ADAMIS PHARMACEUTICALS CORPORATION 8-K
Exhibit
1.1
EXECUTION VERSION
12,000,000 Shares
Adamis Pharmaceuticals Corporation
Common Stock
And Warrants to Purchase up to
12,000,000 Shares of Common Stock*
UNDERWRITING AGREEMENT
St. Petersburg, Florida
August 1, 2019
Raymond James & Associates, Inc.
As Representative of the Several Underwriters
listed on Schedule
I hereto
880 Carillon Parkway
St. Petersburg, Florida 33716
Ladies and Gentlemen:
Adamis
Pharmaceuticals Corporation, a Delaware corporation (the “Company”), proposes, subject to the terms and
conditions stated herein, to issue and sell to the several Underwriters named in Schedule I hereto (the
“Underwriters”), an aggregate of 12,000,000 shares (the “Firm Shares”) of its Common Stock, par value
$0.0001 per share (the “Common Stock”) and (ii) warrants to purchase up to an aggregate of 12,000,000 shares of
Common Stock on the terms and conditions set forth in the form of warrant attached as Exhibit A hereto (the “Firm
Warrants,” and together with the Firm Shares, the “Firm Securities”). All of the Firm Securities are to be
issued and sold by the Company. The respective amounts of the Firm Securities to be purchased by each of the several
Underwriters are set forth on Schedule I hereto. In addition, the Company has agreed to sell to the Underwriters, upon the
terms and conditions stated herein, up to an additional (i) 1,800,000 shares of Common Stock (the “Additional
Shares,” and together with the Firm Shares, the “Shares”) and/or (ii) warrants to purchase up to an
aggregate of 1,800,000 shares of Common Stock (the “Additional Warrants,” and together with the Additional
Shares, the “Additional Securities”). The Firm Warrants and Additional Warrants are referred to herein as the
“Warrants” and the shares of Common Stock underlying the Warrants are referred to herein as the “Warrant
Shares.” The Firm Securities, the Additional Securities, the Shares and the Warrant Shares are collectively referred to
in this Agreement as the “Securities.” Raymond James & Associates, Inc. is acting as the representative of
the several Underwriters and in such
* Plus
up to an additional 1,800,000 shares and/or warrants to purchase up to an additional 1,800,000 shares subject to
Underwriter’s over-allotment option.
capacity is referred to in this Agreement as the “Representative.”
The Company wishes
to confirm as follows its agreement with you and the other several Underwriters, on whose behalf you are acting, in connection
with the several purchases of the Securities from the Company.
1.
Registration Statement and Prospectus. The Company has prepared and filed with the Securities and Exchange Commission
(the “Commission”) in accordance with the provisions of the Securities Act of 1933, as amended (the “Act”),
and the rules and regulations of the Commission thereunder (the “Rules”), a registration statement on Form S-3 (File
No. 333-226100), including a base prospectus (the “Base Prospectus”), relating to, among other things, the Securities.
Such registration statement, as amended, including the financial statements, exhibits and schedules thereto, at each time of effectiveness
under the Act for purposes of Section 11 of the Act, as such section applies to the Underwriters (the “Effective Time”),
including any required information deemed to be part thereof at the time of effectiveness pursuant to Rule 430B under the Act or
the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Exchange
Act”) is called the “Registration Statement.” Any preliminary prospectus supplement to the Base Prospectus that
describes the Securities and the offering thereof and is used prior to the filing of the Prospectus is called, together with the
Base Prospectus, a “Preliminary Prospectus.” The term “Prospectus” shall mean the prospectus supplement
relating to the Securities, together with the Base Prospectus, that is first filed pursuant to Rule 424(b) under the Act after
the date and time that this Agreement is executed and delivered to the parties hereto. If the Company files another registration
statement with the Commission to register a portion of the Securities pursuant to Rule 462(b) under the Act (the “Rule 462
Registration Statement”), then any reference to “Registration Statement” herein shall be deemed to include the
registration statement on Form S-3 (File No. 333-226100) and the Rule 462 Registration Statement, as each such registration statement
may be amended pursuant to the Act. For purposes of this Agreement, “free writing prospectus” has the meaning ascribed
to it in Rule 405 under the Act, and “Issuer Free Writing Prospectus” shall mean each free writing prospectus prepared
by or on behalf of the Company or used or referred to by the Company in connection with the offering of the Securities. All references
in this Agreement to the Registration Statement, the Rule 462 Registration Statement, a Preliminary Prospectus, the Prospectus
or the General Disclosure Package (as defined below), or any amendments or supplements to any of the foregoing, shall be deemed
to refer to and include any documents incorporated by reference therein, and shall include any copy thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”).
Any reference in this
Agreement to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Act, as of the date of the Registration Statement,
such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to any amendment or supplement to the Registration
Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after such
date under the Exchange Act that, upon filing, are incorporated by reference therein, as
required by paragraph (b) of Item 12 of
Form S-3. As used herein, the term “Incorporated Documents” means the documents that at the time of filing are incorporated
by reference in the Registration Statement, any Preliminary Prospectus, the Prospectus or any amendment or supplement thereto.
2. Agreements
to Sell and Purchase. Upon the terms and conditions set forth herein, Company hereby agrees to issue and sell an
aggregate of 12,000,000 Firm Shares and 12,000,000 Firm Warrants to the Underwriters. Upon the basis of the
representations, warranties and agreements of the Company herein contained and subject to all the terms and conditions set
forth herein, each Underwriter agrees, severally and not jointly, to purchase from the Company at a purchase price of
$0.94 per Firm Share and related Firm Warrants, the number of Firm Securities set forth opposite the name of such
Underwriter in Schedule I hereto.
The Company
hereby also agrees to sell to the Underwriters, and, upon the basis of the representations, warranties and agreements of the
Company herein contained and subject to all the terms and conditions set forth herein, the Underwriters shall have the right
for 30 days from the date of the Prospectus to purchase from the Company up to 1,800,000 Additional Shares at a purchase
price per share of $0.9306 for the Additional Shares and/or 1,800,000 Additional Warrants at a purchase price
$0.94 per warrant for the Additional Warrants. If any Additional Securities are to be purchased, each Underwriter,
severally and not jointly, agrees to purchase the number of Additional Securities (subject to such adjustments as you may
determine to avoid fractional shares) that bears the same proportion to the total number of Additional Securities to be
purchased by the Underwriter as the number of Firm Securities set forth opposite the name of such Underwriter in Schedule I
hereto bears to the total number of Firm Securities. The option to purchase Additional Securities may be exercised, in whole
or in part, at any time within 30 days after the date of the Prospectus.
3.
Terms of Public Offering. The Company has been advised by you that the Underwriters propose to make a public offering
of their respective portions of the Securities as soon after this Agreement has become effective as in your judgment is advisable
and initially to offer the Securities upon the terms set forth in the Prospectus.
Not later than 12:00
p.m. on the second business day following the date the Securities are released by the Underwriters for sale to the public, the
Company shall deliver or cause to be delivered copies of the Prospectus in such quantities and at such places as the Representative
shall request.
4. Delivery of the Securities and Payment Therefor.
Delivery to the Underwriters of the Firm Securities and payment therefor shall be made at the offices of Raymond James &
Associates, Inc., 880 Carillon Parkway, St. Petersburg, Florida 33716 at 10:00 a.m., St. Petersburg, Florida time, on August
15, 2019, or such other place, time and date not later than 1:30 p.m., St. Petersburg, Florida time, on August 5, 2019, as
the Representative shall designate by notice to the Company (the time and date of such closing are called the “Closing
Date”). The place of closing for the Firm Securities and the Closing Date may be varied by agreement between the
Representative and the Company. The Company hereby acknowledges that circumstances under which the Representative may provide
notice to postpone the Closing Date as originally scheduled include any determination by the Company or the Representative to
recirculate to the public copies of an amended or supplemented Prospectus or a delay as contemplated by the provisions of
Section 11 hereof.
Delivery to the Underwriters
of and payment for any Additional Securities to be purchased by the Underwriters shall be made at the offices of Raymond James & Associates, Inc., 880 Carillon Parkway, St. Petersburg, Florida 33716, at 10:00 a.m., St. Petersburg, Florida time, on such
date or dates (the “Additional Closing Date”) (which may be the same as the Closing Date, but shall in no event be
earlier than the Closing Date nor earlier than two nor later than ten business days after the giving of the notice hereinafter
referred to) as shall be specified in a written notice, from the Representative on behalf of the Underwriters to the Company, of
the Underwriters’ determination to purchase a number, specified in such notice, of Additional Securities. Such notice may
be given at any time within 30 days after the date of the Prospectus and must set forth the aggregate number of Additional Securities
as to which the Underwriters are exercising the option. The place of closing for the Additional Securities and the Additional Closing
Date may be varied by agreement between you and the Company.
The Firm Securities
and any Additional Securities to be purchased hereunder shall be delivered to you on the Closing Date or the Additional Closing
Date, as the case may be, against payment of the purchase price therefore by wire transfer of immediately available funds to an
account specified in writing, not later than the close of business on the business day next preceding the Closing Date or the Additional
Closing Date, as the case may be, by the Company. Payment for the Securities sold by the Company hereunder shall be delivered by
the Representative to the Company. Delivery of the Securities shall be made through the facilities of The Depositary Trust Company
unless the Representative shall otherwise instruct.
It is understood that
the Representative has been authorized, for its own account and the accounts of the several Underwriters, to accept delivery of
and receipt for, and make payment of the purchase price per Share for the Firm Shares and the Additional Shares, if any, that the
Underwriters have agreed to purchase. Raymond James & Associates, Inc., individually and not as Representative of the Underwriters,
may, but shall not be obligated to, make payment for
any Securities to be purchased by any Underwriter whose funds shall not have
been received by the Representative by the Closing Date or the Additional Closing Date, as the case may be, for the account of
such Underwriter, but any such payment shall not relieve such Underwriter from any of its obligations under this Agreement.
5.
Covenants and Agreements of the Company.
The Company covenants
and agrees with the several Underwriters as follows:
(a)
The Company will use its best efforts to cause the Registration Statement and any amendments thereto to become effective,
if it has not already become effective, and will advise you promptly and, if requested by you, will confirm such advice in writing
(i) when the Registration Statement has become effective and the time and date of any filing of any post-effective amendment to
the Registration Statement or any amendment or supplement to any Preliminary Prospectus or the Prospectus and the time and date
that any post-effective amendment to the Registration Statement becomes effective, (ii) if Rule 430A under the Act is employed,
when the Prospectus has been timely filed pursuant to Rule 424(b) under the Act, (iii) of the receipt of any comments of the Commission,
or any request by the Commission for amendments or supplements to the Registration Statement, any Preliminary Prospectus or the
Prospectus or for additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or of the suspension of qualification of the Securities for offering or sale in any jurisdiction
or the initiation of any proceeding for such purposes and (v) within the period of time referred to in Section 5(h) hereof, of
any material change in the Company’s condition (financial or other), business, prospects, properties, net worth or results
of operations, or of any event that comes to the attention of the Company that makes any statement made in the Registration Statement
or the Prospectus (as then amended or supplemented) untrue in any material respect or that requires the making of any additions
thereto or changes therein in order to make the statements therein (in the case of the Prospectus, in light of the circumstances
under which they were made) not misleading in any material respect, or of the necessity to amend or supplement the Prospectus (as
then amended or supplemented) to comply with the Act or any other law. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Company will make every reasonable effort to obtain the withdrawal
or lifting of such order at the earliest possible time. The Company will provide the Underwriters with copies of the form of Prospectus,
in such number as the Underwriters may reasonably request, and file with the Commission such Prospectus in accordance with Rule
424(b) under the Act before the close of business on the first business day immediately following the date hereof.
(b)
The Company will furnish to you, without charge, two signed duplicate originals of the Registration Statement as originally
filed with the Commission and of each amendment thereto, including financial statements and all exhibits thereto, and will also
furnish to you, without charge, such number of conformed copies of the Registration Statement as originally filed and of each amendment
thereto as you may reasonably request.
(c)
The Company will promptly file with the Commission any amendment or
supplement to the Registration Statement or the Prospectus
that may, in the judgment of the Company or the Representative be required by the Act or requested by the Commission.
(d)
The Company will furnish a copy of any amendment or supplement to the Registration Statement or to the Prospectus or any
Issuer Free Writing Prospectus to you and counsel for Underwriters and obtain your consent prior to filing any of those with the
Commission.
(e)
The Company will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus without
your prior consent.
(f)
The Company will retain in accordance with the Act all Issuer Free Writing Prospectuses not required to be filed pursuant
to the Act; and if at any time after the date hereof any events shall have occurred as a result of which any Issuer Free Writing
Prospectus, as then amended or supplemented, would conflict with the information in the Registration Statement, the most recent
Preliminary Prospectus or the Prospectus or would include an 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,
or, if for any other reason it shall be necessary to amend or supplement any Issuer Free Writing Prospectus, to notify you and,
upon your request, to file such document and to prepare and furnish without charge to each Underwriter as many copies as they may
from time to time reasonably request of an amended or supplemented Issuer Free Writing Prospectus that will correct such conflict,
statement or omission or effect such compliance.
(g)
Prior to the execution and delivery of this Agreement, the Company has delivered or will deliver to you, without charge,
in such quantities as you have requested or may hereafter reasonably request, copies of each form of the Preliminary Prospectus.
Consistent with the provisions of Section 5(h) hereof, the Company consents to the use, in accordance with the provisions of the
Act and with the securities or Blue Sky laws of the jurisdictions in which the Securities are offered by the several Underwriters
and by dealers, prior to the date of the Prospectus, of each Preliminary Prospectus so furnished by the Company.
(h)
As soon after the execution and delivery of this Agreement as is practicable and thereafter from time to time for such period
as in the reasonable opinion of counsel for the Underwriters a prospectus is required by the Act to be delivered in connection
with sales by any Underwriter or a dealer (the “Prospectus Delivery Period”), and for so long a period as you may request
for the distribution of the Securities, the Company will deliver to each Underwriter and each dealer, without charge, as many copies
of the Prospectus and the General Disclosure Package (and of any amendment or supplement thereto) as they may reasonably request.
The Company consents to the use of the Prospectus and the General Disclosure Package (and of any amendment or supplement thereto)
in accordance with the provisions of the Act and with the securities or Blue Sky laws of the jurisdictions in which the Securities
are offered by the several Underwriters and by all dealers to whom Securities may be sold, both in connection with the offering
and sale of the Securities and for such period of time thereafter as the Prospectus is required by the Act to be delivered in connection
with sales by any Underwriter or dealer. If at
any time prior to the later of (i) the completion of the distribution of the Securities
pursuant to the offering contemplated by the Registration Statement or (ii) the expiration of prospectus delivery requirements
with respect to the Securities under Section 4(3) of the Act and Rule 174 thereunder, any event shall occur that in the judgment
of the Company or in the opinion of counsel for the Underwriters is required to be set forth in the Prospectus (as then amended
or supplemented) or should be set forth therein in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or amend the Prospectus to comply with the Act or any
other law, the Company will forthwith prepare and, subject to Section 5(a) hereof, file with the Commission and use its best efforts
to cause to become effective as promptly as possible an appropriate supplement or amendment thereto, and will furnish to each Underwriter
who has previously requested Prospectuses, without charge, a reasonable number of copies thereof. In addition, during the Prospectus
Delivery Period, the Company will file all documents required to be filed with the Commission pursuant to Sections 13, 14 and 15
of the Exchange Act in the manner and within the time periods required by the Exchange Act.
(i)
The Company will cooperate with you and counsel for the Underwriters in connection with the registration or qualification
of the Securities for offering and sale by the several Underwriters and by dealers under the securities or Blue Sky laws of such
jurisdictions as you may reasonably designate and will file such consents to service of process or other documents as may be reasonably
necessary in order to effect and maintain such registration or qualification for so long as required to complete the distribution
of the Securities; 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 general service of process in suits, other than those
arising out of the offering or sale of the Securities, as contemplated by this Agreement and the Prospectus, in any jurisdiction
where it is not now so subject. In the event that the qualification of the Securities in any jurisdiction is suspended, the Company
shall so advise you promptly in writing. The Company will use its best efforts to qualify or register its Common Stock for sale
in non-issuer transactions under (or obtain exemptions from the application of) the Blue Sky laws of each state where necessary
to permit market making transactions and secondary trading and will comply with such Blue Sky laws and will continue such qualifications,
registrations and exemptions in effect for so long as is required for the distribution of the Securities.
(j)
The Company will make generally available to its security holders a consolidated earnings statement (in form complying with
the provisions of Rule 158), which need not be audited, covering a twelve-month period commencing after the effective date of the
Registration Statement and the Rule 462 Registration Statement, if any, and ending not later than 15 months thereafter, as soon
as practicable after the end of such period, which consolidated earnings statement shall satisfy the provisions of Section 11(a)
of the Act.
(k)
During the period ending three years from the date hereof, upon your request, the Company will furnish to you and to each
of the other Underwriters as requested, (i) as soon as available, a copy of each proxy statement, quarterly or annual report or
other report of the Company mailed to stockholders or filed with the Commission, the Financial Industry
Regulatory Authority, Inc.
(“FINRA”) or the Nasdaq Stock Market (“NASDAQ”) or any national securities exchange and (ii) from time
to time such other information concerning the Company as you may reasonably request.
(l)
If this Agreement shall terminate or shall be terminated after execution pursuant to any provision hereof (except pursuant
to a termination under Section 12 hereof, other than clause (iv)) or if this Agreement shall be terminated by the Underwriters
because of any inability, failure or refusal on the part of the Company to perform in all material respects any agreement herein
or to comply in all material respects with any of the terms or provisions hereof or to fulfill in all material respects any of
the conditions of this Agreement, the Company agrees to reimburse you and the other Underwriters for all reasonable out-of-pocket
costs and expenses (including travel expenses and reasonable fees and expenses of counsel for the Underwriters) not to exceed $100,000
reasonably incurred by you in connection herewith.
(m)
The Company will apply the net proceeds from the sale of the Securities to be sold by it hereunder in accordance in all
material respects with the statements under the caption “Use of Proceeds” in the Prospectus.
(n) For
a period commencing on the date hereof and ending on the 90th day after the date of the Prospectus (the
“Lock-Up Period”), not to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or
enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at
any time in the future of) any shares of Common Stock or securities convertible into or exchangeable for Common Stock (other
than the Common Stock issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation
plans existing on the date hereof or pursuant to currently outstanding options, warrants or rights, provided that such
securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease
the exercise price, exchange price or conversion price of such securities or to extend the term of such securities), or sell or grant
options, rights or warrants with respect to any shares of Common Stock or securities convertible into or exchangeable for
Common Stock (other than the grant of options pursuant to option plans existing on the date hereof), (2) enter into any swap
or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of
ownership of such shares of Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled
by delivery of Common Stock or other securities, in cash or otherwise, (3) file or cause to be filed a registration
statement, including any amendments, with respect to the registration of any shares of Common Stock or securities
convertible, exercisable or exchangeable into Common Stock or any other securities of the Company (other than the filing of a
registration statement on Form S-8 in connection with the Company’s equity incentive plans) or (4) publicly disclose
the intention to do any of the foregoing, in each case without the prior written consent of the Representative on behalf of
the Underwriters, and to cause each officer, director and stockholder of the Company set forth on Schedule III hereto to
furnish to the Representative, prior to the Initial Delivery Date, a letter or letters, substantially in the form of Exhibit
B hereto (the “Lock-Up Agreements”).
(o)
Prior to the Closing Date or the Additional Closing Date, as the case may be, the Company will furnish to you, as promptly
as possible, copies of any unaudited interim consolidated financial statements of the Company and its subsidiaries for any period
subsequent to the periods covered by the financial statements appearing in the Prospectus.
(p)
The Company will comply with all provisions of any undertakings contained in the Registration Statement.
(q)
The Company will not at any time, directly or indirectly, take any action designed, or which might reasonably be expected
to cause or result in, or which will constitute, stabilization or manipulation of the price of the shares of Common Stock to facilitate
the sale or resale of any of the Securities.
(r)
The Company will timely file with NASDAQ all documents and notices required by NASDAQ of companies that have or will issue
securities that are traded on NASDAQ.
(s)
The Company shall engage and maintain, at its expense, a transfer agent and, if necessary under the jurisdiction of its
incorporation or the rules of any national securities exchange on which the Common Stock is listed, a registrar (which, if permitted
by applicable laws and rules may be the same entity as the transfer agent) for the Common Stock.
6.
Representations and Warranties of the Company.
The Company hereby
represents and warrants to each Underwriter on the date hereof, and shall be deemed to represent and warrant to each Underwriter
on the Closing Date and the Additional Closing Date, as the case may be, that:
(a) The Company was at the time of the filing of the Registration Statement eligible to use Form S-3. As of the date of this
Agreement, the Company is eligible to use Form S-3 under the Act and it meets the transaction requirements in accordance with General
Instruction I.B.1 of Form S-3. The Company filed with the Commission the Registration Statement on such Form S-3, including a Base
Prospectus for registration under the Act of the offering and sale of the Securities, and the Company has prepared and used a Preliminary
Prospectus in connection with the offer and sale of the Securities. When the Registration Statement or any amendment thereof or
supplement thereto was or is declared effective and as of the date of the most recent amendment to the Registration Statement,
it (i) complied or will comply, in all material respects, with the requirements of the Act and the Rules and the Exchange Act and
the rules and regulations of the Commission thereunder and (ii) did not or will not, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not
misleading. When any Preliminary Prospectus or Prospectus was first filed with the Commission (whether filed as part of the Registration
Statement or any amendment thereto or pursuant to Rule 424 of the Rules) and when any amendment thereof or supplement thereto was
first filed with the Commission, such Preliminary Prospectus or Prospectus as amended or supplemented complied in all material
respects with the applicable provisions of the Act and the Rules and did not or will not, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not
misleading. If applicable, each Preliminary Prospectus and the Prospectus delivered to the Underwriters for use in connection
with
this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T. Notwithstanding the foregoing, none of the representations and warranties in this
paragraph 6(a) shall apply to statements in, or omissions from, the Registration Statement, any Preliminary Prospectus or the Prospectus
made in reliance upon, and in conformity with, information herein or otherwise furnished in writing by the Representative specifically
for use in the Registration Statement, any Preliminary Prospectus or the Prospectus (the “Underwriting Information”).
(b)
As of the Applicable Time (as hereinafter defined), neither (i) the price to the public and the number of Securities offered
and sold, as indicated on the cover page of the Prospectus and the Statutory Prospectus (as hereinafter defined), all considered
together with the free writing prospectuses, if any, identified on Schedule II hereto (collectively, the “General Disclosure
Package”), nor (ii) any individual Issuer Free Writing Prospectus when considered together with the General Disclosure
Package, included, includes or will include any untrue statement of a material fact or omitted, omits or will omit to state any
material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided however, that this representation and warranty shall not apply to statements
in or omissions in the General Disclosure Package made in reliance upon and in conformity with the Underwriter Information.
Each Issuer Free Writing
Prospectus, including any electronic road show (including without limitation any “bona fide electronic road show” as
defined in Rule 433(h)(5) under the Act) (each, a “Road Show”) (i) is identified in Schedule II hereto and (ii) complied
when issued, and complies, in all material respects with the requirements of the Act and the Rules and the Exchange Act and the
rules and regulations of the Commission thereunder.
As used in this Section and elsewhere in this Agreement:
“Applicable
Time” means 8:30 a.m. (Eastern time) on the date of this Agreement.
“Statutory
Prospectus” as of any time means the Preliminary Prospectus relating to the Securities immediately prior to the Applicable
Time, including any document incorporated by reference therein and any prospectus supplement deemed to be a part thereof.
(c)
The Registration Statement is effective under the Act and no stop order preventing or suspending the effectiveness of the
Registration Statement or suspending or preventing the use of any Preliminary Prospectus, the Prospectus or any “free writing
prospectus”, as defined in Rule 405 under the Rules, has been issued by the Commission and no proceedings for that purpose
have been instituted or, to the Company’s knowledge, are threatened under the Act. Any required filing of any Preliminary
Prospectus and/or the Prospectus and any supplement thereto pursuant to Rule 424(b) of the Rules has been or will be made in the
manner and within the time period required by such Rule 424(b). Any material required to be filed by the Company pursuant to Rule
433(d) or Rule 163(b)(2) of the Rules has been or will be made in the manner and within the time period required by such Rules.
(d)
The documents incorporated by reference in the Registration Statement, any Preliminary Prospectus and the Prospectus, at
the time they became effective or were filed with the Commission, as the case may be, complied in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none
of such documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading,
and any further documents so filed and incorporated by reference in the Registration Statement, any Preliminary Prospectus and
the Prospectus, when such documents become effective or are filed with the Commission, as the case may be, will conform in all
material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading.
(e)
Each Issuer Free Writing Prospectus, if any, as of its issue date and at all subsequent times through the completion of
the public offer and sale of the Securities or until any earlier date that the Company notified or notifies the Representative
as described in the next sentence, did not, does not and will not include any information that conflicted, conflicts or will conflict
with the information contained in the Registration Statement, including any document incorporated by reference therein and
any prospectus supplement deemed to be a part thereof that has not been superseded or modified, the Statutory Prospectus or the
Prospectus.
If at any time following
issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer
Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement, the Statutory
Prospectus or the Prospectus or included or would include an untrue statement of a material fact or omitted or would omit to state
a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances
prevailing at the subsequent time, not misleading, the Company has promptly notified or will promptly notify the Representative
and has promptly amended or will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate
or correct such conflict, untrue statement or omission.
(f)
The financial statements of the Company (including all notes and schedules thereto) included or incorporated by reference
in the General Disclosure Package, the Registration Statement, the Statutory Prospectus and Prospectus present fairly the financial
position of the Company and its consolidated subsidiaries at the dates indicated and the statement of operations, stockholders’
equity and cash flows of the Company and its consolidated subsidiaries for the periods specified; and such financial statements
and related schedules and notes thereto, and the unaudited financial information filed with the Commission as part of the Registration
Statement, have been prepared in conformity with generally accepted accounting principles of the United States (“U.S. GAAP”),
consistently applied throughout the periods involved. The summary and selected financial data included or incorporated by reference
in the General Disclosure Package, Statutory Prospectus and Prospectus present fairly, in all material respects, the information
shown therein as at the respective dates and for the respective periods
specified and have been presented on a basis consistent
with the consolidated financial statements set forth in the Prospectus and other financial information. The pro forma financial
statements and the related notes thereto included or incorporated by reference in the General Disclosure Package, the Registration
Statement, the Statutory Prospectus and the Prospectus present fairly, in all material respects, the information shown therein,
have been prepared in accordance with the Commission’s rules and guidelines with respect to pro forma financial statements
and have been properly compiled on the bases described therein, and the assumptions used in the preparation thereof are believed
by the Company to be reasonable and the adjustments used therein are believed by the Company to be appropriate to give effect to
the transactions and circumstances referred to therein.
(g)
Mayer Hoffman McCann P.C. (“Auditor”) is an independent registered public accounting firm as required by the
Act and the Rules whose reports are filed with the Commission as a part of the Registration Statement, the General Disclosure Package
and the Prospectus is and, during the periods covered by its reports, was an independent registered public accounting firm as required
by the Act and the Rules.
(h)
The Company and each of its subsidiaries, including each entity (corporation, partnership, joint venture, association or
other business organization) controlled directly or indirectly by the Company (each, a “subsidiary”), is duly organized,
validly existing and in good standing under the laws of their respective jurisdictions of incorporation or organization and each
such entity has all requisite corporate power and authority to carry on its business as is currently being conducted as described
in the General Disclosure Package, the Statutory Prospectus and the Prospectus, and to own, lease and operate its properties. All
of the issued shares of capital stock of, or other ownership interests in, each subsidiary have been duly and validly authorized
and issued and are fully paid and non-assessable and are owned, directly or indirectly, by the Company, free and clear of any lien,
charge, mortgage, pledge, security interest, claim, limitation on voting rights, equity, trust or other encumbrance, preferential
arrangement, defect or restriction of any kind whatsoever. The Company and each of its subsidiaries is duly qualified to do business
and is in good standing as a foreign corporation in each jurisdiction in which the nature of the business conducted by it or location
of the assets or properties owned, leased or licensed by it requires such qualification, except for such jurisdictions where the
failure to so qualify individually or in the aggregate would not have a material adverse effect on the assets, properties, condition,
financial or otherwise, or in the results of operations, business affairs or business prospects of the Company and its subsidiaries
considered as a whole (a “Material Adverse Effect”); and to the Company’s knowledge, no proceeding has been instituted
in any such jurisdiction revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such power and authority or
qualification.
(i)
The Registration Statement initially became effective within three years of the date hereof. If, immediately prior to the
third anniversary of the initial effective date of the Registration Statement, any of the Securities remain unsold by the Underwriters,
the Company will, prior to that third anniversary file, if it has not already done so, a new “shelf” registration statement
relating to the Securities, in a form satisfactory to the Representative, will use its best efforts to cause such registration
statement to be declared effective within 180 days after that third anniversary, and will take all other action necessary
or appropriate to permit the public
offering and sale of the Securities to continue as contemplated in the expired Registration
Statement. References herein to the registration statement relating to the Securities shall include such new “shelf”
registration statement.
(j)
The Company and each of its subsidiaries has all requisite corporate power and authority, and all necessary authorizations,
approvals, consents, orders, licenses, certificates and permits of and from all governmental or regulatory bodies or any other
person or entity (collectively, the “Permits”), to own, lease and license its assets and properties and conduct its
business, all of which are valid and in full force and effect, except where the lack of such Permits, individually or in the aggregate,
would not have a Material Adverse Effect. The Company and each of its subsidiaries has fulfilled and performed in all material
respects all of its obligations with respect to such Permits and no event has occurred that allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any other material impairment of the rights of the Company thereunder.
Except as may be required under the Act and state and foreign Blue Sky laws, no other Permits are required to enter into, deliver
and perform this Agreement and to issue and sell the Securities.
(k)
(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 Rules) for the Securities and (ii) at the date
hereof, the Company was not and is not an “ineligible issuer,” as defined in Rule 405 of the Rules,
including (but not limited to) the Company or any other subsidiary in the preceding three years not having been convicted of a
felony or misdemeanor or having been made the subject of a judicial or administrative decree or order as described in Rule 405
of the Rules.
(l)
The Company and its subsidiaries own or possess the exclusive right to use all patents, trademarks, trademark registrations,
service marks, service mark registrations, trade names, copyrights, licenses, inventions, software, databases, know-how, Internet
domain names, trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures,
and other material intellectual property necessary or desirable to carry on their respective businesses as currently conducted,
and as proposed to be conducted (collectively, “Intellectual Property”), and, except as described in the Registration
Statement, the General Disclosure Package, the Statutory Prospectus and the Prospectus, the Company is not aware of any claim to
the contrary or any challenge by any other person to the rights of the Company and its subsidiaries with respect to the foregoing.
The Intellectual Property agreements described in the Registration Statement, the General Disclosure Package, the Statutory Prospectus
and the Prospectus are valid, binding upon, and enforceable by or against the parties thereto in accordance to its terms. The Company
and each of its subsidiaries has complied in all material respects with, and is not in breach nor has received any asserted or
threatened claim of breach of, any Intellectual Property agreement, except for any such breach that would not, singularly or in
the aggregate, have a Material Adverse Effect, and the Company has no knowledge of any breach or anticipated breach by any other
person to any Intellectual Property agreement. To the best of the Company’s knowledge, the Company’s and each of its
subsidiary’s businesses as now conducted and as proposed to be conducted does not and will not infringe or conflict with
any patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses or other intellectual property or franchise
right of any person. In the past six
years the Company has received no claim alleging the infringement by the Company or any of
its subsidiaries of any patent, trademark, service mark, trade name, copyright, trade secret, license in or other intellectual
property right or franchise right of any person. The Company and each of its subsidiaries has taken all reasonable steps to protect,
maintain and safeguard its rights in all Intellectual Property, including the execution of appropriate nondisclosure and confidentiality
agreements. The consummation of the transactions contemplated by this Agreement will not result in the loss or impairment of or
payment of any additional amounts with respect to, nor require the consent of any other person in respect of, the Company’s
or any of its subsidiaries’ right to own, use, or hold for use any of the Intellectual Property as owned, used or held for
use in the conduct of its business. The granted and issued Intellectual Property owned by the Company and its subsidiaries,
have not been adjudged by a court of competent jurisdiction invalid or unenforceable, in whole or in part, and except as otherwise
disclosed in the Registration Statement, the General Disclosure Package, the Statutory Prospectus and the Prospectus, there is
no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the validity
or scope of any such Intellectual Property nor is there any reasonable basis for such a claim. The Company and each subsidiary
has at all times complied with all applicable laws relating to privacy, data protection, and the collection and use of personal
information collected, used, or held for use by the Company or any subsidiary in the conduct of the Company’s or any subsidiary’s
business. No claims have been asserted or, to the Company’s knowledge, threatened against the Company or any subsidiary alleging
a violation of any person’s privacy or personal information or data rights and the consummation of the transactions contemplated
hereby will not breach or otherwise cause any violation of any law related to privacy, data protection, or the collection and use
of personal information collected, used, or held for use by the Company or any of its subsidiaries in the conduct of the Company’s
or any of its subsidiaries’ businesses. The Company and each of its subsidiaries take reasonable measures to ensure that
such information is protected against unauthorized access, use, modification, or other misuse. The Company is not a party to or
bound by any options, licenses or agreements with respect to the Intellectual Property of any other person or entity that are required
to be set forth in the Registration Statement, the General Disclosure Package, the Statutory Prospectus and the Prospectus and
are not described therein.
(m)
The Company and each of its subsidiaries has good and marketable title to all property owned by it, in each case free and
clear of all liens, encumbrances, claims, security interests and defects, except such as do not materially affect the value of
such property and do not materially interfere with the use made or proposed to be made of such property by the Company and its
subsidiaries. All property held under lease by the Company and its subsidiaries is held by them under valid, existing and enforceable
leases, free and clear of all liens, encumbrances, claims, security interests and defects, except such as are not material and
do not materially interfere with the use made or proposed to be made of such property by the Company and its subsidiaries.
(n)
Subsequent to the respective dates as of which information is given in the Registration Statement, the General Disclosure
Package, the Statutory Prospectus and the Prospectus, (i) there has not been any event which is reasonably likely to have a Material
Adverse Effect; (ii) neither the Company nor any of its subsidiaries has sustained any loss or interference with its assets, businesses
or properties (whether owned or leased) from fire,
explosion, earthquake, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or any court or legislative or other governmental action, order or decree which would have a Material
Adverse Effect; and (iii) since the date of the latest balance sheet included in the Registration Statement and the Prospectus
(except as disclosed in the Registration Statement and the Prospectus and the documents incorporated therein), neither the Company
nor its subsidiaries has (A) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed
money, except such issuances, liabilities or obligations incurred in the ordinary course of business, (B) entered into any transaction
not in the ordinary course of business or (C) declared or paid any dividend or made any distribution on any shares of its stock
or redeemed, purchased or otherwise acquired or agreed to redeem, purchase or otherwise acquire any shares of its capital stock.
(o)
There is no document, contract or other agreement required to be described in the Registration Statement, the General Disclosure
Package, the Statutory Prospectus or the Prospectus or to be filed as an exhibit to the Registration Statement which is not described
or filed as required by the Act or Rules. Each description of a contract, document or other agreement in the Registration Statement,
the General Disclosure Package, the Statutory Prospectus or the Prospectus accurately reflects in all material respects the terms
of the underlying contract, document or other agreement. Each contract, document or other agreement described in the Registration
Statement, the General Disclosure Package, the Statutory Prospectus or the Prospectus or listed in the exhibits to the Registration
Statement or incorporated by reference is in full force and effect and is valid and enforceable by and against the Company or its
subsidiary, as the case may be, in accordance with its terms. Neither the Company nor any of its subsidiaries, if a subsidiary
is a party, nor to the Company’s knowledge, any other party is in default in the observance or performance of any term or
obligation to be performed by it under any such agreement, and no event has occurred which with notice or lapse of time or both
would constitute such a default, in any such case which default or event, individually or in the aggregate, would have a Material
Adverse Effect. No default exists, and no event has occurred which with notice or lapse of time or both would constitute a default,
in the due performance and observance of any term, covenant or condition, by the Company or its subsidiary, if a subsidiary is
a party thereto, of any other agreement or instrument to which the Company or any of its subsidiaries is a party or by which Company
or its properties or business or a subsidiary or its properties or business may be bound or affected which default or event, individually
or in the aggregate, would have a Material Adverse Effect.
(p)
The statistical and market related data included in the Registration Statement, the General Disclosure Package, the Statutory
Prospectus or the Prospectus are based on or derived from sources that the Company believes to be reliable and accurate.
(q)
Neither the Company nor any subsidiary (i) is in violation of its certificate or articles of incorporation, by-laws, certificate
of formation, limited liability company agreement, partnership agreement or other organizational documents, (ii) is in default
under, and no event has occurred which, with notice or lapse of time, or both, would constitute a default under, or result in the
creation or imposition of any lien, charge, mortgage, pledge, security interest, claim, limitation on voting rights, equity, trust
or other encumbrance, preferential arrangement, defect or restriction of any kind whatsoever, upon, any property or assets of the
Company or any
subsidiary pursuant to, any bond, debenture, note, indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which it is a party or by which it is bound or to which any of its properties or assets is subject or (iii) is
in violation of any statute, law, rule, regulation, ordinance, directive, judgment, decree or order of any judicial, regulatory
or other legal or governmental agency or body, foreign or domestic, except (in the case of clauses (ii) and (iii) above) for violations
or defaults that could not (individually or in the aggregate) reasonably be expected to have a Material Adverse Effect.
(r)
This Agreement has been duly authorized, executed and delivered by the Company.
(s)
Neither the execution, delivery and performance of this Agreement by the Company nor the consummation of any of the transactions
contemplated hereby (including, without limitation, the issuance and sale by the Company of the Securities) will give rise to a
right to terminate or accelerate the due date of any payment due under, or conflict with or result in the breach of any term or
provision of, or constitute a default (or an event which with notice or lapse of time or both would constitute a default) under,
or require any consent or waiver under, or result in the execution or imposition of any lien, charge or encumbrance upon any properties
or assets of the Company or its subsidiaries pursuant to the terms of, any indenture, mortgage, deed of trust or other agreement
or instrument to which the Company or any of its subsidiaries is a party or by which either the Company or its subsidiaries or
any of their properties or businesses is bound, or any franchise, license, permit, judgment, decree, order, statute, rule or regulation
applicable to the Company or any of its subsidiaries or violate any provision of the charter or by-laws of the Company or any of
its subsidiaries, except for such consents or waivers which have been obtained and are in full force and effect.
(t)
The Company has authorized and outstanding capital stock as set forth under the caption “Capitalization” in
the Statutory Prospectus and the Prospectus as of the dates such information is provided. The Securities have been duly authorized
for issuance by the Company. All of the issued and outstanding shares of Common Stock have been duly and validly issued and are
fully paid and nonassessable. There are no statutory preemptive or other similar rights to subscribe for or to purchase or acquire
any shares of Common Stock of the Company or any of its subsidiaries or any such rights pursuant to its Certificate of Incorporation
or by-laws or any agreement or instrument to or by which the Company or any of its subsidiaries is a party or bound. The Shares,
when issued and sold pursuant to this Agreement, will be duly and validly issued, fully paid and nonassessable and none of them
will be issued in violation of any preemptive or other similar right. Except as disclosed in the Registration Statement, the Statutory
Prospectus and the Prospectus, there is no outstanding option, warrant or other right calling for the issuance of, and there is
no commitment, plan or arrangement to issue, any share of stock of the Company or any of its subsidiaries or any security convertible
into, or exercisable or exchangeable for, such stock. The exercise price of each option to acquire Common Stock (each, a “Company
Stock Option”) is no less than the fair market value of a share of Common Stock as determined on the date of grant of such
Company Stock Option. All grants of Company Stock Options were validly issued and properly approved by the board of directors of
the Company in material compliance with all applicable laws and the terms of the plans under which such Company Stock Options were
issued and were recorded on the Company Financial
Statements in accordance with U.S. GAAP, and no such grants involved any “back
dating”, “forward dating,” “spring loading” or similar practices with respect to the effective date
of grant. The Common Stock and the Shares conform in all material respects to all statements in relation thereto contained in the
Registration Statement and the Statutory Prospectus and the Prospectus. All outstanding shares of capital stock of each of the
Company’s subsidiaries have been duly authorized and validly issued, and are fully paid and nonassessable and are owned directly
by the Company or by another wholly-owned subsidiary of the Company free and clear of any security interests, liens, encumbrances,
equities or claims, other than those described in the Statutory Prospectus and the Prospectus.
(u)
No person or entity has any right to require, or cause the Company to effect, registration of shares of Common Stock
or other securities of the Company because of the consummation of the transactions contemplated by this Agreement, except for persons
and entities who have expressly waived such right in writing or who have been given timely and proper written notice and have failed
to exercise such right within the time or times required under the terms and conditions of such right. Each director, executive
officer and stockholder of the Company listed on Schedule III hereto has delivered to the Representative an enforceable written
lock-up agreement in the form of the Lock-Up Agreement.
(v)
There are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of
which any property of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any
of its subsidiaries, individually or in the aggregate, reasonably could result in a Material Adverse Effect; and, to the knowledge
of the Company, no such proceedings are threatened or contemplated by governmental authorities or threatened by others.
(w)
All necessary corporate action has been duly and validly taken by the Company to authorize the execution, delivery and performance
of this Agreement by the Company and the issuance and sale of the Securities by the Company.
(x)
Neither the Company nor any of its subsidiaries is involved in any labor dispute nor, to the knowledge of the Company, is
any such dispute threatened, which dispute would have a Material Adverse Effect. The Company is not aware of any existing or imminent
labor disturbance by the employees of any of its principal suppliers or contractors which would have a Material Adverse Effect.
The Company is not aware of any threatened or pending litigation between the Company or its subsidiaries and any of its executive
officers which, if adversely determined, reasonably could have a Material Adverse Effect and has no reason to believe that such
officers will not remain in the employment of the Company.
(y) No transaction has occurred between or among the Company and any of its officers or directors, stockholders or any affiliate
or affiliates of any such officer or director or stockholder that is required to be described in and is not described in the Registration
Statement, the General Disclosure Package, the Statutory Prospectus and the Prospectus.
(z)
The Company has not taken, nor will it take, directly or indirectly, any action designed to or which might reasonably be
expected to cause or result in, or which has constituted
or which might reasonably be expected to constitute, the stabilization
or manipulation of the price of the Common Stock or any security of the Company to facilitate the sale or resale of any of the
Securities.
(aa)
The Company and each of its subsidiaries has filed all federal, state, local and foreign tax returns which are required
to be filed through the date hereof, which returns are true and correct in all material respects or has received timely extensions
thereof, and has paid all taxes shown on such returns and all assessments received by it to the extent that the same are material
and have become due. There are no tax audits or investigations pending, which if adversely determined would have a Material Adverse
Effect; nor are there any material proposed additional tax assessments against the Company or any of its subsidiaries.
(bb)
The Shares and the Warrant Shares have been duly authorized for listing on NASDAQ.
(cc)
The Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act or the listing of the Common Stock (including the Shares and the Warrant Shares) on NASDAQ, nor has
the Company received any notification that the Commission or NASDAQ is contemplating terminating such registration or listing.
(dd)
The books, records and accounts of the Company and its subsidiaries accurately and fairly reflect, in all material respects,
the transactions in, and dispositions of, the assets of, and the results of operations of, the Company and its subsidiaries. The
Company and each of its subsidiaries maintains a system of internal accounting controls sufficient to provide reasonable assurances
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 accordance with U.S. 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.
(ee)
The Company has established and maintains disclosure controls and procedures (as such term is defined in Rule 13a-15 under
the Exchange Act), which: (i) are designed to ensure that material information relating to the Company is made known to the Company’s
principal executive officer and its principal financial officer by others within the Company, particularly during the periods in
which the periodic reports required under the Exchange Act are required to be prepared; (ii) provide for the periodic evaluation
of the effectiveness of such disclosure controls and procedures at the end of the periods in which the periodic reports are required
to be prepared; and (iii) except as set forth in the General Disclosure Package, are effective in all material respects to perform
the functions for which they were established.
(ff)
Based on the evaluation of its disclosure controls and procedures, the Company is not aware of (i) any material weakness
or significant deficiency in the design or operation of internal controls which could adversely affect the Company’s ability
to record, process, summarize and report financial data or any material weaknesses in internal controls; or (ii) any
fraud, whether
or not material, that involves management or other employees who have a role in the Company’s internal controls.
(gg)
Except as preapproved in accordance with the requirements set forth in Section 10A of the Exchange Act, the Auditor has
not been engaged by the Company to perform any “prohibited activities” (as defined in Section 10A of the Exchange Act).
(hh)
There are no material off-balance sheet arrangements (as defined in Item 303 of Regulation S-K) that have or are reasonably
likely to have a material current or future effect on the Company’s financial condition, revenues or expenses, changes in
financial condition, results of operations, liquidity, capital expenditures or capital resources.
(ii)
The Company’s board of directors has validly appointed an audit committee whose composition satisfies the requirements
of NASDAQ and the board of directors and/or the audit committee has adopted a charter that satisfies the requirements of NASDAQ.
The audit committee has reviewed the adequacy of its charter within the past twelve months.
(jj)
The Company is in compliance with all applicable provisions of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley
Act”), any related rules and regulations promulgated by the Commission and corporate governance requirements under applicable
NASDAQ regulations, and has no reason to believe that it will not be able to comply with such provisions. There is and has been
no failure on the part of the Company or any of its directors or officers, in their capacities as such, to comply with any provision
of the Sarbanes-Oxley Act, including, without limitation, Section 402 related to loans and Sections 302 and 906 related to certifications.
(kk)
The Company and its subsidiaries are insured by insurers of recognized financial responsibility against such losses and
risks and in such amounts as are customary in the businesses in which they are engaged or propose to engage after giving effect
to the transactions described in the Statutory Prospectus and the Prospectus; all policies of insurance and fidelity or surety
bonds insuring the Company or any of its subsidiaries or the Company’s or its subsidiaries’ respective businesses,
assets, employees, officers and directors are in full force and effect; the Company and each of its subsidiaries are in compliance
with the terms of such policies and instruments in all material respects; and neither the Company nor any subsidiary of the Company
has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or
to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that is not materially
greater than the current cost. Neither the Company nor any of its subsidiaries has been denied any insurance coverage which it
has sought or for which it has applied.
(ll)
No approval, consent, order, authorization, designation, declaration or filing of, by or with any regulatory, administrative
or other governmental body (other than FINRA and NASDAQ) is necessary in connection with the execution and delivery by the Company
of this Agreement and the consummation of the transactions herein contemplated.
(mm)
There are no affiliations with FINRA among the Company’s officers, directors or, to the best of the knowledge of the
Company, any five percent or greater stockholder of the Company, except as set forth in the Registration Statement or otherwise
disclosed in writing to the Representative.
(nn)
The Company does not expect to be a Passive Foreign Investment Company (“PFIC”) within the meaning of Section 1297(a)
of the United States Internal Revenue Code of 1986, as amended, and the regulations and published interpretations thereunder for
the year ending December 31, 2018, and has no plan or intention to conduct its business in a manner that would be reasonably
expected to result in the Company becoming a PFIC in the future under current laws and regulations.
(oo)
(i) Each of the Company and each of its subsidiaries is in compliance in all material respects with all rules, laws and
regulation relating to the use, treatment, storage and disposal of toxic substances and protection of health or the environment
(“Environmental Laws”) which are applicable to its business; (ii) neither the Company nor its subsidiaries has received
any notice from any governmental authority or third party of an asserted claim under Environmental Laws; (iii) each of the Company
and each of its subsidiaries has received all permits, licenses or other approvals required of it under applicable Environmental
Laws to conduct its business and is in compliance in all material respects with all terms and conditions of any such permit, license
or approval; (iv) to the Company’s knowledge, no facts currently exist that will require the Company or any of its subsidiaries
to make future material capital expenditures to comply with Environmental Laws; and (v) no property which is or has been owned,
leased or occupied by the Company or its subsidiaries has been designated as a Superfund site pursuant to the Comprehensive Environmental
Response, Compensation of Liability Act of 1980, as amended (42 U.S.C. Section 9601, et. seq.) (“CERCLA 1980”) or otherwise
designated as a contaminated site under applicable state or local law. Neither the Company nor any of its subsidiaries has been
named as a “potentially responsible party” under CERCLA 1980.
(pp)
In the ordinary course of its business, the Company periodically reviews the effect of Environmental Laws on the business,
operations and properties of the Company and its subsidiaries, in the course of which the Company identifies and evaluates associated
costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties
or compliance with Environmental Laws, or any permit, license or approval, any related constraints on operating activities and
any potential liabilities to third parties). On the basis of such review, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate, have a Material Adverse Effect.
(qq)
The Company is not and, after giving effect to the offering and sale of the Securities and the application of proceeds thereof
as described in the Statutory Prospectus and the Prospectus, will not be an “investment company” within the meaning
of the Investment Company Act of 1940, as amended (the “Investment Company Act”).
(rr)
The Company or, to the knowledge of the Company, any other person associated with or acting on behalf of the Company including,
without limitation, any director, officer, agent or employee of the Company or its subsidiaries, has not, directly or indirectly,
while acting on behalf of the Company or its subsidiaries (i) used any corporate funds for unlawful contributions, gifts, entertainment
or other unlawful expenses relating to political activity; (ii) made any unlawful payment to foreign or domestic government
officials or employees or to foreign or domestic political parties or campaigns from corporate funds; (iii) violated any provision
of the Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any other unlawful payment.
(ss)
The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable
financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations
or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”)
and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving
the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending, or to the best knowledge of the Company,
threatened.
(tt)
Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee
or affiliate of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of
Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly use
the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner
or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered
by OFAC.
(uu)
Except as described in the Statutory Prospectus and the Prospectus, the Company has not sold or issued any shares of Common
Stock during the six-month period preceding the date of the Prospectus, including any sales pursuant to Rule 144A under, or Regulations
D or S of, the Act, other than shares issued pursuant to employee benefit plans, qualified stock options plans or other employee
compensation plans or pursuant to outstanding options, rights or warrants.
(vv) The Company has fulfilled its obligations, if any, in all material respects under the minimum funding standards of Section
302 of the U.S. Employee Retirement Income Security Act of 1974 (“ERISA”) and the regulations and published interpretations
thereunder with respect to each “plan” as defined in Section 3(3) of ERISA and such regulations and published interpretations
in which its employees are eligible to participate and each such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published interpretations. No “Reportable Event” (as defined
in 12 ERISA) has occurred with respect to any “Pension Plan” (as defined in ERISA) for which the Company could have
any liability.
(ww)
None of the Company, its directors or its officers has distributed nor will distribute prior to the later of (i) the Closing
Date, or the Additional Closing Date, and (ii) completion of the distribution of the Securities, any offering material in connection
with the offering and sale of the Securities other than any Preliminary Prospectus, the Prospectus, the Registration Statement
and other materials, if any, permitted by the Act and consistent with Section 9(b) below.
(xx)
Except as described in the Registration Statement, the General Disclosure Package, the Statutory Prospectus or the Prospectus,
and except as would not, individually or in the aggregate, result in a Material Adverse Effect: (i) the Company and its subsidiaries,
including U.S. Compounding, Inc. (“USC”) are and have been in compliance with all statutes, laws, ordinances, rules
and regulations applicable to the operation and business of the Company and its subsidiaries including, but not limited to those
for the ownership, testing, development, manufacture, packaging, processing, use, labeling, storage, or disposal of any product
manufactured by or on behalf of the Company, or compounded by USC, including without limitation, the Federal Food, Drug, and Cosmetic
Act, 21 U.S.C. § 301, et seq., and the amendments thereto under the Drug Quality and Security Act (the “FDCA”),
the Controlled Substances Act, 21 U.S.C. § 801, et seq. (the “CSA”), and similar laws of other governmental entities
and the regulations promulgated pursuant to such laws (collectively, “Applicable Laws”); (ii) neither the Company nor
its subsidiaries have received any written notice of adverse finding, warning letter or other written correspondence or notice
from the U.S. Food and Drug Administration (“FDA”) or any other governmental entity alleging or asserting noncompliance
with any Applicable Laws except as disclosed by the Company to the Underwriters; (iii) the Company has not received written notice
of any ongoing claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any governmental
entity or third party alleging that any product, operation or activity is in violation of any Applicable Laws or has any knowledge
that any such governmental entity or third party is considering any such claim, litigation, arbitration, action, suit, investigation
or proceeding, nor, to the best of the Company’s knowledge, has there been any noncompliance with or violation of any Applicable
Laws by the Company or its subsidiaries that could reasonably be expected to require the issuance of any such written notice or
result in an investigation, corrective action, or enforcement action by the FDA or similar governmental entity; (iv) neither the
Company nor its subsidiaries has received written notice that any governmental entity has taken, is taking or intends to take action
to limit, suspend, modify or revoke any Permits or has any knowledge that any such governmental entity has threatened or is considering
such action; and (v) the Company and its subsidiaries have filed, obtained, maintained or submitted all reports, documents, forms,
notices, applications, records, claims, submissions and supplements or amendments as required by any Applicable Laws and that all
such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were complete,
correct and not misleading on the date filed (or were corrected or supplemented by a subsequent submission). Neither the Company,
its subsidiaries and, to the Company’s knowledge, any of its directors, officers, employees or agents, has made, or caused
the making of, any false statements on, or material omissions from, any other records or documentation prepared or maintained to
comply with the requirements of the FDA or any other governmental entity.
The clinical trials
and other studies conducted by the Company or its subsidiaries, or to
the knowledge of the Company, on behalf of the Company, have
been and, if still pending, are being conducted in all material respects pursuant to all Applicable Laws; the descriptions of the
results of such clinical trials and other studies contained in the Registration Statement, the General Disclosure Package, the
Statutory Prospectus or the Prospectus are accurate and complete in all material respects and fairly present the data derived from
such clinical trials and other studies; except to the extent disclosed in the Registration Statement, the General Disclosure Package,
the Statutory Prospectus or the Prospectus, the Company is not aware of any clinical trials or other studies, the results of which
the Company believes reasonably call into question the research, nonclinical study results or clinical trial results described
or referred to in the Registration Statement, the General Disclosure Package, the Statutory Prospectus or the Prospectus when viewed
in the context in which such results are described; and the Company has not received any written notices or other correspondence
from any governmental entity requiring the termination, suspension or material modification of any clinical trial or other study
conducted by or on behalf of the Company.
(yy) Compliance with Health Care Laws. The Company’s and its subsidiaries’ business practices have been structured
in a manner reasonably designed to comply with the federal and state health care laws applicable to the respective businesses of
the Company and its subsidiaries, and the Company and its subsidiaries are in compliance with all applicable Health Care Laws,
except where the failure to do so would not reasonably be expected to have a Material Adverse Effect. For purposes of this Agreement,
“Health Care Laws” means: (i) the FDCA and the CSA, and the regulations promulgated thereunder; (ii) all
applicable federal, state, and local health care related fraud and abuse laws, including, without limitation, the U.S. Anti-Kickback
Statute (42 U.S.C. Section 1320a-7b(b)), the U.S. Physician Payments Sunshine Act (42 U.S.C. § 1320a-7h), the U.S. civil
False Claims Act (31 U.S.C. Section 3729 et seq.), the criminal false claims Law (42 U.S.C. § 1320a-7b(a)), 18 U.S.C.
Sections 286 and 287, the health care fraud criminal provisions under the U.S. Health Insurance Portability and Accountability
Act of 1996 (“HIPAA”) (42 U.S.C. Section 1320d et seq.), the exclusion laws (42 U.S.C. § 1320a-7) and the
civil monetary penalties law (42 U.S.C. § 1320a-7a); (iii) HIPAA, as amended by the Health Information Technology for Economic
and Clinical Health Act (42 U.S.C. Section 17921 et seq.), and the regulations promulgated pursuant to such statutes; (iv) the
Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the Health Care and Education Reconciliation Act
(Public Law 111-152; (v) Medicare (Title XVIII of the Social Security Act); (vi) Medicaid (Title XIX of the Social Security
Act); and (vii) any and all other applicable health care laws and regulations. Neither the Company nor, to the knowledge of
the Company, any of its subsidiaries has received written notice of any claim, action, suit, proceeding, hearing, enforcement,
investigation, arbitration or other action from any court or arbitrator or governmental or regulatory authority or third party
alleging that any product operation or activity is in material violation of any Health Care Laws, and, to the Company’s knowledge,
no such claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action is threatened. To the
Company’s knowledge, neither the Company nor any of its subsidiaries have engaged in activities that are, as applicable,
cause for false claims liability, civil penalties, or mandatory or permissive exclusion from Medicare, Medicaid, or any other state
health care program or federal health care program. Neither the Company nor any of its subsidiaries is a party to or has
any ongoing reporting obligations pursuant to any corporate integrity agreements, deferred prosecution agreements, monitoring agreements,
consent decrees,
settlement orders, plans of correction or similar agreements with or imposed by any governmental or regulatory
authority. Additionally, none of the Company, its subsidiaries or any of their respective employees, officers or directors has
been excluded, suspended or debarred from participation in any U.S. federal health care program or human clinical research or,
to the knowledge of the Company, is subject to a governmental inquiry, investigation, proceeding, or other similar action that
could reasonably be expected to result in debarment, suspension, or exclusion
7.
Expenses. Whether or not the transactions contemplated hereby are consummated or this Agreement becomes effective
or is terminated, the Company agrees to pay or cause to be paid the following: (i) the fees, disbursements and expenses of the
Company’s counsel and accountants in connection with the registration of the Shares and Warrant Shares under the Act and
all other expenses in connection with the preparation, printing and filing of the Registration Statement and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies thereof and of any Preliminary Prospectus to the Underwriters
and dealers; (ii) the printing and delivery (including postage, air freight charges and charges for counting and packaging) of
such copies of the Registration Statement, the Prospectus, each Preliminary Prospectus, the General Disclosure Package, the Blue
Sky memoranda, the Master Agreement Among Underwriters, this Agreement, the Selected Dealers Agreement and all amendments or supplements
to any of them as may be reasonably requested for use in connection with the offering and sale of the Securities; (iii) consistent
with the provisions of Section 5(i), all expenses (subject to the limits set forth in the penultimate sentence in Section 7 below)
in connection with the qualification of the Securities for offering and sale under state securities laws or Blue Sky laws, including
reasonable attorneys’ fees and out-of-pocket expenses of the counsel for the Underwriters in connection therewith; (iv) the
filing fees incident to securing any required review by FINRA of the fairness of the terms of the sale of the Securities and the
reasonable fees and disbursements of the Underwriters’ counsel relating thereto; (v) the fees and expenses associated with
including the Shares and Warrant Shares on NASDAQ; (vi) the cost of preparing stock certificates and Warrants; (vii) the costs
and charges of any transfer agent or registrar; (viii) the cost of the tax stamps, if any, in connection with the issuance and
delivery of the Securities to the respective Underwriters; (ix) all other fees, costs and expenses referred to in Item 13 of the
Registration Statement; and (x) the transportation, lodging, graphics and other expenses incidental to the Company’s preparation
for and participation in the “roadshow” for the offering contemplated hereby. Except as provided in this Section 7
and in Section 8 hereof, the Underwriters shall pay their own expenses, including the fees and disbursements of their counsel,
and the Company shall reimburse the Underwriters for out-of-pocket costs and expenses (a) unrelated to outside attorneys fees in
an amount not to exceed $15,000 and (b) legal expenses in an amount not to exceed $85,000. In addition, in the event that the proposed
offering is terminated for the reasons set forth in Section 5(l) hereof, the Company agrees to reimburse the Underwriters as provided
in Section 5(l).
8.
Indemnification and Contribution. Subject to the limitations in this paragraph below, the Company agrees to indemnify
and hold harmless you and each other Underwriter, the directors, officers, employees and agents of each Underwriter, and each person,
if any, who controls any Underwriter within the meaning of Section 15 of the Act or Section 20 of the Exchange Act from and against
any and all losses, claims, damages, liabilities and expenses,
including reasonable costs of investigation and attorneys’
fees and expenses (collectively, “Damages”) arising out of or based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, in the Registration Statement, the General Disclosure Package,
any Issuer Free Writing Prospectus or the Prospectus or in any amendment or supplement thereto, or any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of the
Prospectus, in light of the circumstances under which they were made) not misleading, except to the extent that any such Damages
arise out of or are based upon an untrue statement or omission or alleged untrue statement or omission that has been made therein
or omitted therefrom in reliance upon and in conformity with the information furnished in writing to the Company by or on behalf
of any Underwriter through you, expressly for use in connection therewith or (ii) any inaccuracy in or breach of the representations
and warranties of the Company contained herein or any failure of the Company to perform its obligations hereunder or under law;
provided, however, that with respect to any untrue statement or omission made in any Preliminary Prospectus, the indemnity agreement
contained in this paragraph shall not inure to the benefit of any Underwriter (or to the benefit of any person controlling such
Underwriter or to any officer, director, employee or agent of any Underwriter) from whom the person asserting any such Damages
purchased the Securities concerned if both (A) a copy of the General Disclosure Package was not sent or given to such person at
or prior to the written confirmation of the sale of such Securities to such person as required by the Act and (B) the untrue statement
or omission in the Preliminary Prospectus was corrected in the General Disclosure Package. This indemnification shall be in addition
to any liability that the Company may otherwise have.
In addition to its
other obligations under this Section 8, the Company agrees that, as an interim measure during the pendency of any claim, action,
investigation, inquiry or other proceeding arising out of or based upon any statement or omission, or any inaccuracy in the representations
and warranties of the Company herein or failure to perform its obligations hereunder, all as set forth in this Section 8, the party
against whom indemnification is being sought will reimburse each Underwriter on a monthly basis for all reasonable legal or other
out-of-pocket expenses incurred in connection with investigating or defending any such claim, action, investigation, inquiry or
other proceeding (to the extent documented by reasonably itemized invoices therefor), notwithstanding the absence of a judicial
determination as to the propriety and enforceability of the obligation of the Company to reimburse each Underwriter for such expenses
and the possibility that such payments might later be held to have been improper by a court of competent jurisdiction. To the extent
that any such interim reimbursement payment is so held to have been improper, each Underwriter shall promptly return it to the
person(s) from whom it was received. Any such interim reimbursement payments that are not made to the Underwriters within 30 days
of a request for reimbursement shall bear interest compounded daily at a rate determined on the basis of the base lending rate
announced from time to time by The Wall Street Journal from the date of such request.
If any action or
claim shall be brought against any Underwriter or any person controlling any Underwriter in respect of which indemnity may be sought
against the Company, such Underwriter or such controlling person shall promptly notify in writing the party(s) against whom indemnification
is being sought (the “indemnifying party” or “indemnifying parties”), and such indemnifying party(s) shall
assume the defense thereof, including the employment of
counsel reasonably acceptable to such Underwriter or such controlling person
and the payment of all reasonable fees of and expenses incurred by such counsel. Such Underwriter or any such controlling person
shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Underwriter or such controlling person, unless (i) the indemnifying party(s) has
(have) agreed in writing to pay such fees and expenses, (ii) the indemnifying party(s) has (have) failed to assume the defense
and employ counsel reasonably acceptable to the Underwriter or such controlling person or (iii) the named parties to any such action
(including any impleaded parties) include both such Underwriter or such controlling person and the indemnifying party(s), and such
Underwriter or such controlling person shall have been advised by its counsel that one or more legal defenses may be available
to the Underwriter that may not be available to the Company, or that representation of such indemnified party and any indemnifying
party(s) by the same counsel would be inappropriate under applicable standards of professional conduct (whether or not such representation
by the same counsel has been proposed) due to actual or potential differing interests between them (in which case the indemnifying
party(s) shall not have the right to assume the defense of such action on behalf of such Underwriter or such controlling person
(but the Company shall not be liable for the fees and expenses of more than one counsel for the Underwriters and such controlling
persons)). The indemnifying party(s) shall not be liable for any settlement of any such action effected without its (their several)
written consent, but if settled with such written consent, or if there be a final judgment for the plaintiff in any such action,
the indemnifying party(s) agree(s) to indemnify and hold harmless any Underwriter and any such controlling person from and against
any loss, claim, damage, liability or expense by reason of such settlement or judgment, but in the case of a judgment only to the
extent stated in the first paragraph of this Section 8.
Each Underwriter
agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration
Statement and any person who controls the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
to the same extent as the foregoing several indemnity from the Company to each Underwriter, but only with respect to information
furnished in writing by or on behalf of such Underwriter through you expressly for use in the Registration Statement, the Prospectus,
the General Disclosure Package, any Issuer Free Writing Prospectus or any Preliminary Prospectus, or any amendment or supplement
thereto. If any action or claim shall be brought or asserted against the Company, any of its directors, any of its officers or
any such controlling person based on the Registration Statement, the Prospectus, the General Disclosure Package or any Preliminary
Prospectus, or any amendment or supplement thereto, and in respect of which indemnity may be sought against any Underwriter pursuant
to this paragraph, such Underwriter shall have the rights and duties given to the Company by the immediately preceding paragraph
(except that if the Company shall have assumed the defense thereof such Underwriter shall not be required to do so, but may employ
separate counsel therein and participate in the defense thereof, but the fees and expenses of such counsel shall be at such Underwriter’s
expense), and the Company, its directors, any such officers and any such controlling persons, shall have the rights and duties
given to the Underwriters by the immediately preceding paragraph.
In any event, the Company
will not, without the prior written consent of the
Representative, settle or compromise or consent to the entry of any judgment
in any proceeding or threatened claim, action, suit or proceeding in respect of which the indemnification may be sought hereunder
(whether or not the Representative or any person who controls the Representative within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act is a party to such claim, action, suit or proceeding) unless such settlement, compromise or consent
includes an unconditional release of all Underwriters and such controlling persons from all liability arising out of such claim,
action, suit or proceeding.
If the indemnification
provided for in this Section 8 is unavailable or insufficient for any reason whatsoever to an indemnified party in respect of any
Damages referred to herein, then an indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such Damages (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand, and the Underwriters on the other hand, from the offering and sale
of the Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative and several fault
of the Company on the one hand, and the Underwriters on the other hand, in connection with the statements or omissions that resulted
in such Damages as well as any other relevant equitable considerations. The relative and several benefits received by the Company
on the one hand, and the Underwriters on the other hand, shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the cover page of the Prospectus; provided that, in the
event that the Underwriters shall have purchased any Additional Securities hereunder, any determination of the relative benefits
received by the Company or the Underwriters from the offering of the Securities shall include the net proceeds (before deducting
expenses) received by the Company and the underwriting discounts and commissions received by the Underwriters, from the sale of
such Additional Securities, in each case computed on the basis of the respective amounts set forth in the notes to the table on
the cover page of the Prospectus. The relative fault of the Company on the one hand, and the Underwriters on the other hand, shall
be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to information supplied by the Company on the one hand, or by the Underwriters
on the other hand and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the
Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 8 was determined by a pro rata
allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does
not take into account the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable
by an indemnified party as a result of the Damages referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, no Underwriter shall
be required to contribute
any amount in excess of the amount of the underwriting commissions received by such underwriter in connection
with the Securities underwritten by it and distributed to the public. 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. The Underwriters’ obligations to contribute pursuant to this Section 8 are several in proportion to the
respective numbers of Firm Securities set forth opposite their names in Schedule I hereto (or such numbers of Firm Securities increased
as set forth in Section 10 hereof) and not joint.
Notwithstanding the
second paragraph of this Section 8, any Damages for which an indemnified party is entitled to indemnification or contribution under
this Section 8 shall be paid by the indemnifying party to the indemnified party as Damages are incurred after receipt of reasonably
itemized invoices therefor. The indemnity, contribution and reimbursement agreements contained in this Section 8 and the representations
and warranties of the Company set forth in this Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any person controlling any Underwriter, the Company, its directors
or officers or any person controlling the Company, (ii) acceptance of any Securities and payment therefor hereunder and (iii) any
termination of this Agreement. A successor to any Underwriter or any person controlling any Underwriter, or to the Company, its
directors or officers or any person controlling the Company, shall be entitled to the benefits of the indemnity, contribution and
reimbursement agreements contained in this Section 8.
It is agreed that any
controversy arising out of the operation of the interim reimbursement arrangements set forth in the second paragraph of this Section
8, including the amounts of any requested reimbursement payments and the method of determining such amounts, shall be settled by
arbitration conducted pursuant to the Code of Arbitration Procedure of FINRA. Any such arbitration must be commenced by service
of a written demand for arbitration or written notice of intention to arbitrate, therein electing the arbitration tribunal. In
the event the party demanding arbitration does not make such designation of an arbitration tribunal in such demand or notice, then
the party responding to said demand or notice is authorized to do so. Such arbitration would be limited to the operation of the
interim reimbursement provisions contained in the second and fourth paragraphs of this Section 8, and would not resolve the ultimate
propriety or enforceability of the obligation to reimburse expenses that is created by the provisions of the second paragraph of
this Section 8.
9.
Conditions of Underwriters’ Obligations. The several obligations of the Underwriters to purchase the Firm Securities
hereunder are subject to the following conditions:
(a)
All filings required by Rules 424(b), 430A and 462 under the Act shall have been timely made.
(b)
You shall have received on the Closing Date and on each Additional Closing Date a certificate, addressed to the Representative
and dated such Closing Date or Additional Closing Date, as the case may be, of the chief executive or chief operating officer and
the chief financial officer or chief accounting officer of the Company to the effect that: (i) the representations, warranties
and agreements of the Company in this Agreement were true and correct when made and are true and correct as of such date, except
for representations and warranties that speak solely as to an earlier date, which shall be true and correct as of such earlier
date; (ii) the Company has performed all covenants and agreements and satisfied all conditions contained herein, in each case,
as required to be performed or satisfied by it at or before such date; (iii) they have carefully examined the Registration Statement,
the Prospectus, the General Disclosure Package, and any individual Issuer Free Writing Prospectus and, in their opinion (A) as
of the Effective Time, the Registration Statement and Prospectus did not include, and as of the Effective Time, neither (i) the
General Disclosure Package, nor (ii) any individual Issuer Free Writing Prospectus, when considered together with the General Disclosure
Package, included, any untrue statement of a material fact and did not omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (B)
since the Effective Time no event has occurred which should have been set forth in a supplement or otherwise required an amendment
to the Registration Statement, the Statutory Prospectus or the Prospectus; and (iv) no stop order suspending the effectiveness
of the Registration Statement has been issued and, to their knowledge, no proceedings for that purpose have been instituted or
are pending under the Act.
(c)
You shall be reasonably satisfied that since the respective dates as of which information is given in the Registration Statement,
the General Disclosure Package and Prospectus, (i) there shall not have been any change in the capital stock of the Company or
any material change in the indebtedness (other than in the ordinary course of business) of the Company, (ii) except as set forth
or contemplated by the Registration Statement, the General Disclosure Package or the Prospectus, no material oral or written agreement
or other material transaction shall have been entered into by the Company that is not in the ordinary course of business or that
could reasonably be expected to result in a material reduction in the future earnings of the Company, (iii) no loss or damage (whether
or not insured) to the property of the Company shall have been sustained that had or could reasonably be expected to have a Material
Adverse Effect, (iv) no legal or governmental action, suit or proceeding affecting the Company or any of its properties that is
material to the Company or that affects or could reasonably be expected to affect the transactions contemplated by this Agreement
shall have been instituted or threatened and (v) there shall not have been any material change in the condition (financial or otherwise),
business, management, results of operations or prospects of the Company or its subsidiaries that makes it impractical or inadvisable
in your judgment to proceed with the public offering or purchase of the Securities as contemplated hereby.
(d)
You shall have received on the Closing Date or Additional Closing Date, as the case may be, an opinion of Weintraub Tobin
Chediak Coleman Grodin, counsel to the Company, in the form reasonably satisfactory to the Representative.
(e)
You shall have received on the Closing Date or Additional Closing Date, as the case may be, an opinion of K&L Gates
LLP, intellectual property counsel to the Company, in the form reasonably satisfactory to the Representative.
(f)
You shall have received on the Closing Date or Additional Closing Date, as the case may be, an opinion of Mintz, Levin,
Cohn, Ferris, Glovsky and Popeo, P.C., in the form reasonably satisfactory to the Representative.
(g)
You shall have received letters addressed to you and dated the date hereof and the Closing Date or the Additional Closing
Date, as the case may be, from the Auditor, substantially in the forms heretofore approved by you.
(h)
(i) No stop order suspending the effectiveness of the Registration Statement shall have been issued by the Commission and
no proceedings for that purpose shall be pending or, to the knowledge of the Company, shall be threatened or contemplated by the
Commission at or prior to the Closing Date or Additional Closing Date, as the case may be; (ii) no order suspending the effectiveness
of the Registration Statement or the qualification or registration of the Securities under the securities or Blue Sky laws of any
jurisdiction shall be in effect and no proceeding for such purpose shall be pending or, to the knowledge of the Company, threatened
or contemplated by the authorities of any jurisdiction; (iii) any request for additional information on the part of the staff of
the Commission or any such authorities shall have been complied with to the satisfaction of the staff of the Commission or such
authorities; (iv) after the date hereof, no amendment or supplement to the Registration Statement or the Prospectus shall have
been filed unless a copy thereof was first submitted to you and you did not object thereto in good faith; and (v) all of the representations
and warranties of the Company contained in this Agreement shall be true and correct in all material respects (except for such representations
and warranties qualified by materiality, which representations and warranties shall be true and correct in all respects) on and
as of the date hereof and on and as of the Closing Date or Additional Closing Date, as the case may be, as if made on and as of
the Closing Date or Additional Closing Date, as the case may be.
(i)
The Company shall not have failed in any material respect at or prior to the Closing Date or the Additional Closing Date,
as the case may be, to have performed or complied with any of its agreements herein contained and required to be performed or complied
with by it hereunder at or prior to the Closing Date or Additional Closing Date, as the case may be.
(j)
The Company shall have furnished or caused to have been furnished to you such further certificates and documents as you
shall have reasonably requested.
(k)
At or prior to the Closing Date, you shall have received the written commitment Lock-Up Agreements from each of the Company’s
officers and directors not to directly or indirectly (i) sell, offer or contract to sell or otherwise dispose of or transfer any
shares of Company Securities (as defined in such Lock-Up Agreements), whether now owned or acquired after the date of the Prospectus
or with respect to which the power of disposition is acquired after the date of the Prospectus, or file any registration statement
under the Act with respect to the foregoing or (ii) enter into any swap or other agreement or any other agreement that transfers,
in whole or in part, directly or indirectly, the economic consequences of ownership of Company Securities whether any such swap
or transaction is to be settled by delivery of
Company Securities, in cash or otherwise; other than as provided in such written
commitment before the expiration of 60 days from the Closing Date, without the prior written consent of Raymond James & Associates,
Inc.
(l) At or prior to the effective date of the Registration Statement, you shall have received a letter from the Corporate Financing
Department of FINRA confirming that such Department has determined to raise no objections with respect to the fairness or reasonableness
of the underwriting terms and arrangements of the offering contemplated hereby.
(m) The Shares and Warrant Shares shall have been approved for listing on NASDAQ.
(n) The Representative shall have received on the Closing Date or Additional Closing Date, as the case may be, a Secretary’s
Certificate of the Company.
(o) The Representative shall have received on the Closing Date or Additional Closing Date, as the case may be, a certificate
addressed to the Representative of the Company’s Senior Vice President of Corporate Development and Chief Medical Officer,
in a form reasonably satisfactory to the Representative with respect to the regulatory affairs of the Company.
All such opinions,
certificates, letters and other documents will be in compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and your counsel.
The several obligations
of the Underwriters to purchase Additional Securities hereunder are subject to the satisfaction on and as of the Additional Closing
Date of the conditions set forth in this Section 9, except that, if the Additional Closing Date is other than the Closing Date,
the certificates, opinions and letters referred to in this Section 9 shall be dated as of the Additional Closing Date and the opinions
called for by paragraphs (d), (e) and (f) shall be revised to reflect the sale of Additional Securities.
If any of the conditions
hereinabove provided for in this Section 9 shall not have been satisfied when and as required by this Agreement, this Agreement
may be terminated by you by notifying the Company of such termination in writing or by telegram at or prior to such Closing Date,
but you shall be entitled to waive any of such conditions.
10. Effective Date of Agreement. This Agreement shall become effective upon the execution and delivery hereof by the
parties hereto; provided, however, that the provisions of Sections 7 and 8 shall survive the termination of this Agreement.
11. Defaulting Underwriters. If any one or more of the Underwriters shall fail or refuse to purchase Firm Securities
that it or they have agreed to purchase hereunder, and the aggregate number of Firm Securities that such defaulting Underwriter
or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Firm
Securities,
each non-defaulting Underwriter shall be obligated, severally, in the proportion in which the number of Firm Securities set forth
opposite its name in Schedule I hereto bears to the aggregate number of Firm Securities set forth opposite the names of all non-defaulting
Underwriters or in such other proportion as you may specify in the Agreement Among Underwriters, to purchase the Firm Securities
that such defaulting Underwriter or Underwriters agreed, but failed or refused to purchase. If any Underwriter or Underwriters
shall fail or refuse to purchase Firm Securities and the aggregate number of Firm Securities with respect to which such default
occurs is more than one-tenth of the aggregate number of Firm Securities and arrangements satisfactory to you and the Company for
the purchase of such Firm Securities are not made within 48 hours after such default, this Agreement will terminate without liability
on the part of any non-defaulting Underwriter or the Company. In any such case that does not result in termination of this Agreement,
either you or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven (7) days, in
order that the required changes, if any, in the Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of
any such default of any such Underwriter under this Agreement.
12.
Termination of Agreement. This Agreement shall be subject to termination in your absolute discretion, without liability
on the part of any Underwriter to the Company by notice to the Company, if prior to the Closing Date or the Additional Closing
Date (if different from the Closing Date and then only as to the Additional Securities), as the case may be, in your sole judgment,
(i) trading in the Company’s Common Stock shall have been suspended by the Commission or NASDAQ, (ii) trading in securities
generally on the NYSE or NASDAQ shall have been suspended or materially limited, or minimum or maximum prices shall have been generally
established on such exchange, or additional material governmental restrictions, not in force on the date of this Agreement, shall
have been imposed upon trading in securities generally by any such exchange or by order of the Commission or any court or other
governmental authority, (iii) a general moratorium on commercial banking activities shall have been declared by either federal
or New York State authorities or (iv) there shall have occurred any outbreak or escalation of hostilities or other international
or domestic calamity, crisis or change in political, financial or economic conditions or other material event the effect of which
on the financial markets of the United States is such as to make it, in your judgment, impracticable or inadvisable to market the
Securities or to enforce contracts for the sale of the Securities. Notice of such cancellation shall be promptly given to the Company
and its counsel by telegraph, telecopy or telephone and shall be subsequently confirmed by letter.
13. Information
Furnished by the Underwriters. The Company acknowledges that that the 4th, 12th, 13th, 14th, 15th, and
16th paragraph under the caption “Underwriting” in any Preliminary Prospectus, constitutes the only
information furnished by or on behalf of the Underwriters through you or on your behalf as such information is referred to in
Sections 6(a), 6(b) and 8 hereof (the “Underwriter Information”).
14.
Miscellaneous. Except as otherwise provided in Sections 5 and 12 hereof, notice given pursuant to any of the provisions
of this Agreement shall be in writing and shall be
delivered
Adamis
Pharmaceuticals Corporation
11682
El Camino Real, Suite 300
San
Diego, California 92130
Attention:
Dennis J. Carlo
with
a copy to
Weintraub
Tobin Chediak Coleman Grodin
400 Capitol Mall, 11th Floor
Sacramento, CA 95814
Attention: C.
Kevin Kelso, Esq.
Raymond James & Associates, Inc.
880 Carillon
Parkway
St. Petersburg,
Florida 33716
Attention: Managing
Director, Legal
with a copy to
Mintz, Levin,
Cohn, Ferris, Glovsky and Popeo, P.C.
666 Third Avenue
New York, New
York 10017
Attention: Ivan
K. Blumenthal, Esq.
This Agreement has
been and is made solely for the benefit of the several Underwriters, the Company and its directors and officers.
15.
Applicable Law; Counterparts. This Agreement shall be governed by and construed in accordance with the laws of the
State of New York without reference to choice of law principles thereunder.
This Agreement may
be signed in various counterparts, which together shall constitute one and the same instrument.
This Agreement shall
be effective when, but only when, at least one counterpart hereof shall have been executed on behalf of each party hereto.
The Company and the
Underwriters each hereby irrevocably waive any right they may have to a trial by jury in respect to any claim based upon or arising
out of this Agreement or the
transactions contemplated hereby.
16.
No Fiduciary Duty. Notwithstanding any pre-existing relationship, advisory or otherwise, between the parties or any
oral representations or assurances previously or subsequently made by any of the Underwriters, the Company acknowledges and agrees
that (i) nothing herein shall create a fiduciary or agency relationship between the Company, on the one hand, and the Underwriters,
on the other hand; (ii) the Underwriters have been retained solely to act as underwriters and are not acting as advisors, expert
or otherwise, to either the Company in connection with this offering, the sale of the Securities or any other services the Underwriters
may be deemed to be providing hereunder, including, without limitation, with respect to the public offering price of the Securities;
(iii) the relationship between the Company, on the one hand, and the Underwriters, on the other hand, is entirely and solely commercial,
and the price of the Securities was established by the Company and the Underwriters based on discussions and arms’ length
negotiations and the Company understands and accepts the terms, risks and conditions of the transactions contemplated by this Agreement;
(iv) any duties and obligations that the Underwriters may have to the Company shall be limited to those duties and obligations
specifically stated herein; and (v) notwithstanding anything in this Agreement to the contrary, the Company acknowledges that the
Underwriters may have financial interests in the success of the Offering that are not limited to the difference between the price
to the public and the purchase price paid to the Company for the shares and such interests may differ from the interests of the
Company, and the Underwriters have no obligation to disclose, or account to the Company for any benefit they may derive from such
additional financial interests. The Company hereby waives and releases, to the fullest extent permitted by the applicable law,
any claims it may have against the Underwriters with respect to any breach or alleged breach of fiduciary duty and agrees that
the Underwriters shall have no liability (whether direct or indirect) to the Company in respect of such a fiduciary duty claim
or to any person asserting a fiduciary duty claim on behalf of or in right of the Company or any of its shareholders, managers,
employees or creditors.
17.
Research Analyst Independence. The Company acknowledges that (a) the Underwriters’ research analysts and research
departments are required to be independent from their respective investment banking divisions and are subject to certain regulations
and internal policies and (b) the Underwriters’ research analysts may hold views and make statements or investment recommendations
and/or publish research reports with respect to the Company, the value of the Common Stock and/or the offering that differ from
the views of their respective investment banking divisions. The Company hereby waives and releases, to the fullest extent permitted
by law, any claims that it may have against the Underwriters with respect to any conflict of interest that may arise from the fact
that the views expressed by the Underwriters’ independent research analysts and research departments may be different from
or inconsistent with the views or advice communicated to the Company by any Underwriter’s investment banking division. The
Company acknowledges that each of the Underwriters is a full service securities firm and as such, from time to time, subject to
applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short
positions in debt or equity securities of the companies that are the subject of the transactions contemplated by this Agreement.
[Signature Page to Follow]
Please confirm that the foregoing correctly sets forth the agreement among the Company and the several Underwriters.
| |
Very truly yours, |
| |
|
|
| |
ADAMIS PHARMACEUTICALS CORPORATION |
| |
|
| |
/s/ Dennis J. Carlo |
|
| |
Name: Dennis J. Carlo |
|
| |
Title: President and Chief Executive Officer |
|
CONFIRMED as of the date first above
mentioned, on behalf of the Representative
and the other several Underwriters named
in
Schedule I hereto.
| RAYMOND JAMES & ASSOCIATES, INC. |
|
| |
|
|
| |
|
|
| By: |
/s/ Edward Newman |
|
| |
Authorized
Representative |
|
SCHEDULE I
| Name |
|
Number of Firm Shares |
|
Number of Firm Warrants |
| Raymond James & Associates, Inc. |
|
10,800,000 |
|
10,800,000 |
| Maxim Group LLC |
|
1,200,000 |
|
1,200,000 |
| Total: |
|
12,000,000 |
|
12,000,000 |
SCHEDULE II
Issuer Free Writing Prospectus
None.
SCHEDULE III
Persons Subject to Lock-up
Dennis J. Carlo, Ph.D
Richard C. Williams
Robert B. Rothermel
David J. Marguglio
William C. Denby, III
Robert O. Hopkins
Karen K. Daniels
Ronald B. Moss, M.D.
EXHIBIT A
Form of Warrant
EXECUTION VERSION
EXHIBIT B
Form of Lock-up Agreement
_________, 2019
Adamis Pharmaceuticals Corporation
11682 El Camino Real, Suite 300
San Diego, California 92130
RAYMOND JAMES & ASSOCIATES, INC.
As Representative of the Several Underwriters
c/o Raymond James & Associates, Inc.
880 Carillon Parkway
St. Petersburg, FL 33716
Re: Adamis
Pharmaceuticals Corporation (the “Company”) - Restriction on Stock Sales
Dear Sirs and Madams:
This letter is delivered
to you pursuant to the Underwriting Agreement (the “Underwriting Agreement”) to be entered into by the Company, as
issuer, and Raymond James & Associates, Inc., the representative (the “Representative”) of certain underwriters
(the “Underwriters”) to be named therein. Upon the terms and subject to the conditions of the Underwriting Agreement,
the Underwriters intend to effect a public offering of Common Stock, par value $0.0001 per share, of the Company and warrants to
purchase Common Stock of the Company (the “Securities”), as described in and contemplated by the registration statement
of the Company on Form S-3, File No. 333-226100 (the “Registration Statement”), as filed with the Securities and Exchange
Commission on July 9, 2018 (the “Offering”).
The undersigned recognizes
that it is in the best financial interests of the undersigned, as an officer or director, or an owner of stock, options, warrants
or other securities of the Company (the “Company Securities”), that the Company complete the proposed Offering.
The undersigned further
recognizes that the Company Securities held by the undersigned are, or may be, subject to certain restrictions on transferability,
including those imposed by United States federal securities laws. Notwithstanding these restrictions, the undersigned has agreed
to enter into this letter agreement to further assure the Underwriters that the Company Securities of the undersigned, now held
or hereafter acquired, will not enter the public market at a time that might impair the underwriting effort.
Therefore, as an inducement
to the Underwriters to execute the Underwriting Agreement, the undersigned hereby acknowledges and agrees that the undersigned
will not (i) offer, sell, contract to sell, pledge, grant any option to purchase or otherwise dispose of (collectively, a “Disposition”)
any Company Securities, or any securities convertible into or exercisable or exchangeable for, or any rights to purchase or otherwise
acquire, any Company Securities held by the undersigned or acquired by the undersigned after the date hereof, or that may be deemed
to be beneficially owned by the undersigned (collectively, the “Lock-Up Shares”), pursuant to the Rules and Regulations
promulgated under the Securities Act of 1933, as amended (the “Act”), and the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), for a period commencing on the date hereof and ending 60 days after the date of the Company’s
Prospectus first filed pursuant to Rule 424(b) under the Act, inclusive (the “Lock-Up Period”), without the prior written
consent of Raymond James & Associates, Inc. or (ii) exercise or seek to exercise or effectuate in any manner any rights of
any nature that the undersigned has or may have hereafter to require the Company to register under the Act the undersigned’s
sale, transfer or other disposition of any of the Lock-Up Shares or other securities of the Company held by the undersigned, or
to otherwise participate as a selling securityholder in any manner in any registration effected by the Company under the Act, including
under the Registration Statement, during the Lock-Up Period. The foregoing restrictions are expressly agreed to preclude the undersigned
from engaging in any hedging, collar (whether or not for any consideration) or other transaction that is designed to or reasonably
expected to lead or result in a Disposition of Lock-Up Shares during the Lock-Up Period, even if such Lock-Up Shares would be disposed
of by someone other than such holder. Such prohibited hedging or other transactions would include any short sale or any purchase,
sale or grant of any right (including any put or call option or reversal or cancellation thereof) with respect to any Lock-Up Shares
or with respect to any security (other than a broad-based market basket or index) that includes, relates to or derives any significant
part of its value from Lock-Up Shares.
Notwithstanding the
agreement not to make any Disposition during the Lock-Up Period, you have agreed that the foregoing restrictions shall not apply
to:
| (1) | the Company Securities being offered in the prospectus
included in the Registration Statement; |
| (2) | any grant or exercise of options pursuant to the Company’s stock option plans; or |
| (3) | sales of Company Securities pursuant to any contract, instruction or plan pursuant to Rule 10b5-1
under the Exchange Act established before the date of this letter prior to the expiration of the Lock-Up Period. |
It is understood
that, if the Underwriting Agreement (other than the provisions thereof that survive termination) shall terminate or be terminated
prior to payment for and delivery of the Securities, you will release the undersigned from the obligations under this letter agreement.
In furtherance of
the foregoing, the Company and its transfer agent and registrar are hereby authorized to decline to make any transfer of Lock-Up
Shares if such transfer would constitute a violation or breach of this letter. This letter shall be binding on the undersigned
and the respective successors, heirs, personal representatives and assigns of the undersigned. Capitalized terms used but not defined
herein have the respective meanings assigned to such terms in the Underwriting Agreement.
| |
Very truly yours, |
|
| |
|
|
| |
|
|
| |
(Name) |
|
| |
|
|
| |
|
|
| |
(Signature) |
|
