement Date or Time
of Delivery, as applicable, by the Manager. Notice of such
cancellation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.
The
documents required to be delivered by this Section 6 shall be
delivered to the office of Ellenoff ▇▇▇▇▇▇▇▇ & Schole LLP,
counsel for the Manager, at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, email: ▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
on each such date as provided in this Agreement.
7. Indemnification and
Contribution.
(a) Indemnification by Company. The
Company agrees to indemnify and hold harmless the Manager, the
directors, officers, employees and agents of the Manager and each
person who controls the Manager within the meaning of either the
Act or the Exchange Act against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained
in the Registration Statement for the registration of the Shares as
originally filed or in any amendment thereof, or in the Base
Prospectus, any Prospectus Supplement, the Prospectus, any Issuer
Free Writing Prospectus, or in any amendment thereof or supplement
thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading
or result from or relate to any breach of any of the
representations, warranties, covenants or agreements made by the
Company in this Agreement, and agrees to reimburse each such
indemnified party for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the Company will
not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with
written information furnished to the Company by the Manager
specifically for inclusion therein. This indemnity agreement will
be in addition to any liability that the Company may otherwise
have.
(b) Indemnification by Manager. The
Manager agrees to indemnify and hold harmless the Company, each of
its directors, each of its officers who signs the Registration
Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent
as the foregoing indemnity from the Company to the Manager, but
only with reference to written information relating to the Manager
furnished to the Company by the Manager specifically for inclusion
in the documents referred to in the foregoing indemnity;
provided,
however, that in no
case shall the Manager be responsible for any amount in excess of
the Broker Fee applicable to the Shares and paid hereunder. This
indemnity agreement will be in addition to any liability which the
Manager may otherwise have.
(c) Indemnification Procedures.
Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but
the failure so to notify the indemnifying party (i) will not
relieve it from liability under paragraph (a) or (b)
above unless and to the extent it did not otherwise learn of such
action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and
(ii) will not, in any event, relieve the indemnifying party
from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or
(b) above. The indemnifying party shall be entitled to appoint
counsel of the indemnifying party’s choice at the
indemnifying party’s expense to represent the indemnified
party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for
the fees and expenses of any separate counsel retained by the
indemnified party or parties except as set forth below);
provided,
however, that such
counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party’s election to appoint
counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel
(including local counsel), and the indemnifying party shall bear
the reasonable fees, costs and expenses of such separate counsel if
(i) the use of counsel chosen by the indemnifying party to
represent the 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 indemnified
party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying
party, (iii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after
notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of
the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or
not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from
all liability arising out of such claim, action, suit or
proceeding.
(d) Contribution. In the event that
the indemnity provided in paragraph (a), (b) or
(c) of this Section 7 is unavailable to or insufficient
to hold harmless an indemnified party for any reason, the Company
and the Manager agree to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending
the same) (collectively “Losses”) to which the
Company and the Manager may be subject in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and by the Manager on the other from the
offering of the Shares; provided, however, that in no case shall
the Manager be responsible for any amount in excess of the Broker
Fee applicable to the Shares and paid hereunder. If the allocation
provided by the immediately preceding sentence is unavailable for
any reason, the Company and the Manager severally shall contribute
in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the
one hand and of the Manager on the other in connection with the
statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by
the Company shall be deemed to be equal to the total net proceeds
from the offering (before deducting expenses) received by it, and
benefits received by the Manager shall be deemed to be equal to the
Broker Fee applicable to the Shares and paid hereunder as
determined by this Agreement. Relative fault shall be determined by
reference to, among other things, whether any untrue or any alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information provided
by the Company on the one hand or the Manager on the other, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue
statement or omission. The Company and the Manager agree that it
would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), no
person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, each person
who controls the Manager within the meaning of either the Act or
the Exchange Act and each director, officer, employee and agent of
the Manager shall have the same rights to contribution as the
Manager, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution
as the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).
8. Termination.
(a) The Company shall
have the right, by giving written notice as hereinafter specified,
to terminate the provisions of this Agreement relating to the
solicitation of offers to purchase the Shares in its sole
discretion at any time upon ten (10) Business Days’ prior
written notice. Any such termination shall be without liability of
any party to any other party except that (i) with respect to
any pending sale, through the Manager for the Company, the
obligations of the Company, including in respect of compensation of
the Manager, shall remain in full force and effect notwithstanding
the termination and (ii) the provisions of Sections 5, 6,
7, 8, 9, 10, 12 and 14 of this Agreement shall remain in full force
and effect notwithstanding such termination.
(b) The Manager shall
have the right, by giving written notice as hereinafter specified,
to terminate the provisions of this Agreement relating to the
solicitation of offers to purchase the Shares in its sole
discretion at any time. Any such termination shall be without
liability of any party to any other party except that the
provisions of Sections 5, 6, 7, 8, 9, 10, 12 and 14 of this
Agreement shall remain in full force and effect notwithstanding
such termination.
(c) This Agreement
shall remain in full force and effect until the date that this
Agreement is terminated pursuant to Sections 8(a) or
(b) above or otherwise by mutual agreement of the parties,
provided that any such termination by mutual agreement shall in all
cases be deemed to provide that Sections 5, 6, 7, 8, 9, 10, 12
and 14 shall remain in full force and effect.
(d) Any termination of
this Agreement shall be effective on the date specified in such
notice of termination, provided that such termination shall not be
effective until the close of business on the date of receipt of
such notice by the Manager or the Company, as the case may be. If
such termination shall occur prior to the Settlement Date or Time
of Delivery for any sale of the Shares, such sale shall settle in
accordance with the provisions of Section 2(b) of this
Agreement.
(e) In the case of any
purchase of Shares by the Manager pursuant to a Terms Agreement,
the obligations of the Manager pursuant to such Terms Agreement
shall be subject to termination, in the absolute discretion of the
Manager, by prompt oral notice given to the Company prior to the
Time of Delivery relating to such Shares, if any, and confirmed
promptly by facsimile or electronic mail, if since the time of
execution of the Terms Agreement and prior to such delivery and
payment, (i) trading in the Common Stock shall have been
suspended by the Commission or the Trading Market or trading in
securities generally on the Trading Market shall have been
suspended or limited or minimum prices shall have been established
on such exchange, (ii) a banking moratorium shall have been
declared either by Federal or New York State authorities or
(iii) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which
on financial markets is such as to make it, in the sole judgment of
the Manager, impractical or inadvisable to proceed with the
offering or delivery of the Shares as contemplated by the
Prospectus (exclusive of any amendment or supplement
thereto).
9. Representations and Indemnities to
Survive. The respective agreements, representations,
warranties, indemnities and other statements of the Company or its
officers and of the Manager set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any
investigation made by the Manager or the Company or any of the
officers, directors, employees, agents or controlling persons
referred to in Section 7, and will survive delivery of and
payment for the Shares.
10. Notices. All communications
hereunder will be in writing and effective only on receipt, and
will be mailed, delivered, e-mailed or facsimiled to the addresses
of the Company and the Manager, respectively, set forth on the
signature page hereto.
11. Successors. This Agreement will
inure to the benefit of and be binding upon the parties hereto and
their respective successors and the officers, directors, employees,
agents and controlling persons referred to in Section 7, and
no other person will have any right or obligation
hereunder.
12. No Fiduciary Duty. The Company
hereby acknowledges that (a) the purchase and sale of the
Shares pursuant to this Agreement is an arm’s-length
commercial transaction between the Company, on the one hand, and
the Manager and any affiliate through which it may be acting, on
the other, (b) the Manager is acting solely as sales agent
and/or principal in connection with the purchase and sale of the
Company’s securities and not as a fiduciary of the Company
and (c) the Company’s engagement of the Manager in
connection with the offering and the process leading up to the
offering is as independent contractors and not in any other
capacity. Furthermore, the Company agrees that it is solely
responsible for making its own judgments in connection with the
offering (irrespective of whether the Manager has advised or is
currently advising the Company on related or other matters). The
Company agrees that it will not claim that the Manager has rendered
advisory services of any nature or respect, or owe an agency,
fiduciary or similar duty to the Company, in connection with such
transaction or the process leading thereto.
13. Integration. This Agreement and
any Terms Agreement supersede all prior agreements and
understandings (whether written or oral) between the Company and
the Manager with respect to the subject matter hereof.
14. Amendments; Waivers. No
provision of this Agreement may be waived, modified, supplemented
or amended except in a written instrument signed, in the case of an
amendment, by the Company and the Manager. No waiver of any default
with respect to any provision, condition or requirement of this
Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or
omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right.
15. Applicable Law. This Agreement
and any Terms Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of
New York. Each of the Company and the Manager: (i) agrees that
any legal suit, action or proceeding arising out of or relating to
this Agreement shall be instituted exclusively in New York Supreme
Court, County of New York, or in the United States District Court
for the Southern District of New York, (ii) waives any objection
which it may have or hereafter to the venue of any such suit,
action or proceeding, and (iii) irrevocably consents to the
jurisdiction of the New York Supreme Court, County of New York, and
the United States District Court for the Southern District of New
York in any such suit, action or proceeding. Each of the Company
and the Manager further agrees to accept and acknowledge service of
any and all process which may be served in any such suit, action or
proceeding in the New York Supreme Court, County of New York, or in
the United States District Court for the Southern District of New
York and agrees that service of process upon the Company mailed by
certified mail to the Company’s address shall be deemed in
every respect effective service of process upon the Company, in any
such suit, action or proceeding, and service of process upon the
Manager mailed by certified mail to the Manager’s address
shall be deemed in every respect effective service process upon the
Manager, in any such suit, action or proceeding. If either party
shall commence an action or proceeding to enforce any provision of
this Agreement, then the prevailing party in such action or
proceeding shall be reimbursed by the other party for its
reasonable attorney’s fees and other costs and expenses
incurred with the investigation, preparation and prosecution of
such action or proceeding.
16. WAIVER
OF JURY TRIAL. THE COMPANY 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, ANY TERMS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
17. Counterparts. This Agreement
and any Terms Agreement may be signed in one or more counterparts,
each of which shall constitute an original and all of which
together shall constitute one and the same agreement, which may be
delivered by facsimile or in .pdf file via e-mail.
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18. Headings. The section headings
used in this Agreement and any Terms Agreement are for convenience
only and shall not affect the construction hereof.
If the
foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate
hereof, whereupon this letter and your acceptance shall represent a
binding agreement among the Company and the Manager.
Very
truly yours,
By:
/s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇.
Herald
Name:
▇▇▇▇▇▇▇▇▇▇▇ ▇. Herald
Title:
Chief Executive Officer
Address for
Notice:
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief
Financial Officer
E-mail:
▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
The
foregoing Agreement is hereby confirmed and accepted as of the date
first written above.
▇.▇.
▇▇▇▇▇▇▇▇▇▇ & CO., LLC
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By: /s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title:
Chief Operating Officer
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Address for
Notice:
▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Chief Executive Officer
E-mail:
▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
Form of Terms Agreement
ANNEX I
TERMS AGREEMENT
Dear
Sirs:
Solitario Zinc Corp. (the “Company”) proposes,
subject to the terms and conditions stated herein and in the At The
Market Offering Agreement, dated February ___, 2021 (the
“At The Market
Offering Agreement”), between the Company and ▇.▇.
▇▇▇▇▇▇▇▇▇▇ & Co., LLC (“Agent”), to issue and
sell to Agent the securities specified in the Schedule I hereto (the
“Purchased
Shares”).
Each of the provisions of the At The Market Offering Agreement not
specifically related to the solicitation by Agent, as agent of the
Company, of offers to purchase securities is incorporated herein by
reference in its entirety, and shall be deemed to be part of this
Terms Agreement to the same extent as if such provisions had been
set forth in full herein. Each of the representations and
warranties set forth therein shall be deemed to have been made at
and as of the date of this Terms Agreement and the Time of
Delivery, except that each representation and warranty in
Section 3 of the At The Market Offering Agreement which makes
reference to the Prospectus (as therein defined) shall be deemed to
be a representation and warranty as of the date of the At The
Market Offering Agreement in relation to the Prospectus, and also a
representation and warranty as of the date of this Terms Agreement
and the Time of Delivery in relation to the Prospectus as amended
and supplemented to relate to the Purchased Shares.
An amendment to the Registration Statement (as defined in the At
The Market Offering Agreement), or a supplement to the Prospectus,
as the case may be, relating to the Purchased Shares, in the form
heretofore delivered to the Agent is now proposed to be filed with
the Securities and Exchange Commission.
Subject to the terms and conditions set forth herein and in the At
The Market Offering Agreement which are incorporated herein by
reference, the Company agrees to issue and sell to Agent and the
latter agrees to purchase from the Company the number of shares of
the Purchased Shares at the time and place and at the purchase
price set forth in the Schedule I
hereto.
If the foregoing is in
accordance with your understanding, please sign and return to us a
counterpart hereof, whereupon this Terms Agreement, including those
provisions of the At The Market Offering Agreement incorporated
herein by reference, shall constitute a binding agreement between
the Agent and the Company.
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Name:
Title:
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ACCEPTED as of the
date first written above.
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▇.▇.
▇▇▇▇▇▇▇▇▇▇ & CO., LLC
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By:__________________________________________
Name:
Title: