Form 8-K
8-K — PRECISION OPTICS CORPORATION, INC.
Accession: 0001683168-26-002421
Filed: 2026-03-30
Period: 2026-03-27
CIK: 0000867840
SIC: 3845 (ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS)
Item: Entry into a Material Definitive Agreement
Item: Unregistered Sales of Equity Securities
Item: Other Events
Item: Financial Statements and Exhibits
Documents
8-K — poci_8k.htm (Primary)
EX-1.1 — UNDERWRITING AGREEMENT (poci_ex-0101.htm)
EX-4.1 — COMMON STOCK PURCHASE WARRANT (poci_ex-0401.htm)
EX-99.1 — PRESS RELEASE (poci_ex9901.htm)
EX-99.2 — PRESS RELEASE (poci_ex9902.htm)
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8-K — FORM 8-K
8-K (Primary)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
March 27, 2026
PRECISION
OPTICS CORPORATION, INC.
(Exact name of registrant as specified in its charter)
Massachusetts
001-10647
04-2795294
(State or other jurisdiction
(Commission
(IRS Employer
of incorporation)
File Number)
Identification No.)
22
East Broadway
Gardner,
Massachusetts
01440
(Address of principal executive offices)
(Zip Code)
(Registrant’s telephone number, including
area code) (978) 630-1800
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to
Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common
stock, par value $0.01 per share
POCI
The Nasdaq Stock Market
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange
Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant
to Section 13(a) of the Exchange Act. ☐
Item 1.01.
Entry into a Material Definitive Agreement.
Underwriting Agreement
On March 27, 2026, Precision Optics Corporation,
Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with Lucid Capital
Markets, LLC (the “Underwriter”), relating to the issuance and sale (the “Offering”) of 2,777,777 shares of its
common stock, par value $0.01 per share, at a price to the public of $3.60 per share. In connection with the Offering, the Company has
granted the Underwriter a 45-day over-allotment option to purchase up to an additional 416,667 shares of the Company’s common stock
at the public offering price, less the underwriting discount.
The net proceeds to the Company from the Offering,
including the full exercise of the over-allotment option, are expected to be approximately $10.7 million, after deducting underwriting
discounts and commissions and other estimated offering expenses payable by the Company. The Company currently intends to use the net proceeds
from the Offering for working capital and for general corporate purposes.
The Offering, including the over-allotment option,
closed on March 30, 2026.
The Offering was made pursuant to the Company’s
effective registration statement on Form S-3 (No. 333-280047) as previously filed with the Securities and Exchange Commission and a related
prospectus and prospectus supplement.
Under the terms of the
Underwriting Agreement, the Underwriter received an underwriting discount of up to 6.5% of the gross proceeds received in the Offering.
In addition, the Company reimbursed the Underwriter for certain of its expenses in an amount not to exceed $90,000 in the aggregate, and
the Company also issued to the Underwriter (or its designees) warrants to purchase up to 159,722 shares of Company common stock with an
exercise price of $4.21 per share (the “Representative’s Warrant”). The Representative’s Warrants are exercisable
at any time on or after March 30, 2026 and will terminate on March 27, 2031.
The Underwriting Agreement contains customary
representations, warranties and covenants by the Company, customary conditions to closing, indemnification obligations of the Company
and the Underwriter, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination
provisions. The representations, warranties and covenants contained in the Underwriting Agreement were made only for purposes of such
agreement and as of specific dates, and were solely for the benefit of the parties to such agreement.
The Underwriting Agreement and form of Representative’s
Warrant are filed as Exhibits 1.1 and 4.1, respectively, hereto. The foregoing descriptions of the terms of the Underwriting Agreement
and Representative’s Warrant are qualified in their entirety by reference to such exhibits hereto.
Item 3.02. Unregistered Sales of Equity Securities.
The information contained in Item 1.01 of this
Current Report on Form 8-K relating to the Representative’s Warrants and the shares issuable upon exercise of the Representative's
Warrants is hereby incorporated by reference into this Item 3.02. The Company issued the Representative’s Warrants pursuant to the
exemption from the registration requirements of the Securities Act of 1933, as amended, available under Section 4(a)(2).
2
Item 8.01.
Other Events.
On March 26, 2026, the Company issued a press
release announcing the proposed Offering. Additionally, on March 27, 2026, the Company issued a second press release announcing the pricing
of the Offering. Copies of these press releases are attached to this Current Report on Form 8-K as Exhibits 99.1 and 99.2, respectively.
Item 9.01.
Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No.
Description
1.1
Underwriting Agreement, dated March 27, 2026, between Precision Optics Corporation, Inc. and Lucid Capital Markets, LLC.
4.1
Form of Representative’s Warrant
99.1
Press release issued by Precision Optics Corporation, Inc., dated March 26, 2026.
99.2
Press release issued by Precision Optics Corporation, Inc., dated March 27, 2026.
104
Cover page Interactive Data File (embedded within the Inline XBRL document)
3
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
PRECISION OPTICS CORPORATION, INC.
Dated: March 30, 2026
By:
/s/ Joseph N. Forkey
Name: Joseph N. Forkey
Title: President
4
EX-1.1 — UNDERWRITING AGREEMENT
EX-1.1
Filename: poci_ex-0101.htm · Sequence: 2
Exhibit 1.1
2,777,777 SHARES of
Common Stock and
0 PRE-FUNDED
Warrants of
PRECISION OPTICS CORPORATION,
INC.
UNDERWRITING AGREEMENT
March 27, 2026
Lucid Capital Markets, LLC
As the Representative of the
Several underwriters, if any, named in Schedule
I hereto
c/o Lucid Capital Markets, LLC
570 Lexington Avenue, 40th Floor
New York, New York 10022
Ladies and Gentlemen:
The undersigned, Precision
Optics Corporation, Inc., a company incorporated under the laws of Massachusetts (collectively with its subsidiaries and affiliates, including,
without limitation, all entities disclosed or described in the Registration Statement as being subsidiaries or affiliates of Precision
Optics Corporation, Inc., (the “Company”), hereby confirms its agreement (this “Agreement”) with
the several underwriters (such underwriters, including the Representative (as defined below), the “Underwriters” and
each an “Underwriter”) named in Schedule I hereto for which Lucid Capital Markets, LLC is acting as representative
to the several Underwriters (the “Representative” and if there are no Underwriters other than the Representative, references
to multiple Underwriters shall be disregarded and the term Representative as used herein shall have the same meaning as Underwriter) on
the terms and conditions set forth herein.
It is understood that the
several Underwriters are to make a public offering of the Securities as soon as the Representative deems it advisable to do so. The Securities
are to be initially offered to the public at the public offering price set forth in the Prospectus.
It is further understood that
you will act as the Representative for the Underwriters in the offering and sale of the Closing Securities and, if any, the Option Shares
in accordance with this Agreement.
ARTICLE I.
DEFINITIONS
1.1
Definitions. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following
terms have the meanings set forth in this Section 1.1:
“Action”
shall have the meaning ascribed to such term in Section 3.1(k).
“Affiliate”
means with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled
by or is under common control with such Person as such terms are used in and construed under Rule 405 under the Securities Act.
1
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally
are open for use by customers on such day.
“Closing”
means the closing of the purchase and sale of the Closing Securities pursuant to Section 2.1.
“Closing
Date” means the hour and the date on the Trading Day on which all conditions precedent to (i) the Underwriters’ obligations
to pay the Closing Purchase Price and (ii) the Company’s obligations to deliver the Closing Securities, in each case, have been
satisfied or waived, but in no event later than 10:00 a.m. (New York City time) on the first (1st) Trading Day following the date hereof
(or the second (2nd) Trading Day following the date hereof if this Agreement is signed on a day that is not a Trading Day or
after 4:00 p.m. (New York City time) and before midnight (New York City time) on a Trading Day) or at such earlier time as shall be agreed
upon by the Representative and the Company.
“Closing
Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b), which aggregate purchase price shall be net
of the underwriting discounts and commissions.
“Closing
Securities” shall have the meaning ascribed to such term in Section 2.1(a)(ii).
“Closing
Shares” shall have the meaning ascribed to such term in Section 2.1(a)(i).
“Closing
Warrants” shall have the meaning ascribed to such term in Section 2.1(a)(ii).
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.01 per share, and any other class of securities into which such securities
may hereafter be reclassified or changed.
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is
at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Company
Auditor” means Stowe & Degon LLC with offices located at 95A Turnpike Road, Westborough, MA 01581.
“Company
Counsel” means ArentFox Schiff LLP with offices located at 800 Boylston Street, 32nd Floor, Boston, MA 02199.
“Effective
Date” shall have the meaning ascribed to such term in Section 3.1(f).
“EGS”
means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
2
“Execution
Date” shall mean the date on which the parties execute and enter into this Agreement.
“Exempt
Issuance” means the issuance of (a) shares of Common Stock, restricted stock units or options to employees, officers or directors
of the Company pursuant to any stock or option plan duly adopted for such purpose by a majority of the non-employee members of the Board
of Directors or a majority of the members of a committee of non-employee directors established for such purpose for services rendered
to the Company, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities
exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the date of this Agreement (including
any underwriter warrants issuable hereunder, if any), 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, and (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority
of the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (as defined
in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith
during the prohibition period in 4.18(a) herein, and provided that any such issuance shall only be to a Person (or to the equity holders
of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with
the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not
include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities.
“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.
“FINRA”
means the Financial Industry Regulatory Authority.
“GAAP”
shall have the meaning ascribed to such term in Section 3.1(i).
“Indebtedness”
means (a) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary
course of business), (b) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or
not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties by
endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (c) the
present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with GAAP.
“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Lock-Up
Agreements” means the lock-up agreements that are delivered on the date hereof by each of the Company’s officers and directors,
in the form of Exhibit A attached hereto.
“Material
Adverse Effect” means (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document,
(ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the
Company and the Subsidiaries, taken as a whole or (iii) a material adverse effect on the Company’s ability to perform in any material
respect on a timely basis its obligations under any Transaction Document.
“Offering”
shall have the meaning ascribed to such term in Section 2.1(c).
“Option”
shall have the meaning ascribed to such term in Section 2.2.
“Option
Closing Date” shall have the meaning ascribed to such term in Section 2.2(c).
3
“Option
Closing Purchase Price” shall have the meaning ascribed to such term in Section 2.2(b), which aggregate purchase price shall
be net of the underwriting discounts and commissions.
“Option
Shares” shall have the meaning ascribed to such term in Section 2.2(a)(i).
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Pre-Funded
Warrants” means, collectively, the Pre-Funded Common Stock purchase warrants delivered to the Underwriters in accordance with
Section 2.1(a)(ii) and Section 2.2, which Pre-Funded Warrants shall be exercisable immediately until exercised in full, in the form of
Exhibit B attached hereto.
“Preliminary
Prospectus” means any preliminary prospectus supplement relating to the Securities included in the Registration Statement.
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Prospectus”
means the base prospectus filed for the Registration Statement.
“Prospectus
Supplement” means, any supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with the
Commission.
“Registration
Statement” means, collectively, the various parts of the registration statement prepared by the Company on Form S-3 (File No.
333-280047) with respect to the Securities, each as amended as of the date hereof, including the Preliminary Prospectus, Prospectus and
Prospectus Supplement, if any, and all exhibits filed with or incorporated by reference into such registration statement, and includes
any Rule 462(b) Registration Statement.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 462(b)
Registration Statement” means any registration statement prepared by the Company registering additional Securities, which was
filed with the Commission on or prior to the date hereof and became automatically effective pursuant to Rule 462(b) promulgated by the
Commission pursuant to the Securities Act.
“SEC Reports”
shall have the meaning ascribed to such term in Section 3.1(i).
“Securities”
means the Closing Securities, the Option Shares and the Warrant Shares.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Share
Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b).
4
“Shares”
means, collectively, the shares of Common Stock delivered to the Underwriters in accordance with Section 2.1(a)(i) and Section 2.2(a).
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.
“Trading
Day” means a day on which the principal Trading Market is open for trading.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock
Exchange (or any successors to any of the foregoing).
“Transaction
Documents” means this Agreement, the Pre-Funded Warrants, the Lock-Up Agreements, and any other documents or agreements executed
in connection with the transactions contemplated hereunder.
“Transfer
Agent” means Computershare Trust Company, N.A., the current transfer agent of the Company, and any successor transfer agent
of the Company.
“Warrant
Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b).
“Warrant
Shares” means the shares of Common Stock issuable upon exercise of the Pre-Funded Warrants.
ARTICLE II.
PURCHASE AND SALE
2.1
Closing.
(a)
Upon the terms and subject to the conditions set forth herein, the Company agrees to sell in the aggregate 2,777,777 shares of
Common Stock and Pre-Funded Warrants exercisable for an aggregate of 0 shares of Common Stock, and each Underwriter agrees to purchase,
severally and not jointly, at the Closing, the following securities of the Company:
(i)
the number of shares of Common Stock (the “Closing Shares”) set forth opposite the name of such Underwriter
on Schedule I hereof; and
(ii)
Pre-Funded Warrants to purchase up to the number of shares of Common Stock set forth opposite the name of such Underwriter on Schedule
I hereof (the “Closing Warrants” and, collectively with the Closing Shares, the “Closing Securities”)
, which Pre-Funded Warrants shall have an exercise price of $0.01, subject to adjustment as provided therein.
(b)
The aggregate purchase price for the Closing Securities shall equal the amount set forth opposite the name of such Underwriter
on Schedule I hereto (the “Closing Purchase Price”). The purchase price for one Share shall be $3.366 (except
as set forth in Schedule I) (the “Share Purchase Price”) and the purchase price for each Warrant Share underlying the
Pre-Funded Warrants shall be the Share Purchase Price less $0.01 per Warrant Share (the “Warrant Purchase Price”);
and
(c)
On the Closing Date, each Underwriter shall deliver or cause to be delivered to the Company, via wire transfer, immediately available
funds equal to such Underwriter’s Closing Purchase Price and the Company shall deliver to, or as directed by, such Underwriter its
respective Closing Securities and the Company shall deliver the other items required pursuant to Section 2.3 deliverable at the Closing.
Upon satisfaction of the covenants and conditions set forth in Sections 2.3 and 2.4, the Closing shall occur at the offices of EGS or
such other location as the Company and Representative shall mutually agree. The Securities are to be offered initially to the public at
the offering price set forth on the cover page of the Prospectus Supplement (the “Offering”).
5
(d)
The Company acknowledges and agrees that, with respect to any Notice(s) of Exercise (as defined in the Pre-Funded Warrants) delivered
by a Holder (as defined in the Pre-Funded Warrants) on or prior to 12:00 p.m. (New York City time) on the Closing Date, which Notice(s)
of Exercise may be delivered at any time after the time of execution of this Agreement, the Company shall deliver the Warrant Shares subject
to such notice(s) to the Holder by 4:00 p.m. (New York City time) on the Closing Date and the Closing Date shall be the Warrant Share
Delivery Date (as defined in the Pre-Funded Warrants). The Company acknowledges and agrees that the Holders are third-party beneficiaries
of this covenant of the Company.
2.2
Option to Purchase Additional Shares.
(a)
For the purposes of covering any over-allotments in connection with the distribution and sale of the Closing Securities, the Representative
is hereby granted an option (the “Option”) to purchase, in the aggregate, up to 416,667 shares of Common Stock (the
“Option Shares”) at the Share Purchase Price.
(b)
In connection with an exercise of the Option, the purchase price to be paid for the Option Shares is equal to the product of the
Share Purchase Price multiplied by the number of Option Shares to be purchased (the aggregate purchase price to be paid on an Option Closing
Date, the “Option Closing Purchase Price”).
(c)
The Option granted pursuant to this Section 2.2 may be exercised by the Representative as to all (at any time) or any part (from
time to time) of the Option Shares within 45 days after the Execution Date. An Underwriter will not be under any obligation to purchase
any Option Shares prior to the exercise of the Option by the Representative. The Option granted hereby may be exercised by the giving
of oral notice to the Company from the Representative, which must be confirmed in writing by overnight mail or electronic transmission
setting forth the number of Option Shares to be purchased and the date and time for delivery of and payment for the Option Shares (each,
an “Option Closing Date”), which will not be later than one (1) full Business Day after the date of the notice or such
other time as shall be agreed upon by the Company and the Representative, at the offices of EGS or at such other place (including remotely
by other electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the
Option Shares does not occur on the Closing Date, each Option Closing Date will be as set forth in the notice. Upon exercise of the Option,
the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters
will become obligated to purchase, the number of Option Shares specified in such notice. The Representative may cancel the Option at any
time prior to the expiration of the Option by written notice to the Company.
2.3
Deliveries. The Company shall deliver or cause to be delivered to each Underwriter (if applicable) the following:
(i)
At the Closing Date, the Closing Shares and, as to each Option Closing Date, if any, the applicable Option Shares, which shares
shall be delivered via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters;
(ii)
At the Closing Date, the Closing Warrants in certificated form registered in the name or names and in such authorized denominations
as the applicable Underwriter may request in writing at least one Business Day prior to the Closing Date;
(iii)
At the Closing Date, and each Option Closing Date, if any, to the Representative only, a Warrant to purchase up to a number of
shares of Common Stock equal to 5.0% of the Closing Shares. Closing Warrants and Option Shares issued on such Closing Date and Option
Closing Date, as applicable, for the account of the Representative (or its designees), which Warrant shall have an exercise price of $4.21,
subject to adjustment therein, and registered in the name of the Representative, otherwise on the same terms as the Closing Warrants;
6
(iv)
At the Closing Date, a legal opinion of Company Counsel, addressed to the Underwriters, including, without limitation, a negative
assurance letter, substantially in the form and substance reasonably satisfactory to the Representative and as to the Closing Date and
as to each Option Closing Date, if any, a bring-down opinion from Company Counsel in form and substance reasonably satisfactory to the
Representative, including, without limitation, a negative assurance letter, addressed to the Underwriters and in form and substance satisfactory
to the Representative;
(v)
Contemporaneously herewith, a cold comfort letter, addressed to the Underwriters and in form and substance satisfactory in all
respects to the Representative from the Company Auditor dated, respectively, as of the date of this Agreement and a bring-down letter
dated as of the Closing Date and each Option Closing Date, if any;
(vi)
On the Closing Date and on each Option Closing Date, the duly executed and delivered Officer’s Certificate, in form and substance
reasonably satisfactory to the Representative;
(vii)
On the Closing Date and on each Option Closing Date, the duly executed and delivered Secretary’s Certificate, in form and
substance reasonably satisfactory to the Representative;
(viii)
On the Closing Date and on each Option Closing Date, if any, the duly executed and delivered Chief Financial Officer’s Certificate,
substantially in the form and substance reasonably satisfactory to the Representative; and
(ix)
Contemporaneously herewith, the duly executed and delivered Lock-Up Agreements.
2.4
Closing Conditions. The respective obligations of each Underwriter hereunder in connection with the Closing and each Option
Closing Date are subject to the following conditions being met:
(i)
the accuracy in all material respects when made and on the date in question (other than representations and warranties of the Company
already qualified by materiality, which shall be true and correct in all respects) of the representations and warranties of the Company
contained herein (unless as of a specific date therein);
(ii)
all obligations, covenants and agreements of the Company required to be performed at or prior to the date in question shall have
been performed;
(iii)
the delivery by the Company of the items set forth in Section 2.3 of this Agreement;
(iv)
the Registration Statement shall be effective on the date of this Agreement and at each of the Closing Date and each Option Closing
Date, if any, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission
for additional information shall have been complied with to the reasonable satisfaction of the Representative;
(v)
by the Execution Date, if required by FINRA, the Underwriters shall have received clearance from FINRA as to the amount of compensation
allowable or payable to the Underwriters as described in the Registration Statement;
(vi)
the Closing Shares, the Option Shares and the Warrant Shares have been approved for listing on the Trading Market; and
7
(vii)
prior to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no material adverse
change or development involving a prospective material adverse change in the condition or prospects or the business activities, financial
or otherwise, of the Company from the latest dates as of which such condition is set forth in the Preliminary Prospectus, Registration
Statement Prospectus and Prospectus Supplement; (ii) no action suit or proceeding, at law or in equity, shall have been pending or
threatened against the Company or any Affiliate of the Company before or by any court or federal or state commission, board or other administrative
agency wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, prospects or financial
condition or income of the Company, except as set forth in the Preliminary Prospectus, Registration Statement, Prospectus and Prospectus
Supplement; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated
or threatened by the Commission; and (iv) the Preliminary Prospectus, Registration Statement, Prospectus and Prospectus Supplement
and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance
with the Securities Act and the rules and regulations thereunder and shall conform in all material respects to the requirements of the
Securities Act and the rules and regulations thereunder, and none of the Preliminary Prospectus, Registration Statement, Prospectus or
the Prospectus Supplement nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1
Representations and Warranties of the Company. The Company represents and warrants to the Underwriters as of the Execution
Date, as of the Closing Date and as of each Option Closing Date, if any, as follows:
(a)
Subsidiaries. All of the direct and indirect Subsidiaries of the Company are set forth in the SEC Reports. The Company owns,
directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of
the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of
preemptive and similar rights to subscribe for or purchase securities. If the Company has no Subsidiaries, all other references to the
Subsidiaries or any of them in the Transaction Documents shall be disregarded.
(b)
Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power
and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any
Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or
other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good
standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned
by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not
have or reasonably be expected to result in a Material Adverse Effect and no Proceeding has been instituted in any such jurisdiction revoking,
limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.
(c)
Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by this Agreement and each of the other Transaction Documents to which the Company is a party and otherwise
to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction
Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all
necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s
stockholders in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction
Document to which the Company is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in
accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating
to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution
provisions may be limited by applicable law.
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(d)
No Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents
to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and
thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or
articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an
event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties
or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments,
acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by
which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict
with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any
property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could
not have or reasonably be expected to result in a Material Adverse Effect.
(e)
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give
any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other
Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filing
with the Commission of the Prospectus Supplement and (ii) such filings as are required to be made under applicable state securities laws
(collectively, the “Required Approvals”).
(f)
Registration Statement. The Company has filed with the Commission the Registration Statement under the Securities Act, which
became effective on June 14, 2024 (the “Effective Date”), for the registration under the Securities Act of the Securities.
At the time of such filing, the Company met the requirements of Form S-3 under the Securities Act. The Registration Statement meets the
requirements set forth in Rule 415(a)(1)(x) under the Securities Act and complies with said Rule and the Prospectus Supplement will meet
the requirements set forth in Rule 424(b). The Company is eligible to use Form S-3 under the Securities Act and it meets the transaction
requirements with respect to the aggregate market value of securities being sold pursuant to this offering and during the twelve (12)
months prior to this offering, as set forth in General Instruction I.B.6 of Form S-3. The Company has advised the Representative of all
further information (financial and other) with respect to the Company required to be set forth therein in the Registration Statement,
Preliminary Prospectus, Prospectus and Prospectus Supplement. Any reference in this Agreement to the Registration Statement, Preliminary
Prospectus, the Prospectus or the Prospectus Supplement shall be deemed to refer to and include the documents incorporated by reference
therein which were filed under the Exchange Act, on or before the date of this Agreement, or the issue date of the Prospectus, the Preliminary
Prospectus or the Prospectus Supplement, as the case may be; and any reference in this Agreement to the terms “amend,” “amendment”
or “supplement” with respect to the Registration Statement, the Preliminary Prospectus, the Prospectus or the Prospectus Supplement
shall be deemed to refer to and include the filing of any document under the Exchange Act after the date of this Agreement, or the issue
date of the Preliminary Prospectus, the Prospectus or the Prospectus Supplement, as the case may be, deemed to be incorporated therein
by reference. All references in this Agreement to financial statements and schedules and other information which is “contained,”
“included,” “described,” “referenced,” “set forth” or “stated” in the Registration
Statement, the Prospectus, the Preliminary Prospectus, or the Prospectus Supplement (and all other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated
by reference in the Registration Statement, the Prospectus, the Preliminary Prospectus, or the Prospectus Supplement, as the case may
be. No stop order suspending the effectiveness of the Registration Statement or the use of the Preliminary Prospectus, the Prospectus
or the Prospectus Supplement has been issued, and no proceeding for any such purpose is pending or has been initiated or, to the Company's
knowledge, is threatened by the Commission. For purposes of this Agreement, “free writing prospectus” has the meaning
set forth in Rule 405 under the Securities Act. The Company will not, without the prior consent of the Representative, prepare, use or
refer to, any free writing prospectus.
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(g)
Issuance of Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company.
The Warrant Shares, when issued in accordance with the terms of the Pre-Funded Warrants, will be validly issued, fully paid and nonassessable,
free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital stock the maximum number
of shares of Common Stock issuable pursuant to this Agreement and the Pre-Funded Warrants. The holder of the Securities will not be subject
to personal liability by reason of being such holders. The Securities are not and will not be subject to the preemptive rights of any
holders of any security of the Company or similar contractual rights granted by the Company. All corporate action required to be taken
for the authorization, issuance and sale of the Securities has been duly and validly taken. The Securities conform in all material respects
to all statements with respect thereto contained in the Registration Statement.
(h)
Capitalization. The capitalization of the Company is as set forth in the SEC Reports. The Company has not issued any capital
stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options
under the Company’s stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee
stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most
recently filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as a result of the purchase
and sale of the Securities, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person
any right to subscribe for or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock
Equivalents or the capital stock of any Subsidiary. The issuance and sale of the Securities will not obligate the Company or any Subsidiary
to issue shares of Common Stock or other securities to any Person (other than the Underwriters). There are no outstanding securities or
instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such
security or instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments
of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary.
The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement.
All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any
preemptive rights or similar rights to subscribe for or purchase securities. The authorized shares of the Company conform in all material
respects to all statements relating thereto contained in the Registration Statement and the Prospectus. The offers and sales of the Company’s
securities were at all relevant times either registered under the Securities Act and the applicable state securities or Blue Sky laws
or, based in part on the representations and warranties of the purchasers, exempt from such registration requirements. No further approval
or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Securities. There are
no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the
Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
10
(i)
SEC Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required
to be filed by the Company under the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the
date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the “SEC
Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements
of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of
a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the
SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally
accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be
otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all
footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries
as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments. The agreements and documents described in the Preliminary Prospectus, the
Registration Statement, the Prospectus, the Prospectus Supplement and the SEC Reports conform to the descriptions thereof contained therein
and there are no agreements or other documents required by the Securities Act and the rules and regulations thereunder to be described
in the Preliminary Prospectus, the Registration Statement, the Prospectus, the Prospectus Supplement or the SEC Reports or to be filed
with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument
(however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i) that is
referred to in the Preliminary Prospectus, the Registration Statement, the Prospectus, the Prospectus Supplement or the SEC Reports, or
(ii) is material to the Company’s business, has been duly authorized and validly executed by the Company, is in full force
and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the other parties thereto,
in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar
laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may be limited
under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable
relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefore may be brought.
None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the best of the Company’s
knowledge, any other party is in default thereunder and, to the best of the Company’s knowledge, no event has occurred that, with
the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best of the Company’s knowledge,
performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing
applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction
over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and regulations.
(j)
Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements
included within the SEC Reports, except as specifically disclosed in a subsequent SEC Report filed prior to the date hereof, (i) there
has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect,
(ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred
in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s
financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of
accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital stock, (v) the Company has not issued any equity securities
to any officer, director or Affiliate, except pursuant to existing Company stock option plans and (vi) no officer or director of the Company
has resigned from any position with the Company. The Company does not have pending before the Commission any request for confidential
treatment of information. Except for the issuance of the Securities contemplated by this Agreement, no event, liability, fact, circumstance,
occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries
or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed
by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed
at least one (1) Trading Day prior to the date that this representation is made. Unless otherwise disclosed in an SEC Report filed prior
to the date hereof, the Company has not: (i) issued any securities or incurred any liability or obligation, direct or contingent,
for borrowed money; or (ii) declared or paid any dividend or made any other distribution on or in respect to its capital stock.
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(k)
Litigation. There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge
of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court,
arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an
“Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction
Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material
Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action
involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has
not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the
Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending
the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(l)
Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees
of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’
employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the
Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that
their relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary,
is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary
information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third
party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability
with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and
foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours,
except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect.
(m)
Compliance. Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred
that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under),
nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture,
loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator
or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental
authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational
health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be
expected to result in a Material Adverse Effect.
(n)
Regulatory Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the
appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the
SEC Reports, except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect
(each, a “Material Permit”), and neither the Company nor any Subsidiary has received any notice of proceedings relating
to the revocation or modification of any Material Permit. The disclosures in the Registration Statement concerning the effects of Federal,
State, local and all foreign regulation on the Company’s business as currently contemplated are correct in all material respects.
(o)
Title to Assets. Except as set forth in the SEC Reports, the Company and the Subsidiaries have good and marketable title
in fee simple to, or have valid and marketable rights to lease or otherwise use, all real property and all personal property that is material
to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially
affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company
and the Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor
in accordance with GAAP, and the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held
under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company
and the Subsidiaries are in compliance.
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(p)
Intellectual Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks,
trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights
and similar rights necessary or required for use in connection with their respective businesses as described in the SEC Reports and which
the failure to do so could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None
of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights
has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, except as would not reasonably be expected
to have a Material Adverse Effect. Neither the Company nor any Subsidiary has received, since the date of the latest audited financial
statements included within the SEC Reports, a written notice of a claim alleging that the conduct of the business of the Company or any
Subsidiary infringes, misappropriates, or otherwise violates the intellectual property rights of any Person, except as would not reasonably
be expected to have a Material Adverse Effect; and, to the knowledge of the Company, there is no such pending or threatened claim. To
the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person
of any of the Intellectual Property Rights. The Company and its Subsidiaries have taken commercially reasonable measures to protect the
secrecy, confidentiality and value of all of their trade secrets and other material confidential information, except where failure to
do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(q)
Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged,
including, but not limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business without a significant increase in cost.
(r)
Transactions With Affiliates and Employees. Except as set forth in the SEC Reports, none of the officers or directors of
the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently
a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including
any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal
property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from, any
officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee
has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other
than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company
and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.
(s)
Sarbanes-Oxley; Internal Accounting Controls. The Company and the Subsidiaries are in compliance with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations
promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date. The Company and the Subsidiaries
maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance
with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such
disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits
under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules
and forms. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company
and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date,
the “Evaluation Date”). The Company presented in its most recently filed periodic report under the Exchange Act the
conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as
of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as such
term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely to materially
affect, the internal control over financial reporting of the Company and its Subsidiaries.
13
(t)
Certain Fees. Except as set forth in the Preliminary Prospectus and the Prospectus Supplement, no brokerage or finder’s
fees or commissions are or will be payable by the Company, any Subsidiary or Affiliate of the Company to any broker, financial advisor
or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction
Documents. To the Company’s knowledge, there are no other arrangements, agreements or understandings of the Company or, to the Company’s
knowledge, any of its stockholders that may affect the Underwriters’ compensation, as determined by FINRA. The Company has not made
any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or
otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided
capital to the Company; (ii) any FINRA member; or (iii) any person or entity that has any direct or indirect affiliation or
association with any FINRA member, within the twelve months prior to the Execution Date. None of the net proceeds of the Offering will
be paid by the Company to any participating FINRA member or its affiliates, except as specifically authorized herein.
(u)
Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities
will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration
under the Investment Company Act of 1940, as amended.
(v)
Registration Rights. No Person has any right to cause the Company or any Subsidiary to effect the registration under the
Securities Act of any securities of the Company or any Subsidiary.
(w)
Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) of the Exchange Act, and
the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of
the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating
such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which the
Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements
of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance
with all such listing and maintenance requirements. The Common Stock is currently eligible for electronic transfer through the Depository
Trust Company or another established clearing corporation and the Company is current in payment of the fees of the Depository Trust Company
(or such other established clearing corporation) in connection with such electronic transfer.
(x)
Application of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights
agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents)
or the laws of its state of incorporation that is or could become applicable as a result of the Underwriters and the Company fulfilling
their obligations or exercising their rights under the Transaction Documents.
14
(y)
Disclosure; 10b-5. The Registration Statement (and any further documents to be filed with the Commission) contains all exhibits
and schedules as required by the Securities Act. Each of the Registration Statement and any post-effective amendment thereto, if any,
at the time it became effective, complied in all material respects with the Securities Act and the Exchange Act and the applicable rules
and regulations under the Securities Act and did not and, as amended or supplemented, if applicable, will not, contain any untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
The Preliminary Prospectus, Prospectus and the Prospectus Supplement, each as of its respective date, comply in all material respects
with the Securities Act and the Exchange Act and the applicable rules and regulations. Each of the Preliminary Prospectus, Prospectus
and the Prospectus Supplement, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of
a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under
which they were made, not misleading. The SEC Reports, when they were filed with the Commission, conformed in all material respects to
the requirements of the Exchange Act and the applicable rules and regulations, and none of such documents, when they were filed with the
Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein
(with respect to the SEC Reports incorporated by reference in the Preliminary Prospectus, Prospectus or the Prospectus Supplement), in
light of the circumstances under which they were made not misleading; and any further documents so filed and incorporated by reference
in the Preliminary Prospectus, Prospectus or the Prospectus Supplement, when such documents are filed with the Commission, will conform
in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, as applicable, and will not
contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of
the circumstances under which they were made not misleading. No post-effective amendment to the Registration Statement reflecting any
facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information
set forth therein is required to be filed with the Commission. There are no documents required to be filed with the Commission in connection
with the transaction contemplated hereby that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed
within the requisite time period. There are no contracts or other documents required to be described in the Preliminary Prospectus, Prospectus
or the Prospectus Supplement, or to be filed as exhibits or schedules to the Registration Statement, which have not been described or
filed as required. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken
as a whole did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under which they were made and when made, not misleading.
(z)
No Integrated Offering. Neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has,
directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that
would cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of any applicable shareholder
approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.
(aa)
Solvency. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the
receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets
exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on
its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements
of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii)
the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after
taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when
such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking
into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts or
circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws
of any jurisdiction within one year from the Closing Date. The SEC Reports sets forth as of the date hereof all outstanding secured and
unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. Neither the Company
nor any Subsidiary is in default with respect to any Indebtedness.
15
(bb)
Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result
in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income
and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has
paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns,
reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for
periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount
claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for
any such claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration
Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of
such consolidated financial statements. The term “taxes” mean all federal, state, local, foreign, and other net income, gross
income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll,
employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments,
or charges of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect
thereto. The term “returns” means all returns, declarations, reports, statements, and other documents required to be filed
in respect to taxes.
(cc)
Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary,
any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful
payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate
funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf
of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of FCPA. The Company
has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all
material respects with the FCPA.
(dd)
Accountants. To the knowledge and belief of the Company, the Company Auditor (i) is an independent registered public accounting
firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the
Company’s Annual Report for the fiscal year ending June 30, 2026. The Company Auditor has not, during the periods covered by the
financial statements included in the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g)
of the Exchange Act.
(ee)
Reserved.
(ff)
Stock Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i)
in accordance with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market
value of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted
under the Company’s stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no
Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with,
the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results
or prospects.
(gg)
Office of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director,
officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the
Office of Foreign Assets Control of the U.S. Treasury Department.
16
(hh)
U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within
the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Representative’s
request.
(ii)
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the
“Federal Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly,
five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total
equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its
Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to
the BHCA and to regulation by the Federal Reserve.
(jj)
Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance
with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering
Laws”), and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving
the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary,
threatened.
(kk)
D&O Questionnaires. To the Company’s knowledge, all information contained in the questionnaires completed by each
of the Company’s directors and officers immediately prior to the Offering and in the Lock-Up Agreement provided to the Underwriters
is true and correct in all material respects and the Company has not become aware of any information which would cause the information
disclosed in such questionnaires become inaccurate and incorrect.
(ll)
FINRA Affiliation. No officer, director or, to the Company’s knowledge any beneficial owner of 10% or more of the
Company’s unregistered securities, has any direct or indirect affiliation or association with any FINRA member (as determined in
accordance with the rules and regulations of FINRA) that is participating in the Offering. The Company will advise the Representative
and EGS if it learns that any officer, director or owner of 10% or more of the Company’s outstanding shares of Common Stock or Common
Stock Equivalents is or becomes an affiliate or associated person of a FINRA member firm.
(mm)
Officers’ Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to the Representative
or EGS shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
(nn)
Board of Directors. The Board of Directors is comprised of the persons set forth under the SEC Reports. The qualifications
of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002
and the rules promulgated thereunder applicable to the Company and the rules of the Trading Market. At least one member of the Board of
Directors qualifies as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated
thereunder and the rules of the Trading Market. In addition, at least a majority of the persons serving on the Board of Directors qualify
as “independent” as defined under the rules of the Trading Market.
17
(oo)
Cybersecurity. There has been no security breach or other compromise of or relating to any of the Company’s
or any Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective
customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively,
“IT Systems and Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of
any event or condition that would reasonably be expected to result in, any security breach or other compromise to its IT Systems and Data;
(ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules
and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating
to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation
or modification, except as would not, individually or in the aggregate, have a Material Adverse Effect; (iii) the Company and the
Subsidiaries have implemented and maintained commercially reasonable safeguards to maintain and protect its material confidential information
and the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries
have implemented backup and disaster recovery technology consistent with industry standards and practices.
(pp)
Compliance with Data Privacy Laws. (i) The Company and the Subsidiaries are, and at all times during the last three
(3) years were, in compliance with all applicable state, federal and foreign data privacy and security laws and regulations, including,
without limitation, the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679) (collectively, “Privacy
Laws”); (ii) the Company and the Subsidiaries have in place, comply with, and take appropriate steps reasonably designed
to ensure compliance with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure,
handling and analysis of Personal Data (as defined below) (the “Policies”); (iii) the Company provides accurate
notice of its applicable Policies to its customers, employees, third party vendors and representatives as required by the Privacy Laws;
and (iv) applicable Policies provide accurate and sufficient notice of the Company’s then-current privacy practices relating
to its subject matter, and do not contain any material omissions of the Company’s then-current privacy practices, as required by
Privacy Laws. “Personal Data” means (i) a natural person’s name, street address, telephone number,
email address, photograph, social security number, bank information, or customer or account number; (ii) any information which would
qualify as “personally identifying information” under the Federal Trade Commission Act, as amended; (iii) “personal
data” as defined by GDPR; and (iv) any other piece of information that allows the identification of such natural person, or
his or her family, or permits the collection or analysis of any identifiable data related to an identified person’s health or sexual
orientation. (i) None of such disclosures made or contained in any of the Policies have been inaccurate, misleading, or deceptive
in violation of any Privacy Laws and (ii) the execution, delivery and performance of the Transaction Documents will not result in
a breach of any Privacy Laws or Policies. Neither the Company nor the Subsidiaries (i) to the knowledge of the Company, has
received written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation
by the Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part,
any investigation, remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or
(iii) is a party to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that
imposed any obligation or liability under any Privacy Law.
(qq)
Environmental Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign
laws relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface
or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants,
or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters,
orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective
businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i),
(ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
18
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1
Amendments to Registration Statement. The Company has delivered, or will as promptly as practicable deliver, to the Underwriters
complete conformed copies of the Registration Statement and of each consent and certificate of experts, as applicable, filed as a part
thereof, and conformed copies of the Registration Statement (without exhibits), the Preliminary Prospectus, the Prospectus and the Prospectus
Supplement, as amended or supplemented, in such quantities and at such places as an Underwriter reasonably requests. Neither the Company
nor any of its directors and officers has distributed and none of them will distribute, prior to the Closing Date, any offering material
in connection with the offering and sale of the Securities other than the Preliminary Prospectus, the Prospectus, the Prospectus Supplement,
the Registration Statement, and copies of the documents incorporated by reference therein. The Company shall not file any such amendment
or supplement to which the Representative shall reasonably object in writing.
4.2
Federal Securities Laws.
(a)
Compliance. During the time when a Prospectus is required to be delivered under the Securities Act, the Company will use
its best efforts to comply with all requirements imposed upon it by the Securities Act and the rules and regulations thereunder and the
Exchange Act and the rules and regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of
sales of or dealings in the Securities in accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating
to the Securities is required to be delivered under the Securities Act, any event shall have occurred as a result of which, in the opinion
of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement
of a material fact or omits to state any 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, or if it is necessary at any time to amend the Prospectus to comply with
the Securities Act, the Company will notify the Underwriters promptly and prepare and file with the Commission, subject to Section 4.1
hereof, an appropriate amendment or supplement in accordance with Section 10 of the Securities Act.
(b)
Filing of Final Prospectus Supplement. The Company will file the Prospectus Supplement (in form and substance satisfactory
to the Representative) with the Commission pursuant to the requirements of Rule 424.
(c)
Reserved.
(d)
Free Writing Prospectuses. The Company represents and agrees that it has not made and will not make any offer relating to
the Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the
Securities Act, without the prior written consent of the Representative. Any such free writing prospectus consented to by the Representative
is herein referred to as a “Permitted Free Writing Prospectus.” The Company represents that it will treat each
Permitted Free Writing Prospectus as an “issuer free writing prospectus” as defined in rule and regulations under the Securities
Act, and has complied and will comply with the applicable requirements of Rule 433 of the Securities Act, including timely Commission
filing where required, legending and record keeping.
4.3
Delivery to the Underwriters of Prospectuses. The Company will deliver to the Underwriters, without charge, from time to
time during the period when the Prospectus is required to be delivered under the Securities Act or the Exchange Act such number of copies
of each Prospectus as the Underwriters may reasonably request and pursuant to Rule 172 of the Securities Act, as soon as the Registration
Statement or any amendment or supplement thereto becomes effective, deliver to the Representative two (2) Registration Statements, including
exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated therein by reference and
all consents of certified experts.
19
4.4
Effectiveness and Events Requiring Notice to the Underwriters. The Company will use its best efforts to cause the Registration
Statement to remain effective with a current prospectus until the later of nine (9) months from the Execution Date and the date on which
the Pre-Funded Warrants are no longer outstanding, and will notify the Underwriters and holders of the Pre-Funded Warrants immediately
and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of
the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of
the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Securities for offering
or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and
delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt
of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the
period described in this Section 4.4 that, in the judgment of the Company, makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order
to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state
securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort
to obtain promptly the lifting of such order.
4.5
Review of Financial Statements. For a period of five (5) years from the Execution Date, the Company, at its expense, shall,
to the extent its Common Stock is registered pursuant to Section 12(b) of the Exchange Act, cause its regularly engaged independent registered
public accountants to review (but not audit) the Company’s financial statements for each of the first three fiscal quarters prior
to the announcement of quarterly financial information.
4.6
Expenses of the Offering.
(a)
General Expenses Related to the Offering. The Company hereby agrees to pay on each of the Closing Date and each Option Closing
Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under
this Agreement, including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Securities
to be sold in the Offering (including the Option Shares) with the Commission; (b) all FINRA Public Offering Filing System fees associated
with the review of the Offering by FINRA; all fees and expenses relating to the listing of such Closing Shares, Option Shares and Warrant
Shares on the Trading Market and such other stock exchanges as the Company and the Representative together determine; (c) all fees, expenses
and disbursements relating to the registration or qualification of such Securities under the “blue sky” securities laws of
such states and other foreign jurisdictions as the Representative may reasonably designate (including, without limitation, all filing
and registration fees, and the fees and expenses of Blue Sky counsel); (d) the costs of all mailing and printing of the underwriting documents
(including, without limitation, the Underwriting Agreement, any Blue Sky Surveys and, if appropriate, any Agreement Among Underwriters,
Selected Dealers’ Agreement, Underwriters’ Questionnaire and Power of Attorney), Registration Statements, Prospectuses and
all amendments, supplements and exhibits thereto and as many preliminary and final Prospectuses as the Representative may reasonably deem
necessary; (e) the costs and expenses of the Company’s public relations firm; (f) the costs of preparing, printing and delivering
the Securities; (g) fees and expenses of the Transfer Agent for the Securities (including, without limitation, any fees required for same-day
processing of any instruction letter delivered by the Company); (h) stock transfer and/or stamp taxes, if any, payable upon the transfer
of securities from the Company to the Underwriters; (i) the fees and expenses of the Company’s accountants; and (j) the fees and
expenses of the Company’s legal counsel and other agents and representatives. The Underwriters may also deduct from the net proceeds
of the Offering payable to the Company on the Closing Date, or each Option Closing Date, if any, the expenses set forth herein to be paid
by the Company to the Underwriters.
(b)
Expenses of the Representative. The Company further agrees that, in addition to the expenses payable pursuant to Section
4.5(a), on the Closing Date it will reimburse to the Representative for its out-of-pocket expenses, including, without limitation, the
fees and expenses of counsel of the Representative, in connection with the Offering, up to $90,000 in the aggregate by deduction from
the proceeds of the Offering contemplated herein.
20
4.7
Application of Net Proceeds. The Company will apply the net proceeds from the Offering received by it in a manner consistent
with the application described under the caption “Use of Proceeds” in the Preliminary Prospectus and Prospectus Supplement.
4.8
Delivery of Earnings Statements to Security Holders. The Company will make generally available to its security holders as
soon as practicable, but not later than the first day of the fifteenth full calendar month following the Execution Date, an earnings statement
(which need not be certified by independent public or independent certified public accountants unless required by the Securities Act or
the Rules and Regulations under the Securities Act, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities
Act) covering a period of at least twelve consecutive months beginning after the Execution Date.
4.9
Stabilization. Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders (without the
consent of the Representative) has taken or will take, directly or indirectly, any action designed to or that has constituted or that
might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of the Securities.
4.10
Internal Controls. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances
that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions
are recorded as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability
for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and
(iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
4.11
Accountants. The Company shall continue to retain a nationally recognized independent certified public accounting firm for
a period of at least three years after the Execution Date. The Underwriters acknowledge that the Company Auditor is acceptable to the
Underwriters.
4.12
FINRA. The Company shall advise the Underwriters (who shall make an appropriate filing with FINRA) if it is aware that any
5% or greater shareholder of the Company becomes an affiliate or associated person of an Underwriter.
4.13
No Fiduciary Duties. The Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely
contractual and commercial in nature, based on arms-length negotiations and that neither the Underwriters nor their affiliates or any
selected dealer shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the Company or any of its
affiliates in connection with the Offering and the other transactions contemplated by this Agreement. 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 by the Underwriters
for the shares and the Underwriters have no obligation to disclose, or account to the Company for, any of such additional financial interests.
The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters
with respect to any breach or alleged breach of fiduciary duty.
4.14
Warrant Shares. If all or any portion of a Pre-Funded Warrant is exercised at a time when there is an effective registration
statement to cover the issuance of the Warrant Shares or if the Pre-Funded Warrant is exercised via cashless exercise, the Warrant Shares
issued pursuant to any such exercise shall be issued free of all restrictive legends. If at any time following the date hereof the Registration
Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise
available for the sale of the Warrant Shares, the Company shall immediately notify the holders of the Pre-Funded Warrants in writing that
such registration statement is not then effective and thereafter shall promptly notify such holders when the registration statement is
effective again and available for the sale of the Warrant Shares (it being understood and agreed that the foregoing shall not limit the
ability of the Company to issue, or any holder thereof to sell, any of the Warrant Shares in compliance with applicable federal and state
securities laws).
21
4.15
Securities Laws Disclosure; Publicity. At the request of the Representative, by 9:00 a.m. (New York City time) on the date
hereof, the Company shall issue a press release disclosing the material terms of the Offering. The Company and the Representative shall
consult with each other in issuing any other press releases with respect to the Offering, and neither the Company nor any Underwriter
shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect
to any press release of such Underwriter, or without the prior consent of such Underwriter, with respect to any press release of the Company,
which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing
party shall promptly provide the other party with prior notice of such public statement or communication. The Company will not issue press
releases or engage in any other publicity, without the Representative’s prior written consent, for a period ending at 5:00 p.m.
(New York City time) on the first business day following the 45th day following the Closing Date, other than normal and customary releases
issued in the ordinary course of the Company’s business.
4.16
Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other
Person, that any Underwriter of the Securities is an “Acquiring Person” under any control share acquisition, business combination,
poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter
adopted by the Company, or that any Underwriter of Securities could be deemed to trigger the provisions of any such plan or arrangement,
by virtue of receiving Securities.
4.17
Reservation of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and
keep available at all times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the
Company to issue Option Shares pursuant to the Option and Warrant Shares pursuant to any exercise of the Pre-Funded Warrants.
4.18
Listing of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common
Stock on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote
all of the Closing Shares, Option Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Closing
Shares, Option Shares and Warrant Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common
Stock traded on any other Trading Market, it will then include in such application all of the Closing Shares, Option Shares and Warrant
Shares, and will take such other action as is necessary to cause all of the Closing Shares, Option Shares and Warrant Shares to be listed
or quoted on such other Trading Market as promptly as possible. The Company will then take all action reasonably necessary to continue
the listing and trading of its Common Stock on a Trading Market and will comply in all respects with the Company’s reporting, filing
and other obligations under the bylaws or rules of the Trading Market. The Company agrees to maintain the eligibility of the Common Stock
for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation,
by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic
transfer.
4.19
Subsequent Equity Sales.
(a)
From the date hereof until ninety (90) days after the Closing Date, neither the Company nor any Subsidiary shall issue, enter into
any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents.
(b)
From the date hereof until ninety (90) days after the Closing Date, the Company shall be prohibited from effecting or entering
into an agreement to effect any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock Equivalents (or a combination
of units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the
Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right
to receive, additional shares of Common Stock either (A) at a conversion price, exercise price or exchange rate or other price that is
based upon, and/or varies with, the trading prices of or quotations for the shares of Common Stock at any time after the initial issuance
of such debt or equity securities or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date
after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly
related to the business of the Company or the market for the Common Stock or (ii) enters into, or effects a transaction under, any agreement,
including, but not limited to, an equity line of credit or an “at-the-market offering”, whereby the Company may issue securities
at a future determined price regardless of whether shares pursuant to such agreement have actually been issued and regardless of whether
such agreement is subsequently canceled.
22
(c)
Notwithstanding the foregoing, this Section 4.18 shall not apply in respect of an Exempt Issuance, except that no Variable Rate
Transaction shall be an Exempt Issuance.
4.20
Research Independence. The Company acknowledges that each Underwriter’s research analysts and research departments,
if any, are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal
policies, and that such Underwriter’s research analysts may hold and make statements or investment recommendations and/or publish
research reports with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company hereby
waives and releases, to the fullest extent permitted by law, any claims that the Company may have against such Underwriter with respect
to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research
departments may be different from or inconsistent with the views or advice communicated to the Company by such Underwriter’s investment
banking divisions. The Company acknowledges that the Representative 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 position
in debt or equity securities of the Company.
ARTICLE V.
DEFAULT BY UNDERWRITERS
If
on the Closing Date or any Option Closing Date, if any, any Underwriter shall fail to purchase and pay for the portion of the Closing
Securities or Option Shares, as the case may be, which such Underwriter has agreed to purchase and pay for on such date (otherwise than
by reason of any default on the part of the Company), the Representative, or if the Representative is the defaulting Underwriter, the
non-defaulting Underwriters, shall use their reasonable efforts to procure within 36 hours thereafter one or more of the other Underwriters,
or any others, to purchase from the Company such amounts as may be agreed upon and upon the terms set forth herein, the Closing Securities
or Option Shares , as the case may be, which the defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours the
Representative shall not have procured such other Underwriters, or any others, to purchase the Closing Securities or Option Shares, as
the case may be, agreed to be purchased by the defaulting Underwriter or Underwriters, then (a) if the aggregate number of Closing Securities
or Option Shares, as the case may be, with respect to which such default shall occur does not exceed 10% of the Closing Securities or
Option Shares, as the case may be, covered hereby, the other Underwriters shall be obligated, severally, in proportion to the respective
numbers of Closing Securities or Option Shares, as the case may be, which they are obligated to purchase hereunder, to purchase the Closing
Securities or Option Shares, as the case may be, which such defaulting Underwriter or Underwriters failed to purchase, or (b) if the aggregate
number of Closing Securities or Option Shares, as the case may be, with respect to which such default shall occur exceeds 10% of the Closing
Securities or Option Shares, as the case may be, covered hereby, the Company or the Representative will have the right to terminate this
Agreement without liability on the part of the non-defaulting Underwriters or of the Company except to the extent provided in Article
VI hereof. In the event of a default by any Underwriter or Underwriters, as set forth in this Article V, the applicable Closing Date may
be postponed for such period, not exceeding seven days, as the Representative, or if the Representative is the defaulting Underwriter,
the non-defaulting Underwriters, may determine in order that the required changes in the Prospectus or in any other documents or arrangements
may be effected. The term “Underwriter” includes any Person substituted for a defaulting Underwriter. Any action taken under
this Section shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
23
ARTICLE VI.
INDEMNIFICATION
6.1
Indemnification of the Underwriters. Subject to the conditions set forth below, the Company agrees to indemnify and hold
harmless the Underwriters, and each dealer selected by each Underwriter that participates in the offer and sale of the Securities (each
a “Selected Dealer”) and each of their respective directors, officers and employees and each Person, if any, who controls
such Underwriter or any Selected Dealer (“Controlling Person”) within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited
to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced
or threatened, or any claim whatsoever, whether arising out of any action between such Underwriter and the Company or between such Underwriter
and any third party or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other
statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any Proceeding, commenced or
threatened (whether or not such Underwriter is a target of or party to such Proceeding), or arising out of or based upon any untrue statement
or alleged untrue statement of a material fact contained in (i) the Preliminary Prospectus, the Registration Statement, the Prospectus
or the Prospectus Supplement (as from time to time each may be amended and supplemented); (ii) any materials or information provided to
investors by, or with the approval of, the Company in connection with the marketing of the offering of the Securities, including any “road
show” or investor presentations made to investors by the Company (whether in person or electronically); or (iii) any application
or other document or written communication (in this Article VI, collectively called “application”) executed by the
Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Securities under the securities
laws thereof or filed with the Commission, any state securities commission or agency, Trading Market or any securities exchange; or the
omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, unless such statement or omission was made in reliance upon and
in conformity with written information furnished to the Company with respect to the applicable Underwriter by or on behalf of such Underwriter
expressly for use in the Preliminary Prospectus, the Registration Statement, the Prospectus or the Prospectus Supplement, or any amendment
or supplement thereto, or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement
or omission made in the Preliminary Prospectus, the indemnity agreement contained in this Section 6.1 shall not inure to the benefit of
an Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy
of the Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation
of sale of the Securities to such Person as required by the Securities Act and the rules and regulations thereunder, and if the untrue
statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance
by the Company with its obligations under this Agreement. The Company agrees promptly to notify each Underwriter of the commencement of
any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue
and sale of the Securities or in connection with the Registration Statement, Preliminary Prospectus, the Prospectus or Prospectus Supplement.
6.2
Procedure. If any action is brought against an Underwriter, a Selected Dealer or a Controlling Person in respect of which
indemnity may be sought against the Company pursuant to Section 6.1, such Underwriter, such Selected Dealer or Controlling Person, as
the case may be, shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense
of such action, including the employment and fees of counsel (subject to the reasonable approval of such Underwriter or such Selected
Dealer, as the case may be) and payment of actual expenses. Such Underwriter, such Selected Dealer or Controlling Person shall have the
right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter,
such Selected Dealer or Controlling Person unless (i) the employment of such counsel at the expense of the Company shall have been authorized
in writing by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel to have charge
of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available
to it or them which are different from or additional to those available to the Company (in which case the Company shall not have the right
to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses
of not more than one additional firm of attorneys selected by such Underwriter (in addition to local counsel), Selected Dealer and/or
Controlling Person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if any Underwriter, Selected
Dealer or Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve the
terms of any settlement of such action which approval shall not be unreasonably withheld.
24
6.3
Indemnification of the Company. Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Company,
its directors, officers and employees and agents who control the Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company
to such Underwriter, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made
in the Preliminary Prospectus, the Registration Statement, the Prospectus or the Prospectus Supplement or any amendment or supplement
thereto or in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect
to such Underwriter by or on behalf of such Underwriter expressly for use in such Preliminary Prospectus, the Registration Statement,
the Prospectus or the Prospectus Supplement or any amendment or supplement thereto or in any such application. The parties acknowledge
and agree such information consists solely of the disclosure in the fifth, twelfth, thirteenth and sixteenth paragraphs in the “Underwriting”
section of the Prospectus (the “Underwriter Information”). In case any action shall be brought against the Company or any
other Person so indemnified based on the Preliminary Prospectus, the Registration Statement, the Prospectus or the Prospectus Supplement
or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against such Underwriter, such
Underwriter shall have the rights and duties given to the Company, and the Company and each other Person so indemnified shall have the
rights and duties given to such Underwriter by the provisions of this Article VI. Notwithstanding the provisions of this Section 6.3,
no Underwriter shall be required to indemnify the Company for any amount in excess of the underwriting discounts and commissions applicable
to the Securities purchased by such Underwriter. The Underwriters' obligations in this Section 6.3 to indemnify the Company are several
in proportion to their respective underwriting obligations and not joint.
6.4
Contribution.
(a)
Contribution Rights. In order to provide for just and equitable contribution under the Securities Act in any case in which
(i) any Person entitled to indemnification under this Article VI makes a claim for indemnification pursuant hereto but it is judicially
determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Article
VI provides for indemnification in such case, or (ii) contribution under the Securities Act, the Exchange Act or otherwise may be required
on the part of any such Person in circumstances for which indemnification is provided under this Article VI, then, and in each such case,
the Company and each Underwriter, severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by said indemnity agreement incurred by the Company and such Underwriter, as incurred, in such proportions
that such Underwriter is responsible for that portion represented by the percentage that the underwriting discount appearing on the cover
page of the Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the balance; provided,
that, no Person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director,
officer and employee of such Underwriter or the Company, as applicable, and each Person, if any, who controls such Underwriter or the
Company, as applicable, within the meaning of Section 15 of the Securities Act shall have the same rights to contribution as such Underwriter
or the Company, as applicable. Notwithstanding the provisions of this Section 6.4, no Underwriter shall be required to contribute any
amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The Underwriters'
obligations in this Section 6.4 to contribute are several in proportion to their respective underwriting obligations and not joint.
(b)
Contribution Procedure. Within fifteen (15) days after receipt by any party to this Agreement (or its representative) of
notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be
made against another party (“contributing party”), notify the contributing party of the commencement thereof, but the
failure to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for
contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing
party or its representative of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to
participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not
be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking
contribution without the written consent of such contributing party. The contribution provisions contained in this Section 6.4 are intended
to supersede, to the extent permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available.
25
ARTICLE VII.
MISCELLANEOUS
7.1
Termination.
(a)
Termination Right. The Representative shall have the right to terminate this Agreement at any time prior to any Closing
Date, (i) if any domestic or international event or act or occurrence has materially disrupted, or in its opinion will in the immediate
future materially disrupt, general securities markets in the United States; or (ii) if trading on any Trading Market shall have been
suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities
shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction, or (iii) if
the United States shall have become involved in a new war or an increase in major hostilities, or (iv) if a banking moratorium has
been declared by a New York State or federal authority, or (v) if a moratorium on foreign exchange trading has been declared which
materially adversely impacts the United States securities markets, or (vi) if the Company shall have sustained a material loss by
fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall
have been insured, will, in the Representative’s opinion, make it inadvisable to proceed with the delivery of the Securities, or
(vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder, or (viii) if the
Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company,
or such adverse material change in general market conditions as in the Representative’s judgment would make it impracticable to
proceed with the offering, sale and/or delivery of the Securities or to enforce contracts made by the Underwriters for the sale of the
Securities.
(b)
Reserved.
(c)
Indemnification. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination
of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Article VI shall not be in any way effected
by such election or termination or failure to carry out the terms of this Agreement or any part hereof.
7.2
Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, the Preliminary Prospectus,
the Prospectus and the Prospectus Supplement, contain the entire understanding of the parties with respect to the subject matter hereof
and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge
have been merged into such documents, exhibits and schedules. Notwithstanding anything herein to the contrary, the Engagement Agreement,
dated March 17, 2026 (“Engagement Agreement”), by and between the Company and the Representative, shall continue to
be effective and the terms therein shall continue to survive and be enforceable by the Representative in accordance with its terms, provided
that, in the event of a conflict between the terms of the Engagement Agreement and this Agreement, the terms of this Agreement shall prevail.
7.3
Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall
be in writing and shall be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication
is delivered via e-mail attachment at the email address set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New
York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered
via e-mail attachment at the e-mail address as set forth on the signature pages attached hereto on a day that is not a Trading Day or
later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing,
if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required
to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto.
26
7.4
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written
instrument signed, in the case of an amendment, by the Company and the Representative. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default
or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right
hereunder in any manner impair the exercise of any such right.
7.5
Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed
to limit or affect any of the provisions hereof.
7.6
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns.
7.7
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles
of conflicts of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective
affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and
federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents),
and hereby irrevocably waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party
hereby irrevocably waives personal service of process and consents to process being served in any such Action or Proceeding by mailing
a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect
for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
If either party shall commence an Action or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the
obligations of the Company under Article VI, the prevailing party in such Action or Proceeding shall be reimbursed by the other party
for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of
such Action or Proceeding.
7.8
Survival. The representations and warranties contained herein shall survive the Closing and the Option Closing, if any,
and the delivery of the Securities.
7.9
Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party,
it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by e-mail delivery
of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such “.pdf” signature page were an original thereof.
7.10
Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially
reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by
such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.
27
7.11
Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of
damages, the Underwriters and the Company will be entitled to specific performance under the Transaction Documents. The parties agree
that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction
Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a
remedy at law would be adequate.
7.12
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any
right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next
succeeding Business Day.
7.13
Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to
revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition,
each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the
date of this Agreement.
7.14
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO
THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE FOREVER ANY RIGHT
TO TRIAL BY JURY.
(Signature Pages Follow)
28
If the foregoing correctly
sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among the Company and the several Underwriters in accordance with its terms.
Very truly yours,
PRECISION OPTICS CORPORATION, INC.
By: /s/ Wayne Coll
Name: Wayne Coll
Title: Chief Financial Officer
Address for Notice:
Precision Optics Corporation, Inc.
22 East Broadway
Gardner, Massachusetts 01440
Copy to:
ArentFox Schiff LLP
800 Boylston Street, 32nd Floor
Boston, MA 02199
Attn: Tom Brennan
e-mail: Thomas.brennan@afslaw.com
Accepted on the date first above written.
LUCID CAPITAL MARKETS, LLC
As the Representative of the several
Underwriters listed on Schedule I
By: LUCID CAPITAL MARKETS, LLC
By: /s/ John Lipman
Name: John Lipman
Title:Head of Capital Markets
Address for Notice:
Lucid Capital Markets, LLC
570 Lexington Avenue, 40th
Floor
New York, NY 10022
Attn: John Lipman
e-mail: JLipman@lucidcm.com
Copy to:
Ellenoff Grossman & Schole
1345 Avenue of the Americas
New York, New York 10105
Attn: Robert Charron
e-mail:
rcharron@egsllp.com
29
SCHEDULE I
Schedule
of Underwriters
Underwriters
Closing Shares
Closing Warrants
Closing Purchase Price
Lucid Capital Markets, LLC
2,777,777
0
$9,424,997.36
Total
2,777,777
0
$9,424,997.36
30
EX-4.1 — COMMON STOCK PURCHASE WARRANT
EX-4.1
Filename: poci_ex-0401.htm · Sequence: 3
Exhibit 4.1
NEITHER THIS SECURITY NOR THE SECURITIES FOR
WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY
STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
REPRESENTATIVE’S COMMON STOCK PURCHASE
WARRANT
PRECISION OPTICS CORPORATION,
INC.
Warrant Shares:
Initial Exercise Date: _________, 2026
THIS REPRESENTATIVE’S
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, _____________ or its assigns (the
“Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set
forth, at any time on or after the date hereof (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York
City Time) on [_______]1 (the “Termination
Date”) but not thereafter, to subscribe for and purchase from Precision Optics Corporation, Inc., a Massachusetts corporation
(the “Company”), up to ______ shares (as subject to adjustment hereunder, the “Warrant Shares”)
of Common Stock. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in
Section 2(b).
Section 1. Definitions.
In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated in this Section 1:
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Bid Price”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or
quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading
Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York
City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price
of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then
listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the Pink Open Market (or a similar
organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in
good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized
or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”
or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority
so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally
are open for use by customers on such day.
__________________
1
Insert the date that is the five year anniversary of the date of commencement of sales in the offering, provided that, if such date is
not a Trading Day, insert the immediately preceding Trading Day.
1
“Commission”
means the United States Securities and Exchange Commission.
“Common
Stock” means the common stock of the Company, par value $0.01 per share, and any other class of securities into which such securities
may hereafter be reclassified or changed.
“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is
at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Registration
Statement” means the Company’s registration statement on Form S-3 (File No. 333-280047).
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.
“Trading
Day” means a day on which the Common Stock is traded on a Trading Market.
“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, (or any successors to any of the foregoing).
“Transfer
Agent” means Computershare Trust Company, N.A., the current transfer agent of the Company, and any successor transfer agent
of the Company.
“Underwriting
Agreement” means the underwriting agreement, dated as of March [•], 2026, among the Company and Lucid Capital Markets,
LLC as representative of the underwriters named therein, as amended, modified or supplemented from time to time in accordance with its
terms.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or
quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock
is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the Pink Open Market
(or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common
Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser
selected in good faith by the holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.
2
“Warrants”
means this Warrant and other Representative Common Stock Purchase Warrants issued by the Company.
Section 2. Exercise.
a) Exercise of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any
time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed
PDF copy submitted by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the “Notice of Exercise”).
Within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined
in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the
shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the
cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice
of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise
be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to
the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in
which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which
the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the
total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable
hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing
the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise
on the Trading Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that,
by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant
Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
b) Exercise
Price. The exercise price per share of Common Stock under this Warrant shall be $[•]2,
subject to adjustment hereunder (the “Exercise Price”).
c) Cashless
Exercise. If at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained
therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may also be exercised, in whole or in
part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant
Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice
of Exercise if such Notice of Exercise is (1) delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) delivered
pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule 600(b)
of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the highest Bid Price of the Common Stock on
the principal Trading Market as reported by Bloomberg L.P. (“Bloomberg”) within two (2) hours of the time of the Holder’s
delivery of the Notice of Exercise pursuant to Section 2(a) hereof if such Notice of Exercise is delivered during “regular trading
hours,” or within two (2) hours after the close of “regular trading hours,” on a Trading Day or (iii) the VWAP on the
date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is delivered
pursuant to Section 2(a) hereof after two (2) hours following the close of “regular trading hours” on such Trading Day;
__________
[2]
Insert the Company’s most recent closing stock price prior to pricing the Offering.
3
(B) = the Exercise
Price of this Warrant, as adjusted hereunder; and
(X) = the number
of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were
by means of a cash exercise rather than a cashless exercise.
If Warrant Shares
are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act,
the holding period of the Warrant Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees not to
take any position contrary to this Section 2(c).
d) Mechanics of Exercise.
i. Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer
Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust
Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such
system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the
Warrant Shares by Holder or (B) the Warrant Shares are eligible for resale by the Holder
without volume or manner-of-sale limitations pursuant to Rule 144 (assuming cashless exercise of the Warrants), and otherwise
by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for
the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the
Notice of Exercise by the date that is the earlier of (i) one (1) Trading Day after the delivery to the Company of the Notice of Exercise
and (ii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise
(such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed
for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised,
irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the
case of a cashless exercise) is received within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising
the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder
the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash,
as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common
Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading
Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program
so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period” means the
standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect to the
Common Stock as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing, with respect to any Notice(s)
of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Initial Exercise Date, which may be delivered at any time
after the time of execution of the Underwriting Agreement, the Company agrees to deliver the Warrant Shares subject to such notice(s)
by 4:00 p.m. (New York City time) on the Initial Exercise Date and the Initial Exercise Date shall be the Warrant Share Delivery Date
for purposes hereunder, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received
by such Warrant Share Delivery Date.
ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and
upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing
the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other
respects be identical with this Warrant.
4
iii. Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant
to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if
the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section
2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by
its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares
of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon
such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x)
the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds
(y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection
with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B)
at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise
was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares
of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately
preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing
herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares
of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
v. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this
Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall,
at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the
Exercise Price or round up to the next whole share.
vi. Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and
such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when
surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company
shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii. Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
5
e) Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise
any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise
as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting
as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)),
would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence,
the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number
of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant
beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or
nonconverted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject
to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its
Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder,
it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section
13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the
extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation
to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is
exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s
determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates
and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation,
and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to
any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder
may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report
filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice
by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request
of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number of shares of Common Stock
then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the
conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since
the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of shares of Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice
to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial
Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect
to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall
continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such
notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent
with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly
give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
6
Section 3. Certain
Adjustments.
a) Stock
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes
a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of
Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse
stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the
Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which
the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of
shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for
the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or re-classification.
b) [RESERVED]
c) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells
any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to all of the record holders
of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon
the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held
the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent that
the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of
Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for
the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
d) Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution
of its assets (or rights to acquire its assets) to all of the holders of shares of Common Stock, by way of return of capital or otherwise,
other than cash (including, without limitation, any distribution of stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, that, to the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding
the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in
the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder
exceeding the Beneficial Ownership Limitation).
7
e) Fundamental
Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions
effects any merger or consolidation of the Company with or into another Person, (ii) the Company or any Subsidiary, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in
one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the
Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares
for other securities, cash or property and has been accepted by the holders of greater than 50% of the outstanding Common Stock or greater
than 50% of the voting power of the common equity of the Company, (iv) the Company, directly or indirectly, in one or more related transactions
effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which
the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly,
in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires greater than 50% of the outstanding shares of Common Stock or greater than 50% of the voting power
of the common equity of the Company (each a “Fundamental Transaction”), then, upon any subsequent exercise of this
Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately
prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2(e)
on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if
it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a
result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately
prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes
of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration
based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and
the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value
of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash
or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration
it receives upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in
a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all
of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(e) pursuant to written agreements
in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental
Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity
evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding
number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable
and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental
Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account
the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock,
such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant
immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to
the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall be added to the term “Company”
under this Warrant (so that from and after the occurrence or consummation of such Fundamental Transaction, each and every provision of
this Warrant and the other Transaction Documents referring to the “Company” shall refer instead to each of the Company and
the Successor Entity or Successor Entities, jointly and severally), and the Successor Entity or Successor Entities, jointly and severally
with the Company, may exercise every right and power of the Company prior thereto and the Successor Entity or Successor Entities shall
assume all of the obligations of the Company prior thereto under this Warrant and the other Transaction Documents with the same effect
as if the Company and such Successor Entity or Successor Entities, jointly and severally, had been named as the Company herein. For the
avoidance of doubt, the Holder shall be entitled to the benefits of the provisions of this Section 3(e) regardless of (i) whether the
Company has sufficient authorized shares of Common Stock for the issuance of Warrant Shares and/or (ii) whether a Fundamental Transaction
occurs prior to the Initial Exercise Date.
8
f) Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes
of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the
number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
g) Notice
to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company
shall promptly deliver to the Holder by email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form)
on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of
capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with
any reclassification of the Common Stock, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any
sale or transfer of all or substantially all of its assets, or any compulsory share exchange whereby the Common Stock is converted into
other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding
up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by email to the Holder at its last email
address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective
date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution,
redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be
entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification,
consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected
that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to
deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to
be specified in such notice. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such
notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
Section 4. Transfer
of Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth
in Section 4(d) hereof, this Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable,
in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written
assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient
to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not
so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required
to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall
surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the
Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for
the purchase of Warrant Shares without having a new Warrant issued.
9
b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company,
together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or
its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of this Warrant and
shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose
(the “Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat
the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
d)
Transfer Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant,
the transfer of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities
Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions
or current public information requirements pursuant to Rule 144.
e)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to
or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.
Section 5. Miscellaneous.
a) No
Rights as Stockholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends
or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set
forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to
Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required
to net cash settle an exercise of this Warrant.
b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case
of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include
the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make
and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.
c) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted
herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
10
d) Authorized
Shares.
The Company covenants
that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number
of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further
covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the
necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action
as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation,
or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares
which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented
by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously with such issue).
Except and to the
extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate
of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate
to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the
Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior
to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts
to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary
to enable the Company to perform its obligations under this Warrant.
Before taking any
action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price,
the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory
body or bodies having jurisdiction thereof.
e) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and
construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of
law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders,
partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York.
Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York,
Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is
not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient
venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery)
to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any
other manner permitted by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant,
the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys’
fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
11
f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not
utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
g) Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as
a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of
this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material
damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including,
but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting
any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h) Notices.
Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any
Notice of Exercise, shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service,
addressed to the Company, at 22 East Broadway, Gardner, Massachusetts 01440, Attention: Wayne Coll, email address:wcoll@poci.com, or
such other email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other
communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by e-mail, or sent
by a nationally recognized overnight courier service addressed to each Holder at the e-mail address or address of such Holder appearing
on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest
of (i) the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section
prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication
is delivered via e-mail at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New
York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized
overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any
notice provided hereunder constitutes, or contains, non-public information regarding the Company or any Subsidiaries, the Company shall
simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.
a)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the
Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.
b)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
c)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby
shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted
assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.
d)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company,
on the one hand, and the Holder or the beneficial owner of this Warrant, on the other hand.
12
e)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
f)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant.
(Signature Page Follows)
13
IN WITNESS WHEREOF, the Company
has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
PRECISION OPTICS CORPORATION,
INC.
By:__________________________________________
Name:
Title:
14
NOTICE OF EXERCISE
To: PRECISION
OPTICS CORPORATION, INC.
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant
(only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes,
if any.
(2)
Payment shall take the form of (check applicable box):
[ ] in lawful money
of the United States; or
[ ] if permitted the
cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise
this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in
subsection 2(c).
(3)
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
_______________________________
The Warrant Shares shall be delivered to the following
DWAC Account Number:
_______________________________
_______________________________
_______________________________
[SIGNATURE
OF HOLDER]
Name of Investing Entity: _______________________________________________________________________
Signature of Authorized Signatory of Investing
Entity: _________________________________________________
Name of Authorized Signatory: ___________________________________________________________________
Title of Authorized Signatory: ____________________________________________________________________
Date: _______________________________________________________________________________________
15
ASSIGNMENT FORM
(To assign the foregoing
Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing
Warrant and all rights evidenced thereby are hereby assigned to
Name:
(Please Print)
Address:
Phone Number:
Email Address:
(Please Print)
______________________________________
______________________________________
Dated: _______________ __, ______
Holder’s Signature:___________________________
Holder’s Address:____________________________
16
EX-99.1 — PRESS RELEASE
EX-99.1
Filename: poci_ex9901.htm · Sequence: 4
Exhibit 99.1
Precision Optics Corporation, Inc. Announces
Proposed Public Offering of Common Stock
GARDNER, Mass., March
26, 2026 — Precision Optics Corporation, Inc. (NASDAQ: POCI), a leading designer and manufacturer of advanced optical instruments
for the medical and defense/aerospace industries, today announced that it is commencing an underwritten public offering of shares of its
common stock (or common stock equivalents). The offering is subject to market conditions, and there can be no assurance as to whether
or when the offering may be completed, or as to the actual size or terms of the offering.
Lucid Capital Markets
is acting as the sole book-running manager for the offering.
The offering is being
made pursuant to a shelf registration statement on Form S-3 (File No. 333-280047) filed with the Securities and Exchange Commission (“SEC”)
on June 7, 2024, as amended on June 11, 2024, and declared effective by the SEC on June 14, 2024.
A preliminary prospectus
supplement and accompanying prospectus relating to the offering will be filed with the SEC and will be available on the SEC’s website
at www.sec.gov. Copies of the preliminary prospectus supplement and accompanying prospectus relating to the offering, when available,
may also be obtained by contacting Lucid Capital Markets, LLC, 570 Lexington Avenue, 40th Floor, New York, NY 10022.
This press release shall
not constitute an offer to sell or the solicitation of an offer to buy any securities nor will there be any sale of these securities in
any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under
the securities laws of any such state or other jurisdiction.
About Precision Optics Corporation
Founded in 1982, Precision
Optics is a vertically integrated optics company primarily focused on leveraging its proprietary micro-optics, 3D imaging and digital
imaging technologies to the healthcare and defense/aerospace industries by providing services ranging from new product concept through
mass manufacture. Utilizing its leading-edge in-house design, prototype, regulatory and fabrication capabilities as well as its Ross Optical
division's high volume world-wide sourcing, inspecting and production resources, the Company is able to design and manufacture next-generation
product solutions to the most challenging customer requirements. Within healthcare, Precision Optics enables next generation medical device
companies around the world to meet the increasing demands of the surgical community who require more enhanced and smaller imaging systems
for minimally invasive surgery as well as 3D endoscopy systems to support the rapid proliferation of surgical robotic systems. In addition
to these next generation applications, Precision Optics has supplied top tier medical device companies a wide variety of optical products
for decades, including complex endocouplers and specialized endoscopes. The Company is also leveraging its technical proficiency in micro-optics
to enable leading edge defense/aerospace applications which require the highest quality standards and the optimization of size, weight
and power.
1
Forward-Looking Statements:
This press release contains forward-looking statements
within the meaning of U.S. federal securities laws. Any statements contained herein that are not statements of historical fact may be
deemed to be forward-looking statements. In addition, any statements that refer to projections, forecasts, or other characterizations
of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “intends,”
“may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,”
“should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words
does not mean that a statement is not forward-looking. Forward-looking statements in this press release include, without limitation, the
Company’s ability to complete an offering and the timing of any offering. The forward-looking statements contained in this press
release are based on certain assumptions and analyses made by the management of the Company in light of their respective experience and
perception of historical trends, current conditions, and expected future developments and their potential effects on the Company as well
as other factors they believe are appropriate in the circumstances. There can be no assurance that future developments affecting the Company
will be those anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control
of the parties), or other assumptions that may cause actual results or performance to be materially different from those expressed or
implied by these forward-looking statements, including the demand for the Company’s products, global supply chains and economic
activity in general and other risks and uncertainties identified in the Company’s filings with the SEC. Should one or more of these
risks or uncertainties materialize or should any of the assumptions being made prove incorrect, actual results may vary in material respects
from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.
Company Contact:
PRECISION OPTICS CORPORATION
22 East Broadway
Gardner, Massachusetts 01440-3338
Telephone: 978-630-1800
Investor Contact:
LYTHAM PARTNERS, LLC
Robert Blum
Telephone: 602-889-9700
poci@lythampartners.com
2
EX-99.2 — PRESS RELEASE
EX-99.2
Filename: poci_ex9902.htm · Sequence: 5
Exhibit 99.2
Precision Optics Corporation, Inc. Announces
Pricing of Upsized $10 Million Public Offering of Common Stock
GARDNER, Mass., March
27, 2026 — Precision Optics Corporation, Inc. (NASDAQ: POCI), a leading designer and manufacturer of advanced optical instruments
for the medical and defense/aerospace industries, today announced the pricing of its previously announced underwritten public offering
of 2,777,777 shares of its common stock at a public offering price of $3.60 per share, before deducting underwriting discounts and commissions
and offering expenses.
The oversubscribed offering
was led by a mix of existing and new fundamental institutional investors and included participation from directors, officers and executive
management of the company including Dr. Joseph N. Forkey, the company’s President, Chief Executive Officer and member of its Board
of Directors, Wayne Coll, the company’s Chief Financial Officer, and Joseph Traut, the company’s Chief Operating Officer,
who each purchased shares of common stock in this offering at the public offering price and on the same terms as the other purchasers
in this offering.
Lucid Capital Markets
is acting as the sole book-running manager for the offering.
All of the shares of
common stock to be sold in the offering will be sold by the Company. In addition, the Company has granted the underwriter a 45-day option
to purchase up to an additional 416,667 shares of its common stock at the public offering price less the underwriting discounts and commissions.
The offering is expected to close on or about March 30, 2026, subject to customary closing conditions.
The Company intends to
use net proceeds from this offering for working capital and general corporate purposes. The offering is being made pursuant to a shelf
registration statement on Form S-3 (File No. 333-280047) filed with the Securities and Exchange Commission (“SEC”) on June
7, 2024, as amended on June 11, 2024, and declared effective by the SEC on June 14, 2024.
A preliminary prospectus
supplement and accompanying prospectus relating to the offering have been filed with the SEC and are available on the SEC’s website
at www.sec.gov. A final prospectus supplement will be filed with the SEC. Copies of the final prospectus supplement and accompanying prospectus
relating to the offering, when available, may also be obtained by contacting Lucid Capital Markets, LLC, 570 Lexington Avenue, 40th Floor,
New York, NY 10022.
This press release shall
not constitute an offer to sell or the solicitation of an offer to buy any securities nor will there be any sale of these securities in
any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under
the securities laws of any such state or other jurisdiction.
About Precision Optics Corporation
Founded in 1982, Precision
Optics is a vertically integrated optics company primarily focused on leveraging its proprietary micro-optics, 3D imaging and digital
imaging technologies to the healthcare and defense/aerospace industries by providing services ranging from new product concept through
mass manufacture. Utilizing its leading-edge in-house design, prototype, regulatory and fabrication capabilities as well as its Ross Optical
division's high volume world-wide sourcing, inspecting and production resources, the Company is able to design and manufacture next-generation
product solutions to the most challenging customer requirements. Within healthcare, Precision Optics enables next generation medical device
companies around the world to meet the increasing demands of the surgical community who require more enhanced and smaller imaging systems
for minimally invasive surgery as well as 3D endoscopy systems to support the rapid proliferation of surgical robotic systems. In addition
to these next generation applications, Precision Optics has supplied top tier medical device companies a wide variety of optical products
for decades, including complex endocouplers and specialized endoscopes. The Company is also leveraging its technical proficiency in micro-optics
to enable leading edge defense/aerospace applications which require the highest quality standards and the optimization of size, weight
and power.
1
Forward-Looking Statements:
This press release contains forward-looking statements
within the meaning of U.S. federal securities laws. Any statements contained herein that are not statements of historical fact may be
deemed to be forward-looking statements. In addition, any statements that refer to projections, forecasts, or other characterizations
of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,”
“believe,” “continue,” “could,” “estimate,” “expect,” “intends,”
“may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,”
“should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words
does not mean that a statement is not forward-looking. Forward-looking statements in this press release include, without limitation, the
Company’s ability to complete the offering and the use of proceeds of the offering. The forward-looking statements contained in
this press release are based on certain assumptions and analyses made by the management of the Company in light of their respective experience
and perception of historical trends, current conditions, and expected future developments and their potential effects on the Company as
well as other factors they believe are appropriate in the circumstances. There can be no assurance that future developments affecting
the Company will be those anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond
the control of the parties), or other assumptions that may cause actual results or performance to be materially different from those expressed
or implied by these forward-looking statements, including the demand for the Company’s products, global supply chains and economic
activity in general and other risks and uncertainties identified in the Company’s filings with the SEC. Should one or more of these
risks or uncertainties materialize or should any of the assumptions being made prove incorrect, actual results may vary in material respects
from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.
Company Contact:
PRECISION OPTICS CORPORATION
22 East Broadway
Gardner, Massachusetts 01440-3338
Telephone: 978-630-1800
Investor Contact:
LYTHAM PARTNERS, LLC
Robert Blum
Telephone: 602-889-9700
poci@lythampartners.com
2
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Commission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.
+ References
No definition available.
+ Details
Name:
dei_EntityFileNumber
Namespace Prefix:
dei_
Data Type:
dei:fileNumberItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Two-character EDGAR code representing the state or country of incorporation.
+ References
No definition available.
+ Details
Name:
dei_EntityIncorporationStateCountryCode
Namespace Prefix:
dei_
Data Type:
dei:edgarStateCountryItemType
Balance Type:
na
Period Type:
duration
X
- Definition
The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
+ Details
Name:
dei_EntityRegistrantName
Namespace Prefix:
dei_
Data Type:
xbrli:normalizedStringItemType
Balance Type:
na
Period Type:
duration
X
- Definition
The Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
+ Details
Name:
dei_EntityTaxIdentificationNumber
Namespace Prefix:
dei_
Data Type:
dei:employerIdItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Local phone number for entity.
+ References
No definition available.
+ Details
Name:
dei_LocalPhoneNumber
Namespace Prefix:
dei_
Data Type:
xbrli:normalizedStringItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 13e
-Subsection 4c
+ Details
Name:
dei_PreCommencementIssuerTenderOffer
Namespace Prefix:
dei_
Data Type:
xbrli:booleanItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14d
-Subsection 2b
+ Details
Name:
dei_PreCommencementTenderOffer
Namespace Prefix:
dei_
Data Type:
xbrli:booleanItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Title of a 12(b) registered security.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b
+ Details
Name:
dei_Security12bTitle
Namespace Prefix:
dei_
Data Type:
dei:securityTitleItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Name of the Exchange on which a security is registered.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection d1-1
+ Details
Name:
dei_SecurityExchangeName
Namespace Prefix:
dei_
Data Type:
dei:edgarExchangeCodeItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14a
-Subsection 12
+ Details
Name:
dei_SolicitingMaterial
Namespace Prefix:
dei_
Data Type:
xbrli:booleanItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Trading symbol of an instrument as listed on an exchange.
+ References
No definition available.
+ Details
Name:
dei_TradingSymbol
Namespace Prefix:
dei_
Data Type:
dei:tradingSymbolItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
+ Details
Name:
dei_WrittenCommunications
Namespace Prefix:
dei_
Data Type:
xbrli:booleanItemType
Balance Type:
na
Period Type:
duration