Form 8-K
8-K — DUOS TECHNOLOGIES GROUP, INC.
Accession: 0001079973-26-000851
Filed: 2026-06-17
Period: 2026-06-17
CIK: 0001396536
SIC: 7372 (SERVICES-PREPACKAGED SOFTWARE)
Item: Entry into a Material Definitive Agreement
Item: Other Events
Item: Financial Statements and Exhibits
Documents
8-K — duot_8k.htm (Primary)
EX-1.1 — EXHIBIT 1.1 (ex1x1.htm)
EX-4.1 — EXHIBIT 4.1 (ex4x1.htm)
EX-5.1 — OPINION OF SHUTTS & BOWEN LLP (ex5x1.htm)
EX-99.1 — PRESS RELEASE (ex99x1.htm)
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8-K — FORM 8-K
8-K (Primary)
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0001396536
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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):
June 17, 2026
——————
Duos Technologies Group, Inc.
(Exact name of registrant as specified in its
charter)
——————
Florida
001-39227
65-0493217
(State or Other Jurisdiction
(Commission
(I.R.S. Employer
of Incorporation)
File Number)
Identification No.)
7660 Centurion Parkway, Suite 100, Jacksonville,
Florida 32256
(Address of Principal Executive Offices) (Zip
Code)
(904) 296-2807
(Registrant’s telephone number, including
area code)
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:
☐
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 $0.001 per share)
DUOT
The Nasdaq Stock Market LLC
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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
On June 17, 2026, Duos Technologies Group, Inc. (the
“Company) announced an underwritten registered direct offering (the “Offering”) of 2,000,000 shares of common stock,
par value $0.001 per share (“the “Common Stock”), and 3,800,00 Pre-Funded Warrants (the “Pre-Funded Warrants”)
at a price of $9.50 per share or Pre-Funded Warrant for total gross proceeds of approximately $55 million, before deducting underwriting
discounts, commissions and offering expenses. The securities were offered and sold by the Company, pursuant to an effective shelf registration
statement on Form S-3, which was initially filed with the Securities and Exchange Commission on February 11, 2026 (File No. 333-293372),
and the base prospectus dated February 12, 2026, as supplemented by the prospectus supplement dated June 17, 2026 (the “Prospectus
Supplement”) pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the “Securities Act”). The Offering
is expected to close on June 18, 2026.
TD Cowen acted as lead bookrunner on the transaction.
Cantor acted as joint bookrunner on the transaction.
The Offering was conducted pursuant
to an underwriting agreement (the “Agreement”) between the Company and TD Securities USA LLC, as representative of the Underwriters
named therein (the “Underwriters”), that was entered into on June 17, 2026. The Agreement contains customary representations,
warranties, and agreements of us. The Company also agreed in the Agreement to indemnify the Underwriters against certain liabilities.
The material terms of the Offering are described
in the Registration Statement and the Prospectus Supplement. Each Pre-Funded Warrant has an exercise price of $0.001, subject to adjustment.
The Pre-Funded Warrants are exercisable immediately, in whole or in part, provided, that a holder (together with its affiliates) may
not exercise any portion of such holder’s Pre-Funded Warrant to the extent that the holder would own more than 4.99% of the outstanding
shares of Common Stock immediately after exercise, except that upon at least 61 days’ prior written notice from the holder, the
holder may increase or decrease the amount of ownership of outstanding shares of Common Stock after exercising the holder’s Pre-Funded
Warranty up to 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage
ownership is determined in accordance with the terms of the Pre-Funded Warrants. If at the time of exercise, there is no effective registration
statement registering the issuance of shares of Common Stock upon exercise of the Pre-Funded Warrant, the holder may elect to exercise
the Pre-Funded Warrant on a cashless basis, as provided therein. In the event of any fundamental transaction, as described in the Pre-Funded
Warrants, the holder will have the right to receive as alternative consideration, for each share of Common Stock that would have been
issuable upon exercise immediately prior to such fundamental transaction, the number of shares of the successor or acquiring corporation,
or the Company, if it is the survivor, and any additional consideration receivable upon or as a result of such transaction by a holder
of the number of shares of Common Stock for which the Pre-Funded Warrant is exercisable immediately prior to such event.
The foregoing descriptions of the Agreement and the Pre-Funded Warrant are not complete and are
qualified in their entirety by reference to the full text of the Agreement and the form of Pre-Funded Warrant, copies of which are filed
as Exhibits 1.1 and 4.1, respectively to this Current Report on Form 8-K and are incorporated herein by reference.
The
legal opinion and consent of Shutts & Bowen LLP relating to the securities is filed as Exhibit 5.1 to this Current Report on Form
8-K and is incorporated herein by reference.
Item 8.01 Other Events.
On
June 17, 2026, the Company issued a press release, related to the Offering. A copy of the press release is filed as Exhibit
99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.
Description of Exhibit
1.1
Underwriting
Agreement, dated June 17, 2026, between Duos Technologies Group, Inc. and TD Securities (USA) LLC, as Representative
4.1
Form of Pre-Funded Warrant
5.1
Opinion of Shutts & Bowen LLP
23.1
Consent of Shutts & Bowen LLP (included in Exhibit 5.1)
99.1
Press Release, dated June 17, 2026, regarding the Offering.
104
Cover Page Interactive Data File
(formatted as Inline XBRL and contained in Exhibit 101)
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.
DUOS TECHNOLOGIES GROUP, INC.
Dated: June 17, 2026
By:
/s/ Adrian G. Goldfarb
Adrian G. Goldfarb
Interim Chief Financial Officer
EX-1.1 — EXHIBIT 1.1
EX-1.1
Filename: ex1x1.htm · Sequence: 2
EXHIBIT 1.1
Duos
Technologies Group, Inc.
2,000,000 SHARES OF COMMON STOCK, PAR VALUE
$0.001 PER SHARE
PRE-FUNDED WARRANTS TO PURCHASE 3,800,000 SHARES
OF COMMON STOCK, PAR VALUE $0.001 PER SHARE
__________________________
Underwriting Agreement
June 17, 2026
TD Securities (USA) LLC
As the Representative of the several Underwriters
listed in Schedule A hereto
c/o TD Securities (USA) LLC
1 Vanderbilt Avenue
New York, New York 10017
Ladies and Gentlemen:
Duos Technologies Group, Inc.,
a Florida corporation (the “Company”), confirms its agreement with TD Securities (USA) LLC (“TD Cowen”),
and each of the other Underwriters named in Schedule A hereto (collectively, the “Underwriters,” which term
shall also include any underwriter substituted as hereinafter provided in Section 10 hereof), for which TD Cowen is acting as representative
(in such capacity, the “Representative”), with respect to the sale by the Company and the purchase by the Underwriters,
acting severally and not jointly, of the respective numbers of (a) shares of common stock, par value $0.001 per share, of the Company
(“Common Stock”), as set forth in Schedule A hereto; and (b) pre-funded warrants to purchase up to the number of shares
of the Common Stock, as set forth in Schedule A hereto (the “Pre-Funded Warrants”), at an exercise price set forth
in Schedule A hereto. The aforesaid 2,000,000 shares of Common Stock (the “Closing Shares”) and the Pre-Funded Warrants
to be purchased by the Underwriters are herein collectively referred to as the “Securities.” The shares of the Company’s
Common Stock issuable upon exercise of the Pre-Funded Warrants are hereinafter referred to as the “Prefunded Warrant Shares.”
The Company has filed with
the Securities and Exchange Commission (the “Commission”) a shelf registration statement on Form S-3 (No. 333-293372),
covering the public offering and sale of certain securities, including the Securities and Prefunded Warrant Shares, under the Securities
Act of 1933, as amended (the “1933 Act”) and the rules and regulations of the Commission promulgated thereunder (the
“1933 Act Regulations”), which shelf registration statement was declared effective on February 12, 2026. Such registration
statement, as of any time, means such registration statement as amended by any post-effective amendments thereto to such time, including
the exhibits and any schedules thereto at such time, the documents incorporated or deemed to be incorporated by reference therein at such
time pursuant to Item 12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be a part thereof as of such time pursuant
to Rule 430B under the 1933 Act Regulations (“Rule 430B”), and is referred to herein as the “Registration Statement”;
provided, however, that the “Registration Statement” without reference to a time means such registration statement as amended
by any post-effective amendments thereto as of the time of the first contract of sale for the Securities and Prefunded Warrant Shares,
which time shall be considered the “new effective date” of such registration statement with respect to the Securities and
Prefunded Warrant Shares within the meaning of paragraph (f)(2) of Rule 430B, including the exhibits and schedules thereto as of such
time, the documents incorporated or deemed incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933
Act and the documents otherwise deemed to be a part thereof as of such time pursuant to the Rule 430B. Any registration statement filed
pursuant to Rule 462(b) of the 1933 Act Regulations in connection with the offer and sale of the Securities and Prefunded Warrant Shares
is herein called the “Rule 462(b) Registration Statement” and, after such filing, the term “Registration Statement”
shall include the Rule 462(b) Registration Statement. Each preliminary prospectus supplement, if any, used in connection with the offering
of the Securities and Prefunded Warrant Shares, including the documents incorporated or deemed to be incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as a “preliminary prospectus.” Promptly
after execution and delivery of this Agreement, the Company will prepare and file a final prospectus supplement relating to the Securities
and Prefunded Warrant Shares in accordance with the provisions of Rule 424(b) under the 1933 Act Regulations (“Rule 424(b)”).
The final prospectus supplement, in the form first furnished or made available to the Underwriters for use in connection with the offering
of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to Item 12 of Form
S-3 under the 1933 Act, are collectively referred to herein as the “Prospectus.” For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall
be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (or any
successor system) (“EDGAR”).
As used in this Agreement:
“Applicable Time”
means 7:00 A.M. New York City time, on June 17, 2026 or such other time as agreed by the Company and the Representative.
“General Disclosure
Package” means any Issuer General Use Free Writing Prospectuses issued at or prior to the Applicable Time, the most recent preliminary
prospectus, if any, (including any documents incorporated therein by reference) that is distributed to investors prior to the Applicable
Time and the information included on Schedule B-1 hereto, all considered together.
“Issuer Free Writing
Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 of the 1933 Act Regulations (“Rule
433”), including without limitation any “free writing prospectus” (as defined in Rule 405 of the 1933 Act Regulations
(“Rule 405”)) relating to the Securities that is (i) required to be filed with the Commission by the Company, (ii)
a “road show for an offering that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required
to be filed with the Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description
of the Securities or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with
the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g).
“Issuer General Use
Free Writing Prospectus” means any Issuer Free Writing Prospectus that is intended for general distribution to prospective investors
(other than a “bona fide electronic road show,” as defined in Rule 433 (a “Bona Fide Electronic Road Show”)),
as evidenced by its being specified in Schedule B-2 hereto.
“Issuer Limited Use
Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.
“Testing-the-Waters
Communication” means any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the
1933 Act.
“Written Testing-the-Waters
Communication” means any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under
the 1933 Act.
All references in this Agreement
to financial statements and schedules and other information which is “contained,” “included” or “stated”
(or other references of like import) in the Registration Statement, any preliminary prospectus or the Prospectus shall be deemed to include
all such financial statements and schedules and other information incorporated or deemed incorporated by reference in the Registration
Statement, any preliminary prospectus or the Prospectus, as the case may be, prior to the execution and delivery of this Agreement; and
all references in this Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus or the Prospectus
shall be deemed to include the filing of any document under the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder (collectively, the “1934 Act”), incorporated or deemed to be incorporated by reference in the
Registration Statement, such preliminary prospectus or the Prospectus, as the case may be, at or after the execution and delivery of this
Agreement.
2
SECTION 1.
Representations and Warranties by the Company. The Company represents and warrants to each Underwriter as of the date hereof,
the Applicable Time, the Closing Time (as defined below), and agrees with each Underwriter, as follows:
(a)
Registration Statement and Prospectuses. The Company meets the requirements for use of Form S-3 under the 1933 Act. Each
of the Registration Statement and any amendment thereto has become effective under the 1933 Act, including General Instruction I.B.1 of
Form S-3. The aggregate market value of the outstanding voting and non-voting common equity (as defined in 1933 Act Rule 405) of the Company
held by persons other than affiliates of the Company (pursuant to 1933 Act Rule 144, those that directly, or indirectly through one or
more intermediaries, control, or are controlled by, or are under common control with, the Company) (the “Non-Affiliate Shares”),
was equal to more than $75 million (calculated by multiplying (x) the highest price at which the common equity of the Company closed on
Nasdaq within 60 days of the date of this Agreement times (y) the number of Non-Affiliate Shares). The Company is not a shell company
(as defined in Rule 405 under the 1933 Act) and has not been a shell company for at least 12 calendar months previously and if it has
been a shell company at any time previously, has filed current Form 10 information (as defined in Instruction I.B.6 of Form S-3) with
the Commission at least 12 calendar months previously reflecting its status as an entity that is not a shell company. No stop order suspending
the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued by the Commission under the 1933
Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued by the Commission and no
proceedings for any of those purposes have been instituted by the Commission or are pending or, to the Company’s knowledge, contemplated
by the Commission. The Company has complied with each request (if any) from the Commission for additional information.
Each of the Registration Statement
and any post-effective amendment thereto, at the time of its effectiveness and at each deemed effective date with respect to the Underwriters
pursuant to Rule 430B(f)(2) under the 1933 Act Regulations, complied in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations. Each preliminary prospectus, the Prospectus and any amendment or supplement thereto, at the time each was filed
with the Commission, complied in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations. Each preliminary
prospectus, if any, delivered to the Underwriters for use in connection with the offering and the Prospectus was or will be identical
to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
The documents incorporated
or deemed to be incorporated by reference in the Registration Statement and the Prospectus, when they became effective or at the time
they were or hereafter are filed with the Commission, complied and will comply in all material respects with the requirements of the 1934
Act and the rules and regulations of the Commission under the 1934 Act (the “1934 Act Regulations”).
The Registration Statement,
any preliminary prospectus and the Prospectus, and the filing of the Registration Statement, any preliminary prospectus and the Prospectus
with the Commission have been duly authorized by and on behalf of the Company, and the Registration Statement has been duly executed pursuant
to such authorization.
(b)
Accurate Disclosure. Neither the Registration Statement nor any amendment thereto, at its effective time, at the Closing
Time, contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit to state a material fact
required to be stated therein or necessary to make the statements therein not misleading. As of the Applicable Time, none of (A) the General
Disclosure Package, (B) any individual Issuer Limited Use Free Writing Prospectus, when considered together with the General Disclosure
Package, nor (C) any individual Written Testing-the-Waters Communication, when considered together with the General Disclosure Package,
included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Neither the Prospectus
nor any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time of any filing with the Commission
pursuant to Rule 424(b), at the Closing Time, included, includes or will include an untrue statement of a material fact or omitted, omits
or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the
General Disclosure Package and the Prospectus, at the time the Registration Statement became effective or when such documents incorporated
by reference were filed with the Commission, as the case may be, when read together with the other information in the Registration Statement,
the General Disclosure Package or the Prospectus, as the case may be, did not and will not include an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
3
The representations and warranties
in this subsection shall not apply to statements in or omissions from the Registration Statement (or any amendment thereto), the General
Disclosure Package or the Prospectus (or any amendment or supplement thereto, including any prospectus wrapper) made in reliance upon
and in conformity with written information furnished to the Company by any Underwriter through the Representative expressly for use therein.
For purposes of this Agreement, the only information so furnished shall be the information in the first paragraph under the caption “Discounts
and Commissions,” the statements under the caption “Stabilization,” the statements under the caption “Passive
Market Making” and the statements related specifically to the Representative in the third paragraph under the caption “Lock-Up
Agreements,” in each case contained under the caption “Underwriting” in each case contained in the Prospectus (collectively,
the “Underwriter Information”).
(c)
Issuer Free Writing Prospectuses. No Issuer Free Writing Prospectus conflicts or will conflict with the information contained
in the Registration Statement or the Prospectus, including any document incorporated by reference therein, and any preliminary or other
prospectus deemed to be a part thereof that has not been superseded or modified. No filing of any “road show” (as defined
in Rule 433(h)) is required in connection with the offering of the Securities and Prefunded Warrant Shares. Any Issuer Free Writing Prospectus
that the Company is required to file pursuant to Rule 433(d) under the 1933 Act has been, or will be, filed with the Commission in accordance
with the requirements of the 1933 Act and the 1933 Act Regulations. Each Issuer Free Writing Prospectus that the Company has filed, or
is required to file, pursuant to Rule 433(d) under the 1933 Act or that was prepared by or on behalf of or used or referred to by the
Company complies or will comply in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations. Except for
the Issuer Free Writing Prospectuses, if any, identified in Schedule B-2 hereto, and electronic road shows, if any, each furnished
to the Representative before first use, the Company has not prepared, used or referred to, and will not, without the prior consent of
the Representative, prepare, use or refer to, any issuer free writing prospectus.
(d)
Testing-the-Waters Materials. The Company (A) has not engaged in any Testing-the-Waters Communication other than Testing-the-Waters
Communications with the consent of the Representative with entities that are qualified institutional buyers within the meaning of Rule
144A under the 1933 Act or institutions that are accredited investors within the meaning of Rule 501 under the 1933 Act and (B) has not
authorized anyone other than the Representative to engage in Testing-the-Waters Communications. The Company reconfirms that the Representative
has been authorized to act on its behalf in undertaking Testing-the-Waters Communications.
(e)
Company Not Ineligible Issuer. At the time of filing the Registration Statement and any post-effective amendment thereto,
at the earliest time thereafter that the Company or another offering participant made a bona fide offer (within the meaning of
Rule 164(h)(2) of the 1933 Act Regulations) of the Securities and Prefunded Warrant Shares and at the date hereof, the Company was not
and is not an “ineligible issuer,” as defined in Rule 405, without taking account of any determination by the Commission pursuant
to Rule 405 that it is not necessary that the Company be considered an ineligible issuer.
(f)
[Intentionally omitted]
(g)
Independent Accountants. Salberg & Company, P.A., the accounting firm that certified the financial statements and supporting
schedules of the Company that are incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus,
is an independent registered public accounting firm as required by the 1933 Act, the 1933 Act Regulations, the 1934 Act, the 1934 Act
Regulations and the Public Company Accounting Oversight Board (United States).
(h)
SEC Reports. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by
the Company under the 1933 Act and the 1934 Act, including pursuant to Section 13(a) or 15(d) thereof, for the twelve months preceding
the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein, together with the Prospectus, 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 1933 Act and the 1934 Act, as applicable, and none of the SEC Reports, when filed, contained
any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not misleading. The Company has never been an issuer
subject to Rule 144(i) under the 1933 Act.
4
(i)
Financial Statements; Non-GAAP Financial Measures. The financial statements (including the related notes thereto) of the
Company included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, together
with the related schedules and notes, comply as to form in all material respects with Regulation S-X under the 1933 Act and present fairly,
in all material respects, the financial position of the Company and its consolidated Subsidiaries (as defined below) at the dates indicated
and the statement of operations, stockholders’ equity and cash flows of the Company and its consolidated Subsidiaries for the periods
specified; said financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”)
applied on a consistent basis throughout the periods covered thereby, except in the case of unaudited interim financial statements, which
are subject to normal year-end adjustments and do not contain certain footnotes as permitted by the applicable rules of the Commission,
and any supporting schedules, if any, present fairly, in all material respects, the information required to be stated therein. The selected
financial data and the summary financial information, if any, and other financial data included or incorporated by reference in the Registration
Statement, the General Disclosure Package and the Prospectus has been derived from the accounting records of the Company and present fairly,
in all material respects, the information shown therein and have been compiled on a basis consistent with that of the audited financial
statements included therein. Except as included therein, no historical or pro forma financial statements or supporting schedules are required
to be included or incorporated by reference in the Registration Statement, the General Disclosure Package or the Prospectus under the
1933 Act or the 1933 Act Regulations. All disclosures contained in the Registration Statement, the General Disclosure Package or the Prospectus,
or incorporated by reference therein, regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations
of the Commission) comply with Regulation G of the 1934 Act, and Item 10 of Regulation S-K, to the extent applicable. The interactive
data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement, the General Disclosure
Package and the Prospectus fairly presents the information called for in all material respects and has been prepared in accordance with
the Commission’s rules and guidelines applicable thereto.
(j)
Compliance with the Sarbanes-Oxley Act of 2002. There is and has been no failure on the part of the Company or any of the
Company’s directors or officers, in their capacities as such, to comply in all material respects with any applicable provision of
the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, with which the Company is required to
comply, including Section 402 related to loans.
(k)
No Material Adverse Change in Business. Except as otherwise stated therein, since the respective dates as of which information
is given in the Registration Statement, the General Disclosure Package or the Prospectus, (i) there has not been any change in the capital
stock (other than the issuance of shares of Common Stock upon exercise of stock options and warrants described as outstanding in, and
the grant of options and awards under the Company’s existing stock-based compensation plans (the “Company Stock Plans”)
described in, and the issuance of any stock upon the conversion of Company securities described in the Registration Statement, the General
Disclosure Package and the Prospectus, and the repurchase or retirement of shares of capital stock pursuant to agreements providing for
an option to repurchase or a right of first refusal on behalf of the Company pursuant to the Company’s repurchase rights), any change
in short-term debt or long-term debt of the Company, or any dividend or distribution of any kind declared, set aside for payment, paid
or made by the Company on any class of capital stock, or any material adverse change, or any development that would reasonably be expected
to result in a material adverse change, in or affecting the business, properties, management, financial position, stockholders’
equity, results of operations or prospects of the Company and its subsidiaries taken as a whole or on the performance by the Company of
its obligations under this Agreement, whether or not arising in the ordinary course of business (a “Material Adverse Effect”);
(ii) the Company has not entered into any transaction or agreement (whether or not in the ordinary course of business) that is material
to the Company or incurred any liability or obligation, direct or contingent, that is material to the Company; (iii) the Company has not
sustained any loss or interference with its business that is material to the Company and that is either from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court
or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in the Registration Statement, the General
Disclosure Package and the Prospectus; and (iv) there has been no dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.
5
(l)
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, a
“Legal Action”) which (i) adversely affects or challenges the legality, validity or enforceability of this Agreement
or the Securities and Prefunded Warrant Shares 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, to the Company’s knowledge, any director or officer
thereof, is or has been the subject of any Legal 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 1934 Act or the 1933 Act.
(m)
Good Standing of the Company. The Company has been duly organized and is validly existing and its status is active under
the laws of its jurisdiction of organization, is duly qualified to do business and is in good standing in each jurisdiction in which its
ownership or lease of property or the conduct of its business requires such qualification, and has all power and authority necessary to
own or hold its properties and to conduct the business in which it is engaged, except where the failure to be so qualified or in good
standing or have such power or authority would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. Other than as disclosed in Exhibit 21.1 of the Company’s most recent Annual Report on Form 10-K, and Duos Edge AI-GPUaaS,
LLC, a Delaware limited liability company (“AI-GPU”), formed on May 4, 2026, the Company does not have any direct or
indirect subsidiaries and does not own or control, directly or indirectly, any corporation, association or other entity.
(n)
Good Standing of the Company’s Subsidiaries. Each subsidiary of the Company (each, a “Subsidiary”
and, collectively, the “Subsidiaries”) has been duly organized and is validly existing and its status is active under
the laws of the jurisdiction of its incorporation or organization, has corporate or similar power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus
and is duly qualified to transact business and is in good standing in each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or to be in
good standing would not result in a Material Adverse Effect. Except as otherwise disclosed in the Registration Statement, the General
Disclosure Package and the Prospectus, all of the issued and outstanding capital stock of each Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and is owned by the Company, directly or through Subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity except that the Company has pledged its equity interest in AI-GPU
as security in connection with the Loan and Security Agreement, dated as of May 29, 2026 (the “LSA”), among AI-GPU,
the Company and GPU Finance Ltd., as Agent. None of the outstanding shares of capital stock of any Subsidiary was issued in violation
of the preemptive or similar rights of any securityholder of such Subsidiary. The only Subsidiaries of the Company are the entities listed
on Exhibit 21 to the Registration Statement and AI-GPU.
(o)
Capitalization. The authorized, issued and outstanding shares of capital stock of the Company are as set forth in the Registration
Statement, the General Disclosure Package and the Prospectus in the column entitled “Actual” under the caption “Capitalization”
(except for subsequent issuances, if any, (A) pursuant to this Agreement, (B) pursuant to reservations, agreements or employee benefit
plans referred to in the Registration Statement, the General Disclosure Package and the Prospectus or (C) pursuant to the conversion of
convertible securities or exercise of options or warrants referred to in the Registration Statement, the General Disclosure Package and
the Prospectus). The outstanding shares of capital stock of the Company have been duly authorized and are validly issued, fully paid and
non-assessable. None of the outstanding shares of capital stock of the Company was issued in violation of the preemptive or other similar
rights of any securityholder of the Company.
6
(p)
Stock Options. Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect, with respect to the stock options (the “Stock Options”) granted pursuant to the Company
Stock Plans, (i) each Stock Option intended to qualify as an “incentive stock option” under Section 422 of the Internal Revenue
Code of 1986, as amended, and the regulations and published interpretations thereunder (the “Code”), so qualifies,
(ii) each grant of a Stock Option was duly authorized no later than the date on which the grant of such Stock Option was by its terms
to be effective (the “Grant Date”) by all necessary corporate action, including, as applicable, approval by the board
of directors of the Company (or a duly constituted and authorized committee thereof) and any required stockholder approval by the necessary
number of votes or written consents, and, to the knowledge of the Company (other than with respect to the execution and delivery by the
Company) the award agreement governing such grant (if any) was duly executed and delivered by each party thereto, (iii) each such grant
was made, in all material respects, in accordance with the terms of the Company Stock Plans, the 1934 Act and all other applicable laws
and regulatory rules or requirements, including the rules of Nasdaq Capital Market and any other exchange on which Company securities
are traded, and (iv) each such grant was properly accounted for in accordance with GAAP in the financial statements (including the related
notes) of the Company. Each Company Stock Plan is accurately described in all material respects in the Registration Statement, the General
Disclosure Package and the Prospectus. The Company has not knowingly granted, and there is no and has been no policy or practice of the
Company of granting, Stock Options prior to, or otherwise coordinating the grant of Stock Options with, the release or other public announcement
of material information regarding the Company or its results of operations or prospects.
(q)
Authorization of Agreement; Authorization of Warrants. This Agreement has been duly authorized, executed and delivered by
the Company. The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement
and the Pre-Funded Warrants will not contravene any provision of (i) applicable law, (ii) the certificate of incorporation or by-laws
of the Company, (iii) any agreement or other instrument binding upon the Company or any of its Subsidiaries that is material to the Company
and its Subsidiaries, taken as a whole, or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction
over the Company or any Subsidiary, except that, in the case of clause (i) and (iii) as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on the Company or on the power and ability of the Company to perform its obligations under
this Agreement or the Pre-Funded Warrants and no consent, approval, authorization or order of, or qualification with, any governmental
body, agency or court is required for the performance by the Company of its obligations under this Agreement or the Pre-Funded Warrants,
except such as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Securities
and Prefunded Warrant Shares or as provided in Section 1(y).
(r)
Authorization and Description of Securities. The Securities to be purchased by the Underwriters from the Company have been
duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, when issued and delivered by the Company pursuant
to this Agreement against payment of the consideration set forth herein, will be validly issued and fully paid and non-assessable; and
the issuance of the Securities is not subject to the preemptive or other similar rights of any securityholder of the Company. The Common
Stock conforms to all statements relating thereto contained in this Agreement, the Registration Statement, the General Disclosure Package
and the Prospectus and such description conforms to the rights set forth in the instruments defining the same. No holder of Securities
will be subject to personal liability by reason of being such a holder. The Pre-Funded Warrants have been duly authorized and, when executed
and delivered by the Company in accordance with this Agreement, will be valid and legally binding agreements of the Company, enforceable
against the Company in accordance with their terms except as the enforcement thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable
principles. The maximum number of Warrant Shares to be issued by the Company upon exercise of the Pre-Funded Warrants in accordance therewith
have been duly authorized and have been or will be reserved for issuance upon exercise of the Pre-Funded Warrants in a number sufficient
to meet the current exercise requirements. The Warrant Shares, when issued and delivered upon exercise of the Pre-Funded Warrants in accordance
therewith, will be validly issued, fully paid and non-assessable, and the issuance of the Warrant Shares is not subject to any preemptive
or similar rights not otherwise validly waived or satisfied.
7
(s)
Registration Rights. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus,
to the extent that any person has the right to require the Company to register any securities for sale under the 1933 Act by reason of
the filing of the Registration Statement with the Commission or the issuance and sale of the Securities and Prefunded Warrant Shares,
those rights have been waived as of the date of this Agreement with respect to such filing or issuance and sale of Securities pursuant
to this Agreement.
(t)
Absence of Violations, Defaults and Conflicts. Neither the Company nor any Subsidiary is (A) in violation of its charter,
by-laws or similar organizational document, (B) in default in the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument
to which the Company or any Subsidiary is a party or by which either of them may be bound or to which any of the properties or assets
of the Company or any Subsidiary is subject (collectively, “Agreements and Instruments”), except for such defaults
that would not, individually or in the aggregate, result in a Material Adverse Effect, or (C) in violation of any law, statute, rule,
regulation, judgment, order, writ or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other
authority, body or agency having jurisdiction over the Company or its Subsidiaries or any of their respective properties, assets or operations
(each, a “Governmental Entity”), except for such violations that would not, individually or in the aggregate, result
in a Material Adverse Effect. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated
herein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities
and Prefunded Warrant Shares and the use of the proceeds from the sale of the Securities and Prefunded Warrant Shares as described therein
under the caption “Use of Proceeds”) and compliance by the Company with its obligations hereunder have been duly authorized
by all necessary corporate action and do not and will not, whether with or without the giving of notice or passage of time or both, conflict
with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any properties or assets of the Company or its Subsidiaries pursuant to, the Agreements and Instruments
(except for such conflicts, breaches, defaults or Repayment Events or liens, charges or encumbrances that would not, individually or in
the aggregate, result in a Material Adverse Effect), nor will such action result in any violation of the provisions of the charter, by-laws
or similar organizational document of the Company or its Subsidiaries or any law, statute, rule, regulation, judgment, order, writ or
decree of any Governmental Entity. As used herein, a “Repayment Event” means any event or condition which gives the
holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require
the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or its Subsidiaries.
(u)
Listing. The Securities and Prefunded Warrant Shares have been approved for listing on the Nasdaq Capital Market, subject
to notice of issuance.
(v)
Absence of Labor Dispute. No labor dispute with the employees of the Company or its Subsidiaries exists or, to the knowledge
of the Company, is imminent, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of its
or its Subsidiaries’ principal suppliers, manufacturers, customers or contractors, which, in either case, would result in a Material
Adverse Effect.
(w)
Absence of Proceedings. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus,
there is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity (including, without limitation,
the Department of Energy, Department of Homeland Security, the Transportation Security Administration or the Federal Railroad Administration),
or any comparable regulatory authority in any jurisdiction now pending or, to the knowledge of the Company, threatened, against or affecting
the Company or its Subsidiaries, which would reasonably be expected to result in a Material Adverse Effect, or which would reasonably
be expected to materially and adversely affect their respective properties or assets or the consummation of the transactions contemplated
in this Agreement or the performance by the Company of its obligations hereunder; and the aggregate of all pending legal or governmental
proceedings to which the Company or any such Subsidiary is a party or of which any of their respective properties or assets is the subject
which are not described in the Registration Statement, the General Disclosure Package and the Prospectus, including ordinary routine litigation
incidental to the business, would not reasonably be expected to result in a Material Adverse Effect.
(x)
Accuracy of Exhibits. There are no contracts or documents which are required to be described in the Registration Statement,
the General Disclosure Package or the Prospectus or to be filed as exhibits to the Registration Statement which have not been so described
and filed as required.
8
(y)
No Consents Required. No filing with, or authorization, approval, consent, license, order, registration, qualification or
decree of, any Governmental Entity is necessary or required for the performance by the Company of its obligations hereunder, in connection
with the offering, issuance or sale of the Securities and Prefunded Warrant Shares hereunder or the consummation of the transactions contemplated
by this Agreement, except such as have been already obtained or as may be required under the 1933 Act, the 1933 Act Regulations, the rules
of the Nasdaq Stock Market LLC, state securities laws or the rules of the Financial Industry Regulatory Authority, Inc. (“FINRA”).
(z)
Possession of Licenses and Permits. The Company and its Subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate Governmental Entities necessary
to conduct the business now operated by them (including, without limitation, all such permits, licenses, approvals, consents and other
authorizations required by local, State and Federal Governmental Entities to build and operate data centers and otherwise as may be required
by the Department of Energy, Department of Homeland Security, the Transportation Security Administration or the Federal Railroad Administration
for the operation of the business now operated by the Company and its Subsidiaries), except where the failure so to possess would not,
individually or in the aggregate, result in a Material Adverse Effect. The Company and its Subsidiaries are in compliance with the terms
and conditions of all Governmental Licenses, except where the failure so to comply would not, individually or in the aggregate, result
in a Material Adverse Effect. The Company has fulfilled and performed all of its material obligations with respect to the Governmental
Licenses and, to the knowledge of the Company, no event has occurred which allows, or after notice or lapse of time would allow, revocation
or termination thereof or results in any other material impairment of the rights of the Company as a holder of any permit, except where
the failure to so fulfill or perform, or the occurrence of such event, would not, individually or in the aggregate, result in a Material
Adverse Effect. All of the Governmental Licenses are valid and in full force and effect, except where the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and effect would not, individually or in the aggregate, result
in a Material Adverse Effect. Neither the Company nor its Subsidiaries has received any notice of proceedings relating to the revocation
or modification of any Governmental Licenses which, individually or in the aggregate, if the subject of an unfavorable decision, ruling
or finding, would result in a Material Adverse Effect.
(aa)
Title to Property. The Company and its Subsidiaries have good and marketable title to all real property owned by them and
good title to all other properties owned by them, in each case, free and clear of all mortgages, pledges, liens, security interests, claims,
restrictions or encumbrances of any kind except such as (A) are described in the Registration Statement, the General Disclosure Package
and the Prospectus or (B) do not, individually or in the aggregate, 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 or its Subsidiaries; and all of the leases and subleases
material to the business of the Company and its Subsidiaries, considered as one enterprise, and under which the Company or its Subsidiaries
holds properties described in the Registration Statement, the General Disclosure Package or the Prospectus, are in full force and effect,
and neither the Company nor any such Subsidiary has any notice of any material claim of any sort that has been asserted by anyone adverse
to the rights of the Company or any Subsidiary under any of the leases or subleases mentioned above, or affecting or questioning the rights
of the Company or such Subsidiary to the continued possession of the leased or subleased premises under any such lease or sublease.
9
(bb)
Title to Intellectual Property. The Company owns or has valid, binding and enforceable licenses or other rights under the
patents, patent applications, licenses, inventions, copyrights, know how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property
necessary for, or used in the conduct, or the proposed conduct, of the business of the Company in the manner described in the Registration
Statement, the General Disclosure Package and the Prospectus (collectively, the “Intellectual Property”); the patents,
trademarks, and copyrights, if any, included within the Intellectual Property are valid, enforceable, and subsisting; other than as disclosed
in the Registration Statement, the General Disclosure Package and the Prospectus, (A) the Company is not obligated to pay a material royalty,
grant a license to, or provide other material consideration to any third party in connection with the Intellectual Property, (B) the Company
has not received any notice of any claim of infringement, misappropriation or conflict with any asserted rights of others with respect
to any of the Company’s services, processes or Intellectual Property, (C) to the knowledge of the Company, neither the sale nor
use of any of the discoveries, inventions, services or processes of the Company referred to in the Registration Statement, the General
Disclosure Package or the Prospectus do or will, to the knowledge of the Company, infringe, misappropriate or violate any right or valid
patent claim of any third party, (D) none of the technology employed by the Company has been obtained or is being used by the Company
in material violation of any contractual obligation binding on the Company or, to the Company’s knowledge, upon any of its officers,
directors or employees or otherwise in violation of the rights of any persons, (E) to the knowledge of the Company, no third party has
any ownership right in or to any Intellectual Property that is owned by the Company, other than any co-owner of any patent constituting
Intellectual Property who is listed on the records of the U.S. Patent and Trademark Office (the “USPTO”) and any co-owner
of any patent application constituting Intellectual Property who is named in such patent application until the Company obtains and records
assignments from any such co-owner named in an application or patent, assigning to the Company all ownership rights, and, to the knowledge
of the Company, no other third party has any ownership right in or to any Intellectual Property in any field of use that is exclusively
licensed to the Company, other than any licensor to the Company of such Intellectual Property, (F) there is no material infringement by
third parties of any Intellectual Property, (G) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding
or claim by others challenging the Company’s rights in or to any Intellectual Property, and (H) there is no pending or, to the Company’s
knowledge, threatened action, suit, proceeding or claim by others challenging the validity or scope of any Intellectual Property. The
Company is in compliance in all material respects with the terms of each agreement pursuant to which Intellectual Property has been licensed
to the Company, and all such agreements are in full force and effect. For the avoidance of doubt, the Company owns all Intellectual Property
necessary for, or used in the conduct, or the proposed conduct, of the Company’s Duos Edge AI Inc. and Duos Energy Corporation business.
(cc)
Patents and Patent Applications. All patents and patent applications owned by or licensed to the Company or under which
the Company has rights have, to the knowledge of the Company, been duly and properly filed and maintained, including timely payment of
all maintenance and renewal fees; to the knowledge of the Company, the parties prosecuting such patent applications have complied with
their duty of candor and disclosure to the USPTO in connection with such applications; and the Company is not aware of any facts required
to be disclosed to the USPTO that were not disclosed to the USPTO and which would preclude the grant of a patent in connection with any
such application or would reasonably be expected to form the basis of a finding of invalidity with respect to any patents that have issued
with respect to such applications. To the Company’s knowledge, all patents and patent applications owned by the Company and filed
with the USPTO or any foreign or international patent authority (the “Company Patent Rights”) and all patents and patent
applications in-licensed by the Company and filed with the USPTO or any foreign or international patent authority (the “In-licensed
Patent Rights”) have been duly and properly filed; the Company believes it has complied with its duty of candor and disclosure
to the USPTO for the Company Patent Rights and, to the Company’s knowledge, the licensors of the In-licensed Patent Rights have
complied with their duty of candor and disclosure to the USPTO for the In-licensed Patent Rights.
(dd)
Forward-Looking Statements. No forward-looking statement (within the meaning of Section 27A of the 1933 Act and Section
21E of the 1934 Act) included or incorporated by reference in any of the Registration Statement, the General Disclosure Package or the
Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(ee)
No Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries,
on the one hand, and the directors, officers, stockholders, customers, suppliers or other affiliates of the Company or any of its subsidiaries,
on the other, that is required by the 1933 Act to be described in each of the Registration Statement, the General Disclosure Package and
the Prospectus and that is not so described in such documents.
(ff)
Margin Rules. Neither the issuance, sale and delivery of the Securities nor the application of the proceeds thereof by the
Company as described in each of the Registration Statement, the General Disclosure Package and the Prospectus will violate Regulation
T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
10
(gg)
Environmental Laws. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus
or would not, individually or in the aggregate, result in a Material Adverse Effect, (A) neither the Company nor any Subsidiary is in
violation of any federal, state, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common law or any
judicial or administrative interpretation thereof, including any judicial or administrative order, consent, decree or judgment, relating
to pollution or protection of human health, the environment (including, without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened release
of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum or petroleum products, asbestos-containing
materials or mold (collectively, “Hazardous Materials”) or to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Hazardous Materials (collectively, “Environmental Laws”), (B) the Company
and its Subsidiaries have all permits, authorizations and approvals required under any applicable Environmental Laws and are each in compliance
with their requirements, (C) there are no pending or, to the knowledge of the Company threatened, administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigation or proceedings relating to
any Environmental Law against the Company or any Subsidiary and (D) to the Company’s knowledge, there are no events or circumstances
that would reasonably be expected to form the basis of an order for clean-up or remediation, or an action, suit or proceeding by any private
party or Governmental Entity, against or affecting the Company or any Subsidiary relating to Hazardous Materials or any Environmental
Laws.
(hh)
Accounting Controls and Disclosure Controls. The Company and each of its Subsidiaries maintain effective internal control
over financial reporting (as defined under Rule 13-a15 and 15d-15 under the rules and regulations of the Commission under the 1934 Act
Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed
in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary to permit preparation
of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to assets is permitted only in accordance
with management’s general or specific authorization; (D) the recorded accountability for assets is compared with the existing assets
at reasonable intervals and appropriate action is taken with respect to any differences; and (E) the interactive data in eXtensible Business
Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus fairly presents
the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable
thereto. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, since the end of the Company’s
most recent audited fiscal year, there has been (1) no material weakness in the Company’s internal control over financial reporting
(whether or not remediated) and (2) no change in the Company’s internal control over financial reporting that has materially adversely
affected, or is reasonably likely to materially adversely affect, the Company’s internal control over financial reporting. The Company
and each of its Subsidiaries maintain an effective system of disclosure controls and procedures (as defined in Rule 13a-15 and Rule 15d-15
under the 1934 Act Regulations) that are designed to ensure that information required to be disclosed by the Company in the reports that
it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s
rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers
and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure.
(ii)
Payment of Taxes. All material United States federal income tax returns of the Company and its Subsidiaries required by
law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid,
except assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been provided in conformity
with GAAP. The United States federal income tax returns of the Company through the fiscal year ended December 31, 2023 have been settled
and no assessment in connection therewith has been made against the Company. The Company and its Subsidiaries have filed all other tax
returns that are required to have been filed by them pursuant to applicable foreign, state, local or other law except insofar as the failure
to file such returns would not result in a Material Adverse Effect, and have paid all taxes due pursuant to such returns or pursuant to
any assessment received by the Company and its Subsidiaries, except for such taxes, if any, as are being contested in good faith and as
to which adequate reserves have been established by the Company. The charges, accruals and reserves on the books of the Company in respect
of any income and corporation tax liability for any years not finally determined are, in conformity with GAAP, adequate to meet any assessments
or re-assessments for additional income tax for any years not finally determined, except to the extent of any inadequacy that would not
result in a Material Adverse Effect.
(jj)
Insurance. The Company and its Subsidiaries carry or are entitled to the benefits of insurance, with financially sound and
reputable insurers, in such amounts and covering such risks as is generally maintained by companies of established repute engaged in the
same or similar business, and all such insurance is in full force and effect. The Company has no reason to believe that it or its Subsidiaries
will not be able (A) to renew its existing insurance coverage as and when such policies expire or (B) to obtain comparable coverage from
similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in
a Material Adverse Effect. Neither of the Company nor its Subsidiaries has been denied any insurance coverage which it has sought or for
which it has applied.
11
(kk)
Investment Company Act. The Company is not required, and upon the issuance and sale of the Securities as herein contemplated
and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package and the Prospectus
will not be required, to register as an “investment company” under the Investment Company Act of 1940, as amended (the “1940
Act”).
(ll)
Absence of Manipulation. Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate
take, directly or indirectly, any action which is designed, or would be expected, to cause or result in, or which constitutes, the stabilization
or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities and Prefunded Warrant Shares
or to result in a violation of Regulation M under the 1934 Act.
(mm)
No Unlawful Payments; Foreign Corrupt Practices Act. Neither the Company nor any of its Subsidiaries nor, to the knowledge
of the Company, any director, officer, employee, agent, affiliate or other person acting on behalf of the Company or any Subsidiary, has
(i) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity,
(ii) made any direct or indirect unlawful payment to foreign or domestic government officials or employees, political parties or campaigns,
political party officials, or candidates for political office from corporate funds, (iii) violated or is in violation of any provision
of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any applicable anti-corruption laws, rules, or regulation of any other
jurisdiction in which the Company or any Subsidiary conducts business, or (iv) made any other unlawful bribe, rebate, payoff, influence
payment, kickback, or other unlawful payment to any person.
(nn)
Money Laundering Laws. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance
with all applicable financial recordkeeping and reporting requirements, including those of the U.S. Bank Secrecy Act, as amended by Title
III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA
PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and its Subsidiaries conduct business,
the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by
any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to
the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(oo)
OFAC. None of the Company, its Subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee,
affiliate or representative of the Company or its Subsidiaries is an individual or entity (“Person”) currently the
subject or target of any sanctions administered or enforced by the United States Government, including, without limitation, the U.S. Department
of the Treasury’s Office of Foreign Assets Control, the United Nations Security Council, the European Union, His Majesty’s
Treasury, or other relevant sanctions authority (collectively, “Sanctions”), nor is the Company located, organized
or resident in a country or territory that is the subject of Sanctions; and the Company will not directly or indirectly use the proceeds
of the sale of the Securities, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partners
or other Person, to fund any activities of or business with any Person, or in any country or territory, that, at the time of such funding,
is the subject of Sanctions or in any other manner that will result in a violation by any Person (including any Person participating in
the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions.
(pp)
Outbound Investment Security Program. Neither the Company nor any of its Subsidiaries is a “covered foreign person”,
as that term is defined in 31 C.F.R. § 850.209. Neither the Company nor any of its subsidiaries currently engages, or has plans to
engage, directly or indirectly, in a “covered activity”, as that term is defined in 31 C.F.R. § 850.208 (“Covered
Activity”). The Company does not have any joint ventures that engages in or plans to engage in any Covered Activity. The Company
also does not, directly or indirectly, hold a board seat on, have a voting or equity interest in, or have any contractual power to direct
or cause the direction of the management or policies of any person or persons that engages or plans to engage in any Covered Activity.
12
(qq)
Statistical and Market-Related Data. Any statistical and market-related data included in the Registration Statement, the
General Disclosure Package or the Prospectus are based on or derived from sources that the Company believes, after reasonable inquiry,
to be reliable and accurate and, to the extent required, the Company has obtained the written consent to the use of such data from such
sources.
(rr)
Privacy and Data Protection. The Company and its Subsidiaries have operated their business in a manner compliant in all
material respects with all United States federal, state, local and non-United States privacy, data security and data protection laws and
regulations applicable to the Company’s collection, use, transfer, protection, disposal, disclosure, handling, storage and analysis
of personal data. The Company and its Subsidiaries have been and are in compliance in all material respects with internal policies and
procedures designed to ensure the integrity and security of the data collected, handled or stored in connection with its business; the
Company and its Subsidiaries have been and are in compliance in all material respects with internal policies and procedures designed to
ensure compliance with the Health Care Laws that govern privacy and data security and take, and have taken reasonably appropriate steps
designed to assure compliance with such policies and procedures. The Company and its Subsidiaries have taken reasonable steps to maintain
the confidentiality of its personally identifiable information, protected health information, consumer information and other confidential
information of the Company, its Subsidiaries and any third parties in its possession (“Sensitive Company Data”). The
tangible or digital information technology systems (including computers, screens, servers, workstations, routers, hubs, switches, networks,
data communications lines, technical data and hardware), software and telecommunications systems used or held for use by the Company and
its Subsidiaries (the “Company IT Assets”) are adequate and operational for, in accordance with their documentation
and functional specifications, the business of the Company and its Subsidiaries as now operated and as currently proposed to be conducted
as described in the Registration Statement, the General Disclosure Package and the Prospectus. The Company and its Subsidiaries have used
reasonable efforts to establish, and have established, commercially reasonable disaster recovery and security plans, procedures and facilities
for the business consistent with industry standards and practices in all material respects, including, without limitation, for the Company
IT Assets and data held or used by or for the Company and its Subsidiaries. The Company and its Subsidiaries have not suffered or incurred
any security breaches, compromises or incidents with respect to any Company IT Asset or Sensitive Company Data, except where such breaches,
compromises or incidents would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect; and
there has been no unauthorized or illegal use of or access to any Company IT Asset or Sensitive Company Data by any unauthorized third
party. The Company and its Subsidiaries have not been required to notify any individual of any information security breach, compromise
or incident involving Sensitive Company Data.
(ss)
No Broker Fees. Except pursuant to this Agreement and as disclosed in the General Disclosure Package, there are no contracts,
agreements or understandings between the Company and any person that would give rise to a valid claim against the Company or any Underwriter
for a brokerage commission, finder’s fee or other like payment in connection with the offering of the Securities contemplated hereby.
(tt)
Transactions With Affiliates and Employees. Except as set forth in the General Disclosure Package, none of the officers
or directors of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary
is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real
or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or
from, any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000
other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the
Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.
(uu)
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 this Agreement, and any other documents or agreements executed in connection with the
transactions contemplated hereunder.
13
(vv)
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 or exchange on which any of the securities of the Company are listed or designated.
(ww)
Solvency. Based on the consolidated financial condition of the Company as of the Closing Time, 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 Time
(xx)
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.
(yy)
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 Code, and the Company shall so certify upon the Representative’s request.
(zz)
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.
(aaa)
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 of the Securities and in the Lock-up Agreements (as defined
below) provided to the Underwriters is true and correct in all respects and the Company has not become aware of any information which
would cause the information disclosed in such questionnaires to become inaccurate and incorrect.
14
(bbb)
FINRA Affiliation. No officer, director or 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 of the Securities. The Company will advise the Representative and Underwriters’
counsel if it learns that any officer, director or owner of 10% or more of (i) the Company’s outstanding shares of Common Stock
or (ii) 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 is or becomes an affiliate or associated
person of a FINRA member firm.
(ccc)
Board of Directors. Except as set forth in the SEC Reports, the Board of Directors is comprised of the persons set forth
in the Company’s Definitive Proxy Statement on Schedule 14A filed with the Commission on April 15, 2026 and the Supplement to Proxy
Statement filed with the Commission on May 20, 2026. 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 Nasdaq Stock Market LLC. 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 Nasdaq Stock Market
LLC. 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 Nasdaq Stock Market LLC.
(ddd)
Cybersecurity. (i)(x) There has been no material 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 material 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.
(eee)
ERISA Compliance. The Company and its Subsidiaries and any “employee benefit plan” (as defined under the Employee
Retirement Income Security Act of 1974, as amended, and the regulations and published interpretations thereunder (collectively, “ERISA”))
established or maintained by the Company, its Subsidiaries or their “ERISA Affiliates” (as defined below) are in compliance
in all material respects with ERISA. “ERISA Affiliate” means, with respect to the Company or any of its Subsidiaries, any
member of any group of organizations described in Sections 414(b), (c), (m) or (o) of the Code of which the Company or such Subsidiary
is a member. No “reportable event” (as defined under ERISA) has occurred or is reasonably expected to occur with respect to
any “employee benefit plan” established or maintained by the Company, its Subsidiaries or any of their ERISA Affiliates. No
“employee benefit plan” established or maintained by the Company, its Subsidiaries or any of their ERISA Affiliates, if such
“employee benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as defined under
ERISA). Neither the Company, its Subsidiaries nor any of their ERISA Affiliates has incurred or reasonably expects to incur any liability
under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections
412, 4971, 4975 or 4980B of the Code. Each employee benefit plan established or maintained by the Company, its Subsidiaries or any of
their ERISA Affiliates that is intended to be qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether
by action or failure to act, which would cause the loss of such qualification.
(fff)
No Rights to Purchase Preferred Stock. The issuance and sale of the Securities as contemplated hereby will not cause any
holder of any shares of capital stock, securities convertible into or exchangeable or exercisable for capital stock or options, warrants
or other rights to purchase capital stock or any other securities of the Company to have any right to acquire any shares of preferred
stock of the Company.
(ggg)
No Contract Terminations. Neither the Company nor any of its Subsidiaries has sent or received any communication regarding
termination of, or intent not to renew, any of the contracts or agreements referred to or described in the Registration Statement, the
General Disclosure Package or the Prospectus, and no such termination or non-renewal has been threatened by the Company or any of its
Subsidiaries or, to the Company’s knowledge, any other party to any such contract or agreement, which threat of termination or non-renewal
has not been rescinded as of the date hereof.
15
(hhh)
Dividend Restrictions. No Subsidiary of the Company is prohibited or restricted, directly or indirectly, from paying dividends
to the Company, or from making any other distribution with respect to such Subsidiary’s equity securities or from repaying to the
Company or any other Subsidiary of the Company any amounts that may from time to time become due under any loans or advances to such Subsidiary
from the Company or from transferring any property or assets to the Company or to any other Subsidiary, except for AI-GPU pursuant to
the terms of the LSA.
(iii)
Maintenance of Rating. Neither the Company nor its Subsidiaries have any debt securities or preferred stock that are rated
by any “nationally recognized statistical rating agency” (as defined in Section 3(a)(62) of the 1934 Act).
(jjj)
No Acquisitions or Dispositions. Except as are described in the Registration Statement, the General Disclosure Package and
the Prospectus, there are no contracts, letters of intent, term sheets, agreements, arrangements or understandings with respect to the
direct or indirect acquisition or disposition by the Company of material interests in real or personal property.
Any certificate signed by any
officer of the Company or any of its Subsidiaries and delivered to any Underwriter or to counsel for the Underwriters in connection with
the offering, or the purchase and sale, of the Securities shall be deemed a representation and warranty by the Company to each Underwriter
as to the matters covered thereby.
The Company has a reasonable
basis for making each of the representations set forth in this Section 1. The Company acknowledges that the Underwriters and, for purposes
of the opinions to be delivered pursuant to Section 5 hereof, counsel to the Company and counsel to the Underwriters, will rely upon the
accuracy and truthfulness of the foregoing representations and hereby consents to such reliance.
SECTION 2.
Sale and Delivery to Underwriters; Closing.
(a)
Closing Securities. On the basis of the representations and warranties herein contained and subject to the terms and conditions
herein set forth, the Company agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly,
agrees to purchase from the Company, at the price per share of Common Stock or per Pre-Funded Warrant, as applicable, set forth in Schedule
B-1, that number of Closing Shares and Pre-Funded Warrants set forth in Schedule A opposite the name of such Underwriter, plus
any additional number of Closing Shares which such Underwriter may become obligated to purchase pursuant to the provisions of Section
10 hereof, subject, in each case, to such adjustments among the Underwriters as the Representative in its sole discretion shall make to
eliminate any sales or purchases of fractional shares.
(b)
[Intentionally omitted].
(c)
Payment. Payment of the purchase price for, and delivery of certificates or security entitlements for, the Closing Shares
and Pre-Funded Warrants shall be made at the offices of Underwriter’s Counsel, or at such other place as shall be agreed upon by
the Representative and the Company, at 10:00 A.M. (New York City time) on the first (second, if the pricing occurs after 4:00 P.M. (New
York City time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of Section 10),
or such other time not later than ten business days after such date as shall be agreed upon by the Representative and the Company (such
time and date of payment and delivery being herein called “Closing Time”). Delivery of the Closing Shares at the Closing
Time shall be made through the facilities of The Depository Trust Company unless the Representative shall otherwise instruct. The Pre-Funded
Warrants shall be delivered to the Representative in definitive form, registered in such names and in such denominations as the Representative
shall request in writing not later than the Closing Time. The Pre-Funded Warrants will be made available for inspection by the Representative
on the business day prior to the Closing Time.
16
Payment shall be made to the
Company by wire transfer of immediately available funds to a bank account designated by the Company, against delivery to the Representative
for the respective accounts of the Underwriters of certificates or security entitlements for the Securities to be purchased by them. It
is understood that each Underwriter has authorized the Representative, for its account, to accept delivery of, receipt for, and make payment
of the purchase price for, the Closing Shares and the Pre-Funded Warrants which it has agreed to purchase. TD Cowen, individually and
not as representative of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Closing Shares
and the Pre-Funded Warrants to be purchased by any Underwriter whose funds have not been received by the Closing Time, but such payment
shall not relieve such Underwriter from its obligations hereunder.
The Company acknowledges and
agrees that the Underwriters may offer and sell Securities to or through any affiliate of an Underwriter.
SECTION 3.
Covenants of the Company. The Company covenants with each Underwriter as follows:
(a)
Compliance with Securities Regulations and Commission Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430B, and will notify the Representative as soon as practicable, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become effective or any amendment or supplement to the Prospectus shall have
been filed, (ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus (including any document incorporated by reference therein) or for additional
information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any
post-effective amendment or of any order preventing or suspending the use of any preliminary prospectus or the Prospectus, or of the suspension
of the qualification of the Securities and Prefunded Warrant Shares for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(d) or 8(e) of the 1933 Act concerning
the Registration Statement and (v) if the Company becomes the subject of a proceeding under Section 8A of the 1933 Act in connection with
the offering of the Securities. The Company will effect all filings required under Rule 424(b), in the manner and within the time period
required by Rule 424(b) (without reliance on Rule 424(b)(8)), and will take such steps as it deems necessary to ascertain promptly whether
the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was
not, it will promptly file such prospectus. The Company will make every reasonable effort to prevent the issuance of any stop order, prevention
or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.
(b)
Continued Compliance with Securities Laws. The Company will comply with the 1933 Act, the 1933 Act Regulations, the 1934
Act and the 1934 Act Regulations so as to permit the completion of the distribution of the Securities as contemplated in this Agreement
and in the Registration Statement, the General Disclosure Package and the Prospectus. If at any time when a prospectus relating to the
Securities is (or, but for the exception afforded by Rule 172 of the 1933 Act Regulations (“Rule 172”), would be) required
by the 1933 Act to be delivered in connection with sales of the Securities or any event shall occur or condition shall exist as a result
of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to (i) amend the Registration Statement in
order that the Registration Statement will not include an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading, (ii) amend or supplement the General Disclosure Package
or the Prospectus in order that the General Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement
of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the
General Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company will promptly (A) give the Representative notice of such event, (B) prepare any amendment or supplement as
may be necessary to correct such statement or omission or to make the Registration Statement, the General Disclosure Package or the Prospectus
comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish the Representative with copies
of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; provided that the Company shall
not file or use any such amendment or supplement to which the Representative or counsel for the Underwriters shall reasonably object.
The Company will furnish to the Underwriters such number of copies of such amendment or supplement as the Underwriters may reasonably
request. The Company has given the Representative notice of any filings made pursuant to the 1934 Act or the 1934 Act Regulations within
48 hours prior to the Applicable Time; the Company will give the Representative notice of its intention to make any such filing from the
Applicable Time to the Closing Time and will furnish the Representative with copies of any such documents a reasonable amount of time
prior to such proposed filing, as the case may be, and will not file or use any such document to which the Representative or counsel for
the Underwriters shall reasonably object.
17
(c)
Delivery of Registration Statements. The Company has furnished or will deliver to the Representative and counsel for the
Underwriters, without charge, signed copies of the Registration Statement as originally filed and each amendment thereto (including exhibits
filed therewith or incorporated by reference therein and documents incorporated or deemed incorporated by reference therein) and signed
copies of all consents and certificates of experts, and will also deliver to the Representative, without charge, a conformed copy of the
Registration Statement as originally filed and each amendment thereto (without exhibits) for each of the Underwriters. The copies of the
Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(d)
Delivery of Prospectuses. The Company has delivered to each Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted
by the 1933 Act. The Company will furnish to each Underwriter, without charge, during the period when a prospectus relating to the Securities
and Prefunded Warrant Shares is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act,
such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed
with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(e)
Blue Sky Qualifications. The Company will use its best efforts, in cooperation with the Underwriters, to qualify the Securities
for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representative
may designate and to maintain such qualifications in effect so long as required to complete the distribution of the Securities; provided,
however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation
or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject.
(f)
Rule 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earning statement for the purposes of, and to provide to the Underwriters the
benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.
(g)
Use of Proceeds. The Company will use the net proceeds received by it from the sale of the Securities in all material respects
in the manner specified in the Registration Statement, the General Disclosure Package and the Prospectus under the heading “Use
of Proceeds.”
(h)
Listing. The Company will use its best efforts to effect and maintain the listing of the Common Stock (including the Closing
Shares and the Prefunded Warrant Shares) on the Nasdaq Stock Market LLC.
18
(i)
Restriction on Sale of Securities.
(i)
From the date hereof until 90 days following the Closing Time, the Company will not, without the prior written consent of the Representative,
(i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file or confidentially submit any registration statement under the
1933 Act with respect to any of the foregoing, (ii) enter into any swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether any such swap or transaction described
in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (iii) publicly
announce an intention to effect any such swap, agreement or other transaction described in clauses (i) and (ii). The foregoing sentence
shall not apply to (A) the Securities to be issued and sold hereunder; (B) any shares of Common Stock issued by the Company upon the exercise
of an option or warrant, including the Pre-Funded Warrants, or the conversion of a convertible security outstanding on the date hereof
and referred to in the Registration Statement, the General Disclosure Package and the Prospectus; (C) any shares of Common Stock issued
or options to purchase Common Stock granted pursuant to existing employee benefit plans of the Company referred to in the Registration
Statement, the General Disclosure Package and the Prospectus; (D) any shares of Common Stock issued pursuant to any existing non-employee
director stock plan or dividend reinvestment plan referred to in the Registration Statement, the General Disclosure Package and the Prospectus;
or (E) the filing by the Company of any registration statement on Form S-8 or a successor form thereto.
(ii)
From the date hereof until 90 days following the Closing Time, without the prior consent of the Representative, the Company shall
be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of Common
Stock or Common Stock Equivalents (or a combination of units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction”
means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or
exercisable for, or include the right to receive, additional shares of Common Stock either (A) at a conversion price, exercise price or
exchange rate or other price that is based upon, and/or varies with, the trading prices of or quotations for the shares of Common Stock
at any time after the initial issuance of such debt or equity securities or (B) with a conversion, exercise or exchange price that is
subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified
or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock or (ii) enters into,
or effects a transaction under, any agreement, including, but not limited to, an equity line of credit, whereby the Company may issue
securities at a future determined price regardless of whether shares pursuant to such agreement have actually been issued and regardless
of whether such agreement is subsequently canceled. Any Underwriter shall be entitled to obtain injunctive relief against the Company
to preclude any such issuance, which remedy shall be in addition to any right to collect damages.
(iii)
Notwithstanding the foregoing, this Section 3(i) shall not apply in respect of an Exempt Issuance, except that no Variable Rate
Transaction shall be an Exempt Issuance. “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 equity incentive 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, 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
within 90 days following the Closing Time, 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.
(j)
Reporting Requirements. The Company, during the period when a Prospectus relating to the Securities and Prefunded Warrant
Shares is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the 1933 Act, will file all documents
required to be filed with the Commission pursuant to the 1934 Act within the time periods required by the 1934 Act and 1934 Act Regulations.
(k)
Issuer Free Writing Prospectuses. The Company agrees that, unless it obtains the prior written consent of the Representative,
it will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise
constitute a “free writing prospectus,” or a portion thereof, required to be filed by the Company with the Commission or retained
by the Company under Rule 433; provided that the Representative will be deemed to have consented to the Issuer Free Writing Prospectuses
listed on Schedule B-2 hereto and any “road show that is a written communication” within the meaning of Rule 433(d)(8)(i)
that has been reviewed by the Representative. The Company represents that it has treated or agrees that it will treat each such free writing
prospectus consented to, or deemed consented to, by the Representative as an “issuer free writing prospectus,” as defined
in Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely
filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing Prospectus
there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would conflict
with the information contained in the Registration Statement, any preliminary prospectus or the Prospectus or included or would include
an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representative
and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict,
untrue statement or omission.
19
(l)
Testing-the-Waters Materials. If at any time following the distribution of any Written Testing-the-Waters Communication
there occurred or occurs an event or development as a result of which such Written Testing-the-Waters Communication included or would
include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representative
and will promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such
untrue statement or omission.
(m)
Reservation of Shares. The Company shall, at all times while any Pre-Funded Warrants are outstanding, reserve and keep available
out of the aggregate of its authorized but unissued and otherwise unreserved shares of Common Stock, solely for the purpose of enabling
it to issue Warrant Shares upon exercise of such Pre-Funded Warrants, the number of Warrant Shares that are initially issuable and deliverable
upon the exercise of the then-outstanding Pre-Funded Warrants.
SECTION 4.
Payment of Expenses.
(a)
Expenses. The Company hereby agrees to pay at the Closing Time all expenses associated with the Offering or 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 costs of reproducing and distributing
each of the Pre-Funded Warrants) with the Commission; (b) all FINRA Public Offering Filing System fees associated with the review of the
Offering by FINRA; (c) the fees and expenses incurred in connection with the listing of the Closing Shares and Prefunded Warrant Shares
on the Nasdaq Stock Market LLC and such other stock exchanges as the Company and the Representative together determine; (d) 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); (e) 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; (f) the costs and expenses of the Company’s public relations firm; (g) the costs of preparing, printing and delivering
the Securities; (h) the costs for “tombstones” and/or other commemorative items; (i) 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); (j) stock transfer and/or stamp taxes, if any, payable upon the transfer of securities from the Company to the Underwriters;
(k) the fees and expenses of the Company’s accountants; (l) the fees and expenses of the Company’s legal counsel and other
agents and representatives; (m) the Underwriters’ costs of mailing prospectuses to prospective investors; (n) the costs associated
with advertising the Offering in the national editions of the Wall Street Journal and New York Times after the Closing Time; (o) up to
$100,000 for the fees and expenses of Underwriter’s Counsel; (p) the Company’s reasonable “road show” expenses
for the Offering; and (q) the costs for bound volumes of the public offering materials as well as commemorative mementos and Lucite tombstones,
each of which the Company or its designee will provide within a reasonable time after the Closing in such quantities as the Underwriters
may reasonably request. The Underwriters may also deduct from the net proceeds of the Offering payable to the Company on the Closing Time
the expenses set forth herein to be paid by the Company to the Underwriters. For the avoidance of doubt, in no event shall reimbursable
expenses to the Underwriters exceed $125,000.
20
(b)
Termination of Agreement. If this Agreement is terminated by the Representative in accordance with the provisions of Section
5, Section 9(a)(i), Section 9(a)(iii) or Section 10 hereof, the Company shall reimburse the Underwriters for all of their reasonably documented
out-of-pocket expenses, including the reasonable and documented fees and disbursements of counsel for the Underwriters (up to an aggregate
of $125,000); provided that if this Agreement is terminated by the Representative pursuant to Section 10 hereof, the Company will have
no obligation to reimburse any defaulting Underwriter.
SECTION 5.
Conditions of Underwriters’ Obligations. The obligations of the several Underwriters hereunder are subject to the
accuracy of the representations and warranties of the Company contained herein or in certificates of any officer of the Company or any
of its Subsidiaries delivered pursuant to the provisions hereof, to the performance by the Company of its covenants and other obligations
hereunder, and to the following further conditions:
(a)
Effectiveness of Registration Statement. The Registration Statement, including any Rule 462(b) Registration Statement, has
become effective and, at the Closing Time, no stop order suspending the effectiveness of the Registration Statement or any post-effective
amendment thereto has been issued under the 1933 Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus
has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge,
contemplated; and the Company has complied with each request (if any) from the Commission for additional information to the reasonable
satisfaction of counsel to the Underwriters.
(b)
Opinion of Counsel for Company. At the Closing Time, the Representative shall have received the opinion and the negative
assurance letter, each dated the Closing Time, of Shutts & Bowen LLP, counsel for the Company, together with the opinion of the Law
Office of L. Jack Gibney, special counsel for the Company with respect to intellectual property matters, each in form and substance satisfactory
to the Representative.
(c)
Opinion of Counsel for Underwriters. At the Closing Time, the Representative shall have received an opinion, dated the Closing
Time, of Mayer Brown LLP, counsel for the Underwriters (“Underwriter’s Counsel”), together with signed or reproduced
copies of such letters for each of the other Underwriters in form and substance satisfactory to the Representative.
(d)
Officers’ Certificate. At the Closing Time, there shall not have been, since the date hereof or since the respective
dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its Subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of business, and the Representative shall have received a
certificate of the principal executive officer of the Company and of the principal financial officer of the Company, dated the Closing
Time, to the effect that (i) there has been no such material adverse change, (ii) the representations and warranties of the Company in
this Agreement are true and correct with the same force and effect as though expressly made at and as of the Closing Time, (iii) the Company
has complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to the Closing Time,
and (iv) no stop order suspending the effectiveness of the Registration Statement under the 1933 Act has been issued, no order preventing
or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have
been instituted or are pending or, to their knowledge, contemplated.
21
(e)
Accountant’s Comfort Letter. At the time of the execution of this Agreement, the Representative shall have received
from Salberg & Company, P.A. a letter, dated such date, in form and substance satisfactory to the Representative, together with signed
or reproduced copies of such letter for each of the other Underwriters containing statements and information of the type ordinarily included
in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information
contained in the Registration Statement, the General Disclosure Package and the Prospectus.
(f)
Bring-down Comfort Letter. At the Closing Time, the Representative shall have received from Salberg & Company, P.A.
a letter, dated as of the Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection
(e) of this Section, except that the specified date referred to shall be a date not more than three business days prior to the Closing
Time.
(g)
Approval of Listing. The Company shall have submitted a listing of additional shares notification form to Nasdaq Stock Market
LLC with respect to the Securities and Prefunded Warrant Shares shall have received no objection thereto from Nasdaq Stock Market LLC.
(h)
Form of Pre-Funded Warrant. The Representative shall have received a form of Pre-Funded Warrant in form and substance reasonably
acceptable to the Representative.
(i)
No Objection. FINRA shall have raised no objection to the fairness and reasonableness of the underwriting terms and arrangements.
(j)
Lock-up Agreements. At the Closing Time, the Representative shall have received an agreement substantially in the form of
Exhibit A hereto signed by all of the Company’s directors and officers and shareholders of the Company listed on Exhibit
A (the “Lock-up Agreements”). The Company agrees to enforce the restrictions on transfer set forth in Lock-up Agreements.
(k)
[Intentionally omitted]
(l)
[Intentionally omitted]
(m)
[Intentionally omitted]
(n)
Additional Documents. At the Closing Time, counsel for the Underwriters shall have been furnished with such other documents
and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Securities as herein contemplated
shall be reasonably satisfactory in form and substance to the Representative and counsel for the Underwriters.
(o)
Termination of Agreement. If any condition specified in this Section shall not have been fulfilled when and as required
to be fulfilled, this Agreement may be terminated by the Representative by notice to the Company at any time at or prior to Closing Time
and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections
1, 4, 6, 7, 8, 13, 14 and 15 shall survive any such termination and remain in full force and effect.
SECTION 6.
Indemnification.
(a)
Indemnification of Underwriters. The Company agrees to indemnify and hold harmless each Underwriter, its affiliates (as
such term is defined in Rule 501(b) under the 1933 Act (each, an “Affiliate”)), its selling agents and each person,
if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
22
(i)
against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including any information
deemed to be a part thereof pursuant to Rule 430B, or the omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement
of a material fact included (A) in any preliminary prospectus, any Issuer Free Writing Prospectus, any Written Testing-the-Waters Communication,
the General Disclosure Package or the Prospectus (or any amendment or supplement thereto), or (B) in 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 (“Marketing
Materials”), including any roadshow or investor presentations made to investors by the Company (whether in person or electronically),
or the omission or alleged omission in any preliminary prospectus, any Issuer Free Writing Prospectus, any Written Testing-the-Waters
Communication, the General Disclosure Package, the Prospectus (or any amendment or supplement thereto) or in any Marketing Materials of
a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
(ii)
against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of
any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that
(subject to Section 6(d) below) any such settlement is effected with the written consent of the Company; and
(iii)
against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Representative),
reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged
untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement
shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged
untrue statement or omission made in the Registration Statement (or any amendment thereto), including any information deemed to be a part
thereof pursuant to Rule 430B, the General Disclosure Package or the Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with the Underwriter Information.
(b)
Indemnification of Company, Directors and Officers. Each Underwriter severally agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any and all loss, liability, claim, damage, and
expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements
or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including any
information deemed to be a part thereof pursuant to Rule 430B, the General Disclosure Package or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with the Underwriter Information.
(c)
Actions against Parties; Notification. Each indemnified party shall give notice as promptly as reasonably practicable to
each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify
an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced
as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above, counsel to the indemnified parties shall be selected by
the Representative, and in the case of parties indemnified pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. An indemnifying party may participate at its own expense in the defense of any such action; provided, however,
that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified
party. In no event shall the indemnifying parties be liable for the reasonable fees and expenses of more than one counsel (in addition
to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect
to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever
in respect of which indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release
of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
23
(d)
Settlement without Consent if Failure to Reimburse. If at any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for
any settlement of the nature contemplated by Section 6(a)(ii) effected without its written consent if (i) such settlement is entered into
more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party
shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.
SECTION 7.
Contribution. If the indemnification provided for in Section 6 hereof is for any reason unavailable to or insufficient to
hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying
party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified
party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand,
and the Underwriters, on the other hand, from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company, on the one hand, and of the Underwriters, on the other hand, in connection
with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received
by the Company, on the one hand, and the Underwriters, on the other hand, in connection with the offering of the Securities pursuant to
this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company, on the one hand, and the total underwriting discount received
by the Underwriters, on the other hand, in each case as set forth on the cover of the Prospectus, bear to the aggregate public offering
price of the Securities as set forth on the cover of the Prospectus.
The relative fault of the
Company, on the one hand, and the Underwriters, on the other hand, shall be determined by reference to, among other things, whether any
such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even
if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement
or omission or alleged omission.
Notwithstanding the provisions
of this Section 7, no Underwriter shall be required to contribute any amount in excess of the underwriting discounts and commissions received
by such Underwriter in connection with the Securities underwritten by it and distributed to the public.
No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
For purposes of this Section
7, each person, if any, who controls an Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and
each Underwriter’s Affiliates and selling agents shall have the same rights to contribution as such Underwriter, and each director
of the Company, each officer of the Company who signed the Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company. The
Underwriters’ respective obligations to contribute pursuant to this Section 7 are several in proportion to the number of Closing
Shares and Pre-Funded Warrants, if any, set forth opposite their respective names in Schedule A hereto and not joint.
24
SECTION 8.
Representations, Warranties and Agreements to Survive. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its Subsidiaries submitted pursuant hereto, shall remain operative and
in full force and effect regardless of (i) any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents,
any person controlling any Underwriter, its officers or directors or any person controlling the Company and (ii) delivery of and payment
for the Securities.
SECTION 9.
Termination of Agreement.
(a)
Termination. The Representative may terminate this Agreement, by notice to the Company, at any time at or prior to the Closing
Time (i) if there has been, in the judgment of the Representative, since the time of execution of this Agreement or since the respective
dates as of which information is given in the Registration Statement, the General Disclosure Package or the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its Subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving a prospective change in U.S. or international political, financial
or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representative, impracticable or
inadvisable to proceed with the completion of the offering or to enforce contracts for the sale of the Securities, or (iii) if trading
in any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq Stock Market LLC, or (iv) if
trading generally on the NYSE American or the New York Stock Exchange or in the Nasdaq Capital Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges
or by order of the Commission, FINRA or any other governmental authority, or (v) a material disruption has occurred in commercial banking
or securities settlement or clearance services in the United States or with respect to Clearstream or Euroclear systems in Europe, or
(vi) if a banking moratorium has been declared by either Federal or New York authorities.
(b)
Liabilities. If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any
party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 4, 6, 7, 8, 14, 15 and 16 shall
survive such termination and remain in full force and effect.
SECTION 10.
Default by One or More of the Underwriters. If one or more of the Underwriters shall fail at the Closing Time to purchase
the Securities which it or they are obligated to purchase under this Agreement (the “Defaulted Securities”), the Representative
shall have the right, within 24 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Representative shall not have completed such arrangements within such 24-hour period, then:
(a)
if the number of Defaulted Securities does not exceed 10% of the number of Closing Shares and Pre-Funded Warrants, collectively,
to be purchased on such date, each of the non-defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(b)
if the number of Defaulted Securities exceeds 10% of the number of Closing Shares and Pre-Funded Warrants, collectively, to be
purchased on such date, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to
this Section shall relieve any defaulting Underwriter from liability in respect of its default.
In the event of any such default
which does not result in a termination of this Agreement, either the (i) Representative or (ii) the Company shall have the right to postpone
Closing Time for a period not exceeding seven days in order to effect any required changes in the Registration Statement, the General
Disclosure Package or the Prospectus or in any other documents or arrangements. As used herein, the term “Underwriter” includes
any person substituted for an Underwriter under this Section 10.
25
SECTION 11.
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: (i) 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 day on which the Nasdaq Stock Market LLC is open for trading (“Trading Day”), (ii) 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, (iii) the second (2nd) 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.
The address for such notices and communications shall be as set forth below:
if sent to the Representative or any Underwriter,
shall be delivered personally, by e-mail, or sent by a nationally recognized overnight courier service to:
TD Securities (USA)
LLC
1 Vanderbilt Avenue
New York, New York
10017
Attention: Head
of Equity Capital Markets
CIBLegal@tdsecurities.com
with a copy to Underwriters’ counsel (which
shall not constitute notice) at:
Mayer Brown LLP
1221 Avenue of
the Americas
New York, New York
10020
Attention: Anna T.
Pinedo, Esq. and Brian D. Hirshberg, Esq.
Email: apinedo@mayerbrown.com;
bhirshberg@mayerbrown.com
if sent to the Company, shall be delivered personally,
by e-mail, or sent by a nationally recognized overnight courier service to:
Duos Technologies
Group, Inc.
7660 Centurion
Parkway, Suite 100
Jacksonville, Florida
32256
Attention: Adrian
G. Goldfarb
Email: agg@duostech.com
with a copy to the Company counsel (which shall
not constitute notice) at:
Shutts & Bowen
LLP
200 South Biscayne
Boulevard, Suite 4100
Miami, Florida
33131
Attention: J. Thomas
Cookson
Email: tcookson@shutts.com
SECTION 12.
No Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (a) the purchase and sale of the Securities
pursuant to this Agreement, including the determination of the public offering price of the Securities and any related discounts and commissions,
is an arm’s-length commercial transaction between the Company, on the one hand, and the several Underwriters, on the other hand,
(b) in connection with the offering of the Securities and the process leading thereto, each Underwriter is and has been acting solely
as a principal and is not the agent or fiduciary of the Company, any of its Subsidiaries or their respective stockholders, creditors,
employees or any other party, (c) no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Company
with respect to the offering of the Securities or the process leading thereto (irrespective of whether such Underwriter has advised or
is currently advising the Company or any of its Subsidiaries on other matters) and no Underwriter has any obligation to the Company with
respect to the offering of the Securities except the obligations expressly set forth in this Agreement, (d) the Underwriters and their
respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and
(e) the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the offering of the Securities
and the Company has consulted its own respective legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
26
SECTION 13.
Parties. This Agreement shall each inure to the benefit of and be binding upon the Underwriters and the Company and their
respective successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters and the Company and their respective successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provision herein contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriters and the Company and their respective successors, and said controlling persons
and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Securities from any Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 14.
GOVERNING LAW. This agreement and any claim, controversy or dispute arising under or related to this agreement shall be
governed by, and construed in accordance with the laws of, the state of New York without regard to its choice of law provisions.
SECTION 15.
Waiver of Trial by Jury. The Company and each of the Underwriters hereby irrevocably waives, to the fullest extent permitted
by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
SECTION 16.
Consent to Jurisdiction; Waiver of Immunity. Any legal suit, action or proceeding arising out of or based upon this Agreement
or the transactions contemplated hereby shall be instituted in (i) the federal courts of the United States of America located in the City
and County of New York, Borough of Manhattan or (ii) the courts of the State of New York located in the City and County of New York, Borough
of Manhattan (collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction
(except for proceedings instituted in regard to the enforcement of a judgment of any such court, as to which such jurisdiction is non-exclusive)
of such courts in any such suit, action or proceeding. Service of any process, summons, notice or document by mail to such party’s
address set forth above shall be effective service of process for any suit, action or other proceeding brought in any such court. The
parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or other proceeding in the Specified
Courts and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit, action or other
proceeding brought in any such court has been brought in an inconvenient forum.
SECTION 17.
TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER
TO NEW YORK CITY TIME.
SECTION 18.
Partial Unenforceability. The invalidity or unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or provision hereof. If any Section, paragraph or provision
of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and
only such minor changes) as are necessary to make it valid and enforceable.
SECTION 19.
Counterparts. This Agreement may be executed in any number of counterparts (which may include counterparts delivered by
any standard form of telecommunication), each of which shall be deemed to be an original, but all such counterparts shall together constitute
one and the same agreement. Counterparts may be delivered via facsimile, electronic mail (including any electronic signature covered by
the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records Act or other applicable
law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly
delivered and be valid and effective for all purposes.
27
SECTION 20.
Effect of Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only
and shall not be deemed a part of this Agreement.
SECTION 21.
Entire Agreement. This Agreement supersedes all prior agreements and understandings (whether written or oral) between the
Company and the Underwriters, or any of them, with respect to the subject matter hereof.
SECTION 22.
Recognition of the U.S. Special Resolution Regimes. In the event that any Underwriter that is a Covered Entity becomes subject
to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation
in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution
Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United
States.
In the event that any Underwriter
that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime,
Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent
than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the
United States or a state of the United States.
For purposes of this Agreement,
(A) “BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance
with, 12 U.S.C. § 1841(k); (B) “Covered Entity” means any of the following: (i) a “covered entity” as that
term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is
defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined
in, and interpreted in accordance with, 12 C.F.R. § 382.2(b); (C) “Default Right” has the meaning assigned to that term
in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable; and (D) “U.S. Special
Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title
II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
[SIGNATURE PAGES FOLLOW]
28
Very truly yours,
DUOS TECHNOLOGIES GROUP, INC.
By: /s/ Adrian G. Goldfarb
Name: Adrian G. Goldfarb
Title: Interim Chief Financial Officer
Accepted as of the date hereof
TD SECURITIES (USA) LLC
By: /s/ Nadine Yang
Name: Nadine
Yang
Title: Managing Director
For themselves and as Representative of the other Underwriters named
in Schedule A hereto.
SCHEDULE A
Shares of Common Stock: 2,000,000
Pre-Funded Warrants: 3,800,000
Underwriter
Number of
Closing Shares
Number of
Pre-Funded Warrants
TD Securities (USA) LLC
1,600,000
3,040,000
Cantor Fitzgerald & Co.
400,000
760,000
Total
2,000,000
3,800,000
SCHEDULE B-1
Pricing Terms
Public Offering Price per Share of Common Stock: $9.50
Underwriters’ Discount per Share of Common Stock: $0.57
Public Offering Price per Pre-Funded Warrant: $9.499
Underwriters’ Discount per Pre-Funded Warrant: $0.57
SCHEDULE B-2
Free Writing Prospectuses
None.
Exhibit A
•
Adrian G. Goldfarb
•
Brian James
•
Charles P. Ferry
•
Doug Recker
•
Frank A. Lonegro
•
Michael Kellen
•
Ned Mavrommatis
•
James Craig Nixon
EXHIBIT A
FORM OF LOCK-UP
AGREEMENT
(See Attached)
EXHIBIT B
FORM OF PRE-FUNDED
WARRANT
(See Attached)
EX-4.1 — EXHIBIT 4.1
EX-4.1
Filename: ex4x1.htm · Sequence: 3
EXHIBIT 4.1
FORM OF
PRE-FUNDED COMMON STOCK PURCHASE WARRANT
DUOS
TECHNOLOGIES GROUP, INC.
Warrant Shares: _________
Initial Exercise Date: June__, 2026
THIS PRE-FUNDED 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”) until this Warrant is exercised in full (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Duos Technologies Group, Inc., a Florida 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.
“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.
“Commission”
means the United States Securities and Exchange Commission.
“Common Stock”
means the common stock of the Company, par value $0.001 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.
1
“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. 333-293372).
“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, OTCQB
or OTCQX (or any successors to any of the foregoing).
“Transfer Agent”
means Continental Stock Transfer & Trust Company, the current transfer agent of the Company, with a mailing address of 1 State Street,
Floor 30, New York, New York 10275 and an email address of eyoung@continentalstock.com, and any successor transfer agent of the Company.
“Underwriting Agreement”
means that certain Underwriting Agreement (the “Underwriting Agreement”), dated June 17, 2026, between the Company
and TD Securities (USA) LLC, as representative of the several Underwriters named in Schedule A thereto.
“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 (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 the OTCQB Venture Market (“OTCQB”) or the OTCQX Best
Market (“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 (“Pink Market”) operated by the
OTC Markets, Inc. (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 Holder and reasonably acceptable to the Company, the fees and expenses of which
shall be paid by the Company.
“Warrants”
means this Warrant and other Common Stock purchase warrants issued by the Company pursuant to the Registration Statement.
2
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 within one (1) 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 aggregate exercise price of this Warrant, except for a nominal exercise
price of $0.001 per Warrant Share, was pre-funded to the Company on or prior to the Initial Exercise Date and, consequently, no additional
consideration (other than the nominal exercise price of $0.001 per Warrant Share) shall be required to be paid by the Holder to any Person
to effect any exercise of this Warrant. The Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid
aggregate exercise price under any circumstance or for any reason whatsoever. The remaining unpaid exercise price per share of Common
Stock under this Warrant shall be $0.001, 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, 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)
both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and 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) at the option of the Holder, either (y) the VWAP on the Trading
Day immediately preceding the date of the applicable Notice of Exercise or (z) the Bid Price of the Common Stock on the principal Trading
Market as reported by Bloomberg L.P. (“Bloomberg”) as of the time of the Holder’s execution of the applicable
Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered
within two (2) hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading Day)
pursuant to Section 2(a) hereof 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 both executed and delivered pursuant to Section 2(a) hereof after the close of “regular
trading hours” on such Trading Day;
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 Warrant Shares shall take on the registered characteristics of the Warrants being exercised. 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) this Warrant is being exercised via cashless exercise, 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, then commencing on the date that is two (2) Trading Days after
the Warrant Share Delivery Date, provided that the Warrant Shares have not been delivered, 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.
4
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.
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.
5
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.
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 and shall not have any liability for any error by the Holder or any other Person. 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 the 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)
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 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).
c)
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 holders of shares of Common Stock,
by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property
or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction)
(a “Distribution”), 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). To the extent that this Warrant has not been partially
or completely exercised at the time of such Distribution, such portion of the Distribution shall be held in abeyance for the benefit of
the Holder until the Holder has exercised this Warrant.
7
d)
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
(other than for the purpose of changing the Company’s name or jurisdiction of incorporation or forming or collapsing a holding company),
(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 the Company’s assets on a consolidated basis 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 50% or more of the outstanding Common Stock or 50% or more 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 50% or
more of the outstanding shares of Common Stock or 50% or more 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 (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(d) pursuant to written agreements
in form and substance reasonably satisfactory to the Company and the holders of Warrants representing at least a majority of the shares
of Common Stock underlying the Warrants then outstanding (the “Required Holders”), and approved by the Required Holders
(without unreasonable delay) prior to such Fundamental Transaction and shall 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 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 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(d) regardless of whether the Company has sufficient authorized shares of Common Stock for
the issuance of Warrant Shares.
8
e)
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.
f)
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 and provided further that no notice shall be required if the information is in a press
release disseminated by the Company or a document filed by the Company with the Commission. To the extent that any notice provided in
this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. 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.
9
Section 4. Transfer
of Warrant.
a)
Transferability. 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. The Holder shall pay
any reasonable cost or expense in connection with the issuance of any new Warrant.
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. The Holder shall pay any reasonable cost or expense in connection with the issuance of any new Warrant.
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.
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.
10
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. The Holder shall pay any reasonable cost or expense in connection with the issuance of any
new Warrant.
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.
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.
11
e)
Governing Law; Venue. This Warrant shall be deemed to have been executed and delivered in
New York and both this Warrant and the transactions contemplated hereby shall be governed as to validity, interpretation, construction,
effect, and in all other respects by the laws of the State of New York applicable to agreements wholly performed within the borders of
such state and without regard to the conflicts of laws principals thereof (other than Section 5-1401 of The New York General Obligations
Law). Each of the Holder and the Company: (a) agrees that any legal suit, action or proceeding arising out of or relating to this Warrant
and/or the transactions contemplated hereby shall be instituted exclusively in the Supreme Court of the State of New York, New York County,
or in the United States District Court for the Southern District of New York, (b) waives any objection which it may have or hereafter
to the venue of any such suit, action or proceeding, and (c) irrevocably consents to the jurisdiction of the Supreme Court of the State
of New York, New York County, or in the United States District Court for the Southern District of New York in any such suit, action or
proceeding. Each of the Holder and the Company further agrees to accept and acknowledge service of any and all process which may be served
in any such suit, action or proceeding in the Supreme Court of the State of New York, New York County, or in the United States District
Court for the Southern District of New York and agrees that service of process upon the Company mailed by certified mail to the Company’s
address or delivered by Federal Express via overnight delivery shall be deemed in every respect effective service of process upon the
Company, in any such suit, action or proceeding, and service of process upon the Holder mailed by certified mail to the Holder’s
address or delivered by Federal Express via overnight delivery shall be deemed in every respect effective service process upon the Holder,
in any such suit, action or proceeding. THE HOLDER (ON BEHALF OF ITSELF, ITS SUBSIDIARIES AND, TO THE FULLEST EXTENT PERMITTED BY LAW,
ON BEHALF OF ITS RESPECTIVE EQUITY HOLDERS AND CREDITORS) AND THE COMPANY (ON BEHALF OF ITSELF, ITS SUBSIDIARIES AND, TO THE FULLEST EXTENT
PERMITTED BY LAW, ON BEHALF OF ITS RESPECTIVE EQUITY HOLDERS AND CREDITORS) HEREBY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY CLAIM BASED UPON, ARISING OUT OF OR IN CONNECTION WITH THIS WARRANT AND THE TRANSACTIONS CONTEMPLATED BY THIS WARRANT.
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 Duos Technologies Group, Inc., 7660 Centurion Parkway, Suite
100, Jacksonville, Florida 32256, Attention: Adrian Goldfarb, email address: agg@duostech.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 a Trading Day, (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, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously
file such notice with the Commission pursuant to a Current Report on Form 8-K.
12
i)
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.
j)
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.
k)
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.
l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.
m)
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.
n)
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.
DUOS TECHNOLOGIES GROUP,
INC.
By:__________________________________________
Name:
Title:
NOTICE OF EXERCISE
To:DUOS
TECHNOLOGIES GROUP, 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: ___________________________________________________________________
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: ____________________
EX-5.1 — OPINION OF SHUTTS & BOWEN LLP
EX-5.1
Filename: ex5x1.htm · Sequence: 4
EXHIBIT 5.1
Shutts & Bowen LLP
200 South Biscayne Boulevard
Suite 4100
Miami, FL 33131
DIRECT (305) 358-6300
FAX (305) 3581-9982
June 17, 2026
Duos Technologies Group, Inc.
7660 Centurion Parkway, Suite 100
Jacksonville, Florida 32256
Ladies and Gentlemen:
We have acted as counsel
to Duos Technologies Group, Inc., a Florida corporation (the “Company”), in connection with the issuance and sale by the
Company of 2,000,000 shares (the “Shares”) of its common stock, par value $0.001 per share (the “Common
Stock”), and the Pre-Funded Warrants (the “Warrants”) to purchase up to 3,800,000 shares of Common Stock (the
“Warrant Shares”) pursuant to the Underwriting Agreement, dated June 17, 2026 (the “Underwriting
Agreement”), between the Company and TD Securities (US) LLC,
as representative of the several underwriters named in Schedule 1 thereto (the “Underwriters”).
In connection with this
opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of (i) the Registration
Statement on Form S-3 (File No. 333-293372) which was filed with the Securities and Exchange Commission (the
“Commission”) on February 11, 2026, under the Securities Act of 1933, as amended (the “Securities Act”);
(ii) the Underwriting Agreement and the Warrants; (iii) the prospectus, dated February 12, 2026 (the “Base Prospectus”),
which forms part of the Registration Statement; (iv) the prospectus supplement, filed with the Commission on June 17, 2026
( the “Prospectus Supplement”); (v) the Amended and Restated Articles of Incorporation of the Company, as
amended, as currently in effect; (vi) the Amended and Restated By-Laws of the Company, as amended, as currently in effect; and (vii)
certain resolutions and minutes of meetings of the Board of Directors of the Company and the Pricing Committee thereof, relating to
the Registration Statement (including the Base Prospectus), the Prospectus Supplement, the Shares, the Warrants, the Warrant Shares,
the Underwriting Agreement and the transactions contemplated thereby. We have also examined originals or copies, certified or
otherwise identified to our satisfaction, of such records of the Company and such agreements, certificates of public officials,
certificates of officers or other representatives of the Company and others, and such other documents, certificates and records as
we have deemed necessary or appropriate as a basis for the opinion set forth herein.
In our examination, we have
assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us
as originals, the conformity to original documents of all documents submitted to us as facsimile, electronic, certified, conformed or
photostatic copies, and the authenticity of the originals of such copies. In making our examination of executed documents, we have assumed
that the parties thereto, other than the Company, had the power, corporate or other, to enter into and perform all obligations thereunder
and have also assumed the due authorization by all requisite action, corporate or other, and the execution and delivery by such parties
of such documents and the validity and binding effect thereof on such parties. As to any facts material to the opinion expressed herein
which we have not independently established or verified, we have relied upon statements and representations of officers and other representatives
of the Company and others.
Based upon the foregoing
and subject to the limitations set forth below, we are of the opinion that (i) the Shares have been duly authorized and, when issued
and paid for as described in the Prospectus Supplement and pursuant to the Underwriting Agreement, will be validly issued, fully paid
and non-assessable, (ii) provided that the Warrants have been duly executed, issued and delivered by the Company against payment therefor
as described in the Prospectus Supplement and pursuant to the Underwriting Agreement, the Warrants will be valid and binding obligations
of the Company, enforceable against the Company in accordance with their terms, except as enforcement thereof may be limited by bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance, and debtor and creditor and similar laws which relate to or affect creditors’
rights generally, and by general principles of equity (regardless of whether considered in a proceeding in equity or at law), and (iii)
the Warrant Shares, when issued and paid for in accordance with the terms of the Warrants, will be validly issued, fully paid and non-assessable.
We express no opinion as to
matters governed by laws of any jurisdiction other than the laws of the State of Florida and the federal laws of the United States of
America, as in effect on the date hereof.
We are opining only as to
matters expressly set forth herein, and no opinion should be inferred as to any other matters. This opinion is rendered as of the date
hereof and is based upon currently existing statutes, rules, regulations and judicial decisions. We disclaim any obligation to advise
you of any change in any of these sources of law or subsequent legal or factual developments that affect any matters or opinions set forth
herein.
We hereby consent to the incorporation
by reference of this letter as an exhibit to the Form 8-K being filed in connection with the entry into the Underwriting Agreement and
to any and all references to our firm in the Prospectus Supplement. In giving our consent, we do not thereby admit that we are in the
category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations thereunder.
Very truly yours,
/s/ Shutts & Bowen LLP
EX-99.1 — PRESS RELEASE
EX-99.1
Filename: ex99x1.htm · Sequence: 5
EXHIBIT 99.1
Duos Technologies Group Closes $55M Registered
Direct Offering
JACKSONVILLE, FL / Globe Newswire / June 17, 2026
- Duos Technologies Group, Inc. (“Duos” or the “Company”)
(Nasdaq: DUOT) a leading provider of adaptive, modular, and scalable Edge Data Center (“EDC”) solutions, today announced an
underwritten registered direct offering of 2,000,000 shares of common stock and 3,800,000 pre-funded warrants at a price of $9.50 per
share or warrant for total gross proceeds of approximately $55 million, before deducting underwriting discounts, commissions, and offering
expenses.
The registered direct offering was completed by a
single large institutional investor, to support the Company's continued growth plans. The net proceeds from the offering will be used
to expand, accelerate, and further commercialize the Company’s Edge Data Center business and for working capital and general corporate
purposes.
TD Cowen acted as lead bookrunner on the transaction.
Cantor acted as joint bookrunner on the transaction.
The public offering was made pursuant to a shelf
registration statement on Form S-3 (File No. 333-293372) filed with the Securities and Exchange Commission (“SEC”) on February
11, 2026, and declared effective by the SEC on February 12, 2026. The public offering was made only by means of a final prospectus supplement
and the accompanying base prospectus that form a part of the registration statement. Copies of the final prospectus supplement and the
accompanying base prospectus relating to the offering may be accessed for free on the SEC’s website at www.sec.gov or obtained by
contacting TD Securities (USA) LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 or by email at TDManualrequest@broadridge.com
.
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 Duos Technologies Group, Inc.
Duos Technologies Group, Inc. (Nasdaq:
DUOT), based in Jacksonville, Florida, is focused on providing and managing modular data center colocation facilities and infrastructure
solutions. Through its wholly owned subsidiaries Duos Edge AI, Inc., and Duos Technology Solutions, Inc., the Company delivers high function
computing infrastructure at the “Edge” designed to support high power computing facilities suitable for AI and Enterprise
Computing. Duos is strategically focused on scaling its edge data center platforms in conjunction with its data center infrastructure
solutions business. It provides manufacturer-agnostic sourcing and fulfillment services to support efficient deployment of data centers
and IT environments. Together, these platforms position the Company to address the growing demand for distributed digital infrastructure,
while continuing to support legacy applications in Tier 3 and Tier 4 markets.
For more information, visit www.duostech.com and www.duosedge.ai.
Forward-Looking Statements
This news release includes forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, regarding, among other things our expectations regarding the completion, terms, size, and timing of the public offering, and
with respect to granting the underwriters a 30-day option to purchase additional shares, in addition to our plans, strategies and prospects
-- both business and financial. Although we believe that our plans, intentions and expectations reflected in or suggested by these forward-looking
statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions or expectations. Forward-looking
statements are inherently subject to risks, uncertainties and assumptions. Many of the forward-looking statements contained in this news
release may be identified by the use of forward-looking words such as "believe," "expect," "anticipate,"
"should," "planned," "will," "may," "intend," "estimated," and "potential,"
among others. Important factors that could cause actual results to differ materially from the forward-looking statements we make in this
news release include risks and uncertainties related to completion of the public offering on the anticipated terms or at all, market conditions
and the satisfaction of customary closing conditions related to the public offering and those set forth in reports or documents that we
file from time to time with the United States Securities and Exchange Commission. We do not undertake or accept any obligation or undertaking
to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change
in events, conditions or circumstances on which any such statement is based, except as required by law. All forward-looking statements
attributable to Duos Technologies Group, Inc. or a person acting on its behalf are expressly qualified in their entirety by this cautionary
language.
Contacts
Media contact
DUOT@duostech.com
This press release was published by a CLEAR® Verified individual.
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